Snap Decisions that Create Money Troubles – Episode #351

Outside sources are constantly bombarding our brains with a barrage of information intended to influence us to make snap decisions. Unfortunately, when it comes to your money, quick decisions can have serious consequences.

On this Dentist Money™ Show, Ryan and Matt look at what can prevent you from making hasty choices that end up being detrimental to your financial health.

 

 

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Podcast Transcript

Ryan Isaac:
Hello, everybody. Welcome back to another episode of the Dentist Money Show brought to you by Dentist Advisors, a no commission, fiduciary, dental-specific financial advisor just for dentists all over the country. Check us out at dentistadvisors.com. Today on the show, Matt and I are talking about drug abuse in the Vietnam war, environments and how to structure your financial decision-making environment in a healthier way so that you can make better financial decisions throughout your career and beyond into retirement. We’d love to help you make better financial decisions. Many thanks to Matt for writing this cool article and a little bit of history there and telling some stories with us today, and many thanks to you for being here and joining us on another episode, we appreciate it. If you have any questions for us, you can always go to dentistadvisors.com. Click the “Book free consultation” link and schedule a chat with one of our advisors. We’d love to talk with you and help shape your decision-making environment today. Thanks for being here, everybody. Enjoy the show.

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, Ryan Isaac.

Ryan Isaac:
And welcome to the Dentist Money Show, where we help dentists make smart financial decisions and avoid the bad ones along the way. I’m your host, Ryan, and I’m here with Matt and it’s good to be back with you, Matt. It’s good to see you again, man. How are you doing?

Matt Mulcock:
You know, it’s great. It’s especially great, with that intro, to be here with you.

Ryan Isaac:
Yeah, just Matt. We’re excited to be here with just Matt and just Ryan, just two buddies; just two long-time friends.

Matt Mulcock:
Just two guys.

Ryan Isaac:
Just two guys, just…

Matt Mulcock:
Two guys hanging out.

Ryan Isaac:
Just chatting it up, talking money.

Matt Mulcock:
Yeah.

Ryan Isaac:
We’re excited to be here for you today. We’ve got a fun subject to talk about. This comes from Matt’s blog. And it’s called Money Matters, which is still the coolest name. Sorry, Jake. I just… It’s just… Money Matters.

Matt Mulcock:
Jake’s is good.

Ryan Isaac:
It is.

Matt Mulcock:
Jake’s is better content, so we’ll say mine might have the better title, but…

Ryan Isaac:
Jake’s been going longer and longevity counts for something, but…

Matt Mulcock:
Yes.

Ryan Isaac:
It’s just your name got snuck into the title, Money Matters. Super cool. But… Today, we’re gonna talk about this article that you wrote a couple weeks ago, right? I guess it’s been out for a couple weeks now.

Matt Mulcock:
Yeah. Yeah, a couple weeks. Yep.

Ryan Isaac:
And you can find this, by the way, in Matt’s blog, Money Matters. You can find it at dentistadvisors.com/something, Matt, or…

Matt Mulcock:
Sure, yeah.

Ryan Isaac:
Or substack.moneymatters.com, is that where it’s found?

Matt Mulcock:
It’s like just my name, mattmulcock.substack.com, yeah.

Ryan Isaac:
Oh, okay. [0:02:31.2] ____.

Matt Mulcock:
I haven’t gotten fancy with it yet.

Ryan Isaac:
Yeah, that’s fancy enough.

Matt Mulcock:
I don’t know how to do any of it. I just wanted an outlet for writing, so here we are.

Ryan Isaac:
Yeah. It’s beautiful. Well, you got a cool story that I wanna get into and I wanna tease a little bit that… It’s a big subject, because we’re talking about kind of the environments that dentists find themselves in and how they end up making financial decisions in these environments. And I’m reminded, like… I was out of town this last week, but I took a couple of calls that were like really big life decision calls. And these are things that happen weekly and monthly. And I know you can relate to this Matt, but sometimes, I get off those calls, and… You know, we end up talking through things, like sometimes, I have actually advice from experience that I can give. Sometimes, I’m just listening and just nodding and saying, “Yeah, your thinking is rational, and that’s a good process to make that decision,” or sometimes, I’m giving pushback based on something, right? But sometimes, I get off those calls and I’m like, “Man, what would this person do if we didn’t have that conversation?” And not because like, oh, it’s like I saved the day, but just the… Just like the sake of the conversation, just picking up the phone, walking through your line of thinking with somebody, having… Like, running it past someone and being like, “Am I crazy? Is this a rash decision, or is there some logic behind my process? Does this make sense?” I think it’s like therapy.

Matt Mulcock:
Is there another angle I should be thinking about, yeah.

Ryan Isaac:
Yeah, is there… Like, am I missing anything?

Matt Mulcock:
Is there a blind spot?

Ryan Isaac:
Have you seen this before? If so, am I missing anything? Totally, man, a blind spot. And I just think that process is… Even outside of money decisions, it’s so important to be in an environment where, when you’re trying to navigate big things in life… I mean, therapy is this way too. Like, you have a therapist, and you’re talking, and then they’ll stop you and ask you questions, I’m speaking from experience. And then they’ll question you and be like, “Well, what did you mean by that?” And then you start explaining yourself, and you’re like, “Well, that’s not… The story in my head’s not normal.”

[laughter]

Matt Mulcock:
Yeah. You’re like, “Wait a second.” Yeah.

Ryan Isaac:
Like, “Wait. Wait, I think this is a normal story in my head and it’s not normal,” and we make financial decisions the same way. We get feelings, we get emotions, we get greed, fear, we get caught up in FOMO with our friends, and… We start making financial decisions and if we don’t have a chance to… I don’t know, express those ideas in an environment that is gonna be productive for us, then… Man, sometimes, we just end up running off making decisions and purchases that can be kind of consequential and detrimental to us, so…

Matt Mulcock:
Yeah, for sure.

Ryan Isaac:
I think about this stuff a lot. I love this story. I’ll just give it to you. You kick us off with the story. It’s really fascinating how this works, but let’s just start… Let’s start there with the story for Money Matters.

Matt Mulcock:
Yeah, so basically, in the early 1970s, the US government White House officials were kinda freaking out. The Vietnam War was coming to an end and we were bringing back all the troops back to America, back to the normal life. And what they didn’t account for, outside of just the failed war, was the… Basically, the state in which the troops were coming home, right? So if you look at numbers of the troops going out, about 1% were… Would be considered heavy drug users.

Ryan Isaac:
When they left?

Matt Mulcock:
So… When they left.

Ryan Isaac:
Or like… Okay, so…

Matt Mulcock:
When they left for the war like five or six years before, right.

Ryan Isaac:
So 1% of the people who left…

Matt Mulcock:
Of the pop… Yep.

Ryan Isaac:
To war, about 1% of them would be considered heavy drug users.

Matt Mulcock:
Heavy drug users. So what they consider by that is like multiple times a week of drug use, heavy drug use, so like, you know, narcotics.

Ryan Isaac:
Some people are checking the list like, “Hey, Matt, can you explain heavy here, ’cause I’d like to really know… ”

Matt Mulcock:
I know, right? So what is… Yeah.

Ryan Isaac:
Three times a week?

Matt Mulcock:
I’m in the gray area. [laughter] I’m in the gray, heavy area, yeah.

Ryan Isaac:
What’s two times a week? Is that…

Matt Mulcock:
Yeah, [chuckle] exactly.

Ryan Isaac:
Yeah, okay.

Matt Mulcock:
So… So about 1% would again, be considered heavy drug users when they left to war, when they came back, about 20… So let’s see… 50%. So 50% of the troops, upon arriving in Vietnam, became heavy drug users.

Ryan Isaac:
From 1 to 50.

Matt Mulcock:
Yep.

Ryan Isaac:
It’s like a…

Matt Mulcock:
It’s like 50%.

Ryan Isaac:
Literally a 50 fold, a 50X increase in drug abuse, basically.

Matt Mulcock:
Yes. Yes. Yep. And not only that, so not only that, but it happened like very quickly. That was almost more of the scary…

Ryan Isaac:
And by the way, I’m not sure we blame them.

Matt Mulcock:
Well, no, so that’s kind of what I write about.

Ryan Isaac:
Okay. Okay. Yeah.

Matt Mulcock:
And this is the whole point of this is like, so within the first week, so almost a quarter of all the people that were using that hadn’t been using before. So 25% of them were using within the first week of arriving.

Ryan Isaac:
Oh, whoa.

Matt Mulcock:
Sixty percent were using within three months of arriving. So it didn’t, it’s not like this was like even a slow start.

Ryan Isaac:
Not at all. It was like an immediate.

Matt Mulcock:
It was like 99% of people that went out, the troops that went out were not using within months, the numbers skyrocketed…

Ryan Isaac:
Half of ’em.

Matt Mulcock:
To 50%. So it was kind of wild. And so to your point, so when they were… So then when they were coming back, this is the really interesting part, when they were coming back, of course, the White House officials, the government was kind of freaking out. They were thinking, crime is going up, you know, we’re not gonna be like, homelessness is gonna go up. Like all the things tied with heavy drug use. They’re really worried. They’re trying to… They’re sending out all these people to study this. So they start tracking these people, right? All these troops coming home and start trying to do this research to figure out what to do, what they’re gonna do. What they found is the problem basically took care of itself. So I’ll give you the numbers here. Within 12 months of returning back, the numbers went back to 1%. So the numbers basically reset back to where they were before the troops left.

Ryan Isaac:
Within oh, within 12 months of returning.

Matt Mulcock:
Within 12 months, basically yes.

Ryan Isaac:
Which is, it feels like equally as fast. And that actually feels faster kicking a drug habit than it would be starting a drug habit. That’s so fast.

Matt Mulcock:
And there are some stories that are out there. Some like anecdotal stories of like individual troops that went out again, no drug use, they went out, they came back and within literally a matter of months they were, they’d cut it like cold Turkey. They like pretty much completely stopped. And so what… So the government was like, “This is kind of unbelievable, how, they, there’s no… ” And with no intervention from the government, I mean like individually, I’m sure there was some intervention taken possibly, but pretty much what they determined was it was just simply the environment. It was, they went out to your point, you can’t really blame them, like these are their world completely changed.

Ryan Isaac:
Yeah, it’s the first thing I thought. Yep. Totally. That’s the first thing I thought, like what a wild circumstance these young kids got thrown into. And you can’t blame them, I guess, for trying to like have some escape or some comfort in it all, but the shocking thing is that it reversed itself. I mean, that’s completely shocking.

Matt Mulcock:
Yeah. Well, I think the number one factor is the accessibility of these drugs mainly narcotics in Vietnam at the time, was so much higher. And just regular use there so much higher and accessibility to these troops, compared to when they get home, they’re no longer around it. The stress levels come down. They’re not like in a life and death situation. They’re not trying to… Like, they’re just back to normal life. So again, just the power of your environment is kind of the whole essence of what I wrote about, of how that can impact your behavior.

Ryan Isaac:
Yeah, totally. Okay. So that, and then when you said that word accessibility, that actually kind of rings something that we’ll probably get into on how people’s spending habits are affected by accessibility, right? [laughter]

Matt Mulcock:
Yep. Yeah, for sure.

Ryan Isaac:
Okay. But to back this up then, so I don’t wanna steal the thunder from your article ’cause I’m looking at here…

Matt Mulcock:
Steal that thunder.

Ryan Isaac:
No, like you…

Matt Mulcock:
Thunder steal.

Ryan Isaac:
Tie this into, you did it beautifully. I don’t wanna make you read it, but like you tied this into financial decision making, which is what I was alluding to from some of these calls this past week that were just normal calls that we take as advisors all the time, where people are making life-altering decisions, but they’re doing it in a healthy environment. Like what’s the tie in that you made from that story to money decision making.

Matt Mulcock:
Yeah. So basically my whole point was we live in an environment now that is… With surrounded by companies and influences that are literally designed to like hack our human tendency to spend money. Right. Or to compare ourselves to others and which leads to spending money. So one of the examples I give there is Amazon, right? Amazon created a multibillion dollar company, multi, multi multibillion dollar company, basically off of one tactic, which is they created a seamless and frictionless buying environment. Like, that’s what Amazon pioneered. I’m not saying it was easy to get there. I’m saying the concept was really simple. They just basically said, “How do we remove as much friction as possible?” They were the ones who patented the one-click buy, right?

Ryan Isaac:
Dang you, one-click buy.

Matt Mulcock:
One click buy, dang you. I think their patent has now since come like expired. Right? So, but Amazon, Vegas, social media, like we are surrounded by an environment to get us to spend money, right? And so my whole point was we have to be aware of that number one, be aware of the power of our environment, give ourselves a break and give ourselves a little bit of grace to say, look, we are literally being bombarded by this at all times. And, but then secondly, create an environment yourself, like be aware and then create an environment yourself to kind of fight against that.

Ryan Isaac:
There’s a line towards the end of the article where you said alter the environment, fix the problem. And, it’s not gonna be very entertaining for me to just read this, but I’m just like, so tempted to read this right after that, you said it’s a constant…

Matt Mulcock:
Let’s go word for word.

Ryan Isaac:
Let me just read this article to the people here.

[laughter]

Ryan Isaac:
It’s a constant battle we’re facing with more tempting environments than ever before. Yeah. And then relying on willpower or motivation alone basically to make better financial decisions like that… That’s a perfect way to lose the battle is what you said.

Matt Mulcock:
The losing battle every time.

Ryan Isaac:
Yeah. Like, I’ll just like, I’ll have willpower. [laughter] I was just thinking this morning and I’m aging and I’m getting older and I need to start working on some diet issues. And I walked in the kitchen and my daughters had made a giant pan of brownies. And I just pounded that, you know, like there’s no such thing as willpower. I swear. It just doesn’t exist. Alter the environment, fix the problem. Let’s go with that for a second. Which is kind of what we want to like help people picture their frameworks.

Ryan Isaac:
There’s three things I wanna point out that we’ll… Let’s get to. Number one, it would be, what’s the typical money make… Money decision making environment that a normal dentist faces, right? Let’s talk about even someone who decides to get help with like in the financial services industry, what’s the typical environment in the financial services industry? And then finally, let’s end with a few tips on what’s a more healthy environment that a dentist can put themselves in? What does that mean? What does that look like exactly? So, first of all, let’s just kind of like go back and forth for a second, what are some aspects to the typical dentist financial decision making environment? I’ll start with… And this is why like… Well, this is one of the reasons why we decided to be a dental specific firm is because dentists have just very unique financial lives.

Ryan Isaac:
Even if you took a dentist and the dentist’s neighbor, and they had identical income and taxes and, you know, cash flow or whatever, just the fact that the average dentist is usually earning that from owning a business, with employees and the types of debt, the level of taxes, the amount of cash flow in spending, the types of insurances and the possible ways they can invest money, the constant ways that they can spend money, not only in the business, but personally and I think just that underlying… I’ll go back to it, that underlining… Underlying stress level of running a business. You know, so many dentists, they get into dentistry for the clinical side of it, they’re excellent clinicians, but there’s like no training on how to run 20 people and hire and fire and teach and train and mentor and lead, and also no marketing and the P&L and how to talk to your vendors and on and on and on, right? So my first thing for the typical dentist financial decision-making environment is an environment of like, I don’t wanna say chaos, but I think it can feel that way to people sometimes, you know?

Matt Mulcock:
Yeah.

Ryan Isaac:
It’s just…

Matt Mulcock:
I think, it’s a good way to put it.

Ryan Isaac:
It’s really robust, it’s very complex. There’s a lot of moving pieces and the moving pieces don’t have an end. Like there is no such thing when you own a business in dentistry. Like when I hit this point, then we’ll chill. Like, it just doesn’t… That doesn’t exist, because usually when you achieve those levels of success, you have more people that you’re working with. [laughter] And maybe more locations and more revenue and cash flow and more taxes and more debt.

Matt Mulcock:
Yeah right.

Ryan Isaac:
And so that’s my first thing. When I think of like, what’s the typical environment that the average dentist is making their decisions in. I will say it begins with a… An environment of like high complexity and what can feel like chaos. What would you add and say… Or add to that, or, or add to the list?

Matt Mulcock:
Yeah. So I’ll, I’ll piggyback off on that, a little bit and then add kind of a… My other… Or my environment. So I think, I think that’s spot on, I think they are… They do live in a world of chaos. Like, it’s not necessarily unique just to dentists, like meaning other professions, other people can have…

Ryan Isaac:
Totally.

Matt Mulcock:
Levels of chaos, but I… What you’re highlighting is there’s different factors, I think, that lead to a higher likelihood that dentists will have higher levels of chaos compared to their peers. So, which I think leads to stress, a high level of stress, a lot of times.

Ryan Isaac:
Totally.

Matt Mulcock:
Making decisions, what feels like out of desperation. Right? The other piece that I’ll add to this that I think happens, and maybe I will admit, maybe this is just because we only work with dentists. So maybe I’m just saying, I don’t think this applies… I know… Well, in fact, I know this doesn’t apply just to dentists, but I do think they have an environment of comparison that is maybe worse in dentistry, mainly because it’s a very connected… So everyone that works in dentistry and dentists know this, like, you’ve got your class that you graduated with, right? You’ve got people in your community, like the other dentists in your community.

Ryan Isaac:
Your Study club.

Matt Mulcock:
You’ve got mastermind groups, study clubs. You’ve got the podcast network.

Ryan Isaac:
And the Facebook group.

Matt Mulcock:
You’ve got Facebook groups, yeah. I think it leads to an environment of comparison and FOMO.

Ryan Isaac:
Totally. I think that’s totally right, yeah.

Matt Mulcock:
Yeah, in a lot of… Well once again, I think that’s human nature and just being in a connected world, period, but I think it happens a lot in dentistry, more than maybe other areas.

Ryan Isaac:
Dude I totally agree with that. And I’d be curious to get like feedback or even pushback on this. But I… My experience, what I’ve heard from people, from dentists, is that, what you said, it’s a very connected industry. It almost sometimes feels like a really small world, especially like in the smaller communities, right? But I’ve heard from dentists around the country in all kinds of places say that despite it being a very connected industry and sometimes feeling like a small world there’s also… There is this competitiveness where like, you totally don’t wanna share everything with your neighbor, you know? Like there’s almost this like holding back of, “Yeah, we’re cool, we’re friends, we’re in the study club,” but like, you know, like, “I really don’t want you to know what I’m doing. We’re not really gonna talk too much about business.” Like there’s still like a competitiveness and you know, like a greed and a fear kind of push-pull kind of context between, you know, you and other dentists in your community, even if you’re friends.

Matt Mulcock:
Totally. Yeah.

Ryan Isaac:
Because you kind of do compete for patients if you’re close by, I guess, you know? Or marketing strategies or whatever, and…

Matt Mulcock:
Or, how about maybe not even in your community, but going out to like, again, a Facebook group and you’re connected to dentists like all over the country.

Ryan Isaac:
Totally. Oh yeah.

Matt Mulcock:
And you’re… All you’re seeing… This is almost the worst part, is all you’re seeing… Like, let’s say, you’re following another dentist on Instagram, you live in an environment where you’re seeing little highlights, little snippets of their life, and you’re thinking, “Wait a second, why are they living such an amazing life and I’m struggling every day? I’m stressed.”

Ryan Isaac:
Why is, why Like… Yeah dude, who’s posting about the investments where they lost money in Facebook?

Matt Mulcock:
No, yeah.

Ryan Isaac:
But you go to the groups and everyone’s just like, posting the returns, they got on some like random Bitcoin thing. And you know, you’re like, “Oh, what, why am I… ”

Matt Mulcock:
Yep. Or not only that, like, you’re seeing them go on a vacation, which it just, it feels like they just went last week.

Ryan Isaac:
Yeah.

Matt Mulcock:
But really, it was six months ago but you just see their posts every so often.

Ryan Isaac:
Yes.

Matt Mulcock:
And you’re feeling like, “Man, they’re always on vacation, [0:19:39.2] ____ ”

Ryan Isaac:
“I’m working five days a week, they’re working two.”

Matt Mulcock:
Yeah like, “What are they doing, exactly?”

Ryan Isaac:
“My clinical schedule is insane. And I can’t get away from my practice or else this thing shuts down and no one gets paid and like that person’s leaving all the time. And what do they have?”

Matt Mulcock:
Exactly.

Ryan Isaac:
“Is it Associates, partners, more locations? Did they get bought out?” Yeah man.

Matt Mulcock:
Yeah.

Jess Reynolds:
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Jess Reynolds:
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Ryan Isaac:
Let’s use some examples, we won’t be specific with people. These are really, really common. Let’s say…

Matt Mulcock:
Give names, account numbers…

[laughter]

Ryan Isaac:
Start to give names and account numbers.

Matt Mulcock:
And pictures in the show notes.

Ryan Isaac:
It’s time to move the practice and I need a different location, right? So we have questions about, do I buy a building? Do I lease a building? Do I build a building from scratch? Do I become a landlord too when I move into my new place? Do I build so that I can have like four providers there or just me? That’s a pretty common decision that a dentist has to make like really an average normal typical decision. But that decision, well, man, it encompasses so many parts of your financial life. It’s not just a purchase of real estate. It’s not just a loan. It will affect your cash flow, and your taxes, and your savings rate, it’ll affect your net worth, it’ll affect your debt levels, it’ll affect the insurance coverages you have, it will totally affect the flow and operation of your business, and the people you have or don’t have and you’ll need. It’ll affect you maybe being a single doc of owning the whole thing to maybe now having associates or partners, and you gotta share equity and learn how to split that and incentivize [chuckle] and find the right people.

Ryan Isaac:
What I’m saying is most of the time when a dentist makes a decision, even if it feels small, I’m giving a big example obviously, but it usually touches on half a dozen or 10 different parts of their financial life. And because they’re busy, because their life can feel chaotic, because there’s so many moving pieces, and sometimes they do feel like under pressure, like you said, and rush to get things done and do things quickly. They can tend to make decisions in a vacuum, and make a decision on the building solely about like, let’s just say, they’re like it’s a good price, so I’m gonna do it.

Ryan Isaac:
It just dropped to $200,000 and because the tenants or the current owner is desperate and now I’m gonna take it. They’ll just take like one aspect of the decision and then just like roll with it without stopping to consider all the other pieces. But I don’t think it’s their fault that they don’t typically stop to consider the other pieces. I think it’s the nature of what we just listed. And if you don’t have, which we’re gonna talk about, this environment where you get to slow down and talk to someone who probably has more context, who has seen this decision play out multiple times, and where you can just talk out your logic and your process to somebody.

Ryan Isaac:
If you don’t have those things, you’ll just tend to rush a decision and just go with something. And I mean, that can be, if it’s a big decision, it can be catastrophic, huge. Especially when we’re talking about buildings and moving the practice and messing around toying with that. But it can be as small as starting to fund your kid’s college or should you, or shouldn’t you buy that little vacation condo, or should you go pay $50,000 to your student loan right now? Or should you put that $50,000 somewhere else? All of these decisions, they’re on a scale of smaller to bigger, but they just touch on so many pieces in their financial life that, because of the things we mentioned, the typical environment is like, that decision gets rushed and the context isn’t taken into account when making that decision. And that can be a big problem. Anything else you would add about that environment of the typical dentist, I mean, there’s probably so many little things you could say about but…

Matt Mulcock:
I have one more that I think it’s pretty big, the… Dentists live in an environment of being targeted, right? You hear there’s a dentist here or you hear someone who is a dentist. People know that generally speaking, even if you don’t know the numbers, you know, oh, dentist, you think high income, right?

Ryan Isaac:
Yeah. Cash flow, income, wealth, yep.

Matt Mulcock:
Cash flow, income, exactly. And they’re targeted by people clamoring to make them feel like because they have a high income, they need a special, more sophisticated, complicated, let’s put in parenthesis, super expensive solution. That’s not… They want to be like, oh, you need to feel special because you make more money than everyone else. There’s people clamoring to target them on those six and seven products.

Ryan Isaac:
It’s a sales technique.

Matt Mulcock:
Sales technique, exactly.

Ryan Isaac:
It’s an emotional sales technique. Yeah.

Matt Mulcock:
Yep. Yep. Exactly. So I think that’s a huge one as well.

Ryan Isaac:
Well, you’re just highlighting the perfect segue. The other thing I was gonna mention, like kind of the second part of this is, we talked about the typical environment that the dentist operates in financially, but then even those who are reaching out to get help from somebody.

Matt Mulcock:
Oh, I totally cheated… I cheated.

Ryan Isaac:
No, there’s the segue. It was like moving right along.

Matt Mulcock:
Yeah. I was segue… I’m segueing away. Yeah.

Ryan Isaac:
You’re segueing away. There’s this environment of what’s the typical financial [chuckle] services industry environment? And you just said it, that the typical environment in financial services industry is sales, because that’s how it started. And that’s still to this day the most [chuckle] lucrative way to do it is, to find people who can buy your product and earn high commissions, and move on, and do that as fast and as many times as possible. So unfortunately, even when people do reach out or they’re, some of these times they’re not even reaching out, they’re reached out to, right? [chuckle]

Matt Mulcock:
Yeah.

Ryan Isaac:
Dentists don’t go looking for some of these, sometimes wild opportunities to spend money [chuckle], they get found. Like you said, they’re targets because they have cashflow and perceived high amounts of wealth. So the typical financial services… I even hate saying financial services, ’cause it’s not a service, it’s like a… It’s predatory.

Matt Mulcock:
Yeah.

Ryan Isaac:
It’s not a service, if you’re just seeking someone out, giving them an emotional pushy sale and then maybe hurting them in the process, that’s not a service, but…

Matt Mulcock:
Exactly.

Ryan Isaac:
That’s the typical, that’s a typical environment in the industry, heavy sales, product sales, high commissions, hidden fees, and just pushing things on people that they probably don’t, they don’t… Definitely don’t need, probably don’t want and for sure don’t understand.

Matt Mulcock:
Yeah, most of the stuff that’s… Most of the stuff that’s out there from a product standpoint, usually is being sold, not bought.

Ryan Isaac:
Yeah, so, yeah.

Matt Mulcock:
Right to your point, it’s like it’s being pushed on you as opposed to being received. Now, we’re not claiming that like any product is bad.

Ryan Isaac:
No, no. They’re needed.

Matt Mulcock:
Using… They’re needed like insurance, you need insurance, you need a broker or someone to sell you insurance, we don’t do that, but someone… But we work with brokers that do it. So there’s a need there, it’s just that it goes beyond that, right? And it goes beyond the base need to like, oh, let’s try to get you to do something different to make… To pad my pocket, that’s very, very common in the industry.

Ryan Isaac:
Totally. Well, it’s like most dentists are doing dentistry where they have a range of solutions depending on what the people’s actual clinical diagnosed problems are. In our industry, it’s a reverse, most financial sales people just have one solution. And it doesn’t really…

Matt Mulcock:
Yeah, they push it on everyone.

Ryan Isaac:
It doesn’t really matter what your problem is, they’ll turn your problem into a need for their one solution.

Matt Mulcock:
Oh yeah.

Ryan Isaac:
It would be like… Everyone probably knows of a dentist, it’s very, not the norm, it’s definitely the exception, but everyone knows a dentist who is just like over-diagnosing, pushing tons of dentistry product down, literally down people’s throats and…

Matt Mulcock:
Yep.

Ryan Isaac:
When it’s not necessary, and that’s rare in dentistry, because dentistry has such a higher level of integrity value in the way that they do business.

Matt Mulcock:
We wish it was rare in our…

Ryan Isaac:
We’re getting there.

Matt Mulcock:
Industry. Yeah.

Ryan Isaac:
We’re slowly, our…

Matt Mulcock:
Yeah, it’s getting better.

Ryan Isaac:
Our industry is pushing in that direction, it’ll take decades to really get over that hump, but that’s the other environment that dentists find themselves in that’s not exactly separate, like you led into that because it’s a natural, that’s what they deal with on top of all that complexity and stress and FOMO environment that they find themselves in, and all these multi-faceted decisions that they have to make that get rushed with lots of pressure and stress, they get outside pressure from being targeted to buy stuff from people.

Matt Mulcock:
Yep.

Ryan Isaac:
And spend money on stuff. And some of these people, I mean look, we’re probably painting like everyone’s a villain, some of these people aren’t villains, they’re well-meaning people, but they’re just excited about their thing, it could be a brother-in-law.

Matt Mulcock:
It could be.

Ryan Isaac:
It could be a neighbor, it could be a community friend, they have an agenda and they push it on the dentist who has the cash flow and that’s a dangerous thing when there’s an agenda plus cash flow and they meet, so that’s the tough thing. So the question that’s begged here, someone’s begging the question.

Matt Mulcock:
Someone is begging, someone is out there banging on the door…

Ryan Isaac:
This begs the question.

Matt Mulcock:
 Begging the question.

Ryan Isaac:
I’m like who’s begging the question.

Matt Mulcock:
They’re begging that.

Ryan Isaac:
I’m begging this question.

Matt Mulcock:
The people. The people are.

Ryan Isaac:
People are begging this question is, okay, so what’s a healthy environment then? If we’re pointing out the ones that, the reasons or the ways that these are not healthy environments and these are just typical, like this is just what’s happening by nature of being a dentist and owning a practice and a business, what is the healthy environment that’s not typical, that they kinda have to go out of their way to introduce into their lives. Like you were, I got your article, like you were saying, just about the willpower and motivation, you gotta add something else to that, you gotta add something to that. If you really wanna eat chicken and rice and broccoli three times today, and you’re saying by noon, typically that’s already out the window, which I relate to, the brownies are downstairs, then you have to introduce something in your environment that’s not typical, that doesn’t exist there. That probably adds a little friction to your process, ’cause if we’re saying to the beginning of your post about Amazon removing friction from buying, and that oftentimes is what our environments are trying to do to us, they’re trying to remove the friction from just spending money and making quick financial decisions, you know?

Matt Mulcock:
Yep.

Ryan Isaac:
It’s almost like you gotta put… Is it fair to say put friction back in?

Matt Mulcock:
Yes. 100%

Ryan Isaac:
Because I Feel… Okay, okay, that’s how I see it. You have to make, you Matt, for your chicken and rice today, you have to make a decision to put some friction back into your day, ’cause if it’s frictionless, you’ll just go the smoothest easiest route, which is brownies.

Matt Mulcock:
Well, exactly.

Ryan Isaac:
Brownies and are monsters.

Matt Mulcock:
And I think that sounds like a fantastic day by the way.

Ryan Isaac:
It sounds delicious by the way.

Matt Mulcock:
Sounds incredible. After this, I’m gonna go grab some. No, but it’s absolutely right. It’s like creating friction for the things that you want to, and so…

Ryan Isaac:
It sounds seems weird, right.

Matt Mulcock:
No it does…

Ryan Isaac:
Purposes put friction in your life that sounds like you don’t do that, you’re supposed to get rid of that.

Matt Mulcock:
But this is the whole idea of creating a system with friction in the right places and removing friction from other places, so for example, it’s kinda like flipping it on its head, right? Again, the entire system that we live in naturally, thanks to capitalism is designed again, to remove friction from things that they want us to… They, as in people trying to get our money, they are removing friction from the process, right, we need to re-introduce friction back into it.

Ryan Isaac:
In the right ways.

Matt Mulcock:
So what I said in the article is like, create road blocks for your temptation, and then the things that you’re trying to do as far as the good habits, make them more appealing, make them frictionless on the things that you’d want to like the things you actually want to be doing.

Ryan Isaac:
Okay, so three things come to my mind of positive friction to add back into your life, back into your financial decision-making life, and…

Ryan Isaac:
And I think it’s positive because friction slows things down. And I think more good decisions are made slower, like in a slow way. So I’ve got three in my mind. I’ll just start kind of putting them out there and then you add to this list. One of them like, for those that might be new to the podcast or our company, you can see what I’m talking about. If you go to dentistadvisors.com and go to the elements section. Elements is a framework we invented specifically for dentists to make more informed financial decisions. It’s a framework that separates a dentist’s financial life into 12 main important categories and uses data to kind of track progress in those categories and then gives us the data when we have to make a decision together that we can say, Well, what are the numbers telling us? This framework called elements. So one piece of friction that we add back in when someone chooses to hire us, is we say, okay, in order for this framework to work, we have to interact a certain amount of times per year, because I need data from you, like I need a new P&L, and a new tax return and an updated amortization schedule and a new statement from your new life insurance policy. And we need like updated bank account balances and real estate values and practice values and debts.

Ryan Isaac:
So a handful of times a year, we have to interact and we have to update those, which requires a conversation. And it’s not what you’d choose to do. I’m sure other people would rather go golfing or something than update financial. But introducing that, that’s one piece of friction I can think about. We built our whole business around that friction, right? Is let’s force some data conversations a handful of times a year to make sure that we’re making decisions with numbers and not emotions. So that’s one piece of friction like our whole business is built around. And again dentistadvisors.com, go to the elements section, you can see what I’m talking about. That’s one piece that was on the top of my mind. Anything you want to add to that at all?

Matt Mulcock:
Yeah, and I’d say on the back end of that, because to your point, the natural inclination is that people don’t necessarily always want to do that. They don’t always want to engage in regular conversations throughout the year about their money, like they just want to go golf or they want to spend time with their family. We totally get it. So we do everything we can on the back end to make it as easy as possible, to make it not be so… Make that friction not be so to the point where you’re not going to take action or you’re not going to talk to us. We’re not going to be able to get done what we need to get done. By building an environment, that will make it super easy. Obviously, something like technology, getting on Zoom, there’s technology we’re always investing in and doing or implementing to make it a really easy… As easy as possible.

Ryan Isaac:
Yeah, like you’re saying, we built an environment for ourselves to say, well, we can’t wait for a dentist to send us an amortization schedule or a P&L, just when they remember. We know they’re thinking about it, but they’re busy, right?

Matt Mulcock:
Exactly.

Ryan Isaac:
So yeah, we built ourselves an environment of people and technology to try to make that easier.

Matt Mulcock:
To make it easy, yeah.

Ryan Isaac:
Yeah, make it easier. Another thing that I think is a natural byproduct of this, and it’s actually the reason why this… All these, like, these data points end up getting done anyway is because it’s probably the most important offering that our firm, in my opinion, has, which is, we introduce an environment of another human being getting involved in your financial decision making conversations. And despite the technology… I think our tech’s cool. I think our processes are awesome. We’ve invented clearly some groundbreaking stuff for the industry, but I still think the best part of it, and the highest value, like no question, is just putting a human into a spot in your life where a human did not exist. So in the past when you would just go sign the lease on the new building or the LOI for the new practice and just be like the only person you’re talking to is the person selling it, selling you the practice or the building or the product. Now, there’s another human who’s not involved in the transaction. They’re not getting paid from that transaction. So they could say yes, they could say no, they could say, I don’t know. But we’re injecting a human into a part of your life that didn’t use to… So it’s like you wake up today and when your motivation starts fading at 11:00 AM and you’re craving the brownies and the monsters, there’s like suddenly…

Matt Mulcock:
It’s like 1:00 PM give me some credit.

Ryan Isaac:
Is it 1:00 PM?

Matt Mulcock:
Mine was like 11:00 AM. If there’s a human standing in your kitchen all of a sudden, and you’re like, Oh, hey, what are you doing here? And they’re like, Nothing, what are you doing here? And you’re like, “Well, I was gonna eat a brownie.” And then they’re like, Tell me about that.

Matt Mulcock:
Yeah.

Ryan Isaac:
They don’t say no. They’re not like, No brownie for you. Yeah, like, oh, cool. Why were you going to eat a brownie? Tell me about that. And then you’re like, I don’t know. I’m bored and it’s fast and… You know what I mean? And it makes me think, how many clients Matt does dentist advisors have out of our hundreds and hundreds of dentists that are actually like pretty smart financial decision making people, pretty good investors.

Matt Mulcock:
I know a lot of them, yeah.

Ryan Isaac:
We have a lot of clients who were investing really well on their own before that we became their investment advisor? Well, why did we become their investment advisor? Because that friction, they wanted that friction because when March of 2020 happened, like I have some clients and that were really smart, financially well-off people, good investors before we met. But we talked in March of 2020 and we’ve talked this year for context. Everyone knows March of 2020 and this year, middle of 2022, we’ve got a market that’s hit a bear market in the S&P and talks of recession and high interest rates. I’m the friction that even these smart investors are… They’re calling me because that’s just some friction in their life that keeps them from being too emotional about things or going off track on something that they know they shouldn’t go off track on.

Matt Mulcock:
So that is such a good example. You just use this comparison, right? You are option A, a click away from letting your emotions taking advantage of you, right?

Ryan Isaac:
Yeah.

Matt Mulcock:
In the heat of the moment, you’re one click away if you have… If you are what we call a retail investor, right?

Ryan Isaac:
Yeah so, yeah.

Matt Mulcock:
There’s no… You could just sell everything in your account in literally one click. You could do your face ID on your iPhone and you’re in your app and click and you’ve sold everything. What you’re saying is the friction that is there of like, I have to go through someone to make that decision.

Ryan Isaac:
Yeah.

Matt Mulcock:
That to me, is one of…

Ryan Isaac:
And I’ll do it. I’ll push sell… If they want to sell, I’ll push sell.

Matt Mulcock:
Of course.

Ryan Isaac:
I mean, it’s their money, but a conversation happened, yeah.

Matt Mulcock:
They have to either have a conversation, send an email. They’ve got to stop and think, I’ve got to contact Ryan, I’ve got to contact Matt. They… I know they’re gonna yell at me because they always do. Right?

Ryan Isaac:
Which isn’t true. [laughter] Yeah, that’s not true.

Matt Mulcock:
I’m kidding people. I would never yell at you. But again, it creates to your point that friction and it’s just that moment of being like, before I click the sell, I actually have to send an email, that alone a lot of times I think saves people.

Ryan Isaac:
It does. I mean, this it has happened more times than I can even realize. And when you get on the phone, you get the email, just the act of typing it out or saying it out loud like, “I’m really scared. Everyone’s telling me to sell my investments and wait.” Half the time they just say that out loud. And they’re like, “Yeah. But that’s not the right thing to do.” You know?

Matt Mulcock:
Yeah. [laughter] Yeah, yeah.

Ryan Isaac:
I didn’t say anything. I’m like, “Yeah, Okay.” And we can talk through it. The friction of another human in your life, I think is hands down, not even close to the most valuable thing about having a financial advisor that you’ll ever have. Technology, systems, reports, processes, those come and go, they change, they’re… The tools.

Matt Mulcock:
The investments strategy.

Ryan Isaac:
Yeah. Investments… Totally.

Matt Mulcock:
I’m not even gonna… I’m not despair. I think our investment strategy, Robbie at least so we know a legend, GOAT.

Ryan Isaac:
Yeah.

Matt Mulcock:
But even that it’s like, are we going to sit here and claim?

Ryan Isaac:
It’s just a tool.

Matt Mulcock:
Even Robbie is not gonna sit here and say, “We’ve reinvented the wheel. We’ve got some better mouse trap.”

Ryan Isaac:
No, no, no.

Matt Mulcock:
No, not at all.

Ryan Isaac:
Nope.

Matt Mulcock:
It’s the accountability. It’s that friction in the… It’s creating intentional friction where you need it.

Ryan Isaac:
The last thing I was gonna add was something you said earlier, it’s in your article about accessibility. And there is something about… Again, like all our client’s money that we manage for them, they could have it, we can click, ‘sell’, push it out to them, like, overnight it to them. Right? I mean it’s like they can have it fast. But the fact that it’s not sitting like debit card swipe-able, or even just like a simple spending strategy, just not having your money attached to a card or an account online that you can click and buy, having a step in between you and the money doesn’t mean someone’s… Doesn’t let you have it. It just means there’s an extra step, that’s kind of a pain, it’s kind of annoying. That alone is a barrier that can just make the total difference in so many situations. And I’ve… Man, you’ve seen it, I’ve seen it for years, like, repeated so many times, just having a little bit of a barrier of like, “Okay, my money’s in a brokerage account, and I can have a penalty for you, I can get it back out, that’s the beauty of a brokerage account. And I really want this boat. And I think I’m just gonna write a check and just get this boat.” But… And maybe that’s the right decision. Maybe you should write a check and get that. Maybe it is.

Matt Mulcock:
Yeah, could be.

Ryan Isaac:
But maybe it’s not. And the fact that you had to think about sending an email or calling Matt and going, “Kind of want to buy this $175,000 boat with cash. Can you send me the money?” Like, half the time that makes people go, “Actually, you know what, either I’m gonna do it a different way or I’m just gonna do this financing or something or I don’t need it.” Or they go, “I’m still… ” Or here’s the opposite of that. They’re feeling some tension, some anxiety about a purchase. That’s not… That’s just a luxury purchase. A boat, a vacation, whatever, a toy. And they call and then we’ve got some trepidation and they’re nervous. And they’re like, “I wanna spend this money. And you say, as an advisor, well, based on the data and our goals and our track record and because I know you and I’m the person that’s in your life, you should totally do that.”

Matt Mulcock:
Just to that point. What is the point of any of this?

Ryan Isaac:
Yeah, totally. Yeah.

Matt Mulcock:
If you’re not able to enjoy your money and that’s… We have these conversations more than you’d think, more than I think a lot of people even think is like… This just happened pretty recently to me, where I was like, “No, go do this. You can.”

Ryan Isaac:
Totally do it. You’re fine.

Matt Mulcock:
The whole conversation was me convincing them to go to do this big purchase. Yes.

Ryan Isaac:
To go spend some money. Go buy the thing that’s a depreciating asset, that’ll never be worth what you’re paying for today.

Matt Mulcock:
Go, do it. Yes. It’s a return on life, right?

Ryan Isaac:
And I love it. Yeah, I don’t… Return on life, ROL.

Matt Mulcock:
Yeah.

Ryan Isaac:
Thanks everyone for joining us today. This was a fun conversation, Matt. Thanks for writing the…

Matt Mulcock:
Yeah, it was great.

Ryan Isaac:
The piece and sharing with us all money matters. What’s it… Where do you find it again? What’s the…

Matt Mulcock:
Mattmulcock.substack.com. I gotta think of something better than that. That was just the standard one they gave me. But they’re also on the website.

Ryan Isaac:
It’s on the website. If you have any questions for us, if you wanna see what we were talking about with this framework, you wanna know what the friction of a financial advisor in your life would be like. You wanna have a chat with us about it, go to dentistadvisors.com, click the, book free consultation link, and let’s have a chat. Let’s talk about your life and how we can add a little bit more positive friction and help your decision making. Matt, thanks for being here. Appreciate it.

Matt Mulcock:
Yeah. Thanks, Ryan.

Ryan Isaac:
Thanks everyone for tuning in. We’ll catch you next time. On another episode of the Dentist Money Show, take care now, bye bye.

Behavioral Finance