About This Conversation
Mark Nagle (Treysta’s Executive Director and Head of Advice) talks to Aleks Vickovich about his journey in journalism, his personal values in terms of finances and business, and the backstory of his significant published book (USA G’DAY) and articles. He also shares his very own “Money Moment” with us – how his approach to finances shifted since the birth of his daughter last year, and more.
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About Our Expert
Aleks is the wealth editor of the Australian Financial Review (AFR), an award-winning journalist and author, where he writes about financial advice, funds management, superannuation and banking, with a special interest in the next generation of investors.
Transcript of Conversation
00:00:18 Mark Nagle
Welcome to Treysta’s podcast series in Conversation with today I’m joined by Aleks Vickovich, author and current wealth editor at the Australian Financial Review, Aleks.
Good morning and thank you for joining us today, so I think what I might like to kick off with to help our audience is for you to go through your life journey and the destination that was or is journalism?
00:00:44 Aleks Vickovich
Thanks Nags, and thanks for having me. As you know, I prefer to ask questions and answer them, so you’ve done well getting me here and I’ll be sure to remind you of that in the years ahead.
So, life journey. Wow, mine hasn’t been as long as perhaps some of your peers and clients. You know, I’m only 34 this year, but everyone’s got a story and mines been reasonably interesting. I suppose that for me, being a child of on my father side of a migrant family. I’ll probably go back further than my own story.
The story starts in Paddington, but it doesn’t right, no. So, I think that you know if you go back to the old country then my father’s family came from the former Yugoslavia, which is a conversation for good podcast, but probably not this one right now and then. My mum family are Irish Australian, so yes, my story starts with the invasion of Poland. If you want to think about it that way but via this journey, I guess both of my parents ended up in Sydney in the mid 80s and then my life began and, but I had, I guess, a reasonably privileged background as most people in my profession have frankly it’s really, they say, is a downside and a drawback of the media industry. Perhaps it’s one of the things that sometimes makes the media you know slightly out touch from regular folks. Not that I was born on an island mate, but I’m saying you need a certain level of English skills I suppose to write for a living.
So, my parents were lawyers and run a small business together or practice out in the western suburbs and they went through a divorce and threw it through a business separation. So, you know, I’ve seen hard times as well, which prepared me well to become a business reporter, but they invested a lot in my education.
I was a fairly talkative kid at school, often in trouble, but like.
00:02:36 Mark
I don’t find that odd strangely.
00:02:39 Aleks
Yeah, that’s right, but I was able to channel it into to being a champion debater which meant I got away with it, it was just meant you could talk up the back of the class, but with some sort of award at the end of the year. But so yeah, after that I went to Sydney Uni. At that time knew basically that I wanted to write for a living, was interested mainly in, sort of, politics. Business wasn’t really on my radar back then as it’s not for a lot of kids, I didn’t grow up with much financial literacy at all.
It was a typical migrant household in some ways, and a lot of people who’ve come from nothing and you know, particularly refugee backgrounds and then end up being lawyers or businesspeople. They might resonate with this, you know, when I ask for money as a kid, it was sort of given to me, whereas a lot of people that I know that were much wealthier had much better financial regimes and far more chores that they had to do to try and earn that. That then certainly I have.
I think that I never had business in my mind because frankly, you know I had that misperception that business is about numbers and it was many, many years later that I learned that business is about people at once.
I was already, you know, paid to talk and write about business, but studied politics and philosophy at Sydney Uni and then journalism, I was broadly interested in, but I had kind of lofty ideas of kind of academia or sort of.
I wanted to write substantial stuff. You know, I didn’t want to write about cats up trees was the way that I thought about it at the time. And then I had a contact at the ABC and he said, you know, well, if you’re thinking about journalism, the way to do it. And I still think this is this is great advice. You need to have.
And this is a very old school Australian mentality. Not all editors these days would agree with this.
In the old days you had to have regional or rural experience. That was where your your stripes and and that’s basically what I did.
00:04:32 Aleks
I approached a whole bunch of ABC local radio editors around the country and then ended up getting invited to go down to Wollongong and I was there in an interesting time when the Council was being sacked and there was a whole lot of corruption. But I didn’t spend all my time doing that. I was doing a lot of cats up trees and bushfires and court reporting and everyday stuff.
And frankly, I fell in love with it, which was really cool and I didn’t expect and I thought, you know, if I was to stay in Wollongong and do this for the rest of my life, it it wouldn’t be so bad.
And I kind of liked that element, so I dropped out of my thesis, which I was doing, which was all about.
I was applying some sort of Plato text to the Iraq war, which was interesting at the time, the editors down in Wollongong thought that was the biggest bunch of ******** they’d ever heard and almost didn’t take me on because of it and he said maybe if you want to be a journalist, study journalism.
That’s probably good advice. And then from there I spent most of my 20s overseas, Mark, which you may recall, I bumped into a few times towards the end of that at times.
But and that was really what drew me to this profession.
You know I went to, I don’t know, 50 something countries, I used to count them, I don’t anymore in the last two years it’s I guess everyone’s focus has changed, right? We’re happy just to get up the coast and don’t go around counting countries like ticking off places anymore.
00:05:49 Mark
No, no, a young Aleks would have had a different experience over the last couple of years, that’s for sure, isn’t it?
And you gotta kind of feel for you know the 20 somethings that are probably missing out on some of those experiences. Alex. Most of the time that you and I have known each other, you’ve been in financial journalism and throughout that time you’ve always been one to take up a cause, and you’ve been very passionate about that. And it’s kind of been from very different directions. You know, sometimes in the defense of the advice industry, sometimes in opposition to it. Sometimes you know on the side of regulation you know, other times being quite vocal against some of those regulations.
Where did all that come from? Where did you kind of start to see areas that you had strong belief in and start to write quite powerfully about it?
00:06:37 Aleks
Yeah, that’s an interesting one. I just sort of fell into financial journalism. I got my first proper paid job as a journo in London working for a legal trade publication, which was just a really good training because I went from just being a complete amateur going through Africa with the backpack thinking I was undressed. Thompson to, you know, having a proper job interviewing top lawyers in my early 20s and that was a great training in that I was writing straight away for an audience that you don’t screw with, right?
You know, I didn’t really try and fake it. I was. I was more so just like tell me what you know and then that will help me ask better questions next time type thing and so that was a great training and I you know, I was nervous at first. Like some of these guys were, some of the top arbitrators and litigation lawyers in the in the world in this London publication.
You know, just arbitrating disputes between Hugo Chavez and Chevron was one of the first cases that I was writing about. And, you know, I thought these guys are going to be big dogs, you know, and some of them have been arrogant, of course, but most of them were pretty generous with their time and seemed to be just Dads who were kind of passionate about their work and had important and well-paid work.
It started to change my perception. You know. I was probably pretty anti-business at that time come through. Even going to a private school you know you still grow up with these sorts of pro-government anti-business kind of frames of reference that are kind of naturally ingrained I think in the school system and in Hollywood, and then of course at University I read a lot of Marx and as you do at Uni, and you know I sort of had an open minds of stuff. But I sort of had this general view that people who are in business are crooks or selfish, right that that’s the sort of general perception that we’ve gone through life.
Yeah, that was the premise. I mean, I didn’t. I wasn’t really saying it was taught to me at home.
I wouldn’t say at all, but we didn’t really glorify businesspeople growing up either. I mean, it was more of an academic household that was pretty objective about all that.
I would say it making money and being in business, but it was when I actually met businesspeople that I started to like them. Frankly, that’s the first thing that happened, I came back to Australia, and I was sort of at a crossroads. I thought about maybe you know, trying to do the ABC and get back into that route that I was on originally and going to a rural area and you know, do telly.
00:08:50 Aleks
Frankly, the trade press is one of the areas of the media, particularly 5-6, ten years ago, when I was sort of getting into it that was flourishing and the rest wasn’t right. The mainstream newspapers were in crisis, we’re doing a lot better now, but there was money because it was a structure where there was an obvious advertiser, a highly lucrative reader, and lots of entrepreneurs and sort of realized that there was a business model to be had here.
And it was particularly business model that hired younger people, which was very different to the existing newspaper model, which was to gut all the workers and keep all the big-name sort of columnists that keep people reading, so it was good for me to sort of do that. I joined the right business that I was in for five years, and I joined them when they had 25 people. I think they’ve now got over 200.
I left them a few years ago, which was tough, but you know, they were just growing rapidly every year so they also had a real affinity with their readership which were business owners across financial services, mortgage, property investment and they were just a good honest kind of Aussie business that was going through that really interesting part of life of going from a start up to a substantial business employing 200 mostly young people, right.
And they had just acquired a financial planning magazine from Morningstar, IFA Magazine and Investor Daily which were well established. But it’s sort of floundered a little bit. You know they were bought by a research house, and they were very kind of big end of town in their focus and they sort of lacked a bit of a heartbeat. To be honest, with no offence to anyone listening who might have been working for those public places, but you know it was very different to this businesses approach, Momentum Media, who were much more pro small business in their phone because I guess like just you know they had a much more common touch, regular Aussie vernacular. They had really made their money by backing the non-bank lending sector and the non-bank brokerage sectors that are, you know supporting guys like Mark, Boris and John Simon in taking on the banks and they had a real editorial and commercial kind of success with pursuing that editorial line and it made them very close to mortgage brokers.
And when I started that was the kind of litmus test you know. They, the owners, were personally friends with most of the mortgage brokers in the country and knew them and knew their stories and had become successful.
00:11:06 Aleks
So, I can’t take that much credit Mark frankly, except that they saw in me someone who maybe had the skills to do that in a new genre and what they did which was almost never done in the financial media at that time. They said don’t go to any press conferences for the first six months, don’t speak to any of these lobbyists or associations or any of these people who are paid to talk to you.
Pick up the Yellow Pages and start calling financial planners and that was their approach and that’s what I did I remember I went out to Penrith and I spoke to a planner and I still keep in touch with that bloke now and that’s how I sort of went through the industry with a sort of ground up.
It wasn’t my intention to then have influence necessarily. Our intention was just to run a publication that was slightly different and had a bit of a you know that commercially had a different story, so that we could take that to market frankly. But what we found quite quickly was that there was this gap that a lot of small businesspeople did feel neglected in this market.
They didn’t feel like the fund managers and the lobbyists and the politicians were talking to them and certainly not the media.
And then this 20 something journo turns up and says tell me how you started your practice in Penrith. Frankly, they liked being asked that.
00:12:21 Mark
You have been part of the advice journey at our business at Treysta. You know we love that blank canvas Alex that we invited to join us on one of the study tours across the US and I was trying to think Alex went when the first one was, but it’s probably getting on for eight or nine years ago I’m guessing.
00:12:39 Aleks
Yeah, yeah. 2012 or 2013.
00:12:42 Mark
And you know that sort of a fresh approach that you had was something that we really liked. We liked your objectivity in the room, which was a crucial part of learning. Of course, if you simply wander in and you’re the brightest people in the room, you’re not really going to come out with March and your ability to kind of transcribe some of what was going on and have that playback moment that we had most most evenings on those tools was really useful to get your perspective. When you sort of look back across that period to where we see ourselves today.
And of course that’s included a royal Commission, which you know most people will be very familiar with. I mean, how do you see advice? Do you think, has it progressed in the right direction?
Do you feel that a client going into or seeking advice now is likely to get a better experience than I would have done, let’s say 10 years ago?
00:13:34 Aleks
Maybe, but I’m not one of the people who thought that there was a major deficiency to begin with. To be honest, and again, that was something that set me apart and that wasn’t a political decision that I had made, that was because I had gone out and done the grass roots of meeting these people, interviewing them, getting to know them.
And that’s frankly how trust is developed, right? And so, I had a very large number of financial planners who at any one time in most of the cities and even regional areas around the country I would happily recommend to people and so that was a real point of difference from, say, people at the AFR, where I am now, who had only met the ones who perhaps were in private wealth firms in Collins Street, and very, you know, active in speaking to the AFR and the Australian and you know, we’re part of that kind of big end of town world.
But sub urban planners that most people would go to. They had no frame of reference to other than a few that have done the wrong thing, and so there was this sort of widespread perception that there was a lack of trust. Now, that’s not to say, as you know, I’ve written and was really passionate about some of the corruption and the problems in the industry.
But I don’t accept the fact that most of those were occurring at that level of a client going into a practice most of those were situations where the misconduct was because people were torn between their ethical responsibilities to the client, which is something that has really developed and there has been a lot more focus on that, and that’s been a positive thing.
00:15:07 Aleks
But also, they’re perhaps more important at the time. Responsibilities as employees and they were being told to do something by a large organisation and anyone listening to this who has ever been an employee, or has had perhaps not a direct analogy, because we don’t need to get into the boring detail.
But, of course, the licensing relationship is slightly different to being an employee, but you know there were ways structural ways that these large corporations could control what these small businesses around the country were doing. There were sharks, and I believe me I’ll come into contact with them myself and even had death threats from time to time.
So, I know how nefarious the people on the fringes of this industry are, and that’s not surprising, right?
I mean, any industry where you’ve got access to people’s life savings in the same way that you get twisted creates becoming doctors sometimes, and because of that access to vulnerable people.
Right now, the barriers to entry to being a doctor Wahana, which does safeguard people and that’s why it’s probably a good thing that they’ve increased the education standards and so on.
And for me, I always thought that was a bit of a logical misnomer because I don’t agree that it was a lack of education or a lack of ethics that led to misconduct. I think there were deep problems in the way the industry was structured. Frankly, I think misconduct was profitable. And if you look at the capital buffers that the banks have made that they’ve got today a lot of those capital buffers which have helped us get through the GFC and then the coronavirus pandemic were stacked up on the back of this misconduct, right?
00:16:33 Aleks
So, I don’t blame the planners. I blame a flawed licensing structure and a political and a big business class that profited from the way that it was.
Where I think maybe planners could have done a better job. Some of them, is the ones that didn’t really have the skills and weren’t really providing a professional service because there were sort of half half right, maybe you don’t agree with this, but my assessment was there was sort of ones that were always providing a, you know, holistic, professional service that they could have charged for. And there were others who were still doing a great job at what they do, but they were effectively salespeople for financial products and insurance products, and I think had they been a bit more upfront with people that that’s what they do.
In the same way that when you go into a Nike store, you don’t expect to get an objective piece of advice you expect to walk out with Nike shoes, right? So, I think, had they been a bit more honest about the transactional nature of their work, then all of this could have been avoided. So broadly I think the industry had a bit of an honesty problem, but I think that was the way it was set up by the people that owned it.
So yeah, I would encourage people to go and see an advisor. My advice hasn’t changed that much.
Because I mean, I was never on this ‘let’s re-educate them’ campaign. My view was always, if you need advice or if you have got responsibilities in your life that you think you know would benefit from some external advice, and I think that’s most people if not everyone go and meet with a local planner and see if you connect with them on a personal level and if you do, then there’s a good chance that you can trust them and then you’ll benefit from that.
And if you get a bad icky feeling from them, or you think that they’re putting on a bit of a show, or you wouldn’t want to spend time with them personally, or recommend your mother to go and see them, then get the hell out of there. And I think that’s the best. You know, my advice hasn’t really changed as that regulations.
00:18:20 Mark
Yeah, and it’s logical Aleks because as you very well know there are good and bad journalists. There are good and bad lawyers. It’s an industry that has human beings in it and the nature of the beast is always going to be that some will be better than others.
Some will be, equally as good, but as you quite rightly point out, you know a great advisor for one person might not necessarily be a fit for another, and it’s and it’s getting that fit, right?
And you know you combine that sort of heady mix of a good fit and competence. And I think the outcomes are usually very strong. Now between the sort of finding that passion for all things in financial journalism, there was a sabbatical. Which kind of, I suppose, drifted back to your love for politics and some of the things that you sort of talked about earlier.
And I note that both you and I obviously have books behind us. This one does always live here Aleks, it’s not just for today, I this was the result of your sabbatical. So, do you want to talk a little bit about USA G’Day and how that came about?
00:19:16 Aleks
Yeah, I think you’re in the elite club of people Mark that has read it cover to cover, that you can almost count them on a couple of hands.
Now look, the plan wasn’t a book, as Mark knows I’ve got a lot of family in the United States, that was the main motivator. And actually the first time we went overseas on a study tour to study the financial services industry over there was the first time that I’ve met a lot of them, and again they are from the old country, and I was very interested in what we saw overseas with some of the sort of rising trends that were starting at the time and you know, sort of we had a real ground floor view of some of the Fintech revolution that was about to happen.
And if you fast forward to now and sort of GameStop saga and the entry of the millennial investors, all of that was starting to brew when we were there because you know, there was a real revolution in the economic and sort of the industry was shifting from Wall Street being in charge to Silicon Valley being in charge. And we were sort of, that’s fundamentally what we were writing about, although with the kind of niche of wealth advisors that was kind of what was underway so, I was interested in that.
I’ve always kind of covered American politics, so I went overseas for a little while and spent some time in Washington through a contact of the family.
I was an intern which was a great kind of experience of being cut down to size. You know, having been in my late 20s an editor of a magazine and sort of starting to enjoy being a big fish in a small pond.
To then be in Congress and being you know, an absolute nobody and a foreigner answering phone calls from people in Texas making complaints to the local member, it was pretty fascinating.
00:20:48 Aleks
And then travelled around the country and wrote a blog that ended up being this book USA G’Day, which people can find on Amazon and sort of had a mixture of writing about my travel experiences, writing about the election which was happening, that was in 2016, and then the sort of financial services piece as well. It was an incredible experience being in the States and then came back to keep covering financial services actually and sort of take what I’ve learned over there and keep writing about it was a fascinating time to be.
There actually are a lot of parallel ‘cause you know what we’re talking about. I mean, it was Brexit there was the Trump election and I was lucky that I spent time out in rural and regional areas.
You know, talking to people who were clearly about to vote for Trump, so I had a very different understanding of what was happening to a lot of my colleagues back here who just thought it was terrible. Not that I would necessarily have voted for him, of course, but I did understand why they were gonna do what they were about to do and why they are rolling the dice on this clearly volatile and inexperienced person.
And to put it mildly, and I think that again I came back to that same kind of Yellow Pages approach, which has been my approach to journalism, you know I have tried to understand root sources that speak to regular people and you wouldn’t think that that is such a sort of innovative approach, but it is because you can see in the paper and on telly every day and you only have to watch the CNN reporters on election night trying to hold back their tears and remain objective when clearly everything that they stood for as people had just eroded, and they had this real crisis of trying to remain objective. Which is fine, except perhaps it’s like financial services.
00:22:23 Aleks
Perhaps they were pretending to be providing a professional service. They’re not, you know, but there was an element of advocacy and ideology in in what they were doing. And this whole Trump thing had kind of exposed a little bit, whereas for me I was much more always with the view and meetings for businesspeople for the years before that had kind of cemented that in me.
We shouldn’t necessarily just assume that people hold a view because they are bigoted or they lack education, or they lack this sort of capability to think deeply and critically about issues. And I think that’s the problem that we have as a party which most of the mainstream media really perpetuates, which is, you know, if you don’t come to X conclusion, then there must be some deficiency in your thinking, and it must be a lack of resources that went into your educational and that wasn’t more experience of the Trump voters, and equalling that wasn’t my experience of the suburban financial planners that The Sydney Morning Herald was telling you, you know should not be trusted and are only there to, you know, use you to buy a Ferrari and go to the Gold Coast or whatever the perception was, right?
00:23:24 Mark
Yeah, it’s interesting Aleks that you make that observation. And the book, I think the book does have really for me it did a fantastic job of providing some logic and some framework around what from a distance felt like something that was you just couldn’t understand why it was happening.
You know why are all these sensible people voting for a person like Trump and the book? I thought it did a fantastic job of providing some reference points to why that might be happening, it is legitimately the last book I read undisturbed over a period of just a couple of days, cover to cover and the reason that that’s the case is because I had something in my life that changed.
That was because having had adult children and having some of the re injection of carefree life that you were having as a single man.
You know, for me, it was kind of second time around with the birth of two beautiful little girls, which was an amazing experience for me, but not too long after that I suddenly met Aleks and was introduced to your now lovely wife, Belinda, and it was a different Aleks that I encountered, of course. And now of course, there’s another major event in your life.
With the birth of your daughter so do you want to sort of talk us a little bit through that and then kind of just get to the article that you wrote in Finn review, and it was the article probably that was the catalyst for this to invite you onto the podcast because you know it resonated so much with the work that we do. So, do you want to just go through that?
00:24:54 Aleks
It’s almost certainly at a point in my life where I was getting more and more ready to settle down. And Belinda actually was an old friend of mine from high school days so that ended up being a quick and a very lovely process.
Coming back to Australia, she’d just come back from London as well and was moving back to be close to her family, so we’re in very similar stages of life. And of course then the pandemic, yet, which last year? You know, we’re meant to get married in September, we had an engagement party actually on March. I think it was the first weekend in March and it was right at the point when people were sort of shaking hands. Sort of. Not everyone was a bit weirded out.
We had the engagement party on Saturday, on the Sunday we’d been covering it at work. Some of the more sort of larger corporations had started to go into work from home. We get the message saying don’t come in on Monday.
That was really it. Locked down period started from there and we ended up getting married in September. Just with our family. But the big fat Serbian wedding was postponed, and actually it was really interesting because I had, you know, always seen myself as an extrovert. Certainly it’s always been helpful in my work to get to know people quickly, to build a trust and for them to genuinely like. You know is something that has always been beneficial for me in my social life and in my professional life.
And so I’ve always enjoyed being around lots of people. But my wife is cancer and a bit more of a homebody, and actually the sort of locked down, period with us just fine, we read a lot of novels and drink a lot of tea and my lifestyle has changed by rapidly, which was good because we ended up having a baby bear earlier than we’d anticipated, because hey, why not?
Right and lockdown conditions were well suited to it, and we figured we wouldn’t be doing those final travels that we’ve planned as kind of our last. There are like many people, those were sort of taken away from us, I suppose, although I can’t really complain having had the experiences that I’ve been lucky to have over the 10 years before that.
But yeah, we had a little girl in September, and its only sort of, I guess, really exacerbated. Those feelings have changed. If you do follow that and yours is a different story, Mark, I suppose because you know you had kids relatively early, I think you would have been probably younger than I am the first time and then having this amazing experience again the second time. But I.
00:27:11 Mark
Either that Aleks or I’m a lot older than I think yeah.
00:27:15 Aleks
That’s why I suppose a lot of people who do get married and have kids in this sort of early mid 30s would go through this process of going from bachelorhood to fatherly or family life quite quickly.
I suppose the pandemic has been a bit of an easy and you know we bring our life a lot more social now than it was, you know Six months ago, or a year ago, you know it is pretty quick shift mentally, particularly because, and this is what I wrote about during my paternity leaves. I thought I’ll write something about paternal leave.
00:27:44 Aleks
My original idea was to write something about the kind of economics of paternity, leave and kind of back it as an idea and try and convince business owners that it was a good thing to do. And I had an element of that. They’ve become my own, you know.
I sort of got like many people in my generation had started taking a more active interest in investing really over the last year or so, which is not unusual given my age and the economics and everything that we’ve touched on previously.
But it is slightly unusual in that I’ve written about investment for 10 years, so people would think I had a burgeoning portfolio at that time. But one thing was that I didn’t quite have the income to sustain one and the other one thing was that I didn’t have the lifestyle.
And we’ve spoken about this in the past Mark, I know that compared to some of your colleagues, you know you’ve always been an advisor that has embraced people you know living their full lives, and if that means spending occasionally, that’s OK.
I think you never frowned on me for some of my decisions to at times take debt field trips to third World locations and delivered upwards. You might have been thinking it but a lot of your peers were very cranky at me and said I was being irresponsible, and we’re very kind of old school about it, and so I’ve always been a devotee of that view and now is well fed here at the Finn.
You know, I guess people look to me to have these kinds of views on things, and I’ve always been pretty millennial in my focus that you know, I don’t think necessarily the goal of life is to just stack papers and leave a request. The industry has vested interest in that, caring by the way that it has traditionally charged of course, you know 1% of a nest egg is a lot more lucrative than 1% of nothing because you blew it on a cruise in your last few years of life, right?
I’ve always been of the view that people should occasionally, to whatever extent they feel they want to spend as well as invest in safe and for me personally, credit cards were a big part of that journey because I’ve exhausted Bank of Mum and Dad. I wasn’t earning enough to live the life that I wanted to live, and so I decided to take on debt to have some of the experiences that I had. Now. Maybe I think I should dispose that. That maybe comes from a position of power that I was able to do that. I mean it was never my goal to just, you know, want only max credit cards and then pass on that debt to my family one day like I suppose I did have an inherent understanding that maybe my level of education and so on allows me to pull myself out of that debt more quickly than some.
And obviously I had a. You know, I was lucky to have a fairly sophisticated financial literacy now thanks to the years of talking to planners everyday, right? Which again wasn’t part of the plan that’s saying that I’ve been very lucky to happen, but I’ve always been known for being a big spender who took cabs everywhere and lived the overly lavish lifestyle and I’ve always been sceptical of people who were a bit more miserly and sceptical of the industry that profited from, you know, a view that people should be mindful. Yeah, exactly profiting frugality, right? It changed pretty quickly Mark for me.
00:30:33 Mark
From frugality.
Look, you know you’ve probably heard me use this term before, but you know we give a name to what you’ve experienced.
Essentially, we kind of tag it as a money moment, there are many versions of money moments and certainly the birth of their first child ranks right you know to the very top of that list with other things you know. That kind of you know.
I’d say the equivalent in terms of what can actually be retirement and that moment where you switch from earned income through to drawing on capital and I had a wise old fellow say to me. I’ve always sort of held to the view that it’s impossible to understand what it’s like to have a child unless you have one, that’s something that you would probably be able to identify with at this moment, but I think this wise old fellow said to me, you know you can’t possibly know what it’s like to imagine that you’ve only got a certain amount of money to draw down upon for the rest of your days, and there’s no more earned income coming from anywhere.
There’s no other funding this is it, yeah, and to go through that moment and to understand that you’ve got to emotionally cope with that transition and again, you know that’s a huge and very identifiable Money Moment so we kind of have always tried to combine that with then some analysis around values and you’ve just probably spent a couple of minutes really talking actually about Aleks. His personal values now that your personal values as you said, you know your debt was underwritten by your talent to some extent, and you’re earning capability.
And a little bit of subsidisation.
00:32:16 Aleks
I should admit right because as many of your clients I’m sure going through that’s more of a reality these days than it was in generations previous. But it would be remiss of me to pretend that was entirely self funded.
00:32:30 Mark
Absolutely, and there’s a tacit understanding of that. But when I read that article, it’s a validation in terms of the way that we sort of think about giving advice, which really as you very well know, is about understanding and examining our clients values as a primary and then kind of identifying what goals and objectives are around that. Because if your value is having experiences and you’re perfectly comfortable with that and you’re comfortable about going into debt. You’re comfortable with the financial repercussions of the life that you were living. It’s perfectly appropriate for an advisor to in some way support that because it’s what Aleks wants to do with his life.
00:33:08 Mark
It’s not for an advisor to impose frugality in my book. Now you might put some rules and you might have some constructs around that, but fundamentally, I think if you examine somebody values properly and build a financial strategy around those, as opposed to dictating financial strategy via frugality, I think that you actually land up often with much better outcomes. And as you’ve just discovered, it doesn’t stop you from transitioning into a different kind of financial arrangement when your life determines that that’s appropriate.
00:33:40 Aleks
Yeah, well, that’s right. For me it was a values shift and you can’t necessarily plan for. I guess you know that it is the done thing, but I suppose for me it was very much a money moment of, you know, looking at a newborn child who is totally vulnerable who is effectively born into poverty, that is our natural state. It’s only a few seconds after that, that somebody chooses to subsidise us because they’re taking responsibility for that child that you know, needs you to survive really. And it was that moment, you know you really is that every time you’re spending on a cab, and this is a personal thing others may choose to continue to do that.
I’m all for supporting cabbies but for me it’s like there was an element of intergenerational theft that creeps into your rewind, right that it’s a 20 bucks versus $1.20. And now that I understand, compounding it’s 10 bucks that can be frankly put to better use for this kid, and that’s just where my priority lies now rather than my own comfort. I mean, I’ve got occasional cabs, of course, not always.
00:34:40 Mark
Absolutely, especially if you’re with me. We’re not jumping on a bus together.
00:34:43 Aleks
Well, yeah, if you’re buying. You know it has been about leadership, but even you talk about that advice process of Treysta and a far more involved process than some of your peers probably have gone through with that focus on values, but even some of the basic tenants of the industry for me are now resonating more.
I mean, the whole kind of peace of mind thing you know, as a journo and cynic has always just struck me as just marketing and so particularly from fixed income managers and bond managers and super funds when they’re talking about their balanced options.
You know it gives you Peace of Mind and I frankly always just thought that was crap and that there was a whole industry of people who were there to try and pray on fears and try and get people who should be in aggressive portfolios into bonds and so on. And there I was, you know, sitting in hospital, applying for schools and putting money into a bond fund.
Which was, it is, you know, frankly, maybe not the right thing in the short term, given yields, but nonetheless probably I could benefit from some advice, of course.
And also I did feel a sense of Peace of Mind. It was a long term decision to, you know, make an asset allocation change and I figured having listened to so many planners over the years, you know I’m not responding to the market.
I didn’t even know what bonds were doing. I wasn’t looking at that in hospital. I was looking at school fee prices better is making an awful your decision off the back of that.
It did strike me. I said any planners reading this or who are laughing because they’ve heard me, you know, have a go at them over the years. You know they’ll be enjoying reading this, but also most of them are dads anyway, so I’ll probably just understand.
00:36:16 Mark
Exactly.In the interests of time, we’ve kind of got to bring this in for a landing, but you know, we could probably happily chatter away, hopefully in an entertaining way for longer, but Treysta is definitely bringing this together and there’s a launch of a new software platform that we’re using which is Lumiant and the design of that is really to support you know people in living the way that they choose to, given the resources that they have at their disposal and to try and help them live, you know more closely to their value sets and have a platform that they can interact with on that basis.
And you know to remind themselves you know more regularly, I suppose what’s important to them, and to make sure that the way that they’re spending their money is appropriate relative to the values of and the objectives and the goals of the family. So, it’s quite a powerful tool that we’re continuing to develop and rolling out.
Look with that said, Many thanks. It’s been a delight to chat to you. It’s probably way too long since we’ve kind of done this as a couple of mates anyway, so hopefully we can rectify that in the coming weeks, but.
00:37:13 Aleks
For everyone.
Yeah, I’ll get ahold pass.
00:37:20 Mark
Yeah indeed, yeah me too.
I thank you for graciously giving up your time today, and hopefully people will, you know, watch or listen to this podcast and enjoy what we’ve put together. So, thanks once again, Aleks, it’s a real pleasure.
00:37:36 Aleks
Well, thanks Mark, I’ll come back in to do another money moment at retirement.
00:37:40 Mark
Maybe they’ll be 1 or 2 between times mate.
We’ll see.
00:37:44 Aleks
Sounds good, thank you.
00:37:47 Mark
Good on you.
