I enjoyed catching up with fellow advisor Josh St. Laurent on his podcast, Wealth in Yourself. Together, we discussed the opportunities and challenges for those approaching and entering retirement, what it means to align your money with what you care about, and more. You can listen in or read the transcript below:
Josh: Welcome to the Wealth in Yourself podcast, where we help people to design their ideal life and take control of their time and money. I’m your host, Josh St. Laurent. Today, we’re joined by Brenna Baucum, who owns and operates Collective Wealth Planning, a values-centered financial planning and wealth management practice in Salem, Oregon. She specializes in tax-efficient planning for public employees, professors, and retirees. Brenna’s work focuses on helping her client families align how they spend, save, and invest with what they care about. Brenna, welcome glad you’re here.
Brenna: Hi, thanks Josh, it’s so nice to see you.
Josh: I’ve been looking forward to this. I want to kick us off with, for anyone listening who isn’t familiar with you and your work, what do you want them to know about what you do.
Oregon PERS Niche
Brenna: This will be year ten that I’ve been in this industry; hard to believe. I started off working for an independent firm here in Salem and then spent a couple of years training financial advisors on the human side of money and financial psychology; I believe that is where you and I met each other. My practice, as you mentioned, serves public employees and retirees, and professors.
Our pension system here in Oregon is one of the most complex in the United States; the second most complex, actually, so that’s why I chose this as my niche. There are lots of people who need help navigating that, and what I love about working with folks through this transitional phase of work to retirement is that there are so many challenges and so many opportunities that come with planning that people don’t often have the time to think about when they’re working away, so that really helps set this up as one of the most rewarding chapters in life. It’s really exciting.
Josh: Absolutely, and I’m always impressed by the niche that you went into because the Oregon state plan is extremely complex. I have about this much experience with it and, wow they don’t make it easy. So how did you land there?
Brenna: I’m in Salem, the capital of Oregon, so there are a lot of state employees here. Most states have a pension plan for nurses, one for police, one for firefighters, teachers all have a different piece; here in Oregon, it’s one big pot, and so it looks a little bit like tax code, where it’s this patchwork where they have one system that they’ve continued to add various pieces on to try to make it work.
In my former experience in practice, I had a lot of PERS employees coming to me saying, “What does this mean? All these acronyms? IAP, OSGP – I don’t know what to do with these, and I don’t know what role they actually play when I’m trying to make sense of if and when I can retire.” So that, to me, was a really clear indicator; and then, it’s just like anything when you can focus in on one area, then you are able to answer a lot more of those questions effectively. And I love working with this demographic. I like people our age, too, but I really like working with the planning challenges and opportunities when people are facing that transition; it’s really exciting and fun.
Josh: Yeah, one of the biggest transitions they’ll probably ever have in their financial lives. I’m curious about, like you mentioned in the beginning, you were an advisor, then you went to train advisors on the human side of money, and now you’re back with your own firm; how did that time training advisors and kind of living breathing the human side of money how did that change you as an advisor and how you approach the conversations that you have?
Brenna: Great question. I was so fortunate to have that time to practice and hone that skill with the supportive environment we were in. I was able to build my practice utilizing this core outline of “life planning” tools, is what we call them in financial life planning, in this arena, and it allowed me to have both the qualitative and a quantitative element to each step of the financial planning process that I didn’t have before. I think I had the brass tacks of what it took to be a relational advisor with people, have a good rapport, and get to understand what they cared about, but it wasn’t until I had some more training and a framework to be able to say, “What are we really talking about here? How do we really get you in alignment?” And, alignment not only with your financial resources but also your time and your energy; how can we bring all of these things together so that, yes, finances are the cornerstone of what we are working on together, but we can help to move the needle on all of these other pieces too and really increase life satisfaction which is the ideal when working with client families; I know you feel the same way.
Josh: Oh yeah, absolutely. I had a major career shift after ten years in, I’ll call it corporate finance, and the life planning structure and outline as you describe it was so eye-opening for me, and I refuse to do it any other way now. That has been so impactful for me. A lot of it was your teachings and Money Quotient and that process. I know that a lot of the work you do is around attachment between money and how we earn it. Can you talk to that a little bit?
The Connection Between Money and How We Earn It
Brenna: I think that relationship is so interesting.
When I get to work with people who are five to ten years from retirement, it seems like they’re grappling with one of two things: either this extraordinary transition of losing a part of their identity when they retire, or the reality of dipping into the pool of money that so preciously have earned and saved for as income replacement. Most often, it’s both of those things; they are such a huge shift routines and our identities.
You said this earlier, that retirement is one of the biggest transitions we can face. If we zoom out and think a little bit about the transitions we go through in life, identity shifts: adolescence, and we’re growing up; maybe educational journeys; our career path; if we decide to be in partnership or be married; if we decide to have children; midlife, retirement, and aging. My argument is that out of all of those changes, there are no two that change and impact our identity as quickly as becoming a parent or retiring. Even though the lead-up takes time for those things, one day, my daughter was in my stomach, and the next day, she was out, and my identity totally shifted. I think it’s the same with retirement. One day, you go to work, and the next day, you don’t, and that is true even if you are gliding out.
It is very difficult to procrastinate on having a baby, but you can procrastinate – for a long time- thinking about or planning for retirement. It always seems like something that’s on the horizon, five to ten years away. It’s complex, so people tend to put it off. I think it’s really interesting to think about this big shift that so often people are saying, “I’m going to think about that later; I’m going to talk about it later.” It’s wild to me; I really find it fascinating.
Josh: It is fascinating, and the two words that jump out to me are 1) identity because I think every financial planner has experienced this sort of identity crisis almost where it’s like, “Well, I have been an educator for 30 years and next week, I won’t be anymore and what does that look like?” And 2) the procrastination is absolutely real. I think most planners have experienced that, too, where it’s like, “I don’t know what I’m retiring to.” Can you talk to how you help people with that shift of what is the new identity become, what are you retiring to, what is this ideal retirement? And how do you make it exciting and something that they can look forward to?
Embracing the Retirement Chapter
Brenna: There are a couple of ways to do it. We talk about the qualitative and the quantitative; there’s both of these elements to talk through. We can talk about the financial transitions in a minute, but in terms of the qualitative side of your life, there’s so much value that can come from reflecting on what it is that you value, which has likely shifted quite a bit over a career. Most often, people are spending their time working away and having values, of course, and things that are priorities, but those shift and transition. So retirement offers up this really great opportunity to step back and say, “What do I care about now? And how do I want to empower my resources to support that?” Whether it’s family, your church, whatever it is. I think that we don’t feel like we have very much time when we’re working to have that time of reflection.
It’s one of the things that I love, and I know you do too, about our roles is to be able to walk alongside people and say, “Hey, let’s slow this process down a bit and not just jump from a to b.”
Let’s take some time to think through, talk through mental dress rehearsals. Let’s try this on. What is it going to be like? “Well, my neighbor has a boat, and he’s retired. Should I get a boat? Am I supposed to get a boat?” And instead of going out and buying a boat, maybe you rent a boat or maybe you go to ride with him and see if you like it. It’s those kind of bite-sized ways to ease into retirement and figure out what it is that’s your unique measuring stick as opposed to what the Joneses are doing.
Josh: I think it’s such an important point, and when I think of my timeline as an advisor, and I think back to my early days, I had really bought into this visual that we all see on the Super Bowl commercials for the big finance firms: the old couples walking on the beach hand in hand, or in the rocking chair reading the newspaper, but so very few people, that I talk to anyway, that’s not their reality. A lot of people want to keep working, they want to have some sort of purpose; there are so many major changes; maybe they want to relocate to be closer to kids or grandkids. How do you incorporate all these life aspects? Because, to your point, I spent many years only focusing on the quantitative, and I was missing much of the big picture, and it really does a disservice to people. So, how do you incorporate some of that vision of their life and what is going to be ideal for them into the plan?
Designing a Unique-to-You Retirement Plan
Brenna: I think that self-reflection is step one of what do we care about, what are our priorities. And the second step is what to do with that. Analyzing, what do I do with this information? This reflection? Is there alignment, or is there something that needs to shift? Because I can do that. I have a choice of whether or not I want to keep doing this versus that. So, second is kind of this empowerment and saying, alright, let’s make some shifts. There are all sorts of ways to incorporate not only how the finances impact the financial plan but also your family and; what is your level of satisfaction today, client, with your leisure life, for example? And if they say, well, it’s a five out of ten. I ask, well, what does a ten look like? Then we start to talk through what a ten looks like, and sometimes that ten has financial tethers that we can help incorporate into the plan, and we can say, “Oh yeah, let’s earmark this amount of money for that,” and move the needle this way.
Other times it doesn’t, and either way, it’s useful for the client. Often times they will say, “Just talking about this is helpful,” because money is still so taboo that our client families don’t often have an outlet to have a discussion about some of these things; they don’t necessarily want to do with friends or family and many cases, so that means to have a space where you can come together and be real honest, saying, “I’m thinking about this, I’m thinking about that;” having a thought partner I think is really the role that we get to play that makes this job so rewarding and can make it so powerful for clients.
Josh: It’s so rewarding, and it’s funny that you bring up The Wheel of Life. I’ll be curious to get your perspective here. I’m always fascinated by the energy that comes along with going through the Wheel of Life. I get a lot of feedback of, “Wow, look how much we can move the needle and how very little money it takes,” because sometimes it’s not tethered to the money at all. Sometimes, it is and a nominal amount of money to make this thing happen. I think a lot of people have this perception that they have to be multimillionaires to have this amazing retirement, and for most people, it’s just really not the case. I’m just curious: do you find the same thing when taking people through exercises like that and when they sort of have this light bulb moment of “Oh wow, I already have the income. I just need to design this in a way that suits me?”
Brenna: Absolutely, and so often, the client families I work with tend to say, “Well, I don’t know if I should or can do that as much.”
Sometimes, it’s the way we were raised and the lessons we learned about money growing up that make us feel like we can’t or shouldn’t outsource some of the stuff that doesn’t bring us joy, even if the numbers work.
What I like about these conversations is that it opens the door to not only, “Yeah, you can pay someone $500 a month to do yard maintenance,” or whatever it is. The client probably logically knows that if that’s the case for their financial situation. But to have a conversation about, “Well and what would you do with that time? If you were not mowing your lawn and picking up all of the debris and that kind of thing?” Then they start to focus in on what they’re looking forward to, which makes that $500 expense feel like it’s empowering them to, again, bring their life into alignment as opposed to the drudgery. When we can get down to that, that’s where we’re actually getting our dollars to work for us, align and empower us.
Josh: It’s so true, and it’s hard to quantify. In conversations with clients, it’s very easy to say, “Well, we’re going to do this tax maneuver, we’re going to change this investment, and the fee saved is x, but when you get your life in alignment as you say, it’s hard to quantify that. It’s like, wow, I’ve opened up this many hours in my life, and now I’m spending time with the people that I want to spend time with, doing the activities I want to do. Is there a dollar savings there? Maybe not directly, but it’s hard to put a price on what that means to people that you living their authentic life.
Brenna: Yeah, it’s what makes it a little challenging for us to be able to describe all of the ways in which a CFP can help you move the needle in your financial life. It’s multifaceted and different for everybody.
Josh: Yeah, it is. I want to transition a little bit, and you actually touched upon it earlier about fast and slow identity shifts over our lifetime. Can you expand upon that because I think that’s really interesting, too.
The Three Anxieties of Retirement
Brenna: I think the shift to retirement; there’s all of these anxieties that come with it, in part because it is both fast and slow. I see three trends that tend to fall together within financial anxiety. It’s the mindset, the financial mindset, it’s a fear of running out of money, and it’s a loss of control or a fear of loss of control.
When we think about the mindset shift changes that someone transitioning to retirement needs to do, what they’ve done their entire life doesn’t work anymore, right? They have had their nose to the grindstone; they’ve been building and growing assets and saving for the future, and now the future is here. They’ve probably become comfortable seeing certain balances on an investment report or in a bank account, and maybe subconsciously, there’s this net worth and self-worth connection happening that they may not be aware of. There are all sorts of studies and science around behavioral biases and anchoring and what happens when we do that. So, the mindset needs to shift from saving to spending and managing wealth. That’s one of those anxieties. Another is the fear of running out of money.
It is natural for us to build our money in silos. We have a 401k over here, we have a taxable account over here, a savings account, a 529, all of these different things; that’s naturally and organically how our lives grow, and it’s very hard to feel any level of confidence, much less make a mindset shift around spending to managing, until you understand how all those pieces fit together.
Again, that’s a big piece of the work that we get to do with our client families every day: show how the puzzle comes together, so there are some solutions to it.
The loss of control feeling is arguably one of the biggest pieces that client families face in this transition because when we stop saving, we stop working, that means we have to shift to relying on our investment portfolios, social security, pension income, or whatever it is, and that can be a really difficult change for people who are empowered by the financial aspect of their work. Sometimes, it shows up with concerns about market volatility, or whether or not Social Security is going to be solvent, or a pension is still going to be around and it’s hard to entrust financial decisions to either market forces or a financial professional. We talked a little bit about some of the loss of social networks and the purpose and the structure today a job provides to somebody. All of this to say: have empathy for people facing this big transition. There’s a lot purse and and some things to mourn a little bit as as you make that shift, no matter how fast or slow.
Josh: I like that verbiage you use; it is mourning in a way. It’s a whole new chapter of life. I remember a presentation that you did, I had sort of this light bulb moment, and it shifted the way that I talk to clients. For ten years, I was trained to maximize, maximize, maximize, and I’ll use some financial planner jargon here, but we work sort of taught in terms of the accumulation phase and the distribution phase. For me, it was always to maximize everything at all costs, be really conservative in this distribution phase in retirement, and if they pass away with a million dollars, well, good, they didn’t run out of money. But, the reality is, if they didn’t want to leave that million dollars to someone, that’s a million dollars that were unused that could have been used to travel the world or live closer to grandkids, or have that beach house, or whatever it is that really would have been meaningful to them. That shifted my perspective that I sort of failed them as the advisor in that way when that money could have been better spent, and so, I’ve shifted the conversation now to talk about, well, what is it that you want to leave for a legacy, if at all? It’s been surprising to find a lot of clients are like, “I want to bounce the last check.”
Brenna: Of course.
Josh: “My kids are fine. I want to go travel, I want to do these things.” So, I really like that perspective that you have.
Brenna: I had one client family – in our world, the Monte Carlo is sort of this percentage (obviously, you know, Josh, but I’m just sharing), a percentage of the probability of success, meaning you will have money at the end of your life. That’s how that measurement defines success, which, to your point, is not success to everyone. I had one client who actually wanted me to add another spending lever in their financial plan, and we titled it ‘die with zero.’ Every year, we come in, and we shift that lever around a little, and say how much more can we spend and what does that look like? Rarely is there a year where they ask for a distribution of that size, right? But, I think having that information empowers them to be able to say, “I want to be able to do this gifting for Christmas or support this organization to this extent.” They have the information in the confidence that they can do that.
Josh: I think this goes back again to things that are hard to measure or quantify. I had Deborah Goldstein on last week, and we’re talking about philanthropy and what a difference it makes in people’s happiness and fulfillment in their own lives. That’s another aspect of it, I think, that gets overlooked. I was always taught that this was sort of the 1% of the conversation, philanthropy and giving, and maybe cherry on the top, and I think the reality is for a lot of people, especially retirees, it’s a big part of what they’re thinking. Whether it’s their kids, or alma mater, or the environment, or what have you, giving back really enhances their retirement and gives them a sense of purpose. I think that’s really cool and important to be talking about with retirees.
Brenna: And letting them lead the conversation in a lot of ways and bringing up, “Have you thought about it this way? Have you looked at it from this angle?” I think that’s where I see that so beneficial. And sometimes it looks like traditional charitable gifting, and other times, it looks really different. Giving the client permission and saying, “However it looks to you is the right way.” I hear a lot of people say, “I should be giving more. I should be doing this,” and I’m always careful to encourage people not to should on themselves.
Josh: It’s important. There’s a lot of misinformation out there and a lot of people telling you how it should be, but really, it’s up to them as a client. Even us; I think of us as stewards or guides or coaches. We’re not the end-all-be-all either. We’re there to offer ideas and guidance, but ultimately, it’s their life, and they should be able to design it in a way that’s meaningful to them. I wanted to segue to, I know you talk about transitioning to retirement in the four rich opportunities to make the most out of it. Could you expand upon those?
The Four Rich Opportunities in Retirement
Brenna: We talked a little bit about this before, about the first step being self-reflection and figuring out what it is that are your priorities, what are your values, and – to what we were just talking about – what kind of legacy are you building? You’re building one whether you’re trying to or not; that’s important to remember. And then, what do you do with that self-reflection? Are you living in a way that’s elevating those priorities and those values? Are you in alignment? Are you happy with that legacy? If not, you have a choice.
Awareness is step one, and then you get to choose what to do with that awareness. Those first two steps are really the ones that we often do with our client families, and sometimes things come into focus and are clear enough with those two steps that your client says, “Yes, this is making sense; this looks like me and what I care about. I’m ready to move forward.”
Other times, people want to do more deeply. There are opportunities for personal growth, and I’ve seen people decide to pick up some books, spiritual practices, start therapy, or those kind of things to continue that deepening. That’s the third optional step for some. Then the fourth and, I guess its highest peak might be that there’s a transformation that occurs for people. It’s not to say that everybody needs a transformation. I don’t think everybody has a Scrooge story that’s a 180 to how they live their lives and spend their resources, but instead, it might be the shift from a life of complacency to a life of contentment. That’s a phrase I use a lot with client families. It’s a fine line between those two things, or it can be, when we’re talking about finances. Another line I like to think through in this phase on people are building what they want their ideal retirement to be like is: let’s make sure we are living in wisdom and thriving in grace.
In this last 30% of life where aging – my grandma used to say, “Aging is not for babies,” it’s not; it’s not easy; it’s really, really hard – so, if we can hold up living and wisdom thriving and grace as our litmus test for success, that feels like a pretty good measuring stick.
Josh: I really like that perspective. Aging is not for babies.
Brenna: That’s what Barbara always said.
Josh: I think that’s the perfect transition to values-based investing. I know that it is the deepest of rabbit holes, and we can talk for hours about it. There’s some people who build their entire practices and teams around values-based investing, but how does that play a part in everything that we’ve been talking about today and really living your ideal life?
Brenna: Just like we talked about multiple ways and multiple resources, types of resources to use – money, time, and energy – each one of those has an extra layer you can go into and think through.
With money, we talked about charitable, and there’s also the ways in which it’s invested, the ways in which it’s working for change in the world, or not. I meet with a lot of client families who say, “I want to do what’s right (which is very subjective), and I also need to make sure that my level of participation isn’t going to impact my returns. I want to do what’s right, but I also don’t want to sacrifice too much.”
I think it’s a common view and, gratefully, I think it’s a little bit outdated. Ten years ago, fifteen years ago, socially responsible investing and those types of things used to be very expensive. The internal expenses of those types of investments used to be quite high. It was also relatively new. Now, there are a lot of companies using ESG (environmental, social, and governance) protocols as litmus tests as they build out boards with equal representation on those boards, both diversity and gender, racial diversity, and what it’s doing in the world. Are they changing? Are they investing in solar, wind power, alternative energies, those kind of things? There’s all sorts of ways now for investors to explore a little bit more deeply without the sacrifice of performance that it used to be. There may still be a variance, right? But not nearly what it used to be because there are so many more organizations and companies on the scene moving in that direction. I think over our careers in this industry, we will see so much more change in this. It’s really inspiring to see so many people doing that hard work, that research to be able to empower that part of an investor’s portfolio.
Josh: I think you’re spot on. I love that it’s moving in that direction. I want it to keep moving in that direction. I’m excited for what’s to come, and maybe this is me backpedaling a little bit, but I was just thinking, you were just mentioning before, as people go through this transition into retirement, some of the other professionals they meet with that can actually enhance what they’re doing with the financial life planner. You mentioned therapy, maybe a spiritual advisor, maybe coach. Are there other professionals that you refer to, or do you suggest other people go seek out for themselves that can stack on top of what they’re doing with the financial life planner to enhance that process?
Partnering with Other Professionals
Brenna: You probably are of the same mindset, given our similar history in this profession.
There used to be the stool with three legs and we used to have: the CFP, the estate planning attorney and the CPA. Most client families that I know who are happy, and not spending more time than they want to thinking about it or worrying about their money have those three professionals. And, now there’s all of these other opportunities that are really unique to individuals.
I make it a common practice to recommend, to at least provide resources to people, about financial therapists – I know you had Nate Astle on your podcast before, he’s a lovely person – to make sure that people have that opportunity, because I only get a couple of hours with them. Through a year or through our planning work together, I don’t see them often enough to know if that’s really – I might have a sense – but, that can really be a powerful resource for people that they may or may not need now, maybe later.
Deborah Goldstein, also in terms of the philanthropic advisor. Those types of conversations are helping to deepen the unique pieces of what it is someone needs. Those are the two most common: let’s make sure you have resources for a financial therapist. That’s not strange or wrong; that’s normal. A lot of people benefit from that. And, how do we deepen this conversation and bring in a thought partner with us to sit down with us on gifting? Those are probably the two biggest ones, and you nailed them even before I said them in terms of other resources and professionals to partner with. I love that that’s a great part of our job, too, is kind of playing quarterback for people in that way.
Josh: It’s incredible how wide and how deep financial planning can go. I always say that the more I learn about finance, the more I realize how much I don’t know. There’s so many fields like that, but I think I would have told you early in my career that my pursuit of education was to sort of do it all, and now I realize just how silly that is. It’s really about finding these professionals who are experts in that one thing, and you can lean on them and be the quarterback for the client to say, “Hey, I know enough to be dangerous about what you’re talking about, but I know the best person for you to talk to in order to move this forward and make meaningful progress.”
Brenna: Yes, I often say, let’s go together to this meeting because I also want to be a part of this, to learn. And most of the professionals are so welcoming to having that be a collaborative experience; not the therapy, probably, but the other piece is for sure.
Josh: Definitely. So, I want to transition to the big three – the three questions that I ask everyone. These are more personal to you. Question number one is, what does living a wealthy life look like for you?
A Wealthy Life
Brenna: I think it means connection with other people. One of my core values is connection and growth is the other one, so connecting and building communities and continuing to grow my brain and learn; and laughter, too. I don’t think we laugh as adults. Having those three core elements are important and that would be wealthy life for me.
Josh: I love that. If you could give one message to someone working to gain financial freedom who isn’t there yet what would it be I it would be?
Brenna: Whatever it is that you’re facing, it’s unlikely that it hasn’t been faced before. Whatever opportunity or challenges that are in front of you, someone else has probably traveled that road before.
It is not the sexy stuff that’s going to get you to your goals. It’s the small steps repeated over and over again.
I’m a big fan of James Clear, and he has this saying, “You don’t rise to the level of your goals; you fall to the level of your systems.” So, create solid systems. That would be my advice, whether that’s automatically increasing your 401k when you get a pay increase or hiring a CFP to keep you on track – creating those systems to support incremental growth for your definition of a wealthy life, to use your terms.
Josh: I love that you went there and building the systems out – so I’m going to totally just sidetrack now. This happens a lot in first or second meetings, where people are kind of stuck. or frustrated, or on the hamster wheel, or whatever language you want to use. They’re at this point in their life where they are hiring someone to get over this hurdle that they just haven’t been able to figure out for themselves. How does mentorship or finding someone who has walked that path, how does that fit in? I know it’s been transformational in my own life. I always say there’s no way I would have got to where I am in life without finding people way smarter than me, way better than me at what they do, and just spending time with them. How does that fit into how you work with clients and the people who are stuck and are sort of “woe is me, this is only happening to me,” do you suggest they go seek out mentorship or someone who has been there before?
Brenna: I do and, in part, that goes back to my value of connection. I think connecting with other human beings is the reason we’re on this planet, and there is so much value in learning from people who have been where you’ve been. I think you and I, on our journeys to start our own practices, have been very fortunate to meet a number of advisors; that had been our focus area.
For client families who are thinking through, “I don’t know if I’m ever going to get past this point,” it’s not uncommon to have that conversation go in the direction of, “Is there anyone you can identify in your life that you think is done this well? That is living a life that you like; that you think, ‘That’s how I want to be, that’s where I want to be?’” Usually, there is a person that you can think of. We’re kind of talking about this in the form of what would you tell someone who’s not financially independent yet, but that’s true even if you are one of the retirees we were just talking about.
You identify somebody who you think is doing retirement well? And seems happy? Take them out to lunch! Take them out to lunch and bend their ear. Talk to them about what set up some of those goals, what are some of the motivators behind it and see if there’s any overlap. Again, it’s not that they have a boat, you want a boat; it’s just getting to the core of that and I think hearing from people who have been there always makes that journey of it easier.
Josh: I love that idea. The hardest question of the day: if you only had $1,000 and we’re starting over what would be the first thing you would do with that money?
What to do with $1,000?
Brenna: If I had $1,000 and I was starting over, I think I would hire someone to tell me what to do with it. I really do see the value, every day, in what CFPs do to help their client families figure out the right direction and feel the level of confidence that they made the right choice. Otherwise, you’re sort of hemming and hawing, “Did I do it right? Or maybe I should have done this?” So, sitting down with someone, let’s say in that after-college scenario, to help maximize my employee benefits and come up with some of those systems that we were just talking about. Budgeting, saving for a house, paying off student loans, planning for kids or for retirement – all of that stuff needs a plan. Everybody can benefit from a plan, whether you have $500 or 5 million dollars. A plan can be very helpful, so certainly, $1,000 falls in that range too. Getting some systems in place that you can rely on that are going to feed you for the future.
Josh: I so agree with that answer. I’ve sort of adopted this word of a road map, in a certainly not original to me, but I have been thinking about this a lot over the last year of the value that we provide, and I think a lot of it comes down to the road map and the accountability that we give people just to stay on track of, “Hey, we’ve talked a lot about your ideal life, we’re building you a road map to get there, let’s you know help you stay on track with that.” I think back to my 20s and how fiercely independent I was, and I wore it as a badge of honor, and just how wrong I was not have the road map, no accountability, and just trying to figure it all out of my own, and how much slower the journey probably went because of that.
Brenna: When I think about a road map – I like that visual – but I also picture a huge map with an X here and a dot here, “you are here,” and then it’s this tiny line sort of between, so it’s that, but it’s also – remember MapQuest?
I don’t know if you’re old enough to remember MapQuest? Where every single step was printed out for you? “Then turn left on this road, then turn right on this road.” That, if I had to quantify what a financial plan is, it’s both the big map and the step-by-step. That’s the piece, I think; those are the systems. The map is one thing, those are the systems you need to move meaningfully, continually in the right direction.
Josh: Definitely, and I think something that I’ve realized has a planner is there’s a lot of value in establishing that relationship because life happens, and you will take a detour from your plan. Something will happen, someone will pass away, you will get injured, you’ll have a child or whatever it is. I think there’s a lot of value to say, “Okay, you know me and my life plan intimately; this just happened. I’m on a detour; we got to redo the road map,” and to have someone side by side with you, and not go out that alone, I think there’s a tremendous amount of value, and it’s hard to quantify.
Brenna: Yeah, you know we never have anybody – at least I don’t have anybody – call me because they’re bored. Everybody calls me because they’re at one of those life detours, and so, to your point, walking through a detour like this is a really great way to get to know somebody and then to continue to have that relationship with folks over time – celebrate birthdays and anniversaries – ah, it’s what makes this so lovely; such a great career.
Josh: For listeners who want to connect with you – we’ll put all the show notes/links in the show notes – what is your preferred place for people to go and connect with you?
Brenna: I post semi-regularly to LinkedIn and have company pages – Collective Wealth Planning – on LinkedIn and on Facebook. Those are the only two social media – speaking of MapQuest – those are the only two social media things I can figure out at this point in my life. I’ve been called the geriatric Millennial before, and I’m really showing it right now. But, those are the two good places. I post to my blog pretty regularly: video and educational pieces for people to take wherever they are in their journey; I have a newsletter that goes out once a month so, lovely to connect with anybody that would find value in that – I welcome you to come on over.
Josh: We’ll link those below, and I would encourage everybody; I love the newsletter, personally. Is there anything that I haven’t asked you? Anything else that you’re just itching to cover?
Brenna: Well, I think the one piece that is probably its own podcast, for part two for us someday. We talked a lot about the technical transitions that people go through when they’re thinking through retirement.
We didn’t talk about how fraught the concept of retirement can be for some people; we touched on it a little. But, that transition, particularly if it’s abrupt, from full-time work to no work, is emotionally, physically, maybe unrealistic for some people.
I was just listening to a podcast geared toward advisors like us. They were talking about how maybe instead of full stop, “Here’s where you are,” it’s, “Here’s what life looks like if you stop contributing to retirement accounts and you just do something to pay your bills, so you’re not touching your retirement accounts but you’re also not contributing to them.”
That gives some financial freedom and flexibility in the transitional years, especially if people are itching to get out of work by the time they’re 60. That’s still a lot of life left to live. If instead, we can reframe the conversation, I put that on all advisors, us included, to say, “Well, yes, and…” You can do this, and it’s important for us to think through and collaborate about what looks like, how are you spending your time. I think that’s important for people to think through. It was Carl Richards who said retirement is dumb; the concept of retirement is dumb. There’s something to be said for planning how you’re going to spend your time and making sure it’s fulfilling and purposeful.
Josh: 100% agree. I’m fascinated by that and could talk to you about that all day long. I’ve got Derek Hagen on the podcast and a week or two, and so I’m going to pick his brain about exactly that.
Brenna: Oh, I can’t wait to listen.
Josh: For sure. Well, I think that’s a perfect place to wrap, so I just wanted to say thank you for being here. This has been amazing and fun.
Brenna: Thank you, Josh, it was so great to see you and give my best to Amanda. Thanks for having me on.
Josh: I will. This has been the Wealth in Yourself podcast, where we help people to design their ideal life and take control of their time and money. Our guest today was Brenna Baucum. We’ll see you next week, and thanks for listening.