VO (00:00):
You are listening to the Tony Steuer podcast, where Tony interviews financial literacy advocates who are changing the conversation on money, so you can catch up on the latest trends and ideas in the world of financial literacy and education.
Tony (00:18):
Welcome to the Tony Steuer Podcast. I'm pleased to be joined today by Elliott Appel. Elliott is the founder of Kindness Financial Planning. In this episode, we'll be discussing how to get people to talk about money. Elliott, welcome to the podcast.
Elliott (00:34):
Thanks, Tony. I appreciate you having me.
Tony (00:36):
Yeah, thanks for joining us today. So, you know, as we get started, this is where I always like to get started at the beginning, you know, tell us a little bit about what is your origin story? How did you get started in financial education?
Elliott (00:49):
Yeah, so I went through sort of the process of elimination through college of the different areas of life that you might wanna major in, and ended up taking a finance course and just falling in love with it, which didn't come too big of a surprise for me just because my uncle did get me started investing when I was younger. And I really enjoyed that. But there was something about going through the process of those different courses and then ended up with an internship at a major brokerage company. Ended up loving that, but didn't love the sales side of that, and having the different products or services that you could pitch, saw the registered investment side of the business and just fell in love with it. Being able to work with people and really provide your time and your expertise and knowledge as opposed to certain products and being able to offer that with the coordination of financial planning and insurance and investments and tax planning and bringing it all together for people. So that's, that's the short version of it.
Tony (01:43):
Well, fantastic. Yeah, and that's great. Is I, I think people go through that discovery process as they get into personal finance. And it's interesting because, you know, you've been doing this for a while, you have your own podcast, is, you know, people come into it from very different ways, so there's not just one path.
Elliott (02:00):
Yes. And I, I was very lucky. I mean, I landed at a registered investment advisor right outta college and worked for them up until the time that I launched my own firm about a year ago. And so I, I feel very fortunate because I know a lot of people do bounce around and see different sides of the industry more so than I did.
Tony (02:15):
Yeah, definitely. And I, and I hear the same thing. I mean, there, there's, you know, it's a, it's a tricky issue with the brokers and the commission based products. You know, it's like, I I I think each has their place. I, I don't know. What do you think?
Elliott (02:29):
Yeah, no, I absolutely think there is a place for almost everything that exists in financial services today. I'll put sort of an asterisk there cause I think there's a few things that probably shouldn't exist. But yeah, I think it depends on what a consumer's looking for, right? There's a place for an insurance agent, there's a place for a broker, there's a place for a financial planner. It, it just depends on what, what method someone is looking for, even within the financial planner space, whether they're looking for a short engagement or an ongoing engagement, right? There, people want different things. Just like there's different products out there, there's different services that, that exist for consumers.
Tony (03:01):
Yeah, no, that, that's a great point. And, and, and you know, I I, I mean we could probably do a whole episode on this, is that I'm not sure the financial services industry does a great job of educating consumers on those things and matching, you know, your, what you're looking for, you know, versus the type of planners that there are. And people oftentimes then get frustrated in their relationship because it's not Yeah. And they don't even know the questions to ask, you know, to choose their advisor.
Elliott (03:31):
Yes, agree. A hundred percent. It's, it is very confusing, I think, for consumers out there to distinguish the different methods of services and the different jargon we have.
Tony (03:41):
Yeah. I, I know , I don't know if you followed Michael Kitsis, but he talks a lot about the different levels of advice and everything and you know, so it's, it's interesting. So, you know, this to switch gears, you know, one of the things that I, I really appreciated and which led me to reach out to you is, you know, that you talk about the emotional side of money. So how do you feel that you can connect the emotional and economic sides of money?
Elliott (04:07):
Yeah, so Tony, sometimes they don't, and sometimes that's okay. The way I like to frame it with clients is that it, there's really two sides to every decision. And sometimes there's a, there's a spectrum, right? You have the economic side and you have the emotional side. And, you know, let's go through a very simple example, cash approaching retirement or even paying down a mortgage decision. But I'll, I'll do the cash approaching retirement. Cause I work with a lot of retirees. You know, you can go off a general rule of thumb and say, economically, you really don't need more than maybe three or six months worth of cash and for living expenses on hand at any given time. I think most people would agree with that. It's a general world thumb out there, but there's a span of retirees that have anywhere from, you know, zero months to, you know, probably up to five years or longer for the amount of cash that's on hand.
Elliott (04:55):
And, you know, there are some risk and sort of return trade-offs with that decision that we won't go into detail with. But, you know, when I've talked to people, particularly people approaching retirement for the, the first time they're transitioning to it, they're not quite there. Having a little extra cash for a lot of folks feels better emotionally that that is a good thing, right? They're, they, they know exactly where their spending's gonna come from for the first two years, and that can provide a lot of peace of mind. Now, economically, probably not the best decision in most market environments, but for those people to be able to sleep better at night, to have that peace of mind that's worth the return, it's worth giving up that. And, and that's why I say it's connecting the two. And sometimes it's a disconnect and a lot of people sometimes have a gut decision that they feel strongly one way or the other about a certain decision. And in that case, the emotional side of that is gonna outweigh any of the economic stuff. And that's okay. And other times maybe there's a trade off that they're willing to go more towards the economic side. So I'll pause there for a second.
Tony (05:56):
Well then No, that's awesome. I, I think that's really putting the personal and personal finance is, you know, what's, and I think people oftentimes miss that is, is that I think you do make a very good point is that it's what does a person want to accomplish? But also what makes them comfortable is, I like having a larger emergency fund. I know it's more than I need to have in cash, cash equivalent, but you know what, for me it, it, it works. Yeah. But I wouldn't recommend necessarily to a, a client that they have as much cash, you know, but
Elliott (06:32):
Exactly. And
Tony (06:34):
Yeah, I'm sorry.
Elliott (06:35):
I was just gonna say, and it's just talking through the, the trade offs of that decision and being comfortable with that and recognizing that here are the pros and cons of this decision, here are the pros and cons of this decision. And, and I'm okay with that. And I, I think that's the great thing is you can help someone come to that conclusion after getting to know them. Because we don't, we don't live in spreadsheets. I can show you the best economic decision, but it may not mean anything to you going through that experience if it doesn't feel good.
Tony (07:04):
Yeah. So, so what's your experience? Do you feel that your clients tend to stick with the recommendation better when they've really buy into that emotional side of it?
Elliott (07:12):
Oh, absolutely. I mean, when you can go through the process and get to know someone and figure out what, what is actually important to them and what, what are they concerned about? What, what are the types of things down the road that may throw the plan off track emotionally, right? If X, Y, Z happens and we don't have x, you know, A, B, C in place that could potentially wreck their retirement or throw their retirement off plans or, you know, whatever the decision is, if, if they have really bought into the decision. And more so that they've made the decision for themselves, not me telling them, here's my recommendation, it's let's get to this recommendation together.
Tony (07:52):
Yeah. I I I was gonna say my experience as well is that clients tend to, I, if they come to the realization, then they truly have a buy-in and they tend to stick with whatever the recommendation is, instead of going a year later, you know, like, Hey, I, I, I need to change this, or I don't remember why I did this and , you know, then it's like, it doesn't work for anyone. So that's a great point. So I, I think one of the points you bring up, you know, leads into our next question is, you know, how can people go through a major health event and then figure out what comes next? You know, h how did they make that transition when something does happen?
Elliott (08:31):
Yeah, I mean, that's an excellent question and I think one we're all figuring out is people get older and you have people caring for parents, and parents are figuring out their own health and what they're doing. But I, you know, I'll just talk personally some resources that have been helpful in my life and, you know, major health events that I've experienced with my dad is, you know, getting palliative care involved really early. I, I think a lot of people associate palliative care care with hospice and they're very different. And being able to talk through with a doctor of what, what are possible resources given my illness and given whatever path I'm on or whatever the, the typical one is, right? You know, no one knows what their health experience is gonna be like, but what is the average progression for whatever this illness is and what resources are available and what would be helpful now, but also potentially later.
Elliott (09:19):
I also think consulting with an elder care consultant, depending on your resources and what you have available in your community, they can be invaluable. Just helping set up a transition to a different living facility or getting resources in the home and making you aware of what local resources are available in your city. Cuz each county's a little bit different than what they have available, either for free or for paid, and what's out there. But I also think just being open to things changing and coming back to these conversations regularly with your family and talking about it, I think that's been the biggest thing to help determine sort of what comes next. Cuz no one really knows what comes next. It's more of we can put a plan in place. Life's probably gonna destroy that plan, and then how do we adjust going forward?
Tony (10:06):
Yeah, yeah. Which, what's a man plans? God laughs or something I think is the same
Elliott (10:11):
. Yeah. Something like that.
Tony (10:14):
So it seems to sum it up, but I, I think two of the things that you're saying are really important that it's about communication and research. Yeah. You know, that there's always tho those basic blocks, you know, with everything is to, you know, find out your options, talk about it, and learn and ask questions and be curious. Yeah. You know, so it's, I I think that's great. If advice, you know, so as you go through this, you know, h how does a family maintain control and why is it important for families to take control of their lives, not let them spiral out of control?
Elliott (10:49):
Yeah, so I'm a big fan of life planning. I went through the training last year, if anybody's familiar with George Kinder and the Kinder Institute. But they've gotten excellent training for just different ways of approaching financial planning. And I like this because it starts with the person before you ever get to the finances. And this, this will loop back to your question, but, you know, in terms of taking control, I almost feel like a lot of people need to take maybe eight steps back before they start from whatever point they are to go forward. Because I don't think a lot of people spend time thinking about what they, they truly want from life. I mean, how often do people sit down and actually talk to their family about, you know, let's consciously make a decision about like what we're doing this year, what we're doing the next five years, the 10 years, and again, we can make the best laid plans.
Elliott (11:34):
They may not work out, but if you don't have a, a vision for what you want or what an ideal life would be for you, I think it's gonna be really challenging to get control because there's not really a, a purpose there for you mm-hmm. . And so I think it's taken a few steps back. I, you know, I'm a big fan of life planning, so doing some of that work or just, you know, asking broader questions about what you want going forward to then be able to move forward on a more solid or stable foundation, I think is the way that you gain control of that.
Tony (12:06):
Right. I, I, I think that's excellent advice because it's so easy to get caught up in the minutia or the little things. You know, like my big thing's always been, you know, like lately Bitcoin is, you know, people start the conversation with like, should I buy Bitcoin or not? And I don't think that's the right question. I think the question is, can Bitcoin help you meet your goals that you've already set in, in your picker plan? And I, and I think, but that's a change for the industry, like you said, is you, one of your first jobs was at a brokerage where you're pushing a product like, Hey, you've got this mutual fund and like, how many of your clients need this mutual fund and ? So
Elliott (12:47):
Exactly. And it, it's one of those things that it's tough to do. I'm, I'm guilty of it. I'm, I'm one of those people who give me the, those facts or the story and let's, let's go forward, let's just move from that point. And, you know, I have to remind myself consciously for my own life and, and in client's lives of, let's, let's pause for a second, , let's reflect on what's happening here. Maybe take a few steps back and then, then potentially move forward
Tony (13:11):
Now that, that's great advice. I, I'm with you. So, you know, as part of that you also talk about, you know, creating an ideal life. How does someone create an ideal life for themselves?
Elliott (13:21):
Again, I, I'd go back to the life planning, life planning has some exercises or inspirational work that you can go through to do that. And a lot of it is question and answer. And with that, being able to do it with another person and a professional who's trained in this to, to really leave the space to have those conversations. I mean, how often do people actually sit in silence after a question and just sort of think about it, right? Even that space right there was probably a little awkward for us and for any listeners listening and imagine that longer and be able to actually think and reflect on the question that's being asked to then move forward. But I, I'm a big fan of questions. If people therapy I think is also a good thing for a lot of people out there. And just talking more about money, I think the more we talk about something, the easier it is to, to figure out what we want to do and how, how to create that ideal life. Whereas if we're shying away from it, it's, I mean, if you're not talking about it, how, how are you ever going to get there?
Tony (14:25):
Yeah. Exactly. Because you can't plan for something that you're not even thinking about. And oftentimes, you know, it's, it's a, it's a very blanket like, okay, are you saving enough money for retirement? But what does that really mean? Because, you know, probably even just you and I that, that our retirement plans are probably different. What represents a perfect retirement for you and what represents the perfect retirement for me? And I, I think people miss that.
Elliott (14:51):
Yeah. I think the other thing, Tony, is trying it out. So whatever it is you want to do, and I think a perfect example is someone who's worked really hard in their career and they don't go to part-time, but instantly retire one day, well, one day you're working full-time the next day you don't know what to do with your time. And I've seen that be very challenging for people whose identity has been tied up in their work. And so I think if you can move to part-time or do some consulting or you know, sort of try out a mini retirement, take a sabbatical, that sort of thing, just to see what it is you like to do. Are there things you can retire too that's helpful or, you know, I've had clients want to move somewhere, well maybe go move there for a month, rent out a place for a month or two, see what it's like to live as a local. Do you actually want to live there? Is that an ideal place for you? So I think some trial and error is helpful before you go full in on an idea.
Tony (15:43):
Yeah, no, I I I I love that. I, I hadn't really thought about that, you know, with retirement, but you know, when I think about people who've retired, I do know that some people have struggled with that transition because like all of a sudden, you know, it's like they work 40 hours a week, 60 hours a week, and then all of a sudden, you know, it's like, you know, and a lot of those people go back to work after a year or two.
Elliott (16:06):
Yeah.
Tony (16:07):
Because cuz they didn't really plan out. And, and, you know, I was commenting on something today on a post that you know, about college loans and that, you know, oftentimes in the decision making process, people talk about financially friendly colleges at the end of the conversation, you know, where you're focused on the academics and you focus on this and that, rather than talking about the money upfront. And I think that's a thing that ideal life is like, okay, well if you go to the college of your dreams, then you know, you may be carrying a lot of student debt mm-hmm. for years, that's gonna impact the rest of your life. And, yeah. Now I I I love this whole life planning. You know, so, so with that, you know, can you share a little bit more about, you know, what is a life planner and what, what does that entail? What's, what's different?
Elliott (17:02):
Yeah. I, I think it's so hard to define and I, I wish some trainers were here from the Kinder Institute because it'd be such, such a better job of defining it. But I, you know, I would, I would describe the process more so than what they are. But I, I, you know, I think the saying goes, it's, it's financial planning done right. And, you know, basically you're going through a series of at least three meetings before you ever get to the investments. So high level overview, you're just having an exploration meeting of mm-hmm. what's important to you and putting everything on the table. So it's not really narrowing it down to these are the three things that are important to me. It's just what are all the things that are important to you? And then the second meeting is more about vision. So narrowing down what are the most important or essential elements of your life.
Elliott (17:49):
So taking it, you know, really 50,000 foot level and let's get it a little bit narrower to these are the things that are really meaningful to me that I, I need to have in my life to have that ideal life. And then from there you go to an obstacles meeting, which is one of my favorites because it's the question what could possibly get in the way? So knowing how important it is to get this vision, what could get in the way? Because I think naturally, and I think myself and others, we tend to go to the negatives first of like, oh, this is a problem, this is a problem, this is why I can't do that. And, and we just create these ideas, real or perceived of what could get in the way. And what I really like about this meeting is it's putting it back, I don't know, putting it backs the right language, but putting it in the client's hands to come up with solutions.
Elliott (18:33):
So it's not me as the financial planner saying, here's what you need to do. It's talking through and asking the right questions and helping a guide to come to their own solutions. What's amazing about it is people come up with some really unique and amazing solutions that I, I would personally never think of cuz it's, again, it's not my life, it's not my ideal life. I'm not trying to come up with solutions for it. It's them and them having the buy-in for that. So it's starting with those three meetings and having those conversations to figure out what's important, again, creating the space for it and then moving to the financial planning and then the investments and going through, I would say more of the traditional financial planning and investment management after that point, after you've gotten to know someone after they've hopefully helped discover what is that ideal life that they're trying to create and connecting that money back to those important things.
Tony (19:23):
Yeah. And, and and I agree completely. I I think that's where you can, you know, we can really change the way, you know, people are dealing with their finances because, you know, it's not like cuz investment allocation, it's super important, but it's not really important to our clients. I I I mean it is and it's not. Yeah. But that's not what they're trying to solve. You know, you know, you may have few people who are focused and you know, want to talk about that immediately, but really people are trying to say, you know, like, like we've been talking about, it's like I wanna live my dream retirement. And I think our job as a planner, I I, I wasn't a financial planner. I as an insurance consultant, two financial planners, you know, so I help financial planners design the thing. But you know, you're really trying to say, okay, well what's the best thing that's gonna benefit my client? H how, how is, you know, how are what we do, how are what we're doing? Is that, you know, really benefiting the client? Or is that just, are we drowning them in details that are unnecessary or jumping to those two quickly?
Elliott (20:31):
Yeah, I mean, you put it perfectly earlier that no one, no one really cares about their asset allocation. They care what that asset allocation can do for them. Can they,
Elliott (20:41):
Can they retire from work early? Can they do consulting? Can they put their kids through college, you know, all those bigger questions that are more important than, you know, my 60% stocks and 40% bonds or some other allocation. Most people don't care about that.
Tony (20:55):
Yeah. Yeah. There there's few do, but it's pretty minor. So, you know, I don't know if you're following the college for financial planning and that they've put in that, I think I said a psychology component. Have you been following that?
Elliott (21:08):
I know they did. But I don't know much about it at this point.
Tony (21:13):
Okay. Yeah, I don't either so we can, we shouldn't talk about it.
Elliott (21:17):
I took my CFP studies a long time ago, so I I haven't stayed as up to date on it.
Tony (21:23):
Yeah, no, I, I know they've added something, you know, so it's, it's coming as part of the conversation, you know, so financial therapy, you know, there's, there's a growing movement to, to bring that together and, you know, I mean George Kinder, you know, he's been doing this I think for 20 years or something. I I I know it's been around, he's had it for quite a while. Yeah. With the registered life planner,
Elliott (21:47):
He was almost, I feel like before his time in, in a way, cuz he is been doing it a long time and advocating for this. But I feel like it's only in the past few years starting to gain a little more traction.
Tony (21:58):
Yeah. I I I think as people started really making that connection because, you know, I've been in the business for a long time and it was very product driven and, you know, I started in the 1980s and, you know, very product driven and, you know, no look, mutual funds for the new kid on the block . And uh, you know, that was a whole different way of looking at things. Yeah. You know, so seeing that whole battle. So, you know, a as we wrap up is, you know, can you share with us what is your number one tip on financial wellness?
Elliott (22:31):
Number one tip on financial wellness? I think just don't be afraid to get into the weeds and ask questions that may seem foolish, cuz I don't think there are foolish questions out there when it comes to money. I think the, the lack of conversations that we're having and sort of the, the scarcity around money conversations is what drives a lot of the problems. So, you know, talk to family, talk to friends, make it a little uncomfortable and obviously ask permission, Hey, do you wanna have a conversation about money? But I think the wellness part is going to come from normalizing conversations around money and talking about salaries and talking about spending and not just the perceived things that we see going on in other people's lives, but what they're actually doing. So I I always try to have conversations and when I'd say I'm a financial planner, people are more akin to opening up and talking about money, which is exciting cuz I can tell they haven't had these conversations in their lives.
Tony (23:33):
Yeah, no, and and that's interesting is because, you know, we, we read all the statistics and you know, about how many people don't have an emergency fund or this or that, but when you actually talk to people, they're thinking about different things. Yeah. You know, that's not the first question outta their mind is like, Hey, you know, can you help me set up an emergency fund , you know? Exactly. While it might be a basic task on the list that that's not what people are thinking, and I love what you said is, you know, the foolish questions, there really isn't a, well, the only foolish questions in my mind are the questions that you don't ask. Yeah. That's, that's a foolish question. And, but we're intimidated to ask questions about our money and to open up because, you know, we don't wanna, you know, admit that we don't know something or we feel like, you know, like, Hey, I should, I should be on top of this or, and the financial service industry, I don't know if you feel it this way, but you know, that, that it sort of talks down to people in a way.
Tony (24:32):
Yeah. It's unfortunately constantly telling people what they've done wrong. Like, you haven't saved enough money for retirement, or your investments aren't set up correctly. And then people are like, God, I don't wanna hear everything that I've done wrong. You know, tell me something I've done. Right. Yeah. What, what am I doing? Well, . So yeah. Fantastic.
Elliott (24:53):
Our industry historically has not done a great job of that. And I, I think it depends on where you end up and who you're with. And I think that's why it's important to surround yourself with people who lift you up and those conversations.
Tony (25:05):
Yeah. I think that's great advice to surround yourself with people who lift you up. So, you know, Elliott, where can people learn more about you? Where can they follow you? Where can they stay in touch with you?
Elliott (25:16):
Yeah, so my firm website, kindness Financial Planning, l l c is KindnessFP is in financial planning.com. Can also find me on Twitter, Elliott M Appel a p p e l. And then I've also got a Facebook for my firm, but I'm most active on Twitter. And then my blogging and then my podcast making the most of time.com. You can find it on all the major podcast players.
Tony (25:40):
Fantastic. And, and for everybody watching and listening, I'll be posting links as usual to all of the things that Elliott mentioned so you can find him and follow him on Twitter and check out the good work he's doing. Elliott, thanks again for joining me today. It's been a pleasure.
Elliott (25:56):
Thank you, Tony. I really enjoyed the conversation
Tony (26:00):
And to everybody tuning in, thanks again for watching or listening to the Tony Steuer Podcast. Until next time.
