On this (inaugural) episode of The Retirement Success in Maine Podcast, we are joined by the founder of Guidance Point Advisors, Wes Del Col. Wes opened Guidance Point Advisors in 2008, essentially from scratch, and has helped grow the company to where it is today in a little over ten years.
We begin the episode by taking the time to introduce Wes. We ask Wes about his upbringing, education, and what ultimately led him to make a career in the financial advice industry.
After getting to know Wes, we switch gears and begin discussing the company, Guidance Point Advisors. Wes goes into detail about how he came to found Guidance Point and what makes Guidance Point different. Also discussed is the type of people Guidance Point works with and how the company helps its' clients reach their own Retirement Success.
Staying on topic of retirement success, the conversation shifts back to Wes. We ask Wes what he sees his retirement looking like and how he personally defines his own Retirement Success. We close the episode with a conversation focused around how the financial advice industry is changing and how we feel Guidance Point will have to change with the industry over the coming years.
What You'll Learn In This Podcast Episode:
- Who is Wes Del Col? What made him become a Financial Advisor? [2:05]
- Learn about Guidance Point Advisors. How did the company begin? [11:02]
- How and with who does Guidance Point Advisors work? [18:35]
- How does Guidance Point Advisors fit into our client’s Retirement Success? How is
retirement success defined? [23:23]
- What does retirement look like for Wes? What is his definition of retirement success? [39:00]
- How do we expect to see the financial advice industry change over the next 20 years,
and how will Guidance Point change with it? [43:34]
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Ben: Hi, my name is Ben Smith. I'm joined by my co-host, the goose to my maverick, Mr. Curtis Worcester. How you doing today, Curtis?
Curtis: I'm well. How are you?
Ben: I'm good. Our inaugural episode of Retirement Success in Maine Podcast. On today's show, we're really excited to have a conversation with Wes Del Col. Wes is a managing partner and founder of Guidance Point Advisors, so really excited to Wes to talk about Guidance Point a little bit today. So, Curtis, why don't you just read Wes's bio, just for everyone listening?
Curtis: Yeah, sure thing. So, as you mentioned there, Ben, Wes is the founder and managing partner of Guidance Point Advisors. He has devoted his 20 year career in the financial services industry to providing comprehensive wealth management and financial planning services to select individuals and organizations.
Curtis: Prior to founding Guidance Point Advisors, he was senior vice president at Retirement System Group, with responsibility for developing the company's discretionary investment management business, and designing individual investment strategies. He specialized in portfolio management and retirement planning services for his clients.
Curtis: Before that, he was a sales associate in the private client service group at Lehman Brothers. At Lehman, Wes was a member of a five person team responsible for managing several hundred high net worth client relationships, exceeding 800 million dollars in total assets. Wes currently lives in Wellesley, Massachusetts with his wife, Caroline, and their three children.
Ben: Well, welcome, Wes. Appreciate you joining the podcast today. Thanks for being here.
Wes: Thanks so much for having me. Excited to be here on the inaugural podcast.
Ben: Yeah, the maiden voyage, if you will. So, wanted to get right into it with you. For the listeners, wanted to just give a good little intro to you. Obviously, Curtis just did the read, but all of us are 3D. So, let's talk a little bit about your upbringing and how you got interested in financial planning, and that origin story, if you will.
Wes: Sure. So, I was born and raised in Boston, MA. Grew up in an apartment on Beacon Street. My father was the son of Italian immigrants who came and had immigrated to Rochester, New York. My mother had grown up in Dorchester, MA. The two of them, I think, had met on the beach out on Cape Cod while my father was celebrating his graduation from college, at Boston College, and had met my mom and a few friends, well, when he was with a few friends over there, and they decided to move to Boston. Both of them came from very modest means. My grandfather on my father's side was a gardener. My, on my mother's side, grandfather drove a truck for a while and had different jobs.
Wes: I went to school in the Boston area. I went to high school, actually, in Connecticut at a boarding school. Then, it was really in college I became a child, or psych major, that I really started to think about what I might want to do for a career. Hadn't given it much thought prior to that. I took those various personality tests, like the Myers Briggs test and things like that, and I always received that I should be a teacher or coach, or something of that nature, or maybe even a psychologist.
Wes: So, I always, before I left college, thought that I would end up teaching when I came out of college, and that was always the goal. At some point during my senior year, I realized, "Geez, you're going to have to make a living wherever you go," and a bunch of my friends were moving to New York City, old high school friends. So, I started looking around for jobs. My father was in finance, and most of the people that he knew, or the contacts, because that's who I was trying to leverage to try to get in, were all financial services related. So, I ended up getting a job at a company called Colson Services. They were the transfer agent for the small business administration.
Wes: Then, from there, I ended up getting another offer from Lehman Brothers, and started working there in 1997. It was that point where I really started to develop an interest for ... Well, a first introduction to Wall Street, really. I wouldn't say that I developed an interest in financial planning at that point, but I knew there was something in terms of dealing with people and the clients there, as well as the energy from working on Wall Street, that I really liked. So, that was sort of my upbringing and how I first got introduced to the wealth management piece. The financial planning part sort of came later.
Curtis: So, at this point, Wes, as you mentioned, you're on Wall Street. You're getting a touch of wealth management. At what point did you, or how did you fall in love with it?
Wes: Well, I think like most love affairs, it grew over time. I think I had had the initial experience at Lehman, and that was exhilarating. I was living in New York City. I was 22, 23 years old, going down to Wall Street, and really getting an education. At that time, it was a very different business than the business that we have today, in that there was a lot of commissioned sales. We were buying and selling stocks for people and doing option exercising for clients, but it was very exhilarating, very energetic. It was a trading floor-like environment, and I think that's really where I first started to say, "Wow, this really gets me going every day and gets me up."
Wes: So, that was sort of the beginning of the love affair. Then, at the same time, my father, and this goes back to your, sort of, the upbringing question, he was building out an advisory platform in the early to mid '90s. Sort of the second act, he had been in finance his whole life. It was an advisory platform that was one of the first of its kind. It was trying to help bank broker dealers, advise it like we are today, manage their clients, build out portfolios for them.
Wes: So, he also ... While I didn't work there, I spent a lot of time chatting with him about it and being around while that business was being started. So, I think that also helped me understand a slightly different aspect of the business, and I had always looked up to my father along the way. So, I think that those things together sort of became the beginning of the love affair with wealth management [inaudible 00:06:44].
Ben: So, in terms of, Wes, in terms of your career, it sounds like you've kind of been surrounded with lots of different types of exposures, right, where you've kind of ... Your family is in the industry, right, that way? You've essentially worked in a sales position. You worked in the loan processing side, so you've seen the operational end. Why did you ultimately settle on client advice, right? So, you've seen all these areas. Why is that the one area that you thought, where you could make the most difference with people over time?
Wes: Yeah, good question. I think, for me, I was always going to do something that involved a high level of personal interaction, or utilized interpersonal skills. I think I very much enjoyed interacting with people, helping them solve their problems. It could be coaching, teaching all those things that those tests said when I was young are actually true in terms of the things that I'm geared towards.
Wes: So, I think what happened was my career took a different turn in that I started in finance and working on Wall Street. That was providing me with a knowledge relating to investments and financial planning. So, it sort of became a, "Gee, this is an expertise that I have. How can I marry the two?" So, becoming an advisor was a way to do that, where I felt like I was still going to be able to take part and have that sort of personal interaction and use the interpersonal skills, but also leverage all of these things that I was spending time learning and doing every day on the financial side.
Curtis: So, we've talked about the "how" and the "why" for you. Currently, as you've said here today, looking at the 20 years of experience that you have, what is it that you could say you currently love right now about this career path?
Wes: Well, there are a number of things I love about it, but I think it's always ... I think, inherently, we all like to help people in one way, shape. So, to me, it's very rewarding to be able to help people either achieve their goals, or sometimes help people find solutions to financial problems that they're struggling with. The one piece of the financial services, we always talk about the market and everything else, but there's, I think, as you guys both know, the huge behavioral element where you can see people about to make decisions that they think are in their best interest, or they're operating out of fear, or they're operating out of happiness. Sometimes those decisions are clouded, and they need someone else's ... help them or guide them through that.
Wes: So, I think that aspect of it is really enjoyable for me. I love the behavioral aspect. I love the interpersonal. I love trying to help people, and as you guys can attest, too, it's very rewarding at the end of the day to have either clients come in, or to see a progression over a decade of time working with somebody, where they're at a place that you thought you'd be able to get them. They're doing it on their own, but you're just sort of helping, pushing them in the right direction, and now, all of a sudden, they're there. So, that's really what I love about it.
Ben: So, of course, when you have a coin flip, right, it's one side of the coin is the things you love, and the other side is there's, sometimes, there's things that, maybe, you don't like. What are some things that you'd say would be your least favorite things about the financial advisory world? Whether it be ... Could be day to day. Could be just kind of situational, or maybe the industry. What do you not like?
Wes: Yeah. There's one that's sort of a double edged sword, and that is the financial advisory world is highly regulated. In some ways, that's a good thing. We should be regulated because we're handling people's money and finances, but as a result of that, that can lead to an abundance of, what I would say, are administrative and finance related tasks that, at times, can make you feel like you're jumping through hoops, and you don't really have ... Or you're saying, "Geez, why ... This would apply to, maybe, a bigger institution. Obviously, we're a relatively small organization, so why do we have to do that?"
Wes: So, I understand the need for regulation and why it's there, but sometimes it can almost feel overbearing, I think, for some of the smaller advisory firms, especially when we feel like we're doing a great job for our clients. So, I think that's probably one area that I don't love about it, but it's not changing any time soon. So, there's really nothing we can do about it.
Curtis: Well said. So, we've kind of covered you, Wes, as an individual, and your upbringing, your history, why you do what you do. Let's dive in a little bit on Guidance Point Advisors. Can you just give us a history, or the history of Guidance Point Advisors, and how it's grown over the years?
Wes: Sure. As I had mentioned, I was working at Lehman Brothers. That was in the mid to late '90s through 2001. I left Lehman after 2001 and went back to business school up in Boston, and then moved back down to New York after business school and started working for a smaller firm doing the wealth management portion, even though the firm was more of a retirement plan consulting firm. That firm was sold in 2008 to a larger retirement planning firm that didn't really have a wealth management arm. So, it was at that time where I had, probably, a handful of clients, maybe 10 to 12 clients that I thought would come with me if I went out and either hung my own shingle, or started my own firm.
Wes: So, it was at that point that I came to the conclusion that I wanted to try to open my own firm. The name Guidance Point Advisors was something I came up with just sitting at my desk. I knew "Guidance". "Guidance" just kept coming back to me as, "This has got to be either in the name, or part of it, because that's really what we're providing people." So, came up with the name, and then launched shortly thereafter. It takes a little bit of time to get up and running from a regulatory perspective. Then, thankfully, all of those clients came over, all 10 of them. That probably represented, geez, who knows, maybe 15 million dollars in client assets.
Wes: Then, well, for about three or four years, it was just me. Then, in 2012, Ben joined. AJ joined. We've had Abby join along the way, and Larry, and Chris, and now Curtis as well. So, we've grown along the way. Now we service, almost 10 years later, probably somewhere in the ... around 160 families, and over 240 million in assets under management. So, we've grown, I think, smartly. We've obviously grown at a fairly rapid pace, but what bringing on individuals and people who can handle that business, it feels like it's been sort of a nice mix of organic and inorganic as well.
Ben: Wes, so, you would also say, too ... So, in 2008, when you had that separation, and that book of business came with you, is that also ... Well, you were living in New York at the time, and then you moved to Boston? Is that correct?
Wes: That's correct. I should clarify. So, I was in New York until 2011.
Wes: So, the firm was started down in New York. First three or four years were in New York City. Then, we had our third child in 2011, and we were living in Manhattan with all three kids. At that point, I was also ... had been talking with AJ, who was up in Maine, and it seemed like a natural fit, obviously I'm from Boston, to come back north. My wife was also from the area. So, we decided it made more sense to come back up here, and we shifted the organization up to Boston and have been here ever since.
Ben: Also, in terms of growth, right? So, when AJ became involved with you at Guidance Point Advisors, that also expanded us in terms of our geographic footprint as well, in which you want to walk into that?
Wes: Exactly. So, I had to add, obviously, a lot of clients down in New York and tri-state area, but also had had some clients up in Boston, with the addition of AJ. Then, obviously, with you coming on board, Maine became a huge part of our business. Now, actually, we have more clients in Maine than in any other state, but we also have a bunch scattered throughout New England, up in Vermont, New Hampshire, as well as Connecticut, and then, obviously, down in Florida, and various other states around the country, as well as a few international clients. So, the geographic footprint obviously goes where the client goes, and some of those clients have moved around as well. So, we're pretty spread out, but we seem to get to everybody, and everyone seems to be happy with that arrangement.
Ben: Wes, you and I have had a lot of conversations, I think especially the last two or three years, right, as we've been growing, and that's been great. Some of it is just because people know us, and they get to know us, and they measure us in regards to our personalities, what it's like to work with us, all of that. One of the things that you and I have talked a lot about is what makes us unique, and who do we work with? That's been something I think where we, even last fall, I think we probably spent, probably, 60 to 80 hours just even identifying that one question. So, love to hear your take on it, and what you're thinking about for us today.
Wes: Sure. In terms of what makes us unique, I always think, regardless of the size of a firm, it's really the people who work there who make the firm what it is, who make the client experience what it is. So, I think for us, it's the six or seven people that work at the firm. I think if there's one common thread among all of us that might be unique in terms of how we deal with people, it's that we all view ourselves as educators. I don't think any of us come from really ... sales backgrounds. That's just not the way we approach people. It's not the way we approach our client relationships, and I think that really shows through.
Wes: As you mentioned, most of our business, or most of mine, I should say, comes through referrals, and I think a lot of that is the way we treat our clients. Obviously, there are all the things around being full service, in terms of offering money management, and also all the financial planning capabilities and trying to do those under one fee, but I think the really unique part is more around who we are, how we view ourselves, and, in turn, how that translates into how we work with our clients.
Wes: I also think because we're a smaller firm, and we're able to, I don't want to say "choose" our clients, but in some ways, we are, I think most of our clients share those same values. That's really important and kind of makes the whole firm unique in some way. I would say this, too. In terms of who we work with, we have a very disparate group of people if you look at it from, not everyone ... and then also a high net worth category. We have people with more modest means. We have people who are very wealthy. We have large relationships. We have small. Geographically, we already discussed. We have people coming from rural areas, certainly cities. We have a large contingent of healthcare professionals.
Wes: I think some of that has come from word of mouth, and those individuals who were clients telling friends of theirs, but I think, again, the common thread with those people, and we've talked about the clients that we work with, is that they're ... From a value standpoint, who they are really seems to match and fit with who we are, and I think that's a unique thing with our firm. We're not just out there trying to get our numbers up or get additional clients. I think we all feel that we genuinely enjoy the people we work with, and that they can genuinely enjoy and think our advice is helpful as well.
Curtis: So, continuing with the types of clients that we work with, can we touch a minute on pricing? How do we, as the advisors, get paid, and what type of person, or who, can afford a financial advisor?
Wes: So, our typical pay structure is based on a percentage of the asset that we're managing on someone's behalf. So, to translate that into real numbers, if someone had $200,000 and we were charging our 75 basis points, which is simply three quarters of one percent. That would come out to around $1,500 a year. If that person had a million dollars and we were charging the same amount, that would come out to around $7,500 a year. So, our typical fee is based on the assets that we're managing, but that also includes the financial planning and everything that we would do from a budgeting standpoint or a retirement planning for that client.
Wes: Now, you can also, because you say, "Who can afford a financial advisor?", so you can see, it really doesn't matter the dollar that you have. If we're using a percentage of the assets, then someone with only a couple hundred thousand dollars could be a fit, and so could somebody with a much larger balance. For people who may not want to pay in that manner, there's also ... We can do hourly fees. There's project based fees. So, really, I think there's different ways for people to afford an advisor.
Wes: I think one common, not myth, or thought is that people think, "Gee, I'm not wealthy enough. I can't afford to have someone like this," or, "It's not right for me. You need to have a certain amount," and that's not really true. I think that getting good advice on your finances, budgeting, and everything else can be something that's just as valuable, if not more, for somebody who's living paycheck to paycheck, as it is for somebody with a very high net worth.
Ben: So, Wes, can you just expand on something a little bit there too? One thing that may make us different there, and this word, "fiduciary", is being tossed around a lot. I think there's, maybe, misconceptions on how it is applied in different situations, but how do we think about the word "fiduciary" and what it means to our clients?
Wes: So, the word "fiduciary", to me, means placing the client's interest ahead of our own, and that's something that a large ... Well, I think that goes back to when I was talking about who we are as people, what our values are, how we work with our clients. I think that shines through immediately to our clients.
Wes: If you work in the broker dealer world, that's not really a fiduciary capacity. Most of the time, and even when I worked Lehman Brothers, which was in that world, there are products that are being sold. There are products with commissions. The best interests of the client aren't always what's being sold to the client, and I don't think anyone that works at our firm would be comfortable in that type of scenario or environment. I think one of the things, that why we've all come together in our firm, is because we do all view ourselves as fiduciary, and know that that's an extremely important part of the client relationship, and, really, the only way to give, really, objective, independent advice in its truest ... Well, that's the way I view it.
Ben: So, what would you say, then, would be the myths about financial advisors that are not true anymore, or really don't apply to us at Guidance Point Advisors? So, what's really changed, and how has it changed?
Wes: From the myth standpoint, it kind of ties into everything we were just talking about. I think there are so many overlapping names and terms flying around where people ... that a few have to digest who are not in our industry, and potential clients. So, I think what happens is, often times, people think that we're all the same. They just cover us with a very broad brush, and the truth is, we're all not the same. In fact, we're very different in terms of how we interact, how we get paid, the services we provide. So, I think it's really difficult for consumers to understand what types of services they're going to be receiving, whether the person's a fiduciary, what do they mean advisor versus financial advisor, investment advisor, financial planner, wealth manager?
Wes: So, I think that it's something that the industry, and obviously individuals who are out there talking, who are in our capacity as advisors, need to lay out to people in a very easy to understand manner, because I think right now, I don't want to call it a myth, but I think one of the things is that people get confused by the terms and turned off by them because it's something they don't fully understand. That sort of confusion leads to inertia, or just not doing anything. So, it sort of falls on us and is our job to make sure that that's not the case.
Ben: I do want to switch streams with you a little bit here. Of course, with this podcast, it's titled the Retirement Success in Maine Podcast, right? So, a lot of what we're trying to accomplish for those listening out there is this idea of, "What is success?" Right? Success is different for everybody. This kind of concept and this topic that we're trying to get to, how does Guidance Point kind of fit into this? So, I wanted to kind of have that be our next topic that we really dove into.
Curtis: So, to dive into that, Wes, how do we see people and our clients define retirement success? Has that changed over time, in your experience?
Wes: I think it's definitely changed over time from 30, 40 years ago. First of all, as we all know, people are living a lot longer in retirement. So, just from the time they retired and how much longer they had to live, sometimes can almost be a third of your life, be a quarter of your life now. So, I think that's changed. That doesn't necessarily mean the success portion has changed, but I think retirement in general has changed over time.
Wes: I think that success, if you want to try to define retirement success, it's a very individualized thing. I have clients who want to keep working part time. I have some ... and it's not just they want to work part time for the income, and often times, it's just to keep their mind going. There are others who completely want to separate from work and focus on their hobbies. I'm just thinking right now, I have clients that, about two years ago, had been really, for the last three or four years, focused on retirement. They were East Coast based, and they had three children. One of them lived abroad, and two of them lived on the West Coast. For them, they said, "This is going to be a big leap, and we're nervous about it, but I think we'd like to go to the West Coast and be closer to our kids, and also the grandkids who are on the way."
Wes: They made that leap about two years ago and could not be happier in terms of where they are, how often they get to see their kids, going to a new environment. That can be scary because you have all your friends. You have a structure in place, and next thing you know, you're really changing that, and you're moving out to be closer to your kids. So, I think for them, that was, and has been, and will continue to be retirement success, whereas I have other clients that have stayed much closer to home and continued to work on a part time basis, or maybe even on a consulting basis. That's really kept them sort of feeling like they're still using their brains. They're still active.
Wes: So, I think it varies from person to person, but I think one of the most important things, and, Ben, you've said this a lot, and I think it's a great statement, is that you really need to have something that you're retiring to, not just retiring from. I think that's true, and that's something that we work with our clients on before they get there, and saying, "Hey, I know we're always focused on sort of the financial aspect of this. Do I have a nest egg that's sufficient to get me to where I need to go?" They haven't spent enough time either focusing on being back in the same house during every day with the spouse, or some of the other variables that come up. That can be a big shock for the system. So, I think a big part of retirement is that, is the planning for it, and I don't just mean the financial planning. I mean the psychological planning for it as well.
Ben: Yeah, and I love that too, and I'll just kind of add to it. What I see is, too, is that it feels like what I've experienced, as well, is this ... There's a few generations that very strongly in their minds is this fear and this thought about the Great Depression, right, is that they either were a generation that lived through it, or their parents were living through it. They had a very exact attitude about money, and it was a lot of risk mitigation, is where they're thinking about it.
Ben: So, I think about my grandparents. I think about even my parents and their attitude towards money, that there is a fear around spending because of, "Well, I don't want to spend it. Then, if something catastrophic happens to the world or the economy, then all my financial assets are gone." So, it is amazing that now, maybe some of that's fading, right, and I think there's probably better systems in place. I think probably better advice in the industry is happening as well, that, really, the population is making better financial decisions to avoid those sorts of situations, or be better positioned to withstand those situations. So, now they're able to focus in on those attainment goals, right, as this kind of thought of success.
Ben: So, again, what you said, Wes, was spot on. I literally love that, is the, "I'm retiring, yeah, from a career where I was binging on working to get to pleasure, but, really, when I retire to something, I need to think about that," right? How would my week be filled, that 40 hours, or however many hours of that week? If I'm a golfer, well, I can't golf 40 hours, and eight to five, right? There's going to be other things that's going to go on. I've got to fill that time. So, I can't just say, "Well, I'm going to golf." Well, that doesn't really help.
Wes: The only thing I would add to that too is, and I'm sure you've seen through your own clients, clients who have the most money, the largest nest egg, aren't necessarily the happiest ones in retirement.
Wes: So, in having that plan in place, or being able to do what you want to do, or however you define retirement success, it's really not just financial. There's plenty of examples out there of individuals who have the nest egg, but don't know what to do with themselves. That becomes almost a bigger problem than not having the finances.
Curtis: Yeah. So, continuing here with this retirement success, naturally, on the road to success, there might be some bumps. What kind of problems do we see our clients face that we work with them to solve? Parallel with that, what outcomes do we help to create for our clients?
Wes: So, there are obviously a number of them. I mean, one, I think that ... I'm just thinking of a couple of clients that I'm working with just now, that become a more prescient issue recently because, I think, people are living longer, is the whole concept of diminished capacity.
Wes: So, I have a number of clients, one in particular that I'm thinking of, that was on a good path to retirement. In their mid 70s, they had started to show some signs of dementia. As you you guys know, we spend a lot of time reading about dementia. I listen to a lot of webinars and things like that in terms of how to deal with clients who you might think are experiencing that, because one of the first places that you typically see signs of it can be in handling finance. So, sometimes these people are starting to have, and this one in particular was starting to have trouble on calls.
Wes: So, we brought the children in, got the children involved, got all of the necessary paperwork in order for them to be able to assist, and I've been working with the kids on that. It doesn't have to be diminished capacity. It could be other things that could be happening where those clients need additional help and need other family members to get more involved. That can be an awkward situation because, as we all know, we're all reluctant to ask for help, but we all are reluctant to admit that we might be, I don't want to say ailing. It's too small of a word, but might be starting to decline.
Wes: So, I think having those conversations and helping the clients, helping clients solve those problems, whether it be through getting children involved, or an estate planning attorney, or someone close to them, is definitely something that we've been working a lot with and I see a lot more of. I think given the ages of people, I would say another piece of that, and we've kind of been touching on this earlier, is how to budget in retirement. So, a lot of people are thinking about, "Geez, what's the number that I need get to so that I can live comfortable for these years?" But they haven't really thought through what their spending's going to look like during that time. How are they going to live? What's a comfortable number that, when you include taxes and you think about inflation, factor in all these things? They haven't gone that far.
Wes: So, I think we're helping clients solve those problems well, or certainly answer those questions so that they can be comfortable on a daily basis, knowing that, "Okay, we have a plan in place, and it's built to potentially have some shock. Market is going to move around, but I know that if we just sort of follow this path, we're going to be in a good place." So, I think those are types of things that we find ourselves wrestling with and helping clients attain those goals and meet those objectives by planning it out with them, and using different tools to help them get to where they want to be.
Ben: Yeah, and I'll add to it too, Wes, because obviously the problems just vary by life stage, right, is a 35 year old that comes to us, and they may need help, could be very different than an 85 year old. It seems like a lot of the clients that we've been gathering more recently, it seems like they struggle with a couple things that I've noticed. They're usually kind of in this pre-retirement mode as, I don't know, for whatever reason, that's kind of the spur that kind of gets them to say, "I need help," but that they've accumulated a lot of financial assets, and they just don't have an organization around them.
Ben: Then, so they're not organized, but then they're very low confidence with what to do, right? They don't really have a plan in place. To what you've said, they've not really thought all this part out, and when they're low confidence in what they have, whether it's going to work, how long it's going to last, they really don't know if, or what decisions they should be making. So, to your point about the client that was moving to California, if you really just have no confidence at all whether that's going to work, you just might never do that, and you're missing out on life. You're missing out on your kids and your potential grandkids. So, that's just the type of things that just is a tragedy of life, right, is you're just too scared to make that jump, just because it's a financial reason.
Ben: I'll add a story. I had a client that came to us a little bit ago, and they were concerned about Medicare cost because they weren't quite at Medicare age. They were really talking about the amount of premiums, so they keep their income level down enough because of buying medical coverage on the open market. So, they keep their income down, so they didn't want to spend, right? So, they didn't not only want to spend, but they weren't going to go do things. So, here they are. They retired, and they have a reasonable amount of money, but because something like another $5,000 of medical expenses, they weren't going to do things that they'd been waiting forever to do. You start framing that a little bit better and putting that question out there. "Well, are you not living your best life today because of $5,000?" They stopped, and that really slapped them. That really kind of made them stop and think as, "You know, you're right. Maybe that is stopping us from taking that vacation we've always talked about. We're talking about capping ourselves for the next few years because of this medical decision."
Ben: So, working through that type of thing, and just changing their permutation on how they view money and life, it's pretty powerful when you see that unlocked. It really makes this job worth it.
Wes: I think it's so true because if you ... Often times, it is one individual thing, just like you pointed out, that can paralyze somebody, and we've all been through that. You almost need someone to talk through that with to understand, okay, there's a way to deal with this, and that's going to help us, like you said, unlock the future for them so that they can work through it. Sometimes it's very easy, and not just in the financial side of your life, but another thing is to get hung up on one particular thing. So, I think that's a very good point to make.
Curtis: So, staying with this helping our clients reach this retirement success, I don't think it's that uncommon. We often find we have clients who don't necessarily have assets, but they may very well be high earners, or need help sorting out their goals, whether it's in life or financially. How do we align those goals to their spending and saving priorities for them?
Wes: So, I think something that we're all geared towards at our company here is helping people to sort through their priorities, their goals, regardless of how much money they have, right? I don't think we view ourselves as a firm that's only trying to find people who have the most money on the block. So, the one way to try to help those people is ... We mentioned this before. Sometimes people maybe just need a few hours of your time, or maybe there's a small project or a plan they'd like to build for education, and just to know that they're there. So, we can certainly help people that way without having the assets under management and everything like that.
Wes: I can think about, this was about a year and a half ago, a friend of mine's mother who lived down south, she has all of her money tied up in a 401(k) plan and obviously likes where it is and liked the management of it. So, she wasn't a candidate for us to manage any of the money, but she was somebody who really needed some help along the lines of the things Ben was just talking about in terms of understanding her retirement, her spending levels, whether or not she was going to sell her property down there and downsize. So, rather than say, "Geez, we can't help you," I just did it for a one time fee and said, "You can call me as much as you want, and we'll work through this. Does that work for you?" She said, "Oh, that would be great."
Wes: So, then we worked through a number of scenarios and built out different plans for her, had her review them. She followed up, and we went back through them, and eventually came to a place where she felt very comfortable with what her trajectory looked like. I felt great about it as well. So, there's just all sorts of different ways to help people that don't have, which is obviously a lot of us in our 30s, 40s, even into the 50s, who are spending a lot, whether it be on education or other things. They maybe have great income, but they're utilizing most of it, so they don't have a lot of assets to invest, and that's okay. Sometimes those people are the ones who need the most assistance in terms of developing those priorities. So, we're certainly able to help people like that as well.
Ben: And ideally too, right? If we're helping them maybe when they don't have a certain level of assets, that, by giving them just good, sound advice, maybe they're able to make better saving decisions or spending decisions that ultimately lends them to have more assets over time, and maybe that creates that client. So, win-win from that perspective as well. For whatever reason, we've had several couples in their early 30s working with us right now, and that's been a lot of this talk, is there's so many frictions on their money, right? Yeah, they're earning, but they're just quickly being absorbed with how they're spending it, and they just don't know if they're just doing it the right way. So, helping them identify and work through those challenges and problems, yeah, there's certainly need in lots of different segments, right?
Ben: So, it's there's traditional wealth management of, "Well, wait until you're 65 years old. You retire, and now you have money, and now I can afford a financial advisor." I think that world has changed pretty rapidly, especially in the last maybe 10 years or so.
Wes: Oh, and I think it's continuing to change.
Ben: So, Wes, maybe just switching a little bit in terms of the questions and problems our clients are facing, but what about you, right? What is, in terms of you and your career, and what does retirement look like for you? How would you define your own retirement success here?
Wes: Oh, we're going to dream for a minute. I like it.
Ben: Okay. I like it. There we go.
Wes: We do have the benefit, you, and when you work in a position that we do, to watch other people go through it before us. So, I'm 46 years old, and I have a, hopefully, a lot of years left, both work and retirement, but I've had the benefit of watching others enter into retirement and seeing some of the pitfalls, which we've discussed, as well as what's made them successful.
Wes: I guess I envision, for myself, having a hand in a few different things. I think I would like to, hopefully, still be working a bit when I retire, meaning still having a hand in the business and helping, but maybe it's on a reduced scale, so that I'm still active and keeping my brain active. I think coupling that with having the freedom to go see our kids wherever they may end up, or romanticizing the future, and obviously grandkids, at some point. I would love to travel a bit and visit with friends.
Wes: I think another important part for me would be staying active physically, too. I'm somebody who, on a daily basis, likes to work out, or at least get the blood flowing and get a little sweat in. I'm hoping that as I age, even if that's a day of skiing or a walk, whatever it is, being active in that way too, I think it's important to keep your mind stimulated. I think it's important to keep your body stimulated, if you have that ability, and then, really, getting to a place where you're just able to do what it is that you want to do. So that's, I guess, what I would hope retirement would look like for me someday, but, as we know, it changes all the time, and things keep progressing, and we keep learning from others. So, only time will tell.
Ben: So, obviously, I would say that there's kind of that pie in the sky and the dream for you, but life is what happens when we're busy living, right? Is that type of thing, right? So, what would you say, in terms of struggles with, "All right. Well, there's things that I want to do today," right? Is, "There's things. Our kids are only going to be this age once. We're only going to be in this position once." So, doing things, and obviously aligning your financial resources today to do those things, and maximizing that happiness today, while also planning for tomorrow and tomorrow's happiness, that's a really hard challenge and a counterbalance to work on. What struggles have you had with that, and how do you kind of attack that idea?
Wes: So, I think you're right. That is sort of the ultimate balancing act. The less you're really in a varying situation, you're not going to be able to fund every account, hit every milestone that you've done, or accomplish every goal. So, I've always felt like it's important to have smaller, sort of measurable goals, that maybe culminate into that larger goal down the road.
Wes: So, and also taking what is maybe ... Prioritize the most important things in the short term. It could be college education and funding that, alongside something along the retirement. It could be funding life insurance. It could be something else, helping out a parent that's in need. There are different life stages at which you need to have a focus on different things. So, I think it's important, because it can become very overwhelming, and to your point about the struggle, to try to accomplish all these things at once, or to feel like the weight of all of those buckets that need to be filled is on you. It can almost lead you to do nothing at all.
Wes: So, I think sometimes it's like, "Okay. Let's look at a couple of these that ... " Let's say it's college education, for example, and your kids are two and four years old. "All right, let's start, and let's see where we are in five years. We want to get to having fifteen, twenty thousand dollars in each of their 529 plans. Let's set that goal. Let's measure it every year, and let's try to keep getting there."
Wes: So, those are the same struggles that I have, which is where to allocate resources to different parts, whether it be retirement or for our children. We all, obviously, all want what's best for our kids, so we're constantly funding them, it seems. So, I think it is a balancing act, but I think one way to deal with that is to have sort of smaller, measurable goals in the short term that end up helping the big picture, but don't overwhelm you by only looking at the big picture, if that makes any sense.
Curtis: Yeah. So, we're going to change gears here a little bit, Wes. We've alluded to this earlier in this episode. It's no secret that financial advice in the industry as a whole is changing. How do you think that financial advice is going to change over the next 20 years? Then, with that, how will our business change with it?
Wes: So, I think we've already seen, even over the last decade, probably even 20 years, that the delivery of advice has changed. I mean utilizing technology to help in terms of building portfolios and things like that. I would expect ... Then on the personal finance side, there's things like Mint, even the software that we use, that didn't exist 15 years ago, to help with planning elements and the saving elements, and help people coordinate and organize their assets.
Wes: So, my best guess is that that, the technology, will continue to play an outsized role in financial services and financial advice going forward. I still think and believe that there will be a human element that will still play significant role in the planning and the behavioral course of the relationship. Perhaps there will be bots or technology that can assist with that, but I still feel like people, at least I know I do ... I think in 10 years, I will still feel this way. When I'm buying something or making a major life decision, I sometimes want to talk to somebody about that, a professional in that industry about it, just to make sure that I'm doing what I think I should. Even though a lot of the administrative back off, allocation, all those types of things, I think, eventually will probably be handled by technology, I think it will be a marriage of the two that will best serve people, but who knows. Things have been changing at a rapid pace in not just our industry, but in many other industries as well. I think it'll be really interesting to see how it plays out, but I don't think the industry's going away.
Ben: Well, Wes, I think with that note, it's probably a good time to wrap up today's episode, number one, again, Retirement Success in Maine Podcast. I want to thank you for sharing your experiences today, and expertise. It was wonderful sharing the conversation of working through a lot of what Guidance Point Advisors does with success, whether it be in retirement or out of it. We know that a lot of this conversation, we hope, will help not only our clients who are coming to us a Guidance Point, but also listeners that are struggling with the same issues on their own. So, Wes, appreciate the time today, and looking forward to maybe having you on a future episode later.
Wes: Would love to. Thanks so much for having me, and very much appreciate it. It was great to chat with both of you.
Ben: All right.
Ben: All right. We'll see you.
Curtis: We'll see you, Wes.