Money Tips from the Founder of Dental Investment Group – Episode 194

How much does the founder of the Dental Investment Group think you should pay for financial advice?

What happens when two dental industry financial gurus get together to chat? Find out on this episode of the Dentist Money™ Show as Reese interviews Sunny Pahouja, full-time dentist and founder and moderator of the popular Dental Investment Group on Facebook. 

Reese and Sunny take on a variety of topics from market volatility to how to avoid scams and finally to how to navigate the world of financial advisors. There’s sure to be a nugget of wisdom for all investors from novice to expert. 

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Podcast Transcript:

Reese Harper: Hey Dentist Money Show listeners, it’s Reese Harper here. Today’s interview is one of my favorite people, Sunny Pahouja. Sunny is a very successful dentist, and the founder of The Dental Investment Group on Facebook, which has a very vibrant and lively community around financial planning topics, investment topics, and it’s a super diverse group, and he’s masterful at creating a good environment where a lot of voices get heard. And I think he’s done a really good job of creating a great community.

Reese Harper: I wanted to talk to him today about his perspective around financial advisors and how to look for a good advisor. Also, investment thoughts, insurance thoughts, a lot of personal finance topics that he’s been able to field from a lot of his listeners. I hope you enjoy the show just as much as I do.

Announcer: Consult an advisor or conduct your own due diligence when making financial decisions. General principles discussed during this program do not constitute personal advice. This program is furnished by Dentist Advisors, a registered investment advisor. This is dentist money. Now, here’s your host, Reese Harper.

Reese Harper: Welcome to the Dentist Money Show where we help dentists make smart financial decisions. I’m your host Reese Harper here with a special guest that we’ve been trying to get on the show for months now, the busiest man in Facebook, and one of the most interesting dentists I know who’s got a super particular interest in personal finance. I’d like to welcome Sunny Pahouja to the show. Sunny, welcome.

Sunny Pahouja: Hey, thanks man. Thanks for having me on.

Reese Harper: Yeah.

Sunny Pahouja: I’m over excited. I read a lot of stuff on Facebook about you and what you do for dentists, so it’s awesome for all the transparency and all the education that you put out there. Thank you for doing that, because I think a lot of us need that, and it’s just amazing to see how much misinformation’s out there. Thank you for doing what you do.

Reese Harper: Yeah. Well thanks, Sunny. I’ve appreciated all of the same. I think you and me share a lot of similar values in terms of just trying to provide a lot of different points of view. An academic approach to finance that’s just transparent, and that there’s a lot of ways to invest money, there’s a lot of ways to grow money, but it’s important to know the truth about as many investment principles as you can instead of being kind of persuaded by, let’s say, kind of like a drug company that’s controlling the dissemination of medical advice.

Reese Harper: I don’t like to see that kind of stuff happen. You don’t want to see doctors being persuaded by drug companies to diagnose a certain way, and I don’t like to see financial professionals being persuaded to diagnose a certain way because of how they’re paid by drug companies, which are the insurance companies, the mutual fund vendors, different private placements, different software vendors. Sometimes these products can influence a financial advisor to give advice in a particular way that is not objective, it’s not academic, it’s not well supported, and it doesn’t help people, it just is a sales game, and-

Sunny Pahouja: And you’re right. And, unfortunately. And, I guess, is it fair to say that a lot of that is driven by commissions, a lot of that is driven by the lack of transparency because you’re working for one form or another, and you’re just kind of … You’re forced to kind of push that product or service onto your clients, and what I like about what you guys do is that there’s a lot of that independent research, independent education that goes beyond what a company is trying to sell. It’s kind of nice to see that we can talk about investments, we can talk about advice that is independent of a certain product or service that’s out there.

Reese Harper: Yeah. It’s really tricky in my industry because there’s no perfect compensation model, there really isn’t. There’s commission-based, then there’s fee-based, and then there’s fee-only. I wouldn’t say any of them are perfect, but they’re increasingly better the closer you get to fee-only. Commission-based financial advice is just the equivalent of a doctor getting paid based on which crown he places, from which vendor, using which … or, which composite he uses. That’s not good. The patient should pay a fee to the dentist, right? The dentist should not be paid by Henry Schein for using a particular composite.

Sunny Pahouja: Correct.

Reese Harper: Right? And that’s kind of intuitive, but in financial planning, that’s not, I don’t know if it’s 90%, but close to 90% of the industry still functioning largely in a commission-based environment. Just this week, I saw a really significant case of annuity churning. Annuity, meaning someone sold a product that an advisor got paid a commission on, and then every year and a half or so, they were just sold again, and again, and again, a new bell and whistle that came with new commissions, and basically this money has just done negative growth rates for almost 20 years.

Sunny Pahouja: Yeah.

Reese Harper: And it’s just, it’s a bad, bad, bad model. I don’t think there’s a perfect model. Everyone wants it to be as cheap as possible. In my experience, I found a combination of a minimum fixed fee that’s transparent. Two grand a year, or four grand a year, or six grand a year. You have a minimum, and then as people’s wealth grows and gets bigger, if they want to have you invest money and get more services from you.

Reese Harper: As long as you’re not getting paid on any specific investment, then that’s the model we’ve chosen. I think it’s a pretty good one. It’s a good fee-only option, but I don’t think it’s perfect. I guess I just wanted to throw all that at you to get your perspective on this, because I know your listeners, or your members, probably have … they range from hating financial advisors and thinking they’re the bane of their existence, to people that really appreciate them and everyone in between. How do you see kind of this whole discussion around fees, and compensation, and transparency? All that I just threw at you, I want to just get your kind of two-cent.

Sunny Pahouja: Yeah. You know, while there are a ton of smart members in the group, I’d still think just about every single one of us can use some advice on how to invest, how to put in for retirement. And I come across people on a daily basis, messages, private messages, “This is my situation. What would you do? Can you answer this question? Now see, I’ve got this much money.”

Sunny Pahouja: And it goes to show you that there is a lot of help that’s needed. Just because people make good money, and just because they’re good at dentistry, doesn’t mean they’re good at making financial decisions. Or they’re good at making those decisions, but once their wealth grows, they just feel uneasy about what to do with that kind of money.

Sunny Pahouja: And what I find is that people really need some kind of guidance on what to do to help them grow that money. And it does range. I mean, there are people, you’re right, there’s that whole DIY, “I kind of do it all on my own.” To people that, “I need step-by-step directions on how to make this happen for myself and my family.”

Reese Harper: It’s difficult right now to find … I want every person to have some access to advice, some kind of access. I feel like the industry, financial planning industry, hasn’t done a very good job of letting people choose their access level. Right? It’s either all in or nothing. It’s like you either have to go find free advice from a friend or family member, or you have to turn over your whole life savings to somebody and not want to do anything.

Sunny Pahouja: Right.

Reese Harper: And it’s hard to build different service models for different types of people, because the one that’s the most easy for me to build is the model where people are saying, “I don’t really want to do this anymore. Can you just do it for me? I trust you. I have confidence that you’re transparent. You have a whole process built for me.” But that’s a pretty small part of the market. That’s still probably only 15% of people, maybe 20. I don’t know, it might be as many as 30% of dentists.

Reese Harper: But there’s another third out there that is totally wanting to do it on their own, and then there’s a middle third, I think, that’s like, “I want a little bit of help, but I kind of want to save money and not spend too much on help. And I don’t trust enough.” It’s really trust. It’s like, “I don’t quite trust enough to turn it over.” And that’s a harder market to help, because no one really wants to be in business to do, “Sure. I’m going to build up a staff of 40 people to just schedule one hour appointments to talk to people about isolated questions.” It’s not very profitable. It’s a hard business to be in.

Sunny Pahouja: It is. And, quite frankly, if you look at the last 10 years, things have been kind of easy because the market dropped so much that if anyone put money into it, and they just let it ride in an index fund, or ETFs, or even some individual stocks that have just massively performed, it was pretty easy to make money.

Sunny Pahouja: Then, volatility happened, and especially this year, it’s been a pretty volatile market. That’s when people are like, “Man, this is just getting out of control. Some days I’m seeing my portfolio drop 20-30 grand, but next day it’s up 10-15 grand.”

Sunny Pahouja: It’s just one of those things where, now they’re trying to figure out what do they do in this kind of environment where markets are dropping. Do you keep putting money in, or do you stop? That’s where all the confusion comes in. And I think, personally, for me, it’s kind of that same thing where you’ve got all this volatility in the market and it’s hard to figure out what to do next, because you don’t know.

Sunny Pahouja: Sometimes it’s Tweets you’re reading, sometimes it’s charts and all that kind of stuff. People that believe in the whole charts and that kind of stuff, they can see where the markets are headed. And people that believe in the fundamentals, they’re like, “Man, some of these stocks, some of these funds are so cheap because the market’s dropped so much because of all the trade war worries, and whatever geopolitical stuff that’s going on in the markets.” It’s kind of hard to determine for most of the people because I think … And I can’t tell you how many questions I got just on, “Can you tell me a little bit about what this trade war is about? I don’t even-”

Reese Harper: Yeah, just generally. What is a trade war? Yeah. Well, this morning, the whole Dow moved because of a Tweet, today. Right? It was a Tweet move. Right? And all of these ways that people, that’s the beauty of a market is all of these people with different ideas, and different views, and different innovation skills, they’re all just chattering, and pining, and throwing their ideas at the wall.

Reese Harper: And, to me, that’s the beauty of capitalism. The reason the broad market, the overall global, if you take all 14,000 stocks in the whole world and you just say, “Why do they always go up on average at, on average, close to 10% a year? Why does that happen on average all the time?” No other asset really goes up that much every year. It’s not predictable on an annual basis, but it’s amazing to watch the world just continue to grow, and create, and build.

Sunny Pahouja: At the end of the day, for a majority of the people, what they really want is taking on reasonable level of risk and getting a reasonable return. We’re not looking 30, 40, 50% returns in a year. I mean, there are some people that claim they get that, but more power to them.

Reese Harper: It’s over isolated short periods, typically. And sometimes they exaggerate.

Sunny Pahouja: At the end of the day, if you are saving a decent amount of money each year, putting that money into some kind of investment, taking on reasonable risk, and getting a reasonable return, you’re going to do well in retirement. There’s no doubt. I think a lot of us had this fear of either starting too late, or the big one right now is actually not taking enough risk.

Sunny Pahouja: I truly come across so many people that feel like that they have saved up so much cash, and they have missed out on this huge market run-up, and then they’re like, “What do we do next?” I mean, things look so shaky, we have no idea what’s going on with the markets, and based on the market movements, sometimes it’s up 500 points, the next it’s down 800 points. It’s like, “What do you do now?” And I think that’s where we need some guidance.

Reese Harper: One of the things I wanted to hear you talk about is, how do you navigate the world of financial advisors? When we’re talking about the possibility of someone benefiting from working with someone, how do you navigate that? Because I see that, I get that question all the time. And I really, honestly, don’t think we’re the only good option. And I really try to, I’ve written a couple white-papers on this that I really feel like are objective.

Reese Harper: But I think it’s really hard for people, and my opinion comes across biased no matter what because I am a financial advisor. They’re like, “I don’t-” Even if I try to sound objective, they’re a little bit, they’re wondering if, somehow, I have an agenda. I’m curious how you help people navigate those choices.

Sunny Pahouja: This is kind of my opinion on it. I tell people, look, some of that has to be your gut feeling. You start talking to an advisor, you ask a lot of questions, you listen carefully to their answers, and see what their goals are for you. And then some of that is just that gut feeling. What are feeling about them once you’re done talking to them? Is it all about them, or is it all about you? Is it all about their client?

Sunny Pahouja: At the end of the day, when you talk to someone and they’re trying to maybe push you into a specific kind of product or service, you might think, okay, that there is an agenda that’s going to benefit them, than an agenda that’s going to benefit you as the client. For me, I feel like it really depends on, what is it that they want you to do? If you said, the more money you have with them, the more they can potentially make. Correct?

Reese Harper: Yep.

Sunny Pahouja: At the end of the day, do they have your best interests? And, honestly, it’s hard. I mean, there’s no right or wrong answer sometimes because you can trust someone and still get screwed. But, majority of the time, it’s one of those things where you interview the person, get the answers you’re looking for, obviously talk with your spouse, talk with your partner, and figure out, “Is this going to make sense for me? Is this going to make sense for me and my family?”

Sunny Pahouja: And if it does, you move forward with that person. And you look at their reputation, and you look at their credentials. I mean, are they, do they know what they’re talking about? Do they know? You ask them questions. Are they sounding defensive? Or are they on your side? Are they wanting to help you get onto the investments that you’re asking about?

Sunny Pahouja: Or one of the best things, one of the best advice that I got early on was, if you bring up an investment idea to me, my job is to actually talk you out of it. And the reason is because I’m going to try to find any and every reason why you shouldn’t invest in it so you can convince me why you should, because that way, I’m going to give you all the negatives behind why you shouldn’t, and maybe that kind of opens up your eyes.

Sunny Pahouja: Because what happens is, as investors, when we bring up an idea to our CPA or attorney, to our financial advisor, their job is to analyze the investment, “Is it a good fit for my client?” And as an investor, you’re already convinced that you want to invest in it. You have this preconceived bias that you want to put your money into this thing, and you’re just basically kind of looking for that yes.

Reese Harper: You’re looking for a confirmation bias from that person.

Sunny Pahouja: Yeah. What you’re looking for, what you’re looking from that advisor is to maybe find reasons why it could be a bad idea.

Reese Harper: Yeah. That’s a really important piece of advice, man. And my best clients are the ones that kick me the email with the private placement memorandum, or the investment, and say, “Look. You know I already want to do this, but tell me why I shouldn’t.” Right? And it’s not my job as an advisor to confirm that it’s a great thing unless it really truly is. Most of the time, my job is to find the reasons why it might blow up on you.

Reese Harper: But the challenge is, sometimes, I feel like an obligation to also advocate for a particular investment. Once in a while, I’m like, “It’s not my job just to be the no-man all the time.” I can’t just be like, “Everything’s a no.” But it is very uncommon that I’ll actually endorse something, because there’s just, most people get, especially if it’s not in the public market.

Sunny Pahouja: Right. You brought up a good point. I mean, just this week, you had a post about someone that you were interviewing as a new client. Correct?

Reese Harper: Yeah. They were onboarding. We took on all of their documentation, and reviewed everything, and audited them as a new client.

Sunny Pahouja: Yeah. And you found out that part of their investment was in something that wasn’t even an investment, it was some kind of loan or something, or?

Reese Harper: Well, it was a very large six-figure check that they thought they had invested in the public market, but it was actually cashed by their investment advisor and placed into the investment advisors bank account and spent. And then when we kind of brought it up, the investment advisor was very flustered and scared, and told the client that it was a loan, and that he’ll pay it back soon.

Reese Harper: But this was not, this has happened years ago, and we’re barely uncovering it at this point. And there’s a lot of ways to have avoided that. One of them is, never write a check out to … You’d never want to write a check out to the name of another individual person without significant scrutiny. A third-party custodian should always be holding the money, and not your advisor. This particular investment that the client thought was transparent, the check was actually written out to the investment advisor directly in the name of his business. That’s never the right direction to go.

Sunny Pahouja: That’s a great tip, actually, because I think I would want everyone to hear that one more time. Just tell me one more time, you’d never want to write a check out to the company or the advisor, personally. Correct?

Reese Harper: Ever. Never. The check needs to be written out to a third-party that is not related to the advisor, meaning Fidelity, TD Ameritrade, Charles Schwab, Interactive Brokers, any custodian. Bank of America, Merrill Lynch. The third-party custodian, ideally, is not related to the advisor. They don’t have a financial or an ownership relationship at all, they just have a business relationship.

Reese Harper: You write the check out to TD Ameritrade, and I can trade in your account, in your name, but I could never take the money out of your account and put it in my account, because it’s only in your name. As long as you keep the money in your name, in an account in your name, you’re never really going to have these … I mean, there’s always cases of extreme cases I could share with you where that’s still one in a thousand cases where you could still find a way, a very sophisticated person, could find a way to set up a bank account in your name and fake it.

Reese Harper: But there are a lot of controls that a third-party custodian protects an investor from. But when it comes to private investments and private placements, or private investments in a piece of real-estate, or in a startup business, or a venture capital business, or in some cases, hedge-funds. Those are often checks that get written to the corporation, because you’re buying equity in the business.

Reese Harper: But in most cases, the most sophisticated ones will allow you to write the check to a third-party, and then have the third-party redirect the funds into the investment and track that the accounting of that investment is being done properly. Some hedge-funds and private placements that I’ve invested in, and helped clients invest in, the custodian, Fidelity or TD Ameritrade, will still take the money, redirect it to the investment, and then track the performance of that private investment through a third-party account. And that’s just super professional. That’s the most sophisticated way to invest, even privately. But you should never be writing a check to a person, ever.

Sunny Pahouja: That’s a great tip, actually. Because I think, in this type of world, there are so many scams out there, and it’s happening every single day. I mean, from private investments, to real-estate, to these hedge-funds, and private equity, and all that kind of stuff. It’s happening all over the place, and it’s sad, man. When someone loses a lot of their life savings over something like that, I mean, it’s just-

Reese Harper: I mean, it’s just super sad. And most of this, let’s say it’s a hundred thousand dollars, for most people, to accumulate a hundred thousand dollars after taxes, right? After tax, it’s several years of work. Sometimes, three to four years of work for people. It’s five years of your life for the average dentist. Even a hundred thousand, it could represent. Because, I mean, after tax money is always the place where this stuff happens, and it hardly ever happens inside of a 401K or a qualified plan. It’s always this after tax money, and that is really hard money to accumulate. It’s very difficult to get that money.

Sunny Pahouja: Yeah. It sucks, but I mean, I think that’s where you’ve got to do your due diligence. I mean, you really got to dig deeper, and it’s not just about trusting the person, but also doing a little bit of research and just making sure of what you’re putting your money in.

Sunny Pahouja: Of course, the other thing with the public markets, there is a little bit more transparency, but even then, stuff happens. I mean, look at what happened to Enra, and there was that report about GE recently. Things like that can happen in the public market, but with very, very little chance, as opposed to the private markets. I mean, it’s more likely to happen, but I think that’s where you really have to kind of work with someone that you can trust, and can really kind of do the due diligence for you, and have a team of people that are looking out for you. I think that’s where it does make sense to pay for advice that is going to not have you lose hundreds of thousands of dollars.

Reese Harper: Yeah. Booking a free consultation is super easy, so why haven’t you done it yet? Just call 833-DDS-PLAN, or go to dentistadvisors.com and click Book a Free Consultation. You can find a time on your calendar that works best for you, so why hesitate? We can help you take control of your financial future, and find out how by going to dentistadvisors.com today.

Reese Harper: I’m going to throw a few questions at you in that vain of how to sniff out an advisor. I want to see which ones you think are the most, or what you would say about these questions. How important is it that … How important is compensation in hiring an advisor? We talked earlier about these three different ways you can compensate an advisor. I’ve already shared my opinion, but I want your honest opinion on this topic. Is there a right and wrong way to compensate a financial advisor?

Sunny Pahouja: I think, in my opinion, first of all, I think a lot of people talk about finding someone that’s as cheap as possible. Right? And we kind of know that in dentistry, kind of like that thing about, you get what you pay for. At the end of the day, you want to find someone that knows what they’re doing. They’ve been in the business for a while, and they have the right credentials. And I get it that there’s … Sometimes people say credentials don’t mean much, but they do at the end of the day, because they’ve done their homework, they’ve done a lot of that research, they’ve done taken all the proper examinations to get to that step, which means they put in the effort to get where they are because of the time they’ve put in.

Sunny Pahouja: Compensation, I mean, it is very important. And for me, I think, to me, I feel like a combination of an advisory fee, a flat fee. Maybe we put our fee in as a per-project fee kind of thing, and then doing a percentage of your assets. Now, it would be nice, in the world where your advisor is kind of compensated on their performance, also. And some of those hedge-funds, they kind of get into that where they’re paid based on their performance, some of the private equity gets like that.

Sunny Pahouja: I think having a world where they’re compensated fairly for doing the work that they’re doing for you is extremely important, because that makes them work harder for you. As a dentist, if I feel like I’m not getting compensated properly for the services, for the procedures I do for my patients, I’m not going to be as happy as if I feel like I’m properly compensated for what I know.

Sunny Pahouja: Because at the end of the day, there are good dentists, there are bad dentists, and there are people that take a lot of CE, but invest a lot of money. And then they’re translating that skillset onto their patients, versus people that might not be putting any money into some kind of CE, and are chugging along doing fine, but at the same time, they can’t expect to make a lot of money if they’re not knowledgeable enough about the services that they’re providing. It kind of goes hand-in-hand with that mindset.

Reese Harper: I think this is an important thing to pause on and just talk about for a second, because I think the assumption, it kind of started with John Bogle, and Vanguard in the 70s and 80s, saying, “You shouldn’t hire a financial advisor because you could just invest in the market, eliminate an advisor, and then just get the market return.” That’s going to be higher than what you could make if you hire someone to try to make you get more money, like an active manager or something.

Reese Harper: There’s a lot of confusion around this topic, tons. Because some financial advisors like me are saying, “I’m not getting paid a percentage on your account to make it outperform the market, I’m getting paid a percentage to do all of these financial planning jobs for you.” I’m meeting with your state planning attorney, I’m helping review your tax returns, I’m looking at your data, refinancing your data.

Reese Harper: I’m doing all of these jobs, and you may not want me to do them all, but the clients that hire us are saying, “In exchange for you basically making sure my index portfolios are perfectly dialed in, I want to pay for my financial planning through a percentage on my accounts.”

Reese Harper: But most people think that they’re paying you a percentage so you an make their accounts get way bigger than they could get on their own. That’s partially true. Vanguard’s research now shows that most financial advisors can add, the right financial advisor, can actually add returns to your account beyond what the average person does on their own. But I think there’s this misconception a little bit that, I’ve seen it sometimes in dental investment group, you see a post. It’d be like, “It’s worth paying a financial advisor a percentage because he can actively trade your account and make it grow more than the market.” And I feel like that there’s a lot of confusion around, “Why would I pay a percentage on my account to someone?” Can you kind of respond to that? I just want to hear your reaction to that.

Sunny Pahouja: Yeah. I mean, I don’t think it’s necessarily, you’re trying to outperform the market every single year. But what about those down years where you need that advice on curtailing how much downside risk you’re going to take. And again, I think you talked about the comprehensive review of your overall assets. I think that’s what the key is. Reviewing the tax returns, reviewing what kind of returns you’ve been getting, what kind of returns are expected, what your age is.

Sunny Pahouja: And then what about all these other kind of funds out there, right? I mean, backdoor raw diaries. I mean, there’s still so many people out there that don’t know how to do that, or don’t kind of, they want to set it up, but they just don’t have the know-how on how to get started with some of that stuff. And some of that stuff, like I said, it needs to have that comprehensive review. Because people, we talked about state planning, right? What about when you get into your 40s and 50s? I mean, should you be looking at long-term care investment? I mean, think about it from that standpoint.

Reese Harper: Well, yeah. Yeah, and for me, that’s what-[crosstalk 00:31:12]

Sunny Pahouja: [inaudible 00:31:12] history of some disease that you know that you’re going to be spending more money in the future for healthcare than someone that is very healthy. You’re statistically kind of taking that chance, and you’re planning for that future. But the problem is, just by putting your money into some kind of index fund, it doesn’t guarantee that you’re going to be ready for all those steps in the future.

Sunny Pahouja: By having that comprehensive review, it really kind of allows you to talk to someone, bounce ideas off of them, and figure out, “What kind of accounts should I be in? What about real-estate?” All of that kind of stuff. Some people can be really savvy with real-estate, some people want to have nothing to do with it at all.

Reese Harper: Totally.

Sunny Pahouja: And it’s not just about how much money one has to invest, but it’s like, what do you do with that money, and what kind of asset classes do you put your money into? Here, it’s that easy to just put them in index funds, and someone says, “Hey, I’m 60 years old and I’ve got 100% of my money in S&P 500.” That might not be the right thing for them. But the market says, “Hey, you can earn 10% a year in the market, in the S&P 500, so just keep doing that.” But that’s not right, though, for somebody that’s in their 60s.

Reese Harper: Yeah. Yeah, I think to the degree that you’re paying any kind of fee on your investment account, of any kind of percentage, you should just be getting a lot of time back from your advisor. If you’re going to do that, because Betterment, Wealthfront, Robinhood. You can trade for free right now, and you can get good index funds and good index portfolios for not any fee, really.

Reese Harper: Fidelity’s paying you now, almost. They’re crediting you. There’s no expense rations in their ATFs, and so the market for just getting cheap index funds and investing is it’s going to zero. There is no value in a broker intermediary just getting you funds anymore, in my view. And I think that most people don’t realize that sometimes the benefit of hiring any professional advisor is the, we’ll call it free advice, you get on to other topics, especially when you’re hiring a specialist.

Reese Harper: If I hire a specialist attorney that has a lot of experience doing transitions, sometimes he’ll give me the most interesting business advice, or overhead advice, or management tip, or supply chain recommendation just because he’s in the industry. But it’s not what you paid him for, but man, he just knows a lot about your career path. And, man, I feel like that people sometimes underestimate the value of that. I think, generally, people are just less likely to … people are too slow to hire a lot of good advisors. The right attorney, the right CPA, the right financial advisor, the right consultant, the right shrink, the right personal coach. Therapist, there’s a lot of good resources that really can just change your life.

Sunny Pahouja: Yeah, absolutely. And I think, honestly, I think one of the worst advice that, we as individuals, give people is, “Oh, you’re too young. Don’t worry about hiring a specialist for this or that. Don’t worry about hiring a financial advisor. You don’t have enough money.”

Reese Harper: Money yet, yeah.

Sunny Pahouja: “You’re just a W2.” And unfortunately, that’s not the case. I mean, you’ve got to know what you’re doing early on to have more of that financial independence later on in life. It doesn’t mean that you’ve got to be, you’ve got to have half a million dollars in savings before you hire someone. You can hire someone relatively cheap.

Sunny Pahouja: You don’t have to spend a lot of money, because that advisor’s going to understand that, “This is what you make.” The advice that they’re giving you is limited in nature based on what their financial conditions are, so they’re not going to charge you as much as opposed to someone that has a much more complicated situation where maybe they have multiple practices, maybe where they have a lot of real-estate, maybe they have a lot of different kind of accounts and that kind of stuff. That is a more complicated approach.

Reese Harper: Totally, man. Yeah.

Sunny Pahouja: It’s just one of those things where I think people can benefit at any level, and we just don’t take advantage of that sometimes.

Reese Harper: I was taught, I went through my masters program in finance, and one of the classes I took was … Well, I took two classes in venture capital, and the professor there really influenced me a lot, and he said, “The most successful entrepreneurs are the ones that reach out for advice the most frequently to the best people.”

Reese Harper: And I really took that to heart, and I thought, you know what? I’m never going to assume I’m right. I’m going to always ask for multiple opinions on any strategic thing I’m thinking about doing. I’m going to get a financial advisor. I’m going to get the right attorney. I’m going to get multiple attorneys that I use in select circumstances. I’m going to get the right CPA. I’m going to make sure I have the right consultant, the right therapist, the right personal health advisor, the right nutritionist, the right doctor, the right dentist.

Sunny Pahouja: Hey, having a good advisor is like having a good financial CE.

Reese Harper: Yeah, it is.

Sunny Pahouja: You put money into a clinical CE, you got to put money into a financial CE.

Reese Harper: Yeah, man. Just love your dentist and pay him well. Okay, me and you, we got to do a series together. You’re so much fun for me to talk to. I’ll let you leave everyone with the last word today.

Sunny Pahouja: Me?

Reese Harper: Yeah, you leave everyone with the last word.

Sunny Pahouja: Here’s may thing for people. We have this wonderful group that has a lot of smart people, but I still see that there is a lot of confusion on how, really, people want to approach their financial help. I think it’s wise for each and every one of us to really evaluate and figure out if getting in-touch with someone about their financial help is a good idea for them. And I think the answer, technically, should be for a hundred percent of us, it’s a good idea, because we can all use an independent voice, independent opinion, on how we should approach our financial help.

Sunny Pahouja: It is important, because when you get from 20 to 30s, 30s to 40s, so on and so forth, and you turn 56 years old, 60 years old, and you realize that, “I don’t have enough saved up.” That sucks. I mean, that’s a crappy feeling in the world, and I get that. I get those messages all the time. “I am in my 50s, I’m in my 60s, and I still find myself that I’m going to have to be working until 70, 80 years old sometimes.” And that’s a bad feeling to have. When you’ve got other people saying, “Oh, man. I’m going to be 40 years old tomorrow. I’m retiring.” Kind of thing.

Reese Harper: Yeah. They’re going to be living in Costa Rica, and maybe in a canoe, but they are retired at 34. Yeah, I just appreciate all that you’re doing. You don’t have to do this. You’re dedicating a lot of time to really improving financial literacy because you see a need, and I mean, I’m sure it’s … I’m not saying there’s no … I just feel like it’s a labor of love in a lot of ways.

Reese Harper: A lot of educators don’t get paid for the education they do, at least not to the, as we know, a lot of our school teachers and even college professors, they’re the most capable and given the most, but sometimes they don’t get compensated for all that teaching. They just do it because they love it, and I feel like I spend a lot of my time educating because I love education, and I feel like you do the same, and I so appreciate all the time you spend.

Sunny Pahouja: And I appreciate all the members and responses, because I get a lot of feedback myself, and I’m thinking, “If I can implement this in my practice, or in my life, I could be doing better.” And it’s, I think in the last two years, my approach has changed a lot. I’ll say I’ve been talking to you for a while, and I’ve been talking to some other people that are super smart in their businesses and what they do, so getting all that feedback and being able to implement that in your life is such a blessing.

Sunny Pahouja: I feel good about what I do. I practice dentistry full time. I don’t plan on making this my full-time career by any means, but it’s just so much fun collaborating with people like yourself that are out there helping dentists daily, day in and day out, putting a lot of time and effort into this. And at the end of the day, that’s your primary job, and you should get compensated for all the work you do. I mean, it’s the fair thing to do. I do appreciate everything you do, because I think you open a lot of eyes when it comes to some of the weird crappy stuff that goes on out there.

Sunny Pahouja: And it sucks because, I’m telling you, if I were to go over some of these messages and some of those stories I read, it’s kind of sad that, either, they didn’t get started early, or they are in this predicament because they didn’t take the steps to kind of get ready for it. On the other hand, even people that feel down that they’re 50 years old, it’s never too late to start, either. I think it’s the key is, that it’s not that you have to be young to get started, you can be any age to get started and really kind of turn things around and be comfortable.

Reese Harper: Yeah. I believe that, man. I don’t personally feel like success in life is based on how much you accumulate, and how much money you end up having, what your net-worth is. I don’t correlate net-worth with intellectual capability or smartness. I just think sometimes people just get lucky and are super wealthy, and sometimes people just have bad luck and they really struggle with their money.

Reese Harper: And I don’t want to say there’s no correlation, but you can really be happy with your financial situation within a very short period of time. A lot of it has to do with just setting some basic things up that make you feel like you’ve got some liquidity, you can relieve pressure, you can spend money on some fun things, but also that you’re actually accumulating and saving. The state of just being financially healthy is more important than getting to this five million dollar net-worth that you want to hit. You just need to get in the state of being fit. If you want to get fit in the gym, it’s hard, it’s really hard, but even if you’re super overweight and struggling, within a short period of time, you can get to a place where your physical conditioning makes you feel a lot better.

Reese Harper: It doesn’t mean you’re winning world record competitions, but you’re just feeling better. And I feel like finance is the same way, man. You get into this zone of, “I’m exhibiting good behavior, and I’m in control. I’m organized. I’m moving in the right direction.” That’s enough. If that’s all it is your whole life, and you never are uber wealthy, it’s still such a good feeling, and I just want everyone to get to that point.

Sunny Pahouja: Yeah. It is a process, and I think the biggest issue with a lot of us is that we just don’t get started with that process. Sometimes you just got to say, “Hey, this is it.” It’s kind of like making that New Years resolution. We say, “Hey, we’re going to do this.” And then we just never get started with that. And that’s where you-

Reese Harper: And that’s why I’m still in business, Sunny. It’s just like, at the end of the day, I’m the guy that’ll finally mow your lawn if you’re just struggling to get around to it. All right? Anyway, well thank you so much for taking all your time. I wanted to compliment you on one more thing. I think it’s amazing how you’re able to maintain a really positive tone in a group that is pretty diverse in terms of it’s personalities. I feel like you do a really good job of being a good diplomat in a very diverse group of opinions. Some strong ones, too.

Sunny Pahouja: I need to learn how to deal with the political.

Reese Harper: Yeah, dude. You’re doing great. Well, keep it up. I look forward to doing it again soon, and thank you much for all your time.

Sunny Pahouja: All right. We’ll talk soon, thanks for having me.

Advisors, Investing