Over the past few years I’ve had the opportunity to get to know several people who have achieved financial independence or are on the path to it. People like JD Roth, Darrow Kirkpatrick, Karsten Jaske (Big ERN), Fritz Gilbert, Dirk Cotton, Jillian Johnsrud, Jonathan Clements , Doug Nordman, Todd Tresider, Amy Savage and many others.
Blue Bird Day at Squaw with Avalanche
photo credit: Steve Chen
These aren’t people who have made millions by cashing in at a Silicon Valley startup or inheriting wealth, but rather hard working people who share the goal of getting more control over their future relatively early in life, so that they can pursue new passions and goals.
Note I chose the photo above since it represents something I love to do and I like the symbolism for the aspirations we have in life (conquering mountains) along with the risks (avalanches) that are out there no matter what we do. While I’m not fully financially independent — since we’re building Boldin, I do have a degree of schedule control that many people do not. So, I consider myself time independent and will sometimes bomb up to Tahoe.)
Anyway, here are some things I’ve noticed about the financially independent:
- They all save money and share varying degrees of frugality – they are smart and thoughtful about how they invest and spend their money
- They enjoy life and value experiences over things
- They are pretty curious and interested in new ideas
- They are generous with their time, but don’t like to waste it – they don’t put up with BS or jerks
- They are a lot busier than many people who have to work for a living
- They’re transparent – if they have an agenda, they’ll share it with you
- They do what they want – many like to help people or causes they believe in
Imagine if you achieved financial independence either early or around a traditional retirement age:
- How would your priorities change?
- Where would you spend your time differently? (Time is our scarcest resource.)
- How do you think you might change as a person?
How Do These Principles of Financial Independence Apply to Our Vision for Boldin?
Basically we think that if more people were financially independent or on a path to it, then more people would live richer more purpose filled lives.
JD Roth said “I help people think about their purpose as a path to happiness.” Listen to the Boldin podcast with JD Roth or explore ways to find purpose in retirement.
At Boldin, we are trying to help people get financially confident for a secure future, but also to help them unlock their full potential. In our view anyone that has a solid retirement plan that gives them visibility and confidence into lifetime income that meets their expected expenses has achieved financial independence. (Note: There’s a lot wrapped up in a Boldin Plan that helps you think through drawing down your assets efficiently, using Social Security, Medicare, tax efficiency, where you live, health care, etc)
We’ve spent a lot of time learning and talking with experts about how to create a successful retirement and achieve financial independence. We think we have a better way.
WHO We Are and WHY We Do What We Do
A friend of mine shared this Ted talk by Simon Sinek on “How Great Leaders Inspire Action.” Sinek makes the case that people care first about WHO you are and WHY you do something before the WHAT you do or HOW you do it.
So I wanted to share with you who we are, why we are doing this and where we are going.
Who: We are a team of software designers, developers, writers and podcasters who like solving really hard problems. Having helped our parents achieve a secure retirement, we discovered a huge need that we think we can solve. We want to make easy to use retirement planning systems available to everyone.
We know the financial services ecosystem and have deep experience building solutions for firms like Charles Schwab and Dimensional Fund Advisors, but feel like there are many opportunities to improve in areas like costs, transparency and making solutions easier to use.
Why: We think that for many people – there is a much better way to approach retirement. We think there is a path that leads to better results, costs less and involves less risk. We think we can help many more people get confident about retirement by making it easier for them to get organized, educated and make better choices, which in turn will enable them to pursue their passions.
For us – success looks like helping millions of people achieve confidence and financial security through the use of our platform.
Boldin’s Beliefs
Here are our beliefs and first principles:
There is a Big Need for Planning
- A huge number of people need help. There are 120 million people over the age of 45 in this country. Savings rates are low. Financial literacy is terrible. And, 50% are at risk of a lower quality of life in retirement.
- People are concerned about Retirement. It’s the #1 financial worry with 65% of people worried about it. However, most people engage in active avoidance because they believe it’s too complicated or it’s a hopeless cause.
Traditional Advice Structures Aren’t Meeting the Needs of Regular People
- The shift from Pensions to 401K Plans means everyone has to become a financial expert and manage their own future
- Focus is on investments and returns, but the reality is that many people don’t have adequate savings
- Fees and costs are opaque or completely hidden
- Low cost holistic advice is nonexistent
- There’s a lot of misalignment – many “financial advisors” are salespeople – few are fiduciaries
- Market commentators play on the emotions of consumers by touting the fear & greed cycle
- People want to do it themselves, but existing solutions are either overly simplistic (almost all online retirement calculators oversimplify highly complex calculations) or keep the calculations completely opaque and don’t do a good job of educating the consumer along the way.
- There is an over reliance on averages — no one is average.
“Regular” People Face A Lot of Challenges
- Achieving a secure retirement is simple in theory. If you’re younger: just save 15% of your salary from age 25 and invest it in a well diversified portfolio. If you’re approaching retirement: get educated, inventory your assets and use your resources optimally
- Actually executing on this is not easy which is why current retirement outcomes are poor for many people. (70% of households aged 55-64 have < $100,000 saved according a recent GAO study). It’s not easy for several reasons or hurdles in the parlance of William Bernstein
- Hurdle 1: you need to save money (so you can invest)
- Hurdle 2: you need to have basic financial literacy, so you can make good decisions (education)
- Hurdle 3: you need to understand financial history, so you can recognize patterns and avoid the mistakes most retail investors make – largely buying high and selling low vs. taking a long term “get rich slowly” approach (education)
- Hurdle 4: you need to understand your own behavior and get external coaching and advice if that will help you make better decisions and avoid common mistakes like buying at the top and selling at the bottom
- Hurdle 5: you need to understand that there is a lot of misalignment in the financial services space (work with fiduciaries and understand the incentives counterparties have and how they get paid); many people are out to take your money
- If you are not educated or don’t have savings and need money – you will be charged high interest rates or fees – see credit cards, payday loans
- If you have money – you will be presented a litany of complex products that often mask high fees for limited value
There is a Better Way (An Evidence-Based Approach)
The path to success involves tying together best practices, education, transparency, automation and behavioral finance through an easy to use scalable digital first solution.
- People want the option to start themselves – as evidenced by their use of our site – tens of millions of visitors over the years and tens of thousands of Planner users who collectively have tens of Billions of dollars they are managing.
- If we can show people there is hope and make it simple enough we can help millions of people achieve better outcomes.
The building blocks for people to achieve retirement security exist today, but most people don’t fully understand how to put them together in an optimal way
- Personalized Assessment, Planning and Monitoring tools (like those built by Boldin)
- Targeted Education
- Fiduciary, Flat Fee and Collaborative Advice
- Low cost investment vehicles
- Tax efficient investing and draw down strategies
- Human capital (work part time)
- Social Security claiming optimization tools (rule of thumb for a couple – have the higher earner delay until 70)
- Home Equity (about half the networth of a typical household)
- Healthcare & Medicare guidance
What & How (Our Value Proposition)
Boldin makes it easy to get on path to financial confidence through our tools and method which get you organized, educated and help you create your own plan for financial independence.
We help people create their own Living Retirement Plan. No one can predict the future, but we can anticipate what is likely to happen and create a plan that gives us confidence about our future. We want to help people get organized, get educated, understand their options and then monitor and manage their plan in an easy low cost way over time. We want to stand firmly on the side of our users.
We want to support people with different levels of service
- Do it yourself – You can use our Free Retirement Planning Calculator or take advantage of PlannerPlus based on a subscription model
- Do it with me – We can offer low cost, high value fee based collaborative planning advice around your Boldin Plan
- Do it for me – We can provide access to lower cost Boldin approved full service providers if you want to delegate this
Hopefully you’ve seen that we’ve been working hard to make the Free Retirement Planning Calculator better.
Our team has also been hard at work on PlannerPlus and we hope to have an announcement soon for our existing users. This will be rolled out in phases, but we have a vision of how we think we can help millions of users along the lines of what is laid out above. We also are learning a ton from you our users and we hope that together we can solve this problem.
Thanks for reading this – we appreciate your time. We believe that the work we’re doing can help many people get to a more secure future and hopefully contribute towards people achieving their dreams.
Any suggestions or comments on our tools, writing or podcasts are welcome. Email me anytime!
Note: We have created a private FaceBook group for our users who want to share feedback and engage with us directly – you can request an invitation here: https://www.facebook.com/groups/newretirement/
Best, Steve
