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Speaker 1: Tonight, what in the world is Anthropic and more importantly,

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Speaker 1: why does the market care? You're listening to Simply Money,

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Speaker 1: presented by all Worth Financial on Bob Sponsorller along with

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Speaker 1: Brian James. You may have heard the name a lot

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Speaker 1: lately if you follow financial media at all. The company

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Speaker 1: called Anthropic. It's not a public company, you can't buy

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Speaker 1: the stock, and yet markets are reacting to what they're

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Speaker 1: doing pretty much every day. So what is it, why

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Speaker 1: does Wall Street care? And how is it different from

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Speaker 1: other AI companies? And more importantly, what should you actually

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Speaker 1: be doing about it within your portfolio. Let's get into this, Brian,

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Speaker 1: because this is a good discussion I think on just

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Speaker 1: the status of AI and where it's headed and what

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Speaker 1: we need to be thinking about here looking into the future.

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Speaker 2: So Anthropic this is another AI tool, but it's a

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Speaker 2: little bit different this time. Thropic is an artificial intelligence

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Speaker 2: company founded by former open AI researchers. Those are the

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Speaker 2: folks behind chatchpt, which was not the only but the

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Speaker 2: first one that kind of started all this a few

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Speaker 2: years ago. Well, they all left to build what they

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Speaker 2: describe as a safer, more controllable AI system. So for

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Speaker 2: I think there's a lot of people are aware, but

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Speaker 2: there are some concerns out there that AI could become

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Speaker 2: a little too independent and start doing things that maybe

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Speaker 2: it wasn't intended to do, and so they wanted to

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Speaker 2: design a tool that could be controlled and remove some

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Speaker 2: of those risks. And this is called claud that's their

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Speaker 2: flagship AI model. You might have seen advertisements for it

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Speaker 2: during the Super Bowl and starting to see.

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Speaker 3: Commercials and ads online a lot of places too.

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Speaker 2: Really a direct competitor to chat GPT, but they're not identical.

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Speaker 2: Here's the key difference. As I mentioned, you know, and

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Speaker 2: Thropic has positioned itself around safety, alignment.

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Speaker 3: With human goals and controllability.

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Speaker 2: They're hyper focused on making sure advanced AI systems again

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Speaker 2: behave predictably don't go off the rails. Now, ironically this

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Speaker 2: is this is one of the things that just hit

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Speaker 2: the headlines the other day because our Secretary of Defense

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Speaker 2: or or whatever we're calling in this week would very

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Speaker 2: much like them to remove these guardrails so that they can.

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Speaker 3: Use the tool for the military in just different manners.

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Speaker 2: But anyway, that's how big of a that's how much

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Speaker 2: attention it's gotten that positioning has attracted a lot of money.

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Speaker 2: Amazon is involved with billions of dollars. Google is involved

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Speaker 2: as well.

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Speaker 3: Who's who of.

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Speaker 2: Venture capital firms are there as well. It's currently privately held,

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Speaker 2: but it really is in the middle of all of this,

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Speaker 2: and that's why markets are interested because this is again

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Speaker 2: a tool that could drive profit margin for many other

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Speaker 2: industries as well.

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Speaker 1: Yeah, and I think this is a good time to

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Speaker 1: point out, just to reiterate, you know, there's layers to

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Speaker 1: this whole AI story. You've got the infrastructure companies, the

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Speaker 1: companies like Navidia, the other chip makers, data centers. Then

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Speaker 1: you've got the platform companies like Microsoft, Google and Amazon.

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Speaker 1: And then you have these model developers like we're talking

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Speaker 1: about right now, Open Ai, Anthropic and others. And as

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Speaker 1: you said, you know they're trying Anthropic is trying to

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Speaker 1: differentiate itself by putting more training models into this thing too.

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Speaker 1: And I think I think it makes sense, Brian, because

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Speaker 1: as companies and the government, anybody that's that's that's trying

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Speaker 1: to use the these AI tools, and let's face it,

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Speaker 1: everybody is going there because it's going to be a

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Speaker 1: tremendous productivity gainer here. I think people are worried about

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Speaker 1: systemic risk in their companies. Meaning if you just let

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Speaker 1: these models go, you know, half cocked, and everybody's out

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Speaker 1: there using them, there's no guarantee that what employees are

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Speaker 1: finding when they do searches in these AI models is

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Speaker 1: going to be one hundred percent correct. And then if

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Speaker 1: people just take that information that spits out and runs

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Speaker 1: with it, well, that opens up companies to litigation and

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Speaker 1: legal problems that they want to avoid. So it's just

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Speaker 1: it's just a you know, broadly expected evolution here in

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Speaker 1: how these models are built out, because it all comes

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Speaker 1: down to what the models are doing. Are the quote

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Speaker 1: unquote facts being spit out accurate, accurately, and to make

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Speaker 1: sure people can actually use this as a reliable source

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Speaker 1: of information and make the work environment more productive. It's

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Speaker 1: going to be an ongoing discussion and development and very

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Speaker 1: interesting to watch here as the months and years tick by.

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Speaker 2: So yeah, and I think the buzzwords you're going to

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Speaker 2: be hearing about Claude and these types of tools versus

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Speaker 2: the first wave of chat GPT type tools is constitutional AI.

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Speaker 2: So this is an alignment methodology and it was developed

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Speaker 2: by Anthropic but it's geared toward it. It basically has

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Speaker 2: to follow a constitution. It's like a country does so

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Speaker 2: for instead of relying only on human beings who teach

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Speaker 2: it whatever they want it to think, what it will

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Speaker 2: do is it has to follow rules. Again, this is

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Speaker 2: really just if we read through these, it's really just

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Speaker 2: like any set of laws a country might set up,

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Speaker 2: so things like avoid harm, respecting human autonomy, provide accurate information,

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Speaker 2: refusing assistance and wrongdoing, and being transparent about uncertainty. So

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Speaker 2: all this sounds great constitutional AI that we can build

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Speaker 2: AI tools based off of this, But at the same time,

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Speaker 2: the pessimist in me remembers the time when Google came

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Speaker 2: out with their original slogan of do No Evil and

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Speaker 2: then that eventually just kind of sort of disappeared, maybe

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Speaker 2: a decade or ago. So at the end of the day,

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Speaker 2: whether they stick to these rules is a different story.

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Speaker 2: But at the moment, the advantage that or the interest

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Speaker 2: that is being generated in anthropic comes from this idea

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Speaker 2: that the whole tool is built off of this kind

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Speaker 2: of constitution that is there to protect the human aspect.

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Speaker 2: This is different from the human feedback processes that chat

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Speaker 2: Gypt follows, So human feedback means that human annotators are

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Speaker 2: ranking the outputs and they are the ones designing what

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Speaker 2: the tools think. In the chat Gypt world, there's oftentimes

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Speaker 2: a reward model that is somehow trained from those rankings,

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Speaker 2: so you can guide it to do whatever you want

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Speaker 2: to do. That's why we hear these We constantly hear

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Speaker 2: these hallucinations that come out of the various AI tools,

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Speaker 2: And sometimes Groc will come out and say things against

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Speaker 2: Elon Musk because somebody has trained it to attack him.

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Speaker 2: So but anyway, the base model is fine tuned to

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Speaker 2: maximize these rewards. That's the human feedback version of it

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Speaker 2: versus something that has a set of laws that it

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Speaker 2: has to government. All this stuff is pretty up in

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Speaker 2: the clouds type of things. But the point of this

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Speaker 2: is Claude and Anthropic are out there on more on

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Speaker 2: the cutting edge of addressing directly some of the primary

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Speaker 2: major concerns that exist right now around AI.

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Speaker 1: Well in the recent news, I mean, in fact, just

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Speaker 1: yesterday there were new updates posted to this Claude cowork

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Speaker 1: you know AI system that allows companies to integrate that

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Speaker 1: productivity tool into a host of various enterprise apps such

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Speaker 1: as Saleforce, Salesforce owns slack into it, which does our

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Speaker 1: tax returns DocuSign Brian that we use all the time

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Speaker 1: here at all Worth Legal Zoom fact set, and you've

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Speaker 1: already mentioned Google's Gmail. Dave Hatter, our tech expert, has

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Speaker 1: been warning us up and down about what Google is

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Speaker 1: now able to do and it could get a little

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Speaker 1: bit scary. So yeah, this stuff is now filtering into

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Speaker 1: these enterprise applications and it'll be real interesting to see,

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Speaker 1: you know, how the markets react because you know, this

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Speaker 1: is still a huge capital expenditure story. I mean, Amazon

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Speaker 1: is investing billions into anthropic Google. They've invested billions, and

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Speaker 1: when those big companies do that, that tells the market

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Speaker 1: something important. These hyper scalers believe AI infrastructure and model

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Speaker 1: development are going to be absolutely core to their future

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Speaker 1: revenue stream, and that's what's impacting the markets right now.

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Speaker 1: And we've seen a pullback in some of these big

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Speaker 1: cap tech stocks because you know, the valuations just got

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Speaker 1: a little bit ahead of themselves here as we've seen

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Speaker 1: with fourth quarter earning season, and you know, people are

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Speaker 1: gonna put their money where it's treated best, and we've

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Speaker 1: seen a broadening out of the market you know, we've

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Speaker 1: talked about how international stocks have done well, emerging markets

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Speaker 1: stocks have done well. People are gonna shift money where

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Speaker 1: they can get good growth at a reasonable price, and

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Speaker 1: that's why the market has started to broaden out here.

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Speaker 1: It's just gonna be interesting to watch because just like

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Speaker 1: when the Internet came out, everybody got stoked about the

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Speaker 1: Internet infrastructure stuff, and there were winners and losers, but

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Speaker 1: all the winners at the end of the day were

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Speaker 1: companies that were able to integrate the Internet and the

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Speaker 1: use of the Internet as a productivity tool for their company.

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Speaker 1: And Brian, I think that's what we're gonna see over

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Speaker 1: the next two three five years as companies either have

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Speaker 1: to adopt this new technology some way that hopefully is

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Speaker 1: accurate and helpful for their business and doesn't expose them

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Speaker 1: to undo risk, or they're going to get left behind.

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Speaker 2: So why are we talking about this today, Well, of

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Speaker 2: course it's a headline and it does drive the markets

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Speaker 2: that this is. Of course, the topic of AI has

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Speaker 2: been the hot topic for the last couple of years,

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Speaker 2: and we've got another branch of it here with anthropics.

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Speaker 3: Tools that they've rolled out. But what we shouldn't do

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Speaker 3: is chase it. You can't buy Anthropic anyway. It won't

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Speaker 3: be the only one out there doing this. There will

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Speaker 3: be copycats along the way.

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Speaker 2: Anthropic again is a excuse me, private backed of the

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Speaker 2: venture capital backed company right now.

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Speaker 3: By the time a.

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Speaker 2: Lot of these private opportunities reach individuals that the risk

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Speaker 2: return profile, the upsidle of oftentimes has been already sucked

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Speaker 2: out because the early stage capital gets involved.

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Speaker 3: So don't really think about this as something you should

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Speaker 3: go chase and understand the exposure.

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Speaker 2: More importantly, if you already have a broad S and

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Speaker 2: P five hundred index fund, as most those people do,

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Speaker 2: or something that looks like it, you already have a

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Speaker 2: lot of significant AI exposure.

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Speaker 3: A matter of fact, I'll go ahead and there you

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Speaker 3: might have too much, right exactly.

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Speaker 2: Yeah, it's going to be impossible to avoid it. So

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Speaker 2: don't overthink this. If you own tech heavy funds. Again,

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Speaker 2: the S and P itself is tech heavy because that's

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Speaker 2: just where all the growth has been over the last

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Speaker 2: thirty years. But if you own a specific technology fund

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Speaker 2: that has done well, really well these last couple of years,

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Speaker 2: well you can almost garan darn tee that it is

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Speaker 2: chock full of AI companies like Nvidio and all the

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Speaker 2: supporting players there too. So you just might want to

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Speaker 2: make sure you do one of those X ray type

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Speaker 2: analyzes where if you've got ten different mutual funds out

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Speaker 2: there and five of them are all invested in the

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Speaker 2: same things, then you may not be as diversified as

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Speaker 2: you think you are. So you probably want to take

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Speaker 2: a look at not only the high level description of

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Speaker 2: the fund, more importantly, what are the holdings underneath it,

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Speaker 2: and when you smush it all together in one portfolio,

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Speaker 2: what does it actually look like.

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Speaker 3: How exposed are you in these areas?

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Speaker 1: Yeah, Brian, one way to stress test this, I'd be

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Speaker 1: interested in your thoughts is, you know, you take some

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Speaker 1: of these funds or ets that are highly allocated allocated

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Speaker 1: toward these tech growth names, and go look back do

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Speaker 1: a stress test of how it performed back during the

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Speaker 1: tech bubble, you know, the early two thousands. I'm not

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Speaker 1: calling for an eighty percent decline in the NASDAC, but

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Speaker 1: I think people that want to understand how a significant

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Speaker 1: downturn in the in the market might impact their current

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Speaker 1: portfolio maybe go back and stress test how some of

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Speaker 1: these growth funds did during a significant market decline because

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Speaker 1: we really haven't had one of those to speak of

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Speaker 1: since the two thousand and eight you know, housing crisis,

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Speaker 1: And sometimes people get lulled to sleep a little bit

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Speaker 1: and don't understand how much potential volatility is sitting there,

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Speaker 1: you know, just festering in their portfolio.

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Speaker 2: Yeah, I guess my thought on that, to add to

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Speaker 2: that a little bit would be, it's gonna it's gonna

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Speaker 2: be a little tough to stress test purely the way

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Speaker 2: the way you might be thinking, because these companies didn't

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Speaker 2: exist or didn't exist in their current format and video

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Speaker 2: was a video game a video card manufacturer twenty twenty

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Speaker 2: five years ago, So it's not gonna you can't really

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Speaker 2: look at that directly and say this is how AI

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Speaker 2: reacted twenty five years ago because it didn't exist. What

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Speaker 2: you can do is figure out what the bubble of

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Speaker 2: the time was and what did the valuations get to. Right,

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Speaker 2: So how far ahead was it on PE ratios or

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Speaker 2: other ratios if.

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Speaker 3: These are not profitable companies.

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Speaker 1: Really, that was really the point I was making is

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Speaker 1: valuations got severely out of whack in some of these

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Speaker 1: companies and sectors. And so, yeah, different technology, but similar.

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Speaker 2: Story bubbles or bubbles, the herds dampedes in and it's

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Speaker 2: dampedes out. So learn that kind of history and will

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Speaker 2: go a long way to helping you what to expect

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Speaker 2: with AI.

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Speaker 1: Absolutely, here's the all Worth advice. When innovation excites the market,

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Speaker 1: don't chase the story. Evaluate your exposure because, after all,

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Speaker 1: participation does build wealth, but over concentration can potentially put

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Speaker 1: your wealth at risk coming out next y. Saving for

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Speaker 1: healthcare costs in retirement might not be enough. The most

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Speaker 1: important step people need to take when we come back.

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Speaker 1: You're listening to Simply Money presented by all Worth Financial

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Speaker 1: on fifty five KRC, the talk station. You're listening to

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Speaker 1: Simply Money presented by all Worth Financial. I'm Bob Sponsller

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Speaker 1: along with Brian James. Hey, if you can't listen to

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Speaker 1: Simply Money every night, subscribe and get our daily podcast.

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Speaker 1: Just search Simply Money on the iHeart app or wherever

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Speaker 1: you find your podcast is sitting on cash costing you

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Speaker 1: long term growth? Is the AI boom just a big bubble?

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Speaker 1: And what if you're stuck with big capital gains in

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Speaker 1: your portfolio and staring down retirement in just three years?

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Speaker 1: We're going to tackle hopefully all of that and more

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Speaker 1: straight ahead. It's six forty three. Now to a concerning

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Speaker 1: statistic as it relates to healthcare costs, one in five

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Speaker 1: Americans say they have not considered at all the cost

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Speaker 1: of health care during their retirement, according to Fidelity Investments'

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Speaker 1: latest Retireing Healthcare Cost Estimate, Brian, this is an important

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Speaker 1: part of everyone's financial plan, so it's worth talking about here.

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Speaker 3: So this is a number that we talk about frequently.

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Speaker 2: Matter of fact, every time we review a financial plan

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Speaker 2: with somebody, we want to talk about the cost of

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Speaker 2: health care. So the reason we're talking about this is

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Speaker 2: because of this Fidelity study. You don't want to be

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Speaker 2: the one in five that Fidelity reports among sixty five

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Speaker 2: year olds who can expect about one hundred and seventy

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Speaker 2: two thousand dollars in healthcare medical expenses in retirement.

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Speaker 3: So anyway, make sure that you're on top of what

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Speaker 3: that's going to look like for you.

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Speaker 2: So this is kind of new information, it's reconfirming stuff

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Speaker 2: that we've heard for a long time now, and the

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Speaker 2: ways to tackle this haven't really changed. This is something

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Speaker 2: you want to get onto, you know, pretty quickly.

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Speaker 1: Here.

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Speaker 3: So the way we want to tackle this is, first

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Speaker 3: of all, separate out your health care from your other expenses.

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Speaker 3: Don't just lump it into your life living expenses.

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Speaker 2: Healthcare expenses, those costs will go up more rapidly as

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Speaker 2: they have historically, than the cost of a loaf of

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Speaker 2: bread and a gallon of gas and so on and

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Speaker 2: so forth. So carve that out as a separate expense

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Speaker 2: from your living expenses. Not only does it go up faster,

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Speaker 2: but over time it's going to become more of a

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Speaker 2: part of your budget than it is right now. Right

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Speaker 2: we are all as healthy as we are ever going

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Speaker 2: to be as we're sitting here right now. So once

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Speaker 2: you've got it separated out, go a little further. Within

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Speaker 2: that healthcare expense item, you're going to want to look

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Speaker 2: at three different buckets. First of all, premiums for the

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Speaker 2: insurance are going to have to pay Medicare based premiums,

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Speaker 2: probably a supplemental policy as most people will pick up.

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Speaker 2: Some people run different types of plans. If you've got

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Speaker 2: federal benefits, good on you. You're probably less of a

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Speaker 2: concern here. But there's other people out there on state

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Speaker 2: plans and sometimes employer plans.

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Speaker 3: Understand what those premiums look like and how they grow

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Speaker 3: over time.

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Speaker 2: The second bucket within the healthcare expense is what's my

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Speaker 2: out of pocket and ongoing medical expenses or what are

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Speaker 2: those going to be for procedures I might need or

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Speaker 2: equipment and so forth. The third is probably the scare

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Speaker 2: the the least understood, and that's long term care that

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Speaker 2: is a totally separate expense that that some people may

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Speaker 2: have to take on. And you know, the average cost

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Speaker 2: in this area for an individual is going to be

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Speaker 2: somewhere maybe the three twenty five or three hundred and

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Speaker 2: fifty thousand dollars range by itself for the remaining the

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Speaker 2: average two and a half to three years stay that

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Speaker 2: happens at the end of life when it comes to

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Speaker 2: long term care that is not covered by Medicare beyond

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Speaker 2: the first thirty days, and it's something you want to

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Speaker 2: think about a little bit differently.

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Speaker 1: I think you covered well the financial aspects of all this,

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Speaker 1: and I think, as you you know, correctly pointed out,

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Speaker 1: you've got to model this stuff out. And just like

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Speaker 1: you would evaluate investment risk or volatility or inflation volatility,

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Speaker 1: you've got to consider health care costs volatility as part

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Speaker 1: of your financial plan. I want to call out one

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Speaker 1: other thing that I think is just as important as

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Speaker 1: the numbers and the money, is planning ahead for cognitive decline,

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Speaker 1: not just the cost. And Brian, I am seeing this

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Speaker 1: come up up more and more often with you know,

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Speaker 1: some of my clients that I've worked with for over

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Speaker 1: thirty years, they're aging, they're aging well, but they're getting old.

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Speaker 1: And I'll just put it out there this way. I

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Speaker 1: think we all have to ask ourselves if if cognitive decline,

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Speaker 1: you know, Alzheimer's, dementia, a stroke, anything like that happened today,

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Speaker 1: what would happen to your financial affairs, who's managing it,

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Speaker 1: who's educated about it? Who can pick up the reins

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Speaker 1: and carry it? Because, Brian, in most families and couples

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Speaker 1: that we see, one of the spouses, be it the

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Speaker 1: male or the female, is the money person it's running things,

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Speaker 1: really loves doing the spreadsheets, the tax planning, the investment allocation,

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Speaker 1: all of that. And if that person is no longer

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Speaker 1: able to do that, if they have not communicated what

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Speaker 1: the next step actually looks like, Brian, I'm seeing, you know,

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Speaker 1: a lot of interruption and stress can come to a

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Speaker 1: family very quickly. This is something not enough people plan

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Speaker 1: for and talk about, but we need to be doing.

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Speaker 1: That is part of our health care planning for sure.

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Speaker 2: And and I think I think it's also valuable to

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Speaker 2: take a look at your own your own family history.

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Speaker 2: You know, is Alzheimer's, Parkinson's, Huntington's, or those those kinds

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Speaker 2: of things present in your family line, your bloodline, they

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Speaker 2: may be getting passed down to you. Not much you

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Speaker 2: can do to stop that, of course, unfortunately, but what

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Speaker 2: you can do to protect yourself and your family from

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Speaker 2: it is while you were in the healthiest state you'll

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Speaker 2: ever be again, we're all, you know, we're all as

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Speaker 2: healthy as we're going to be right now. Lay out

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Speaker 2: those documents as Bob mentions, lay out the what's gonna happen?

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Speaker 2: Who's in charge if I can no longer make decisions

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Speaker 2: for myself? First of all, who determines that right with

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Speaker 2: which among my family and my doctors is going to

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Speaker 2: decide that I am no longer able to make these

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Speaker 2: decisions myself? And then who steps in This is both

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Speaker 2: related to healthcare and financial type decisions. You're gonna want

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Speaker 2: to update those trusts and make sure that there that

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Speaker 2: they're they do what you want them to do, and

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Speaker 2: that the appropriate people can take over at the appropriate time.

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Speaker 3: Simplify as well.

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Speaker 2: Right, if you've got accounts all over the place for

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Speaker 2: frier jobs and investments and just different things you've done,

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Speaker 2: then maybe you're not really paying as much attention to.

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Speaker 3: And that's natural, right. Cognitive ability aside.

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Speaker 2: People get to a point where we just spend less

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Speaker 2: time dealing with these types of things and accounts get

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Speaker 2: scattered all over the place. That's one of the things

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Speaker 2: that we do during retirement planning is starting to consolidate

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Speaker 2: that but make it easier for those people who are

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Speaker 2: going to be making decisions for you by getting those

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Speaker 2: all in one place.

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Speaker 1: Excellent point. Here's the all Worth advice. Don't just say

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Speaker 1: for health care in retirement, structure your entire comprehensive financial

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Speaker 1: plan for it. Coming up next, an eighty two year

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Speaker 1: old grandmother just lost two hundred thousand dollars to an

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Speaker 1: AI deep fake scam. If you have aging parents or

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Speaker 1: vulnerable family members, would they be able to spot something

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Speaker 1: like this ahead of time? We're going to talk about

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Speaker 1: that next. You're listening to simply money presented by all

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Speaker 1: Worth Financial on fifty five KRC. The talk station you're

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Speaker 1: listening to Simply Money, presented by all Worth Financial. I'm

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Speaker 1: Bob Sponseller along with Brian James, joined tonight by our

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Speaker 1: good friend Dave Hatter, who covers all things tech related

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Speaker 1: and scam related. And Dave, unfortunately you've got another just

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Speaker 1: horrible scam to talk about tonight, involving an eighty two

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Speaker 1: year old that lost over two hundred thousand dollars in

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Speaker 1: their retirement savings in some kind of an AI deep

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Speaker 1: fake doctor scam. Tell us about this and what can

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Speaker 1: we learn from it and how can we help folks

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Speaker 1: avoid this kind of situation, you know, with their own

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Speaker 1: retirement assets.

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Speaker 4: Yeah, guys, as always, thanks for having me on. And

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Speaker 4: this is a terrible story and it's really illustrative of

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Speaker 4: where we're at with all this AI stuff. I know,

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Speaker 4: people don't believe these kinds of scams are real. This

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Speaker 4: has been fairly widely reported on and it's not the

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Speaker 4: only scam of its kind. And I guess you know,

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Speaker 4: first off, the key to all of this stuff, in

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Speaker 4: my opinion, is awareness. There is nothing you can do

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Speaker 4: short of living in a bunker out in the woods

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Speaker 4: somewhere completely off the grid to avoid this stuff, right,

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Speaker 4: and the bad guys know this. I would bet every

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Speaker 4: one of your listeners has gotten multiple data breach notices. Hey,

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Speaker 4: your data has been leaked from the company X, probably

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Speaker 4: some company you never heard of. Hey, I've got to

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Speaker 4: bring that up. Is yeah, I bet both of you

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Speaker 4: have gotten several. I bet Joe's gotten several. I mean

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Speaker 4: I've gotten several. And you know I'm the tenfoil hat guy.

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Speaker 4: Because it's impossible to completely it's impossible to live in

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Speaker 4: today's digital world without your data being sold from one

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Speaker 4: company to another and then eventually lost. And the reason

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Speaker 4: why that's important is it gives the scammers a leg up.

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Speaker 4: What people don't really understand in many cases is these

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Speaker 4: scammers are usually not technical wizards. They're con artists that

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Speaker 4: are using this technology and the plentiful information that is

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Speaker 4: available about you in many cases to craft very authentic

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Speaker 4: seeming scams. Messages could be texts, could be video, could

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Speaker 4: be audio, phone, call email, whatever. You know, they'll come

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Speaker 4: at you wherever people are in video games and chat apps.

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Speaker 4: So my point is you've got all this information about

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Speaker 4: you out there that makes it easy for someone to

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Speaker 4: scam you. You've got all these different mechanisms to reach you,

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Speaker 4: and now you throw AI into the mix where you

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Speaker 4: can create incredibly realistic videos. I don't know if you

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Speaker 4: guys have seen that. It cut a lot of a

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Speaker 4: press lately. The deep fake video of Brad Pitt or

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Speaker 4: Tom Cruise and Brad Pitt fighting each other. It's very

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Speaker 4: realistic looking. And my point is, as this technology advances,

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Speaker 4: the ability to create audio and video that is extremely

437
00:22:42,640 --> 00:22:46,480
Speaker 4: realistic is there. It's there today. It costs nothing to use.

438
00:22:46,720 --> 00:22:49,840
Speaker 4: Any criminal can use it. And people will often tell me, well,

439
00:22:49,960 --> 00:22:51,560
Speaker 4: you know, I got a call that appeared to be

440
00:22:51,640 --> 00:22:53,840
Speaker 4: from my son in jail needing money. It's called the

441
00:22:53,880 --> 00:22:58,200
Speaker 4: grandparents scam. How you know, how could they clone his voice? Well, okay,

442
00:22:58,359 --> 00:23:02,600
Speaker 4: even if you were spat boss son whatever is not

443
00:23:02,760 --> 00:23:05,639
Speaker 4: on social media. If they have a voicegum mail greeting,

444
00:23:05,800 --> 00:23:08,800
Speaker 4: I can call your voicemail, I can record your voice

445
00:23:08,800 --> 00:23:11,639
Speaker 4: off the voicemail and in about fifteen minutes, using a

446
00:23:11,680 --> 00:23:13,960
Speaker 4: free tool, I can clone your voice. I have actually

447
00:23:14,040 --> 00:23:16,880
Speaker 4: demonstrated this with a reporter out of Columbus. We recorded

448
00:23:16,960 --> 00:23:20,840
Speaker 4: his voice from his voicemail and did an interview where

449
00:23:20,880 --> 00:23:22,760
Speaker 4: you can watch me type and his voice comes out

450
00:23:22,800 --> 00:23:25,280
Speaker 4: of the speakers. This stuff is all real, folks. So

451
00:23:25,400 --> 00:23:28,600
Speaker 4: to get back to this story at hand, this woman, apparently,

452
00:23:28,800 --> 00:23:30,680
Speaker 4: and again you know, the bad guys will go on

453
00:23:30,800 --> 00:23:34,800
Speaker 4: social media, they'll create fake profiles, they'll post of you know,

454
00:23:35,280 --> 00:23:39,480
Speaker 4: make a million dollars a year in crypto, save your taxes. Whatever,

455
00:23:39,760 --> 00:23:42,359
Speaker 4: they'll come up with, whatever messaging, they'll post it on

456
00:23:42,480 --> 00:23:46,560
Speaker 4: social media. Apparently, this woman followed some doctor I've never

457
00:23:46,640 --> 00:23:52,120
Speaker 4: heard of, doctor Corey whoever that is apparently was popular

458
00:23:52,200 --> 00:23:56,600
Speaker 4: during the pandemic, and she, you know, was a follower

459
00:23:56,640 --> 00:24:00,119
Speaker 4: of this person. This person, which was obviously some to

460
00:24:00,160 --> 00:24:03,880
Speaker 4: think profile, was talking about cryptocurrency and how they could

461
00:24:03,880 --> 00:24:06,280
Speaker 4: make money and so forth. So again, this is a

462
00:24:06,400 --> 00:24:09,800
Speaker 4: typical con artist scam they're using, but they're using social

463
00:24:09,880 --> 00:24:13,680
Speaker 4: media to reach people. They're impersonating people that you know,

464
00:24:13,880 --> 00:24:17,960
Speaker 4: have influence out there. Can't believe anything you see online.

465
00:24:18,160 --> 00:24:22,800
Speaker 4: And so then she gets sucked into this, this this

466
00:24:23,480 --> 00:24:26,159
Speaker 4: idea that she's going to make money in crypto with

467
00:24:26,320 --> 00:24:28,840
Speaker 4: advice from this doctor who apparently is a medical doctor.

468
00:24:28,920 --> 00:24:31,760
Speaker 4: So why he would necessarily know about this, I don't know.

469
00:24:32,359 --> 00:24:35,800
Speaker 4: But according to the article. She was a retired teacher

470
00:24:35,840 --> 00:24:38,399
Speaker 4: watched a video on Facebook which appeared to show doctor

471
00:24:38,480 --> 00:24:41,040
Speaker 4: Corey saying if he had access to her information, he

472
00:24:41,080 --> 00:24:43,439
Speaker 4: would put it into a special fund that would increase

473
00:24:43,480 --> 00:24:44,000
Speaker 4: in value.

474
00:24:44,600 --> 00:24:47,080
Speaker 1: Okay, so she goes down this rabbit hole.

475
00:24:47,600 --> 00:24:50,199
Speaker 4: She watches AI videos of this guy, and this is a.

476
00:24:50,240 --> 00:24:51,119
Speaker 1: Direct quote from her.

477
00:24:51,560 --> 00:24:53,720
Speaker 4: And I have so much respect for this woman going

478
00:24:53,800 --> 00:24:55,920
Speaker 4: public with his story, because it's one thing to have

479
00:24:56,040 --> 00:24:58,240
Speaker 4: a guy like me come on your show and talk

480
00:24:58,280 --> 00:25:00,720
Speaker 4: about this stuff. It's another thing to have a victim

481
00:25:00,760 --> 00:25:04,600
Speaker 4: who actually lost almost two hundred thousand dollars say this

482
00:25:04,880 --> 00:25:07,040
Speaker 4: actually happened to me, right, I think it carries a

483
00:25:07,080 --> 00:25:09,720
Speaker 4: lot more weight and hopefully is more believable to people.

484
00:25:09,840 --> 00:25:13,800
Speaker 4: So she, you know, got on the Facebook and started

485
00:25:13,840 --> 00:25:16,760
Speaker 4: having a conversation with someone using AI to impersonate this

486
00:25:16,920 --> 00:25:20,240
Speaker 4: doctor Corey. She says, quote, I really respected doctor Corey

487
00:25:20,320 --> 00:25:22,560
Speaker 4: for a long time, and it apparently was a'n ai,

488
00:25:22,640 --> 00:25:25,040
Speaker 4: which I don't understand that much about, but it was

489
00:25:25,160 --> 00:25:27,240
Speaker 4: him talking and he was recommending a way to increase

490
00:25:27,280 --> 00:25:31,840
Speaker 4: my money using crypto unquote. So you know, eventually she

491
00:25:32,000 --> 00:25:34,360
Speaker 4: gave him the money, and of course the money disappeared.

492
00:25:34,440 --> 00:25:35,800
Speaker 4: She goes on to say there was a video of

493
00:25:35,880 --> 00:25:38,200
Speaker 4: him talking. It was obviously AI, and I don't know

494
00:25:38,280 --> 00:25:39,920
Speaker 4: how that works, but I believed it and I fell

495
00:25:40,040 --> 00:25:41,960
Speaker 4: for it, and I have nobody to blame but myself.

496
00:25:42,560 --> 00:25:45,879
Speaker 4: So again, I mean, huge kudos to this woman for

497
00:25:46,000 --> 00:25:49,159
Speaker 4: going public with his story to make other people aware

498
00:25:49,200 --> 00:25:50,000
Speaker 4: that this is real.

499
00:25:50,200 --> 00:25:50,800
Speaker 1: It's happening.

500
00:25:51,359 --> 00:25:55,440
Speaker 4: And you know, unfortunately, guys, as this deep is, this

501
00:25:55,600 --> 00:25:59,960
Speaker 4: AI technology increases its capabilities to create things that seem incredible.

502
00:26:00,160 --> 00:26:04,439
Speaker 4: Realistic awareness is key, skepticism is key, and you got

503
00:26:04,520 --> 00:26:06,159
Speaker 4: to do what we nerds like to call go out

504
00:26:06,240 --> 00:26:07,080
Speaker 4: of band, right you.

505
00:26:07,160 --> 00:26:09,680
Speaker 2: Can't they, you know, I think the scariest part about

506
00:26:09,720 --> 00:26:12,359
Speaker 2: all this is the scalability that now exists. Right, So,

507
00:26:13,359 --> 00:26:17,000
Speaker 2: up until recently, it's been it's been human beings dialing

508
00:26:17,119 --> 00:26:19,959
Speaker 2: phones and talking people into these things. Now it can

509
00:26:20,000 --> 00:26:22,040
Speaker 2: simply be computers doing this, so they don't even need

510
00:26:22,119 --> 00:26:24,439
Speaker 2: to find slaves anymore to get it done. And then

511
00:26:24,640 --> 00:26:27,320
Speaker 2: that is almost infinitely scalable. So this is just gonna

512
00:26:27,320 --> 00:26:28,520
Speaker 2: get worse and worse and worse, isn't it.

513
00:26:29,720 --> 00:26:30,520
Speaker 1: It really is?

514
00:26:30,760 --> 00:26:32,800
Speaker 4: And I mean, even if the human being gets involved,

515
00:26:32,840 --> 00:26:35,600
Speaker 4: it might be after the computers find their mark, right,

516
00:26:35,800 --> 00:26:39,600
Speaker 4: they you, they post stuff on Facebook, ex, Twitter or whatever,

517
00:26:40,400 --> 00:26:43,680
Speaker 4: and then robodie once you yeah, once you bite on that,

518
00:26:44,000 --> 00:26:46,840
Speaker 4: right or yeah, they just wore dial phone numbers until

519
00:26:46,920 --> 00:26:50,160
Speaker 4: someone answers. Once you bite, then a human con artist

520
00:26:50,200 --> 00:26:54,200
Speaker 4: gets involved, using information they've gotten about you, using these

521
00:26:54,320 --> 00:26:58,600
Speaker 4: tools to pretend to be again your boss, your spouse,

522
00:26:58,880 --> 00:27:03,320
Speaker 4: your son, respected person in the community that's encouraging you

523
00:27:03,480 --> 00:27:06,800
Speaker 4: to do something you know. Here here's another quick tip, guys,

524
00:27:07,240 --> 00:27:11,800
Speaker 4: never ever, ever put money in a crypto ATM as

525
00:27:11,880 --> 00:27:14,080
Speaker 4: part of some sort of bank thing where like, oh,

526
00:27:14,119 --> 00:27:17,760
Speaker 4: your your account has been hacked, take your money out

527
00:27:17,760 --> 00:27:19,240
Speaker 4: of the account and go put it in this ATM

528
00:27:19,320 --> 00:27:22,119
Speaker 4: to protect it. Anyone that's asking you to do anything

529
00:27:22,240 --> 00:27:26,119
Speaker 4: like that ninety nine point nine repeating chance it's a scam.

530
00:27:26,720 --> 00:27:30,000
Speaker 4: Stop go out of band all your bank using a

531
00:27:30,119 --> 00:27:32,919
Speaker 4: number you know. And if you have been defrauded by

532
00:27:33,000 --> 00:27:36,719
Speaker 4: something like this, you must act immediately. Okay, You've got

533
00:27:36,800 --> 00:27:40,560
Speaker 4: to contact your bank immediately. You should contact your insurance company,

534
00:27:40,640 --> 00:27:43,119
Speaker 4: your attorney if you have one. You know, the sooner

535
00:27:43,200 --> 00:27:46,080
Speaker 4: you act, the better likelihood you might be able to

536
00:27:46,119 --> 00:27:48,280
Speaker 4: claw back some of all of the money. If you

537
00:27:48,440 --> 00:27:52,560
Speaker 4: don't discover that you've been scammed for a month, two months, whatever,

538
00:27:52,720 --> 00:27:54,200
Speaker 4: you're never going to get that money there.

539
00:27:54,800 --> 00:27:56,440
Speaker 1: All right, Dave, We're gonna have to leave it there

540
00:27:56,560 --> 00:27:59,639
Speaker 1: for tonight. Thanks as always for joining us. We'll certainly

541
00:27:59,680 --> 00:28:02,399
Speaker 1: have you back on to dive deeper into this topic

542
00:28:02,440 --> 00:28:04,320
Speaker 1: because this is going to keep coming up more and more.

543
00:28:04,440 --> 00:28:07,240
Speaker 1: Thanks again for joining us tonight, Dave. You're listening to

544
00:28:07,320 --> 00:28:10,840
Speaker 1: Simply Money, presented by all Worth Financial on fifty five KRC,

545
00:28:11,240 --> 00:28:20,119
Speaker 1: the talk station. You're listening to Simply Money presented by

546
00:28:20,160 --> 00:28:23,399
Speaker 1: all Worth Financial on Bob's Fun Seller along with Brian James.

547
00:28:23,840 --> 00:28:25,879
Speaker 1: If you have a financial question you'd like for us

548
00:28:25,960 --> 00:28:28,200
Speaker 1: to answer, there's a red button you could click while

549
00:28:28,200 --> 00:28:30,520
Speaker 1: you're listening to the show. If you're listening on the

550
00:28:30,600 --> 00:28:34,160
Speaker 1: Ikehart app, simply record your question and it will come

551
00:28:34,280 --> 00:28:38,040
Speaker 1: straight to us, all right. Brian chris In Lovelin leads

552
00:28:38,120 --> 00:28:40,240
Speaker 1: us off tonight. He says, we've built up about a

553
00:28:40,320 --> 00:28:43,840
Speaker 1: two million dollar portfolio, but almost all of it is

554
00:28:43,920 --> 00:28:47,240
Speaker 1: in retirement accounts. I think he means pre tax are

555
00:28:47,320 --> 00:28:50,680
Speaker 1: we boxed in when it comes to flexibilities prior to

556
00:28:50,800 --> 00:28:52,040
Speaker 1: when rmds start.

557
00:28:53,040 --> 00:28:54,880
Speaker 3: So he answered my first big question, which is how

558
00:28:54,960 --> 00:28:55,320
Speaker 3: old are you?

559
00:28:55,440 --> 00:28:56,920
Speaker 2: And now I know that you're at least less than

560
00:28:57,160 --> 00:28:59,440
Speaker 2: seventy three seventy five, So it sounds like there's a

561
00:28:59,440 --> 00:29:01,600
Speaker 2: little bit left in that window before r md start,

562
00:29:01,640 --> 00:29:03,640
Speaker 2: which is why you're thinking about this. Yeah, you're in

563
00:29:03,720 --> 00:29:05,760
Speaker 2: a situation that a lot of people find themselves in

564
00:29:05,840 --> 00:29:08,360
Speaker 2: when when you work for a company, you have a

565
00:29:08,360 --> 00:29:09,920
Speaker 2: four oh one K four or three B or what

566
00:29:10,040 --> 00:29:12,200
Speaker 2: have you. Uh, and you've been doing it for decades

567
00:29:12,200 --> 00:29:14,600
Speaker 2: and yeah, most likely you've built up a significant pile

568
00:29:14,800 --> 00:29:17,640
Speaker 2: of pre tax dollars, which has been wonderful because you

569
00:29:17,760 --> 00:29:20,560
Speaker 2: avoided the worst tax that we have, which is the

570
00:29:20,720 --> 00:29:23,160
Speaker 2: ordinary income tax, because it's marginal. The more you make,

571
00:29:23,200 --> 00:29:25,400
Speaker 2: the more you have to pay. But at the same time,

572
00:29:25,480 --> 00:29:27,400
Speaker 2: that happens on the back end too, so you've dodged

573
00:29:27,440 --> 00:29:30,160
Speaker 2: those taxes. But r mds are just when the when

574
00:29:30,240 --> 00:29:31,800
Speaker 2: when it's time to pay the piper, the I r

575
00:29:31,880 --> 00:29:34,000
Speaker 2: S comes calling for their for their pound of flesh.

576
00:29:34,080 --> 00:29:37,080
Speaker 2: So uh, but you're not necessarily boxed in. It's all

577
00:29:37,080 --> 00:29:41,200
Speaker 2: about timing and control. And so so what happens is

578
00:29:41,240 --> 00:29:42,600
Speaker 2: once you're fifty nine and a half, you have a

579
00:29:42,640 --> 00:29:45,160
Speaker 2: lot more flexibility you can withdraw from those iras.

580
00:29:45,240 --> 00:29:47,440
Speaker 3: So there's if you are in a situation now.

581
00:29:48,320 --> 00:29:50,720
Speaker 2: Chris, where you are, you have bills to pay, of course,

582
00:29:50,760 --> 00:29:52,720
Speaker 2: and you need you need assets with which to do it,

583
00:29:53,040 --> 00:29:55,160
Speaker 2: and maybe you're not working anymore, or maybe your spouse

584
00:29:55,280 --> 00:29:57,360
Speaker 2: is retired and there's just less income in the house. Well,

585
00:29:57,360 --> 00:29:59,840
Speaker 2: you're probably in a lower bracket than you've been in,

586
00:30:00,320 --> 00:30:03,120
Speaker 2: so it can be okay to rely on those assets

587
00:30:03,160 --> 00:30:05,160
Speaker 2: to just play and pay the bills, take some money out,

588
00:30:05,240 --> 00:30:07,280
Speaker 2: pay some taxes, understand what the tax hit will be,

589
00:30:08,200 --> 00:30:10,840
Speaker 2: and get those bills paid with it, because that money's

590
00:30:10,840 --> 00:30:12,880
Speaker 2: got to come from somewhere Anyhow. I think what we're

591
00:30:12,920 --> 00:30:16,400
Speaker 2: really talking about, though, is really Wroth conversions might be

592
00:30:16,480 --> 00:30:19,000
Speaker 2: the biggest way if you really want to take advantage

593
00:30:19,040 --> 00:30:21,160
Speaker 2: of this window where you've got the lowest tax bracket

594
00:30:21,240 --> 00:30:24,200
Speaker 2: you'll ever see, because they're going up at our md age.

595
00:30:24,200 --> 00:30:26,120
Speaker 2: Of course, when you have to start taking this money out,

596
00:30:26,360 --> 00:30:29,360
Speaker 2: you can do roth conversions of a calculated amount. And

597
00:30:29,440 --> 00:30:30,920
Speaker 2: maybe you want to figure out what what does it

598
00:30:30,960 --> 00:30:32,880
Speaker 2: take to get you to the top of the twenty

599
00:30:32,920 --> 00:30:35,320
Speaker 2: two percent bracket or the twenty four percent bracket you're

600
00:30:35,320 --> 00:30:38,240
Speaker 2: already some partial way into the bracket based off of

601
00:30:38,320 --> 00:30:38,880
Speaker 2: current income.

602
00:30:39,160 --> 00:30:41,080
Speaker 3: Fill the rest of it up with Wroth conversions.

603
00:30:41,400 --> 00:30:43,880
Speaker 2: Yes, you'll be paying income taxes on those dollars, but

604
00:30:44,040 --> 00:30:46,320
Speaker 2: more importantly, you'll never will again, and you'll have from

605
00:30:46,400 --> 00:30:49,000
Speaker 2: now until our MD age for it to grow completely

606
00:30:49,080 --> 00:30:52,120
Speaker 2: tax free, and then you can celebrate and watch it continue.

607
00:30:51,800 --> 00:30:54,440
Speaker 3: To grow tax free well past that age.

608
00:30:54,720 --> 00:30:57,520
Speaker 2: So the downside of all this, if you are on

609
00:30:57,640 --> 00:31:01,000
Speaker 2: Medicare paying Medicare premiums, you may see some impact to IRMA,

610
00:31:01,040 --> 00:31:03,440
Speaker 2: which means your Medicare premiums may go up. A lot

611
00:31:03,440 --> 00:31:05,400
Speaker 2: of people want to avoid that, like the plague. But

612
00:31:05,520 --> 00:31:09,000
Speaker 2: remember IRMA is only an annual adjustment, So if you

613
00:31:09,080 --> 00:31:11,720
Speaker 2: make major Roth conversions for the next two or three years,

614
00:31:12,120 --> 00:31:16,360
Speaker 2: then the what will happen is your IRMA premiums will

615
00:31:16,400 --> 00:31:18,640
Speaker 2: be calculated two years later. So in other words, if

616
00:31:18,680 --> 00:31:20,520
Speaker 2: you do this for three years, then the last time

617
00:31:20,560 --> 00:31:23,000
Speaker 2: you'll have to deal with it is five years from now.

618
00:31:23,280 --> 00:31:26,080
Speaker 2: When your IRMA premiums are based off of that final year,

619
00:31:26,280 --> 00:31:28,440
Speaker 2: then it goes back to whatever your actual income.

620
00:31:28,240 --> 00:31:29,520
Speaker 3: Is, So just don't be surprised by that.

621
00:31:29,640 --> 00:31:31,160
Speaker 2: But the fact, to me, the fact that you're going

622
00:31:31,240 --> 00:31:33,520
Speaker 2: to be raising your Medicare premiums for a little bit

623
00:31:33,640 --> 00:31:35,959
Speaker 2: is not a deal killer. Roth conversions are still very

624
00:31:36,040 --> 00:31:39,200
Speaker 2: valuable when you look at the possible compounding and reduction

625
00:31:39,320 --> 00:31:41,520
Speaker 2: in rmds for the remainder of your entire life. So

626
00:31:41,880 --> 00:31:45,200
Speaker 2: I hope that helps Chris, Tom and Anderson. Tom says

627
00:31:45,200 --> 00:31:48,200
Speaker 2: they're sitting on a big pile of cash. Everything feels expensive.

628
00:31:48,360 --> 00:31:50,160
Speaker 2: So how do you know when you're being smart versus

629
00:31:50,280 --> 00:31:52,239
Speaker 2: just sitting on the sidelines too long? Sounds like you're

630
00:31:52,240 --> 00:31:54,800
Speaker 2: thinking about investing, Bob, Yeah.

631
00:31:54,680 --> 00:31:57,200
Speaker 1: And Tom. You know, obviously I don't know all the

632
00:31:57,280 --> 00:32:01,080
Speaker 1: components of your portfolio or your financial plan, so you know,

633
00:32:01,120 --> 00:32:03,640
Speaker 1: I got to speak broadly here, which I will attempt

634
00:32:03,680 --> 00:32:06,520
Speaker 1: to do in my attempt to help you. But you know,

635
00:32:06,840 --> 00:32:10,000
Speaker 1: it's rarely a good idea, whether we feel like things

636
00:32:10,040 --> 00:32:14,000
Speaker 1: are expensive or we feel like things are inexpensive, to

637
00:32:14,320 --> 00:32:17,480
Speaker 1: build a financial plan based on feelings, because most of

638
00:32:17,560 --> 00:32:20,880
Speaker 1: the time we're wrong. So here's what I think the

639
00:32:21,200 --> 00:32:24,160
Speaker 1: best way to approach this is is separate your money

640
00:32:24,760 --> 00:32:27,080
Speaker 1: into the money that you're going to need or want

641
00:32:27,200 --> 00:32:30,000
Speaker 1: to spend within the next one to three or even

642
00:32:30,160 --> 00:32:33,560
Speaker 1: four years and have that money kind of out of

643
00:32:33,640 --> 00:32:38,320
Speaker 1: harm's way from a market volatility standpoint, into more secure,

644
00:32:39,640 --> 00:32:44,440
Speaker 1: conservative type assets things bonds, cash, money market accounts, cash equivalents,

645
00:32:44,800 --> 00:32:47,920
Speaker 1: so you can ride out any short term volatility that

646
00:32:48,080 --> 00:32:51,080
Speaker 1: might come down the pike and then commit that longer

647
00:32:51,200 --> 00:32:54,480
Speaker 1: term capital with a five, ten, fifteen year time horizon

648
00:32:54,680 --> 00:32:58,760
Speaker 1: to growth, recognizing that, yes, there's going to be volatility

649
00:32:58,840 --> 00:33:01,520
Speaker 1: along the way. But if you know ahead of time

650
00:33:02,080 --> 00:33:04,720
Speaker 1: your financial plan is not going to require you to

651
00:33:04,960 --> 00:33:08,520
Speaker 1: touch those dollars that are subject to short term volatility,

652
00:33:08,880 --> 00:33:12,240
Speaker 1: you can weather the storm and come out ahead over

653
00:33:12,320 --> 00:33:15,960
Speaker 1: the longer term. It's sometimes hard to do emotionally, but

654
00:33:16,080 --> 00:33:18,920
Speaker 1: I find that people that are willing to separate their

655
00:33:19,040 --> 00:33:22,040
Speaker 1: buckets of money based on what that money needs to

656
00:33:22,160 --> 00:33:24,880
Speaker 1: do for them and when can walk away with a

657
00:33:24,920 --> 00:33:28,640
Speaker 1: bit more peace of mind and over time a larger portfolio.

658
00:33:29,040 --> 00:33:31,600
Speaker 1: Hope that helps. We got time for maybe one more.

659
00:33:32,480 --> 00:33:36,480
Speaker 1: Brian ron and Covington says, I'd convince this whole AI

660
00:33:36,600 --> 00:33:39,960
Speaker 1: boom is just another bubble waiting to burst. If I

661
00:33:40,000 --> 00:33:43,480
Speaker 1: think it's gonna unwind, should I be reducing exposure now,

662
00:33:44,360 --> 00:33:48,000
Speaker 1: even if it means trimming these broad index funds that

663
00:33:48,080 --> 00:33:49,440
Speaker 1: we talk about all the time. Brian.

664
00:33:50,480 --> 00:33:52,320
Speaker 3: Yeah, and it's a real fair question, of course.

665
00:33:52,400 --> 00:33:55,000
Speaker 2: And we've addressed this a couple times today, and I

666
00:33:55,040 --> 00:33:57,360
Speaker 2: suspect we're gonna probably address it tomorrow too, because it's

667
00:33:57,400 --> 00:34:00,320
Speaker 2: the topic dujor it seems like. But if you think

668
00:34:00,360 --> 00:34:03,520
Speaker 2: about going back through history, every major technological shift has

669
00:34:03,560 --> 00:34:07,280
Speaker 2: attracted bubble type pricing in the stock market, railroads in

670
00:34:07,320 --> 00:34:10,040
Speaker 2: the eighteen hundreds, radio in the twenties, the very first

671
00:34:10,080 --> 00:34:13,440
Speaker 2: Internet bubble in the late nineties. Every time valuations overshot

672
00:34:13,480 --> 00:34:16,200
Speaker 2: reality before the fundamentals caught up. And we get excited

673
00:34:16,239 --> 00:34:19,600
Speaker 2: about companies that don't even have positive earnings, they hemorrhage money. Right,

674
00:34:19,640 --> 00:34:21,920
Speaker 2: that's what's happening in the business right now. We're so

675
00:34:22,040 --> 00:34:24,560
Speaker 2: excited about the potential that we're ignoring the fact that

676
00:34:24,640 --> 00:34:26,480
Speaker 2: most of these companies aren't making any money at all.

677
00:34:26,800 --> 00:34:29,360
Speaker 2: So if you own these broad index funds, though, remember

678
00:34:29,440 --> 00:34:31,439
Speaker 2: you don't own the AI trade, you own the whole market.

679
00:34:31,480 --> 00:34:33,839
Speaker 2: That's the point of broad index fund. Yeah, if it's

680
00:34:33,880 --> 00:34:36,960
Speaker 2: a large cap tech s and P five hundred fund,

681
00:34:36,960 --> 00:34:38,920
Speaker 2: that's going to be heavily overweighted to the large.

682
00:34:38,760 --> 00:34:40,480
Speaker 3: Cap tech side of things.

683
00:34:40,800 --> 00:34:44,919
Speaker 2: So The real issue here though, is structural versus tactical risks,

684
00:34:44,960 --> 00:34:48,320
Speaker 2: So measure your concentration, not the headlines. What's the percentage

685
00:34:48,320 --> 00:34:51,239
Speaker 2: of the total portfolio actually tied to a handful of

686
00:34:51,280 --> 00:34:54,920
Speaker 2: these megacap ai companies. You can do this with online

687
00:34:55,000 --> 00:34:56,960
Speaker 2: tools to look under the hood of the various ticker

688
00:34:57,040 --> 00:34:59,800
Speaker 2: symbols you might own. So get all that information and

689
00:35:00,000 --> 00:35:02,200
Speaker 2: push it all together and see what your overall portfolio

690
00:35:02,280 --> 00:35:04,239
Speaker 2: looks like. Then you can decide whether you really have

691
00:35:04,360 --> 00:35:07,000
Speaker 2: a problem or if you're just maybe reacting to scary headlines.

692
00:35:08,080 --> 00:35:10,160
Speaker 1: All right, coming up next, We talked earlier in the

693
00:35:10,239 --> 00:35:15,800
Speaker 1: show somewhat conceptually about the whole issue of cognitive decline. Brian,

694
00:35:15,920 --> 00:35:18,399
Speaker 1: coming up next, is going to walk us through how

695
00:35:18,440 --> 00:35:22,040
Speaker 1: he's actually managing a client and a family through this

696
00:35:22,320 --> 00:35:25,439
Speaker 1: very sad and challenging time. You're listening to Simply Money

697
00:35:25,480 --> 00:35:28,640
Speaker 1: presented by all Worth Financial on fifty five KRC the

698
00:35:29,000 --> 00:35:35,680
Speaker 1: talk station. At this moment, you're listening to Simply Money

699
00:35:35,760 --> 00:35:38,480
Speaker 1: presented by all Worth Financial on Bob Sponseller along with

700
00:35:38,600 --> 00:35:42,200
Speaker 1: Brian James and tonight, Brian walks us through how he's

701
00:35:42,320 --> 00:35:46,359
Speaker 1: actually helping right now guide a family through a very

702
00:35:46,440 --> 00:35:52,279
Speaker 1: difficult situation involving cognitive impairment. Brian, I know this is

703
00:35:52,400 --> 00:35:54,520
Speaker 1: near and dear to your heart, and you always do

704
00:35:54,640 --> 00:35:57,319
Speaker 1: a great job in situations like this, walk us through

705
00:35:57,400 --> 00:35:58,359
Speaker 1: what's going on right now?

706
00:35:59,000 --> 00:36:01,840
Speaker 2: Yeah, heading a tension getter earlier this week, one of

707
00:36:01,920 --> 00:36:04,120
Speaker 2: these things that makes you makes you stop and take

708
00:36:04,239 --> 00:36:07,000
Speaker 2: take pause and make sure you're appreciating the people that

709
00:36:07,120 --> 00:36:09,040
Speaker 2: are around you when when they can understand it.

710
00:36:09,600 --> 00:36:12,200
Speaker 3: Uh So, on one of my favorite clients, married couple

711
00:36:12,280 --> 00:36:12,480
Speaker 3: came in.

712
00:36:12,640 --> 00:36:15,560
Speaker 2: One of the spouses dropped the bombshell on me, uh

713
00:36:15,760 --> 00:36:20,560
Speaker 2: that he had been diagnosed with early onset Alzheimer's And

714
00:36:21,000 --> 00:36:23,080
Speaker 2: this was news to them as well, but apparently does

715
00:36:23,160 --> 00:36:24,680
Speaker 2: run in the family. That was I didn't know that,

716
00:36:24,800 --> 00:36:27,680
Speaker 2: but apparently they weren't overly shocked by it. It's just unfortunately,

717
00:36:27,680 --> 00:36:30,080
Speaker 2: it's just his turn, and it's really really sad. But

718
00:36:30,239 --> 00:36:33,400
Speaker 2: so we spent that conversation doing fine now, so you know,

719
00:36:33,480 --> 00:36:36,040
Speaker 2: things functioning okay, but obviously that changes the trajectory that

720
00:36:36,080 --> 00:36:38,320
Speaker 2: we're on. And so it just got me thinking a

721
00:36:38,360 --> 00:36:40,600
Speaker 2: lot about what why is this such a bigger concern

722
00:36:40,800 --> 00:36:43,560
Speaker 2: you know nowadays than it was back then. You know,

723
00:36:43,760 --> 00:36:46,280
Speaker 2: so so for a lot of modern history, cognitive decline

724
00:36:46,360 --> 00:36:48,520
Speaker 2: was more of a medical issue, not so much a

725
00:36:48,600 --> 00:36:51,439
Speaker 2: financial issue. Well, now we've come to a time where

726
00:36:51,719 --> 00:36:55,400
Speaker 2: where there's so many are our financial fortunes are so

727
00:36:55,719 --> 00:36:58,960
Speaker 2: tied to our piles of money that we can control,

728
00:36:59,400 --> 00:37:01,759
Speaker 2: not so much streams of income that just show up

729
00:37:01,800 --> 00:37:03,320
Speaker 2: in the mailbox and then we dole them out and

730
00:37:03,360 --> 00:37:05,880
Speaker 2: pay of bills. That means these piles of money we

731
00:37:05,960 --> 00:37:09,400
Speaker 2: have have to be taken care of. This provides greater opportunity. Right,

732
00:37:09,440 --> 00:37:11,279
Speaker 2: I can invest, I can grow, I can do things.

733
00:37:11,360 --> 00:37:13,520
Speaker 2: I can do all kinds of things that I couldn't

734
00:37:13,560 --> 00:37:17,319
Speaker 2: do before. Prior generations were perfectly fined financially but tied

735
00:37:17,360 --> 00:37:20,399
Speaker 2: down with pensions and just social security, those kinds of things,

736
00:37:20,600 --> 00:37:22,799
Speaker 2: not a lot of flexibility. Now we've got a lot

737
00:37:22,880 --> 00:37:26,040
Speaker 2: more flexibility. But with that comes risk and needing to

738
00:37:26,160 --> 00:37:28,880
Speaker 2: make sure that we plan ahead, because there will come

739
00:37:28,920 --> 00:37:30,759
Speaker 2: a time where somebody is choosing.

740
00:37:30,480 --> 00:37:32,560
Speaker 3: Whether to take this risk or that risk, or no

741
00:37:32,719 --> 00:37:33,400
Speaker 3: risk at all.

742
00:37:33,640 --> 00:37:36,960
Speaker 2: And when the cognitive underpinnings that we've been relying on

743
00:37:37,080 --> 00:37:40,160
Speaker 2: no longer work, that's a major risk. So proactive planning.

744
00:37:40,440 --> 00:37:43,480
Speaker 2: How do we deal with this foundational documents, a durable

745
00:37:43,560 --> 00:37:45,520
Speaker 2: financial power of attorney. These are things we're working on

746
00:37:45,640 --> 00:37:49,120
Speaker 2: right now for this couple that's going through this in

747
00:37:49,239 --> 00:37:51,560
Speaker 2: making sure that we know who makes the decisions, who

748
00:37:51,680 --> 00:37:54,160
Speaker 2: takes over, and who decides when it's time to take

749
00:37:54,200 --> 00:37:57,399
Speaker 2: over healthcare powers of attorney. That's important too, living will

750
00:37:57,480 --> 00:37:59,920
Speaker 2: what do I want done in case I can't make

751
00:38:00,040 --> 00:38:04,000
Speaker 2: my own decisions. A revocable trust sometimes can play a

752
00:38:04,040 --> 00:38:06,000
Speaker 2: big role here because that will put in that can

753
00:38:06,080 --> 00:38:08,279
Speaker 2: put a lot of non financial assets that can be

754
00:38:08,360 --> 00:38:12,279
Speaker 2: tougher to control that you can clearly designate who owns it.

755
00:38:12,320 --> 00:38:14,160
Speaker 2: If the trust owns it, that means the trustee is

756
00:38:14,239 --> 00:38:16,560
Speaker 2: making decisions, and then you are the one who will

757
00:38:16,640 --> 00:38:19,160
Speaker 2: decide who you know, that's the way you'll decide who

758
00:38:19,200 --> 00:38:24,040
Speaker 2: decides on those particular assets. Older generations oftentimes assumed the

759
00:38:24,120 --> 00:38:27,760
Speaker 2: family was going to provide care. But today everybody scattered

760
00:38:27,760 --> 00:38:30,279
Speaker 2: across the country and we have dual income households, meaning

761
00:38:30,400 --> 00:38:32,680
Speaker 2: that there's nobody in the household has the time to

762
00:38:32,719 --> 00:38:36,799
Speaker 2: do it, not a real realistic assumption. There long term

763
00:38:36,880 --> 00:38:39,560
Speaker 2: care costs, that's obviously an option, but those can exceed

764
00:38:39,600 --> 00:38:42,360
Speaker 2: one hundred thousand dollars for skilled nursing rising faster than

765
00:38:42,440 --> 00:38:44,960
Speaker 2: general inflation of course, just like any other healthcare expense.

766
00:38:45,239 --> 00:38:47,600
Speaker 3: So the point of all this is to take it,

767
00:38:47,719 --> 00:38:49,520
Speaker 3: take some time and think about what this might mean

768
00:38:49,600 --> 00:38:49,759
Speaker 3: to you.

769
00:38:50,160 --> 00:38:51,839
Speaker 2: I just like I said, I just made made eye

770
00:38:51,880 --> 00:38:53,640
Speaker 2: contact in the same room with a couple who was

771
00:38:53,680 --> 00:38:56,560
Speaker 2: dealing with this today. Wasn't a thing last week, this

772
00:38:56,719 --> 00:38:59,040
Speaker 2: week it is, so think about how it might impact you.

773
00:39:00,239 --> 00:39:02,640
Speaker 1: Thanks for listening to night You've been listening to Simply Money,

774
00:39:02,680 --> 00:39:05,200
Speaker 1: presented by Allworth Financial on fifty five k r C,

775
00:39:05,600 --> 00:39:06,560
Speaker 1: the talk station