Finding Orphaned 401(k)s: Beagle's Solution

[0:00] JD: If I told you guys that there's a Scotty Cameron shop in Encinita. [0:05] Chad: Oh, it's incredible. [0:06] JD: We walked. [0:07] Chad: We gotta look at the office. We walked by it. They wouldn't let us in though. [0:13] JD: Do you know what country club Scotty Cameron is a member of? [0:17] Chad: Oh boy. Let me guess. Acres Country Club in Bloomfield, Missouri. [0:24] JD: He is a member at my country club. And that is facts straight in headlines. Here we go. Guess what, all you conservative baby boomer, narrow minded crypto and 401k haters. You know who I'm talking to out there for us all. The company thinks you're dumb. Okay, they didn't really say that. But I can postulate, can't I? I can make up my own little scenarios here. My title for this article is for us all. Doubles down on crypto and 401k with a new coin desk deal. The peeps at 400k, Specialist magazine wrote it slightly different, but the concept here is these guys are doubling down on this. They're not stopping, they're moving forward. And now they've made a deal with CoinDesk, who I would argue is a big reputable brand name in crypto and. And they're doing something a little different here. And if the boys have read this or not. I don't know. Chad looks like a confident guy. Justin's shaking his head no. They've got an index type of offering, so this is a little different. So not just Bitcoin or Ethereum would you invest in, but they'll allow you to invest in this? Well, jd, you've got the article here on your computer. They will allow you to invest in what, like an index fund of all kinds of coins, right, Chad? [1:51] Chad: Yep. What do they call it? I've never heard the term that they used. I'm looking over now to figure out what it was. [1:57] Mark: I've heard it called penny constitute. [1:59] Chad: Constituents. [2:01] JD: Oh yeah. [2:02] Chad: Constituents. Is it really? That's not constituents. Is it underlying constituents or coins? Is it really constituents? I don't know how you spell constituents. That's a new one for me. How did you pronounce it? But yeah, constituents. [2:17] JD: I don't know how I'd honestly. Go ahead. You still have a thought. Keep going. [2:20] Chad: I mean, it doesn't change any of the thoughts we've had so far on the show. [2:24] Speaker D: Right. [2:24] Chad: Which is there could be a place for crypto in the retirement plan space. It needs to be a very small percentage that people are allowed to use, but I have no issue in having it as a. As a small Offering made available to how do you participants. [2:39] JD: Let's get past the hump here of having in a 4:1 case, let's assume it goes in. How do you feel about them being able to invest, say 5% or whatever small percentage in Bitcoin or Ethereum versus investing in something that's dispersed through, you know, what is it, 28 different coins? That kind of caught me off guard because I'm kind of. And I don't have any intelligence to back this up, but I'm not interested in dogecoin and whatever other coins that are out there. And so I was kind of concerned that I'm sure that they're thought this through prudently, but why do they need that exposure into these other 20. [3:23] Chad: Well, that we had a guest on a while back that kind of made a similar point. Like if you're going to get into crypto inside the retirement plan space, it should only be Bitcoin and it should be small slivers and percentages. And I agreed with that. And I agree with it primarily because there's still so much unknown in that decentralized world of cryptocurrencies that you hear some big names and then you don't hear about some names those same exact company or same exact coins a year and a half later. And so you don't typically see stable businesses shut the doors, but you do see coins go away totally. And so I'm not sure I want to be diversified in 28 different coins. [4:05] JD: Yeah, me neither. That's how I felt. I don't want to go too deep into this. We'll. We'll move forward. But if you read the article, one of the points that for us all makes, which I don't think is too much of a stretch, is in this new world of stop or helping with the gap coverage and all these new plans that are going to be set up all across the country with Secure 2.0 and the whole nine, they think that young people will be part of those companies. They've been hesitant to have 401ks to. To participate in 4.1ks. And that this sliver of crypto that Chad's referring to for us all is saying will entice them to be part of the 401k. [4:50] Chad: Let's be honest amongst ourselves here. For us all is doing that because it's an opportunity for distribution. They're planning to win a lot of that business because they are one of the few that are offering it. I get more confused, like Ed mentioned in the chat bar, why Fidelity continues to push it so hard. I don't see the upside for them being an early adopter of it in the 401k. I do see massive upside in for us all doing it because they're in a growth stage, they want clients. And if this is something that's gonna win a niche of a lot of companies out there that want access to it, I get it. But I don't understand Fidelity's push into it. [5:26] JD: Oh, I, I kind of feel differently, but I don't have time to debate it with you. I, I feel like Fidelity's got a big brand and if their name can be synonymous with safe crypto in 401k. And by the way, they're not just. It's not just in 401k for them. They want to be safe crypto outside of 401k too. To be first to market or early adopter will allow them to kind of get a head start in the race. That's my two cents. How about this? Check this out. On an unrelated interview that we're going to talk about later, Mr. Josh Itzel interviews Aaron Shum at Vestwell. And Aaron Shum says he gets asked, he says, quote, it's not really a quote, but he did say something like this. I'm getting. Vestal is getting asked constantly from clients that if they offer crypto or not in their deal. Okay, so straight from him. And then he goes on to say, personally, I'm still invested in crypto and continue to be, regardless of the implosion of some of these companies. Like, he's, he's behind it. So he, and he thinks that that's. Well, will have this type of offering when I want to be clear, when, like it has regulation support, you know, when regulators are behind it. So he's not jumping in anytime soon. But you know, he's. [6:52] Chad: Listen, crypto outside of the 401k space to make a comment about crypto and blockchain. If you have some discretionary income and you're looking to hit it out of the park, why not take a shot at some of this crypto that could potentially have massive rate of returns? Massive rates. [7:14] JD: I'll tell you, why not take a shot. [7:16] Chad: Rather just focus on, follow Robey's advice and do the same thing. [7:20] Mark: Well, all I have to say is every time I hear someone saying, oh, I'm sticking with crypto, it's usually people with a lot of money. Okay, so good for them. [7:28] JD: Well, Mark, you sent a group text to us with this little article about a Guy who apparently had two password attempts left to access his 220 million. I was going to include it because I thought good for Mark. He's sending me an article that he wants to talk about. Should be fun. That I found that that is like three years old. But what I found is a related article that's put on by Jumpstart magazine brands. Got up here on the screen and it's top three stories of lost Bitcoin fortunes. And I started to read it. It's pretty interesting. There's this guy, James Howell, who lost his hard drive. Okay. In 2013, 36 year old engineer James Howell threw away his hard drive and it had 8,000 bitcoin on it and come to find out later that it's worth $158 million. He the hard drive ended up in a landfill in Newport, Wales. And he got permission, or has been trying to get permission to excavate the landfill to retrieve his lost drive for nearly a decade with no luck. The local government believes that trying to dig up the drive would at firstly adversely affect the environment and are denying his request. [8:46] Chad: Government's already gone in there, gotten that hard drive. [8:49] Mark: Talk about a needle in a Haystack, dude. [8:51] Chad: Hey, dude. [8:52] JD: 158 million. And then your guy, Mark, his name was Stefan Thomas, he lost his password and let's see. He. The. Okay, I'm going to read this because it's interesting. Stefan Howard made headlines 10:21 for forgetting his password, blah, blah, blah. The. The hard drive known as Iron Key is designed to be impervious to all attacks, so he can't get in there. But the bitcoin wallet that Thomas cannot access, 7200 Bitcoin. It's worth over 150 million. The only way to treat the information would be by breaking down, breaking the drive apart, removing its chip and putting it under a scanning electron microscope to read the individual flash memory cells. So I tried to find the password by breaking it open and looking at it. However, this process will require a lot of money and time and the chances are that he'd fail in retrieving the information anyways. And Thomas says this makes me really sad that says that he has now made peace with his loss. So. So your guy. That was the text you sent us. [10:03] Chad: Did you mention jd? I, I was, I was reading in the chat a moment ago, but did you mention for the dude that lost it in the landfill that he's got venture capitalist money backing him to try to find it now? [10:13] JD: I don't know. Did it say that it did. [10:15] Chad: So the. He's got 118 million on there. He's got venture capitalist money that came out. They're. They're giving him like 20 million in. In different resources to go in and find it. And they get 50, right? If they find it, he's donating $60 per person in his hometown, where this is at, if he does find it, and then he's keeping the other 30 million. [10:39] Mark: Did you say $60 per person? [10:42] Chad: Just giving him 60 bucks. Just giving every person in the town 60 bucks is what he said. [10:46] JD: Amanda, I'm sorry for reading straight from the article. It's just when I read the first time, I felt like, oh, this is really. This is really interesting. I should read it to everyone. It's not usually my style, but I didn't know how else to communicate it. So, anyways, there you go. That's our little. That's our little bit on bitcoin. [11:03] Mark: I'm still really enjoying that JD's wearing a visor. I'm sorry. I just had to say it. [11:08] JD: Just supporting my son. Why don't I know this by now? Environmental, social, governance. Okay. I don't talk about it a lot, to be honest with you. It seems kind of boring to me. It's splattered all over the American Retirement Association's websites. I mean, they got article after article about this stuff. And I get it. The reason why it is, and the reason why I'm sharing it with you all today is that, you know, we're talking about Washington, D.C. here, right? This thing has. It's. It's gone through the House and now it's with the Senate. And so, you know, it's news. What's happening. Read the title of the article. House Passes Resolution to Repeal the Department of Labor's 401k, blah, blah, blah rule. So, you know, we got this new rule, basically, and it's loosely written. There's a lot of great podcasts you can listen to about it. Frederician Nevin, do a good job of it. But it was loosely saying, like, look, you can now choose these types of funds for your plan again, if they go through certain screening processes and this and that. But it would be okay for you, as a plan sponsor, as a fiduciary, to say that it is part of what they do. I'll say it esg, that is, is why you're including them. And now they're trying to say, no, no, that wouldn't be okay. You should only pick funds based on the methodology. The quantitative qualitative factors. You know the drill. So that is news on that front. [12:45] Chad: I, I, so something popped to my mind as I was reading this. I'm looking for the actual quote where some guy is just off his rocker and what he says about the funds in general. But Mark, you know what it reminded me of? When they're saying what you, what you should and shouldn't invest in. And, and essentially they're saying, we'll invest in anything. It doesn't matter if it's socially responsible is the golf world and people going over to live and getting a bunch of heat for where they're getting paid from. Is. That's not an abbreviation. [13:14] Mark: I don't know. I don't think, I'm not sure if it is. Yeah, I don't think it is. [13:17] Chad: Yeah, but, but it made me laugh a little bit because they're, you know, these folks are getting so much heat for where their money is coming from, their pay is coming from, and then we're here saying it doesn't matter if it's socially responsible. You should just invest in anything. We should have a. I'll drink for it. Again, if it is a live golf investment inside the 401k, the Roman numerals of 54, which is a score hole on a par 72 course, was birdie. Thank you, Hackler. [13:44] JD: Chad, I'm curious. Are you, are you for giving the protection for hippie plan sponsors to choose these types of funds or are you just saying no, no, we should protect the employees and the participants by making sure we have, you know, standardized screening processors that don't play in that. Don't factor this in. Like, let's just pick good investment. [14:06] Chad: No, I'm saying it should be its own asset category and there should be its own screening process and maybe not compare it to the common nine style boxes and allow it to be in lineups. You can't give, you can't indemnify them just because they want to offer it. They need to make sure that the investment is prudent to be in the menu. But I do think that there should be some protection if they want to put it in. Indemnify the. [14:29] Mark: I love it when people say that. [14:31] JD: That gets controversial. [14:32] Chad: Like, well, yeah, how would they stack up in terms of costs and all that stuff? Performance. You'd have to stack them up against their peers. You can't stack them up. [14:41] Mark: What does the cost matter if that's what somebody believes in? Right. Somebody goes to the store and picks an organic. [14:48] JD: Right. [14:49] Chad: Mark, I buy diamante Dobel. And it's more expensive than cheap tequila. [14:53] Mark: Right. They buy an organic apple and not one that's been, I guess, peed on or something like I buy the regular one. [15:00] JD: But that's fine on your own, Mark, as an individual investor. But now as a fiduciary and as a plan sponsor, I have a responsibility to put a menu of funds in front of my participants and I must act in their best interest. This is what this whole world we live in is about. Therefore, I got to put the right stuff in front of them to grow their investments. So it's not a personal choice. It's now a company wide choice. And so you can't have a whole company that feels that way. And anyways, all we're doing is recreating the debate that's happening amongst right. Unfortunately Republicans and Democrats, which I don't feel like this should be so political. It should be a very. This should be an argument between Frederician. Someone else, you know. But anyways, it is what it is. [15:47] Chad: Mark, you didn't ring me up, buddy. [15:49] JD: Stay tuned, people. The. The. [15:52] Mark: There you go. [15:53] JD: The Senate, it has a small slant towards the Democrats. I think in the House this thing went pretty much down the line of parties with one person from the Democrats sliding over to the Republicans. And the Senate's going to be really tight on. On this thing too, so. So yeah, it's kind of exciting to watch. Let's. [16:13] Chad: Super exciting. [16:14] JD: You know, it's more exciting than that. [16:16] Chad: The wheel. [16:17] JD: The wheel of ice. [16:27] Chad: Totally authentic. Never wrong. [16:30] JD: God damn. Bring them up 200. [16:38] Chad: Mark, are you capable of drinking? Do you want me to take it for you? Wait, why? [16:43] Mark: Why, why wouldn't I be capable. [16:45] JD: Hey everyone. [16:46] Chad: Sickness in your house. [16:47] JD: Everyone. Well, well, Mark, it's just Covid. [16:50] Mark: Well, it's not like it's flu symptoms like you had. [16:53] JD: Well, Mark pounds this. Fear not ice. I want you all to know that he is in the bottom of his daughter daughter's bunk bed doing this. And his son is on the other side of the room going daddy, why are you drinking that so fast? Daddy, I don't understand. Okay. Podcast, you know I love it so. Oh no, this he our boy. It's a. Damn it. I didn't mean to say it. That time is back on his podcast. Horse. Yeehaw. He's back on there. Chad. It's been a little while month. He's taking a break because he's been dragging in so much freaking new fiduciary rx biz. He can't breathe so he finally got up during a little bit of air. What? I got another one. [17:43] Chad: Prescription. [17:46] JD: Anyways, he's got Aaron Shum as his newest guest. The, you know, the best. Well, dude, and this pod can. Could inspire several conversations. I just want to say that I was really excited to listen to it. I've shared with everyone on this podcast before that I still feel a bit of black box when it comes to Veswell. I'm a fan. I'm not anti. I'm not. [18:15] Mark: I'm not. [18:16] Chad: He's here. Keep it clean. [18:18] JD: Is he? I'm not Guideline. I'm not. Guideline sucks like Samson on Guideline. And I definitely don't have the same opinions that I have about human interest I have about Veswell. And one of the main reasons that is. And I would have said this if. Is he really here? If he's here or not is. I would have said. I would have said. He came out at Pro Advisor from the get go. So he kind of had me at hello with that. So now I'm just kind of being a critique of his. His little CEO speeches that he gives out there in the world. [18:48] Mark: And when I ready for that one, [18:49] JD: when I saw that he was on this podcast, I'm like, oh, it's gonna really hit him with some good questions. [18:57] Mark: This is phenomenal. [19:01] JD: So Josh is going to hit him with some really good questions. And so I tuned in, buddy. Okay, give me two. [19:09] Speaker D: No, [19:11] JD: I owed you one. [19:12] Mark: It's fine. It's fine. [19:13] JD: I listened to all 48 minutes. They talked about great stuff. They talked about, you know, convergence. They talked about third party administrators, they talked about fee structure, they talked about user experience. I mean, it's a great podcast. Everyone should listen to it. But when it comes to understanding what makes Veswell cheaper, more efficient, a better user experience, I was still left. Aaron, if you're listening, I was still left going, where is it? What is it? How does it work? I've heard about the Docusign thing, bro. I get it. You've worked really hard with Docusign and so people can go and efficiently sign this. Wonderful. That's great. It really is. But when. When it's so asked you what makes y', all like, modern and efficient, your answer was internal operations. Like, oh, we worked really hard at, like, how we did things and where the problems were and fixing them, because we couldn't just go after a new business. We had to really build it up from the bottom. So the fuck do I with my company? Like, that's exactly what I do. You're supposed to give me something more than that. And I'm still waiting for it, Aaron. And I would like you to share it with the rest of the world. [20:29] Mark: Yeah, maybe he doesn't want to tell everyone everything because that's the successful part of his business. [20:35] JD: Okay, well, he did. [20:36] Chad: Yeah, [20:39] Mark: that's not gonna happen. [20:41] JD: He did say that a lot of advisors are testing him out and so, and so he's getting a lot of, a lot of people are liking it. So maybe that's very true. If they're testing it and liking it and bringing him more business. Sorry, Chad. You had a thought? [20:54] Chad: Well, no, I, I had the same specific to the third party administrator part of the conversation, I had the exact same thought is remember he came out, they came out to the community and said, this is what you're going to charge. Like this is what's going to be the compliance fee for the work that you're going to do if we're going to sell you in this package product with Vestwell and, and many third party administrators say, like, how are you controlling our costs? And he said, look, you may be making less per plan, but because you're going to be doing less, your margin's going to be thicker. [21:22] JD: Well, and the whole time, not just, well, doing less. Yes, but also volume, they're going to funnel business to you. [21:29] Chad: Yeah, we don't need more, we don't need more volume. [21:31] JD: We don't, don't talk about us. But. [21:33] Chad: Yeah, in general. But, but I'm looking at this going, what are we talking about? No, what I mean is we're growing at a very good, healthy rate. But back to the point, I looked at that and I said, what are you going to take off of our plate to make this more efficient? The same comment you're having on how they're able to streamline these procedures. I didn't see anything different in terms of what our role would be, our response, our time, our ability to pull data, getting census information. Yeah, if you're feeding us clean census data, that's a massive relief from the compliance administrator's shoulders. But I haven't seen anything different yet. And that's where I'm struggling with it. I got asked this question by a broker dealer today, same thing. Are you guys working with Festival? And I said, yeah, we are. We have a handful of plans. It's going really well. Happy to, to continue to find advisors that want to do business in that direction, but I haven't seen anything that, that shines. [22:35] JD: Here's the thing. If I'm if I'm honest and not angry, I actually am such a fan of Veswell because I've told you guys I think it would be great to sell something new, something innovative, something fresh. So I'm such a fan of it that I'm actually sitting there waiting like a kid on Christmas morning for Aaron to come in a Santa Claus outfit and bring me the present and open it up and show me. I want him to say these like phenomenal things about his tech stack and how his tech stack can work 10 times faster. [23:08] Mark: What's in the box. [23:10] JD: What's in the box Than the legacy providers. And I want them to show me like look, let me show you down into the weeds. This is how we're able to do these things differently from our competitors. And instead since you're here, Aaron, if he still is, he might already kicked out and upset. Instead I'm getting Chief Executive Officer circle talk out of you. I'm getting. And so Aaron, you are no longer in the presentation to the venture capital people. You are now in our industry. Tell us so we can tell everyone else how great you are and the shit that you're doing. But. [23:47] Chad: And so that we can embrace. I would love to become more efficient operationally as a third party administrator. Love to. And if that's something you've created, teach me. Teach me. [24:00] JD: Let's see. He did talk on a positive note. He talked about white labeling for advisors. So if you're a wealth, wealth management firm and you want to get into 401k that's well can help you kind of make it your own baby. Great. That's a good thing. I think that's solid. Let's see. He talked, he talked about manage accounts. I won't go there because Aaron's here and I'm going to get negative on that one. I feel. Go to the manage accounts part. It's about 3/4 way through. Watch it. So ask Aaron about managed counseling. Oh shit. And the role that advisors have in it. And I feel like the whole conversation goes into some, some black hole in the universe and gets spun around in some weird way like it's was asking about. [24:46] Chad: I didn't get to that part. [24:47] JD: The advisor menu, do they. Do they. Is it the core core menu from the funds. Is it? And I just kind of got lost on it all. But what I heard was that they can answer three questions and they can pull information from other data from other places and they can get the participants set up on a managed account service and that 65 of them currently, their take rate, like 65% of participants are choosing this manage account thing. And then he, we'll move on because poor Aaron doesn't want to hear me keep ripping on him. But then he talks about doing correction real time. We've talked about this on the show before. They can correct mistakes on their recordkeeping system in real time. Aaron, the next podcast you're on, tell me what that means. Like, what are you talking about? Like, what mistake, what thing and what value does it have to an advisor that's doing that? And then lastly they talked about loans and distributions. And apparently they can bada bing, bada boom, crack these things out really quickly and send the wire really quickly. Call me a boomer. That scares the out of me right now with cyber security and all this. Like, I don't know if I. [25:59] Chad: Well, now you're just being negative. Now you're just being negative with that one. Don't stretch it to there. Hey, the real time corrections, the way I understand it, which I think is what your paychecks and automatic data processing have been pitching for years, which is we have the data right? Then if we see that someone's getting a contribution that shouldn't be eligible, we're correcting it. We're not putting it in the trust. If we see that someone's getting a matching component and they, they shouldn't be, we're correcting it right? Then it's, it's not going to hit the trust. I talked about, like all the data [26:29] JD: all the time, kind of clean and [26:31] Chad: actively scrubbing it during the process. [26:34] JD: Interesting. [26:35] Chad: Well, I'll tell you how Aaron says yes. I'm pretty sure that's what they're. And that's, that's sexy and attractive to me. [26:41] JD: You know what I love now is on the shows, when you comment just to the hosts and panelists that everyone sees it, it's like, doesn't work anymore. Okay. Well, I love basketball so much that I, even when I was writing some of my notes for this show and have a lot of them that we're not going to talk about, I was thinking I would love to try. Like, I even had this thought, I won't do it because I'd be improper fiduciary, but I'd try my own plan. Like, I, I would love to see from the inside out. So maybe I can start asking some of the advisors and clients that we have that use that swell what their experience is like and I can learn a little more. So what's the moral of the story? I still love Veswell, but I'm still waiting to hear more of the details, the things that make it different from the other ones. [27:27] Mark: Hey, Aaron, if you're actually listening, I have a proposition. Because I know sometimes hearing JD just rant on and on and on and on can get a little bit annoying. Let's be honest, you really want to get to him. Oh, wrong side. You just throw a little Vestwell logo right here on my robe, and then JD has to see it every Thursday night for 60 to 120 minutes. It's balls in your court, Aaron. Just saying. [27:56] JD: Well, on a positive note, I will tell you that Shum was dressed dope as. As usual. [28:05] Chad: Yeah, he had a little. [28:06] JD: Little V neck vest over his crisp white dress shirt and then a suit collar popped out with a pocket handkerchief. All well thought out in different shades of gray is at least how it appeared on YouTube. And I was like, Bro, 10 out of 10 guy dresses like a freaking stud. Okay, we're gonna try a new segment tonight, people. I don't have a name for it, call it Product Spotlight until someone can name it something else. But I thought it would be fun instead of having a guest on for the whole show every time, wouldn't it be cool if we could just pop someone in for 10, 15 minutes and wouldn't be cool if it could be like a Product Spotlight. Let's find something new that's out there that we're not all aware of. You all out in chat bars aren't aware of. We here at Retireholics don't quite understand. And we can talk to that company, that person, and get a better idea what we got going on today. We've got Jeffrey. I'm going to call him jt. He's. I hope I can do that. Yeah, that's fine. [29:12] Mark: Yeah. [29:13] Chad: You guys answer. [29:14] Speaker D: That's exactly how I go by. [29:16] JD: Is it really? Yeah. Oh, cool. Do you research. [29:20] Chad: Did we just become best friends? [29:21] JD: Yep. Okay, jt, you're from the company Beagle. And to be clear for everyone listening in, hopefully JT's ready for this. We. You are going to be playing by retire hogs game rules for the 10 to 15 minutes that you're here. So hopefully you're sipping on a beer. And if you. If you had a beer. He does. Very nice. And if you say any acronym or initialism, which I've been doing a lot of tonight, you must drink from your. Your penalty drink. And I would encourage you to complete at least 12 ounces of beer in the next team in the Next. Next in the next 15 minutes. Okay. Jeffrey Beagle. Oh. Oh. Everyone in the chat bar should know this. Came across my radar because of Samson. Samson ran into it. He thought it was really cool. I think it's centered around finding people's kind of lost 401ks these days are sitting in all kinds of different employers and so they can go to your site and kind of discover where their old 401ks are. Tell us more about this because if I'm getting that right, it sounds kind of interesting. [30:37] Speaker D: Yeah, thanks for the, thanks for the intro, Jim. You know, for us, what's mind numbing? And I've been in the industry for 24 years of financial services. What's mind numbing is that there's more than 30% of 401k accounts out there that are just left behind. We call them orphans. People have just left them behind as they jump from job to job, from employer to employer. Right. And on top of that, there's about $100 billion completely forgotten. Like completely forgotten and lost 401ks that are forced out. People aren't aware of them. And that numbers some 20 million plus accounts out there. And as you guys know, with job tender shortening these days, I think the, the average is about two to three years these days. The problem only gets worse. So we, we started to develop a Solution back in 2020 where we help people track down their old retirement plans. So people obviously need help with their finances for various reasons, but retirement is one thing. And so last year we had about 800,000 people use our platform. [31:48] JD: Last year, last year I saw the $800,000 number. I didn't know this was in like a 12 month period. [31:55] Chad: Yeah. [31:55] JD: And so how are they finding How? I didn't even. I live, breathe and sleep. 4. Okay. I had no idea about Beagle and meetbeagle.com. how are they finding you? [32:05] Speaker D: Yeah, so people come to us for one of two reasons. [32:07] Mark: Dogs, real dogs, dogs. [32:10] Speaker D: We get mentioned a lot when Beagle comes up. So people come to us for one of two reasons. One, to locate all their 401ks. It's a simple search. They put in their information, give us permission to go do the search on behalf of them. We can do a comprehensive search and tell you where all your 401ks are. We are the most comprehensive 401k search provider available in the market. [32:34] JD: JT. JT. But how do they find out that you. How did those. [32:39] Mark: Oh, we're not, we're not counting it, Brandon. We're not counting It. We're not counting. No jd. We're not counting it. [32:45] JD: Yeah. [32:45] Speaker D: It's been direct to consumer primarily until. Until late last year when we started to hear from employers reaching out to us because their employees had heard about us, they were using us. They were talking about it to HR and some of these HR for bring them up participant forward folks came to us and said hey, what is the [33:06] JD: solution that you've got continue or you know, you finish your thought. Yellow too. Okay, I like this. I like that the company is going to get involved now. I like that the. You said you're a director participant. No duh. I get that. I just was saying how did they know that you. 800000 seems like a lot to me and I. I was drunk at the super bowl but I didn't see a beagle ad. So I was just trying to figure out like how they figured out. But that's okay. We can talk about that a little bit later. [33:36] Mark: Did you just say you were drunk? [33:37] Chad: I would have. [33:38] Mark: At the Super Bowl. [33:39] Chad: Were you there? [33:39] JD: No. [33:40] Chad: Word of mouth has got to travel fast. Shady. When you get into a large company that's got 15,000 employees, 20,000 and a couple of them search and find. I'm sure that it travels pretty quickly through a group like that. [33:54] JD: Can I ask about the specifics? Hang on. I'm tapping in the chat bar. I can only do one thing at a time. Jeffrey, how does. How does this work? Like what am I missing? I don't know how to find. Where's the data to find? Old account. I understand. Scrolling 5005 hundreds. I understand but where? I don't connect the dots for me. Where does this data exist? [34:21] Speaker D: Yeah yeah. Imagine you're a participant and you're looking around for your 401 case. Right. [34:29] JD: But it would take to my old employers where I would start but. Right, but help me out. How do you guys find out where they are? [34:37] Speaker D: Yeah, we use primarily technology but there's a services element behind it too to make search comprehensive. Right. So it's a combination technology and services and it's part of our tech IP. What we do is we go scour for the 401ks across different databases. [34:55] JD: You can keep. [34:56] Speaker D: Is there a long form for 401ks? [34:58] JD: No, that wasn't it. No it wasn't it. No, keep talking and you can always drink later. Finish your thoughts. Keep going. [35:06] Speaker D: And so we scour all these databases. You mentioned one being the DOL 5500 records. But there are a bunch of others and we cover 401ks, 403bs, 457s, tsp, the federal plan. We cover state plans, too. [35:21] JD: Keep going, keep going, keep talking. [35:23] Speaker D: And that's it. And that's it. [35:26] Chad: Yeah, but so the participant data isn't in any of those resources. Right. So do you have to go directly to the provider at that point and then try to get them to search if there's a Social Security number that carries an old asset there? [35:42] Speaker D: Correct. We get the. The person's name, social date of birth and address. [35:48] JD: Right. [35:49] Speaker D: And a lot of times they give us their old employers as well so we can go search for them. [35:54] Chad: There we go. And so you can search, find the provider, then search the specific providers. Like, if you look at my working history, I've had a company where they were at Empower and I had a company where they were at Fidelity. And then, you know, these are the places we need to go search to try to find Chad's lost balances. Right. [36:10] Speaker D: And we send you links that give you access to those accounts. Oftentimes we find that people have never set up an online account even though they've gotten statements quarter after quarter. [36:19] JD: That's surprising. Hey, I, like I said before, like, this is my industry. I own a company. I live, breathe and sleep it. I. This might shock people. Sorry to give personal info, but I was once a tennis coach and out of high school. Yeah. Believe it or not. And, and we had a little, a little 401k plan. I'm sure it goes under a different name, whatever schools do or whatever. It wasn't a 403B, but anyways, I've got like 2500 bucks or something in this thing. And I. And they followed my address and I get paper statements and my whole career I've been like, I should go get that. 2500 bucks. I should go get it. But I never do. So here I am with someone who is act. I know where it is. But anyways, so if I could. Not doing it, of course it's for lots of people out there, but. So back to the point of like, so you're. I'm going to go onto your site, give you my information. It's not going to happen in a blink of an eye because it sounds like there's some leg work to do. So what's the turnaround time? How soon are you going to come back to me? And what does that look like? Are you sending me an email letting me know? [37:22] Speaker D: That's exactly it. In one to two days, we send you an email. With the search results. [37:29] JD: One to two days. Okay, send me an email. We're running out of time. We got about seven minutes left here if we can use it. Okay, got the email. Great. Thanks, Jeffrey. I really appreciate it. I'm going to go to these old employers, do whatever I need to do, but I'm guessing there's more for you now. You're. [37:46] Speaker D: Yeah. [37:46] JD: So you're going to help me consolidate them. And I'm assuming this is going to Venn diagram into how you actually make some fucking money here in this process, right? Or. [37:55] Speaker D: Yeah. So. [37:56] Chad: So people. [37:57] Speaker D: People log into the links that we send them. They can reset their passwords at Fidelity, Vanguard, Principal, you name it. Right. [38:04] Chad: And. [38:05] Speaker D: And they access them, they find their balances, and they go, okay, well, I need help consolidating them. Most of the time they will ask us to consolidate into their current 401 case. Right. That's the majority of folks because they just want to have it one place. It's hard to allocate your course portfolio appropriately when you have disparities. [38:24] JD: And Beagle. And Beagle helps them do that. [38:27] Speaker D: Absolutely. So. So the way we get paid to your question is for each Rollover, we charge $45 to the participant. So no cost to the advisor, no cost to the employer. It goes directly to the parties, participants who've been paying for it, and that's how we make our money. [38:44] JD: Well, I'm blown away here. You're too much of a boy scout. [38:47] Speaker D: And the first rollover includes the full search for 45. [38:52] JD: 45 bucks. The full search. And you're going to help me moving into my current 401k or basically wherever I want to do it. You've got me, you got my, my jaws on the ground. [39:03] Chad: Right. And all the. [39:05] Mark: Where have you been on my math [39:07] Chad: on the 800,000 clients last year right [39:08] JD: now, hey, I would. I would recommend that everyone jump on this as quick as possible. If you're a participant out there on YouTube watching this, you should do this because Jeffrey's not going to be in business for very much longer. I got to say, 45 bucks, it's [39:23] Speaker D: hard to do it cheaper than we do, right? [39:25] Chad: Of course, yes. [39:27] JD: But I guess if you've. If you've got eight. 800,000 people. Mark, can you do me do the math? [39:33] Chad: 800, 800,000 people leveraged the technology. What if there is no rollover that you find? Is there still a charge of those people you do the search for? [39:42] Speaker D: No, we do tons of searches where people are. I don't know they, they think they contributed but they didn't, they didn't elect [39:50] Chad: and you find nothing and I find [39:52] Speaker D: nothing and we tell them and it's a refund. [39:55] JD: How, how many of the 800, 000 are you guys actually doing rollovers for? [40:03] Speaker D: Oh, a good double digit percentage. [40:06] JD: And can you, can you times that number by $45 for me? [40:11] Speaker D: Yeah, I think my partners would rather might take a shot and disclose that. [40:15] Chad: Yeah. Jeffrey, where J.T. where J.D. was leading us earlier was will you take on rollovers? Will you guys access or take on that responsibility of aggregating? And is there a, an additional source and fee income for you all if you go that route? So let's say they don't want to push it to a 401k. [40:37] JD: Do you have a idea of a rollover solution yourself? [40:41] Speaker D: We have, we have a $4 a month flat fee IRA. It's not asset based, so it's actually pretty cheap and it's really for people. We give them all the choices. [40:51] JD: Right. [40:52] Speaker D: They can roll over current 401k. They can consolidate into their current IRA. If they don't have an IRA and they're looking for solution, we say, hey, here's one possible route but you know, betterment, wealthfront. We offer all of that. [41:08] JD: Okay. Okay. [41:08] Chad: So you, that's awesome, man. [41:10] JD: You just went from boy scout to like, you know, Boy scout that sneaks off to have a cigarette once in [41:16] Chad: a while, which he's charging $4 a month. No, that's great. [41:21] JD: Yeah, but just tell me that from the beginning. Okay. It's perfect. Okay. It still seems very cheap to me, this whole thing. I gotta sit back and start doing the math on it. I have one last question. [41:32] Mark: Please don't do that. [41:33] Speaker D: Come on. [41:34] JD: I have one last question is. Okay. And I, and I think this is the missing piece of the puzzle here. Is that 800,000 that are finding it. Is this just like, is this SEO on Google? Yes. I'll drink for that. Is this like, are you paying for advertisements? Like how the, that's a lot of people that have been exposed to Beagle and used it. That's very, very impressive. And so I just want to know how you accomplish that. [42:03] Speaker D: Yeah, I think once you start looking at one of our ads, you're going to see it over and over again. [42:07] JD: Okay. [42:08] Speaker D: Yeah, we're, we're pretty much everywhere. [42:11] JD: So it's ads. I guess I have time to slide in another one then. Any, any venture capital funding or outside money. Like what's, what's behind this thing, we're venture backed. Venture backed, man. [42:25] Chad: We're gonna make money. See, these venture capitalists are not dumb. They know there's money involved. Then if you're getting that kind of of dota to get running. [42:34] JD: I have to say though, I tend to be pretty anti outside industry people coming in venture capital backed to do things. And I'm not trying to be nice to you because you agreed to be on the show here, Jeffrey, but this one, Beagle, seems to make sense to me. It seems safe. Doesn't seem like you're trying to do anything crazy. You're providing a service that I've seen the chat bar talk about. We all don't have. We don't really have anything like this. It's needed, it's necessary. So, not that this will be part of this segment. We won't give people thumbs up or thumbs down when they come in. But I, I'm, for now, I'm ad libbing and I give you a thumbs up like, okay, I'm interested. I think it was my brother in the chat bar said I should try to take my high school coach money and roll it into my current 401k with Beagle. And I'm saying right here in front of everyone, I will gladly pay the 45 bucks and, and try to do that and kind of experience the situation. That should be fun. [43:35] Speaker D: Yeah, no, I appreciate the kind comments, guys. [43:37] JD: Yeah, no. Okay, cool everyone. That's Beagle and that's. [43:42] Chad: Keep doing the good work, jt. Thank you. [43:45] Mark: Thank you. [43:46] JD: Well done. [43:47] Speaker D: Cheers. [43:47] JD: All right, man. See ya. [43:48] Mark: See ya. [43:49] JD: Okay. [43:50] Mark: Go Giants. [43:52] JD: Go Giant. He is a Giants fan. This is where I think, hey, talk about it. [43:56] Chad: But you know, you know, when, when, when the provider world stopped doing a good job tracking lost balances, there came all these search engines that came out right? Different companies saying we'll, we'll help you continue to communicate with your employees that have left the plan. From a notice and disclosure standpoint, this is the other side of it. This is people saying there's money out there. How you gonna find it for me? And they've built a tool and a resource for the consumer side of this. I love it. [44:23] JD: You know me though, I, I still struggle with the. It was ad in the chat bar that agrees with me as like struggling with the profitability. These. [44:32] Chad: Why is that your worry? I mean it. [44:34] JD: I'll tell you why. [44:35] Chad: It's service. We're not telling, we're not saying we're parking our money with Beagle. They're using A custodian if you're using the individual retirement account side. But otherwise they're helping you facilitate a [44:46] JD: rollover for 40 days anytime. By the way, Samson brought it to us. Plan sponsors are now starting to be aware of it. This is not just a direct to consumer thing. So anytime. The whole reason it's on the show, Chad, this, this show's not for participants, it's for advisors. And so my concern with things that are venture capital backed and don't make sense to me from a profitability standpoint is will they be here in two years or four years or five years? And I don't want Samson to run around to his 150 clients saying that this is a great thing and putting his endorsement on it. But, and that's, I'm answering your question. You asked me why I care, Chad, and I'm honestly answering your question. That's why I fucking care. [45:31] Chad: But I think you're wrong in the need for that. This is a one time solution for an individual employee. And so yeah, that company is going to hire on a few new folks. But, but this isn't a, this isn't a tech stack piece that's going to be ongoingly used by a company. [45:49] JD: Then, then it's a one time search. Then shame on me for putting it on this show, Chad, because the whole reason it's on this show is because I think the advisors that tune in can say, hey Beagle, this makes sense for participants and my plans to go out and look up different things. [46:05] Chad: And I don't really. It does well, but it's not an ongoing thing. So imagine he goes to his 50 clients and says, hey, I want to, I want to encourage our, our participants to do this. We may find some extra money. And now he uses it in the future with, with new prospects. Hey, this is something I help my clients do. Many employees have these outside balances of that. So that's the way he continues to use it. It's not a, hey, client, let me position this as a service and I'm going to do this with all of your employees every year because it's not relevant. It's a one time search for those employees, maybe for new, new employees. You could say I'm going to do it for them. But I'm very, there's very little worry in my mind about them sticking around. [46:44] JD: You've lost me there. I, what I don't want is Samson to build it into his model, build it into his proposals, build it into his internal operations, build it into his value Add Remember the original question was I want Samson to do that if it makes sense. You asked me why I wanted to know if it was profitable. And you could ask that same question of me. Of why would I want to know if a record keeper is profitable? Because I don't want to do business with them if they're going to close their doors in four day. In four months or four years. [47:18] Speaker D: Sorry. [47:18] Chad: I think that's different though. We can move on. [47:20] JD: But that's slightly different. But it's not completely. [47:23] Chad: One's a transactional service. It's a one time thing. The other one is an ongoing service. [47:28] JD: Bro. I. We do transactional services at Plan Design Consultants that I don't want to bring something in, snap it onto my model and have it break in two years. Right? Maybe. [47:41] Mark: Maybe I, Maybe I missed this because I don't. [47:43] Chad: I didn't do any research. [47:44] Mark: How long has Beagle been around? [47:48] JD: I think last year was her full. Full. [47:49] Chad: You said 20. 21 is when they started creating it, so. [47:53] JD: Yeah, when they were building. [47:55] Chad: Hasn't been around long. [47:57] JD: Less. Let's go to something lighter. Let's. Let's see what Chad's opinion is on this. 401k fashion. I got a text today from three industry people. Two defined contribution investment only friends of mine sent me a text. And. And what? The third person is an advisor? Chad. [48:18] Chad: No. Second person is a record keeping wholesaler. [48:21] Mark: Oh, good point. [48:23] JD: This is perfect. Defined contribution investment only, record keeping wholesaler and an advisor all sharing the same fashion. Brandon, tell me you've got this. There we go. Okay, this is a problem in my opinion here. Oh, you saw it when he zoomed it in, right? It's hard to see right now, but thank you, Brandon. But it's this. You know the thing we've talked about on the show before. It's the vest over the dress shirt. It's like a plague, people. It's. It's getting everywhere. Now I gotta take my robe off. I can't believe you even own one. [49:06] Chad: Mark. [49:07] JD: It's accepted. [49:09] Chad: It's. [49:09] JD: It's got the corporate thumbs up. Apparently it has. It has. [49:15] Mark: On that road, guys. [49:16] JD: It has morphed and jumped from. From DCIO to record keeper to advisor. Like it's to tpa. It spreads fastly quickly. [49:27] Chad: There's a name for this, right? You introduced it to me when you were in Chicago downtown uniform. [49:33] JD: But my point is. [49:35] Chad: Oh gosh. [49:36] JD: It has clearly gotten out of hand. Okay, now we need to assess this a little bit. Why? Why has this happened? I'll tell you what, at least two or three of those guys were forced to wear suit and ties for a large part of their life. So they are giddy with this new option that corporate has apparently endorsed. I personally am. I used to go pick up my, my daughter and my son at high school from time to time. And you'd see, no offense to 15 year olds that are watching this show, which is nobody, but you see like three, a group of four or five 15 year olds walking down the sidewalk together and they all were wearing like van slip ons and the same kind of pants and some kind of similar like sweater jacket. I'm like, okay, you're 15. You have low, you know, low self esteem, low self confidence. You're, you're growing up, you know, trying to figure yourself out. And so you want to be part of a crew, of a culture, of a thing. I get it. When you're 15, these are grown adults copying each other wearing this. Look at Troy and Matt. They're wearing the same shirt. [50:49] Chad: They're not copying each other. It is a style that is endorsed in, in. And so they're choosing to sport it. I, I mean, I. To the depth of me. I hate it, but I. It's just a style. [51:02] JD: Okay, Can I throw something out there for you? There's some other alternatives. Okay. And I'm just. [51:08] Chad: Can't all afford Gucci shoes. [51:10] JD: No, no. I'm just saying this as an industry. Mark, I love you. I'm saying this as an industry. [51:18] Mark: I thought you were gonna start the show with this. So I, I have the robe over this. [51:24] JD: Man, you're. [51:25] Mark: I've been sweating. I've been trying to keep my sleeves. Holy cow. Oh, I can finally. I'm getting out of this. [51:33] JD: Here's the thing. No. Okay, fine. I understand the positive of losing the suit and tie and going to this, I get that. But why, why can't we go like quarter zip up, nice sweater dress. [51:50] Chad: We're all gonna be. [51:51] JD: That's that too. [51:52] Mark: No, no, no, that's the same thing. [51:55] Chad: Why can't corporate endorse that? [51:57] JD: These are other options. Why is this their only option? Or why is everyone doing this? Like, are we all just copycats, east coast thing? No, honestly, people, it's spread. It's come to me. Yeah. [52:16] Mark: No, what we don't see, and this is the key here, and I'll be honest, this is very key, is we don't see their pants. [52:23] Chad: Okay? [52:24] Mark: And here's my thought, is I think a lot of them wear it with jeans, so they Feel as if, like, having jeans on, like, having the vest kind of makes it look a little dressed down. Again, I'm not. I'm not agreeing with it. And by the way, this vest was sent to me in a box of stuff from my buddy who works for Travis Matthew. I did not purchase this vest, nor would I ever. It just happens to be in my closet. I saw the picture, and I said, hey, I own one of those shirts, too. That's great. I haven't worn it for, like, two years. I'm going to throw it on, and it's going to be a joke. I want to get out of this as quickly as possible. And Amanda, Yes. I'll have no clothes on very shortly. But my point is, I think that that is, like, well, it looks like sort of. Maybe they think it looks kind of hip because there's some jeans involved. And then my next question is, what are the shoes? Because in my opinion, dress shoes. That's where I dress draw the line. If there are brown dress shoes attached to this jeans, I will lose my mind. But if there was, like, some retro blue and white Jordans, hey, I might [53:32] JD: be okay with that. I like that. That was great commentary. My. My point is far more simpler than that. Although it is interesting to think about what they're wearing below the waist. I assumed it was dress slacks and dress shoes, but you might be right, Mark. Maybe they go. [53:49] Mark: It could definitely be khakis, but if there's loafers or dress shoes, that's where I lose my. [53:54] JD: My mind. [53:54] Mark: Yeah, I'm not. [53:55] Chad: No. [53:55] JD: My simple point is, if we are going to become more casual as an industry, hallelujah, let's do that. But we do not need to clone each other and all wear the same thing from the east coast to the west coast. And so I would like to see some quarter zips. I would like to see, you know, wear a dress shirt with dress slacks and. And roll up your sleeves a little. I don't know. Like Chad said, wear a Gucci T shirt and jeans and some Gucci shoes to show that it's expensive. I don't know. I'm making up, but let's not all do the same thing. Apparently, everyone is dying to get out of the suit and tie. And the vest in the dress shirt was the. The life preserver everyone was looking to scrimp. My Lord, I'm tired of it. I'm sick of it. Chad, it's time to put you in your best place. This is. This is where you thrive. Looking at the details, dealing with spreadsheets analyzing numbers. Here's the thing. Here's the thing. Everyone listen in. Secure 2.0 and the tax credits, which we talked about before on this show, they are a big deal. And especially if you're into sales and closing new business, and especially if you don't mind slinging a few startups, secure 2.0 in the tax credits is going to basically flip upside down everything you've done for the past five, 10, 15, 20 years, because you got a lot of new advantages to pull on. Chad has created a calculator via a spreadsheet. Mind you, we're not trying to sell you anything right now. We'd like to convert this to more of, like, an online app type of thing and less of a spreadsheet, which I've got some plans to do for him, and you all could access it for free. So it's. We're not trying to sell anything. It's more about the conversation that this may drive. So bear with me, because I know a man is going to hate this, and Chad is gonna be very awkward for you if you've ever had your own video play for a long period of time while you're there. [56:18] Chad: It's not horrible. [56:19] JD: Yeah, it's bad. [56:20] Mark: Horrible. [56:21] JD: So if you all could just be patient. Yes, Brandon. Is he doing the audio or are we just running the audio? We're gonna run it. We're just gonna run it. Okay, Here. I want to play something for context from the earlier thing, though. Raised in the woods [56:37] Chad: when he was only three. [56:40] JD: Oh, hey, kid. What'd you do, jump ship? What's with the life preserver? [56:48] Chad: Brandon was looking that one up for a while. That's good. [56:50] JD: Okay. All right. I. I wish. I want to tell everyone that I was intelligent enough to call it a life preserver because it was a vest and it's. Buffy. I just pulled life preserver out of left field. I had no idea that. [57:01] Mark: I thought you intentionally did that. [57:03] JD: Damn it. I could have looked so smart. Yeah. So we're gonna play about three minutes of Chad going through this. This calculator. And let me give it some context here. I just think advisors that want to go out and sell startups need to get very comfortable with tax credits and how they will represent them, how they will talk about them. And so hopefully Chad's little presentation here can kick off this conversation for us. So, Chad, take it away. Virtual chat, GPT. I'll drink, Chad. Oh, and if your heads get in the way of a Move out. [57:50] Chad: All right, here we go. You've got a client that is delayed putting in a plan. They're now a 40 person company. Let's say of those 40 people, 35 of them are non highly compensated. And let's say we're going to start the plan this year. There's no automatic enrollment and they're paying between startup costs and annual administration. Let's say their build expense is six grand. With the new Secure 2.0 credit that's in front of them for plan expenses in this first year, they're going to get a $5,000 tax credit, dollar for dollar credit of the six grand of expenses that they have. But of that six grand, there's still $1,000 they're not getting a tax benefit on. So we're going to come down, we're going to calculate what the deduction is that they're going to get on that remaining thousand dollars. And so of their six grand of expenses, they're in line to save fifty four hundred dollars in taxes. Boom, baby. 5,400 on six grand of expenses. But it gets even better. Let's go to the contribution credit, the 2023 plan. They've got 35 people who are earning less than a hundred thousand. And let's say they're going to give a $50,000 Safe harbor match in that first year. In 2023, they're going to qualify for a $35,000 tax credit. It's the lesser of a thousand times the number of of people earning under 100k or the full matching dollars. And this case we've got 35 people. In 100 case, it's a $35,000 tax credit. There's still $15,000 between the credit and the total matching contribution. So $15,000 in a 40% tax credit or 40% tax bracket means they're going to save another six grand in a deduction of the $50,000 match, they're going to be in line for $41,000 of tax savings. This isn't even taking into account the fact that we're using the safe harbor to allow the owners to maximize their deferrals so there's even more tax savings. We're just focusing on the credit and the deduction of the employer contribution there. Now don't confuse clients by getting into all the nitty gritty. All the data can pull and show your your total cost credit is 5,000. Your deduction on the remaining cost is $400. Your employer contribution credit is 35,000. Your remaining contribution tax deduction on the difference is six grand. They're going to get $46,400 in tax savings. Again, not even including the deferral savings that they're going to get. By allowing them to maximize their deferrals just based upon the match and the cost credit, they're going to get back $46,400 of the 56,000. 50,000 and match 6,000 in expense. They're going to get 46. 4 of the $56,000 in tax back on those contributions. It's a beautiful thing. Thank you. Secured 2.0. [1:00:52] JD: Great question, David. It is. You do have to think about year two and year three, and that's actually built into this. If you can hear me. [1:01:02] Chad: Yeah, we can hear you. Yeah, two and three is in there. It takes into account how it phases down. It takes into account auto enroll. It takes into the account the low of the percentage of credit that you get as you go every step above 50 when you get to 51 to 53 to 60 to 80. So all of that's built in, but it's different sheets. Obviously, it'll be a different flowchart in the URL if you click I'm 1 through 50 or I'm 51 through 100. [1:01:27] JD: Hey, and, and here what I said before in Desenso, you can also, if you saw the beginning, you can click to add the auto enroll too, and It'll add the 500 bucks in there. But this isn't, we're not, this is not a product spotlight like before. This was literally, Chad was showing me this and I was like, because, yes, this is something that we want to create to, to make available to advisors. And by the way, anybody, anybody out there that wants to use it, I don't give a shit. But the point was, it's like, I'm like, Chad, wow, we've been talking about these tax credits in theory on this show for a while, and now it just really hit home for me. And I'm sorry if I'm the slow surfer, but I'm like, this is real. This is legit. This is amazing. Like, to be able to walk in and show people. There's a, there's a recent article from Fred Barnstein that says people are going to start selling plans that are free again. You know, like, hey, your plan's free. In Chad's example, it wasn't quite, quite free because he used a different example, but you could use the same calculator to show people that their plan is free. And then lastly, I want to kick off the conversation and you should probably quarterback at Chad. But then you also take it into your old context of showing them design, like cross tested design and how much of the, of the profit sharing contribution they would get and what that would mean from them in tax savings. And you slide this numbers into it, which is kind of ingenious and I'm sure there's other TPAs that are doing that. But. So anyways, it wasn't about casing the calculator. It was about isn't this cool? Let's talk about it. [1:03:07] Chad: It's that I think even though we're three months into this, two plus months into this, I'm still not coming across advisors that know how this works. They're not sitting down, able to calculate what the credit actually will be. They don't know how to communicate it. They don't know what the deduction versus the credit is. And I'm sitting here going what in the world are you doing? This is where you should be spending some time right now. If you, if you even sell a singular startup plan in the, in the next year, two or three, you need to have this down. You need to understand how to communicate this. [1:03:40] JD: If you go in and you don't, you're kind of doing them a disservice, aren't you? Listen to Brian Anderson on 401K Specialist podcast with pooled employer plan lover. What's his name? Damn it, help me out. Chat bar. [1:04:00] Chad: Swisher. [1:04:01] JD: Swisher. And he does a great bit inside of that podcast where he talked. He, he calls it like back of the napkin where you need to be able advice. He says advisors by summertime need to be very comfortable with their kind of pen on the back of the napkin to explain this stuff. Chad's obviously put it here calculator format. We'd like to expand and that is, [1:04:23] Chad: that's been my point. The guys know we met this past week as, as I've been putting this together and, and blending it into what is our tax illustration. [1:04:34] JD: Did I say envelope? It's back of the one. [1:04:37] Chad: It's the back of a napkin. [1:04:39] JD: Oh no. [1:04:41] Chad: But I've been telling the guy there's no back of a napkin. [1:04:44] JD: Napkin, both sides. It's back of an envelope. Like, like bro Apple was created. [1:04:51] Mark: I don't know, I just, I might disagree with that a little bit. [1:04:54] Chad: Point being, don't get lost in the calculations. Understand how to communicate the tax credit and the tax deductions. And so everything that we've done, everything we've talked about with the sales team is like, look, don't worry about showing them. We have 35 people who are under 100k in FICA and you have this and you have that worry about communicating accurately the tax savings that they're going to get for starting a plan. That's what this calculator is meant to do. Don't worry about the calculations, worry about the outcome. [1:05:22] JD: Well, I, I think there's two paths down the road here and both are really valuable. One is the more complicated approach. And you're going to have clients that like numbers. They're very interested in tax savings, they're very interested in the numbers. Working from a business perspective as third party administrators. And there's some tune in tonight. We live and breathe on that. Right. Like to be able to show someone a design that makes sense mathematically is like, it's like shooting fish in a barrel. Right? It's like you can look them in the eye and say this is a no brainer. Like this makes sense. Go ahead. [1:06:03] Chad: People who don't do this every day. JD let's be very clear. Mark, Justin, you guys can validate this for me. You go see a hundred clients that you're doing a startup for, what 90 of them say, oh, we can't afford an employer contribution right now. Like it's, it's almost every time they say, oh, we're not, we're not ready to budget for a match. We're not in a position for that. And when you're able to articulate for them that you don't have to budget for it, we can use tax credits to cover the match. There's no, there's going to be no net cost or a tax positive plan for you. That's when the light bulb finally goes off in their head that they're like, oh my gosh, I can do this. I can reward my employees. I'm just taking money that I'm already given to the irs. I'm pulling it back and now I'm giving it to my employees. That's when things just Internal Revenue Service [1:06:50] JD: and you can go more complicated. We're not going to give you a demo tonight, but I'd love for you to close your eyes and think about Chad. What he showed me earlier today is you can actually dive into the cross tested, profit sharing, you know, type of plan and, and, and bring this savings into that and help show how the whole thing works in an even bigger way and a better way or worse or not worse or just as good. If the cross testing didn't work, that Great. Like, it wasn't a slam dunk, but it was pretty good. Now you can use the tax credits to really soften that, make it look even better. Like it boosts it up. And then on the other path. So that was the complicated path. On the other path, you can go more simple. And Chad, you said that Justin, Mark, were very aware of this, where you're just going to go in and be like, hey, bro, this, this plan is basically free for you. So you're going to get five grand. [1:07:51] Mark: I will, I will never say that you could, but it gives the wrong interpretation. That's, that's, that's like, that's, that's. [1:07:59] JD: Here's greasy. [1:08:00] Chad: That's. [1:08:00] JD: Here's the next, here's the next one. I want to ask you then, because hopefully people listening and this is what they're asking themselves to is these are year one numbers. These things, a lot of these things, the employer side will, will structure down in year two and year three. This whole thing will vanish in three years. So we all as an industry have to get comfortable at explaining that. Okay, this is for the next year and the year after that, the year after that. Am I, am I making sense? [1:08:32] Chad: The cost credit does, but the match credit phases out over five years. [1:08:38] JD: Five years, but it phases, it gets. [1:08:40] Chad: But let's not forget, you guys, take a step back. Six months. That's all you're doing. You're just going back to the conversation we had six months ago, which is, hey, in years 4, 5, 6, 7, 8, 9, 10, things are going to change. We try to design a plan that will work for you for 50 years, but it never does. So you have to be consultative to your client. And maybe it is. You open up a safe harbor plan that they fund heavily for five years and claim as much of the credit as they can. And then they go to a discretionary with vesting to capture some of the forfeitures after maybe they remove the match. Oh, that's it, guys. Like, I don't, I don't want that. But for people who are knocking it, that it only lasts for five years, then it goes back to the same conversation we have for the last 50 years. [1:09:25] JD: Yeah, getting more money. I don't think we talked about that in detail because, like, this industry is full of details. But the employer contribution, to get the government, for them to chip in, it has to be 100 invested. Yes. Which is why you kind of use the safe harbor for your example. Is that accurate? [1:09:49] Chad: Yes, I'm writing in here right now. [1:09:51] Speaker D: It's five years. [1:09:52] JD: Is that right? [1:09:53] Chad: What's that again? [1:09:55] JD: Your, your employer contribution has to be 100 vested to get the government contribution. [1:10:02] Chad: No. [1:10:02] JD: No it doesn't. Okay, okay, my bad. [1:10:05] Chad: No, it's any employer contribution, any employer dollars going into the plan. [1:10:09] JD: So you can have six years or non elective bassing on it and you'll still get your government money. [1:10:15] Chad: Yes, you're still getting the credit back. [1:10:17] JD: Okay. Okay. Anyways, we've talked about this before. The point is you should be brushing your teeth in the mirror in the morning and then saying to yourself, looking at yourself in the mirror and being like, what's my pitch? How do I talk to my client about this? How do I, how do I present it? Do I do it on the simple side, the complicated side? Go ahead. [1:10:41] Chad: I'm going to, I'm going to make one last point on the credit because I feel like this is part of our secret sauce. Every advisor I've ran into and we have many third party administrators on that I've ran into, they always tend to show the tax savings and they show the tax saving based upon the contribution going out the door. What I rarely run into people that do is they show the net effect of the tax savings which is what are we getting back in tax credit or deduction and what is going out the door in employer contribution or cost and operations. So you either run an employee benefit plan which means your, your match costs more than the tax savings that you're getting as an owner. [1:11:27] JD: The math doesn't make sense. [1:11:28] Chad: The math or you're running a tax efficient plan where your tax savings exceeds the match that you're giving for the contribution that you're getting. [1:11:37] JD: What, what is our safe harbor contribution at plan design Consultants in those two groups? [1:11:44] Chad: I don't know. You know, I'm not in there calculating who's participating and getting. [1:11:49] JD: It's an employee benefit. [1:11:50] Chad: Sorry, it's an employee benefit for sure. [1:11:53] Speaker D: But. [1:11:53] Chad: But my point is don't just stop and show what the tax savings is. Work with the client and be able to articulate what the net tax savings is. Yeah, it's great. They get to save 60k but if they save 60k and they're giving up 100 grand, they still gave up 40 grand. It cost them 40 grand to run $100,000 match plan. But if they save 60k and they only matched 40 then they're net ahead 20 grand a year. They clawed back 60 grand from the IRS and they gave 40 to their hard working employees. You need to be able to Articulate it in that capacity 100%. [1:12:26] JD: Because if you go back to that thing of saying like, you can look at your prospect and if you've communicated the numbers effectively, you can say this is a no brainer, like this makes sense and we'll end it with this. How cool is it going to be to go to small employers and help them put in a plan where their employees are going to look at them and be like, what? We're getting a 401k and we're getting an employer contribution from you at our flower shop or auto body shop on the corner. Your employees are going to be like, this is sick. Like this is awesome. And you get to be the employer to give that to them. And, and people like Chad, Mark, Justin, people tuning in, you out there as an advisors can let that business owner know this is a no brainer. Mathematically. Like this makes sense for you. You're not losing any money on this and all you're getting is benefit. All pray. Inhale secure 2.0 tax credits right now. Just given your pray to them. Get on your knees. [1:13:36] Chad: When it came out, remember we said on the show the way in which the community presents startup plans is going to change. It will be forever different. As long as this exists and we're seeing it, guys. We do a lot of startup plans, hundreds every year. It is dramatically changing our conversations. [1:13:52] JD: It's gonna be massive. Justin and Mark are going to triple their numbers from last year based on. [1:13:58] Chad: All right, we already did. We jumped their quota four times. So as long as they triple, they'll be close to getting a bonus. [1:14:03] JD: We're gonna go chop our champion. Last week's champ, our champion was Schofner, Brett Schoffner. Thanks to Mark's Inspector Cluso work, we have found out that Schoffner is not at home this week. I reached out to him via Instagram, backed it up. He's not there. So I told him we'd hit him up next week, please. [1:14:27] Chad: And I'm tired of oh yeah, that's next week. We need time for that. Yeah, yeah, yeah. [1:14:33] JD: Okay. Because the after vote. [1:14:35] Chad: Justin. [1:14:36] JD: Yeah, yeah. Chopper champion voucher. Thanks, Chad. Great. Take the reins like that. Sometimes I like that Hackler. Nice. [1:14:45] Chad: I'll get. [1:14:46] JD: I'll back up Hackler. Two hacklers. And I mean that. Like he was, he was, he was bringing it tonight. [1:14:53] Chad: Everybody brought it tonight. Samson's Aaron Chubby comment. I wrote down Mike D for JD's past account. Is that vest. Well, I thought that was hilarious. That's really funny. Kush. Won it with the conundrum of does Brandon focus his energy in the porn industry and then highlights this on Thursday nights, or does he focus his energy in this industry and highlight in the porn industry once a week? That won it for me. So Kush. Kush is my vote. [1:15:21] JD: You know what I like about you guys? You're going for the. Like the goats. You're going for the just too good. [1:15:27] Chad: It's just too. They're too good of a night. [1:15:29] JD: Yeah, I dig it. I dig it. Okay. [1:15:32] Chad: You had a great night, Amanda, but it was solid. [1:15:36] JD: Mark. [1:15:36] Mark: Wait, who. [1:15:37] Chad: Who was. [1:15:37] JD: Everyone voted for Kushner. [1:15:40] Chad: Well, or I did. [1:15:45] Mark: I just want to see Hack versus Kush on something. [1:15:48] JD: So let's do it. [1:15:49] Mark: Yeah, I'll vote for Kush. [1:15:51] JD: Hack versus Kush. You know how we do this, people. [1:15:56] Mark: Sorry, Amanda. That comment was great. [1:16:00] JD: Wow. If. [1:16:02] Mark: Amanda, think about this logically. You're very smarter than all of us up here. If I voted for you, Hack would win. I don't think you want Hack to get a guaranteed win. [1:16:12] JD: She hasn't been here a while. She's not used to the new rules. Oh, yeah. [1:16:15] Mark: We don't vote anymore. We don't vote anymore. [1:16:18] JD: I love how she's. Amanda. You're awesome. Okay, so we gotta. We got a tie break, so cushion Hack, and we're gonna leave it to Robey. Take your time. Rob. It's. It's a sentence that you want them to finish. We know the drill. Everyone knows how it works. Take it away, Rob guy. [1:16:36] Mark: Oh, you want me to do the sentence? No, I, I, I really. [1:16:40] JD: Sex message. What? [1:16:42] Chad: I know. [1:16:43] JD: Hey, what do I say? Everyone. People listen to this show. [1:16:47] Chad: Yeah. For those that don't get the inside joke, we just got text messages that their vests are burnt. [1:16:53] JD: We got text messages from the bestie besties, and they're not happy with the show tonight. All right. Mark. Yeah. You gotta tiebreak this. [1:17:00] Mark: Okay. Jesus. [1:17:04] JD: Easy. What? I like to put my bitcoin in my. [1:17:13] Mark: No, [1:17:16] JD: the. [1:17:21] Mark: I. I got nothing, man. I'm struggling. If I took Robe guy on a date, I would take him to nice. [1:17:34] JD: Okay. If I took Rogue guy on a date, I would take him, too. Kush. Hack, you know what to do. Take your time. You don't. It doesn't have to be quick. We got time, man. Life is precious. Just chill. [1:17:47] Chad: Acres wanted quickly to Mark's heart. [1:17:52] Mark: I've been there. [1:17:53] JD: Oh, Pebble Beach. Hey, Hackler. [1:17:56] Chad: I've already taken them there a couple of times. [1:18:00] JD: Kush. Kush is waiting to, like, drop Some hardcore Republican share. [1:18:04] Chad: I know either that he just signed off right away. [1:18:09] JD: Is Chris gone? No, he's nice. The vast. [1:18:16] Mark: Good job. [1:18:17] JD: Come on. Kush is the winner. Okay, Kush, you're the winner. [1:18:22] Chad: Well done. Kush. [1:18:24] JD: Kush. Next week, are there gonna be kids at your house? Because I don't. Wait, no, no. Kush's word. His. His sons crush the. The. The. The hot wings, I think. Right. Anyways, doesn't matter. We're not shopping food next week. We're going gifts things. So. Okay. Next week. Oh, sorry everybody. Thank you for tuning in. We love you. We appreciate you. The show's about to wrap. Next week we are traveling. We are going to be doing a live on stage show in Denver, Colorado for the Advisor group's employer retirement plan summit. Here's the cool thing. It's at 5:30 Denver time, which is, you guessed it, 430. Normal. Normal time. Okay. You've been through this before. If you're one of our faithful viewers, like, it's a lot on Brandon to stream live. It can be tough. But. We're gonna give it a shot. You know, we're gonna give it a shot. [1:19:46] Mark: Wait, hold on. You said we're. We're streaming live. [1:19:50] Chad: Do we have a guest? Jd? Do we have a try? [1:19:52] JD: We're gonna try, yes. Brad. Brad. Brent. Brad. Bruncha. It's not Bradshaw. God damn it. Chad, why do you have Brian? Brian, okay, is with us on stage. And then we're gonna have another advisor join us through the show. But it's a normal show but on stage. My point is we'll try to stream it to you at the same time, but you know how that works. Could go weird. So will we give prizes to the chat bar champions next week, Brett Schoffner and Kush? Yeah, because that will make for a good comedy bit on stage in front of a live audience, right? [1:20:33] Chad: Yeah. [1:20:33] JD: Let them know what we bought at Walmart or whatever. So we'll do it. We'll do it, we'll do it. And so, yeah, next week we'll be hopefully coming to you here on the same bat channel, same bat time, but with technical difficulties, live from the stage. And if you tune in and you're like, what the going on? Whoa. You know, it's hard. Brandon up. We had to. Our first priority is to do the live show and do a good job at it because they paid us 50 of the time. It works every time because they paid us a ton of money together and do it. And so we got to do a good job, but hopefully we'll pull it all off live. [1:21:11] Chad: Justin needs to leave so bad. Look at him. He's getting antsy over there. [1:21:15] JD: Go. We're out. We're done. I. I chose. I chose this week's song. I heard it on the radio. I thought it was cool. I. And then I found the YouTube video. It's. It's not quite as cool as hearing it. Audio only. But Brandon, play it out and everyone will hopefully see you next week. If not, we'll see the week after that. Thanks for being our retireholics family. We love you. And yeah, we are the retireholics, and we are changing the retirement plan industry. One fucking beer at a time, motherfuckers. We're out.