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Jonathan Clements Explains Why Dying is Hard Work · Masters in Business

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Speaker 1: Bloomberg Audio Studios, podcasts, radio news. This is Masters in
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Speaker 1: Business with Barry Ritholts on Bloomberg Radio.
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Speaker 2: This week on the podcast boy, What an extra special
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Speaker 2: guest I Have? Jonathan Clements was the personal finance columnist
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Speaker 2: at The Wall Street Journal for nearly twenty five years.
0:27
Speaker 2: He wrote over a thousand columns. He also worked as
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Speaker 2: director of financial education at City Group. Jonathan kind of
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Speaker 2: famously announced that he was diagnosed with terminal cancer on
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Speaker 2: his website as well as social media, and that started
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Speaker 2: this cascade of not just an outpouring of affection and
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Speaker 2: appreciation for his work, but just a dialogue about how
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Speaker 2: we all should be thinking about our lives, our money,
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Speaker 2: and our life satisfaction. I've been a reader of his
1:02
Speaker 2: for forever, and it was really a privilege to have
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Speaker 2: him come into the studios and with no hesitancy, discuss
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Speaker 2: what many people find to be difficult subjects with just
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Speaker 2: tremendous grace and insight and dignity. And I found it
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Speaker 2: to be an absolutely fascinating conversation, and I think you
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Speaker 2: will also if you are at all curious about estate planning,
1:29
Speaker 2: or investing or personal finance. This is not the usual discussion,
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Speaker 2: and I think it's very worthwhile for you to hear
1:37
Speaker 2: this and share it with friends and family with no
1:39
Speaker 2: further ado. My discussion with Jonathan Clements Barrio.
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Speaker 3: It's great to see you again and it's great to
1:46
Speaker 3: be on your podcast.
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Speaker 2: Well, well, thank you so much. I'm glad we have
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Speaker 2: the opportunity to do this. Before we start talking about
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Speaker 2: the serious, heavy stuff, let's get a little background for you.
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Speaker 2: You grow up in London, you graduate Cambridge and you
2:01
Speaker 2: start at Eural money magazine in London. What were you
2:05
Speaker 2: studying at Cambridge? What was your original career plan?
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Speaker 3: So from a relatively early age, I actually thought about
2:13
Speaker 3: being a financial journalist because my father had been a
2:15
Speaker 3: financial journalist. He spent ten years in journalism in London.
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Speaker 3: He worked for the Daily Telegraph, he was city editor
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Speaker 3: for the Glasgow Herald. His first job out of college
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Speaker 3: was at the Financial Times. In fact, wow, and this
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Speaker 3: will blow your mind, Barry. My father graduated from Cambridge
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Speaker 3: in nineteen fifty six. He decided he was going to
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Speaker 3: take the highest paying job he was offered, and the
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Speaker 3: highest paying job he was offered the second highest paid
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Speaker 3: job he was offered at seven hundred pounds a year
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Speaker 3: was as a management trainee for Shell Oil. The highest
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Speaker 3: paying job he was offered at eight hundred pounds a
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Speaker 3: year was as a cub reporter for the Financial Times.
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Speaker 3: Can you imagine a world to where the highest paying
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Speaker 3: job you get offered out of college is a job
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Speaker 3: in journalism?
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Speaker 2: That's amazing. Journalism today has, you know, technology has changed
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Speaker 2: it so much that's really hard to fathom. Although you
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Speaker 2: and I not far apart in age, grew up in
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Speaker 2: an era where media was very specific and thought of
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Speaker 2: as a genuine career. I don't think even at the
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Speaker 2: journalism schools people are approaching.
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Speaker 4: It the same way.
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Speaker 2: What's your thoughts on the state of journalism in the
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Speaker 2: modern world.
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Speaker 3: Well, if you said to me, you know, what advice
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Speaker 3: would I give to somebody who wanted to go into journalism,
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Speaker 3: My aunts would be dope. I really feel like I
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Speaker 3: was the last generation that got into journalism and made
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Speaker 3: a career out of it and made a living wage.
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Speaker 3: But anyway, going back to your question, yeah, financial journalism
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Speaker 3: was always on my radar screen, and even before I
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Speaker 3: went to Cambridge, I actually spent eight months working for
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Speaker 3: a little suburban newspaper outside of Washington, DC, and in
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Speaker 3: many ways it was the most fun and then the
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Speaker 3: most educational experience I had in journalism. I worked for
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Speaker 3: this you know, rinking little paper that came out every
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Speaker 3: other week. The circulation was twenty five thousand, but as
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Speaker 3: a nineteen year old, I was able to not only
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Speaker 3: get involved in writing stories, but also I was involved
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Speaker 3: in the paste up of the paper. For people who
4:20
Speaker 3: remember what paste up was. I even went on advertising
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Speaker 3: calls with the advertising director. It was so much fun
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Speaker 3: and I learned so much.
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Speaker 2: So you're from the UK, but you've spent a lot
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Speaker 2: of time in the US. Where did you grow up?
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Speaker 3: Both places? I was born in London, and when I
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Speaker 3: was three and a half, my father got a job
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Speaker 3: for the World Bank in Washington, d C. So we
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Speaker 3: all moved to Washington, d C. Then, just before my
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Speaker 3: tenth birthday, my father was posted to Bangladesh for four years.
4:47
Speaker 3: So my mother and father and my sister went to
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Speaker 3: live full time in Bangladesh, and my two brothers and
4:53
Speaker 3: I got packed off to boarding school in England, which
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Speaker 3: explains everything you know. We'd go out there during vacations.
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Speaker 3: Four years later, my parents moved back to DC, but
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Speaker 3: with my parents' encouragement, I stayed on a boarding school
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Speaker 3: in England, went to Cambridge, worked there for a year,
5:08
Speaker 3: and then after a year as a journalist in London,
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Speaker 3: I realized the standard living for reporters in England seriously socked.
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Speaker 3: And that's when I decided to move to New York
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Speaker 3: City and I joined Forbes magazine as a glorified fact
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Speaker 3: checker and immediately doubled my salary moving from London.
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Speaker 2: Well didn't you also double your cost? New York back
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Speaker 2: then was still in the nineties, New York was really
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Speaker 2: an expensive place to live.
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Speaker 3: London is also a really expensive place to live. And
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Speaker 3: in any case, at the time, I was actually living
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Speaker 3: out in Princeton with my graduate student wife.
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Speaker 2: You go from Forbes pretty much during the golden era
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Speaker 2: of mutual funds and star managers, like the eighties and nineties,
5:53
Speaker 2: that was peak mutual funds. What was that like looking
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Speaker 2: at it as the data was begun coming clearer that hey,
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Speaker 2: this may not be the best deal for investors.
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Speaker 3: When I was at Forbes, after this initial spell as
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Speaker 3: a fact checker, I was given the mutual funds beat
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Speaker 3: and the core article as the mutual funds reported for
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Speaker 3: Forbes magazine and subsequently when I covered mutual funds for
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Speaker 3: the journal, was the star manager profile, and it was
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Speaker 3: very formulaic. You went and you interviewed some star manager,
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Speaker 3: usually a man, and you would have a couple of
6:28
Speaker 3: paragraphs about their investment philosophy and strategy. You would offer
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Speaker 3: three of their stock picks where they were probably touting
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Speaker 3: stocks they wanted download from their portfolio, and the managers
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Speaker 3: you selected were all based on past performance. And one
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Speaker 3: of the things I started to realize in those years
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Speaker 3: was the star managers, well, their stars started to flame
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Speaker 3: out pretty quickly. And this, of course was the experience
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Speaker 3: of many investors across the US, and that was in
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Speaker 3: many ways, you know, the seeds of the index fund revolution.
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Speaker 3: That people bought these star managers, you know, one after another,
7:03
Speaker 3: the managers started to flame out, they bought new star managers.
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Speaker 3: They ended up with these portfolios that were just a
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Speaker 3: hodgepodge of x star fund managers and that really set
7:14
Speaker 3: us up for the boom and index scene in the
7:16
Speaker 3: late nineteen nineties and into the two thousands.
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Speaker 2: Yeah. The funny thing is the behavioral aspect of mutual
7:22
Speaker 2: funds seems to have been when people finally learn about
7:27
Speaker 2: a manager who's put up great numbers. By the time
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Speaker 2: it makes it to Forbes, hey, most of that run
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Speaker 2: is probably over in a little mean reversion is about
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Speaker 2: to kick in. That experience led you to becoming the
7:41
Speaker 2: index guy. Tell us a little bit what it was
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Speaker 2: like being an index guy at a time when it
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Speaker 2: wasn't as popular or well thought of as it is today.
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Speaker 3: So in nineteen ninety four, at the lofty age of
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Speaker 3: thirty one, the journal gave me my own column, which,
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Speaker 3: in retrospector is obsurd. I have a thirty one.
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Speaker 2: Year old their own It seems to have worked out
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Speaker 2: well for them, though, to be fair.
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Speaker 3: Yeah, but I'm not sure I would give a thirty
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Speaker 3: one year old that that chance. Okay, but yes, I
8:12
Speaker 3: was given my own column. And by that point, having
8:14
Speaker 3: seen all these star managers come and go, you know,
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Speaker 3: I had become an index fund devotee. And in column
8:22
Speaker 3: after column I banged the drum for index funds to
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Speaker 3: the point where my editors were asking me, hey, could
8:28
Speaker 3: you write about something else? But the numbers you can't
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Speaker 3: argue with. I mean, we all know that the brutal
8:35
Speaker 3: math of investing before costs, investors collectively will earn the
8:39
Speaker 3: market's return after costs. They will earn that mark return
8:43
Speaker 3: less whatever they're paying. If you can just match the
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Speaker 3: market's return minus some tiny amount for an index fund's expenses,
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Speaker 3: you're going to outperform the vast majority of investors, and
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Speaker 3: that annual advantage snowballs over time. Until probably the early
8:59
Speaker 3: two two thousands, that message didn't resonate as widely in
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Speaker 3: pot because index funds were the preserve of bank gotten
9:07
Speaker 3: a couple other, you know, fun companies. But then these
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Speaker 3: ETFs came along, these exchange traded index funds, and at
9:14
Speaker 3: that point any financial advisor, any broker, could sell index
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Speaker 3: funds to their clients. And it was really the ETF
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Speaker 3: revolution that took indexing and turned it into a national
9:26
Speaker 3: phenomenon that now supposters the amount of money and actively
9:30
Speaker 3: managed funds.
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Speaker 2: So that's an interesting thesis. I know ETFs are really
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Speaker 2: significant to the adoption of indexing, But spy has been
9:41
Speaker 2: around for seems like forever. It certainly was around in
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Speaker 2: the nineties. What was it about the two thousands, specifically?
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Speaker 4: Was it just the variety of choice?
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Speaker 2: Why do you think ETFs kicked off so much attraction
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Speaker 2: to indexing, especially considering the bulk of those moneys, the
10:02
Speaker 2: flow of black Rock, Vanguard, and State Street.
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Speaker 3: Well, so you're right, you know, spiders Spy came out,
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Speaker 3: I believe in nineteen ninety three, but it was just
10:12
Speaker 3: the S and P five hundred and it was just
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Speaker 3: that single fund. The exchange traded index funds really did
10:18
Speaker 3: take off thanks to what was then Barclay's now part
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Speaker 3: of black Rock with the I Shares series, and suddenly
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Speaker 3: you could buy index funds that cover all of the
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Speaker 3: major asset classes, and you because they were stocks that
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Speaker 3: traded on the market, you didn't have to have an
10:34
Speaker 3: agreement with Vanguard or with Fidelity in order to sell
10:37
Speaker 3: those funds. You just needed a brokerage account. And suddenly
10:40
Speaker 3: every broker, every financial advisor where they were operating through Mery,
10:44
Speaker 3: Lynch or Schwab, could sell those funds and indexing was
10:49
Speaker 3: available to all. Prior to that, there were a lot
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Speaker 3: of brokers who would never have sold an index fund
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Speaker 3: because they didn't have access to Vanguard's platform.
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Speaker 2: So let me push back a little bit on that.
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Speaker 2: My experience has been that the brokerage side, at least
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Speaker 2: up until recently was much more interested in the value
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Speaker 2: add And I'm making air quotes for listeners of stock selection,
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Speaker 2: fund selection, manager selection, and they seem to have been
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Speaker 2: less keen on passive or indexing, whereas the RIA side
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Speaker 2: of the street, the independent advisor that or the certified planner,
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Speaker 2: they seem to be more focused on let's get a plan,
11:31
Speaker 2: let's figure out what your objectives are, and the market
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Speaker 2: will take care of itself. How do you see that
11:37
Speaker 2: that shift? I've watched that over decades. You you were
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Speaker 2: in the thick of it. I'm curious as to what
11:43
Speaker 2: you witnessed.
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Speaker 3: So you're right. I mean, these are traditional brokers were
11:47
Speaker 3: much slower to adopt ETFs than you know, the only
11:51
Speaker 3: financial advisors. But today you know a lot of brokers,
11:55
Speaker 3: you know, whether they're with the big full service brokerage
11:57
Speaker 3: firms now have advisory accounts. They flog to clients where
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Speaker 3: they can buy ETFs and as long as they're getting
12:05
Speaker 3: their fee, whatever it's you know, one one and a
12:07
Speaker 3: half percent, whatever amount it is, you know, they now
12:12
Speaker 3: have an incentive to sell those ETFs. And remember, if
12:16
Speaker 3: you're an advisor and you're selling ETFs, I mean there's
12:19
Speaker 3: no reason to ever say sorry.
12:20
Speaker 4: Right, that's right.
12:22
Speaker 3: You get the market's a ton surprise, surprise.
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Speaker 2: Well, if you tilt it all towards international or emerging
12:28
Speaker 2: markets or value, there are occasional apologies along the way. Hey,
12:32
Speaker 2: but that's what's the old joke. The cost of diversification
12:36
Speaker 2: is frequently having to apologize for something that's not keeping
12:39
Speaker 2: up with the SMP.
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Speaker 3: If nothing in your portfolio is performing badly, you're not diversified.
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Speaker 2: That's right, that's exactly right. So so you said something
12:48
Speaker 2: interesting that jog something in my mind. That you are
12:51
Speaker 2: constantly flogging passive indexing and ETFs, much to the sugarn
12:57
Speaker 2: of your editors, kind of makes me think of something
12:59
Speaker 2: Jason has said, which is his job is to write
13:03
Speaker 2: the same column over and over again, but in a
13:05
Speaker 2: way that neither his editors nor the readers know. What
13:09
Speaker 2: are your thoughts on repeating yourself over and over again,
13:13
Speaker 2: but in new and interesting ways.
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Speaker 3: So Jason was the next employee hired by Forbes after me.
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Speaker 3: That's hilarious. And when I left Forbes, Jason ended up
13:24
Speaker 3: with the Mutual Funds be Then he went onto Money Magazine,
13:27
Speaker 3: And then when I left the journal for the first
13:29
Speaker 3: time in two thousand and eight, they said, well, who
13:31
Speaker 3: should we hire to replace you? I said, Jason's why. So,
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Speaker 3: Jason and I have known each other for over thirty years.
13:38
Speaker 3: I consider him to be one of my best friends,
13:40
Speaker 3: and in fact, you know, through my recent diagnosis, he's
13:43
Speaker 3: been a super supportive You know, we remain great friends
13:47
Speaker 3: after all these years, and I'm a huge admirer of
13:50
Speaker 3: his work for the Journal and elsewhere. So, yes, Jason
13:54
Speaker 3: has the same joke that I do, which is, you know,
13:56
Speaker 3: there are only twenty postal finance stories, which means by
14:00
Speaker 3: the time I left the Journal and writing a thousand columns,
14:03
Speaker 3: I've written each of those stories fifty times each. If
14:06
Speaker 3: you are going to serve your readers, well, you know
14:11
Speaker 3: there are only a limited number of stories to be written.
14:15
Speaker 3: You know, if you're a reporter who spends their career
14:18
Speaker 3: writing the stock of the day, the fund of the month,
14:20
Speaker 3: just flogging one thing after another trying to predict the
14:23
Speaker 3: market's direction, you'll be plenty busy, but your readership will
14:27
Speaker 3: be a whole lot poorer. So if you want to
14:29
Speaker 3: do the right thing, you're basically going to have to
14:30
Speaker 3: have a set of sound principles and focus on them
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Speaker 3: again and again, and one of the things you discover
14:35
Speaker 3: is that you start to sound like a repetitive, blathering idiot.
14:39
Speaker 3: And that's when, for me, and I think also for Jason,
14:42
Speaker 3: you start costing around for other things to write about.
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Speaker 3: So when I go back to the late nineteen eighties
14:47
Speaker 3: and I started as a financial journalist, the sole topic
14:50
Speaker 3: was investing. It was all about which fund to buy,
14:53
Speaker 3: which stock to buy. Fortunately, over time, the field that
14:57
Speaker 3: is personal finance has expanded to today, if you are
15:01
Speaker 3: a good financial journalist, you should be writing not just
15:04
Speaker 3: about investing, but about topics like you know when to
15:07
Speaker 3: claim Social Security, what should you have in your estate plan,
15:11
Speaker 3: you know what sort of house should you be buying,
15:13
Speaker 3: and then beyond that, writing about things like behavioral finance,
15:16
Speaker 3: thinking about things like money and happiness. The topic that
15:19
Speaker 3: we call financial journalism has expanded enormously over the past
15:23
Speaker 3: three plus decades. And that's good news for somebody like me,
15:27
Speaker 3: because if I'm still writing only about index funds, I
15:30
Speaker 3: would have been out of a job a long time ago.
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Speaker 2: Really really interesting, So the twenty years you spent at
15:37
Speaker 2: the journal really is a fascinating couple of decades. You
15:43
Speaker 2: wrote at the Journal, through the dot com implosion, as
15:46
Speaker 2: well as the whole run up to two thousand, September eleventh,
15:50
Speaker 2: the Great Financial Crisis. What era of finance did you
15:54
Speaker 2: find the most intriguing as a journalist.
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Speaker 3: I know this probably sounds like I'm an ambulance chaser,
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Speaker 3: but you know what, the periods that I enjoyed the
16:04
Speaker 3: most was when the stock market was going down.
16:07
Speaker 4: I'm I totally agree with you.
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Speaker 2: I have been warned repeatedly, hey, people are getting, you know,
16:14
Speaker 2: really hurt out there. Can you stop whistling into the
16:17
Speaker 2: office like that? But that's when the most amount of
16:21
Speaker 2: fascinating things happen and the most amount of opportunities present themselves,
16:26
Speaker 2: Which leads me to my next question. Right into the
16:29
Speaker 2: teeth of the financial crisis, you went ninety five percent
16:34
Speaker 2: into stocks. Tell us a little bit about why you
16:37
Speaker 2: did that, which turned out to be the right call,
16:39
Speaker 2: and how you shared that information with your readers.
16:42
Speaker 3: Coming into sort of late two thousand and eight, I think,
16:45
Speaker 3: if I recall correct, I have somewhere between seventy and
16:47
Speaker 3: eighty percent stocks. By that point, I'd left the Journal
16:51
Speaker 3: and I was working at City Group as director of
16:54
Speaker 3: financial education for the wealth management business. And a number
16:58
Speaker 3: of things happened. One was I was working on Wall streets.
17:00
Speaker 3: I was earning a whole lot more money. Two, I
17:03
Speaker 3: got my first Wall Street bonus. Three I sold another book,
17:08
Speaker 3: which meant I got a big advance. And four tragically,
17:12
Speaker 3: my father was killed during this period and I inherited
17:15
Speaker 3: money from him, and I took every one of those
17:18
Speaker 3: dollars and put them into the stock market. And it
17:21
Speaker 3: was a time when the sequence of returns, that combination
17:25
Speaker 3: of what's going on in the market and whether you're
17:27
Speaker 3: pulling out money from your portfolio of putting it in
17:29
Speaker 3: worked like magic. And said to people numerous times when
17:34
Speaker 3: we have a period in like two thousand and eight,
17:35
Speaker 3: two thousand and nine when everybody thinks the world is
17:37
Speaker 3: going to hell in a hand basket, well, if it
17:39
Speaker 3: really does go to hell, doesn't matter what you own, right,
17:42
Speaker 3: More than likely, you know, we humans being humans, will
17:45
Speaker 3: figure out a way to solve this problem and the
17:47
Speaker 3: market will come roaring back, and what you want to
17:50
Speaker 3: own at that point is stocks. So I just backed
17:53
Speaker 3: up the cart and bought stocks like crazy.
17:57
Speaker 2: So that's kind of interesting that you're making an active
18:01
Speaker 2: decision in the face of market turmoil and increase volatility.
18:07
Speaker 2: Did at any point in that process did you feel like, hey,
18:12
Speaker 2: you know, I'm kind of going against everything I've said
18:14
Speaker 2: in the past. Or was it people said stocks were
18:18
Speaker 2: pricing now they're cheap.
18:20
Speaker 4: I'm just a value investor.
18:22
Speaker 3: Well, guilty is charged, Barry. I mean, I can't entirely
18:26
Speaker 3: justify it. But over my career as an investing the
18:31
Speaker 3: things that I've learned is one that you know, you
18:34
Speaker 3: can't win through stock selection. You can't win by buying
18:39
Speaker 3: actively managed funds. You know what you need to do
18:42
Speaker 3: is indexing. But one way you can tilt the field
18:46
Speaker 3: in your favor is in periods when people are panicking.
18:50
Speaker 3: Is too, as I like to put it, over rebounds
18:53
Speaker 3: to move even more into stocks. It's it's a temporary move.
18:56
Speaker 3: But you know I've done it repeatedly. I did it
18:58
Speaker 3: in two thousand and two thousand and two, I did
19:00
Speaker 3: it in two thousand and eight and nine, I did
19:03
Speaker 3: it during the coronavirus collapse in twenty twenty, and I
19:07
Speaker 3: did it again in twenty twenty two. You don't know
19:11
Speaker 3: what the bottom of the market looks like, I think
19:13
Speaker 3: it's very hard to say stocks are objectively cheap because
19:16
Speaker 3: all of these valuation metrics have become unreliable over the
19:20
Speaker 3: decades as the nature of the stock market has changed.
19:24
Speaker 3: But the one thing I have learned is that if
19:26
Speaker 3: the market is off twenty thirty percent, things are a
19:30
Speaker 3: whole lot cheaper than they were prior to the decline,
19:33
Speaker 3: and what you should do is buy.
19:36
Speaker 2: It's easier said than done. You mentioned covering behavioral finance
19:41
Speaker 2: as a way to look beyond just indexing funds. Tell
19:45
Speaker 2: us a little bit about the challenges that the average
19:48
Speaker 2: investor faces trying to buy into a down thirty percent
19:53
Speaker 2: market when everybody else is panicking and running the other way.
19:57
Speaker 3: Well, we know how investors behaved, which is they extrapolate
19:59
Speaker 3: recent returns. So if the market's going up, they think
20:01
Speaker 3: it's going to keep going up, it's going down, they
20:03
Speaker 3: assume it's going to keep going down, and that, of
20:06
Speaker 3: course is what everybody around them is doing. They're also
20:08
Speaker 3: extrapolating returns. It's very hard to step aside from the
20:12
Speaker 3: narrative of that time and think independently, but that's what
20:16
Speaker 3: you need to do to be a successful investor. At
20:19
Speaker 3: a bare minimum. At a bare minimum, if you can
20:22
Speaker 3: just stand your ground, you'll probably do a whole lot
20:25
Speaker 3: better than most investors who will tend to be buying
20:28
Speaker 3: and selling it just the wrong time.
20:29
Speaker 2: I just have to ask you a little bit about
20:31
Speaker 2: what you did after the Journal, and that includes both
20:35
Speaker 2: City Group and Humble Dollars. You were at City Group
20:38
Speaker 2: for about six years and you were director of education.
20:41
Speaker 2: Tell us a little bit about what that role encompassed
20:45
Speaker 2: and what it was like dealing with City investors rather
20:49
Speaker 2: than journal readers. And I'm sure there's a bit of
20:52
Speaker 2: an overlap there.
20:53
Speaker 3: So in a couple of years running up to early
20:55
Speaker 3: two thousand and eight, I was getting increasingly burned out
20:58
Speaker 3: on writing the column and I was thinking, like I
21:01
Speaker 3: got to do something else in life, and I cast around.
21:04
Speaker 3: I talked to various people about different jobs. Nothing quite
21:08
Speaker 3: rang a bell for me. And then I was approached
21:11
Speaker 3: by City Group about being director of financial education for
21:15
Speaker 3: this startup called ma FI. And the idea was they
21:19
Speaker 3: were going to help small investors with their entire financial
21:22
Speaker 3: life in return for a fixed monthly fee. That was
21:24
Speaker 3: the notion, lovely notion. But two things went wrong. One
21:29
Speaker 3: is The idea of doing a startup within a large
21:32
Speaker 3: corporation is absolutely absurd. Companies large companies are incapable of
21:37
Speaker 3: innovating in that way. It was just a struggle from
21:40
Speaker 3: day one, particularly in the rehdatory environment that is the
21:43
Speaker 3: securities business between lawyers and compliance people. Everythink was a headache.
21:48
Speaker 3: And then on top of that, of course, we ran
21:50
Speaker 3: straight into the two thousand and eight two thousand and
21:52
Speaker 3: nine Great Recession, So the business was pretty much dead
21:55
Speaker 3: before it began. And by the summer of two thousand
21:58
Speaker 3: and nine they'd pulled the plug on this venture and suddenly,
22:01
Speaker 3: you know, I've thrown away my journalism career to join
22:03
Speaker 3: the City Group. You know what would happen next, Well,
22:06
Speaker 3: this group of people that were part of this startup,
22:08
Speaker 3: well my FI, were rolled into the traditional bank based
22:12
Speaker 3: brokerage business, if you can imagine two completely different group
22:15
Speaker 3: of people. And then on top of that, they decided
22:18
Speaker 3: they were going to try to turn these bank based
22:21
Speaker 3: brokers into feelingly financial advisors.
22:24
Speaker 2: Which, by the way, was the underlying trends outside of
22:28
Speaker 2: the broker's firm. They were watching what was a small
22:32
Speaker 2: part of the business really begin to blossom post crisis.
22:37
Speaker 3: So I became part of this new business, and I
22:40
Speaker 3: did a lot of writing and a lot of public
22:43
Speaker 3: speaking over the next four plus years until I realized that,
22:48
Speaker 3: you know, I really wasn't doing much good in the world.
22:51
Speaker 3: I was collecting the nice paycheck, the biggest paycheck in
22:53
Speaker 3: my life, but I really felt like I was wasting
22:57
Speaker 3: my time, and I've I've never already done anything in
23:03
Speaker 3: my career solely for money, and it's suddenly dawn on
23:06
Speaker 3: me that really I was just living for my paycheck.
23:08
Speaker 3: So I made a plan to get out of there.
23:11
Speaker 3: I realized I had enough to retire if I wanted to.
23:13
Speaker 3: I was in my I was fifty one, so I
23:16
Speaker 3: spent ten or eleven months preparing to leave. I contacted
23:21
Speaker 3: the journal about writing for them again. I also started
23:25
Speaker 3: working on a book, and after I got my lost
23:28
Speaker 3: year in Bonus in early twenty fourteen, I walked in
23:31
Speaker 3: and handed in my notice.
23:34
Speaker 2: So you said something I have to follow up on.
23:36
Speaker 2: I can't tell you how many people have said, you know,
23:40
Speaker 2: I don't really do this for the money, and very
23:43
Speaker 2: often they get pushedback. But I feel that way, and
23:46
Speaker 2: I know you feel that way. What sort of response
23:49
Speaker 2: do you get from people when you say, well, I'm
23:51
Speaker 2: getting a nice paycheck, but that's not why I do this.
23:54
Speaker 3: I think that in this case, I probably did not
23:57
Speaker 3: express it to people in that way. I'm not saying
24:00
Speaker 3: that I don't like getting paid.
24:02
Speaker 2: But well, we all like getting paid. But my question
24:05
Speaker 2: is why do we do what we do. Is it
24:07
Speaker 2: for the money or is the money like a nice
24:10
Speaker 2: aspect of being able to do what you really love?
24:13
Speaker 3: And it's really the latter, And I think it probably
24:15
Speaker 3: depends on the economic comfort in which you grew up.
24:19
Speaker 3: I mean, I grew up in a very comfortable middle
24:21
Speaker 3: class or from middle class household, so money was never
24:25
Speaker 3: my priority going into the workforce. You know, I wanted
24:27
Speaker 3: to cover the costs obviously, I wanted to save for
24:30
Speaker 3: the future, but I was never motivated by money. If
24:32
Speaker 3: I was motivated by money, I would never have ended
24:34
Speaker 3: up in journalism.
24:36
Speaker 2: That's interesting, and you have said, especially post diagnosis, you've
24:42
Speaker 2: very publicly said, gee, had I known when when the
24:46
Speaker 2: clock was going to run out, I would have spent
24:48
Speaker 2: money more aggressively. It's kind of interesting that you were
24:52
Speaker 2: saving despite having come from a fairly comfortable background. Clarify
24:59
Speaker 2: that a little bit. How did you think about spending
25:01
Speaker 2: money and how did the diagnosis change your perspectives on this.
25:06
Speaker 3: So there are two reasons why I became very focused
25:09
Speaker 3: on saving money. First, what I call the great family story.
25:12
Speaker 3: So when my great great grandfather died in eighteen eighty eight,
25:17
Speaker 3: he was listening in the newspapers as one of the
25:20
Speaker 3: richest men in England.
25:21
Speaker 2: Really, I had no idea.
25:23
Speaker 4: That's fascinating.
25:23
Speaker 3: He he was based out of Liverpool and he and
25:27
Speaker 3: his brother had launched a cigarette company called Cope Cigarettes
25:31
Speaker 3: and they made a ton of money. That fortune ended
25:35
Speaker 3: up with my great grandmother, uh huh, and she lived
25:39
Speaker 3: the Downton Abbey lifestyle. She had an estate in the
25:42
Speaker 3: Cotswolds on which there were five mansions. She lived in
25:45
Speaker 3: one and her various children lived in the other houses
25:49
Speaker 3: on the estate. The estate was inherited by the kids
25:54
Speaker 3: to a person. They blew the money in short order.
25:57
Speaker 2: Classic three generations shirtsleeves to shirts life.
26:00
Speaker 3: So I grew up with that great family story about
26:02
Speaker 3: how you shouldn't you know, waste money, how you should
26:05
Speaker 3: think about the future. And then added to that was
26:09
Speaker 3: when I got out of college and I got into
26:11
Speaker 3: the workforce. I ended up getting married and having kids
26:15
Speaker 3: really quickly. I was a father at age twenty five,
26:18
Speaker 3: supporting a graduate student wife and living in New York
26:21
Speaker 3: City and tight.
26:22
Speaker 4: Money's a little tight.
26:23
Speaker 3: Yeah, you know, ordering a pizza on a Friday night
26:26
Speaker 3: was a questionable decision. And you know, I learned to
26:29
Speaker 3: be super careful with money, and that continued for probably
26:34
Speaker 3: thirty years. It's really on the last five years that
26:36
Speaker 3: I've become happier about spending money, eating out more often,
26:42
Speaker 3: traveling more. And of course since my diagnosis, you know,
26:45
Speaker 3: I've been doing even more of that. I mean, I
26:48
Speaker 3: still want to make sure that my kids and my
26:50
Speaker 3: wife inherit plenty of money, but I'm at the point where, Okay,
26:53
Speaker 3: I don't need to stay for the future anymore because
26:55
Speaker 3: there isn't much future left for me. So we've been
26:58
Speaker 3: traveling more. But to come back to the question you're
27:02
Speaker 3: going to ask me, which is do I regret my
27:04
Speaker 3: earlier frugality. Not really, because what I would say to you, Barry,
27:08
Speaker 3: is one sure way that money buys happiness is by
27:14
Speaker 3: allowing you not to worry about money. And so I
27:17
Speaker 3: have not worried about money for years.
27:20
Speaker 2: And to be fair, you know, I don't want to
27:22
Speaker 2: engage in what anti Duke calls resulting when you you know,
27:26
Speaker 2: all of us are born not knowing how long we
27:29
Speaker 2: have and when you get an end date, when you
27:33
Speaker 2: know when the game is going to end, well, now
27:36
Speaker 2: you have that information, it's not fair to go back
27:38
Speaker 2: and say, hey, twenty years ago, had you known, what
27:41
Speaker 2: would you've done differently, Because at the time you don't know,
27:45
Speaker 2: it's impossible to go back and revisit those decisions. The question, really,
27:50
Speaker 2: the fairer question, is the advice you would offer people
27:54
Speaker 2: who don't know what the end date is. How much
27:57
Speaker 2: should they be saving, how much should they be occasionally
28:01
Speaker 2: taking money out and enjoying it? And obviously it's all
28:04
Speaker 2: a function of specifics, but how has your perspective changed,
28:08
Speaker 2: if at all, when you're giving that sort of advice
28:10
Speaker 2: to people.
28:12
Speaker 3: So, first of all, I'd say to you, Barry, one
28:14
Speaker 3: of the things that's the greatest source of happiness to
28:16
Speaker 3: me is just the day to day. Just getting up
28:19
Speaker 3: in the morning, having a cup of coffee, sitting at
28:22
Speaker 3: my laptop writing in edit, seeing you know, going out
28:25
Speaker 3: for lunch, having a glass of wine in the evening
28:27
Speaker 3: with Lane. These are not expensive things for me. A
28:31
Speaker 3: happy life does not cost a whole lot of money. Yes,
28:34
Speaker 3: you know, we all are doing more traveling now, and
28:37
Speaker 3: you know we are traveling first class or business class,
28:40
Speaker 3: which I wouldn't have done a couple of years ago.
28:42
Speaker 3: So yeah, I'm spending more freely. But the real happiness
28:46
Speaker 3: I get is basically doing what I've always done, which
28:49
Speaker 3: is to do work that I think is important. That
28:53
Speaker 3: is a big source of happiness for me, And not
28:55
Speaker 3: only does it not cost very much, but it actually
28:57
Speaker 3: owns me some money. So up. The other thing I
29:00
Speaker 3: would say to people is you do not want to
29:02
Speaker 3: do all of this too early on. You know, if
29:05
Speaker 3: I had flown business cross regularly in my twenties, it
29:07
Speaker 3: would not be special to be today. Having a gradually
29:11
Speaker 3: rising standard living throughout your life is a wonderful thing.
29:16
Speaker 3: You know. If you stayed at Motel six in your twenties,
29:21
Speaker 3: staying at HIGHTT in your sixties seems pretty special, right.
29:24
Speaker 4: That's really interesting.
29:25
Speaker 2: So let's talk a little bit about Humble Dollar. When
29:28
Speaker 2: did you set that up? And you're still you're still
29:32
Speaker 2: running that and publishing yourself with a group of other
29:35
Speaker 2: people tell us a little bit about the humble Dollar.
29:38
Speaker 3: So Humble Dollar was launched right at the end of
29:39
Speaker 3: two thousand and sixteen. I used it essentially to take
29:43
Speaker 3: a annually updated financial guide that I was producing, and
29:47
Speaker 3: I decide just to throw it on the web and
29:49
Speaker 3: make it freely available and run some mads against it.
29:52
Speaker 3: And as part of that, I invited a few people
29:55
Speaker 3: to start writing for the site. And that snowballed over time,
29:59
Speaker 3: and I have, you know, probably fifty or sixty people
30:03
Speaker 3: who write occasionally for the site. They all do it
30:07
Speaker 3: for free. They're all amateur writers. And the thing I
30:11
Speaker 3: say to these amateur writers is, you know, you know,
30:14
Speaker 3: you may not be financial experts, but you are experts
30:17
Speaker 3: on your own life. So I encourage them to write
30:20
Speaker 3: about their own financial lives. And the result has been
30:25
Speaker 3: that people engage in a level of financial disclosure about
30:29
Speaker 3: what they've done with their own money that the readership
30:32
Speaker 3: finds fascinating, they find liberating, and it's become to my surprise,
30:38
Speaker 3: I mean, this is not what I set out to do.
30:40
Speaker 3: It's become a place where people happily talk about their
30:42
Speaker 3: own finances, and the readership tends to be very supportive.
30:47
Speaker 3: I do carefully moderate comments. I mean, if I feel
30:51
Speaker 3: like people are getting too rough on somebody, I'll delete comments.
30:54
Speaker 3: I also steer people away from the endless political commentary
30:57
Speaker 3: that's poisoned social media and it's becomes I like to
31:03
Speaker 3: take a safe place for people to talk about their
31:04
Speaker 3: own finances.
31:05
Speaker 2: I think that's the right approach. I mean, I had
31:08
Speaker 2: a comment section on the blog on the Big Picture
31:11
Speaker 2: for I don't know, close to ten years and literally
31:14
Speaker 2: millions of comments, and at a certain point, really post
31:17
Speaker 2: financial crisis, it kind of began going off the rails
31:22
Speaker 2: and I did the same thing you did. It's like, hey,
31:24
Speaker 2: this is not a political forum, and if you're gonna
31:27
Speaker 2: just really be you know, it takes so much time
31:30
Speaker 2: and effort for someone to write something, and it's so
31:32
Speaker 2: easy to just dismiss it. It doesn't seem fair, and
31:36
Speaker 2: I think your approach is the right way to go.
31:39
Speaker 2: Is I don't know what sort of pushback you get
31:42
Speaker 2: to it from the readers. But the other thing I
31:44
Speaker 2: wanted to ask you about that, not just the other
31:47
Speaker 2: writers on the Humble Dollar, but the comments is people
31:51
Speaker 2: are kind of weird about money sometimes people are just
31:55
Speaker 2: like it's perplexing how some people think about money or
31:58
Speaker 2: use money. Tell us a little bit about your experiences
32:02
Speaker 2: dealing with the public and trying to be sort of
32:05
Speaker 2: calm and rational when consumerism and materialism very often isn't.
32:11
Speaker 3: So. I'm not sure I have a clear view on
32:14
Speaker 3: how the typical American thinks about money these days. You know,
32:17
Speaker 3: what I have is a realtively narrow audience, somewhat older,
32:23
Speaker 3: more affluent. They tend to have been drawn to the
32:26
Speaker 3: site because they followed me for a number of years.
32:28
Speaker 3: A lot of them are indexers. Most of them are
32:32
Speaker 3: great savers, and the biggest issue for them is not
32:36
Speaker 3: saving more and delay and gratification even more, but learning
32:39
Speaker 3: how to spend in retirement. I mean, that is the
32:41
Speaker 3: biggest struggle. Obviously, not a struggle for most Americans. People
32:45
Speaker 3: do have peculiarities about money. You know this as well
32:47
Speaker 3: as I do. It varies enormously, so it's hard to generalize. Right.
32:51
Speaker 3: Probably most people are naturally inclined to spend too much
32:54
Speaker 3: and to save too little. But in terms of my audience,
32:57
Speaker 3: their inclination is to spend too little and save too much.
33:00
Speaker 2: Let's talk about that because we have about thirty advisors
33:03
Speaker 2: who are cfps that work in my shop, and one
33:07
Speaker 2: of the common conversations is I have a client. He's
33:11
Speaker 2: got millions of dollars invested. We can't get him to
33:14
Speaker 2: spend money. He wants to buy a vacation property, he
33:18
Speaker 2: can't pull the trigger. They want to take the family
33:20
Speaker 2: on a European trip, and he thinks it's going to
33:22
Speaker 2: cost too much. How do you help people who were
33:26
Speaker 2: earners and savers pivot in their fifty sixties seventies to
33:31
Speaker 2: becoming spenders.
33:33
Speaker 3: I think that pushing people to spend more is unlikely
33:37
Speaker 3: to work. I think instead you should talk about other goals.
33:41
Speaker 3: I mean, do you want to stop giving money to
33:43
Speaker 3: your kids? Do you want to start giving money to charity?
33:45
Speaker 3: Think of other ways to get them to let go
33:48
Speaker 3: of some of their dollars, and maybe that doorway will
33:52
Speaker 3: become the doorway to start spending more on themselves. Suddenly,
33:57
Speaker 3: I've changed up the last five years. Five years ago,
34:00
Speaker 3: pre pandemic, I was very careful about spending. I didn't
34:02
Speaker 3: go out to eat a lot, didn't spend a lot
34:05
Speaker 3: on travel, And I think one of the things that
34:08
Speaker 3: for me coming out of the pandemic was a willingness
34:11
Speaker 3: to spend more to God and enjoy life more after
34:13
Speaker 3: that long period stuck at home. And of course my
34:17
Speaker 3: diagnosis has done that even more. And not only I
34:20
Speaker 3: have I've been spending more, I've also been giving more
34:22
Speaker 3: to my kids, to charity and so on. So I
34:25
Speaker 3: think if you could open the door a little bit
34:28
Speaker 3: and people get comfortable with it, then they'll spend more.
34:31
Speaker 3: And giving away money, whether to charity or to your children,
34:34
Speaker 3: is a way of opening that door.
34:36
Speaker 2: So I don't know if this is my perspective or
34:40
Speaker 2: if this is accurate or not. I kind of recall
34:45
Speaker 2: prior generations the wealth was passed down out of the
34:50
Speaker 2: estate after the person passed away.
34:52
Speaker 4: They would leave their money to their family.
34:54
Speaker 2: It seems like it's a little more modern concept is
34:57
Speaker 2: why not give them the money one you can watch
35:00
Speaker 2: them enjoy it, buy a house, travel whatever. Is that
35:04
Speaker 2: a skewed perspective or do you see something similar?
35:07
Speaker 3: No, absolutely, people definitely seem to be happier to give
35:10
Speaker 3: away money now. And it's not simply that you get
35:13
Speaker 3: the pleasure of seeing your kids enjoy the money. You
35:16
Speaker 3: can also guide how they use it. I actually just
35:20
Speaker 3: wrote checks at the beginning of the year to both
35:22
Speaker 3: my kids, and you know, my kids asked, well, what
35:24
Speaker 3: should I do with the money? So it's a chance
35:26
Speaker 3: to say, yeah, you know, you want to put it
35:29
Speaker 3: into your retirement account, you want to put it into
35:31
Speaker 3: your emergency fund, you want to use it to pay
35:33
Speaker 3: down the mortgage. The other thing, of course, is that
35:36
Speaker 3: you get to see them enjoy it, right, And they
35:41
Speaker 3: are at the point where, you know, if I give
35:43
Speaker 3: my kids nineteen thousand dollars this year under the gift
35:46
Speaker 3: tax exclusion, which is the sum you can give without
35:49
Speaker 3: how finding a gift tax return, that money to them
35:53
Speaker 3: in their thirties is so much more valuable than it
35:56
Speaker 3: is to me in my sixties, right right. I mean,
35:59
Speaker 3: they're at a point where they're still under a fair
36:00
Speaker 3: amount of financial stress. And I'm not saying that's a
36:03
Speaker 3: bad thing. I meanial stress, yeah exactly. That's how you
36:07
Speaker 3: learn good spending habits. But you also get a lot
36:11
Speaker 3: of pleasure from getting a nineteen thousand dollars check from
36:13
Speaker 3: your father.
36:14
Speaker 2: So a theme that we seem to be talking about
36:17
Speaker 2: is things that have changed. People are giving money away
36:20
Speaker 2: sooner rather than as part of the estate. We've talked
36:23
Speaker 2: about the shift from active mutual funds to passive ETFs.
36:28
Speaker 2: What other significant shifts have you observed over the course
36:32
Speaker 2: of your career.
36:33
Speaker 3: So we did touch on this as well, which is
36:35
Speaker 3: what is considered financial journalism has changed. It used to
36:38
Speaker 3: be that everybody was solely focused on investing and solely
36:42
Speaker 3: focused on beating the market. I mean, that was the discussion,
36:46
Speaker 3: you know, day in day out, and to some extent
36:49
Speaker 3: it still is in the financial media, but you know,
36:54
Speaker 3: the playing field is widened. So we are talking about
36:57
Speaker 3: things in what I consider PUSS finance, home ownership, social security,
37:03
Speaker 3: tax management, state planning, and so on. We're also talking
37:06
Speaker 3: about how money meets life, things like behavioral finance, things
37:10
Speaker 3: like money and happiness. And I think the next big
37:16
Speaker 3: focus within personal finance is trying to bring this down
37:20
Speaker 3: to the individual level, not just making you know, broad
37:23
Speaker 3: generalizations about you know, investors have this behavioral bias or
37:28
Speaker 3: that behavioral bias. Not talking in generality is about how
37:31
Speaker 3: you can use money to boost happiness. But you, as
37:36
Speaker 3: an individual, you know what sort of individual are you?
37:38
Speaker 3: Are you a savior, are you a spender? You know
37:41
Speaker 3: what is it from your past that is triggering you.
37:44
Speaker 3: I think that in the years ahead, we will start
37:46
Speaker 3: focusing more on that and that will lead to even
37:51
Speaker 3: more interesting conversations about money as people get to know
37:54
Speaker 3: themselves better and that works into how they manage their money.
37:58
Speaker 2: So let's talk a little bit about your announcement. Last year,
38:03
Speaker 2: you received a stage four lung cancer diagnosis. You're a
38:08
Speaker 2: non smoker, so this is the genetic variation of the disease.
38:12
Speaker 2: Tell us a little bit about that diagnosis and what
38:18
Speaker 2: motivated you to share it so publicly.
38:21
Speaker 3: So back in May of last year, Barry, I started
38:24
Speaker 3: having balance issues and I thought I might have an
38:28
Speaker 3: ear infection. I couldn't figure out quite what was going on,
38:32
Speaker 3: so I on a Sunday decided to go to an
38:36
Speaker 3: urgent care clinic and the doctor told me that the
38:39
Speaker 3: urgent care clinic must have realized something that was going
38:43
Speaker 3: on that you know, was obviously I was missing. So
38:46
Speaker 3: I got dispatched the emergency room and the next thing
38:49
Speaker 3: you know, I was stuck in the stroke victim really
38:53
Speaker 3: ward at at a hospital in Philadelphia. So it was
38:58
Speaker 3: sixteen beds up there, guys who are intbated, plus me
39:01
Speaker 3: sitting on the edge of my bed, like what am
39:03
Speaker 3: I doing here? So after some scans, some MRIs, they
39:08
Speaker 3: realized that I had not had a minor stroke. Instead
39:12
Speaker 3: I had cancer. They found ten lesions on my brain
39:17
Speaker 3: and a gulf ball size growth on my lungs, and
39:21
Speaker 3: after some some genetic testing and so on, they discovered
39:27
Speaker 3: that I had a relatively rare form of cancer that
39:30
Speaker 3: tends to flick people of Asian origin and women, called
39:34
Speaker 3: eachfr exon twenty and it's a relatively aggressive cancer. The
39:39
Speaker 3: median life expectancy for people who have each gfr x
39:43
Speaker 3: on twenty is sixteen months. So by the time I
39:46
Speaker 3: got into see the ecologist, she suggested I might have
39:49
Speaker 3: a year to live, and that was in June of
39:52
Speaker 3: twenty twenty four. Since then, I've had a couple more
39:55
Speaker 3: lesions on my brain and the cancer has also spread
40:00
Speaker 3: my spine. In both cases, the the cancer my spine
40:05
Speaker 3: was dealt with with radiation, similarly to the new lesions
40:08
Speaker 3: on my brain. I've also had recently had a to
40:12
Speaker 3: hour procedure to shore up my spine because of the
40:14
Speaker 3: damage done by the cancer. Otherwise there's a risk I
40:18
Speaker 3: was going to fracture my spine. So as of today,
40:22
Speaker 3: I'm feeling okay. But you know, the cancer is you know,
40:25
Speaker 3: isn't my blood. It's likely to crop up somewhere else.
40:28
Speaker 3: I think I'm gonna beat the one year mark that
40:30
Speaker 3: I was given. I'm hoping I'll make it through twenty
40:33
Speaker 3: twenty five, but you know, realistically, it's unlikely that I'm
40:37
Speaker 3: gonna make it much beyond them, though of course I
40:41
Speaker 3: would love it. I mean, I have to say this, Barry. Yeah,
40:44
Speaker 3: I love every day and I want every moment I
40:50
Speaker 3: can get, But you have to be a realistic and
40:53
Speaker 3: you know, this is stage four cancer. There is no recovery.
40:57
Speaker 3: You know, it's just a matter of trying to control
40:59
Speaker 3: the cancer. And do I have the good fortune that
41:03
Speaker 3: came into this in reasonably good physical shape. So I've
41:07
Speaker 3: coped with the treatment fairly well. You know, I'm having
41:11
Speaker 3: chemo immunotherapy every three weeks, taking countless medications. You know,
41:16
Speaker 3: I've had these radiation treatments. As I said, I just
41:19
Speaker 3: had my back operated on in order to shore it up.
41:23
Speaker 3: But you know, at some point, you know, cancer is
41:26
Speaker 3: gonna win. I just don't know when. So come back
41:30
Speaker 3: to answer the question that you asked, So, Yeah, after
41:32
Speaker 3: I got the diagnosis, I wrote about it on my
41:36
Speaker 3: website and you know, put out the word on social media,
41:40
Speaker 3: and the response to me was quite surprising. I mean,
41:44
Speaker 3: not only did I get, you know, an outpouring of
41:46
Speaker 3: love heard from people I hadn't heard from in years,
41:49
Speaker 3: readers have shown a lot of love that People also said,
41:53
Speaker 3: you know, you're so brave for sharing your diagnosis. I
41:57
Speaker 3: was like, brave. I've spent my entire life writing about
41:59
Speaker 3: my own fine answers. Why would I Why would I
42:02
Speaker 3: stop now? And you know, is it that people don't
42:06
Speaker 3: talk about this stuff because of denial? Is it because
42:10
Speaker 3: you know, they're just they're embarrassed? Is it because fear
42:14
Speaker 3: of death? I don't know, but it seems like the
42:16
Speaker 3: most natural thing in the world to write about it,
42:18
Speaker 3: And to my surprise, I seem to have done a
42:21
Speaker 3: fair amount of good by doing so. People really appreciate
42:24
Speaker 3: somebody talking openly about what it is, what it's like
42:27
Speaker 3: to have a terminal diagnosis. I would also say to
42:31
Speaker 3: you that a short life expectancy, this notion that your
42:36
Speaker 3: life is finite. I mean, of course that's true for
42:38
Speaker 3: all of us, right, but it really does make you
42:44
Speaker 3: focus on the day to day. I mean, when I,
42:47
Speaker 3: you know, get up in the morning, I really noticed
42:49
Speaker 3: the taste of the coffee. When I take a walk,
42:51
Speaker 3: I really notice how beautiful the trees are, how lovely
42:54
Speaker 3: the sky is. It really does focus the mind. And
42:58
Speaker 3: if anything, because I know the time is finite, I'm
43:01
Speaker 3: joined the day to day even more. It's strange, but
43:05
Speaker 3: it's true. And I would say to people, you know,
43:07
Speaker 3: even if you don't have a terminal diagnosis, you know,
43:11
Speaker 3: try to be sort of more purposeful and more mindful
43:14
Speaker 3: about each day because you will get greater happiness out
43:17
Speaker 3: of each day.
43:18
Speaker 2: Well, that that's really good advice. You wrote a Wall
43:21
Speaker 2: Street Journal piece some final personal finance advice, and some
43:27
Speaker 2: of the things you discussed were really, I don't want
43:31
Speaker 2: to say funny, but just the way you phrase them,
43:34
Speaker 2: we're so blunt and matter of fact, it was really intriguing.
43:37
Speaker 2: Let me run through a few of these, and I'd
43:40
Speaker 2: like to get your your thoughts on it. The first
43:43
Speaker 2: one that leapt off the page was death is hard
43:46
Speaker 2: work explain.
43:49
Speaker 3: So I've always had my finances pretty well organized, but
43:53
Speaker 3: until you know that you're about to pop off, you
43:56
Speaker 3: realize how much, sorry to use the phrase, how much
44:00
Speaker 3: crap you've accumulated, and you realize how hard it will
44:04
Speaker 3: be for your family to figure out your finances. So
44:07
Speaker 3: in the weeks and months that followed, I've done all
44:12
Speaker 3: kinds of things. I got a new will, powers of attorney.
44:16
Speaker 3: I closed accounts so that there is there are fewer
44:20
Speaker 3: accounts for my.
44:21
Speaker 2: Everything was consolidated in one place.
44:23
Speaker 3: They were already consolidated. But for instance, I had a
44:26
Speaker 3: a wroth for one K, and it's like, I'm I'm
44:28
Speaker 3: not gonna I'm not gonna fund this anymore, so I'm
44:30
Speaker 3: going to close it and roll it into my regular IRA.
44:33
Speaker 3: I had an inherited diarray from my father. It didn't
44:36
Speaker 3: have very much in it, so I closed that out.
44:38
Speaker 3: But also downe in the basement, I had a box
44:42
Speaker 3: of papers, a couple of boxes of papers. Some of
44:45
Speaker 3: them went back to when I was in college. It's like,
44:48
Speaker 3: what I had every Christmas card from nineteen eighty six?
44:50
Speaker 3: Why do I need every Christmas card from nineteen eighty six?
44:53
Speaker 3: So I just started trashing all of this stuff. And
44:55
Speaker 3: you carry around this stuff for decades, one day you're
45:00
Speaker 3: gonna look at it. Well, this was my moment to
45:02
Speaker 3: look at it, and you know what I didn't. I
45:05
Speaker 3: just started sticking in the recycling bind. So there was
45:09
Speaker 3: a lot of work to be done in order to
45:11
Speaker 3: simplify things for my for my wife and for my kids.
45:15
Speaker 3: And I still have more work to do. So I
45:17
Speaker 3: all the utilities are currently in my name, and in
45:21
Speaker 3: the weeks ahead, one of the final things I want
45:23
Speaker 3: to do is to make sure that I move you know,
45:25
Speaker 3: the internet, the cell phones, the gas, the water, the
45:29
Speaker 3: electricity olint Elane's name, so that this one less thing
45:32
Speaker 3: for her to do after I'm gone.
45:33
Speaker 4: Huh, really really very thoughtful.
45:35
Speaker 2: The other thing that really leapt off the page was
45:38
Speaker 2: so much talking.
45:41
Speaker 3: So two days after my diagnosis, both my kids were
45:44
Speaker 3: in town and was in town. I sat them down.
45:48
Speaker 3: I explained my estate plan, and of course all this
45:51
Speaker 3: was obvious to me. You know, while there's this traditional iray,
45:54
Speaker 3: there are these roth iro rays, the regular taxable accounts,
45:58
Speaker 3: there's you know this account that yeah, and they're looking
46:02
Speaker 3: at me like like during the headlights, like what is
46:04
Speaker 3: all this about? And it's when I realized that the
46:07
Speaker 3: stuff that's second nature to me isn't second nature to
46:09
Speaker 3: my kids. So had an hour discussion then and so
46:13
Speaker 3: many discussions since then as I've tried to explain, you
46:17
Speaker 3: know why you should not spend the roth ira until
46:20
Speaker 3: the end of the ten year period, but you'll have
46:22
Speaker 3: to draw down the traditional ira over time because there's
46:24
Speaker 3: going to be taxable income on top of your income.
46:27
Speaker 3: Lots of stuff like that. That second nature to me,
46:31
Speaker 3: just wasn't clear to them.
46:32
Speaker 2: And the last thing was simply taxing matters. How I'm
46:37
Speaker 2: assuming your state is not going to be in the
46:40
Speaker 2: taxable size, So what do you discuss with your wife
46:44
Speaker 2: and kids about taxes?
46:47
Speaker 3: So my kids will be subject to the Pennsylvania inheritance
46:51
Speaker 3: tax four and a half percent, and so you know,
46:55
Speaker 3: that's why I've started to distribute money to them now.
47:00
Speaker 3: I had written a private mortgage for my daughter. It
47:05
Speaker 3: was currently a little over three hundred thousand dollars, and
47:08
Speaker 3: I forgave that loan and then adjusted how much she's
47:11
Speaker 3: going to get versus how much my son is going
47:13
Speaker 3: to get. And as long as I make it through
47:15
Speaker 3: to July past the one year mark, then Hannah won't
47:20
Speaker 3: have to pay the inheritance tax on that money.
47:22
Speaker 2: It becomes part of the estate and it's non taxable
47:24
Speaker 2: at that point.
47:25
Speaker 3: Well, it's not part of the estate at all, so
47:27
Speaker 3: she won't have you know, she won't have to pay
47:29
Speaker 3: the inheritance tax on that three hundred thousand dollars. Okay,
47:33
Speaker 3: So there are a variety of things like that that
47:34
Speaker 3: you know, I've done in order to make things a
47:36
Speaker 3: little less taxing. For my kids. It's also why as
47:39
Speaker 3: soon as January one past this year, that's why I
47:41
Speaker 3: made them a gift for twenty twenty five. Similarly, for
47:46
Speaker 3: my grandchildren, you know, I funded their five twenty nine
47:50
Speaker 3: plans early in the year so that I can get
47:52
Speaker 3: that money, you know, out of my estate and hopefully
47:56
Speaker 3: I'll make it past the one year mark, so it's
47:57
Speaker 3: not subject to the inheritance tax.
47:59
Speaker 4: Really really intriguing.
48:02
Speaker 2: So given you your diagnosis, has your perspectives on money
48:07
Speaker 2: and happiness at all changed? How have you thought about
48:11
Speaker 2: some of your previous philosophies and views.
48:15
Speaker 3: I think one of the things that makes me happy
48:18
Speaker 3: through this period is not even that I don't have
48:20
Speaker 3: to worry about money. With everything else that's going on,
48:22
Speaker 3: money is not a worry. So when I go back
48:24
Speaker 3: to the twenties and thirties, and the sacrifices I made,
48:27
Speaker 3: I'm glad I made them so that I have that
48:30
Speaker 3: financial security today, so that amid everything else that's going on,
48:34
Speaker 3: money is not something that's top of mind for me.
48:38
Speaker 3: Truth is, I haven't really worried about money for years,
48:41
Speaker 3: but you know, it would be terrible to be faced
48:44
Speaker 3: with huge medical costs potentially and not have the finances
48:48
Speaker 3: to cover it. I've also, however, you know, thought about
48:53
Speaker 3: you know, this is my retirement, right. If I don't
48:56
Speaker 3: enjoy my retirement now such as it is, I'm never
48:58
Speaker 3: gonna enjoy. So yeah, I have been spending more freely.
49:01
Speaker 3: You know. We went to London recently, we went to Ireland.
49:07
Speaker 3: I took the family on a fairly luxurious long weekend.
49:13
Speaker 3: This month, we're going to Paris. We've got other trips
49:16
Speaker 3: planned in the months ahead. There's a limit how far
49:18
Speaker 3: I can plan ahead because I never know where and
49:20
Speaker 3: I'm going to get derailed by some bad diagnosis and
49:23
Speaker 3: I hate the idea of the cancelation fees. But you know,
49:27
Speaker 3: we do have trips planned, and we've booked the hotels,
49:30
Speaker 3: but I haven't booked the flights because I don't have
49:33
Speaker 3: to cancel them.
49:33
Speaker 4: Huh.
49:34
Speaker 2: So, So we talked earlier about money and happiness. I'm
49:39
Speaker 2: curious as to how you think about the relationship between
49:43
Speaker 2: life satisfaction, well being, and what money does.
49:48
Speaker 4: And does not help you obtain.
49:51
Speaker 3: So money, I believe can do three things for you. One,
49:55
Speaker 3: it can allow you not to worry about money. We've
49:57
Speaker 3: talked about this already in many ways. You know, money
50:00
Speaker 3: doesn't buy happiness. It lets you avoid unhappines it's the
50:03
Speaker 3: unhappiness of being broke. But two, money can buy you
50:07
Speaker 3: the financial freedom spend your days doing what you love.
50:11
Speaker 3: If you love your job, that's great, that's the greatest
50:14
Speaker 3: combination get. But a lot of people clearly don't love
50:16
Speaker 3: their jobs. So what they want is the financial freedom
50:19
Speaker 3: to do whatever it is they wished to be able
50:21
Speaker 3: to do. And you get that by saving diligently a
50:24
Speaker 3: year after year, decade after decade. And then third, money
50:28
Speaker 3: can allow you to have special times with friends and
50:30
Speaker 3: family and you know, whether it's you know, the barbecue,
50:34
Speaker 3: the special vacation, flying across the country to see the grandchildren,
50:38
Speaker 3: whatever it is, money can allow you to do that.
50:40
Speaker 3: So those three things, avoiding on the unhappiness of being broke.
50:45
Speaker 3: Two doing whatever you think is fulfilling, and three is
50:49
Speaker 3: spending special times with friends and family. That's what money
50:52
Speaker 3: can do for you. That is the way that money
50:54
Speaker 3: can buy happiness.
50:55
Speaker 2: Huh, very intriguing. So you've mentioned a lot of your
51:00
Speaker 2: earlier in life financial decisions have set you up in
51:07
Speaker 2: a good financial situation today. What what decisions do you
51:11
Speaker 2: look back and say, oh, I'm really glad I did that.
51:14
Speaker 2: What were the with hindsight, with the benefit of hindsight,
51:18
Speaker 2: what were the choices you made that you most appreciate today.
51:23
Speaker 3: Probably like everybody you know, Barry who has you know,
51:27
Speaker 3: mass and wealth on their own, The smartest thing I
51:30
Speaker 3: ever did was to be a good saver. You know,
51:32
Speaker 3: if you know, if you're a good saver, you know
51:35
Speaker 3: everything else is, everything's going to turn out fine. Even
51:38
Speaker 3: if you're not a great investor. As long as you're
51:40
Speaker 3: a good saver, you know, good things will happen. If
51:44
Speaker 3: you're a lousy saver, but a great investor, you know,
51:47
Speaker 3: it's unlikely that you're going to succeed financially. So yeah,
51:51
Speaker 3: saving with the number one thing, and then too, I
51:53
Speaker 3: was very early as you might imagine on the indexing train,
51:55
Speaker 3: and that has also rebounded to my benefit. But it's
51:58
Speaker 3: it's been a saver that was not the list.
52:01
Speaker 2: So so let me flip that question around. What do
52:04
Speaker 2: you think most people get wrong? What are some of
52:06
Speaker 2: the biggest myths in investing in finance that we often
52:11
Speaker 2: have a hard time getting passed?
52:13
Speaker 3: Well, suddenly, you know, this focus on investing, this focusing
52:15
Speaker 3: on beating the market is the wrong place to you know,
52:19
Speaker 3: be spending your time. But let me let me broaden
52:21
Speaker 3: it out, Barry, So something that I've been thinking about
52:24
Speaker 3: a lot of late, which is most people, and this
52:30
Speaker 3: was true of me in the early days, spend too
52:32
Speaker 3: much time worrying in general and worrying about money specifically.
52:38
Speaker 3: And I think this is hardwired into us. You know,
52:40
Speaker 3: we are here because our hunter gather ancestors survived. And
52:44
Speaker 3: why did they survive Because they were worriers, right, They
52:48
Speaker 3: worried about everything, you know, they wanted to make sure
52:51
Speaker 3: that they were going to be okay no matter what happened. Well,
52:53
Speaker 3: guess what, you know, the sabretooth tiger is not going
52:56
Speaker 3: to leap out of the bushes. We do not need
52:59
Speaker 3: to worry the way our ancestors used to. And yet
53:03
Speaker 3: people worry constantly. I mean, people are serial warriors. It's
53:09
Speaker 3: like the hedonic treadmill. We talk about how, you know,
53:12
Speaker 3: we strive towards goals, hoping that they're gonna make us
53:14
Speaker 3: happy forever, and then boom, we achieve whatever it is,
53:18
Speaker 3: and we immediately saw us driving off to something else.
53:20
Speaker 3: We can't get off that treadmill. But there's also a
53:22
Speaker 3: worry treadmill, and we worry about something blah blah bah
53:25
Speaker 3: bah bah. Choose away from us. The worry goes away.
53:28
Speaker 3: We're onto something else. People cannot escape their worries. And
53:33
Speaker 3: what I would want for listeners and I want for
53:37
Speaker 3: my reader is is please find some way to worry less.
53:41
Speaker 3: Because if you do the right stuff financially, you live
53:45
Speaker 3: bene your means, you're not crazy with your investments. Hopefully
53:50
Speaker 3: you index, you know, hopefully you don't take on too
53:53
Speaker 3: much debt. You know you're not gonna get it all right,
53:56
Speaker 3: but good things will happen in the end. You don't
53:59
Speaker 3: have to spend thirty forty years worrying about retirement. You
54:03
Speaker 3: don't have to get to retirement and worry that you're
54:05
Speaker 3: spending a crazy amount of money because you're going to
54:07
Speaker 3: get derailed by the stock market or whatever it is.
54:10
Speaker 3: Things are likely to walk out just fine. We are
54:13
Speaker 3: not you know, back you know in you know, like
54:18
Speaker 3: our hunter gather ancestors, you know, worried about every threat.
54:22
Speaker 3: You know, it's it's time to like go of those worries.
54:25
Speaker 3: That to me is the biggest mistake people make. And
54:29
Speaker 3: I don't have a magic cure for getting away from
54:31
Speaker 3: those worries, but I do believe that is the number
54:34
Speaker 3: one thing we could do for our own happiness.
54:36
Speaker 2: Huh really really very interesting. Of all the things you've
54:41
Speaker 2: learned over the course of being a personal finance columnist
54:46
Speaker 2: first for Forbes and for the journal and everything you've
54:50
Speaker 2: done at the Humble Dollar, aside from worry less, what
54:55
Speaker 2: do you think is the most important piece of financial
54:58
Speaker 2: wisdom that you want to pass along that you want
55:01
Speaker 2: to have outlive you What what's the most significant thing
55:04
Speaker 2: you wish people would embrace then it would make their
55:07
Speaker 2: life better.
55:09
Speaker 3: I think what people need to do is know themselves
55:12
Speaker 3: right much more than you know, what's the expensive issue
55:15
Speaker 3: on their index funds or you know, which is the
55:18
Speaker 3: best age of which claim social security. Know yourself, because
55:21
Speaker 3: everybody has different financial needs and different financial worries and
55:25
Speaker 3: so on. So if you customize your finances to your
55:29
Speaker 3: own needs, not to somebody else's needs, not to what
55:32
Speaker 3: your brother in law says, not to what you heard
55:35
Speaker 3: on the TV. If you focus it to your own needs,
55:37
Speaker 3: what you worry about the most, that is likely to
55:43
Speaker 3: lead you to have a happier financial life. I think
55:46
Speaker 3: one of the problems is that we live too much
55:48
Speaker 3: under the influence of others. It's not just the influence
55:51
Speaker 3: of people today. You know, our friends and family and
55:54
Speaker 3: the people we see in the media, but also we
55:57
Speaker 3: live under the influence of the past, what our parents
56:00
Speaker 3: told us or what they modeled for us. People go
56:04
Speaker 3: through their life buying what their parents bought because they
56:06
Speaker 3: thought it made their parents happy, and so they think
56:08
Speaker 3: it's gonna make them happy. Probably not gonna work out
56:11
Speaker 3: that way. So try to think for yourself and try
56:13
Speaker 3: to know yourself.
56:15
Speaker 2: Good good advice. Let me throw you a curveball. I
56:18
Speaker 2: remember last summer, towards the end of July, you were
56:22
Speaker 2: the focus of a New York Times piece headline a
56:26
Speaker 2: money guru bit big on a very long life. Then
56:29
Speaker 2: he got cancer. You're usually the author of pieces like that.
56:35
Speaker 3: How odd was it to.
56:37
Speaker 2: Be the subject of a piece I know you as
56:40
Speaker 2: a humble person, not just because of the Humble Dollar website.
56:44
Speaker 2: You're not seeking to be the center of attention. How
56:48
Speaker 2: strange was that entire experience?
56:51
Speaker 3: Well, Barry, to be honest, sitting here getting quizzed by
56:54
Speaker 3: you is not that difficult from different from getting quizzed
56:57
Speaker 3: by Ron Lieber at the New York Times. But that's it. Yes, Yeah,
57:02
Speaker 3: I personally do not want to be the center of attention.
57:04
Speaker 3: I would like the focus to be on my writing
57:06
Speaker 3: rather than me as a person. But you know, I
57:10
Speaker 3: knew Ron was not gonna be unkind. I've known Ron
57:12
Speaker 3: for decades. He's a friend of mine. Much more on
57:17
Speaker 3: couple actually was the photo shoot where I have to
57:19
Speaker 3: sit there and try to smile for now. But it
57:24
Speaker 3: sort of goes back to what I was talked about
57:26
Speaker 3: earlier about the amount of publicity that my diagnosis has generated.
57:31
Speaker 3: I mean, since that came out, you know, I had
57:34
Speaker 3: the Wall Street Journal article that I wrote, I had,
57:36
Speaker 3: I wrote a piece for the Washington Post. I've got
57:38
Speaker 3: a piece coming out in the ARP magazine. Ron Lieber
57:42
Speaker 3: wrote that piece for The New York Times. I also
57:45
Speaker 3: wrote a piece for my father's old paper in London,
57:47
Speaker 3: the Telegraph, which was a lot of fun. Well maybe
57:50
Speaker 3: not fun, but it was great to be in there.
57:53
Speaker 3: So Yeah, the focus on my diagnosis is a little
57:57
Speaker 3: bit odd and Cerddainly, it's uncomfortable for me to be
58:00
Speaker 3: the folks of attention wrong on my writing. But I
58:03
Speaker 3: feel in some way in a way that I didn't
58:06
Speaker 3: really realize that it's it's it's doing some good and
58:12
Speaker 3: being of service to others has always been really important
58:15
Speaker 3: to me. I mean, I feel like if I'm not
58:17
Speaker 3: doing some little good in the world, I'm I'm not
58:21
Speaker 3: spending my days usefully. I never want to spend the
58:26
Speaker 3: days focused solely on my own needs.
58:28
Speaker 2: But you were able to use the opportunity to amplify
58:32
Speaker 2: the good message that you had for people, which was, hey,
58:36
Speaker 2: here's just a fundamentally smart way to go about managing
58:39
Speaker 2: not just your investing but your personal finance and your life.
58:44
Speaker 2: That focus must have been gratifying to get that message out.
58:48
Speaker 3: No, absolutely it was, but it was also a little
58:52
Speaker 3: bit uncomfortable.
58:53
Speaker 2: Yeah, I can, I can certainly see. Knowing you and
58:56
Speaker 2: knowing your personality, I can see it was something like,
58:59
Speaker 2: all right, let me uh, let me make this trade
59:01
Speaker 2: off and and but it all seems to have accomplished
59:05
Speaker 2: the goal of spreading what you wanted to share with
59:08
Speaker 2: the public.
59:09
Speaker 3: And you know, for as long as I am able,
59:11
Speaker 3: you know, I want to be able to continue writing.
59:14
Speaker 3: I do have a whole bunch of articles that I
59:17
Speaker 3: still hope to pen. But you know, I know this,
59:20
Speaker 3: this ride is gonna it's going to come to an end,
59:23
Speaker 3: probably sooner than I would like. But you know, for
59:27
Speaker 3: now what I can still write, well, I can still
59:29
Speaker 3: get my fingers on the keyboard. I hope to keep
59:32
Speaker 3: punching out a few more articles.
59:33
Speaker 2: So normally at this point I shift to some of
59:37
Speaker 2: the favorite questions I ask all of my guests.
59:40
Speaker 4: I'm not sure how relevant.
59:41
Speaker 2: These are, but but let's uh, let's run through them
59:45
Speaker 2: for posterity stake. What's keeping you entertained these days? What
59:50
Speaker 2: are you doing if you just want to kick back
59:51
Speaker 2: and relax a little bit.
59:53
Speaker 3: Yeah, that's not a thing. I'm very good at kicking
59:57
Speaker 3: back and relaxing. That said, as I mentioned, if I'm
1:00:01
Speaker 3: gonna be retired, which I don't think I'll ever be
1:00:04
Speaker 3: fully retired. This is the moment, right. If I don't
1:00:06
Speaker 3: do it now, I'm never gonna get to do it.
1:00:08
Speaker 3: And for the first time, probably twenty years, I actually
1:00:13
Speaker 3: started watching sports again on TV HM and it sort
1:00:18
Speaker 3: of takes me back to being a teenager and so on,
1:00:20
Speaker 3: sitting on the couch. I'm not sure I could ever
1:00:24
Speaker 3: sit through a whole football game, but maybe I could
1:00:25
Speaker 3: watch the final quarter, and so I've been trying a
1:00:28
Speaker 3: little bit of that.
1:00:29
Speaker 2: So, yeah, have you played with red zone at all?
1:00:32
Speaker 4: No? My nephews are just crazy about it.
1:00:35
Speaker 2: It's just the highlights of every big game kind of
1:00:39
Speaker 2: all at once. It's just it's an amazing If you're
1:00:43
Speaker 2: a football fan, you might want to explore that. It's
1:00:45
Speaker 2: pretty bonkers.
1:00:46
Speaker 3: So I live down in Philadelphia, So the Eagles are
1:00:50
Speaker 3: an obsession. Yeah, and you can't help but catch a
1:00:54
Speaker 3: little bit of the fever. On a Sunday afternoon, half
1:00:58
Speaker 3: the people and this is not actuation, half the people
1:01:01
Speaker 3: you see walking on the street are wearing Eagles gear.
1:01:04
Speaker 4: Wow.
1:01:04
Speaker 3: I mean, that's how much of an obsession it is
1:01:06
Speaker 3: in the city. And it's fun. You know. I've been
1:01:11
Speaker 3: taught by my son in law that when you go
1:01:12
Speaker 3: into a store in Philadelphia, you know, to buy something
1:01:15
Speaker 3: on a Sunday, what you have to say when you
1:01:17
Speaker 3: leave is go birds.
1:01:21
Speaker 4: That's very funny.
1:01:22
Speaker 2: Tell us about your mentors who helped shape your career.
1:01:26
Speaker 3: So I would call out one person, which was the
1:01:28
Speaker 3: editor of this little newspaper that I worked for when
1:01:32
Speaker 3: I was nineteen. Her name was Leslie Levin, and she
1:01:34
Speaker 3: had just got out of the American University Journalism school,
1:01:39
Speaker 3: and she had all of this knowledge about journalism that
1:01:44
Speaker 3: she was anxious to pass on, and literally she taught
1:01:48
Speaker 3: me how to write, she taught me how to report.
1:01:50
Speaker 3: It was a great experience. I was so fortunate. And
1:01:56
Speaker 3: in fact, this was all before I went to college,
1:01:58
Speaker 3: and I took the advice that she gave me about,
1:02:02
Speaker 3: you know, how to run a small newspaper, and then
1:02:04
Speaker 3: I took it and I used it when I edited
1:02:05
Speaker 3: the student newspaper at Cambridge, and I've used it ever since.
1:02:10
Speaker 3: So if I ever, for instance, see a piece of
1:02:13
Speaker 3: copy with an exclamation mark on it, immediately here Leslie's
1:02:16
Speaker 3: voice in my back my head, saying, you only ever
1:02:19
Speaker 3: used the exclamation mark if it's World War III, otherwise
1:02:22
Speaker 3: no exclamation marks.
1:02:25
Speaker 2: That's really interesting. Tell us about some of your favorite books.
1:02:28
Speaker 4: What have you been reading recently.
1:02:30
Speaker 3: Lately? I've been doing a lot of reading about Philadelphia
1:02:33
Speaker 3: and about the neighborhood where I live. I live very
1:02:38
Speaker 3: close to the School River, across from the Pence the
1:02:41
Speaker 3: Penn U Penn campus and where I live now used
1:02:47
Speaker 3: to be full of Irish immigrants who worked on the
1:02:49
Speaker 3: wolves along the schookel and next to me is a
1:02:55
Speaker 3: very an elderly lady. I think she's probably in her nineties,
1:02:57
Speaker 3: and her son lives with her, and he's in his
1:03:00
Speaker 3: mid sixties. And Charlie tells me that when he was
1:03:03
Speaker 3: growing up in the neighborhood there were two Italian families
1:03:07
Speaker 3: and everybody else was Irish. And the fact that he
1:03:10
Speaker 3: was aware that there were only two families in the
1:03:13
Speaker 3: neighborhood who were Italian and everybody else was Irish tells
1:03:16
Speaker 3: you something about that neighborhood at the time. So I
1:03:19
Speaker 3: enjoyed reading about Philadelphia. But in terms of favorite books,
1:03:24
Speaker 3: the best time in terms of learning about finance was
1:03:30
Speaker 3: when I was at Forbes in the late nineteen eighties.
1:03:33
Speaker 3: Back then, the workplace was less pressured. There's less drive
1:03:37
Speaker 3: to produce, and there was more time to sort of sit,
1:03:39
Speaker 3: kick back and relax and read. And Forbes had a
1:03:42
Speaker 3: great library. So back in those days, you know, I
1:03:45
Speaker 3: read Burton Malkiel's ran Walk Down Wall Street. I read
1:03:49
Speaker 3: all the books of Wall Street history by John Brooks,
1:03:54
Speaker 3: and I picked to remember.
1:03:55
Speaker 2: Once upon a Time in Galanda's that the Go Go
1:03:58
Speaker 2: years right.
1:04:00
Speaker 3: And then there was this little book that I discovered
1:04:02
Speaker 3: in the Forbes library called Investment Policy by Charles Ellis.
1:04:07
Speaker 3: And Investment Policy, I believe, came out in nineteen eighty six,
1:04:11
Speaker 3: and I think the original edition was ninety four pages,
1:04:16
Speaker 3: and it just seemed like Charlie went through and picked
1:04:18
Speaker 3: out every word in that book with enormous care. Since then,
1:04:23
Speaker 3: the book has ballooned a little bit. It's over two
1:04:24
Speaker 3: hundred pages. But that and it's now of course called
1:04:28
Speaker 3: Winning the Losers Game. That's right.
1:04:29
Speaker 2: That in fact, that began life as a research paper.
1:04:35
Speaker 2: I don't remember if it was the CFA Institute, but
1:04:38
Speaker 2: it was published.
1:04:38
Speaker 3: Somewhere I think with the General of Portfolio manage.
1:04:41
Speaker 2: I think that's exactly right. But it was a short
1:04:43
Speaker 2: twenty thirty page thing which has persisted.
1:04:47
Speaker 4: Winning the Losers.
1:04:48
Speaker 2: Game is one of my favorite finance books. And you
1:04:51
Speaker 2: know he Charlie has a new book coming out this year.
1:04:53
Speaker 3: Yep, Charlie's Unstoppable. Yes, if you can find Charlie's original book,
1:05:01
Speaker 3: Investment Policy, which is the one that I believe came
1:05:03
Speaker 3: out in eighty six, you know, it's ninety four pages,
1:05:06
Speaker 3: it's a great read, and that I think was probably
1:05:10
Speaker 3: the most influential book on investing that I've ever read.
1:05:12
Speaker 2: Wow, that's a that's a big deal. I'm gonna have
1:05:14
Speaker 2: to hunt that down. I may have to reactivate my
1:05:17
Speaker 2: eBay account to get that. Our final two questions, what
1:05:22
Speaker 2: sort of advice would you give to a recent college
1:05:25
Speaker 2: grad interest in the career in financial journalism or investment?
1:05:30
Speaker 3: Well, so, I think I already obnsered the financial journalism one,
1:05:32
Speaker 3: which is don't do it. I'm not a tilly serious.
1:05:36
Speaker 3: I mean, journalism is the most fun you can have
1:05:39
Speaker 3: while keeping your clothes on. I mean it's you know,
1:05:41
Speaker 3: newsrooms are great places to be. You know, you will
1:05:45
Speaker 3: never meet a group of people who are more fun
1:05:49
Speaker 3: to be with and more cynical. I mean it's just
1:05:52
Speaker 3: so much fun to be in a newsroom. So yeah,
1:05:55
Speaker 3: go and be a journalist for a couple of years,
1:05:56
Speaker 3: learn how to write, learn about the world, and then
1:05:58
Speaker 3: go and make do something will make you some money.
1:06:00
Speaker 3: But spending a couple of years in journalism in your
1:06:04
Speaker 3: twenties when you don't really need to worry about making
1:06:06
Speaker 3: a lot of money is a great thing to do.
1:06:08
Speaker 3: So yeah, I would encourage people to do it, but
1:06:10
Speaker 3: don't imagine you're gonna make a career out of it.
1:06:12
Speaker 2: And our final question, what do you know about the
1:06:14
Speaker 2: world of investing today? You wish you knew thirty years
1:06:18
Speaker 2: or so ago.
1:06:19
Speaker 3: That's an interesting question. Why do I wish I knew?
1:06:23
Speaker 3: I guess what I wish I knew was to was
1:06:26
Speaker 3: that if I did the right things for long enough,
1:06:29
Speaker 3: everything was going to work out just fine. If you know,
1:06:32
Speaker 3: as long as I say, as long as I didn't
1:06:35
Speaker 3: fiddle around too much on my portfolio, if I just
1:06:37
Speaker 3: let it ride, you know, I could just go off
1:06:40
Speaker 3: and worry about other stuff, not worry about it at all.
1:06:44
Speaker 3: You know, things generally do work out today. You know,
1:06:47
Speaker 3: there are not many people you know who go into
1:06:50
Speaker 3: the world, out into the world, and you know are
1:06:52
Speaker 3: reasonably prudent and managing money and soon who don't successfully
1:06:56
Speaker 3: get to retirement. You don't need to fret about it
1:06:59
Speaker 3: every step of the way. You don't need to analyze
1:07:01
Speaker 3: every month spending in quicka and you don't need to
1:07:05
Speaker 3: find tune your portfolio every month. Just you know, set
1:07:08
Speaker 3: up a sensible acid allocation, buy some index funds saved regularly,
1:07:12
Speaker 3: and good things will happen.
1:07:14
Speaker 2: Jonathan, thank you so much for being so generous with
1:07:17
Speaker 2: your time and your incredibly insightful advice. We have been
1:07:23
Speaker 2: speaking with Jonathan Clements. He is the author of numerous
1:07:27
Speaker 2: finance books that you can find at your favorite bookseller,
1:07:30
Speaker 2: as well as the Humble Dollar blog. If you enjoy
1:07:34
Speaker 2: this conversation, well, check out any of the five hundred
1:07:37
Speaker 2: or so we've had over the past ten years. You
1:07:40
Speaker 2: can find those at iTunes, Spotify, YouTube, wherever you find
1:07:44
Speaker 2: your favorite podcast, and check out my new book, How
1:07:48
Speaker 2: Not to Invest The bad ideas, numbers, and behavior that
1:07:53
Speaker 2: destroys wealth and how to avoid them. I would be
1:07:56
Speaker 2: remiss if I did not thank the Cracked team that
1:07:58
Speaker 2: helps me put these conversations together each week. My audio
1:08:02
Speaker 2: engineer is John Wasserman. Anna Luke is my producer. Sean
1:08:06
Speaker 2: Russo is my researcher. Sage Bauman is the head of
1:08:09
Speaker 2: podcasts at Bloomberg. I'm Barry Ritolts. You've been listening to
1:08:14
Speaker 2: Masters in Business on Bloomberg Radio.