10 Popular Financial Strategies: Overrated or Underrated? – Episode #518

We’re constantly bombarded with information about how to improve our financial well-being—there seems to be no shortage of ways to get ahead financially. While many sound great in theory, do they really measure up when put into practice? On this episode of the Dentist Money Show, Matt and Victoria talk about 10 popular financial strategies that they believe are overrated, underrated, or rightly rated.

 

 

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Podcast Transcript

Victoria Ferguson:
Hey Matt.

Matt Mulcock:
Hello, here we are. Um, excited to be here, Victoria. How are you?

Victoria Ferguson:
I’m doing so well. I’m going to Austin, Texas tomorrow to escape the cold and the gloominess.

Matt Mulcock:
Do you want to share with the people why you’re going to Austin? And are you really escaping the gloominess? Cause isn’t the weather supposed to be bad?

Victoria Ferguson:
It kind of changes, I guess, every day there. But I’m going to Austin, Texas, to go to a Women’s Wealth Summit. So it’s gonna be a bunch of female financial advisors from all over the country, which is going to be a really lovely place for me to thrive and connect and be with other amazing women at that dimensional fund advisors. So that’ll be great.

Matt Mulcock:
Very cool. This is where you continue to build your skills around, um, doing these like money circles and things that we’re starting to roll out for female dentists. We really cool. Exactly. If you find something to help me make me better at my job, I would appreciate it. Okay. Probably a really low like how much time do we have? Let’s get started.

Victoria Ferguson:
Totally. Just make me better at my job. I actually have a running list, Matt, so I’m really glad you said that. Yeah, I’m really glad that you brought this up. I’ll set up a separate one-on-one.

Matt Mulcock:
I’ve said this before, but anything that I say pretty much that’s of any level of worth is stolen. It’s just taken probably, probably. Totally, totally. It’s a good point. That’s a good point. Well, thank you. I don’t know if they’re original, but I do like to, they are influenced from other people for sure. I actually think there’s a quote from the, from Warren Buffett or Charlie

Victoria Ferguson:
Isn’t that true for everybody? Mostly? Like, we weren’t born knowing this. You know, sometimes you have good ideas though, like pretty good original ones.

Matt Mulcock:
Or why should I come up with new ideas when there’s tons of ideas I can get from other people like, so that’s exactly how we, how we do it. Um, okay. So I listened to a recent podcast of his, uh, and the premise of it was overrated, underrated. So basically they just took a bunch of. And, and the, in his podcast, they were talking about like, um, kind of the, uh, self help kind of environment, the self help ecosystem of different like cash phrases and things you hear in the self-help work because that’s where he, that’s kind of the lane he is in. So, but I love the premise. So they go through and they go overrated, underrated. It depends. Um, are they kind of the three main answers, or I guess we can kind of say like a fourth one would be like just right. Um, we’ll call it rightly rated. Um, and so we thought we could take that same premise and do it with financial topics that we hear all the time. So, so we have, there’s a Dentist Advisor’s version.

Victoria Ferguson:
Yes, yeah, dentist advisor’s version.

Matt Mulcock:
Um, the subtle art of, I don’t know, talking about money. Um, I started this subtle, but not so subtle. Uh, so Victoria, any thoughts on this as we, as we jump into this.

Victoria Ferguson:
No, I love it. I think we’ve got a lot of great topics to cover today.

Matt Mulcock:
Yeah, we made a list, we made a significant list and then we cut it down. We’re going to hit 10 today and then we’ll probably do multiple parts. And if you want us to talk about something, let us know. Like we’d love to throw it out. We thought this would be a really effective way of us giving our thoughts on a lot of different topics, um, that we hear a lot. And so we can kind of do kind of a rapid fire type discussion. So with that said, we’re going to go, okay, anything else you want to talk about?

Victoria Ferguson:
Well, I just like this that we’re kind of covering a wide variety of topics and not going too deep on each of them. But if there’s anyone that stands out to you, we have a podcast pretty much on all of these, or at least some resources. So if any one of them jump out, like I encourage you to just take a deep dive into other podcasts where we do go more into depth about.

Matt Mulcock:
Totally. Or if you want us, again, if you hear something and I’d love to you to talk deeper on that, we definitely will. Um, we try to find a good balance here, but again, we thought this was a good opportunity for us to hit a lot of stuff. We hear all the time, um, and, and kind of a broader discussion, um, and just give our opinion on these different areas. So with that said, uh, Victoria, we’re going to go back and forth, uh, through our list, you can throw out the first one.

Victoria Ferguson:
Me first. All right. All right, Matt, budgeting. Over, under, rightly, just right, or depends.

Matt Mulcock:
Um, I would say my first reaction is overrated. I think budgeting is overrated. I don’t tend to believe, I think we as a company, but I’ll just give my personal opinion, I don’t necessarily believe in budgeting as an effective tool. Um, and I’ll say this specifically, um, as, as a longterm tool, I’ll say for success. I’ve said this many, many times. Uh, I think budgeting is something like a crash diet, right? We’ve got summer coming up and you know, people trying to get in shape for summer, trying to, trying to look good in their bathings, hot girl summer, come on. So, you know, I am it’s cutting season, right? Um, no. So I totally understand the premise of saying I have this something coming up. Uh, and I need to, to get my diet in order. I’m going to do this crash diet, right? But that is very, very different than saying I’m just living a healthy lifestyle. And I kind of look at the same thing as budgeting. I’ve actually had clients that I’ve put on budgets in situations that I think it requires it. And what I mean by that is saying, your budgeting is just out of control or you’ve heard your spending’s out of control. We’ve really got to reset. We’ve got to reset your frame of reference around all of these things. So we’re gonna take the next three months and we’re gonna do like an intense like meeting all the time going over budgets, categorizing things. So maybe I’m talking myself into it depends. I think I’m realizing that maybe I am. I’ll say it depends. I will say it depends. I’ll leave it there. Victoria, what are your thoughts?

Victoria Ferguson:
Yeah, you know, it’s really funny because I used to have a very different take on budgeting when I worked at a previous company. I’ve probably made like 500 budgets for people. No, no, it was my dream company at the time. It was a wonderful experience. Yeah, and then I found DA and I was like, oh.

Matt Mulcock:
At the time is the emphasis there. Exactly. Yeah.

Victoria Ferguson:
No, I used to believe in it so much. And then I think what I realized was it’s a really good short-term solution if you just kind of need to get back on track. And if you watched our April webinar with me and Will, we went into this a little bit, but what I view budgeting as is what you hope to happen and tracking your spending is what actually did happen. So if budgeting is ultimately going to set you up for like, disappointment or whatnot. I think it just can be helpful in some cases, but I don’t think it’s a solution for everybody.

Matt Mulcock:
You just made an incredible point there around. Yeah, you’re welcome. Um, around the pure, like which I made it kind of a points across the board. All my points. Yeah. Um, no, but I think you made it a really great point there. Uh, that means the bears kind of diving into a little bit more, which is the negative effects of budgeting, right? Where what meaning of emotionally, like the guilt it creates because you went over some category where it’s like, it doesn’t matter, like

Victoria Ferguson:
Well, thank you. Which one? You like just ate amazing ones. Oh my point.

Matt Mulcock:
To your point, there’s a difference in that versus just tracking spending and creating awareness and being disciplined with spending. That’s different. But if I go over my restaurant budget this month, and now I’ve got to like, I’m going to like freak out and be guilty because my friend asked me to dinner. I just don’t love that. I don’t think that’s a sustainable strategy for success or living a meaningful life with money. Okay, so are we both saying it depends?

Victoria Ferguson:
I think it depends and I’m slightly in the overrated category. Yeah.

Matt Mulcock:
Okay. I think I will do that too. I, what I don’t want to have happen is we go. No, I like that answer. Yeah, let’s do that. Yeah. Yeah, no, I, we’ve already said I’m dedicating, um, I’m going to be much more assertive this year if it’s okay with you.

Victoria Ferguson:
What if she’s using your answer three times? It’s like, whatever she said. I know, what do you think, Victoria? And mine is like, I’m going to live unauthentically myself. I’m sorry. Oh, no. Oh, unapologetically. That’s right. Authentically myself. I’m sorry.

Matt Mulcock:
No, no, you unapologetically. Yeah. I’m going to live unapologetically myself. I’m sorry. Yeah. Um, well, here’s what I don’t want to have happen as we go through these. We’re going to go to the next one. Um, and I actually feared this as we were going through this, cause I’m such a, um, middle road person, everything. And my, my friends make fun of me for this. Yeah. My friends make fun of me for this. I, uh, my best friend, we talk all the time. He will literally get mad at me and he’ll be like, dude, like. stop looking at things so objectively. You’re always looking at things from every side, stop it. And you’re like, just tell me what you think.

Victoria Ferguson:
Let’s just go with like gut reaction. Yeah, yeah, gut reaction is supposed to be quick. Okay, what’s… Nah, no changing.

Matt Mulcock:
Yes. Okay. Gut reaction. Here we go. And no changing answers from now on. Okay. You’re not allowed. Uh, okay. Number two, here we go. Uh, Victoria overrated underrated. It depends or rightly rated whole life insurance.

Victoria Ferguson:
Overrated.

Matt Mulcock:
Tell me more.

Victoria Ferguson:
I think this is huge. Okay. Overrated with like a slight, it depends. And the only reason why I say that is like it, I think whole life applies to a very small niche person and like demographic where like, if you have like a really like high net worth, then yeah, it can like be a really, really great strategy for you, for you to use, especially like transferring wealth.

But for most people, overrated. And the reason why I say that is because it’s like, I don’t know, I feel like it’s just like sold to people. They don’t fully understand what’s happening and it’s usually positioned in a way that makes them feel like they are like stupid for not getting this, that there’s not a better option. The whole like, be your own bank and this is the best way to do it. Well, there are like eight different ways you could be your own bank, you could just put money in a checking account on your own, your own bank, right? Like you could just buy a bank, like, you know, or your brokerage account could be your own bank. Like I just, I don’t know, like it really does not apply to the majority of people, but it’s positioned in a way that creates this like FOMO and fear and makes people think that they need to have it when it doesn’t really fit them.

Matt Mulcock:
Yeah, couldn’t agree more. This is the easiest one for me on the whole list overrated unequivocally. Um, although there, like you said, there are situations where this might fit for someone the way it is sold 99% of the time, in my opinion is, um, does not fit those categories and it is, uh, again, this is something that is sold, not bought. No one goes out there being like, you know what? I want to be my own bank. Um, no one.

Victoria Ferguson:
I woke up one morning and was like, you know, I want a whole life policy. I’m like, let me go find someone.

Matt Mulcock:
Yeah, no, they don’t do that. Yeah, and the way they’re sold is for the most part, usually sold in a very non-transparent and just like, just kind of a slimy way for the most part. And so, yeah.

Victoria Ferguson:
Well, yeah, maybe in the spirit of that, we should probably say a little bit more about what it is. Yeah, just to level set for those who don’t know about it, I know that we talk about it a lot on the podcast, but like for any new listeners, tell us about what it is, Matt.

Matt Mulcock:
Yes. Yeah. So we’ll give a quick rundown. So the two main things, uh, two main, we’re talking life insurance, right? And there’s two main categories. I’m going to simplify this cause we don’t spend the whole entire show talking about this, uh, if there’s any insurance sales, not that they’re going to probably write a very strongly worded email, um, but you, and then we’ll talk about the podcast. Uh, okay. So we’ve got two kind of main categories, right? Of life insurance. You’ve got term and then you’ve got permanent insurance. The main permanent policy sold under that umbrella is whole life. There’s other, there’s other variations of permanent, but all the, the differences term does not have any cash value built into it. It is very straightforward. You say I want a 30 year policy with a million dollar death benefit that costs me X number of dollars a month or a year. And at the end of that term, which is why it’s cold term, it expires. It is no longer there. The people who don’t like insurance and I totally get it, it’s, they look at it as a pure expense, they just say, well, I’m paying for this thing. If I never use it, that’s just wasted money. That is such a, such a mischaracterization of that. Um, that’s like saying renting something is, um, throwing your money down the toilet and as a mischaracterization, um, but permanent is saying same thing, you get a death benefit, let’s say it’s a million dollars. The difference is you pay a lot more into it and a portion of that payment goes to build what’s called a cash value of that policy. Basically, look at it like this, a permanent policy is mixing investments with insurance. And as a general rule, you just should never do that because what you’re usually doing in that situation is just paying a lot more for two different things that don’t need to be combined.

Victoria Ferguson:
It’s a lot cheaper if you separate it, like a lot cheaper. And isn’t it, correct me if I’m wrong, Matt, like the break even on a whole life policy is usually in the range of like eight to 10 years.

Matt Mulcock:
You’re saying as far as the cash value you get out of it. Yes. That you put in. Yes. That’s usually what we’ve seen the most egregious we’ve seen was something in the range of like 15 or 16 years, which is really bad. Um,

Victoria Ferguson:
Like imagine like it took 10 years to break even on this and that’s money that you could have just been investing on your own and like building your own bank really if let’s use their logic, you know, right?

Matt Mulcock:
Totally. Yep. So again, we could spend a whole show on this at the risk of doing that. We will not anymore, but we will just say, again, we’ll cut ourselves off overrated. Generally speaking, do not buy these. They are highly expensive, big commissions. The whole thing is you go to a car salesman, you’re going to be sold a car. You go to a person that says they’re an advisor, but they sell whole life, they’re going to sell you a whole life policy and probably in the first meeting.

Victoria Ferguson:
I would just say like, if you’re in this position, just ask a ton of questions. And also, I think, I don’t know, like choose violence and ask them how much they’re going to make in their first year. Well, because I like calculated it for a client once and I’m like, yeah, you paid this agent like 15, 20 grand in their first year. They made off of just you alone. Yeah. Like a big policy, they get paid out a lot. So ask questions.

Matt Mulcock:
Yeah. 50, usually 50 to I’ve seen as high as 110% of the first year premium. So just keep that in mind. Um, ready. And we got to pick if we’re going to do 10, we got to probably speed it up.

Victoria Ferguson:
It’s insane. All right, we’re ready for the next one. Number three. All right. Yeah, you and I just we yap too much. All right. We’re just yappers.

Matt Mulcock:
We’re just yappers. We’re gabbing like a couple of old ladies at the pickleball court. I don’t know what that meant. I have no idea.

Victoria Ferguson:
Dude, Pickleball’s in. I think that’s part of Hot Girl Summer.

Matt Mulcock:
We’re, we’re, we’re yapping it up like two old ladies at the bingo table. Is that better?

Victoria Ferguson:
Oh, you know I’m a bingo star, Matt. I’m not even gonna give any context to that. Just know I’m really good at it. Number three, estate. I know, that’s why I’m, come on, let’s go. Number three, estate planning.

Matt Mulcock:
So an estate plan is basically you creating a plan when you were of sound mind, to have contingency plans. If you were to have an early death, and here’s the most underrated part of this or becoming capacitated and can’t make decisions for yourself. This is the least sexy topic of all of financial planning, which by definition is not sexy at all. This is like, like financial planning. Financial planning as a whole is kind of like the, your vegetables part of life. And estate planning is like the worst vegetable you can think of. I don’t know. I was going to say, yeah, maybe kale. Like nobody ever wants to talk about estate planning and for various reasons. A it’s boring B it makes it makes you face mortality and it sucks. It really does suck, but it is highly underrated. This is where if you have young children, if you have any amount of assets that you want to protect and control beyond the grave, right? If something were to happen, or again, if you were to have something happen where you were to become incapacitated, do you want the state, do you want the government and the state controlling what happens with that process and putting the people that you’re leaving behind that are taking care of you and, or if you’ve died, you know, um, taking care of your estate, like it’s really about, it’s, it’s really like, um, estate planning is that is really like a very selfless thing to do because you’re basically saying, I want to make sure that, you know, my kids don’t have to deal with this. I’d rather just map it out for them. Uh, you know, when I, when I die. So I would say estate planning is super critical and very underrated.

Victoria Ferguson:
Yeah, what I feel like people don’t really understand is like the state will decide for you. Like someone else will, like if you don’t, somebody else will and who would you rather make that decision? Like, especially if you have young kids, like this is just the responsible thing to do, right? Like you don’t really want a court trying to decide like who’s gonna watch your kid or where things go. You know, make the grieving process a little bit easier on your family if you can.

Matt Mulcock:
Totally. I’ll say both though. So young kids, for sure. There’s a huge risk there of like, who’s going to take your kids and you want to have someone you trust, but let’s take it further. Let’s say adult kids. And now you’ve established and built an immense amount of wealth. Most dentists out there, when they get to a place where they have adult kids, they’re going to have a pretty sizable net worth most likely. Um, let’s say you’ve got three, four or five, whatever multiple kids. Um, if you don’t have anything in place where you’ve mapped out those instructions of how you want things handled.

What you are doing is putting it on them to figure it out. And I think what you’re doing, if you don’t have it, the plan in place, you’ve increased the chances of a fracture in the family. And you might be out there saying, no way, no way my kids would be like that. Maybe, but you never know until they’re faced with that. And by having a plan in place, by having a trust, by having a will, by having all these things done. You, you take any chance of that off the table because you put it in place. You, and you’re taking pressure off of your kids to have to deal with it. So I think it’s an underrated part of this too.

Victoria Ferguson:
I totally agree. It’s just like the loving thing to do. And it’s honestly like not that bad. I mean, it can be kind of, it is a process, it sucks. But like once it’s done, it’s pretty much done. So just get it over with.

Matt Mulcock:
Yeah. And it, yeah, I I’m with you. It’s not as crazy and complicated as people make it for a general estate plan. There’s obviously things that can get really complicated depending on your situation, but for most people, 85% of people, 90% of people, a basic estate plan to have these things in place is not that crazy. So moving on, uh, Victoria, number four, investing in the stock market.

Victoria Ferguson:
I might be biased. First reaction is underrated, but I think that’s because I wish more people did it. So I guess to back that up, I always got to bring my stats, you know, me. Um, no, my God, there it is again. I can’t get away from it. Um, market over the last like a hundred years has done about 10% per year on average and is like the best returns out of any asset class is the stock market. The problem is it is very difficult to stay in your seat and people think, you know, like, oh, stock market’s done 10% per year, like on average, I can do that. But Taylor just recently shared with us that the average investor in the S&P 500, the market, if you will, actually only gets 4%. So I think that part, like people don’t realize like how difficult it actually is to stay in your seat for a long time. I feel like it just at the beginning kind of sounds a little too simple. Like, oh, I just give my money to said stock market, like kind of into this void, and it’s supposed to return me this massive amount of money down the line, and all I have to do is just like sit? Yeah, that’s hard. Like have you seen those videos, Matt, where like they’ll like have a toddler at the table and they’ll put like candy, and they’ll be like, okay, like you can’t eat these, like I’m gonna be right back, and they’re okay. Oh, have you? And they film them and their kids just like, can I eat? Like, oh.

Matt Mulcock:
Did it with my daughter, yep.

Victoria Ferguson:
I like really want to and a lot of them end up eating candy. It’s hard. Like that’s like largely part of like our jobs is just to help folks stay in their seat. Like that’s such an underrated part of an advisor. Like you know the value there. Like that’s why having an advisor on average gives you better returns because we’re here to help you not lose your mind a little bit.

Matt Mulcock:
I mean, we totally grew on this underrated with a caveat is it depends on what, it depends on how you use it. I think just generally speaking though, investing in the stock market is underrated. I think it’s the best asset class to build wealth. For sure. We’re going to get here down the line, another asset class to consider as well. But I think it’s the best asset class for various reasons. The barrier to entry, the transparency, the returns, the passive nature of it. The overall pretty simple approach to it now, the access to it is second to none with other asset classes. And so, and I think it gets a bad rap for the most part. And I think a lot of that is largely due to financial media and the ecosystem we now live in that is trying to get you to play a different game with the stock market, if you’re playing the right game, the long-term game, the discipline game built around principles of investing. It is the best thing you possibly can do to build wealth over the next 20, 30 years plus. Um, so if you’ve got it, if you’ve got the timeframe, most of our clients, and here’s the other thing we say this all the time, even like, let’s say a 40 year old or 50 year old right now is saying, well, I don’t have 30 years. Well, hopefully you do. Cause we’re talking about your lifespan. We’re not talking about your career span. So you will be investing in the stock market, hopefully for the next 30 plus years, even if you’re 50. So.

Victoria Ferguson:
Yeah, it’s not like you turn 65 and we cash you out. No. Yeah.

Matt Mulcock:
Yeah, exactly. You shouldn’t. You shouldn’t. Yeah. You still need to have that growth. Yeah. So definitely underrated to your point. People don’t use it properly. And usually the reason why people don’t succeed in investing in the market tends to generally be more about their temperament rather than their tactics. So to your point, yeah, it’s usually lack of patience or getting distracted, shiny, shiny object, whatever it may be. So definitely underrated.

Victoria Ferguson:
Shall we hit number, what is this? Five? Okay, passive income. Let’s hear it. Okay. I was surprised me a little bit. I was expecting you to go off on that one. I was, I was ready. I was ready to like rile you up and be like, yeah.

Matt Mulcock:
Yeah, I will. Yeah. So I thought about this one before we went on. I knew this would come up. My first reaction when we were going through the list was obviously it was going to yell out overrated. But I will say it depends because I think it depends on your mindset of passive income. Well, I guess I break this up into two different categories. The first category being if we’re calling it what it is, which is I own an asset that kicks me off some dividends or income in a way that I don’t have to work for. Like I don’t have to do anything for it. Like once I’ve got like the outcome, there’s the outcome category. Like I now have this passive income to me that is like probably properly rated, which is it’s freaking awesome. Like everybody wants it.

Victoria Ferguson:
I’m actually really glad that we took the time to say what it is, because I hear it so much on like consults or in conferences like, yeah, I got to get some passive income. It’s a huge buzzword in the dental community. But like, I don’t think we’ve ever said like, well, this is what it actually is. Right. So I’m really glad that you said that.

Matt Mulcock:
Yep. Yes. Yeah. I mean, that, that is what it is. It’s it’s incomes or dividends or something, some type of, or, or here’s the other thing that I will say. The other part of this is, um, how about growth? Like it’s, it’s meaning people always think about it have needing to be income like that, that passive income, like cashflow, but I actually want to broaden that out a little bit and say, well, what about just passive returns? Because for example, we talk about the stock market. The stock market is more passive than any asset class out there because you do not have to actually do anything outside of, I mean, there’s obviously things you should be doing, but if we go to the most basic approach of just buying an index fund and sitting there, that is as passive as it gets. I’m not claiming that’s the optimal strategy. That’s not the approach we take. I think there’s more ways to improve those returns in a systematic way. But again, it can be extremely passive, far more passive than other asset classes. So again, I would say the outcome of passive income of just saying I’ve got this income coming in that I can, I’m getting as I sleep at night, absolutely properly rated because again, I think everybody out there would say that’s freaking awesome. Here’s the other part of it though. It’s how it’s sold. That’s where I think it is so overrated where people are pitching this like, yeah, just buy a piece of real estate and you get passive income. It is not that simple.

Victoria Ferguson:
It’s not that simple. Never is.

Matt Mulcock:
It never is. And the misunderstand, the mischaracterization and misunderstanding that passive income just like happens. Like, Oh yeah, I just go buy this thing. And it’s just like, I have it now. No, like anything worthy in life, any worthy goal is going to take an incredible amount of time, whether it be exactly. Yeah. So this is what I’ve always said. And we talk about this when it comes to passive income. Here’s the truth of it that no one can, this is just a full on truth. You can’t, there’s no one out there that can deny this. To end up with the outcome of passive income, you need one of three things, and usually all three. Time, energy, and capital. You need one of those three things and usually all three. So you might hear, the only thing outside of the only way you actually collect passive income without you personally having those things is inheritance.

Victoria Ferguson:
Right, that’s what I was just thinking.

Matt Mulcock:
Yeah, but you, so you get an inheritance. So you’re getting, let’s say you inherit a bunch of properties from your parents or from your grandpa or whatever.

Victoria Ferguson:
Because you did the estate plan that we told you to do. Nope.

Matt Mulcock:
Cause you did the estate plan exactly. Oh, I see what you did there. Then you get passive income to you. But the person you inherited it from, there was no way around it. Time, energy, capital. Those are the three things that precede passive income. I’m gonna kick it to you. Sorry, that was way too much.

Victoria Ferguson:
No, I love how we were like, we’re not going to spend too much time on this. That’s exactly what we did. No, I think that was great. I think that was everything that needed to be said.

Matt Mulcock:
You’re right. Hopefully it was helpful. Uh, okay. Number six, we’re, we’re doing okay. We’re doing good. I think on time. Yeah. We’re all right. Uh, okay. We are, we’re so amazing. My gosh. Um, okay. Okay. Number six, uh, Victoria, financial advisors.

Victoria Ferguson:
I wanna know, I’m kinda curious what you think I will say, but my wholehearted, what? Yes, you can guess. It does depend. I, oh man, I know I’m gonna say I’m gonna go against this, but I really don’t wanna spend too much time on it. But really there is like, Dentist Advisors is my fourth company, like fourth financial services company. So I’ve seen a lot and interacted with a lot of financial advisors just all over the place. And it so depends on the advisor. And so like, I really do understand folks who like kind of have a vendetta against financial advisors because they probably did have a bad one. There’s absolutely god awful financial advisors with massive books who massive who manage like a massive amount of assets who just like aren’t good because if you really dive into the role of an advisor, part of it is sales and the other part is being an advisor. It’s pretty rare that you find somebody that can do both really well. It’s kind of funny, but the best advisors tend to be the best salespeople, unfortunately. So those people just are really good at telling a story and they bring you over, get your assets over, and then talk to you maybe once a year. Whereas a good advisor is going to check on you multiple times a year. Actually talk to you, care about you, know your situation, answer your questions, all of that. But no.

Matt Mulcock:
Talk to you way more than just investing, right?

Victoria Ferguson:
And I think like a huge part of like why advisors get a bad rap is like all they do is talk investing. Whereas like a good advisor is much more like life planning in my opinion. You know, like what are your goals? What are your values? Like really, that’s why I love like our philosophy and not to toot our own horn, but I’ve been so many places where this hasn’t been the case for me, but I love it here because I feel like the way we see it is like, we wanna help you live the life you want to live. At the end of the day, that is my job, is to make sure that you can sleep at night, that you’re well protected, that you’re getting to do the things that you wanna do in your life sustainably, and that you get to do that in your sunset years. And money, it’s just the tool. That’s the tool that I use to help people live their life. And it is such a fulfilling job. I love it so much. And I just, it’s great getting to be able to help people do that in a sustainable way. Most advisors are, I don’t know about most, but a good chunk of advisors.

Matt Mulcock:
Most advisors suck. No, I’m just kidding. I thought that’s what you were gonna say. I’m just kidding. There’s a lot of good ones.

Victoria Ferguson:
No, no, I’ve met, there are far better advisors out there than me that I’ve met, but no, I do a pretty good job. But no, I’ve seen some of the best advisors out there and just some of just the worst who really just want to collect your investments and then really never talk to you. So I guess if you’re thinking about getting an advisor or you’re kind of in the market for one, like make sure that person aligns with what you expect out of an advisor, what you’re really looking to do. Maybe you are that person like, yeah, I just want someone to manage my investments for me. I don’t care to talk to them. Cool, like find an advisor who does that for you. But if your expectations are not aligned, then find somebody who does match up with you a little bit better.

Matt Mulcock:
Yeah, I had a feeling you were going to say it depends. It’s the same answer that I have. It totally depends. You highlighted everything perfectly. Uh, one analogy to the dental space. Or I think one thing to talk about here is if you compare financial advisors, the way you talked about of saying, there’s so many out there, you’re going to get so many different versions of what an advisor actually is one of the biggest problems in the financial advisor space. The dental space doesn’t like it’s total opposite of the dental space in the sense of if you go to a dentist and they’ve got DDS by their name, DMD DDS, um, uh, do you know that they’ve gone through some base standard bear like barrier to entry, right? Like it’s pretty standard across the board. Now, do you have some bad dentists and some good dentists and everything in between? Of course, of course. Um,

Victoria Ferguson:
I had a dentist drop a tool on my face once. Never went back. Ha ha ha.

Matt Mulcock:
So, so you’re going to have like any profession, you’re going to have good doctors, bad doctors, good lawyers, bad lawyers, whatever. But there’s a standard of care that has been set through by going through that barrier to entry when it comes to a dentist. That is not the case with the financial advisor space. And to your point, the history of the financial advising space has been so sales driven, which is, and we fully admit this, it is so dirty. The financial advising space is so dirty. And it’s really difficult as a consumer of it. No, but I mean, it is a dirty, like the history of it is pretty dirty, right? If you look back into like the, the origins of the financial advising space, there’s a reason why you go Google financial advisors are, and you’ll look at the list, look what comes up. Right. Um, and there’s good reason for it. You look back to the eighties, the sale, like the Gordon Gecko, the Wolf of Wall Street crap. Like it has dirty, dirty origins and still remnants of that. What you just said perfectly is we think a quality financial advisor that’s doing it for the right reasons should be more of a life planner focus rather than selling you anything products are part of it, but they shouldn’t be the plan.

Victoria Ferguson:
Yeah, I actually do also feel like the industry is shifting more towards that way. Like all of like the baby boomer financial advisors are going to transition their books, probably to their sons and daughters. Not me, unfortunately. But I think it’s transitioning more that way. And I really have a lot of hope for our industry because like you’re right, like it has such like a dirty history and screwed over like a lot of people, I think. But I do have a lot of hope for the future and that I am seeing more like of a life planning approach and different like practices and companies. So I think it’s gonna get better. Yeah.

Matt Mulcock:
Oh, I think it already is. I think it totally is. And the difficult thing for us and then we’ll move on is like you said, it’s so sales focused, right? One thing that I’ve said, and we fully admit this, that we try to take such a practical approach and education based approach. We’re not interested in being super salesy that sometimes it actually works against us, um, in the sense of like, we’re, we’re not going to sit here and try to like sell anything flashy because a lot of this is not flashy. It’s very practical. It’s very, again, principal focused. It’s very like, like we’re not, we’re not the people selling the pill, right? We’re the ones selling the, the healthy lifestyle over time. And that thing that is very, very hard to sell to someone.

Victoria Ferguson:
A lot of it is just like, it is kind of just boring and unsexy. That’s why we have to have like stellar personalities, you know?

Matt Mulcock:
Clearly. Yeah, clearly. So, okay. Exactly. That’s why we have to be awesome. Yeah.

Victoria Ferguson:
Just wow people. Like I know what I’m about to talk to you about is like horribly boring, but like, yeah, I’ll bring some dad jokes like absolutely. I always have those dialed.

Matt Mulcock:
But we’re gonna do it in a fun, fun way. So, yeah, of course. Yeah. Okay. Think we’re on number seven.

Victoria Ferguson:
All right, let’s do it. Matt, are you ready for the next one? 529s.

Matt Mulcock:
Ooh, I actually think 529s are, I’m going to say, properly rated.

Victoria Ferguson:
Really? That’s not what I expected. I thought you were gonna say overrated.

Matt Mulcock:
Well, I’m going to say properly rated because I actually think most people that I come across, I have no data behind this. You’re the study buddy, not me. I’m just going off of like anecdotal just conversations. I actually think more, most people look at five 29s as what they are. Um, a somewhat limited tool that can be helpful for saving for kids college. But probably not the number one vehicle I would use to save for kids. And I think most people I come across have a similar view to that. I actually would say more people than not, there’s more of a little bit of a negative tone to them, which I lean towards. I don’t really think 539s are that great, but I actually think the general market agrees with that. So I would say in my opinion, properly rated. They’re not bad. I just think they’re rather limited. And I think there’s other things I would point to first things like minor Roth IRA or just a brokerage account. I just, I don’t think five 29s, even with the recent changes they made are that great of a tool. Um, so I’d say properly rated. What do you think?

Victoria Ferguson:
Well, I’m gonna, I’ve got a backbone, so I’m gonna stick with it. Ha ha ha.

Matt Mulcock:
What do you mean? I stuck with it. What are you talking about?

Victoria Ferguson:
Well, I’m going to just stay with my answer. You know, I mean, the first one you were like, oh, this, maybe that. And then we landed, you know, we landed that plane. No, I meant the first one with budgeting. Yeah. So I’m not going to change my answer. No, no, no. Um, I feel like, okay, this we’re all biased human beings. So this is like just my perspective from where I come from. Um, oddly enough, like a lot of my clients are like parents and have young kids.

Matt Mulcock:
Oh, got it. And we said no more changing answers. Okay. Got it. Got it. Deal.

Victoria Ferguson:
And so most of the time with them, they like come to me and they’re like, oh yeah, like I just opened a 529 because like I thought that’s what you’re supposed to do. And then the two questions I always ask when, you know, parent is like, I want to save for my kid, I say, or ask them, what do you want the money to be used for? And how much control do you want over it? Oftentimes when they give me their response, a 529 isn’t the answer because they’re like, oh, well, you know, I kind of hope like to be able to help them buy their first.

Maybe like give them something for their wedding. But like just in case they like are, I don’t know, turned out to be a bad egg or whatever, like I don’t wanna just like, why are you laughing? Yeah, like what if they’re just like a bad egg, you know? Like usually, isn’t it like the first kids usually like just the first pancake? Yeah. Right. I was just going to say, poor girl, she’s going to listen to this in like 10 years and be like, oh, you did. So I don’t know. Maybe they’re a bad egg or they’re such a good egg that they get a full ride scholarship. Right. Like that’s people usually say like, oh, what if my kid doesn’t go to college? I’m like, what if they go to college like really well and they got paid for, then your money’s kind of stuck there. So oftentimes when I’m kind of like, let’s take it back to like, okay, what like the purpose of this money, oftentimes a 529 isn’t the best fit. And so what I like to do is then just like go through some other like alternatives that fit those answers a little bit better. Not that they’re like bad by any means. I think my problem with them is like, people just don’t know other alternatives. So they kind of just turn to 529s and then they’re like, oh, that’s not really what I wanted. But usually by the time like I’m working with a client, it’s fine, it’s not a big deal.

Matt Mulcock:
Yeah. So did you give an answer? I mean, you gave an answer, but next book. Oh, over. I didn’t hear you say that. Okay. Overrated. Got it. I’m saying properly rated. You’re saying overrated. Got it. Okay. We are on our way. Uh, number eight, right? Yes. Number eight, uh, Victoria, real estate.

Victoria Ferguson:
Yeah, I said overrated. Oh, sorry. Overrated. Done. Eight, yep, we can count. Yes, that is such a hard like it depends for me. Slash with like a sprinkle of overrated. Oh my God, that is my absolute honest answer. It depends with like a dash sprinkle of overrated. Reason why I say that is like we are absolutely not against real estate. I think it’s like a great asset class for a lot of reasons Mostly because like it’s Illiquid and you like kind of have to sit in your seat. Whereas with the stock market you can get up anytime you want And that’s kind of a con to the stock market Not necessarily a reason to go into real estate But I think that’s why people like will have some success with this because they can’t get out of their seat with it um, my problem is like I feel like it’s just socialized more as a better asset class and kind of similar to my take on 529s is like you’re not exploring alternatives. I think a lot more people got into it, especially during the pandemic when interest rates were super low and people just went wild over real estate. But still to this day, I will work with folks who are like, oh yeah, I’m thinking about getting a rental property.

But like they don’t have anything in a 401k or like an IRA. And so, or any emergency fund and they kind of, I think where it becomes dangerous is when you think that is the solution and you have made it in your mind that this is what is going to generate me wealth, this one asset class with anything like, you know, it’s probably not one thing that’s gonna generate your wealth. Like for the most successful dentists, it’s your practice. Plus the stock market, plus probably some real estate too in that, and downside protection with the insurance that we’re kind of talking about there too. So no, I just think it just becomes dangerous when you kind of get caught in the loop of like, this is the answer to wealth, right?

Matt Mulcock:
Yep. Yeah. I mean, I think we’re on the same page with this one for sure. It’s a similar answer I’d give to the passive income one, because they go hand in hand is so for me, it totally depends. Right. I think real estate objectively, real estate is great. I think as an asset class, it absolutely can be a great place to park your money and to invest and grow your wealth. Um, really quick, you said there’s not one thing that, right. That’s going to lead to generating your wealth. The one thing I would say, if there was one thing would be time. Time is, and, and that is across the board. Right. And this is where I think the biggest misconception, uh, that’s out there around this kind of stuff is for some reason, um, and this is, I’ll say this. I think the danger of real estate, you alluded to this, I think the danger of real estate is it can become a distraction from the order of operations for a dentist. So to your point we’ve had so many dentists who, who call us, we have consultations with them and, uh, I’ll give a general profile. We hear a lot, uh, year three practice owner, maybe barely hitting seven figures or maybe not even there yet. And seven figures in collections. Um, they’re just getting kind of their feet underneath them as far as their systems and their growth and their case acceptance and their, you know, how they’re going to handle PPO and how they’re handling marketing, like they’re just barely kind of getting a grasp of this stuff.

Or maybe they’re not even there yet. And they’re like, you know what? I’m going to go get into real estate. That to me is such a dangerous thing to do. And it sometimes comes off as if we’re that makes us anti real estate. And I’m like, no, we are not. We are pro thoughtful decisions. We are pro, um, making decisions in the right order and realizing that you are far better, like real estate is a whole other profession, whole other profession. So why would you spend all this time, energy and money to become a dentist to then say, you know what? I think I can be a real estate mogul. It’s like, well, you didn’t need to go to dental school to do that then. Like focus on dentistry, because that’s your main advantage over 99% of the population. So I think real estate is great. Just like I think the stock market or private investments can be great asset classes if approached in the right way with the right mindset. Where I think your dash of overrated comes in is the way it’s sold and the mindset people have this whole idea of like, I’m just going to go get into real estate. It’s like, well, okay, we got to talk because there’s so much more to this than that.

Victoria Ferguson:
Yeah, I agree. And I feel like whether people admit it or not, I think people who are a little bit like, like antsy to get into real estate think it’s going to generate them wealth a lot faster than they like, it will not just like just with the stock market, it’s going to take like, years like decades. And I think because like, you know, recency bias and like housing’s done relatively well in recent years. You know, like people kind of think that they’re going to, it’s like a get rich quick kind of gimmick and it’s not like, it’s really not, it’s going to take a lot of time to get to where you think you will get faster, you know? So that’s yeah, if you think it’s like a get rich quick thing, it’s it is not.

Matt Mulcock:
The only get rich quick aspect of real estate are the people getting rich quick off of the courses that they’re selling you to get rich quick in real estate. Like yeah, yes, those people are getting rich quick off of you. Making you believe that this is some get rich quick scheme and it’s not. Everything takes time. Success in investing and I’d say I guess just life in general, success comes in decades.

Victoria Ferguson:
They teach you. Yeah, like teach a real estate course. You want to get involved in real estate, teach a course. Yeah.

Matt Mulcock:
It does not come in years or months. It comes in decades. It takes daily, monthly, yearly action, but the result of success is always in decades. And that’s with, yes, do it for a long time. This is why we tell people, I don’t care if it’s real estate or the stock market or private investments, it can be building up a bunch of practices to build your wealth. And that’s what you want to focus on. The only strategy we really think matters.

Victoria Ferguson:
Yeah, do something for a really long time.

Matt Mulcock:
The only part of a strategy that matters is having one you can stick with. That’s it. So if it’s real estate, awesome. But if you think you’re just going to go out there and buy a rental property and not understand real estate at all, and you’re going to all of a sudden have passive income, I promise you, promise you real estate is anything but passive, uh, for a long time.

Victoria Ferguson:
Yeah, like consider alternatives what you could have done with that down payment. You could put that all on the stock market, you know? Consider, yeah, that’s what I would say is like always consider alternatives before you go into anything, including the stock market, you know?

Matt Mulcock:
Yeah. Yep. Yep, totally. OK, we belabored that one. Go ahead. We’re on number nine. We’re almost there.

Victoria Ferguson:
Number nine, we’re almost there, people. All right, Matt, we’ve got tax saving strategies.

Matt Mulcock:
Ooh, baby. Oh baby. Um, this is the most over. I said whole life, but this is the easiest answer overrated overrated. Yes. Believe me. I hate taxes as much as the next person. Um, but so overrated, uh, with a dash, as you put it, uh, it, a sprinkle of it depends, but it’s definitely more overrated.

Victoria Ferguson:
You’re gonna say that to some dentists who love tax strategies, tax saving strategies. We’re gonna get cancelled.

Matt Mulcock:
And again, because dentists are so targeted on this stuff and they’re, they’re made to believe that you can make a ton of money, um, and pay no taxes, just like John D Rockefeller did, or just, you know, take this strategy, like this built billionaire, like it’s so, it’s so like, I just hate how this stuff is sold, um, where I say there’s a dash of depends is if you’re taking on and employing practical tax saving strategies. There are tons of them, tons of them. Then yes, I’d say it kind of teeters on the edge of it, depends, but more times than not, the way these things are sold, overrated, overrated. And it’s really just gonna lead to you paying a ton of money to a bunch of salesmen who are gonna lie to you about a bunch of crap and you’re probably gonna get audited. So, and it’s not going to end well. So yes, there are tons of tax-shaking strategies to use and to utilize and to implement on a regular basis, but the bottom line is the harsh truth is if you make a lot of money in this country, you’re going to pay a lot of taxes. Just how it goes.

Victoria Ferguson:
Yeah, like there’s some things that you can do to kind of curb it a little bit, but like at the end of the day, like you’re going to pay your taxes. And there are people and like salespeople out there who will sell like different things. Like I was telling you that a while ago, what is it called? Like asset structuring? You know what I’m talking about? Like, or like business entity structuring, like you have a business that’s technically in like Idaho. So like if something happens to your practice, they can’t sue this and blah, blah. Well, I was at a conference and I was listening to someone pitched. I don’t know. I’m just making up some states. I was at a conference and I was listening to somebody like pitch this and it was pitched as like a, you can’t mess up. Like this is like gonna save you money. Like blah, blah. This is foolproof. Like whatever. Like I guess.

Matt Mulcock:
I think it Nevada you’re talking about. Yeah.

Victoria Ferguson:
Run, like any time you hear that in our industry, like especially because our industry does have like a dirty history of this, and unfortunately a lot of that still lingers today, and it has a very like big presence. I would just say as a general rule of thumb, if you hear any sort of like guarantees, foolproof, you can’t lose money, or this is gonna gain you a bunch of money, like ask so many questions, so many questions, and always ask.

How do you get paid? I know that sounds kind of like, but like ask, absolutely. Like we disclosed that on the first call with every single dentist. We’re like, this is exactly how we would get paid from you.

Matt Mulcock:
Totally. Um, there’s a famous quote from Peter Lynch. Uh, one of the best, probably the best investor of all time, or at least one of right up there with like Warren Buffett, he’s one of the most famous mutual fund investors of all time. Um, he has a quote talking about market timing. Bear with me for one moment. I’m going to bring this back full circle. I promise. I think I’m going to land this plane. Um, he, okay.

Victoria Ferguson:
All right, all right. Okay, I’ll stay in my seat like I’ve been telling people to do.

Matt Mulcock:
So he has a quote that talks about market timing. And he says that more money is lost trying to time a market correction than in the correction itself. Right? And so I liken that to this, to tax strategies. I think that quote applies to a lot of tax strategies. I think more money is lost and more, yeah, more money is lost trying to save on taxes with these ridiculous strategies out there and these products and all these things that people are selling, then just paying your taxes in a lot of cases. I’m not going to say in every case, but not to mention the stress and anguish it can create if something goes wrong. Like I’m actually feeling really bad about a lot of these dentists out there who at some point or another are going to have ERC come back to get them with the IRS. It’s most likely going to happen at some point or another.

I think just keep that in mind the time energy and money you’re spending trying to avoid paying taxes Rather than just again taking practical steps and approaches. We implement a ton of tax saving strategies But none of them and some depending on who’s out there like depending on the CPA might actually even say Some of the strategies that we try to employ with our clients are even in the gray but none of them will ever fall into fraud or tax evasion or crappy sales tactics ever.

Victoria Ferguson:
You know, I was just thinking as you were talking, I think to sum up part of what you said, I think what is going to cost someone the most in this effort to save on tax strategies is just misinformation. Like if you, like, it’s funny, and I don’t wanna sound like demeaning or anything, but whenever I give like a tax presentation and I show people like, oh, this is how the American tax system works, most people don’t actually know that  a lot of people have this misunderstanding, like, oh, if I make, if I jump into the next tax bracket, like, I don’t want to do that. Like, I don’t want to make too much money because that’s going to be a net negative. That’s like, so many people believe that, um, and we’ll take action based off of that. And it’s just not true. The more money you make, it’s always a net positive where people get in trouble. Kind of like what you’re speaking to is chasing deductions. Like how many dentists have you seen like chase deductions and like spend on that thinking that it’s going to save them in taxes, but bottom line is just net negative. So honestly, what’s going to hurt you the most in this is like misinformation. So if you were going after a tax strategy, learn about it, understand really the implications of it and partner up with your CPA and your financial advisor to see if it’s actually going to net you more money.

Matt Mulcock:
Yep. Love it. Uh, okay. Last one. This is not, this is not really a real one. I’m actually feeling really self-conscious about it now. It’s the realest one. It’s just the most, um, it’s just the most, um, uh, self-promotional, but here we go. Uh, last one, number 10 Victoria.

Victoria Ferguson:
Last one. This is the realest one. What are you talking about? Come on.

Matt Mulcock:
The Dentist Money Summit. You are ready locked and loaded with that. I agree.

Victoria Ferguson:
Underrated. This is the best one out of all 10 of them. You know, who wouldn’t want to come to Park City on June 21st and 22nd to come hang out with us, meet us in person? We love to meet people in our community. It’s so much fun to meet our listeners and folks in our community. And we’re actually doing a live podcast, so you can watch Matt and Brian and be in the room, ask the questions, and your voice can be on the Dentist Money Show. Who wouldn’t wanna be there, right? Like, I’m gonna be in the background, just like absolutely cheering you guys on, trying to probably make you guys laugh, if I’m being honest. But no, it’s gonna be amazing. We’ve got incredible speakers, a lot of them. Who are, who’s coming? We’ve got, no, we do, here.

Matt Mulcock:
A lot of them. A lot of great ones. A lot of good ones. Now.

Victoria Ferguson:
I can list them out. We’ve got Keira Dent, Dr. Ashley Hoves, Michelle Jorgensen, Victoria Peterson. I’m listing all the women first. You know, I’m going to, but no, we’ve got really awesome speakers and you can see the agenda and our speakers at, what is it? Denn Was that good enough?

Matt Mulcock:
I love, it was great. Um, I loved that the main point of coming to the Dennis money summit we’re selling is like, come hang out with us and our listeners love to meet us. And we love meeting, like, um, I love that. So yeah, no, I think it’s great. No, I really do. Uh, we like, we’ve put a lot of time, energy and hard into this of making this as valuable as possible, right. And really like elevating the dentist and our dentist, the dental community and bringing the dentist together, bringing the dental community together, connecting them, building this, this community. Um, and, and this is our first crack at it, right? So we’re not claiming it’s going to be perfect, but we’ve put a lot of. You are saying it’s going to be perfect. I think there’s going to be some, some things that, you know, it’s not, again, no event is ever perfect, but we have put a lot of heart, um, and soul into this of making this the best possible event ever. And trying to make this a little bit different than other dental events out there, in no way diminishing other dental events. We go to tons and we think there’s so many great ones out there, but we’re just trying to do a little bit of a, have a little bit of a different spin on our summit. And I think this is just gonna be probably one of the most family-friendly events of like the location that it’s in, all the activities that are gonna be available to dentists out there. So truly, we’d love for you to come.

Seats truly are filling up and we’re so excited for how many people are going to be there. And we would love you to come as well. We truly would love to meet, like you said, listeners and our clients that are out there. Probably the number one reason we’re the most excited is to meet our clients because a lot of them we have not met in person. So really excited about it.

Victoria Ferguson:
I’m gonna be fangirling the whole time over my clients. You know I am. You’ll hear me in the hallway.

Matt Mulcock:
Yeah, I know it’d be cool. It’ll be cool. Yeah, no, it’ll be, I know I can only imagine. Oh my gosh. Yeah. Oh, I have, I have seen you do this before. Um, so we’re excited. Like you said, check it out, Denn Um, okay. That is it, Victoria. We just went through 10 financial topics. Uh, it was a lot. Hopefully it was helpful. We would love to do, we have other topics, we have probably another 10 plus, so maybe we’ll do kind of a part two of this, but hopefully we should do a part two, uh, hopefully it was helpful Victoria, any final parting words for the good people.

Victoria Ferguson:
Yeah, let’s do part two.

Matt Mulcock:
Victoria, thank you for doing this. This is great. Everyone. Thank you for listening. We appreciate you so much until next time. Have a good one. Bye bye.

Victoria Ferguson:
Thank you.

Behavioral Finance, Insurance