065 – Cost-effective wealth management – with Andrew

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Millennials are saying the number one source for stress is retirement, above all else. The Millennials are not ignorant of how things are and do not want to be “like their parents”. So, why is retirement a source of stress.

Robo-advising is the next step in the financial world. Traditionally, you could go to a stock broker/financial advisor/bank, and get advice on how to invest. It could go into mutual funds, bonds, stocks, etc. If you didn’t want to go that route, you could do it yourself, and go to a discount broker online. You would pay per trade, and do it yourself. A robo-advisor is a bridge between. They will help, manage your money, and do it efficiently. They are registered in all provinces in Canada. It isn’t for everyone. However, this is an option.

An ETF (Exchange Traded Fund), is like a mutual fund, it is a “basket” of companies. The difference between a mutual fund and an ETF, is with a mutual fund, someone picks the companies for in the basket, with the ETF, all the companies of the market are in the basket. Because no one is selecting the companies, you aren’t paying a portfolio manager, which allows for cost savings.

Clients complete a risk tolerance questionnaire, based on the answers to those questions, recommended portfolios are suggested. However, there will still be a conversation to ensure that is the investment for you. It is a process driven business.

Following Justwealth’s twitter feed features articles daily that is helpful to investors. It is a sharing economy. Competition is good for the client. It can drive up the value and drive down the costs.

Regulations aren’t necessarily a hinderance. There is a balance. The investment world is highly regulated. Those regulations are intended to protect the public’s best interest.

Bitcoin/cryptocurrency it is something that Andrew has looked into and is now aware of. When it comes to investing, will it have an impact – this remains to be seen. This type of currency can go around the world.

The early adopters of robo-advising (the assumption was, it would be millennials) the reality is, the clients are older. At the core, technology is helping provide a service, to make it more efficient.

An interesting new app, blinkist, it has a subscription. It is a time saving app, because they take books and break them down into “blinks”, key points. Then you get the summary of the book. There is a number of books that are available. Also, this leads to you having access to information you may not have normally looked into, due to time. As an entrepreneur, time can be a challenge. You don’t want to give up important things and also have knowledge and learn.

Talking about the direction of education, the experiences, and learning from others who have done this before, accounts for a lot. Digital may be efficient, but you cannot discount the value of human interaction. Education will change and evolve, perhaps more hands on. Less the institution, more the person.


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