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Wealth Is a Tool, Not a Trophy with Gary Preisser | Financial Planner Search · Financial Planner Search

• Chase: All right, Gary, thank you so much for joining me on the podcast today. I've been looking forward to it. Gary Preisser: Thanks so much for having me. Chase: So let's dive right into it, Gary. Tell us about your practice and what you specialize in. Gary Preisser: So at Stone Briar Wealth Advisors, we focus on functional wealth as we call it. We wanna make sure that your money is working for you and working for our clients. and most of our clients are retirees. We have clients of all ages and in all walks of life, but especially as they get to that retirement, I spend a lot of my time reminding my clients that every dollar they have is gonna be spent by somebody at some point in time. And it might as well be them because it's their money. And so we really specialize in making sure that every dollar that that our clients know that every dollar has a purpose and needs to be used and utilized to add value to their lives and to the lives of their family. And so that's what we really focus on at Stonebrier. Chase: And so that's kind of your definition of functional wealth is that it's applied to a purpose essentially. Gary Preisser: Absolutely. we talk a lot about risk profiles and we talk about average rates of return. There's lots of ways that we value wealth. But as I like to say, wealth or your assets are not trophies. It's not something to show off. It's not something to brag about. Your wealth is a tool. And just like any tool, a hammer or screwdriver, whatever it is, the only value of that tool is how is it being utilized? Is it fulfilling the job that it's been given? And for most of our our lives, the only job for our wealth is to grow. But at some point in time that we we have to shift from accumulation to distribution. And at that point, especially, we want to make sure that that money is available to work, to function when it's needed. Chase: So what inspired you to get into this business, Gary? What's your origin story? Let's hear it. Gary Preisser: So I actually started in the tax realm doing tax preparation. That was kind of my first experience at financial planning. I grew up as son of of teachers in Florida. My dad was a football coach, my mom was an English teacher. I didn't understand finances at all. We didn't have enough for us to really know what to plan, right? and so when I was introduced to I had opportunity to work for a CPA firm and I learned a lot about what people don't understand about money. I had early clients that would get super excited that they they got a ten thousand dollar tax refund. What are they gonna do to spend that tax refund? And how excited they were, isn't this great? And they didn't realize that they had loaned the the government their money for over a year interest-free. So their their perception of how WELLT worked versus the reality was very different. And again, being the son of a teacher, that really stuck with me, that bothered me. I then got into small business consulting, and what I really appreciate about that is every decision that my clients were making. should be based on cash flow. And that applies to everyone, small business owner or not, where you live, where you work, where your kids go to school, where you vacation, even what you eat is based on your cash flow needs. And then when I was introduced to this industry, it's been what, seventeen, eighteen years now. I was just, I was kind of shocked. I really didn't understand why, instead of talking about these things that I'd been talking about the rest earlier in my career was with my clients, instead we were talking about a sheet of paper with some questions on it about feelings. How do you feel about risk? How do you feel about volatility? And that instead of talking about cash flow and some of these more tangible things, and that's one of the things that really stuck out to me. I I feel like this is not functional. This is not how it should work. There's a better way to do it. Chase: So yeah, wow. So you went from just talking about cash flow to looking at a sheet of paper with a list of questions about feelings and risk tolerance and stuff. How did coming from that, you know, small business consulting and tax background influence and shape the way that you started to you approached your business now? Gary Preisser: I d I drive everything based on cash flow. It's when we need the money. It that is so important. And our industry isn't geared for that. And I'm not sure exactly why. We don't have time to to really explore that right here. But it can be done differently. And what I learned is I would I would start about cash flow and the timing, but really what's most important. Is why do you have the money? I really appreciate Simon Sinek. Start with why. We gotta start with purpose first. If we understand the why, if we understand the purpose, then we're gonna know when the money is needed. And if we know when the money's needed, then the investments become so much more clear. If you tell me you need $25,000 in six months, well, I know a couple of things right off the bat. I'm not going to put that money in Bitcoin. I'm not going to put it in SpaceX. I'm not going to put it in the market at all. I'm also not going to put it in a 12-month CD. There's no volatility with a 12-month CD. It may be considered conservative, but it's not going to be liquid and available when you need it. And so by driving everything based on the timing of when the money is going to be needed, then that really allows us to create portfolios that function at that proper time. And what's also interesting about this, and you've got a lot of experience with this, talking to other advisors, every advisor has their own flavor or their own preference for how they do this Chase: Hundred percent. Gary Preisser: process. But what's interesting to me is the end result is almost always exactly the same. Because if you're a 65-year-old that based on your questionnaire is moderately conservative, you're probably gonna be in the same portfolio as every other 65-year-old that's also moderately conservative. With our system, because it's based on our client's individual tax or cash flow and timing and purpose. Now our process is the same no matter what the client is. But the result is very specific. It's very unique, it's very customized, it's bespoke, as they say, because it's tied to their needs, not to everybody else that's somewhat similar. Chase: Interesting. So on that note, what kind of person do you find gravitates towards you? Who who comes to you? Gary Preisser: Most of our clients are retirees or on are on the verge of retirement because now their purposes multiply exponentially. When you're 20 years old, your main purpose for your Roth IRA or Roth 401k, if you have it, is to grow. You're not going to touch that money for 40 years at least, maybe 60, 70, 80 years. So growth is very straightforward, and that is simple, and that is very important. Let me be clear. But as you're getting to 60s and 65, 70s, 75, et cetera, and now you're going to rely on this money not only to live on from a month-to-month standpoint, but also to be able to do those things that you've always dreamed of doing. now the the allocation needs to be very different. And the problem is that Our s our the industry solution for that is these target funds or glide path funds, where you get closer to twenty thirty-five, you're gonna be put more in bonds. And I saw this very clearly in 2022, especially the beginning of 2022, the stock market was down, interest rates were going up, which we knew were going to happen, and so the bond values Chase: Yeah. Gary Preisser: were going down, and the interest rates hadn't gone up enough so that our cash was still lagging behind, so our savings account wasn't making any money. So those that were retiring at that time, where did they pull money from? Stocks, bonds, cash, it was all bad. But if we create a plan and understand the timing, then we can we can actually design risk out of the portfolio, but it also allows us to create something that where the lifestyle continues no matter what's happening in the market. And that's what's really critical. Chase: And so when they first come to you, what are some of the questions that they typically ask when they meet you for the first time? Like what's keeping them up at night? Gary Preisser: Whether they can retire, whether they're gonna run out of money, that's the usually the first question. And for most of the people that are coming to me, that's really not the concern. It shouldn't be the concern because they've done such a good job of saving. The big the bigger concern should be how do how do I get my wealth to work efficiently? And this is critical from a risk standpoint, first of all, from a volatility standpoint, we measure average rates of return. If I ask a prospective client, if I get you a 7% rate of return, is that good or bad? Most people would say, that's great. I'm happy with that, right? Their previous advisor said, Well, if we run your Monte Carlo simulation and you average 7%, you're not going to run out of money, you're going to be okay. But if I give it more context and I say, well, what if the market's up 20%? Are you still gonna be happy with that seven? Well, I'm conservative, so I don't expect to make 20. That's okay, I appreciate that. What if you're taking half the volatility of the market and the market's up 20 and you're only up seven? Are you still happy with that seven? And the reality is they shouldn't be. They were before, but with contacts, they realize if they're taking half the volatility, half the beta, as we call it. They should be getting half the reward. If they're not getting half the reward in that year, then they are underperforming the benchmark. That's what's what we call alpha. If they're underperforming by three, that's a negative three alpha. If you underperform year over year over year, that can be so destructive. So from a risk standpoint, I want to make sure that my clients are getting at least zero alpha, if not outperforming the benchmark, getting consistently positive alpha. So that's one way to make things more. Efficient. The other thing we look at is taxes because taxes affect every decision that we make, and unfortunately, if Chase: Right. Gary Preisser: you have a financial advisor, in most cases, they're actually an investment advisor only who tells us we can't, we're not gonna don't ask me about taxes, I'm not responsible for your taxes, even though every recommendation they're making affects taxes in some way, shape, or form. And if you have a tax advisor, what you actually have is a tax preparer who's looking back at last year. We need to bring these together to make sure the taxes and the investments are working together for efficiency. Chase: And that involves looking forward instead of just looking back, right? Because your tax return is just a record of what already happened, right? Gary Preisser: Absolutely. Tax forecasting is so critical. Most people don't even have never had a tax forecast, but it is absolutely essential because that allows us to make decisions. We want to be intentional about when we pay tax. Because when we pay tax determines how much tax we pay. If you have a million dollars, you have to pay tax on it all in one year, you're gonna be in a much higher tax bracket than you would be if you spread that out over a 10-year period. So timing is really critical. We need to look forward and decide for each client when is the best time to pay tax. I joke with my clients because it sounds weird. I want them to pay as much tax as possible at lower rates. So that they avoid tax at higher rates. So it's not this it's not about avoiding taxes, and it's certainly not about evading taxes. Let's be clear about that. But it's about intentionally paying taxes at the most opportune time to do so. Chase: One's a crime, the other was is a strategy, basically, right? Gary Preisser: That's exact that is exactly right. You nailed it. Chase: so and then when you when you're talking to your clients about you know, the rate of market returns versus what they're getting from their conservative accounts, what are the reactions you often see from them when you're talking to them about that? Gary Preisser: It takes a lot of education because I've ne Chase: Right. Gary Preisser: I've talked to thousands and thousands of clients, and I can probably count on two hands the number of people who have actually heard the term alpha and know what it means and know what their alpha is. And just so you know, I'm not crazy. If you're listening, please go on Morningstar and look up some of your mutual funds and go to the risk tab, and it will show you right there your beta, how volatile is that investment, and the alpha, how well is it performed relative to that volatility. But advisors don't talk about it. And unfortunately, the reason why is I think the stat I've heard most recently is that 96% of mutual funds and money managers underperformed the benchmark. Well, how do we solve that? Quite simply, as Warren Buffett says, if you can't beat the benchmark, be in the benchmark. If you want to take half the volatility of the SP, put half your money in the SP and put half of it in a money market, and you've come out ahead for free. So there are ways to get you positive alpha, but the first question, the first responsibility on our side is to make sure that our clients understand what does alpha mean? What kind of a difference does it make for their portfolio? What is their current alpha? And if it's not acceptable, how do we make an adjustment to get it in a better spot so that their assets and their plan will become more efficient? Chase: So what are some ways, like this is like a foreign concept to most people, like the the alpha and everything? What are Gary Preisser: Yes. Chase: some ways that when you're having conversations with your clients and they're trying to they're trying to get a grasp of this concept and what and what it means for them? What are some ways that you walk them through it and help them, help them understand it? Like if do you have any like Gary Preisser: Well, yeah, my my p business partner Shay, he has one that I'm not sure how well it works, but it it it seems to work, right? And it's about expectations. If we know the volatility, then we know what to expect. And again, this isn't about making money or losing money. It's based on how well do we do compared to the expectation compared to the benchmark. Again, if the market's up 20 and you're conservative, you're not expecting to make 20. You're expecting to make less. But if we don't know the exact beta, the amount of volatility, then it's it's impossible to know if you're actually meeting the expectations or not. And it's easy to say, well, don't worry about that, you're just conservative. So Shay's example is: if you go to the grocery store and you buy a carton of eggs, and you under your expectation is that there's a dozen eggs. Then you expect when you open that up when you get home that there's 12 eggs in there. Okay? Negative alpha means you open that up and there's only nine eggs. You expected 12, but you only got nine. No one would be happy about that, especially with the price of eggs these days, right? No one wants to Chase: Yeah, no kidding. Gary Preisser: buy, pay for something, and not get the full value. And yet, Every single day I see trillions and trillions of dollars that are getting nine nine eggs instead of twelve because they're consistently having negative alpha from their investments and they don't even know about it. If we can just change that, we understand compounding enough, whether you're 60 or 30 or 15, the power of compounding, if you can avoid that negative three alpha and just get to zero, and an extra three percent per year on your portfolio, what a difference can that make, not only for you, but for generations to come. It is so important. And that's one of the first things we focus on. Chase: You'll have a lot you'll end up with a lot more eggs, basically. Gary Preisser: lots of eggs for everybody. Absolutely. Chase: what's a typical situation that you'll lead your clients through? do you have any like specific stories that stand out in your mind where you help them get from point A to point B? Gary Preisser: Yeah, one of the one of the most critical ones that we we have dealt with more than we would like, but it's it's a part of life, is when a spouse passes. And this is Chase: Yes. Gary Preisser: something that is very difficult in a lot of ways. And my my wife's grandfather just passed away, and so sh she's dealing with this, helping out, and so there's a lot of organization and communication and documentation and all those things are very important. Okay. I don't want They are very important. But when it comes to investments and when it comes to your finances, a couple things that are important to understand. One of the biggest, most dangerous, most destructive things that I see over and over again is the widow's tax trap. Have you heard that term before? Chase: It's my first time. Gary Preisser: So when a couple is in retirement, they're married, filing jointly on their taxes. The 12% tax bracket goes up to $100,000 of taxable income. Then it jumps to 22%, then 24%, and then beyond. When one spouse passes, first of all, the surviving spouse is going to miss out on at least some of the income because one of the Social Chase: Yes. Gary Preisser: Security incomes will go away. There may be Chase: Yes. Gary Preisser: a pension that goes away, or there's couple other things. Secondly, they're typically going to be paying higher taxes. Because now they're filing single instead of married filing jointly. That 12% tax bracket that went up to $100,000 now only goes up to $50,000. So now their taxable income went from $100,000 down to $75,000. But instead of being comfortably in the 12% tax bracket, they are half of their income or a third of their income is being taxed at 22%. And that's something that we need to be prepared for as much as possible. We don't we can't tell the future. We don't know what it is. We don't know when either one will pass. But statistically speaking, one will pass before the other. And as I joke with my clients, I'm not looking for volunteers and I'm not making predictions Chase: Ha ha Gary Preisser: here, right? Well, I'll see my clients point to each other and that gets really awkward. That's a weird conversation to have. But it's important to be again proactive with taxes because during our career, the the general consensus is defer tax, defer tax, defer tax. Once you get into retirement, we've got to have a plan to pay that tax strategically and fill up those lower brackets before you're in a situation where now you're in a single bracket, now you have required minimum distributions, now you need money for income, and you're going to be paying 22, 24, or higher in taxes, whether you want to or not. Chase: So do you have any like do can you think of like one specific client that that comes to mind that that you helped through this process through the widow's tax trap or something similar? Gary Preisser: Yes, when she came to us, her husband was on dialysis for kidney failure. And so we knew that we had a short amount of time. We didn't know exactly what it would be. We our expectation was that he'd get a kidney transplant and that everything would be okay. but after getting a kidney transplant, his body rejected that. And then they had a couple of more options and a couple more options and finally got to the point where they ran out of options. And so during that process, not only being there for her to make sure that she had the cash and and liquidity that she needed, but it also was so important that we were aggressive with those that tax planning while we had that opportunity to take advantage of that, of those the more forgiving tax situation that she was in while he was still alive. So that now she is in a much better situation than she would have been if we had just said, well, nobody likes to pay taxes, let's just wait. Let's just Chase: Uh-huh. Gary Preisser: wait, let's just wait. And then poor woman, about a year after her husband passed, Her her old one of her children actually passed as well and left behind six kids and a widow. And that was completely unexpected, right? They had no preparation at all. So we saw from a generational standpoint the impact of of those deaths. And what from an emotional standpoint, we don't even need to get into that. That's obvious, but From a financial standpoint, it is such a problem. It is such a big deal. And it's impossible to to predict exactly when that's going to happen. But avoiding those conversations is not helpful at all. It's they're difficult conversations, but we need to make sure we're having them and making sure we're talking about the right things and that we understand we have to consider taxes. We have to consider efficiency from a risk standpoint. We have to look at making your money work efficiently because we can't assume that we have 20, 30, 50 years down the road to figure it out. Chase: So wow, what a tough situation, those poor people. What did Gary Preisser: Yes. Chase: and through all of that you have to deal with all of the the numbers side of things as well, which has got to be absolutely well, to put it lightly, difficult. What did those conversations look like and what did they what do you think they ex how do you think they experienced it on a tangible level through that process? Gary Preisser: It is very difficult. And the the good news is, and for most of our clients, this is the reality, we're not worried about them running out of money, even in her situation. She was going to have enough money. But the problem that I see time and time and time again is my clients are so used to saving for retirement, for saving for the future, they don't realize that they've arrived there. That this is what the money's for. I joke that all my clients are like the ants in Aesop's fable that saved food for the winter. But when I ask them what it what happened at the end of the fable, they they have no idea. They forgot. And I remind them, the ants eat the food. They didn't take selfies with the food. Look what we did. Look at our accomplishment. We got a gold medal. No. They ate the food because that was the purpose of the food. And for for our client who's the widow, she now has a family that needed her and needs her more than ever. And if she was still worried about running out of money, then she would it would be easy for her to say, I can't afford to come see you or go to my granddaughter's recital or my grandson's volleyball match or whatever that is, or avoid spending time with my sisters on a on a girls cruise or whatever, right? Because I'm afraid of running out of money. By creating that structure, by creating by designing a plan that actually functions. Now our clients are able to get through a very, very difficult situation. with the support of their friends and family and being able to support friends and family at the same time, that is where the true value is in our wealth. It's not about balances on your statement. It's about how can we utilize these assets to make a difference for ourselves and our family. Chase: Giving every dollar its its purpose, like we mentioned at the beginning. So Gary Preisser: Yes. Chase: it's it sounds almost like it's not just, you know, you're not just moving you're not just moving numbers around on a screen just for the sake of numbers. You're giving you're essentially giving the people permission, in a sense, to live the way they truly want to and need to live, beyond being, you know, scared all the time that they're gonna run out of money. Gary Preisser: Not only permission, but I absolute I actually have to twist arms sometimes. Sometimes I have to tell them, please spend your money. And it's it's not even that they don't want to spend it, they they've never it's never entered their mind that they could. Again, they're so used to saving for retirement, they don't realize they're there. I've got I g I pick on my my client Frank, who's always bragging about how much money he's saving. I'm like, Frank, you're 96 years old. What are you saving money for? You're not impressing me by telling me you're saving 200 bucks a month. I want you to spend an extra thousand dollars a month at least and do those things. I you know, and and time is too short. We don't know what the future is gonna hold, but I can tell you this: every single one of my clients is going to want to bungee jump less in 10 years than they do today. Now, I only have one client that has ever told me that they want a bungee job. But the point Chase: Yeah. Gary Preisser: is, if you want to do these things, if you have this bucket list, you don't need you shouldn't wait until 75 or 80 or 85 to do those things. First of all, we don't know if you're gonna be around this long. And even if you are, you're not gonna feel like doing those things nearly as much as you do now. So please take advantage of the time that we have because that's the one resource that we cannot replenish. Chase: I love the analogy too. You're not gonna wanna bungee jump more in ten years than you do right now. That's Gary Preisser: Yeah. Chase: great. so it sounds like the typical person who comes to you and who you work with, comes with a very, very conservative mindset. Is that right? Gary Preisser: That's usually why they're good clients for me. So I appreciate it very much. Chase: Yeah. Gary Preisser: I have had, I will tell you a brief story. I had someone come in from one of our seminars and they had eight thousand eight thousand dollar pension plus social security. They had twelve thousand dollars a month in income and retirement, which is fantastic. And they told me. That they had $70,000 of credit card debt, they were spending $15,000 a month. They didn't know what was happening. They had, they, they didn't have any money. And they were they were at a complete loss. And I'm and I asked them straight up, I'm like, what's your plan for fixing this? And they looked at me with a straight face and they said, Well, we're talking about bundling our ESPN and Hulu packages, which will save us about $15 a month. And I'm not a very good actor, but that was the best acting job I ever did to not just start laughing out loud, like how ridiculous is that? That's not going to work. the thing that frustrated me is the pigeon came from the Boy Scouts of America, and I was not a very good Boy Scout, but I do remember that Scouts are thrifty and they were not being thrifty. Most people, there's not much I can do in that situation, right? The clients that come to us that are able to retire, that that do have assets, they have saved their entire life, and I appreciate that so much. But there is a mindset shift that needs to be made. They are so used to an income stream and now they have an a pool of resources. They have access to whenever they want. We want to be strategic about it. We want to be efficient about it. We want to understand taxes. We want to understand volatility. But we ought to we want to start, we have to start with why first. What is the purpose? The purpose confirms when the money's gonna be needed, and then everything else falls into place just like it should. Chase: So I think we've got a pretty clear idea of who you do work with. Who is someone that you absolutely will not work with? Gary Preisser: anyone that's that is spending fifteen thousand when they only have twelve thousand dollars of income. the big I try to help as many people as I can, obviously, but the big problem that I have is sometimes I will have a client come in and they'll say, Here are my assets, just take care of it. Right? And on one hand, I appreciate that that I'm gonna do a better job than most others. I believe that, right? Because I I believe I have a system that's better, but That is not a partnership. That type of client is never gonna be satisfied because they don't understand the process that is required to create a plan, to maintain a plan, to adjust a plan. And unfortunately, I think our industry has really thrived on that. The typical interaction from my experience has been: an advisor says, trust me with your money. Don't pay attention to what I'm doing behind the curtain here, because this is too complicated for you to understand. And that is not true at all. There are complexities to this industry, absolutely just like every other industry. But it is not too complicated to understand what you should be doing with your money. And then the advisor says, when the market's up, look what I did for you. Even if they underperformed the benchmark by 3%. And when the market's down, they say, Well, that's that's life. That's what did you expect me to do? The market was down. That is not how it should work. This needs to be a collaboration, it needs to be a partnership. I don't expect my clients to have a finance degree and to understand all the nuance of what we're trying to do, but I do want them to understand what is the purpose of their wealth, what's the timing of when they need it to function, and how can we work together to design a plan that functions at that proper time, and then that we are able to adjust it as we need to. I joke that at Stonebriar we create perfect financial plans if we know when you're gonna die and everything Chase: Yeah. Gary Preisser: that's gonna happen to you between now and then and everything that's gonna happen to the tax code and everything that's gonna happen to the market, right? That hasn't happened yet. So in most in all cases, really, we're more like the Apollo Moon mission where we are constantly adjusting. We're a little bit off course, but by measuring properly, we never go far enough off course. We're 96% of the time we're off course, but we're constantly adjusting so that we land at where we want to be. And that's that's what creates a productive and functional wealth plan. Chase: The Apollo Moon mission. I love your analogies. You have a lot of great analogies. And also I Gary Preisser: Thank you. Chase: can tell, yeah. But I and I can I can also tell you like we we interview a lot of financial advisors like you. We also interview their clients a lot of the time when they're doing their messaging. And I can tell you a hundred percent, financial advisors' clients love it when they actually understand their plan and they're allergic to being talked down to and you know, with with a a lot of jargon and stuff. And so you would hit the nail on the head right there, man. Gary Preisser: Absolutely. Chase: where do you where do you typically find your clients or how do they typically find you? Like where do they come from? Gary Preisser: Most of our clients, we do a lot of educational seminars. We do some dinners, but we really like to educate. we talk a lot about taxes in retirement, especially, because taxes are different when we get to retirement. We talk a lot about estate planning. I think there's a lot of misconceptions about estate planning. When people hear about estate planning, they think of a trust and a will, which is absolutely important. But the first thing we got to figure out is do you have an estate? Or more importantly, will you have an estate whenever it is that you pass? There's money that will be passed on, and estate planning is not about passing assets, but it's about passing on values, it's about passing on purpose. And so, what do you want to do with that estate? Then, once we know those two things, then we make sure that the legal documents support that. But I think too often people just do an estate plan and they have a trust and they have a will. But they've never taken a step back to understand why. How is this supposed to actually function from an estate standpoint? So we do a lot of in-person seminars to help educate the community to get a better sense of these important financial decisions that are so critical and have such a big impact. And yet it's so difficult to get the right information, to know how to filter through what's real and what's not. And that's something we we try to do as best we can. Chase: I like I like the idea of of an estate not just being, you know, the assets, but be it passing on values and wow. That's I haven't heard it described that way before. so when it comes to your practice, where do you see it in the next three to five years? What's your vision for for you? What's what's the goal you're working on? Gary Preisser: The vision for for us and for me especially is to to make a bigger impact in the industry. And we have a great practice, we're very proud of what we've built. But there is such a huge need, and there's so much misinformation and and a lack of education. Our industry, in my personal view, does things backwards. And you like my analogy, so I'll give you another analogy while we're talking. my wife has had three knee surgeries in the last year. Okay. It's been a very difficult situation for her. When she went to the surgeon before the first surgery and told and talked about to talk about her knee, he asked her how old she was, which we don't need to talk about here, right? That's personal. Chase: Ha ha ha. Gary Preisser: and then asked her how much pain she was willing to endure to get the result that she wanted. Talked about how much pain, how she felt about pain overall, and what her experience with pain had been in the past. Not about how her knee was hurting, but how much she was willing to endure to get to where she wanted to be. And then he did something that I'd never seen a surgeon do before. He pulled out three scalpels and started to talk about them. He said, I got a scalpel here. This is really strong. Second one is really precise, it's really sharp. The third one is the best of both worlds. In fact, 82% of the people that use this scalpel are happy with their results. Now. Let me reassure you, this didn't actually happen. No surgeon would actually have this conversation, right? But as you probably know, Chase, this happens every day in the financial services industry. People walk into an advisory firm and they are asked, How old are you? And how do you feel about pain or risk? And they're assigned a risk classification, moderate, conservative, aggressive. Guess what? Those terms mean nothing to me because they mean different things to different people. They're so subjective. And then after that, they get the risk classification, they are pitched a product. This one does this, this one does that, and this one, based on our Monte Carlo simulation, 82% of the time you're gonna be happy with it. And it's just completely backwards. How are we creating customized plans when we're just basing it off of age and a subjective label? We need to ask why. Why do you have this wealth? What is the purpose of it? When are you going to use it? How do we design it so that it functions? Then we choose the tools that we want to use to actually implement that plan. So my goal for our practice is that everyone, every advisor or as many advisors as possible, start to look at things a different way. Instead of starting with what, let's start with why, which tells us when. That will help us understand how. And then and only then can we talk about what we want to do. Chase: And so is there anything standing in your way between you and that goal? Is there any challenge you're facing here? Gary Preisser: decades and decades of compliance and and scalable solutions and and products that are designed for for scale law of law of large numbers. most people that are in these products are gonna be okay. That's not good enough. It shouldn't be good enough for anybody. And so it is a mindset shift in the in the industry. And again, the reality is this is scalable. Our process, asking those questions, that's very easy to do. It doesn't really take that much more time. It's just different. And then the results, it's something that is so much easier to keep track of and to maintain and to measure. And it's so much more meaningful. What a difference does it make? Can it make? It's incredible. And it actually makes it better for the advisor as well, because now they're not being held responsible for their recommendations just because that's their preference. The decisions are being made based on the client situation. If the client situation changes, then those decisions change. That doesn't mean the advisor made a bad recommendation. It means that the purpose adjusted, the plan needs to adjust accordingly. So, this mindset that that's not scalable, I just don't believe it. I've seen it in our own practice. I've seen it time and time again. It is so much more effective and so much more meaningful for each individual client. And that's what that's what I hope we can help other advisors see as well. Chase: So let's say that I come to you today and I Gary Preisser: Okay. Chase: wanna I wanna be I wanna be I wanna be Gary's client. what does walk me through what does it look like? What does onboarding look like? What happens in the first four to eight weeks and what does it look like, you know, over the course of a of a calendar year? Gary Preisser: Great question. So the the first appointment is usually what we call a discovery appointment, very similar to other advisors. And what Chase: Right. Gary Preisser: we do is a functional wealth diagnostic. And we are looking at, okay, what is your current situation? And a big part of this is education. We have to talk about alpha and beta. We need to explain what's the difference between a Roth IRA and a traditional IRA. Some of these concepts that people have heard of, but they're not really understanding what they are currently in. The diagnostic is important because we measure something that's unique in our firm that I've never seen anyone else measure, but it's very important. Because our focus is function, the problem with function is you don't know if it's something's gonna work until it needs to work. And at that point in time, it's too late to do anything about it. So it's kind of like an engineer that builds a bridge. The bridge needs to work when the truck goes over it. But if the truck falls to the bottom of the river, well, it's too late to really make a change on the bridge. We've already lost, right? But what the engineer does is he measure or they measure functional capacity. Is the bridge strong enough to support that truck? We want to know that very clearly before we ever drive across that bridge. We're applying these same principles to your finances. What part of that diagnostic in that first appointment is to say your functional capacity is 40%, 70%, 120%. You may have plenty to accomplish every goal you can. or purpose you could ever imagine, you may not have enough. Based on that diagnostic, it's gonna tell us a lot about where you are. But what I'm much more worried about to your point is where do we go from here? So there's usually some easy things. We're not gonna necessarily change anything as far as how much you have, but we're gonna change where those assets are, how they're allocated, how they're located from a tax standpoint. Let's see what we can do to improve your capacity from 40% to 70%, let's say, just with some easy changes. But the next stage is it may take a little bit of this takes a little bit of time, a couple of weeks to your point. And Chase: Mm-hmm. Gary Preisser: it takes some education. And it and one of the biggest issues with this, the biggest bottleneck is that when I ask clients what is your purpose for this money, they've never considered that. Chase: Yeah. Gary Preisser: So I have to give them homework and send them home to talk that through and to really understand what is the purpose, what are we designing for, what's the timing we're we need to take into account. Then once we get those allocated as best we can, the real goal there or the process from there is that we are adding value now. We're more tax efficient, we're more risk efficient, because we now instead of a negative three alpha, we're at least at a zero alpha, if not a positive three. Positive three is even better, right? We'll take that. And what has happened over the course of the next year? We're going to see how the plan, how the portfolio changes. And we're going to going to talk to our clients on a regular basis, at least once a quarter. A lot of advisors call these review appointments, but I don't care about what has happened. What I care about is how's your cash flow now? What has changed? Where are we at? Well, how's your purpose changed? What can we do better to make it more efficient? And I'll give you a quick example. In June of this year, we looked up as we're doing our quarterly reviews, as they call them, we call we like to call them realignment strategy sessions. But as we're meeting with our clients, I'm noticing consistently that our clients are up 45% in their portfolios year to date. The market's up 10, we're outperforming. That's where positive alpha comes into play, right? And now what that what does that mean? I don't care about the average rate of return. What it means is that my clients have more money. Now the question is, you have more than we expected. What do you want to do with it? Do you want that, do you want to leave more money to your kids? Or do you want to use this money to go on that trip that you've been talking about and you haven't felt comfortable going on? The answer to that question will will help us determine how do we make the adjustment to the portfolio. If they want to leave it for the kids, well then maybe we just let it ride and let it keep growing. If they're going to spend it in six months, well now we got to take that out of volatility, harvest those gains, and then get that money so it's liquid and available. And this is the constant process that we use at Stonebriar. This is where the functional wealth is so critical to be able to make those adjustments and make sure that the plan is always in that moment as capable as possible of fulfilling function when it's needed. Chase: And that's ultimate purpose, isn't it? Not just moving Gary Preisser: Absolutely. Chase: the things the numbers around on the screen, but helping these people live their best lives. I love that. Gary Preisser: Absolutely. Chase: So for someone who has been listening so far, Gary, and your our conversation has resonated with them, and they want to get in touch with you, what should they do next? Where should they go? Gary Preisser: So go to my website, stonebrierwealthadvisors.com, and there's a little schedule, little button there says schedule a meeting, and we'll get you scheduled either in person or on a Google Meet or a remote phone call, whatever it is, and have a conversation. Please. Have a conversation about this. Even if you already have an advisor, this is if you've listened to what I'm saying, you're probably hearing things that you haven't heard before. And it never hurts to get a second opinion, please. That diagnostic that we talk about. about we call it like the blood work for your medical, right? Getting a sense of where you currently stand. We offer this complimentary. We want people to understand where they are and how how well prepared they are to fulfill their purpose. Whether you work with us or not, it's worth the conversation. Chase: Awesome. Gary, thank you so much for joining me on this podcast episode today. it's been a great conversation. Thank you so much. Gary Preisser: Thank you, Chase.