SECURE 2.0 & Swing Pricing: What Advisors Need to Know

[0:03] JD: Yo, yo, yo, yo. Ho ho ho. Merry Christmas to all and to all. I don't know. Okay, you know how this works these days we're just going straight to headlines. That's all anyone's here for. They want to hear our banter. They don't want to hear Mark's cough. They just want to go straight to headlines. So, from the national association of Plan Advisors. Don't know why I picked those guys. They wrote an article called Clock Ticking on the Security and Exchange Commission. I get that right. Controversial swing pricing. Ooh, swing pricing. Sounds sexy. [0:45] Nevin: Proposal. [0:47] JD: I, I read this article and I'm not joking, I'm not trying to make fun of myself. I read this article, very interested, very open minded and I got to the end of it and I didn't understand a word that I was, I, I, [1:01] Speaker C: I was gonna say the same thing. I need one of you two to explain this to me because I think I kind of understood. I really don't know. [1:08] JD: Yeah, I got your halfway through. Good. So you guys are, I feel so like a partnered with you. So what did I do? I wrote Nev in an email and I said, hey, this sounds important to me. Like I feel like this is impactful, but I don't understand what's going on. Do you? And is it important? And he's, he wrote me back and said yes, it is. So Nevin, tell me what the hell is going on here? Like, I feel like this could impact 401ks in some kind of, from a record keeping perspective, some kind of negative way, but I'm just not quite getting it. [1:41] Nevin: Well, this is a big deal. And, and those of us who have been in this business longer than some of the rest of us would probably remember how we sort of got this. But you all know the standard way that record keepers do things now is participants can call in board in a distribution or a loan, do a transfer. Like up until what time? [2:03] JD: Close of the market or something, I don't know. [2:04] Nevin: Yeah, until the market closed till like 4pm Right, 4pm Eastern. And all those trades kind of come in and the, the record keepers kind of net them all out and they come up with net transfer numbers and they communicate those to the fund companies and money changes hands, doing all the [2:20] JD: accounting on the, the values of the investments, etc. Etc. [2:23] Nevin: Right. Well, and they, everybody's able to do this now, but once upon a time, only the mutual fund companies who shall remain nameless were really in a position to do this because the trading desks were like right next door. To them. Right. And so the rest of the industry, we do all the same kind of work and we'd give the information, but it would go to the fund companies basically after the market closed. So we would get the next day's price switch. Those fund companies gleefully replied to or labeled it as being yesterday valuation. Okay. Which was clever but really painful for those of us who were in that category. But now it's. The rules have been fixed and so basically you get. You're approved to do that kind of trading with the mutual fund company. You can do that and you do it after. Take the trades up till 4 and you get the information to them later. The SEC looking back to Covid. [3:18] JD: Finish your thought. Keep going. [3:22] Speaker C: He just worried about. [3:23] Mark: While he did that. [3:27] Nevin: They are concerned about market volatility. And as a way to do this, they basically want to limit it so that the only people by 4pm Basically, the fund companies have to have the transactions in their hands. [3:43] JD: I don't know what that stands for, but it's a time thing. [3:46] Mark: Yeah. Not day, but tonight I'm gonna say it's. It's two letters, so screw it. Nevin's smart enough. He should know that. [3:52] JD: He should. [3:53] Mark: Yeah. [3:54] JD: Is this when you say the word volatility? [3:58] Nevin: Yeah. [3:59] Mark: I don't think he was done with his thought. I don't think he was. [4:01] Speaker C: And I'm still not fully there. [4:02] Nevin: So the bottom line is the record keepers are all going to have to do their business. They're gonna have to cut off trading sooner so they can get this information to the record keepers or to the fund companies by 4pm or they're going to be doing yesterday prices like the all of us used to have to do. Now, this is not a new idea. That infamous securities Exchange Commission had the same idea back in the early 2000s. Okay. Again, coming in the wake of the whole tech blow up and things like that. So it's not a new idea. The industry has fought this off before and pushed it back and we're going to apparently have to do it again. We, we have talked to the [4:42] JD: WE meaning the American Retirement Association, WE meaning [4:45] Nevin: the American Retirement association and have expressed our concerns and reminded them that we've been down this path before. At least at that hearing, they were not impressed. So it's out for comments through February 14th. Everybody should chime on this thing because if it goes through, it's really going to mess things up. So it is a big deal. [5:08] JD: It would be a competitive disadvantage and negative for just record keeping in general. People who wanted to expose it could. And it would look like we're not really getting things done timely or it's a disadvantage. [5:23] Nevin: I mean. Yeah, I mean, at some level. I mean, first off, we all know that most people don't trade in their 401ks. [5:30] JD: Yeah, we're not supposed to be trading this stuff every day. Yeah, yeah, yeah. [5:33] Nevin: No, but you might want to do it on a day. And given the market volatility, you might actually on a particular day either want to buy in or sell out, and this would affect that. So, you know, again. But the biggest thing is it's going to require communications to participants. You're gonna have to tell them that the rules of the game have changed. And that's always so much fun. [5:52] JD: You know, you don't even think about it. But it probably changes, you know, the, the technology and the programming and the coding and the. The internal operations of record. I mean, two, that's a cost when they got to change how they actually do things and make sure that it's done right and checked. Why? Why? Because I'm still like ch. Get what you're saying. I get why it's a potential negative. But why do they want to do it? Are they worried about, like, that people are being a Santa? A Santa would refer to it being naughty after hours. Like, is this a security thing? Isn't a. They're not. [6:25] Nevin: They're not actually targeting 401k plans. [6:27] JD: Right. [6:28] Nevin: They're just 401k clients who just get caught up in all of this. But yes, there is a concern that people are out there and that they're. They're doing things. They're basically trying to take advantage of the market. And some concern that people might, you know, kind of seeing what's happening with the market then placing their trade. Sure. To sort of take advantage of it. And you know that that part's not an illegitimate concern. And the securities Exchange Commission wants to rope them off and do something about that. More power to them. Our point has been that's not the 401k system. That. That system does have controls and things and, and processes, and it's really going to disrupt things if they. If they put this on. So it's a big deal. [7:07] JD: If the all in mighty and powerful robe guy wants to chime in on this, he has till sometime in February or something to kind of put his [7:15] Nevin: 2 cents in Valentine's Day. [7:18] JD: Okay. [7:18] Nevin: How precious. I'm going to. [7:20] Mark: I'm going to need another review of all this because even though I browse through the words that in the article. And then I heard Nevin speak for the past eight and a half minutes. I still don't really understand what's going on. [7:34] JD: Yeah. Yeah, me neither. Really? Me neither. [7:38] Mark: Evan, you had to give us a four minute background to get to your point. And even still I don't. I don't think I fully grabbed. [7:45] Speaker C: I got you now, Nevin. [7:46] JD: I got you. I just want you not to. [7:49] Speaker E: Mark. [7:50] Mark: What? [7:51] JD: Were you actually listening? [7:52] Speaker E: Zone out. Were you listening? [7:53] JD: We made. [7:54] Mark: Not even a little bit. Yeah. That's why we may well be like it was. [7:58] Nevin: Have. Have you ever transferred money in your 401k account? [8:04] Mark: Transfer money into it? [8:06] Nevin: Oh, no. [8:07] Mark: Every. [8:07] Nevin: Every day period between funds. [8:09] JD: Change your investments? [8:11] Nevin: Of course. Have you ever changed your investments? [8:12] JD: Are you kidding me? Nevin. [8:13] Mark: Hey, hey, Nevin. This is how you should have started your answer. Okay. To someone like me. [8:18] JD: Okay. [8:18] Mark: Have you ever done this? Yeah. So now what's happening? [8:22] JD: So when you. When you look at that investment and that mutual fund has a net asset value of $13 and you think you're making that trade, it might. You might not really be getting 13. You might be getting 11 or something because it trades later or something. [8:38] Nevin: See, I think that somebody who, who traffic. Understand stock tips would. Would have a greater grasp of this. Yeah. [8:46] Mark: Nevin, you don't understand all that stuff that you all think about. That's why you're always wrong. It's because you gotta not think about that stuff. [8:56] JD: I think someone had spiked Mark's NyQuil. Okay, let's move on to the. The next headline again from those lovely people at the national association of Plan Advisors. What a proprietary show we have today for articles from Nevin's employer. You're still employed. [9:20] Speaker C: Everybody else has been sleeping for the holidays. [9:22] JD: Everybody. We'll ask that later. [9:24] Mark: The guy wearing pajamas. [9:26] Speaker C: Yeah. [9:27] JD: Been on for six days capitalizing on digital marketing. Key to growth for registered investment advisors and independent broker dealers. Let me read for you a couple of things from this. It leverages a. It's Broadridge and it's leveraging their. [9:46] Nevin: Wait a minute. Let's back up for a second. [9:48] JD: Shoot. [9:48] Nevin: Would you reread that headline as you just did? [9:52] JD: Sure. Key growth for two Marketing digital capitalizing independent broker dealers on registered investment advisors. [10:02] Nevin: Okay, we're good. [10:03] JD: Okay, good. Mark's confused. It comes from. It comes from the Broadway catch up. [10:14] Speaker E: Mark. [10:14] JD: Fourth annual financial advice. [10:16] Mark: I don't understand what's happening. [10:18] Speaker C: Trying to get them back roast in there. [10:19] JD: Oh, it reveals. [10:21] Mark: Evan, you gotta try harder than that. [10:23] JD: Apparently 63% of advisors are actively seeking new clients. Okay, whatever, fine. But inbound prospect requests apparently are not meeting their demands as only 43% the survey are experiencing increases in inbound prospect requests. And that's down from 2021, slightly more than half, 52% of the respondents. So they're either are very or somewhat confident that they can bring on new business. And that's also down from 2021. So they say it's been a challenging year is the takeaway here and the reason for these challenges, our compliance and regulatory guidelines. So there's been a lot of changes amongst broker dealers. Things you have to do, eyes you have to dot T's you have to cross. I've seen that firsthand. Increased market volatility. The markets have been crazy and, and we've had a down market for the first time in a long time. And then they're also facing the same problems that a lot of employers are facing in this kind of hiring crunch. It's tough to find talent, find new people. Question I want to throw out to you and I'll send it to Chad first. I thought volatile markets were a great time for advisors to win new business. Whether or not you're a 401k advisor or a financial planner or a wealth management, I thought when the markets were up and down and mostly down, that was the time when people actually wanted to listen to you and you could tell them your story. [11:57] Speaker C: I would say that's what we've seen in the past. What I have seen different in this volatility than I have in the past though, jd is that people are really wanting to work with folks they already know and trust. And I think that that's led to some of this marketing and advertising falling on deaf ears. People are willing to move advisors, they're willing to change their service teams, but they're wanting to work with people they already know. A lot of the cold calling that we've been monitoring and following for the gentleman that's been doing that, a lot of the outreach has been, in my point of view, unsuccessful. What was interesting to me in that article in terms of success with it is I think they said somewhere north of 40% is the range. People are converting social media leads. [12:40] JD: Yeah. Jumped all the way to the end, but yeah. [12:42] Speaker C: Well, let me make one more point for you, Transition. What I think they missed in this though, JD in terms of the headwinds, is that so many folks who focus in that space are still struggling to figure out how we should be communicating to our Audience in the new world that we're living in, in this digital space where people are not in their office every day, people are, are, are accessing their information differently than they ever had. And I think it's leaving many advisors fearful. Not only is compliance there, not only are times different, but I think it's leaving advisors fearful of spending that money when they don't know. They haven't seen a proven track record of how it's going to work. [13:22] JD: Seems like a reality to me. I, I, when you were saying that advisors were struggling because clients were more hiring people that they knew, my first instinct was, yeah, so it's harder to get to know people on the Internet. Right. Versus the old school way. So I could, I could get you to know me in the old way, you know, through certain things. But now I'm in this kind of dark web trying to get you to trust me. And maybe there's some challenges there now that I continue to be shocked by these guys that are sitting here with us. I've been waiting for them to tell me when life was coming back to normal. And we're not going to have one of these Covid talks like everyone's been having for two years, but they have quickly. And everyone listening in, they quickly tell me that life has changed. They are hitting new sales goals, bringing in more plans than they've ever brought in before, and they're doing it all through their little fucking screenshots. They're literally doing it all virtually. And that continues to shock me. So do you think Chad's onto something here? Nevin, is, is it just harder for advisors to win new business in this new digital world? [14:35] Nevin: Well, I think it depends on who you're talking to and I think it depends on their client base. I mean, and honestly, some of it's generational. [14:41] JD: You know, your tradition, your boomers, you old people. [14:46] Nevin: Yes. Prefer to deal with people. And even there are surveys that show that people are ultimately, when it gets down to trust, they want to deal with a real life person. I, I think younger generations are more comfortable being purely transactional online. But I do think it depends on, on who the advisor is and I do think it depends on whether people know them from before or not. This is not a good environment to get to know somebody in. I don't think if it is a good environment if you, if you know somebody to be leaning on, that's a bummer. [15:19] JD: Because if I was true, if I was starting out, I'd love to hear this. If I was starting out as an Advisor right now to me, I would feel like, wow, like I have so much opportunity I don't have to sell in my backyard anymore. I can sell to all 50 states. So that just gives me a much bigger net to play with as is. And I can be so much more efficient sitting in front of my computer scheduling zoom meetings face to face chats with prospects of mine versus getting in my car and driving everywhere around, wherever I live. I would just think like, oh wow, this is the time where I'm going to be ten times more productive than an advisor from five years ago because of this world I'm living in. But according to Broadridge, that's not happening. [16:04] Nevin: Well, okay, now, not to put too fine a point on it, but, but the piece seemed to mainly be focusing on the fact that people who have a plan actually are doing a lot better than people who don't have a plan, which is the dumb. [16:16] Speaker C: Always true. [16:17] JD: Yeah, I wrote duh right here [16:21] Nevin: and, and unfortunately that's probably an acronym for something, but for now, yeah, you nailed it. [16:27] JD: It said some of the effect of like the survey. The survey found significant differences in outcomes between those advisors who have a defined marketing strategy versus those who don't. [16:40] Nevin: And I wonder, I wonder who would be standing by waiting to help advisors craft a marketing plan anyway. So that, but that notwithstanding, I do think, look, Covid has been a rough period in a lot of ways and I think for a lot of employers and plans and things like that, it's everything's been kind of on hold. Right. I think there's a lot of pent up demand which I suspect is, is some of the, what you can attribute some of the movement to. Now I realize that all parts of the country haven't been shut down the same way that other parts have. And I realized that, that the online, the virtual only sales interaction environment that has loosened a lot of things up and that has made a lot of things possible that were not possible before. The compliance has suddenly come into the 21st century on such things. And that's all a good thing. So there are a lot of dynamics going on right now. But again, I think, I think a lot depends on the advisor and who they are and how they do business. I don't know how to equate somebody who says they're getting this great impact from digital outreach versus anything else. I mean, maybe if they get a contact from something they put up on social media. But the article also talks about the challenges that people have with actually coming up with content to put out on Social media, I think you have to, [18:00] JD: you have to put those in two silos. Like there is the concept of branding and marketing and trying to set your lures out there to, to get new prospects. But there's also the concept of just running your regular business model and doing it in a digital framework and that means bringing on new clients too. And that's where I get weirded out because everyone I've Talked to through 2020 and 2021 and 2022 and like I mentioned these guys, their numbers just keep going up, up and up, you know, like people were crushing it in those Covid years. So I'd love to know that there's more pent up demand, Evan, but I feel like people have been doing really well over the last few years. [18:38] Speaker C: Agreed. [18:39] Nevin: Well, okay, you guys have had the, the California, the Cal Savers program. [18:44] JD: Touche. [18:44] Nevin: Sort of prompting, prompting awareness. And then the next door you've had Oregon Saves out there doing the same kind of thing. So I mean, again, I think there, there are different dynamics now and it could just be that the guys sitting here are just damn good at their job. So you know, [19:03] Speaker C: I can't pass the point earlier where I said that's just wrong, Nevin, because I think that the fact of the how good these two guys are and where I think many have missed so far, this mark is too many people don't understand how to build a relationship via a screen. They get in, they still you. I can't even tell you how many times I get into a meeting with an advisor and it's like they're presenting to a room of 700 people. Well, thank you so much for all of us gathering here today. Let's spend some time chatting about your 401k. I'm like, no, you wouldn't start a meeting when you walked into their conference room like that. So why break the ice? Be personable, have conversations, reach out to people via email. That would nothing to do with the, the retirement plan opportunity. Reach out, ask them how was the knitting class you mentioned you were going to afterwards? Like, you have to find a better way to build relationships. And if people say they can't do that or they haven't figured it out, you're way too far behind now, Chad. [20:00] JD: Sherry Fitz is at home right now watching and she's screaming at like, she loves you. She's like, yes, Chad, you get it. And Sherry, it's so nice to see you. You're off of your six day suspension for not having alcohol at last week's show. So congratulations, you're free to be here. We love you. Can I go to the mark, to the marketing part of this thing? I, I bitched advisors quite a bit about not being good entrepreneurs, not kind of running their businesses properly. Check this out. It, it talked about their marketing spend and it said overall, while advisors average marketing spend continues to increase. They spent on average $17,433 in 2022. It's up from 16,000 in 2021. But here's the thing, that comes down to a percentage of their revenue, which is 3.1%. I won't tell you what we spend, but it's a lot more than that. And most business to client companies, business models spend upwards of like 10% of their revenue on marketing. So I saw this as a clear indication of, oh yeah, these advisors don't understand that they need to spend money on their marketing to win new business. And it reminds me to my old man, who I know many of you know I bought the company from, but he taught me everything I know and he taught Chad too, quite a bit in the beginning of Chad's career. And he was, you know, handing the keys to me, the Nepo baby. I'll drink for that. And it's gotta be one. And he, he had one kind of golden rule for me which was, don't ever take your foot off the marketing gas pedal. He goes, if I've learned anything over the decades and he found the company in 1975, he goes, you always have to be filling your pipeline. You always have to be marketing. And he goes, and that's the biggest mistake that people make in business. You know, they're not trying to keep hustling in terms of getting new business in. So I say to the advisors that are spending 3% of their reven on marketing, you need to dedicate more money and more time to this for it to work. Like you're not taking it seriously. Silence. [22:29] Mark: I'm just, I, I would like to [22:31] Nevin: quote you on her next pitch. [22:34] Mark: I, I want Paul Carlson to come on and verify the accuracy of that quote because after having worked with him behind the scenes on the plan, design, consultants, accounting and bookkeeping and all that for a while. I don't think that's what he was saying at that point. Just going to be honest with you, he wasn't saying, tell JD to stop using the credit card, for God's sake. [22:55] JD: I definitely think there's some differences in how dad did it and how I do it, but. [22:59] Mark: Oh, you think, you think just a [23:01] JD: little bit the moral of the story was, which I think everyone can agree, but I think I'm being serious. I think advisors sometimes forget you are running a business. You know, whether you're part of a big broker dealer or you're part of a bigger registered investment advisor, or whether you're just a solo guy or girl hanging your shingle out on Main street like you are running a business. And there's more to running a financial advisor business than doing asset allocation and fiduciary reviews for your clients. And in watching the markets and doing all these things, you have to actually be an entrepreneur that runs your business. And I think a lot of y' all buck that up and don't realize the time, energy, effort, and money that has to go into that. How much of your week are you carving out to put on your business runner hat and figure out your strategy to the point of this 60 minutes [23:53] Mark: a week sitting here. [23:56] JD: So I do think a lot of people need to look in the mirror for that. I mean, to the point of this article. How many of them don't have a plan? I'm not even going to talk to you people that you don't have a plan, but the people that do, like, is it the right plan? Are you spending enough money on it? Is it strategically intelligent? You know, how are you going about this? Because I got news for you. That's a big part of. [24:16] Mark: Part of your budget should be spent on a robe and then paying me to wear it. [24:20] JD: Yeah. So we should be tamping this. [24:23] Mark: That's a very small percentage. [24:25] JD: The only part where some would get me, Marcus and Brandon's guilty of this too, is but you can't spend 25% of your revenue on a silly show where people drink beer. Like, you can't buy new cameras for 20 grand. [24:38] Mark: Or one could argue that is that. That's edgy and different. You know, you can't. You really can't put a. Put a price tag on something like this. [24:48] JD: My wife looks at the numbers all the time and, and says, you know, how did I spend that much money? Why are we spending this much on the retireholic stuff? And I just change the subject and we move on. [25:00] Speaker C: It's just bar bills. That's all it is. [25:03] JD: Okay, you know what we got to do? You know what we got to do? We gotta spin the wheel of ice. So let's spin it, man. Let's get it over with. [25:18] Speaker C: I'm saying, Justin, tonight, [25:26] JD: It's two weeks in a row. Oh, my Lord. I got it, got it, got It. [25:29] Speaker C: You're a lucky man, jd. [25:30] Speaker E: Oh shit. Speaking of Malor, JD we lost the bet. [25:34] JD: Wait a second. Has Biden signed it yet? [25:38] Nevin: I don't believe yet. The rumor is that they were flying it down to St. Croix. [25:44] JD: Oh, well, we'll see. [25:45] Nevin: I you not. [25:46] JD: Does. Does Biden have to sign it before the ball drops? No. Right? He doesn't care. He could sign it on. [25:54] Nevin: I think he needs to sign it before the end of the 30th. [25:58] JD: Okay. [25:59] Nevin: He will sleep in. [26:01] Speaker E: Joe. [26:02] JD: We're screwed. And we will do that on next week on Saturdays. We'll do that on next. Next week's show. And I've. I'll announce at the end of the show we got a big time guest next week. So it'll be fun for you and I. [26:14] Speaker E: Bigger than Nevin. [26:15] JD: Take our penalty. Yeah. Wow. The good kickoff for the year. It's a good kickoff for the year. I'm gonna drink my malort. But what I would like to do now is do a little setting every cat up For For Retirement 2.0 review of last week. Because Nevin, I was telling you earlier we attempted to. [26:38] Mark: I'm just gonna sit this one out [26:39] JD: and explain to everyone all the cool new in the new legislation. And I think partway through it I realized. And the audience realized we don't know what the fuck we're talking about. A lot of this shit and so not true. I thought maybe we could do a little bit of. [26:56] Mark: Shut up, Chad. It's okay to admit it. [26:58] JD: Of a fact check on what we said last week. So I went back to that section of the show. I watched it through and I. I pulled out some of the questions the audience had. Some of the things we kind of went huh? And it didn't know about. And we've got Nevin here, right. By the way, nobody's an expert on this. But as I pound this Malort Nevin, we talked about the starter K and I know Brian Graff was a big proponent of this, a big fan of this. And for everyone out there listening, this is. It's kind of individual retirement account, like 6,000 limits, etc. Etc. But we had some questions or Chad did. He said, will they have to file a 5,500? Someone in the chat bar said, is there fiduciary responsibility with this? Justin said, are the owners limited by this? Chad asked if there was testing. Justin asked if there was Roth only. I said to them, very flippantly and inebriated. I said, no, I don't think any of those Things apply because that's not why they made this. They made it to be really easy. What can you tell me about the starter K, Nevin and some of those types of questions and cheers to everyone [28:09] Speaker C: on the by the way, before you do, Nevin, Tom just wrote and I validated that Biden did just sign it 54 minutes ago. They announced it. [28:19] JD: Bam. Okay, you, you heard it here. [28:21] Speaker E: Brandon, I need Malord. [28:24] JD: This is not. Oh, we need. We can send you some. I got you Justin. [28:27] Mark: Well why is it just my lord, like that's not a good punishment for being wrong. [28:34] Speaker C: Better. [28:34] JD: And a beer chaser. But Nevin, while I drink. [28:37] Speaker C: Evan, go. [28:37] JD: Can you let everyone know like the starter K, you don't have to file 5000 500s. You don't not going to limit the highly comped. Right. This is simple, simple, simple. [28:47] Nevin: It is, it is simple, simple, simple. It is deliberately designed to basically compete head on if you will with the state run IRA designs. So that's, that's the kind of thing to kind of give you kind of a federal version of that. But it is exceedingly [29:05] JD: individual retirement account, individual penalty. So the state run plans, they're all very different but most of them through their individual retirement account kind of protection claim that there's no real fiduciary responsibility. This is a 401k plan. [29:26] Nevin: Right, right, right. It's a type of cape. Yes. So it is, I think you're going to have fiduciary, all that kind of good stuff. But it's just, it's a lot simpler, it's a lot easier to run. You don't have to worry about the, the, all the testing and stuff like that. So it's, it's really straightforward and there's no, you know, as I said we, we ran out some numbers that suggest that it could give as many as 19, 20 million workers access to a plan. Now that don't have access to a plan because it's going to be real easy to run, real easy to sell. [29:57] JD: But it's not mandatory. [29:59] Nevin: No, it's not mandatory. [30:01] Speaker C: Could we see in the future this be what replaces the state mandated plans? Could we see those fall back? Because there was fear of having 2540 state mandate requirements that are all different. [30:15] Nevin: Well remember that the reason the state started doing it was because the feds wouldn't, because the feds couldn't get that off the ground kind of thing. And you know, it's always been the mandate that chases off. Well certainly on the Republican side of the House, people are disinclined to impose a mandate, particularly on small businesses. And so the states basically said, well the federal government's not going to be able to do this. Then we're going to step forward with our solution to the program or to the problem. So they did. So yeah, now you've got something that might very well compete favorably with those state run designs. Now. I don't know the ones that are there probably be allowed to stay there, but it might very well sort of encourage people who looking at them to say I don't need to. [31:02] JD: Can we have some fun and kind of guess on the sales side of these things. Do we imagine advisors playing a role in. And do I call it Starter K? Is that what I call it? [31:15] Nevin: Yeah. [31:17] JD: Do we imagine a financial advisor playing a role in a Starter K and, and selling something from Voya or, or Trans Am or Principal or Empower and, and picking a core menu and, and that kind of jazz? [31:31] Nevin: Yeah, why wouldn't I? [31:33] JD: That's fucking cool. I feel like, like that's. [31:36] Nevin: It is cool. [31:37] Speaker C: I don't. [31:38] Nevin: It's really. I mean that's one of the big, one of the big things that we, we were pushing for because you know, we've been concerned for a long time about the coverage gap and that, you know there are a lot of different ways to sort of help the coverage gap. The starter K is one of them. The tax credits, they greatly expanded tax credits for new plans is a big deal which we haven't talked about yet. We should but, but that's also a big deal to help close kind of that coverage gap. [32:02] JD: Would it be, would it be illegal for third party administrators to pretend like there's a job for us to do in those and charge. I'm kidding. I'm joking. I'm joking. But it's not great for third party administrators because none for us to do. But that's fine. [32:16] Speaker C: I'm just curious. We've seen the record keeper community struggle when certain changes are made to the space and requirements are implemented. I'm you. You think I won't name 1. But JD just. You think they're really going to want to build out the different limits. The removal of certain things like Roth, the removal of loan provisions. Like they're going to have to completely customize their tech in order to make this operate efficiently and train their people to be able to identify is it a Starter K or a traditional. And that's what. [32:47] Nevin: But y', all, y' all are looking. I don't think it's an either or I mean, I think the opportunity here, agree, is, agree to go in and say, look, because remember what, what small business owners have, have typically held out is their reasons for not offering a plan. They're worried about cost, they're worried about complexity, that kind of stuff. So what you can do is you can go in and basically say, look, we've talked about this before. I know this has been a concern. Look, now there's a solution, thanks to this brand new, you know, legislation that's been passed. Let me tell you something about it. And then once you got that door open, then there's an opportunity because there are things a small business owner, there's not going to be as much for them, if you will, in terms of a starter K. And then the door is open for the discussion. And then you can say, well, you know, we got something that can do even better for you. And that's like, you know, I know [33:34] Speaker C: now's not the time, but I really want to break down the difference from a business owner perspective because that was your comment right there. Like, you're still processing payroll. You auto enroll everybody. You've got. You've got a lot of requirements where people make most of their mistakes. The difference when needing a tax filing and needing to do compliance work, I think is very minimal. If you're talking about a plan where eight highly compensated employees aren't able to save more than. [33:59] JD: Yeah, Chad, but there are also, there also are plenty of companies where everyone socking away 6k is fine, and that's going to be a great start for them. [34:09] Speaker C: I get it. And I'm not denying that, Judy. I'm just saying I don't think there's much of a difference. [34:13] Nevin: But, Chad, I'm going to say this. What you're talking about is the reality, and what I'm talking about is perception. And the two are not always aligned. Sometimes what people, what people think is a reality isn't actually the reality. [34:27] JD: Oh, perception is. [34:28] Nevin: Sometimes you need to open that door. And, and once you, you sort of knock down those objections, not by dismissing them because people don't usually like that, but by saying, I've got an alternative that specifically addresses. [34:44] Speaker C: Hold on. I completely agree, Nevin, and 100% on board with you. And I'm not dismissing this. I'm saying as a professional in this space, it's my job to understand the differences and make sure that I'm advising the people who are reaching out to me for guidance on what I believe is right for them. [34:59] JD: And you might, you might not be A pessimist. But you might lose business because of this. Someone who would have been a, you know, a startup Safe harbor match might go this route because it's simpler and cheaper and there's less hassle. Jeff Atchison, who's a very smart man, wrote in the chat bar Starter K tax credit to offset third party administrator plan installation. Am I being naive here? As I see it right now, you will not have a third party administrator on this plan nor will you have a bundled compliance administrator. There is no compliance work to be done. [35:38] Speaker C: Oh there. I mean there is compliance oversight. You got to validate the auto enroll and who opted. [35:43] JD: You can make up some. [35:44] Speaker C: You can make up eligibility. I mean there's going to be things to be done. [35:48] JD: Oh okay. [35:49] Speaker C: You don't have to do testing. [35:51] JD: That's really fun. Are we going to, Are we going to make up some like administrative support services around? [35:57] Speaker C: No, I think you use tech and you use a record keeper to do that. [36:00] Speaker E: I mean is the government think about the state run plans. Are they really monitoring that? Making sure all the employees are getting [36:05] Speaker C: the payroll provider supposed to be in that setting. [36:08] Speaker E: Right. [36:08] Speaker C: But subject to the Employee Retirement Income Security Act. This is going to be. [36:13] JD: Tony, Dan, you're all doomed. No, but I will take the, the classic cliche response which is if we can get all these companies that are part of the coverage gap and we're never going to set up a plan in the first place, this allows them to. Then we can cultivate them for later days and bring them on to something cooler and better. And Chad will still fight to this day letting them know why it'd be better to do a traditional 401k and allow their owner to sock away. So. [36:44] Speaker C: So I just have to fight. JD I can't back down to when you say this allows them to your. Your pooled employer plan comment. What's the difference? They could have always done this. It would allow them to set this up. They would have had some compliance. [36:59] Nevin: But. [36:59] Speaker C: But that's the difference is that we're trying to look at this and say let's oversimplify it and avoid the complaints. [37:04] Nevin: No, you're. Look, I, I hear where you're going, Chad. And you know what? The, the principal part of me which does exist completely agrees with you. Okay? But the reality is we're dealing with people who are not always rational in the same way or do not have the same appreciation for the realities that you're talking about. So they throw up barriers and they may be made up and they may not Be accurate or whatever, but they're the barriers and they shut off the conversation like completely. So to JD's point, now we're in this environment now, right? We're coming out of the so called, you know, great resignation. The labor market's all messed up. People are fighting over whether they're working from home or not. All that kind of crap's going on and employers are looking for things to sort of help them, help differentiate them. Now you'd like to think that an employer in that situation would say I should have a 401k because that would differ now, but they may not because they're, they're worried about all these other things that may or may not be accurate in their situation, but that's what they believe in their hearts and no amount of pitching them over that is going to, going to get them past it. But now you can come in with a shiny new toy that's specifically meant to address those, those concerns and get the door open for that conversation. And then maybe it has to start with something that's maybe it's like the state run plans, right? I mean there are, there are plenty of situations, as JD said, where the state run plan is all they want to do, you know, and it's all they care about and they just want to move on. And yet how many situations. And I've heard you guys talk about this many times, not just you, but lots of advisors. The mandate, the you have to think about this push does open the door. [38:40] Speaker C: Oh God, absolutely. [38:42] JD: The mandate was the key thing there in California that any other state should figure out. [38:46] Speaker E: I would even say like simplify some of the. Eventually. I mean, why do we keep adding layers and different types of plans if [38:52] Speaker C: you're just going to confuse. [38:54] Nevin: Because, because whatever we. [38:56] Speaker E: No, no, I know what that. The point is, but we have state run plans. We have this, we have. [39:00] JD: Ah, you're good. Okay. [39:03] Speaker C: Yeah, yeah. [39:04] Speaker E: Which I'll drink for. [39:04] Nevin: Like there is, there's. Because there's no silver bullet, Justin. There's no. [39:09] Speaker C: It's a shiny new one. That's the thing. [39:11] Speaker E: It's a shiny new thing. We're all pretty freaking intelligent. [39:14] Speaker C: We're trying to open doors. Nevin said it perfectly. There's plenty of options for people. But we're trying to open doors. We're giving them new things to think about so that we don't have such a big gap. Like, yeah, we keep throwing things, something's going to stick. But more doors are going to open, people are going to set up. I think was crucial in accomplishing a lot of that. [39:35] JD: Do you know that someone wrote me a message on LinkedIn and they said, I love the show, but I've noticed, jd, it seems like you're always very negative about everything. And I took that to heart and I was like, I got. The next morning, I meditated after my tea in the morning and the sun was rising and I said, I'm gonna start being more positive on these shows. And now all of a sudden, Chad and Justin are like the biggest pessimists ever on this show. They've like, Phil, Glad to fill in [40:05] Speaker E: from ARC last week. [40:05] JD: So that's what that was. [40:06] Speaker C: You're missing. I think I. Nevin, I'm so on board with everything you've said, but I feel like JD is missing the mark and my pessimism there is it. I don't think any of this is negative. I don't. [40:18] JD: Just saying they could have done a workplace pushed individual retirement account last year. They could have done it the year before that. And this. What makes this thing that much different than that? Is that what you're saying? [40:30] Speaker C: Just saying that. I'm saying this specific thing isn't the solution. It's the door opener. Like Nevin said, this. I don't think this is anything different. I think this is a shiny toy that opens up conversation. [40:43] Nevin: Well, but it's. And it's more. I mean, it certainly is that, as I've just said. But it. But it's more than that because it's also an acknowledgment that for some employers who may be in a state that doesn't have this kind of a mandate to make them do it will nonetheless make it more available to them. So, yes, I think from the industry standpoint, you should look at it as an opportunity. [41:05] JD: Should have fucking mandated it. Should have mandated it. [41:08] Nevin: You know, not everybody's keen on big government. [41:12] JD: It worked here, bro. It worked here. I mean, we're the Of a small country. [41:16] Nevin: I'm just gonna. I'm just gonna say this. California ain't the whole us. Okay. I'll just say it like that. [41:22] Speaker C: There's what. [41:23] Nevin: California is much more big. Used to big. Big government. [41:29] JD: Are you making. Are you talking about governor? No, I'm kidding. Right? We won't go there. [41:36] Nevin: Never mind. [41:37] JD: Okay. Those are facts. Those are facts. But I'm kind of with Chad and why. Why I say you should have mandated is I just feel like, you know, a proactive advisor could have sold. Could have sold an individual retirement account through their workplace last year and everyone could have saved the 6K and they could have really made it nice and set it up, but they didn't. And I just don't think. [41:57] Mark: Okay, but. But again, you guys are being fairly negative there. What. What is. What is something that a lot of people are comfortable with. The terminology 401k, right? [42:12] JD: Yeah, you got it. [42:14] Mark: Far more knowledgeable about it. Understand it. [42:19] Nevin: But it's. What's it called? What's it called? It's the starter K. I got you. Why do you think it's called the starter case? Exactly. You're making my point. I'm saying [42:30] Speaker C: the same point, guys. That is not the solution. It's the terminology. It's the access. [42:35] JD: It's the door opener. I'm picking up what rogue guy spent down. I get it. [42:40] Mark: The world of the individual retirement account offered through an employer. It's just not well received in a lot of ways. People want to know, and maybe it has more to do with portability and things like that and be able to roll their money in and moving things around. Like you get stuck on the outside with some of those other things with the simple, with the rules in terms of rollovers with Roth than the terms of how you can move that in and out and what all it needs to make sense to people. And so you guys are all, yeah, I missed last week's show. I didn't prepare for jack shit for today. But I'm sitting here just going, I see nothing wrong with what's going on. [43:20] JD: You're right. You're backing up Nevin's argument, which is if you could walk in and say, guess what? The government has put in place a new kind of 401k plan just for you. It's simpler. It doesn't have all the overhead. I mean, yeah, I get it. You certainly could sell that thing a lot better. [43:38] Mark: Damn it, you caught me. Chat bar. [43:40] Nevin: You. [43:40] JD: You certainly could sell that more effectively than selling a pooled employer plan because we've seen how difficult that is. Okay, let's move on. One of the things that I was. [43:50] Nevin: You're not going to mention that we snuck some of those into this bill also barely. [43:53] JD: I mean, what, you're giving them to 403B plans or something? What's the big deal? [43:58] Nevin: Yeah, I don't know. Whoopty do. I bet Minister Desenso is excited there. [44:06] JD: We won't go there. I will come out with a full fledged expose sometime in 2023 proving that this thing has. PEPs have fallen flat on their face. Okay? Yes, I'll drink for that. Do you know what I'm drinking? That's my second one. I'm going straight off the bourbon. You? [44:28] Nevin: Yeah, [44:32] JD: like anybody cares. Oh, nope. That's early modification of credit for small employer pension plan. Why do you say pension plan anymore? I hate that term startup cost. We talked about this last week. We seemed a little confused about the 50% going to the 100%. I think the, the requirement of 100 employees dropped to 50 or less. I basically in my further research now and actually went into the actual 4, 000 page thing. I started to read through that section. I hate the way they lay that out. I could barely understand. So then I just went and read, found someone's summary that I could read and understand being honest. And, and so Chad, you were onto something last week. That same rules, nothing's changed in the old rules of the. The credit is, you know, it's used to say 50%. Now it's 100 of your eligible startup costs. And Nevin, you can correct me when I something up here up to the greater of $500. And then it went to that 250 you talked about. You can have a 250 multiplier times the number of non highly compensated employee eligible participants or $5,000. And $5,000 would be 20 employees. Right? 250 times. Did I get that right? [45:55] Speaker C: Yeah, yeah, yeah. [45:56] JD: So 20 employees. So it, it kind of is a hundred percent of $5,000 in each of the first three years. Assuming, you know, you got 20 people, which is, you know, a small little company. This is fucking phenomenal. This is insane. Like Mark, Chad, Justin and any salesperson out there, I said this last week to go walk into startups now and be like, look, we will cover your costs for the next three years. You're covered. There's no. [46:26] Mark: Or just do a starter K and don't worry about it. [46:31] JD: Why do the starter K when you can get the real K for free? [46:35] Nevin: But see that, that it is an amazing, an amazing step forward for the, for the small plan. It is, it is an amazing thing and it really deals with that second big concern, right? Cost and complexity. Well, that's cost. You just take cost right off the table. [46:51] JD: Three years, which. That's all I said. [46:53] Nevin: Well, I mean, you know, for three plus there's a. But yeah, so yeah, for three years. I mean, come on, think about it. By that point in time, things are kind of up and going and try taking a plan away from people after they've had it for three Years. It's not going to be easy. [47:07] JD: And what are we talking about too, in addition to that. So wait, there's more. When you buy, we're going to give you. In addition to that, if I give a match or an employer contribution, I get. And I get. The government's going to chuck a thousand bucks at that person. And it's like 100% in the first year and 75% another year. [47:31] Speaker C: I thought, is it, is it even a match on the defined contribution side? I thought that that was just on the defined benefit side that you get that additional credit for. [47:40] JD: No, it's excluding the defined benefit. [47:43] Speaker C: Yeah, it's excluded. [47:44] JD: Okay. [47:44] Nevin: It's excluding. Damn, jd, you actually did read this thing. [47:48] JD: Yeah, I do. [47:49] Nevin: I'm impressed. [47:50] JD: I'm dumber than I look, so that's pretty smart, man. That's pretty sick, too. Like, I was doing some math on that and I was thinking to myself, like, if you have 30 employees and you pay those employees 75k and you, you do like a 4% safe harbor match, you know, you, you could, you could get $30,000 credit. [48:20] Nevin: Break out your spreadsheets. We may, we may put a little calculator up, even on our website. Break out your spreadsheets and do this out, man. It is, it's gonna, you're gonna sit. I know I've screwed something up. It can't possibly be this good. But, but it really is. And it's. And again, it's. It's an acknowledgment. The people in Congress understand the impediments. They understand that where there's long been a tax credit for setting up a plan, everything, it, it doesn't. It, it's, it's better than a poke in the eye with a sharp stick, but it's never been enough to really make a difference. This, this is an eye opener. This is the jaw dropper. I mean, it's literally, you can come in to these employers and say, hey, how would you like to have a 401k plan for free for three years? [49:06] JD: You know, Jeff Atchison, are you saying that that's low pay in Cali or high? I don't even. I'm so California. I don't even understand your comments. [49:19] Speaker C: Definitely not happening in the, the rest of the country. Because I was thinking most, I should [49:23] JD: say, I was looking at as kind of like a conservative number. Like, you know, it's, it's. You're not paying people too much, but maybe that's crazy talk. [49:31] Nevin: Okay, let me. Shannon, I think the Reason is money. Because the government, people who figure out how much these things cost think that that costs way more than it actually should. [49:42] JD: It's Shannon and her love child rule. I'm so the love child roller. Shannon. Okay, wait, I had a, I had a thought here. [49:50] Nevin: But what's important is that there is a love child rule that we're taking care of. [49:54] JD: This is the first time that I've seen a real clear, easy to understand like rogue guys should love this motivation for an employer to put in an employer contribution like a match. Now let's be be clear. I can't benefit from this as an existing 401k plan that has a safe harbor. So when I made that analogy of me saving 30k, that's not going to be applicable to me. But here we go again with the coverage gap. But here's another juicy enticing thing to talk to an owner about about setting up a new plan and actually getting this. This thousand bucks per eligible. Yeah, yeah, I know, I know I'm being a weirdo about this, but it's so cool. [50:40] Speaker C: Do you know if, if someone set up say this past year and they're already in one type of tax, do they then get a leverage the hundred percent credit for the next two years, for example, or do they have to stick with what they originally started with? [50:58] JD: I don't understand your question. [51:00] Speaker C: So someone set up a plan in 2022 and they're at a 50% credit in 2023. Can they enhance to the 100% credit of their build expenses? [51:08] JD: Yeah, that. These are the things. [51:10] Speaker E: These are the things because the tax form, everything's reported on the tax form [51:15] Speaker C: form and it's first formal three years of existence. But it's not a new plan, right? They started their new plan under the 50s. [51:22] JD: I was gonna pretend to be Erisa or drink for that attorney. [51:26] Speaker E: Have you looked at the tax on internal revenues services website? So it actually lays out like, hey, this is how you calculate what your credit is. And I'm, I assume that tax form will be updated. [51:40] JD: This is great. This brings up a great point, Chad. I talked to Nevin about this earlier. I want everyone out there to understand this. These 4000 pages comes out. How many pages you think are 401k related, Nevin or 350. 350 pages. Smart people have already gotten together, sat down, read through it all, started having conversations. You all do know that there's going to be all kinds of little nuances, dare I say mistakes, like things that aren't clear and it's going to be up to our industry. And here we have on the show today Nevin Adams like the American Retirement association the people that they partner with to find these little holes see these little gaps in the rules and to figure out how we're actually going to implement this stuff in the real world. And some of those things are haven't really come to the surface yet and maybe Chad's talking about a simple one but all this stuff will start to sort itself out Did I hear his Brian graffiti and some others doing a webinar in January. [52:40] Nevin: All of all of the we'll have webinars for all of the member associations we've been sending out announcement people should go ahead and register for them. They're I mean the ASPA crowd you know the TPA record keepers will have a different look then the advisor community. I think the advisors is 1-26-something like that. [53:03] JD: You'll stay really I'm going to piss off all the advisors listening. So you'll stay really surface level for all the advisors but for the third party administrator when you're going to go deep on this stuff. Right. [53:14] Nevin: Deeper. Yeah More technical. [53:17] JD: Good good. Because to chat but there's going to be all kinds of types of questions [53:21] Nevin: but the team here has been going over all of it and yeah when finding lots of things and as usual what's going to happen is the members are going to ask questions like are being asked here and we'll get those answers. So Chad send me your question in an email and I'll get you a definitive answer. [53:39] JD: I'll answer your question right now. Chad. They already had a plan in place. They don't get any of this new [53:44] Nevin: I wouldn't think so but. [53:45] Speaker C: But they're already in the process of claiming the credit that we're now enhancing so I would think they could I could use credit. [53:53] Nevin: That's generally speaking not the way the government operates but I would think they'd [53:58] JD: be grandfathered on their old Now I'm really making up stuff it's fun to pretend it's fun to pretend to be a an ERISA attorney. I'll drink for that. Okay. We're gonna play a game. It's not a game. What am I talking about? It's not a game. We're gonna talk about your investments. This is serious. We are going to all kneel down to the God that is robe guy. Brandon, please play drunk stock tips little intro dealio while I. Okay. Before market started Quick quick public service announcement. I've never had this before. I just found it in the. In the cupboards. It's a little gnarly. I don't recommend it. And then wishes. I also found this. It's a Modelo Shelada Limon Assault. This is fucking disgusting. [55:11] Speaker C: So they're going that way. [55:15] Nevin: Where did you find. [55:16] Mark: Where did you find that? J.D. [55:18] JD: i'm guessing this is my 24 year old daughter that put this in the refrigerator. It sucks. [55:22] Speaker E: It's really bad, son. [55:24] JD: Really bad. No, he just pounds Coors lights like they're going out of style. Okay, let's see. Trunk stock tips. I got some results for y'. [55:33] Nevin: All. [55:33] JD: You know, we gotta. We gotta stay up on how Rogue guy's been doing and. [55:37] Nevin: Yeah, hey, I'm on Retireaholics. This is. This is. This is Fred. [55:42] Speaker E: Is it? [55:43] Speaker C: Right? You should answer that call. Oh, my God. You should answer that call. [55:49] JD: Reese is on the phone, So. [55:55] Nevin: Hey, say hi, Fred. [55:58] JD: Hello, everybody. This is the prolific podcasting partner or something like that. [56:06] Speaker C: That's how you introduce yourself now, you know. [56:10] JD: How nerdy. [56:10] Nevin: Anyway, I don't know if you saw that Biden signed the bill. [56:13] JD: Of course we did. [56:15] Nevin: Oh, yeah, no, we got the announcement already. It broke on the retire hauling, so. Yeah, but thanks, bud. [56:21] Speaker C: Oh, my God. [56:22] Mark: That was yesterday, buddy. [56:25] Nevin: Good. [56:25] JD: I can't go on anymore. I'm too nervous right now. All right. Oh, she is. I'm turning three shades redder than I was the first time. [56:36] Nevin: Would you say, Fred, this is a calling show. Yeah, yeah, apparently it is. Do you have a question? Yeah, you. You have several questions as I recall. [56:50] JD: But anyway, Fred, we love you, Fred. Everyone, the chat part says they love you. We say hi back to you. All right. [57:01] Nevin: All right, man. You take care. [57:03] JD: I can't believe I'm gonna say this, but can you hang up on Fred? Okay. [57:06] Nevin: I just did. Sorry. [57:07] JD: Wow. Holy. [57:08] Speaker E: No, remember the segment you see I have with Paul? Better call Paul. [57:13] JD: Yeah, I would love. Are you kidding me? If we give Frederica call in. I do it every week. I don't. I'm not even joking. I'm playing it up like I. My heartbeat just went up by like 30 beats per minute. Okay, Bro, I love that he's so nerdy that he's calling you to let you know that Biden signed the thing. That's hilarious. Like, we were. [57:33] Nevin: No, no. So we did a podcast recording this week, and. And that's important because the. The thing about the. The plans having to have automatic enrollment, that's. That clock starts with the enactment of the. Of the Legislation. So aside from will Biden sign it when, when Biden signs that matters for those plans and having to have automatic enrollment now they. It's going to affect the plans that start up after that, but they don't have to start doing until I think it's 2024. So it's a weird. It's a weird kind of thing. But. But that really matters. And it came up in our discussion on the podcast and so we were sort of very aware of the fact that, that when he signed it matters and there was all kind of jokes about having pre drafted plans sitting there ready to go and all that kind of stuff. So yeah, we just kind of geeked out together, so. [58:22] JD: Well, more importantly, it does mean that Justin and I will have to drink 6 ounces of Malort followed by a beer next week. Okay, Drunk stock tips. We got. We got to keep you up to pace on this stuff. You know, rogue guy's a. An absolute God when it comes to this stuff. And so here we go. Netflix, when he told you to buy it, it's at a 46 gain. It's actually a little north of that Twitter. He already locked in your your gains. Any of you Elon haters out there like Mark nailed Twitter. He told you to buy it. If you bought it, you got a 24 gain and that was forever locked in. When Elon bought the company. It's no longer a publicly traded stock. He told you to buy Home Depot. It's a 19 gain for you. When he told you to do that. He told you to run. No, not run away. He told you to bike away from Peloton and has netted you a 26.4% gain on that. He told you to surf away from layered superfoods and has gotten you right for this people a 61.90% gain on that one. As much as he loves Bird and maybe I have to drink for that. I don't know. The little scooters because he rides them. He told his investors, no, stay away from that scooter. Away from it. And you have gained 32.35%. Now I don't want to be all hunky dory roses and unicorns here in rainbows. He also told you to buy Apple, Tesla and Disney. Apple is down 9% since when he told you. But you know, it's Apple, so we'll see. Tesla's the one where he really got. So Mark went with Tesla. Tesla's been getting crushed. It's down 49. But as I research it, there Are a lot of people out there that are saying Tesla will have the last laugh in this, this kind of stock market rundown. And then Disney, which has basically been flat, it's down 3%. No big deal. Here's the nuts and bolts of it. If, if you invested in the s P standard importers, 500. Check swing. [1:00:48] Speaker C: Check swing. [1:00:50] Nevin: How's it a check swing if you finish saying it. [1:00:57] JD: Thanks, man. God damn that. You would be down. Since we started this in May with Rogue Guy, you would be down seven and a half percent. That's, that's where the market's been down. And you know, it's been crazy times, people with, with Rogue Guy, you're up almost 17% in a crazy year. So. And I would argue the things dragging down that 17 look like things that could pop off at any moment. Apple, Tesla, Disney. Okay with that to prove his credibility. To prove. I thought we had Starbucks on there too. [1:01:39] Speaker E: Yeah. [1:01:39] JD: Oh, well, I didn't look at that one. Sorry. We'll check that one out. So my bad. Thank you. I appreciate that. We'll check that one out. I basically do this from my notepad on my Apple iPad. So it's not a perfect science. I got one for you today. A lot of, a lot of weather issues across the country. A lot of people have been upset. Rope guys wouldn't know. Wouldn't know. [1:02:03] Mark: I live in California. I don't give a shit about the weather. [1:02:06] JD: Yes, Everybody, it was 80 degrees in San Diego on Christmas Day. So haha, flights have been canceled and there's been one airlines that stands out from them all. [1:02:18] Mark: I even believe this is coming. [1:02:20] JD: I didn't believe Chad's was canceled today. Am I wrong? Chad. [1:02:25] Speaker C: Chad, today I was not supposed to be here tonight. [1:02:28] JD: What airline, what airline were you gonna fly? [1:02:30] Speaker C: Southwest. [1:02:31] JD: Okay. Southwest Airlines ticker luv. I don't know if I drank for that. I'm gonna have to kick this one to you, Mark, because I don't fly Southwest. [1:02:44] Speaker E: They don't have a first class. Of course you don't. [1:02:46] JD: No first class. It's just not my jam. But it's been hammered because of recent things. It's been hammered because of COVID All airlines as a genre were hammered. My drunk son from University of Miami put a lot of. Put a lot of money into the airlines when Covid hit and was wait, thinking he was so smart. It's not worked out for him so far. What do we do, Mark? It closed today at 33.38. Southwest Airlines ticker luv. Oh, [1:03:26] Mark: All right. So I gotta go through a little process here. This might be the most difficult one because of recent events. And, yeah, it's definitely a toss up in a lot of ways. But here's what I'm. I'm gonna. No, I'm gonna go with my gut. I'm not gonna overthink this. Checking in and lining up in those stupid A24. Whatever. They are the worst. I fly Southwest a lot because of the cost. [1:03:56] JD: It's. [1:03:56] Mark: It's. It seemed to be great. No, despise of their process. They try to get you with their free bags. [1:04:07] Nevin: And you know what? [1:04:09] Mark: It's just all smoke and mirrors. Southwest is going to crumble and crumble quickly. I'm out on Southwest. [1:04:18] JD: You heard it here first. Wow. Short it, people. I. I'm with you. I love this. And for lack of first class, I mean, come on. [1:04:28] Mark: Okay, first off, just be clear. Not even a consideration in my mind, just so you know. [1:04:35] JD: Okay, everyone, you've heard it here first. Mark knows what he's talking about. We have him in talks to start his own hedge fund. And so we'll get this figured out very quickly. And maybe someday in six years, you'll see him going to prison from the Bahamas just like the crypto guy. I don't know. Who knows? You know? We can only hope and dream. Okay, so sell, sell, sell. You know what they say on Southwest? I will look up Starbucks as we close and maybe do a tiny after show. Go ahead. [1:05:08] Speaker C: Well, since Tony always calls me out of my crypto purchases, I should say I'm even. I bought. I bought a fair amount of Southwest at 33. 35 a share. So I hope that you're wrong. Mark. 33. [1:05:24] JD: Chad, get the out. Now you're even. Get out. [1:05:28] Speaker C: I don't know. I kind of think. I want to sit. I think it's gonna go up, so. [1:05:32] Nevin: No, I love. [1:05:33] Mark: I love that. I love that, because you just got burned by them. Okay. And now you're. You're staying in, and I respect that. You know what? Because you're not taking your. [1:05:44] Speaker E: He's not emotional about it. [1:05:46] Mark: No, you're not taking. You're taking the emotion completely out of it. And I agree with. With that, Chad, but I'm looking at this over the long haul. Yeah, of course. Is it going to climb back up over time? It will, because when it comes out of this, the dust settles on all this bad stuff, and they actually hire people to have flights because that's their job. Then maybe people be like, all right, yeah. Over time, though, they're going to get what they're going to get. [1:06:10] Nevin: What's your time frame? What's your time frame? [1:06:13] JD: We don't talk about time frames. [1:06:18] Speaker E: Whatever helps make them right. [1:06:20] Mark: Whatever you're thinking, double it. [1:06:25] JD: Nice. [1:06:26] Nevin: Okay, you'll have to excuse my friend. He's a little slow. [1:06:36] JD: By the way, I looked up Starbucks. You told us to buy Starbucks on November 17th, and it was at $96, and it closed today just under 199.77. So that would have added to your percentage there, bumped you up over that 17 a little bit. So I will add Starbucks next time. Okay. All right, you know, everybody stick with rogue guy on your investments. And no, there's no disclosures here. There's no disclosures. Sorry, I'm stuck in an old show. Let's see, we're gonna wrap it up. Going to do Chap Our Champion. I'm going to tell you about next week's guest. [1:07:18] Speaker C: Oh, yeah? I want to know. [1:07:20] JD: So we're doing Chap Our Champion the old school way. There's five of us here, and we each make our votes. I'm going to vote for Bill Shorees because he's been active in tonight's chat bar, and he sends me free Titleist Pro V1s from time to time. Okay, Chad, you're next. [1:07:45] Nevin: There's. [1:07:45] Speaker C: There's. There's a lot of good back and forth tonight. [1:07:49] Speaker E: I don't take my Chad. [1:07:51] Speaker C: I think I'm going with Jeff. [1:07:55] JD: Damn it, you son of a. Jeff Hatches? [1:07:58] Nevin: Really? Yeah. [1:07:59] JD: Well, don't say son of a. You vote for him, and now he wins. [1:08:05] Speaker E: Oh, he said okay. [1:08:06] JD: I thought. Yeah, I thought you dumb, dumb. You have to vote for, like. I'm voting Jeff. Okay, two votes for Jeff Nevin. Your vote for chapter champion. [1:08:16] Nevin: Well, I was gonna go with Jeff, but now we got to make it interesting. I'll go with Shores. Because although he does not send me golf balls like. And comment on my post on LinkedIn, [1:08:30] JD: Robi breaks the tie. And Robi, I suggest you ask each of them how many drinks they've had tonight in the Chubber. [1:08:38] Mark: Wait, I don't want to break a tie. I want to have my own. But I vote for Sherry Fitz. [1:08:42] JD: Okay, fine. Sherry Fitz. All right, Brandon. [1:08:46] Mark: Brandon's so mad right now for those two. [1:08:50] JD: I'm the ultimate tie break. [1:08:51] Mark: So, yeah, there you go. [1:08:58] JD: Jeff Atchison, you won Chap Our Champion. Congrats to you. And I just realized that I up last week, so I gotta get your charity and I get. Gotta get Last week's winner. Who won last week? I forgot. We'll figure out. We'll get their charity, we'll pump it on the Internet. We'll give 150 bucks to each. Is it Samson? Was it Samson? I didn't reach out to Samson. [1:09:23] Mark: Sounds right. [1:09:23] JD: We'll get Sampson's charity, we'll get Atchison's charity. We'll give 150 bucks to each, and then we'll put it on LinkedIn. Hopefully you all out there can chip in. I. I told you last week, I think we were about 1700 bucks for the month so far to charities, which, you know, it's not a big deal. [1:09:39] Speaker E: Part of our marketing budget. [1:09:40] JD: That's something. No, that's. That's money. Our marketing. Our budget stayed the same. Instead of spending 150 on pizzas with anchovies, we sent it to, like, you know, charities. But we're getting other people to jump in money, so that's good. That's good. Next week, who's going to be here? He's with American Century. And I never thought American Century would come here because over the years they told me, jd, we love what you're doing, but just not crazy. Just not on brand for us at American Century. [1:10:18] Speaker E: And people said that to us. [1:10:19] JD: They've come around. They've come around. So Mr. Glenn dial. Yeah, of course. [1:10:23] Mark: Nice. [1:10:24] JD: Kind of national speaker will be here on January 5th, and we'll be talking to Mr. Dial about all the things. [1:10:32] Speaker C: Oh, that's gonna be fun. [1:10:34] JD: Yeah, he'll be good. And thank you, Nevin, for joining us today, the finale of 2022, season eight. [1:10:44] Nevin: As Justin would appreciate the invite, as always. [1:10:47] JD: Yeah, we really appreciate that. And like I said, was it really [1:10:51] Mark: an invite or did JD beg you? [1:10:54] JD: Big. I don't remember. I honest. [1:10:57] Nevin: I think he basically knew I would be desperate enough to join. [1:11:01] Mark: Oh, no, we were desperate for you, buddy. [1:11:04] JD: I thought it'd be fun to have someone cool to kind of finish out the year, but you couldn't get them, [1:11:09] Nevin: so you got me. [1:11:11] JD: And, hey, everybody got him. [1:11:13] Speaker E: Because you're worried about attendance. [1:11:14] JD: And hey, everybody, we had a bonus. We have missed Mr. Reese call in himself. That was a cool bonus. Yeah. Thank you to everyone out there that. Yeah, during the holidays. Very cool of you. And, yeah, that's another year. Unless Mark said it's been eight years. I'm not going to get all, like, emotional end of the year thing, but it's cool. We're still doing this. [1:11:38] Speaker C: Awesome. [1:11:39] JD: You're all still participating. We got some great planned for 2023. Stuff that I've alluded to in the past. It's. It's hard at work right now that we're excited for y' all to see. And some great guests lined up, too. Yeah. [1:11:54] Mark: There's very much something that I'm wondering when it's ever going to come out. Didn't we take a long trip? [1:12:00] JD: That takes time, man. [1:12:02] Nevin: Yeah. [1:12:02] Mark: October. It'll be done. [1:12:05] JD: That takes time. [1:12:06] Nevin: Did he say which year? Did he say which? [1:12:08] Speaker C: He did. Right? Fine print. [1:12:13] JD: Well, yeah, [1:12:16] Mark: that's not going to happen. [1:12:20] JD: Brandon's actually tasked with a lot of the work. Okay. So out there. Yeah. 4K industry, we love you. It rocks. Secure act. I'll drink for it. 2.0. [1:12:32] Nevin: Hey, hey. Say it. Say it. [1:12:34] Mark: Everybody. We'll see you next year. [1:12:38] JD: Oh, there you go. Mark ended it. Peace, everyone. I don't know, maybe five minutes. [1:12:46] Nevin: That's what they say, Tom. [1:12:48] JD: Maybe five minutes in the after show. Maybe not. I'm not sure. We'll see. Okay. Brandon plays out some music. Peace out, everyone. Happy New Year, Merry Christmas. You know, all those things. [1:13:00] Nevin: Cool brand. [1:13:02] JD: You do have music.