602 | FI 201 Beyond FI Basics: Asset Allocation & Market Psychology Mastery

25:27They go up and to the right. It's not a hard concept to understand. And sometimes it's hard to believe, especially when you're staring at the teeth of a market decline. But again, a lot of ours are just don't do anything. You don't have to double down. You don't have to do anything. Just don't do anything. We talked about, I think, I don't know if it was Vanguard, and I'm pretty sure it's been on the show. But when there's a study of who was the most successful over a 20-year investing period, it's dead people. They don't tinker with their portfolios. they just let them grow. So, you know, stand there and do nothing, I think is the best investing lesson.

26:08If you're invested, just don't do anything and you're going to be rewarded. You know, with this 201 type content, we introduced some big terms, time horizon, asset allocation, risk tolerance, probably the next thing after you've done these broad definitions and you've started to think about charts, you're probably starting to want to get more focused. Now, this is where financial independence community, because it's growing so much, it's becoming international. And we kind of got a fork in the road here. I love that. And when you're doing base, but up to this point, everything that we've done by 101 to now has been universal to every country.

26:46So at this particular point, local admins in their country are going to be able to kind of front run this. It will translate, but your particular tax structure and your particular tax benefit style accounts, Canada, Australia, UK, et cetera, are going to steer some of the opportunities. And this is where we're gonna kind of diverge and go in different ways. But inside the United States, this is the great opportunity for us to really spend a little bit of time talking about the difference between a provider and an investment type account. And we could say it's taxable investments or you could say it's retirement investments or you could say it's whatever.

27:22But it's important for us to think not just about the asset allocation, but where are we investing and what is the tax treatment on that account? Because in terms of a comprehensive investing strategy, it's not just the fees and it's not just the type of account that it's in and what is it invested in. The tax structure provides significant opportunities for us regardless of how it's actually structured. There's various options and we can use them in various ways. So Alan, I'm sure. Did you go into this with any level of detail? Probably too much, but no, we talked about location, asset location, and then different accounts within those locations.

28:03So we looked at as something taxable. I mean, we call that our taxable accounts. It's a dumb name, but that's what everybody knows it by. It's just your brokerage account. That's where your leftover money goes. Your tax deferred accounts. So you're looking at your 401ks, 403bs, anything that allows you to avoid paying taxes initially on your contributions, but you may have to pay taxes on it later. We talked about tax-free accounts or some people call them post-tax accounts. Those are your Roth accounts, your HSA accounts, things like that. We added an extra one a lot of people don't talk about in other slash blended.

28:39My own example is our grandkids' 529 plans. They could be tax-free, they could not be tax-free. You make the joke in the middle of a presentation that says, well, if everything hits the fan, guess what? Grandkids aren't going to college because they're mine. So we kind of look at it in that aspect to say, where are you putting your dollars and how does that benefit you in the long run? And there's a number of, especially with Cody and Sean's book that really talk about asset location and the taxable impact of all of those. Cody and Sean's book is tax planning to and through early retirement. It has been an absolute game changer for the community.

29:20So yeah, I'm glad you mentioned that one, Alan. I think what Cody and Sean talk about, which is it's, it's really people should embrace this and think about it more and more is it's not what's my tax this year. It is what is going to be my tax burden over my lifetime. And you want to manage it over your life. And that's the reframe. That's the rethink. And that's what rewards financial independence, you know, kind of thinkers, people that have been in this community is moving in that direction. And so with this, you know, kind of 201 approach, I think we're moving through the stages of five. We're dealing with optimization on the path to independence.

29:57let's just say that the community starts to have an appreciation for all right i understand i understand why risk tolerance matters i understand kind of the basics between asset allocation stocks bonds etc uh i understand time horizon and where i am on this journey and why if i my time horizon is shorter to when i'm going to need the money then that means my risk tolerance is also you know not it's going to be lower it's not going to be as high because it very much matters what's going to happen in the short term. These three things are coming into place. But then now, the reason I think these additional conversations is you have this additional layer of tax treatment.

30:32It's US specific in this particular case, but other countries have their own various versions. With what you just said, you dropped a couple of them there and you mentioned taxable versus pre-tax versus post-tax. One pattern that emerges, at least here in the United States, probably does in other countries, is that disproportionately, we can get a lot of benefit by lowering our marginal tax rate now, or maybe not lowering it, but rather reducing the amount of income that's going to hit those higher marginal tax rate by loading up pre-tax accounts. So we're going to invest, but we're going to invest inside of our 401ks, or if you have access to it, your 457s.

31:12And some of these accounts have really interesting quirks and cool things about them, like the 457B in particular is one that our community continues to be blown away by. And I probably would write it off, except that for whatever reason, over and over again, it comes up as being one of the most high impact things that people mentioned. I had no idea I've had access to this the whole time, and I didn't really understand the power of it. The reason that we start to get interested in tax accounts and tax treatments is your money's fungible. So you want to access your money in the way that gives you the best tax benefits, but through the lens of your tax burden over your whole life.

31:54And now we've just determined that's a multifactorial equation. So you want to have a lot of moving parts kind of nailed down. That way you're limiting the variables so you can figure out for me, what's my situation. But typically if we can reduce the amount of income that's going in at those higher marginal tax rate. Brad, you mentioned this a lot and I think it's picking up weight. There's a high likelihood that when you retire and you have left your income, your taxable income, your tax income rate will be far less than it is than while you're working. And that's not even necessarily because you're living on less, but because the tax treatment on the assets that you're living off of are treated at a more favorable rate, capital gains versus income tax rate.

32:37Yeah. Well, like you said, it multifactorial also. And yeah, I'll get into that in a second, but just to give as many specifics on this episode as we can, as opposed to just generalities, like you said, 457B, this is a really important one. After separating from your employer, you can withdraw money from a 457B without the 10 % early withdrawal penalty. So for people who have options of, hey, I'm a public service employee, I have a 457B and a 403B. Okay. 457 is really pretty phenomenal. It has that extra little bonus. That's not something to scoff at. That's massive. Now, a lot of people have access to both of those.

33:14Okay. Well, there's some ordering rules sometimes. In this case, 457B, you can pull that out without the penalty. That's fantastic. And this is what's so neat about the FI community is there's always some additional little thing that we've figured out. And I think, and we've talked for years here at Choose a Fi, that traditional personal finance, and even frankly, in some corners, some significant corners of the Fi world, people talk about maxing Roth IRAs and 401ks. Whereas we believe very strongly, and the aforementioned Sean Mullaney and Cody Garrett do as well in their book, that lifetime burden of taxes on this money.

33:57Okay. I think when you put money into a tax deferred account, like a traditional IRA, traditional 401k, so you get the tax deduction in the current year. This is a control what you can control type scenario. You are locking that in at your current top marginal rate, which this is during your working years. presumably that's going to be much more significant. But because of the tenants of five, because of when you're at five, most likely your expenses are fairly under control. You might even have a paid off car. You might have a paid off house. Your life might only cost, and I'm not saying this is guaranteed or even necessary, but your life might cost $40 ,000,$50 ,000.

34:42Well, because of the tax treatment in the U S because of the new dramatically increase standard deductions. You have a standard deduction for a couple of over$30 ,000 now. That means right off the top. Let's say your life costs$40 ,000. All right. Not unreasonable if your house and car paid off. If you pull all that money out of your traditional accounts, now you have said to the government, this is entirely taxable. All$40 ,000 of that is taxable. All right. Well, all well and good. You go to your 1040, your tax return, and you say, hey, government tax me on this$40 ,000. But they say there is a standard deduction for a married filing joint.

35:24I think it's like$32 ,000 this year. Don't quote me, but it's somewhere in that vicinity. 32 ,000 comes right off the top. So all you have left is$8 ,000. There's a reasonable likelihood you might have other deductions, but even if that's it, that's all going to be taxed at most at the 10 % marginal rate. So your tax on that amount, is literally$800 from the federal. That's on$40 ,000 that you pulled out. That's a 2 % effective tax rate. That is why I think for most people in the FI community, putting money into tax deferred accounts is going to be dramatically more beneficial than putting into Roth.

36:07Now that doesn't mean there's not a place for Roth. And Alan, I'm curious, how did you think about this when you were presenting to an entire audience of 60 Do people who are all coming from different places have different current incomes, et cetera? Yeah, I think it really, it boiled down to, and in my mind, and this is why we're going to do taxes as our next 201, people don't understand marginal versus effective. So we're going to really boil it down what that truly means. And some people need to see it on the board. Some people need to see it on a presentation. We'll get into that and explain, if you're putting $23 ,000 this year into your 401k, you're at a 24 % marginal tax rate.

36:53If you pull that same 24 out after you retired with no other income, you're not going to pay taxes on that. Zero. We want to really emphasize that. In the presentation, I've always used a third, a third, a third as a target. To me, that gives you a tremendous amount of flexibility. If you early retire, you've got Roth assets, you've got pre-tax assets, and you've got a taxable brokerage account you can draw from. Let me speak to that for just a second, Alex. I think that actually gets to something that I really wanted to go to, which was people were like, all right, I know this is the fire community, the retire early community, but if I just do what Brad just said, I can't have the money without a penalty before 59 and a half.

37:36While that is maybe technically true, practically for individuals in the FI community, it's almost irrelevant. So it's not true. With the FI community, you become aware of all the various strategies that you can use to access that money. Brad mentioned one in passing with the 457. If you have a bunch of money in the 457, when you retire early, that's literally the criteria to be able to access the money without penalty. So done, which is why people get very excited about that. But then in addition to that, we have the Roth conversion ladder. We have the 72T. You have the rule of 55. These opportunities abound.

38:10The one that I didn't put a whole lot of emphasis on, but it directly ties to what you're saying, is the Roth conversion ladder. And in this particular case, it helps to have some money to live on for around a five-year window. And so if you have money that's outside of pre-tax, whether it's in taxable or whether it's inside of your Roth IRA. But this is very nuanced, nitty gritty stuff. And so the point I think in a 201 is not necessarily that in this particular session, the person is going to be a master at 72T rule of 55 Roth conversion, but they do need to know that it exists and they should be able to walk away feeling very confident that they don't need to just be worried about, oh, I'm going to pay penalty.

38:51I can't touch the money until it's 59 and a half. And a lot of what we talked about, and that's maybe optimal. Again, no, I'm not there. I don't expect any to be at this magical third or third or third. We're going to talk a lot about when it comes to taxes. If your current marginal tax rate is 12%, I'd probably load up on Roth assets if you could. Get your match. Maybe that's only in the 401k. They don't have a Roth available. Get your match. And then maybe you're investing in Roth IRAs outside of work. So it's really going to boil down to where are you in your own personal journey? This is not boilerplate stuff.

39:32You can't do everything that we list on this document because everybody's got their own personal situation to deal with. But we're going to try to emphasize, as take advantage of what the tax code gives you. And if the tax code says, yeah, you should be contributing to Roth assets, by all means, go for it. You're probably going to pay 12 % later. Might as well get it into a Roth account now and pay the 12 % now or 10%, depending on where you're at. Again, I think the community spends a lot of time on Roth conversions, and I don't know that that's the direction we should be in right now. I think talking about taxes, marginal tax rates, 401ks, that's the basics of all of this is try to minimize lifetime taxes.

40:20You know, as we're going through this kind of 201, I realized some of it, whether there's slides on the 201 presentation, and by the way, Financial Independence 101, Financial Independence 201, all of those are available for local group admins and, you know, by extension for their community, but local group admins have access to all the presentations. We're continuing to crowdsource, iterate them, their living documents. If you would like to be an admin, either reach out to your current existing admin team, or if you're in an area that doesn't have one, just raise your hand. I mean, we'd love to see this stuff be able to be used.

40:52What we're trying to do here is we're just establishing a cadence, a framework that all of us can kind of iterate and build. If we were to remake this episode a year from now, maybe a little bit more of this is fine-tuned, but what's become apparent over the last six months as Brad and I have been sitting down and doing these episodes together is that the community, it says it's, it's overdue for standardization. It's overdue for kind of a baseline of best practices that we can take into our communities. And yeah, I mean, we'll fine tune it. We'll personalize it. You know, maybe Alan just mentioned, you know, maybe, Hey, I tell you, just throw it through off.

41:23And Brad's like, I'm a purist on this, you know, until, until, until I have to, until the tax rate's guaranteed, like I'm just going to go great. The FI community is not a monolithic group of people that all agree with each other on everything, which is amazing. You get to see in different directions. And a lot of times for unique individuals and individual circumstances, the advice is correct. But that leads us back to that old statement, personal finance is personal. Let's benefit from the diversity of opinion. Now, Alan, I have a feeling, I just have a feeling at some point it's going to come up, Alan, should I be doing individual stocks?

41:56Like what are your, you know, like, is there, Or is that a big part of this? What should I do? Or I have individual stocks and some of them should do well. Or how does that fit into this conversation about asset allocation, et cetera? What sort of level of education do you bring into this? Mine is I personally have a few individual stocks. I like to tinker in some instances, but it's a really small portion of my portfolio. I found a study through Arizona State that was talking about what made up the wealth in the stock market in the past 100 years. And it turns out it's about 4 % of the stocks over that period of time contributed to 100 % of the wealth.

42:35So you had 29 ,000 stocks and a little over 1 ,000 of them contributed all of the wealth. That's not saying... So you had several of them go bankrupt and you had several of them make some money. But if you line them all up against their returns, you take out 28 ,000 stocks, that's zero. and then the rest of them made everything. You can do it. Don't count on retiring early or retiring if you do it. You hate to say that. And I know Brian Feraldi would say, anybody can invest in individual stocks and you can. And that may be your portfolio, but even, I think even he has the majority of his assets in index funds and things like that.

43:20So So by all means, if you're interested, invest in individual stocks. Enjoy the process. Learn how a company actually returns money to investors, whether that's through growth or dividends. But do not make it the emphasis of your portfolio. Yeah, and I think the upshot there is it's just incredibly improbable that you are going to be the one that picks those couple of percent. In that case, it's what about 3%, right? Over the last hundred years. it's possible. Obviously, it's possible. I always look at this investing as what is my highest likelihood of success. When you buy a broad-based fund, ETF or index fund, you're buying this self-cleansing mechanism where the winners keep rising, the losers, of which there are many, just kind of drop out, but you get all those gains.

44:14You're not just getting lucky picking a couple of companies, even if you think you know what you're doing. It's so improbable. Warren Buffett had this famous 10-year bet with this hedge fund person who was able to basically handpick their fund of funds. Basically, Buffett just took a net of fees, which fees are critical, as we talked about in the 101 episode. Buffett took the market. Basically, I think he took the S &P 500 net of fees versus this handpicked, They know the insider information, head fund. You get to pick the exact funds you want. And Buffett trounced them, trounced them. Just the S &P 500 trounced them.

44:54And it was this million-dollar bet that went to charity. It was fantastic. But so is it possible to pick individual stocks? Yes, it is. But what is your highest likelihood over 40-plus years, which is your investing lifetime? I think it's trying to just match the market. I think that is your, by far your highest likelihood of success. This is so important. I think this is just absolutely mission critical. So, you know, inside of the, uh, the Dave Ramsey community, there's a bunch of individuals that would teach a financial peace university and, and they would talk about the evils of credit cards, et cetera.

45:31And then separately, they would just say, well, of course I use a credit card because you'd be a crazy person to not use a credit card. Cause that's how like, you know, and I use it for travel rewards, et cetera. But then inside that room, they're like, and to some degree, maybe rightfully so, because there's a lot of people that are in credit card debt up into the eyeballs. In the same way, also, FI community, you have a bunch of people that publicly advocate for index funds, but then privately or maybe not so privately, they also invest in some individual stocks. In this particular case, you're never going to talk the person out of investing in their individual stocks.

46:05But they will be the first to tell you or to hedge their bets that the vast majority of their assets are in broad-based index funds. My point with all of that is twofold. One, all of us think at some level, we think, all right, we can beat the market. Like, all you got to do is just pick a couple. At some level, you're like, I think I could do this. but there's two things I wanted to come back with. One, you might. Two, if you're really making money in individual stocks, you're doing it before, long before anybody truly appreciates the value. So you're buying and holding for a long time or two, and this is what Brian talks about.

46:42When the market has a short-term fear about something, you see a long-term opportunity, meaning you are buying when it goes down. But unlike the broad market, which might go down at some level, stocks can go down to a staggering individual degree. So when everybody is seeing like, you know, blood in the streets on this stock, you're like, Ooh, that's an opportunity. Here's the problem. All of us with confidence can say, if the market goes down 30 or 40 or 50%, all of history, all of the stock market history tells you that if you're invested in the broad base index, that is an actual opportunity.

47:17I had the chance this past week to watch the BlackBerry documentary on Netflix. Probably worth a watch for individuals. Does anybody remember BlackBerry? I say that. I know all of you do. And just for anybody that gets that, do you realize that it was in everybody's thumbs? Everybody was excited about it. It was a game changer. And then Steve Jobs walks onto a stage and shows how the keyboard is the screen. Did you see a buying opportunity there? When that BlackBerry started going down, did you see a buying opportunity? BlackBerry went from a billion dollar company, $15 billion company to basically insolvent and bankrupt within a year and a half.

47:56Even if you got in on the BlackBerry early on, you have no guarantee that your smart bet at that time will still be here five years from now, right? Tesla makes an amazing car. Somebody comes out and it just undercuts it in some way. Maybe it is. Maybe you got in early and Tesla is the runaway, but there's no guarantee on this. And the problem is you only get one life. So Brad, to your point about thinking in bets, you cannot go back. And yes, you may look like a genius that figured out value where no one else was looking at it, but if you missed it, you can't undo. You can't get that time horizon back.

48:34And so if you're thinking in bets, even if you feel like with a small percentage of your income, you want to take a stab at seeing if you can be the anomaly, you can be the stand out, you should recognize that the odds are very stacked against you over long periods of time. And if it matters in terms of your net worth, you should try to make sure that thinking in bets, you have multiple ways to get you across that finish line. It's amazing when someone can beat the market, but the reality is most people bordering on everyone don't over periods of time. And when you're in one stock, even if it's a slam dunk best thing on the market, like a BlackBerry in the world that moves fast next year, something can undercut it.

49:13The point of encouragement is you don't need to pick the BlackBerrys. You don't need to pick the apples. You don't need to differentiate between the Netflix versus the Blockbuster. You can just keep up with the market and you can become fabulously wealthy over time by just keeping up with a dead person and doing nothing. That's kind of the heart of this. And if you can get that across in a 201, if you can nail those practically, someone is going to have many multiples of what they would have otherwise and have a confidence in their plan that they wouldn't have had otherwise. So as I kind of think through what you did, it's not to tell you how to change your presentation or otherwise, but I think so much of it here is fabulous.

49:48And I think really that's what we want to get across. We did not have time to get into all of this structure during that first 101 session. We needed to bring it in here, not conflate it with expense audits, not conflate it with everything else, and just have some time to sift through these and apply them to actual scenarios and actual individual's life. And I think if any version of this was accomplished in the session, I think people went home, you know, kind of thrilled and having something to talk about. Alan, I'll just give this back to you. It sounds like what you're saying is you think the 201 needs to be further split and maybe just time-wise you'd like to put, you know, if you were to do this again, maybe you'd put more focus on, you know, the asset allocation, the time horizon, the charts, that sort of thing.

50:31And then you would continue to extract out a whole nother session about the tax treatments, marginal, effective, et cetera? Yeah. And our next presentation is going to be on taxes and probably not just around the investing piece of it. We'll talk about how do taxes impact your life? Maybe talk a little bit about here's a 1040, how do you fill the dang thing out? Again, not a tax expert by any stretch of the imagination, but I've been paying taxes and doing my own taxes for 30 plus years. I've paid a lot of taxes, so at least I have that experience. And it's just sharing some of the crowdsource knowledge on how to take advantage of the tax code.

51:15I know it comes up a lot. We talk about some of us with more taxable assets, and especially if they're in a government security, you don't have to pay state taxes on those for the most part, on the interest that is generated by those. that's not clear on any of your 1099 information for them that I've noticed anyway. So getting people to see that, helping people realize that, you know, if I earned a thousand dollars from a treasury bill last year, I'm not going to pay state tax on that. You know, that'll pay for dinner out if I don't have to pay 5 % on that. These are just the little things like that, that people don't realize because sometimes they just want to be done.

51:56I filed it. I'm done. Or somebody did it for me. Man, I encourage everybody to at least take a shot at doing your own taxes because it really opens your eyes to what could be available out there. But that's going to be our next presentation. I know we say taxes is a five superpower. Let's demonstrate that to some folks, but in a presentation format that allows them to think about it, ask questions, bring their own personal tax scenarios to the group. I'll definitely share taxes, my taxes and how we've done it over the years. And then hopefully everybody learns something. Now, Alan, you are retired, right?

52:37I am. If you were using yourself as a case study, it would be a pretty representative case study for living in drawdown with early retirement and having assets in various baskets. and using those and how you actually construct your own, you know, you construct your income. You get to choose your tax treatment and your income. Is that right? That is correct. That's awesome, man. And before the most recent legislation, I was going to do a lot of Roth conversions, but we're also on the ACA. And now that the cliff has materialized again, I have a spreadsheet that shows every dollar that comes in that's taxable.

53:15and I'm going to make sure that I don't lose my subsidy by tracking it religiously and making sure I don't hit that cliff and go a dollar over it. You just nailed it. You just nailed why people need to increase who they are exposed to because a lot of people are just letting their tax treatment happen as opposed to realizing what you're realizing and you can control it. I think one thing you're talking about here, we didn't hit it. I was actually thinking about talking with it about Brad just off, you know, after we got off, but I think it's perfect here is people mentioned stocks, but then now the last part of this is dividends.

53:53I tell you, I think Brad has gotten more flack from people over the years about dividends than any other single topic. And Brady, you don't need to defend yourself on this one. I know you're itching at the bit to go, but I'll just kind of tee you up for it. The thing about dividends, regardless, and they are polarizing, but that is that there's nothing magical about them. I don't mean to steal your thunder. There's nothing magical. All that the company is saying is, hey, instead of using this to grow our business, which you could then potentially sell for more value later, we're just going to push it out as income.

54:25Now, regardless of whether or not that works out for the company long-term or otherwise, the one thing that's absolute indisputable is that when a company pushes return on you as income, you lose the ability to decide the tax treatment. You lose the ability to decide the timing and you lose the ability to decide how it's actually going to be treated. In light of what Alan just said, having that fine-tuned control is incredibly important. And the FI community likes to preserve the control and then flex it when they need to keep as many options available. So in terms of, you know, maybe you're like, well, where's dividends and all that was my dividend portfolio.

55:01Well, what you've decided is you that you, even though theoretically in a perfect world, you could have been taking advantage of capital gains, capital gains, harvesting, all these other things you've decided, I'm just going to take my investments and recreate the same tax treatment I had is when I was working. Oh, okay. I mean, that's fine if that's what you want to do, but now you don't get to have the options over here where you decide the tax treatment around, you know, capital gains. You've just recreated your job inside of your investments. So options matter, right? And so without getting into anything else on dividends, you can't even argue that.

55:33It's not subjective. You're making an objective choice to force income on yourself through what could have potentially been your most flexible tax treatment years. I 100 % agree with that because I would rather, like I said, given the cliff, given the ACA subsidies and the value of those these days, I just want to be able to understand where my next dollar of income is going to come from? And if there's too much, how do I figure out how to move that or change that in some manner? If a company all of a sudden issues a special dividend and says, now you get$10 a share on December 29th, I'm going to have a problem.

56:13And that's massive, right? Nobody wants a forced taxable event, especially not in the community. We want to be able to control this. You mentioned, Alan, your ideal would be to have taxable accounts, pre-tax, and Roth accounts, you want to have very granular control over this. Another thing you mentioned, hey, I might not learn something from every episode, but we might have Sean Mullaney and Cody Garrett on to talk about, hey, the one big, beautiful bill or whatever nonsense it was called. This changed everything for these subsidies. That in and of itself is critical. And that's what we do so well in the fight community.

56:51And that's why these are living documents. Not only this podcast, but these presentations as well. They will always be living documents because things change. And what we do is we stay ahead of these changes. Okay. It was all well and good when there wasn't this subsidy cliff for the ACA, but it is now. And that's fine. You can cry about it all you want, or you can understand the rules and you can, in your case, very specifically figure out what exactly my income can be. That's pretty fun. And also there's still a way, again, you know what your expenses are in your life. You know what you have to pull out of all different accounts.

57:30So can I do tax gain harvesting on my taxable accounts? Can I pull some out of my Roth? Can I pull some out of my traditional accounts, which are going to be taxable events. So as Sean Mulaney has discussed repeatedly, there are different, sometimes you want to be over a certain threshold and then under this subsidy cliff. So having a little bit of flexibility, that's why this is so important, but really at its essence, it's knowing the rules and understanding things can change, but you have to stay up to date on these things. And it's really critical. And Alan, you've seen it in your own life just over these last couple of years.

58:09One of the questions came back after we shared everything. It's like, well, how do you plan on changing your cash buckets, things like that? It's like, I said, I don't have a plan for tomorrow. I don't know what's going to happen in the next six months. You know, next two years, legislation is going to change. I have no doubt in my mind, something's going to change. I know in 30 years, I'm fine. Hopefully I live 40 more years. We'll never know. But I know tomorrow something's going to change and I have the flexibility to react to it. And that's what I want to share and hopefully teach people that you don't have to follow this specific plan the rest of your life because you need to be able to react to it and be as flexible as possible to what changes are going to come.

58:58Not might come, they will come. This was so much fun and it was comprehensive. So huge thanks to Alan and Kristen. for just making themselves available and having this conversation with us. As you can probably tell, Kristen had to head out just a little bit early, but we actually got her to stay longer than she was planning just because the information was really so compelling and we didn't want to truncate it or cut it short for you. If you want to get in touch with Kristen now, they are active inside. I'm excited to say it. They're very active inside the ChooseFI community app. They'll have links there.

59:28You can get in touch with them actually inside the community if you want to do that. I'm sure they would love to share, you know, any tips and resources that they've come up with. They're very committed to this idea of seeing community and seeing local groups flourish and be able to share this information. As you can tell with Alan, just super generous, nice guy. Would really love to be able to help you out any way you can. So just go to the Chooseify app and I'll have links in the show notes where you can connect with them and their various profiles there. For us, we're going to keep this going.

59:52This isn't the end of this conversation. As you could tell, Brad and I are really committed to this idea of standardizing this. And it's not that we've got everything nailed down yet, but with Kristen's help, Alan's help, We're going to be talking with all the local admins coming up here very shortly. And then I would anticipate we're going to have a few more of these conversations, but we're really going to try to thread this needle of extracting the actionable bits for you. But at the same time, using this to encourage the conversations in the local groups, every single little soundbite that you heard here could justify its own dedicated session to go into these.

1:00:24Alan's teeing himself up for a dedicated session on marginal and effective. And I can tell you, as I think about the spacing, I'm also thinking, yeah, you're going to have to spend a solid chunk of time showing how marginal and effective can be woven in together to help you bring together these strategies. With anything that we want to do, we want to make sure that it's actionable. And that's the thread between the local groups doing these activities and events and the Chooseify community app, hopefully starting to incrementally provide exercises and activities that can accompany everything that's happening there.

1:00:55So if you're not sure what is my next step, well, first of all, if you're in the St. Louis, are you not a part of the St. Louis group yet, you need to get in there and join them. You'll regret not doing that. And then more so, all of us, we need to lean in to this idea of community. We need to lean in to this app, this community app, and to these local groups and make sure that we are helping the admins out any way that we can. That's through participation. That's through doing various activities and volunteering for a case study. And guess what? It's the type of thing where by helping them, you're helping yourself.

1:01:25So as we like to say, and I like to say a lot, The fire is spreading, my friends. We'll see you next time as we continue to go down the road less traveled.