Episode Transcript
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Speaker 1 (00:03):
Thirteen ten Wi b A and Ask the Experts, brought
to you this morning by Wisconsin Capital Management the website
whizcap dot com. It's wiscap dot com. Whizcap dot com.
Great place to learn more about Wisconsin Capital Management, get
to know the team there. You can also if you're
looking to set up that appointment, we'll get to know
you conversation if you head on over wizcap dot com.
(00:23):
You can do it right from the website. Very very
convenient in joining us this morning from Wisconsin Capital Management.
Nathan and Tom Plumb. Tom, how you doing this morning?
Speaker 2 (00:32):
We're doing very good. Sean, thank you. It's got a
touch on of in Wisconsin.
Speaker 1 (00:37):
What a what a weird week it has been. And Nathan,
are you getting a chance to enjoy some of this
cooler weather.
Speaker 3 (00:44):
Oh yeah, it's a football season, so yeah, I'm fully
on board.
Speaker 4 (00:48):
I love it.
Speaker 1 (00:48):
Yeah, And that's h And that's if you hit it
on the head there too. It has been. It's been
a great week for football. Feel it in the air
as well. And we've got a great conversation this week.
You're going to kind of refinal some we had talked
about the other week about a little bit about businesses
and kind of working the roles in different areas and
kind of the analogy of almost like an airline pilot.
(01:09):
We're going to get into that with Nadan just a moment.
But first, Tom, real quick, before we get started on
this week's topic and conversation, let's talk a little bit
about Wisconsin Capital Management, a little bit about the background there.
Of course, you started Wisconsin Capital Management a few years ago.
There's certain nuanced things different, you know, when it comes
to like client profiles and other things. You guys get
into get into a couple of different areas, don't you, Tom, Well, we.
Speaker 2 (01:32):
Do, Sean, And our first few shows that we did,
we talked about some of the basic premises that we
use in establishing how to set up client portfolios, how
to try to meet their investment goals, how to use compounding,
and how to use risk control to actually make a
(01:52):
difference between when you talk about actual volatility versus risk
and how you can differentiate those.
Speaker 1 (02:01):
Those are really really good shows, and I hope if
folks get a chance to listen back at Wisconsin Capital
Management's website, it's wizcap dot com. That's wiscap dot com.
Listen to the podcast there. You can also listen to
it on the radio station's website as well as on
the iHeartRadio app. I'm pretty sure too, if yes, you're
smart speaker to play Wiscons ask the experts with Wisconsin
Capital Management. I do believe. I checked the other week
(02:22):
it was playing and working that way as well, So
it's another great way to listen to the show. And
you know, we started talking the other week just a
little bit about some comparables when it comes to similarities
between maybe your industry and others and kind of helping
people break down what exactly it is and how you
help people. Let's talk a little bit about that that
airline pilot analogy and kind of dig a little bit
(02:43):
deeper into that one.
Speaker 4 (02:45):
Yeah, thank you, Sean.
Speaker 3 (02:46):
Yeah, I got some good feedback on our airline analogy
that we made on the air together, so if you recalled.
We talked about people that it felt like they always
always could only be the first class and the the plane,
and that's how other financial advisors tell you. So we
talked about high investment minimums and things like that. So
(03:08):
just to make to tighten up the analogy, so we
kind of look ourselves as like airplane pilots, and we're
on the plane for your essentially your financial needs and
financial futures. So you know, in that we have constructed
our business so that we have kind of the do
yourself as a DIY people in the back. We people
(03:28):
can choose different stocks for us from so they called
Echo trade, and then we have our proprietary mutual funds,
which is essentially our economy plus option. And then we
also also have like the first club, first class why
global service as you know everyone else has as well.
But the main thing is that we're still the pilots,
so we're all going the same place. So you know,
(03:51):
if you we understand what your financial goals are and
we can help you, you know, plan that follows the
magic of like the power compounding as we talked before,
and we can minimum it's probably the probability of volatility
in developing risk and having the cashold to support your lifestole.
So going back to that analogy about airplanes, like we're
(04:14):
hoping to you know, take out the turbulence for you,
so you know, and again you know, if you if
you have the financial discipline to of saved one thousand
dollars in your life.
Speaker 4 (04:26):
You're ready to get on that plane.
Speaker 3 (04:27):
So you know you have to get on to to
help your future takeoff and your investments take off.
Speaker 4 (04:33):
So I just wanted to The key thing is just you.
Speaker 3 (04:36):
Know, get on the plane, get all get get to
the airport, get on that plane.
Speaker 1 (04:40):
And it's so important you mentioned you mentioned n even
you know, even making that small initial investment just to
start is I think for a lot of folks sometimes
there's there may be maybe they feel as though they've
missed opportunity, you know, they they see all these great
things going on the market, and they go, yeah, well
that stuff has passed me by. The reality is the
best day to start? I think. I think the line
is always the best way to start investing is yesterday.
(05:02):
The second best day is today. It's it's always a
great time to start that to start that investment, isn't it.
Speaker 4 (05:09):
Ye, It's very true.
Speaker 3 (05:09):
So people things like go, I like, I just that
doesn't apply to me. They go, this person had X,
Y and Z haptoms, so they're luckier than I'm like, no,
they you know, you all start in the same place.
You all start with the first step, so you just
got to go.
Speaker 1 (05:24):
It's a great day to make that first step as well,
as we talked this morning with Naton Tom Plum of
course with Wisconsin Capital Management. The website whizcap dot com.
That's w i s c ap dot com. Great website
and resource to learn more about Wisconsin Capital Management. Of course,
set an employment as well right online at wiz cap
dot com and talk to Tom in a moment just
about transitioning as well. You know, you spend all your
(05:45):
all your working year saving and then you get into retirement,
you guys start thinking, oh, I've got to start spending
this stuff. That is that is quite the shift as
we're talking with Tom about that in just a moment.
But real quick to Nathan, when you're talking about your
airline analogy, it was funny because my wife came to mind.
Is my wife is is like just she's and I
love her for this is She's a chronic worrior. She's
(06:06):
one of these people that no matter what, she's always thinking, Okay,
something bad is going to happen. And you're talking a
little bit about white glove service and like first class things,
I'm going to guess she's probably one of those types
that you would kind of refer to that. You know,
for her is it's not that she doesn't trust, she
just wants to be assured that everything's going well. And
we talk about some of the things you're able to
offer at Wisconsin Capital Management for folks that really want
(06:28):
to be kind of hands on and get that back
and forth information. You're very, very open to helping and
guide people. And maybe maybe those folks that are worried
suggest need a little reassurance. You guys are there for them,
aren't you.
Speaker 3 (06:41):
Yeah, And we preach balance and so you know, hopefully
we're designing these portfolios to hopefully mitigate the volatility. So
the worst thing you could do in our field is
scare someone on the off out of the market. So
if someone is so worried that just like I got
to go to cash, I go to zero, that is
always the worst possible.
Speaker 4 (06:58):
Thing you could do.
Speaker 3 (06:59):
So, you know, people on our field, if you choose
us or everyone else, is always good to you know,
try to get you to those hard points. And that's actually,
you know, my money well spent on a financial advisor,
that is for sure.
Speaker 1 (07:12):
Talking this morning with Nae and Tom Plumb, of course
of Wisconsin Capital Management mentioned the website whiz cap dot com.
That's Wi s c ap dot com. Hope you get
a chance to stay, to stop on buy the website again,
that's whiz cap dot com. It's no Tom. You can
get to Nathan and the whole team at Wisconsin Capital
Management a little bit more about them, and of course
you can also set an appointment right online at wiz
(07:32):
cap dot com. So Tom bringing you into this conversation.
It's weird to think about, but you know, we spent
so many years squirreling and building this next egg, putting
money away. We often think, I think, especially when we're younger,
like we're going to hit that We're going to hit
that goal, We're going to hit that number, we're going
to hit that date to retire, and it's going to
be just so easy to suddenly start, you know, opening
(07:53):
up this this vault and just spending this money. For
a lot of folks because of all of those years
of discipline and work and savings, it's not as easy
as it appears to kind of throw that switch, is it.
Speaker 2 (08:07):
No, Sean, a lot of people as they approach the
time of let's say retirement, because that's one of the
big milestones of people here. But as you approach that number,
you start to get anxious and you start to ask yourself,
how much do I need in savings for a comfortable retirement?
How can I do it? As Nate said, with the
(08:28):
least amount of anxiety, but actually start to move the
concept from being I need to save, I need to
save two I've saved enough now I can afford to
actually comfortably retire.
Speaker 1 (08:42):
Let's talk about some of the terms in some of
those some of those areas as we talked Tom about
about comfortable retirement are, what are some of the some
of the things we need to know about there?
Speaker 2 (08:51):
Well, Sean, I think the three things that we like
to talk about. One is the concept of a sustainable withdrawal,
And by that we mean that if you have a
certain amount of dollar amount of assets, and you'd like
to start to think about, what could I take annually
from my assets, from my savings that will allow me
(09:12):
a comfortable retirement today and to keep up with inflation
so that I will have a comfortable retirement in the
future and not run out of money. We call that
sustainable withdrawal. So we set up and look at we
have to have an assumption of what your earnings rates
will be, what the inflation rade will be, and what
(09:33):
timeframe we're talking about. But that's an important concept of
how much can I start to take out today and
be able to maintain that withdrawal rate for the rest
of my life. The second one is basically looking at
what are your true financial resources available to support your
cash needs. You may be asset rich, you might have
(09:57):
a very valuable house, you might have ar election, you
might have cars, but typically they don't provide cash flow,
so you need to be able to define what assets
are actually going to be there to support my retirement.
And finally, the time frame. Are you looking at your
(10:17):
life expectancy? Now you can put up variables around that
because most of us don't have the date when our
plan will end. But are you looking at your life
expectancy or are you looking at what we call legacy
for your children, your grandchildren, the foundation, the charities, anything
(10:38):
else that you might want to support beyond your own
life expectancy. So time frame is very important when we
look at that third variable.
Speaker 1 (10:48):
And you also think about that time frame as well,
and that variable, as we're going to talk a little
bit later on, are some of the risks to your
portfolio and other things, but time is definitely the biggest
asset you have. And as we start this conversation this
week off talking about the importance of taking that first
step getting started today's day to head on over to
Wisconsin Capital Management's website. That's wizcap dot com. That's wiscap
(11:11):
dot com. Get set an appointment right online, a great data
start that start building, building that portfolio, building that nest egg. Again,
it starts with a little step. If we've been looking
and interested, they'd love to get to know you a
Wisconsin Capital Management again the website whizcap dot com. That's
wiscap dot com. We're to continue our conversation with Tom
and Nathan. We'll talk about that inflation word. We'll also
(11:32):
talk about something you probably heard about and may not
know the history of, which is the with sustainable withdrawal
rate rate that some folks think as far as a percentage.
We've heard some numbers. What do they mean? What is
the actual withdrawal rate? We'll find out from Natan Tom.
We will do that next as ask the experts with
Wisconsin Capital Management continues right here on thirteen ten wib
(11:52):
A thirteen ten Wi b A and asked the experts
hanging out this morning with Tom and Nathan Plumb with
Wisconsin Capital Management. You can learn more about the guys.
You can learn more about Wisconsin Capital Management the team there.
(12:14):
They can also how they can help you, and of
course set an appointment right online wiz cap dot com.
That's wiscap dot com. When you get into the office
this morning. Check that website out against whizcap dot com.
I'm talking this week with Tom and Nate about some
really important things when it comes to comfortable retirement and
saving for a comfortable retirement. And of course in that
(12:37):
last segment, Tom, you had mentioned sustainable withdrawal, and I'm
going to put this on you, Nathan. I think a
lot of folks here about this. What isn't the four
percent rule?
Speaker 4 (12:46):
I think it was to.
Speaker 1 (12:47):
Explain explain what that is and a little bit about
the backstory there.
Speaker 4 (12:51):
Nate.
Speaker 3 (12:52):
Yeah, So a lot of financial planners use this kind
of like this withdrawal rate they have in these financial plans.
Speaker 4 (13:00):
Have you build and are they build?
Speaker 3 (13:02):
And the key thing assumption is that they're taking out
you take out four percent of your assets every year consistently, right,
So we find in real life that's a little bit different.
So again just to kind of go back to that
four percent rule. So if you have a million dollars
in your retirement and you're taking out four percent, that's
(13:25):
taking out forty thousand dollars a year. So even though
you're a millionaire and that sounds absolutely amazing and just
like an incredible number in the retirement, like you know,
forty thousand years, you're actually not that rich. So so
when you're talking about millionaires, you know, there's a difference
between you and talking about you know, a person with
(13:45):
one million dollars five million vers fifty million dollars.
Speaker 4 (13:48):
And then you get up to the you know, the
the people that hear bout the news with the one
hundreds of millions of dollars. But you know, you know, so.
Speaker 3 (13:58):
You know, a million dollars is a lot of money,
but it's very achievable for most people. So just you know,
just think about about the withdrawal rate and the four
percent to just keep that if you had a million dollars,
the financial planner is usually modeling that you're taking forty
thousand dollars a year.
Speaker 1 (14:14):
With that breakdown to Nathan as if it was a
Bill Bengen I think was one of the notes pointed
out it was kind of the guy that that authored that.
And as you were alluding to there that number, I
think for a lot of folks and folks that meet
with you are maybe surprise learned that the number might
be a little bit lower than than it actually in practice,
might actually be a bit more on my off on that.
Speaker 3 (14:34):
Nathan, Yeah, So yeah, again, when you're talking about a
million dollars, you're thinking about you know, Lamborghini's and you know,
really you know, effluent lifestyle things. But you know, for
people at the middle class, I mean, this is what
it really means, and this is what you know hopefully
you know, if you talk to an expert, they're going
to keep you within this range. The thing is that
(14:55):
you want to be balanced. I guess that's our mantra.
So you always had to have some assets are going
to grow because even if you're sixty years old, I
mean from a retirement standpoint, you might still be young.
We're hoping that you're going to live till nine years old.
So you got to invest, you know, in a way
that was conduce so to actually making that number. So
(15:16):
you know, we find that being bounced in socks and bonds. Again,
the stocks are the growth engine and the portfolio the
bonds are kind of like almost like a shock absorber.
They're trying to keep the volatility of the turbulence down
of the portfolio. We find that that is pretty much
an ideal miss mix, and that's what you see a
lot of these endowments, foundations, pension plans. They usually have
(15:36):
a similar asset allocation to the sixty forty.
Speaker 1 (15:39):
Doggin this morning with Nathan and Tom Plumb. Of course
they are with Wisconsin Capital Management. The website whizcap dot com.
That's wiscap dot com. You can learn more on the
website about Nathan, Tom and the whole team at Wisconsin
Capital Management. You can learn more about them, a little
bit about their history. Also very Important've been looking to
set an appointment get to know Nate and Tom. All
I gotta do is head over to that web sa
(16:00):
wiz cap dot com. That's wiscap dot com. You can
sent appointment right online. The inflation word, I kind of
get shivers. Me mentioned that, but that is and Tom
correct me if I'm wrong. Quite possibly the biggest risk
to all of this to your savings. Is that erosion
of spending power because of inflation.
Speaker 2 (16:21):
Yeah, so we've talked about in the past. Time is
a great friend when you're looking at your compounding for
your rate of return, building up your assets and your
financial security. But it also has another side to it,
and that is inflation over time can be the biggest
deturned to actually being comfortable in your later years. So
(16:45):
you know, when we look back at the last one
hundred years and when Bill Bengen, who started this whole
idea of four percent twenty years ago, he's revised his
numbers because the actuality is that there's only been one
time when you've had a combination of the stock market
going down and inflation going up so that you ended
(17:10):
up not being able to withdrawal initially four point seven
percent almost five percent from your retirement assets. Now remember
these aren't your only source of retirement income. You'll also
have social Security, some of us actually might have a
pension or something like that. But when you look at
(17:30):
your actual financial assets and you think about what that
could happen to them to prevent you from reaching your
goals or in later life being able to sustain your
buying power. Basically, inflation is the big enemy. In nineteen
sixty eight we started out at that time, we had
(17:53):
then two significant stock market corrections in the next ten
years at the same time that inflation started to accelerate
from six percent to nine percent a year. That's the
worst of all worlds. If you don't have on nineteen
sixty eight. Now that's one in one hundred, So it's
(18:14):
still possible. On average, the sustainable which all rate has
actually been closer to seven percent. So it depends on
how conservative you want to be and how you structure
your investments, and whether or not you structure them in
a way that you can be a long term investor
with a portion of those assets.
Speaker 1 (18:34):
Talking this morning with Tom and Nathan Plumb with Wisconsin
Capital Management Online wiscap dot com. That's wiscap dot com.
Don't forget if you miss any part today's program and
listen back to this in previous shows all at the
website wiscap dot com. You also set an appointment right online.
And as we talk about some of the risks out
there to your portfolio. Obviously, as Tom, as you mentioned,
(18:55):
inflation is big, but Nate also volatile investments and holding
on to things that may not be worth holding onto.
Let's talk a little bit about that, Nathan.
Speaker 3 (19:06):
Yeah, So often in down markets, when people get scared,
they want to kind of sell the the assets are
the most down during a financial correction. So again, if
you're modeling this out as kind of financial planning, you're
planning that the out of a ten year rolling period,
you're betting the market go seven or seven and a
half of the ten years, right, So there's going to
(19:28):
be some corrections, there's going to be some down periods.
Speaker 4 (19:31):
So what do you do in those down periods?
Speaker 3 (19:33):
A lot of people panic and they want to sell
the kind of like the high growth asset, and usually
means stocks. And again just stocks are you're buying ownership
of companies, right, and so people panic can kind of
sell those because they see they're down, right, And that's
actually kind of like the thing you really want to avoid. So,
I know, it's an emotional decision. No one likes to see,
(19:55):
you know, things going down. People think, oh my gosh,
I can't lose any more than i've lost.
Speaker 4 (19:59):
Now, you know, you have to really.
Speaker 3 (20:03):
You know, try to you know, understand these type of markets.
So that's why we've preached balance, and that's why we
kind of preach you know, you should have your money
in essentially different buckets, right, So you should have some
savings essentially if you have something in checking or savings
or CDs, I mean, you're not really saving money. Usually
those interest rates you're getting on are just what what
(20:24):
is inflation or what currently is inflation? Right, and then
if you have some money that that you need the
next uh, you know, three to seven years or that's intermediate.
So that's a really good part to be balanced. To
be in stocks again, ownership of companies, that bonds, liability
of companies, and then you know what's the far off future, right,
so that you could be a little bit more stock heavy.
(20:45):
So it's usually not the wisest thing to adjust during
these kind of down periods in the market. So you
want to stay consistently in here and that way, if
you're balanced and you're not going to scare yourself, you're
going to stay into the market.
Speaker 4 (20:57):
So I guess that's you know what we kind of
preach here.
Speaker 3 (21:00):
So we preach balance, and you know, don't put all
your bigs one basket and just really you know, make
sure that you kind of anticipate like when things go wrong,
so otherwise you just come don't feel.
Speaker 1 (21:12):
Panicked, building really important and well balanced portfolios. This morning,
as we talked with Nate and Tom Plumb, of course
they are with Wisconsin Capital Management and Nate before we
wrap this week, you know, there's ever so often things
you'll see coming up on the calendar really important to highlight.
And you mentioned coming up not too long from now.
Folks looking to purchase a car may want to pay
(21:33):
close attention, shouldn't they.
Speaker 3 (21:35):
Yeah, So if anyone that's been thinking about buying an
electric vehicle, the EB tax credit of seventy five hundred
dollars goes away as of later this month, which is
September thirty, twenty twenty five. So if you've been on
the fence doing that, you should go out there this
monthing and make it happen.
Speaker 1 (21:53):
Really important, great guidance there as always talking this morning
with Tom and Nathan Plumber, of course friends from Wisconsin
Cap Management. Online whizcap dot com that's Wi s c
ap dot com. On the website whizcap dot com you
learn more about Wisconsin Capital Management. You can also set
up an appointment right online. Whizcap dot com again, that's
w I s c ap dot com. Tom, Nate. It's
(22:15):
great chatting with both of you. Guys. Have a great day, Tom,
you take care.
Speaker 2 (22:19):
Thanks Shawani you have a good day too.
Speaker 1 (22:21):
Nate, you have a great one also.
Speaker 4 (22:23):
All right, thanks Sean, appreciate it.
Speaker 1 (22:25):
News comes your way next right here on thirteen ten
wu I B A
Thirteen ten Wi b A and Ask the Experts, brought
to you this morning by Wisconsin Capital Management the website
whizcap dot com. It's wiscap dot com. Whizcap dot com.
Great place to learn more about Wisconsin Capital Management, get
to know the team there. You can also if you're
looking to set up that appointment, we'll get to know
you conversation if you head on over wizcap dot com.
(00:23):
You can do it right from the website. Very very
convenient in joining us this morning from Wisconsin Capital Management.
Nathan and Tom Plumb. Tom, how you doing this morning?
Speaker 2 (00:32):
We're doing very good. Sean, thank you. It's got a
touch on of in Wisconsin.
Speaker 1 (00:37):
What a what a weird week it has been. And Nathan,
are you getting a chance to enjoy some of this
cooler weather.
Speaker 3 (00:44):
Oh yeah, it's a football season, so yeah, I'm fully
on board.
Speaker 4 (00:48):
I love it.
Speaker 1 (00:48):
Yeah, And that's h And that's if you hit it
on the head there too. It has been. It's been
a great week for football. Feel it in the air
as well. And we've got a great conversation this week.
You're going to kind of refinal some we had talked
about the other week about a little bit about businesses
and kind of working the roles in different areas and
kind of the analogy of almost like an airline pilot.
(01:09):
We're going to get into that with Nadan just a moment.
But first, Tom, real quick, before we get started on
this week's topic and conversation, let's talk a little bit
about Wisconsin Capital Management, a little bit about the background there.
Of course, you started Wisconsin Capital Management a few years ago.
There's certain nuanced things different, you know, when it comes
to like client profiles and other things. You guys get
into get into a couple of different areas, don't you, Tom, Well, we.
Speaker 2 (01:32):
Do, Sean, And our first few shows that we did,
we talked about some of the basic premises that we
use in establishing how to set up client portfolios, how
to try to meet their investment goals, how to use compounding,
and how to use risk control to actually make a
(01:52):
difference between when you talk about actual volatility versus risk
and how you can differentiate those.
Speaker 1 (02:01):
Those are really really good shows, and I hope if
folks get a chance to listen back at Wisconsin Capital
Management's website, it's wizcap dot com. That's wiscap dot com.
Listen to the podcast there. You can also listen to
it on the radio station's website as well as on
the iHeartRadio app. I'm pretty sure too, if yes, you're
smart speaker to play Wiscons ask the experts with Wisconsin
Capital Management. I do believe. I checked the other week
(02:22):
it was playing and working that way as well, So
it's another great way to listen to the show. And
you know, we started talking the other week just a
little bit about some comparables when it comes to similarities
between maybe your industry and others and kind of helping
people break down what exactly it is and how you
help people. Let's talk a little bit about that that
airline pilot analogy and kind of dig a little bit
(02:43):
deeper into that one.
Speaker 4 (02:45):
Yeah, thank you, Sean.
Speaker 3 (02:46):
Yeah, I got some good feedback on our airline analogy
that we made on the air together, so if you recalled.
We talked about people that it felt like they always
always could only be the first class and the the plane,
and that's how other financial advisors tell you. So we
talked about high investment minimums and things like that. So
(03:08):
just to make to tighten up the analogy, so we
kind of look ourselves as like airplane pilots, and we're
on the plane for your essentially your financial needs and
financial futures. So you know, in that we have constructed
our business so that we have kind of the do
yourself as a DIY people in the back. We people
(03:28):
can choose different stocks for us from so they called
Echo trade, and then we have our proprietary mutual funds,
which is essentially our economy plus option. And then we
also also have like the first club, first class why
global service as you know everyone else has as well.
But the main thing is that we're still the pilots,
so we're all going the same place. So you know,
(03:51):
if you we understand what your financial goals are and
we can help you, you know, plan that follows the
magic of like the power compounding as we talked before,
and we can minimum it's probably the probability of volatility
in developing risk and having the cashold to support your lifestole.
So going back to that analogy about airplanes, like we're
(04:14):
hoping to you know, take out the turbulence for you,
so you know, and again you know, if you if
you have the financial discipline to of saved one thousand
dollars in your life.
Speaker 4 (04:26):
You're ready to get on that plane.
Speaker 3 (04:27):
So you know you have to get on to to
help your future takeoff and your investments take off.
Speaker 4 (04:33):
So I just wanted to The key thing is just you.
Speaker 3 (04:36):
Know, get on the plane, get all get get to
the airport, get on that plane.
Speaker 1 (04:40):
And it's so important you mentioned you mentioned n even
you know, even making that small initial investment just to
start is I think for a lot of folks sometimes
there's there may be maybe they feel as though they've
missed opportunity, you know, they they see all these great
things going on the market, and they go, yeah, well
that stuff has passed me by. The reality is the
best day to start? I think. I think the line
is always the best way to start investing is yesterday.
(05:02):
The second best day is today. It's it's always a
great time to start that to start that investment, isn't it.
Speaker 4 (05:09):
Ye, It's very true.
Speaker 3 (05:09):
So people things like go, I like, I just that
doesn't apply to me. They go, this person had X,
Y and Z haptoms, so they're luckier than I'm like, no,
they you know, you all start in the same place.
You all start with the first step, so you just
got to go.
Speaker 1 (05:24):
It's a great day to make that first step as well,
as we talked this morning with Naton Tom Plum of
course with Wisconsin Capital Management. The website whizcap dot com.
That's w i s c ap dot com. Great website
and resource to learn more about Wisconsin Capital Management. Of course,
set an employment as well right online at wiz cap
dot com and talk to Tom in a moment just
about transitioning as well. You know, you spend all your
(05:45):
all your working year saving and then you get into retirement,
you guys start thinking, oh, I've got to start spending
this stuff. That is that is quite the shift as
we're talking with Tom about that in just a moment.
But real quick to Nathan, when you're talking about your
airline analogy, it was funny because my wife came to mind.
Is my wife is is like just she's and I
love her for this is She's a chronic worrior. She's
(06:06):
one of these people that no matter what, she's always thinking, Okay,
something bad is going to happen. And you're talking a
little bit about white glove service and like first class things,
I'm going to guess she's probably one of those types
that you would kind of refer to that. You know,
for her is it's not that she doesn't trust, she
just wants to be assured that everything's going well. And
we talk about some of the things you're able to
offer at Wisconsin Capital Management for folks that really want
(06:28):
to be kind of hands on and get that back
and forth information. You're very, very open to helping and
guide people. And maybe maybe those folks that are worried
suggest need a little reassurance. You guys are there for them,
aren't you.
Speaker 3 (06:41):
Yeah, And we preach balance and so you know, hopefully
we're designing these portfolios to hopefully mitigate the volatility. So
the worst thing you could do in our field is
scare someone on the off out of the market. So
if someone is so worried that just like I got
to go to cash, I go to zero, that is
always the worst possible.
Speaker 4 (06:58):
Thing you could do.
Speaker 3 (06:59):
So, you know, people on our field, if you choose
us or everyone else, is always good to you know,
try to get you to those hard points. And that's actually,
you know, my money well spent on a financial advisor,
that is for sure.
Speaker 1 (07:12):
Talking this morning with Nae and Tom Plumb, of course
of Wisconsin Capital Management mentioned the website whiz cap dot com.
That's Wi s c ap dot com. Hope you get
a chance to stay, to stop on buy the website again,
that's whiz cap dot com. It's no Tom. You can
get to Nathan and the whole team at Wisconsin Capital
Management a little bit more about them, and of course
you can also set an appointment right online at wiz
(07:32):
cap dot com. So Tom bringing you into this conversation.
It's weird to think about, but you know, we spent
so many years squirreling and building this next egg, putting
money away. We often think, I think, especially when we're younger,
like we're going to hit that We're going to hit
that goal, We're going to hit that number, we're going
to hit that date to retire, and it's going to
be just so easy to suddenly start, you know, opening
(07:53):
up this this vault and just spending this money. For
a lot of folks because of all of those years
of discipline and work and savings, it's not as easy
as it appears to kind of throw that switch, is it.
Speaker 2 (08:07):
No, Sean, a lot of people as they approach the
time of let's say retirement, because that's one of the
big milestones of people here. But as you approach that number,
you start to get anxious and you start to ask yourself,
how much do I need in savings for a comfortable retirement?
How can I do it? As Nate said, with the
(08:28):
least amount of anxiety, but actually start to move the
concept from being I need to save, I need to
save two I've saved enough now I can afford to
actually comfortably retire.
Speaker 1 (08:42):
Let's talk about some of the terms in some of
those some of those areas as we talked Tom about
about comfortable retirement are, what are some of the some
of the things we need to know about there?
Speaker 2 (08:51):
Well, Sean, I think the three things that we like
to talk about. One is the concept of a sustainable withdrawal,
And by that we mean that if you have a
certain amount of dollar amount of assets, and you'd like
to start to think about, what could I take annually
from my assets, from my savings that will allow me
(09:12):
a comfortable retirement today and to keep up with inflation
so that I will have a comfortable retirement in the
future and not run out of money. We call that
sustainable withdrawal. So we set up and look at we
have to have an assumption of what your earnings rates
will be, what the inflation rade will be, and what
(09:33):
timeframe we're talking about. But that's an important concept of
how much can I start to take out today and
be able to maintain that withdrawal rate for the rest
of my life. The second one is basically looking at
what are your true financial resources available to support your
cash needs. You may be asset rich, you might have
(09:57):
a very valuable house, you might have ar election, you
might have cars, but typically they don't provide cash flow,
so you need to be able to define what assets
are actually going to be there to support my retirement.
And finally, the time frame. Are you looking at your
(10:17):
life expectancy? Now you can put up variables around that
because most of us don't have the date when our
plan will end. But are you looking at your life
expectancy or are you looking at what we call legacy
for your children, your grandchildren, the foundation, the charities, anything
(10:38):
else that you might want to support beyond your own
life expectancy. So time frame is very important when we
look at that third variable.
Speaker 1 (10:48):
And you also think about that time frame as well,
and that variable, as we're going to talk a little
bit later on, are some of the risks to your
portfolio and other things, but time is definitely the biggest
asset you have. And as we start this conversation this
week off talking about the importance of taking that first
step getting started today's day to head on over to
Wisconsin Capital Management's website. That's wizcap dot com. That's wiscap
(11:11):
dot com. Get set an appointment right online, a great data
start that start building, building that portfolio, building that nest egg. Again,
it starts with a little step. If we've been looking
and interested, they'd love to get to know you a
Wisconsin Capital Management again the website whizcap dot com. That's
wiscap dot com. We're to continue our conversation with Tom
and Nathan. We'll talk about that inflation word. We'll also
(11:32):
talk about something you probably heard about and may not
know the history of, which is the with sustainable withdrawal
rate rate that some folks think as far as a percentage.
We've heard some numbers. What do they mean? What is
the actual withdrawal rate? We'll find out from Natan Tom.
We will do that next as ask the experts with
Wisconsin Capital Management continues right here on thirteen ten wib
(11:52):
A thirteen ten Wi b A and asked the experts
hanging out this morning with Tom and Nathan Plumb with
Wisconsin Capital Management. You can learn more about the guys.
You can learn more about Wisconsin Capital Management the team there.
(12:14):
They can also how they can help you, and of
course set an appointment right online wiz cap dot com.
That's wiscap dot com. When you get into the office
this morning. Check that website out against whizcap dot com.
I'm talking this week with Tom and Nate about some
really important things when it comes to comfortable retirement and
saving for a comfortable retirement. And of course in that
(12:37):
last segment, Tom, you had mentioned sustainable withdrawal, and I'm
going to put this on you, Nathan. I think a
lot of folks here about this. What isn't the four
percent rule?
Speaker 4 (12:46):
I think it was to.
Speaker 1 (12:47):
Explain explain what that is and a little bit about
the backstory there.
Speaker 4 (12:51):
Nate.
Speaker 3 (12:52):
Yeah, So a lot of financial planners use this kind
of like this withdrawal rate they have in these financial plans.
Speaker 4 (13:00):
Have you build and are they build?
Speaker 3 (13:02):
And the key thing assumption is that they're taking out
you take out four percent of your assets every year consistently, right,
So we find in real life that's a little bit different.
So again just to kind of go back to that
four percent rule. So if you have a million dollars
in your retirement and you're taking out four percent, that's
(13:25):
taking out forty thousand dollars a year. So even though
you're a millionaire and that sounds absolutely amazing and just
like an incredible number in the retirement, like you know,
forty thousand years, you're actually not that rich. So so
when you're talking about millionaires, you know, there's a difference
between you and talking about you know, a person with
(13:45):
one million dollars five million vers fifty million dollars.
Speaker 4 (13:48):
And then you get up to the you know, the
the people that hear bout the news with the one
hundreds of millions of dollars. But you know, you know, so.
Speaker 3 (13:58):
You know, a million dollars is a lot of money,
but it's very achievable for most people. So just you know,
just think about about the withdrawal rate and the four
percent to just keep that if you had a million dollars,
the financial planner is usually modeling that you're taking forty
thousand dollars a year.
Speaker 1 (14:14):
With that breakdown to Nathan as if it was a
Bill Bengen I think was one of the notes pointed
out it was kind of the guy that that authored that.
And as you were alluding to there that number, I
think for a lot of folks and folks that meet
with you are maybe surprise learned that the number might
be a little bit lower than than it actually in practice,
might actually be a bit more on my off on that.
Speaker 3 (14:34):
Nathan, Yeah, So yeah, again, when you're talking about a
million dollars, you're thinking about you know, Lamborghini's and you know,
really you know, effluent lifestyle things. But you know, for
people at the middle class, I mean, this is what
it really means, and this is what you know hopefully
you know, if you talk to an expert, they're going
to keep you within this range. The thing is that
(14:55):
you want to be balanced. I guess that's our mantra.
So you always had to have some assets are going
to grow because even if you're sixty years old, I
mean from a retirement standpoint, you might still be young.
We're hoping that you're going to live till nine years old.
So you got to invest, you know, in a way
that was conduce so to actually making that number. So
(15:16):
you know, we find that being bounced in socks and bonds. Again,
the stocks are the growth engine and the portfolio the
bonds are kind of like almost like a shock absorber.
They're trying to keep the volatility of the turbulence down
of the portfolio. We find that that is pretty much
an ideal miss mix, and that's what you see a
lot of these endowments, foundations, pension plans. They usually have
(15:36):
a similar asset allocation to the sixty forty.
Speaker 1 (15:39):
Doggin this morning with Nathan and Tom Plumb. Of course
they are with Wisconsin Capital Management. The website whizcap dot com.
That's wiscap dot com. You can learn more on the
website about Nathan, Tom and the whole team at Wisconsin
Capital Management. You can learn more about them, a little
bit about their history. Also very Important've been looking to
set an appointment get to know Nate and Tom. All
I gotta do is head over to that web sa
(16:00):
wiz cap dot com. That's wiscap dot com. You can
sent appointment right online. The inflation word, I kind of
get shivers. Me mentioned that, but that is and Tom
correct me if I'm wrong. Quite possibly the biggest risk
to all of this to your savings. Is that erosion
of spending power because of inflation.
Speaker 2 (16:21):
Yeah, so we've talked about in the past. Time is
a great friend when you're looking at your compounding for
your rate of return, building up your assets and your
financial security. But it also has another side to it,
and that is inflation over time can be the biggest
deturned to actually being comfortable in your later years. So
(16:45):
you know, when we look back at the last one
hundred years and when Bill Bengen, who started this whole
idea of four percent twenty years ago, he's revised his
numbers because the actuality is that there's only been one
time when you've had a combination of the stock market
going down and inflation going up so that you ended
(17:10):
up not being able to withdrawal initially four point seven
percent almost five percent from your retirement assets. Now remember
these aren't your only source of retirement income. You'll also
have social Security, some of us actually might have a
pension or something like that. But when you look at
(17:30):
your actual financial assets and you think about what that
could happen to them to prevent you from reaching your
goals or in later life being able to sustain your
buying power. Basically, inflation is the big enemy. In nineteen
sixty eight we started out at that time, we had
(17:53):
then two significant stock market corrections in the next ten
years at the same time that inflation started to accelerate
from six percent to nine percent a year. That's the
worst of all worlds. If you don't have on nineteen
sixty eight. Now that's one in one hundred, So it's
(18:14):
still possible. On average, the sustainable which all rate has
actually been closer to seven percent. So it depends on
how conservative you want to be and how you structure
your investments, and whether or not you structure them in
a way that you can be a long term investor
with a portion of those assets.
Speaker 1 (18:34):
Talking this morning with Tom and Nathan Plumb with Wisconsin
Capital Management Online wiscap dot com. That's wiscap dot com.
Don't forget if you miss any part today's program and
listen back to this in previous shows all at the
website wiscap dot com. You also set an appointment right online.
And as we talk about some of the risks out
there to your portfolio. Obviously, as Tom, as you mentioned,
(18:55):
inflation is big, but Nate also volatile investments and holding
on to things that may not be worth holding onto.
Let's talk a little bit about that, Nathan.
Speaker 3 (19:06):
Yeah, So often in down markets, when people get scared,
they want to kind of sell the the assets are
the most down during a financial correction. So again, if
you're modeling this out as kind of financial planning, you're
planning that the out of a ten year rolling period,
you're betting the market go seven or seven and a
half of the ten years, right, So there's going to
(19:28):
be some corrections, there's going to be some down periods.
Speaker 4 (19:31):
So what do you do in those down periods?
Speaker 3 (19:33):
A lot of people panic and they want to sell
the kind of like the high growth asset, and usually
means stocks. And again just stocks are you're buying ownership
of companies, right, and so people panic can kind of
sell those because they see they're down, right, And that's
actually kind of like the thing you really want to avoid. So,
I know, it's an emotional decision. No one likes to see,
(19:55):
you know, things going down. People think, oh my gosh,
I can't lose any more than i've lost.
Speaker 4 (19:59):
Now, you know, you have to really.
Speaker 3 (20:03):
You know, try to you know, understand these type of markets.
So that's why we've preached balance, and that's why we
kind of preach you know, you should have your money
in essentially different buckets, right, So you should have some
savings essentially if you have something in checking or savings
or CDs, I mean, you're not really saving money. Usually
those interest rates you're getting on are just what what
(20:24):
is inflation or what currently is inflation? Right, and then
if you have some money that that you need the
next uh, you know, three to seven years or that's intermediate.
So that's a really good part to be balanced. To
be in stocks again, ownership of companies, that bonds, liability
of companies, and then you know what's the far off future, right,
so that you could be a little bit more stock heavy.
(20:45):
So it's usually not the wisest thing to adjust during
these kind of down periods in the market. So you
want to stay consistently in here and that way, if
you're balanced and you're not going to scare yourself, you're
going to stay into the market.
Speaker 4 (20:57):
So I guess that's you know what we kind of
preach here.
Speaker 3 (21:00):
So we preach balance, and you know, don't put all
your bigs one basket and just really you know, make
sure that you kind of anticipate like when things go wrong,
so otherwise you just come don't feel.
Speaker 1 (21:12):
Panicked, building really important and well balanced portfolios. This morning,
as we talked with Nate and Tom Plumb, of course
they are with Wisconsin Capital Management and Nate before we
wrap this week, you know, there's ever so often things
you'll see coming up on the calendar really important to highlight.
And you mentioned coming up not too long from now.
Folks looking to purchase a car may want to pay
(21:33):
close attention, shouldn't they.
Speaker 3 (21:35):
Yeah, So if anyone that's been thinking about buying an
electric vehicle, the EB tax credit of seventy five hundred
dollars goes away as of later this month, which is
September thirty, twenty twenty five. So if you've been on
the fence doing that, you should go out there this
monthing and make it happen.
Speaker 1 (21:53):
Really important, great guidance there as always talking this morning
with Tom and Nathan Plumber, of course friends from Wisconsin
Cap Management. Online whizcap dot com that's Wi s c
ap dot com. On the website whizcap dot com you
learn more about Wisconsin Capital Management. You can also set
up an appointment right online. Whizcap dot com again, that's
w I s c ap dot com. Tom, Nate. It's
(22:15):
great chatting with both of you. Guys. Have a great day, Tom,
you take care.
Speaker 2 (22:19):
Thanks Shawani you have a good day too.
Speaker 1 (22:21):
Nate, you have a great one also.
Speaker 4 (22:23):
All right, thanks Sean, appreciate it.
Speaker 1 (22:25):
News comes your way next right here on thirteen ten
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