Bitcoin ETF: The guest strongly favors Bitcoin ETFs over buying coins on exchanges due to tight spreads, no trading commissions, and low annual fees (~20–25 bps).
Transaction Costs: Direct crypto purchases often face 1%+ all-in costs and wider spreads, making ETFs more efficient for recurring buys and larger allocations.
Custody & Security: Most ETFs use institutional custodians (often Coinbase) with multi-custodian setups and cold storage, reducing hack and self-custody risks.
Key Companies: Discussion referenced BlackRock (BLK), Coinbase (COIN), Grayscale (GBTC), Schwab (SCHW), and Robinhood (HOOD) in the context of ETF issuance, custody, and trading costs.
Crypto & Markets: Bitcoin sometimes correlates with unprofitable tech but is unlikely to cause equity crashes given crypto’s smaller market size; it’s more a risk-sentiment gauge.
Energy Prices: Low gas prices do not necessarily signal a recession; increased U.S. oil supply and efficiency are key drivers, and oil has gone largely sideways over two decades.
Market Outlook: After multiple strong years, a 20–30% pullback wouldn’t be shocking; DCA investors can view such declines as a chance to “time travel” to earlier price levels.
Wealth Planning: High earners with complex holdings should formalize tax, estate, insurance, and investment plans; wealth management firms actively cater to such investors.
Transcript
Welcome to our final Ask the Compound episode of 2025. This is a show where you, the audience, ask the questions and we provide the answers. The US stock market was up 24% last year. This year, it's up nearly 20%. And that's on top of a 26% gain in 2023. So, would it be that surprising if the stock market fell, say, 20% in 2026? What about 30%. What would that mean? What should you do if this happens? How can you prepare? We're going to cover that scenario on today's show and more. Let's do this. Our email here is ask the compound show@gmail.com. Send us in an email if you have a question. Leave us a comment in a live chat. Dave in the comments last week complained that we did not bring it with holiday sweaters. So today we brought it Duncan. We're wearing our holiday best Thunder myth one. That's pretty good. I like it. On today's show, we're answering questions straight from the viewers about should you buy the Bitcoin ETF versus buying it on an exchange? Can crypto cause the stock market to fall? Are low gas prices signaling a recession? How can you prepare for a stock market crash? And then how do you turn the page on a hodgepodge of investments and make it into an actual retirement plan? But first, today's show is brought to you by Rocket Money. Ever feel like your money just disappears every month? It's easier never to overspend, especially around the holidays. You have subscriptions piling up, impulse buys. Rocket Money helps you rein it in by showing you where your money is going, helping you make better decisions so you can keep more money in your pocket. Rocket Money is a personal finance app that helps you find and cancel unwanted subscriptions, monitors your spending, and helps you lower your bills so you can grow your savings. Rocket Money has saved users over $2.5 billion, including over 880 million in cancelled subscriptions alone. I just got my my monthly hit from Rocket Money in my email inbox saying, "Hey, here's all your subscriptions that are going to renew. I can go through and figure out which ones they need to cut, which ones are rising in price. 10 million members at Rocket Money have saved up to $740 a year when they use all the apps premium features. Cancel those unwanted subscriptions and reach your financial goals faster with Rocket Money. Go to rocketmoney.comc today. It's rocketmoney.comc. rocketmoney.comc or just download the app. >> Yeah. Special thanks to them, too. They've sponsored us a lot this year. We appreciate it. >> Yeah. And I it's it's a great app. I use it all the time. and the the email things like if I forget to check they they check in all the time. It's very nice. Um wanted to share a quick success story. We got an email. This is from someone can't remember the name. You've answered a question of mine in the past back in November of 2022. The show was still called Portfolio Rescue. I kind of forgot about that. When I asked about my girlfriend who was a travel nurse and how she could catch up on her retirement savings, an update on her, she went from $30,000 in retirement savings. This is again, this is 2022 to nearly $300,000 now by maximizing all of her contributions and adding to a brokerage account in addition to her IRA and 401k. 10x retirement savings. >> Not bad. >> That is amazing. That that is the kind of thing I like to hear. That's a great not to brag of the week. And that is that's awesome. That is and that's one of those things where I tell people like it's not just because you waited too long and you you're starting late doesn't mean that all is lost. Like you can you can do these things. That's uh that's that's awesome to hear. leverage do you think they used? >> I mean, the timing was good. November 2022 was when Chad GPT hit the market. So, I'm sure she went all in AI in her retirement accounts. Uh, but great work. >> All right, let's >> Can I just Can I share something that uh I got kind of a >> an offensive comment on YouTube. I just want to share real fast. Uh, >> T7W1 said, "Duncan is 38. I listen to the podcast and don't see the gray beard. Duncan, the yolo years are behind you. Time to give up on Oatley and think of your future. Time is running out. Time is running out. >> He called you middle-aged. It's over. >> Yeah, I >> You're brain your beard just like me. That's My kids are always giving me crap about it. All right, let's get to the first question of the day. >> Okay, up first today we got a question from Chuck. Is there any downside to buying a Bitcoin ETF in a brokerage account rather than buying Bitcoin itself on Coinbase? Is there any scenario where the price of the ETF and the coin itself are de somehow? >> Okay, let's bring on an expert for this one. Eric Belchunis from Bloomberg is the pre-minent authority on all things ETFs. Eric, does anyone love ETFs more than you do? >> They can't, right? >> Definitely not. >> Uh, well, >> you're good for the industry. You're you're an ETF proponent. >> So, there's a couple of different angles here with this with this question. The first one, I guess, is cost. So, I I have some personal experience buying and selling Bitcoin directly on like Coinbase or Robin Hood, and I am shocked by the bit ask spreads there. They're still to me insanely high. So, I want you to walk us through the difference in transaction costs of buying an ETF on one on an exchange wherever in your brokerage account versus buying crypto directly on one of these exchanges. I'm curious what the what do you think that looks like? >> I you know, you you're correct. Uh if if you're from the crypto world and you're buying it on Coinbase and it goes up 50% every year, you probably don't notice that you paid like 1.4% to buy it because you're up so much and you don't know any different. But if you come from the Tradfi world and you're used to like free commission free trading and like tight pennywide spreads, it's highway robbery, >> right? The irony, by the way, the whole irony of the crypto industry, it's a it's, I think, under reportported story, is it's all populist, but the intermediaries are living in like 1970s stock broker worlds. >> Yes. >> Yeah. It's a trady, meanwhile, is living in pure hell. Um, people underrate how much these Schwab and Vanguard and BlackRock and um all the brokerages honestly have just been competing. Remember when they all went to commission free and they all like had to copy each other? It is brutal. It's a hellscape. So the Bitcoin ETF, if you buy it on a brokerage account, there's no trading commission. There's probably a 2% of two basis point spread, maybe three, something like that. We'll call it almost nothing. Then you pay like 20 to 25 bips a year in expense ratio. Do >> Wait, do you think those will go down? Those expense ratios cuz they were when they started they were lower than I felt they'd be. I know that there was a a ton of competition. Do you think those will continue to be eaten away as well? >> Maybe. I I think for now they're like at a at a at a place where most people would say they're cheap >> but like if a Schwab were to come out with like a 10 bit um you know maybe that would force the issue but or Vanguard but if some no-name issuer came in at like two bips it wouldn't matter. It would need to be a big issuer coming in about half the cost and I don't really see that happening. So I would just assume you're going to be 20 to 25. By the way, GBTC was 2%. And hedge funds were 2%. So this is a, you know, virtually 8 to 10 times cheaper than what was previously on the market. So you got that that's really your fee is 25 25 bips a year or something like that. And with Coinbase, I tried this, right? So I've been working on a book all year about this. So I was like, "Okay, let me try to get Bitcoin on my own." if the transfer from your bank account and then when you look at the different I actually got this app called Ledger which is a hard wallet and that has a software that allows you to look at all the exchanges to see where what the deals are and honestly I couldn't find anything below 1.5% when I wanted to trade my dollars for Bitcoin and that I believe is inclusive of the spread but also it's almost like it felt to me like when you know when you go to airport in a foreign country and like there's the currency exchange in the airport and like that's the fee. You pay a much higher fee there than if you like went in town and used the bank. That's I feel like what it felt like for me. I felt like I was getting fleeced and I I couldn't get a lower fee. Now James Safert is cryptonative. He claims that he can get um 50 bips uh in terms of a round trip with Bitcoin on his thing, but I did my best to do it, you know, and I'm not dumb, but it took me a while and it it was 1.4%. So honestly though, if you buy it one time and you're never going to buy it again, I think you have to hold it for four or five years because then that that because that 1.4% is a onetime cost. The expense ratio of an ETF is every year. So if you only buy it once and you never make another purchase, it would be cheaper probably to use the exchange if you were going to hold it for more than four or five years. Most people don't operate like that. But if that's what you're going to do, then fine. The other thing with an exchange where you get some benefit is if you want to Sorry about that. If you want to download the Bitcoin into a like a a wallet, right, and actually like have your own address and be able to like, you know, cross a border with it, you know, do the cool Bitcoiny things you want with your Bitcoin, then you you you can't do that with an ETF. And I did that. And I have a little wallet. I'll show you what it looks like. This is the wallet. I forget how much I have on here, but there is Bitcoin with my name on here. And I got to be it feels kind of cool to have this money in something the government can >> I wouldn't trust myself with. Well, that's the other thing I wanted to ask you about like the storage itself. I for one would rather have a fund company like Black Rockck or Fidelity or Gayscale or whoever handle that for me. So, I'm curious what are what are these fund companies actually doing? Like what because I know some people like almost don't they wonder like what what could cause this to go wrong, but like the fund companies they have their assets covered here. Like what are they doing to to make sure your crypto is safe when they're holding in an ETF? Yeah. Well, mo they use most of them use Coinbase, but some use two. I believe Black Rockck now uses two. And just like gold, like there's a couple gold ETFs that diversify across different countries where they hold the gold. In the end though, it's like gold. Like nobody's going to rob the gold out of the vault in London from JP Morgan. It would take like u something way beyond even like a Pink Panther movie. But in the Bitcoin case, there has been hacks. I get it. But the security is really good. And most of the hacks that you've read about are when the money's in a hot wallet, but all of the ETFs immediately move money to multiple cold wallets into cold storage, which is you can't hack. So, if there was a hack, it would probably be a small tiny version of the sort of like temporary funds they have, but once they get like once the um creation of redemptions are over, they sort of shift it over to a cold storage and that's pretty secure. So, >> and and that's basically just like hard drives in a vault, right? So, yeah, completely inaccessible. >> The equivalent of the other thing is honestly if Coinbase were to get hacked, um we'd have like a national emergency. Um because I was looking up the biggest robbery ever was uh nickel dime compared to what you could get off of Coinbase. So, I do think that the more people like Black Rockck and and others that use Coinbase and even just regular retail people, the more it becomes like um you know, a a government's problem, not that they're going to hack it, but it's it's not like some of these hacks that were in like really smaller exchanges. Um and a lot of times like the the bigger issue for Bitcoiners is a getting scammed. Some people go on these Zoom calls and you share your screen and they're able to like take your Bitcoin. I've seen that happen. You don't have to worry about with that with Black Rockck or with an ETF. And then the other one is just getting kidnapped. Uh I know it sounds crazy, but some guy got kidnapped and like they made him smoke crack cocaine and like uh basically like um you know beat him beat him up and dangle them. >> Someone's going to torture you for your passcode now. Yes. That they saw your cold storage. >> It sounds like a a John Wick. >> There actually is a movie called Hacked or Cold Storage. I saw it on an airplane when I was doing research for the book. I watched every Bitcoin movie. >> Sounds like an airplane movie. >> Yeah. And and there there's a movie called Cold Storage where they kidnapped the guy and it's about this exact premise. But then they try to get some woman who was like the V wife of a guy who ran an exchange. They kidnapped her in France, but then someone intervened. Every like four or five months there seems to be a story. The even the native Bitcoiners are actually thinking about moving some to the ETF to avoid this like kidnapping issue. >> It makes sense. I mean, so the the thing is the ETF it just it makes your life simpler, right? It's it's easier to transact if you're like buying this thing on a monthly basis or something and you like you said you have those really tight spreads that expense ratio that you're paying as far as I'm concerned for peace of mind and for ease of access and then when you get out of it if you ever do want to sell you're not paying these exorbitant spreads right which is on a bigger pile of money hopefully if it keeps going up. It just I think the ETF just should add some peace of mind and I think that's why for advisers it sort of unlocked this whole new thing. >> Absolutely. It's the same thing for stocks. People want to outsource stuff. The crypto crowd sometimes can't understand that. They're like, "Why? Not your keys, not your coin." I'm like, "That's exactly. Nobody wants the coin really. They they want to outsource this. Same with stocks. Same with bonds." I would say if you're somebody who's thinking of an allocation, I just think commit to a four-year time frame because there's never been a four-year period where you lose money in Bitcoin. But if you do one to two years, anything can happen. And the second thing is I would tinker a little with maybe trying to get a little money on a hard wallet like play with that concept because it there's a there is a scenario in the future where people do start using wallets to transfer assets around. So it's worth exploring but personally I if you're going to like make a big investment. It just seems like a no-brainer to buy the ETF, >> right? Totally agree. All right. Thanks, Eric. Appreciate it, man. >> Yeah, you got it, man. Have a good one. >> See you. All right. Okay, let's do the next one. >> Okay, up next we got one from Alex. Like skydiving, I have absolutely no interest in cryptocurrency. However, I'm heavily invested in NASDAQ and S&P 500 stocks. The recent crypto crash didn't appear to affect the market a lot, but my understanding is that some investors were selling stocks due to the drop. Uh due to the incredible volatility of crypto, I'm growing more concerned about the effect it may have on my portfolio even though I don't own it. Okay. Uh, two crypto questions this week. Yeah. >> So, my wife always says no way she would want me to, but I would totally go skydiving. I would love it. There's one. You can go on the on the Michigan coast and you can see like all of the sand dunes and the Michigan coastline. You wouldn't do it. I would do it in a heartbeat. >> Not I don't even like flying that much. I would never jump. >> Oh my gosh. I would do it in a heartbeat. >> You know, you should you should go with Jessica from Data Trek. She goes skydiving all the time. Yeah. And and honestly, it's one of those things where listen, if you die skydiving, god forbid, no one can feel sorry for you, right? >> No, you literally are like the punch line of jokes after >> Exactly. But so but that's a good way to go. How did he die skydiving? Can you believe it? >> I'm sorry. Everyone can believe it. >> It's a great Yeah. All right. Um so Luke Cow from Sherwood News actually wrote a story about this recently where he talks about how Bitcoin is behaving like a nonprofitable tech company. All right, let's do the chart here that he shared. So, this is the correlation, like a two-month correlation, three-month correlation of Bitcoin versus nonprofitable tech, which is a Goldman Sachs index that they have, which is kind of funny that they even have an index for this. Um, but it shows that the correlation has been rising. You can see it kind of es and flows, but recently the correlation is rising, which basically means it's at like point 6 something. Basically means that they're moving in the same direction. You can do chart off, Daniel. Um, I guess the thing is sometimes Bitcoin moves in line with tech stocks and sometimes it doesn't. Let's do another chart on this is Bitcoin versus the NASDAQ 100 for the year. You can see for most of the year it was more or less in lock step with the NASDAQ 100. And then in recent months, crypto crashed. The NASDAQ 100 really didn't. And um I guess the way to think about this is maybe Bitcoin is a precursor of things to come in tech. But I don't think it's realistic to think crypto can cause disruptions in the stock market. This is not the tail wagging the dog. The entire crypto market cap right now is $3 trillion. The US stock market is $70 trillion. Right? Bitcoin I think is half of the market cap or maybe twothirds. So crypto is not going to cause a stock market crash. Crypto is just a risk on riskoff asset. So if if tech stocks are falling and there have been a lot of nonprofitable tech stocks getting killed lately, that's not because of crypto. Crypto is falling because those stocks are falling and there's a riskoff attitude, right? So it's not the cause of these moves. It's more like a gauge of risk sentiment. And so when risk is off, sometimes Bitcoin and crypto is going to be off. But the vin diagram with people who own Bitcoin and own a lot of tech stocks is probably a circle, right? You know, it's >> Yes, that's the thing. Crypto really has been like this that at the beginning it was like a venture capital investment, right? And now it's more like this like it like they said a more like nonprofitable tech company with no cash flow. So, and it trades 24/7. So, the volatility is expected. But no, I do not think crypto is going to cause some sort of stock market crash. These crypto people get liquidated all the time. There's so much leverage in this in this industry and these people get nuked and come back to live another day and it it seems to be fine. So I I don't think crypto is nearly big enough to cause a stock market correction. It's just that the tech stocks were falling so crypto was falling too. It's not a cause. >> And if it ever does then we'll clip this and share it on social media. >> Mhm. Bring it. All right. Let's do another one. >> Okay. Up next we got uh we got this one. It's a it's referencing a tweet. Saw this tweet going around and wanted to get Ben's take. Do low gas prices always signal a recession? >> All right. Shall they tweet? Yeah. So, it says, you know, when gas prices are low during recession. That's when. Because gas prices are pretty low right now. What is it for you? For me, I saw 267 today. >> Uh, not to brag, I drive an electric vehicle. I don't pay attention. I have no idea. >> Ah. Oh, cool guy. Um, so in theory, this would make sense. From a supply and demand perspective, you would expect gas prices to fall or be low when there's an economic slowdown. But gas prices, low gas prices in and of themselves do not guarantee a poor economy. Let's do a chart on here. The Federal Reserve has gas prices going back to the late 1970s. You can see like gas prices have fallen in the past five recessions, right? 2020, 2008, 2001, 1991, and 1982. They actually rose in 1980, but that was because inflation was out of control and there was like a gas price oil problem. Um, but look at the 80s and 90s. Gas prices were low and or falling throughout the 80s and 90s and the economy did pretty darn well back then. Gas prices have fallen a lot since that spike in 2022. No recession. Try it off, please. I got my driver's license in the summer of 1997. Gas was insanely cheap back then. I had a 1989 Honda Accord. It was a stick shift. My very first car was a stick shift. First time I ever drove it, I wore that clutch out and I finally figured it out though. You know, actually driving this I don't know if they even have manual transmissions anymore. It makes you feel like you're driving a race car. >> It's more of a special Yeah. special thing now. I Yeah, I'm sure because people on their cell phones all the time in their cars, they probably don't have it anymore. But I liked driving a stick shift. >> My first car was an 88 Honda Accord and uh it was automatic though. So >> last forever, right? Um so I remember putting in like $5 a week into that thing and it left me all the way because gas was like 92 cents a gallon back then. It was so cheap. And guess what? The economy was booming in the 90s. So low gas prices then back then did not signal that that it was a bad economy. It was just there was a glut of oil. And the same thing is happening today, right? Right. So, a lot of it has to do with oil prices. Let's do the next chart here. This is this is nuts. This one really surprises me. Gas is or oil is $56 available right now. It first hit that level in 2005, which I remember back in 2005 paying about $2.50 a gallon for gas and it's still there 20 years later. So, for two decades, there's a two lost decade for oil. It's gone nowhere for two decades. Want to know why? We we discovered more oil. We found better ways of extracting it. We produce more oil now in the United States than ever before. And so that's why gas prices are low. This is a good thing. This is not a bad thing. Now, will they fall even more if we go into a recession? Yeah, probably. Do gas low gas prices right now indicate that we're in a recession? Not necessarily. No, they don't. It's one of the other. It's it's it's >> I like that. Definitive. Definitive. >> Yeah. All right. I've got a funny a funny uh story for our European audience that uh that listens or watches. When I went to Germany a couple years ago, we were renting a car and I saw the gas prices. I was like, "Gas prices really aren't that different here." And then I realized it was Weeders, not >> gallons. Yeah. When I was in Italy last year, I saw I looked at I tried to do the calculation. They pay like $6 or $7 a gallon there. They pay a ton of because they have all these taxes on it. They pay That's why all the cars over there are small. >> Yeah. Yeah. Exactly. >> They do not have the big trucks and SUVs. Why electric has taken off so much? Fair. Yeah. >> Yeah. >> Yeah. >> All right. But yes, low gas prices. Guess what? Right now, this is a good thing. This is not a bad thing. >> Okay. We'll take your word for it. >> Again, throw it in my face if we're actually in a recession right now. >> Yeah. You're giving us a lot of good stuff here to to time stamp. >> All right. >> All right. Up next, we got a question from Boris. >> That's our first ever Boris. >> Got to be, right? >> Maybe. I'm not I'm not sure. >> Do you think we've gotten a Boris before? No way. >> It kind of rings a bell. question. Maybe it's just because maybe I've watched too many episodes of The Americans. >> Okay. Uh my question is about the potential troubles coming. Let's say the market goes down 20% or even 30%. Would I be happy? No. But investing for more than 12 years already, mostly dollar cost averaging. I would think about this kind of decline as a time travel back two or three years. Wouldn't this be a good thing? >> Boris, excellent question. Do you think if you have a name like Boris, you have to like vodka because >> I mean, you're missing a good opportunity. My my mother's maiden name is Kennedy. All my uncles love drinking Guinness and Jameson, >> right? Feel like you just kind of have to. >> Yeah. >> Um I I love the time traveling idea here by Boris. >> And side note, has there ever been a bad time traveling movie? I say no. What a great concept every time. >> Were you a hot tub time machine guy? >> I think that movie is actually underrated. That's a really funny movie. >> Yeah, I thought it was funny. >> All right, so let's take a look at a chart to see how far back a 30% decline in the stock market would take us. It's actually not as far back as you think. you if we fell 30%. This is the Vanguard Total Stock Market Index Fund. A 30% decline from current levels would take us back to January 2024. Things were not so bad in January 2024, were they, Duncan? I bet a lot of people felt pretty wealthy because of the gains we've already seen. >> So, it's not as bad as you think, right? And I guess it obviously makes sense, right? The stock market was up more than 20% last year. It's up almost 20% this year. A 30% decline would take us back again to 2024. Time traveling wouldn't be the worst thing in the world. Boris, are you going to continue to dollar cost average? I bet you are, comrade. Right. No. But don't you think like that if if you're going to dollar cost average, then yes, you should be probably every once in a while, like you said, not being happy about something like that. But it's a chance to go back to those levels that boy, I wish I would have bought more stocks in January 2024. Most people would say that right now, wouldn't they? Gosh, the stock market's up so much since then. I would love to buy stocks at those prices again, >> right? >> Well, maybe you can. We time travel. So, yes, you're right. Wouldn't it be the worst thing in the world? And would it surprise me if we had a a nice little tumble here? No, because of the gains that we've had. Absolutely not. But I I like the way that he's thinking about this. This is a good way to frame it. >> You know what I was probably doing in January 24 was looking at my tech ETFs. >> Looking at my tech ETFs and being like, nah, I don't want to bring my cost basis up by buying here. >> Exactly. Right. It's it's things are way too stretched here. Valuations are too high. >> Yes. >> Yeah. >> Uh well said. Whenever that 20 or 30% crash happens, >> Boris is going to be ready. All right, let's do one more. >> All right, last but not least. Wow, this is kind of I'm feeling sentimental. This is our last ask the compound question of last year of 2025. Okay, here we go. This one's from Ryan. I'm in the unique position where I make too much to contribute to an IRA and most financial advice seems to be geared towards Americans that make less than $100,000 annually. I'm curious to hear what you think about that because I don't think that's the case personally. But >> yeah, I have strong feelings here. >> I've I've made over $400,000 each of the past 12 years. I I have amassed over $3 million in a hodgepodge of custom whole life, a very healthy 401k, and taxable investment accounts. How can I maximize retirement savings in a tax advantaged way or grow a portfolio that will both capture upside growth and withstand extreme downturns that invariably pop up over the next 20-year period? My my goal is to have $300,000 in annual retirement proceeds adjusted for inflation. I'm 46. >> Are they saying they want $300,000 a year to spend in retirement? >> Yes. Yes. So, do the uh do the 4% rule on that. Duncan, what how much does he need? Let's see. So, we do 300,000 divided by 04. He needs $7.5 million if he wants to spend four that 4% rule. >> That I mean, you you work with people in wealth management all the time. That's that's a big number though to spend in a year, right? Like >> that depends on how much money you have. Uh >> I feel like most people most people are aiming for significantly less than that when I, you know, read stuff out there. >> Listen, we work with people that want to spend a million dollars a year. >> It sounds crazy, right? But some of it is frontloaded. And here's the thing, Ryan, my friend, you are mistaken. Most financial advice in the wealth management industry is explicitly geared towards people like you who have millions of dollars. In fact, >> that's what I was thinking. >> One of the criticisms of the wealth management industry over the years is that it's a club reserve for the wealthy. Most financial advisory firms have a million-doll minimum. You can't come to us unless you have a million dollars in liquid assets. Right? I think the last 10 to 15 years has seen an explosion of advice on the internet that's geared towards people who don't have as much money. So, that's a good thing. But the wealth management business is mainly for rich people. Now, that's changing in some respects. There are far more options now. Daniel put the little chart. I'll do I'll do a pad at the back here. Little self-promotion. We at Rit Holtz, we now cater to people at every level, right? From 0 to 250,000, 250 to 1 million, a million to seven. Like, we have all these different tiers where if you have money and you're looking to invest and need some advice, we're willing to work with you. Um, and there's a lot of other places that are doing this now, too, which is great. Uh, you can do the chart off here. Um, here's the thing, Ryan. You need a financial adviser. You have a hodgepodge of investments, right? You have a goal. You want to hit a specific goal. You have a number in mind. Uh, and you don't think that there's any advice out there for, you need to talk to wealth management firm. You need to talk to someone who will work with you and figure out a plan for these next 20 years or however long until you retire. Hey, here's my goal. Here's how we're going to get to it. We're going to take these hodgepodge of investments and turn them from a hodgepodge into a welloiled machine that is going to give you the amount of money you need. It's going to help you reach your goals. It's going to minimize your risk. All of these things. We're going to take into account your time horizon, your goals, all this stuff. You need to talk to someone who can give you advice for that kind of person. But yeah, you're you're looking in the wrong place because there's a ton of advice for people like you. Listen, the wealth management industry wants you. >> They even show people people sometimes complain. you know probably what 70 75% of our questions come from high net worth people you know so and we try our best to have a a nice diversified amount you know uh grouping of questions but yeah I feel like things are definitely catering to wealthier people >> yes again that's been a criticism over the years of the wealth management industry that you don't you don't have enough you don't open up to more people with less means uh so Ryan any wealth management any wealth manager you talk to they will gladly offer you a waste and I I think that's what you need to do at this point like you've obviously amassed a large amount of money at 46 years old. Kudos to you. Well done. Now, it's time to take that pile and do something with it and make an investment plan and a retirement plan and get some advice. Tax planning and estate planning, insurance planning, all this stuff. >> Talk to someone. Anyone will be happy to help you. >> Yeah, for sure. >> All right. >> And good job. >> Yeah. Yeah. Well done. You're our last not to brag of the year. You made it right before the the finish line. >> There we go. >> Um Yeah. Thank you to everyone who's sent in questions over the years, especially this year. Uh we've had a great time. Duncan tells me we're like breaking out to all all time highs and listeners and viewers. >> Amazing growth this year. And yeah, we really appreciate it. The one thing I want to see more of though, we need more reviews and and uh and comments on Spotify and and Apple. So Christmas wish make Tiny Tim's wish come true, >> right? Uh merry Christmas. Happy holidays to all. Remember, email us your questions. Ask the compound show@gmail.com. We will see you January 3rd, 2nd. What's the date? >> The first week of January. >> Oh yeah, we'll see you next year. >> Send us your tax questions. Mr. Bill Sweeper, our first guest of the year. See you then. >> See you everyone.
What if the Stock Market Falls 30%?
Summary
Transcript
Welcome to our final Ask the Compound episode of 2025. This is a show where you, the audience, ask the questions and we provide the answers. The US stock market was up 24% last year. This year, it's up nearly 20%. And that's on top of a 26% gain in 2023. So, would it be that surprising if the stock market fell, say, 20% in 2026? What about 30%. What would that mean? What should you do if this happens? How can you prepare? We're going to cover that scenario on today's show and more. Let's do this. Our email here is ask the compound show@gmail.com. Send us in an email if you have a question. Leave us a comment in a live chat. Dave in the comments last week complained that we did not bring it with holiday sweaters. So today we brought it Duncan. We're wearing our holiday best Thunder myth one. That's pretty good. I like it. On today's show, we're answering questions straight from the viewers about should you buy the Bitcoin ETF versus buying it on an exchange? Can crypto cause the stock market to fall? Are low gas prices signaling a recession? How can you prepare for a stock market crash? And then how do you turn the page on a hodgepodge of investments and make it into an actual retirement plan? But first, today's show is brought to you by Rocket Money. Ever feel like your money just disappears every month? It's easier never to overspend, especially around the holidays. You have subscriptions piling up, impulse buys. Rocket Money helps you rein it in by showing you where your money is going, helping you make better decisions so you can keep more money in your pocket. Rocket Money is a personal finance app that helps you find and cancel unwanted subscriptions, monitors your spending, and helps you lower your bills so you can grow your savings. Rocket Money has saved users over $2.5 billion, including over 880 million in cancelled subscriptions alone. I just got my my monthly hit from Rocket Money in my email inbox saying, "Hey, here's all your subscriptions that are going to renew. I can go through and figure out which ones they need to cut, which ones are rising in price. 10 million members at Rocket Money have saved up to $740 a year when they use all the apps premium features. Cancel those unwanted subscriptions and reach your financial goals faster with Rocket Money. Go to rocketmoney.comc today. It's rocketmoney.comc. rocketmoney.comc or just download the app. >> Yeah. Special thanks to them, too. They've sponsored us a lot this year. We appreciate it. >> Yeah. And I it's it's a great app. I use it all the time. and the the email things like if I forget to check they they check in all the time. It's very nice. Um wanted to share a quick success story. We got an email. This is from someone can't remember the name. You've answered a question of mine in the past back in November of 2022. The show was still called Portfolio Rescue. I kind of forgot about that. When I asked about my girlfriend who was a travel nurse and how she could catch up on her retirement savings, an update on her, she went from $30,000 in retirement savings. This is again, this is 2022 to nearly $300,000 now by maximizing all of her contributions and adding to a brokerage account in addition to her IRA and 401k. 10x retirement savings. >> Not bad. >> That is amazing. That that is the kind of thing I like to hear. That's a great not to brag of the week. And that is that's awesome. That is and that's one of those things where I tell people like it's not just because you waited too long and you you're starting late doesn't mean that all is lost. Like you can you can do these things. That's uh that's that's awesome to hear. leverage do you think they used? >> I mean, the timing was good. November 2022 was when Chad GPT hit the market. So, I'm sure she went all in AI in her retirement accounts. Uh, but great work. >> All right, let's >> Can I just Can I share something that uh I got kind of a >> an offensive comment on YouTube. I just want to share real fast. Uh, >> T7W1 said, "Duncan is 38. I listen to the podcast and don't see the gray beard. Duncan, the yolo years are behind you. Time to give up on Oatley and think of your future. Time is running out. Time is running out. >> He called you middle-aged. It's over. >> Yeah, I >> You're brain your beard just like me. That's My kids are always giving me crap about it. All right, let's get to the first question of the day. >> Okay, up first today we got a question from Chuck. Is there any downside to buying a Bitcoin ETF in a brokerage account rather than buying Bitcoin itself on Coinbase? Is there any scenario where the price of the ETF and the coin itself are de somehow? >> Okay, let's bring on an expert for this one. Eric Belchunis from Bloomberg is the pre-minent authority on all things ETFs. Eric, does anyone love ETFs more than you do? >> They can't, right? >> Definitely not. >> Uh, well, >> you're good for the industry. You're you're an ETF proponent. >> So, there's a couple of different angles here with this with this question. The first one, I guess, is cost. So, I I have some personal experience buying and selling Bitcoin directly on like Coinbase or Robin Hood, and I am shocked by the bit ask spreads there. They're still to me insanely high. So, I want you to walk us through the difference in transaction costs of buying an ETF on one on an exchange wherever in your brokerage account versus buying crypto directly on one of these exchanges. I'm curious what the what do you think that looks like? >> I you know, you you're correct. Uh if if you're from the crypto world and you're buying it on Coinbase and it goes up 50% every year, you probably don't notice that you paid like 1.4% to buy it because you're up so much and you don't know any different. But if you come from the Tradfi world and you're used to like free commission free trading and like tight pennywide spreads, it's highway robbery, >> right? The irony, by the way, the whole irony of the crypto industry, it's a it's, I think, under reportported story, is it's all populist, but the intermediaries are living in like 1970s stock broker worlds. >> Yes. >> Yeah. It's a trady, meanwhile, is living in pure hell. Um, people underrate how much these Schwab and Vanguard and BlackRock and um all the brokerages honestly have just been competing. Remember when they all went to commission free and they all like had to copy each other? It is brutal. It's a hellscape. So the Bitcoin ETF, if you buy it on a brokerage account, there's no trading commission. There's probably a 2% of two basis point spread, maybe three, something like that. We'll call it almost nothing. Then you pay like 20 to 25 bips a year in expense ratio. Do >> Wait, do you think those will go down? Those expense ratios cuz they were when they started they were lower than I felt they'd be. I know that there was a a ton of competition. Do you think those will continue to be eaten away as well? >> Maybe. I I think for now they're like at a at a at a place where most people would say they're cheap >> but like if a Schwab were to come out with like a 10 bit um you know maybe that would force the issue but or Vanguard but if some no-name issuer came in at like two bips it wouldn't matter. It would need to be a big issuer coming in about half the cost and I don't really see that happening. So I would just assume you're going to be 20 to 25. By the way, GBTC was 2%. And hedge funds were 2%. So this is a, you know, virtually 8 to 10 times cheaper than what was previously on the market. So you got that that's really your fee is 25 25 bips a year or something like that. And with Coinbase, I tried this, right? So I've been working on a book all year about this. So I was like, "Okay, let me try to get Bitcoin on my own." if the transfer from your bank account and then when you look at the different I actually got this app called Ledger which is a hard wallet and that has a software that allows you to look at all the exchanges to see where what the deals are and honestly I couldn't find anything below 1.5% when I wanted to trade my dollars for Bitcoin and that I believe is inclusive of the spread but also it's almost like it felt to me like when you know when you go to airport in a foreign country and like there's the currency exchange in the airport and like that's the fee. You pay a much higher fee there than if you like went in town and used the bank. That's I feel like what it felt like for me. I felt like I was getting fleeced and I I couldn't get a lower fee. Now James Safert is cryptonative. He claims that he can get um 50 bips uh in terms of a round trip with Bitcoin on his thing, but I did my best to do it, you know, and I'm not dumb, but it took me a while and it it was 1.4%. So honestly though, if you buy it one time and you're never going to buy it again, I think you have to hold it for four or five years because then that that because that 1.4% is a onetime cost. The expense ratio of an ETF is every year. So if you only buy it once and you never make another purchase, it would be cheaper probably to use the exchange if you were going to hold it for more than four or five years. Most people don't operate like that. But if that's what you're going to do, then fine. The other thing with an exchange where you get some benefit is if you want to Sorry about that. If you want to download the Bitcoin into a like a a wallet, right, and actually like have your own address and be able to like, you know, cross a border with it, you know, do the cool Bitcoiny things you want with your Bitcoin, then you you you can't do that with an ETF. And I did that. And I have a little wallet. I'll show you what it looks like. This is the wallet. I forget how much I have on here, but there is Bitcoin with my name on here. And I got to be it feels kind of cool to have this money in something the government can >> I wouldn't trust myself with. Well, that's the other thing I wanted to ask you about like the storage itself. I for one would rather have a fund company like Black Rockck or Fidelity or Gayscale or whoever handle that for me. So, I'm curious what are what are these fund companies actually doing? Like what because I know some people like almost don't they wonder like what what could cause this to go wrong, but like the fund companies they have their assets covered here. Like what are they doing to to make sure your crypto is safe when they're holding in an ETF? Yeah. Well, mo they use most of them use Coinbase, but some use two. I believe Black Rockck now uses two. And just like gold, like there's a couple gold ETFs that diversify across different countries where they hold the gold. In the end though, it's like gold. Like nobody's going to rob the gold out of the vault in London from JP Morgan. It would take like u something way beyond even like a Pink Panther movie. But in the Bitcoin case, there has been hacks. I get it. But the security is really good. And most of the hacks that you've read about are when the money's in a hot wallet, but all of the ETFs immediately move money to multiple cold wallets into cold storage, which is you can't hack. So, if there was a hack, it would probably be a small tiny version of the sort of like temporary funds they have, but once they get like once the um creation of redemptions are over, they sort of shift it over to a cold storage and that's pretty secure. So, >> and and that's basically just like hard drives in a vault, right? So, yeah, completely inaccessible. >> The equivalent of the other thing is honestly if Coinbase were to get hacked, um we'd have like a national emergency. Um because I was looking up the biggest robbery ever was uh nickel dime compared to what you could get off of Coinbase. So, I do think that the more people like Black Rockck and and others that use Coinbase and even just regular retail people, the more it becomes like um you know, a a government's problem, not that they're going to hack it, but it's it's not like some of these hacks that were in like really smaller exchanges. Um and a lot of times like the the bigger issue for Bitcoiners is a getting scammed. Some people go on these Zoom calls and you share your screen and they're able to like take your Bitcoin. I've seen that happen. You don't have to worry about with that with Black Rockck or with an ETF. And then the other one is just getting kidnapped. Uh I know it sounds crazy, but some guy got kidnapped and like they made him smoke crack cocaine and like uh basically like um you know beat him beat him up and dangle them. >> Someone's going to torture you for your passcode now. Yes. That they saw your cold storage. >> It sounds like a a John Wick. >> There actually is a movie called Hacked or Cold Storage. I saw it on an airplane when I was doing research for the book. I watched every Bitcoin movie. >> Sounds like an airplane movie. >> Yeah. And and there there's a movie called Cold Storage where they kidnapped the guy and it's about this exact premise. But then they try to get some woman who was like the V wife of a guy who ran an exchange. They kidnapped her in France, but then someone intervened. Every like four or five months there seems to be a story. The even the native Bitcoiners are actually thinking about moving some to the ETF to avoid this like kidnapping issue. >> It makes sense. I mean, so the the thing is the ETF it just it makes your life simpler, right? It's it's easier to transact if you're like buying this thing on a monthly basis or something and you like you said you have those really tight spreads that expense ratio that you're paying as far as I'm concerned for peace of mind and for ease of access and then when you get out of it if you ever do want to sell you're not paying these exorbitant spreads right which is on a bigger pile of money hopefully if it keeps going up. It just I think the ETF just should add some peace of mind and I think that's why for advisers it sort of unlocked this whole new thing. >> Absolutely. It's the same thing for stocks. People want to outsource stuff. The crypto crowd sometimes can't understand that. They're like, "Why? Not your keys, not your coin." I'm like, "That's exactly. Nobody wants the coin really. They they want to outsource this. Same with stocks. Same with bonds." I would say if you're somebody who's thinking of an allocation, I just think commit to a four-year time frame because there's never been a four-year period where you lose money in Bitcoin. But if you do one to two years, anything can happen. And the second thing is I would tinker a little with maybe trying to get a little money on a hard wallet like play with that concept because it there's a there is a scenario in the future where people do start using wallets to transfer assets around. So it's worth exploring but personally I if you're going to like make a big investment. It just seems like a no-brainer to buy the ETF, >> right? Totally agree. All right. Thanks, Eric. Appreciate it, man. >> Yeah, you got it, man. Have a good one. >> See you. All right. Okay, let's do the next one. >> Okay, up next we got one from Alex. Like skydiving, I have absolutely no interest in cryptocurrency. However, I'm heavily invested in NASDAQ and S&P 500 stocks. The recent crypto crash didn't appear to affect the market a lot, but my understanding is that some investors were selling stocks due to the drop. Uh due to the incredible volatility of crypto, I'm growing more concerned about the effect it may have on my portfolio even though I don't own it. Okay. Uh, two crypto questions this week. Yeah. >> So, my wife always says no way she would want me to, but I would totally go skydiving. I would love it. There's one. You can go on the on the Michigan coast and you can see like all of the sand dunes and the Michigan coastline. You wouldn't do it. I would do it in a heartbeat. >> Not I don't even like flying that much. I would never jump. >> Oh my gosh. I would do it in a heartbeat. >> You know, you should you should go with Jessica from Data Trek. She goes skydiving all the time. Yeah. And and honestly, it's one of those things where listen, if you die skydiving, god forbid, no one can feel sorry for you, right? >> No, you literally are like the punch line of jokes after >> Exactly. But so but that's a good way to go. How did he die skydiving? Can you believe it? >> I'm sorry. Everyone can believe it. >> It's a great Yeah. All right. Um so Luke Cow from Sherwood News actually wrote a story about this recently where he talks about how Bitcoin is behaving like a nonprofitable tech company. All right, let's do the chart here that he shared. So, this is the correlation, like a two-month correlation, three-month correlation of Bitcoin versus nonprofitable tech, which is a Goldman Sachs index that they have, which is kind of funny that they even have an index for this. Um, but it shows that the correlation has been rising. You can see it kind of es and flows, but recently the correlation is rising, which basically means it's at like point 6 something. Basically means that they're moving in the same direction. You can do chart off, Daniel. Um, I guess the thing is sometimes Bitcoin moves in line with tech stocks and sometimes it doesn't. Let's do another chart on this is Bitcoin versus the NASDAQ 100 for the year. You can see for most of the year it was more or less in lock step with the NASDAQ 100. And then in recent months, crypto crashed. The NASDAQ 100 really didn't. And um I guess the way to think about this is maybe Bitcoin is a precursor of things to come in tech. But I don't think it's realistic to think crypto can cause disruptions in the stock market. This is not the tail wagging the dog. The entire crypto market cap right now is $3 trillion. The US stock market is $70 trillion. Right? Bitcoin I think is half of the market cap or maybe twothirds. So crypto is not going to cause a stock market crash. Crypto is just a risk on riskoff asset. So if if tech stocks are falling and there have been a lot of nonprofitable tech stocks getting killed lately, that's not because of crypto. Crypto is falling because those stocks are falling and there's a riskoff attitude, right? So it's not the cause of these moves. It's more like a gauge of risk sentiment. And so when risk is off, sometimes Bitcoin and crypto is going to be off. But the vin diagram with people who own Bitcoin and own a lot of tech stocks is probably a circle, right? You know, it's >> Yes, that's the thing. Crypto really has been like this that at the beginning it was like a venture capital investment, right? And now it's more like this like it like they said a more like nonprofitable tech company with no cash flow. So, and it trades 24/7. So, the volatility is expected. But no, I do not think crypto is going to cause some sort of stock market crash. These crypto people get liquidated all the time. There's so much leverage in this in this industry and these people get nuked and come back to live another day and it it seems to be fine. So I I don't think crypto is nearly big enough to cause a stock market correction. It's just that the tech stocks were falling so crypto was falling too. It's not a cause. >> And if it ever does then we'll clip this and share it on social media. >> Mhm. Bring it. All right. Let's do another one. >> Okay. Up next we got uh we got this one. It's a it's referencing a tweet. Saw this tweet going around and wanted to get Ben's take. Do low gas prices always signal a recession? >> All right. Shall they tweet? Yeah. So, it says, you know, when gas prices are low during recession. That's when. Because gas prices are pretty low right now. What is it for you? For me, I saw 267 today. >> Uh, not to brag, I drive an electric vehicle. I don't pay attention. I have no idea. >> Ah. Oh, cool guy. Um, so in theory, this would make sense. From a supply and demand perspective, you would expect gas prices to fall or be low when there's an economic slowdown. But gas prices, low gas prices in and of themselves do not guarantee a poor economy. Let's do a chart on here. The Federal Reserve has gas prices going back to the late 1970s. You can see like gas prices have fallen in the past five recessions, right? 2020, 2008, 2001, 1991, and 1982. They actually rose in 1980, but that was because inflation was out of control and there was like a gas price oil problem. Um, but look at the 80s and 90s. Gas prices were low and or falling throughout the 80s and 90s and the economy did pretty darn well back then. Gas prices have fallen a lot since that spike in 2022. No recession. Try it off, please. I got my driver's license in the summer of 1997. Gas was insanely cheap back then. I had a 1989 Honda Accord. It was a stick shift. My very first car was a stick shift. First time I ever drove it, I wore that clutch out and I finally figured it out though. You know, actually driving this I don't know if they even have manual transmissions anymore. It makes you feel like you're driving a race car. >> It's more of a special Yeah. special thing now. I Yeah, I'm sure because people on their cell phones all the time in their cars, they probably don't have it anymore. But I liked driving a stick shift. >> My first car was an 88 Honda Accord and uh it was automatic though. So >> last forever, right? Um so I remember putting in like $5 a week into that thing and it left me all the way because gas was like 92 cents a gallon back then. It was so cheap. And guess what? The economy was booming in the 90s. So low gas prices then back then did not signal that that it was a bad economy. It was just there was a glut of oil. And the same thing is happening today, right? Right. So, a lot of it has to do with oil prices. Let's do the next chart here. This is this is nuts. This one really surprises me. Gas is or oil is $56 available right now. It first hit that level in 2005, which I remember back in 2005 paying about $2.50 a gallon for gas and it's still there 20 years later. So, for two decades, there's a two lost decade for oil. It's gone nowhere for two decades. Want to know why? We we discovered more oil. We found better ways of extracting it. We produce more oil now in the United States than ever before. And so that's why gas prices are low. This is a good thing. This is not a bad thing. Now, will they fall even more if we go into a recession? Yeah, probably. Do gas low gas prices right now indicate that we're in a recession? Not necessarily. No, they don't. It's one of the other. It's it's it's >> I like that. Definitive. Definitive. >> Yeah. All right. I've got a funny a funny uh story for our European audience that uh that listens or watches. When I went to Germany a couple years ago, we were renting a car and I saw the gas prices. I was like, "Gas prices really aren't that different here." And then I realized it was Weeders, not >> gallons. Yeah. When I was in Italy last year, I saw I looked at I tried to do the calculation. They pay like $6 or $7 a gallon there. They pay a ton of because they have all these taxes on it. They pay That's why all the cars over there are small. >> Yeah. Yeah. Exactly. >> They do not have the big trucks and SUVs. Why electric has taken off so much? Fair. Yeah. >> Yeah. >> Yeah. >> All right. But yes, low gas prices. Guess what? Right now, this is a good thing. This is not a bad thing. >> Okay. We'll take your word for it. >> Again, throw it in my face if we're actually in a recession right now. >> Yeah. You're giving us a lot of good stuff here to to time stamp. >> All right. >> All right. Up next, we got a question from Boris. >> That's our first ever Boris. >> Got to be, right? >> Maybe. I'm not I'm not sure. >> Do you think we've gotten a Boris before? No way. >> It kind of rings a bell. question. Maybe it's just because maybe I've watched too many episodes of The Americans. >> Okay. Uh my question is about the potential troubles coming. Let's say the market goes down 20% or even 30%. Would I be happy? No. But investing for more than 12 years already, mostly dollar cost averaging. I would think about this kind of decline as a time travel back two or three years. Wouldn't this be a good thing? >> Boris, excellent question. Do you think if you have a name like Boris, you have to like vodka because >> I mean, you're missing a good opportunity. My my mother's maiden name is Kennedy. All my uncles love drinking Guinness and Jameson, >> right? Feel like you just kind of have to. >> Yeah. >> Um I I love the time traveling idea here by Boris. >> And side note, has there ever been a bad time traveling movie? I say no. What a great concept every time. >> Were you a hot tub time machine guy? >> I think that movie is actually underrated. That's a really funny movie. >> Yeah, I thought it was funny. >> All right, so let's take a look at a chart to see how far back a 30% decline in the stock market would take us. It's actually not as far back as you think. you if we fell 30%. This is the Vanguard Total Stock Market Index Fund. A 30% decline from current levels would take us back to January 2024. Things were not so bad in January 2024, were they, Duncan? I bet a lot of people felt pretty wealthy because of the gains we've already seen. >> So, it's not as bad as you think, right? And I guess it obviously makes sense, right? The stock market was up more than 20% last year. It's up almost 20% this year. A 30% decline would take us back again to 2024. Time traveling wouldn't be the worst thing in the world. Boris, are you going to continue to dollar cost average? I bet you are, comrade. Right. No. But don't you think like that if if you're going to dollar cost average, then yes, you should be probably every once in a while, like you said, not being happy about something like that. But it's a chance to go back to those levels that boy, I wish I would have bought more stocks in January 2024. Most people would say that right now, wouldn't they? Gosh, the stock market's up so much since then. I would love to buy stocks at those prices again, >> right? >> Well, maybe you can. We time travel. So, yes, you're right. Wouldn't it be the worst thing in the world? And would it surprise me if we had a a nice little tumble here? No, because of the gains that we've had. Absolutely not. But I I like the way that he's thinking about this. This is a good way to frame it. >> You know what I was probably doing in January 24 was looking at my tech ETFs. >> Looking at my tech ETFs and being like, nah, I don't want to bring my cost basis up by buying here. >> Exactly. Right. It's it's things are way too stretched here. Valuations are too high. >> Yes. >> Yeah. >> Uh well said. Whenever that 20 or 30% crash happens, >> Boris is going to be ready. All right, let's do one more. >> All right, last but not least. Wow, this is kind of I'm feeling sentimental. This is our last ask the compound question of last year of 2025. Okay, here we go. This one's from Ryan. I'm in the unique position where I make too much to contribute to an IRA and most financial advice seems to be geared towards Americans that make less than $100,000 annually. I'm curious to hear what you think about that because I don't think that's the case personally. But >> yeah, I have strong feelings here. >> I've I've made over $400,000 each of the past 12 years. I I have amassed over $3 million in a hodgepodge of custom whole life, a very healthy 401k, and taxable investment accounts. How can I maximize retirement savings in a tax advantaged way or grow a portfolio that will both capture upside growth and withstand extreme downturns that invariably pop up over the next 20-year period? My my goal is to have $300,000 in annual retirement proceeds adjusted for inflation. I'm 46. >> Are they saying they want $300,000 a year to spend in retirement? >> Yes. Yes. So, do the uh do the 4% rule on that. Duncan, what how much does he need? Let's see. So, we do 300,000 divided by 04. He needs $7.5 million if he wants to spend four that 4% rule. >> That I mean, you you work with people in wealth management all the time. That's that's a big number though to spend in a year, right? Like >> that depends on how much money you have. Uh >> I feel like most people most people are aiming for significantly less than that when I, you know, read stuff out there. >> Listen, we work with people that want to spend a million dollars a year. >> It sounds crazy, right? But some of it is frontloaded. And here's the thing, Ryan, my friend, you are mistaken. Most financial advice in the wealth management industry is explicitly geared towards people like you who have millions of dollars. In fact, >> that's what I was thinking. >> One of the criticisms of the wealth management industry over the years is that it's a club reserve for the wealthy. Most financial advisory firms have a million-doll minimum. You can't come to us unless you have a million dollars in liquid assets. Right? I think the last 10 to 15 years has seen an explosion of advice on the internet that's geared towards people who don't have as much money. So, that's a good thing. But the wealth management business is mainly for rich people. Now, that's changing in some respects. There are far more options now. Daniel put the little chart. I'll do I'll do a pad at the back here. Little self-promotion. We at Rit Holtz, we now cater to people at every level, right? From 0 to 250,000, 250 to 1 million, a million to seven. Like, we have all these different tiers where if you have money and you're looking to invest and need some advice, we're willing to work with you. Um, and there's a lot of other places that are doing this now, too, which is great. Uh, you can do the chart off here. Um, here's the thing, Ryan. You need a financial adviser. You have a hodgepodge of investments, right? You have a goal. You want to hit a specific goal. You have a number in mind. Uh, and you don't think that there's any advice out there for, you need to talk to wealth management firm. You need to talk to someone who will work with you and figure out a plan for these next 20 years or however long until you retire. Hey, here's my goal. Here's how we're going to get to it. We're going to take these hodgepodge of investments and turn them from a hodgepodge into a welloiled machine that is going to give you the amount of money you need. It's going to help you reach your goals. It's going to minimize your risk. All of these things. We're going to take into account your time horizon, your goals, all this stuff. You need to talk to someone who can give you advice for that kind of person. But yeah, you're you're looking in the wrong place because there's a ton of advice for people like you. Listen, the wealth management industry wants you. >> They even show people people sometimes complain. you know probably what 70 75% of our questions come from high net worth people you know so and we try our best to have a a nice diversified amount you know uh grouping of questions but yeah I feel like things are definitely catering to wealthier people >> yes again that's been a criticism over the years of the wealth management industry that you don't you don't have enough you don't open up to more people with less means uh so Ryan any wealth management any wealth manager you talk to they will gladly offer you a waste and I I think that's what you need to do at this point like you've obviously amassed a large amount of money at 46 years old. Kudos to you. Well done. Now, it's time to take that pile and do something with it and make an investment plan and a retirement plan and get some advice. Tax planning and estate planning, insurance planning, all this stuff. >> Talk to someone. Anyone will be happy to help you. >> Yeah, for sure. >> All right. >> And good job. >> Yeah. Yeah. Well done. You're our last not to brag of the year. You made it right before the the finish line. >> There we go. >> Um Yeah. Thank you to everyone who's sent in questions over the years, especially this year. Uh we've had a great time. Duncan tells me we're like breaking out to all all time highs and listeners and viewers. >> Amazing growth this year. And yeah, we really appreciate it. The one thing I want to see more of though, we need more reviews and and uh and comments on Spotify and and Apple. So Christmas wish make Tiny Tim's wish come true, >> right? Uh merry Christmas. Happy holidays to all. Remember, email us your questions. Ask the compound show@gmail.com. We will see you January 3rd, 2nd. What's the date? >> The first week of January. >> Oh yeah, we'll see you next year. >> Send us your tax questions. Mr. Bill Sweeper, our first guest of the year. See you then. >> See you everyone.