TRAP: The Real Adviser Podcast

16 - KISS and Tell

• Episode 16

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In this latest pile of TRAP, the Trap Pack discuss

  • Three glowing reviews of the podcast, read by Andy in his inimitable style
  • Topical issues, including Ireland scraping home against a severely depleted England; massive pension changes in the UK; an MBO with Métis Ireland.
  • Meat and Potatoes: Keep It Simple Stupid (KISS). Why do so many overcomplicate?
  • Questions posted by our beloved Trappists @matt_aitchison, Colin Bates
  • Culture Corner

Links referred to in the show:

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Unknown:

Welcome to The Real advisor podcast, t r a p twerp. Please follow us and join in the conversation on Twitter at advisor podcast where you can suggest ideas and themes you'd like the truck team to discuss. Also remember to like and subscribe to our YouTube channel and leave a six out of five star review on iTunes. Doing all this really, really helps us which means we can do more to help you. Now let's head over to the studio for the latest pilot trap

Nick Lincoln:

yes, indeed they practice Welcome back to The Real advisor podcast T R A P trap episode 16. My name is Nick Lincoln. Joining me as ever are the three other Horsemen of the Apocalypse. The rest of the Track Pack call the voice which and the heart and Alan the storyteller Smith. Now the last Episode Episode 15. That was by a country mile. I think our most influential episode, certainly our most popular in terms of downloads we got through we basically got through the 2000 downloads mark in in eight days, which is which is really good for for podcasts just 15 episodes in so thanks to all of the Trappists who took part in the social conversation, I think we moved the dial a little bit on on the reception of SJP. And that's what we're here for. We're really we just want to we want to have a chat with you as our audience and we want the show formed by you and we want to hit the nail and we don't always want to be popular. And all four of us in our lives have been really good and not always been popular. It's probably our biggest, biggest achievement the thing we're best at. Right gentlemen, we have a show pack full of absolutely nothing. So let's start unpacking it straightaway. Andrew, I know you're all fired up. You've got that enthusiasm that Brio going to give us some more really nice reviews of trap.

Andy Hart:

Over to me for the reviews first review is from Ken Witter on the Apple podcast platform, making financial advice fun five stars if you're a financial advisor who wants to be an actual financial advisor or not a product seller, this is the one for you six stars sorry, couldn't find the sixth one Nick. Next up is from cogent 14 fivestars gold mentors done the course is the learning the wisdom, three kisses. final review is from GM 11. By advisors for advisors, five stars. I picked this up from the fantastic Andy Hart Maven money podcast. I love this podcast. Thank you Trappists also would say I particularly like that everyone has their own particularly passionate views and are not afraid to disagree. Keep it real. Back to you Nick.

Nick Lincoln:

Great, great stuff. Thanks, everybody for the review. So topical titbits give this episode episode 16 a timestamp. Okay, let's get it out of the way. Let's defer to our man in Ireland. Well done. Well done my friend.

Carl Widger:

And then also they'll also see that I was deeply uncomfortable with the content of some of today's going to the Irish versus UK cultural differences

Nick Lincoln:

does that take you back to the Aviva Stadium and you put that video out of the crowd was going absolutely mad when the matches in the in the bag. It looked it looked amazing.

Carl Widger:

Yeah, was it? Yeah, Ireland Grand Slam champions 2023 In the same year as a World Cup. What could possibly go wrong? It was an amazing day I met I managed to blag myself some tickets for myself and my kids. So the five of us went up and it was just an incredible day. What was brilliant about it was after the game everyone in the stadium stayed in the stadium was absolutely rockin it was just superb. And yeah, Freddie Stewart should not have been sent off without any question Are we sorry? Not even slightly so yeah. For this data remember for for absolute you're one to remember and very, very hopeful although unbelievably tough draw in the world got very very hopeful for what might happen concept timber, October.

Alan Smith:

You're up against Scots. There's a date in October in Paris Saturday night. We might even go and watch it. That will be an interesting

Nick Lincoln:

tear gas looking at the recent videos of France Okay,

Alan Smith:

but why is that? That's because these state pension age in France is being pushed back from age 62. And they're going absolutely nuts. Yeah,

Nick Lincoln:

but it's not there's something else there because most of the writers are in their 20s. If you're if you're 25 you don't care the state pension that you can't even imagine getting state pension age there's something there's a lot. There's a lot of tension in front I suppose it's not go down there, but Paris. Okay, so typical tip is yodeler website that I found I'm sure some of you I'm sure Andy knows of it. If you ever want to I face trapeze if you ever want to a one stop shop a site to to have reports that demolish wealth managers go to yodeler. I'll put a link to it in the so called show notes. So called, so called, but they the latest demolition job was on Fisher Investments, and I'll leave it at that. But quite a useful, useful site.

Alan Smith:

Having had such a positive trap episode last time, regarding SGP, they do they do a demolition job yield law. I don't know who's behind them. But I've had a look at a few of the companies they review. And the judge Emily. Yeah, demolition is the

Andy Hart:

word I think. I think there's a controversy who backs yodeler? So yeah, look into it yourself if you want to do you know? Yes, a few companies. That's why it's a little bit controversial.

Nick Lincoln:

Okay, the next the next topical chip at the call this is this is very UK Central. But we have to mention it because it was massive was the the most recent Chancellor. This year's Chancellor Jeremy Hunt, came up with his budget. And there were some floated rumors that the lifetime allowance will be raised to 1.8 million back to where it was a few years ago. Which would have been nice. And maybe the annual allowance will get fiddled around with the tapered annual allowance the money purchasing announced Well, he's basically he got rid of the lifetime allowance, as we all know, he got rid of the lifetime allowance and increase the annual allowance to 60,000. Mr. Hart, what do you think about that?

Andy Hart:

Well, I think the key word Nick is abolished. abolished the lifetime allowance. And in recent years, it's all been talked about rich, reducing the annual allowance. It's rather odd, there must be more going on with this than we know about as such, because years ago, it was the pension death tax that used to be 55% on death. That's why people spent their pensions quite aggressively. We all said That's a bit harsh, it should be reduced, or you know, Chip down a bit. I think Gorgeous George made the changes, and he reduced it down to zero. And nobody was asking for it. It's very odd. And again, the lifetime allowance, we were like, it's a bit hard to be in 1073 100 It'll be good. If it goes up to 1.8. And they're really polished it again. So the pension. I mean, we're in the golden age of pensions, the gift that keeps on giving absolutely fantastic 70% of the money I look after his intentions, it will probably be at 90% Over the next few years. 60k you can do per annum 120k for a couple I mean, yes, it is helping out the rich. But I think the real impact of it is going to be less brain drain. Obviously technical, qualified people in various different professions will now hang around a bit more at the final years of their peak, you know, contribution to their professions, rather than thinking of it as just bugger off because I'm just getting hammered from tax left, right and center. So yeah, huge news for us. Great news for lots of planning opportunities. Also the corporation taxes going up. So again, it's more it's just every every single way you look, the pensions are getting better and better and better. So yeah. All good. Oh, do you Alan?

Alan Smith:

Yep, every thought, I think is absolutely right, that the lifetime allowance should be abolished, because otherwise there's attacks on people taking risk and investing in equities and likely to perform better than other asset classes. Nick, you wrote a really good piece of the I don't know, it was a few years ago, because you posted up on something that I saw recently, she posted a link to it on the so called show notes as well, too, because it was you know, it gave an example of exactly that are people being penalized for doing what is actually productive activity versus others. So I think it's right to that goes. But inevitably, the Labour Party announced that if they win the next election, they will reverse it all and then they subsequently tweaked it a bit to say the reverse at all apart from workers for the NHS. So everyone who works in the private sector or everyone indeed, who works in the public sector, but not in the NHS, which is a few 100,000 or million people will be disadvantaged and good loss trying to get that. But we'll see. Yeah, it makes in theory, it makes life very difficult to do long term because we're all in the long term financial planning game. And if you've got new legislation that's come in that might only be there might be reversed within two years. But as I've always said, we can only play the you know, the cards in front of us we can only base our decisions or advice on the legislation as it currently exists and not speculate otherwise we'd have never invested in pensions before at all because every single year every pre budget, you know tax free cash or pension commencement lump sum is rumored to be being removed or reduced. And there is a slightly insidious part of this legislation which is we know the life of the that Some that tax free cash amount is being frozen at a particular level and over time that will have a greater impact on the overall tax efficiency of pensions, but in the short term is definitely good news and creates far greater planning opportunities. So one small positive step by our current government.

Carl Widger:

Yeah, just a quick comment for me. I think, look, the point is well made out and about legislation changes it, it doesn't just point out how difficult it is for the DIY investor who's not looking at this stuff all the time. You know, you need to have somebody in your corner who is looking at all these changes all the time and making sure that you're aligned with the latest regulation in terms of tax and etc. And yeah, look at this comes hot on the heels of the of the big changes in the Irish pension regulations last December, we still do have a limit, it's 2 million or 2.1 5 million, really, but you can pay in whatever you want. So we don't have the annual limits, but we do have an overall limit. That can only be good for anybody who's doing proper financial planning. I also got to see you guys following on suit from the Irish guys.

Andy Hart:

Well, it sounds as if we've got the opposite. Full the opposite. You have no limit yo, no annual allowance, but you have a lifetime allowance. Final point on this. I mean, as a practicing financial advisor, we, we we have issues with this all the is what you tilt towards is usually the pension beats the Eisah for a client, but I sort of do a sort of 8020 Okay, well, sort of diver at between percent of the capital there 20% here because the rules could change. So I don't want to go all in on the strategy at the time I sort of split split it out a bit. I think it's called asset location, that sort of discussion with clients. But yeah, at the moment, certainly the pendulum wins in pretty much every comparison. Really? Yeah. Back to you, Nick.

Nick Lincoln:

Yeah, yeah. And I mean, from a political This is not a political comment. And he's not going nervous. Hunt was very clever. The way he framed it, because he made it all about the NHS doctors. So and of course, that's the that's the labor high ground really, you know, so if they do come in, if they do unwind this, they're going to probably try and to have to carve it out for the doctor, which I think is almost impossible, because if you carve it out for the doctors and the NHS, the civil servants are gonna say, Well, hold on how come they've got a carve out and we hadn't. So I think that was really well played by him but but we'll see all we can do is act you want you mentioned today, all we can do is act on what we know now, right? If you if you were going to wait for the next government, or the next thing, you'd never do anything, you'd be permanently in a state of stasis of doing nothing, we can just act on what we know now. And it's just crack on. This is very good news. And for my OCD side of me how nice to have an annual allowance that's divisible without any pence at the end. Five grand a month. Dot prostrate on lovely not 3333 pounds 33 Pence and for next topical tip. Yeah, exactly, or you've done your tax relief calculations. Andy Yes, that's good. You should pay someone to look up a spreadsheet to do that. Aegon reduces cash interest rates and has planned for me I saw this it just I mean Christ Talk about bad PR, Aegon somehow is reducing the cash it pays on its platform at a time when interest rates have gone up from effectively zero to four or 5% in this country in a record period of time. And I read the article a city wide there was a link to it and they try and justify it I just think some of these big corporations are so teeny there's no excuse for doing if you're going to do it don't do it now.

Alan Smith:

I think if he goes over what was their reasoning Oh, it was

Nick Lincoln:

there was they've overpaid in the past. I can't quite remember I kind of lost the ball to live really it was it was Yeah, I don't know what will you know,

Alan Smith:

cash on platforms generally and certainly from a historical learning to be honest, single biggest profit center why

Andy Hart:

don't why don't they just be honest and say we're a business and in order to be profitable. This is how we're going to treat our cash

Alan Smith:

the amount of money that the likes of Hargreaves Lansdown make on their cash Charles Schwab?

Andy Hart:

BlackRock Yeah, all of them Vanguard Yeah, they all make loads

Nick Lincoln:

of money from cash. It's a real differentiating point. I mean, you know, if you use Transact you know that when the base rate is naught point two, five the clients are gonna get nothing on the cash because they'll but when the rates go up, they they don't retain any of it, they give it out, you know, bar their charges to the to the clients for some platforms, as you say it's their biggest cash cow. Yeah, strange. Okay, we had our first Twitter thread. I don't know who put that into our agenda, because no one's put the name bytes. I'm throwing it out there.

Andy Hart:

Nobody's gonna be owning it. i referred to

Alan Smith:

it. Yeah, I mean, it's no big, big issue. I got a I got excited for a second but because a gentleman who I don't know by the name of Simon Glendenning, I think who looks like a bass on his profile, a relatively new advisor and A relatively new joiner of the profession, who wrote a Twitter thread I quite like Twitter threads do a few of them myself from time to time. But he was,

Nick Lincoln:

yeah.

Alan Smith:

And the amount of Tumbleweed that I received once a post that no one likes them, I enjoy them. But the yes, he just wrote you wrote about I think it will, it was about the episode we had a few episodes ago about sort of advice to new joiners to the profession. And he sort of summarized it all in a in a in a nice and neat and elegant thread. But it was the first time we'd ever received something like this sort of summary of one of the trap episodes from a practitioner. So yeah, it was nice. It was good. That was it. Nice.

Nick Lincoln:

Ya know? Nice, nice. Yeah, I read it. It was good. Is it? Well, he knows kind of shows that we were doing something right, I think. Okay, the next item, Carl, I'll you can just, yes, you talk as much as you feel comfortable talking about it.

Carl Widger:

Sorry, Nick. What's the next

Alan Smith:

NBO Bye. Oh, yeah. So

Carl Widger:

I had my mic. My mic was viewed as I was offered a word to buy on. Yeah. So we announced the betters

Alan Smith:

attention.

Carl Widger:

We have concluded an MBO. So Metis. Ireland is now entirely owned by Chairman. Week for the Irish, a very good week. So yeah, look, anyone who's been through these kinds of things, understand and appreciate how long that they actually take in the background. So I've been working on this one for a while, sort of just really exciting times. And yeah, we can, you know, we're very excited for what the future brings. So all systems go at Metis.

Andy Hart:

Congratulations. Explain what remedy I don't understand that term call.

Carl Widger:

A man management buyout. So what we did was the company bought back some shares, and then individuals bought some shares, so and all of the individuals who bought shares are involved in the company. Brilliant. Very good.

Nick Lincoln:

Very good. Okay. And the next thing on the topical tidbits that you can't see, Carl, so is your point stock market volatility. Banks in bother stick with the plan, the best time to invest was 10 years ago, the next best time is today for long term investors.

Carl Widger:

Yeah, I just I just thought it would be remiss of us, it would be remiss of us to not mention the stock market volatility we did mention the last time as the SVB, which I always have difficulty pronouncing. And and Credit Suisse had their own issues. And it seems like there's a couple of others having a few problems as well. And whether it's linked to interest rate rises, or whatever. It is what it is. And for me, it just seems like, oh, there's a problem. And stock markets have a temporary decline. And then oh, there's a rescue package of some description. And then stock markets seem to bounce back pretty quickly. So there's a lot of volatility out there. And I don't know about you guys, but we have several people who are kind of sitting on the fence and, you know, going, I don't know, is a good time to invest. What if this turns into the financial crisis and all that kind of stuff? So it's, it's incumbent on us to, you know, just talk them through that whole process that, yeah, the best time to invest was 10 years ago, and the next best time is right now. So

Nick Lincoln:

with those clients call the clients that are waiting on the sidelines, and they don't want to invest because of today's catastrophe of catastrophes. Do you ever do the drip feed thing with them? So you know, so they got to six on the ground will invest 100 grand over the next six months? Do you ever adopt that philosophy? Or try to?

Carl Widger:

Yeah, so I have a real case right now, where the guy is, the guy and the girl, the couple are sitting on money, and they've decided that they're going to average their price over the next 12 months, probably in quarterly payments as opposed to monetary. Like we all know that the maths don't support that. However, I think equally as important as the maths is human behavior and making somebody uncomfortable. And you know, especially for clients who are new to your financial planning firm. You know, it is so important that they get comfortable with the whole process at the outset. And we've just gone through the whole financial planning. They've totally and utterly bought into it. Very, very clever people. And I've just told them, This is absolutely 100% relevant and okay to do. So. Yeah. Yeah.

Alan Smith:

I'll just make a couple of points on this. Because this whole aspect of phasing it's so it's an interesting one, and I completely buy into the psychological benefit if indispensable The money is currently if it's if it's in cash, particularly when when I've worked in the past with business owners who have exited, they've got a chunk of cash that they've worked 25 years to create, the psychological challenge of investing there and seeing a temporary decline of 25% in rapid audit is not one that anyone wants to experience. So phasing becomes appropriate and relevant. We did a piece of work a few years ago now, but it still stands up to scrutiny, which is to say, just looking at the maths, the phasing from cash doesn't really work. And phasing over six or 12 months doesn't really work doesn't really achieve your objectives. If you're going to phase you got to phase through the risk portfolios, like from your, let's say, in our terms, our 20% equity portfolio, and then phase through 40 6080 100, or whatever, you're going to end up towards number one, so you are invested somewhat. And doing over 12 months, again, look, looking, looking at 100 years of data doing over 12 months doesn't really give you a lot of benefit. You've got to be doing over three years, if you really want to benefit. And this is just a statistical analysis of historical returns. Had you ever done that through the best and worst periods? I think I can share some of that that research we had done.

Carl Widger:

Yeah, I like just to just go back on that island. Like I get that the maths don't work. But at the same time, what you've just described there, to me sounds a little bit complex for somebody who's entering into the whole financial planning process for the first time. Really, that's just me, though, but

Alan Smith:

just just we're gonna face you over 36 months, we're gonna shape shapes face you from

Carl Widger:

through different equity portfolios. I I just don't know for someone who is nervous about equities anyway.

Alan Smith:

Are you facing from cash to sticky in cash and then drip feeding over 12 months? Yeah. Yeah. All right. Again. So psychologically, that's probably satisfactory mathematically and sub optimal. Yeah, no,

Unknown:

Andy. Yeah,

Andy Hart:

I did cover this in a podcast I did on Maven money called invest by sunset. Hopefully, I've dispelled this whole concept, but it's worth checking out. If you're an advisor. It will certainly arm you if you're gonna do it with clients, just back to Karl's point. And I'm sure he's done it, if you are phasing it in needs to be agreed on day one, what percentages are going in? And on what days? Because otherwise, it will be market timing, which dictates so if you are going to do 20%, today, 20%, in 90 days time or 91, that you know, the phasing strategy needs to be agreed at the outset. Otherwise, you're just relying on market timing, which is a mess you don't want to be in.

Alan Smith:

But yeah, I see what you're saying is sensitive markets. See markets fell? Do we had one of those things? March 2020, or whatever markets fell? 20% 30% Yep,

Andy Hart:

you still gotta go ahead. You still invest it intellectually great time to invest? Intellectually, it's a bad strategy, we know that the markets generally going up 75% of the time. Yeah. And going down 25% of time. So you deploy your money by sunset, if you don't want to do that, because you're not a financial robot and you're a human, then we need to employ human strategy. That's when you discuss what percentages are we doing? In what days, if we agree on the outset, I can facilitate that I'm pandering to you, but I can facilitate that. If you're gonna say to me, I'm gonna do 20% today and see where we go. That's a complete disaster. So I'm happy. I've never actually faced it. I've always taught the client off, just investigate now. And then holding their hand and going through all the things and it could there could be a temporary cut, etc, etc. We've all been there something we've dealt with, before our entire career. I mean, you just get

Carl Widger:

I agree with. Yeah, I agree with everything you've said. It can come across as a bit salesy, right, we're talking here to financial advisors, it can come across a little bit pushy. If you're saying to people, you know, oh, I think you know, you should you should go out, it's the

Unknown:

right thing to do trying to find

Carl Widger:

the sweet spot. Yeah, I appreciate it. Also, the right thing to do is to invest on 100% in equities, and I don't, I'm perfectly okay with people adding bonds to the portfolios, too. So I'm trying to find a sweet spot between getting people across the line and invested over the long term and doing the exact right thing all the time and psychology, human psychology comes into it. And I of course, refer to that rather than the mats.

Andy Hart:

But that's why I'd start off I've had one client who, you know, if you're a financial robot, this is what you would do. You're not a financial robot, you're humans, you're going to try and find some sub optimal solution, you know, at least have that conversation with them. But yeah, cool. Over to you, Nick.

Nick Lincoln:

I, I had one client, one client, I think in my career as a financial planner, who's phased and he phased a couple of years ago, million quid into one fund. And he did phase 250 grand a time but as you said it it wasn't an agreed schedule. So we didn't, we didn't. I said, Okay, what I'm doing on these dates, okay. Yeah, that's when it's deployed and you just find sail through we didn't, yeah, you didn't look at any extraneous conditions what was happening in the markets on those days. It's just this is women. And we did it and he was happy doing it and I think I think the end of the day we know that people are better served by being invested in the great companies and how they get there in the scheme of thing doesn't really matter No, I don't think it does. It's just that let's get let's manage their behaviors though they're human beings they got emotions, if it makes them feel comfortable with raising fine and do it over whatever period you think it's best for that particular person would be my my summary on that. Okay, well, good topical tidbits there we've a lot to cover obviously for the UK advisors the the pension stuff is what was it was massive I think if you're if you're okay with the gents we'll move on to the meat and meat and potatoes. I can see behind me the trap back back of house team are busy busy peeling the spuds. So let's let's move on to a different sound but this time I've got rid of that liquid. He's just now.

Alan Smith:

Meat potatoes you've been used to eating but that was not a good drop last week last time now as

Nick Lincoln:

someone weighing into a bowl of meat potatoes, which is that's not that's not that's not the vibe we're going for. Okay, so the meat potatoes of this episode.

Carl Widger:

Just just to say this. This one is also terrible. But anyway. Really?

Alan Smith:

What is the sourdough can be an potato? I mean, what is that sound?

Nick Lincoln:

Well, it's gonna be sloppy, isn't it? Anyway?

Carl Widger:

What does it even mean?

Alan Smith:

college should mean the main content.

Nick Lincoln:

If you know if you know a good source Trappists for food sound drops, send them in. Okay, set them in and I shall listen to them. I've tried. I've tried. I've been on every rabbit hole trying to find decent food noises anyway, the meat and potatoes that we will get there of this Episode Episode 16 is kiss keep it simple, stupid. As a profession on the both professional side and on the manufacturing slash industrial side. We have a terrible tendency to overcomplicate and it's the bane of what we it's one of the worst things in financial services. Mr. Hart you raise this this subject I know it's a it's something dear and close to your what heart you have. And you lead off young man?

Andy Hart:

Well, I'm sure a lot of advisers listen to this. I got straddle a straddle this area of should they be doing more should they be. So I believe the results of working with a great financial planner are sort of two things. We're either removing financial anxiety for our clients, or we're promoting great financial behavior. The rest is plumbing and admin and noise. So they're the two sort of results. We're trying to remove or reduce financial anxiety for our clients and promote great financial behavior. What I see is too many financial advisors, overcomplicated for profit, certainly on the investment side, incredibly convoluted investment solutions shedload of funds, nothing makes sense. But on paper, it looks complicated. Therefore, it must be good. So they also have a lot of strategies that they employ, that a temporary strategies based on rules are likely to change. So then they set up these very expensive strategy structures, clients haven't got a clue what they are, they seem to sound enticing, and they're gonna save either tax, or they're gonna get some additional return. And then five years down the line, the rules change, and they're back at square one. And they've got to now reset up another complicated strategy. Also, financial advisors say, I've got complex clients, and I think, well, if I got complex clients, where my clients become less complex with the work that I've done with them, or am I just on top of all of their complexity, so therefore, it seems like they're quite simple clients. For me. I think the idea is to simplify people's finances over time, I say to clients, it's gonna take, you know, two or three years to get your full financial house in order. There's about 40 things we need to do, but I'm not going to do 40 things in month one, I'm going to do the ones that you know, low hanging fruit, getting the big stuff done. And then over time, we're going to tweak and get your financial house in order. So yeah, I see overcomplicating for lots of financial advisors, complex strategies over complicated investment solutions. And if there's any advisors out there that think, should they be doing more Our job is to protect our clients from this complexity. And there's always a flavor of the month that comes in the old vibe a lot of advisors jump on and I think hold up is this going to be good for my clients long term because it's going to be a phase thing that I'm trying to protect my clients from? You know, we do things here that have always worked anything which is working now we try and avoid So yeah, that's the intro into this section who's up next?

Nick Lincoln:

I think so Mr. Smith, because I mean, one of the one of the areas of the of the world that we were in this, this this this thing of ours, obviously are investments and investment funds. And if you want to find an area that is overcomplicated for its own sake, it's it's it's areas of the investment fund management, business and the advisors who use those funds. Mr. Smith, what do you what do you think about that?

Alan Smith:

I agree wholeheartedly. This is going to be one of our sessions where we all are in violent agreement with each other. I think I don't think anyone is Sam is going to dispute this because Give it time.

Unknown:

I'm sure we'll find,

Alan Smith:

yes, we have obviously we give, we do financial planning, and we recommend investments. And the world of investments is wide and complex. It's in the UK alone, it's a 7 trillion pound industry. And oh boy, are the people and organizations who try to make things complicated and esoteric and weird. But it seems that the kind of almost like the in a lot of things in life, the wealthier you are, the more complex things are. So you go to you eat sort of, you go to fancy restaurants and you buy more expensive complex watches and all that sort of stuff. So and the sort of financial services world likes to replicate that. And I'll tell you a brief story about why a few years ago colleagues of mine,

Unknown:

grab yourself a drink a very long drink. It's Storytime with Ellen Smith.

Alan Smith:

There we go, boys. So we probably all the same as us. You get promotions, you get sent emails, you get phone calls, you get the from various fund groups. And finally, you have a laugh about this because yeah, we got I mean, I'm old enough. We've been in business long enough to remember companies like ours crew. Key data, you remember them, but they were they had promotions, they had road shows, people attended them. Film partnerships. That's another one. We film partnerships. I never really understood how the whole thing worked. I had I went to a few because everyone was it was all the rage and everyone was talking about and I felt I'll be must be missing out. And somebody explained it to me and I said, Oh, I don't really understand that. Can you? Can you tell me again somebody told me about three times I thought I didn't really get it because you had to get a check. You took out a loan and you bought some stuff, you got some tax break, it all seemed a bit convoluted and unnecessary. So we never went near them. But the funny thing was we kept getting these you know, emails and introductions to road shows and things and so colleagues tonight we ran a little competition to find the most the weirdest the most esoteric fund opportunity that we were it was being suggested we would refer to our clients. Now things like an obvious one was fine wine as far as it sets up you can invest in wine Yeah, alright real thing. That was one that you can invest in stamps you know people buy your penny blacks and whatever. So there's an actual proper fund that was set up to invest in stamps. There was a commodity fund that we were that was heavily promoted a few years ago. And I mean we just had a laugh at that because you invest you look at the sort of sub holdings timber was one get this lean hog Lee lean hog was a subset of the larger investor you want to

Nick Lincoln:

go to you want to go long on fat hog who goes on lean hog then that

Alan Smith:

is pork futures pork futures are investing in but it was it was raising a lot of money. There was one that which was a bloodstock fund so you're you're investing in racehorses and and looking at prize money from racing or absolute true story that you can invest in the Fund and you could record any of us could have recommended them to clients. But the winner of the competition that we ran we ran it over we really ran it for about six weeks to see what sort of crazy stuff we would see because we normally just press delete the European attention to we thought no we're gonna pay attention to see what's out there. And the winner of the competition was a ship wreck fund a shipwreck that's what I was gonna say

Andy Hart:

100% True story. I know people invested in it I've seen shipwreck Fund is a is obesity no way really. Yeah.

Alan Smith:

Raising raising capital investing in a in I don't know the equipment you need to send people out deep sea diving to find these buried treasure from all sort of sunk in Spanish galleons. I mean, seriously, and people The point being you think that's a joke. Regulated advisers were recommending it because they thought we need to diversify. Why invest in the great companies of the world we can invest in a shipwreck fund and some blood stocks and fine wine.

Nick Lincoln:

Normally, people don't do things in plain sight but if they're calling it a shipwreck fund, they're telling you it's going to be a shipwreck

Alan Smith:

on trees when aid

Unknown:

off yeah,

Nick Lincoln:

made up Yeah. Where's Bernie? Well, he's made off with your Money Gram call. you simplify your investment process properly to the absolute as pure and as claims that can be till the dear TRAPPIST what your investment processes and why so?

Carl Widger:

So in? The Irish market is a little bit different. I've explained this before that not everybody. In fact, very few firms are using platforms. So number one, we decided right for the vast majority where we possibly can. We're going to invest in the platform and then in that platform and 95% of the investments with our clients are in either the dimensional world allocation funds or the Vanguard life strategies. And that's as simple as we keep it and it can't get any simpler. And for us all the added value is really in the financial planning and managing the taxes where we can and keeping up with the legislation and making sure people are living the life that they want to live, it's the added value is not in the investment. And so I was kind of having to think about this. So like, it's incumbent on us really, isn't it to try and keep it as simple as we possibly can. So that kind of trends translates into how we run our business as well. And maybe there's another episode in, you know, how we kind of run our firms and all that kind of stuff and run teams. But we've mentioned the pod structures before. And, you know, that's about keeping it really, really simple and not having loads of layers and stuff and making sure that we have kind of just three people wrapped around every single client and keeping that simple. Having your systems and processes written down. You know, this is from the financial planning firm point of view, to make sure that every client gets the same every single time. And that precludes you from investing or being tempted ever to invest in a shipwreck Fund, which I've never heard of. And that is just bloody mad. But as I see you here in Ireland the last 10 years, or maybe even more low notes, I don't know if you've you guys have notes over there. Yeah, there was a firm actually front of yesterday's paper was closed down because they had a, it was a financial planning firm, not closed down, they were suspended from trading for a year, but Central Bank, because they're associated firms that had the similar directors, were running a low note firm, and the financial planning or financial advisory firm was promoting them these to their clients. And it's been shut down. So there is kind of good stuff in terms of regulation coming down the road about what's allowed to be regulated and what's not, the thing that just doesn't sit well with me is unregulated investments can still be sold by financial advisory firms, they just have to whip out they're regulated by the central bank at the bottom of their, of their head of paper. At least that's what it used to be. I'm assuming it still is now. So why can't we just get rid of these things? And you know, if you're a regulated firm, you cannot sell unregulated investments is surely it's a pretty straightforward and easy scenario. So simple. So simple. You know, it's, it's, yeah,

Alan Smith:

can I choose? I wanted to, and you would find something to disagree with? Call your one fund solution. So that let me just so do what you say life strategy or the dimensional version. So you mentioned word allocation Well, right. So that's a packet. So you can't then and correct me if I'm wrong, and I've got this wrong, but you can't then sort of pick apart the components of that. So in other words, let's just say so 6040, and 8020. Right, so that that would cause us some difficulty, we do do some strategic planning around the asset allocation of if we are doing a rebalance, or we need to manage CGT, or we need to just take some money out of the portfolio, there's the particular time with that we wouldn't want to take across all asset classes within we want to be a little bit more specific and unpack the component parts. So that probably wouldn't really work for us as one packaged fund elite Elite gives you less opportunity to do some some, some smart planning, in my in my opinion.

Carl Widger:

Well, so my comeback on that is as follows. Right? So if you're invested in a platform, and you have your the vast majority of your money in, for example, the dimensional world allocation funds, we can drill down into that I don't think that's what you meant, but we can drill down into you know, those 10 and a half 1000 stocks and and does 800 bond holdings, etc. But I don't think that was your point. I think your point is, how do we take money out? So for us? It's yeah, so So that's about your financial planning. Right. And that's about your ATMs what your clients every year to identify over the coming few years, what kind of cash we need. And I think I'm blue in the face of saying this a lot of the, the added value is too, so. So we all have clients who have who have high net worth, right. And the strategies for them about withdrawal is about taking the right amounts of money out of the right pots at the right time. So we can always identify what's coming. And you can identify that a couple of years out and tax on investments is a little bit different here than it is over there. Right? But tax on investments is a good thing, because that means the investments are going up. So at some stage down the line, you're going to have to pay the The tax. And if you can identify, you know, a year or two or three in advance, well, that allows you to, you know, be clever about where you take the money from what parts you take the money from. So I'm very comfortable with that. The alternative, of course, is that you leave money in cash for drawdowns, I don't believe that that's in the long term, that that's a good strategy. However, for the next couple of years, we'll always have our clients who are just sitting on money in their bank account, which is their expenses for the next couple of years. So that's how we kind of get around that. There are other more complex ways of doing it. But for me, it is, I do believe that our investment strategies and our financial planning process are as simple as we can possibly make them. And, for example, our financial planning presentations are like one act, please. Everybody in the room knows what they're doing. And every single client emeritus gets the same screams at the same time during all the meetings.

Andy Hart:

And drills, I think financial advisors also think financial advisors think is their job to share with clients, like how complicated this business is, was I sort of tee them up and say, Look, do you want to know the sort of boring detail behind this? Or do you want me to just get on with this? Or at least ask them the question. Whereas I think a lot of advisors think clients want to hear all of this complexity and how they've got to this solution. Whereas I'm a bit more like high level clients. And you know, I've done all the thinking, there's a lot of admin in the background, there's loads of plumbing I need to do, the outcome is, you know, X Y, Zed. Do you want to know any more? And they often say, No, not really, I'm just getting with it. Anything I need to do now is anything it's actually no. So yeah, I'm a massive fan of shrinking your circle of competence as an advisor over time. And you're not not missing anything out for the client for the sake of not wanting to do it. But thinking long and hard. Do I need to introduce this to this client's life? Yeah, I have to call.

Carl Widger:

Yeah, I just wanted to say a real life situation we had was last Friday. So new clients sold his business. So met with the client and his wife who's very successful in her own right, myself, and Mary Carney, one of our financial planners met with him, went through the financial plan. And I would say the meeting lasted an hour and 35 minutes, let's say, definitely, the financial planning piece came first. And it lasted an hour and 50 minutes. And on our investment, pitch our education piece, whatever you want to call it is three slides. And that's all it is. Number one is the wall of worry under that you've given us. Number two is at the moment, we have a piece about what your stock markets tend to do after 20% decline. And then the last one is the page lifted from the dimensional world allocation book. And what we focus on there is our three numbers, right? Number one ought to do last year. So let's all just be straight up about that. Number two, what's the long term average return and number three, what's the lowest one year return? So there's, if you're all familiar with this page, there's tons and tons of numbers on it, we highlight those three numbers. So we're looking for, you know, people who are comfortable with the 6041, for example, was I think the worst one year decline, temporary decline was 24.9%, or something like that. Whereas the long term average return is in excess of 7%. So, we're not saying we're going to be guaranteeing anything who knows what's going to happen next, but this is what the history tells us. And we certainly are not bringing any bloody low notes or shipwreck funds or any of that crap. And I'm very, very comfortable with this. And this is what I would invest in myself, if I had the type of money that those clients had, you know, and that's, that's absolutely, um,

Alan Smith:

you know, we've what we've had the right thing we've had, can you talk about someone who's sold their business now, and we've got quite a few clients that that and what they get, they often will get an urn out. So they get a lump of money sort of day one on completion. And then of the next 234, up to five years or so they get further funds. And what regularly happens is so we set everything up, as you'd expect at our sensible low cost portfolios. And then they come back to zero have another chunk of money couple of years later, what should we do with this? And we say, we'll do the same, at least what have you got anything else? Yeah. You have that client? Surely there must be something? Well, yes, there's a million other things including shipwreck funds and bloodstock funds, but we're going to protect you from that. I often taught I mean, some of it some of us on this call are old enough to remember the advert for John West things John West tuna or something and it was the John West is best is to fish that John West rejects and I say most of our life is spent protecting you and rejecting 99.9% everything Yeah, that's yes, but there's surely there is something else we can

Andy Hart:

do. The stuff that you'd love for me to sell to you. Yeah, they would like you to put together

Alan Smith:

something really exciting and interesting. But I'm not going to use all the things.

Andy Hart:

Yeah, they don't invest in the same thing at portfolio. Now we've got these 12 ideas, you're ready for it, right? We've got the shipwreck fund, we've got the forestry fund, we've got the crypto fund they're loving it absolutely loving it sitting there in a chair. Yeah, we protect you from that because that's what you're paying me for.

Alan Smith:

But But back to the idea of dealing with human beings. It's, it's the is what we call dinner party conversation, cocktail party conversation, you can talk to your friends about crypto investing forestry investment, my God, you could talk to him about shipwreck investing, or after you'd entertain our funds, our investments are boring. It's not it's been

Andy Hart:

a pleasure in the shipwrecks here that they're going for the treasure in the ship. Yes, treasure investing really what you want to pitch it correctly. Maybe that's

Alan Smith:

treasuries. Just want one other brief point I'd like to make on this subject is, I see a lot of activity with advisors recommended for those now that cash rates are higher than you were a little while ago. And investing and I'm not gonna name any names, but these kind of platforms that you can invest in, you can put money in, it's not invested just putting money in cash and diversifying them across a bunch of different banks, building societies or whatever, rather than because everyone is concerned about in the UK, we have this financial services, compensation scheme limits, I think that's what it is. But it was 85,000 pounds last time I looked. So if the bank went bust, you're protected to the tune of 85,000, anyone with more than 85,000 will spread them across. And rather than having 27 different bank accounts, you can put them on a platform, to me that it's what you call a symmetric risk in as much as the upside is minimal. Because in terms of where you might put your money, because we are a standard default. And again, I'll go back to people who've got large sums of money and for various reasons that keeping it in cash, usually temporarily. In the UK, National Savings and Investments NS and I currently pays a think something like 3% For Instant Access money, and a bit more if you want to tie it up for a year 4%. And yes, you can get a tweet a tiny bit more elsewhere. But the the upside, the upside is marginal. And the downside is catastrophic. Because who knows? The amount of things have happened over the years, the things it's never happened before, which have happened. I don't I just don't see the benefit of using these but you know, I know a lot of advisors do a lot advisors support them heavily.

Andy Hart:

NSCI for a couple can put millions away, LNS, nicety and SSI elegant simplicity in all of its form. It's a wonderful solution. And when you tell it to like lawyers and people that looking after they're like, really, I can just do that and like, yes, all of your, you know, all of your stress has been answered by that one solution. And

Alan Smith:

if you mean it's not well known.

Unknown:

Yeah, I don't even know about Eddie. even know about it. Yeah.

Alan Smith:

And he said, Lord knows.

Nick Lincoln:

Yeah, culture, you and I get a room and come back in in half an hour

Andy Hart:

tourney capacity. That's it. Yeah. A lot. professionals don't know about. Okay,

Alan Smith:

what do you think about Nick? Would you agree, Nick?

Nick Lincoln:

Oh, am I being asked? Well, I think Oh, that's nice. Okay, I think thank you for that seamless. Wow. Yeah, this is the bane of my life. Yeah, come on. I certainly have and I'm gonna rattle through. I think I think this aggravates me as much as aggravate Sandy, this this this over complication, I know aggravates all of us, actually. Roger Edwards, who was the ex Marketing Director of Scottish provident and then bright Gray, he, he's kind of made his career from just his messages, simplifying everything down. And he put a tweet out the other day saying, in response, something like without their heart, we live in a world so complex that people are suspicious of something simple, but simple is so much harder to do than complex, which is why so many things are complex in the first place. And I know there are loads of quotes out there and I mean, how about Allen Stein said everything that is attributed to him. Can't be But Einstein once said, The smart people simplify things. He also said if you can't explain something, simply you don't understand it well enough. And our profession from the advisory side and the manufacturing side is absolutely riddled with complication with people who just want to take something simple and make it into a bloody quagmire of of over complication for its own sake. And, you know, I know some advisors who just seem compelled to make work for themselves to no end. And it drives me scatty. It's, I mean, I put together Adobe is a very good example of overcome Adobe is a well known brand name, right? We all use Adobe in one form or another might be as simple as just the the free PDF reader. But their products are over engineered to the nth degree and it's just like, I cannot be asked with this. I'm gonna go and use DocuSign it's just easier. There's one example. I put it I put a loom video together. For the for the peer group that myself and Andy and Alan belong to a loon video 10 minutes of my exact workflow around of the pre annual planning meeting, the actual planning meeting itself and the post annual planning, meeting all the software applications and bits and bobs that I use. And it's scalable, it's repeatable. And it's simple. And yet all these back office systems that exist these clunky awful things I don't think you need to use, I think we've been raised on back office systems, they're like oxygen to us, we think we can't do without them. It's a safety blanket. They're rubbish. They're overpriced, that really poorly written, you get lousy support. And they make it almost impossible to extract your data later on, which I think is an absolute, it's a it's a bloody disgrace. We could simplify so much. In terms of the tech we use, but but the message to our clients is, you know, again, begin with the end in mind, right? You have one question to answer for your clients, the clients want to know are we going to be alright, that's all they care about, okay. And your job is to show them the path to financial salvation. And for most clients, it's going to be a DIA, a personal pension, and an ICER. That's all they need. There aren't complicated clients, there are complicated advisors. You one and 100 clients might have a complicated situation, which means you have to write 55 trusts or some other crud, right. Okay, that's my, and I know this is an echo chamber today. But if I if I get hit by a bus today, which is actually lovely penalties, not not in the country, so I'm probably safe for the next few days. That's my message to everybody listen to this. Just simplify, simplify, simplify and don't get caught in their mind. Andrew,

Andy Hart:

while I'm on it, another bugbear of mine, quarterly meetings now shoot me shoot me. quarterly meetings. I mean, what do you discuss every quarter with your clients? It just gonna turn into a performance conversation surely, by annually, okay, every six months, if for some reason, in the early stages, that's what you wanted, then great. Obviously, if there's anything specific that the client needs to go through, I'm available for meetings. So unlimited meetings, once you become a client, but having set quarterly meetings for clients, I know it's not that common. And again, people think well, they've got more money that I need, I need to see them more now. The more and more money I pay my accounts and less communication. I like the guy

Alan Smith:

you know, the the traditional kind of three tier service model, let's call it gold. So Oh,

Andy Hart:

yeah. Gold, silver, bronze, my gold clients every month shoot me?

Alan Smith:

Well, that yeah, that is that would know that the gold clients would generally quarterly silver half yearly and bronze once a year. And I think if you are building your service proposition on the frequency of meetings, you're doing it the wrong way around. I've had I've had wealthy clients say to me, Well, I had one guy said when we set up and we just organized everything. I said, How often do you want to meet? He said Never. He said it's nothing personal. Nothing personal. He said, Yeah, he said, Because he said I'm busy. If you're running everything he said why is classics other statement? He said, Why hired? Why hire a dog and bark yourself? I trust you get on with it. Call me when you need to speak to me. Now. We defaulted to an annual. But I think I think it was right. And if you're building a service proposition based on the frequency, because you've got to have probably your wealthier clients are just busier whether they are still working or if they're retire the property traveling and doing some fun stuff. They will be dragged into a 90 day update meeting.

Nick Lincoln:

I'm actually changing my service Stan, I'm going to once a decade is my meeting. That's my standard template. For some of you apply. There's too much but I'm available every second year for a five minute phone call. Okay, because I don't want to be me. Okay. I think we have done this immense justice if we're okay with that, guys. We're at 54 minutes in somehow. I think

Carl Widger:

I suggest Nick we might go to the questions and culture corner, bearing in mind we are 50 odd minutes and I think

Nick Lincoln:

Carl is like you saw into my pee shaped mind and you took the words out of my mouth because I can see at the corner of my eye. That post is at the front door. He doesn't TRAPPIST questions this is where the this is where the listeners get to ask us the traps get to ask us questions and we try and answer them directly and honestly and with plain English and you can submit your questions via Twitter at advisor podcast in the pinned tweet or in the so called show notes. There is a link to click on the form to submit your questions. So let's have a look and see who's in the sacrificed envelopes being opened Colin Bates who is not on Twitter but is on LinkedIn. It's a long way also the LinkedIn address had gone forever. Colin asked what is your view on paying Rs is a good one. Usually what is your view on paying professional connections or referral fee? Any success slash horror stories with this approach? Would you consider paying clients for a referral? Well, I'll have first dibs while the three of you collect what love known as thoughts. I wouldn't ever pay a professional connection or referral fee. I think it sets the wrong tone. And I wouldn't also get into partnership with a with a professional connection, who expected reciprocal stuff back unless you thought they were decent people, I wouldn't do it. And I wouldn't pay clients for referral. What I have done occasionally in the past is reward client or give clients a gift that they weren't expecting for referring me to a client. And I do that on an ad hoc basis, depending on what kts of the referral was. So that's nice. It's not expected. That's my that's my tuppence on that gents who wants to comment on that? If and

Unknown:

I'll go next. Short answer. Go and call.

Nick Lincoln:

Okay. Well done. Boys. Neither of you raised your hand. You both spoke. Andy, Andy then call?

Andy Hart:

Okay. So this is quite a deep subject. I know it a little bit. I mean, I've dabbled in this over the years. I mean, I have when I was a mortgage broker I paid for leads from money supermarket in the likes of I've had various commercial arrangements with lawyers, insurance brokers over the years at various different firms. Yeah, now I'm sort of at the point where I wouldn't pay a referral fee. But if you were building your business, and it was a bit more of a set commercial arrangement, again, I don't know what the compliance or regulatory angle on this is. I know Colin's relatively new in this business who's probably looking at it. Yeah, I'm similar to Nick, if someone refers me a client, I would send them a Fortnum. And Mason sort of baskets or thank you or something like that. So yeah, it's not any sort of monetary exchange. It's just a gift exchange. But that's, but I'm sure there are successful ways to do this. But again, as I don't have enough information, or haven't done it personally, so hopefully, one of these guys have over to car.

Carl Widger:

Yeah, full disclosure, when I set out on my journey on my own, I used to pay or offer to pay, and it was not successful. And we got a lot of referrals now from tax advisor solicitors. And we don't pay anybody but I suppose what we try and do is make them look really, really good. And I think we deliver a great service. And that's it. I think it's It's immense our relationship with the clients and the tax advisors, solicitors, and it works really, really well. But yeah, no, we don't,

Nick Lincoln:

that's, that's the big payoff. That's the big reward you give to her and introducers, that you do a fantastic job and it enhances their brand. That's that's the perfect Alan and,

Alan Smith:

yep. going against the grain, we have made a success of this. So depending upon who the professional relationship is, with, I don't think in our, in my experience anyway, traditional I mean, lawyers forget about it, and they've got issues anyway, so have accounted for think about receiving, you know, fees or income useful, or shares of income. But there are some professional organizations who are just very entrepreneurial. And to use a phrase, if you create the economic glue, it helps it helps with with certain companies. So we have made a success with what generically called Corporate Finance boutiques, so the very organizations that help sell companies, that's their whole thing, they build it, they create a company, they take a company to the market, if you like, and they sell them. And I just happen to historically know, I was introduced to a few different firms. And I would say to them, well, these entrepreneurs, you're helping build a business and sell their business. I said, what do they do once a bank these millions of pounds? And the answer was, I don't know, I don't care. I'm on to the next deal, I guess, to go and speak to their bank. And I said, Well, how would it be if you were to refer them to us, and we do a full job, we do a comprehensive financial planning, we do all this extra work. And they said, Yeah, that would seem reasonable. And so we created and we've got several of them now, partnerships. And full disclosure, we share 50% of year one revenue. I'm playing the long game, I'm all about building recurring revenue, and I'm happy to share, you know, the year one startup costs, or the other fees that we charge. And I don't know if we would have if we didn't get if we hadn't have done this, we'd be still I don't think we'd have got the business because some of these fees are substantial. You know, the the monies involved are pretty big. If you start a business and a lot of these corporate finance teams, they can't deal with clients, but you know, less than five to 10 to 15 20 million because they're working on a transactional fee. So it's very important and I think it helps them with your opinion. If they're getting for effectively straight to the bottom line. They're getting a fee share. We don't charge anything extra. The client is entirely neutral for the clients viewpoint. And they're receiving and some of her to this day some of our very biggest clients have come through that route and just works quite nicely. So it can work. But you've got to be selected. And you've got to know the people in the organization. And one last thing I'll throw in about referrals from clients, I agree with everything you said, you don't pay for them, but you know, it's nice and send them a nice bottle of wine or as you say, a gift hamper or something just to acknowledge it. What we've always tried to do is when a, when we get a referral from a client, and we've taken them up, you know, taken through the whole onboarding process. And if set up as a client, and we have this welcome meeting, which we refer to in the past, we say to that client, would you be so good as to go back to the original source member, Bob, who introduced us? Could you come back and just say, you know, that you're pleased with the outcome, you're very pleased with the referral and introduction, because again, being uniquely human, the person that's referred wants to know that it's worked out well. And it's quite nice if that person is very, hopefully, he's very happy with having been referred, they go back and say, by the way, Bob, thanks so much. Thanks for introducing us to Capitol. It's worked really well. We love it. And I'm very pleased with the outcome. And I think that intelligence encourages people to do that again, and it kind of completes the circle. That's okay. Capitol

Unknown:

gray will definitely

Nick Lincoln:

carlman Andy,

Carl Widger:

just a very quick one. This is why I love this podcast. Orlando is a fantastic idea. But the corporate finance houses, no to all my metals colleagues will be doing.

Unknown:

You go oh, you've given him enough to pay an idea.

Alan Smith:

And another idea that he likes to cute on.

Nick Lincoln:

I will, Chief Cloner and they shoot next week for the update. Yeah. Yeah. We're done. We're done. We're done. We're done on that one. Let's have a look at the next envelope in front of me. This is from Matt Aitchison, and I think it's a repeat question which is fine. One of our more keen TRAPPIST on Twitter as at Matt underscore Aitchison. I think we can ask this one quickly and move on because we kind of hammered into the ground like a tent peg over various episodes, CRM systems, a general discussion around CRMs back office systems industry versus generic EG, or the big name players like IO worth it? Or does the simple generic CRM provide what's needed? What's good? What's not? What do you all use? What would you use? That's about 17? questions in there? Max? don't submit the question for at least three years. I know. The general is back office systems are rubbish. Don't use them. Look at my loom video. Thank me later with a beer. Anyone else got anything to add quickly?

Unknown:

I'm Yeah,

Alan Smith:

I think I think that works. Yeah, listen, that that works for solo advisors. I agree with you, you don't need a IO or anything that Yeah, sort of, you don't need anything else, I don't believe because you've got different. We do. We I mean, we spend, I wouldn't want, I wouldn't like to save it as 10s of 1000s of pounds per year for our CRM back office system. And trust me, I would get rid of it in a heartbeat and save the cost if we didn't have to. But there are certain functions that are performed. And it's mainly around workflow when you've got different people in teams do providing different activities and different roles. And you've got to sort of, and you've got to have a very robust audit trail and know who's doing what, when. So we use it. We also use it's not the best, but it's got a portal. You can store client documents in it, you do secure messaging, which works. We do our Gabriel what they called RMA, our reports and the data we're able to get extract very useful EMI from it that we share as part of our regulatory returns. Valuations fee reconciliation,

Nick Lincoln:

okay, don't worry, everything you get from it, and I know just that stuff.

Andy Hart:

Is everyone asleep? So we so we, we use it. Long story short, big firms need them. big firms need them small firms down. To conclude. It's called reg data now I don't know what an RMA are.

Carl Widger:

I love the acronyms.

Unknown:

What's it called? Reg data now?

Nick Lincoln:

You saw me on isn't it? Right it's the same bloody software though. It's the same interface they just give it different names every few months. Okay, I think we've we haven't crashed that one. We want the culture corner yeah, go on Andy. Speak again.

Andy Hart:

I was gonna say you submit your reg data within about nine seconds of receiving the email, don't you?

Nick Lincoln:

I do submit my reg data because like Yeah, yeah, but I can Yeah, and I use free agents so I got the balance sheet in the tax return in the early hours

Carl Widger:

Guys, guys a guy is still recording the podcast. Okay,

Alan Smith:

come on. Come on. What's

Nick Lincoln:

up? Wow, I must be there's something in the air today. Definitely. Okay, so culture corner. Let's see what we have got. I'll kick off with this one I've just finished. Charlie Ellis his book inside at Vanguard, and we all love Vanguard because its effects essentially boring and boring is pretty good when it comes to investing. Trouble is it makes quite a boring story. Once you get past Jack Bogle who was an absolute miracle of a man, he should have been dead about X number of times had all these heart attacks as well as everything else he did in the business world and saving people billions in phase. But the actual book I found a slog. So I'm sorry, Mr. Ellis, I'm giving your insight Vanguard book a thumbs down Alan Smith the deal maker.

Alan Smith:

Yeah, I mean, I like these programs a bit in the sort of format of the made off one on Netflix, this is one and BBC iPlayer. It's, it's called the dealmaker billion dollar downfall. And this was something about it passed me by I didn't hear about it, considering the size and scale of this a private equity company that raised a billion dollars and more, including from the likes of the Bill Gates Foundation, a lot of other things. Very high profile guy, you know, attended. WhatsApp, pleased to go to Davos, you're one of those people basically, well, allegedly, according to the documentary, because he's under house arrest, I believe is in London under house arrest, fighting extradition to the US. But basically just pocketed about a billion dollars. And it really they go through the whole story. And it is just it's just a fascinating real life story. Another No doubt some people would like to have invested in it. That's a whole other thing, you know, investing in private equity, which there seems to be a gathering momentum for retail clients, and I don't understand it. It's more complexity. So that's what that's worth, you know, an hour an hour of your time, I'm going to do a very brief shout out as well for a book called ravenous by a guy called Henry Dimbleby, who was the founder of Leon, the fast food chain restaurant, son of David Dimbleby, successful entrepreneur. And I just interviewed him on the other leading podcast called bulletproof entrepreneur. So worth checking that out. And it's a great book. It's it's an interesting read, if you're interested in the whole dynamics of the kind of food industry, which has its parallels with investment industry, as well, in terms of its complexity, and its desire for profits are all cost worth checking out. Thank you.

Nick Lincoln:

Yeah, I've had a I've seen a precis of that book. And it's about everything I disagree with. But there we go. That's why we're here. We're at a difference of opinion, Carl.

Carl Widger:

Yeah, there's a very famous case, I won't go into any detail on this. It's going on for 40 years in Ireland called the carry babies. And their last week, there was two people arrested for it. Anyway, it's fairly grim. It is really, really grim. But because it happened when I was brought up, and I wasn't really up to speed on the details, so I went looking for a podcast to kind of bring me up to speed as to what happened. And I listened to it. And by God, it is so awful. And I got all philosophical about thinking about this, that Ireland 40 years ago, which is not that long ago, was just, oh my God, it was a horror show. And, you know, the way there's a lot of people given out of the life that we have now and blah, blah, blah, and in Ireland, or kids won't be able to afford houses, blah, blah, well, Genoa, were in so much of a better place and human endeavor brings us to these great places, and I'm just excited to see what my kids lives will look like because they are in such a much better place than art and if the 1970s and 80s, which was bloody disgraceful. So if you want to read about our listen to a grim story, do listen to that it will fully update you. But the point really is, we're in a great place. We're living the best possible lives we could do, and we should all be excited for the future.

Nick Lincoln:

Love it. Love it. Mr. Hart?

Unknown:

What podcast platform is on call?

Carl Widger:

I don't know the link is in the show notes.

Andy Hart:

Alright, fine. Or something. I didn't know if it's audible as part of our check it notes podcast,

Carl Widger:

I just I Googled, I searched it on the Apple podcast, I think.

Andy Hart:

Fine. Cool. Cool. Cool. I've had mine is another podcast recommendation, minds another podcast recommendation. It's the modern wisdom podcast by Chris. I can't remember his surname Nick might remember. Anyway, it's specific. Williams, the podcast. Smith, Chris Williams. He interviews go Winder Bogle. I'm just I can't get off this guy at the moment. He's got four podcasts on the modern wisdom. The latest one is astronomical kind of what's called like 14 Human Behavior missteps or something. It's got four on the modern wisdom Chris Williams podcast. I've listened to all of them at least two or three times I just can't get off of it. I've asked him to speak at home and he's ignored me, which is quite common, which means you're doing good stuff when where people used to ignore you You might be listening to this if it is.

Nick Lincoln:

That's a story you tell yourself.

Andy Hart:

Yeah, it's so good to go into both if you're into psychology, human behavior, social media, or decision making. virtue signaling is just mind blowing sort of stuff that's in your brain. But he sort of cobbled it together for you. And you're like, right, great. That's what we think for a while, but haven't been able to sort of, concisely communicate that. So yeah, it's fantastic. Can't Get Enough, Nick,

Alan Smith:

drawing throwing a link between all the conversation today and that podcast, which again, you have recommended I've listened to and it is very good. The one about the multiply by zero, anything really avoid anything where there's a multiple yes, you're really smart. And you know, this, that, that can apply to some complexity around investment solutions that so you can have your great planning great, everything great. But if you invest in something which can go to zero, then it's all been a waste of time. Well,

Andy Hart:

I'll try and unpack it out. And you might do a better job of it than me. But this was actually Chris Williams saying this don't do anything in life that multiplies by zero. So for example, I could get up early, which is like a 10. I could eat well, which is like a 50. And then I could bungee jump, which is zero. So whenever there's a zero in the sequence, you should avoid that zero. So be that, as I say, reading lots and then doing some crazy pursuit that is going to basically be zero. So whenever you multiply any numbers by zero, the result is zero. Yeah, so the whole concept of trying to avoid anything in your life that times is by zero. As in going all in you know, we just lost it the treasure, the treasure shipwreck fund or something. Yeah, Alan do want to expand on just lost a

Nick Lincoln:

big swath of our audience, the the bungee jump entrepreneur niche in our audience. They're there, they're livid. Okay. That's great. Well, listen, we're at 71 minutes, Carl is itching to go and watch his national team actually lose at a sport. So I think we should let him loose to go and watch his team and lose at a sport which will bring him down to earth a little bit. There TRAPPIST that is a wrap for this episode. Thank you very much for your precious time and your input into the show as ever, please do leave a six out of five star review on your podcast app of choice, like and subscribe to our YouTube channel which is which is burgeoning. Then we went now only about 800 people away from the 1000 we need to start putting in really annoying adverts until the next time, guys and girls. Take care and we'll see you on the other side of the pie.

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Nick Lincoln

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Alan Smith

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Andy Hart

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Carl Widger

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