Bob Son, Chris Payne discussed on No Payne, No Gain


Eight eight eight that's the word bullish five by five eight eight eight and now we have a very very special guest on the show my brother Bob son and financial adviser pain capital management Chris Payne could have your shows when a brother a brother too good to be here in your right I am special the special quotes I mean we ARE special Chris very special that's right you you translate that how you see fit well Chris this is our spotlight segment and you each week we dissect a real plan to plan to cover the flaws or what we call pain points again spelled P. A. why any so that our listeners can avoid the same mistakes with their planning investing in you worked on a case recently when you break down this case for our listeners and let us know what you did here to get this couple on their path to financial freedom all right sounds good so yeah this is a very interesting cases of all my cases are but this one particular interesting so you know one thing I always try to do I should say always I always do this I always find out first and foremost what each person is trying to accomplish with their money like where their personal financial goals and you know maybe not necessarily financial but you know emotional goals material goals yes Sir right up front I was one understand what's driving all this and for this particular person their biggest concerns with that they want to reduce risk they wanted to reduce the amount of taxes they're paying and then finally they wanted to start managing the portfolio on their own so the first thing I said as well you know why you want to reduce risk why is that important what does that mean to you and they said well I think right now my portfolios very risky you know I've done really well the last ten years I got lucky back in two thousand eight and pulled out and since then I've just done extraordinarily well and I can't really explain why but I think that my portfolios is very risky at this point and I'm going into retirement so having a port fully that's a lot less risky makes more sense to me you know in case there is a market pull back I don't want to lose a lot of money to present the views they pulled out two thousand and eight how did they make any money well they got back in now okay yes I looked the part pourtant detail they pull their money out two thousand eight and then they re invested it so sorry about that so is it more along the lines of I'd rather be lucky than good here in terms of them getting back into realizing that we got lucky as opposed to it was some gifted insight into the future or what was the thought process there it's definitely be the former she knew that that she got lucky and she didn't know why and she did want to get to that position again because she felt that as with most people what can sometimes run out yeah well said Chris how old is this couple there in the early sixties engine you know they said they they made a lot of money and it must be pretty heavily weighted in stock market very heavily weight as a matter of fact like probably ninety nine percent of the cases that come to our door most their money isn't large cap U. S. stocks yeah when an interesting because we all think of ourselves as being moderately conservative but then when we look at these portfolios they're actually extremely aggressive and you know we don't realize these things and and and less we have hindsight right risk itself is only recognised in hindsight so they they're sensing that they're taking more risks than necessary net that really came to you at the right time I would think yeah absolutely and you're the one thing that was really heavily communicate to me was that that they're very fearful you know if the market pulls back you know that's really I think that's that's really can derail what our plans ours is exactly how they put it to me yeah you know the truth is I that's actually true it would you rather plans I mean how many people we know how to go back to work after the market crash in two thousand and eight the other completely tell their plans to route and I think that's a good point Bob you made here and Chris is what this investment analysis spreadsheet guys it shows you where that hidden risk years because when the market's going up like it has you're not really aware of the risks that are actually in the portfolio is in the quote you know question is if it goes under the stress test the market goes down how well is your portfolio gonna hold up in this portfolio based on this analysis would not hold up very well yeah exactly I I would say even back in two thousand eight had they stayed in they probably what it's taking close to a forty percent hit and to B. millions of dollars looking at the size of this portfolio and no one wants to see their portfolio go down by millions of dollars when they retire that's just like what Bob like to say a buzz kill I feel like that the way more than a buzz kill that's that that might even be a a financial life killer yeah I know I think and you know what I like to do when I sit with someone you just meeting for the first time in their aggressively invested like this is like take a red pen and I crossed out there you know seven million and show them what forty percent down looks like an right that number on the statement well boy that's a that gets people's attention I know it's funny you mention that Bob that's exactly what we did I actually took their their total value deport fully I said this is what would happen well you know I think that the interesting thing is that the proposed portfolio what you recommended they do not only reduces the risk but it looks like they're going to increase their cash flow by over a hundred thousand a year is that right that's absolutely correct not only that he gets exactly what we all want retirement exactly and and not even that it's also going to reduce their it's also going to reduce their tax liability by using tax free municipal bonds so right you know I know hundred thousand may not sound like a lot to some people sounds like a lot to medium extra hundred thousand like to give me every year and must be rhetorical question to the answer is no Bob okay just checking but no it doesn't matter whether it's ten thousand a hundred thousand or your quarter million dollars increasing cash flow which is a castle that's going to be repeatable dependable actually go up every year well tell you what that's that's really what you want to think about when you're in that distribution phase of your life once you're in retirement yeah absolutely and not only that but compounding it over the next twenty thirty years makes a huge and drastic difference no I I I see a part of your analysis Chris it they just continue if they get that additional cash flow in a compound that the average rate of return in twenty years they're gonna have an additional four million dollars yeah I think that's it I think we can all agree it's a very big number and that could that could purchase a lot of vacations and and many other things that this couple really wants to do you know once they stop working yes incomes predictable capital gains aren't they were smart enough for lucky enough to get an aggressively invested where they meet you at the right time absolutely what you know I always say you get a better outcome with income and he well like about this Chris is your less reliant on the ups and downs of the market and your more reliant on predictable income that comes in every single year so is Bob likes to say the nother financial masterpiece well done on this thanks a lot Ryan as always I always appreciate having all pain weekend with you and dad it doesn't get better specs with our special brother gassed if you're thinking yourself right now this is the kind of review I need I need.

Coming up next