481. Portfolio Advice for a More Secure Retirement
Lesley Logan dives into financial independence with Steve Selengut. Discover actionable insights on managing your portfolio, minimizing risks, and building income-producing investments. Steve shares decades of expertise to help you achieve financial security and freedom.
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In this episode you will learn about:
- The meaning of income independence and why it matters.
- Breaking down portfolio basics for beginners.
- How to use diversification to minimize financial risks.
- The value of income-producing investments like dividends and bonds.
- Why emotional decision-making can hinder financial growth.
- How to vet financial advisors and ensure alignment with your goals.
Episode References/Links:
- Steve Selengut’s Website - https://theincomecoach.net
- Retirement Money Secrets by Steve Selengut - https://a.co/d/caqcgnT
- Vetting An Investment Advisor - https://beitpod.com/article
Guest Bio:
Steve Selengut is a 40+ year professional investment manager, advisor, RIA, and IAR who now coaches both individuals and fellow advisors on creating what he calls “income independence.” He wrote Retirement Money Secrets, his second book, which uses a conversation-style narrative to guide readers from chasing market value to building sustainable portfolio income. A former private investment manager for 44 years, Selengut personally oversaw around 325 individual portfolios in the U.S. and abroad. Drawing on a “department store” metaphor, he treats each portfolio asset like “merchandise on a shelf,” taking strategic profits while reinvesting for consistent growth. Selengut retired from day-to-day portfolio management in 2022, devoting himself to a coaching practice that frees investors from market-driven stress and uncertainty. He remains one of the few investment authors who have directly managed other people’s money.
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Episode Transcript:
Steve Selengut 0:01
It doesn't matter what the stock market is doing. It doesn't matter what interest rates are doing. It won't impact your income, your ability to live your life the way you want to financially.
Lesley Logan 0:14
Welcome to the be it till you see it. Podcast where we talk about taking messy action, knowing that perfect is boring. I'm Lesley Logan, Pilates instructor and fitness business coach. I've trained 1000s of people around the world, and the number one thing I see stopping people from achieving anything is self doubt. My friends, action brings clarity, and it's the antidote to fear. Each week, my guests will bring bold, executable, intrinsic and targeted steps that you can use to put yourself first and be it till you see it. It's a practice, not a perfect. Let's get started.
Lesley Logan 0:52
All right, Be It babe. Here's the deal. We're gonna talk money. I say it straight up on the interview. It's good stuff. Don't be scared. He is going to say words you may not know or you've only heard of, and you usually nod along when you hear about it, but he doesn't talk nearly as fast as I do, so he's gonna absolutely inform you in the best way about how to manage your retirement, how to not even to your retirement, how to manage your portfolio so that you can retire. This is a whole different conversation than what I've had in the past about money investment. That's a new way of looking at it. Honestly. I've never heard of it before, so I have a lot of, I have, like, notes that I'm like, okay, I gotta go research this. Gotta research this. I already have committed to doing the Be It Action Item. And the reality is, it's like, I want you to have whatever you want in this world, and money isn't a bad thing, right? Shitty people with money can be a bad thing, but you're an amazing person who listens to this podcast. You deserve to have portfolios that support you, so that you can support the people that you love, because I know how generous you are. You know, they actually have proven that when women have money, they actually put it back into the community. They support other people. And so I want you to have as much as you want and more than that, so you can continue to do that and be the amazing person you are and have the impact you want to make on this world. But first, let's educate ourselves. So here is Steve Selengut.
Lesley Logan 2:15
All right, Be It babe, we're gonna talk money, and I think I'm just gonna stay it right there. Do not fast-forward, skip this episode. I know no one like money, but we have to talk about money and being it till you see it. If you've ever been like, I just want to be good with money. I'm so excited for our guest today. His name is Steve Selengut and he is actually going to help us, really, he's going to demystify all this stuff that you hear. I mean, we hear negative stuff about the economy, we hear negative stuff about the stock market. And I'm really excited because Steve's going to help us understand not all bad things are bad, and how they can be good, and also how we can really take a charge of our money and our retirements the way he has for so many. So Steve, will you tell everyone who you are and what you rock at?
Steve Selengut 2:53
Sure. Thank you. Good to be on your program. My name is Steve Selengut, like you said, and I guess I'll leave it with what I was for about 45 years. I was professional investment manager where I made all the investment decisions for about 135-145 families, and ran about $110 million for them. Our objectives were always to put them in a position where they were, what we used to call it, income independent, that their portfolios generated all the income they needed to get their lives done, whatever that happened to be, whatever they wanted to do, you know, depending on themselves. Now I'm an income coach. I sold my business last May 23.
Lesley Logan 3:45
Wow.
Steve Selengut 3:45
A little more than a year ago, and started a coaching business. So now I teach people had to do that. I can't actually do it for them anymore, which is fine for me. Fine with me. I look at their portfolios and I try to put them on a path to what I call income independence. And it's something, it doesn't matter what the stock market is doing, it doesn't matter what interest rates are doing, it won't impact your income, your ability to live your life the way you want to financially. Okay? So that, I think that's a big thing. I mean, I've enjoyed being in that situation for a long time, and I know a lot of people are also there, but I also know there are hundreds of people out there that are really, you know, coming towards the end of their career, and they're saying, you know, I don't think I can replace my six figure income from my investment portfolio?
Lesley Logan 4:44
Yeah, yeah, no. I mean, that's one of the reasons I like to talk about this. Is because, first of all, so many people aren't taught about investment portfolio. I think the word portfolio might even need to be deconstructed for some of our listeners. And by the way, if that's you, don't be embarrassed. This is not taught in schools. They don't teach this. And I happened to when I was working for a high-end fitness company as a Pilates instructor, my trainer was like, oh, did you get on the 401(k)? And I was like, we have a 401(k)? And he's like, you have to get on there and you should just ask, like, they'll match the max. Just do that. And I was like, okay, that was my money advice in my 20s, was with my trainer at work. And then when I did reach out to someone who could help me, because someone said, oh, this person's helping with me with my portfolio, I was like, okay. I found out after six years of them doing it, that they had me as if I was an 80-year-old. There was no aggressiveness. A snail is more aggressive than what they were with my, so then I got really frustrated, because I'm like, I don't know enough to know that someone's screwing up with my money. And so I think we all would love to be income-independent. But also some people, especially after the pandemic, even though we're several years out now, some people had to rely on their retirement, so they're kind of starting over. So can you, first of all, break down what a portfolio is and then also kind of talk about, if you're someone who's where the income in (inaudible) is so far away, what are some things you need to know or should be thinking about?
Steve Selengut 6:11
I can try. A portfolio is really all your investment accounts, your IRAs, Roth IRAs, 401(k)s, speaking of 401(k)s, you'd be surprised how many people don't even realize they're investing in the stock market. 401(k). They just think it's a 401(k) is the investment. But all of those things put together your personal accounts, if you set aside money for your kids already and education stuff like that. That's all part of your investment portfolio.
Lesley Logan 6:41
Okay.
Steve Selengut 6:41
Doesn't include your fancy jewelry and your cars and your stuff like that.
Lesley Logan 6:46
Okay.
Steve Selengut 6:46
So there's two types of securities, two general classes of assets that would be in a portfolio, and those are equity-based, where you own an interest in a company that would be a stock. You know? Anytime you want to share a stock, you are an owner of that company. They may not treat you like an owner, but you are. And then there's the other class of securities or securities you're in, mainly because they produce income, and those can also be dividend stocks, which produce some income. Some funds do as well, but what's inside is usually bonds, preferred stocks, mortgages, things of that nature, that are really, they're there. Your main purpose is to get income from them. So the combination of the two, like you alluded to, was, you know, when you're younger, it's okay to have more of an exposure to the ownership side of things, stocks, than when you get to be, you mentioned, those people that are 80, well, I'm only a few, six months away from that.
Lesley Logan 7:57
No way. Stop. You guys have to be watching YouTube right now. No way.
Steve Selengut 8:01
But, you know, you, at my age, my account still contains 35% in the stock market, but mainly because the kind, the way I invest in the stock market is also in income-producing securities that just happen to be invested in stocks, and the type of securities that I use are not very well known. You'll never find any in your selection universe for a 401(k), for example, but a lot of people have discovered their use in IRAs and things like that, because they're actually managed to produce income and to give it to their shareholders. Whereas stocks, the company's management is there to make a lot of money and to grow its influence and size, not to give a lot of money back to its shareholders. Mutual funds are there to gain market value. That's their primary objective, because people feel good when their bottom line is high. And the same with ETFs, their focus is on growing the market value. The dilemma, as you again, you mentioned the crisis around COVID, when the market really crashed for a couple of months, fortunately or unfortunately, when we get done with this conversation, you will agree with me that if it stayed down longer, it would have been better. You know? So, you know, so that kind of thing happens, but when you're focused totally on market value, that becomes very painful and very scary, because when the market value goes down, you know, that's what you're, what you're all about, whereas in my eyes, when the market value goes down, I recognize that the securities I have are going to pay the same income, irrespective where the market or interest rates are going. So I see it as an opportunity to add to those securities at a lower price, therefore increasing my income percentage.
Steve Selengut 8:34
That makes sense to me. Like, you know, someone we work with, they're like, okay, it's an election year. Here's what you can expect. It's gonna go down. It always does. Doesn't matter who's in office, of go down, and then that's when we can invest more, because you can get it for a lower and I was like, oh, okay.
Steve Selengut 10:23
Okay, that's, that person has the right mindset, a similar mindset to the one I have as an income investor as so that's what a portfolio is. That's what its content is. And everybody says they talk on radio shows and stuff, but all the uncertainty is way up here. It's so high.
Steve Selengut 10:44
Is there ever certainty?
Lesley Logan 10:45
I know.
Steve Selengut 10:46
There's never, ever certainty.
Lesley Logan 10:49
There isn't. I know. And everyone's out there like pretending like the past has certainty in it. If we all looked back at how we're feeling, it was pretty uncertain. I've heard you talk about how a portfolio is a department store or like, a shopping center. Is that what you mean we have these different area, like, different types of things that can go in the portfolio. Is that what you mean by a department store or a shopping center?
Steve Selengut 11:13
You're good. Exactly, exactly. You have to, my mindset, I, and I guess we have to realize there are thousands of different types of stocks, all different sectors, healthcare, every different imaginable sector, then there is international. We are, regardless of what anybody tells you, a global economy. You know, we rely on China, even though they're angry at us all the time, and we're the same with them. It's a global economy, and you have to position yourself with this portfolio so that you own a little bit of everything. You have a presence in each place. It's difficult to do if you're just doing individual stocks, because it requires a lot of money to have all those different things, right? But when you use income-focused funds that I use, which are called closed end funds, and we can get into more with what they are, but you can get them in all shapes and sizes, all sectors, all focuses, income or equity. So that's what I use. And like you said, I think of them as merchandise on the shelves in my department store, you know, and I set a target markup which I'm comfortable with that profit, and I'll sell that merchandise because I know I have this unlimited supply of others to replace it with on my shelves. And that's exactly how I do it. I say, okay, I got a 5% markup. That would be nice if you had that in department stores, by the way, instead of 15, a 30% markup, 5% markup, somebody wants to buy it for a 5% profit, I'll take the profit and I'll add something else, and I just do that over and over and over, and I just replace them all, because once you are experienced enough to judge their quality, their amount of risk involved in different types of securities. You get comfortable with this. I call it a selection universe.
Lesley Logan 13:10
Yeah.
Steve Selengut 13:11
Comfortable to the extent that it doesn't matter which one you use, which product you put back on your shelf.
Lesley Logan 13:17
Yeah. And I like the visualization of it, because I think, and you know, you guys, it's okay to hit pause, look something up, you know, and come back to this, because it can be overwhelming. But also, if we think about a department store or a shopping center, no one actually goes to a shopping center that has five shoe departments. They want a shopping center that has, oh, it's got the shoe department, it's got the pro, I'm going there because I can get the grocery, I can get groceries, I can get gas, I can get these things, and so more people are attracted to that. It can do really well, because, in case you don't need shoes, you're still going to the shopping center. There's still going to be something doing well. Am I describing your analogy correctly?
Steve Selengut 13:50
Yeah, yeah. And what is the biggest thing that brings you to a shopping center or an individual store? What brings you there?
Lesley Logan 13:59
Something you need or.
Steve Selengut 14:00
Yeah, but, sale. The sale.
Lesley Logan 14:04
The sale. Yes.
Steve Selengut 14:05
There's another part of this analogy, when prices are down their bargains, the same stock market. When the price of Microsoft goes down as short a time as that thing's been in business, unlike Exxon or some of the other healthcare companies, every time it's gone down in price, it's always been an opportunity to buy it and then to be able to sell it. Most people don't sell.
Lesley Logan 14:30
Yeah. We can get into that. So you mentioned risk, and I think, like one of the things that makes it difficult for some people, some listeners, to kind of get involved in their portfolios more is like the idea that you don't know enough to know what you're doing.
Steve Selengut 14:48
Right.
Lesley Logan 14:48
And also to kind of learn, you said, you should get experience with the risk of it, the experience could cost you money. And I think some of us, going back to certainty, were like, ah, I have this money, though. So I would just rather hold on to this than "lose" because if we go off of what you've said, if we actually stick with what is known is that the longer you're in there, it always ends up up guys. So it's almost feels like you're learning on your own dime, and you can lose a lot of money. And I think people get scared.
Steve Selengut 15:17
That's the way. That's true of most people's entry into the marketplace, and when they get started, and that's a lot of what eventually leads them to a financial advisor to help them with that, especially when the size of their investment gets bigger, and it's scarier if you were to lose it, like, you know, oh my God, as you get older, how am I going to rebuild if I get these losses. In the book that I wrote after I sold my business, it's called Retirement Money Secrets, it spends a lot of time on six principles of investing, and four of them are risk minimization tools. When you're looking at a security, it doesn't matter if it's one of those regular stocks in the New York Stock Exchange or on any of the markets. You're looking at any security, you want to judge its quality. You want to come up with a way of determining what its quality is. And what I look at is things like, how long it's been in business. Is it profitable? Does it pay me a dividend as an owner? I mean, the chief executives getting $12 million a year. If I'm not getting the dividend, that doesn't seem right to me. I'm an owner.
Lesley Logan 16:30
Yeah.
Steve Selengut 16:30
I'm paying his salary, theoretically.
Lesley Logan 16:33
Yeah.
Steve Selengut 16:33
So that type of thing. So there are things you can look at to determine the quality. How long it's been in business is a big one. Then the next one is diversification. When I set up a portfolio, even if AI is crazy hot right now, you don't want a portfolio that's all in AI. I mean, Buggy Whips used to be the biggest thing, you know, years ago. So, you know, you just, so you have to diversify. Yeah, I have AI, but I also have everything else. So diversification is a second way to minimize your risk. The third way is to make sure everything you own pays you income. There's two reasons for that. First, you deserve it, and secondly, it's a clear way of knowing if there's something wrong with the company. No corporation wants to cut their dividend, that's why they're so reluctant to start paying dividends in the first place. But what if something happens? They have to cut it. It's a sure sign that they're in trouble. So that's why we want to have something that pays a dividend, because we want to know when they get in trouble. And if they cut their dividend, they can't keep it from us. And it's the same with bonds and things like that. They have to pay that regular interest every six months, and if they don't, everybody's going to sue them and they're going to be gone. So income is a very important thing for that and for the fact that you then have the wherewithal to take advantage of opportunities in the market, because you have income coming in, many people make the mistake of automatically reinvesting their income into the same securities. It's a big mistake, because then they don't have that luxury of having money that they can put back into Microsoft when it goes down, or put back into Exxon when it goes down, that type of thing, or pay a bill, buy Christmas presents, whatever. Those are the big three. And then the fourth one, and this is where most people fail miserably. It's a function of emotions. They fall in love with securities that go up in price. They just totally fall in love. They get convinced, I'm just going to keep adding to this one and adding to this, always goes up. It's wonderful. It's so green on my whole portfolio looks beautiful because this one security, or these three securities, are up so much. But then they go down. Then you have a COVID, then you have a dotcom bubble. Were you?
Lesley Logan 19:05
Oh, I was around. I wasn't investing. I was alive. But I do remember, I do remember the year where the Super Bowl commercials were all dotcom commercials, and they were terrible. They were awful. And then when they and then they collapsed, and everyone was pissed, yes.
Steve Selengut 19:21
Well, I remember the first Super Bowls when Green Bay was, the very first ones.
Lesley Logan 19:27
Oh, the very first Super Bowls. There was no ad.
Steve Selengut 19:29
My first, my first market correction, big one, was the crash of '87th. You know, it's interesting about the crash of '87 because it wasn't AI and it wasn't high-tech, but it was the first time when they started using computers in the stock exchanges. In the very, very old days, you never had a day where, where a million shares were traded in one day. The Dow was, I don't even know, was at 1000 back in '87 you know? But what happened was they started to put in these programs where people could trade on like a signal would come off, you know, this one went down that triggers a cell. And to me, I was pretty certain little I knew about automation, but it was just a computer loop, because if you you say, okay, you're going to sell, it goes to this level, and everybody sells. And then the mob hears about it, and they start to sell. It goes to the next level, the next level, next level.
Lesley Logan 20:29
Right.
Steve Selengut 20:30
And it was across the board. Everything was down. It wasn't just tech, it wasn't just this everything.
Lesley Logan 20:36
It was just that, you know how the birds, like, they take off, they all fly together. It's kind of like everyone kind of goes, oh shoot. I must, everyone freaks out the same time, because somebody like.
Steve Selengut 20:46
Everybody freaks out the same time. And that's how the stock market, everybody does freak out at the same time.
Lesley Logan 20:51
Well, that's how the depression was. Everyone went to the banks to take somebody out at the same time.
Steve Selengut 20:56
Run on the bank, right? Yeah, those days there was no protection.
Lesley Logan 21:00
Yes.
Steve Selengut 21:00
You didn't have all those controls and protections that we have now in our bank accounts and our.
Lesley Logan 21:06
I just listened to an episode about Sam Bankman-Fried of how did he do what he did? And like, people lost their life savings. And whenever I hear of them, I'm like, you put all of your life savings in one thing? Like, not that you're deserving. No one is deserving of that. But also, I'm just like you put your life savings in one thing? And what's interesting is, whoever took over, they've actually been able to replenish and pay people back, which I think is amazing that they're very lucky. But I love that you brought up these different risk minimizers, because it does mean, like, things can go up and things can go down, and you're gonna be okay. But there's a part of my brain, and that is like the listener in here, going, how much time does this take every day? Because, how much time do I have? Because if I have a job and I've got, like, if someone wants to be it until they see it and be in charge of all these things, how much time do they need to spend on looking at their portfolios, or do you suggest they don't?
Steve Selengut 22:01
Oh yeah, no, absolutely. If you're going to run your own portfolio, you better be there to, you can, well, there's two ways of looking at it. There's two streams of income that you can have in investments. The one is the regular distributions, bonds, stocks, whatever pay. And you get that on a regular basis, and maybe once a month, you see how much your cash position is, and you decide what to reinvest it in. So you can be pretty passive with it. And that's one stream of income. And right now in closed-end funds, I mean, even in those that are invested in the stock market, this is what I'm talking about, the spreadsheet with all these things on it. There's 100 of them that I look at and that I own that are yielding over 99% and they've all been tested for, like, quality diversification income, and I do the profit-taking myself. But if you could have a diverse portfolio like this made up of diverse portfolios themselves, you can be very passive, if you choose to. And you know, the income is going to come in at 9% and let's say you've got a million dollars. So that's what 90 grand a year you're going to make. Is that going to be enough for you? You make that decision, you know? So if it is, yeah, you can be as passive as you want to be, but then you have somebody like me who hasn't quite seen all of the world yet, and I'm determined that, while I can still walk, I'm going to see the world, the whole world. So I need more than just that base income is what I call as base income. Yeah, I need more than that, and I know how to get that, because I'm looking, I know how the market works, but I don't know when things are going to happen, because nobody does, but it's a cyclical beast, right? I mean, if you think back and you look at a chart, you can see that it goes up and down and up?
Lesley Logan 24:01
Yeah.
Steve Selengut 24:02
Highs and lows are not predictable, but you can tell if you're at a higher level or at a lower level, right? You can just look where you are. So depending on where you are, how I do my decision making, I buy less of things if the market is high, I buy more of them if the market is low.
Lesley Logan 24:22
Got it.
Steve Selengut 24:22
I'm looking to sell more when the market is high. I'm looking to buy more when the market, so all those things go into my thinking.
Lesley Logan 24:30
I like that you pointed out based on what you want to make from your investments, can determine the level of your participation in it?
Steve Selengut 24:42
Yes, exactly. So with me, I want I set these targets on my profits, just like my store, if it's just looking at the income, you're more like a bank with a very high level of earnings on the savings in the bank. You got this diversified portfolio spitting out all this income. You you don't need to do much except reinvest it selectively. But I want more than that. So what I want to do is I'm going to look at my prices, and if I have somebody comes into the store and I get my 5% markup, or even a 2% you know, when prices are down, I'll take it, and that builds up my capital every time I make a couple bucks. That way I can also reinvest it, add new securities, add to existing securities, and increase my level of income.
Lesley Logan 25:34
Yeah.
Steve Selengut 25:34
So for example, like right now, when you have an account statement like a fidelity or Schwab, they give you every month they tell you your estimated income for the next 12 months is this, so I know how much mine is for the next 12 months, but I also know that so far as of today, I've made nearly five months additional income by trading the securities in my account. So that tells me, Sandie, if you want to go to Japan next year, yeah, no problem.
Lesley Logan 26:08
Yeah. I know, Sandie is your partner. And also, have you seen you can go on a two-year long around the world cruise? I already looked. It has internet, so you could totally do what you're doing. You can see the whole world. My husband and I did the math, because I was like, well, how much does this, I heard the price, which can sound like a lot, but I was like, well, just divide it by.
Steve Selengut 26:28
200,000 something like that.
Lesley Logan 26:30
Yeah, yeah. So then you divide it by like, 24 months, or whatever it is, and you're like, it wasn't much more than my mortgage.
Steve Selengut 26:37
It's a whole lot cheaper than doing it the way I have, by individual trips. You know, a week in Southeast Asia, two weeks in Australia and in separate times. You know, when you're going here, if we added up all that we'd spent, going to all these places we better be a whole lot more than that.
Lesley Logan 26:53
I know. I told them. I said, okay, I don't know if we'll ever not have dogs, because I don't know if I could leave my pet for two years. But if we ever got to a place where we had no pets, even if I've seen the place already, what a cool way to spend two years of your life. I hope you do that. I guess my next question for you is just, if someone's feeling overwhelmed, they're with you. They're like, okay, this guy, Steve, he gets it. I understand most of the words he's saying. I'm sure most people don't realize that they're like, stocks could just like income-produce for them on top of what they're already doing, where do they start? How do we take the overwhelm off?
Steve Selengut 27:26
Okay. Well, you know how they say there's an app for that?
Lesley Logan 27:30
Yes.
Steve Selengut 27:30
There's a book for that.
Lesley Logan 27:31
Okay.
Steve Selengut 27:32
And that's why I wrote the book. It's a conversation between, really, my wife and I and this couple we meet on one of our trips in Amsterdam, and they've come into this trip by selling a chunk of their assets to fund the trip and we've come into it by paying a couple months income to do it. And we talked about how we got from A to B, and how they can get from where they are to where we are without really changing anything, because most people have the same securities in their model portfolios or their funds, or whatever they have in their 401(k)s, and these closed in funds that I have that deal in equities pretty much own the same things. It's just the focus of the managers of the fund are in line with my interest. My interests are income production. So I have these guys, hundreds of them, working directly for me, right? Because they're running these portfolios and they're giving me income, and then I am selling their poor souls every now and then for profits, but, you know, I buy them right back again soon, not immediately, but eventually. So that's the thing. You got to educate yourself. Like you said, in this country, most people come out of high school, they can't even balance a checkbook. They come out of college, and they don't have a clue unless they're majors, right? But there are certainly many books that you can read. I know the textbooks that I read in college, and I did take business courses, so yeah, I knew a little bit. You can learn about what stocks and bonds are. I mean, some of the people that are listening to you and I talk today don't know the difference between one and the other, or what they mean, what you know they're and that's unfortunate. You got to know that. You really need to know that before you can say to somebody, I'm going to trust you to manage my money. You don't know what he's doing. You've got to know and you've got to give him some direction. You've got to tell him, I'm not particularly concerned if you buy a stock that goes up and makes me a lot of money, unless you actually capitalize on that, because when it goes down, you don't look so smart anymore, you know?
Lesley Logan 29:49
Yeah, I find it fascinating the idea of doing it myself, and also like I'm not in that place of my life where I'm there yet. So I've educated myself to a place where I ask questions of my person and they have to know them. And. I've been really impressed with this person I've worked with recently because no stuttering, definitely had it, got me the information, did better than the things that I asked. And the more I educate myself, the more questions I have. So every meeting we have, and he'll meet with me as much as I want, I'm like, okay, I have more questions that you're still securing your job, because I'm learning more. And so until I am able to do it myself, and that day will come, I just have a lot going on my own business, and I want to make sure that something is happening. But it is true, we have to educate ourselves, and we can't be scared of it. And I love that your book is like a conversation, because I think that that takes the overwhelm off. I read The Psychology of Money a couple years ago, and that was really helpful information from that guy, because he was just like, hey, the type of person you have to be to make a lot of money is not so good at keeping it. And he explained that. I was like, oh, that's very fascinating information. You know?
Steve Selengut 30:55
Interesting. That's interesting. The education, the learning what you do, the amount of time you spend again will depend on back to where we were. How much money you really want to make. If you could be happy with this amount of money. Fine. Otherwise, you have to do other things. You have to take charge and trade those things to make really significant. And I mean, really significant.
Lesley Logan 31:16
Yeah, I'm really excited for what you're doing, your book and stuff like that, because I do think that people need to hear what's possible. I also worry about people who are just relying on their 401(k) or their IRA. I think it's nice and it's important, but also it might not be enough, especially because we're living longer, thankfully, we're living longer and hopefully healthy. But that doesn't always mean so. Things happen all the time. There are disasters that are outside of your control, and so I do kind of worry about people. So I think educating people like you do, having you on it, is really important, because being it until you see it, you could have all these dreams of being this amazing boss who owns this awesome company, but at the same time, there's money behind everything comes back to that money. It's the energy that fuels things, and so having an understanding of how it works and different ways you can work it, I think it's so cool. I've never heard of something. I've never heard of it. I've never dove deep on the idea of the income producing, like getting those dividends, and using that as a measuring stick in that way. I mean, it's obvious once you said it, but it's not something I thought abou because I just thought, well, I want to be aggressive. I want the money to grow. I want these things. But also, like, how cool that you coach on that income-producing investment.
Steve Selengut 32:32
What would you say your income is in your portfolio?
Lesley Logan 32:36
Right now? (inaudible) What's it produced in the last month? Or what's it valued at right now?
Steve Selengut 32:43
No, no. Market value doesn't matter.
Lesley Logan 32:45
Okay, then I don't know that answer today. I have a meeting next week.
Steve Selengut 32:48
Right. Most people don't ask that, and most people who have advisory people, and normally an advisor is getting about 1.5% not him personally, but the company that he works for. So when I used to tell people when I was managing their money, I was telling them that I would make it a point to make more in profits each year than they were paying me in fees. That was the objective as far as that goes. I'm taking care of the fees by making you actual more capital to replace it. I wrote an article recently about vetting an investment advisor.
Lesley Logan 33:29
Cool.
Steve Selengut 33:30
And that was one of the things that I said, you know? Number one is look at his portfolio first and if what he's got you in is not in his personal portfolio, find out why. I mean, your objectives may be different, but if your stuff sounds more speculative than his stuff, you don't want to take advice from somebody who doesn't have as much money as you do.
Lesley Logan 33:52
Yeah.
Steve Selengut 33:52
So the young guy just getting started, he's not the one you want as your financial advisor. And I learned that quick when I started, because I had my first two clients to get started with. I don't think I got another client for six or eight months, you know. So there are things to do when you're with your advisor, and one of the things is, take a look at his portfolio, make him assure you that he will take at least enough profits to pay his fees, and that he will produce at least 4% in income on your portfolio. And why do I say 4% because if you ask for advisors as you approach retirement, the key number is you'll have to use 4% of your market value each year to pay your expenses in retirement, unless you're like you and I, where we're going to make enough money while we're working that it's going to provide more than the amount we were making when we were working.
Lesley Logan 33:52
Yeah, yeah.
Steve Selengut 33:53
That's our objective.
Lesley Logan 33:54
Yeah.
Steve Selengut 33:54
But normally, people are going to spend about 4% of their market value. So since you're telling me that that's what's going to happen, I want you to make me at least 4% so that means you're going to make me 4% plus one and a half percent every year in income. You can grow the portfolio with the rest of the portfolio all you want, but that's the income I want you to start producing now.
Lesley Logan 35:22
I like this, okay, that article you wrote, I would love to link to it, or you can, you know, put it behind a lead magnet. I think it's such a cool way for people to be armed with that because they don't have that information.
Steve Selengut 35:34
It's on LinkedIn.
Lesley Logan 35:35
It's on LinkedIn.
Steve Selengut 35:36
It's on my profile or my articles.
Lesley Logan 35:38
Okay, cool, cool.
Steve Selengut 35:39
It's the last article I wrote.
Lesley Logan 35:41
We will link to your LinkedIn for sure. We're going to take a brief break, and then we're going to find out where people can find you, follow you, work with you and your Be It Action Items.
Lesley Logan 35:49
All right, Steve, where do you hang out? LinkedIn, sounds like and you said you advise people or you coach them. How can people connect with you?
Steve Selengut 35:56
Theincomecoach.net I have two Facebook groups. One is called The Retirement Income Independence Coach and the other one is called Closed End Funds for Retirement Income and Equity Trading.
Steve Selengut 36:05
Cool. You are busy for someone who is retired.
Steve Selengut 36:14
Yeah, right. I get that a lot. I'm busier now schedule-wise than I was when I was managing money, because that was a, you know, couple hours in the morning, couple hours in the evening. Now it's all day long, with podcasts, writing a book, coaching, meetings and so on.
Lesley Logan 36:33
And speaking of your book, Retirement Money Secrets, where can people order that? Can they get it wherever books are sold? Can they get it at your website? Where should they (inaudible)?
Steve Selengut 36:33
Wherever books are sold, they can get it. The audiobook is only available on Amazon. All the other forms can be gotten anywhere.
Lesley Logan 36:39
Yeah, well, you guys, it's money. You should probably read it instead of listen to it, because you want to be able to highlight, research, all that stuff. Amazing. Okay, you've given us a ton of amazing stuff already. But for the person who is ready to take some action, bold, executable, intrinsic, targeted steps people can take to be it till they see it. What do you have for us?
Steve Selengut 37:06
Bold execution things is the one that I just asked you to do. Take a look at your portfolios and look at the actual income production, where it says dividends received this year or amount you can expect to receive this year with the portfolio just as it is, and see what that is as a percentage of your portfolio. And then the second action thing is, either yourself or your advisor approach them and say, I want that number to be about between four and 5%.
Lesley Logan 37:06
I love it. I'm gonna take you up on that before I even do this recap, because I have a meeting with my advisor. So already scheduled. It's to go over, it's to go over my rest of my year. And am I supposed to be spending a little bit of money? Am I supposed to be investing in a certain way? How can I make that tax write off a little bit different? So I got a big meeting. I'm going to add this to it. I know that, especially for those of you who are over 40, you've got a lot going on. It can be just really overwhelming. But honestly, the more you educate yourself, the more these terms and words don't seem so crazy. And you can start with where you're at. And if you're going to start with an advisor, you can read Steve's article on how to vet them, and you can demand that they do that. And you know what? That's kind of why they have a job. So they can certainly rise to the occasion if they can't go find someone else. Until you want to be like Steven, do it yourself, which is impressive and amazing. Thank you so much. Until next time everyone, Be It Till You See It.
Lesley Logan 38:43
That's all I got for this episode of the Be It Till You See It Podcast. One thing that would help both myself and future listeners is for you to rate the show and leave a review and follow or subscribe for free wherever you listen to your podcast. Also, make sure to introduce yourself over at the Be It Pod on Instagram. I would love to know more about you. Share this episode with whoever you think needs to hear it. Help us and others Be It Till You See It. Have an awesome day. Be It Till You See It is a production of The Bloom Podcast Network. If you want to leave us a message or a question that we might read on another episode, you can text us at +1-310-905-5534 or send a DM on Instagram @BeItPod.
Brad Crowell 39:26
It's written, filmed, and recorded by your host, Lesley Logan, and me, Brad Crowell.
Lesley Logan 39:31
It is transcribed, produced and edited by the epic team at Disenyo.co.
Brad Crowell 39:35
Our theme music is by Ali at Apex Production Music and our branding by designer and artist, Gianfranco Cioffi.
Lesley Logan 39:42
Special thanks to Melissa Solomon for creating our visuals.
Brad Crowell 39:45
Also to Angelina Herico for adding all of our content to our website. And finally to Meridith Root for keeping us all on point and on time.
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