Jeff Lloyd [00:01:10]:
It’s like, Wes, look at this article. Not a lot of depth through it. I really don’t even know what they’re trying to accomplish with this article, but you got to read it.

Wes Moss [00:01:17]:
They are taking major shots at two of the most fundamentally important financial rules of thumb and strategies that you can think of. There’s a Mount Rushmore of financial theories that help people get to a successful retirement. Two of them are what this article is saying that may just not work anymore. So that’s one is the balanced portfolio that might not work anymore, and two is the 4% rule. We call it the 4% plus rule. They say the 4% rule doesn’t work. May not work in the future either. So we take great issue with that one.

Wes Moss [00:01:55]:
I like that they’re questioning it. I think that’s totally fair to do. But they don’t really offer up anything of why this won’t work in the future, except for, hey, the stock market might not be all that great moving forward, and the bond market might not be all that great moving forward. And that’s it. You can always say that. So imagine. And that’s why I think it’s an important topic here to revisit. Imagine if a time honored strategy puts you into financial ruin.

Wes Moss [00:02:24]:
Just imagine what a new unproven gimmick would do if you’re listening to the retire sooner podcast. You’ve probably been saving for retirement for five years, ten years, 20, maybe 30 years, and you’ve been doing this over and over. It’s not just a marathon it’s an ultra marathon of how long it takes to do this, and you’re ready to embark on your retire sooner journey. You’ve been fighting the good fight, saving, investing, doing all this planning, and you’re not banking on some new age retirement theory that hasn’t been proven. You’re looking and saying, I’m looking at what’s worked over the course of the last half century, or really century of economic history that’s been passed down through generations. You’ve got your balanced stock bond portfolio, maybe 60, maybe 70% stocks, the rest in something a little bit more conservative. And you’ve planned for years that your portfolio can hold up under the 4% withdrawal rule, which is, again, 4% plus inflation. And you have a very low probability of ever running out of money.

Wes Moss [00:03:23]:
It’s how we can, we studied, how do you max out what you’re pulling out from retirement portfolio without running out? Jeff Lloyd, I think you came up with that. And these strategies, these rules of, and again, they are rules of thumb, so they don’t work perfectly all the time or every year or linearly, but over time, they certainly have really helped many people get to where they’re headed for their retire sooner journey. To me, these are like John Bogle from Vanguard. They’re two of the main ingredients in the, in the John Bogle apple pie. That’s how important these things are. Now suddenly the financial world starts whispering that none of these ingredients are just, they don’t work anymore. You don’t want to use apples anymore. They used to be good for 100 years.

Wes Moss [00:04:12]:
They’re not good anymore. Okay? What’s worked for an entire century, it’s just kaput. Just forget about it. Doesn’t work anymore. So if that doesn’t discourage you and have your hands, my hands are up in the air right now. If that doesn’t discourage you, then I don’t know what does. So that’s what’s happening here with this uplifting personal financial article, personal finance piece I just found in the Wall Street Journal. The author declares the death of the balanced portfolio and the death of the 4% roll, complete with a graveyard scene.

Wes Moss [00:04:48]:
So you open this thing, and this is where you can’t not click on it. They’ve got a tombstone in the tombstone etched 60 40 balance portfolio. Then they’ve got a mummy with a skeleton hand coming out of the ground, holding in the skeleton’s hand an envelope that says, your retirement. Jeff Floyd it couldn’t even be.

Jeff Lloyd [00:05:08]:
It’s a cryptic saying. It’s a scary headline. You know, you’re talking about financial ruin. You’re reading that headline, and then you see that kind of gruesome picture that’s depicting your retirement in a graveyard being.

Wes Moss [00:05:23]:
Held by a zombie. Wait, what is the walkie? The walking dead.

Jeff Lloyd [00:05:27]:
The Walking Dead.

Wes Moss [00:05:28]:
The Walking Dead is coming for your retirement would have been just as good of a title. So the problem is that while devoid of any real reasoning except that the world of investing just might simply fall short of economic history and just. It used to be good, but it’s not going to be good anymore. I think what it does, or articles like this is, and again, I’m fine on questioning all of these things, we should question them. But if people read this, it scares you. You think, wait a minute, like the Wall Street Journal just said that all these things have been banking on, they just, they’re not gonna, they might not work anymore. And it’s not that they say they might not work anymore. It says that it puts you at risk of financial ruinous.

Wes Moss [00:06:11]:
It’s not just that they say they could just not be as good in the future. It says no financial ruin. So I think that’s scary, and therein lies. I think what the problem is is that if you scare people that retirement is impossible. And denouncing the 4% rule makes retirement. That’s already really hard, makes it almost impossible. If you can barely use any of your money, they suggest that you should only use 2.25%. But it serves to have particularly younger folks just stop before they even get started, quit before we even start the race.

Wes Moss [00:06:49]:
And I think that’s the last thing we need. The idea that these foundational strategies are suddenly just broken. It’s not just negative. I think it can be destructive for those of us that are fighting for our retirement security and our economic freedom. So, yes, Jeff Floyd, as we both know, but market’s unpredictable. We were just talking to producer Mallory. How many times have we seen big upheavals in just the last couple of years?

Jeff Lloyd [00:07:20]:
Look, if you just kind of want to think recently, look, we’ll go back four years to Covid. You saw the market down 30 plus.

Wes Moss [00:07:27]:
Percent in a month.

Jeff Lloyd [00:07:28]:
2022, it was down 20 plus percent. Even go back to 2018, it was down close to 20%. So that’s three pretty violent swings in the stock market in the last six years.

Wes Moss [00:07:43]:
So, yes, markets are unpredictable. That’s not a shocker. And 2022 was not a banner year for the 60 40 portfolio. And that’s largely because we got to a very interesting inflection point where rates were at zero and they finally went back to a more of a normal level. And by the way, they’re back to a slightly more normal level that we’ve seen over the last 20 years. But I don’t think it means that you throw out 100 years worth of financial wisdom. In fact, Vanguard defended, and smartly so the balance portfolio back in 2022 is titled. They wrote a white paper called that like the Phoenix, the 60 40 portfolio will rise again.

Wes Moss [00:08:24]:
And soon after that, they turned out to be very much right. By Feb. By February of 2024, the traditional balance portfolio had largely recovered its losses from 2022. And I think just panic rarely works in our favor. Really, almost panic rarely works in life, but certainly not in investing. And putting a gravestone on some really fundamentally important rules that millions of Americans use to get through the retirement ultra marathon, I think it could just do some damage. Vanguard’s chief economist is Roger Aleaga Diaz. He’s also the head of portfolio construction back in 2022.

Wes Moss [00:09:03]:
Said this, he said, periodically, pundits declare the death of the 60 40 stock bond portfolio. Their voices have grown louder lately amid declines in both stock prices and bond prices. But we’ve been here before. Based on history, balanced portfolios are apt to prove the naysayers wrong again. He was right.

Jeff Lloyd [00:09:25]:
And I think the important part of that quote was based on history. He’s not just basing it on some new thing. It’s based on 100 plus years of data.

Wes Moss [00:09:38]:
Right? This is not a gift. This is not a new gimmick. This is not a new age strategy. Balanced portfolios and measured withdrawal rates that account for inflation. These are the two rules under attack, the 60 40 portfolio and the 4% rule. They’ve been the backbone of retirement for millions of Americans for many, many decades. Are they perfect? No. Are they smooth escalator rides to the place we want to go? No.

Wes Moss [00:10:07]:
But to say they’re suddenly useless, that’s a bit like swearing off cookies. One of the batch. You know what it’s swearing off? Apple pies. I have one apple pie. All apple pies are bad from now on. I had one apple pie. Stop making apple pies. They’re no good.

Wes Moss [00:10:23]:
But if we let fear and negativity drive the entire conversation, then we discourage people from even trying to plan for retirement to begin with. Dead on arrival. Speaking of the way they depicted this dead on arrival, the reality is that we call them a rule of thumb for a reason. It’s not expected to work in a straight line, and they’re gonna be adjustments. So you gotta, both of these rules require adjusting all the time. Not dramatic adjustments, but they require adjustments as needed. They’ll always be needed. But I think the fundamentals are still very strong.

Wes Moss [00:11:02]:
If you’ve ever done a Jane Fonda workout, or if you remember as a kid, Rocky running the steps. And if Michael Keaton is still mister mom to you, and guess what? It’s officially time to do some retirement planning. It’s Wes moss from money matters. Weren’t those the good old days? Well, with a little bit of retirement planning, there are plenty of good days ahead. Schedule an appointment with our team today@yourwealth.com. dot that’s your, yourwealth.com dot. Again, this is according to the Vanguard White paper, since 1976, investors have, this is a quote, have never encountered a three year span of losses in both stocks and bonds. Remember, the balance portfolio is meant to have two very complementary asset classes.

Wes Moss [00:11:54]:
One’s risky, but has a higher return historically, over time, one is much sleepier. That provides some income and stability over time. Put them together, and now you start to have the apple pie we’re looking for. Here’s from the same vanguard white paper. The goal of the 60 40 portfolio is to achieve long term annualized returns of roughly 7%. This is coming from the vanguard white paper. This is meant to be achieved over time and on average, and not each and every year. The annualized return to the 60 40 stock bond portfolio from January 1, 1926 through December 31 of 2021 was 8.8%.

Wes Moss [00:12:40]:
So before you start thinking that retirement planning is hopeless, remember this. A little perspective, I think, goes a long way. Sky isn’t falling. It’s just always a little cloudy. To say that balanced portfolio is not going to work moving forward. You essentially have to say stocks are going to stop working moving forward, and bonds are going to stop working moving forward. That’s essentially what you have to assume. The reasons they cited in the article were that the Shiller P E ratio is high and the national debt is high, and Social Security might be running out.

Wes Moss [00:13:16]:
That was it. Those were the three reasons why the balance portfolio might not work into the future.

Jeff Lloyd [00:13:24]:
Those were the reasons they were attacking. Two of the Mount Rushmore financial principles have been used for 100 years.

Wes Moss [00:13:32]:
Hey, the national debt is high. The national debt has been high for a very long time.

Jeff Lloyd [00:13:35]:
It’s been like that for a while.

Wes Moss [00:13:37]:
And people have been saying Social Security is going to run out for a very long time. And yes, there have been some bumps in the road. So you go back to 2022 bonds were actually down in 2022 and it made for the first really rough 60 40 balanced portfolio since 1974. And because there was a bad year, this article is just saying that bonds just won’t be the shock absorber they once were. I don’t think that’s necessarily true. But what is true? Do bonds really make a balanced portfolio safer? I think the answer is still yes, or at least less choppy in the overall portfolio. Less choppy in a stock market pullback. Were bonds better investing when rates were at six or 7% or even 5% versus 4%? Sure.

Wes Moss [00:14:28]:
But do bonds today moving forward, provide no shock absorption? No way. At the very least, bonds, I think, allow investors to have the maximum amount of stock exposure for your own risk tolerance and help you with your investor psyche. And again, could stocks stop working? Could the army of american productivity go on strike? Possible. It’s always possible. We could economically just go over a cliff tomorrow and everybody goes on strike and we just say AI is taking over and the computers are going to do all the work and what’s the point? And productivity stops. And sure, that sounds like it’d be a problem, and that’s possible, but it’s not even remotely probable the way I look at it. So to say that the market will just stop working over the next long cycle, 10, 20, 30 years, it’s just to say that our whole system is going to end up collapsing and again, could happen. I just don’t think it does.

Jeff Lloyd [00:15:34]:
It makes for a good headline. But like you said, it’s not very probable. And there wasn’t a lot of substance of why it went and there were no alternatives they were offering of, well, don’t use this balanced 60 40 approach. Use this. Or don’t do the 4% rule. Use this. There was none of that.

Wes Moss [00:15:57]:
Well, technically they do on the 4% rule. Here’s what it is, and this is, I think, what got me really, I think when you first emailed me this, you said, please do not read while driving.

Jeff Lloyd [00:16:06]:
That’s what I said. I hope you don’t read this while driving. I don’t want you jerking that car off the side of the road after reading this.

Wes Moss [00:16:13]:
All right, so here’s my favorite. A recent academic paper says that if you want a 95% chance of avoiding financial ruin, and it’s the language here, and again, look, they’re writing and they’re trying to bring an eyeball. So I don’t blame them for this, but if you want to avoid complete catastrophe, you can withdraw just 2.26% per year.

Jeff Lloyd [00:16:35]:
2.26. That’s their Goldilocks number, 2.27, not 2.252.26. That’s just.

Wes Moss [00:16:44]:
It would have been better if it was just a round number to remember, like two and a quarter. I’m calling it two and a quarter percent per year. That means only about twenty two k per million dollars saved per year. In retirement you have 2 million, you get a whopping forty four k a year for $2 million worth of savings. Essentially chops the 4% rule in half. The retired student team has run these numbers and they’ve re run these numbers, and we’ve rerun the numbers on how a balanced portfolio, which, by the way, is at the cornerstone of the 4% rule. 4% rule, doesn’t work with a super high level of confidence. If you’re all in stock or all in bond, it doesn’t work with the extremes, it really works with the balance.

Wes Moss [00:17:33]:
And here it is using a 60 40% portfolio that gets rebalanced every year. In our study, we’re simply, let’s say, let’s look at just the 4% level plus inflation each year off of our initial base number that we start with in retirement. Using that balance points to a 99% level of success. And success means not running out of money for at least 30 years. The five worst outcomes for that balanced portfolio are at worst 30 years. So it didn’t last more than 30, but it did actually last 30. That is three decades. You start at 60.

Wes Moss [00:18:11]:
It lasts you in a worst case scenario until you are 90. Then the next worst outcomes were 31 years, 37, 38 and 39 years. Those were the worst outcomes because many of the outcomes, depending on when you start your retirement date over the course of economic history. We went back to the 1920s and we said, let’s start retirement in any given month from starting 100 years ago. And the worst case scenario is when we had super high inflation and we had low stock market returns, and that collided having money run out just like that in 30 years. That was the worst case scenario. Heres the counter to the balance. If you look at a 4% withdrawal rate and you use 100% stocks, it works again.

Wes Moss [00:18:56]:
Most of the time, it still gives you a really high probability of success. Its 97% of scenarios lasted 30 plus years. But the thing to be concerned about is that 3% of the time are pretty bad. In those instances, because of the way the timing worked out, you start needing money. Inflation is going up pretty rapidly and stays high for a long time, like it was in the 1970s and early eighties. And also, you didn’t have a good stock market. Again, there’s some periods of time in the seventies, so money only lasted in 3% of scenarios. It did run out more quickly, 26 years, 17 years and 16 years.

Wes Moss [00:19:35]:
And that is a little concerning. So if we want a higher level of peace of mind, and not everybody needs this, but if you’re looking for a higher level peace of mind, then at least over the course of economic history, you’re wanting to look at a balanced portfolio also utilizing the 4% rule. Jeff, I want to hear the vanguard chief economist who said that periodically people announced the death of the balance portfolio, or the 4% is similar to the 4% rule. You pulled some headlines.

Jeff Lloyd [00:20:06]:
Well, I love the headline of this article was a time honored strategy puts your retirement at risk of financial ruin.

Wes Moss [00:20:13]:
That’s today. That’s the article we’re exploring today.

Jeff Lloyd [00:20:17]:
And it’s basically a time honored tradition of bashing the 4% rule. And I did a little bit of digging on some previous headlines over the years that were bashing the 4% rule we had in March of 2013. Say goodbye to the 4% rule.

Wes Moss [00:20:33]:
Okay.

Jeff Lloyd [00:20:34]:
January 2015 how much can you safely spend in retirement? And you go in and you read and they say 2.35% to 3.51%.

Wes Moss [00:20:44]:
2.35 is better than the two and a quarter.

Jeff Lloyd [00:20:47]:
2.262.26 February 2018 forget the 4% rule. Rethinking common retirement beliefs. And then recently, in November 2021, the 4% retirement rule is in doubt. Will your nest egg last? And those are, you know what? I love reading those articles. I love reading this article because it gives us a chance to rerun the numbers, recheck, look at it again.

Wes Moss [00:21:16]:
And I think that’s a healthy exercise.

Jeff Lloyd [00:21:19]:
And I think it’s a healthy exercise for us.

Wes Moss [00:21:20]:
We’re doing it here on the retire sooner podcast. So bottom line, although it’s always good to test the rules, I think it’s hard to take any given day or week or month, and then the environment we’re in and say that, hey, today changes or nullifies a rule of thumb that’s meant to work over multi decades. Hey, things are weird today. So the rule that’s supposed to last for 50 years doesn’t work anymore, that doesn’t match up, doesn’t align. So in our opinion here on the retired senior podcast, yep, 4% rule is not dead. And the balance between risk assets and safety assets all in one portfolio, I think that still stands the test of time, or at least Jeff Lloyd versus any other alternative, which you mentioned or any other alternative that we can find. So don’t let scary headlines scare you out of the journey.

Mallory Boggs [00:22:23]:
Hey y’all. This is Mallory with the retire sooner team. Please be sure to rate and subscribe to this podcast and share it with a friend. If you have any questions, you can find us@westmoss.com dot. That’s wesmoss.com. you can also follow us on Instagram and YouTube. You’ll find us under the handle Retire Sooner podcast. And now for our show’s disclosure.

Mallory Boggs [00:22:43]:
This information is provided to you as a resource for informational purposes only and is not to be viewed as investment advice or recommendations. Investing involves risk, including the possible loss of principal. There is no guaranteed offer that investment return, yield or performance will be achieved. Stock prices fluctuate, sometimes rapidly and dramatically, due to factors affecting individual companies, particular industries or sectors, or general market conditions for stocks paying dividends. Dividends are not guaranteed and can increase, decrease, or be eliminated without notice. Fixed income securities involve interest rate, credit inflation and reinvestment risks and possible loss of principal. As interest rates rise, the value of fixed income securities falls. Past performance is not indeed of future results.

Mallory Boggs [00:23:24]:
When considering any investment vehicle, this information is being presented without consideration of the investment objectives, risk tolerance, or financial circumstances of any specific investor and might not be suitable for all investors. Investment decisions should not be based solely on information contained here. This information is not intended to and should not form a primary basis for any investment decision that you may make. Always consult your own legal, tax or investment advisor before making any investment tax, estate or financial planning considerations or decisions. The information contained here is strictly an opinion and it is not known whether the strategies will be successful. The views and opinions expressed are for educational purposes only as of the date of production and may change without notice at any time based on numerous factors such as market and other conditions.

Alan Castel [00:00:45]:
Yeah, for sure. Well, I’m not a clinical psychologist, and then I don’t see patients, but I do interact a lot with older adults, middle aged adults, even undergraduate students who are interested and concerned about what happens as we get older. So I think it’s always good to start thinking about this at an early age. There’s no better time to cultivate lifestyles, habits, even have mentors for aging. And so a lot of us, when I was growing up, I spent a lot of time in Florida with grandparents, and then condominium was full of older adults, and I saw a variety of patterns of aging, and I really enjoyed interacting with older adults. So I think that’s what brought this interest into how we age, how we can age well, how does that change with our habits that we develop when we’re younger?

Wes Moss [00:01:35]:
I’d love to circle back to the mentor question. I don’t know if I’ve heard of it put that way, but I think right off the bat of somebody who is 75 can be kind of a super old 75 year old, and then you can find a super young 75 year old. And I want to get to that, but I wanted to start with something fun, which I do love, kind of some of your commentary around names. You’ve already given us something around to remember. Tell us about names and why are we so bad at remembering names? And then maybe the trick to kind of get better at it.Alan Castel [00:02:12]:
Well, it’s pretty much the first thing you notice as you get older. You say, why can’t I remember names as well as I used to? And names are a tough one to begin with because our names are arbitrary. Right. There’s no good reason my name is Alan, other than my parents last names can maybe have some meaning or history. So I tell people, usually we don’t remember names because we don’t do anything with them. You introduce someone and you quickly are interested in their family and their job and where they live, and the name is just gone. So the first thing is attention. We don’t put a lot of attention into trying to grab the name and do something with it and use it.

Alan Castel [00:02:47]:
It’s called retrieval practice when you use it several times in conversation. So if you want to remember a name, I tell people my name is Alan Castell. It rhymes with pastel. My grandfather was a painter. He used pastels, let’s say. Or it’s like castle, but it’s a castle illusion. You switch the e and the l, and now people are doing something with the name and you’re more likely to remember it, but you’re also more likely to misremember it, saying, that was doctor Pastel, or he said his name was Castle. So memory is a function of what we do with information.

Alan Castel [00:03:18]:
So I think names are just a good illustration of that.

Wes Moss [00:03:21]:
Well, I think a good point. If back, I don’t know, go back 50 years, go back 80 years, I don’t know, or go back a couple hundred years, you would call people, I guess, by their profession to some extent, right?

Alan Castel [00:03:36]:
Yeah. And that’s why people are still Mister Barber or baker. But, you know, those things are long gone. And sure, a castle. Castell probably meant a spanish castle back in the day. I don’t live in a castle at all. But I also tell people that as we get older, there’s just more information in your brain. So you’ve met so many Brians and Alan’s and people named Smith, that there’s a lot of interference.

Alan Castel [00:04:00]:
And so that’s another problem with names are accessibility. You know, you know the name, you just can’t retrieve it at a specific time. And so that’s another theory of memory. As we get older, there’s just more going on, and at any given time it’s hard to access it. But I also remind people that forgetting names is very common, and it’s not something necessarily to be worried about. And I think our memory is somewhat adaptive in that what you want to remember is if you like the person or if you had an interesting conversation, or if you can trust them. Those are probably more important things to know about a person than remembering their name, but not knowing anything else about them.

Wes Moss [00:04:37]:
By the way, was your grandfather actually a painter?

Alan Castel [00:04:40]:
He was a painter. I don’t think Pascal’s was his main medium, but it makes for a good story.

Wes Moss [00:04:47]:
It does. Okay, next question that I think is kind of a fun topic. And I don’t know the real answer to this, but I call this kind of just the age freeze phenomenon, where as we, as our brains inform us of what we think, kind of how old we feel. And is that something that’s just kind of set? Do we all feel naturally a little younger inside? Producer Mallory, who is, I don’t know, 38, thinks she says she’s 32 in her brain. I’ve got folks that I’ve worked with for many years that are 70 that say, hey, I still feel like I’m 27. What is that phenomenon about?

Alan Castel [00:05:29]:
No, it’s a great question. It’s something called subjective age. It’s how old you feel, and often it doesn’t match up with our biological age. And research shows that kind of after the age of 40, people tend to feel, report feeling about 20% younger than their actual age. So the observations you say, make sense, and we don’t really know why that is. It’s not that we’re deceiving ourselves, but we sometimes look in the mirror and be like, wow, I look older than I feel. But maybe that gives you that sense of vitality or being able to do things. On the other hand, there’s some days where you wake up and you certainly feel your age when your back seizes up or one knee locks up or you’re running around grandchildren, you’re like, they have so much energy.

Alan Castel [00:06:12]:
I feel my age now. I think it can work both ways, but I think it is interesting that we tend to feel younger. And I share this story that my son and I, we were getting during COVID getting haircuts at home, and we were cutting each other’s hair, and he said, I want my hair cut like daddy’s with the hole on top. I never even noticed that so much. But to him, that’s a cool thing. So I think genetically, he’ll probably get it at some point. I think there’s signs of aging that we don’t always pay attention to or that we try and hide. We dye our hair or wear hats because we don’t want to be reminded that we might be older than we feel.

Wes Moss [00:06:52]:
But is it kind of a natural, almost survival skill to place ourselves at a younger.

Alan Castel [00:06:58]:
Well, it could be. And in terms of retirement and financial planning, that’s actually an important question, because it’s sometimes hard to imagine our future self if we constantly think we’re 20% younger. So what we want to do is sometimes project ourselves in the future and say, hey, when I’m 60, 70, 80, what sorts of activities do I want to do? What do I want to be able. Where do I want to be? And so there’s apps and technology that can age your face to make you look older, and that might make you make more adaptive decisions about retirement. So it’s kind of an interesting phenomenon that we should be thinking about aging, and yet sometimes we want to, we feel younger, so we act younger.

Wes Moss [00:07:39]:
You know, I remember when face app, I think it’s called faceapp, that kind of went viral, and everybody was sending around. It was such an amazingly accurate, or it was so well done. And I haven’t seen that recently, but I suspect it’s just as prevalent. And it’s very easy to upload a picture if you’re 40 and say, hey, what am I gonna look like when I’m 80? I don’t know if people really want to see that, but it is kind of fascinating.

Alan Castel [00:08:05]:
No, no. But coming back to the mentors of aging, you mentioned it. I think that’s where we can see. Look at your parents or your grandparents. How did they age? And you’ll notice either physically or emotionally or mentally, how they age. And I think, so that’s something we think about. Or when we look at photos of us when we were younger, like 1020 years ago, you might say, wow, I looked so much different. Or you might think, oh, something haven’t really changed.

Alan Castel [00:08:29]:
So we do notice people who have kind of aged well physically. And that was kind of inspiration for my book a little bit, because our age stereotypes about aging are usually negative. We want to avoid it. We want to hide signs of aging. And yet there’s all sorts of people out there who are really amazing, people who’ve aged well in different ways.

Wes Moss [00:08:51]:
Yeah, maybe give me an example of that.

Alan Castel [00:08:54]:
Well, that was part of when I teach my class at UCLA. That’s how we start. I say, give me five examples of people who you think have aged well or you admire. I, and a lot of it’s like a grandparent or a mother, someone you’re related to, which I think is important because there’s some genetic overlap. But then some people will say things. There’s people like Jack Lalanne, who I got to interview for this book, or some people, there’s Betty White. But as you get younger, people will say things like J. Lo, who I wouldn’t think is an aging figure, but I guess we’re getting older.

Alan Castel [00:09:30]:
The point is, people see people like, hey, I’d like to be like that in 1020, 30, 40 years. How do I get to that point? And so when you have that positive stereotype about aging. And you realize it’s not all about genetics, because a lot of these people, it’s not like they had the family that lived a long time. They’ve engaged in lifestyles that can promote healthy aging. So I think it’s a good place to start, is to think of case studies, and sometimes it’s a, a coach they had or a teacher. But I think it’s important to cultivate these ideas that, yes, there’s a lot of challenges that happen as we get older. And we can also think of the negatives, like people who’ve struggled with aging or unfortunately passed away too early, and what can we do to ensure that we live a long life?

Wes Moss [00:10:16]:
I think of the two great Olympic hosts, Snoop Dogg and Martha Stewart, over the last, over the Paris Olympics. Martha Stewart is, well, she’s in her eighties, and just her vibrancy just doesn’t add up to that at all. So I don’t think she’ll be my age mentor, but she’s a pretty amazing example of that.

Alan Castel [00:10:42]:
Yeah, I think there’s definitely celebrities and public figures. In some ways they’re unique because they might not want to retire or they get opportunities in older age that most people wouldn’t get. You know, it’s hard to get a job when you’re 80, but if you’re.

Wes Moss [00:10:56]:
A celebrity commentating the Olympics, when I’m 80, I want to.

Alan Castel [00:10:59]:
Well, yeah, but I think it makes us think, hey, when I’m 80 or 70 or retire, you know, what sorts of things can I do? And by seeing older people do these things, it means I could, you know, you don’t necessarily need to be a tv commentator, but I could do things that I might not think a 70 or 80 year old would be necessarily doing.

Wes Moss [00:11:16]:
When you talk about an age mentor, is that something where you’re just kind of, you’re thinking that through and identifying what, let’s say a handful of people are like, and you benchmark in your mind, gosh, I’d like to be similar to that as I age. Or do you actually engage with somebody and talk to them about that?

Alan Castel [00:11:36]:
I think it’s a little bit of both. I’ve had informal age mentors, grandparents who had great sense of humor, who I still follow patterns that I think I remember from them with my own children. But then I have professional colleagues who I’m like, wow, look what they’re doing at 70, 80, 90. And so I spend time with them, and I think we pick and choose, like, wow, I hope I can do that. But maybe I won’t be that way. Or, oh, they’re not interacting with technology the way I do. I wonder how technology will be different in 50 years, and how would I engage that way so, or even with retirement? Some people fight it and some people embrace it. And, you know, I’m at an age, a lot of people, where it’s like, what parts would you choose to follow? And so I think it’s an informal observation.

Alan Castel [00:12:22]:
Sometimes you’re not picking one person saying, that’s what I’m going to do. You’re looking at all the things people encounter and say, how will I deal with that challenge or opportunity at that age?

Wes Moss [00:12:36]:
When do we see is the decline? Well, I’d like you talk through how you think through memory decline or kind of a new level of, maybe you call it selectivity, or you distill what you remember. And is memory decline, is it just a natural lower with memory, or is there an inflection point? Typically, yeah.

Alan Castel [00:12:58]:
I like to think of memory as changing with age, not necessarily just starting off as a decline because it actually changes from infancy. And what changes is, yes, there’s certainly some things that tend to decline, but there’s some things that remain stable or even get better with age. Vocabulary knowledge, sometimes remembering to do things in the future. Prospective memory. Grandparents and parents who remember birthdays better than I do. So I think there’s different types of memory that change in different ways. And my research at UCLA for the last 20 years has really looked at memory selectivity, that if we know our memory is changing in some ways, not so good, how do we selectively focus on remembering what’s important and that can be different for different people. Sure, we want to remember names, but maybe you need to remember your granddaughter’s allergy.

Alan Castel [00:13:52]:
That’s more important than remembering their teacher’s name, let’s say. And so as we get older, we might know, like, I’m not good at remembering this. I’m going to write it down, or I need to set this reminder, or I’m going to ask someone else to remember this. So I think memory selectivity could actually improve with age because we’re more aware of what we’ll forget. We’ve had more instances of forgetting. We’ve seen how our memory has changed. And so I think older adults might actually be in some ways better because they’ve had more experience with how memory changes. And of course, there’s things that can happen biologically, dementia, Alzheimer’s disease, that really change the game.

Alan Castel [00:14:30]:
But I think if you’re still healthy, and active. You’re using your memory in a fairly adaptive way.

Wes Moss [00:14:36]:
You know, I know that you’ve written about kind of happier aging, where as we age, we can to some extent have a, maybe it’s a more, I don’t know if it’s a more positive outlook or we just report higher levels of satisfaction relative to being younger. Tell us about that. Can we look forward to just gradually getting a little happier with age, just biologically?

Alan Castel [00:15:01]:
Yeah. I mean, there’s interesting research that looks, you know, it’s hard to rate happiness, but if you just ask people at momentarily, how happy are you? There’s this u shaped function where it’s not a linear decline that actually people in middle age report the least amount of happiness. But what’s interesting is it tends to increase as we get older and approach older age. So something’s happening. It’s not just biological change that might make older adults more, have greater life satisfaction, maybe worry less, maybe have more appreciation for having good health. And it’s not like college is the best time in your life, and it just gets worse from there. In fact, rates of clinical depression are, in fact, now higher in college age students than they are at healthy older adults. So there’s something going on that might be causing older adults or even people who are entering old age to appreciate life in a way that makes you happier.

Wes Moss [00:15:57]:
When is the bottom of the year? What’s the max? Unhappiness. Age?

Alan Castel [00:16:01]:
Well, this research is really hard to do. You’re asking people a very, you know, difficult question. How do you summarize happiness? But when you look at the bottom of the curve, I like to point out, when I’m teaching at UCLA, it’s pretty much exactly my age. You know, it’s between 45 and 50 often, and nobody really knows why. It’s not necessarily, you know, you find this in people who have children. You find this in people who don’t have children. It’s. There’s cultural similarities.

Alan Castel [00:16:28]:
You know, you could just be busy. Maybe you’re not spending as much time on activities that maybe a lot of responsibility, maybe there’s financial challenges, but that tends to be about the bottom of the curve. And of course, it’s different for different people. But I do remind people that in some ways, that’s uplifting to know that if you’re around that age, you can get better. And so I think there’s something interesting to understand why that’s the case. But I think in terms of talking about successful aging, part of it is.

Wes Moss [00:17:00]:
Just reaching older age, just getting there is successful, right?

Alan Castel [00:17:04]:
Sure.

Wes Moss [00:17:05]:
So for those 45, so the listeners at age 45 to 50, do not worry. According to a professor at UCLA, it’s gonna get better. Life will just naturally get a little bit better year after year after year. So it’s a lot to look forward to. There’s some hopefulness there. Alan, if you’ve ever done a Jane Fonda workout or if you remember as a kid rocky running the steps, and if Michael Keaton is still Mister mom to you, then guess what? It’s officially time to do some retirement planning. It’s Wes Moss. Weren’t those the good old days? Well, with a little bit of retirement planning, there are plenty of good days ahead.

Wes Moss [00:17:48]:
Schedule an appointment with our team today@yourwealth.com. dot that’s your, yourwealth.com dot. I wanted to ask about curiosity because, so let’s say that we naturally, we get more selective with our memory. You say it changes more than it just maybe doesn’t decline, but it morphs and changes. But what is the impact of curiosity? A, I’m a big believer in it. I think that in my, I’ve written that curiosity may have killed the cat, but a lack of curiosity kills the happy retiree. But more, I think, more importantly, can you get more curious?

Alan Castel [00:18:32]:
Yeah. Curiosity is just another one of these things that’s so important across the lifespan. Kids start asking questions like why is the sky blue? Or why can’t I have dessert for breakfast? And all of a sudden you have to answer. And I think as we get older, curiosity is important, but I think there’s also a selectivity to it as well that a lot of older adults will say, I remain curious or interested, but more in the things that interests me the most. So if you’re curious in everything, you’re going to get distracted. You’re not going to get anything done. And so I think there’s a selectivity component as well, that as you get older, you might get more into bird watching or maybe you’ll pick up a new hobby that you’re like, I’ve never even thought about this. And now I’m so curious about how this works.

Alan Castel [00:19:17]:
Having a sense of awe is also something that seems to enhance aging, that especially during COVID people would all of a sudden walk around their neighborhood and be like, wow, there are these beautiful trees. I’ve never noticed. You know, things that we take for granted can engage our curiosity, and I think that’s important. As we get older, you can also just, it’s amazing that you can pick up a phone and talk to someone on the other side of the world now for free? Pretty much. And so that, how does that work? So that engages curiosity and awe. But I also say there can be a dark side to curiosity and that there’s a lot of scams and fraud. Clickbait or getting some great offer on the phone or investing in bitcoin, well, that can engage your curiosity, and financially that can be quite dangerous. So I’ve written a little bit about we have to engage our curiosity in a responsible manner because we don’t want to get caught in rabbit holes or engaging with fraudsters.

Alan Castel [00:20:15]:
So it’s really an important concept to understand.

Wes Moss [00:20:19]:
I think about this one item that I’ve researched as part of the lifestyle habits of happy versus unhappy retirees is they do engage. I call these core pursuits or hobbies on steroids. And again, to your point, there’s no exact way to measure this, the way I communicate. A core pursuit is something that you think about a lot and you really look forward to. It’s not just a hobby you do once in a while, but it’s one that you really like to pursue. It’s really a life pursuit and you want to get better at doing it. You want to do it often. And there’s just something about it that kind of raises it to the level that I think of it as these hobbies on steroids.

Wes Moss [00:21:00]:
When it comes to curiosity, do you encourage folks to go out and say, look, if you only have one or two hobbies, it’s just not enough. You should really think about cultivating a couple of new things or one new thing per year. And have you seen correlations between those two and happiness?

Alan Castel [00:21:20]:
Well, pursuing novelty really can be important, but sometimes you can get these things by pursuing things you find interesting, like traveling. Let’s say a lot of people as they retire, say they want to travel more. So now you get to go on that trip to Italy, or maybe you’ll go to a destination you’ve been to many times, but discover something new. So that’s, I think, like in terms of stimulating our brain, being around different people, doing new things can be great. On the other hand, sometimes it’s playing more golf or a bridge club or exercise class. But again, picking up new activities within that you’re going to interact with new people, maybe do different exercises. Things like bird watching are surprisingly one of the most, the largest growing hobby. And when you’re younger, you might not think much about it, but you get to be in nature.

Alan Castel [00:22:10]:
You can be around other people, you’re gaining new knowledge, you’re seeing new things. So it can be a really rewarding experience, even if it just gets you out. Right, like it gets you or gets you looking at birds online or interacting with other people who have this expertise. Musical instrument, too, sometimes. I’ve picked up piano again. You know, I’ve seen my daughters play music and really get engaged. And, you know, it’s not to become a concert pianist. It allows you to maybe return to it when you’re 40, 50, 60, play in a trio, appreciate music.

Alan Castel [00:22:43]:
So I think these are things our brain needs. Being around people can be really important. So if you have a hobby that can engage a community, a hobby that can engage your brain musically, socially, these are just as important as people say. To keep your brain sharp, I need to do crossword puzzles or sudoku. I almost tell them that’s like strengthening a strength. That’s one thing. Vocabulary tends to get better with age. If you’re doing crosswords, great.

Alan Castel [00:23:11]:
But you might not be stimulating your brain in a way that engages things that might be requiring a little extra.

Wes Moss [00:23:19]:
Well, let’s talk about socialization for a minute, because, again, as you go through, all of these are examples of core pursuits where I guess I understand how people could get birdwatching. If you would ask me at 30, I would have said, that’s going to be out of my top 100 list. It’s like number 99. The older I’ve gotten, I kind of get it. I can see how, to your point, it’s new knowledge. It’s nature, which I guess I kind of took nature for granted because I grew up in a very rural setting, and then I’ve lived in the city for a couple of decades now. But then the return to nature is kind of, that is, there’s something magical about that. But then you also mentioned that it’s social.

Wes Moss [00:24:02]:
So a good portion of core pursuits I can come up with, and I’ve got a list of, you know, my hundred favorite, but a lot of them really are social. So what is the talk about the importance of socialization? Maybe the effort we should be looking at towards social core pursuits, and why is it so good for us?

Alan Castel [00:24:23]:
Yeah, I think it’s something that’s often forgotten. We take it for granted because you might be in school, there’s a lot of structures set up. You’re around people all the time. But especially as we contemplate retirement, we realize that there is a social scene built into our workplace. This is actually somewhat more specific to people who might not have a large social circle, and sometimes men especially, who take for granted that at their workplace or their environment, that’s where they get a lot of social interaction. And it’s not necessarily with their best friends and so on, but it’s that just checking in or talking about something that happened. And so when you retire, you might lose a big chunk of that, and you realize that. I think, again, Covid was a good test of this, where we still had a job and we’re, you know, but we weren’t coming in.

Alan Castel [00:25:12]:
We weren’t seeing people face to face. And people all of a sudden realize something’s really missing here. I miss coming in at least one day a week or just having those social interactions. So you can imagine in retirement, how would that change, you know? So I think it’s really important. As we get older, our social circle does tend to shrink, but the quality of those relationships can actually increase. So I think, again, it’s, it’s not just like things get worse with age, things change in different ways. So I think it’s important to cultivate those relationships, but also important to make new ones. You know, if you’re joining a new club or exercise, a lot of sometimes people relocate.

Alan Castel [00:25:52]:
And that’s kind of the big thing in the first few months is how am I going to meet people who I can interact with? So, again, if there’s groups or organizations or hobbies that you can use to meet other people, that can be incredibly.

Wes Moss [00:26:04]:
Important, you know, and I have found that, I think about the folks that, let’s say I’ve worked with for 20 years that have moved and done really geographic moves, can even be small. I mean, you can move from the middle of midtown Atlanta. If you move 40 minutes north, you really are. You might as well move to Texas. It’s because it’s just as hard to get into an urban area with traffic, et cetera, and the folks that I’ve seen that have done the best at it. So it doesn’t always work. One, it’s usually getting closer to their kids. So they’re adult children, number one.

Wes Moss [00:26:40]:
Number two, they have some sort of, whether it’s an active adult community or it’s just a 55 plus, the folks that have really integrated into the new location, particularly when you’re going to another state, they’re so intent in that first year reviving and cultivating a new social group, which is hard. I mean, I think about, I’ve had, I have one of my kids is at a kind of really a new school, and just seeing them go, seeing him go through kind of starting over socially, it’s hard, and I don’t think it’s, you know, I think it’s just as hard at any age. If you’re starting from scratch, you really have to put in a lot of effort in the beginning to get some social momentum because once you have a couple of people you’re close with, I think it gets a lot easier. That initial momentum can be really tough, and I think it’s important for people to understand that if they’re moving.

Alan Castel [00:27:36]:
Yeah, no, it takes a lot of effort, and I think that’s what you, again, see in retirement. There’s different ways people engage with others in retirement. And it’s very easy just to be at home and sit on the couch or feel like you’re getting your social interactions online, you know, but it’s so much, it’s very different. And I think David Letterman, the comedian, once said that before you retire, to spend more time with your family, check with your family, because your family aren’t your friends always. You want to be around family and be available and be there, but it’s the friendships that you have that take you out of the house and allow you to pursue interests and pursuits that your family might not be as engaged in. So I think that’s overlooked sometimes.

Wes Moss [00:28:27]:
So you’ve studied successful aging. You’ve studied how people kind of the habits of folks. You mentioned Jack Lalanne. I think of him swimming across the ocean with like a chain on his back. I don’t know how old he was when he did that, but tell our listeners what you see that the happiest people have in common as they age.

Alan Castel [00:28:51]:
Yeah, I mean, I think some of these people are unique, like Jack Loyan, and they’re just great individual stories. But I think after interviewing a lot of older adults and looking at the research I talk about in terms of the abcs of successful aging, I think it’s an easy way to remember it with a standing for attitude. You have to have a positive attitude about getting older or at least knowing that there’s going to be challenges. So a could also be to adapt to all the challenges that are going to be put in front of you as you get older. But I think attitude is important, and a lot of the people I’ve talked to say that’s definitely, you’re going to have to have a sense of humorous, that sort of thing. The second one is balance. When I interviewed John Wooden, he said the two most important things in life were love and balance, and he was around the people he loved. He did the things he loved.

Alan Castel [00:29:41]:
But having a sense of balance is often overlooked. We’re very focused on a job or a career, but we need to have downtime or time with friends and physical balance. One in three people over the age of 65 are going to experience a fall, and a fall can lead to a broken hip, wrist, collarbone. Then you’re not mobile if you’re not walking. We know walking is one of the best things we can do to keep our memory sharp. So now your brain is changing in.

Wes Moss [00:30:11]:
Ways walking helps our memory. I don’t know if I’ve heard that.

Alan Castel [00:30:14]:
Yeah, that’s a whole interesting area of research that shows that as much as we think brain stimulation is important, physical exercise is probably getting blood flow to your brain. It allows you to sleep better. And so probably the best thing you can do to keep your memory sharp is to get exercise. And walking is kind of the most natural thing you can do, so. And it allows for balance. It’s the kind of thing you can also do balance training. You know, standing on one leg, you don’t need to do yoga, but if you fall, you’ve lost a lot of independence. So I think just staying on your 2ft is the second tip that balancing and then the last thing C is connection.

Alan Castel [00:30:53]:
And it’s what we just talked about, really, is staying connected to the things you love, the people you love. So there’s that big social component of having connection and also connection to life, right? Like feeling that you have some meaning or you’re connecting with the next generation. So a lot of people, as they contemplate retirement or get into older age, feel this need for generativity. You know, how are you contributing to the next generation? And it could be, you know, through writing books or teaching or interacting with grandchildren. So engaging with something that’s kind of bigger than yourself could be religion, something that keeps you connected, keeps you going.

Wes Moss [00:31:29]:
I really love the idea of an age mentor. I think that as I think this through, I’m thinking of a couple age mentors that I had. I’d never thought of them that way. I’ve never thought of them as, hey, you’re somebody who’s maybe two decades older than me, and I kind of want to be like you when I’m two decades older than today. And I think I’m going to talk to them about that, I’m going to bring it up.

Alan Castel [00:31:52]:
I think people appreciate that. I think as we get older, we realize, what can I contribute to the next generation? And I’ve had a few age mentors, and it’s not always as formal, but it’s clear that they’re doing things that are incredible or professionally. Sometimes it’s set up that way, but things change. The world’s different. So it’s not like, oh, they’re doing this, I want to do this in 20 years. Might not be a thing in 20 years. Even so, I think the more important thing is to look at their attitudes about, like, gosh, they’re open minded or they’re emotionally aware of things. Those skills are really important and might, you know, get better as we get older.

Wes Moss [00:32:30]:
Well, we’re going to get happier from 45, well, let’s call it mid forties, maybe 50 plus. It just gets better and better. I’m going to. I’m going to make it. The mnemonic part of remembering names is I’m going to try to remember, to try to remember dams and just do that, because I do love when I know somebody’s name, there’s some level of confidence in that. I love the idea that our memory really, now, of course, with dementia and certain cognitive diseases, it declines. But it doesn’t necessarily just decline. It changes over time, and we get more selective around that, which is kind of an encouraging way to think about it, too, I think, to your point around socialization and attitude and balance, that I think is such a good reminder for folks that those really are the keys.

Wes Moss [00:33:23]:
That is the key if you can do those three things. How old did John wooden live to?

Alan Castel [00:33:28]:
He lived in 99, and I interviewed him in his early nineties and again in his mid nineties. And just that level of positivity he had, even though his spouse had passed away, he was not afraid of dying. You know, he fell in his apartment and he had a life alert that he could press. He fell at night, but he didn’t press that life alert because he didn’t want to bother anybody. It was the middle of the night, so he waited until the morning, until his caretaker came and they rushed him to the hospital. He had a broken collarbone and wrist. He really should have pressed it. But again, this is another instance of, as we get older, you know, there’s this level of he didn’t want to be a burden.

Alan Castel [00:34:11]:
He didn’t want to bother anyone. So I think this is also like with technology providing all these opportunities to help older adults, there’s a psychological barrier, too, that we need to be aware of.

Wes Moss [00:34:23]:
Besides Wooden, who’s kind of one of your favorite successful agers, you could share with our audience.

Alan Castel [00:34:30]:
I mean, Maya Angelou was really impressive. I got to interview her when she came to UCLA briefly. I reach out to a lot of people, some people who don’t have a lot of time, some people who really make time. I really do think wooden was when I got my job at UCLA, I grew up in Canada, so I heard probably another mentor of aging. My math teacher, who was also my basketball coach, would always quote wooden, and I always thought these quotes were kind of funny, but they made sense. And then it was a dream job to come to UCLA. And I thought, gosh, would I get a chance to meet coach Wooden? It was through. He actually came and lectured in a few classes.

Alan Castel [00:35:10]:
And one of the, you know, the professors said, alan, he’d be a great person to interview. And so it was thankfully that she put me in touch with him. And the funny thing is, one of the interviews, you know, the night before, he called my cell phone to remind me of the interview. And I thought, how is a 90 year old calling me to remind me in case I forgot? So I thought just another instance of a very humble, you know, person who is just revered but also in his prime. And while he was winning all those championships, a tough guy to work with, I think a micromanager. People said he was detail oriented. So people change as they get older, but I think he, by far, was an inspiration and a really unique experience for me to chat with him.

Wes Moss [00:35:59]:
So what’s next for you? What is the research that you’re most excited about now? What are you newly writing about now?

Alan Castel [00:36:06]:
Yeah, I’m still doing work on memory selectivity, trying to understand how that changes, how we kind of get more selective as we get older. I’m looking at, you know, some of the. Concerning things that happen as we get older because we’re targeted for scams and fraud that happens at any point in our life, but trying to understand how to avoid that and then things, you know, that I think are really engaging, like curiosity and awe. How do we appreciate these things, especially as we get older? So those are some of the directions that I’m going in, and it’s really exciting to chat with people like you who are applying this knowledge and getting the word out there.

Wes Moss [00:36:42]:
Yeah, we’re trying to do that in real life. And when it takes real research to be able to do that. So, Alan’s Professor Castell, it’s funny. You’re one of your mnemonic devices, I think you did in your TED talk. The castle one always makes me want to say castle.

Alan Castel [00:36:59]:
So I had to pause for just confusing. That’s fine.

Wes Moss [00:37:03]:
That’s actually a cool name too, Doctor Castle, but sure would have been easier.

Alan Castel [00:37:08]:
If that was my name, trust me.

Wes Moss [00:37:11]:
But Professor Alan Castell, thank you so much man.

Alan Castel [00:37:14]:
Thanks for having me on the show.

Mallory [00:37:17]:
Hey y’all. This is Mallory with the retire sooner team. Please be sure to rate and subscribe to this podcast and share it with a friend. If you have any questions, you can find us at. That’s wesmoss.com. you can also follow us on Instagram and YouTube. You’ll find us under the handle Retire Sooner podcast. And now for our show’s disclosure.

Mallory [00:37:37]:
This information is provided to you as a resource for informational purposes only and is not to be viewed as investment advice or recommendations. Investing involves risk, including the possible loss of principal. There is no guaranteed offer that investment return, yield, or performance will be achieved. Stock prices fluctuate, sometimes rapidly and dramatically, due to factors affecting individual companies, particularly industries or sectors, or general market conditions for stocks paying dividends. Dividends are not guaranteed and can increase, decrease, or be eliminated without notice. Fixed income securities involve interest rate, credit inflation and reinvestment risks and possible loss of principal. As interest rates rise, the value of fixed income securities falls. Past performance is not indicative of future results.

Mallory [00:38:18]:
When considering any investment vehicle, this information is being presented without consideration of the investment objectives, risk tolerance, or financial circumstances of any specific investor and might not be suitable for all investors. Investment decisions should not be based solely on information contained here. This information is not intended to and should not form a primary basis for any investment decision that you may make. Always consult your own legal, tax or investment advisor before making any investment tax, estate, or financial planning considerations or decisions. The information contained here is strictly an opinion and it is not known whether the strategies will be successful. The views and opinions expressed are for educational purposes only as of the date of production and may change without notice at any time. Based on numerous factors such as market and other conditions.

Wes Moss [00:00:51]:
I’m just going to do it here while we’re in the studio. It’ll take just a few minutes, but it’s part of one of our foundational investment principles, and that is just to do a little bit of planning. And then it’s fine to do planning every so often. Update a plan, do a new plan, figure out a new way to look at retirement. And if you can do it easily and accessibly in a couple minutes, why not? I find it so almost fun. And the roadmap we can give ourselves just lowers anxiety when it comes to a very anxious sport investing. Now, today we’re going to go through the Mallory joins us. Mallory Boggs producer been a little while since we’ve had you in studio.

Wes Moss [00:01:30]:
Thank you for being here on the mic.

Mallory Boggs [00:01:32]:
So excited to be here. Yeah, yeah. I feel like normally you got me like sitting in the corner making weird faces at you.

Wes Moss [00:01:38]:
Say that. What did you say? Say that again.

Mallory Boggs [00:01:39]:
Hang on. I don’t understand.

Wes Moss [00:01:41]:
And so today you are. So you can just say live if you don’t understand. As we go through this. Thanks. Thank you for being here. I want to reflect for a minute. And by the way, we have, call it five foundational investment principles for the retire sooner community that we want to go through. First, I want to reflect just a minute about what we as investors have just been through in the last, call it quarter of a century, 25 years.

Wes Moss [00:02:05]:
And I think that gives us some clarity of what we’re trying to do and help with here on the retire sooner podcast and help us tune out the noise. There is so much noise as if the world is burning down around us. Everything’s awful. The world’s broken like the media would like us to believe with that. See, in that same vein, I don’t use social media all that much? Yes, our team does. We post important things, but I’m not scrolling almost ever through any social media, and I did for some reason. So one of our other producers, Jeff Lloyd, will frequently send me really interesting market facts from an account that may be on x or somewhere. Maybe it’s Facebook, maybe it’s x.

Wes Moss [00:02:50]:
And he sent me one today about the number of houses in the United States that have gone over a million dollars. That number was 4% a handful of years ago, before the pandemic. Because we’ve had such housing appreciation price wise. Now it’s something like eight and a half percent of homes in the United States are worth over a million dollars or have a million dollar value. The whole point of seeing a chart like that that has grown dramatically over the past, call it five years and ten years, is that housing affordability has gotten worse and worse. It’s harder and harder for the everyday American on the median salary in the United States, or even a median high salary for the high earning category to be able to buy a home. So then what happened? As you can probably imagine, Mallory, what happened? I got stuck doom scrolling.

Mallory Boggs [00:03:39]:
Oh well, here’s a real question. Were you doom scrolling on Twitter or did you go straight to zillow and start looking around on there? Because personally I love to pull up Zillow and start looking at all the different houses.

Wes Moss [00:03:47]:
I love zillow. I have a couple saved searches of places I might think about maybe one day moving. And I do love that. I love Zillow, love being able to see houses, see what they’re worth. This morning I saw one of the, I don’t know which company it was, but it was one of those photo cars. Oh yeah, the Google Maps cars and where they have all the different lidar around. They’re taking pictures of your street. So that’s besides the point.

Wes Moss [00:04:16]:
This was only a few minutes. I only got stuck doom scrolling for maybe five minutes. But it was negative after negative after negative after negative. Housing prices, just everything on the economy, right? So you go and you’re reading something about the economy. The comments, of course were all negative. Then it was. The next iteration was not only have housing prices gone through the roof and we have over eight and a half percent of all homes in the United States, over a million dollars, the amount that we have to pay as Americans as a percentage of our salary has now hit all time high. To be able to buy the median house in America, it’s something like 40 plus percent of the money we bring home in the United States, 40% would go to a new mortgage if you bought a home today.

Wes Moss [00:04:58]:
Of course, if somebody’s locked in a much lower rate, that’s okay. That reminds me of another doom scroll, that the folks in America that have low mortgage rates are now able to rent their homes out for twice what their mortgage amount is. They’re going to go to smaller towns and they’re going to rent a house and they’re going to essentially make money every single month. And what’s that going to do? It’s going to perpetuate the housing issue because people aren’t going to sell and it’s going to cause more inflation. Then I saw a chart of rising bankruptcies in the United States. More and more companies have been.

Mallory Boggs [00:05:33]:
My point here is that, let me just be very clear. You’re giving me anxiety just going through all of these. I’m sitting here and I’m like, okay, well now it’s getting worse. And like, I’m like, I get why people aren’t moving. And like maybe that, like, you know, if you can rent out your house and make money, that’s good. But then you’re like, it increases inflation. It just sounds like it gets worse and worse.

Wes Moss [00:05:50]:
So the point of this is that you gonna, at any given time and again, here we are in a really good economy, in any given time, you can go and read 100 things that are bad no matter what period of time we’re in. Sometimes it’s even easier to make a bear case or a bad case for the economy. And things aren’t good. But it’s always that way.

Mallory Boggs [00:06:14]:
Is it kind of like that annoying aunt at the family reunion that you get next to and you’re just like, please stop talking about how terrible the world is never going to stop. Never, never.

Wes Moss [00:06:23]:
Social media is never going to stop. And that is again, one of the principles around why investing is tough. So whether you listen to this podcast today, next month, next year, it’s always the same. There’s lots of bad news that the world is happy to bestow upon you. And guess what? You can do it for free. The real cost is your time and the anxiety that provokes, the unnecessary anxiety that provokes, and what it does to diminish your long term market returns because it puts you in a state of fear. And we know we don’t do well. We don’t make good decisions when we’re in a state of fear.

Wes Moss [00:06:56]:
So we’ve gone through a rough 25 years and we’ve come out dramatically better than where we started. Ten years ago and 15 years ago and 20 years ago and 25 years ago. And think about all the craziness that we’ve been through. Massive bout of hyperinflation. Can’t deny that this completely unprecedented election cycle where we had an assassination attempt, we had an incumbent president drop out of the race, we’ve never seen this combination. It’s always something new. It’s always something that is new and unprecedented. Unprecedented is a scary word.

Wes Moss [00:07:35]:
COVID pandemic. Before that, stocks were down 30% in a matter of a month prior to that global financial crisis. An economic crisis. 2007, 2009, stock prices went down 55% for the s and P 500. Then, of course, before that, in reverse chronological order.com burst again. Stocks down 50% between 2000 2002. That’s all just in the last 24, 25 years. At the start of all this, right before.com went bust, the Dow was around 10,000.

Wes Moss [00:08:09]:
And despite all that carnage we’ve seen in the economy and the markets during that stretch, the Dow Jones stands at least as we sit here today, comfortably above 40,000, with a total return of over 490%, including dividends, or nearly six x, six times your original money. If you had invested back then, it’s almost an identical story. For the S and P 500, you go to January of 2000. It’s risen about 280% as I sit here today in price, but over 490%, including reinvesting dividends, again, six times your original money.

Mallory Boggs [00:08:47]:
That’s a nice argument to remind you that, like, listen, as much as the headlines love to come in and tell you how awful everything is, the sun will come out tomorrow. And what is that you always like to say? The army of american productivity is going to show up.

Wes Moss [00:09:01]:
The army of american productivity is going to allow us to fight another day, inch the football just a little bit forward every single day. And eventually what’s happened over the course of economic history and market history, markets eventually realize that even though there’s times when the ball gets pushed back and sacks happen all the time going through these numbers, and if you look at it from again, let’s just, let’s just do January of 2000 through June, the end of June 2024, for the S and P 500, it was a 492% gain. So almost 500% averaged a little over 7.5% annualized rate of return. Remember, that’s going through some really rough periods of time. During that early stretch of the two thousands, really through the early in the mid two thousands, really through the entire decade of the 2000, I was sitting.

Mallory Boggs [00:09:56]:
Here, I was like, I don’t know if you can really limit it to those. And then you got some things that got kind of funky there. It was not always a tough decade.

Wes Moss [00:10:06]:
And then you look at the Dow Jones industrial average, again, same exact period of time. January of 2000 through end of June of this year of 2024 through June of 2024, almost an identical cumulative rate of return if you’re reinvesting dividends, 492% again, a little over seven and a half percent on average rate of return year over year during that 24 25 year stretch. Looking at it, January 2010 through June of has averaged more like 13.5%. The Dow Jones during that same period of time has averaged about 11.9. So almost 12% both. Again, dramatically positive results over time. If we give it time. Investing isn’t rocket science, but it takes a, a really strong stomach and an enormous dose of time and patience and in many cases, mental endurance, mental toughness for the big bumps and the sacks and the declines that are inevitably along the way.

Wes Moss [00:11:13]:
If you’ve ever done a Jane Fonda workout or if you remember as a kid rocky running the steps, and if Michael Keaton is still Mister mom to you. But guess what? It’s officially time to do some retirement planning. It’s wes Moss. Weren’t those the good old days? Well, with a little bit of retirement planning, there are plenty of good days ahead. Schedule an appointment with our team today@yourwealth.com. dot that’s y o u, ryourwealth.com. so here are five of what I think are the most important financial pieces when we’re thinking about being investors over time to survive that journey. Number one, stocks mostly.

Mallory Boggs [00:11:56]:
Stocks mostly. What is, what is that supposed to mean?

Wes Moss [00:11:59]:
There are plenty of financial planning advocates that will tell you that you need 100% stocks at all times, because that’s what does the best over time. That’s our best weapon against inflation. The reality is that that’s not necessarily right for everybody. There’s almost too much volatility to handle mentally. If you’re just 100% stocks, some folks can handle it, particularly if you’re younger.

Mallory Boggs [00:12:22]:
Well, to that point, I think oftentimes it probably comes back to how much you have in the bank. I’m sure looking at like 100,000 versus a million. Seeing a 10% dip is dramatically different.

Wes Moss [00:12:33]:
I’ve talked to behavioral psychologists that don’t give that a lot of credence. They say that a 10% decline hurts whether it’s $100,000 and you’re down ten, or you have a million dollars and you’re down 10%, or you have 10 million and you’re down 10%. I tend to think that the lull of larger numbers makes things harder as you accumulate more.

Mallory Boggs [00:12:55]:
Yeah, being down $100,000 per year, perhaps.

Wes Moss [00:12:58]:
That’S up for debate. So again, I strongly believe in us equities. We talk about that here all the time. I still think that is one of our best bets to combat and rise above the pace of inflation that we’re all trying to, to fight against. I also realize that an all in, if we’re talking about stocks, an all in strategy just doesn’t work for everyone’s stomach. So I think we can use other areas for diversification, including safety assets. Including, as much as some people don’t like fixed income or cash, because it doesn’t earn us what stocks should over time. I think a certain percentage there is really important so that we can maximize what our equity exposure is to a tolerable level.

Wes Moss [00:13:47]:
That means if you can’t have 100% in stocks, how much in safety assets does it take for you to feel comfortable with your stock exposure? That might simply be three years worth of dry powder. Dry powder. Just let’s call it safety assets that we’re not worried about going down much, or if any, during a stock market decline. So take your annual spending, let’s say it’s $100,000 per year, multiply it by three. It’s $300,000. So if you have a million dollars, it would be 30% to set aside into safety assets, the rest in equities. That’s what really should, over the long term, protect you against inflation. So that’s number one, stocks mostly.

Wes Moss [00:14:30]:
Number two, patience and longevity. The shade that we’re sitting under here today, not maybe literally, Mallory, but it’s because somebody planted a tree a very long time ago. Long time ago, not a year ago, that’s a sapling. But at least ten years ago, and 20, and 30. And now we’re talking about some serious cover, serious shade. That’s just the reality of the world. Growth, like a massive white oak tree, simply takes a couple decades to really produce shade and protection, and being patient and giving yourself longevity to invest, those are both purely behavioral. There are no analytics involved there.

Wes Moss [00:15:14]:
Those are just behavioral practices, and they have almost nothing to do with picking any actual investments.

Mallory Boggs [00:15:22]:
Let me ask you, Wes, because you’ve been working with families for many, many, many years now. What habits have you seen for people who are really particularly good at this patience and longevity piece.

Mallory Boggs [00:15:37]:
I’m putting you on the spot.

Wes Moss [00:15:38]:
No, that’s an awesome question. So humans are inherently flawed investors. Just because we’re meant to protect ourselves, we’re meant to protect what we gather, what we accumulate. Go back 10,000 years. Imagine getting dinner and then dinner all of a sudden, because you were careless, is gone. The consequence is so big you’re hungry for the night, maybe you starve. So we have this. The thought around the whisper of danger, again, go back 10,000 years, and this really hasn’t changed much at all, is if something bad happens, think about how quickly that news spreads just through your little community, your tribe, your neighborhood, whatever it has been in history.

Wes Moss [00:16:27]:
If there’s something bad happening, everybody finds out really quickly. So humans are inherently just cautious and pay attention to bad news, pay attention to scary things that could hurt them. That inherently makes us react to anything that looks not so good in the economy of the stock market. So we all inherently have that gene to some extent. I think what I have found is those who have less of an antenna that goes up on any little bit of bad news, I’m not going to call this aloofness, but those who are able to ride through these storms, their reaction to news in any kind of news, if it is slightly more muted and less reactionary than the general public, if I had to make a bet that’s an investor, over time, that probably does better. You could also say that group, there’s another group that is just slightly more optimistic in general, that they look at bad news and they say, oh, I think in general this will get better or will solve itself. And they don’t reactionarily go into the darkest of rabbit holes. They think of, oh, we’ll climb out of this.

Wes Moss [00:17:44]:
Mallory, I don’t know if I’ve ever had this question. Those are a little less reactive or not overreactive to general happenings of the world, and or those who are a little optimistic that are a little bit more optimistic than the general maybe population, with the thought that things will solve themselves or get better. And those are the investors that tend to do well because it allows them to stay invested with patience and longevity. Number three, again, we’re talking investment principles here on the retire sooner podcast. A large dose of diversification. I think this has gotten a lot easier to do over the years. It was pretty easy 25 years ago when I was first becoming really an investor, and now it’s gotten really easy 30 and 40 years ago. Highly diversified mutual funds.

Wes Moss [00:18:44]:
They were expensive, but they were almost an essential component of any long term investing strategy. But they were expensive. Today, mutual funds have largely shifted to their, call it their ultra low cost cousins, exchange traded funds, ETF’s. If you have just a collection of ETF’s, each one of them typically is going to include several hundred stocks. Not all ETF’s, but a lot of ETF’s. I would say have 100 stocks or more right out of the gate. That gives you a massive diversification oriented, call it chassis that can allow you to continue to drive for a very long time. I certainly think that owning some individual stocks, that is still fine, but not at the expense of diversification.

Wes Moss [00:19:38]:
And thinking about today versus 30, 40 years ago, there are hundreds, really thousands of different ETF options that can give you lots of diversification at ultra low costs. Meaning to buy a basket of stocks today can cost you a 10th or two tenths of a percent, versus 30, 40 years ago when ETF’s really didn’t even exist. A mutual fund that’s going to be one, two, or even 3% per year, huge win for investors. That’s made getting real diversification. So you eliminate your single stock risk more accessible and less expensive than ever.

Mallory Boggs [00:20:19]:
Can I do a side note really quick here? I remember. Cause we’ve been working together now, Wes, for a decade.

Wes Moss [00:20:26]:
Over a decade.

Mallory Boggs [00:20:27]:
Yeah, over a decade. And I remember coming on board.

Wes Moss [00:20:29]:
We were still. I was still writing. I remember when you were new, I still hadn’t even published. You can retire sooner than you think.

Mallory Boggs [00:20:36]:
You hadn’t.

Mallory Boggs [00:20:37]:
No, it was.

Wes Moss [00:20:38]:
You were helping. I remember you helping as we were editing that book.

Mallory Boggs [00:20:41]:
Yeah, it was right before it came out. I think that was like, I think your big push for bringing in some help, which I’m so grateful for, and it’s been so fun.

Mallory Boggs [00:20:50]:
But my point with this, I was.

Mallory Boggs [00:20:51]:
Just going to say it’s interesting thinking about the ETF’s and how the cost has lowered. I also remember whenever there was that big shift with the pricing from brokerage accounts where it was like it used to cost, what, $10 a trade, and that just kept dropping.

Wes Moss [00:21:05]:
That’s another great point. Right when you probably started. When I started, there were still pretty big commissions to buy or sell any given stock. 25, 30 years ago could have been a couple hundred dollars to buy a. A few hundred shares of a stock. And then the discount brokerages came into the picture, the Schwabs, Fidelitys TD Ameritrades e trades of the world, and started making that more accessible. And it was, I think at one point it was under $50, and it was $29, and then it was 19. And eventually, over the course of another decade or so, everybody just went to zero and it became essentially free to buy and sell stocks.

Wes Moss [00:21:46]:
ETF’s not only the internal costs. Mallory, good point here have come down the cost to acquire XYZ ETF has essentially gone away for most investors.

Mallory Boggs [00:21:59]:
All the more reason to diversify wisely.

Wes Moss [00:22:01]:
Yes. Number four, investing is both easier to our last point and harder, I think, than it’s ever been. Think about the information flow that we’re subjected to on a daily basis today. Information is free. It is infinite. It’s limitless. It expands every minute of the day.

Mallory Boggs [00:22:23]:
On top of that, you can find an opinion for just about everything from.

Wes Moss [00:22:26]:
Every which way, shape or form and investment options. Again, highly accessible. And lots of diversification opportunities have evolved. Financial products have evolved to become extremely inexpensive. However, all of those positives, I think, have just led to a more confusing and maybe a more challenging environment to have patience in or to have patience for. So the question is, can you navigate this on your own? Can you navigate through all these principles completely on your own? I think the answer is absolutely yes. And I don’t know the exact numbers here. I’ve read multiple studies that have given me different answers on this.

Wes Moss [00:23:12]:
What’s the percentage of people that do get some help? I’ve read 30%. Maybe it’s 50%, depending on your net worth. Maybe it’s two thirds of folks. I’ve never gotten a perfectly acceptable answer here on the amount of investors who end up using some sort of guidance or coaching. But there is a very large group of folks in the investing population that do get some help, that do get some coaching. And I think for the group that does, I think that someone alongside of you can be invaluable. It’s just like I think about exercise and working out. Lots of people exercise perfectly well on their own.

Wes Moss [00:23:50]:
They know exactly what to do. They have the discipline to do it. They have a three day a week running schedule and a two day a week lifting schedule, and the rest of the time they’re active. And then some folks need a little bit of help. And it could come from a podcast, it could come from an app, it could come from an actual running group, it could come from a trainer, could come from a coach that’s kind of making you do the right habits or guiding you to make sure you’re doing the right habits. So I think it’s just like any other behavior we have that we know is good for us if we can do it on our own. I think the environment set up better today than it’s ever been, but it’s also maybe a little harder than it’s ever been because of the confusion. And there’s lots of people out there that can help guide you through this if you find somebody that really can be that coach, and it can be invaluable.

Wes Moss [00:24:41]:
Number five, and notice we haven’t talked about any particular investment here still.

Mallory Boggs [00:24:46]:
Oh, my gosh, we haven’t.

Wes Moss [00:24:48]:
We’ve talked about ETF’s, we’ve talked about mutual funds, we’ve talked about stocks. But we. Original principle number one, mostly stocks, mostly, is a foundational principle. And the good news is we can find low cost ETF’s and there’s plenty of them to do that.

Mallory Boggs [00:25:00]:
And then you get that nice dose of diversification that we have for number.

Wes Moss [00:25:04]:
Three, all at the same time.

Mallory Boggs [00:25:05]:
There we go.

Wes Moss [00:25:07]:
This is where it all, I think, comes together. Maybe this is the glue for all of these. Know where you’re driving towards or know what you’re driving towards, aka some sort of plan. Now, for some people, this may not be the most fun thing in the world to do any sort of financial plan or write down your exact money and life goals. I find that it’s hard for people to come up with that, with those life goals, those money goals.

Mallory Boggs [00:25:36]:
These are probably not the same people that love sitting down at the beginning of the new year and saying, what are my New Year’s resolutions?

Wes Moss [00:25:42]:
Which, and again, I’ve been, maybe I’m, I guess, inherently a planner. So I’m one of those people that always writes down my yearly goals January 1 or two. I think it’s a lot of fun to do that, but some people just don’t want to do it. I get it. Benjamin Franklin, of course, said you failed a plan. You’re planning to fail. We know that. But how do you just get.

Wes Moss [00:26:04]:
What are the resources to do this? Yeah.

Mallory Boggs [00:26:07]:
Because is it just most people sit down and, like, bare knuckle it? They’re just like, I want to retire. You need some kind of way to know how much you actually need.

Wes Moss [00:26:16]:
Yeah. Okay. So there are a couple of ways to think about this. One, of course, any sort of financial advisory team can do this. And if you go to any sort of financial planning firm, or usually an investment firm, you’re going to get. You can easily get done a 25, 35, 50 page plan that maps everything out just by putting in the basic variables of what makes for any sort of retirement plan. How much we think we’re going to need in the end. How much we have today, how much we’re going to save along the way.

Wes Moss [00:26:46]:
Assumed rate of return, an assumed rate of inflation.

Mallory Boggs [00:26:51]:
That one’s hard to guess these days, right?

Wes Moss [00:26:53]:
How much? Well, again, the variables are easy. The question is, do you get them? Are they correct over time? That’s a little scary.

Mallory Boggs [00:27:03]:
That’s a little terrifying.

Wes Moss [00:27:05]:
So we’ve got think about the answers to those questions. They shouldn’t be that hard. But then there’s the thought, wait a minute. What if the numbers are not right? And here’s the reality. Of course they’re not going to be right, because there’s nothing to predict the future at all perfectly. So we just have to have reasonable assumptions, reasonable goals that we can enter in and we can get some sort of financial plan. There are plenty of online tools that do this, too. You don’t have to go to a financial advisory firm to get this done.

Wes Moss [00:27:34]:
You can go and do planning online. You can go to 100 different financial planning tools. I’ve gone through the gamut of the online tools, and there’s some good ones, there’s some not so good ones. Some are seem to be pretty straightforward, some are pretty complicated, and it’s almost like they’re trying to lose you. I even went out to go try to find some sort of software team to just put a good calculator on our website so that people could do financial planning, and I didn’t really find it. Now, I know there are plenty of institutional software products, meaning that you buy them as a company and you license them and your advisors can use them, but they’re almost so robust, you can’t just stick them online and have somebody go through it. So you have to have some sort of modified way to do some planning. And I’ve gone through phases where, and I still love this, it’s harder to replicate online, but I love just drawing out a financial timeline, sitting down with a family saying, okay, when you’re 62 or 67 or 70, when are we taking social? Let’s at least put in a date, map that out, what social is.

Wes Moss [00:28:47]:
Maybe there’s a pension that drops in another period of time. Here’s what we’re starting with, savings wise. Savings plus annual savings and an assumed rate of return in five years, seven years, ten years, 15 years. Here’s about what you should have. Use the 4% rule and back into this is probably about what you could be able to spend. It’s a little hard to recreate just this drawing out of a financial timeline on the web or on an app. So looking at dozens of different financial plan software, we just build our own. So we decided we’re just going to build our own here for the retire sooner team, and we’re going to make a combination plan that is part lifestyle.

Wes Moss [00:29:29]:
And then, of course, how do you pay for that lifestyle? So it’s a two part plan. Two odometers. What’s your odometer score on a scale one to ten on your lifestyle goals and habits? And what’s your financial odometer look like? Is it a two, three, or is it at a ten? And our team just sat down and built it. Now it’s taken several.

Mallory Boggs [00:29:48]:
Yeah, I love it.

Wes Moss [00:29:49]:
The better part of it.

Mallory Boggs [00:29:49]:
I love it. You’re like, oh, yeah, we just sat down and built it when it knocked it out in the afternoon. No, no. This thing, this took a lot of brainstorming and iterations and brought in some graphic help. And it’s a bit of a beast, but it’s beautifully simple, I think, for the end user.

Wes Moss [00:30:04]:
Right. I think it’s very, very. So it’s called the happy retirement planner. And I look at it as a really nice and quick sketch of what’s important to get to your financial goals. Lifestyle, how do you pay for it? And I think the quote that I repeat in my head, more than any other quote in the financial world over the last 20 some years, is the enemy of a good plan. Is the dream of a perfect plan. The enemy of a good plan is the dream of a perfect plan. Guess what? There is no plan that can ever be perfect because we can’t.

Wes Moss [00:30:40]:
We don’t know what’s happening over the next five years. Ten years, 2030 years, we don’t know how long we’re going to live. We don’t know how, when our kids are going to, what college is exactly going to cost. We don’t know. We don’t know exactly how much we’re going to spend when we stop working and all of those unknowns stop people from starting a plan. Well, I don’t know my exact, most common pushback in any sort of plan. I don’t know what I’m going to spend in the future. Okay, what do you think you might spend? What are you spending now? Oh, we’re spending ten grand a month now, but I have no idea what it’s going to be in seven years when we retire.

Wes Moss [00:31:21]:
There’s no way to exactly know. Well, if ten works today and in five years, all the kids are going to be out of college. Is it safe to say maybe ten is a good place to start or a little lower? Maybe it’s eight grand. But remember, we’re going to increase that for inflation. So not going to be perfect, but let’s look at something that kind of makes sense. And that’s how this plan works. I’m going to actually go through this. First of all, you can find it on yourwealth.com dot.

Wes Moss [00:31:55]:
Y o u rwealth.com dot. You can just go to. It’s right on the homepage. Go down and click on happy retirement planning tool. Or you can go to the resources tab and find another resources tab. I’m going to go through this live. So it starts out and this is, again, I think this ends up being a helpful guide that you can easily quickly modify, but it gives you a good sketch of about what you’re going to need as long as you can just come up with a couple of numbers. So I’m going to go through this and do a quick financial planning exercise here.

Wes Moss [00:32:29]:
So I come to a page. It’s got a cool picture of a beach and a hat. Looks like exactly where everybody wants to be hanging out on the beach. No riff raff, no jellyfish on shore, no people with boomboxes right next door.

Mallory Boggs [00:32:43]:
It’s truly the dream retirement spot is what I’m hearing.

Wes Moss [00:32:46]:
This is a dream. So you put in a email, you hit start, and you go through five quick questions that are lifestyle oriented. How do you currently feel about your overall social connectedness? I don’t see my friends at all. I occasionally see my friends. I frequently socialize. So I’m going to just say I do an okay job here. I’m going to pick the middle one. How do you currently feel about your physical activity and your health? I’m just going to pick the middle.

Wes Moss [00:33:13]:
How many core pursuits hobbies on steroids do you have? Next question. I’m going to say I only have two to three. I’ve got arguably, I do have a list of these. I’ve got like ten of these malheard.

Mallory Boggs [00:33:25]:
This is just a demonstration. This is just a demonstration. Also, to be very clear for our listeners, especially if you’ve been listening for a while, I expect to hear a lot of happy lifestyle pieces come into play.

Wes Moss [00:33:36]:
Next question talks about activities. What gives you a sense of purpose? We answered that question. And then finally, how confident are you in your overall retirement planning, in your sense of financial freedom, in your future income sources? I’m just going to pick kind of the middle point here and go next. Then it brings me to the financial questions. I’m just going to assume this is a plan for Jim and Susan. So let’s just say Jim is 40, he wants to retire at 65. So I type in 40 and 65. Let’s say Jim’s pre tax income is $100,000.

Wes Moss [00:34:10]:
I put in $100,000 current. How much does Jim, how much do Jim and Susan have saved? Well, they’ve got, let’s call it five hundred k. And we’re going to say how much per month are they going to save? Let’s say $1,000 a month. Again, round numbers here. And then we come into the spending. This is the tough one, right? This is the, we know we’re not going to get it perfect, but let’s get it. Let’s get a good number here. If Jim and Susan are pretty comfortable at $8,000 a month, maybe you could say in retirement, I only need seven, maybe six, but let’s just keep it at eight.

Wes Moss [00:34:43]:
If this is what you’re spending today, let’s just keep it at $8,000 a month. That’s the monthly goal in retirement once you stop working. Now, right now, the way this plan, and it’s interactive, so every time we put in a number, it changes the chart dynamically. This shows Jim and Susan are going to need about four and a half million dollars, but these numbers only get them to about 2.9. So the chart showing some red. There’s a deficit here. But there’s one more really important question to answer. How much retirement income do we think we’re going to get? Now, assuming, again, not many folks have pensions in this day and age.

Wes Moss [00:35:21]:
So let’s, particularly if Jim’s 40. So let’s assume it’s just going to be Social Security. You can, again, another number we may not know exactly. Well, I don’t know exact numbers. I can’t put it in. You can get close, you can go to SSA dot gov, get your Social Security statement. It’ll give you a really accurate number for 62 or 65 or 67 or 70. And let’s assume again this is Jim and Susan together.

Wes Moss [00:35:44]:
Let’s say together, one of them gets 2000 a month, the other gets 3000 a month. It’s five grand a month. So let’s put in $5,000 a month that Jim and Susan are going to get. Now we have life expectancy. If you hit show more, you can change the life expectancy, the pre retirement rate of return, the post retirement rate of return, the inflation rate, et cetera. But if you just leave these standard, I think the standard here is just a post retirement rate of return of 5%, trying to keep it conservative. Now, all of a sudden, because of that Social Security number, the savings number needed goes way down. It’s not 4.5 million, it’s more like 1.7 million because of the monthly income.

Wes Moss [00:36:33]:
Now, this shows that Jim Susan are going to have almost $3 million, but only need about 1.7. To do what? Fund the eight grand a month. And that’s what we’re trying to do until they are 95. Now, all of a sudden, this chart starts to work, and now all of a sudden, we’re getting something that looks like a plan. We hit next. Get an odometer that shows the lifestyle habits on a scale one to ten. How we doing financial one to ten. And puts all of this together into one, really just one five page plan.

Wes Moss [00:37:08]:
You hit download PDF, and wham, there we go. It’s a good plan. Go back and change the numbers. Get a little more aggressive on saving, get a little more conservative on the expected rate of return. Maybe you want to run it at a 4% rate of return. Maybe you want to put inflation at 3.5% instead of 3%. But it’s a tool that will get you the semblance of a guide and the semblance of a roadmap and the semblance of a blueprint so that you know where you’re headed, which is the glue to all of these financial principles. Number five, know what you’re driving towards, aka a plan.

Wes Moss [00:37:48]:
So you don’t have to use the happy retirement planner, but some sort of plan, in my opinion, just goes a very, very long way. Does that seem doable? Mallory?

Mallory Boggs [00:37:59]:
I think that sounds very doable.

Wes Moss [00:38:01]:
Okay, it’s doable. And it’s kind of fun just to go through.

Mallory Boggs [00:38:05]:
That helps, too, honestly, it’s the kind of thing I feel like it would.

Mallory Boggs [00:38:08]:
Help me sleep better at night.

Wes Moss [00:38:11]:
That’s exactly right. A little direction can go a really long way. Now, wealth accumulation, it’s for the freedom of worry that we all seek. We want freedom of worry, and that’ll never go to zero. Live in a big, scary world, worried about a lot of other things beyond just money, paying for all the lifestyle habits and activities that we want to engage in, but we’re trying to lower that worry as much as possible. And I think most of us, not all of us, but most of us, see wealth or accumulating wealth as just some higher level of freedom, do what we want when we want to do it. Even if you have plenty of money and you still worry and don’t feel financially free, then you’re not really all that wealthy. So the goal of planning and the goal of investing towards your goals is to put you in a place where you’re able to, to your point, Mallory, just sleep well at night, have a little a better sense of where financial freedom really seems to kick in.

Wes Moss [00:39:17]:
So that’s the first part of wealth. It’s the freedom. The second part of wealth is to give you a glide path to get to the point where your money is now working, just like you were working in your twenties, thirties, forties, fifties, sixties. Now your money is trying to take that working role and do it for you. And then I think part three is probably just legacy when it comes to wealth. Again, not important to everyone. So legacy important to some, not everyone, that you want your next generation, your kids and maybe your grandkids to have at least some financial freedom or leg up as well in what seems to be a world that just gets a little more difficult every day. So put it all together, we’ve got time, patience, planning.

Wes Moss [00:40:07]:
Maybe that’s just it. Some part of this, of course, is investing. You have to know something about that. But the greater part of the equation, I think, is just how we behave as investors. Time, patience, planning. I think that’s 70% of the battle, 80% of the battle. So, yes, here on the retired senior podcast, we spent a little bit of time talking about and trying to remind ourselves about these very topics, me included. Talk about the power of time, the power of patience, the power of planning.

Wes Moss [00:40:40]:
But it’s a little less exciting to talk about the year every week. That’s why we do interviews and we have guests. So it’s not just about reminding you to be patient. I think if that was it, it’d.

Mallory Boggs [00:40:51]:
Be a really boring podcast, right?

Wes Moss [00:40:54]:
It would be. I don’t even know if I could do it every single week. I don’t even know if I have the patience for that. But today’s episode is that reminder. And I think anytime you get tested and you’re thinking of not being patient and your investing doesn’t seem like it’s worth all of the mental anxiety that comes along with it, the emotional pain that watching markets go up and down and being worried, maybe today would be that reminder. So again, the investment principles here we covered today. Number one, stocks mostly. Number two, patience, longevity.

Wes Moss [00:41:28]:
Three, a large dose of diversification. Number four, investing is both easier, probably, and harder than it’s ever been. Five know what you’re driving towards, aka some sort of plan. So put it all together. That’s why we’re a mix here on the retire sooner podcast, lifestyle habits and guests that can guide us in that realm, and then the foundational behaviors that we need and the and the general market instruments that we can use. That should give you and me and us here, Mallory, you and me, a good chance, or a better chance at the financial freedom that so many of us seek to sleep well at night when it comes to money sense that we’re all looking for. That’s the retire sooner podcast. Some magic tries not to be a lot of hype, just the boring essentials that we all need on this financial journey that we’re in together.

Mallory Boggs [00:42:28]:
Hey y’all. This is Mallory with the retire sooner team. Please be sure to rate and subscribe to this podcast and share it with a friend. If you have any questions, you can find us@westmoss.com that’s wesmoss.com. you can also follow us on Instagram and YouTube. You’ll find us under the handle Retire sooner podcast. And now for our show’s disclosure.

Mallory Boggs [00:42:48]:
This information is provided to you as a resource for informational purposes only and is not to be viewed as investment advice or recommendation. Investing involves risk, including the possible loss of principal. There is no guaranteed offer that investment return, yield, or performance will be achieved. Stock prices fluctuate, sometimes rapidly and dramatically, due to factors affecting individual companies, particular industries or sectors, or general market conditions for stocks paying dividends. Dividends are not guaranteed and can increase, decrease, or be eliminated without notice. Fixed income securities involve interest rate, credit inflation and reinvestment risks and possible loss of principal. As interest rates rise, the value of fixed income securities falls. Past performance is not indicative of future results.

Mallory Boggs [00:43:28]:
When considering any investment vehicle, this information is being presented without consideration of the investment objectives, risk tolerance, or financial circumstances of any specific investor and might not be suitable for all investors. Investment decisions should not be based solely on information contained here. This information is not intended to and should not form a primary basis for any investment decision that you may make. Always consult your own legal, tax or investment advisor before making any investment tax, estate, or financial planning considerations or decisions. The information contained here is strictly an opinion and it is not known whether the strategies will be successful. The views and opinions expressed are for educational purposes only as of the date of production and may change without notice at any time. Based on numerous factors such as market and other conditions.

Wes Moss [00:01:34]:
I’m gonna let you think about this in the back of your mind. The first question I was gonna ask you is this. Give me five pajama jobs that people can do. We’re gonna start with that, but not quite, because I wanna go back to something slightly more serious. And I think of you recently have been talking about this Gallup poll that shows that Americans are working a little bit longer. And I’m sitting here thinking, we’re the retire student podcast. I’m thinking you’re going the wrong way. People are working longer, not shorter.

Wes Moss [00:02:05]:
But again, it’s that. That’s totally okay, because you think of maybe this next phase in a really positive way. How can continue to work help your overall financial plan, help your overall socialization. And you’ve done so much work with, you have so many great books about helping people that are 50 plus, really, I think 60 plus figure out their place in the workplace. Maybe it’s a second act career. So let’s start with the thought around. Over the last couple of years, we’ve seen people working a little bit longer. What do you think that’s all about?

Kerry Hannon [00:02:44]:
Well, Wes, I think there’s a couple of big trends going on here, but one factor is that people are finally starting to get it, that in fact, they, you know, trying to support three decades of financial living in retirement is kind of a daunting task, especially if they’re, they’ve late getting to the game or they worked for an employer that didn’t have an employer provided retirement plan. That makes it really super hard. So the ability in today’s world, and one of the big trends that I wrote about in my book and control at 50 plus Washington that came out of the pandemic was remote work, which used to be, oh, well, isn’t this a nice thing? And you’d beg your boss to be able to stay and work from your home office. It became something quite accepted and sort of the genie was out of the bottle. Yeah. Companies want people to do hybrid stuff these days, but if you can work remotely for someone who has retired or wants to continue working on their own terms, remote work is a real, a real panacea for all of this because you can keep earning, but you have that flexibility. And when you ask people what they really love about their jobs, they’ll often tell you it’s flexibility. That’s what they really want.

Kerry Hannon [00:04:00]:
They want to feel in control.

Wes Moss [00:04:02]:
Yeah, autonomy is. It’s funny, we were, before I walked into the studio today, one of my colleagues looked at my, I’ve got these two big double screens, you know, the wide screens, and I have two of them, and they’ve been set up for years, and I’ve used them for many, many years. And then I guess it was because of COVID I was mostly just on my laptop, which is this little tiny screen, and I’m still, I never went back. I’ve got these two big screens in my office, and then I still do everything on just the one little, not only is it one screen, but it’s a really little screen. And I think that’s why over the last couple of years, my eyes have gotten so bad. I’ve had to start where I’ve had to take my readers from one and a quarter to one. I think I have to go to one and a half now, pretty soon. But so a lot of things Covid, that period of time changed a lot.

Wes Moss [00:04:54]:
One, you’re saying people were introduced to a broader variety of remote. I so agree that if you can find something, we call this the retirement gray zone, where America tends to think of retirement is a cold turkey, black or white. Hey, I’m working now. I’m not working. The reality, to your point, you’ve got so many decades to fund for so many Americans, it really helps to have that interim period, maybe it’s a two year, three year, five year period where they’re working less or more flexible, more autonomy. So then I’ll circle back to pajama jobs. I love examples because I do. I think it’s hard for families that I’ve worked with over the years.

Wes Moss [00:05:41]:
When they get to the 60, 65 and they would like to work, it’s not always that easy for them to find what that is. So I’d love to kind of just talk through some, just some things you’ve seen where people have been able to figure out these more flexible jobs. What do they look like?

Kerry Hannon [00:05:57]:
Maybe.

Wes Moss [00:05:57]:
What are some examples of that?

Kerry Hannon [00:06:00]:
Yeah, I think remote work and working, you know, as I call them, pajama jobs is something that generally comes out of the kind of work you were doing previously. So it’s often through a relationship with a company, an employer you worked with, or a colleague who is somewhere else who you found work with that knows you. So that there’s this sort of rapport there. Like, for example, for me, I’m a writer, right? And I interview people and all of these things. We were just talking about how great Zoom is the thing is, or being able to do video interviews and things that you could never do before now. This technology is so great that I can do my entire job mostly without having to leave my home office if I choose to. As a writer now, I like to get out and meet people, and I think a lot of us do like that human interaction. So you try to build that into it.

Kerry Hannon [00:06:53]:
But, so if you have a skill, like, these are mostly white collar jobs, right? I mean, it’s going to be stuff that you can do that’s a knowledge based work. So writing, if you’re accounting, bookkeeping, if you even graphic designing or writing fundraising pitches, or all kinds of. It can be so many different fields, the medical field, doing insurance business. So it’s stuff like, what field have you been in? And how can you pivot to finding work within that sweet spot that you already have many of the skills that you don’t need to be in house asking somebody for help, but you actually know how to do the job.

Wes Moss [00:07:35]:
How often is it for people you’ve written about and interviewed over the years, how often is it part of the plan? And they’re at 62, and they say, you know, I think I’ve saved enough, but I don’t want to start tapping into my funds, so maybe I can downshift and do some sort of other job. How often are you seeing people make that part of the plan, or are they having to react to up, I’m no longer part of this company, and I’ve got to, got to go find something else that’s maybe part time.

Kerry Hannon [00:08:05]:
Yeah, that is a really great question, Wes. I think what happens is it kind of depends on how you feel at your work at that time. If you’ve saved appropriately and you are just simply burned out and you don’t see yourself seeking and striving for that next promotion, that next all of that, you’re over it. Know, then sometimes people do want to take that pause and step away, kind of do some of those things they put on the back burner to have that work, balance that balance to their life. And then they start thinking, okay, I’m ready. I’m re energized. I’m ready to re enter the workplace. So I don’t think it’s necessarily a decision they’ve made upfront.

Kerry Hannon [00:08:45]:
Many people, they kind of step away, and then they come after a period of time, say, you know what? I’m a little bored. Whether if they don’t have any great hobby or purpose or they’ve gotten involved in a volunteer opportunity and traveling, you know, they’ve kind of run their, you know, passport through a lot of checkpoints. So I just think that that happens. There are the other people that are very thoughtful about it. Like, they actually, they’ve saved enough to retire early, but frankly, they love what they do. They absolutely love their work. So they think about, okay, so I do want to have more balance in my life. How can I do that? And they do start thinking ahead.

Kerry Hannon [00:09:21]:
They start finding where they, most employers still don’t have a phased retirement, any formal program, although they’re.

Wes Moss [00:09:28]:
That’s true.

Kerry Hannon [00:09:29]:
There’s starting to think about it.

Wes Moss [00:09:31]:
Yeah. That’s a really interesting point that I don’t know if, I don’t know why I’ve never thought about this, but you’re right. The companies don’t almost at all do that. It’s fascinating that if you think about thousands or millions of companies in the United States, very few do you ever hear of any sort of phasing out? Well, I guess you can, right? If you’re a doctor, you go five days and now you’re down to three days and down to two days. So I guess it’s possible in some professions, but companies in general don’t really have a phase out path for most jobs, do they?

Kerry Hannon [00:10:09]:
Yeah, and I think there’s a reason for that because it’s expensive. Right. And if you make a formal policy, then you have to offer it to everyone. And so they tend to cherry pick the people they want to keep around because they don’t want to lose that expertise and that experience. And frankly, Wes, moving forward, employers, they are not going to have much of a choice about this because with fewer younger workers coming up to sheer population growth, we are not seeing a lot of young people there. You know, there are more people turning 65 this year than ever in history. And so the fact is they’re going to need these older workers, their knowledge, to stay on the job longer because they’re simply not going to have, you know, it’s an aging global population. It’s not just in the US that, you know, more people are over 65 than under 16.

Kerry Hannon [00:10:58]:
So through the. We’re going to see more of this. But it is starting. But I think this gives workers a lot a real chit. You know, they’ve got a little something they can play with here that if an employer wants to keep them on, they can negotiate for. Okay, these hours I want to, you know, these are the days I can work. Or maybe it’s. These are the months I want to work.

Kerry Hannon [00:11:19]:
You know, let’s do this. So I think it does give us some, some bargaining chips here, but it’s just getting started.

Wes Moss [00:11:27]:
You know, it was before. It was probably right before COVID I did a video. I think it was the five reasons people choose to retire, because there’s got to be a catalyst. It’s. It’s a, usually I see a little bit, there’s one or two things that tip people over to say, okay, now I’m done, or now I’m ready to go. And ironically, one of them, and it does make sense, but it’s interesting that one of them was traffic. So if you look back and you see the average commute times that are 45 minutes each way in pretty much any big metro, right? So LA is well known to be the worst. DC, where you are, is really tough.

Wes Moss [00:12:07]:
Atlanta is awful when it comes to traffic. From 03:00 p.m. to 07:00 p.m. and people get stuck in traffic, and they’ll have 40, 5100 ten minute commutes all the time. And I’ve seen people that be the kind of final strawberry people are like, I just can’t do this anymore. And then they go to, then they start thinking, well, can I do remote or hybridization? It was a lot harder back before COVID and now that really has gotten easier. So maybe to your point, that’s one of the reasons people are saying I’m okay to work a little bit longer.

Kerry Hannon [00:12:40]:
Yeah, I think it’s easier than ever to extend your working life with what we talked about, that autonomy, that flexibility in a way that’s going to work for everybody. And so I think that’s really important to remember. And you’re absolutely right. I mean, that commute, my goodness, that is a great reason not to do it. Other, the other big factor, and you, you write about this is health, right? Either your personal health. A lot of people say they are going to work longer, but they don’t. They say they’re going to work till 66, right, or whatever, but they do. The most people leave around 62 because of their own health issue.

Kerry Hannon [00:13:14]:
That, that makes it hard to continue working or someone they’re caring for an aging family member and because of remote work, if it’s your own health issue. And that commute was really a drag and making it really hard. Well, isn’t this brilliant? Because it can really solve that problem of being able to continue to work without the commute. The other thing I’ll say, wes, quickly, is that, like, for example, my husband just, quote, retired, but he’s actually going to continue working. He does documentary editing and so forth, but, so he stepped away from his full time.

Wes Moss [00:13:47]:
So he’s a filmmaker. Yeah, he’s an editor. He’s in the film industry.

Kerry Hannon [00:13:51]:
Yeah. So he’s going to step away from his full time thing, but I, he’s going to continue doing projects, he said. And I’m like, don’t use that word. Retire around me. You know, have you ever read anything I wrote? You know, and he’s like, well, you know, but for him, but for him, it was, the impetus to do it is he had finished a series that had just ended. It was a good stopping point. He’s 70 years old, so he worked longer than, than the people who many of your listeners are, maybe, but, but he, he did it. Cause he absolutely loves it.

Kerry Hannon [00:14:18]:
But he also started seeing people around him with his really good friends with serious health issues who are unable to do those things. They had said they were going to do. They wanted to travel, they wanted to do this. He goes, you know what I want to do? I’m healthy. I want to be able to go do some of these things. So I’m like, yeah, absolutely. Get it. You know, I think that’s a big reason to step away, is if you can, if you saved, go do what you want to do.

Kerry Hannon [00:14:40]:
Who knows what the next chapter is.

Wes Moss [00:14:44]:
If you’ve ever done a Jane Fonda workout or if you remember as a kid rocky running the steps. And if Michael keaton is still Mister mom to you, then guess what? It’s officially time to do some retirement planning. It’s Wes moss from money matters. Weren’t those the good old days? Well, with a little bit of retirement planning, there are plenty of good days ahead. Schedule an appointment with our team today@yourwealth.com. dot. That’s your. Yourwealth.com dot.

Wes Moss [00:15:16]:
So I think about this thought around the mental shift of now starting to use your money. We spent a lot of time here. We’ve had a lot of different episodes, really talking about distribution, the 4% plus rule, weighing different withdrawal rates, because it’s very scary to, even if you have plenty of money, whether, let’s say, the average happy retiree, our research shows, has about a million and a quarter of liquid assets. But it doesn’t matter. I’ve seen many a family has 3 million or 5 million or 10 million, and it almost doesn’t matter how much you have saved. It’s still, there’s still trepidation in saying, okay, no more income’s coming in, wage income, because I’m done. And now I’ve had to start living on these assets. That’s kind of a scary proposition for anyone.

Wes Moss [00:16:10]:
And I I know that you’ve, you’ve talked about this, and, and some sort of other work can help bridge that gap, the, the distribution phase of, of not being nervous, pulling from your money.

Kerry Hannon [00:16:21]:
It’s, you know, you’re right, Wes. It’s a, it’s a psychological safety net. You know, you, it’s just, it’s really nice. If you continue to earn something, it just can be that buffer. It can, it can help you, you know, not have to dip into those retirement accounts more than you absolutely have to or, you know, gives you that mad money to go, some things that you want to do without worrying, and, and you may even be able to continue to save more if you choose to. So I think there’s some real positive things of that having that little cushion that. Yeah, and because that. You’re absolutely right.

Kerry Hannon [00:16:52]:
People just are terrified about taking the money out because we’re so hardwired to save. We’re just told, save, save, save, save, save. And then nobody’s really helping us figure out a how to take it out. And, like, which accounts do we take from? It’s like this amazingly terrifying experience, and you have no crystal ball to how long are you gonna live? So, you know, the 4%, whatever. But for everybody, it’s different. And your spending habits are. It’s really. And so I, like, I remember with my husband, I’m like, okay, great.

Kerry Hannon [00:17:22]:
You can step away from your full time thing, but you better figure out how you’re paying yourself. Because what I meant is, you know, which accounts. You figure out which accounts, you know. But so luckily, and I advise everyone, work with a financial advisor to help you figure this out because it really can be quite tricky.

Wes Moss [00:17:38]:
We think of it as, how do you max out what you can take out without running out?

Kerry Hannon [00:17:44]:
I love it. Yeah.

Wes Moss [00:17:45]:
And the other big part of that, too, is tax planning. Right. So it’s, it’s not only is it where your assets are located between different accounts really matters on your overall effective tax rate, which can be managed pretty effectively when you’re in retirement, if you’re being smart about how you’re distributing the money back for the spending that you need. I guess my other question is, what is the workplace like now? If you’re 60 plus, and I know you’ve written a little bit about working with younger folks, I think in my mind, what would it, if I were 60 and I had a 30 year old boss, I don’t know how I could handle that. I think that would be really. That would be really tough.

Kerry Hannon [00:18:27]:
Yeah. I don’t know. I think you would check your ego at the door. I think you can do it. I think you can do it. My. The thing I love about the inner generation, the multi generational workplace, we’ve got, like, five generations in the workplace now, and it’s really great. I mean, there is so much we can all learn from each other and.

Kerry Hannon [00:18:45]:
But it comes down to. There are two basic things. It comes down to respect for the other person that they’re in that job for a reason, and communication. Right. How are we going to communicate? Because each of the generations likes to communicate differently. And I will say, and just a quick note to your first question, like talking about 60 plus in the workplace, ageism is alive and well. Remote work kind of can help a little bit. There because you’re not standing, it’s not a visual.

Kerry Hannon [00:19:13]:
You’re right next to somebody who’s so much younger. But I’m going to say quickly, in my situation, I started a full time position at Yahoo finance two years ago from, I’d been running my own business, which I still do as well. But this is fantastic. The, my, the manager I report to is to probably, I never even asked her her age, but she’s roughly two decades younger than me. Right. And we don’t talk about this, but the fact is I have never, I, first, I’ve never been so energized by my work again because I’ve been writing about work and jobs and retirement for years. And she brings to it this new lens, this new way of looking at, this way of looking at it that, where I’d gotten a bit jaded, I’m like totally excited and energized. And she’s so smart.

Kerry Hannon [00:19:56]:
So it’s really been, I never expected that. But the one, what is it?

Wes Moss [00:20:01]:
What is it like, what would tell me that’s interesting. What’s the perspective? So she would be, I guess, that we’ve got, in the workforce, we’ve got Gen Z, millennials, Gen X, boomers. Is there another one? What’s the, is there a fifth one?

Kerry Hannon [00:20:15]:
Well, we got, well, we got some younger. Well, I don’t think boomers, there’s nobody above boomers. I don’t think. Still going, are there? I’m not sure.

Wes Moss [00:20:22]:
Yeah, I think boomers is probably the top of the category.

Kerry Hannon [00:20:24]:
Yeah, I would say so. But, but so what do they think?

Wes Moss [00:20:27]:
What are, what are these 20 somethings or 30 early thirties? What, how do they look at the workforce differently than the boomer generation? I’m Gen X. What’s it, I love to hear that.

Kerry Hannon [00:20:39]:
I just think they’re not, the communication is a bit different. Like, I remember when I started. And so she’s, I’m saying she’s Gen X, right? I think I’m boomer.

Wes Moss [00:20:50]:
But we’re, she could be a millennial. Millennials can be up to like 40 years old now, I think.

Kerry Hannon [00:20:55]:
Yeah. So the thing is, the first thing is with communication, I would send after they hired me, I would send emails, texts, phone calls, no response. I’m like, well, what the hell did they hire me for? And then all of a sudden I realized that she only communicated with, you know, her team via slack, which I had never worked on slack. I didn’t even know what it was particularly. I’d written about it probably, but I had never used it. But instead of me complaining or acting like a, I just figured it out and I started how to do it and I started using it and it was instant communication. But that’s on me because I didn’t ask her, I didn’t say, how do you like to communicate? That’s a simple question. So I think everyone bears some responsibility.

Kerry Hannon [00:21:38]:
And in technology, they always say someone who’s older is not going to be as adept with the technology as somebody who’s younger. And it’s frustrating. And for me, they say, Carrie, guess what? We work in Google Docs. I’m like, well, that’s great. I work in word. And they’re like, well, no, we’re not going to do word. I’m like, I’ll just file it to you and work. No, no, you’re going to work in Google Docs.

Kerry Hannon [00:22:00]:
Instead of freaking out, I called a friend of mine, Mark Miller, who works for Reuters, and I’m like, I knew he had switched over. I’m like, tell me you love Google Docs. How does it work? And he’s like, screen share. Then he gave me a quick tutorial. He’s about my age. We did a quick tutorial and he goes, and Carrie, if you can’t figure it out, just google it.

Wes Moss [00:22:18]:
So you just made, which is a really good point, is that the leap for someone who is, let’s say, hasn’t used? There is this prevailing thought. It’s like if you already don’t know a technology, that you for some reason get stuck in your current tech and you can’t learn the new one. And to your point, that’s not a good, first of all, it’s a very low barrier to overcome moving from word to Google Docs or moving from text to slack. I mean, this is not crazy rocket science, and I think it’s intimidating for some folks, but it’s certainly not. So now let’s go to the next iteration of hey, there’s no excuse not to know how to use AI chat. GPT perplexity. There’s so many of them now. Is that the next leap that the baby boomer needs to embrace?

Kerry Hannon [00:23:12]:
I think to a certain degree, and I think, wes, you really talk about this a lot, too. It’s this word curiosity, right? It’s, you need to, if you want to stay in the workplace at whatever it is, whether it’s part time work, contract work, whatever it is, if you want to be part of the workforce, you need to be up to date with whatever the technology is in the field that you’re working in it is just non negotiable. And it’s so easy these days to, if cha chibutee do it, just do it. You know, be curious about how it works. Don’t say, oh, I don’t know how that, you know, just try it. It’s so, like, it’s so easy to get information these days about how to do new things that it’s. And again, another trend that came out of the pandemic was that learning, you know, online and virtual learning absolutely exploded the ability to learn almost anything online without having to go to a bricks and mortar place, without having to get a degree, you know, four year degree or any kind of masters. You can pick up cherry pick skills, you can just learn one thing and, and it’s really quite a revolution.

Kerry Hannon [00:24:19]:
And I think that if you’re curious about life and about learning, you’re going to be able to keep on working, but you have to. It comes down to your mindset.

Wes Moss [00:24:29]:
Let’s go back to the millennials for a second. Let’s, again, let’s say you’re my boss. Let’s say I’m 60 and my boss is 30. Besides the communication difference. So let’s say they want to communicate on slack versus text. What is their thought around the workplace? How do they differ from a baby boomer and how you see work and your job and your career versus how do they see it?

Kerry Hannon [00:24:52]:
You know, I think they have a better grip on a work life balance than we do. They do. I honestly do. I think, not that their work ethic is strong as well, but I think they’re really much better at drawing that line in the sand and saying, you know, I’m off now. I’m not responding to this, these messages. I mean, me, I’m up at five, I’m sending people and I’m like, nobody’s going to be looking at their slack here, you know, but the thing is, I’m awake, so I think everybody else should be. So. But, but I think also just, I think they’re better at it than we are.

Kerry Hannon [00:25:24]:
I think there may be a little bit more, and this is just an over a general comment, less willing to go see the long term. There’s more job jumping within the younger cohort than there is in the boomer. Boomers tend to be much that when we have our whole careers tended to be stick with it a little bit longer with employers, they jump jobs more quickly. They’re moving to the next thing. They, they don’t always like we. I feel like an old timer, when I say stuff like, we really were willing to do really crummy jobs to keep moving up the ladder, you know, it’s like, I remember being a fact checker, you know, it’s like you did it, you did the dirty work so that you could get a chance to get that next step. Today, I think there’s a little more expectation that they’re going to move up faster, and in order to do that and get more money in order to do that, they change jobs. This can work, right? I’m not saying it doesn’t, but so I just think there may be a different outlook, but I think the most important one is, is this work life balance, and maybe they’re onto something there and they’re also saving at much younger ages.

Kerry Hannon [00:26:35]:
And part of it is, I think, because of the, there’s more employer 401 ks were really just starting.

Wes Moss [00:26:41]:
Yeah, they basically were just starting in the eighties. Yeah. Early nineties.

Kerry Hannon [00:26:44]:
And nobody told us what to do. And if you were lucky, you know, you figured it out, but now there’s much more education on it and employers are now, this auto enrollment stuff is amazing because instead of procrastination, people are automatically, until getting put in their retirement. Is it? You know, I just think it gets people started. And once you start saving, you keep saving.

Wes Moss [00:27:07]:
It’s like working out. Once you start running, it’s easier to keep running.

Kerry Hannon [00:27:10]:
Yeah.

Wes Moss [00:27:11]:
I want to ask about men versus women in the workplace as we’re, let’s say 55 plus 60, trying to figure out that next phase or another second act career. But maybe we just start out with two. The advantages. So we think of, you’ve talked about ageism. It exists, however, the perspective that you have, too, on why older workers are so valuable, and you talk about this, they’re really team we’re in, and that’s really productive. They’re less likely to be looking to hop jobs if they’re in this final phase of working. There’s maybe a little less ego, a little bit more willing to work, but I think one of the fears that I’ve always had, and I think one of the barriers is the thought that, oh, well, I’ve been in the workforce for a long time and my salary has just incrementally continued to go up. So I’m kind of expensive relative to someone who is willing to do my same job for 30, 40, 50% less.

Wes Moss [00:28:14]:
Is that not an issue or is that kind of a myth that I still hold in my head?

Kerry Hannon [00:28:19]:
You know, I think it’s, it can be an issue for sure. But I do think it can be costly for an employer to have to pay to ramp somebody up in order to train them for what they need. So, for example, I often, we know, relate back to my experience at Yahoo. Finances. I absolutely love working there, but I think they hired me because I could get the job done now like I needed. No training, no ramping up, nothing. Zero. So it was, and I think a lot of employers right now that were coming out of a tight labor market, they really want to find people who can step in and do the job with the skills they need today.

Kerry Hannon [00:29:00]:
And that’s a real advantage for an older worker and their pay. So, yes, now I don’t think that, you know, it doesn’t have to be more expensive. And you can also negotiate for all kinds of things around the corner, like more vacation or, you know, play with your benefits a little bit. There are ways that you can feel whole without having to have that big salary bump as you move up because we’ve often, yeah, you do plateau, but you also plateau in terms of your energy level and enthusiasm for your work if you’re not seeking a new opportunity. And wes, one of the most important things for someone who’s older in the workplace is what we were just talking about, this learning thing, because if you’re not learning, learning new things is what keeps you excited about your job, you know? And so even in my position, I’ve written about retirement and working jobs for years. I would never write about Social Security and Medicare because, oh my gosh, so confusing. If you make any mistakes, everyone’s all over you.

Wes Moss [00:29:59]:
But in this job sidebar, so true. I used to take calls on my radio show about Social Security and you could get 99% of it correct, but there’s always some nuance and immediately I would get emails. Well, one thing you didn’t say, you failed to mention you didn’t or it really. And at some point, you’re right, I used to be intimidated about writing about Social Security just because if you don’t get it perfect, you immediately get ten comments or emails about what you missed, let alone if you were to get something a little bit wrong.

Kerry Hannon [00:30:34]:
Yeah.

Wes Moss [00:30:35]:
So it took me a long time to kind of restart. I just published something about it.

Kerry Hannon [00:30:39]:
It’s so heated, you know, and even now more so than ever. But the thing is, I’ve had to write about, that’s my, that’s what I write about for them a lot now. So I’ve had to become an expert in this area and it has been so great intellectually because I’ve had to learn new things, you know, and so that’s kept the job kind of the adrenaline up, a little excitement in it. And I’ve had to meet new people, new sources, new experts that now I get invited to conferences and I talked. I’m like, ah, amazing. Like a whole new set of people.

Wes Moss [00:31:07]:
Are you intimidated, by the way? So we could talk about Social Security for just a second, too? Do you feel great about it now that you’ve been doing this for a couple of years and you’ve kind of been forced to?

Kerry Hannon [00:31:15]:
Oh, yeah, no, it’s fantastic. I have no regrets at all. I’m actually delighted because, you know, it is so important that people understand that. And, you know, with my work and I’m sure with yours that, you know, I have this mission statement that everything I do, I want to be able to make a positive impact in somebody’s life from a financial standpoint, whether it’s, you know, their work and their job or making good financial and investment decisions and giving them that encouragement and that confidence. And so Social Security, we are all dealing with this at some point in our lives. It’s a big issue of our day. So I’m really glad I know more about it than I ever did, and I’ve embraced it.

Wes Moss [00:31:52]:
With 11,000 plus people turning 65 every day, it’s staggering. Staggering to even think about that number. Yeah. And then I also think about, well, five years ago, it was 10,000 people a day. I was just thinking that not only are 11,000 people a day turning 65, there are also 10,000 people a day turning 70, because that was the big group five years ago.

Kerry Hannon [00:32:14]:
Yeah.

Wes Moss [00:32:15]:
So it’s a massive shift. If you start to think about the demographics of America and the work of the aging workforce. We’ve been talking about that huge baby boomer number for so many years, we still say turning 65, but there are 10,000 people a day turning to 71, 72, et cetera. So my point is we need more people that are confident speaking on Social Security than ever because there’s more people seeking that advice. So I think it’s great that you’re doing that. Be Lawrence Kotlikoff. Right. Gotta be.

Wes Moss [00:32:46]:
He can’t be the only guy that talks about Social Security. What, what is kind of your favorite thing?

Kerry Hannon [00:32:50]:
You think he’s not afraid to say what he thinks, and that’s what I love.

Wes Moss [00:32:54]:
He’s amazing.

Kerry Hannon [00:32:55]:
But, you know, one thing I wanted that I thought we would have fun talking about, too, is this whole idea of staying in the workplace a little longer, even if you’ve saved appropriately to retire early, is this idea of entrepreneurship. And, yes, I think it is huge for this demographic, for it is a great way that you can for many, whether you’re giving back and starting a nonprofit of some kind, whether you’re starting a business and a hobby, something you’ve been passionate about for years and that you haven’t had time to do it, whether you’re starting a business with your kid or with your nephew or with your, you know, intergenerational new businesses. But studies have shown that workers entrepreneurs, the older entrepreneurs, are more successful than younger entrepreneurs because of all those things. Wes, you said at the beginning there we were talking about, you have this sort of gravitas in the workplace. You have confidence, you know things that you have experience. You’re not, you know, you stay the course. You have a network. You know how to market things.

Kerry Hannon [00:33:57]:
You know yourself. You know what you’re good at, what you’re not good at, and you know how to delegate. Like today, with virtual work, you don’t have to have a whole team of people working for you in an office. You can, with contract work, exploded after the pandemic. You can find yourself a bookkeeper who’s going to helicopter in once a month and someone do your social media for you. It’s brilliant.

Wes Moss [00:34:22]:
Pretty recently, I guess, I’ve seen, as I look at the economy, and I’ve seen, I think we’re pretty clearly going into a new productivity boom similar to what happened in the late nineties with, with the advent of the web, the Internet, and the interconnectivity of what it did for almost every company. And now we’ve got this advent of artificial intelligence and what that can do for so many different industries. So I think we’re going into somewhat of a new productivity boom. But I’ve also seen the rise in business applications to start businesses. And I wonder if some of that was sparked by the pandemic or some of it is. Maybe what you’re talking about is that you’ve got a lot of experience. What kind of ventures have you been seeing people start?

Kerry Hannon [00:35:09]:
Yeah, well, I definitely, this was a big trend, big surge coming out of the pandemic for all age groups, but, but older, older workers in particular, over, I’d say over 50 in particular. And just a reason for that. One driver was really. It’s hard for us to remember, I must say right now, how frightening the pandemic was when we were locked down and it was scary and you didn’t know what the heck was going on. And people had a chance to do that soul searching, that inner MRI and say, you know, wow, is this what it’s all about? Like, is this what I really want to be doing? And, and they gave themselves permission to take that leap to try something new. And I think that’s been a real seed of the entrepreneurship, the new applications you’re seeing today. I think a lot of that is stemming from that, that people saw that, you know, it’s precious that, that life, and we’ve all lost people during that time to Covid, and honestly, it jet setted it. But it had been happening before.

Kerry Hannon [00:36:07]:
I wrote a book I never told to get rich. And, and I meant that in a way that, yes, of course I want everyone to get rich financially, but it’s also a way to get rich in an, in a way that’s emotional, that’s in well being. That by doing work you love and starting a business that you’ve always wanted to do, it is so rewarding. And you don’t, you know, it’s easier than ever to do this. You don’t have to have a million dollars to launch your own business today. You can start quite small with baby steps and then see it grow. Give it a chance to breathe and grow.

Wes Moss [00:36:40]:
Yeah. Do you see, from a practical standpoint, let’s say somebody in the back of their head for a long time has thought, I’d love to have my own business. How do people get off the starting block where they end up? They still haven’t done it. Is there any sort of catalyst or tool or suggestion that you would have to help people take the next step to figure out their entrepreneurial journey or. I love the idea of hobby income. I think we’ve written about hobby income. Once in a while, a hobby will turn into something that you can have some sort of profit on. But is there, have you seen any sort of particular steps that get people to kind of beyond square one when it comes to starting their own business?

Kerry Hannon [00:37:25]:
Yeah, I think you really, you know, you have to be honest. You have to say, you know, why me? You know, why now? Why this business? You know, because there’s so many businesses out there. Why? What do you have that’s going to make it that’s different than what somebody else has? So it’s really, if you’re interested in starting your own business, you really have to just, you know, all of the entrepreneurs I’ve interviewed over the years, years. I started off with a book called what’s next? Which people who did something for 20 years and shifted to do something completely different. They all did different businesses, but there is a common core, and they took their time. There were, like, no rash moves. They got their financial house and orders so that they, you know, they paid down debts. They were lean and mean so that they didn’t, because they, you know, you’re not going to be able to pay yourself out of your business for the first couple of years.

Kerry Hannon [00:38:13]:
And so they added the skills or the certifications they needed. So they talked to people in those fields to see where the holes were, where they might fit in to, you know, and they really, you know, it usually took about five years to make that pivot so it doesn’t happen over.

Wes Moss [00:38:27]:
Wow. It took that long. It took that long for people to kind of manifest.

Kerry Hannon [00:38:32]:
Yeah. You start off with, literally, you’re working your main job, maybe, and you start off doing it on the side. You start at, you know, moonlighting or, you know, going and job shadowing people who are in these fields. Anything you can do to really, because, you know, I have a woman, I know who, she took early retirement. She was from a law firm. She was a lobbyist here in Washington, and she loved to garden. And she’s like, ah, I’m going to start a landscaping business. You know, and she’s a fantastic gardener.

Kerry Hannon [00:39:00]:
But when she and she had clients, because we’re all like, yeah, you’re fabulous. But when she got out in the garden, she realized she hated it. Like, she was so miserable because it was her hobby. It was something that was the respite from the craziness of Washington lobbying. And so she quickly got her act together and stopped, you know, and when it. So you really do need that time to make sure and it’s okay to make mistakes. The other thing is, people think it’s forever. Gosh, no.

Kerry Hannon [00:39:26]:
I mean, this is like, it’s like a patchwork quilt. You might do something for a while. When I went back to that what’s next? Book. After a few years, I redid it as a paperback. A third of them had moved on to something else. So keep it in mind that people get caught up. It’s not your linear career. Yeah.

Kerry Hannon [00:39:41]:
If you’re starting a business, fabulous. And if you have a younger partner going in, even better, because that gives it a chance to keep going, but you’re doing it for different reasons. I think.

Wes Moss [00:39:52]:
I do love the idea around curiosity that not only do we have to continue to have that, but so many Americans, and we’re a big telecom town in Atlanta. Bell south was here. And then of course that was at and t big business in the southeast. And I think about folks that work either have worked or have just retired from a big telecom company. There’s a lot of longevity there. Utility companies, telecom companies. You’ll see people work for 30, 35 still to this day, 40 years at the same company. And it’s hard for them to make a big shift because they’ve been with a company for a long time.

Wes Moss [00:40:32]:
But the hard thing about that is that it’s hard to keep learning and doing something new. And that’s why I see people get kind of downtrodden after a lot of years at the same company because it’s hard for them to keep doing something new and learning something new. So your point about curiosity and sparking that within is such a big part of the formula, the recipe, to find something for another three or five or seven years after your primary career. I think your point around making it something you’re learning new is just such an important point.

Kerry Hannon [00:41:07]:
Yeah. Because when you learn something new, your whole brain shifts. Everything about you start seeing things differently. And it’s really, you could be learning about glassblowing. It doesn’t matter what it is, it just shifts your brain cells and it shifts the way you start and it builds resilience. Right. You go from being a beginner to being an expert. Wow.

Kerry Hannon [00:41:27]:
It’s amazing. Then you have to go back to be a beginner again. And this sort of rhythm of life is a really important lesson. The other thing I should say is when we’re talking about entrepreneurship, we’re not talking about starting Uber. We’re talking about micro businesses. Right. We’re talking about things that, you know, a mother and daughter starting one hot cookie in Youngstown, Ohio, they started by making cookies in their kitchen. We’re talking about, you know, people who are doing things on a small scale that have the opportunity to get bigger.

Wes Moss [00:41:55]:
And if you think about retirement planning, a few thousand dollars a month can be a really important extra cash flow.

Kerry Hannon [00:42:04]:
Absolutely. And again, and you don’t. If you’re careful and you’ve planned a bit and you are financially fit, you can do this without going into debt and all sorts of getting yourself in trouble and having those contract workers is lovely because then you can build a team to help you and support you without all this overhead. So I encourage people to give it. You know, if that’s something they’ve always wanted to, why not? But going back to that other point is you don’t get trapped. That it. Oh, you made this decision and it’s forever. It’s not forever.

Kerry Hannon [00:42:35]:
It’s, you’re not going to spend 30 years doing it, you know, because you’re going to shift.

Wes Moss [00:42:39]:
You’re going to move unless it’s one hot cookie, and that can turn into a big business.

Kerry Hannon [00:42:43]:
And it has. Now they, they have a great online business. They’ve got standalone shops in Ohio. I mean, they might go into franchising. I mean, but they started just mom and daughter, and this was, they’re just lovely. And, but there’s, you know, or a woman who, she started, it’s a wine, it’s an urban winery kind of cafe in young Santa. She retired from the military. She started this little cafe, but it’s grown and it’s a nice business for her.

Kerry Hannon [00:43:09]:
She left with, or, I mean, I love this story about a guy. This isn’t an entrepreneurship thing, but in a way, he retired from the military and he had mandatory retirement, and he was a captain in the navy. Big, you know, really could land carrier jets. I don’t know. He was amazing. He could have gone to work for the defense department or flying commercial aircraft. He ran away with the Big Apple circus because he absolutely loved the circus from the time he was a little kid. And he would go with his dad in Baltimore, and then whenever he was deployed or stationed for the military, he would find a circus.

Kerry Hannon [00:43:43]:
He got circus magazines, and so he ran away. He was the company manager. He is a company manager at the Big Apple circus, moving a troop up and down the east coast. His wife was a nurse. She became the wardrobe designer. And, you know, I’m like, don, what does this have to do with your skills from the military? And he’s like, because I always tell people, you’re just redeploying your skills. You’re not reinventing yourself. He’s like, terry, it’s all, he’s.

Kerry Hannon [00:44:06]:
The military and the circus aren’t that different. And he said, the fact is, the fact is, all those leadership things, all those qualities that I had to use in my position in the military, I just transferred them. It’s logistics. It’s managing people. It’s, you know, getting things done on time. It’s project management. So anyway, I just. Or, yeah, I can tell.

Kerry Hannon [00:44:26]:
Another quick one, is this guy you lost?

Wes Moss [00:44:28]:
Yes. I love these. I love.

Kerry Hannon [00:44:29]:
He lost his job because of ageism. He calls it ageism. I don’t know. He was a top sales guy, did great, but he couldn’t get back in. He couldn’t find another job. So he’s. This was fairly recently. He was a really terrific sailor.

Kerry Hannon [00:44:41]:
He loves to sail since he was a kid, so he got frustrated. Oh, wait.

Wes Moss [00:44:44]:
Hold on, hold on, hold on. So he’s a sales guy, but he’s also a sailor.

Kerry Hannon [00:44:48]:
Good point.

Wes Moss [00:44:49]:
You’re trying to pun me here. I’m listening.

Kerry Hannon [00:44:53]:
Yeah, good ears. So anyway, he decided he got fed up with the job search. He went to Longbow Key, Florida, to teach sailing for the spring, and he’s out on this boat with the CEO he’s been given private lessons to all week, and he’s telling his guy his story. And the guy said, well, you know what? We’re looking for a project manager at my company in New Jersey. And he said, you should apply. And the guy’s like, why should I apply? I don’t know. I don’t have anything credentialed to be a project manager anywhere. And he goes, you’ve just been sailing with me the last week, getting from a to b to this.

Kerry Hannon [00:45:28]:
He said, you’ve shown me that you know exactly how to manage a project. And the fact of the matter is, people don’t often see these inner skills they have in their hobbies that translate to the work world. And so, in fact, he did go interview for this job. He got the job. Okay. He knew the CEO. But it’s been fantastic. He got those certifications.

Kerry Hannon [00:45:45]:
He’s been promoted twice. You know, it was a good win.

Wes Moss [00:45:49]:
So he doesn’t miss sailing because my takeaway doesn’t.

Kerry Hannon [00:45:52]:
Poppy.

Wes Moss [00:45:52]:
Now, I guess he can afford it even easier. Easier to afford the takeaway from that story, though, too, is that it’s never too late to learn how to sail. Carrie.

Kerry Hannon [00:46:04]:
Yeah. Oh, like it.

Wes Moss [00:46:06]:
Like, it’s never too. And again, for somebody, that. That has been. One of the evasive things in my world is that I’ve sailed a lot because my wife’s family is. They’re. They’re sailors, and they sail. They grew up sailing. They sail.

Wes Moss [00:46:20]:
They all have their own sailboats. Some are little, some are big. And I’ve always. I’ve been a passenger sailing so many times. I’ve probably gone sailing 50 times in the last 15 years or something. So I’ve done a lot of day sales, but I have never captained the boat. But I have this thought that at some point in my life, and I guess you can take. And I hadn’t really ever thought about this, but you can take sailing lessons and just learn.

Wes Moss [00:46:50]:
And I’d love to do that. I don’t know if I’ll do it this summer when it’ll happen. But that’s on my list of, I’m very curious to be able to sail my own boat as opposed to go on a sail.

Kerry Hannon [00:47:02]:
Yeah.

Wes Moss [00:47:03]:
Complete sidebar, Carrie.

Kerry Hannon [00:47:05]:
I know. I love that. But that’s what all about working jobs is, too. And everything we do in our life, it’s being curious and being, and you know, that open, being open to trying new ways of doing things because we all get stuck in. We want to replicate. I was like, you get stuck in a moment. I think that was a YouTube show, you two song. But you get stuck.

Kerry Hannon [00:47:24]:
You want to replicate. You know, you’re paralyzed because this is what I’ve always done. I don’t know, but, but all of these things that you’ve done, these skills, you can pivot those out to doing other things if you like, give yourself permission and also give yourself permission to fail. Okay. It’s not going to be, it’s not, every day is going to be rosy. You got to, like, be realistic. But, but it, the joy comes from trying. And I know that sounds really woo woo, but it’s so true.

Wes Moss [00:47:50]:
All right, well, if I get seasick in the middle of my sailing lesson, I will continue to prevail. How about purpose, play and happiness and longevity? This is something I think you’ve talked about and written about a little bit, but kind of this purpose and play and enjoying work. I’d love to kind of hear your thoughts on that.

Kerry Hannon [00:48:07]:
Yeah. I think particularly as we get older and we want to find work with meaning. But I do actually think younger generations want the same thing. They want work with meaning. Like, there’s something in the human spirit that we want to feel like we’re making an impact in the world, that there’s some. But as we get older, I think there’s a stronger urge to want to give back and to do something that you really feel is outside of yourself and living beyond yourself. And so a big opportunity at this stage in life is to use some of these skills that we’ve kind of honed over these years and repurpose them to doing this kind of thing, to finding purpose with. There’s like, you know, several kinds of purpose.

Kerry Hannon [00:48:48]:
They’re going to be a small purpose where you’re just, you know, doing acts of volunteering and things like that, which is really important to do, or there’s bigger things, you know, if you’re launching a bigger initiative in order to find a way to give back. So I think purpose in having purpose and having a reason to get up in the morning and feeling relevant is just good for your health. I mean, there’s no question about it. And working is good for your mental health because it’s use it or lose it. You’re still solving problems but having something in your soul that has this purpose, you can’t measure that in a way that I could explain it that say, oh, you got to do that. But it definitely study after study shows that it absolutely contributes to our wellness.

Wes Moss [00:49:27]:
So you’re an advocate, even if you don’t need to financially, you’re an advocate to really just work as long as you can for the most part. Would you, would you agree with that?

Kerry Hannon [00:49:39]:
Do, but only in the, if you have the opportunity, do it on your terms, do it on things that are going to turn you on. And when you’re excited about your work and you, that translates into the quality of the work you’re doing and the impact you have on other people. I mean, it shows, it carries through. But that enthusiasm also helps with your network and your human engagement. We all need that social network. So that’s one thing people miss when they step away from the workplace is that connection, that human connection. So, you know, there are ways to seek it out and do it. But often work is a nice avenue for doing that because it makes us feel good about ourselves because we’re rewarded for our expertise and our, and that sort of thing.

Kerry Hannon [00:50:21]:
But we also give back to others. Like, it’s really fun to help younger people figure out the ropes, right? I mean, there’s something really great about, about sort of mentoring and the reverse mentoring both ways, but the Robert De.

Wes Moss [00:50:37]:
Niro, don’t you love that?

Kerry Hannon [00:50:39]:
Where do you think you’ll be in ten years? And he’s like at 80? I don’t, you know, but that’s a great, it’s a fun example of that. But it happens. And I just think there’s, there’s a lot of fun in that, you know.

Wes Moss [00:50:52]:
As I kind of connect the dots here, it’s almost as though if you can get to a point where you have work on your terms and it’s got purpose and you’ve got, it sparks your curiosity. That’s a huge bargaining chip when it comes to the retire sooner lifestyle. The way I look at it is that it is if you’re able to get into that next phase totally on your terms. To me, that is part of the retire sooner formula. So I’m going to leave it with this. Today. You’ve written, I would say at least a dozen books. Has it been a dozen?

Kerry Hannon [00:51:25]:
Yeah, a little over a dozen.

Wes Moss [00:51:26]:
Let’s say it’s a dozen. A baker’s dozen. What is your favorite book that you’ve written that you would steer people at our audience to take a look at?

Kerry Hannon [00:51:35]:
Yeah. Like, turn it back on you. It’s so hard because we love all our books. Right? They all. They all have.

Wes Moss [00:51:41]:
No, I don’t love all mine. I have a few that I think are terrible.

Kerry Hannon [00:51:44]:
I do love mine, but I will say the most recent book, I like in control a great deal because I think it’s really great information.

Wes Moss [00:51:52]:
In control.

Kerry Hannon [00:51:53]:
In control at 50 plus. How to succeed in the new world of work. It talks a lot, all these things. Entrepreneurship, you know, women in entrepreneurship. It talks about learning and contract work, remote work. But. But I also love that book I referred to earlier. My what’s next book was really magical for me because I spent.

Kerry Hannon [00:52:12]:
I was. I spent three and a half years traveling around the country, meeting people who had made these big pivots in their life. And most of them were boomers, and they were. They were seeking meaning and questing and giving back, and oh, my God, I didn’t want to do what they did, but I wanted to be like them. I mean, I was so inspired by their. Their, um, their vision and their belief in themselves. And so I think it’s really important. Uh, and that’s a message I try to get through with all my books is, you know, no one can create this path for you but yourself.

Kerry Hannon [00:52:43]:
But. And so at the heart of it, you got to believe what that. That you can do it and that you have something to offer.

Wes Moss [00:52:50]:
All right, we’re going to wrap it up. So, Carrie, thank you so much for being here. I’ve been a big fan of your work for a lot of years, so I’m glad we found you. So God bless Zoom for you being able to come on and it’s been great to be able to meet you and talk through. You have such a deep knowledge base. I love these stories, too. I love. Some of these stories are great, too.

Kerry Hannon [00:53:09]:
Good, super fun. I appreciate you reaching out to me because you know what I mean? Your work is fabulous. And the thing is, it’s just the more voices we get out there, I think people just educating people and giving them the chutzpah to keep moving.

Kerry Hannon [00:53:23]:
Hey, y’all, this is Mallory with the retire sooner team. Please be sure to rate and subscribe to this podcast and share it with a friend. If you have any questions, you can find us@wesmoss.com that’s wesmoss.com. you can also follow us on Instagram and YouTube. You’ll find us under the handle Retire Sooner podcast. And now for our show’s disclosure. This information is provided to you as a resource for informational purposes only and is not to be viewed as investment advice or recommendations. Investing involves risk, including the possible loss of principal.

Kerry Hannon [00:53:53]:
There is no guaranteed offer that investment return, yield or performance will be achieved. Stock prices fluctuate, sometimes rapidly and dramatically, due to factors affecting individual companies, particular industries or sectors, or general market conditions for stocks paying dividends. Dividends are not guaranteed and can increase, decrease or be eliminated without notice. Fixed income securities involve interest rate, credit inflation and reinvestment risks and possible loss of principal. As interest rates rise, the value of fixed income securities falls. Past performance is not indicative of future results. When considering any investment vehicle, this information is being presented without consideration of the investment objectives, risk tolerance, or financial circumstances of any specific investor and might not be suitable for all investors. Investment decisions should not be based solely on information contained here.

Kerry Hannon [00:54:38]:
This information is not intended to and should not form a primary basis for any investment decision that you may make. Always consult your own legal, tax or investment advisor before making any investment tax, estate or financial planning considerations or decisions. The information contained here is strictly an opinion and it is not known whether the strategies will be successful. The views and opinions expressed are for educational purposes only as of the date of production and may change without notice at any time. Based on numerous factors such as market and other conditions.

Wes Moss [00:00:31]:
Love for you to be one of them.

Wes Moss [00:00:33]:
Let’s get started.

Wes Moss [00:00:36]:
How to handle a market sell off typically, here on the retire student podcast, we are what would be called Evergreen, meaning that our content and our shows are about topics that are good today and tomorrow and six months from now and a year from now. Even though we talk about markets, we’re talking about markets typically in general and not what happened yesterday or this past week. Because the nature of listening to podcasts is you listen a week later or two weeks later, or this is not the medium for, hey, what happened yesterday or today, at least the retire sooner podcast is not. With that, though, as you are listening to this podcast, whether we are in the middle of a market correction or the correction that really started in July of 2024 has totally wiped itself out and everything’s back to normal and the markets are back at all time highs. Who knows? But we just went through an event that is something that happens to investors over and over and over again. It may happen once a year or twice a year, may not happen for two years, may not happen for three years, but it happens over and over and over again in market history. And that’s market selling off. And in this case, not just a steady sell off over the course of a couple of weeks and a couple of months, but a really big waterfall down day.

Wes Moss [00:02:00]:
Almost what we had very recently in markets is almost a flash crash. In the beginning of August. It wasn’t called a flash crash, but we had a period of time where the Dow Jones industrial average had its worst day in two years, down 1000 points during one day. In that same day, Japan, the japanese stock market, the Nikkei, was down 12%, 12% percent in just one day. Big global stock market sell off. And although we’re talking about the current event of the day, regardless of where we are in markets, when you listen to this, this particular episode, this is something that we all have to deal with as investors over and over and over again. And it hurts almost every single time, no matter how much you’re prepared for it and how much you understand market history and how good of investor you are. It always stings a little bit.

Wes Moss [00:02:57]:
I’d say on a scale one to ten, maybe for Warren Buffett, it stings only at a one because he’s totally fine no matter what, and he doesn’t even worry about it. But maybe he worries about it at least a little bit. So much so that he may be a buyer on a big sell off, or he may do something all the way to someone that feels these selloffs at a ten and it really bothers you. That market’s sold off and you’re close to retirement, and you’ve got a couple million dollars invested and it’s down by multi percent in just a couple of days. And the dollar signs are huge, down 100,000, $200,000 in a couple of days. Even for veteran type investors, that can hurt or sting a little bit, or at the very least, just be unpleasant. So our episode here today is designed for you to pull out and listen to. Anytime this happens, anytime there’s a big sell off, anytime there’s a crises, flash crash, market panic scare, you name it, the VIX, the volatility index.

Wes Moss [00:04:01]:
When that goes up and through the roof, you may want to listen to this episode. Now. It’s prompted by what happened in late July, early August, here in the year of 2024. But again, I think it applies to all of us more than we would like it to, because these sell offs do happen over and over again. I want to start out with just a bottom line of why the 2024 sell off that happened so quickly. A couple of things that were the catalysts of that. Number one, the Federal Reserve has been front and center for the last. I don’t know, maybe they’re always front and center, but very much on investors minds in 2024, we know that they kept interest rates almost at zero, well, at zero for a very long period of time.

Wes Moss [00:04:49]:
And then over the past year and a half to two years, went on a hiking campaign. They ratcheted rates up over and over and over and over again to the point where now, again, depending on when you listen to this, rates at the five and a quarter to 5.5% range for the federal funds rate much higher than zero. So, number one on my kind of bottom line to start out today, is the Fed. To some extent, you could say that they are behind the curve. They’ve held interest rates just too high for too long. Look no further than the log jam in the housing market. Look no further than the big rise that we’ve seen in unemployment. The unemployment rate has essentially gone from 3.4%, a historic 50 year low to 4.3%.

Wes Moss [00:05:37]:
Even though 4.3% is still not all that high for an unemployment rate, it’s gone up a lot over the course of, call it the last year or so. And that has gotten everyone’s attention, including the Fed, who may be a little bit behind the curve and have held interest rates maybe too high for too long. And the market’s waking up to that. Number two, the most recent sell off. And every sell off has its own unique fingerprint and DNA, and you can always find a reason of why we sold off at this particular time. But most recently, an unwind of an overheated, mono focused technology slash artificial intelligence trade that really has knock on effects for other areas of the market. So let’s say technology was perceived to be overheated, investors exited stage left, and as they’re running for the exits other areas of the market, we get a broader market sell off, even though the culprit or the catalyst started in one particular area that was perhaps overbought for a period of time. Again, as I talk through this, I think insert date, insert sector, insert another area of the market that got too hot for too long, sold off, and then did some damage to other places in the market.

Wes Moss [00:06:52]:
I think we certainly have seen that in the year 2024. Number three, corrections are unpleasant, but they’re not uncommon, and very much just part of the process. This is what stock prices do. The prices we see in the equity markets are overly emotional, both up and down, recently down that we pay attention to due to the pain that that causes. But it doesn’t mean that all this won’t pass, and that economics and earnings numbers that are tied to all of this are damaged forever. It doesn’t mean that they’re damaged forever. In fact, it’s quite the opposite. There’s a cure for this or any time markets sell off precipitously.

Wes Moss [00:07:36]:
And it’s simply time and progress that we know we’ll eventually make. Here in the US, we know that over the course of market history, stocks are up about 7% net net of inflation in almost any 20 year period you look at, and 7% above inflation, the way I’m arriving, that is about 10% growth on average, 3% inflation. So a net of 7% is really tough to beat. Not everyone experiences that net seven of inflation due to the shakeouts that come on a relatively repeated basis. The investors, though, that do realize that compounded rate of return, realize that the downdraft du jour or of the moment really is temporary and not permanent. And those are the investors that prosper over time. The trick to making money in stocks is to what? Not get scared out of them. The chart I have in front of me shows market drawdowns from.

Wes Moss [00:08:47]:
If I had my glasses on, I could read this 1928 through the year 2023. What percentage of years did we see a market drawdown of the following magnitude? How about 15% or worse? Well, 40%. Almost half of stock market years from 1928 to 2023, almost 40% of years saw a 15% or worse downdraft, 20% or worse bear market 26% of the time. So a quarter of those years, one in four on average. Then corrections of 10% or more, 64% of years, and corrections of 5% or more, 94% of years. So literally happens all the time, almost in any given year. So drops in this five to 10% range. Happen all the time.

Wes Moss [00:09:42]:
Literally, they happen all the time. Another historical market piece of data that’s important to remember and remind ourselves is that on average, again, going back to the late 1920s, the normal or average drawdown in any given year is about 16.3%. That’s the average drawdown in any given stock market year. But it doesn’t mean it doesn’t hurt when it arrives. Recently, the Dow Jones was down over 2000 points in just a couple of days. 2000 points. Ooh, that hurts. That’s what makes investing so hard for so many people.

Wes Moss [00:10:27]:
Why, you ask, do I subject myself to these swings? They’re so big. They’re so violent. They’re so unsettling. What’s the point? Is it really worth it? Well, it’s the pain that is the point. The pain is the toll of long term stock ownership in companies that happen to reside in the stock market that is full of the world’s collective emotional highs and lows. And there are no highs without lows. That’s the toll. That’s the price of long term market and investing success.

Wes Moss [00:11:07]:
If you’ve ever done a Jane Fonda workout, or if you remember as a kid rocky running the steps, and if Michael Keaton is still Mister mom to you, then guess what? It’s officially time to do some retirement planning. It’s Wes moss from money matters. Weren’t those the good old days? Well, with a little bit of retirement planning, there are plenty of good days ahead. Schedule an appointment with our team today@yourwealth.com. dot that’s y o u ryourwealth.com dot. We all know the long term averages of owning stocks and owning bonds. Owning stocks simply means you own a little slice of the american pie and hopefully, depending on what you own, let’s assume it’s the s and P 500 versus being a creditor or a bondholder to those companies or the government. If you were to be a bondholder versus a stockholder, we know what history tells us.

Wes Moss [00:12:02]:
Stocks have compounded at about 10% per year, again, 7% net of inflation. Bonds around 6% per year, only about 3% net of inflation. And that’s a big difference. Real terms are a big difference, meaning that what did I make? What was I able to keep after the insidiousness of inflation? 7% in real terms. Real terms are the only terms that really should matter versus 3%. That means stocks, again, on average here, looking at the S and P 500, have compounded at more than 100% per year above what bonds have done over time. We all know this. These market statistics have been published thousands and thousands of times in thousands of articles and books and anywhere you can and look up market data.

Wes Moss [00:12:56]:
So why don’t we just all own just stocks? I think it’s because of weeks like we just saw over the last few. Simply not all of us can take the pain of these downdrafts, the pain of a big minus sign, however temporary it might be. It can hurt. And the future is unknowable. We never know exactly what is around the corner. The future is unknowable. It’s totally uncertain. And there’s always the worry that, hey, maybe this time it is different.

Wes Moss [00:13:28]:
And the biggest, strongest, most innovative companies in the world, maybe they won’t prevail. Possible, but not probable. And it is within that sliver of doubt that separates the investor, the owner of companies and the saver lender, the stock investor versus the bond investor. By the way, that’s okay. The good news is that there are plenty of options for every single individual one of us to reach our financial goals, reach our life goals that we’re intent on paying for. So balance really is our friend. And balance, in my opinion, allows us to be the equity stock owners, investors that we each individually have the capacity to be. Meaning that having some dry powder, aka safety investments, that gives us more capacity to be able to invest a reasonable percentage of our retirement assets in diversified stock oriented investments.

Wes Moss [00:14:30]:
Put more simply, dry powder safety assets, that allows us to be better stock investors. So a balance with a little bit of safety, I think just allows those of us who otherwise couldn’t withstand the mental burden of bungee cord stock markets up and down to in fact be able to participate them at least in some capacity, some exposure to the category equity ownership that has the long term history and track record that suggests that it will take you the furthest in the fight against inflation. What’s the real risk here? When markets sell off, we immediately think, wait a minute, I’m getting whips sold. I’m getting whipped around thinking that the risk of these markets on these big downdraft days in general is what? Losing money? Loss of principle. But that tricks us from understanding the real risk. And the real risk is what? The bigger fear is that we outlive our money in large part because it gets decimated by inflation. We have to keep spending more and more, and our assets haven’t kept up with inflation. We end up running out.

Wes Moss [00:15:46]:
And that is perhaps one of life’s biggest worries and fears. We all know that inflation reduces the value of the paper dollars in our wallet, the paper dollars. Hence, we know that the only way to protect against those wilting dollars that is stuck in a wallet doing nothing is to have them placed in places that are most prone to outpace inflation. So my message here today, and hopefully this is helpful, particularly the next time we have another big market correction or sell off that raises the hair on the back of your neck, is a reminder to not let these big bumps along the way shake you out of the long term trends that are likely to really help us with our long term goals. Now, if you’re a regular retire sooner listener, sometimes I feel like I’m just preaching to the choir. I’m thinking if you’re listening to this, you’re probably right in line saying, I’m good with these markets going down. I get it. These losses, I can ride through the storms, the bumps.

Wes Moss [00:16:48]:
Eventually the America will be better and we’ll be higher for longer when it comes to stocks. And I’m just preaching to the choir. Yeah, wes, I get yes, you’ve said this before. I get it. We know stocks are going to be okay. I’m not worried. Then my mom calls, who also knows this and also listens to retire sooner and says, hey, wes, are stocks going to be okay? Mom, over time, I think absolutely. I can’t tell you where they’re going to be at the end of the week or the end of the month or even the end of the year.

Wes Moss [00:17:21]:
But over time, yes, I really believe they’re going to be okay and probably much better than okay. But it’s going to be painful to get there. Lots of slides backwards. But remember, if you have the patience and the fortitude and the conviction that the economy, the markets broadly, will be okay, and I think better than okay. Over time, then, yes, we’ll take these rough patches. We’ll take these tough days, these tough weeks, these tough months, these tough years, with a steady view that is not just in the valley, but beyond the valley, because that’s where we’re all headed. What’s the one thing that all of these historical market scares have in common? Every route and panic and flash crash, every crises, crisis meltdown, every correction, every bear market, what do they all have in common? Producer Mallory is staring at me saying, hmm, what do they have in common? They’re all gone. They’re all recovered.

Wes Moss [00:18:25]:
The broad market has recovered and erased them. Maybe not the most current one, depending on when you’re listening, but they’ve recovered and erased them by advancing to higher ground in some capacity. Eventually. Two steps forward, one step back, three steps forward, two steps back, five steps forward, two steps back. And so it goes. The next time the market sells off, you can’t sleep. You get worried. Are you off course? Just have a quick listen to this exact episode.

Wes Moss [00:19:00]:
Maybe it’ll help. I hope it helps. And thank you for listening to the retire sooner podcast.

Mallory Boggs [00:19:08]:
Hey y’all.

Mallory Boggs [00:19:08]:
This is Mallory with the retire sooner team. Please be sure to rate and subscribe to this podcast and share it with a friend. If you have any questions, you can find us@westmoss.com dot. That’s wesmoss.com. you can also follow us on Instagram and YouTube. You’ll find us under the handle Retiresoonerpodcast. And now for our show’s disclosure.

Mallory Boggs [00:19:28]:
This information is provided to you as a resource for informational purposes only and is not to be viewed as investment advice or recommendations. Investing involves risk, including the possible loss of principal. There is no guaranteed offer that investment return, yield, or performance will be achieved. Stock prices fluctuate, sometimes rapidly and dramatically, due to factors affecting individual companies, particular industries or sectors, or general market conditions. For stocks paying dividends. Dividends are not guaranteed and can increase, decrease, or be eliminated without notice. Fixed income securities involve interest rate, credit inflation and reinvestment risks and possible loss of principal. As interest rates rise, the value of fixed income securities falls.

Mallory Boggs [00:20:06]:
Past performance is not an indicative of future results. When considering any investment vehicle, this information is being presented without consideration of the investment objectives, risk tolerance, or financial circumstances of any specific investor and might not be suitable for all investors. Investment decisions should not be based solely on information contained here. This information is not intended to and should not form a primary basis for any investment decision that you may make. Always consult your own legal, tax or investment advisor before making any investment tax, estate or financial planning considerations or decisions. The information contained here is strictly an opinion and it is not known whether the strategies will be successful. The views and opinions expressed are for educational purposes only as of the date of production and may change without notice at any time based on numerous factors such as market and other conditions.

Wes Moss [00:00:39]:
Enter doctor Mike Rucker, an organizational psychologist, behavioral scientist, and a charter member of the International Positive Psychology association. His ideas about fun and health have been featured in the Wall Street Journal, Fast Company, Forbes, and more, and he currently serves as a senior leader at the active wellness and is the author of the best selling book the Fun Habit. Mike uses his rucker play model to rank fun activities according to their level of challenge. The answers and the timetables may be different for everyone, but embracing the overall need for joy and togetherness can help us avoid the unhealthy distractions that come along with isolation. The reality of modern life is that we don’t have as much free time as we might want. But with a little bit of self empathy and Mike’s creative outlook, we can find some ways to dial up the fund meter and increase our happiness. I’m wes Moss. The prevailing thought in America is that you’ll never have enough money, and it’s almost impossible to retire early.

Wes Moss [00:01:48]:
Actually, I think the opposite is true. For more than 20 years, I’ve been researching, studying, and advising american families, including those who started late, on how to retire sooner and happier. So my mission with the retire Sooner podcast is to help a million people retire earlier while enjoying the adventure along the way. I’d love for you to be one of them. Let’s get started. Before we talk about autonomy, let’s maybe get your definition of you’re the guy that talks about fun. Everybody wants to know how we can do more of it. Just what does it mean to you? I mean, it’s kind of like the only reason we really are living, right? Shouldn’t we?

Mike Rucker [00:02:26]:
Well, I think it’s definitely an important part and one that know for so.

Wes Moss [00:02:31]:
Many different purpose and fun. Purpose and fun.

Mike Rucker [00:02:33]:
Yeah. And those two can coexist nicely, I think. But we’ve been led to believe, you know, by various measures that sometimes the way we go about things has to be through martyrdom. And there are different reasons. You know, it’s a complex issue. Some people have really bought into the idea of meritocracy. So it’s sort of like, I work hard, I don’t enjoy myself, but I’ll get the fruits of that labor sometime out in the future. For some, you know, it’s the protestant work ethic.

Mallory Boggs [00:03:00]:
Right.

Mike Rucker [00:03:01]:
Like, if somehow I’m enjoying myself, there’s this latent guilt, which is very strange and hard to unpack, but it still seems to exist.

Wes Moss [00:03:09]:
Yeah, I’ve got that, by the way. That’s one of my issues, the way I grew up.

Mike Rucker [00:03:13]:
And it’s interesting, a lot of times you can dislodge that just by simple reframing. And I think we’re starting to understand that more. But it is. It’s an inherent sort of this ideal that work is virtuous and it’s not meant to be enjoyed. And what a shame, right? And then you have the adage right next to it, you know, that you enjoy your work. You never work a day in your life. And so those two can’t really coexist. And yet we see some of the most successful people be the ones that are enjoying what they do.

Mike Rucker [00:03:47]:
And when you think about it scientifically, right, definition of fun I often give is just things that you enjoy that you’re drawn to. Like, if you don’t like the work you’re doing, then why would you keep doing it? And we know that that’s true. That’s why we’re seeing this record level of burnout across all vocations, especially here in North America. And so finding ways to tip the scales into at least, maybe not necessarily making it a circus, but figuring out ways that people actually enjoyed the. The time that they spend is important. And so the concept there is, and we kind of touched on it at the very beginning, is looking at affluence not in just the sense of financial measures, but also time.

Mallory Boggs [00:04:32]:
Right?

Mike Rucker [00:04:32]:
So financial affluence gives you this tool, money, to be able to make a wider breadth of choices. If you look at time the same way, how can I control this scarcity asset? I mean, truly an asset that you can’t make more of. We don’t know how much we have, but you can’t make more of it. The people that look at it critically like a product of affluence. So I want maximum control over the 168 hours I have in my week. We just know through empirical research these are some of the most happy people. And so you can kind of partition off finance as a vehicle, because certainly we know that the access to different things is going to augment the human experience. But it’s clear that when you pair those two together, people that have a bias towards wanting to be time affluent and have control over their schedule so they’re not serving others and giving everything away tend to be the ones that in the moment and retrospectively are describing themselves as happier.

Wes Moss [00:05:45]:
However, here we are in America, where we’ve read about doctors have this massive burnout rate at something like over 60%.

Mike Rucker [00:05:55]:
Yeah, last year was the worst.

Wes Moss [00:05:57]:
It was, what, 60?

Mike Rucker [00:05:58]:
It was something three. And that was the highest number we’ve seen ever.

Wes Moss [00:06:04]:
And then I always go back to the, I’ve tracked Gallup polls on workplace satisfaction for a long, long time, for almost 20 years. I’ve always been fascinated with that. And that’s if you look at, in North America, it’s really around the world, but particularly in North America, where you have a really small percentage, let’s call it a third or even less than a third, which means of people that really are engaged and love what they’re doing. And then you’ve got the other two thirds. I mean, two out of three people are in the take it or leave. I call it the take it or leave it camp. So they don’t hate it, but they don’t really like what they’re doing. And then, of course, you’ve got a huge chunk of people that hate their jobs so much, they’re actively trying to bring their companies down.

Wes Moss [00:06:48]:
And they call, Gallup calls it quiet quitting and loud quitting. But it’s basically people that just could work sucks for a lot of people. And is that just a function? So think about all of the work you have done around this time. Autonomy and so many books around happiness and economic freedom, yet it’s such a high level that it just. People don’t achieve that.

Mike Rucker [00:07:11]:
Yes. What I’ve found as, like, a broad base, common issue is we’re starting to realize that access to leisure. And when I say leisure. Right. Some of these words are triggering like pleasure. Oftentimes in North America, people immediately go to intimate pleasure.

Mallory Boggs [00:07:29]:
Right?

Mike Rucker [00:07:29]:
Yeah, I do. And the same with.

Wes Moss [00:07:31]:
That’s what I think, leisure.

Mike Rucker [00:07:33]:
Right. They’re thinking about that one vacation they take a year, but leisure just means access to time that’s not necessarily reserved for productivity. Right. And we’re starting to learn that if you don’t at least have some partition, you know, within your day or some sort of leisure, you know, being able to reduce that cognitive load on chewing on big problems so that you’re actually relaxing the limbic system. If you are, I call, quote unquote fun start. Its essentially the same consequences as being sleep deprived. The issue is its more insidious and its a slower burn, right? So if week after week youre not finding joy in anything that youre doing, what happens is slowly but surely you start to identify as not being a joyful person. And what can happen is once that identity is sort of set, you start to find artifacts, right? We can all succumb to confirmation bias.

Mike Rucker [00:08:31]:
And once that happens is like, you know what? Life just isn’t meant to be fun. Right? Now, no one says, especially the sandwich generation that so many of us find ourselves in, right? We’re having kids a little bit later. Our parents are living longer. They’re living longer, and we had kids later. So our parents generation likely could get help from their parents. And we’re not seeing that as much. We’re actually seeing, you know, Gen Xers having to take care of both sides. So they’re some of the most time poor people we’ve ever seen.

Mike Rucker [00:08:59]:
And they were taking this stoic look like, you know what, this just isn’t meant to be a fun period. But what happens if you’re not enjoying, you know, anything? One, there’s physiological and psychological effects. We just know that. But the other real problem, and in my academic work, I’ve looked at physicians specifically. And so im making a broad based statement on just what I know about physicians. Once you get in that state of burnout, you lose empathy. And so what I know empirically is when physicians lose empathy, the patient outcomes falls off a cliff. Anybody can look up that research.

Mike Rucker [00:09:37]:
But what I would suggest is if we looked at that through a broader lens, you would see that lack of empathy affect everyone around, right? Tangential research and social contagion sort of proves that, right? If you’re near a bad mood all the time, you tend to pass that on to your loved ones and the ones that you interact with. But I think, too, when you see burnt out parents, they’re approaching childcare as I have to do this instead of this amazing opportunity that most of us only have 18 years anyways, and kind of just throwing that away, right? Like, I’ll get through this. It’s just something that I have to take the kid to soccer practice or I have to get them out of the house. Right. Instead of kind of reframing it and going, yeah, I can create amazing opportunities with these people that presumably, you know, were by design anyways.

Mallory Boggs [00:10:30]:
Right.

Wes Moss [00:10:30]:
And so do you think, Mike, though, the problem is it stuck within our workplace, our american culture of work. And you mentioned the protestant upbringing. I actually, ironically grew up as a Quaker, and now I’m part of the presbyterian church now. So it wasn’t a protestant upbringing, but I guess it felt, maybe feels like that in retrospect, is not being. Allowing yourself to have, quote, fun because it’s not productive. And then, so then we get into a society, or in your case, doctors, wherever we’re enduring these phases and just saying, look, this is just tough. Like work is just tough, and I get burned out and then they have a lack of empathy and parents can do it. It just sounds like it’s societal at this point.

Mike Rucker [00:11:20]:
Yeah. And again, it’s a complex issue. Right. So everything that you said, you know, has factual underpinning. The piece that we haven’t brought up yet is certainly the advent of technology and knowledge work. So, you know, our parents didn’t necessarily have to answer emails at the end.

Wes Moss [00:11:37]:
Of the day, 24/7 all the time.

Mike Rucker [00:11:39]:
Right. And so they knew when their work day ended. Right. You know, now we call that a transition ritual. They didn’t need a term for it because it automatically happened. They left work, their mindset, you know, on the drive home, they were able to reset, and then they dealt with domestic life in a way that was different than work life. Now, you know, we’re still on a conference call. When we walk in the door, we wonder why our kids are on a screen, right? We’re telling them not to be, but we’re modeling the behavior we’re telling them not to do.

Mike Rucker [00:12:07]:
And then what we know from the neuroscience is it does, it doesn’t allow us to leave work. So even if we do put the phone down and still have dinner, if it was only a few minutes earlier, we’re still chewing on that email we got from our boss. That kind of pissed us off. So we’re not there present with the loved ones. Right. Dopamine has been talked about way too much, but the undervalued neurochemical is oxytocin. That’s what you really get from this pro social behavior, whether that’s your partner, your friends, or your family. And a lot of that is lost because of this always on mode that we find ourselves.

Mike Rucker [00:12:46]:
So that’s another piece of.

Wes Moss [00:12:47]:
Wait, what do you mean? I’m sorry. Explain pro social to our listeners. What’s that?

Mike Rucker [00:12:52]:
Just engaging with your friends, people that you want to spend time with so that you don’t feel lonely. Right. Robert’s great book, the Good Life, was about that huge Harvard study, and if you believe the data in it, and it’s really well done study over a long period, loneliness has more of a physiological impact than things like smoking and sitting and so making sure that you feel connected to others. And I would argue that fun is an amazing glue to make sure that happens, you know, becomes a vehicle for good mental hygiene at that point. So, yeah, sorry, it’s kind of a geeky word for just saying, hanging out with people you like.

Wes Moss [00:13:32]:
Pro social. That’s what I’m going to start saying. It’s like, guys, look, we need to be a little more prosocial. I like that, though. So let’s go back to just the overarching word that I ended up originally writing a book about. I used the word happiness, right? It was all about happy versus unhappy retirees. And by the way, I’m sticking with that. But I’ve also opened, I understand that happiness is not necessarily the perfect word for that.

Wes Moss [00:13:58]:
It’s just a nice umbrella word. So what for you, what is the essence of fun? And then how does that maybe differ a little bit from what you say is happiness?

Mike Rucker [00:14:08]:
Yeah. And I think. So let’s start with why happiness works in the context of your work, right. I think all of these are contextually relevant.

Mallory Boggs [00:14:17]:
Right?

Mike Rucker [00:14:17]:
And so in the field of psychology, we did need this idea of happiness. We boiled it down to this idea of subjective well being. But when we’re doing our work, we need to know whether or not we’re moving in the right direction. So for your work, are these retirees moving in the right direction? Is the outcome that we’re hoping for happening? Where it became problematic is, as we began to really elevate the word, it was always outcome focused. And what happened is we started to over prescribe this idea of good vibes only, and that if you had a bad day right, then somehow something wrong was happening. And what happened over time is we found that and myself included. As you know, I unpack in the book, if you’re thinking about that day in and day out, you start to ruminate on the fact that happiness is out here in the horizon, right? Maybe when I finally retiree, and you ruminate on that gap between where you are today and where happiness is supposed to be. And so folks like me early on that were like, yes, happiness is the end goal, actually sent people on the wrong path.

Mike Rucker [00:15:27]:
And we know there’s been amazing work in this area from Doctor Aris Mauss at a cal, but it’s been replicated by others. Once you get in that state of rumination, it then subconsciously gets into the identity like we talked about or, and so, you know, you might have been living a joyful life doing the things that you wanted to do, but all of a sudden, because, you know, you’re, you’re focused on this future state, you’re like, well, I meant happiness is out there. It’s not here. So I must be an unhappy person, right.

Wes Moss [00:15:57]:
Eventually. Right. And it kind of keeps moving the goalposts further away. Well, eventually, eventually it’s that proverbial carrot.

Mike Rucker [00:16:04]:
In front of the horse. Right.

Wes Moss [00:16:05]:
You know, and the horse never gets it.

Mike Rucker [00:16:08]:
Exactly. So fun is an action orientation. It’s a reminder that we really can have joyful moments. You know, there’s this new word called microjoys. If that works for you, that’s fine. But we can create these moments in our day to day, generally whenever we want to, as long as it’s done in a healthy manner and it’s not a form of escapism or, you know, you’re skirting, you know, whatever purposely driven life you have or, you know, obviously the duties that you have for others. But when you look at time use studies, even the busiest people, right, which like single moms that have a full time job, they generally still have 14 to 20 plus hours that they can reclaim. If they’re looking at that with the eye of I want to make deliberate choices instead of this fixed mindset of I have no control over this, or again, because weve already committed the knot that this is a bit complex.

Mike Rucker [00:17:08]:
Some folks are kind of weighed down by that guilt and you were kind enough to sort of confess that that can happen to you sometimes. Certainly happened to me. Right. And so if youre another piece of this puzzle is we were kind of conditioned to believe time equates money.

Mallory Boggs [00:17:23]:
Right.

Mike Rucker [00:17:23]:
And so if Im spending an hour with a friend at a comedy club, moneys flying out of my pocket. So we have all of these headwinds, yet we know, similar to sleep, that if we’re not doing it ironically, we’re not productive the next day. We don’t want to show up to work. We don’t want to do the things that actually fill us up and lead to betterment and lead to fulfillment. So we need that piece.

Wes Moss [00:17:49]:
Yeah. And one of the things I know you kind of talk about is that we have to kind of first come to that realization that it’s a requirement, right. It’s like you gotta shed the guilt or shed whatever is holding you back from doing it and incorporate it, literally, in any given day. So I’d love to even hear, can somebody as busy as a doctor who also has this heavy, heavy responsibility? So it’s a heavy job, and it’s a busy job. How does that person then, if they’re in a rut of not having any fun at all, how would you help? Or how have you helped groups like this turn it around?

Mike Rucker [00:18:31]:
Yeah. And I’ve learned a lot since the books come out with regards to the need to do it slowly. Right. We know that any kind of behavior change, it’s just like January 1, right. When you go to the gym and you’re like, I’m gonna lift 280 pounds by February. Pretty good recipe for disaster, right? So there are a couple things here. One, you know, you want to take baby steps, and so just figuring out one or 2 hours that you can reclaim, you know, and so whatever that is for you, whether that’s kind of refixing the idea that you couldn’t go out on a Thursday, you know, whether that’s, you know, kind of habitual behavior that you’ve done that, you realize, like, I gone to this group every Saturday. I don’t like the people there.

Mike Rucker [00:19:20]:
I don’t enjoy the time. When I look back, I can’t remember what I did, because I kind of feel like it’s unimportant. An important first step is to try and find spots where you can change your circumstance. Because certainly what we don’t want to do is prescribe fun to someone who’s super busy. Right. Then it just becomes, in medicine, we call this moral injury. When there’s this workplace wellness initiative, we’re like, hey, you know, we know you already have rounds for 70 hours. Now we want you to do yoga for another five.

Mike Rucker [00:19:48]:
Right? Like, that’s just. Anyways, that’s a whole nother.

Wes Moss [00:19:53]:
I love that, Mike. Literally, it’s like, some of these things are laughable, really, is what you’re saying.

Mike Rucker [00:19:59]:
And the best of attention. Right. Because, you know, these things work, but they don’t work if you’re so exhausted that you can’t implement them into your life, right.

Wes Moss [00:20:07]:
So we’re gonna have fun. We’re gonna do yoga, and you’re gonna do it with ten people you don’t really like anyway. Yes, that happens all the time.

Mike Rucker [00:20:16]:
One of my favorite anecdotes, sorry for the quick aside, but it was another organizational psychologist that was just talking about how funny escape rooms have become for team building exercises. So you have nine fellow colleagues that you hate, and what we’re gonna do to make it better is lock you all in a room together.

Wes Moss [00:20:38]:
That’s so true. That is so true. It is funny. It’s like escape rooms today are like the. I don’t know, the baking bread of COVID 2020. It’s like, that’s okay. What do we do? For some reason, it’s like a viral thing now.

Mike Rucker [00:20:54]:
It’s like, well, in the right context of super fun, my daughter’s birthday was last weekend, and with friends that she wanted to be with. Right. They had an amazing time. So I’m not villainizing them, but I do think it’s funny. These things that are really with the best of intention, but we don’t think through the longitudinal aspect of what the potential consequence in addition to the reward will be. So, going back to your initial question, I think if people find themselves in this state, it’s one. How can you free up some time? Because generally there are things that you can remove from your schedule when you look at it critically. So whether that’s doing an entire 168 hours, you know, audit of your time, which tends to be a heavy exercise for someone that’s burnt out or just saying, you know what, I’m going to just pick a couple things and integrate that.

Mike Rucker [00:21:44]:
You know, just this week, I’m going to do the thing. I’m going to find micro joys. The second important step is to check in with yourself afterwards. You know, in the book, I reference research from Cassie alms out of visa laden, and she has a simple intervention where she just asked people to go into their weekend thinking it’s a vacation. A reminder that this is your respite, right? This is your chance to do the things that you want to do. She doesn’t give them extra money or doesn’t ask them to change up what they do. In fact, when she looked at what they did, if they still had to mow the lawn, they still did it, if they still had to. Whatever they had habituated, that still tended to happen.

Mike Rucker [00:22:27]:
But in those little moments that they had, even in their busy lives, when they were more mindful, they’re like, hey, yeah, maybe we should go do something fun, because this is the weekend. But even more beneficial is they’re the ones that showed up Monday at work ready to work, and this is backed up again. I know I’ve thrown a lot of geeky science out here, but anybody that wants to latch onto the science is in line with the hedonic flexibility principle. And so what we know is that folks that are deliberate about their transition rituals are deliberate about making play dates with their friends, even as obnoxious as having to schedule those things out, because we are busy people. They’re the ones that show up and are actually more productive at work. So ironically, their work product and what they’re producing is more they’re actually enjoying life. They’re on an upward spiral where the folks that are living through this lens of martyrdom and I just got to grind it out weekend and wake out eventually are burning out, find themselves on this downward spiral. And now we know what the end result is.

Wes Moss [00:23:33]:
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Wes Moss [00:24:00]:
dot. That’s your wealth.com dot. So explain the hedonic flexibility principle. Maybe take me down to like a fifth grade level.

Mike Rucker [00:24:13]:
Yeah, no worries. So really simply what it went out when the idea was kind of brought forth. And there’s an amazing, there are a bunch of different studies, but if you google it, you’ll find the big 128 thousand folks in the study. So it’s not just a little pilot study. Harvard, MIT, Stanford Data researchers did this social scientist and what they were set out to do is this idea and philosophy that we’re pleasure seeking animals, that we try to avoid pain, and that we’re always kind of seeking pleasure. And so it turns out to be true that if you are living a joyless life, you do tend to look for ways to escape that pain. Poor forms of escapism like drinking again, getting lost in work. Fine, I’ll just answer emails, you know, eleven at night, or even passive things like, you know, doom scrolling on news, or, you know, just things to sort of alleviate what we call negative valence, which is essentially just a fancy way of saying feeling shitty, right?

Wes Moss [00:25:18]:
Yeah.

Mike Rucker [00:25:19]:
But what surprised them, and what was kind of amazing, especially in the context of my message, is that the folks that did take time off the table for themselves, that were deliberate about finding moments of joy in their schedule. So what I call having their fun cup foiled were the ones that actually seeked out harder challenges because they didn’t need more fun in their life. They knew it was there and always accessible. And even if they had a terrible week, they knew the next week they probably could change their circumstance. So these were the ones that were actually seeking out harder challenges, getting to work and going, what can I do today to make myself better? Because I already know funds out there. And there was actually this second component that I feel is equally as compelling. So not only paradoxically, are they more productive and actually enjoying work, right? Because they’re not so depleted. They hate everything.

Mike Rucker [00:26:12]:
They’re actually some of the most innovative. Because when we’re burnt out, and most people can relate, when I share it this way, when you’re burnt out, you rely on your algorithms, right? You’re like, I just need to get through today. I’ll just, you know, I know what to do. I’ll go from point a to point b, the day will be done, and I can finally get to sleep, right. But when you show up with vigor and vitality because you know you’re enjoying things, then you have that resilience to be like, you know what? Maybe I’ll break a few eggs today. Like, you know, I don’t. This isn’t really exactly how I want it, but I’ve got some time and mental capacity to kind of chew on this.

Wes Moss [00:26:49]:
And so your creativity blossoms.

Mike Rucker [00:26:52]:
Yeah. You can bring a nonlinear ideas together more easily. You’re not reliant on doing it the same way because you’re not exhausted. And you. Again, this is kind of tangential research, but you tend to be more resilient, too. So if you do do something wrong, you don’t look at it as the day wasted. You’re like, okay, well, I’m going to have to throw all this away, but who cares? It was fun. It was a playful thing that we did.

Mike Rucker [00:27:19]:
And so all of those are benefits from kind of living this balanced life with regards to enjoyment and then the things that you do find purposeful and harder.

Wes Moss [00:27:31]:
Can you put this in the context of maybe increasing? You’ve talked about how we can’t just do it overnight. If we’re going to increase, we’re going to go from totally burned out, totally unenjoyable, stuck. No creativity, no empathy, which scares the hell out of me in any profession, because the empathy, the giving, caring about what you’re doing is like, 90% of the battle in literally, like, almost every profession, it’s most scary when you’re talking about medicine or that and maybe, like, nuclear engineering.

Mike Rucker [00:28:05]:
I know, from looking at the sales data, it’s the other one that I’m closer to. I haven’t done any original research in this area, but sales people that feel empathy and a connection to who, to who they’re trying to help tend to do better, too. So I think there’s a strong argument that if you looked at it across all vocations. Right. So sorry to interject, but you’re spot on.

Wes Moss [00:28:24]:
Yeah, totally. But can we think about it as a. And am I going to. Can I increase my focus on making sure I’m having some fun? Should I do it 10% more or an hour more a week or 2 hours more a week to start out with? What is kind of just a realistic prescription around that for you? And maybe talk about the play model that we just touched on, those quadrants.

Mike Rucker [00:28:52]:
So I think for every person, it’s going to be different depending on what their life circumstances. The play model is a way to just look at each thing that you’re doing and then potentially see if there are opportunities to change your circumstance. And so play stands for pleasing, living, agonizing, and yielding and pleasing are just the things that we enjoy doing. Right. Hanging out with our partner. You know, if you have a pet, hanging out with your pet, maybe it is certain things at work. So, you know, the day to day joys that oftentimes we undervalue. But we know that if we’re mindful when we’re in those moments, we can remember, like, oh, yeah, you know, I like what I’m doing.

Mike Rucker [00:29:31]:
I like the people that I’m with. I like the environment that I’m in. So they’re generally accessible to most people, but when we kind of just mind wander through them, we don’t get the benefit. Right. Living is kind of a bigger concept. We don’t have a ton of time to dig into it, but it’s just that reminder that doing kind of big things at least once in a while, if you’re looking back at your life and you’re like, I haven’t done anything that’s sort of challenging or for my own betterment or for spiritual growth or whatever it is, maybe I want to figure out why and at least ask better questions. The other two are important in context, especially so pleasing.

Wes Moss [00:30:07]:
Think I love walking Cody with my wife, our dog. That’s pleasing. Correct. Learning how to snowboard at age 55 would be like, that’s maybe living.

Mike Rucker [00:30:21]:
Exactly.

Wes Moss [00:30:21]:
All right, so those are two of the quadrants.

Mike Rucker [00:30:24]:
And I guess to expound on it more. So essentially, when you look at it, how much effort does it take? Because pleasing things don’t take a ton of effort. So in theory, if we want to do them all the time, we wouldn’t be exhausted. At the end of the day, living generally does either take mental energy or physical energy. So in that sense, even if we’re really enjoying those things are not something that we can realistically do all the time. Right?

Wes Moss [00:30:50]:
Yeah.

Mike Rucker [00:30:50]:
So agonizing and yielding are the same, but they’re things on the negative side of valence, the things that we just don’t enjoy. So. And again, you know, I unpack this in the book. Certainly we all have agonizing things we need to do. That’s just part of life. But the reason that that quadrant is important is a lot of us don’t look at those things critically or ways that we could potentially change our circumstance. Right. There tend to be three things that make something enjoyable.

Mike Rucker [00:31:15]:
The people that we’re doing it with, the environment that we’re in, or the activity itself. And so when you identify these things that, you know, maybe you just always hated them, but you hadn’t thought about how you could change your circumstance. Like, you know, I love what I do, but I just don’t like the people I do it with. Like, so maybe it is time to, you know, jump ship and find, you know, a place where I actually enjoy the, you know, because of moral compass or whatever it is. Right. You know, in the pandemic, this is a really easy, accessible example. But the environment, right?

Mallory Boggs [00:31:49]:
Yeah.

Mike Rucker [00:31:49]:
We were so sick of our home offices that folks found that just being in a coffee shop around vibrant people was enough to, like, break out of that malaise. But it could be one of the examples. I, you know, in my day job, I work, we put wellness centers, you know, essentially health clubs and corporate campuses and hospitals. But if folks hate being in the four walls of a gym, let go, walk out in nature. I’m surprised how many people just that simple invitation where they’re like, you know what, I’m never going to be healthy because I hate, you know, being on the treadmill. Like, yeah, you’re allowed to hike. Like, oh, my gosh, I love nature, you know, and it’s the same drive. And so just that simple, you know.

Wes Moss [00:32:29]:
You can change the environment. Just. Just change the environment. Yeah.

Mike Rucker [00:32:32]:
And then the activity is, are you going about it? Is there any way to go about it differently where you could potentially change your circumstance? And then if you come from a place of privilege, can you buy back your time?

Mallory Boggs [00:32:43]:
Right.

Mike Rucker [00:32:44]:
Like, sometimes I share that and get accused because it is, you know, if you have the financial means, great. It’s not something that’s accessible to everyone.

Wes Moss [00:32:51]:
Wait, are you only talking about rich people?

Mike Rucker [00:32:53]:
Correct.

Wes Moss [00:32:55]:
But you disguised it as financial privilege, just like pro social.

Mike Rucker [00:32:59]:
Yeah, exactly.

Wes Moss [00:33:01]:
So talk about that. Go ahead. Go ahead.

Mike Rucker [00:33:03]:
Well, I think especially for entrepreneurs, right. A lot of folks when like, you know, podcasters is a great example. I don’t know how many podcasters who are using this as a vehicle to essentially bring light to their business, and yet they’re still editing their episodes. And you ask them why? Because they’re like, I hate it. And you could find someone, if your billable rate’s dollar 200 an hour, you could find someone for dollar 60 and then not have to do that at night. So you could be with your kids, you know, and so that’s just one example. But, you know, oftentimes when you’ve habituated that, you’re like, oh, this is just something I have to do.

Wes Moss [00:33:46]:
Yeah.

Mike Rucker [00:33:46]:
Do you really have to do it? You know, you have to make that social media meme and you don’t even know how to use Photoshop. You know, I get why you want to do it at the beginning, right? Because you kind of wanted to learn and, you know, it’s your brand, but is it something you should be doing two years later? You, you hate graphic design and so those types of choices, right? Like it’s something you really don’t like doing. Oftentimes it, you know, maybe it’s not even necessarily outsourcing it, it’s trading it for somebody, you know, somebody, I do love doing this, you know, using that same example. You know, it’s actually, Fred loves making the means and Joe actually loves editing and they never talk to each other. So, you know, figuring that out. So again, in summary, you know where you’re doing it, what and how you’re doing it and then who you’re doing it with. And oftentimes just changing one of those can really bring an agonizing activity up above that threshold of valence.

Wes Moss [00:34:42]:
Yeah, I think of that as remembering specialization of labor to some extent. And that is a huge, it’s a huge thing in our lives and our jobs too. It’s, when is it time to look at the 20 jobs you’re doing? Are you better to do ten and figure a way to outsource the other ten? But it’s not economically possible all the time. But I think more so than people maybe give it credit for.

Mike Rucker [00:35:06]:
Yeah. And where I would say it grows roots.

Mallory Boggs [00:35:09]:
Right.

Mike Rucker [00:35:10]:
So oftentimes that isn’t the heavy lift. The heavy lift is, well, this is just always what I do on Thursdays. And that’s the weirdest one. And the one that we really have a hard time believing is true. But we just know we’re habituated animals. We get into those rhythms of life, and then because we don’t encode that information, time kind of just passes us by. And it’s a little bit comfortable, but it’s not enjoyable. And so there’s a whole other argument there.

Mike Rucker [00:35:38]:
But I do want to get into yielding because that’s the most.

Wes Moss [00:35:40]:
Yeah, let’s talk about yielding.

Mike Rucker [00:35:41]:
So yielding are things that are really easy to do but don’t bring us joy. So it’s really just ways to pass time. And so the one that’s talked about most often is social media use. And so certainly not villainizing these platforms. It’s a great way to stay in touch with folks that I moved from San Francisco to North Carolina. So it’s a great way for me to stay connected. But a lot of us use it passively just to displace boredom. We might have a couple hours on Saturday and instead of making a good choice of something like playing pickleball with a friend, we’ll just sit there and mindlessly scroll memes.

Mike Rucker [00:36:19]:
Its gotten so bad, right, that Google and Apple have gotten good about providing health meters in your phone. And a lot of folks will look at those and go, oh my gosh, I cant believe I did spend 8 hours on Instagram. So those things can be really illuminating. And if you see that kind of data, thats a perfect place to start, right? Im not saying completely get off of them because as we know, you deprive somebody or something, then all of a sudden, you know, that’s not as interesting. But saying, okay, let’s make your Instagram time 2 hours a week and then let’s figure out 6 hours a week of doing something that really fills you up. You know that when I ask you what you did, you can tell me in rich detail with a smile on your face. Instead of, oh yeah, I saw a couple funny memes.

Wes Moss [00:37:05]:
What is the practicality of finding that? By the way, I’ve had retirees ask me over the years, one of my terms for this is core pursuits. These are the things that I guess I would put these in the fun category, but these are the, I think of it, as you live for these things, you don’t just do them.

Mike Rucker [00:37:25]:
Yeah, absolutely.

Wes Moss [00:37:26]:
How do you jog the creativity to come up with something new.

Mike Rucker [00:37:31]:
So, I mean, it’s as simple as just sitting down and brainstorming, right? And so I think you get it all out. I call it a fun file. There are going to be some kind of bumps in the road there, because especially later in life, you’re going to mourn a few things. I know I’ve done this exercise a few times, and Boston Marathon comes up because every seven years, it’s on my birthday, and it was something I always want to do. I see it on the list. I mourn the fact I had the hip replacement. That’s just not something that’s going to happen. I cross it off the list, but then I continue to think about, what are the things that do light me up.

Mike Rucker [00:38:08]:
Um, what are the things that I, you know, have wanted to do? Who are the friends that I want to connect to? Who are the friends that are crushing life? That could be great examples. If I just had a conversation like, what are you doing? You know, is there an opportunity to tag along? And so, hey, give me an example.

Wes Moss [00:38:25]:
Tell me about a friend that’s crushing life. I want to know about a friend that’s crushing life. Like, what do you think that is? And two, I want to know something that. That your favorite, let’s call it new edition. That came out of a fun brainstorm.

Mike Rucker [00:38:39]:
Sure. Well, my best run is certainly crushing life. I would put him in the category of being affluent in both categories, but I think he is just so deliberate about creating moments with his family, especially because he was raised in a military family, where because of deployments and things of that nature, they became difficult. So really creating these moments, being deliberate about being creative and then letting the things that don’t work go. So he’s a really good model for me in that regard, because I think sometimes, too, when you’re first getting started, if there’s a string of bad luck, which will happen to the best of us, oh, this isn’t working. But if you can kind of laugh at those situations, like, wow, this is a horrible mistake.

Mallory Boggs [00:39:30]:
Right?

Mike Rucker [00:39:30]:
Like, going back to Vegas in your fifties for a three day weekend. Right? Like, that was amazing when you were 30. Right? And it sounds like a great idea in your fifties. And it’s just, I think, for the majority of us, like, a reminder that things have changed, but being able to laugh at that instead of saying, I’m not fun anymore. So he’s been a great model for me personally. One of the things that’s kind of like being contrarian to that is I had picked up the guitar. But I also djed in college, and I had this mindset that, you know what? In my fifties, I’m too old to DJ. But I was just in New York for work and saw an old high school friend.

Mike Rucker [00:40:11]:
His name’s Josh Davis, but he goes by DJ Shadow. 52 year old guy, still crushing a big crowd, you know, in a club in New York. And so I picked the turntables back up, and I’m playing around a little bit with them, and it’s really fun for the kids. Cause they’re like, what? What are you doing? What?

Wes Moss [00:40:31]:
Do you have a d? Wait, have you figured out a dj name yet?

Mike Rucker [00:40:34]:
Well, my old DJ name was DJ Ruckus, because my last name’s Rucker.

Wes Moss [00:40:37]:
Oh, that’s so cool.

Mike Rucker [00:40:38]:
I don’t know if it fits, though, but. So we’ll see what happens. I think a new one needs to develop. We’ll let my kids decide.

Wes Moss [00:40:45]:
I don’t know. It may be tough to beat that name, though, because even DJ Rucker, you’re just. Your name is cool. But ruckus, I mean, I don’t. That’s pretty awesome. There’s this intentionality that you prescribe. We’ve got to understand that it’s okay to prescribe yourself fun. And if you’re at work, we can change our environment or change the people that we’re necessarily around all the time.

Wes Moss [00:41:13]:
And these are the. I guess to some extent, these are prescriptive ways that we can start to. I think of this fund meter as like, dialing it up from. I’m only having fun 10% of the time, but I want you to have fun 25 or 30 or 35% of the time. I want people to add more to their lives.

Mike Rucker [00:41:31]:
And I wouldn’t even quantify it. I would say the frame that I like is really when we needed to reframe the conversation about sleep in the nineties. Remember all these a type, folks? Gary Vaynerchuks of the world, who I like, by the way. Cause he’s completely changed his tone because he knows better. Remember we were championing sleep deprivation, right? You know these eye bankers that, you know, a lot of us, 4 hours a night. Yeah. And now you. No one would prescribe that because we know what happens, right? These folks burn out by their late twenties.

Mike Rucker [00:42:03]:
And so sleep hygiene has become a pillar of health. And I think you’re going to begin to see that with leisure, right? If you really need, you know, kind of this range. Again, I fall back on the research of doctor Cassie Holmes. But she’s found two to 5 hours is kind of the sweet spot. I think for most people, two is still kind of a stretch goal, you know? So I again suggest just trying one to 3 hours a week after 5 hours with her and her, I believe she did this work with doctor Jordan Ekinata Duke. After 5 hours, you start to question, like, maybe I’m having a little too much fun, right? Like, you know, anyone that wants to live a meaningful and purposeful life will start to question whether or not you’ll start to erode that hedonic flexibility principle effect. So that’s sort of the range.

Wes Moss [00:42:53]:
But you’re talking about two to 5 hours per day. Week or. Per day, yeah, per day.

Mike Rucker [00:42:58]:
But some of that could be at work, right? I mean, it’s really the mental frame you want to think here is, am I in control of my time, right? So if I’m in this meeting, is it something that I did deliberately or if I’m working on this project, is this something that I have complete control over and I enjoy? Right. It’s not something that’s been delegated to me again this time of time. Effluence. The one other thing I want to make sure we cover before we end is that if all of this still kind of seems foreign to you, remember to be the best version of yourself, to kind of reclaim that empathy. Like, if you want to serve your children, this is especially true. I find, for whatever reason, there seems to be this gender bias to, you know, guilt when you’re actually engaging in self care. A whole corpus of empirical research suggests that by doing this, you are actually that person you want to be. Because now when you show up to care for others, you are engaged with them, you’re mindful, you want to be there.

Mike Rucker [00:43:59]:
It comes from this I get to do attitude rather than I have to do. And you will feel better about the things that you’re doing. So it, by the way, is it.

Wes Moss [00:44:08]:
Men or women that have higher levels of guilt?

Mike Rucker [00:44:10]:
Women, they tend to feel like they have to serve the family, where for whatever reason, and again, these are broad generalizations, but men find ways to play golf with their buddies or, you know, they seem to. They still, both sides are complex, but for whatever reason, and, you know, men have their own problems, we tend to not ask for help less. So, yeah, there’s complexities on both sides, but men will take time off the table for themselves. Right, where sometimes you see women live the whole 168 hours of their week for other people. And we know that’s a recipe for.

Wes Moss [00:44:48]:
This Oscar that’s pretty indicative of our family with. I have four kids, Lynn will spend all 168 only thinking about them all the time. And it’s hard for her to tear herself away to go have. I mean, not even maybe two to 5 hours a week is a stretch, not a day.

Mike Rucker [00:45:10]:
Right. And that’s, again, where I start. I think that’s interesting research, but for most people, I think, realistically, let’s start with one to 3 hours a week.

Wes Moss [00:45:21]:
Mike, you talk about the importance of journaling and keeping track of this to some extent. Talk about that for a second.

Mike Rucker [00:45:29]:
Yeah. So I call it reminiscing, and it’s essentially a way to expand the value of the fun that we have. So we’re reminded that we have opportunities to create these joyful moments in our life, and then it allows us to encode that information. And so one of the physiological benefits of living a life that’s a broader tapestry than a lot of us are living is that when we have a corpus of whether they’re fun or just interesting memories to look back on, our brain perceives that time as a longer timeline. It’s just a matter of math. What we know is the folks that have really habituated their lives and aren’t really doing anything interesting, unfortunately aren’t encoding information. So they’re not creating neuroplasticity, but also they’re not looking back at their lives with, you know, much concern. And so this work, a lot of people are familiar with the work of Bronnie ware.

Mike Rucker [00:46:25]:
She wasn’t necessarily a scientist, but she was a palliative care nurse that asked, you know, people in their later years of life what they regretted. And if you look at the five main things, three of them are cemented and not enjoying the things that they did. And so, you know, in that context, even if it’s just, again, you know, one or two things a week, so that you have this body of things to remember, that becomes important. And journaling is a great way also to cement that, because maybe you have a crappy two or three weeks where you didn’t have control of your time at all. You can at least look back at that journal, and we know reminiscing things that you did enjoy can be as powerful as enjoying them in the moment.

Wes Moss [00:47:09]:
How often do you do it?

Mike Rucker [00:47:12]:
I’ll go through stretches again. You know, I unpack this in the book. It’s not a good habit to prescribe this habitually, so you really should do it as whatever feels good for you. Some people ritual of every night is a great way to kind of data dump. What I would suggest is it’s not too introspective, but really cataloging what happened. If you feel like you have to unpack some things, great. I’ll do it a couple of times a week, then I’ll go a couple weeks without doing it, then I’ll do it every night for ten days or whatever. And sometimes it’s not just about fun.

Mike Rucker [00:47:49]:
So for me, sometimes I want to unpack what went wrong as well. But it’s sporadic, but I would say on average, ten to twelve entries per month.

Wes Moss [00:48:02]:
You don’t have to go back to revisit it, necessarily. It’s the doing of it that encodes it.

Mike Rucker [00:48:07]:
Yeah. And so for anyone like me that doesn’t want to, that feels like that’s homework. Right. Because that it needs to be fun.

Mallory Boggs [00:48:14]:
Right.

Mike Rucker [00:48:15]:
And so, yeah. Sonia Lubermersky, she’s at the University of Riverside, is the one that did this, because it was another facet of this toxic positivity. Right. There was gratitude has been well studied.

Mallory Boggs [00:48:27]:
Right.

Mike Rucker [00:48:27]:
And it is an amazing practice. But then life coaches, quote unquote, tapped into it and started telling people they had to find three things a day to be grateful for. Well, you know what happens. I think I already shared, I lost a loved one that wasn’t a time for that type of prescription. And so when there’s this dissonance of what you’re told you need to do to be, quote unquote happy and how you really feel inside again, we’re going back to that moral injury. So do it however you want. And I guess a word of warning. What I found is initially my journal had the days in it, so I would feel bad because you’d see this big, empty space back to a composite book, and I’ll write the day in so I don’t have to think about the blank pages where I didn’t feel it in.

Mike Rucker [00:49:14]:
Again, agency and autonomy at its best, right.

Wes Moss [00:49:17]:
It is the true measure of freedom and happiness and fun. It’s just so much about autonomy, so gratefulness again, you don’t like this idea of you have to be grateful for three things every day and write it down. So do you do this more organically as you’re journaling about and you’re kind of encoding?

Mike Rucker [00:49:37]:
Yes.

Wes Moss [00:49:37]:
That’s your fun memories, the days that.

Mike Rucker [00:49:39]:
I feel like something is worthy of writing it down. But what I’ve done through kind of cultivating this growth mindset is knowing that it’s there. And if that thing sits for a week, then I can ask better questions of like, hey, why haven’t I picked that up? Like, why haven’t I been able to create something that belongs in that journal? And then I’ll start to make better choices. And that happens all the time, so it’s a nice kind of artifact totem as well, is that, hey, I haven’t picked this up. I need to create something in my life so that’s worthy of writing something in that journal.

Wes Moss [00:50:14]:
So as we wrap up, I’d love for you to leave our audience with maybe one action step or one way we can improve, let’s say, relationships with either our friends or our kids. Maybe it’s our spouse. What’s a practical action step to infuse a little bit more fun with one of those groups?

Mike Rucker [00:50:34]:
Yeah, absolutely. So one, again, try to find one or 3 hours where you can kind of clear space. So again, don’t try and make this out of clear space, and then figure out what is your jam? What do you want to do? I’ll fall back.

Wes Moss [00:50:48]:
That could be from the yielding category. Right, so you find some of that time.

Mike Rucker [00:50:51]:
Yeah, exactly. Then use some tools from my background in behavioral science. Whether you want to do a full blown fun file or whether you just want to sit for 30 minutes and go, you know, what? What is something that I haven’t done in the last twelve months that I want to do? You know, is it going to the comedy club if you’re, you know, you like jazz? Is it Jazzenhe? Is it a solo activity because you’re introverted? Is it just curling up with a good book at a pool and not having anyone bother you, whatever that is. Create that list, but make it things that could be reasonably done in the next couple of weeks and then pre commit to it. Get it on the calendar. If it costs a little bit of money, prepay for it if it’s inviting a friend. So there’s that social contract and, you know, you don’t want to let your friend down. Invite your friend along, even if you’re introverted.

Mike Rucker [00:51:46]:
I tend to push people in that direction because if we get others involved, we generally don’t want to flake on them. And even introverts still want to be around people, just not a lot of people. And again, the benefits of the geeky word again. But pro social behavior can’t be understated. And then just make it happen. And then check in with yourself the next day. How do you feel? How are you showing up to the things that you needed to do that you thought might be affected because you were quote unquote selfish with your time the day before. And I promise you, you’ll understand what the benefits are.

Mike Rucker [00:52:22]:
The same way we got people to understand the benefits of good sleep hygiene when they stopped answering emails from 09:00 p.m. to 11:00 p.m. realizing it didn’t take away from productivity and how much better they felt the next day.

Wes Moss [00:52:37]:
Have you gone to a flip phone yet? Have you done that yet? I keep talking about it. I think at some point I may do that.

Mike Rucker [00:52:44]:
But I’ll tell you, I talked about this in the book as a one off. And it is something that I’ve gotten feedback from multiple people that they’re like, thanks so much. And I didn’t even really prescribe it. It was more of an anecdote. And that is on Amazon, you can get a locking cookie jar. So it’s meant to stop people from eating cookies that’s on a timer rather than a lock. People love this intervention. They get home from work, they put it in the cookie timer, and then the cookie timer opens up at 08:00 a.m.

Mike Rucker [00:53:14]:
so they don’t have access to their phone. And like, so of course, if they need it, they could smash the cookie jar. But, you know, not many of us are going to do that.

Wes Moss [00:53:24]:
I also wanted to, before we go, I wanted to kind of give our folks a preview in the fun habit about Cindy and kind of her quick transition in her journey in retirement. Can you share just a little bit about that as a preview in the book?

Mike Rucker [00:53:38]:
Yeah. So Cindy is a friend of mine’s mother, and her and her husband went into retirement. And I think what’s beautiful about her story was when they first embarked on that one, they realized they wanted to change their environment because their environment hadn’t made them happy. And that’s why I first wanted to interview her. But the beauty of it is they realized that they had habituated their lives so much that they didn’t know each other anymore, and so they got to fall in love all over again. And so obviously that comes with some potential risk. And so it wasn’t all beautiful, but the ability to someone that you shared this life with to be able to rediscover them and also share in like, okay, well, I know when we were both kind of courting each other, we thought we knew what each other thought was fun. That must have fundamentally changed.

Mike Rucker [00:54:28]:
And this was true. Her husband’s name is Mike for both of them. And so they got to reintegrate what they really wanted to do later in life, gave themselves space to do the things that they wanted to do separately, but then came together for these moments of co created fun in ways that were just amazing because they were deliberate about it.

Wes Moss [00:54:48]:
Well, this has been fun and I love that you give us permission to focus in on it. I think that the thought around I could absolutely see, and this took sleep to your point, probably two decades to everybody to finally agree that sleep, the no sleep thing is b’s, the full blown amount of sleep you need. It’s not something that we should die on a sword for the whole, oh, I don’t need, I can do the four hour sleep thing, the Vanderchuk deal. But to think that the prescription around having these being intentional around, we have to put ourselves in a place to be able to have this experience of more fun and enjoyment and autonomy in our lives is just as important. And I see that it’ll probably take another ten or 15 years, but it’s a good candidate to get that stamp of approval.

Mike Rucker [00:55:44]:
Yeah. And I think fortunately the empirical research similar to sleep is now making, you know, a pretty strong case you’re seeing in the EU, companies begin to protect their employees in this regard. One of the examples I bring up is France has made it illegal for companies to keep their email servers on past 05:00 p.m. on a Friday so that people illegally.

Wes Moss [00:56:08]:
Wait, that’s a government rule, correct? I don’t know if I knew that. 05:00 p.m. on a Friday. I’m so guilty of that specific. I don’t even look at the clock anymore. Well, all right. Doctor Mike Rucker, thank you, man. Thanks for stopping by the retire sooner podcast and I think we learned an awful lot and I love the direction that this helps our would be retirees or current retirees focus in on something that I want people to be able to give their self permission to do.

Mike Rucker [00:56:43]:
Thank you. Thanks for having me.

Mallory Boggs [00:56:46]:
Hey y’all. This is Mallory with the retire sooner team. Please be sure to rate and subscribe to this podcast and share it with a friend. If you have any questions, you can find us@westmoss.com dot. That’s wesmoss.com. you can also follow us on Instagram and YouTube. You’ll find us under the handle Retire Sooner podcast. And now for our show’s disclosure.

Mallory Boggs [00:57:06]:
This information is provided to you as a resource for informational purposes only and is not to be viewed as investment advice or recommendations. Investing involves risk, including the possible loss of principal. There is no guaranteed offer that investment return, yield, or performance will be achieved. Stock prices fluctuate, sometimes rapidly and dramatically, due to factors affecting individual companies, particular industries or sectors, or general market conditions for stocks paying dividends. Dividends are not guaranteed and can increase, decrease, or be eliminated without notice. Fixed income securities involve interest rate, credit inflation and reinvestment risks and possible loss of principle. As interest rates rise, the value of fixed income securities falls. Past performance is not indicative of future results.

Mallory Boggs [00:57:46]:
When considering any investment vehicle, this information is being presented without consideration of the investment objectives, risk tolerance, or financial circumstances of any specific investor and might not be suitable for all investors. Investment decisions should not be based solely on information contained here. This information is not intended to and should not a primary basis for any investment decision that you may make. Always consult your own legal tax or investment advisor before making any investment tax, estate or financial planning considerations or decisions. The information contained here is strictly an opinion and it is not known whether the strategies will be successful. The views and opinions expressed are for educational purposes only as of the date of production and may change without notice at any time based on numerous factors such as market and other conditions.

Wes Moss [00:01:39]:
And we’re going to compare this to before. The pandemic has surged dramatically despite all the speed bumps and booby traps we’ve been through in the last three to four years. So if you think back to the millionaire next door, that was a book written in the mid 1990s. I remember I was an intern in the financial industry, and it was a new book at the time. It had been out for a year or two and started to get some real traction. And then to this day, I think the book is just as popular as it was 25 years ago. Those methods of gaining financial independence and creating wealth in the United States, I think today are maybe more popular than ever. I still wonder because I was still in college at the time, did the term millionaire next door really exist? Or was it a part of the us psyche before Thomas Stanley and Bill Danko wrote that book and did all that research? I’m not sure, but it’s certainly in the vernacular today, the millionaire next door, of course, is someone that we think about who doesn’t necessarily seem rich, doesn’t necessarily act rich, but if you look@their.net worth, their bank account, their real estate holdings, their overall net worth, and it’s way into the seven figures.

Wes Moss [00:03:03]:
That’s a millionaire next door. I think those lessons have become more and more well known. I think there’s better financial education in the United States today than there ever has been. There are multiple money podcasts. There’s stacking Benjamin’s how to money deeper pockets, retire sooner podcasts and the advice that only the really rich had back in the eighties with their financial advisor or stockbroker back decades ago today is fully available. In fact, I would argue that the advice today that’s easy to access, whether it’s online or through podcasts, is probably a lot more objective today than it was 30 or 40 years ago. Meaning that today you’ve got financial educational resources that are writers. They’re not in it for an asset management fee.

Wes Moss [00:03:59]:
They’re not in it for a commission. Used to be a time in the 1980s where to buy 100 shares of a stock, it could cost $100 a dollar per share. Then it went to share, then twenty cents a share. Then trades became a flat price. 1990, 912 bucks, $5. And then a few years ago, big companies like Schwab led the way and just said, hey, no more trading costs. So the walls of financial advice, the impediments, have largely gone away. The costs has come down dramatically.

Wes Moss [00:04:38]:
The access has been fully democratized. And maybe that’s why we’re seeing so many new millionaires here in the United States. Whatever the late, great Thomas Stanley did, and the great still living with us, Bill Danko, who was, he’s been here on the retired senior podcast. Their work rings true to this day, maybe more than ever. According to this brand new study from the Federal Reserve, there are more millionaires today in the United States by overall net worth than ever before. 16 million. 16 million american families. That’s a lot.

Wes Moss [00:05:16]:
That’s 12% of all us families, up from only 9.8 million at the end of 2019. So we’re talking about just a three year period here. We’re looking at numbers that ended in 2019, that we had 20. 202-021-2022, that three year period, which there was peak pandemic years. Take it one step further. There are 8 million families in the United States. So part of that 16 million with $2 million or more. In fact, the average or mean net worth in America right now is just over a million dollars.

Wes Moss [00:05:49]:
Whoa, wait a minute. The average family in America is worth a million bucks. Now, that’s a little bit misleading, because remember, when we’re looking at average and we’re looking at median, they’re very, very different ways to find those two numbers. Median is when you look at the entire population, think of it in a giant lineup, and you take the middle person so that the billionaire has just as much weight on picking the center of that line as somebody with zero money. That’s the median number. And when it comes to looking at big data sets, particularly around wealth, net worth, income, it’s probably much more representative to think about numbers from a median perspective. Choose the middle. The typical, if you will, when you think about the average in the United States, particularly with something like wealth, because we have 1000 or so multi multi billionaires in the United States, maybe it’s not a thousand.

Wes Moss [00:06:49]:
There used to be the Forbes 400, I remember, and I haven’t looked at the Forbes 400 list for a while. But for the most part, you’ve got to be a billionaire to be on that list. And I think there’s. That could be an even bigger list if it were just billionaires. Now, when we’re looking at an average, that number can be greatly skewed by the several hundred billionaires here in the United States. I remember looking at the Forbes 400 list many years ago, and the bottom few folks were just under a billion. So you essentially had to be a billionaire to be a top Forbes 400. Today, there’s almost 800 billionaire families in the United States.

Wes Moss [00:07:31]:
So the average wealth in the United States is skewed by that group. So even though the average net worth in America right now is just over a million dollars, up 42% from 2019, when it was just shy of 750,000. If you look at it from a median perspective, that numbers 193,000. That seems to make more sense when you’re looking at the entire us population. But again, that number is up 37% since 2019. The median american family, $193,000 in net worth. Now, there’s also some real trends in who’s becoming a millionaire. And part of this is a study around emerging folks.

Wes Moss [00:08:17]:
Who is the next crop, or the emerging group of people that will hit that millionaire number sooner than we all might think if we look at what happened during that period of time. So think those three years, 20, 2021, 22, the big jump. This is a huge jump in net worth and the number of people that have hit this million mark. It makes sense because we saw values for two things go up dramatically over that period of time. Look at the case Shiller home price index. That’s the aggregate measure of home values in the United States. An enormous part of what makes up the net worth here in our country. Keith Sheller Home price index went from 212 to almost 95 during that period of time.

Wes Moss [00:09:12]:
That’s up almost 40% during that window. And the S and P 500 was up almost 20% from the end of 2019 through 2022. So it’s home values and really almost any other asset that’s been able to keep up with inflation. Now, what else do these emerging millionaires look like? Number one, they have good incomes, not amazingly high incomes. So they have good incomes, not millions a year. They earn between $150,000 a year to $250,000 a year. What’s interesting is this emerging group. They’re the top 20% of earners.

Wes Moss [00:09:53]:
Not the top ten, not the top five, not the top one. This is the top 20% group. And they’ve seen bigger gains than even the top 10% of earners in the US, up 69% in overall wealth, adjusted for inflation, to a median of almost $750,000. So you could call these mini millionaires, like the Wall Street Journal is saying, or you can call this group emerging millionaires. In fact, if you really think about this, this emerging group only needs to go up in net worth by about 33 and a half percent. Then they’re at the million mark. From a stock market perspective, who knows? If the market averages 10% a year, that’s about three, four years from now. If that net worth is really tied up in real estate, it might be five or ten years as real estate, after the big surge we’ve had, is more likely to go back to that baseline, two to 4% a year that we’ve seen historically for housing.

Wes Moss [00:11:00]:
But either way, it’s not too far down the line. But what got this group there, yes, they have good earnings, but there’s a couple other really key items we’ve already touched on. A few they’re investors. Not only are they savers, which of course the millionaire next door authors would certainly agree with, but they’re investors as well. They didn’t just save their way there. They have saved and likely invested and gotten the tailwind of the eight to 10% in markets and three to 5% in real estate. It’s really tough to save your way to being a millionaire. It’s a little easier.

Wes Moss [00:11:38]:
Still not easy to invest your way to being a millionaire. So they own inflation and hedging assets like real estate and us stocks, even if it’s just in the 401K. But here’s another really interesting part. They’re college educated. They’re an educated group. If you look at the overall share of families who are millionaires by age group one, we see the percentage rise as you get older. Of course, that makes sense because it takes time. For example, only 1% of families under age 35 are millionaires.

Wes Moss [00:12:16]:
But then that rises with age. By ages 55 to 64, 21% of families are millionaires. That’s for the overall population of the United States. Now, if you look at just families that are headed by college graduates, now look into that same category, 55 to 64 years old, that number jumps to 45%. So 21% for the general population, 45% if you’re college educated. I look at that as you’re two times more likely, two x more likely to end up in the millionaire camp if you have a college education. For the last decade, and maybe rightly so, because college debt and student loan debt has ballooned to over a trillion dollars in the United States, the argument is college worth it? It’s so expensive, really gets ping ponged around. Is it worth it? Is it not worth it? Go to a two year school, don’t go to a four year school.

Wes Moss [00:13:23]:
If I were arguing the point, is it worth it or not to go to college, is it worth the money? I think this settles it. Looks like college is worth it after all. Just looking at the numbers here in the United States, I don’t even think it’s an argument. So not only have we seen assets go up, but we’ve also seen debt for these families go down. Over 90% of these families. This is the emerging millionaire group report, owning stocks. Over 90%, either either directly or through some sort of retirement account at work, 87% of this group owns a home, 87%. So not only have they seen home values go up, they’ve been in the tailwind of extraordinarily low interest rates.

Wes Moss [00:14:12]:
Now, not 2023, when rates went through the roof, but 20. 202-021-2022 people were able to refinance at historically low interest rates. What did that do? It cut debt payments as a share of their income, which was 19%. So debt payments relative to income at 19% in 2007 to less than 13% in 2022. So not only did assets go up, overall debt became more manageable. Now, here’s an example. What if, I’m going to do two examples here. One with a million and one with $500,000? What if someone was in retirement and I’m going to cherry pick a really bad year to retire? For markets, that was 1990.

Wes Moss [00:15:05]:
919, 99 was a great year. And then what followed that? And that’s if you look at history, it’s really what happened the preceding years when you were no longer working, no longer saving, trying to live off your investments. 2000 was a rough time to really start. So we looked at a 25 year stretch going back, starting to right after 1990. And looking at this group, that’s not necessarily saving, they’re just living off their money. What did that look like? Here’s a couple of scenarios. A million dollars invested in three separate ways. One, a balanced portfolio, 60% s and p 540% bonds, agribond index number.

Wes Moss [00:15:47]:
Two, a portfolio that’s only investing into one year treasury. So every year you get the prevailing treasury interest rate, one year. And then three, a portfolio fully invested in something just paying a fixed 4.5%. We picked that rate because that’s around the prevailing cd rate back in 1999. Now, you would have had to lock in a 25 year cd, but let’s just say that was the case in all three scenarios. These are people that had stopped working. They’re pulling from their assets. We’re going to use the 4% rule.

Wes Moss [00:16:21]:
We’re going to say year one, 4% is $40,000. And then every year, inflation goes up, we ratchet up to 40. So in all three scenarios, those retirees that were right just at the million dollar mark in liquid assets, they all withdrew the same amount, $1.3 million, $40,000 per year over the last 25 years, ratcheted up for inflation. Mathematically works out to 1.3 million. What’s each retiree left with? Well, choosing the fixed rate, let’s say we could just magically have waived a one, gotten four and a half percent per year. Million dollars took out 1.3. It’s actually $1.34 million. There’s still money left at the end 25 years later, just shy of three quarters of a million.

Wes Moss [00:17:13]:
So you start with a million, took out 1.3, and you would have ended at $744,000. Not. Not bad. If you did the one year treasury strategy, which is probably closer or more realistic to reinvesting in a one year cd each year, million bucks to start, you take out 1.34. But in this scenario, whether it’s one year treasuries or if it were to have been one year cds, it’s similar. Pretty much ran out of money. $62,000 started at a million, pulled out 1.34 million, down to close to zero. But the good old fashioned balanced portfolio, both stocks and bonds, that’s gotten a really bad rap over the last few years because bonds have had a terrible run over the last two and a half, three years.

Wes Moss [00:18:08]:
The retiree that had a balanced portfolio still took out 1.34 million, using the 4% rule, adjusting for inflation. At the end of the 25 years still left with over $1.2 million. Again. Takes investing to become a millionaire. Takes investing to stay a millionaire as well. If you’ve ever done a Jane Fonda workout or if you remember as a kid rocky running the steps, and if Michael Keaton is still Mister mom to you, then guess what? It’s officially time to do some retirement planning. It’s Wes Moss from money matters. Weren’t those the good old days? Well, with a little bit of retirement planning, there are plenty of good days ahead.

Wes Moss [00:19:00]:
Schedule an appointment with our team today@yourwealth.com. dot that’s your, yourwealth.com dot. So there are the numbers. 16 million households have already crossed the million mark. Half of those are 8 million or 2 million. We’ve got this big burgeoning group of the many millionaires. We call them emerging millionaires. The question is, what are those habits from the millionaire next door that get us there? And we’ll bring in producer Mallory as we talk these through.

Mallory Boggs [00:19:32]:
Oh, yay. Thank you for bringing me in.

Wes Moss [00:19:34]:
I really meant to bring you in at the very beginning of this. And then I just, when it was.

Mallory Boggs [00:19:38]:
So good, though, I just, I love whenever you find a topic that you’re really passionate about and you can just really feel that as you talk through it. It’s so interesting and engaging the way.

Wes Moss [00:19:47]:
That you do that. Oh, interesting. Thank you so much. It is so interesting.

Mallory Boggs [00:19:50]:
I guess I’m biased.

Wes Moss [00:19:51]:
All right, so we’ve got million xdor. We’ve all read it. If you haven’t read the book, it’s one of the best. It’s one of the all time greats. I was at one of my kids schools the other day and it was on the bookshelf.

Mallory Boggs [00:20:05]:
I was just looking it up on Amazon. It’s still definitely in the top selling books on there. You know what’s funny, though? I actually found the millionaire next door on my parents shelf when I was in college. But it was the millionaire woman next door, so they had kind of a different take on it. And I was taking a personal finance class at the time, so I flipped through there. That was really my first introduction.

Wes Moss [00:20:25]:
Were you taking personal finance? You’re saying this is college or high school?

Mallory Boggs [00:20:28]:
College.

Wes Moss [00:20:28]:
Oh, you took personal finance?

Mallory Boggs [00:20:30]:
Yeah. Actually at UGA they offer a class through the School of economics, it’s. Which is a little bit more like it’s home. Eck, actually. But it was great. It was so helpful. I learned then to, like, you know, they had all kinds of great rules of thumb. They explained, like, the difference between, like, leasing versus buying a car outright and kind of the benefits and like, pros and cons there.

Wes Moss [00:20:47]:
Do they have the 4% rule?

Mallory Boggs [00:20:49]:
You know, I think they might have talked through that. That’d been.

Wes Moss [00:20:51]:
I don’t think so.

Mallory Boggs [00:20:52]:
I wonder now, honestly, though, I’ve learned so much about finance, I can’t even keep it straight.

Wes Moss [00:20:57]:
Well, now, now look, you’re the producer of the retire Sooner podcast, but really you were in marketing that you were in real estate, commercial real estate marketing. And then you, many, many years ago, you joined our team, and now you’ve become the producer of the retire Sooner podcast. So you’re in finance now, whether you like it or not. And let’s talk through some of these. There are dozens of really great lessons in the book, so I wanted to distill them down in just five. Maybe we can remember a shorter list. And I think this really does it. And this entire group lives below or well below their earnings.

Wes Moss [00:21:32]:
Two, millionaire next door families focus their time and energy on wealth building activities. They’re always thinking about growing their wealth in some way. Three, they’re seeking independence and financial freedom. They’re not seeking status. That was a really big theme from Stanley and Danko. Four, they raise independent children, which is interesting. And number five, they’re really almost always just plain hard workers who are also thinking about achieving financial independence and really have that mindset. And I’ll start there.

Wes Moss [00:22:11]:
How many people do you know that are wealthy either from inheritance lottery or hitting it kind of big in almost like a Facebook story where they were at a startup and they have tons of money because they happen to be at XYZ Snapchat.

Mallory Boggs [00:22:31]:
I don’t know if I can name a single one, quite frankly.

Wes Moss [00:22:33]:
Not a single one.

Mallory Boggs [00:22:34]:
I don’t know if I’ve really got a lot of people like that in my rolodex. What about you? How many do you know? How many lives?

Wes Moss [00:22:41]:
Okay, so over all these years, working with thousands of families over the years, and not working directly with every single one, but knowing a lot of the families that are, that our firm works with, I’ve talked to thousands of families around this. I would say only, I’d say I could count them on one hand, it’s a small number one lot, one lottery.

Mallory Boggs [00:23:06]:
Reeves and I always like to say whenever the lottery gets to about a billion, we’re like, it’s time to invest in our financial future. We gotta buy lottery tickets.

Wes Moss [00:23:13]:
I can’t argue with that number two inheritance. I don’t know if I very rarely have I ever seen it be an unexpected, all of a sudden, oh, my long lost uncle aunt from many states away left me 2 million, 3 million, $5 million. I’ve seen that. But again, only two or three times that I can really remember now, generational wealth and families that is a little bit more common, where the family is already wealthy, and it’s not necessarily that they inherited, but the whole family already is wealthy, from grandfather to father to next generation. So that’s a little more common. But again, not hundreds. This is a few dozen people over the years. And then again, I could count on one hand, and again, it’s not never folks that were with a small company that either went public and their stock went through the roof, they owned one or half a percent of something and it became several million dollars.

Wes Moss [00:24:20]:
Or their company that was private got bought by a bigger private or public company and that became a windfall. Somebody getting ten, $20 million, that really in a short period of time. So it absolutely happens. I’d say the generational wealth is more common, but the sudden wealth from nothing to several million, it definitely happens, but I’d say it’s less than 1% of the time, even in an industry that is typically working with people that have been focusing on and accumulating wealth. So it’s not never, and it’s not never. And I love those stories. Someone who is the fifth person at a company that got bought by a bigger software company, I love those where they look up three, five, seven, even seven years later and all of a sudden have $10 million. Those are awesome stories.

Wes Moss [00:25:13]:
And those people, 95% of those people didn’t just get lucky. They’re also exceptional because they happen to be in that spot. And they were part of the reason that company grew. But again, it’s rare. The majority of these folks are in it for the long haul and they’re hard workers and they were almost always able to grind away one self employment. A significant proportion of the millionaire surveyed in the book Millionaire next door were self employed business owners or they were in careers that didnt have a lot of cap on the upside. So think of a revenue sharing job or a sales oriented job, some of the riskier jobs that can end up really having high incomes, that maybe get you there a little faster.

Mallory Boggs [00:25:59]:
It sounds like you know, you really gotta have some cojones to be able to the millionaire next year.

Wes Moss [00:26:03]:
These are not, these are not the safe, stable jobs that you’re gonna get tenured. However, speaking of a lot of folks that end up in this category that are teachers and accountants and engineers and managers. But they hit that mark by living by, number one, living well below their earnings or living well below their means.

Mallory Boggs [00:26:27]:
Not keeping up with the Joneses or the Kardashians.

Wes Moss [00:26:30]:
Lord or the Kardashians. That’s tough to keep up with.

Mallory Boggs [00:26:33]:
Yeah, that one. It’s entertaining to watch. And it’s exhausting to think about the expenses.

Wes Moss [00:26:38]:
Yeah. I always see the Maybach cars and those really ultra limo things. And I think I can see how if you’ve got a really high income, that works, but it’s the, you know, the private jets that those people fly around on. Oh, you’re talking about $20 to $50,000 per leg.

Mallory Boggs [00:26:59]:
Oh, my gosh. It’s so wild to actually, like, wrap.

Wes Moss [00:27:02]:
Your head around from Philly to Miami.

Mallory Boggs [00:27:04]:
And you could get such great, like, first class seats. I don’t. And now. And actually, they even have, like, that private terminal through the airport here in Atlanta. Have you heard about that?

Wes Moss [00:27:14]:
That’s interesting. And for those who don’t live in Atlanta, we’re the busiest airport on planet Earth. That the statistics say it. And a Monday morning says it. When you can’t even walk to your gate because the plane train, which is their name for the bus, is backed up by 1 minute. The entire causeway is filled with people. And you almost have to, like, you almost have to weave your way through. It is a mess.

Wes Moss [00:27:40]:
So they put in place something that a friend of mine told me about, asked me if I was a member of. I read about it, something like five grand to join the, this really nice lounge at the Atlanta airport. And there’s a few others. I think there’s one in Heathrow, there’s one in LA. But I don’t understand why you would pay that much if you live in Atlanta, because you’re not in a layover in Atlanta. You’re going to your flight and you’re getting on your flight. So I don’t understand why anybody from Atlanta would ever pay that much money to have a better experience, not to have to weed. I get not wanting to weave through all the people.

Wes Moss [00:28:20]:
There’s a price. I don’t know what it is for me, but I don’t know why you would do it in your home airport.

Mallory Boggs [00:28:26]:
So I will say, I mean, I actually, I take it back. It was.

Wes Moss [00:28:29]:
And by the way, and by the way, we’re totally off track here, but I love this topic.

Mallory Boggs [00:28:32]:
I mean, it’s just kind of crazy, right? I mean, like, you know, you gotta. If you’re gonna talk about millionaires, I feel like you gotta talk about like some, some crazy lifestyle things too. Even though our people aren’t normally taking part of these. But. So it wasn’t an article that I read. It was actually a TikTok, which was even better. Cause I was able to see.

Wes Moss [00:28:46]:
Gotta listen to TikTok.

Mallory Boggs [00:28:47]:
I love the Tiktoks, Mandy. So interesting, because apparently the whole thing is that they have the security there so you don’t go through that main part of the security. Right. Like that would be an argument to have it with your hometown airport.

Wes Moss [00:28:59]:
Way quicker security.

Mallory Boggs [00:29:00]:
Way quicker security.

Wes Moss [00:29:02]:
And that’s a good point.

Mallory Boggs [00:29:03]:
And then you hang out at the lounge and then it drives you to the plane.

Wes Moss [00:29:06]:
What drives you?

Mallory Boggs [00:29:07]:
Like a car.

Wes Moss [00:29:08]:
What? And then apparently when you just walk up the steps. Yeah.

Mallory Boggs [00:29:11]:
And you walk up the steps and then an Uber will come and pick you up, like whenever you’re going to leave. I’m not gonna lie.

Wes Moss [00:29:17]:
You know, this sounds like your typical.

Mallory Boggs [00:29:20]:
I don’t know if I’d spend the money on it product.

Wes Moss [00:29:22]:
That sounds good and is good. But so many people like the sky club, get a dollar 500 Amex card and you can be part of the sky club, which is great. Well, it is great. But guess what? Everybody else thinks it’s great and everybody else buys the card. And now the sky club, there’s a line out the door and you’ve got 1400 people crammed into space sneezing on your food buffet. So the sky club went from great to largely terrible. And Delta’s had to change their entire business model around it and people are up and even about that. So we’ll see.

Wes Moss [00:30:01]:
Because how many, how many individual cars can be driving around on the tarmac taking people to their planes.

Mallory Boggs [00:30:06]:
Yeah, but I get if they’re saving money because otherwise they’d be flying private, I guess it’s still that millionaire next door mindset, right. If you’ve got the option of like, pay $5,000 a month or not a month. God, I hope it’s not a month.

Wes Moss [00:30:18]:
5000 a year.

Mallory Boggs [00:30:19]:
Okay. 5000 a year for this private access to a public plane. Right.

Wes Moss [00:30:23]:
Okay. And it’s a middle of the road.

Mallory Boggs [00:30:25]:
Yeah. Versus like. Yeah, like paying $20,000 a leg for a private plane. I guess, you know, you’re still technically saving.

Wes Moss [00:30:32]:
I know the jury’s still out on that, and even that’s gone through the roof with inflation. So not only is this group really hard work, that’s number five. Number one is they live well below their earnings. In your case, you’re saying join the private group to take public planes. Maybe that works. So, look, being frugal, of course, can be part of the process. It usually is part of the process. I have seen many folks scrimp and underspend their way to wealth.

Mallory Boggs [00:31:00]:
I think there’s some probably much better examples than a private plane versus versus not versus not.

Wes Moss [00:31:06]:
Correct. This is a group that takes coach. It does, yes. Business class, probably. But it doesn’t mean that they also don’t spend a little for first class, because, yes, I’ve seen people scrimp and save and only fly coach no matter how much money they have. The great Byron Wein, the late, great Byron Wein, who passed away in 2023, worked into his nineties, obviously very wealthy guy, one of the most famous guys on Wall street. One of his life lessons was to never fly private.

Mallory Boggs [00:31:39]:
Oh, wow. I know.

Wes Moss [00:31:40]:
I don’t know what his net worth was, but it. And this is a guy who, according to Market.com, comma, worth an estimated $100 million. So there’s a nuance here. Not all millionaire families live on beans and rice and library books. There are plenty of wealthy families that spend a fair amount, but they simply have the earnings, either wage or residual investment income to support it, to support the spending, no matter what. And this is, I would say, indisputable and a no brainer. Spending, of course, needs to be moderate relative to earnings. All right, number two, Mallory, these families focus their time and energy on wealth building activities.

Wes Moss [00:32:26]:
What does that mean to you?

Mallory Boggs [00:32:28]:
To me, I feel like that means that they are actually. I’m gonna have to think about it. It’s kind of like they are. It sounds like they’re focused on actually purchasing a house and they’re focused on setting up a. They’re not necessarily just chasing the latest, greatest fun new thing that they can spend their money on.

Wes Moss [00:32:56]:
Yeah, I think it’s partially right. The thought here is that they put a lot of stock in advice, and they’re very happy to spend time with their CPA and talk about taxes.

Mallory Boggs [00:33:08]:
Okay.

Wes Moss [00:33:08]:
They’re very happy to sit down with an advisor or multiple advisors and understand what they should be investing in. Although I’m going to. I’m going to put my money to work. Where are the best places to do this, what investment should I make? What building should I look into? They’re thinking about that in terms of where can my money be working for me? Which is really different from where can my money be the safest? So yes, we can think where can I get the best cd rate? That’s kind of the height of safety. And yes, even those savers want the best rate they can have, but it is different from having this ownership type mindset on where is my money going to be really working and compounding for me. So they’re very happy to spend time on that financial thought. So investment planning equals wealth accumulation essentially. That’s the way I look at it.

Mallory Boggs [00:34:01]:
That makes sense. They surround themselves with smart people and they keep learning.

Wes Moss [00:34:07]:
Yeah. And they’re very happy to. They’re happy to pay for advice in someone else’s area of expertise. So here’s the next one they’re seeking independence and freedom versus status. And again, most of our listeners probably thinking, I don’t think, I don’t think of money as status, but just be honest with yourself.

Mallory Boggs [00:34:27]:
This comes back to the private plane.

Wes Moss [00:34:28]:
Is there a little bit in any sort of purchase? I mean, we all have a little bit of that in us, right? Do you feel as though a house represents what, where you should be living? We could all, not all of us, but we could probably live in less expensive houses. We could drive less expensive cars. Speaking of cars, this is back in the original work from Stanley and Danko. About 81% of millionaires, about 81% of this millionaire next door population purchase their vehicles. Only about 20% lease. Now, it doesn’t mean leasing is necessarily a bad deal. In fact, there’s been a wild swing throughout Covid and used car prices. And used car and new car prices.

Wes Moss [00:35:21]:
And people who leased ended up in a great spot because they got more for their car than they maybe thought they were going to get. So there are always exceptions to these rules. But I think it has to do with more of this ownership mentality. I want to own something. I don’t want to rent it or own a car versus rent a car. I want to own a house rather than rent a house. I want to own stocks rather than I want to own part of a company rather than take my money and rent some interest in the bank.

Mallory Boggs [00:35:53]:
I wonder how Thomas Stanley would feel about the rental market now. When I think about things like Uber and Lyft and the little bird scooters and Netflix, even you rent everything.

Wes Moss [00:36:06]:
Now I’ll tell you exactly how the classic millionaire store would think about that you’re crazy to use Uber. Anything, $10, $15 delivery fee when you could just get in your car and go to the cheesesteak shop and get a cheesesteak. You’re crazy to pay $30 to go across town in an Uber. You’re crazy to rent one of those ridiculous bird scooters, which, by the way, people leave on my sidewalk. And they’re the worst invention in the history of mankind.

Mallory Boggs [00:36:43]:
You haven’t ridden one, clearly.

Wes Moss [00:36:45]:
And I’ve ridden them, and I just think they’re the worst.

Mallory Boggs [00:36:48]:
Oh, they’re so fun.

Wes Moss [00:36:49]:
Oh, they’re the worst. And you probably, you and your hippie friends probably leave your bird scooters and your lime scooters laying on my sidewalk.

Mallory Boggs [00:36:59]:
I actually make a point of it. We like to stop by there.

Wes Moss [00:37:02]:
I want them to ban them from all existence. But again, the cost of that would say, just buy your own scooter and charge it in your garage and own your car and pick up your food. Go to the grocery store, don’t have instacart deliver. I think that’s what Stanley and Danko would probably say. Again. Again, we don’t all follow all the rules, and I’m guilty of using way too much uber, particularly eats.

Mallory Boggs [00:37:32]:
That’s fair. Everything in moderation. Including moderation.

Wes Moss [00:37:36]:
Including moderation. All right. And the last one, which was number four out of the five. We started with five independent kids. They raise independent children. Wait, why is this so important? Why do you think it’s so important? You’re an independent child.

Mallory Boggs [00:37:49]:
Thank you. I. You know, you reach a certain age.

Wes Moss [00:37:52]:
Of early retirees or newer retirees.

Mallory Boggs [00:37:55]:
There we go.

Wes Moss [00:37:56]:
And they’re in really good shape. And it’s no surprise to me that you’re totally independent. You have been since you’ve been probably 22.

Mallory Boggs [00:38:02]:
Yeah. Yeah. All of that’s accurate.

Wes Moss [00:38:04]:
That’s the whole reason your parents are millionaire next doors.

Mallory Boggs [00:38:07]:
Oh, you know, it’s so nice. I’m so glad we finally got to the source of this. Yes, you’re right. You’re welcome, mom and dad. You’re welcome. I love that my sister gave him a grandbaby last week, but I’m the one who made the millionaire next doors, so I’m pretty sure I win.

Wes Moss [00:38:23]:
This was a great part of the research. They foster independent kids, and the family puts a huge emphasis on education. We just talked about educational statistics and how the percentage of folks educated or the percentage of millionaire families through the roof. But all of that includes a wealth building mindset. It includes saving, investing, entrepreneurship, we also know this is from some of our research of the retire sooner team, is that a Trobs raise their adult children to be economically self sufficient. A Trobs happy, happiest retirees on the block support their children less than dollar 500 a month, on average. Their adult children, the unhappy group, set more than $700 per month. There’s a big difference between those two.

Mallory Boggs [00:39:10]:
Zachary. I remember being shocked by that statistic that I figured that happy retirees would not support their children or like, it would be a very small dollar amount. So the $500 a month for a happy retiree couple I thought was pretty high. But do you remember, too, and then, like the most unhappy retirees, remember that dollar amount? That’s also shocking.

Wes Moss [00:39:32]:
Well, it was 700 way plus.

Mallory Boggs [00:39:34]:
Well, it was. If you were, you were four times more likely to be an unhappy retiree if you were supporting your kids by $2,000 a month.

Wes Moss [00:39:41]:
That’s right. That was the more extreme case. As the numbers climbed, your retirement happiness declined precipitously. And it’s because you can’t afford everything. We can’t afford our own retirements and our kids into their thirties. It’s just too taxing for most Americans. The other thing, when it comes to career development, this is a study I found from the Journal of Vocational Behavior that financial support from parents can lead. Of course.

Wes Moss [00:40:07]:
Well, this makes sense. Can lead to delay in career development for their young adults, may reduce the urgency to get financially independent through career progression. And I’ve seen that. I’ve seen financial support that can work in both ways. And this one is also nuanced. I’ve seen financial support really support people and launch adult children. I’ve seen adult children be overly dependent and stay dependent on financial gifts, financial support from their parents. And ultimately, I think it’s the millionaire next to their own independence that often translates to their children, and then they take that into adulthood.

Wes Moss [00:40:47]:
There’s a great sense of independence. So hard work and independence, I think you put those two together with this, just not an obsession, but a real mindfulness around, I want my money working for me. I want to be an investor. You put that together, throwing sprinkle in some education and at least a dash of frugality, and voila. That’s the recipe right there. So it’s probably more of a recipe, and it’s a long one. This is a cake that takes a long time to bake. It’s not a magic potion.

Wes Moss [00:41:21]:
This isn’t a dash of wart frog that all of a sudden scratches off a $2 million lottery ticket. It’s not a potion, it’s a recipe. It’s a lifelong journey. And that’s the reality for almost any investor. It takes investing to get to be one of these millionaire families. And then, maybe just as interestingly, taking a look at some of the numbers we went over in today’s episode, it takes investing to stay a millionaire family as well. So here on the retire Sooner podcast, I hope that we’re helping you get on and stay on. So I hope here on the retire Sooner podcast, we’re doing our part to help you, encourage you, educate you, motivate you to stay on that same path to being a millionaire next door, maybe retiring just a little bit sooner.

Mallory Boggs [00:42:18]:
Hey y’all. This is Mallory with the retire sooner team. Please be sure to rate and subscribe to this podcast and share it with a friend. If you have any questions, you can find us@wesmoss.com dot. That’s wesmoss.com dot. You can also follow us on Instagram and YouTube. You’ll find us under the handle Retire Sooner podcast. And now for our show’s disclosure.

Mallory Boggs [00:42:39]:
This information is provided to you as a resource for informational purposes only and is not to be viewed as investment advice or recommendations. Investing involves risk, including the possible loss of principal. There is no guaranteed offer that investment return, yield, or performance will be achieved. Stock prices fluctuate, sometimes rapidly and dramatically, due to factors affecting individual companies, particular industries or sectors, or general market conditions for stocks paying dividends. Dividends are not guaranteed and can increase, decrease, or be eliminated without notice. Fixed income securities involve interest rate, credit inflation and reinvestment risks and possible loss of principal. As interest rates rise, the value of fixed income securities falls. Past performance is not indicative of future results.

Mallory Boggs [00:43:19]:
When considering any investment vehicle. This information is being presented without consideration of the investment objectives, risk tolerance, or financial circumstances of any specific investor and might not be suitable for all investors. Investment decisions should not be based solely on information contained here. This information is not intended to and should not form a primary basis for any investment decision that you may make. Always consult your own legal, tax or investment advisor before making any investment tax, estate or financial planning considerations or decisions. The information contained here is strictly an opinion and it is not known whether the strategies will be successful. The views and opinions expressed are for educational purposes only as of the date of production and may change without notice at any time. Based on numerous factors such as market and other conditions.

Wes Moss [00:00:41]:
I guess I’ll tell a quick story. I don’t know if I’ve told this on the podcast before, but I was always pretty physically active. I played sports through high school a little bit. I stayed active through college, and I have four kids or boys, so we’re pretty active family, and I have tried to stay pretty active. And in one, I’ve done a couple different boot camps over the years and different gyms and. And about. I guess this is definitely, it was pre Covid, I want to say. Between 2018, I did a gym workout.

Wes Moss [00:01:13]:
I was with the group, and I was probably a month or two in getting in pretty good shape, kind of re engaging, and I ended up getting. We did a floor workout in a really seedy gym, which wasn’t necessarily a bad thing. It was just an old basement gym. And I’m gonna say it’s not even the gym’s fault, but I had a cut in my elbow. And after this hour and a half workout, the next day, my elbow was swollen, and I thought that I had just bruised it. Long story short, it turned out to be a staph infection in my elbow. I ended up in the hospital. I had to be iv antibiotics.

Wes Moss [00:01:49]:
It was like a nightmare. It took. It really was. It was rough. So I kind of after, and I was fine. But it was a couple days of a little bit nervousness, redness, spreading up my arm. My doctor, an earlier joke, like, oh, might have to saw your arm off. And then, and then two or three days later, I’m in the hospital.

Wes Moss [00:02:10]:
I was like, that’s actually not funny. It was not a funny comment because I really had to. Anyway, so what it did is it knocked me out of working out. I almost had, like, a little bit of PTSD for a couple of years now. I was somewhat active coaching and doing some other things, but it took me a while, Aaron, to kind of get back to working out, and I don’t know what the motivation was. I finally about six months ago, made a promise to myself that I would do it, and I finally found somebody. And now I’ve been. I’ve now been back active again several days a week, and it really has been phenomenal.

Wes Moss [00:02:50]:
I do always wear long sleeve shirts now. Cause I’m always worried I’m gonna get some infection somewhere, but. So I’ve got some residual nervousness about it. But it’s been awesome to get back and moving. And I’m not quite at this 50 year mark, but I’m pretty darn close. And I know that it just gets harder and harder and harder. One of the really important things that we know, besides diet is movement and being healthy. And I wanted to kind of get back to your theme around your podcast.

Wes Moss [00:03:22]:
You’re interviewing people that are professionals that are helping, really, people that are, what, 50 plus? Get moving. How often is it people getting back, moving after not, or they just. What’s the state of play? If you’re 50 in America right now, are you more likely that you’ve been a couch potato and you’re not moving? Is it a small percentage of people. How many people kind of get back to it? What do you think the state of play is?

Erin Eleuterio [00:03:49]:
Yeah. So, really, the majority of Americans, just across the board, are not getting the physical activity that they. That’s required, that’s put out by American College of Sports Medicine with the cardiovascular and strength training. So most people aren’t. However, what I find encouraging is they’ve done a study, and on the over 65 population, it is growing. So I think from it was like 1990 to about 2019, it was like 4% of people over 65 were meeting the physical activity requirements, and now it’s like 4%. 4%, yeah, 4%. And now it’s getting up to 14%, which, of course, is definitely the minority.

Erin Eleuterio [00:04:30]:
But I choose to look at it, that’s it’s growing like this massive progress. It’s really considerate progress. And people over 50 are getting more and more concerned about health span, and a big part of that is physical activity and being able to retain our physical abilities as we get older. So there’s an increased focus on health span, even though most people aren’t meeting the physical activity guidelines. So I think that that’s encouraging. And a lot of those people that are active, they are inspiring those of us that maybe don’t have that level of activity, but they’re showing us what’s possible in those later stages of life. And those are a lot of the people that I feature on my podcast.

Wes Moss [00:05:16]:
Yeah. So you feature professionals that are helping folks that are 50 plus. Are they 50 plus? What’s the. Tell us about your podcast just a little bit.

Erin Eleuterio [00:05:27]:
The vast majority of my podcast guests are over 50 and they’ve taken on a second act career endorsing physical activity. So it doesn’t necessarily mean that they’re a personal trainer. Although I did interview world’s oldest active personal trainer. He’s 81 and he’s a retired financial planner. So they’re not necessarily a personal trainer, which we think of as a fitness professional, but they are encouraging physical activity. And I’ve had people that are in conducting clubs for outdoor enthusiasts. So there’s a Pikes peak over the hill gang in my local area, and they do all, it’s a social club for outdoor sports. So they’re skiing together, they’re hiking together, golf, pickleball, and it’s wildly popular.

Erin Eleuterio [00:06:13]:
So I try to feature.

Wes Moss [00:06:15]:
You’re in Colorado Springs.

Erin Eleuterio [00:06:17]:
Yeah.

Wes Moss [00:06:18]:
So you’re in kind of the mecca of Colorado is such an amazing outdoor place. The weather’s better than people think. It’s really kind of, it’s really conducive to being active.

Erin Eleuterio [00:06:31]:
Definitely.

Wes Moss [00:06:31]:
And I think, though, the other thing that through some of your work that I’ve read and listened to is that it’s not necessarily about going and finding a trainer per se, because you don’t have to go to a gym and start moving necessarily and lifting and doing squats. It’s really just about figuring out a way. And I guess this is the thought around blue zones where kind of to active places where we’re just automatically moving. Maybe talk about just how do we engage or incorporate being active without actually having to go to go to the gym?

Erin Eleuterio [00:07:06]:
Yeah, you don’t have to go to a gym, but first and foremost, it has to be fun. I mean, you know, we’re adults. It’s adults all day long, and it should be something that’s enjoyable. And so I think that’s first and foremost, like find something that’s a fun for you so it doesn’t feel like work and a slog. And some people it is the gym, but some people it’s not. And I also think about what are the physical abilities that you want to have decades from now. So you’re moving today is going to determine how you move tomorrow. So I think about movement that way.

Erin Eleuterio [00:07:39]:
And movement is much more palpable thing to think about than exercise, which makes it think like working hard and going to the gym and the grind and all of that. But any movement that you’re doing today, you’re making deposits into what I call your physiological 401k. So what you do today, this is a retirement podcast, determines what you get to do tomorrow and the day after that. So think about movement in that way. And for example, I sit on the floor a lot because I want my 90 year old self to be sitting on the floor. So I’m going to make those investments now and do things now so that my future self can continue to have this ability. So I think if we think about movement in that way and how we can make investments in our movement patterns and what we want to be able to do, we all know people older than us and we can see areas that they struggle and things that they can’t do. And what do you want for yourself? What do you need to be doing now so that you can do it in the future?

Wes Moss [00:08:37]:
So it’s. Maybe we have this culture, and maybe this is my bias, but I, I guess to some extent, we have this planet fitness culture where we see gyms all over the place and we think about working out as we’ve got to go to some sort of place and some sort of gym. But I think that what you’re saying here is to kind of just stop thinking about it that way. Obviously, that’s fine, great. If you do that, you go sign up. But the reality here is just activity and movement. Now, that’s not easy in every urbanization environment, though. Not everybody lives in Colorado Springs.

Wes Moss [00:09:14]:
So I guess my question is that what if your neighborhood isn’t necessarily, what do we give us some actionable ideas around getting moving if you’re not necessarily. If you don’t live on a. Have a wonderful trail in your backyard.

Erin Eleuterio [00:09:31]:
Yeah. Find ways that you can stack movement into your everyday life so it doesn’t have to be a 2030 minutes workout. That could mean if you have a community mailbox, you don’t drive to the community mailbox. You walk to the community mailbox. Anytime you sit down, you’re going to do three to five sit to stands before you sit down. If you’re in your kitchen and you’re waiting for the water to boil, maybe you’re doing countertop push ups. These are all ways that we can just get movement throughout our whole day. If you’re going to the grocery store, rather than pushing the carta to your car, you’re going to carry your groceries to the car.

Erin Eleuterio [00:10:08]:
Um, and finding ways that we can walk a little bit more. Maybe it’s just, you know, parking further out so you walk into the store. These are all little ways that we can get movement into our life and build a more movement rich lifestyle. That doesn’t necessarily mean exercise, going to the gym, which is all great, um, but finding ways that you can move more throughout your day and not always defaulting to machines, escalators, elevators, chairs, that get us up out of to standing if you don’t have to find ways that you can use your body to do those things. And I think that’s a much more accessible way to enter a more movement rich lifestyle.

Wes Moss [00:10:47]:
Well, I was going to ask you, and I think it’s now the wrong question. I was going to say, well, how do you find one of these health professionals? I mean, you obviously interview often different people that are helping folks that are 50 plus and this is their second at career. So that is one. Right. So it’s one thing to find those professionals and I want to ask, how do you do that? And then I guess the other one. And the reason I’m saying that’s maybe the wrong question. It’s not necessarily about finding fitness professionals and it’s really finding groups that propagate or help facilitate just movement in general to kind of like your pike’s peak group. So let’s start with how do you, how do you find someone that can kind of kickstart you?

Erin Eleuterio [00:11:31]:
Yeah. So if you’re looking for a fitness professional that specializes with older adults, you know, you can certainly go to gyms and interview the trainers and see if they have training in working with older adults. Functional aging institute is a wonderful resource. It’s where I got my training from and they offer a lot of continuing education certifications for fitness professionals that specifically want to work with over 50 population. And they have a website with a directory of people that have been trained through them. So finding those people that have specifically trained with this demographic can be really important just to make sure that you are working with somebody that’s aware of things that tend to happen as we get older and that they can equip you with building the capacities that you want so you have the physical abilities throughout the rest of your life. But I think interviewing, making sure you’re getting the right professional and also just somebody that you resonate with. I mean, just this is somebody that you’re working with.

Erin Eleuterio [00:12:24]:
I think we do this for any kind of service that we have, whether it be a financial planner, real estate agent, make sure there’s a connection there with that person that not only do they have the credentials and the qualifications, but you feel comfortable with them and you trust them.

Wes Moss [00:12:37]:
You know, I remember, I think it was a spin class or some sort of class that I did at one point, and the instructor would yell out, even Flo Joe had a coach and that it’s almost anybody. Even if you’re an elite athlete, it does help to have someone there, whether it’s teaching improving motivation. But what does it cost to do this? And I would contend that the cost is minimal relative to the gain here. What do people usually pay if you’re engaging someone like this? And how often do you need somebody to coach you?

Erin Eleuterio [00:13:13]:
For personal training in particular, you’re going to be paying at a minimum, $50 an hour for a trained professional, and it could easily go closer to $100 an hour, uh, for that one on one training. A lot of trainers are doing small group training sessions, so it can be a way to get more social connection and work with people. So you have that camaraderie aspect, and then you’re usually going to pay a little bit less. And it could be, you know, closer to 40, $50 per session for a group training session. Um, and those can be ways that, you know, you’re making an investment in your health. So this is more of, I think of fitness and exercise as true health care. We’re caring for somebody’s health, so it’s preventative and it’s an investment in that preventative care rather than a lot of times healthcare. What we call healthcare now is actually sick care, and we’re just managing sickness and illness.

Erin Eleuterio [00:14:03]:
This is a way to maintain your physical abilities going forward. So that’s how I would think about what you’re paying for your trainer. It’s an investment in your health. Yeah.

Wes Moss [00:14:12]:
And when you think about, it’s funny to think of it that 50 is old, but it’s so 50 is not old. Let’s just say that for our listeners, is 50 is not old. But when you’re starting to, when you’re doing workouts in your fifties and then your sixties and your seventies end up, the exercises are, can, I think it does make sense that they’re more functional. And as I’ve learned more and more about this population and the kind of exercises that may make some sense, they’re around being able to, if you recover from a fall or not get hurt, if you were to fall or how to sit down and get up and use those muscles that are, and I guess what you would call this in a very functional way, this is functional exercise. Can you kind of explain that to our listeners?

Erin Eleuterio [00:15:01]:
Yeah, if you’re going to be exercising at a gym or even on your own, you want to find exercises that are mimicking day to day life. So that’s squats. Like, we squat, we sit down all day long, you know, whether it’s at the dining room, table, bathroom, whatever, we’re doing squats all day long. So that’s a really important exercise. Deadlifts, we’re carrying load from the floor. We’re bringing it up towards us, or we’re, we’re lifting load over our head. So, like shoulder pressing, um, pushing and pulling with our upper body. These are all things that we do day to day life.

Erin Eleuterio [00:15:31]:
And so if we mimic those with our workouts, it makes us better equipped for those day to day activities that if we need to, you know, pick up, maybe it’s a small pet or a grandchild from the floor, that is essentially a deadlift. So if we can practice those movements.

Wes Moss [00:15:46]:
Thinking about picking up a grandchild? Yeah.

Erin Eleuterio [00:15:48]:
Yeah. And if you’re holding the grandchild and sitting down with them, that’s like a goblet squat. So where you’re having the weight or holding a weight in front of you and you’re sitting down and up, these are things that we are doing day to day. Um, groceries. You know, you, you have your bag of flour and you’re putting it up on the top shelf. Like, that is a shoulder press type of action. So I always say we lift weights all day long. We just don’t always, they’re just not shaped like dumbbells.

Erin Eleuterio [00:16:13]:
They’re shaped as babies and groceries and small pets. So think about how you’re moving day to day with load. You know, a gallon of milk, that’s load. And you’re pulling it off the shelf. See if you can do things that mimic those activities so that they just become easier for you as you get older. And it’s not something that is a struggle.

Wes Moss [00:16:40]:
If you’ve ever done a Jane Fonda workout or if you remember as a kid, Rocky running the steps. And if Michael Keaton is still mister mom to you, then guess what? It’s officially time to do some retirement planning. It’s Wes Moss. Weren’t those the good old days? Well, with a little bit of retirement planning, there are plenty of good days ahead. Schedule an appointment with our team today@yourwealth.com. dot that’s your, yourwealth.com. i’d love to hear some stories around, or I’d love, love for you to share some stories that you’ve either had because you do group training for seniors and also some of your guests. I mean, there was a story that I recall of someone who was kind of out of shape, but this is a, I think you were interviewing a male trainer who their client was out of shape.

Wes Moss [00:17:35]:
They got them back into shape. They unfortunately passed away, I think was the story. However, that latter part of their life, being more in shape was much better than prior. And I think that that’s kind of, I’d love to hear that kind of motivation around getting back in shape.

Erin Eleuterio [00:17:54]:
I’ve had a couple of guests. One memorable story was from a fellow trainer and she was training a gentleman that was 95, and he was getting back into doing physical activities. And he said, you know, I really want to get back to revving my chainsaw again. He was, you know, chainsawing with his, with wood and he’s like, I want to get back to that. So, you know, they used bands and they were pulling and pulling and she was able to get him back to revving a chainsaw, which is not the first thing you think of when you think of like, I’m going to train a 95 year old. What should I have him do? You think of, like squats. But it was training him to using his chainsaw again because that was a meaningful activity for him. So that was a very memorable story.

Erin Eleuterio [00:18:36]:
And of course, so did he get.

Wes Moss [00:18:37]:
Back to using the chainsaw?

Erin Eleuterio [00:18:39]:
He got back to using the chainsaw, yeah, after training with her. So that was one of my more memorable stories. And of course, since then he’s passed. And that was years ago that she had trained him, but that was one of her most memorable stories. And then I had interviewed a guy who had retired. He was working in the college system. He retired and he was in his sixties. He decided, you know what? I really need to make, I have more time on my hands.

Erin Eleuterio [00:19:01]:
I’m going to make investment in myself and in my health. And he decided to start weightlifting and start going to the gym in his sixties. So he walked into a 24 hours.

Wes Moss [00:19:10]:
So hold on. He had never really done it before.

Erin Eleuterio [00:19:12]:
No, it was kind of touch and go. He would sometimes be a little more active in his life and other times, but he had never really done it. But relatively inactive, never had a dedicated exercise program. So in his sixties, he decided to walk into a gym and hire a personal trainer. And he started his weightlifting program in his sixties and he’s now in his seventies. He’s got a popular instagram account and he’s lifting heavy weights in his seventies and he is showing that it’s not too, you know, you can’t be too old. It’s not too late. You can start in your sixties, you can start in your seventies.

Erin Eleuterio [00:19:46]:
Build capacity, of course. But he’s just an inspiration, and I call him an instagram encourager to show people what’s possible later in life. And he’s been a very inspirational story. He’s had setbacks, but he stays the course. And so I think having examples like that for people is so important because so many times people discount their physical abilities simply based on age alone. And, and a lot of times, there’s a great quote that’s, we are limited more by our beliefs than by age itself. And so when we show people that are doing the things that people didn’t think was possible, it makes people rethink of what’s possible at that stage of life.

Wes Moss [00:20:27]:
Social media encouragers, not necessarily influencers.

Erin Eleuterio [00:20:31]:
Yes. That’s how I think about it.

Wes Moss [00:20:33]:
What about the thought around, it’s not that uncommon that, first of all, people do get hurt working out. So there’s, and I’m not, let’s disregard my weird story about being, you know, getting some sort of weird infection, but people do get hurt working out. And I know that doctors, sometimes the medical community will, will maybe poo poo. What you’re able to do in the gym to some extent. Do you see that as part of the issue here is that, oh, well, once you reach a certain age, you shouldn’t be doing. You shouldn’t be doing that?

Erin Eleuterio [00:21:09]:
Yes. There’s a lot of ageism. Our culture really fosters this idea of, of what older people are capable of. And we see this a lot in our environment, and it influences older adults abilities and fitness levels when we are shown images of only older people lifting small, tiny dumbbells. And the healthcare system can be the same way. Yeah, like, I mean, you hear stories where people.

Wes Moss [00:21:35]:
The one pound weights.

Erin Eleuterio [00:21:37]:
Yeah, exactly. And I always think, like, what if that was a 20 year old holding one pound weights? Like, that would be weird. But when it’s somebody with a gray hair, you’re like, oh, yeah, we see that all the time. You know, pictures of old people lifting small weights. But it’s, but it’s also, what does that communicate? It communicates that old people are weak. And that’s what it communicates, even though it doesn’t explicitly say that. And we see this, we can see this in healthcare. We see it all over.

Erin Eleuterio [00:22:01]:
And you hear stories of people where their doctors are discounting them. Well, you’re 70 now. You just have aches and pains or people are just handed a cane because they’re 90. Well, you know, maybe. Maybe that’s not necessarily the case for that person. And so I think we need to get to this place where we’re challenging that. And a lot of my podcast guests, I feel like, are really challenging the images of what we see with this older population. When we have rock climbers and we have low flying trapeze for people over 60, it’s challenging what we.

Wes Moss [00:22:35]:
Hold on. Let’s go back to that. So you’ve got people in their sixties rock climbing, and I don’t even. What is low? What is it? Low.

Erin Eleuterio [00:22:44]:
Low flying trapeze? Yeah. So it’s not as high, you know, where you’re like, you think about the circus and they’re like sky high. It’s not that high, but it’s high enough to get their feet off. I forget the exact level, but it’s high enough to get their feet off the floor and they can swing. It’s a form of circus art. And I have a lady in her seventies that teaches the class for people from their sixties to their nineties are doing low flying trapeze. And when you hear that, you think like, wait, what? You don’t think of that for an older adult. So it’s challenging those beliefs.

Wes Moss [00:23:20]:
Low flying, I don’t know if you’ve ever even heard of that. You know what? I’ve seen people set up tightropes between trees that are pretty low. Maybe that’s a little different than trapeze. Trapeze is swinging. Where maybe I’m thinking about tightrope walking, which looks really, really difficult, by the way.

Erin Eleuterio [00:23:38]:
No. Yeah, trapeze is swinging.

Wes Moss [00:23:40]:
How about maybe talk a little bit about yoga? How do you like yoga as an exercise for someone who are, you know, call it 50 plus.

Erin Eleuterio [00:23:52]:
Yeah. I think yoga is a phenomenal exercise. One thing about yoga is it really ties into, like, your inner landscape, it ties into breath. It really makes you, it can make you more mindful. So I think it can really help with anxiety, things like that. And it can be a great physical practice for opening up your body. I think yoga is fantastic. But do it if you enjoy it.

Erin Eleuterio [00:24:18]:
I mean, that’s the big thing. Like, if it’s not fun, people aren’t going to stick with it. So if you don’t like yoga, like, don’t do it, or maybe find one or two poses that you do. Like, if you feel, if it feels good in your body, do that. I think yoga can be a phenomenal practice.

Wes Moss [00:24:33]:
I guess then you would say there’s really no exercise that we shouldn’t do. It’s pretty much whatever is fun we should be doing and not have limitations on what we should or shouldn’t be doing.

Erin Eleuterio [00:24:44]:
Yeah, I wouldn’t put limitations on it. The two things that I would keep in mind is if you have not been active at all and you are just now starting a physical activity program, a couple of things I would keep in mind that happen with age are, you know, your reaction time and being able to quickly move, you know, your physical ability to move quickly, um, and your bone health. So those are things to keep in mind if you’re starting later in life and if you don’t already have a movement practice. So I’m not saying don’t do those things, but just be mindful of, of how you are building that capacity and easing into exercises like pickleball. I mean, that pickleball is great, but, um, it is, does require quick movement reaction time. So give yourself time to ease into those activities. But I say, you know, sky’s the limit. If you want to do it, do it and find the right people to guide you and build up those physical abilities.

Wes Moss [00:25:34]:
It’s funny, I saw a research report from a financial services firm that was predicting the cost on the healthcare system in the United States to be. It was some multibillion dollar number because pickleball has gotten so popular. And of course, there’s more injuries, nominally, because there’s more people playing pickleball than ever. And it’s something like, er, visits and broken bones and surgeries, because of pickleball are going to cost the country billions of dollars. But of course, I think the, obviously the other side of that is that what are the health benefits of people actually being outside, being active. Of course.

Erin Eleuterio [00:26:09]:
Absolutely. And that’s the thing that’s kind of the issue I have with some of those things is the health care costs with pickleball injuries. And a lot of those injuries are, one, they’re acute, so they’re not lasting a lifetime, like cardiovascular disease, and they’re not taxing the healthcare system like diabetes, where those are really like, long haul, tend to be long haul types of diseases, whereas this is injuries. And what is this doing for people’s mental health and social health? And so I think the upside of pickleball far outweighs the downside. I would much rather see somebody coming in to a hospital from a pickleball injury than a broken diabetes. Yeah, or diabetes or a broken hip because they fell down the stairs. That should just be like a day to day activity should be able to do. So that’s really.

Erin Eleuterio [00:26:58]:
Yeah, I’m all for pickleball.

Wes Moss [00:27:00]:
Well, tell me some of the other maybe creative ways. I mean, you’ve already mentioned trapeze, low flying trapeze. But you’re in Colorado where it’s like, there’s no limit on activities out there for some. It’s a wonderful thing about Colorado. But what are some other innovative or just interesting ways that you’ve seen people get kind of make sure they stay active?

Erin Eleuterio [00:27:22]:
Yeah. So there is a couple of ladies that are doing parkour for people over 50. It’s parkour for seniors. This takes place in Wisconsin, and these two ladies have teamed up, and they take adults out to the playground and they practice parkour, which is typically known. Typically, you think of a lot younger people doing parkour, and you can think of, like, stunt doubles and things like that.

Wes Moss [00:27:48]:
Hold on. What is parkour? Parkour?

Erin Eleuterio [00:27:52]:
Yeah. So what is parkour? Yeah, essentially it is locomotion, but a lot of times you’ll see people, a lot of stunt double stuff, like, you know, on the extreme end of things, it’s people jumping off of buildings and jumping off of railings. And it is, it can be a pretty risky sport for those that are very advanced in it.

Wes Moss [00:28:14]:
You see these things on social media where people are jumping from a building to a railing to a stair to. Yeah, okay, so that’s called parkour.

Erin Eleuterio [00:28:23]:
Parkour, right. Yeah.

Wes Moss [00:28:24]:
This is like a light version of that.

Erin Eleuterio [00:28:27]:
Yeah, this is a scaled down version of that, of course. So it’s taking that parkour concept and that locomotion, like, at its core, it’s. How do you get from point a to point b? And, yeah, you could jump off of a building. That’s one end of it. Or maybe it’s like a leap, or maybe you are crawling or maybe you’re rolling. So they’re showing all these different ways that we can locomote with our bodies, and it’s more of a playful practice. And they’re taking older adults out onto playgrounds and doing that. It’s really a fall resiliency program.

Erin Eleuterio [00:28:58]:
They’re showing people how to fall, how to recover from a fall, how to be comfortable maneuvering on the ground and maneuvering your body in different ways. So that’s a really creative, very fun way that they’re keeping those people there physically active.

Wes Moss [00:29:17]:
Two brand new words I’ve never heard before. One parkour sec, and I’ve never heard of loca Motion those are two new words here to the podcast. That’s good.

Erin Eleuterio [00:29:27]:
Yeah, yeah. Locomotion just moving in space. I think there was a song about it.

Wes Moss [00:29:33]:
I wanted to talk about nutrition and diet here for a second. If I think about a. What do you think about the ozempic movement? I mean, it’s funny, I feel like every day I see another miracle side effect that was. I think I just saw that. I don’t know, there’s, what, a handful of these drugs that are similar, but it was that cures or helps sleep apnea, helps your heart, it reduces your weight. Obviously, these were originally just diabetes drugs. Have you seen success with that at all? Have you seen some of your. Have you ever talked about that on your podcast or seen anybody that’s had some success with one of these weight loss drugs and then it’s helped them be able to get back moving again as well?

Erin Eleuterio [00:30:17]:
Yeah, personally, I haven’t seen that. You know, I don’t work with people that have been on those drugs. I haven’t. Based on what I’ve seen years, anecdotally with. From colleagues online and stuff, people have had success with it, and I think that’s a personal decision that people need to make with their doctors and to see if that works best for them. I think it’s probably right for certain people. Yeah, I mean, that is definitely when you get into the drug part of things. I think that that is more personal decision with their doctor, and it can certainly have some health benefits, not against it, and it’s new.

Erin Eleuterio [00:30:54]:
So we will have to see what that holds in the future and how that holds for the older adults specifically, and how that’s influencing their body composition.

Wes Moss [00:31:06]:
Now, how about just nutrition? I mean, is it. I think of if you’re unhealthy, you’re not moving, it’s a wonderful leap to get moving and get active again, or for the first time. I think of diet maybe as a similar challenge where you can have an unhealthy diet for a long time, but it’s kind of never too late to get back to a healthy diet or restart a healthy diethouse. Have you seen people be able to make that switch? Or is that even harder than getting back moving?

Erin Eleuterio [00:31:38]:
Yeah, people make that switch. Um, sometimes I find that healthy habits can stack on top of each other. So maybe somebody starts moving and they start a pickleball practice, and now they start thinking about their nutrition. Like, what do I need to do to fuel this activity? Um, so I think sometimes physical activity can get people more engaged in their nutrition and thinking about how they need to be feeding their body to support the activities that they’re doing. And sometimes it works reverse. Sometimes people start thinking like they want to change their diet and feel a little bit better, and then they start thinking, well, what else can I be doing for my health? And now maybe I’ll start a movement practice or exercise. So I think that they can complement each other very well, and sometimes it starts with one, and then they build other health habits on top of that. Um, and nutrition is important.

Erin Eleuterio [00:32:23]:
We want to make sure that we’re having the nutrition to fuel the activities that we want to do, because nutrition is energy. So we.

Wes Moss [00:32:29]:
We.

Erin Eleuterio [00:32:29]:
Our body needs that. Our bones need, um, our bones, all of our organs need that nutrition. So I think it’s important to make sure we’re feeding ourselves, especially for those people that are very active and proteins are really big, is an important part for older adults.

Wes Moss [00:32:46]:
Well, I guess part of that is that. What is your experience with folks that are helping with nutrition as well? Because I think that’s hard, too. We live in this. We live in a world with information overload. There’s a million people that can supposedly help you working out. There’s a million people talking about this diet or that diet. Is it not necessarily about finding the perfect person for nutrition, but finding how many of these professionals that are helping folks 50 plus, are they, are they also helping with diet, nutrition, or is that somebody separate?

Erin Eleuterio [00:33:21]:
Usually some are, some are strictly just teaching a movement practice, and that’s all they do. But I have interviewed health coaches, and health coaches are really there, trained to teach and help people more, help people and be a guide for them along, adopting healthy habits. And so people, health coaches are really trained to make their client put their client in the driver’s seat of how they want to build a healthier lifestyle. So health coaches are doing that, and they’re the very skilled at partnering with their client in that regard. I’ve also interviewed people that are, let’s see if I get this right, functional, integrated nutritionists, where they are certified in nutrition specifically, and specialize in working with people over 50 on nutrition and looking at their blood work, seeing how they can help them with their nutrition habits, but also just really making it about, um, about them and making sure that it’s, this is realistic for them. It’s not dictating this is what you eat. It’s more of acting as a guide for them. So there are people that are specialized in that.

Wes Moss [00:34:29]:
So that’s a functional, integrated nutritionist.

Erin Eleuterio [00:34:32]:
Yeah, functional it’s a certification that they have. So I’ve interviewed a few people that have certified in that.

Wes Moss [00:34:43]:
When it comes to health coaches, are there any particular ways to. Any certifications that we should be looking for? What would be an industry type standard? If you’re looking for somebody who’s a health coach or something like this, and someone who’s a personal trainer, too, I guess those are two separate things. A health coach, a personal trainer. Is there anything we should be looking for?

Erin Eleuterio [00:35:05]:
Yeah, I mean, I would look that people have a certification and see if that certification is like an accredited certification so that they have the training, the credentials, when it’s accredited, it means that that certification met certain standards. So looking for those health coaches that have a certification, they’re not just calling themselves a health coach. There’s some kind of, they went through some training for that. Same with personal trainers. There are accredited personal training certifications.

Wes Moss [00:35:34]:
Are there hundreds of different accreditations and licenses or certifications, or are there like a top few? Like, are there three or four that.

Erin Eleuterio [00:35:43]:
Are really good personal training? There’s a top few health coaches. I’m not sure quite what the health coach is, which ones, how many are accredited, but, yeah, I would look for a nationally known certification. NSCA, National Strength and Conditioning Association, American College.

Wes Moss [00:36:02]:
NSC is one.

Erin Eleuterio [00:36:04]:
Yeah. American College of Sports Medicine, National Academy of sports medicine. Like, some of these are some of the well known accredited certification companies.

Wes Moss [00:36:15]:
Is it true that the norwegian study or the scandinavian study that playing tennis adds 9.7 years to your longevity and your life expectancy?

Erin Eleuterio [00:36:28]:
Oh, I have not heard that.

Wes Moss [00:36:30]:
Oh, you have not heard this?

Erin Eleuterio [00:36:31]:
No, I have not. I have not. Oh, interesting.

Wes Moss [00:36:35]:
For some reason, there’s always these great studies out of Scandinavia, or I guess it’s, it feels like so many interesting studies are from Norway or Sweden or whatever it might be, but they ranked, they looked, and it was a long study, it may have been a multi decade study that tracked different physical activities and then related those, it correlated those longevity, and it was pretty much anything that was active did relative to the control group that wasn’t active added a year or two or three or four or five years on average longevity. But tennis was number one, and tennis added on average. It was almost a decade of longevity to the participants of the study. So I’ve always been fascinated by that particular study, and I do think about some of the families that I work with over the years. Think about this. If you’re playing tennis and you’re 78, that’s a pretty darn good sign of your current state of health. And so maybe there’s a little bit of causation versus correlation, but. But I think there’s got to be.

Wes Moss [00:37:41]:
I think it probably works both ways. If you’re 80 and you’re playing tennis still. My goodness, there’s a lot of things that have to be going right for that.

Erin Eleuterio [00:37:48]:
Yeah. Oh, most definitely. Yeah. I mean, it’s a very reaction, you know, based sport. Yeah. I think that it’s phenomenal, and it’s. And there’s a social component, too, so I think that that’s amazing. Yeah.

Wes Moss [00:38:00]:
Well, and I think that some of the groups that you’ve talked about here, it’s. It’s both movement and the socialization is such a big part of this. I mean, we talk about happy retirees, on average, have 3.6 core pursuits, which we think of as hobbies on steroids, and they’re not necessarily all active. They could be music or woodworking, but a lot of them do tend to be exercise oriented. So they’re walking, the ings, the walking, biking, hiking, running, and then most of those can be really social, to your point. So it’s certainly a bias of a happy retiree to be doing something that’s a core pursuit that’s active. And it sounds like these are things that you’re constantly trying to get people to do and spread the word. And I love the thought that, what an interesting statistic that we’ve gone from 65 plus, only 4% used to be active today, now 14% over the last, what, decade or two decades?

Erin Eleuterio [00:38:58]:
Couple decades. Yes. Yeah. Yeah. And I feel like most of those people probably live in Colorado. No, I don’t. It seems that way. Yeah.

Erin Eleuterio [00:39:07]:
So they’re. They’re getting increasingly more active, and I think that’s super encouraging. And I really. That was part of the goal with the podcast, is to tap into that demographic and to tap into this whole idea of unretirement. I know you had a podcast recently on unretirement, and this is a trend. People want to continue working. And I think the last statistic I heard was, like, about 40% of people over 65 decide to return back to work. And so the goal with the podcast was to show people that are finding ways to encourage physical activity as, like, their second act career, and they know the importance of the social component.

Erin Eleuterio [00:39:46]:
So that comes up with all of these podcast episodes. They’re not just creating an opportunity for older adults to stay active, creating opportunity for them to stay social connected, which is the thing that people miss the most when they retire.

Wes Moss [00:39:59]:
So you’ve seen, folks, you had mentioned a financial advisor who ended up being some sort of coach as well. But so you see, people just have never done physical activity as a career at all. Just start later in life doing this. Not just doing it to get in shape, but actually helping folks.

Erin Eleuterio [00:40:18]:
Yeah. The lady that teaches low flying trapeze, she was in the tech industry before she retired, and now she’s teaching low flying trapeze. I had another lady that was a teacher also in it, and after she retired, she’s now teaching a program called Ageless Grace, which is a brain health exercise program. And she’s in her. She’s 77, and she’s teaching this at a retirement community. So she had no previous experience.

Wes Moss [00:40:48]:
Wait, what is that?

Erin Eleuterio [00:40:49]:
So, it’s using movement to help with cognition. So, our body helps our brain think when we move in certain ways, it helps with our cognition, and it helps with thinking. So, this brain health exercise program are giving people exercises that they can do in a group setting that are exercising their brain. So, if you want an example of one.

Wes Moss [00:41:17]:
Yeah, I need an example.

Erin Eleuterio [00:41:18]:
Try drawing a circle with your left hand, and then with your right foot, draw a square on the floor. That’s pretty tough. Yeah. It’s making your brain. It’s like rubbing your head, patting your stomach at the same time. So it’s a challenge to the brain.

Wes Moss [00:41:40]:
That’s like your left hand and your right hand on the piano doing totally separate things. It does take a lot.

Erin Eleuterio [00:41:45]:
Yeah, yeah, yeah. But it’s a really fun, playful program and helping people, you know, continue move, but also challenge the brain.

Wes Moss [00:41:54]:
I’m gonna. All day long, I need to be. I’m gonna be drawing. I’m gonna be wax on over here. Draw a square with my foot over here.

Erin Eleuterio [00:42:01]:
Yeah.

Wes Moss [00:42:01]:
And it’s helping my brain and my body altogether. I really do. I will say over the last several months as I’ve been back, kind of being much more movement oriented. I think a friend of mine asked, hey, what kind of workouts are you doing? And in my mind, I just said, they’re just total body. You’re doing all this. It’s not doing one particular thing, or I think about a bench press as a very singular thing. The kind of things that I’ve been doing have been, let’s say, squatting and moving a medicine ball all at the same time when you’re lunging. And I asked, so the gym I go to, I asked, like, what do you guys call this? I call it total body.

Wes Moss [00:42:45]:
And they said, functional. Something functional. Something, I guess functional working out or functional.

Erin Eleuterio [00:42:51]:
Functional training.

Wes Moss [00:42:52]:
Functional movement. Functional movement workouts where you’re doing a bunch of different things all at once and look, I don’t know. I hope I keep doing it. I don’t know. It’s.

Erin Eleuterio [00:43:02]:
Yeah, yeah.

Wes Moss [00:43:03]:
I hope I keep it up.

Erin Eleuterio [00:43:05]:
Yeah, yeah, absolutely. It’s using multiple joints a lot of times that’s involved with a lot of functional activities where it’s. I mean, bicep curls are functional, but pulling things like that recruit more muscles, and it is something that we do in day to day activities, so trying to mimic day to day activities.

Wes Moss [00:43:23]:
Yeah. And I do think it’s important. So even Flo Jo had a coach, and to me, it’s that a, you get a little bit of nudge when you have you work with someone, and I hope, and this is probably not every professional that does this or someone who does this as second act, but I think there is an awful lot to making sure you do not get hurt when you start working out, especially when you’re newer or let’s say you’ve been not as active and then you get active again. It’s so easy to kind of get hurt doing it even a little bit, and then it takes you back off track. And the one thing I’ve really appreciated with the group that I’ve used is they’ve been very careful about nothing, me not getting hurt, because they want you to keep coming back. So I just feel like that’s a really important question when you’re interviewing anyone that’s going to help you in movement, to really stress so that you don’t get hurt.

Erin Eleuterio [00:44:14]:
Yeah. Too much, too soon is the typical way people get injured, and it really needs to be strategic, what we call progressive overload, challenging yourself in a very slow, methodical way, especially if you are just getting back into this and having somebody to guide you through that process.

Wes Moss [00:44:35]:
Strategic progressive load. Yeah, I get that. Maybe I would ask, as we wrap up today, where should people go to look and find someone? Is it as simple as a Google, or is there any other place that you should be looking to find someone to help you, whether it’s a health coach or a functional, integrated nutritionist or a personal trainer? Like, where do we go to find these people?

Erin Eleuterio [00:45:00]:
That’s a great question. It depends on what you’re looking for. If you’re looking for a personal trainer that’s specifically working with older adults, there’s a couple places that you can go. Functional aging institute is a certifying agency, and they have a directory of people that have been trained there. Idea fitness is another place that has a directory of health and fitness professionals, and you can see kind of their bio, a little bit of the resume, see what their trainings are to see if they have the training that you are looking for. So I think idea is, would be a good fit for people that might be.

Wes Moss [00:45:32]:
Idea fitness is another one.

Erin Eleuterio [00:45:34]:
Idea fitness. Yeah, they have a directory, a directory for specific health coaches I’m not aware of. But idea is probably a great place to start to find health coaches as well as people that are certified in fitness and make sure that they have the credentials and the training.

Wes Moss [00:45:51]:
Before we go, I also wanted to ask you about your group training you work with. What’s the average age of the folks that you typically are working with?

Erin Eleuterio [00:45:59]:
So I teach at a senior living facility and the average age is probably around 80. And I also do this parkour type. I call it a parkour based fall resiliency there. So we are doing, we are moving in different and creative ways around hallways and dining rooms. So that’s one place that I teach, and then I teach at a senior center, a local senior center. So it’s a little bit younger, seventies, and I incorporate some of those parkour type methodologies, but also resistance training so that they are building up their strength. Because essentially my goal is I want people to be strong and resilient for a lifetime. That’s my goal.

Wes Moss [00:46:39]:
Tell me about silver sneakers. Is that a. Was it. Is that what it is?

Erin Eleuterio [00:46:45]:
There is a fitness program called Silversneakers. Yes. And it is a. It’s a program that’s tied to specific health plans. So when. When people have a specific health plan, they. It could be a Medicare advantage plan. It could be a group retiree plan.

Erin Eleuterio [00:47:01]:
They may have that benefit of silver sneakers, which gives them access to. It could be fitness centers. I think they might have access to online fitness resources.

Wes Moss [00:47:11]:
Do you like a program like Silversneakers? Is that known to be good or.

Erin Eleuterio [00:47:16]:
Yeah, it’s been great. I actually used to work for silversneakers. I did. I did. But it’s been a long time. It’s been a little while since I worked for them. So I think things have evolved since I’ve worked there, and I don’t know how things have changed since the pandemic, but it’s a fantastic program to get people active, and sometimes it lowers that barrier of I need to pay for a fitness membership. So for some people, it just makes it a little more accessible for them.

Erin Eleuterio [00:47:41]:
And there’s some great programs going on online for those people and at those participating locations. So it’s worth checking to see if people have that benefit.

Wes Moss [00:47:52]:
As we wrap up, one thing that our listeners can do today, Erin, to get motivated to do something.

Erin Eleuterio [00:48:01]:
Yeah. I would just go back to that mindset of how do you need to move today to be able to move tomorrow? What do you need to do to engage in those activities that bring you joy?

Wes Moss [00:48:15]:
It should be fun.

Erin Eleuterio [00:48:16]:
It should be fun. It should be fun.

Wes Moss [00:48:18]:
Should be fun. Social. It shouldn’t be a grind. And then where do we find more about you and your podcast?

Erin Eleuterio [00:48:24]:
Yeah, so my podcast is called second act fit Pros, and you can find it at all the outlets for podcasts. My website is Erin Elou. E l e u. I did not do my whole last name. It’s too long.

Wes Moss [00:48:39]:
Erin Elou. Okay.

Erin Eleuterio [00:48:41]:
Yeah, I do teach an online class, the parkour based fall resiliency program online, so you can do parkour at home. So those are the best places to find me. And I’m also active on LinkedIn. So if you want to connect with me on LinkedIn, I’m happy to do that too. But those are the best places.

Wes Moss [00:48:56]:
And I bet you’re connected to some good folks. I bet you’re connected to people that are health oriented, health coach, functional integrated nutritionists. I bet you you’re connected to some of those folks.

Erin Eleuterio [00:49:08]:
Absolutely. I am happy to connect people.

Wes Moss [00:49:11]:
Oh, cool. Okay. On LinkedIn, I think we’ll find Aaron E. Luterio on LinkedIn as well. So awesome. Well, listen, Aaron, thank you so much for being with us today and sharing this idea that we should move. It should be fun. It should be creative.

Wes Moss [00:49:25]:
It doesn’t have to be that we have to hire an expensive personal trainer to get back jim, but just have fun and get back moving again. Is it’s really about your health span as opposed to just your lifespan?

Erin Eleuterio [00:49:38]:
Absolutely.

Mallory Boggs [00:49:40]:
Hey, y’all, this is Mallory with the retire sooner team. Please be sure to rate and subscribe to this podcast and share it with a friend. If you have any questions, you can find us@westmoss.com dot. That’s wesmoss.com. you can also follow us on Instagram and YouTube. You’ll find us under the handle Retire Sooner podcast. And now for our show’s disclosure. This information is provided to you as a resource for informational purposes only and is not to be viewed as investment advice or recommendations.

Mallory Boggs [00:50:08]:
Investing involves risk, including the possible loss of principal. There is no guaranteed offer that investment return, yield or performance will be achieved. Stock prices fluctuate, sometimes rapidly and dramatically, due to factors affecting individual companies, particular industries or sectors, or general market conditions for stocks paying dividends. Dividends are not guaranteed and can increase, decrease, or be eliminated without notice. Fixed income securities involve interest rate, credit inflation and reinvestment risks and possible loss of principle. As interest rates rise, the value of fixed income securities falls. Past performance is not indicative of future results. When considering any investment vehicle, this information is being presented without consideration of the investment objectives, risk tolerance, or financial circumstances of any specific investor and might not be suitable for all investors.

Mallory Boggs [00:50:52]:
Investment decisions should not be based solely on information contained here. This information is not intended to and should not form a primary basis for any investment decision that you may make. Always consult your own legal, tax or investment advisor before making any investment tax, estate or financial planning considerations or decisions. The information contained here is strictly an opinion and it is not known whether the strategies will be successful. The views and opinions expressed are for educational purposes only as of the date of production and may change without notice at any time based on numerous factors such as market and other conditions.

Wes Moss [00:04:02]:
Now, that last part was not a Morgan housel quote. That was just me. But I love this. We think so much about money. We obsess over money just so we can never have to think about it again. I wish I’d come up with that. But Morgan Housel, he’s just so good and he’s so right about it. So we live in a world where again, we’re all after economic freedom.

Wes Moss [00:04:26]:
That’s what the retire sooner. That’s what this podcast is all about. It’s about getting to economic freedom and not having to worry about money. Even though right now you’re listening to the podcast and you are worried about money, or else you wouldn’t be listening to the retire sooner podcast. Maybe you would.

Jeff Lloyd [00:04:43]:
Or maybe they’re interested in money and they’re interested in retiring sooner and better. And yeah, put it all together, becoming a better investor.

Wes Moss [00:04:52]:
In short, monetary security allows happy retirees to sleep well at night. And we live in turbulent times and that makes markets turbulent and the economy is turbulent and politics are turbulent. And it’s always rocking the boat back and forth. And it’s not uncommon that we end up seasick. And when we get seasick, we end up making mistakes and we end up saying, I’m not going to follow my plan. I’m not going to invest like that. Artificial intelligence is telling me, and I’m not going to listen to what history is saying. I’m going to do what I’m thinking in my gut because my behavior is driving my investing now and not my logic.

Wes Moss [00:05:35]:
And that’s normal and fine because we’re human. And thank God, we’re still human, and we’re not just run by a myriad of funky named artificial intelligence. Google is what’s Twitter is.

Jeff Lloyd [00:05:48]:
Which one’s gronk?

Wes Moss [00:05:50]:
Is it gronk or gunk? Twitter’s has a name for their artificial. So there’s Chachi, BT, which is the most benign name. Then you had Bard, which was Google, that just changed to Gemini. Gemini. And then you have X, which is named Grok, I believe Grok. And then you have Claude, and then you have PI get a bunch of seemingly names to make these seems, these things seem normal, human, and friendly, but we’re not that. And by the way, would artificial intelligence be able to take over our investments? Of course it could. Of course it could.

Wes Moss [00:06:31]:
And it could probably do an amazing job. But guess who controls the artificial intelligence? You. Me, people, humans. And we had an age of robo advisors that were set up essentially with artificial intelligence to buy and sell at this formulaic time and follow history. And guess what? It didn’t work because investors still have the keys to their own account. And when it wasn’t working, human behavior, BFI comes into play. And, eh, I don’t think so. So that’s the world we live in.

Wes Moss [00:07:04]:
But we’re all here on the retire sooner podcast to get to a point of economic freedom as soon as we can, so we can do all the five money secrets of the happy retirees. I’m going to put myself on the spot here. We know the five money secrets of the happiest retirees. We’ve just recently done that on a podcast, the five lifestyles of the happiest retirees, which maybe that’s why even people with plenty of economic freedom, Jeff Lloyd, are still tuning in. So I’m going to put myself on the spot here. What are there are five most important lifestyle secrets of the happiest retirees. One, 3.6 core pursuits. Those are hobbies on steroids.

Wes Moss [00:07:42]:
It could be duck hunting, could be fishing, could be woodworking, cruising, grilling, golf, tennis, pickleballing, you name it. Two, family habits. Essentially, we want to live near at least 50% of our adult children and not overfund the spending of our adult children. Three, love life. Marriage has a high correlation to happiness and retirement. You don’t have to be married to be a happy retiree. But if you are, you’re four and a half times more likely to end up in the happy camp. Four social, three to four close connections.

Wes Moss [00:08:21]:
Those are not hobbies on steroids or friends on steroids. Those are people that you can call on a bad day or a great day. Those are close long term connections. And then five is faith. Happy retirees, they go to church. Part of that, I think, is just being part of an organized social group. So it goes back to the prior, but going to church once a week increases retiree happiness levels, or one and a half times more likely to end up a happy retiree. Maybe that’s why people are tuning in, if they already have plenty of money to retire.

Wes Moss [00:08:54]:
Here we are talking about the three ways to sleep well at night when it comes to your retire sooner journey. So the three keys to help us sleep well at night when it comes to this process and this journey, they start and they revolve around what I would call the investment bucket system. It’s a way to think about diversification and asset allocation and cash flow all at the same time. So we have this fundamental foundation set up. We know that we’re all after total return. Total return is a pretty simple formula. It’s growth or appreciation plus income. Now growth, that part of the equation can be positive or negative at any given day, week, year.

Wes Moss [00:09:35]:
Income is almost always additive. You can’t really have a negative dividend. Maybe. Jeff Lloyd there’s a way for some derivative to take away cash flow. But in the end, if you get paid a dividend or you get paid interest or you get paid a distribution, it’s cash flow. So it would be, if I can remember from math class, it would have the bars around. It would be absolute. It would always be positive.

Wes Moss [00:09:58]:
So we start with the cash bucket. Jeff Lloyd this is just the super safe bucket. We think we should be able to get 5% in this bucket right now. But as we know, some of the big banks, yeah, the big banks are.

Jeff Lloyd [00:10:10]:
Still paying zero to half a percent for money markets sitting in cash. And you can get upwards of three to percent, four even. I’ve seen cds and money markets pay anywhere from five to 6% recently.

Wes Moss [00:10:25]:
But you have to be proactive about it. And I think that the big banks, their philosophy is if it’s cash, we’re going to leave it, not pay really almost any interest in it. And if you want to take it and put it in a money market fund or a CD, then you’re fine to do that, but this is your safety money. So your first bucket is the cash bucket. It’s designed to be your emergency fund. That’s part of the money that helps you sleep all night. So yields could still be close to zero, but if you’re proactive about it, those yields should be between three and 5%, at least in today’s world. Bucket number two, it’s the income bucket.

Wes Moss [00:11:00]:
Now, quick caveat. All of these buckets should be able to pay some level of income, but this one is focused in on securities that are really designed just for income, and that’s bonds. Fixed income. Yeah.

Jeff Lloyd [00:11:14]:
Think us government bonds, corporate boggs, high yield bonds. Now, high yield may sound risky, but that just means that they’re paying a little bit more out in income and yielding a little bit more.

Wes Moss [00:11:27]:
And to your point, you go from a treasury that can be three to 5% historically, all the way up to a high yield bond that can be six to 8% historically. So that’s the range. That’s the range of cash flow you can get from that particular bucket. That is a variety of bonds, and that is the category of interest.

Jeff Lloyd [00:11:48]:
Yeah, and it’s a variety of interest in bonds. But also you can look at it through like a duration standpoint of you’re getting x percent of yield for five years or x percent of yield for 20 to 30 years.

Wes Moss [00:12:02]:
So you’re also thinking duration, short term, intermediate term, long term, when it comes to bonds, and they pay out interest. And if it’s not in a retirement account, just a regular after tax account, remember, interest is taxed at ordinary income, so that’s something to think about. Then you have the next bucket, the growth bucket. In my opinion, this is the real workhorse bucket. It’s the real engine of all the buckets with yields or income that can be relatively low. The S and P 500 only pays out around one and a half percent, not even quite that much in dividends. But then you can start thinking about adding in some of the sectors that do pay two, three, 4%. Think utilities, healthcare, energy sector, consumer staples, and you end up with this diversification.

Wes Moss [00:12:53]:
Many different stock categories. Some pay a little bit of income, some pay a lot of income, but in this bucket, the cash flow comes in the form of dividends. And if we’re outside of a retirement account, the good news about dividends is they have a much more favorable tax category. For the most part, we’re able to keep more of our dividend income relative to interest income, which tax debt. Ordinary income rates, dividends have their own special category called dividend tax rates. So think of the growth bucket there for the appreciation of those stocks over time and the dividends that we’re getting from a variety of stocks within that bucket. Next up, the alternative income bucket. Jeff Lloyd, give me some examples of what’s in that.

Jeff Lloyd [00:13:39]:
These are your energy pipeline companies, your master limited partnerships, real estate investment trust, or reits, as they’re commonly referred to. You got preferred stocks closed in funds.

Wes Moss [00:13:51]:
So anything that’s not, let’s say, purely a stock or a bond, this is why we have this middle bucket. That is some of the categories in between. And we can find reits today or real estate investment trusts that are in the two and 3% annual yield range. So not overly exciting all the way up to seven, eight, 9% for some of the pipeline companies. So it’s a really big range in this alternative income bucket. So that’s it. We have income, we have growth, we have alternative income. It’s three main buckets that are there to make up your overall retirement portfolio.

Wes Moss [00:14:31]:
And the next big decision you need to make is, what is the percentage that’s right for you in each one of those very different buckets?

Jeff Lloyd [00:14:38]:
Yeah, because all those buckets are not going to be the same size if you’re older retiree, your income bucket is going to be core filled than your growth and alternative bucket for the most part.

Wes Moss [00:14:50]:
Right, exactly. So if you’re 30, it may be 100% in the growth bucket. If you’re 65 and you’re starting to pull money out, you may really like the idea of having a higher percentage in something that’s even more focused on income. It could be the income bucket, the alternative income bucket, and you’re really looking for that cash flow. But if you think about putting it all together, in going back to that equation, total return equals growth plus income. Again, we can get growth over time out of the growth bucket. We can get some growth and, again, appreciation out of the alternative income bucket, because some of those are very stock like. Think real estate, think energy.

Wes Moss [00:15:28]:
But we don’t expect to get a whole lot of growth. We almost only get income from the income bucket. We’re not expecting our bonds to go up a whole lot up in price. And if you put all of that income together, the dividends and the interest and the distribution, and we’re looking at it conservatively, maybe your income, maybe the whole cash flow is only 3%, but it’s this drip, drip, drip of 3%, and then that should be year after year after year. So in any single year, it might not feel like it really moves the meter, but again, the G could be up or down ten or 20% in any given year, but over five years. So if we give it time, it’s very rare for that G, the growth bucket, to be negative. If we give stocks time, it reduces the likelihood that we end up not having appreciation. So we want to give the growth bucket as much time as possible.

Wes Moss [00:16:32]:
Thinking about retirement in 2024? Well, you’re not alone, and I’ve got just the thing to help guide you on your journey. What the happiest retirees know my most recent book that shares the ten habits of the happiest retirees, meant to help you land at a place where work becomes optional for a limited time. Get 25% off@westmossbooks.com. Simply use the promo code. Our treat, all one word at checkout. That’s westmossbooks.com. Here’s why I like this bucket cash flow system. Now, all the while, you’ve allowed your portfolio to either grow or recover from a fall and ultimately make new ground through appreciation, the income, again, maybe not so much in any given one year, really starts to add up.

Wes Moss [00:17:24]:
Think five years later, the drip, drip, drip of that 3% is now over 15%. And ten years later, it’s hard to ignore the drip, drip, drip of 3%, which is now over 30% in income for your total return equation. So the more time we have to utilize the bucket system, the more that income starts to compound in an additive way.

Jeff Lloyd [00:17:50]:
Okay, so I like the buckets.

Wes Moss [00:17:52]:
You like them or love them?

Jeff Lloyd [00:17:54]:
I love the buckets.

Wes Moss [00:17:55]:
Okay.

Jeff Lloyd [00:17:56]:
In fact, I would put all four on my bucket list, okay. Along with a cruise to Alaska with some friends. But just those four buckets. And however you use them and however you film, is that all you need to be able to sleep well at night? Or is there something else?

Wes Moss [00:18:12]:
They’re part of the following. There’s three other thoughts here, and these are the keys to help investors just reduce their anxiety. Sleep well at night. One, you got to have some sort of plan. The bucket itself isn’t the plan. The plan is looking out into the future and understanding how much money you think you’re going to need. And it doesn’t have to be exact. And I think investors get paralyzed a little bit around this.

Wes Moss [00:18:38]:
I don’t know my exact spending. I haven’t looked at my American Express bill, and I don’t know. We know to some extent what we spend per month. We spend five grand a month. We spend ten grand a month. I talk to families all the time that know, look, every single month, it comes out to about eight grand a month. And they know. So it’s not that difficult to come up with an objective.

Wes Moss [00:19:00]:
You can do a 75 page financial plan, or you can do a one page retirement timeline and map it out year after year. Look at your different income sources. Social Security one. Social Security two. For you, for your spouse pension one. Pension two. Let’s say that adds up to $5,000 a month, but you need ten. The plan says, all right, well, if we need $5,000 a month, in addition to my income streams, how much money do I need to have? The plan helps you do that.

Wes Moss [00:19:29]:
Now, you can use. Speaking of how much money you need to get to at that point, you could use one of my favorite rules of thumb, which is the 25 X rule. Need five grand a month. Times twelve is $60,000 a year. Times 25 gets us to a million and a half million and a half dollars. The 25 X rule is the inverse of the 4% withdrawal rule. So it solves for that, too. So now we know that if I need that five a month, 25 X rule pretty simply says I need to make sure I’m at 1.5 million in liquid retirement assets.

Wes Moss [00:20:05]:
By the way, pretty close to the one and a quarter million, which is the inflation adjusted number for happy retirees, mean it’s the average. And then the bucket system is the carriage that takes us there. It’s what gets us to the $1.5 million over time, as Wes map it out. So that’s, number one, the power of a plan. Number two, understanding cash flow. And this is one of the byproducts of the bucket system. You don’t need this when you’re 30 or even 40 or even 50, but by the time you’re in your is psychologically now we’re going back to BFI. To not have to dip into your principal and pull out and sell shares.

Wes Moss [00:20:50]:
It is helpful to have at least some of or all of your cash flow needs solved by that pesky two, three, 4% a year that comes from dividends and interest and distributions. It all adds up to a cash flow. And that cash flow can give you great peace of mind. We’ve talked about how, over time, 3% over ten years is over 30% worth of accumulation, but also gives you time for the growth bucket that’s a little more erratic to end up in a positive place. Markets go up over time, but not in a straight line. And then three, the power of diversification. This is investing 101. We know this one.

Wes Moss [00:21:37]:
We know we don’t want to have high concentration in any one given stock because God forbid something happens and it’s down 30, 40, 50% in a day, or something really bad happens and the company is materially damaged and you don’t ever recover. We don’t want to be overly invested in one particular area. Right now, the world is so focused on technology companies, I’ve seen investors that say that technology is the only place that’s ever going to make any money. So 100% is in tech. That’s scary to me. So diversification, of course, is multiple stocks, or etfs, or baskets of companies that have 5100, 500 different companies, so that we take away any single stock risk. But I think it goes a little beyond that to making sure we’re not overly invested in one particular sector of the market. Taking away single stock risk, which is yet another arrow in your quiver when it comes to reducing anxiety, taking another risk off the table so we can again sleep well at night, and the bucket system through that allocation of different areas of the marketplace, and then through diversification within each bucket.

Wes Moss [00:22:47]:
I think it does a lot of that diversification wes, all need so that we can sleep well at night.

Jeff Lloyd [00:22:53]:
Yeah, that’s what I was going to say. The power of diversification within, let’s say, the growth bucket. You got the etfs, but also each bucket itself is inherently diversified. You got bonds, you got your growth bucket with equities and etFs. You got your alternatives with the reits, the energy pipeline companies, the closed in funds, the preferred stocks, all different types of diversified income streams within those multiple buckets.

Wes Moss [00:23:21]:
Jeff Lloyd agreed. We can’t control inflation, we can’t control interest rates, we can’t control who’s going to be in Washington. We can’t control what the economy does. But we can manage our anxiety when it comes to investing. And if you remember these three powerful steps of lowering anxiety, we call it sleep well at night swan, then I think you increase your chances of finding happiest in retirement because we’re taking the kind of the investment boogeyman at least off the table or at least out of the room.

Jeff Lloyd [00:23:59]:
Yeah, I think that’s great. It allows retirees to worry less about the financial aspect of retirement and focus more on the lifestyle aspects of retirement.

Wes Moss [00:24:09]:
It brings us back to Morgan Housel. We work all our lives to scrimp and save buck our own emotions so that we can be good investors. Just so, as Morgan Housel says, we don’t ever have to think about it or worry about it again. So that and we know the five money secrets of the happiest retirees. But if we’re really doing it right, we get to focus on the five lifestyle secrets of the happiest retiree. And that is something I think we can all work towards.

Mallory Boggs [00:24:44]:
Hey y’all. This is Mallory with the retire sooner team. Please be sure to rate and subscribe to this podcast and share it with a friend. If you have any questions, you can find us@westmoss.com that’s wesmoss.com. You can also follow us on Instagram and YouTube. You’ll find us under the handle Retire Sooner podcast. And now for our show’s disclosure. This information is provided to you as a resource for informational purposes only and is not to be viewed as investment advice or recommendations.

Mallory Boggs [00:25:12]:
Investing involves risk, including the possible loss of principal. There is no guaranteed offer that investment return, yield or performance will be achieved. Stock prices fluctuate, sometimes rapidly and dramatically, due to factors affecting individual companies, particular industries or sectors, or general market conditions for stocks paying dividends. Dividends are not guaranteed and can increase, decrease, or be eliminated without notice. Fixed income securities involve interest rate, credit inflation and reinvestment risks and possible loss of principal. As interest rates rise, the value of fixed income securities falls. Past performance is not indicative of future results. When considering any investment vehicle, this information is being presented without consideration of the investment objectives, risk tolerance, or financial circumstances of any specific investor and might not be suitable for all investors.

Mallory Boggs [00:25:56]:
Investment decisions should not be based solely on information contained here. This information is not intended to and should not form a primary basis for any investment decision that you may make. Always consult your own legal, tax or investment advisor before making any investment tax, estate or financial planning considerations or decisions. The information contained here is strictly an opinion and it is not known whether strategies will be successful. The views and opinions expressed are for educational purposes only as of the date of production and may change without notice at any time. Based on numerous factors such as market and other conditions.