Tom Gives Himself Investment Advice 20 Years in the Past
Transcript:
Katie Nealis:
So let’s talk pre retirement, we have another question in here asking, what financial advice would you give yourself? If you could give it to yourself when you were, say 20 years younger?
Tom Vaughan:
Wow. Okay, so here, yes, you know, I’ve done, I think about 6000 financial plans altogether over my career, dealing with, you know, hundreds of millions of dollars and a lot of very wealthy clients. And there is one characteristic that they all have all of them. And that is the ability to save. And so it’s kind of funny, because so much effort is placed on you know, how to best you know, what, what to invest in, and, you know, all these different types of things. I would say that of my wealthiest clients, only a few of them are really good investors as a whole. For the most part, what they are is really good savers. And I’ve heard comments, you know, over and over, like, Well, you know, my father told me to just, you know, put aside 10% of and pretend like it’s not there. And so, you know, I always pretend like some portion of the money isn’t there, and I live off the rest, and that money just continues. So if I, you know, 20 years ago, I’d really hammer that home to myself about saving and continuing to consistently put money away, you know, no matter what’s happening, trying to live off of the rest, and save, you know, some portion of the overall income. And so that’s, that’s a big one. Because I’ve met people that are fantastic investors and not great Savers, and they don’t have that much money, just because they don’t have that much money to put into the investments that they’re not saving.
I think the other thing that I would think about there, I think this would have been appropriate, I would try to save as much as I possibly could into Roth IRAs, or Roth 401k Ks, I would like to have tax free growth. I recently converted, you know, all of my IRAs and 401 K’s over to Roth, I wish I would have done that a long time ago, when I was younger, just because it’s really painful to pay the taxes on that conversion. Now, I’m 5657 next week, so almost 57. But so I have a long time to let that still grow tax free, but 20 years ago, so say 37, that would have been an unbelievable time to because I’ve had great rates of return on my IRAs, and I would have loved to see that be tax free. So I would, you know, been talking to myself to save more than I did and to really look at these tax free growth vehicles like the Roth, which I believe came out a roughly 20 years ago, but yeah, that sounds about right.