February 29, 2020 • 54 mins
“Your ownership in the business, the way that you finance your exit, allows you to help that person finance the sale and is an annuity for you.” - Bill Heestand
In this episode, I spoke with Bill Heestand, author of the Ownership Ladder about how to set up a successful internal business transfer & sale including setting a reasonable valuation. We also discussed how to succeed in the financial services industry and build a successful business.
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Bio:
Bill is an author, entrepreneur and small business expert. During his thirty-two years as a business owner, Bill grew a company specializing in highly customized retirement, health and welfare benefits and business planning for client companies and their employees. In 2017 Bill retired and relocated to Texas after closing the internal Ownership Ladder sale of his company. Following more than a year of taking stock, reflection, and fun, Bill created Ownership Ladder to share the mindset and life expertise to help potential intrapreneurs to the life they have been dreaming about.
The Get Ready Money Podcast and its guests do not provide investment advice. All content is for educational purposes. Guest opinions do not necessarily reflect the opinions of The Get Ready Money Podcast and Tony Steuer.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:13):
Welcome to the get ready podcast in partnership
with a church nerds today, I'mpleased to be joined by bill
Houston.
In this episode,
Speaker 2 (00:22):
We'll be discussing how to set up a successful
internal business transfer andsale along with succeeding in
the financial services industry.
Bill's an author, entrepreneurand small business expert during
his 32 years as a businessowner, bill grew a company
specializing in highlycustomized retirement health and
(00:43):
welfare benefits and businessplanning for client companies
and their employees in 2017,bill retired and relocated to
Texas after closing the internalownership ladder sale.
This company following more thana year of taking stock
reflection and fun.
Bill created ownership ladder toshare the mindset in life
(01:04):
treaties to help potentialintrepreneurs to the life
they've been dreaming about.
Bill has been a frequent speakerat financial services conference
on topics such as building yourpractice retirement income and
using technology.
Bill also served as a member ofthe committee for the fiduciary
standard.
Good morning and welcome bill.
Speaker 3 (01:25):
All right, again.
Good morning.
How are you?
Speaker 2 (01:27):
I'm doing well.
Thank you for joining me.
Uh, looking forward to thisepisode.
Fantastic.
Well, let's, uh, talk a littlebit about who you are.
What do you do?
Speaker 3 (01:39):
Great.
Well, I am, I continue to behappily retired, although I am
fully engaged at the same timeand promoting my book, which is
my current life passion.
I'm a member of two Toastmastersclubs.
I have a middle school girl anda high school girl, and that, uh
(02:02):
, transportation activity keepsme quite busy.
And so I have a full life.
My wife is out in the other roomtrying to keep the dogs under
control so they don't try tocome and lick us while we're a
product podcasting today.
Speaker 2 (02:19):
Well, special guests, right.
Speaker 3 (02:22):
Actually.
Speaker 2 (02:25):
So fantastic.
Uh, well, glad that you'veturned the page to a new career.
Um, so, you know, let's, let'sgo back to the start just to, so
people can find out who you are.
Um, how did you get started inthe insurance business?
Speaker 3 (02:40):
Well, it was a circuitous route.
I didn't aim for the insurancebusiness for our financial
services or even for businessitself.
I was as a teenager recruited towork in a speed shop because the
owners knew my parents and theysaid, Hey, bill is pills kind of
handy.
(03:01):
And he puts them in for us andthey taught me how to, how to
put bikes together one summerand kept me on.
And so I spent quite a few yearsin the ski business advantage to
ski shop, came back, got a jobat another ski shop, met my
first wife and she said, Hey, Iknow about, uh, some friends in
(03:24):
Hawaii, we're going to start ahealth food store.
Let's go home.
So we ended up going to the bigIsland of Hawaii, the very
Southern most community in theUSA called Leighton and start at
the Southern most health foodstore in the USA in 1979.
(03:44):
And after cleaning refrigeratorsand sweeping the floor for a
couple of years, I realized thatwas not all that, just not all
that at all.
We gotta go, we gotta go back tothe main land.
So back we came and my brothersaid, so what are you going to
do?
Then?
I said, I don't know.
And he said, well, what'd youget a job as a bank teller?
(04:06):
You can count, catch it.
I said, yeah, I could count.
So I got a job as a bank tellerand, and they found me to be
interesting enough that they putme on management training pretty
soon.
And then I was old enough to askthis question and my dad and we
went skiing one day.
And when I got into bankingsuddenly, and I could start
(04:28):
actually conversing havinginteresting conversations before
he was a capitalist pig and Iwas not.
And whatever he was doing well,then I'd grown up enough.
And we went skiing one day and Isaid, Hey dad, what is it you do
exactly.
And he spent the day regaling mewith stories, sell agreements
(04:51):
and employee benefits.
And there's new fangled thing.
It was 1984.
He had just been to the milliondollar round table.
And this was his third career.
He owned a lumber.
He owned a short haul truckline.
He sold it and retired for alittle while.
And then a friend said, Hey,come take over my dad's pension
(05:12):
business.
And, uh, so we spent that daylearning, uh, him teaching me
about this new fangled thingcalled a 401k plan, which you
just heard Tim Dennis speak ofat the table.
He was teaching, you know,unveil, unveiling it to the
world.
(05:33):
A few people like fidelity thisnew mutual fund company back
then and, uh, started to getsome traction with it.
And we started to do thatbusiness together after I said
at the end of that day.
Wow.
That is so cool.
What you're doing?
Can I join?
You heard of question in thefamily really that the least
(05:55):
likely person to go join and hisbusiness was me.
So, so that's how I got involvedin the insurance business.
It was much more interestingthan banking and here I am.
Speaker 2 (06:10):
Wow.
Yeah.
Well, you know, I'm stillwaiting for that first person to
tell me that, that they grew up.
Oh, I'm getting a little bit ofan echo,
Speaker 3 (06:21):
Um, from my side or from you,
Speaker 2 (06:25):
Uh, for me, I think it's gone away.
Uh, uh, let me make a quick noteof the time so we can have this
edited out.
Sure.
Let's see.
Where are we in the video time?
Speaker 3 (06:39):
Technology is great until it's a pain.
Speaker 2 (06:42):
Yeah, let's see.
We're about seven minutes in thewater here.
Yeah.
I'm still getting a little bitof the echo.
Um, I'm gonna just mute andunmute real quick.
Okay.
Speaker 3 (06:54):
Yeah.
Speaker 2 (06:59):
Okay.
Let me see.
Okay.
It seems to have gone away ifit, if it comes back, I'll just
get rid of the headset.
Um, so anyway, so let's, uh,punch back in.
Um, so I'm, I'm still waiting tomeet that first person who says
that that was their big dreamgrowing up to come into the
insurance business pretty much.
(07:22):
I'm sure.
You know, you've been doing thisfor awhile.
I came into the industry aboutwhen you did is pretty much
everybody I've talked to justsort of fell into the insurance
business in some way or another.
Um,
Speaker 3 (07:34):
Politically right before I got into the got hired
by the thing I applied to thiscompany called Phoenix mutual
and they gave me their tests andI said, no, you're totally
unsuited for this business goaway.
Speaker 2 (07:49):
Oh, I remember those old tests that they had at the
arts agencies.
They weren't very good atpredicting anything, but people
really believed in giving them.
So anyway, you mentioned, um,the million dollar round table,
and I think that's, you know,maybe, um, a lot of our lists
nearshore and their property andcasualty industry, uh, the
(08:09):
million dollar round tables, uh,uh, uh, organization on the life
insurance side that you qualifyfor by, uh, placing a lot of
business.
And it's a huge honor to qualifyand bill you've qualified for
both the core to the table andthe top of the table, which is a
very exclusive number of people.
(08:31):
Uh, the qualify for that.
What is your secret to success?
What, um, got you up to thequarter table and top of the
table,
Speaker 3 (08:39):
You know, it was interesting that I just worked
the business.
It wasn't really a strategicplan of mine to get the core to
the table or top of the table.
It was more my plan to grow thebusiness
Speaker 4 (08:56):
And do what we were doing in a better way each and
every year.
And by doing that, just workingthat idea and that kind of, from
that kind of thinking ithappened.
And, and I, a lot of milliondollar round table folks are
(09:16):
probably shrugging at thispoint.
You know, I had to strategizeand decide how to do it and get
there.
And that just wasn't really myplan.
My plan was to work the businessthat I had purchased from my dad
and grow it and make it reallymore significant.
Speaker 2 (09:38):
Well, that's great.
And I think that's an importantlesson for our listeners is, um,
getting the feedback again, I'mgoing to just pause the
recording for a second.
All right.
So yeah, I, I think that's agreat point that you make that
it's really not aboutconcentrating on, uh, focusing
(09:59):
on the end result, but onserving your clients and on
growing your business andworking your business is, you
know, if you keep an eye on yourbusiness is, you know, good
things will follow if you dowhat you're supposed to do.
Um, you know, so in addition tothe sales success, um, you
served as a member of thecommittee for the fiduciary
(10:21):
standard.
Um, how did you decide to getinvolved with it?
Speaker 4 (10:26):
That was, uh, an interesting transition.
I was, uh, we had, we had asignificant amount of pension
business as well as 401kbusiness, which is kind of a, an
odd thing since pensions are afading reality except in the
public sector.
(10:48):
And I, one time I got fired andwhy did I get fired?
Because a guy came in and theymade a pitch that was totally
based on fiduciary concepts anda fee-based, uh, fee structure,
(11:09):
as opposed to a commission-basedstructure.
We came up in the trendsbusiness.
So we were commission oriented,and this was a large enough plan
that I stood the, the insurancecompany that had, that kept the
business.
Since they didn't have to paycommission, they could pay
whatever fee, whatever.
I started working with thewholesaler, and I said, what
(11:32):
gifts?
And he said, well, you got toconvert to a fee-based business.
That's where it's going.
And I said, okay, that's whatwe're doing.
And in order to charge a fee,you have to take not, not just
the insurance test and not justa securities brokers test, you
have to take an investmentadvisors test and get certified
(11:55):
as a registered investmentadvisor.
Then you can declare yourself.
And it desperate fiduciary onthe, uh, on the investment side,
which is now the norm inretirement plans, nearly
everybody who is, who is asignificant player in retirement
plans is an investmentfiduciary.
(12:17):
And so, and just as part ofthat, I started, uh, becoming
it's a joke.
So hopefully nobody will take itthe wrong way, but I became a
fiduciary Nazi kind of like asuit Nazi on Seinfeld.
You know, if you, if you weren'tthat you just
Speaker 2 (12:36):
Shoot, I'm not having a good morning here on the
recording.
Sorry about that.
Speaker 4 (12:42):
Okay.
Well we're all back.
Is that like water all over thefloor or coffee?
Speaker 2 (12:49):
Yeah, no, it was, uh, a water bottle.
I was trying to adjust mylighting.
Um, sorry
Speaker 4 (12:54):
About that.
Speaker 2 (12:58):
All right.
Let's, uh, pick up.
Um,
Speaker 4 (13:03):
So I became, I became like the soup Nazi on Seinfeld,
where if you weren't afiduciary, you really weren't
seeking the best interest of theclient on the retirement plan.
And that was probably halfwayinto my career.
It was, it was probably now 20years ago.
(13:24):
And as I gradually migrated ourbusiness from an investment
commission-based business to aadvisory fee-based business,
where we were a fiduciary oneverything to take on that kind
of liability, that the lawyerswho, who teach on the subject at
(13:45):
the retirement plan meetingssay, well, you are liable right
down to your cuff links.
Since I don't wear cuff links, Icouldn't afford to lose them,
began to educate myself.
And the committee for thefiduciary standard is, was, is
one of the advocacy groups thatsimply says, if you're doing
(14:07):
retirement plan business, youshouldn't be doing it unless you
are accepting the liabilitiesthat go along with the advice
you're giving.
Speaker 2 (14:18):
Definitely what, you know, it's, it's something I,
you know, I wrote an article in1995, um, Fran bestie, you know,
stating that, you know, mythought and this was with
another, uh, insuranceconsultant that the days of
commissions were numbered in theinsurance industry.
And, uh, that day has not comeyet.
(14:39):
Um, but you know, the work thatis done by the committee on the
fiduciary standard was amazing.
Um, but you know, it, it seemslike it's kind of faded into the
background.
I mean, given the currentregulatory climate, do you think
it's going to make a comebackthat whole thought pattern of
moving to more fee-basedproducts and advice?
Speaker 4 (15:03):
You know, the distinction between an insurance
commission and an investmentadvisory fee is quite different
pricing.
When you look at the pricingformulas for an insurance
product, if you charge a fee orif it, if they amortize a
(15:23):
commission and the numbers don'tchange that dramatically, but in
an investment in the investmentworld, they do change
dramatically because everythingis real time in the future, 5%
upfront mutual fund commissionthat comes right out of the
consumer's pocket.
If you charge 0.2, 5% over time,that comes out of the consumer's
(15:48):
pocket too, but it's anamortization on the advisor's
part.
And it demands a definiteservice package that is
explicit, that is understood byall parties.
And it's an accountabilityfunction, how to translate that
(16:08):
into the insurance world.
I think it's probably easier todo though.
I don't know that much about PNCpricing, but it's possibly
easier to do there than it is onthe life and annuity side there,
because the one, a auto policyfor example, is a one-year
(16:30):
transaction, w the broker and Ihave to decide, well, is that
the right company to stay withfor next year?
Usually it is, but if some otherpricing comes in, there's really
no cash value.
There's no future value.
There's no surrender charge totake into account.
So it's a much more, uh, fluidkind of situation, similar to
(16:54):
investments.
That's where that's the parallelI see is that if I don't like
mutual fund a, but I want to bein the category that it's
covering international largecompanies, just as an example, a
fire them.
And I hire somebody else andovernight the money isn't the
new deal and the pricing isdifferent and the philosophy is
(17:15):
different, but I'm still in thecategory.
Similar auto insurance will firethem.
And overnight I'm with a newcompany, I still have coverage.
I can drive and not be exposedto, you know, unlimited
liabilities if I didn't haveinsurance.
So kind of the parallel I'mdrawing with life insurance, the
(17:37):
longevity is of the policy mightbe 50 years, the amortization of
a commission over a 50 yearperiod of time.
It irons out to be a relativelytiny number.
And you really wouldn't want tocharge a fee to a, to a consumer
that is equal to the fee or thecommission that is paid on a
(18:02):
life product or an, or along-term care long-term
disability.
That kind of thing.
Speaker 2 (18:08):
Definitely what I'm sure we can cover a whole
episode, Justin, with that.
Those are some great points init.
And you know, that probablyanswers the question of why, at
least in the life insuranceside, we haven't seen those
types of products succeed.
A number of companies havelaunched different, no load and
low load concepts, and they justhaven't caught on.
(18:29):
Um, so let's, uh, transitioninto what you're doing now.
Um, you know, I, I, I'd like togo back to 30 years ago where
you purchase a business fromyour father, cause you know, to
talk a little bit about whatthat process was like and how
that led into what you're doingnow.
Speaker 4 (18:49):
Yeah.
Love to, he proposed to me acouple of years in, we just, we
were having this amazingly goodfather, son, mentor, protege
kind of relationship.
And he's an, and I am a, I'm alearning spot.
It's just my nature.
(19:10):
I don't, I don't care much.
I never cared much for theeducational mode of doing it,
but when it's, because I want todo it, um, just, I just eat it
up and he could tell I waseating up everything we were
doing.
And he said to me, a couple ofyears in, you know, you can, you
should buy this company from, hewas mid, early sixties at the
(19:33):
time.
I said, Whoa, what do you meangoing to come from?
Literally, I was just scared todeath.
My, my wife and I had justscrapped it, scraped together.
Some money with her sistershelped to put a down payment on
a little house and putting, youknow,$20 a month in 401k plan
(19:53):
was like a mind blowingexperience.
It was just my level ofsophistication wasn't high at
that time.
And he said, well, just relax.
It's okay.
There's plenty of time.
Don't worry about it.
So some time went by and hegroomed me and we he's, uh, he
consciously walked through thesuccession conversation with
(20:18):
other clients and me and, and mewith them and invited me to
participate in that kind ofconversation with other clients.
So it became about other peopleand how to other people solve it
.
And that taught me one of theprinciples that he really
(20:39):
preached when it got serious.
And that is, he said to me,look, don't worry about it.
The business will by itself.
What do you mean?
He says the cashflow is going tobe there the day after I retire.
Just like it's going to be therethe day before I checked.
Where's the cashflow goingtoday, going in my pockets,
(21:00):
going in your pocket the dayafter I retire, that'd be more
going in your pocket.
I said, huh, like that.
Right?
And you're going to take some ofwhat was going into my pocket
and keep paying me and I'm notgoing to work.
And I said, Oh, he says, that'show the business buys itself.
(21:21):
Every business buys itself, meand sold his lumber brokerage.
And that's where he startedlearning this lesson.
He had sold his truck and that'salready learned this lesson.
Almost every business is tightactually.
And very few businesses are thatmarket.
(21:42):
And once you get clear on thatidea that the whole media frenzy
over IPOs and venture capitaland all of that stuff, that's a
very, very small part of thebusiness.
You can reverse most businessesthese days, especially are not
(22:03):
built around machinery and bigplants and big real estate
holdings.
Those companies are in adifferent universe than most of
the business universe.
Most businesses I learned overthe process of writing this
book, average 10 employees wow.
And their intellectual propertybusinesses.
(22:25):
So they're not really a role,even a roll up opportunity.
In most cases.
Now there's some exceptions, butfor the most part, they're not.
So this is the principle of himteaching me the business buys
itself, the business to do thathas to have continuity.
The owner who is leaving has to,has to be careful enough that
(22:50):
they get enough money.
That it's good for them on theback end, but not take so much
that it collapses the businessdoes if it does, if it's so much
for the buyer that it's reallynot worth it to hassle with the
virus, then what is the formerowner have nothing.
(23:12):
Now what most advisors tell alot of small businesses to do?
These are the CPAs, the lawyers,the valuation guys just
liquidate.
Well, if you've got some stuffto real estate, I mean, it's a
retail store and you have someproduct on the shelves.
You have a blowout sale storeclosing.
(23:35):
And so off all the furniture andall this stuff off the shelves
and, you know, put up a hundredor 200,000 or something in your
pocket, pay off the tradereceivables or payables.
You have a little money left.
That's, that's common advice forsmall business continuity, which
(23:57):
is what that taught me is muchbetter.
So I took that, uh, took thatlesson to heart.
It gave him 15 years of, ofadditional retirement security.
It gave me a lifetime career andit built the idea in me that we
could do this again.
(24:19):
That's how I got started on the,on the writing the book.
Speaker 2 (24:24):
Oh, fantastic.
Yeah.
And I think that translates sowell to, uh, as you know, the
insurance industry, because, youknow, there's so many small
operations, you know, be it adirect sale agent to a broker
MGA, whatever title you want touse.
(24:45):
Um, there, there's so many smalloperations that are operated by
one or two people, and that'salways, you know, the question
how, you know, at some point,how do I separate myself from
the business, but also continue,uh, the business for next
generation to continue toservice the clients.
And I think, you know, that'swhere, you know, solutions you
(25:07):
offer with the ownership laddercome into play.
And you know, so how did you,uh, evolve the idea to where you
were able to sell your businessand develop the concept of the
ownership ladder?
Speaker 4 (25:23):
Well, it took a mere 30 years next success musician.
Who's got gray hair suddenly.
They're no.
And right.
So I hired somebody 10 yearsbefore I ultimately sold her.
And my reality was, as Imentioned, my two kids, we
(25:46):
adopted two girls from Chinawere late bloomers.
I was 50.
My wife was 49.
They're now in middle school andhigh school, our son who was 12,
when I married, my wife is justnot a business guy and no
interest in it.
Never showed any interest, nevermentioned any interest.
(26:09):
And so a family succession wassimply impractical.
My girls harassed me today.
Hey God, how come you didn'tkeep the business?
So you could hand it down.
I said, well, you know, I'd be,I'd be a geezer by the time it
would behave in near ready andthe business might not exist in.
So in my fifties, I started torealize that this preaching, we
(26:35):
had always done with ourclientele.
And I, even though I had pensionbusiness, 401k business health
and welfare benefits, I always,uh, continued because our
clientele was small business,continued to talk about
succession planning and buysell, and that sort of thing
with our clients and ensure thatthose needs.
(26:58):
So as my protege, Mary startedto grow in the business.
It started to become clear thatshe had definitely longterm
commitment to this as a career.
This was not something she wasdoing for a job career to her.
And she took it seriously andshe worked very hard and she
(27:23):
contributed a lot.
And so it becomes, and I thinkthis is for your list, who are
the owners?
If I waited until I'm 64 andabout a month, if I waited until
now to say, I didn't get it, Ididn't get a retirement thing
going on here.
Social security is coming nextyear.
(27:44):
Maybe, maybe a couple of yearsfrom now, I should think about
no the time that they need tothink about it.
At the time I started thinkingabout it was in my fifties.
And I started realizing thatthere were some roll-up
opportunities and I exploredone.
And did the, did the math on it?
Well, I don't want anything todo with that.
(28:07):
You know, one of the thingsthat's interesting about, I
think a lot of us, smallbusiness entrepreneurs, if we
become unemployable, becausewe're used to doing it our way.
And that's the problem with alot of M and a situations is
that the new owner you're nowtheir employee.
(28:28):
They said, well, you're going tobe a consultant.
We need you to stick around fora couple of years.
You're their employee.
That's just really a difficultposition to be in.
So I began to work with Barryand bring it up to her.
When I get ready to retire,let's figure out how to transfer
(28:49):
options to you.
She was in.
And so we had created this wholefancy complicated ownership
transition program where she wasgoing to do an earn it.
And I was going to do a workoutand I would work until I was 70.
(29:09):
Well, about the time that wasall happening, we literally had
signed papers.
It was all ready to go.
The loitering was done.
We went and called on a newprospect, pretty significant,
uh, international company andpitched them on their us 401k
operations.
And they said, yeah, you'rehired.
(29:32):
Awesome.
So we're meeting with the HRpeople in early in the
relationship to talk about howwe implement our system.
And we send, by the way, we cando your forum or your health and
welfare benefits.
They should know.
So well, yeah, we do that.
They said, no, you'll never dothat.
(29:55):
We'll never do that.
Right.
Roger and candy do that.
And they'll do that for us.
So let's talk about four.
Oh, by the way, he's not gettingany younger.
Maybe you should talk to him.
I had, I had a lot of work wherethere aren't that many huge
cities in the U S Portland,Oregon is not a huge city, so
(30:19):
everybody knows everybody.
So I had known Kim.
And so I called him.
I said, let's have much.
And I said, have you everthought about, you know,
retiring?
He said, yeah, actually I have,I just don't quite know how I'm
going to go about it, but I havecandy.
And she's, she's the one I'vetold her all along someday,
(30:43):
you're going to own this.
And I said, well, how bet if wefigure out how to do that?
And he says, yeah, I'd lovethat.
So I came back to the office andI said to Barry, this was not on
the plan, but it's howserendipitous life is sometimes.
Right.
I said, you know, there's thisopportunity for us to merge with
(31:03):
this other practice.
And, and so fitting into theten-year plan we got going on.
That could be really good, butif you hate her, this is not
going to work at all.
So why don't you go take her tocoffee and just talk and see if
you guys like each other?
Well, not only did they likeeach other, they were just this
(31:26):
train that suddenly was loadedand rocketing down the tracks
because they could both see shehad candy, had had promises made
Mary and a deal, both see thatthe opportunity was to put this
together and have a reallysignificant business.
(31:47):
So we literally, within monthshad merged the businesses.
And, and as I went through theprocess of that, I realized, you
know, the math doesn't work forme to be a principal in the
benefits business.
The math works for me to sellthem my benefits business and
(32:09):
let them buy his benefitsbusiness.
Then Barry and I will keepworking the retirement business.
And so that's, that was thestarting point rather than
occupying, Oh, the air time.
I'm going to let you pose aquestion here.
Speaker 2 (32:28):
Well, you know, um, you know, I'm curious, I, can
you get into, um, this, this isfascinating because I know this
is a huge issue for so manypeople in the financial services
industry.
Can you talk a bit about themechanics of how it works?
Uh, the ownership.
Speaker 4 (32:45):
Yeah.
So, as I mentioned with my dad,it really is a matter of the
owner being rational about thefinancials.
Okay.
There aren't that many smallbusinesses that are that liquid
that just happen to have a keyemployees who have a spare, a
(33:07):
hundred thousand bucks in theirpocket, right.
Just everybody is living well.
Well, we live well and we dowell.
We still, from a certainperspective, live month to month
monthly mortgage, we got monthlygroceries.
We got kids who have schools,situations, we've got new cars
(33:28):
to buy insurance premiums to payall of that stuff.
Right?
So that the owner has to startfrom the point of view of taking
off the, um, the filter thatsays, I have to get all my money
up front that's number one, yougo at it with that point of
(33:51):
view, you probably will haveyour business die, and then you
will die and you will both beold and there will be nothing
left.
And you will have had to work inyour business for 20 or 30 more
years.
So if you let that go, you canstart looking at well.
So how could we make this workin, in my dad's case?
(34:15):
And in my case, I didn't requirea down payment and required
monthly payments.
And I, you just have to do thespreadsheets and say, what's
the, what's the predictable cashflows of the business.
What is a good owner'scompensation?
Maybe not what you're taking outof the business, because if
(34:36):
we're successful, we're takingout quite a lot.
And we said, well, that's myjust compensation, but really
there's a lot of profit on topof the actual work based
compensation that you're takingin most cases, because, you know
, in the 401k and pensionbusiness, one of the things that
(34:56):
was just part of the job of theconsultant was to know what
everybody got paid, why?
Cause non-discrimination testingrequires that as part of the
form pillar.
So I saw pet owners in almostevery business make a lot of
money.
So you gotta, you gotta go fromthe point of view of, well, you
(35:18):
know, 400 is my number two.
Yeah.
But the business can't pay me400 and keep going with a new
owner.
What are they supposed to dolive on 40,000 a year for 10
years while you get your 400,you know?
So you have to get over that.
That's really part of the hurdleas a seller is what's it?
(35:42):
What works?
Think about it as a what workssituation.
What is, what is the businessneed to keep functioning and
running on all cylinders?
What does the new owner need tomake it?
So that screwing it up is wayworse, way worse than the great
(36:06):
situation of keeping going isthey're in a good situation.
They will never screw it up.
Why would that, and then, thenyou figure out based on those
two factors, how much can thebusiness sustain and pay me?
What's the value of thebusiness?
So therefore, how many years isit gonna take?
I don't, what did I do?
(36:27):
I gave him 22 years.
Why 22?
Because that's how the mathworked out well for everybody
there, there they are alreadybecause they combined the two
businesses and because of their,their young age and they're
right, they were right at thepeak influential point in their
(36:50):
career, my two buyers.
And so what have they done withthe business?
It's vastly bigger than I evercould have, did make it.
And so my financial security is,um, um, a, I'm still a number
significant to their formula,but I'm not pigging out on their
(37:18):
revenue and their work in such away that it's at all hard for
them to continue to run thebusiness and keep paying.
Meanwhile, my family and I getto live a pretty comfortable
life because of the combinationof our other.
I mean, that doesn't mean anowner doesn't have money in 401k
and other investments do otherplanning.
(37:41):
Can't thank you for yourbusinesses, your whole
retirement, but as a core, it'syour major investment?
It's your major asset?
Speaker 2 (37:52):
Well, I think actually that is an amazing
point because, you know, as Iwas thinking about it is, you
know, the way you describe it,it's almost an annuity for you.
Speaker 4 (38:05):
It isn't, I love annuities by the way.
Speaker 2 (38:09):
I, I think annuities, you know, have gotten a bad rap
overall, you know, um,unfortunately some companies
have twisted them and earnedthat reputation.
But I think the concept, youknow, especially in this, uh,
type of scenario is, is awonderful way.
It works for everybody.
But I think the core value thatI'm hearing from you is that you
(38:31):
can't be greedy.
You need to be realistic and toshare, um, you know, maybe that
principle, you know, I don'tknow if you remember that, all,
everything I need to know, Ilearned in kindergarten, you
know,
Speaker 4 (38:50):
Being stupid on either side of the equation,
that's where it takes thespreadsheeting.
You'll have to either hireyourself a spreadsheet or you'll
have to train yourself to be aspreadsheet.
Or maybe you are one, but that'sthe way you can just tinker with
the numbers.
And it's a lot of people want tomake business transactions, you
(39:13):
know, fancier than that.
But really it's a matter of thebuild a spreadsheet.
You see how the numbers flow andyou watch it, you say, does this
work on all sides of theequation?
If it does.
And it works well, then it'slikelihood is it's going to keep
(39:33):
working if you've, if you, sothe other piece of this equation
though, is it's, it's a reallyimportant part.
It's mentoring the success.
A lot of people think, well, I'mgoing to sell it.
There'll be, you know, they'remy kid.
They'll try.
I trust them.
There'll be good.
(39:54):
Okay.
That might work.
And then many cases it does, butin many cases, it doesn't.
And it's really a matter oflooking at that whole person and
saying, are they reallycommitted to the whole package
here?
Did the kind of business we'rein to perpetuating this
business.
Do they have a vision for whereit should go?
(40:17):
Because a lot of us tend tothink, well, I know that at all.
No we don't.
So when it's time to get out ofthe way, if they really have a
passion, they that business,because it's this really nice
platform we've built up over theyears, I took the platform, my
dad built and built it manytimes bigger.
(40:41):
They are taking the platformthat I built and the project
bill and taking it way manytimes bigger than that.
And ideally few years down theroad, they'll either they will
have grown it to the point wherethey really are an acquisition
target at a certain scale.
Businesses become acquisitiontargets, but they have to be of
(41:06):
a significance that the buyerreally sees a financial asset at
that point, not just a, youknow, that's one of the things I
talk about in the businessbeyond the, that is really part
of this mentoring equation.
I think it is a mentality of anowner that is looking for an
(41:29):
angel buyer, like, like the techget angel investors and angel
buyer is a fantasy for mostbusinesses.
Why?
Because an angel buyer and a 10person business, the owner has
to work.
Then an angel buyer never wantsto work.
(41:51):
They want to give you 500,000bucks.
And in five years they want 5million back and they don't want
to work.
They want to walk in and say,what the hell are you doing?
Do it better.
And walk out and wait for their5 million to come.
So they can take that 5 millionand buy five more businesses
each where the million and dothe same thing.
That's their mentality.
(42:12):
Most small businesses need aperson that works.
So as you're mentoring yourperson, that's really the
equation to be looking at.
Are they, are they a worker?
A lot of people like to use theword I'm an entrepreneur.
Well, you know, entrepreneurs,they startup mentality.
(42:33):
After, after a couple of yearsof entrepreneurs, if you don't
have going business concern,that is a business, then you are
a business owner, but you reallynot.
It's not a thing, right?
Entrepreneurship is not really athing in my book.
Ownership is a thing.
(42:53):
That's why I called it theownership ladder, because that
will, entrepreneur's a greatbuzz word.
Everybody likes, especiallypress.
They love that.
They love to talk about it.
Colleges like the teacher,entrepreneur classes as well.
I think they should teachbusiness owner classes because
that's where most of theactivity and the universe is
Speaker 2 (43:14):
Definitely.
Well, I think one thing is I'mnot going to tell entrepreneur
magazine about this interview.
It may be highly disappointed.
Speaker 4 (43:23):
They asked me to write an article or I get to,
you know, I'm gonna, I'm gonna,I'm gonna spin it a bit
different.
Speaker 2 (43:30):
So, you know, um, have a couple wrap-up questions,
but I, I think a big one is, um,a lot of people in the insurance
nerds audience are younger intheir careers.
So how can they positionthemselves?
You know, to be the type ofperson who could participate in
an ownership ladder typesituation, what advice would you
(43:52):
give somebody who's young?
Speaker 4 (43:54):
Yeah.
Uh, I saw it often.
I never, I never did it myself,but there are, um, there are
people who are, and I've seen itin the securities business more
than I've seen it in theinsurance business, but a person
with a book of business who isgetting ready to retire and a
(44:17):
young business owner who isbuilding their business.
If they think of an ownershipladder in the context of
themselves, rolling up abusiness and saying, Oh well,
there's agency down.
The street is a good guy.
He's got two or three people andobviously drive a nice car.
(44:37):
And he lives in a nice part oftown, probably successful.
And he probably wants to retireat some point.
And in the same token, as we'vebeen talking, his opportunity to
be rolled up, he may not be thatbig.
You may not be that significantin a, in a, you know, you need
(44:59):
to be there talking to yourclientele on a one-on-one basis
to keep the trust.
This younger person can think ofit in that, that they could
acquire other books of businessthrough understanding the
ownership ladder and being, evenif they don't work there or they
(45:19):
don't work there for a longtime, they could use the ideas
here to position themselves withthose business owners.
The other thing that isimportant, I think for younger
business, people to do is, istake every action in the
business that is designed with amentality that I am growing at
(45:46):
business to be a longterm asset.
I'm not getting next months, carpayment, where this transaction
I'm building my business.
And as I build my business, I ammaking a marketable entity and a
marketable organization.
So what does that mean?
(46:06):
I gotta have good records.
I gotta maintain financials ofthe business that are completely
separate from my own.
I have to hire professionals tomake sure that my, my legal, my
accounting, my, uh, operationalfunctions are really
well-defined.
(46:26):
So that over time as you build,because businesses gained value
by having pro that's it becauseit's, it's a mental, I mean,
it's mostly mental assets, sowhat's the proof.
Well, you've got a track worker,you've got clients.
If you have a great CRM thattracks all of your client
(46:48):
relationships over time, thosebecome part of your marketing
package.
And then as you grow older andyou start to see yourself as a
mentor role, your own personalMary and candy and practice so
that they can be com owners.
And frankly, if you, it was trueof me, I guess, a lot of frogs
(47:11):
throughout the process of tryingto find the succession part,
kept doing it for quite quite alot of years, bringing in people
thinking, well, this will be apartner.
Eventually they'll buy the out,uh, be ready to say, eh, you're
out.
Speaker 2 (47:32):
Uh, I think that that's an important point is
that it is about the fit.
Um, and, and this is sointeresting.
There's, there's so much toexplore here and that I, I think
this is going to be extremelyhelpful to those in the
industry.
Um, you know, either own theirsmall agency or brokerage, you
(47:53):
know, whatever operation thatthey have and are looking, you
know, a lot of us in theinsurance industry are graying
out and, uh, you know, it's timefor a new generation.
Uh, I think the insuranceindustry is kind of hitting a
refresh point.
I, you know, you share thatview.
Um, you know, the, the questionI always like to wrap up with is
(48:16):
do you know, getting your numberone tip on being financially
prepared, you know, what haveyou learned and what would be
that one tip that you wouldleave, you know, either
consumers or advisors with,about being financially
prepared,
Speaker 4 (48:31):
Put your money in your 401k too.
Speaker 2 (48:35):
That is excellent because I think that's something
I can't remember the statistics,how much, how many people don't
take advantage of the 401kmatch.
And that's something I couldnever understand walking away
from that free money.
Speaker 4 (48:47):
Exactly.
Well, and if you're the owner ofthe business, you have to, you
have to create a 401k and itcosts you money to do it, but
the longterm benefit of that toyou and to everybody else,
because you don't get to justcram in all you want without
bringing your folks along.
(49:08):
And that's just that that's thenon-discrimination rules that
are existing and they're fair.
They're right.
So build your plan so that it,it makes it possible for you to
maximize it for yourself so thatyou have it's, it's one of your
multiple assets that you canrely on for your monthly
(49:31):
paychecks when it comes time.
Speaker 2 (49:33):
Boy, that sounds really close to the concept of
the ownership ladder.
Speaker 4 (49:39):
The whole thing is really, really tied together.
They, they, there are, you know,when you brought up annuities
earlier, I'm just gonna refreshon that for a moment.
Social security really isn't anew 401k, regardless of how you
extract the money from it reallyisn't an annuity, your ownership
(50:02):
in the business and the way youfinance and help the person
finance the exit is an annuity.
But I can guarantee you,especially as an early retiree,
because, uh, because healthinsurance costs continue family
that costs of an old guy buyinghealth insurance is ridiculously
(50:23):
expensive.
You need a pretty healthyannuity to, to go buy yourself
some health insurance, if you'regoing to early retire.
So, but my advice actually is totry to stick it out till you're
60.
I mean, 65, excuse me.
I was 60 when I exited and itwas the right thing for my, my
(50:45):
people, my buyers, I was in, Iwould have been in the way if I
had stuck around and reallydistracted from and detracted
from the success of thebusiness.
So I did, but from a financialpoint of view, if you can find
somebody else to pay your healthinsurance, like Medicare, that's
(51:05):
a good thing, putting a pitchfor some of those politicians.
Speaker 2 (51:12):
Well, I think, you know, it's unfortunate.
I know, you know, in, in workingwith financial planners, you
know, over the years andconsulting for them, that health
insurance is always one of thebig topics for people is, you
know, what do you do with thathealth insurance premiums in
retirement?
And, you know, pre-retirement,um, anyway, um, thank you so
(51:35):
much for coming on today.
Um, where can people learn moreabout you and the ownership?
Speaker 4 (51:40):
So I'm going to grab a copy.
So the book cover, which you seehere is changing on amazon.com
because Amazon's background iswhite.
As I discovered after Ipublished it and this book cover
while beautiful, and I love thishandshake, it's just, it's so
(52:02):
significant, but it doesn't popoff of the page of Amazon.
So the new book cover, don't belooking for this cover.
When you go looking for theownership ladder, you will still
find the ownership ladder, butit will be mostly orange with a
kind of a, a torn front icon toit.
And, um, so you go to Amazon andbuy the book.
(52:27):
If you are an Amazon, a Kindleunlimited reader, you can read
it for free.
I have heavily discounted rightnow, so you can get a copy of it
for a very low price.
I would love to have peopleconnect with me on LinkedIn.
So bill he, Stan H E S T a N DLinkedIn slash bill.
He stand connect with me.
(52:49):
That's where I do a lot ofcommunicating on part of a bunch
of different groups.
And I just enjoy participatingin those groups on my website,
the ownership ladder.com.
You can join the mailing list.
You can get a free copy of thesummary version of this book,
which is basically all of the,all of the section summaries.
(53:12):
Each of the groups, there's foursections in the book.
And so I presented each of themwith a summary section.
So if somebody wants a quick andeasy overview of the book, join
my mailinglist@ownershipletter.com
Speaker 3 (53:26):
And you'll get emailed a PDF of that.
You want to buy and go toamazon.com and buy and pay me
money for it.
But
Speaker 2 (53:36):
Well, and for our listeners, all that, you know,
in case you didn't have your penout, or you're listening to the
song to go is all the links willbe in the show notes.
So you can just, uh, you know,enter convenience, uh, check out
the show notes and find outdifferent ways to connect with
bill and find out what he's upto.
Uh, bill.
Thank you so much for joining metoday.
It's been a real pleasure.
Speaker 3 (53:57):
Oh yeah.
I've really enjoyed it.
Great conversation.
Hopefully it's helping somebody.
Speaker 2 (54:02):
I think it'll help a lot of the audience out there.
Welcome to the get ready podcast in partnership
with a church nerds today, I'mpleased to be joined by bill
Houston.
In this episode,
Speaker 2 (00:22):
We'll be discussing how to set up a successful
internal business transfer andsale along with succeeding in
the financial services industry.
Bill's an author, entrepreneurand small business expert during
his 32 years as a businessowner, bill grew a company
specializing in highlycustomized retirement health and
(00:43):
welfare benefits and businessplanning for client companies
and their employees in 2017,bill retired and relocated to
Texas after closing the internalownership ladder sale.
This company following more thana year of taking stock
reflection and fun.
Bill created ownership ladder toshare the mindset in life
(01:04):
treaties to help potentialintrepreneurs to the life
they've been dreaming about.
Bill has been a frequent speakerat financial services conference
on topics such as building yourpractice retirement income and
using technology.
Bill also served as a member ofthe committee for the fiduciary
standard.
Good morning and welcome bill.
Speaker 3 (01:25):
All right, again.
Good morning.
How are you?
Speaker 2 (01:27):
I'm doing well.
Thank you for joining me.
Uh, looking forward to thisepisode.
Fantastic.
Well, let's, uh, talk a littlebit about who you are.
What do you do?
Speaker 3 (01:39):
Great.
Well, I am, I continue to behappily retired, although I am
fully engaged at the same timeand promoting my book, which is
my current life passion.
I'm a member of two Toastmastersclubs.
I have a middle school girl anda high school girl, and that, uh
(02:02):
, transportation activity keepsme quite busy.
And so I have a full life.
My wife is out in the other roomtrying to keep the dogs under
control so they don't try tocome and lick us while we're a
product podcasting today.
Speaker 2 (02:19):
Well, special guests, right.
Speaker 3 (02:22):
Actually.
Speaker 2 (02:25):
So fantastic.
Uh, well, glad that you'veturned the page to a new career.
Um, so, you know, let's, let'sgo back to the start just to, so
people can find out who you are.
Um, how did you get started inthe insurance business?
Speaker 3 (02:40):
Well, it was a circuitous route.
I didn't aim for the insurancebusiness for our financial
services or even for businessitself.
I was as a teenager recruited towork in a speed shop because the
owners knew my parents and theysaid, Hey, bill is pills kind of
handy.
(03:01):
And he puts them in for us andthey taught me how to, how to
put bikes together one summerand kept me on.
And so I spent quite a few yearsin the ski business advantage to
ski shop, came back, got a jobat another ski shop, met my
first wife and she said, Hey, Iknow about, uh, some friends in
(03:24):
Hawaii, we're going to start ahealth food store.
Let's go home.
So we ended up going to the bigIsland of Hawaii, the very
Southern most community in theUSA called Leighton and start at
the Southern most health foodstore in the USA in 1979.
(03:44):
And after cleaning refrigeratorsand sweeping the floor for a
couple of years, I realized thatwas not all that, just not all
that at all.
We gotta go, we gotta go back tothe main land.
So back we came and my brothersaid, so what are you going to
do?
Then?
I said, I don't know.
And he said, well, what'd youget a job as a bank teller?
(04:06):
You can count, catch it.
I said, yeah, I could count.
So I got a job as a bank tellerand, and they found me to be
interesting enough that they putme on management training pretty
soon.
And then I was old enough to askthis question and my dad and we
went skiing one day.
And when I got into bankingsuddenly, and I could start
(04:28):
actually conversing havinginteresting conversations before
he was a capitalist pig and Iwas not.
And whatever he was doing well,then I'd grown up enough.
And we went skiing one day and Isaid, Hey dad, what is it you do
exactly.
And he spent the day regaling mewith stories, sell agreements
(04:51):
and employee benefits.
And there's new fangled thing.
It was 1984.
He had just been to the milliondollar round table.
And this was his third career.
He owned a lumber.
He owned a short haul truckline.
He sold it and retired for alittle while.
And then a friend said, Hey,come take over my dad's pension
(05:12):
business.
And, uh, so we spent that daylearning, uh, him teaching me
about this new fangled thingcalled a 401k plan, which you
just heard Tim Dennis speak ofat the table.
He was teaching, you know,unveil, unveiling it to the
world.
(05:33):
A few people like fidelity thisnew mutual fund company back
then and, uh, started to getsome traction with it.
And we started to do thatbusiness together after I said
at the end of that day.
Wow.
That is so cool.
What you're doing?
Can I join?
You heard of question in thefamily really that the least
(05:55):
likely person to go join and hisbusiness was me.
So, so that's how I got involvedin the insurance business.
It was much more interestingthan banking and here I am.
Speaker 2 (06:10):
Wow.
Yeah.
Well, you know, I'm stillwaiting for that first person to
tell me that, that they grew up.
Oh, I'm getting a little bit ofan echo,
Speaker 3 (06:21):
Um, from my side or from you,
Speaker 2 (06:25):
Uh, for me, I think it's gone away.
Uh, uh, let me make a quick noteof the time so we can have this
edited out.
Sure.
Let's see.
Where are we in the video time?
Speaker 3 (06:39):
Technology is great until it's a pain.
Speaker 2 (06:42):
Yeah, let's see.
We're about seven minutes in thewater here.
Yeah.
I'm still getting a little bitof the echo.
Um, I'm gonna just mute andunmute real quick.
Okay.
Speaker 3 (06:54):
Yeah.
Speaker 2 (06:59):
Okay.
Let me see.
Okay.
It seems to have gone away ifit, if it comes back, I'll just
get rid of the headset.
Um, so anyway, so let's, uh,punch back in.
Um, so I'm, I'm still waiting tomeet that first person who says
that that was their big dreamgrowing up to come into the
insurance business pretty much.
(07:22):
I'm sure.
You know, you've been doing thisfor awhile.
I came into the industry aboutwhen you did is pretty much
everybody I've talked to justsort of fell into the insurance
business in some way or another.
Um,
Speaker 3 (07:34):
Politically right before I got into the got hired
by the thing I applied to thiscompany called Phoenix mutual
and they gave me their tests andI said, no, you're totally
unsuited for this business goaway.
Speaker 2 (07:49):
Oh, I remember those old tests that they had at the
arts agencies.
They weren't very good atpredicting anything, but people
really believed in giving them.
So anyway, you mentioned, um,the million dollar round table,
and I think that's, you know,maybe, um, a lot of our lists
nearshore and their property andcasualty industry, uh, the
(08:09):
million dollar round tables, uh,uh, uh, organization on the life
insurance side that you qualifyfor by, uh, placing a lot of
business.
And it's a huge honor to qualifyand bill you've qualified for
both the core to the table andthe top of the table, which is a
very exclusive number of people.
(08:31):
Uh, the qualify for that.
What is your secret to success?
What, um, got you up to thequarter table and top of the
table,
Speaker 3 (08:39):
You know, it was interesting that I just worked
the business.
It wasn't really a strategicplan of mine to get the core to
the table or top of the table.
It was more my plan to grow thebusiness
Speaker 4 (08:56):
And do what we were doing in a better way each and
every year.
And by doing that, just workingthat idea and that kind of, from
that kind of thinking ithappened.
And, and I, a lot of milliondollar round table folks are
(09:16):
probably shrugging at thispoint.
You know, I had to strategizeand decide how to do it and get
there.
And that just wasn't really myplan.
My plan was to work the businessthat I had purchased from my dad
and grow it and make it reallymore significant.
Speaker 2 (09:38):
Well, that's great.
And I think that's an importantlesson for our listeners is, um,
getting the feedback again, I'mgoing to just pause the
recording for a second.
All right.
So yeah, I, I think that's agreat point that you make that
it's really not aboutconcentrating on, uh, focusing
(09:59):
on the end result, but onserving your clients and on
growing your business andworking your business is, you
know, if you keep an eye on yourbusiness is, you know, good
things will follow if you dowhat you're supposed to do.
Um, you know, so in addition tothe sales success, um, you
served as a member of thecommittee for the fiduciary
(10:21):
standard.
Um, how did you decide to getinvolved with it?
Speaker 4 (10:26):
That was, uh, an interesting transition.
I was, uh, we had, we had asignificant amount of pension
business as well as 401kbusiness, which is kind of a, an
odd thing since pensions are afading reality except in the
public sector.
(10:48):
And I, one time I got fired andwhy did I get fired?
Because a guy came in and theymade a pitch that was totally
based on fiduciary concepts anda fee-based, uh, fee structure,
(11:09):
as opposed to a commission-basedstructure.
We came up in the trendsbusiness.
So we were commission oriented,and this was a large enough plan
that I stood the, the insurancecompany that had, that kept the
business.
Since they didn't have to paycommission, they could pay
whatever fee, whatever.
I started working with thewholesaler, and I said, what
(11:32):
gifts?
And he said, well, you got toconvert to a fee-based business.
That's where it's going.
And I said, okay, that's whatwe're doing.
And in order to charge a fee,you have to take not, not just
the insurance test and not justa securities brokers test, you
have to take an investmentadvisors test and get certified
(11:55):
as a registered investmentadvisor.
Then you can declare yourself.
And it desperate fiduciary onthe, uh, on the investment side,
which is now the norm inretirement plans, nearly
everybody who is, who is asignificant player in retirement
plans is an investmentfiduciary.
(12:17):
And so, and just as part ofthat, I started, uh, becoming
it's a joke.
So hopefully nobody will take itthe wrong way, but I became a
fiduciary Nazi kind of like asuit Nazi on Seinfeld.
You know, if you, if you weren'tthat you just
Speaker 2 (12:36):
Shoot, I'm not having a good morning here on the
recording.
Sorry about that.
Speaker 4 (12:42):
Okay.
Well we're all back.
Is that like water all over thefloor or coffee?
Speaker 2 (12:49):
Yeah, no, it was, uh, a water bottle.
I was trying to adjust mylighting.
Um, sorry
Speaker 4 (12:54):
About that.
Speaker 2 (12:58):
All right.
Let's, uh, pick up.
Um,
Speaker 4 (13:03):
So I became, I became like the soup Nazi on Seinfeld,
where if you weren't afiduciary, you really weren't
seeking the best interest of theclient on the retirement plan.
And that was probably halfwayinto my career.
It was, it was probably now 20years ago.
(13:24):
And as I gradually migrated ourbusiness from an investment
commission-based business to aadvisory fee-based business,
where we were a fiduciary oneverything to take on that kind
of liability, that the lawyerswho, who teach on the subject at
(13:45):
the retirement plan meetingssay, well, you are liable right
down to your cuff links.
Since I don't wear cuff links, Icouldn't afford to lose them,
began to educate myself.
And the committee for thefiduciary standard is, was, is
one of the advocacy groups thatsimply says, if you're doing
(14:07):
retirement plan business, youshouldn't be doing it unless you
are accepting the liabilitiesthat go along with the advice
you're giving.
Speaker 2 (14:18):
Definitely what, you know, it's, it's something I,
you know, I wrote an article in1995, um, Fran bestie, you know,
stating that, you know, mythought and this was with
another, uh, insuranceconsultant that the days of
commissions were numbered in theinsurance industry.
And, uh, that day has not comeyet.
(14:39):
Um, but you know, the work thatis done by the committee on the
fiduciary standard was amazing.
Um, but you know, it, it seemslike it's kind of faded into the
background.
I mean, given the currentregulatory climate, do you think
it's going to make a comebackthat whole thought pattern of
moving to more fee-basedproducts and advice?
Speaker 4 (15:03):
You know, the distinction between an insurance
commission and an investmentadvisory fee is quite different
pricing.
When you look at the pricingformulas for an insurance
product, if you charge a fee orif it, if they amortize a
(15:23):
commission and the numbers don'tchange that dramatically, but in
an investment in the investmentworld, they do change
dramatically because everythingis real time in the future, 5%
upfront mutual fund commissionthat comes right out of the
consumer's pocket.
If you charge 0.2, 5% over time,that comes out of the consumer's
(15:48):
pocket too, but it's anamortization on the advisor's
part.
And it demands a definiteservice package that is
explicit, that is understood byall parties.
And it's an accountabilityfunction, how to translate that
(16:08):
into the insurance world.
I think it's probably easier todo though.
I don't know that much about PNCpricing, but it's possibly
easier to do there than it is onthe life and annuity side there,
because the one, a auto policyfor example, is a one-year
(16:30):
transaction, w the broker and Ihave to decide, well, is that
the right company to stay withfor next year?
Usually it is, but if some otherpricing comes in, there's really
no cash value.
There's no future value.
There's no surrender charge totake into account.
So it's a much more, uh, fluidkind of situation, similar to
(16:54):
investments.
That's where that's the parallelI see is that if I don't like
mutual fund a, but I want to bein the category that it's
covering international largecompanies, just as an example, a
fire them.
And I hire somebody else andovernight the money isn't the
new deal and the pricing isdifferent and the philosophy is
(17:15):
different, but I'm still in thecategory.
Similar auto insurance will firethem.
And overnight I'm with a newcompany, I still have coverage.
I can drive and not be exposedto, you know, unlimited
liabilities if I didn't haveinsurance.
So kind of the parallel I'mdrawing with life insurance, the
(17:37):
longevity is of the policy mightbe 50 years, the amortization of
a commission over a 50 yearperiod of time.
It irons out to be a relativelytiny number.
And you really wouldn't want tocharge a fee to a, to a consumer
that is equal to the fee or thecommission that is paid on a
(18:02):
life product or an, or along-term care long-term
disability.
That kind of thing.
Speaker 2 (18:08):
Definitely what I'm sure we can cover a whole
episode, Justin, with that.
Those are some great points init.
And you know, that probablyanswers the question of why, at
least in the life insuranceside, we haven't seen those
types of products succeed.
A number of companies havelaunched different, no load and
low load concepts, and they justhaven't caught on.
(18:29):
Um, so let's, uh, transitioninto what you're doing now.
Um, you know, I, I, I'd like togo back to 30 years ago where
you purchase a business fromyour father, cause you know, to
talk a little bit about whatthat process was like and how
that led into what you're doingnow.
Speaker 4 (18:49):
Yeah.
Love to, he proposed to me acouple of years in, we just, we
were having this amazingly goodfather, son, mentor, protege
kind of relationship.
And he's an, and I am a, I'm alearning spot.
It's just my nature.
(19:10):
I don't, I don't care much.
I never cared much for theeducational mode of doing it,
but when it's, because I want todo it, um, just, I just eat it
up and he could tell I waseating up everything we were
doing.
And he said to me, a couple ofyears in, you know, you can, you
should buy this company from, hewas mid, early sixties at the
(19:33):
time.
I said, Whoa, what do you meangoing to come from?
Literally, I was just scared todeath.
My, my wife and I had justscrapped it, scraped together.
Some money with her sistershelped to put a down payment on
a little house and putting, youknow,$20 a month in 401k plan
(19:53):
was like a mind blowingexperience.
It was just my level ofsophistication wasn't high at
that time.
And he said, well, just relax.
It's okay.
There's plenty of time.
Don't worry about it.
So some time went by and hegroomed me and we he's, uh, he
consciously walked through thesuccession conversation with
(20:18):
other clients and me and, and mewith them and invited me to
participate in that kind ofconversation with other clients.
So it became about other peopleand how to other people solve it
.
And that taught me one of theprinciples that he really
(20:39):
preached when it got serious.
And that is, he said to me,look, don't worry about it.
The business will by itself.
What do you mean?
He says the cashflow is going tobe there the day after I retire.
Just like it's going to be therethe day before I checked.
Where's the cashflow goingtoday, going in my pockets,
(21:00):
going in your pocket the dayafter I retire, that'd be more
going in your pocket.
I said, huh, like that.
Right?
And you're going to take some ofwhat was going into my pocket
and keep paying me and I'm notgoing to work.
And I said, Oh, he says, that'show the business buys itself.
(21:21):
Every business buys itself, meand sold his lumber brokerage.
And that's where he startedlearning this lesson.
He had sold his truck and that'salready learned this lesson.
Almost every business is tightactually.
And very few businesses are thatmarket.
(21:42):
And once you get clear on thatidea that the whole media frenzy
over IPOs and venture capitaland all of that stuff, that's a
very, very small part of thebusiness.
You can reverse most businessesthese days, especially are not
(22:03):
built around machinery and bigplants and big real estate
holdings.
Those companies are in adifferent universe than most of
the business universe.
Most businesses I learned overthe process of writing this
book, average 10 employees wow.
And their intellectual propertybusinesses.
(22:25):
So they're not really a role,even a roll up opportunity.
In most cases.
Now there's some exceptions, butfor the most part, they're not.
So this is the principle of himteaching me the business buys
itself, the business to do thathas to have continuity.
The owner who is leaving has to,has to be careful enough that
(22:50):
they get enough money.
That it's good for them on theback end, but not take so much
that it collapses the businessdoes if it does, if it's so much
for the buyer that it's reallynot worth it to hassle with the
virus, then what is the formerowner have nothing.
(23:12):
Now what most advisors tell alot of small businesses to do?
These are the CPAs, the lawyers,the valuation guys just
liquidate.
Well, if you've got some stuffto real estate, I mean, it's a
retail store and you have someproduct on the shelves.
You have a blowout sale storeclosing.
(23:35):
And so off all the furniture andall this stuff off the shelves
and, you know, put up a hundredor 200,000 or something in your
pocket, pay off the tradereceivables or payables.
You have a little money left.
That's, that's common advice forsmall business continuity, which
(23:57):
is what that taught me is muchbetter.
So I took that, uh, took thatlesson to heart.
It gave him 15 years of, ofadditional retirement security.
It gave me a lifetime career andit built the idea in me that we
could do this again.
(24:19):
That's how I got started on the,on the writing the book.
Speaker 2 (24:24):
Oh, fantastic.
Yeah.
And I think that translates sowell to, uh, as you know, the
insurance industry, because, youknow, there's so many small
operations, you know, be it adirect sale agent to a broker
MGA, whatever title you want touse.
(24:45):
Um, there, there's so many smalloperations that are operated by
one or two people, and that'salways, you know, the question
how, you know, at some point,how do I separate myself from
the business, but also continue,uh, the business for next
generation to continue toservice the clients.
And I think, you know, that'swhere, you know, solutions you
(25:07):
offer with the ownership laddercome into play.
And you know, so how did you,uh, evolve the idea to where you
were able to sell your businessand develop the concept of the
ownership ladder?
Speaker 4 (25:23):
Well, it took a mere 30 years next success musician.
Who's got gray hair suddenly.
They're no.
And right.
So I hired somebody 10 yearsbefore I ultimately sold her.
And my reality was, as Imentioned, my two kids, we
(25:46):
adopted two girls from Chinawere late bloomers.
I was 50.
My wife was 49.
They're now in middle school andhigh school, our son who was 12,
when I married, my wife is justnot a business guy and no
interest in it.
Never showed any interest, nevermentioned any interest.
(26:09):
And so a family succession wassimply impractical.
My girls harassed me today.
Hey God, how come you didn'tkeep the business?
So you could hand it down.
I said, well, you know, I'd be,I'd be a geezer by the time it
would behave in near ready andthe business might not exist in.
So in my fifties, I started torealize that this preaching, we
(26:35):
had always done with ourclientele.
And I, even though I had pensionbusiness, 401k business health
and welfare benefits, I always,uh, continued because our
clientele was small business,continued to talk about
succession planning and buysell, and that sort of thing
with our clients and ensure thatthose needs.
(26:58):
So as my protege, Mary startedto grow in the business.
It started to become clear thatshe had definitely longterm
commitment to this as a career.
This was not something she wasdoing for a job career to her.
And she took it seriously andshe worked very hard and she
(27:23):
contributed a lot.
And so it becomes, and I thinkthis is for your list, who are
the owners?
If I waited until I'm 64 andabout a month, if I waited until
now to say, I didn't get it, Ididn't get a retirement thing
going on here.
Social security is coming nextyear.
(27:44):
Maybe, maybe a couple of yearsfrom now, I should think about
no the time that they need tothink about it.
At the time I started thinkingabout it was in my fifties.
And I started realizing thatthere were some roll-up
opportunities and I exploredone.
And did the, did the math on it?
Well, I don't want anything todo with that.
(28:07):
You know, one of the thingsthat's interesting about, I
think a lot of us, smallbusiness entrepreneurs, if we
become unemployable, becausewe're used to doing it our way.
And that's the problem with alot of M and a situations is
that the new owner you're nowtheir employee.
(28:28):
They said, well, you're going tobe a consultant.
We need you to stick around fora couple of years.
You're their employee.
That's just really a difficultposition to be in.
So I began to work with Barryand bring it up to her.
When I get ready to retire,let's figure out how to transfer
(28:49):
options to you.
She was in.
And so we had created this wholefancy complicated ownership
transition program where she wasgoing to do an earn it.
And I was going to do a workoutand I would work until I was 70.
(29:09):
Well, about the time that wasall happening, we literally had
signed papers.
It was all ready to go.
The loitering was done.
We went and called on a newprospect, pretty significant,
uh, international company andpitched them on their us 401k
operations.
And they said, yeah, you'rehired.
(29:32):
Awesome.
So we're meeting with the HRpeople in early in the
relationship to talk about howwe implement our system.
And we send, by the way, we cando your forum or your health and
welfare benefits.
They should know.
So well, yeah, we do that.
They said, no, you'll never dothat.
(29:55):
We'll never do that.
Right.
Roger and candy do that.
And they'll do that for us.
So let's talk about four.
Oh, by the way, he's not gettingany younger.
Maybe you should talk to him.
I had, I had a lot of work wherethere aren't that many huge
cities in the U S Portland,Oregon is not a huge city, so
(30:19):
everybody knows everybody.
So I had known Kim.
And so I called him.
I said, let's have much.
And I said, have you everthought about, you know,
retiring?
He said, yeah, actually I have,I just don't quite know how I'm
going to go about it, but I havecandy.
And she's, she's the one I'vetold her all along someday,
(30:43):
you're going to own this.
And I said, well, how bet if wefigure out how to do that?
And he says, yeah, I'd lovethat.
So I came back to the office andI said to Barry, this was not on
the plan, but it's howserendipitous life is sometimes.
Right.
I said, you know, there's thisopportunity for us to merge with
(31:03):
this other practice.
And, and so fitting into theten-year plan we got going on.
That could be really good, butif you hate her, this is not
going to work at all.
So why don't you go take her tocoffee and just talk and see if
you guys like each other?
Well, not only did they likeeach other, they were just this
(31:26):
train that suddenly was loadedand rocketing down the tracks
because they could both see shehad candy, had had promises made
Mary and a deal, both see thatthe opportunity was to put this
together and have a reallysignificant business.
(31:47):
So we literally, within monthshad merged the businesses.
And, and as I went through theprocess of that, I realized, you
know, the math doesn't work forme to be a principal in the
benefits business.
The math works for me to sellthem my benefits business and
(32:09):
let them buy his benefitsbusiness.
Then Barry and I will keepworking the retirement business.
And so that's, that was thestarting point rather than
occupying, Oh, the air time.
I'm going to let you pose aquestion here.
Speaker 2 (32:28):
Well, you know, um, you know, I'm curious, I, can
you get into, um, this, this isfascinating because I know this
is a huge issue for so manypeople in the financial services
industry.
Can you talk a bit about themechanics of how it works?
Uh, the ownership.
Speaker 4 (32:45):
Yeah.
So, as I mentioned with my dad,it really is a matter of the
owner being rational about thefinancials.
Okay.
There aren't that many smallbusinesses that are that liquid
that just happen to have a keyemployees who have a spare, a
(33:07):
hundred thousand bucks in theirpocket, right.
Just everybody is living well.
Well, we live well and we dowell.
We still, from a certainperspective, live month to month
monthly mortgage, we got monthlygroceries.
We got kids who have schools,situations, we've got new cars
(33:28):
to buy insurance premiums to payall of that stuff.
Right?
So that the owner has to startfrom the point of view of taking
off the, um, the filter thatsays, I have to get all my money
up front that's number one, yougo at it with that point of
(33:51):
view, you probably will haveyour business die, and then you
will die and you will both beold and there will be nothing
left.
And you will have had to work inyour business for 20 or 30 more
years.
So if you let that go, you canstart looking at well.
So how could we make this workin, in my dad's case?
(34:15):
And in my case, I didn't requirea down payment and required
monthly payments.
And I, you just have to do thespreadsheets and say, what's
the, what's the predictable cashflows of the business.
What is a good owner'scompensation?
Maybe not what you're taking outof the business, because if
(34:36):
we're successful, we're takingout quite a lot.
And we said, well, that's myjust compensation, but really
there's a lot of profit on topof the actual work based
compensation that you're takingin most cases, because, you know
, in the 401k and pensionbusiness, one of the things that
(34:56):
was just part of the job of theconsultant was to know what
everybody got paid, why?
Cause non-discrimination testingrequires that as part of the
form pillar.
So I saw pet owners in almostevery business make a lot of
money.
So you gotta, you gotta go fromthe point of view of, well, you
(35:18):
know, 400 is my number two.
Yeah.
But the business can't pay me400 and keep going with a new
owner.
What are they supposed to dolive on 40,000 a year for 10
years while you get your 400,you know?
So you have to get over that.
That's really part of the hurdleas a seller is what's it?
(35:42):
What works?
Think about it as a what workssituation.
What is, what is the businessneed to keep functioning and
running on all cylinders?
What does the new owner need tomake it?
So that screwing it up is wayworse, way worse than the great
(36:06):
situation of keeping going isthey're in a good situation.
They will never screw it up.
Why would that, and then, thenyou figure out based on those
two factors, how much can thebusiness sustain and pay me?
What's the value of thebusiness?
So therefore, how many years isit gonna take?
I don't, what did I do?
(36:27):
I gave him 22 years.
Why 22?
Because that's how the mathworked out well for everybody
there, there they are alreadybecause they combined the two
businesses and because of their,their young age and they're
right, they were right at thepeak influential point in their
(36:50):
career, my two buyers.
And so what have they done withthe business?
It's vastly bigger than I evercould have, did make it.
And so my financial security is,um, um, a, I'm still a number
significant to their formula,but I'm not pigging out on their
(37:18):
revenue and their work in such away that it's at all hard for
them to continue to run thebusiness and keep paying.
Meanwhile, my family and I getto live a pretty comfortable
life because of the combinationof our other.
I mean, that doesn't mean anowner doesn't have money in 401k
and other investments do otherplanning.
(37:41):
Can't thank you for yourbusinesses, your whole
retirement, but as a core, it'syour major investment?
It's your major asset?
Speaker 2 (37:52):
Well, I think actually that is an amazing
point because, you know, as Iwas thinking about it is, you
know, the way you describe it,it's almost an annuity for you.
Speaker 4 (38:05):
It isn't, I love annuities by the way.
Speaker 2 (38:09):
I, I think annuities, you know, have gotten a bad rap
overall, you know, um,unfortunately some companies
have twisted them and earnedthat reputation.
But I think the concept, youknow, especially in this, uh,
type of scenario is, is awonderful way.
It works for everybody.
But I think the core value thatI'm hearing from you is that you
(38:31):
can't be greedy.
You need to be realistic and toshare, um, you know, maybe that
principle, you know, I don'tknow if you remember that, all,
everything I need to know, Ilearned in kindergarten, you
know,
Speaker 4 (38:50):
Being stupid on either side of the equation,
that's where it takes thespreadsheeting.
You'll have to either hireyourself a spreadsheet or you'll
have to train yourself to be aspreadsheet.
Or maybe you are one, but that'sthe way you can just tinker with
the numbers.
And it's a lot of people want tomake business transactions, you
(39:13):
know, fancier than that.
But really it's a matter of thebuild a spreadsheet.
You see how the numbers flow andyou watch it, you say, does this
work on all sides of theequation?
If it does.
And it works well, then it'slikelihood is it's going to keep
(39:33):
working if you've, if you, sothe other piece of this equation
though, is it's, it's a reallyimportant part.
It's mentoring the success.
A lot of people think, well, I'mgoing to sell it.
There'll be, you know, they'remy kid.
They'll try.
I trust them.
There'll be good.
(39:54):
Okay.
That might work.
And then many cases it does, butin many cases, it doesn't.
And it's really a matter oflooking at that whole person and
saying, are they reallycommitted to the whole package
here?
Did the kind of business we'rein to perpetuating this
business.
Do they have a vision for whereit should go?
(40:17):
Because a lot of us tend tothink, well, I know that at all.
No we don't.
So when it's time to get out ofthe way, if they really have a
passion, they that business,because it's this really nice
platform we've built up over theyears, I took the platform, my
dad built and built it manytimes bigger.
(40:41):
They are taking the platformthat I built and the project
bill and taking it way manytimes bigger than that.
And ideally few years down theroad, they'll either they will
have grown it to the point wherethey really are an acquisition
target at a certain scale.
Businesses become acquisitiontargets, but they have to be of
(41:06):
a significance that the buyerreally sees a financial asset at
that point, not just a, youknow, that's one of the things I
talk about in the businessbeyond the, that is really part
of this mentoring equation.
I think it is a mentality of anowner that is looking for an
(41:29):
angel buyer, like, like the techget angel investors and angel
buyer is a fantasy for mostbusinesses.
Why?
Because an angel buyer and a 10person business, the owner has
to work.
Then an angel buyer never wantsto work.
(41:51):
They want to give you 500,000bucks.
And in five years they want 5million back and they don't want
to work.
They want to walk in and say,what the hell are you doing?
Do it better.
And walk out and wait for their5 million to come.
So they can take that 5 millionand buy five more businesses
each where the million and dothe same thing.
That's their mentality.
(42:12):
Most small businesses need aperson that works.
So as you're mentoring yourperson, that's really the
equation to be looking at.
Are they, are they a worker?
A lot of people like to use theword I'm an entrepreneur.
Well, you know, entrepreneurs,they startup mentality.
(42:33):
After, after a couple of yearsof entrepreneurs, if you don't
have going business concern,that is a business, then you are
a business owner, but you reallynot.
It's not a thing, right?
Entrepreneurship is not really athing in my book.
Ownership is a thing.
(42:53):
That's why I called it theownership ladder, because that
will, entrepreneur's a greatbuzz word.
Everybody likes, especiallypress.
They love that.
They love to talk about it.
Colleges like the teacher,entrepreneur classes as well.
I think they should teachbusiness owner classes because
that's where most of theactivity and the universe is
Speaker 2 (43:14):
Definitely.
Well, I think one thing is I'mnot going to tell entrepreneur
magazine about this interview.
It may be highly disappointed.
Speaker 4 (43:23):
They asked me to write an article or I get to,
you know, I'm gonna, I'm gonna,I'm gonna spin it a bit
different.
Speaker 2 (43:30):
So, you know, um, have a couple wrap-up questions,
but I, I think a big one is, um,a lot of people in the insurance
nerds audience are younger intheir careers.
So how can they positionthemselves?
You know, to be the type ofperson who could participate in
an ownership ladder typesituation, what advice would you
(43:52):
give somebody who's young?
Speaker 4 (43:54):
Yeah.
Uh, I saw it often.
I never, I never did it myself,but there are, um, there are
people who are, and I've seen itin the securities business more
than I've seen it in theinsurance business, but a person
with a book of business who isgetting ready to retire and a
(44:17):
young business owner who isbuilding their business.
If they think of an ownershipladder in the context of
themselves, rolling up abusiness and saying, Oh well,
there's agency down.
The street is a good guy.
He's got two or three people andobviously drive a nice car.
(44:37):
And he lives in a nice part oftown, probably successful.
And he probably wants to retireat some point.
And in the same token, as we'vebeen talking, his opportunity to
be rolled up, he may not be thatbig.
You may not be that significantin a, in a, you know, you need
(44:59):
to be there talking to yourclientele on a one-on-one basis
to keep the trust.
This younger person can think ofit in that, that they could
acquire other books of businessthrough understanding the
ownership ladder and being, evenif they don't work there or they
(45:19):
don't work there for a longtime, they could use the ideas
here to position themselves withthose business owners.
The other thing that isimportant, I think for younger
business, people to do is, istake every action in the
business that is designed with amentality that I am growing at
(45:46):
business to be a longterm asset.
I'm not getting next months, carpayment, where this transaction
I'm building my business.
And as I build my business, I ammaking a marketable entity and a
marketable organization.
So what does that mean?
(46:06):
I gotta have good records.
I gotta maintain financials ofthe business that are completely
separate from my own.
I have to hire professionals tomake sure that my, my legal, my
accounting, my, uh, operationalfunctions are really
well-defined.
(46:26):
So that over time as you build,because businesses gained value
by having pro that's it becauseit's, it's a mental, I mean,
it's mostly mental assets, sowhat's the proof.
Well, you've got a track worker,you've got clients.
If you have a great CRM thattracks all of your client
(46:48):
relationships over time, thosebecome part of your marketing
package.
And then as you grow older andyou start to see yourself as a
mentor role, your own personalMary and candy and practice so
that they can be com owners.
And frankly, if you, it was trueof me, I guess, a lot of frogs
(47:11):
throughout the process of tryingto find the succession part,
kept doing it for quite quite alot of years, bringing in people
thinking, well, this will be apartner.
Eventually they'll buy the out,uh, be ready to say, eh, you're
out.
Speaker 2 (47:32):
Uh, I think that that's an important point is
that it is about the fit.
Um, and, and this is sointeresting.
There's, there's so much toexplore here and that I, I think
this is going to be extremelyhelpful to those in the
industry.
Um, you know, either own theirsmall agency or brokerage, you
(47:53):
know, whatever operation thatthey have and are looking, you
know, a lot of us in theinsurance industry are graying
out and, uh, you know, it's timefor a new generation.
Uh, I think the insuranceindustry is kind of hitting a
refresh point.
I, you know, you share thatview.
Um, you know, the, the questionI always like to wrap up with is
(48:16):
do you know, getting your numberone tip on being financially
prepared, you know, what haveyou learned and what would be
that one tip that you wouldleave, you know, either
consumers or advisors with,about being financially
prepared,
Speaker 4 (48:31):
Put your money in your 401k too.
Speaker 2 (48:35):
That is excellent because I think that's something
I can't remember the statistics,how much, how many people don't
take advantage of the 401kmatch.
And that's something I couldnever understand walking away
from that free money.
Speaker 4 (48:47):
Exactly.
Well, and if you're the owner ofthe business, you have to, you
have to create a 401k and itcosts you money to do it, but
the longterm benefit of that toyou and to everybody else,
because you don't get to justcram in all you want without
bringing your folks along.
(49:08):
And that's just that that's thenon-discrimination rules that
are existing and they're fair.
They're right.
So build your plan so that it,it makes it possible for you to
maximize it for yourself so thatyou have it's, it's one of your
multiple assets that you canrely on for your monthly
(49:31):
paychecks when it comes time.
Speaker 2 (49:33):
Boy, that sounds really close to the concept of
the ownership ladder.
Speaker 4 (49:39):
The whole thing is really, really tied together.
They, they, there are, you know,when you brought up annuities
earlier, I'm just gonna refreshon that for a moment.
Social security really isn't anew 401k, regardless of how you
extract the money from it reallyisn't an annuity, your ownership
(50:02):
in the business and the way youfinance and help the person
finance the exit is an annuity.
But I can guarantee you,especially as an early retiree,
because, uh, because healthinsurance costs continue family
that costs of an old guy buyinghealth insurance is ridiculously
(50:23):
expensive.
You need a pretty healthyannuity to, to go buy yourself
some health insurance, if you'regoing to early retire.
So, but my advice actually is totry to stick it out till you're
60.
I mean, 65, excuse me.
I was 60 when I exited and itwas the right thing for my, my
(50:45):
people, my buyers, I was in, Iwould have been in the way if I
had stuck around and reallydistracted from and detracted
from the success of thebusiness.
So I did, but from a financialpoint of view, if you can find
somebody else to pay your healthinsurance, like Medicare, that's
(51:05):
a good thing, putting a pitchfor some of those politicians.
Speaker 2 (51:12):
Well, I think, you know, it's unfortunate.
I know, you know, in, in workingwith financial planners, you
know, over the years andconsulting for them, that health
insurance is always one of thebig topics for people is, you
know, what do you do with thathealth insurance premiums in
retirement?
And, you know, pre-retirement,um, anyway, um, thank you so
(51:35):
much for coming on today.
Um, where can people learn moreabout you and the ownership?
Speaker 4 (51:40):
So I'm going to grab a copy.
So the book cover, which you seehere is changing on amazon.com
because Amazon's background iswhite.
As I discovered after Ipublished it and this book cover
while beautiful, and I love thishandshake, it's just, it's so
(52:02):
significant, but it doesn't popoff of the page of Amazon.
So the new book cover, don't belooking for this cover.
When you go looking for theownership ladder, you will still
find the ownership ladder, butit will be mostly orange with a
kind of a, a torn front icon toit.
And, um, so you go to Amazon andbuy the book.
(52:27):
If you are an Amazon, a Kindleunlimited reader, you can read
it for free.
I have heavily discounted rightnow, so you can get a copy of it
for a very low price.
I would love to have peopleconnect with me on LinkedIn.
So bill he, Stan H E S T a N DLinkedIn slash bill.
He stand connect with me.
(52:49):
That's where I do a lot ofcommunicating on part of a bunch
of different groups.
And I just enjoy participatingin those groups on my website,
the ownership ladder.com.
You can join the mailing list.
You can get a free copy of thesummary version of this book,
which is basically all of the,all of the section summaries.
(53:12):
Each of the groups, there's foursections in the book.
And so I presented each of themwith a summary section.
So if somebody wants a quick andeasy overview of the book, join
my mailinglist@ownershipletter.com
Speaker 3 (53:26):
And you'll get emailed a PDF of that.
You want to buy and go toamazon.com and buy and pay me
money for it.
But
Speaker 2 (53:36):
Well, and for our listeners, all that, you know,
in case you didn't have your penout, or you're listening to the
song to go is all the links willbe in the show notes.
So you can just, uh, you know,enter convenience, uh, check out
the show notes and find outdifferent ways to connect with
bill and find out what he's upto.
Uh, bill.
Thank you so much for joining metoday.
It's been a real pleasure.
Speaker 3 (53:57):
Oh yeah.
I've really enjoyed it.
Great conversation.
Hopefully it's helping somebody.
Speaker 2 (54:02):
I think it'll help a lot of the audience out there.
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