Growing OId at Mid-Life Podcast Featuring John Simkins

Listen to the full conversation here:

John Simkins sits down with Conrad Kanagy to explore retirement and shares his expertise as a financial advisor on Conrad’s podcast: Growing OId at Mid-Life–Discovering Hope, Health, and Wholeness.

Read along as you listen:

Conrad
Greetings, friends, and welcome to this podcast, Growing Old at Midlife. My guest today is John Simpkins of Stewardship Advisors, LLC in Mount Joy, Pennsylvania. John, I want to thank you and your firm for being a sponsor of this podcast, and for being part of the show today. I was going to have you on the show down the road, but with the economy doing what it’s doing, I thought our listeners might be interested in hearing what someone of your expertise has to say to them, as they are in midlife and growing older and thinking about what’s happening to the market, what’s happening in retirement. So why don’t you introduce yourself, and your firm? But then we’ll get to that question of what kind of accounts are you giving clients these days?
John
Okay, well, thanks for having me on, Conrad. I really appreciate it. And so Stewardship Advisors is a fee-only fiduciary, meaning that our clients, the only one who pays us, we have no other revenue stream than working with individuals, businesses, or charities. We work with a variety of clients in different aspects of life. And so one of the benefits that we provide as a fee-only fiduciary, is we can provide confidence that we’re looking at you in a way that is trying to be the good steward. And that kind of goes to our name, Stewardship Advisors. We want to help individuals maximize being that good steward. There are choices that you get to make, and part of that is understanding what those are. And that’s what we bring to the table, is to provide clarity and confidence to move forward.
Conrad
So, John, as a founding partner of the firm, can you give us a little background about what the vision of the firm is and its origins, and what’s the kind of direction that you’re going at this point?
John
Yeah, when Stewardship Advisors was founded, we were looking at focusing on our clients. We wanted to make sure that they were the centerpiece of the relationship. And so we’ve always looked at clients to be the most important part. And being the fee only really makes that really important. Some people, I get asked, well, what do you sell? We don’t sell. We advise clients. We help them build financial plans. We help them understand what they need to retire. We walk them through all phases of life. And so it’s about the relationship that is the most important part to us.
Conrad
John, what are you saying to clients these days with the market the way it is? Is everybody freaking out or running away from the market? Or how are you helping folks who are 55 plus these days?
John
Well, 55, it doesn’t matter. A blog on riding the roller coaster. Are you prepared before you get on the roller coaster? When you look at riding the roller coaster, you see the ups and downs of the roller coaster you’re about to get on. And are you prepared to ride it all the way back to where you got on the roller coaster? And so helping people understand that not a lot of people are freaking out that I talk to. I have new clients coming in from other places that are freaking out, but it’s helping individuals understand. So if you go back and think about 2007, 2008, 2009, the market’s selling off. We had the peak in October 2007, that bottom was in 2009. And if you were relying on selling part of your portfolio to fund your living expense, you had to sell more to generate the same dollars. And so when we work with clients, we’re helping them understand the longer perspective and making sure they have cash available to meet those short term needs. So this is just another opportunity to go back and it’s a great check to say, okay, are you still okay in this allocation? We talked about your cash needs and that’s one of the critical conversations we have with our clients is about cash flow, especially in retirement. And then when you move into a continuing care, the CCRC: Continuing Care retirement community, you need to make sure that you have resources available that you don’t have to sell at the bottom of the market. Actually, I get very few frantic phone calls anymore.
Conrad
And is that because of you, John?
John
Of course, it’s because of me, Conrad. I’m here.
Conrad
I have no doubt, John. I have a couple of questions related to the themes of this particular podcast. And one of those is how do we, as we age, regenerate ourselves? And by that, I mean how do we take the best of whom we’ve been, the best of who we are, the best of what’s within us, what we’ve done with our lives, and that includes our money, includes what we’ve invested in and reinvest it in other people or activities, energies. Because we know that regeneration actually causes people to feel happier when they’re giving of that which is the best of themselves to others. Serotonin levels increase. We actually know that brain cells can be replaced and grow as people regenerate and give of themselves as they get older. So I wondered if you have anything to say about how people might do that or how you’ve seen people do that, take what they have and invested in ways that really do regenerate and produce ongoing legacy of their lives.
John
Right. And so I’ll reach that in two parts. So the first one is we do a lot of questionnaires with our clients because we want to make sure that we’re recommending and talking about things that are important to them based on their value system. We’re asking questions like how was money when you were a kid? What was your best financial decision? What is your goal when you reach retirement? And that goal is not just like your dollars. It’s like we do what’s called a wheel of life and we ask people about their spirituality, their relationships, their household, their finances, and asking them to just rate on this wheel, is it one or is it a ten? And then we just connect the lines to see where the flat spots on the wheel are. And so it helps us when we’re going through and saying, okay, I’ve had clients talk about spirituality where they’re like, I really want to go to a spiritual retreat. It’s really important for me. So when we’re building a retirement plan, we’re looking at funding these things for them to say, okay, you said you want to do this and what the cost is. And so we’ll build it in. And when they get there, like, okay, we allocated dollars for this and your retirement plan works out, so you need to go spend that. When we build these things. Also about retirement, we look at in three phases. Phase one is that go, go, I’m retired, I got the health, I got the cash, and I can go somewhere. And typically that lasts about ten years, sometimes a little less, sometimes more, depending on the individual and the health. And then we go to the slow go. Where it’s a little bit more challenging to go, but they can do it. It’s a little bit more intentional. There’s usually a different way that they travel and then there’s the no-go stage. And that’s when you’re in continuing care retirement community and you just don’t have the physical ability to go by yourself. Someone has to come and pick you up. So we look at that and we plan those additional dollars for the go-go and the slow-go. And then the no-go we have the medical expense was typically the drainer of the assets that is helping individuals understand when we work with them about, hey, I said I wanted to do like, a mission trip. I know individuals that go to a specific camp each year in another state. They volunteer their time at the camp, so the camp houses them and feeds them so they don’t really have any additional expense to do this. And then they go on day trips in different areas. There’s all kinds of different ways to think about what are you going to do. I agree with you, Conrad. When individuals are still active, their life is more fulfilling and their quality of life is dramatically improved.
Conrad
Well, let me get personal and John and ask you. You and I are about the same age. You fell off the roof. No, actually, I fell off the roof.
John
Well, you fell off twice. I only did once.
Conrad
You fell off a ladder. And this is public because you’ve blogged about it, actually. How can people access your blog? Is it the website?
John
Yeah, it’s mystewardshipadvisor.com
Conrad
Okay, so folks, I want to encourage you to read John’s blog, but you learned some things from that incident. John, can you repeat some of that for us?
John
Sure. So household ladders are high up in home accidents. And I didn’t think about that. But I was home alone. It was the 1st of December. I was watching some football. It was halftime and I thought I’d go out and get the decorations out of the storage space up above things and I was moving stuff around. Lost my balance about 8ft up and fell and landed on the floor. I tried to do one of those with the Olympics where they stand and raise their hands. When I landed, I tore up my knee. I tore the ACL, the MCL and the Meniscus. And I’m like, oh, it just hurts. It doesn’t really bother me. Painful, but I can get up and walk and stood up and fell back down again. And I actually shattered some pictures with glass on them. So here I am, home alone in my garage, no cell phone. And I’m thinking, my estate plan is in effect, but I don’t really have a plan in place to take care of me if I get injured at home and how do I contact? It was a blessing that I was able to use. This is a plug for Apple. I used my Apple Watch because my phone was two stories up at the other end of the house in the bedroom, and I’m in the garage on the concrete floor. And I was able to connect one time of many that I tried to get hold of my daughter who lives 20 minutes away, and her and her husband came over and they called the ambulance for me and they took me to the hospital. And so I had some surgery later on, but it really helped me. As I work with clients that are single, living independently, we’ve talked about different things. I had one lady who gave me this idea. She goes, “I’m alive call” every morning. And I was like, Help me understand that. And so it was another single woman living alone. They would call each other at a specified time in the morning to make sure that they were okay. And if they didn’t, they know who to contact. So you have to be very intentional when you’re a single person living at home. Fortunately, my wife came down and was visiting me that evening in the hospital. But it is important to be intentional about what if you’re a single living at home… who’s checking on you? When you start reading about the accidents that happen at home, apparently, extension cords are very dangerous for individuals that have mobility issues. And I’ve actually had an individual I know not too long ago last year, trip over an extension court as they were trying to move something at their house and they fell and broke a hip and they were in the hospital. And fortunately, someone came to check on them because they do live alone.
Conrad
John that became a kind of metaphor that you use then in thinking about preparing, because I think as you were lying there on the floor, you were thinking about the fact that you weren’t prepared for this.
John
Yeah, I work with individuals. The other part of that question I get to is, like, in creating the estate plan to make sure you’re giving money to the charitable intents that you want, how to do it, how to maximize the gift, look at the tax implications. So that’s the financial piece, but it’s like this living piece is kind of not thought about a lot. I mean, when I talk to clients, who follows up on you? Who are you talking to? Especially even an elderly couple, you still have high risk if you’re living alone. Like, who is checking up on you? Who’s helping making sure you’re getting to the store? Are you still able to drive? And so there needs to be things in place for those that are living independently that you don’t think about as two as a couple living together.
Conrad
There’s a book by a sociologist called Going Solo, and it talks about the increasing number of individuals in the United States living alone and the risks that come with that. And so you’re attending, It sounds like some of that as well. John, I wanted to ask you about spirituality, because that’s also a theme of the podcast and faith. And just how does faith and spirituality, one’s faith and one’s spiritual life, connect with finances? How do you observe that? How do you see that, or how do you integrate that in your own work?
John
Well, part of it is asking about it, and so we ask about it in a different way. And part of it is the charitable intent that you could have in your estate, but also your current giving. Like charities. What charities? Are you active? Because when people retire, you need to retire to something. You just don’t one day say you’re planning this retirement for years. You get there, and it’s a day on the calendar. Now what do you do? And trying to rethink, because your whole life and your whole persona is based around what you’re doing, to some extent, are you prepared for that mental shift to say, okay, now I’m retired. How do I identify? And so it’s helping individuals sometimes connect with different organizations that they value. When people are preparing for retirement, I spent a lot of time talking about, okay, so what is your normal week going to look like when you retire? Because I advise clients, like, if you’re retiring on a Friday, going on a week-long vacation, the next week you’re retired, you don’t have to go to the office anymore. But what are you doing? What are you looking forward to? Because that becomes very critical about mental health is what are you looking forward to and what interactions are you going to have? Because you’re not intentional about that. They’re not going to happen in your world is going to start to close in because you’re not going out anymore. I mean, if you go to the nursing home sorry, CCRC, right? If you go in and you’re there and I meet with some clients there, and I remember I was talking with an adult son, right? And he’s probably in his sixties at the time, and his mother was in her late seventies, and they announced that mail is here. She’s like, oh, mail is here. I got to go get the mail. And she just got up and left and got the mail. And I was like, that’s a highlight of her day. He goes, oh, yeah. They look forward to that because that’s like the next step. It’s like, when’s the meal? When you go get mail, when’s the next activity? Especially when you look at that servant heart. Who are you helping right now? What are you doing to continue? Because there’s a point in the no-go or slow-go phase where you may not have that opportunity, but we help individuals look at participation is important. Like, oh, I don’t know what I can do. Well, here’s some things. Or did you connect here? But then there’s also the financial piece. Conrad, you’re not old enough for this yet, right? So at 72, when you have to take money out of your retirement account, you’re allowed to give part of that required minimum distribution. You can give up to 100,000 a year or something like that to a charity. And we give our clients checkbooks and they write a check out to that charity. So now they’re giving with money that would be taxed to them as income because they only get the standard deduction. So we look at how to maximize charitable giving in a tax efficient way. I mean, when you’re looking at someone like, I gave this money, but I can’t claim it on my taxes, well, here’s a way to do that. We also look at not only the individual in the mental health and the interaction but also on the financial piece.
Conrad
John, you’ve been doing this long enough to watch a couple of generations of folks go through the process of planning for retirement and investing in the retirement. What changes have you seen in values or in the way people approach this? What have you seen that maybe you consider positive? And are there any downsides to the way people are thinking about the future today or investing that you find yourself wanting to correct or to encourage differently?
John
I guess the changes, the biggest changes is when you think about retirement, people don’t look at the total length. I was just doing a retirement analysis this week, and they’re going to live 28.7 years when they retire based on statistics. So we got to think about that and say, okay, at the beginning of your retirement, they’re like, oh, I get a lot of comments about a rule of thumb. They’re like, I should only have as much stocks as my age. And I said, but you’re only going to live 28, 29 years on average in retirement. If you go too conservative, too early, you pick up inflation risk. If you do too aggressive, you pick up more market risk than what you like. So you really have to look at the risk tolerance of the individual and then how that risk profile fits into your growth needs so you can continue to live, and maintain the lifestyle that you want in retirement. But I would say what I’ve seen from when I started is retirement is more active there’s, I think greater at home. People want to age in place a little bit more. It’s not so much I need to move, I need to move into the retirement community now, but I’m seeing a little bit more stay-at-home, maybe adjust the house. That’s important as you think about getting ready for retirement is where do you want to stay different? It used to be you would stay in the county, and then I’ve seen individuals move to wherever their adult children are, so they have some relationships in the area. And I’ve seen people move to know where none of their adult children are because of the area. I’ve seen people move to states that are less tax than Pennsylvania. I have some individuals that are just ecstatic that their taxes are one third of what they were paying in Pennsylvania, and the cost of living is less, and it just magnifies their lifestyle. Other people go to south, to Florida because they want that. Some people are going out west. And then you have international retirees. So the world is really open to where you want to retire based on what kind of environment you want to retire to.
Conrad
John, I’ve got a closing question then. Ask if there’s anything else you want. But sometimes you hear the saying that people die the way they live. I guess I wonder, do people retire the way they’ve lived their lives also? I mean, is there a continuation here of the way we’ve lived our lives? And I don’t know, any thoughts about that?
John
It’s magnified a little bit. So let’s break it down into the category, they were spenders, that they spent a lot of money they didn’t save. Well, they’re going to have the most adjustment to the lifestyle because they can’t maintain what they were doing with what they have. There’s an adjustment needs made, and then it’s the savers. The hard part for them is to realize that they’re going to use some of their savings to fund their lifestyle. And so part of the conversation is helping the spenders adjust to say, okay, this is where we need to be. What can we do to stay within a spending limit? And the savers is like, okay, we said we were going to spend this. What are you guys doing? Where are you going? What’s going on? Because it does magnify because you’re not certain what’s going to happen. And there is an initial shock of, well, I’m no longer receiving a paycheck, I’m just getting Social Security and what is that going to look like? So helping individuals get ready so they understand what that income is going to look like so they can adjust their lifestyle accordingly. But if a person was active before retirement, they’re going to get a little bit more active. Typically, especially if their health is good, they’re going to do things that they were waiting to do. And if a person was a little bit more stay at home, stay in the area, they’re going to slow down a little bit. And those are the ones that need to have the interaction, have like, hey, I’m going to volunteer at the church on this state or this organization that helps them maintain their world from shrinking.
Conrad
John we sometimes, as teachers, have our students prepare an elevator speech. They’ve got 30 seconds on the elevator with a stranger to tell them something. What’s the 30 seconds? If you have 30 seconds with someone to tell them about, to talk with them about retirement, what is it for you? What’s the bottom line for you in investments in retirement?
John
Yeah. Most people find finances confusing. We provide clarity and confidence in the decisions to help you move forward.
Conrad
That sounds pretty convincing to me. John, is there anything else that I’ve missed that you want to share? You’ve been very helpful. We’ve gone a lot of places today and you’ve been really helpful. Anything else you’d like to say?
John
Yes. When you think about preparing for retirement or just looking at things, it’s good to get like a self-check. What is important to you? Because there are so many different aspects of the financial planning piece, whether the investment side, or just the estate planning. But the core is helping individuals understand what’s important to them and then we build around it. A lot of times, I guess as the planner that I am, it’s just second nature to me. I always think about what we’re doing and where we’re going, what’s going on, but it’s like for sometimes just getting them to structure, to sit down, it’s just amazing to see that revelation and say, oh, I can do that. And I’m like, yeah, you can. And so that to me, is what brings me in the office every day.
Conrad
I was thinking that must be the case because you lit up your affect. You broke into a grin and a smile, as you did just now. But when you described that, John, so it clearly lights your fire and it’s what you’re passionate about, which makes you great at what you do. So thanks so much for being with us and thank you for helping to sponsor this podcast. I really appreciate it. And listeners, you can find this podcast shortly. We’ll post it. I’ll put it on my website and also on the podcast site as well. My guest today has been John Simpkins, founding partner with Stewardship Advisors, LLC in Mount Joy, Pennsylvania. Thank you, John.
John
Thank you, Conrad. Have a great evening.
Conrad
You too.