Payroll Integrations & 401(k) Coverage Gaps

[0:00] JD: Would. Why would there be birds in the background? Oh, just because our little thing here. Or is. Does Jeff, like, raise birds in his house or something? [0:09] Jeff: I have. I have a lot of. Whenever I'm on the phone with the senso, I leave the windows open, so some of the gas. You know, that. That he's admitting. [0:17] JD: Yes, I was gonna say I'm. I'm very sorry that you have to get on calls with the senso. Sounds like. [0:23] Mark: Say, why are you doing that? [0:24] Jeff: Yeah, exactly. Hey, guys, I gotta. I gotta put the a. My. My computer's running low. Hold on for one second. I'll be right back. [0:36] JD: Yeah, you're the special. [0:37] Mark: Yeah. [0:37] Justin: 45 seconds, pal. [0:38] JD: Don't run out of power. My lord. [0:40] Mark: Run out of computer. What are you pouring there, J.D. [0:46] JD: little old fashioned. My buddy bought me this little bottle of bourbon. So here we go. Live on the show. Old fashioned in the cup. Yeah, a little bit of simple syrup. Everyone tune in. Let me know if you think I'm doing this right. Just. Just a little bit. A lot. Come over here. Grab the bitters. Just a little dab, dab, dab. Maybe too much. Then what do I have, Mark, what do I have? Little cherries. Little cherries. [1:28] Mark: But the fancy ones, they're not those bright red ones. [1:30] JD: No, maraschino. Maraschino cherries. And when I get them, I make sure I get a little bit of the juice. You got a little bit of that syrupy juice in there? Yeah, put it in there. I stir it up. If I had an orange. Yes, everyone calm down. I would. I would take an orange peel and rub it along the rim. But I don't have time for that right now. [1:55] Mark: I think we honestly need to do that. But make all the drinks wrong. [2:12] Justin: We did that one time, Mark, remember? [2:14] Mark: I know. Remember when we. We gave people way too much alcohol? [2:17] JD: Yeah, that would be a great segment. Like Mark. Mark's bar time and you do a drink. [2:26] Mark: So as we. As we. As we wait for Jeff. [2:28] JD: What? [2:28] Mark: When we went to a conference in Washington, District of Columbia, we just. And I somehow got thrust into a hotel party. [2:38] Justin: And let's be honest. [2:40] Mark: Yeah, we self. Thrusted into a hotel party, and we were behind the bar making drinks. So someone come up and they'd be like, can I get a vodka soda? And I'd be like, no, you're getting a tequila and Gatorade. I would make them a different drink, and they would walk away. And then Justin and I started mixing up everything and just doing all kinds of stuff. And they came back and they're like, make me what you had that last time. It was good. [3:03] Jeff: Be like, we don't know we made [3:05] Mark: you, so we made something else. Like, every time someone asks is I get a beer, we give him a shot of vodka. It was amazing. [3:10] JD: That's appropriate for you because, you know, any times I've seen you get drunk, show up to the bar when we'd be out on the road trip, and then you ask the bartender, usually it'd be a woman. And you'd say, they'd say, what do you want? And you, you'd be drunk and just be like, just make me whatever you want me to have. Just make me whatever. And they look annoyed when you say it the first time. [3:33] Mark: I say. I say dealer's choice. Give me whatever you got. [3:38] JD: All right, our guest. Our guest is back. So welcome, everybody. It's the first Thursday of the month, so welcome to the old school regular format of retireholics. We're glad to have you here. Last time I did a song. This time I'm gonna do a poem. I haven't done a poem in a very, very long time. [4:03] Mark: Was kickoff poem, not a song? [4:06] Justin: No. [4:07] JD: There will be no music to this. I don't know if that's the poems. [4:11] Mark: Always musicless. I love questions. [4:14] JD: I don't know. Another great question. I don't know. All right, here we go. Home. From the bottom of my heart. [4:21] Jeff: Oh, this is weird. [4:25] JD: Many pay. Pay attention, everyone. Many years ago, our path would cross his dream, he said, was cooking with lots of sauce. I gave him a job of a different order. He became an HR warrior. Yes, I'll drink for that. But then the path would change and things would eventually get a little strange. You see, in his new job, he would suit and tie selling and selling until they would buy. Eventually, the strangeness happened. The suit and tie had suddenly slackened. 401k shows all over the globe. And now he was famous for wearing a robe. Yes, the difference between game and lane he could find. But his stock picking skills, well, they would blow your mind. A soapy tub in Vegas won't make him mad, but he gets real excited if the tub contains Chad. The man is so special to me, he could make me cry. And you spell his name with an R and an O and a B and an E and a Y. Thank you. All right, we're gonna go straight into introducing our guest. Justin, this is that time where you've already secured your job. You've done so well at this. You're like one of those veteran players on the team that's never going to get released. So just go ahead and introduce the guests. And anyone that wants to rate Justin on a 0 to 10. Well, you don't rate him anymore. He's earned better than that. [6:21] Justin: Four years of being worried about my job and I finally don't have to. Well, this deep, sensual, throaty sounding baritone is a longtime industry vet who's had his hands in a smattering of areas of our industry since the start of. Since he got his start in the 1980s, he's done some advising, some actuarial number crunching, built out a TPA and sold them for a lot of lambos, became a dcio. Son of a. I just realized what I'm doing. Went back to the TPA side to [6:58] Jeff: what led him into payroll. [6:59] Mark: No, Brandon, wait. [7:00] Jeff: We. [7:00] Mark: We rack him. [7:02] Justin: He believes box water is better, so clearly he's never tasted liquid death. He enjoys taking in a good shirts and skins game in the parks of lower Manhattan. [7:11] JD: That's creepy. [7:12] Justin: Purchasing his new BMW. He made a post on social captain. New captioned New Whip who dis. [7:18] JD: Yes, [7:24] Justin: It's all true, dude. Hashtag wmp. He's a principal and chief revenue officer of payroll integrations. Mr. Jeff, welcome to the show. [7:37] Jeff: That's exactly how it's pronounced. Well done, Justin. [7:42] Mark: Justin, That's. That's five, buddy. [7:46] JD: Welcome to the show. [7:47] Mark: So you sound awful there in Missouri. [7:49] JD: Just so we're clear, the Internet. The Internet ain't so good at Chad's house. New Whip who dis? My lord. Okay, Brandon, let's go to headlines. Headlines, please. New Whip who does I? I. I usually have some things planned out and I. And I do tonight, but sometimes things come last minute to me and I, I kind of add them acapella here at the end. There's a third party administrator up in the Bay area not far from where my father started. Our firm, coincidentally has the same last name as mine, Carlson and Quinn. Roby's shaking his head in acknowledgment. There's been news out that they have been acquired by Strong point partners. So, you know, acquisitions in the third party administrator space. Still happening. But let's go to some bigger news. The boogeyman is back, people. As I said on LinkedIn, if you look under your bed or in your closet and you're looking for that little monster, he's not going to be there because he's back going after retirement plans. And I'm talking about the one and the only Jerome Schlichter. I thought he had moved on from our space because we haven't heard from him a bit and maybe he still kind of has because this one involves some pension plans, not necessarily, you know, for 1K or defined contribution market. And I also don't claim to be an expert in this space, but it's also a little nuance in that it has to do with pension risk transfers. But let's try to tackle it for a second. Jeff, our guest here, you're familiar with the boogeyman, are you not? [9:49] Jeff: I am, yes, of course you are. [9:50] JD: Of course you are. Did you read this article at all here from. [9:54] Jeff: I read excerpts of it when you sent it to me. Yeah. [9:57] JD: Very cool, Very cool. Were you aware of this pension risk transfer that. Because I wasn't. That like a defined benefit plan or a pension plan at certain point can kind of say, hey, we'd like to outsource our commitment to an actual insurance company to annuitize this stuff and pay our. I wasn't aware of that. I'm sure you are. You're an industry vet. [10:17] Jeff: Yeah. [10:17] JD: Okay. And so the lawsuit here from Schlichter apparently is when these, this company made this choice to hire this particular insurance carrier that maybe they didn't do the due diligence that they should have. They weren't benchmarking it properly, apparently. This is a risky firm that. I know. I don't think anything negative has happened yet. But Schlichter feels as though there's. There's a potential for a lawsuit here just because they made poor decisions in choosing this company. That's how I read it, at least. [10:48] Jeff: Well, the only reason they could be may be making bad decisions is A, the company's not rated high enough. B, the company, the actuarial assumptions that they're making actually reduce the amount of money that's going to be paid out to the, to the company. So therefore dropping the, Dropping the actual benefit. Yeah, well, the benefit, but also the net present value of the company. Of the, of the vow, of the, of the asset. So, you know, there's something there. I don't think there's much there, but there's something there. I mean, I mean he can, he can sue anybody for anything and somehow somebody's going to cave. [11:26] JD: True. Most talked about, we've talked about this many times before a lot of these lawsuits. The intention is, as you put it, just to get someone to eventually cave. Right. And come up with some type of settlement. Again, as someone who doesn't understand this space that much, the pension risk transfer, when I Read the summary of it all. I'm like, really? This is enough to kind of go after someone? Like, it doesn't seem like anything really bad has happened yet. You know, the car has not wrecked yet. They're just saying that it potentially could. Although to your point, maybe there's some higher fees. [11:58] Mark: Well, go and I'll. I'm gonna drink for this. But my. Again, yeah, I read that and I was kind of like, I wasn't really aware of that in general, but what got me is when they said when they made the transfer that it avoided, like, being held by ERISA standards. Yes, I'll drink from that. Which again, I don't understand this as much as others do. And I was just like, why? Why would you even do that in the first place? Because, you know, you're impacting plan participants and I. [12:31] JD: Well, let's be clear. It's not. It's not proven that they have sidestep the ERISA requirements. I will also drink. That is just Schlichter's opinion in this lawsuit. And that by doing so, they showed like. Like Jeff said, they chose a company that didn't meet all the requirements, and that is the infraction itself that they didn't follow these guidelines based on that acronym that you just mentioned. Let's keep it moving. I like this. Cyber security. I'm gonna drink for this because I don't really know the name that goes to this. I should, but JP Morgan has a security cyber data breach. Somebody let me know what that very successful man's initial. [13:20] Mark: Jean. Jean Paul. [13:21] JD: I doubt it. And I'm. I'm thinking here, like, if these big companies can't handle their data and JP Morgan handle your data, bro, Come on. Aren't we all in very kind of terrible times? Now, when I dug into this article and I'll drink from my last one, I found out that this isn't a whole lot. This headline's a lot juicier than what actually happened. So apparently there was no. [13:56] Mark: Oh, but I have so many thoughts. I'm excited. But there were no ones. [14:01] Jeff: Get me going. [14:02] JD: Before we get your thoughts, I want to let everyone know there were no real bad actors. There was no actual incident of. Of cyber security where someone actually tried to. There was no attack. They simply like self identified that in working with three of their kind of partners or internal vendors, if you will, that for years some additional data was coming up on reports that shouldn't have data. You know, bank account information, social securities, that type of stuff. So nothing actually bad happened. And then their solution to it is, which is what everyone's legal solution is now is to raise their hands and say this happened. And now it's a big entity. We're letting it be known publicly and we're going to offer to our hardworking employees and people the ability to go get a free account so they can track their credit history. We're going to make a number available to any poor soul that needs to call in and get some help and counseling. Like that's how this stuff's fixed. I'll go to Jeff. After you. Robbie you. Because you got some thoughts here. So explain them. [15:03] Mark: I, I have two separate thoughts. One was again, I just always in reading the article, I like to have a thought to, to pull out of there, which was my first thought was incredibly confused on somebody's reasonable assumption of promptness. Okay. They, they said that this was promptly addressed, yet it occurred and for the first time in 2021. So three years time is prompt. [15:31] JD: I think they mean prompt when they discover it get cut. [15:34] Mark: What are we. Yeah, what are we doing? How could it not be identified before now? I. That doesn't. That blows my mind. [15:42] Justin: With the technology they had to like to JD's point, once they identify that it was risk. Yeah. They noticed it was going on since [15:49] JD: 21, but I don't know, man. [15:50] Justin: 24 hours to notify Jeff. [15:53] JD: We, we talked that you're, you're a veteran in this industry. You've been in a lot of roles and been doing it for a long time. I think your new role definitely would. Cyber security would catch your attention. So let me just ask you generally and you, you don't have to speak to the current company you're at, but just in general, like, how concerned are you in terms of the 401k industry and cyber security and waking up one day in the future to a headline that's far more scary or negative than this. [16:26] Jeff: It's far more scarier. First of all, I must have 10 or 15 of those notices and the opportunity to track my, to track my. [16:36] Mark: You do? [16:37] JD: Okay. Yeah. [16:38] Jeff: Right. Over the next year, you know, wait, [16:40] JD: you buy stuff at Amazon, you've worked with, you've done stuff at Apple, you've gone to Walmart before. Like I get. Yeah, exactly. [16:47] Jeff: So it's like, thank you very much for sending this to me. And then you trash it. But you know, the reality is, is the worst thing that could happen is, is right now there's no money lost. But, you know, everybody says, well, don't worry about borrowing Industry is, is, is, is fine. And we have great, great cybersecurity. What happens one day when somebody wakes up and they're, they find out that somebody's been taking $100 a day off of their 401k plan? They say, well, you know, I've got, I've got $800,000. That's not going to matter that much because, and suddenly you multiply that by the tens of thousands or hundreds of thousands or millions of people that are out there and all they need to do, all those Russians that are in Moscow. Right. Need to do is they go fishing and there's some guy like Jeff K. Jane, you can't remember his name at the end of the day, not because he drank so much, it's because he's a veteran of the industry. But, but suddenly I receive an email and I don't know and I, I, I, I open it up. [17:51] JD: Don't, don't on it, Jeff. Don't click on it. [17:54] Jeff: Yeah. And it goes throughout the system and then suddenly there's a bug in there that begins to eat away at our savings. And then who's responsible? Who's responsible? The 401k company and the bonding company. But is there really enough money out there to be able to save, to save that? I guess the government can come through and you know, throw another 8 trillion out like they did in, in 2020 when we were, you know, we went to the pandemic. But it's a real, real scary situation. [18:23] JD: Have you guys seen the, the movie that came out of the action movie? The Bee Killer. The Bee, the Bee Hot. The Beehive. Yeah, yeah, yeah. [18:33] Jeff: I thought Justin was Jason. Straight them for a minute. [18:37] JD: Yes. You should see it. [18:38] Justin: A few pounds on him. [18:40] JD: Well, that movie kind of starts out the same way. This woman just gets, you know, loses all of her life savings. It's funny that Jeff talks about the little, the little leak ongoing. I've never thought about that. I'm always living fear of like one of my clients, like oh my God, someone does a $750,000 wire of someone's account because people aren't paying attention. Right. And I know you're right. I do believe in our record keeping system, CIS recordkeeping vendors out there and the cyber security they're using. But we all know that the weakest link is usually the human being, to Jeff's point. And so, you know, let's not kid ourselves. You can have a lot of protections up there, but there's, there's smart people out there that'll figure out a way around it. So anyways, that's why I bring it up. I think cyber security is something that we need to not forget about and continue to think about as an industry and not get complacent. Right. And continue to evolve. I'll talk a little bit later about this as we talk about 360 payroll integration because I would think at payroll integrations, the company that you've invested in and are now working to help build this has got to be a pretty paramount thought for you guys in terms because you're accessing so much data on different sides. But we'll get to that in a little bit less. [19:57] Mark: No, wait. [19:58] JD: Yeah, go. What? [19:59] Mark: This point is not going to hit like it would have earlier. I'll just. Because you guys got all serious and smart and major high level executive type marks. [20:09] JD: Sorry. [20:09] Mark: But what I think if I could take my hat off and if I had foil. Put a tin foil hat on is I think Experience got some backdoor thing going on with this stuff. [20:20] JD: Dude, they're funding the cyber threats. Is that what you're saying? [20:24] Mark: Yes. Like, hey, offer your employees free experience if this happens. Because guess what? You're gonna have to pay us. Okay, so we're gonna make a 451,000 people impacted. [20:40] JD: Unbeknownst to us, Mark, underneath the Experian offices is really an underground office space where they have all these hackers hacking into it. [20:48] Mark: Oh yeah, dude. I mean, I'm just saying, like, let's not lose sight of the fact that every time you see one of these things, you scroll down and what do you see? Oh, go access experian free for 12 months. 24 months. [21:01] JD: That. [21:01] Mark: Dude, there's something going on here. [21:04] JD: I'm just saying, let's be clear. We do know why they do that, right? Because that is the current law. Like that's the written. [21:11] Mark: Right? Which I'm saying they're like, hey, this will save you pr. I'll drink for that later on. And when this comes out, we can make it look really good. We'll give you a smashing deal. Yeah, there, dude. There's some kickbacks going on there. [21:25] JD: Okay, fair enough. Be careful out there, everybody though. Be careful. Don't click on the links, don't. Your bank's not going to call you. You know, they don't want to talk to you. And if they do call them back, call them back at the number that you have for them. Let's. Let's spin the wheel of ice. Before I forget who's ringing for Chad. [21:54] Mark: Oh, you're in Missouri. Yeah. Let's go. [21:56] Justin: Good? [22:00] JD: Yeah, yeah. Okay. I don't have an ice, but I do. [22:05] Mark: Wow. [22:06] JD: I do have a mal. [22:07] Mark: Oh, you're fine. [22:10] Jeff: All right. All right. Jeff, are you drinking hot sauce? [22:14] JD: No. Have you never been to Chicago? [22:18] Jeff: I have. [22:19] JD: You must know what Malord is, then. Come on. [22:21] Jeff: Oh, yeah. Okay. Yes, yes, yes. I'm sorry. Some reason I thought he said my Lord. [22:27] Justin: Yeah. Tell us about the history of your family name. [22:29] JD: Oh, that's just. Remember I used to kind of like it. It's gone. [22:35] Mark: I haven't had that for so long, since we haven't been on the road or anything that I. I think that if I had it now, there would. There would be a serious jolt. [22:44] JD: It's pretty bad. It's pretty bad. Okay. I would like to talk about the. The new fiduciary rule, if I may. There's several articles out there. I know. I sent you guys two of them today. Brandon, go ahead and put up whatever one you want or don't. I really don't care. But everyone's heard about the new fiduciary rule, and I'm going to be honest. I don't like to show my insecurities, but I'm a little bit confused. And maybe Jeff can help us out today. But I understand that back in the 70s we kind of had this rule of what is a fiduciary, what's not a fiduciary. And now the government and the Employee Benefit Security Administration. [23:34] Jeff: I don't. [23:35] JD: I don't know if I'm getting that one right. But, you know, it is looking to kind of modernize that and put a new one in place. And I feel like the industry, the industry, some people in industry are pushing back, others are kind of okay with it. I'm going to read you a quote from Lisa Gomez, who's the assistant secretary for the entity I just mentioned. And can someone confirm for me, is that, is this the role that Preston Rutledge had? Because I missed that guy and he was on this very show. That's how important we are. We had that on here. And I think he had the same role that this chick has. She says, quote, put simply, this means that advice must be prudent, loyal, and free from misrepresentation. I feel you, Lisa. And excessive compensation. We don't think that it's too much to ask. It's just honoring the retirement investors legitimate expectations. When I read that and I put myself in the shoes of a consumer, I feel like I like this Lisa Gomez chick, I feel like they're fighting for my rights. I feel like that if people are helping me with my 401k or helping my employer with my 401k, they should be held to a certain standard. Jeff, not to put you on the [24:56] Jeff: spot, but you're putting me on the spot. [24:59] JD: Sorry. Like, I mean, I think most people [25:02] Mark: think that's already happening, by the way. Just gonna throw it out there. [25:04] JD: I think we're gonna go there, Mark. I think that's exactly where I'm gonna go. I think that's very kind of insightful of you. Like how, Jeff, just in general, like, how do you feel about the fact that there's this new proposed fiduciary rule? I mean, now it's really coming. And is it that big of a deal? [25:23] Jeff: It doesn't change from what I saw. It doesn't change that much. They make a few other, you know, a few things more important than they. They may have in the past. But I think the competition. The thought of getting hit with a fiduciary, getting sued on a fiduciary basis because you're helping somebody with their 401k plan. I think the market has taken. I think the market, quite frankly, has taken a. If you've got Fisher Investments on every TV show saying, we're a fiduciary and this is what we do. Yeah, exactly. [26:02] JD: When I say love them, I mean, I hate them, but. Go on. [26:06] Jeff: But it. But I think the market is kind of taking it down. Because what you've seen is. [26:10] Mark: In. [26:10] Jeff: What you've seen is fiduciaries that are plan managers, plan advisors, are reducing their fees dramatically. They're. They're now 70 of what they talk about are. Are how they chose the funds, what. What the funds are doing, how they are the benchmark. And it's like, you know, I'm doing. I'm doing all this for 12 basis points. [26:32] JD: Yeah. Yeah. [26:34] Jeff: I'm going to pay the plan to. Let me. Let me do. Be an advisor on it. [26:38] JD: I've been interesting. We should someday talk about the Fisher Investments ads. Maybe we. If we have an after show tonight, we can talk about it. But let me ask you this. So pre rule, pre new fiduciary rule, we have situations where there's like three 38s out there. So I want to take this down to the core of like a 401k plan and the plan sponsor and maybe even a fiduciary review meeting. And let's say that you've got like, Todd Kading and Leaf House not to give a plug for a certain 338. But. But they're the 338 fiduciary, like literally named in a contract. Okay. And so now we know. Yes, that is a fiduciary. They have that responsibility that. Mark, we get it. If someone wants to sue them for doing something wrong, of course they're labeled a fiduciary as, as they should be. But are we saying in the future that if under this new rule that if Sally Smith, financial advisor, who's under XYZ Broker Dealer, guides and recommends her plan sponsor her client, and maybe she even uses a tool like Fi360 to say, like, hey, these are the funds that should remain in the core menu. Is she now a fiduciary? And what does that really mean? And before, could she have simply denied the responsibility, which I think maybe she could have, and said, hey, I was just using a tool, making a recommendation. The choice in the end was actually the clients to make. And so is that concerning? Is that an issue with everyone goes, [28:16] Jeff: she made the, she made the choice to use that tool. And the tool does not. If the tool does not. If the tool comes out with output that does not provide the, the lowest cost, best performing product. [28:30] JD: And Jeff, are you saying that she currently made the choice in the old rules or that she's the one who made the choice in the new rules or both? [28:39] Jeff: New. [28:40] JD: Yeah, yeah, I agree. Okay, so you're backing up saying so [28:44] Jeff: then, I mean, you basically, you're, you're, you're reverse engineering it and going back from, okay, here's the outcome. It's not that bad and it's not, you know, it's, it's as close to the, you know, the benchmark as we want. But I. What did you do? What did you. To get that outcome? Well, I chose these funds. How did you choose these funds? I chose this tool and this tool. And well, we think the tool is wrong. So therefore, do you agree with me, [29:09] JD: Jeff, that in the past we were hiding under the kind of the cloak of like. No, no, no, no, no. When I say we, I mean that, that specific Sally Smith example, that she was just giving tools to her client and in the end they were actually making the decisions? Wasn't that the game we've been, I shouldn't say game. Isn't that the relationship, the way it's been responsibly kind of allocated historically? And, and in a sense, I don't know whether I'm against or for this rule. Because I'm okay with the new world where you say, no, no, no, Sally, you actually are responsible for what you put in front of your clients and what they choose. I'll tell you this. Tell me, tell me I'm right. [29:54] Mark: You're wrong. [29:55] Jeff: You're right. [29:55] JD: Who's worried about this? It's the big broker dealers and the big financial institutions that have to, in the end take the liability on for all of these Sally Smiths that are running out there doing work. Right, Jeff? They don't, they don't like it. [30:13] Jeff: No, no, not at all. I mean, you also know that how many lawsuits there have been against broker dealers and, and advisory firms that, you know, you would say to yourself, my God, this is, this is ridiculous. Why are they getting, why are they getting sued? Because they made a choice to either use a tool or the, the, the output from that tool is not up to, up to the expectations of the, of the client. Well, it's not going to be the one that's pointing it out. It's going to be another advisor or somebody or another, or an attorney that's going to be pointing it out and [30:46] JD: then to your original points. And maybe this was in the pre show. It's not. If, if that case came to fruition and went to court in front of a judge or a jury, the fact that you're using something like Fi360 or a retirement plan Advisor Group scorecard in the mind of Fred Reich would save you. Like it is a prudent. It couldn't, I don't think in court you could say that those things are not prudent. But the fact of the matter is, what you mentioned, the pre show is you're never going to get there anyways. You're just going to settle. You're going to settle before you get there. So my gosh. [31:22] Jeff: And if I'm LPL or Morgan Stanley or Merrill lynch or bank of America now. But I, I mean, you're gonna sell. Yeah, you know, I, I, if I was in the paper once, that's fine. It's not great, but it's fine. I just want to be there the second time. [31:37] JD: You could, hopefully people realize that you could Google any record keeper, any financial institution of any scale and lawsuit and things are going to come up like this is just what happens when you become a big company. You're going to deal with lawsuits. I don't think it should actually be a bad mark on them that, oh my God, Voy is in this lawsuit or Trans Ams in this lawsuit. Like, come on. That just comes with being a bigger vendor. Like those things are going to happen. Rob Smith, I love you. I adore you. They do not bring up pooled employer plans in this fucking show. Okay? We did that two weeks ago. We had our time. We had our little fun. Do not use my comment bar to spread your filth of cooled employer. [32:23] Justin: It's a chat box, dude. [32:25] JD: Chat box. I'm just kidding. I love you, Rob. [32:30] Mark: Yes, once again, once again, obviously going through that article, talking about it in the way you all did, we just stayed out of your way. But I have to fill in something here because something doesn't sit well with me in that article that at the very end, this guy, this representative, is telling someone in front of many other people to resign, basically instructing her to stop doing this drama. [33:04] JD: Sorry, I didn't bring up the drama. Everyone know you're talking about. [33:07] Mark: I mean, how, how just absolutely asinine is that? [33:13] JD: Just shut your mouth. [33:14] Mark: Do that behind closed doors or something. [33:16] JD: Like, don't power move. [33:19] Mark: Like, I don't know. I just. That was. I read that. I'm like, what an. What an. [33:23] JD: Jeff, I heard you on Rebecca at 4K Marketing's podcast. You're very well spoken. You know what Roby's talking about here, right? Like there's some drama going on in Washington D.C. i'll drink around whether or not this fiduciary rule is a gonna pass legal, like benchmarks, like, or. Or mustard. Like, like they. Because right, this, this happened before. When was it in 20? 19? 16. I forget. It happened in the past in this 16. And it got shot down. Right? The court said this, you can't do this. Department of labor, like, you're not allowed to do this. And maybe that's a Trump Biden thing. I don't give a. But, but it happened. And so they're saying it again now. And what Mark's referencing is on the steps at Capitol Hill in Washington D.C. i'll drink again. There's a fight happening right now about this very rule. Did you read that article? And what are your. What are your political thoughts? [34:23] Jeff: I hate to say it. I don't know. I don't know. [34:26] JD: Fair enough. Basically, I like turtles. Basically what was happening was, you know, when this, this, this legislation comes out, they usually give us all the world. Not the world, this nation, a period of time to like, comment and respond. And we did. And, and what the Republican side, I believe, is upset with Lisa Gomez about is that you didn't take everyone's criticism and Change your proposed rule. The rule looks just like it looked when you brought it to us. And so you had a preconceived notion of what this rule was going to look like. And regardless of the impact that you got from everyone else that you're supposed to legally ask for, none of this has really changed. I think that's a bit of political playing right now. Like, I think there has been some changes to the rule. I think they had some changes around instruction and education. They had some changes where maybe wholesalers wouldn't be held accountable there. There was some, like, modifications made. But anyways, that's, that's what was happening. So just to give everyone an update, I asked Jeff a question that he didn't know the answer to, but I actually knew the answer to it. Because, guys, this beanie wearing surfer who drinks a lot of vodka actually does his homework. Okay? I've been drinking a lot of vodka in my free time and. I set him up for that. That was a underhand. Thanks. [36:03] Mark: Thanks for doing that, J.D. i love pressing that button. [36:06] JD: Oh, I still don't know that that's you. [36:10] Mark: I have like three buttons I can access. [36:13] JD: So that's Harlow. It's good to see Harlow here. Ted Cruz that serves. Do I do the. Am I the right slant? Am I the Republican guy? I didn't know that yet, but it's good to see Harlow. I miss. Remember that guy in the old days, after show, cowboy hat, going at it. I was digging that. Yes. I'm regrowing my flow less. Jeff, I'm about to give you a treat. You're about to get something that you actually didn't expect and you're going to benefit from in a huge way. I know you've been in this industry a long time and I'm sure you know your way around investing and what you think is the right way to invest. But you've never met a savant, someone who was basically put on this planet to do nothing but tell us where to invest. And that's Mark Palmini, that's Robe guy. And the bit, the segment, it's not a bit. It's a legitimate segment. It's called Drunk Stock Tips. Let's do it. Everyone loves it. Robey, I'm sure you're aware, you're probably not aware. It just flows through. [37:42] Mark: Not aware much flows through your blood. [37:47] JD: Peloton came out with news, I believe today. Look it up, people. Peloton's chief executive officer is gonzo. It's. It's a burning ship that's going down in the middle of the ocean. And Roby, when peloton was at $11 and people were thinking like this thing was ready to go up in a big way, he. He went counterculture to everyone and said, sell that. It's $310 today. Roby, I. I'm not going to bore everyone with the audit and the update on all of the wonderful stock picks that you've done over the last. What's it been now, like, 18 months or longer? I don't. I can't remember. I don't know. [38:33] Mark: I don't keep track. [38:34] JD: But I went back and checked, and it's looking phenomenal. I will say if anyone wants to pick a. Pick a fight with you a little bit, maybe you want to talk about this right now. We don't do this a lot. [38:46] Mark: Right. [38:46] JD: Let's talk about a stock that you said would do great but has struggled. It looks like Elon and Tesla. I've hit a bit of a Bumpy Road recently. 50% of the time, every time. Any advice to the people that. On Tesla and. And kind of some of the. The hardships it's facing right now as a stock. Before we jump into your pick, [39:12] Mark: just don't be stupid. Just stick with it. It's a marathon, not a sprint. You know, all those cliche sayings. Tesla's in a great spot, and they will continue to dominate that space of cars because other car companies are trying to keep up with what they're doing, and you don't see half of them on the road anymore. And so once people just sort of settle down and get over the whole cyber truck being a stupid thing that they did or tried. [39:45] JD: Yeah, my daughter wants me to buy one. [39:49] Mark: Robie, I'm surprised you don't already have one. [39:52] JD: I feel like it's the Hummer of today. I feel like I'd be like a guy with like a. A mullet and Oakley blades on. [39:59] Mark: When I honestly, I think it's kind of a. I think this was Elon's practical joke on everyone. To be like, if I could just create a cardboard box and spray paint silver and people will buy it, that means I'm gonna rule the world one day. And guess what? He was right. [40:17] JD: Yeah, we see him a lot in Southern California. Ooh, Nate, I'll take that one. That's great. Yeah, we see that a lot. I'm worried about that. I will tell you that the comic that I went to last night, I saw Seinfeld, Bergad, see Gaff again, Maniscalo, Someone else had at Hollywood last night. [40:39] Mark: Crazy good. Yeah. [40:40] JD: Last night, Hollywood bowl. [40:41] Justin: Awesome. [40:42] JD: With my 26 year old daughter. In the. One of the comics, it was. It was Maniscala, the guy who opened. I'm butchering his. Butchering his last name as Justin did to our guest. He said, elon Musk. He invents PayPal and he gets bored with it. He's like, no, I'm bored with this. Let's do something else. What should I do? Oh, how about I change the car industry? Let's make a gasless car. Yeah, let's try that. Crushes it. And then he's like, I don't know what to do. I'm bored. He looks up the stars. He's like, let's put rockets up in the sky. Let's try that. He's like, what have you done recently about your. You don't have enough turkey in your 6 inch subway. [41:27] Jeff: Subway sandwiches? [41:28] Justin: It was. [41:29] JD: It was hilarious. So God bless him. All right, Robbie. We all want to make some money. [41:33] Mark: Yeah. [41:34] JD: I've got my. My iPhone out. My E Trade account is open. I think I'll drink for that because it's electronic trade, I guess and whatever. We all want to know based on what Nate Moody said, what do you think about the ticker? Tell me this is a real ticker. Yeah. E, A K E. What did you say? Right? Is that what you gave me, Nate? What? [42:01] Jeff: T A E. Take, take T A [42:05] JD: K E. Yes, sir. Look it up. E. Cake. [42:11] Mark: Oh, cake. Jesus. I'm very confused. I don't look at anything. What is it? [42:16] JD: What is it? It's a restaurant, bro. It's a. Tell me the name of the restaurant. The restaurant is the Cheesecake Factory. [42:26] Jeff: Oh, [42:29] Mark: wow. [42:30] JD: By the way, my mother in law loves that place. Jesus. Can't get enough of it. Now, I want to. I want to say for the record, she has diabetes, overweight. What the. [42:41] Mark: Does that matter? [42:43] JD: She struggles to get up from the couch at night, but she loves Esen by oic. Roby While you're thinking about it. While you're thinking about it, Brandon said on LinkedIn, he goes, let's do like a. A randomizer for what stock ro that? [43:04] Mark: And I was like, yeah, don't we already do that? I don't know. Anything going into any. Okay, so. So Cheesecake Factory has a special place in my heart because when I was. When I was a young high school individual, that was like a fancy. That was a fancy place to go, but the closest one was in San Francisco and it was up Top. And it was super nice. And you went there and did you [43:35] JD: get cheesecake at dessert? [43:38] Mark: Rarely, because I don't like cheesecake. So it was. I. I honestly used to think that it was just cheesecake, which I would talk about. I'm like, I don't want to go there. [43:47] JD: Restaurant of cheesecakes. [43:49] Jeff: Right. [43:49] Mark: And so when I went there, I was like, whoa, this place rules. Because there's like a dictionary of a menu, right? It's like 78 pages. Oh, my God. [43:57] JD: Yeah. [43:57] Mark: It's crazy. Well, I don't know how that's sustainable. And from. I haven't been there. I mean, now, where do cheesecake factories exist? Every mall at mall. No, no. [44:11] JD: They're typically. [44:12] Mark: They're not standalone restaurants. They are usually. [44:15] JD: I love how you are strategically breaking this down. Continue. [44:18] Mark: They are. They are typically attached to a mall. Right. And who shops at malls? Usually teenagers. Children. Kids who. Their parents drop them off because they're like, yeah, you'll be safe there. You can't really get into too much. [44:38] JD: I don't want to challenge you. I don't want to challenge. But is that not the mall of, like, the 90s or the early aughts? Like, I. I feel like these days the mall looks like a lot of fancy people. But I could be wrong. [44:51] Mark: No, granted, I'm sure they are. Can you tell? I haven't been to a mall for [44:55] Jeff: a very long time. [44:56] Mark: Okay. But what I do know is I drive by a mall. Both malls that exist in the area I live have a Cheesecake Factory attached to it. Have I been there in the last five years? No. Do I think about it from time to time? Yeah, maybe. Right. It's just. First off, you know, like I said, their menu is extensive. I have heard. I do believe I heard somewhere that they consolidated their menu slightly, which is a copout. [45:24] JD: They. [45:24] Mark: They got suckered into everybody saying their menu is too big. So shame on them. They did have a really good happy hour that I once partook in. But I have no idea what their stock looks like, let alone did I realize they had a stock to choose from. I figured they were owned by a larger entity, which they probably should be. [45:43] JD: Sorry, Robbie. Jeff, did you get your account set up? Your brokerage account? Is it open? Jeff, are you ready to make the trade? Sorry. Continue on Robey. [45:53] Mark: So I'm just gonna say, you know what? Cheesecake Factory's lost its luster. I think their name. Their name in and of itself reflects a very unhealthy dessert that maybe 4 in 10 people actually, like. And so they've pigeonholed themselves with a bad name and bad brand name, and I think that they're going to get replaced. I think other restaurants are better suited with better names and more up to speed menus that are going to take over. So I'm out. I'm down. Nope, no Cheesecake Factory for me. Don't do it. [46:33] JD: I'm about to short that. And Jeff, if you. [46:38] Mark: But if you do go there and if they still offer it, get the Louisiana chicken pasta. It's like, it's like. Yeah, it's 4,000 calories, but it's so good. [46:52] JD: Kanye goes there. Kanye goes there with his chick. Sorry, Jeff. You're going to say something? [46:58] Jeff: Just that I. I like cheesecake. So I. I'd go there each and every time and I'll buy the stock as well, but. [47:04] JD: Oh, he's countering you. This is a. Jeff. Okay, Jeff. [47:09] Mark: Okay, let's put a. Let's put a little bit of a wager on this for a certain period of time. [47:16] Jeff: Okay? [47:17] JD: Game on. [47:18] Mark: Yeah. [47:21] JD: How. [47:21] Mark: I mean, how far. [47:22] JD: How far out? [47:23] Mark: How far out? Six months. [47:25] JD: Let's be clear. Your net worth is a little more than Robey's, so be gentle with him. Okay. [47:30] Mark: A little more, man, but let's go six months. [47:36] Justin: What are we thinking? [47:37] JD: Six months. [47:38] Mark: Six months. [47:39] Jeff: C note for six months. Whether it's higher or lower. [47:43] JD: Yes, yes, yes. [47:44] Mark: Done. Hold on, hold on. A what? [47:48] JD: T note. [47:48] Justin: C note. [47:49] Mark: You know what's that? [47:53] JD: You know what? Jeff, Jeff, Jeff. This, this. You ready? Let's up it to a thousand. It's me against you. I back Roby against you. And what do you want to do? Six months. No, let's go. [48:09] Justin: This better go to a. A charity of some sort, right? We're doing a grand. [48:14] Jeff: 47 cents. [48:15] JD: Yeah, yeah. Lock it in. 33.47. I back Robey. You say it's going up, he says it's going down. Thousand bucks. Me against you. Sorry. Roby to upstage you. I apologize. [48:30] Jeff: You know, the terrible thing is you live right down the street from me. So I can't run, I can't hide from. [48:36] JD: Well, what you don't know is Roby is a goddamn savant. Jeff. So you just up. The guy knows his investments. He never misses. [48:45] Jeff: I'm gonna come. I'm gonna come and get my thousand dollars in my Tesla truck. And I'll take you. I'll take you to the Cheesecake Factory down in. [48:59] JD: That's phenomenal. That's where we'll do it. We'll do it at cheesecake. Roby, you seem uncomfortable with this. Are you okay with that or. No? [49:06] Mark: I'm so uncomfortable right now. [49:08] Justin: You shouldn't be. You're good, buddy. There's no way that thing can't basis. [49:11] Jeff: He's got a sugar high from all of the cheesecake he doesn't eat. [49:19] JD: Roy, I'm just backing you, bro. I'm backing you, bro. Don't worry. I app. [49:23] Mark: I appreciate that confidence, but when it went from 100 to a TH000, I almost lost my lunch. [49:28] JD: So yeah, Jeff, let's get serious for a second. Not that that bet wasn't serious because it is payroll integration. You, you spend your, the greater part of your career, if not all of your career in 401k and our industry and God bless you for that and in a variety of roles and recently at the, can I call it the tail end of your career. [49:58] Jeff: But you sure can lose that thousand [50:01] JD: bucks you decide to Missouri. [50:09] Justin: No, the wi fi here sucks. [50:11] JD: I think this is really. Okay, let me, let me set the stage. I, you know, this, this show is, it's for everyone in the industry, but strategically it's for advisors. And I want people to know that are listening to this live and in the future that you know, Jeff knows what he's talking about. He's seen this from a variety of perspectives. And for you to decide to take your own money and invest in a particular company that's trying to fit into a certain niche. Payroll integrations. The name of the company, Very Creative by the way, works, hey, it's way [50:51] Mark: better than Cheesecake Factory. Okay, good point. [50:55] Justin: Do you know there's a company out there called 360 payroll integrations too? [50:59] JD: Is there? Well, it's important to me, like I'm starting one tomorrow. [51:04] Mark: That's payroll integration. Just take the S off. [51:08] JD: So my point is I see a lot of people come into our industry that want to create fintech and they want to make money or do whatever, but to have someone like you back it not only with your own money, but then get involved in terms of your time, which you wouldn't have to do at this point, you know, you've, you've built a career and certain wealth and whatever. And so to me it tells me that you think this is very serious. You think this has a lot of kind of room to grow and get better. And I mean it kind of makes sense to you when I say it, but let's start there. So the decision for you to say, wait a second. Let me invest in a company and not only put my own money into it, but let me actually, like, get involved and do some here. Like, what was the. What made this happen for you? [51:56] Jeff: First of all, I just spent a thousand dollars on the Cheesecake Factory, so I'm not really that smart. [52:01] JD: You're gonna lose that, but that's okay. You're gonna lose. [52:03] Jeff: I'm hoping they don't go out of business before six months. Is that very simply. You know, everybody, we just talked about fiduciaries and what they do and how they choose things and what kind of what. How you make your presentation to your client. Good friend of mine used to work with me at the Hartford. Chris Miller. He now runs. [52:22] JD: Yeah, another guy. [52:23] Jeff: Yeah, okay. Now runs peos at Emeritus. Calls me up one day and just said, you're. He goes, you got to come with me to the Bay Area. I said, what for? And he said, I was just talking to an advisor. They really. He. He told me about this company. It's called Payroll Integration or Payroll Integrations. It's a couple of guys that are. Have automated integration. I said, no way in the world. They said, it's like ADP to ADP. ADP, payroll to ADP. ADP 401K. [52:57] JD: Remember the game, Jeff? Remember the game? [53:00] Jeff: I did bring my adp. [53:03] Justin: Oh, do not flash that on our show, pal. [53:05] JD: Come on. [53:06] Jeff: Well, so anyway. So this is what. So we. I said, okay, you know, I gotta go to a wedding up there. Let's do it. So we went up there, two young kids, Doug Zabella and Andrew Hallingren, 30 at that time. 30 years old. And they were sitting there in this little Regis conference room. You know, they. I think that there. There was a couple bottles of water there, but I think they were going to charge me for them. And they. They took us through the whole thing. They took. They told us what they were doing. They showed us how it worked. And I said, this is revolutionary. And I just didn't think the very many things in this. In our industry really are revolutionary because I know how difficult it is to compete with adp and adp and adp. I mean, it's that. And, you know, the payroll people at adp, payroll people, paychecks are great people. They give us. [54:00] JD: Hey, Jeff, you said this on Rebecca's podcast. Let's remind everyone. What I say to people is, hey, as much as. As we throw at. What are they called, actual deposit processing. I have no idea. [54:17] Mark: Processing. [54:19] Jeff: You were so close. [54:21] JD: Automatic processing. Yeah. Whatever them. They've been Killing it. For the last 10 years, they lead plan sponsors rankings in terms of one and two total plans sold every year. You gave a stat not to put you on the spot again, but on Rebecca's podcast where of the what, 700,000 plans across the country, they have what, 190,000. 190,000. So they're kicking everyone's ass in this. And what you said in Rebecca's podcast was that, yeah, they're doing it because they're saying, hey look, if we can integrate into your payroll, we're going to make this way easy for you. You guys on, on Rebecca's podcast talk about 60 to 100 hours saved each year. I think it's more than that and I think that it's, it's way more valuable to say to a plan sponsor that if you don't have to submit your census at the end of the year to a third party administrator and, or all the other things that go along with a360 integration, like changes in payroll, I'm upping my deferral from 4% to 8% or declining it from 10 to 8. Like these are all timesavers. I forgot my point is because I've been drinking a lot of bourbon but you very well on the show and yeah, I forgot my point. I'm sorry everybody. [55:49] Jeff: You're, you're absolutely right. We, it's not, it's not we that are saying 60 to 100 hours. It's really, it's the marketing pieces from ADP and, and from paychecks are saying when you have the, what they say is when you have the record keeping company or the record keeper talking to the payroll and we get, you know, and so, and creating that 360 integration, you know, you, I mean you guys talked to, you guys talk to plan sponsors every day. The one thing that they hate and they hate with a passion, with the deepest, darkest hatred is submitting. But payroll, going, setting, sitting, sitting there and, and spending hours at a time especially, you know, you guys probably have trouble. [56:39] JD: We hate it. We don't like it. We, we, you know, you've been in this side of the business and, and you, you've, I'm sure you guys are working really well with third party administrators all across the country. We don't like gathering census. It's a pain of, in our ass. I guess my point there, there I go. My drunkenness is coming back. I, my point was, is that paychecks and automatic data processing have been killing it. And you said this. I'm stealing from you. One of the reasons that they've been killing it is because of this ease of working with them through this payroll integration, which makes total sense. And I could try to poke holes in it. And like a lot of third party administrators across the country, I could try to tell you why they suck. And, and that's horrible. And then the work or the quality of their work is going to be bad because of it. I think what I heard from you on Rebecca's podcast was a better vision in the future of like, look, this is what they want. They meaning plan sponsors, clients. And if we're going to compete with not only paychecks and automatic data processing. You said we also have seen success. You said this and we've talked about this on this show from Human Interest guideline, Betterment. These are companies that have gone out to the market and by the way, we've talked about this many times on this show, have blown away expectations in terms of the number of plans they brought on, whether startup or small takeovers or whatever. Like, I'm sure you'd agree this guideline and human interests are. They're killing it in terms of how many plans they have, whether or not they're profitable. That's a whole different conversation. But I think they've won a lot of small plans because they've advertised the simplicity of data from. You said this on Rebecca's podcast. That was the first thing they led with, which was we're going to integrate with your payroll provider. And you're totally correct in saying that. And so I was actually inspired to hear you say we can compete with them as an industry. And I'm not trying to prop up payroll integrations, but maybe I am here. [59:07] Jeff: You're doing a great job. [59:08] JD: We thank you. We can all compete with paychecks. I'm going to say this because I want to drink. ADP Guideline, Human Interest, Betterment. Whomever you mentioned best. Well, but I'll put, I'm going to put Aaron in a different category. If we use something like what you're representing and, and, and helped bring to fruition, we can do that too. Is that your point? [59:36] Jeff: Yeah, absolutely. [59:38] JD: Expand on it with that sexy baritone voice. [59:43] Jeff: It's, it's very simple because what, what you see is probably a lot of the plans that you take that you guys take over started out as an 80.80p or, or paychecks plan. [59:55] JD: Anyone keeping a tab on his drinks? You owe a lot of drinks for all you. [1:00:00] Mark: I can't even chat. [1:00:01] Jeff: I'm not sure he knows I told, I asked you, I asked you to give me the rules. [1:00:05] JD: What did I say to you, Jeff? [1:00:07] Jeff: I think it started. You said, you know, it's. If they're not that complicated, don't worry, you'll learn as you go. [1:00:14] JD: Yeah. [1:00:16] Jeff: Hey, hey, Jeff. [1:00:17] Mark: You did. You didn't learn. [1:00:19] Justin: So basically, anytime you say an acronym, you got to take a drink and [1:00:23] JD: I think I'll crack a beer and it's called a, I don't know, spotted cow. [1:00:31] Mark: Go. [1:00:33] Jeff: I've got the Newcastle Brown anyway, so. [1:00:36] JD: Whoa. [1:00:36] Mark: I haven't seen Newcastle forever. [1:00:39] Justin: Well, I'm back in tans with him. [1:00:41] Jeff: This, this. I got this in 1985. So. [1:00:44] JD: Yeah, tell us, Jeff. Everyone listening in? Like, seriously, like 360 payroll integration. [1:00:49] Jeff: Like what, what we do is we, we create the same integration that Paychex has with. Paid it with paychecks, 401k and ADP had eight automated. Yeah, he's good with their 401k and with 45 different record keepers. So from, from everyone from. And I, I don't want to leave anybody out, but I can't. I'm not going to go off from a census to Voya to Transamerica, which was our first major one, to a number of. A number of companies like TPAs that are using Empower. [1:01:30] JD: Empower. [1:01:30] Jeff: No, Empower was a funny story, but [1:01:33] JD: Empower, yeah, they were. I get it. [1:01:35] Jeff: Yeah, yeah, yeah. You know, I could, you know, I can go on and on, but a lot, A lot of companies that are using relias as a, As a back. As a. So Schwab third party administrators using Relias and. Or Schwab record keeping technology. So anyway, so we have about four. As I said, we have about 45. So what you see is, you know, the client. The client leaves one of the 360 integrated companies and they go to Empower and they're using. Or John Hancock, they're using you guys as a, as a third party administrator. And the first thing the client says is, why do we have to input all this data? Well, what do you mean? Well, when we were at Paychecks, we didn't have to do that. And now I'm at Empower and I'm with Katie Carlson and I'm with, you know, but I'm still with Paychecks, payroll. What do we do? And you say, well, I, you know, we, we have, we have lower costs. [1:02:47] JD: Yeah, yeah, I get it. It's a bummer. And I, we all agree with you. A client, of course, by just looking at the Success of the companies you've already mentioned. The client would love to hear a story where they could spend less time submitting census, dealing with the 401k and the back and forth between payroll and record keeper. I think we can all agree to that. And if you can't, you're a idiot. Okay, so the, the next like evolution I want to talk to you about is like the nuance of it and the quality of it. And I don't want to like be the like argument guy for the third party administrator that doesn't like this because I want, I want any third party administrator listening in. And I'm not trying to do an ad for Jeff or payroll integrations. But like they're your biggest friend, they want to partner with you, they'll help you do a better job. But my question is about payroll.360 data and is it not. Is it perfect? But, but where are the flaws in it? And so when, I'll put it this way, when I used to rip on paychecks as a third party administrator, and this is 15 years ago, I would say look, yeah, they've got your data, but they it up. And because you're sitting there as a plan sponsor of a 401k plan under the laws of ERISA, I'll drink. That has lots of rules and lots of really nuanced rules. You're using paychecks to set up your payroll and just pay people. You're not thinking about the provisions and rules of your plan. The Family Feud survey says number one answer would be like a definition of comp. Right. Definition of compensation. Like is it, is it the same that's set up in your payroll system as it isn't on your adoption agreement to your plan? And Jeff, you've been in this industry, so I know you got to know this. You have to think about this a lot. Like I want payroll integrations, your company that you're working on with your partners there to like succeed. I want our industry to become 360 integrated. So I don't want to come off as the opposite. But my issue is payroll needs to be run in a professional, cognizant way to understand the how it mixes in with the provisions of the adoption agreement and the retirement plan. And unfortunately in small and micro business that is run by business owners that are mom and pop shops, you know, sock coverage gap, whatever, not to derail everything. That's really hard. That's a hard ask. And so what do you. And I'm trying to, I'm not trying to put you on the hot spot, but what do you say? Because I'm a fan. But what do you say to me of. This is not the. Just like the easy button answer. Like there's problems here. If you think just sinking into your payroll solves your problem of a 401k plan, go at me, Jeff, and, and take the gloves off like. [1:06:19] Jeff: Well, you're absolutely right. First of all, most of the, most of the problems we have because people fat finger information, you know, JD car, okay, every 13 digit Social Security number. But what we do when we onboard a client and we were on board, about 15 a day or actually more than that. About 20 a day. [1:06:39] JD: What? 20 a day? [1:06:42] Jeff: Yeah. [1:06:43] JD: Mark, do the math. Justin, do the math for me. That's insane. [1:06:46] Jeff: Maybe. I'm sorry, I'm sorry. 22 days. We do have a little over 300. 300 plans a month. [1:06:53] JD: So that you're bringing on to payroll integrations as a system. [1:06:57] Jeff: Yeah, that's. [1:06:59] JD: I am not attacking that. I'm saying that that's valuable information for people to hear. Like that's huge. Okay, go on. [1:07:06] Jeff: So what we do is we will receive. We ask the, the record keeper and, or in your case the tpa. We need all of that information. So be what, you know what the, what the plan has in it is have a Roth provision. Does it have a catch up provision? What is, you know, what is it, what considered income? Are there, are there union people? Do they have to be, do they. They have to be very large. [1:07:33] JD: We have husband, wife, spouse, daughter, son. I mean, Jesus. Yeah, right. [1:07:40] Jeff: Those are, those are in the very, very small plans when that, when that is concerned. But you know, our average plan is about between 50 and 100 people. And. But you know, we have a lot of. [1:07:50] JD: Jeff, I would, I would take kind of argument in that the more people you have, the census gets bigger. The more ripe it is for those types of errors. [1:08:06] Jeff: Okay. [1:08:07] JD: The company, the more you're gonna find those ups. Like it's not a small company problem. [1:08:12] Jeff: I'll agree with you but it's, you know, you may not. In a larger company, you may not have the. Half, all the, you know, all the family members in there and how they're, they have to be. [1:08:22] JD: Come on, Jeff. No, no, no, I'm not sure. I've. I've done plenty of large companies. Jeff, come on. I've got big companies, 500 employees, are you kidding me? That's when they've got family members riddled through all that. Like [1:08:37] Jeff: we, we can only get the information and only put it into the, into the payroll file. The way you give it to us or the way the Keeper gives it to us. [1:08:47] JD: I don't like hearing you say that. I love you, but I don't like that. But I get it. I understand it. No, no, no, I totally get it. I, if I was in your position, I'd say the same thing. But my problem with this is, remember, remember, Jeff, and I mean this from the bottom of my heart. I'm on your side. I want this to work. Like, I think this is the answer for our industry. I was so inspired hearing you on Rebecca's podcast saying like, like, if I was a regular TPA just out there in the world floating in the wind, I'd be like, this is our answer to Com. I'll drink to compete with like everyone. And I think that, that you are like a visionary. You're like the young Timothy chalamy in Dune 2. Like, I wanted to follow you and [1:09:37] Mark: go along, but wasn't he younger in Dune 1? [1:09:40] JD: I don't, but, but, and I, I'm still on board. But I just want us to all recognize that there's some issues with this. Like, there's some problems with this. Like, the data is not as simple as it seems. Now if we all want to just kind of move along and be like, well, yeah, there's going to be some mistakes. If you can't run your payroll and do right, then you're going to have tainted data that goes into your 401k and so be it. But I don't. Let me give you an example. You ready for this old school TPA. I'll drink. I should be at ASPA. Example. And this is literally from like 20 years ago. I take over a 2 million dollar plan. Everyone knows I'm good for the drinks, right? I take over a 2 million dollar plan from paychecks is a small company, maybe like 40 employees. And, and they've got this sink 20 years ago in the sense, obviously, because it's paychecks, right? And I, I, I literally went in with my father. You know, my father Jeff. You guys have hung out before. I went in with him. And this is the time when I wore a suit and tie. I had cufflinks on and short hair, no beard, went in and we won this plan. And the, the business owner called me back a year later, Maybe it was 14 months later, because his plan had failed the actual deferral percentage test for the first time in 10 years. And he goes, JD, I want to see you in my office downtown San Francisco next week. We're going to discuss this. And I'm like, okay, can you send me, like, I'm, I'm looking at the information, trying to figure out like, what happened. So I go to my team at plan design consultants and it's not an ad because any TPA that was not on purpose. I said, let me look at the last few years with paychecks and why are they, why are they failing their test for the first time when they come with us? That was his complaint. The first time I hire you guys, I've passed my task for years and now I failed. I'm like, oh, what happened? What happened? What happened? Yeah, Hackler already knows. And I go in and I look and I find out that at paychecks, if you didn't use the payroll system to put someone's date of birth in, it would automatically. And again, this is literally ages ago. But it would, it would automatically. And maybe they fix this, but it would say, oh, well, you haven't reached the retirement plan's age of 21 to participate in the plan, so you're not an eligible participant. So you're a zero on the actual deferral percentage test. And they literally had like 15 of their 40 employees or whatever that were actually zeros were not included in the test. And so I had to walk. Jeff knows. Hopefully if someone's tuning in, you're getting it. If not, I apologize, but I don't. What is happening? [1:13:11] Justin: Okay, a little acid reflux. [1:13:14] JD: What was that? Yeah, Justin, you nailed it. [1:13:17] Mark: Did you just swallow, throw up? [1:13:18] JD: Like, what's just happening? I'm better now. I had to walk into his office. I remember his corner office. Like he had the classic corner office. All this powerful man he had on his shelves and, and going, and be like, and he's like, you up, jd? And I was like, no, no, your past provider up forever. Because these people were eligible for your plan and paychecks thought they weren't because of the way that your human resources person was, you know, dealing with the software. And so again, you know this, Jeff. My point is software is great, data is great, but it's kind of this kind of analogous to like the cyber security thing. But, but people are in charge of it. And if it's not done correctly and, and don't, don't get me on the 100 person, 500 person, thousand person, even the 75, even the 50 person plan, get me on the coverage gap. How is this actually going to work in the Micro small startup market. That was a long winded. But I mean it from the, that [1:14:38] Mark: was so, that was so worth it for that one clip right there. That was so good. [1:14:42] JD: The acid reflux. [1:14:46] Jeff: Well, it was. Jeff Brain, you know, you get in, you get out. I mean we have to be able to do that. But that's one of the reasons that we, we really enjoy working with third party administrators because they catch that stuff pretty quickly. But also, you know, when we, when we load the, when we look, you know, we do test files when once we onboard the client, send them to the record keeper. So the record keeper is also checking to see who's eligible, who's not eligible. Are they, are they appearing properly? [1:15:19] JD: Okay, yeah. [1:15:22] Jeff: But are there going to be mistakes? Yeah, there probably will be mistakes, but [1:15:25] JD: I like that answer. [1:15:27] Jeff: We haven't been, we haven't been encountering that stuff. Most, most of mistakes, Most of the mistakes that happen are because of bad input. [1:15:35] JD: Jeff, you know this. And so I'm not trying to like stand above you and say this, but mistakes happen at those vendors you mentioned. Payroll and automatic data processing every year. [1:15:53] Jeff: Yeah. [1:15:53] JD: And they're never, they never come to surface because those, those are small plans. They're not going to be audited. They're, they're not going to go through any type of government audit. And so it's just the, the, the blind leading the blind. They, they're like, they don't know that things are going wrong because they're not servicing. Like imagine you assigned three HCs to be NHCs or vice versa. Or there was a son of an owner who, who should have been an HC but isn't. We're kidding ourselves if we. Oh geez. Yeah, sorry, that was not on purpose. I will drink. Hang on. We're kidding ourselves if we think that all these, would you say 70,000 plans. How many plans run by ADP and Paychex? [1:16:45] Jeff: About 190,000. [1:16:49] JD: If I, if I audited those plans and I could go in with a Sherlock Holmes, you know, detail analysis to see if they're properly analyzing whether who was an 8 highly compensated employee. Check swing non highly compensated employee. This, this and that. I guarantee you I would find a lot of mistakes and a lot of poor actual deferral percentage tests. A lot of poor employer contributions, not poor, sorry, inaccurate employer contributions, matches, etc. Just because you, you're relying on, sorry Mark, auto body shops, corner flower shops, people to like use the software that, that really don't know how. And I'll leave it at that. I, I No, I think I meant to do that. [1:17:46] Jeff: I think you make a valid point. But we, we've not income. We've not really. Well, you know. Yeah, there's mistakes that have been made. [1:17:54] JD: But you know what, Jeff? If I jumped in your bandwagon, I would say, well, if they're gonna do it, then why the don't we do it too? You know, and you're kind of the advocate of our industry, so I'm definitely not like going hard at you. Like, I love payroll integrations. I'm actually just. Disclaimer to everyone listening. I think my company needs to get more involved with payroll integrations. And I think I need. Mark's agreeing. I think I need to let my clients know that this is an option for them. So I, I'm on board with you. Like, there's been other guests on the show where I want to attack them. I'm not trying to attack you. I'm just trying to attack the concept. Like, I believe in payroll integrations as a company. And by the way, as much as I bet against Cheesecake Factory, thank you. I, I bet for what you're doing as you, you're gonna, you guys are gonna crush it. And you already are. Like, you need me to say that you're killing it. And I love the concepts. I heard about. You're even allowing third party administrators to access payroll information even if their client isn't going into a 360 integration with a record keeper. [1:19:15] Jeff: Right, Right. So let's say that you. Well, let's say, let's say you're not using the client's not using us for whatever reason at this moment. Nobody's brought it. Brought us up to them. So let's say that you have a, A fidelity plan which we're not integrated with at this time. We're hoping to at a later date, but we're not at this time. But because we have the, because we have the integration at the payroll side. So we have all of that information for that plan. So all you need to do is request that just plug into our system. You can list all you can. You can just put in the plan, we'll grab nominal. We have to. We have to onboard the plan. But it's. [1:20:01] JD: Jeff, Jeff. Can I, can I use the thousand dollars that you owe me to pay for that for each client? Does that work that way or no? [1:20:09] Jeff: 150 bucks a pop. [1:20:12] JD: No. It's well worth it, by the way. [1:20:14] Jeff: Yeah, yeah. Every. Every tpa, that every third party administrator. [1:20:19] Mark: You can't correct yourself [1:20:23] JD: Very well worth it. [1:20:24] Mark: Yeah. [1:20:24] JD: Your fee is. [1:20:25] Jeff: Yeah, I'm going to do this, and I'm going to pass it on. To pass on the client because the client hates doing it. I remember sending out those pack when they were. When they were real. First thing they do is they go, you know, it's like Scarlett o'. Hara. I'll think about that tomorrow, you know, and then tomorrow becomes February 18th or something like that, and you're hoping to run into them at Bonds and. And see if they have that information. [1:20:54] JD: I absolutely hate it, and I apologize to you, Jeff, and everyone tuning in, but we got to do one more thing before we shut it down. It's the longest show ever. [1:21:05] Mark: No, no, no, no, no, no, no, [1:21:07] JD: no, no, no, no, no. Okay. [1:21:10] Mark: Nope. [1:21:10] JD: All right, Chap. Our champion. The vote for champ. Our champion from me is Ryan. No, it's not. It's Nate. Woody. Nate, Woody. Named Moody. Name Moody. [1:21:23] Mark: Nate Woody. [1:21:27] JD: I almost just drank from the maraschino cherries on that. [1:21:33] Mark: Oh, Nate. Woody is great. [1:21:36] JD: Nate, I love you, but some of your shit's a little. Come on, bro. But that's why I'm voting for you. So let's go. [1:21:44] Jeff: Congrats. [1:21:45] JD: Oh, yeah. [1:21:45] Jeff: See? [1:21:46] Mark: See? [1:21:46] Jeff: There you go. [1:21:46] Mark: J.D. [1:21:49] JD: new car. Who dis? All right, Justin, [1:21:55] Jeff: you're muted. [1:21:55] Mark: Dude, what's going on? We can't hear. [1:21:57] JD: Muted his voice. [1:21:59] Jeff: The whole. [1:22:00] JD: All. [1:22:00] Justin: All that. Johansson just came back in, and the mic is not great. Anyways. [1:22:03] JD: Oh, I get it. [1:22:04] Justin: It was tough. [1:22:05] JD: The 12 year olds with their boyfriends and. [1:22:08] Justin: Yeah, it was tough. It's between him and Harlow. But Nate got me within Ro's idea of a best interest rollover usually involves pillow talk. He's got my vote. [1:22:17] Jeff: Who. [1:22:18] JD: Who's. [1:22:19] Mark: Who's Wood? Woody. Woody. Woody. Got your vote. [1:22:22] Jeff: Woody. [1:22:22] Mark: Yeah. Woody. [1:22:23] JD: Woody. [1:22:24] Mark: Woody. That's just his name. Now it's Woody. Yeah. [1:22:29] JD: Oh, it's. [1:22:29] Mark: No, it's not even Nate. [1:22:31] JD: It's just two for Nate. Two for Nate. Got it, got it, got it. All right, Roby. [1:22:34] Mark: Don't worry. [1:22:34] JD: Jeffrey. [1:22:35] Mark: Harlo. Harlo. By in a landslide. [1:22:38] JD: Come in. Way to go. [1:22:40] Mark: No, no, no, you can't. J.D. because you picked Woody. Okay? You can't back me on Harlo when you pick Woody, all right? [1:22:50] JD: In the chat bar. [1:22:51] Mark: Okay, so Harlo comes in. I mean, he's been on the. This, the. I think we're on the after show and on the DL for, like, I don't know, three years maybe. Like, hasn't thrown a pitch, comes in and just. And Just dominates. Like what? [1:23:09] JD: Whoops. The chat bottom, Shane. [1:23:11] Mark: I mean, get your stuff together, guys and girls. [1:23:15] JD: All right. All right, Jeff, your vote for Chop, our champion tonight. It could be anyone in the chat where you think deserves the prize. [1:23:25] Jeff: I think Nate Moody's been pretty cool, but I'm gonna call him as well. [1:23:29] JD: Well, you need to go both, so. Okay. Perfect. Perfect. Jeff, right? Jeff, I want to thank you for being a guest on tonight's show. It's been phenomenal. [1:23:48] Jeff: I have. I haven't seen enough of these shows that I'm gonna have to watch a little bit more. [1:23:51] JD: Don't. [1:23:52] Mark: Don't do it. Just watch yours on repeat. Yeah. [1:23:55] JD: Yeah. Do you even 401k, Jeff, you're not watching this show. [1:23:59] Jeff: I'm a Cheesecake factory. [1:24:06] JD: I can't wait for the retire hugs Instagram post in six months when Jeff's handing me a thousand bucks at Cheesecake Dude. [1:24:14] Mark: I. I put a. I put a calendar reminder on November 2nd to check. [1:24:18] JD: Oh, my God. Yeah, it's gonna go Zarayou's. [1:24:25] Jeff: Luckily, I've lost money on. On worst bets, so. [1:24:29] JD: Yeah, no worries. No worries. [1:24:31] Jeff: You're gonna. [1:24:31] JD: Yeah. You never had a chance of this one, but it's okay. And. Yeah. So we appreciate you. Everyone out there in the audience. We love you. Oh, my God. [1:24:42] Mark: Thank you, everybody. Except for Woody. Yeah. [1:24:46] JD: And so let me break the chap. Our champion tie. [1:24:50] Mark: There's no tie. It's Woody. It's Woody wins. Woody wins. But Harlow deserves a lot. [1:24:58] JD: No, it's not what he wins. I'm pulling full communism here. [1:25:04] Mark: Oh, and I'm saying what? He's gonna get so mad. [1:25:09] JD: Harlow wins. And Harlow wins for his cowboy hat from 18 months ago. Harlow wins for his goddamn vigor, His. His rawness. It's Harlow for the chat bar champion win, period. End of story. Bam. Sorry, Moody. I love you, but. All right. It's been another super retire, and we are painting. [1:25:44] Mark: Bye, jeff. [1:25:44] Jeff: Thank you, urban. [1:25:45] JD: See, everybody. [1:25:46] Jeff: Bye. [1:25:47] JD: See you next time. Peace out.