Timing, Planning, and Adapting: Navigating Financial Waters with Mark Newfield

Hannah Mitrea 0:05
Get ready to get your questions answered by financial advisors. Learn how to put more money back in your pockets regardless of where you’re starting your financial journey with your host, Hannah Mitrea Welcome back everybody to virtual financial advisor Podcast. I’m so excited to have Mark Newfield. Here with us mark is a CFP, and an RICP. Mark is also the Managing Director and wealth management advisor at Journey Strategic Wealth. Welcome to the show, Mark.

Mark Newfield 0:34
Thank you glad to be here.

Hannah Mitrea 0:36
Yeah. And so tell us just kind of like a little introduction about you on what it is you do in the financial world.

Mark Newfield 0:44
Okay, well, I mean, I’m primarily a client advisor. And we believe that financial planning is what matters. Yes, you need to be good in investment management and some other things. But without a plan, none of that other stuff really matters. So that’s kind of what I do. Now, you know, what does that mean? If you go to my sub stack, you’ll see that I wrote something called dazed and confused a couple of weeks ago, which actually got quite a bit of reading, is it confusing market, there are lots of different definitions of and no settled definition on what a financial adviser or wealth management advisor is, I look at it as what we deliver is a process of financial planning, whereby a human like you or Darion tells us their story from past the present. And then what we do in collaboration with you is intentionally compose a story of your financial future, then we set about the doing the work of achieving that financial future. That’s kind of what we do without, I mean, you can put a lot of technical stuff in there and 52 different deliverables that we create, but in my mind, that’s what we do.

Hannah Mitrea 1:52
Awesome. And then I know we’re going to be talking about financial planning today. So kind of give me like a really quick synopsis of what is financial planning?

Mark Newfield 2:01
Well, think of what it is right is taking your present and projecting that into the future and then achieving that. But I mean, you know, in terms of what it might encompass is like understanding and managing your spending and saving, evaluating, selecting, implementing and monitoring investment accounts and their allocations and their performance and individual investments in those accounts, you know, making sure your taxes are done properly. I’m not a CPA, but we do help clients with tax planning, and make sure their taxes get done business and personal and domestic and foreign money and a lot of ways. It’s not just building the plan, it’s making sure that things get done. Now, most people like to do a lot of other things other than spend their time thinking about getting all their financial stuff done.

Hannah Mitrea 2:50
As I feel like, the fun part is the doing that definitely is a harder

Mark Newfield 2:54
doing is the hard part. So for me, creating a plan and then not implementing that or making sure that it gets done creates a very expensive paperweight. But it also makes sure your state planning is done properly. We do things like looking at employment agreements and operating agreements for small businesses, you know, making sure you have the right CPA, the right attorney, and it might be multiple attorneys depending on what you’re doing. And then probably fundamentally implementing a repeatable process so that you do it all again on a regular basis. Because everything changes, there is zero about your life that is static. Having a static financial plan and a dynamic life doesn’t make a lot of sense to me.

Hannah Mitrea 3:33
And you mentioned something at the beginning of like financial plan is your present to your future. So what is so important for individuals to be able to plan now? What is that doing for their future?

Mark Newfield 3:44
Well, everybody’s going to be different. I look, I was a software engineer and a software project manager, which is very much a corollary in a prior life, wherever you get to without a plan is an accidental arrival. And if that’s the way you want to live, that’s okay. Don’t plan. I’m not passing judgment on it. But if you want to achieve something other than an accidental arrival, you need a trip plan. Yeah, I mean, I live in Richmond, Virginia. I mean, the the primary path to Florida is i 95. But you don’t have to go that way. You can get on 301 and route one and 17. And you can zigzag in and out east and west. You’ll still get there. Like, damn, you can take an airplane, right? I can do it in an hour and a half or I can do it in 30 hours. There’s no right or wrong to either one. Right? Do you want to arrive accidentally or do you want to arrive intentionally? Most people in my experience, given a choice would do something intentional.

Hannah Mitrea 4:44
For some reason I forgot your Virginia sedans. Austin Virginia could really close

Darion Robinson 4:50
that. Darion, I’m actually in Winchester, so Okay, so you’re

Mark Newfield 4:53
west, north and west of me. Yeah. Where are you? My wife. My wife grew up in Warrington. Oh, very nice. Where are you now? I’m in Richmond. Okay. I grew up in Arlington, Fairfax, Alexandria and Falls Church. Yeah. Okay. Yeah. Used to be the country baby. Yeah. DC.

Darion Robinson 5:13
I know, oh my gosh, everyone’s moved out this way. So it’s insane. Very much. So it’s, you know, the

Mark Newfield 5:19
fact that you can have a major traffic jam in Leesburg is almost beyond me. Tell me

Darion Robinson 5:23
about it. So both my wife and I used to work in Ashburn. And when I tell you morning drive easy, get there in 15 minutes going home? Oh my gosh, it’s an mark. It’s like two, maybe two and 15 minutes to get home now. It’s insane. Everyone’s thinking this way? Yeah, exactly. No, thank

Mark Newfield 5:42
you. Anyway, I live in Richmond. Yep. Good, good.

Hannah Mitrea 5:47
Awesome. Well talk to me about like, what are the steps that you take with your clients, when you’re going through and starting a financial plan?

Mark Newfield 5:54
Well, the first thing we have to do is agree on scope. But I’m actually not very flexible on scope. I think that you don’t do partial financial plans, you don’t just do retirement plans, you don’t just do college plans, you do all of the above. And I’m kind of an all or nothing person on on that side of things. But fundamentally, what we do is spend some time nailing down what your current financial vision is, everything that we end up crafting depends on what it is you really want to accomplish. So the first thing we’re going to do is spend time figuring out what it is you want to accomplish. And for many people, it’s the first time they’ve ever written down. That also means if there are multiple parties to the plan, you know, spouses or a committed partnership, or whatever you want to call it, by the way, I don’t care what you call it, they’ve never talked about money before in any meaningful way. So we want to nail that down and get everybody deciding, at least for now, what is the desired outcome as much as you can conceive of, and it might just be saying, hey, next year, I want to be here, not everybody has a 20 or 30 year vision of where they want to be. And that’s completely okay. But that’s the first thing we do is nail down what the current state vision is, then we’re gonna figure out what the spending plan is, how do you actually want to spend your money which is informed by how are you currently spending your money, then we’re going to figure out what the saving plan needs to be, in order to achieve what it is you said you wanted to achieve, then we’re going to figure out what the gap is between those two things. And then we’re going to figure out two or three ways to close that gap by being very mindful of how you think about money. What is important to you about money, what you know about money, we have a very large portion of people in the United States that have never been taught anything about money. So that conversation can cover a very wide range. But the net result is to get onto one page, no more than one page. Here’s where you currently are. Here’s the gap between where you are and where you say you want to be. And here are our recommendations for changes to make to start to push you down that path.

Hannah Mitrea 8:01
I like that. You kind of had the short term, it doesn’t always have to be a 25. Year.

Mark Newfield 8:07
Whoa. And for you, you know, you were probably about 70 years old. Thank you all those what they want to be doing 50 years from now when they’re 30 years old. Nobody know. And when I was 30, I was just graduated from college, you think I knew I was gonna be where I am today. You kidding? I just want to get a job. It was broke.

Hannah Mitrea 8:27
Like, yeah, I definitely did not know out of college anything like?

Mark Newfield 8:31
I mean, did you intend to be an agency owner? You know, you’re getting business?

Hannah Mitrea 8:36
No, maybe mean? No.

Darion Robinson 8:39
No, no, I’m either. It poses a good question now. So for you personally, obviously, this is not the route that you thought that you were gonna go down. But here you are now. So we’re kind of some of the steps that you took to gain the financial literacy that you currently have today.

Mark Newfield 8:52
Well, I had a really good college professor, the School of Accounting at VCU, which is where my degree is from, but he just he told me to read the Wall Street Journal every day. And so starting in college when I was I guess, 2627, I didn’t start college until I was 24. I started reading BusinessWeek, which is different now I think, and the Wall Street Journal, and Forbes and fortune, every edition, every issue. And I just got interested in the personal finance stuff that was in there. You know, I mean, I was studying business and cashflow businesses and things like that. But that wasn’t really my interest in the financial services business. It was in personal stuff. And I just got really hooked on investment management as it just was something I found fascinating and a big problem and a difficult problem. And that was the genesis of my interest. I just didn’t end up pursuing that until I was 46. I just took a different path, but it was always my passion, but that’s how I got interested. You’re just one of those things. It’s kinda like some people learn that they love to paint. Yeah, I like figuring out personal financial things, and business financial things.

Darion Robinson 9:59
So good segue into that as well. So you said you didn’t take or at least embark on this journey until 46. What was it at that age of 46, the moment in life a time, whatever it may be, that allowed you to take that step,

Mark Newfield 10:12
I’d had a successful corporate career, I was miserable, doing what I was doing, the money wasn’t enough to keep me motivated and connected to that I’d always had this passion. And I’d had several of business associates of mine who were very successful financially, say to me, that if I ever went into this business, they’d hire me. And I’m an accidental entrepreneur, but I’m at least smart enough to look at it and say, hey, there are people with money, who are willing to pay me to give them advice. Maybe I ought to do that. And I was just thoroughly dissatisfied with my corporate career. Plus, I had a 10 year old at home that had some issues. And I was kind of tired of traveling for five days a week and working 70 hours a week. So there was a mismatch of what I needed for my personal life and what I wanted to do professionally, and I kind of had a friction point there where I could say, Hey, you can keep doing what you’re doing, you’ll be able to quit work. And when you’re 55, according to the way that you currently spend, you’ll have access wealth, your family will probably be a shipwreck, and you’ll be miserable, but you’ll be wealthy. Or you can try this, maybe you’ll fail, maybe you’ll have to go back to the other thing, maybe you won’t. And I didn’t want to be 65 I’m 66. Now, I didn’t want to be 55 Looking backwards and saying Coulda, Woulda, Shoulda. And I have enough of a risk mentality to do it. So I threw away a, you know, very lucrative and equity enhanced corporate career to go earn nothing, and hopefully build a business.

Darion Robinson 11:45
When asked one more thing, and I’ll hand it right back over to Hannah, the key part there that I really like. And it goes a lot with what we talked about on my personal podcast as well. But that risk management mindset that you currently have and have had for a very long time. Do you think that’s something that can be developed?

Mark Newfield 11:59
Well, sure, it can be developed. But I also think that there are some people that their fight or flight mechanism is so flight oriented. And that’s not a bad thing. It’s just who you are. I’m not being critical that they can’t stomach the risk of being self employed. They just can’t. And that’s okay. Maybe they’d be better off doing it. But I mean, you got to get over the hump like my wife would never, ever do something like this. And I’ll tell you when we were living in Mechanicsville, which is north of Richmond, some years back, well, actually many years back, and we’re 301 hits route 288. There was a Richmond beltway that kind of got built. I mean, your DC area familiar with the beltway, obviously. Yeah. And there was a major intersection there. And my wife drove by it one day and said there ought to be a McDonald’s here. Yeah, I was like, let’s do it. I mean, I was working corporate America, we had some savings, we could have done the franchise fee. I was like, let’s do it. Quit your job. She was working for Circuit City at the time as a quit your job. Let’s do it. My wife is a very good manager of people, and a really good leader. And she was like, oh, hell, no, I’m not doing that. Well, let’s fast forward 25 years that McDonald’s is the number one revenue McDonald’s in the McDonald’s system. We would be I don’t know how much wealth we could have generated off of that it would have been millions and millions of dollars. She just didn’t have the risk tolerance for it. My wife has lots of good ideas like that. Probably once a year. I’m like, we ought to monetize that we ought to do that.

Hannah Mitrea 13:31
It’s our secretly doing it behind for her and then to this a gift for Christmas. Look, you now have McDonnell,

Mark Newfield 13:37
that would be hard. Good luck on that. One. She’d throttle me for putting the money in it. Yeah, probably not actually. But I mean, that’s, I don’t want to be a McDonald’s franchise owner. That’s not my gig. That was her gig. We made a fortune. But right or wrong. It just wasn’t right for her. And that’s okay. So it’s really, uh, you know, we have this whole thing in this business about risk tolerance around investment, right. Yeah, that’s a very practical application. Like when we’re helping clients figure out how to manage their money. Yeah, we use a risk tolerance tool, we use the risk alized tool, but when it no matter what the score is, I come back and they’ll look you in the eye and say, Okay, pick your number. We’ve got a million dollars here. Is that million dollars is $500,000. Next year, are you firing me? That’s a much better picture of risk tolerance than somebody score answering some questions. Right? Yeah. Yeah. And you just never know. But some people just, it’s just not in them to do it. And that’s okay. But can it be learned? Sure. Yeah.

Hannah Mitrea 14:36
And that’s all I can kind of ask, as you mentioned, you know, you fell in love with the investment side and learning that side of it. And then also how so many people don’t learn anything about money. And then we have the risks out of it. So how do you bring investments into people’s lives, like and start explaining that to them because investing your money is a huge risk, and especially if you’re uneducated in compound interest and all All the other things that go along with it. So how do you teach somebody about investments so that they can start getting that interest and making that part of their financial plan?

Mark Newfield 15:09
Well, there are some relatively straightforward concepts that are all that we really focus on with most clients. Some clients really want to get into the nitty gritty of of how we do that, and that’s fine. But most clients don’t. They’re hiring us because they don’t want to get into that. But from an education perspective, I’m very careful about the use of the word risk. Because nine times out of 10, the person on the street, when they’re looking at their bank balances or investment account balances, they view risk as what is the probability that I’ll lose some or all of my money, literally lose it and never see it again. And it scares them to death as you would expect. Money is a very central concept at this point of human makeup. In 1000 years ago, it wasn’t but today it is money is kind of sorted. As a Cyndi Lauper song, I think money is everything, or money equals everything. So I go back, the first thing I say is, first of all, in any decently run investment strategy, your risk of actually losing money over any period greater than about eight or nine years, is as close to zero as it can be. Now, in a given year, could your balance go down? 50% 100%? Yes, it could. If you’re young and you are aggressively invested, we will have a year like 2008, or 2000, or 2018, the fourth quarter, when you will see a significant drop in your account balance. But the only way you’ve actually lost money is if you make a withdrawal. And our job is to prevent you from making withdrawals at the time when you most want to do it. Because we know that if your money stays there, at least mathematically, and at least to date, it will return to its prior value and more. And I have a chart on my wall here from 1925. That can prove it to him. Okay, now can I guarantee that you will never, quote lose money. And by that I mean, the dollar you put in, you only get 50 cents back later. You literally physically lost it. No, I can’t guarantee that. But I’m as mathematically sure of that as I can possibly be given any decently diversified investment strategy. So that’s the first thing. The risk that you’re worried about is statistically very small. The other thing that that we say, and you’ll see it in actually, this week’s video is, if you want to create financial wealth, you cannot interrupt compounding. Because we don’t know when that big up year is going to be in last year, for example, is one of the worst years in us investing history this year is one of the best could I have told you last year was going to stink? No. Could I’ve told you the beginning of this year was going to be awesome. No, if we interrupt compounding, and there’s some data out there that shows that like over the last 20 years, if you’d miss the 50 best days in the US stock market, you would have made literally zero on your money. We don’t know when this 50 days are gonna be. So you have to leave your money in. And the point at which you want to really pull it out and it’s making you nervous is when you’re earning compounding credits. But you can’t get those credits if you’re not invested. So two fundamental principles, it’s highly unlikely that you will actually physically lose money. And you have to leave it in the account in order to make money. So one things I focus on the most, the next thing that comes along is how much you save is far more valuable than what the rate of return on your savings is. So if we can get you to save significantly, or at least sufficiently, and pick a decent strategy, which is our job to help you pick a decent strategy and leave it alone, you’re going to do better than most of the population. And there’s a study out Morningstar publishes it every year. But it just came out a couple of weeks ago called Mind the Gap. When you look at a given investment, and its rate of return over a calendar year. And then the basket of invest tours, the investment tends to out earn the InVEST tours by 1.7% on average annually compounded over the last 20 years. Now how can that be the investment itself? The s&p 500 index fund out earns the investor who bought that s&p 500 index fund by a decent sized percentage about six tenths of a percent. And if you compound that over a long period of time, it’s actually a lot of money. Yeah. It’s because of the timing of the investment decisions that investors make. They put their money in when it’s going up, and they take it out when it’s going down. Well, that’s the exact opposite of what you want to do. Okay, well put your money in when it’s down and leave it in when it Stop. Yes. Understood. So that’s about all that I talked to most clients about. Yeah, somebody wants to get into the nitty gritty of why we have a particular investment allocation and why we chose these asset classes, and how they interact. And statistically why we did this and what we expect mathematically and expected rates of return and all that stuff, I’m happy to have that conversation. Almost nobody wants to have that conversation. They want some level of assurance that if they do the right thing for a reasonably long period of time, they will succeed.

Hannah Mitrea 20:33
Now, I was gonna ask, you mentioned, like, different strategies. So what do some of those different strategies look like for somebody coming in wanting to financial plan?

Mark Newfield 20:43
Well, now we’re talking about, are we talking about planning strategy? Are we talking about investment strategy? Both. So one is driven by the other. Right, but part of it, a lot of it goes back to what your financial vision is, what is your financial position, if your financial vision Hana is, I want to have a really good time right now, and enjoy all these experiences. While I’m young and healthy. I’m not gonna worry about the future very much right now. That means you’re probably not gonna be saving very much right now. Okay. Now, fundamentally, do I want you to make sure that in your 401 K plan or retirement plan, you’re doing something? And then it has a reasonable strategy? Yes. You know, what, I’d be happy about you saving nothing? Well, not for a long period of time, but for a relatively short period of time, a couple of years. Sure. We saw about your vision. So, you know, there’s planning strategies associated with what your vision is. But from an investment strategy perspective, first of all, we’re going to figure out what your volatility tolerance is. Now, in this business, the technical term is actually risk tolerance. But I’ve already talked to you about what I think risk is, from a client perspective, what risk is from a client perspective is not the same thing as what risk is from an investment manager perspective. So I’m talking about volatility tolerance? Could you tolerate your money going down 50% in a year? The answer is yes, we’re gonna have a pretty aggressive investment strategy. If the answer is no, I’d want to pull it out. And I’d be thinking about firing you, then we’re not going to be that aggressive. Now, fundamentally, do we want you to have money across at least six or seven different asset classes or different kinds of investments? Absolutely. It might be more, but those are the basics of investment strategy. And, you know, I would call and again, you can do it very simply, right, you can buy one US stock fund, one international stock fund and one bond fund. That’s the old Bogleheads, free funds strategy. That can work just fine. You can do something more sophisticated, we tend to do something a little more sophisticated. But there’s, in a lot of ways, no right or wrong in that the right or wrong is doing it for long enough for it to work. I’m pretty flexible when it comes to investment strategy. Most importantly, I want you to deploy something that you’ll stick to and you won’t change when it’s all looks like it’s going south, that’s been

Darion Robinson 23:04
one of the big focal points here is sticking to something that’s going to work and not changing, right. But life in itself is always changing, right? Our plans always changing meaning, as you were mentioning for someone that’s young, they may want to party may not save a lot. But what happens when they start to enter different stages of their life? Like if I want to start a family? Well, my life changed, my adjustments may need to be made then then after that closes out that stage comes to an end, I’m going to retirement now what does that look like? So with that being said, how do we make adjustments as our life makes adjustments?

Mark Newfield 23:35
Well, so no matter what you tell me up front, I’m going to build a plan that crosses your lifetime. Okay. Right. And I’m going to come back Darien and say, I hear what you’re saying. And I’m just going to tell you that if you sustain that behavior for a long time, there are back end consequences. Now, it’s a lot of times hard, especially when you’re younger, to consider the consequences. 20 3040 years from now. Yeah, it’s very easy to say to yourself, it’s okay, I’ll catch up. But part of working with somebody what working with somebody like me does for you is we’re then doing review every year and showing you the consequences of your actions. That’s going to influence your behavior going forward. But certainly, your plan is going to change. Your plan is a static device that is essentially wrong the minute we finish it, which is why we keep refreshing it, because everything does change. You know, you get a big unplanned promotion or you get an inheritance or god forbid your spouse dies or your child dies. Or you’d say you’re never going to have children and then you do, which was my particular situation. I was never going to get married and never have children and I was wrong on both counts. So what you do is you replan that’s what you do, and then you assess where you are given that And is it true that a lot of people don’t save much money while their children are young and through college? Yes, children are expensive. You want the best thing for your children most people do. So you expend a lot of resources, time and money on them? Does that mean you have a lot of catching up to do later? Yes. Does that mean you might have to adjust your lifestyle later? It could mean, these are planning conversations that we have on an annual basis. I don’t know the answer. Yeah, I agree, you know that by the time you get to the point where you no longer want to work, I really don’t call it retirement anymore, because most people keep doing something. And then more committed more successful people, a lot of times continue earning an income of one kind or another for a long time. But what they do want to get to is a point in which a point where they don’t want to have to earn an income, where they could walk away and have freedom of time. So what we talk about with people is how do we build an environment where you can choose freedom of time, how you spend your time, and where you spend your time, and I kind of encapsulate it this way, at some point, you want to do what you want to do, when you want to do it with whom you want to do it for as long as you want to do it without worrying about the cost of doing it. And so, yes, your plan changes dramatically. Between the day you graduate from college and the day you stop earning an income.

Darion Robinson 26:15
Would you agree with me and saying that when you’re selecting a financial advisor to take on this task with you, you’re also selecting a lifetime partnership? Because that’s what it sounds like. Ideally, you

Mark Newfield 26:27
are, okay, no, does somebody go through their entire life and never change their advisor? Know, there are situations where we see advisors get changed a lot when a spouse dies, when they reach their, you know, retirement age, I’m just using as an abbreviation really, you tend to see a lot of advisory changes in very bad markets, you tend to see advisor changes. Yeah, but what I would say to you, and also like, I mean, I’m 66, I’m not going to be here forever. We have clients who are 40 years old, they’re your advisor is going to change, they’re not going to let as long as you live. And even if they do, they’re not going to keep working until the day you die. Right? Yeah. But I think you should look at it as a relationship that is just as trusted as your doctor where you can go have very open conversations about what’s going on in your life, and have somebody who can listen to that and translate it into, well, if that’s what’s going on in your life. This is what I would recommend financially. I don’t know about lifetime. But I would say that the best advisor relationship for you is one where that person is an adviser, and somebody you really, truly deeply trust, and chances are good, they’re going to become a good friend of yours as well. And guess what, we want the same thing. I can’t do a great job for you, if you don’t tell me what’s going on in your life. Right? I just can’t, I’m not saying I would give you bad advice, it’s probably not going to be the best advice. If you’ve got a miserable time at home. And you’re thinking that you’re not going to be married in two years. And you don’t tell me that I’m probably not going to be very helpful, now creates a conflict for me, because I’m serving both spouses. And I’m then going to have to choose somebody. You can’t serve both spouses in a divorce you just conflict of interest. But I mean, I can’t give you great advice. If I don’t know that that kind of stress is going on in your life, because my advice is going to be are you guys getting counseling? Right? It’s got nothing to do with money. Are you getting outside help that you need? Or have you just decided this is going to happen? That has nothing to do with your money and everything to do with your money at the same time?

Darion Robinson 28:46
Yeah. So one more for me, and then I’ll let Hannah, close out the rest of it. But again, segwaying off of what you just said, have you gone about handling difficult discussions like that?

Mark Newfield 28:58
Well, twice in the last five years, I’ve had to say, to a divorcing couple, I can only work with one of you. And this is my choice. And what we did with the other spouse was assign them to another advisor in our firm. Now, in one case, they went left because they really wanted to work with me. And I think they were I knew the first spouse. I knew the other spouse first. And that’s just where I felt my loyalty ought to be. Right. I know they’re divorcing spouse was getting more out of the settlement. I mean, financially, it would have been smarter for me to stick with the other client. Right. But I mean, I had to make a choice. Because I don’t see why I can serve two masters. And in that particular case, it turned out to be true because the other spouse was asking us to make sure that their ex spouse was going to regularly fill up the account for child support. And I’m like, that’s you guys have to work that out between I can’t be in the middle of that. Right? That’s a legal arrangement you have With the courts. But that’s a good example of, you know how you can really get bound up as an advisor trying to serve clients where the clients have conflict between them. The Darion and it’s sometimes it’s hard. I mean, you don’t want to say no to somebody, but you have to.

Darion Robinson 30:16
Yeah, it sounds like low tea is one of your principles. And I love that very

Mark Newfield 30:20
much. So it’s one of my life values. Right? Doing the right thing, loyalty to the folks you choose to serve, it actually creates a bit of a business problem, because you end up with too many clients. Yeah, you can do really good work, nobody ever leaves. And the churn in this business is usually about 10, you know, eight to 10% of your client base, that is you have 90 to 92% retention, while retention is 99 point something percent, you know, doing a hell of a job. Well, thank you. But it also creates a business problem, because you’re like, Okay, I’ve got these clients that if I keep doing this, I don’t have time to serve them. Right. Right. So But anyway, it’s a good problem to have. But yes, loyalty is very much one of my values. Very good.

Hannah Mitrea 31:08
Gotta flow. So you mentioned that one of the top two times for somebody just switched their financial advisor, one of those times is when they’re going through retirement, and how we understand that why would somebody spend their whole life with you, helping you like you’re helping them grow their retirement, and then as soon as it happens, or like, actually, now we’re gonna switch?

Mark Newfield 31:27
What doesn’t happen to me. But here’s the reason why. There are lots of people in this business who are good at helping clients accumulate money. But they the retirement conversation is a deep accumulation conversation. You were spending down your money, or you’re trying to maintain or maybe even grow your principal, but you’re spending a portion of it, that is a different problem, and a much more complex problem. Which is why have they are ICP retirement specific certification? Okay, it’s a whole different math problem. And it involves behaviors. You know, I mean, at some, there are times when we have to sit down and tell clients, you cannot spend at the rate you’re spending and us feel good about probabilistically your money lasting as long as your life is likely to last. But that involves a whole bunch of things, it is a much more difficult calculation than if you put in x amount per month. And you know, the average compounded rate of return of the s&p over the last 90 years, 30 years from now, you’ll end up with this much. That’s a very simple future value calculation. Gotcha. Making your money last as long as you do. Should you annuitize some of it? Should you not? Are you trying to leave behind as much as possible? Or do you want to die with your first check bouncing on the top of your casket? Very different conversation? So a lot of clients realize when they get there, that their advisor is just not the person to help them through the 30 or 40 years of their life or maybe more with their deep cumulating.

Hannah Mitrea 33:11
Understood, okay. Is there something you would look for at the beginning, though, like, like you said, like, I have no plans on retiring, not even the next 30 years to retire, realistically. But when I’m looking for a financial advisor, when I’m younger, am I looking for that person that can be there for the click accumulation as well, or, you know, at the end of the day, that priority is making as much money. So when I retire?

Mark Newfield 33:38
That’s a really good question. And I have two answers to that. One would be well, sure, but realistically, and if that person is either older than you, or even a similar age, they’re not going to be there for you when you get there anyway. So that’s one answer. The other answer is obviously, advisors change over time. And I got the RSVP designation, some years after I got my CFP designation, because I realized how important it was to our clients. So really good advisor is going to change with you. Yeah, I would say if you’re 30, that that is not a I wouldn’t have it in the priority set. But it’s not a bad thing for that person to know how to do. Because chances are good, whoever you choose, if they’re really good and you really like them, the person that they choose as their successor is going to be pretty similar. So while you might not be with the same advisor, you might be with the same advisory team. Gotcha. So I would say I would look for those skills within the team but not necessarily in your advisor. Your advisor has to be somebody that you really mesh with, if you’re going to stick with them a long time. And do they need to be skilled in in where you are and what you’re doing at the time. 100% I mean, there are probably advisors that specialize it’s not our specialty I mean, I feel perfectly competent, but that specializes in working with owners of, of marketing and branding agencies. And why wouldn’t you want to work with somebody who understands your business problems? Right? That makes a lot of sense.

Hannah Mitrea 35:17
Definitely. I was gonna say, I really love that and kind of mentioned at the beginning. So, so many advisors I’ve talked to, the focus is always just their time outside of it. At the end of the day. Yes, we have to save money for that. But I did love that you mentioned like, how are you living now? And I really appreciated that, that you if you

Mark Newfield 35:33
want to build a collection of Corvettes, yeah. What if that’s important to you? How do we enable that? And also keep you on the path towards your longer range? Thanks. I mean, I get that, but what am I supposed to do Trump all of your current life so that you can maybe live better in the future? And what if you don’t live that long? I don’t know where you’re gonna be 30 years from now, nobody does.

Hannah Mitrea 35:58
Like I’ve talked to an advisor, and they only have like, our whole expense sheet on it. And they’re like, Well, can you get date night to be less expensive, is like, narrowing down the little things online. But those are the things you enjoy. So

Mark Newfield 36:09
you’re never going to have that conversation with me. What I would look at and say, Hey, Hannah, based on what you told us, we would like to save you saving X dollars per month. Yeah, if we can get those x dollars per month saved. I really don’t care how you spend your money. You want to buy Range Rovers and gold teeth or whatever, go ahead. You know, I mean, try not to do anything that would, you know, personally injure you. But go ahead, you’re gonna have a great date night. Go ahead. I don’t care how you spend it. What I care about is are you saving adequately to get to where you want to go? Because if you’re not, then we need to have that conversation. Because we either need to adjust how much you’re saving, or we need to adjust the desired outcome. Or we need to say we’re going to defer that for later. Recognizing that you’ll have to save a lot more later than you do today. I want you to be informed. I’m not going to pick through how you’re spending your money and say you shouldn’t do X, Y or Z. Right? Yeah. You know, now, if you’re spending $2,000 a month on alcohol, I might be like, Are you sure you want to be doing that? alcohol counselor? Yeah. I mean, really, I’ve had that conversation, I’ve referred people to 100%.

Hannah Mitrea 37:23
Because a lot of the either I feel like it really starts to breaching the, to the therapy, you’re really

Mark Newfield 37:28
I’m no therapist, I have therapy too. But I have to be very, very cognizant of your behavior, and your habits, and how that’s helping you’re hurting you financially. Right? That’s what I’m very careful about and actually work with a group on this, I’m very careful about venturing into the world of therapy very.

Hannah Mitrea 37:51
That’s awesome that you’re helping people find the places that you need, and, you know, regardless of where they are at in their life, and the

Mark Newfield 37:58
fact that matter is money is deeply embedded in our behaviors. Yep, deeply, deeply embedded. So I have to be cognizant of that and educated in that. And most of what you see on the bookshelf behind me, is stuff about financial behavior and behavioral finance. Right? It’s easy, the behavioral stuff, really hard biases really hard.

Hannah Mitrea 38:23
Is there a book on finances, you’d really recommend to number one,

Mark Newfield 38:27
I would tell you to read two books, geometry of wealth, and the psychology of money. One is by Brian Portnoy. The other one is Morgan Housel, read those two. And then we can have a real conversation about your planning. We send the psychology of money and the geometry of wealth to all of our new clients. As part of your welcome package.

Hannah Mitrea 38:52
I take a look at them for sure. But I love having this conversation with you mark. And so who is that person that should be reaching out to you? And kind of like that person that should be reaching out to your firm? And how will they reach out to you?

Mark Newfield 39:06
What would say to you if you find this conversation attractive, you know, then you should give us a ring. I’m not one of those people that says you got to make $500,000 a year I won’t talk to you or you got to have a million dollars. We won’t talk to you. I mean I’m in the business of helping people. So if you find the conversation that attractive and you want to have this kind of relationship you should give us a holler I mean our website is journeysw.com We have I think five or six and I don’t know whether location matters to you or not, but if it does, there are several advisor teams across the country that you can find that way if you want to find me. I’m at mnewfield@journey sw.com Or you can call the office at 8045259700 I think it is or you can hit me on Twitter, which is @MJNewfield or you can find me on LinkedIn at Mark Newfield or you can find me on substack at marknewfield.substack.com Okay, and we have a YouTube channel that is @MJNewfield, but it’s actually for journey. It just has my name on it. I mean any of all of those places, and I publish on YouTube, pretty much weekly, I try and do every week, sometimes life gets in the way. And I try and publish on substack every week as well. But again, sometimes life gets in the way.

Hannah Mitrea 40:20
Awesome. Well, if anyone that’s listening to this wants to reach out to mark, we’ll make sure to have all those places listed in the show notes as well. And thank you, Mark, so much for joining us today.

Mark Newfield 40:30
I hope this was useful and that you enjoyed it. I

Darion Robinson 40:32
did. Definitely more than useful. Thanks. I’m

Mark Newfield 40:35
glad to hear that you never know. Um, we all like to think that our work is fabulous, but you know, only others can tell you whether your work is truly fabulous or not. Precisely, definitely

Hannah Mitrea 40:46
this effects. Thank you for joining us. This week on the virtual US financial advisor podcast. Subscribe to the show on Apple podcasts, Spotify, Stitcher, or via RSS, so you’ll never miss an episode. We’d love rating on iTunes, or better yet telephone about the show, which will help us grow as well. If you want to learn from any of our financial advisers, head over to our website virtualusfinancialadvisor.com To learn more about each financial advisor and connect with them personally. Be sure to tune in next week to get more advice from the expert financial advisors. See you in the next episode.

Transcribed by https://otter.ai