The Importance of Financial Literacy
Episode 1 - In this inaugural episode of the Gen-Relational Wealth podcast, host Gordon Haas discusses the importance of financial planning and the journey to becoming a CERTIFIED FINANCIAL PLANNER®. He shares personal experiences that shaped his perspective on finance, including life-threatening health challenges. The conversation emphasizes the significance of teaching financial literacy to the next generation and the role of family in financial education. Gordon also outlines the vision for future podcast episodes, focusing on retirement planning and the importance of seeking financial advice at various life stages.
Guest Information:
Pamela Strell of Krasnogorov Studio
Pamela is co-owner of Krasnogorov Studio in Hoboken, New Jersey, formerly Thomas Newman Studio.
Krasnogorov Studio designs and crafts exquisite sculptural carved wood lighting and furniture. They have been featured in Architectural Digest and have received numerous industry accolades. Have a look at their breathtaking work which focuses on sensual and twisting elements in wood.
https://www.instagram.com/krasnogorov_studio/
Episode Outline
00:00 Introduction to Guest Host, Pamela Strell
00:36 Intro to GenRelational Wealth Podcast
01:44 The Role of a CERTIFIED FINANCIAL PLANNER®
05:46 Life Challenges and Their Impact on Financial Planning
12:38 Planning in Different Stages of Life
17:05 Upcoming Episodes
18:28 What Gordon Teaches His Children and What His Parents Taught Him
21:27 Budgeting, Planning, and Fun
24:25 Gordon’s Initial Interest in Finance
25:28 Planning for the Unexpected / Chronic Illness
30:22 Gordon’s Personal Retirement Plans
31:38 Conclusion
32:24 Disclosures
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Transcript:
Gordon Haas (00:00)
In this episode, my good friend Pamela Strell, guest hosts as I explain what I do and why I do it. Pamela is co-owner of Krasnogorov Studio in Hoboken, New Jersey, formerly Thomas Newman Studio. Krasnogorov Studio designs and builds exquisite sculptural carved wood lighting and furniture. They have been featured in Architectural Digest and have received so many industry accolades, I can't begin to list them all. To me, their pieces are gorgeous functional art and I encourage you to take a look at what Krasnogorov Studio is creating. You can find the links in the show notes.
Gordon Haas (00:36)
Welcome Pamela. So glad you can join me for my very first podcast episode.
Let's jump right in.
Pamela (00:41)
Gordon, why did you name this podcast, GenRelational Wealth?
Gordon Haas (00:47)
Yeah, It's a little bit of a tongue twister, Gen-Relational wealth. And obviously it plays off of generational wealth, where as I see it, it's usually an individual in the family trying to make as much money as possible to pass on to future generations. But I'm looking more at the interrelation on how stories are passed down from generation to generation about managing money. And we're also at a point in life where a lot of people I know are dealing with aging parents and kids in college or high school or recent college graduates as well.
I've met a lot of people who, the first thing they bring up in conversation is, I learned so much from my my parent, my father, my mother, or my grandparents on how to manage money or finance. And then other people say, you know, I learned from my parents exactly how not to do things as far as finance is concerned by the mistakes they made. And I think both of them are worthy for exploring.
Pamela (01:44)
Congratulations on this podcast and thank you for bringing
information and making it accessible to the public.
Gordon Haas (01:51)
Thank you Pamela.
Pamela (01:52)
So why don't you explain what you actually do for a living and why you do it?
Gordon Haas (02:00)
Yeah, so I am a technical, the title is a financial advisor. And, you know, in order to become a financial advisor, there's a lot of certifications that you have to go through in order to be a fiduciary and give advice in the best interest of my clients. But I also am a CFP®, a CERTIFIED FINANCIAL PLANNER®. And everything really starts with planning and planning is such a almost a jaded overused term that a lot of companies say that they're planners, but what exactly does that mean? And in my case, it's focusing more on retirement planning. Usually people have a need or let's say a pain point of something in their life that they really need to solve in the near term in order to get over a financial hump, whether it's a medical issue or again, planning for college or retirement or various things like chronic illnesses.
And that's when we usually get drawn into the conversation. And that's a great point for us to start talking about the topic at hand. But the financial planning process is a long-term process where we just jump into everything. So the way we work with our clients is usually we have an initial conversation. There's no cost to that initial consult. And it's either usually with an individual or a couple. And we'll talk about everything from their assets, their debt, their budgeting, the way they think about money, how they relate to money together, if they have a joint budget, who earns more in the relationship, what across the board is their risk, where we should look at protection, estate planning, if they have children. So there's a lot of different topics that we'll cover.
And the initial conversation is really just to get a general overview of what they're looking for at this point in time and to see if there's a match because as you can imagine there's more to finding a good planner or a good relationship with an advisor than simply you does this person know what he or she's talking about you want somebody that you are comfortable talking with sensitive topics like this about someone who understands and someone who listens right a lot of times people will say,
“This is exactly how you should do things because that's what the textbook says.” But we listen to our prospects and our clients to really understand what their goals are in retirement because everybody has unique goals in retirement and everybody's retirement vision is different. Some people love to travel. Other people want to stay home and read a book. Other people want to golf. And so what does retirement look like for you or what does you know, any of your financial goals look like in the future and then how can we get there?
And it's a step-by-step basis. It's not overwhelming where we're just throwing everything at you all at once. We usually meet with clients quarterly and we tackle a different topic that is either top of mind or seasonally there are certain things that are more important to do certain times a year. For example, towards the end of the year, it's important to take a look at preparing for taxes and and contributing to 401Ks if you're still working and things along those lines. And we look at it on an ongoing basis in our team.
Pamela (05:26)
So what exactly is a CFP®?
Gordon Haas (05:31)
A CFP® is a CERTIFIED FINANCIAL PLANNER®. In order for us to be prepared for the CFP® exam, it's at least a year of study in every topic you could imagine dealing with finance.
Pamela (05:45)
And at what point in your life did you endeavor to take this on?
Gordon Haas (05:52)
Well, to be perfectly honest, was within a week of my cardiac arrest.
Pamela (06:00)
My gosh, no are you saying you had a heart attack and then an epiphany and boom, you jumped into this stressful course load?
Gordon Haas (06:10)
I don't know if it was so much of an epiphany as much as a reason to focus on something besides my cardiac issues. So what happened was during COVID, I did have some chest pains and asked my wife to take me to the hospital in the middle of the night. During COVID,it was a difficult time to be sick, but I did go to the hospital and they said everything looked fine. I had chest pains and then a couple hours later I went into cardiac arrest. My heart had stopped and they shocked me back to life after a few minutes and there was a lot of damage that was done to my heart specifically because there wasn't a doctor on staff but when they did shock me back and I was waiting for the doctor to put the stent in, there really was a time where I wasn't sure if I was going to survive the night or not.
And I was lying there, which could have been on my deathbed. And I did think of three things that came to mind. First of all, was really proud of my boys who are now young men and independent and the men that they've become and the fact that they would be fine without me. I also was so appreciative of the life, the full life I've lived with my wife Monique. And then...literally the third thing I thought about while I was there was thank God I had life insurance and there would be some sort of comfort financially for my family if I didn't make it through the night. So that was one of the things that really kind of had me think about if I was getting into the world of finance that first of all, the protection was important. And then again, a week later I did sign up for the CFP® exam mainly because it gave me something to focus on. It was something that I had thought about doing earlier, but it really had me focus on something besides my medical conditions. So I could focus on getting better, but I also put a goal out there for a year plus that I'd be taking an exam that was really difficult and it was something to live for outside of just getting better.
Pamela (08:17)
Are you kidding me? They told you, you were fine, but okay, let's move forward and get to the part where I started tearing up because of the three things that dawned on you while you were thinking that you had bitten the bullet. So, wow, Gordon, I totally understand your beginnings in this field. And that's quite a moving story.
Pamela (08:41)
I also know that you have had other life threatening illnesses and it hasn't been an easy journey for you to get here and you've reinvented yourself like many people have throughout the decades as an adult. Can you discuss a little bit about your history?
Gordon Haas (09:02)
Sure, sure. Yeah. And at this age and at most ages when you've been through a few things in life, I don't know if it's necessarily easy for anybody. And I think we all understand that what builds character is how you react to certain challenges in life. So I try to look at life from a positive perspective and even from the challenges, the health challenges that I've been through. I also had cancer, an advanced cancer in my 30’s when my kids were very little. And, you know, obviously, luckily, I was able to overcome that after a long stint with chemo. from each one of these life-threatening situations, I've shifted not only in life and in outlook, but also in perspective from my career. So, yes, I've had various different experiences in different industries. I actually had a toy company for a decade and a half and that was wonderful and a dream that I chased in order to have an outlet in my creative side and I really liked that. I started off in engineering. I have an engineering background and I worked in Silicon Valley and in the aerospace industry and the computer high tech industry. then when I... I went to Columbia University in New York City.
Pamela (10:16)
Where did you attend college, Gordon?
Gordon Haas (10:22)
It's where I met my wife as well, we were both, it was love in the engineering department.
Pamela (10:26)
So you were both engineering majors?
Gordon Haas (10:29)
We were both mechanical engineering majors at Columbia and it was a wonderful experience going to school in New York City as well.
Pamela (10:36)
Uh-huh. I, as full disclosure, as your friend, I know what your toy business was, but because we're introducing you on this podcast for the first time, I would just like to say that you invented some fantastic toys back in the nineties and SquashBlox®. If anyone is familiar with these building blocks that are attached by Velcro, my
Gordon Haas (10:52)
Thanks, Pamela.
Pamela (11:04)
kids had hours and hours of fun playing with your toys.
Because of experiences with health challenges, do you see planning and investment for your clients through a different lens?
Gordon Haas (11:22)
Yeah, yeah, absolutely. Because I think most of us or many of us who are listening that have not had any major medical issues, just like I was before my heart attack, I was healthy, I was fit. Early on in life, it's wonderful to think that you're immortal. But from that perspective, it's the whole concept of financial planning, right? Thinking ahead or retirement planning, or even just putting money into a 401k and tucking it away for retirement when you're in your twenties, it just seems so foreign and almost unnatural, right?
But since I've been through these various experiences, my own illnesses, as well as dealing with parents, of, unfortunately, both my parents have passed and through that process as well. learned a lot about various aspects of life and planning and estate planning. But I think from that perspective, I can share actual stories, right? It's not, again, textbooks that I've read and the CFP® exam to tell people what could possibly happen. I've got quite a few cautionary tales that have actually happened to me that I've made it through, but I think can help convey to clients how to better prepare for the unexpected.
Pamela (12:38)
What age would you recommend someone seek out the assistance of a CERTIFIED FINANCIAL PLANNER®?
Gordon Haas (12:46)
Well, again, it's different at every age and every stage. As soon as you start a career, it's always a good idea to start planning because the biggest thing that our kids have, and I've got two boys that are 23 and 25, but I make sure that they invest in a Roth 401k because the biggest asset they have is, first of all, their earning capacity. But second of all, time. Hopefully they have a lot, lot more time than I do. And the younger you are and the more you invest, early on, you can just let it sit and the compound interest and the growth in the market will do all the work. So at any age, it's important to start thinking about these things. As far as pure retirement planning is concerned, we see most people in their, I'd say 50s where they say, oh, no, it's around the corner. It's 10, 15, 20 years out and I better start doing things either differently or more of it and really have an idea on what I'm planning for because I'm starting to get nervous. That's usually where we are.
Pamela (13:50)
So they're not coming to you when they're too old and it's not too late, but you would recommend someone see you earlier in life so they have more time to plan?
Gordon Haas (14:03)
Again, Pamela, it depends on what we're looking at and that pain point, right? So we see plenty of clients who we've met for the first time in their 70s or so, and usually their focus is not budgeting or saving for retirement, of course, because they're well into retirement. At that point, it might be they have investments and portfolios that are scattered all over the place. They've worked with a lot of different people. They have no idea how the taxation works across the board or estate planning.
And I'm not a lawyer, so I don't do estate planning per se, but I work with a team of really close advisors, including CPAs and estate attorneys who can work together to create that plan.
Pamela (14:47)
If somebody wanted to consult with you, are you limited to clients in the state of New Jersey only, or can you offer advice and consulting to people anywhere?
Gordon Haas (15:01)
Sure, sure. That's great question. Historically, I think the large majority of people as well as advisors would be sitting down in person. But since the pandemic, people are a lot more comfortable on Zoom and by phone. So actually, large majority of our clients, we do meet virtually. And our clients are comfortable with that and prefer that. So that does open the door for us to deal with clients across the country. So we have engagements across country.
Pamela (15:28)
So your knowledge of financial planning is not limited to state laws? I guess my question is, if I need financial planning advice, does it matter where I live and the state laws or are federal laws, the laws that guide financial planning?
Gordon Haas (15:49)
So the large majority of tax consequences are on a federal level, the IRS, that's a federal entity. So that's the same no matter where you live. There are in addition, certain states like New York, New Jersey, where we live, that have state taxes as well. And there are state taxes from you know, when you sell stocks to income that you pay taxes on to a estate taxes when someone passes away. So there are rules that vary state to state, the large majority from a high perspective is the same across the board. But if it's in another state, we make sure to be knowledgeable about the state information as well. And again, usually, we'll refer them to a local their accountant or CPA to double check and make sure everything's in place.
Pamela (16:35)
So you're qualified to be my planner anywhere in this country, and you'll bring on professional specialists in any area that's needed if there are state constraints, you're saying.
Gordon Haas (16:49)
No, because I am not registered in every single state in the country. I could become that but I don't currently have clients in every one of the 50 states. So if I do get clients in certain states, I certainly can register but I am registered in a handful of states at this point
Pamela (17:05)
In your podcast, Gordon, what can we look forward to on upcoming episodes?
Gordon Haas (17:12)
Yeah. So the way I envision this podcast is again, not to be so technical to get into the weeds on Roth conversions, although I want to cover that. It's more from the aspect again of gen relational wealth. So talking about the various stories of how family members talk about money and finance throughout the generations, but with the focus specifically on retirement planning, right? I think retirement planning is also such a gray area for people who are getting close to it. And they just, get more nervous about it than they should because they don't even know what it looks like. And I've heard a lot that there are three stages of retirement. There's the go-go years, there's the slow-go years, and then there's the no-go years. And so what exactly does that mean and how does it look at various stages? I want to have guests who are professionals who deal with every aspect of that.
Hopefully with engaging and informative guests who can also share where they're coming from, from a gen relational perspective of money as well and how they think about money.
Pamela (18:28)
Speaking of gen-relational wealth, I'm just wondering if it's okay to ask you what you teach your own children?
Gordon Haas (18:37)
Yeah. So again, my two boys are now 23 and 25. And I think the main point that I'd like to get across to them is how lucky they are to live in this country at this point in history, to have the freedom to build a career of something that interests them. And really for the education that they've been given. They're really independent to work towards their own goals. And as I mentioned before also, that their biggest resource is time. So that if they put a little money aside now for retirement, it's not all that painful, but it'll grow into significant sums down the line.
Pamela (19:26)
Did your parents talk to you about money?
Gordon Haas (19:30)
Yeah, my father did. the story about my parents is I'm first generation. both my parents are from Europe. My father was from Germany, my mother, Lithuania, and they had gone back there many, many generations. So my father literally came here with, with nothing, nothing in his pocket, but he put himself through high school and college in New York and graduate school,and he was always very emphatic about the power of education. He was quite good at sticking on a budget, but again, he came here with nothing and he got a job at General Electric and worked there for 35 years. And I would say lived the American dream because he didn't, you hear these stories of entrepreneurs who build billion dollar businesses from nothing. That wasn't what he did.
He worked a good job and made a decent living to put me through college and to put food on the table. But he didn't make a killing yet he enjoyed life. And he was able to invest in the stock market and the GE holdings that he had really grew. by the end of his life, know, starting, starting with nothing, he had amassed a sum that was, you know, able to allow for a comfortable retirement for him and, you know, and to provide for his family as well. So to me that was the American dream. And he talked to me quite openly about budgeting and money and estate planning. He was very open about it.
Pamela (21:05)
That's wonderful. You were very fortunate and what a story of success.
Gordon Haas (21:09)
Yeah, and I hope to model that with my children as well, because I do fear that a lot of people are hesitant to speak between generations honestly about what they have for whatever reason. And I just hope people are a little bit more open to having those discussions before it's too late.
Pamela (21:27)
When you join someone's team with their life planning, do you get them on budgets so that they can meet retirement goals?
Gordon Haas (21:38)
Yeah, so again, like a fingerprint, everybody is completely unique. I've done a lot of financial planning engagements at this point, and I have yet to see two families or individuals that have the same situation. Some people come to us with Excel spreadsheets, and they're right on top of everything as far as budgeting is concerned, and they've never missed a credit card payment. And obviously those people we work with on other issues such as higher level tax planning, estate planning, investments, things along those lines. But then there are some people who come to us and they say, listen, I've never been able to wrap my head around budgeting and I always have trouble figuring out where to put my money and when to pay for what. And then we have to get a little bit more into the weeds on the individual budgeting issues and push off the other topics until a little bit later in the engagement.
Pamela (22:32)
How often do you touch base with your clients to make sure they're on target, on task?
Gordon Haas (22:38)
Yeah, in the beginning, it's a lot of meetings. It's a lot of back and forth because again, it's making sure that we fully understand the situation. So it's gathering the data. So we meet probably either weekly or bi-weekly in the beginning when we're first working on the plan. But then once we've done that initial process, then it's quarterly. I'd say we talk about different topics quarterly and it's whatever the clients want. Some people don't want to hear from us that often and that's perfectly fine. We can meet whenever and wherever they'd like.
Pamela (23:13)
Can you tell me if it's truly possible to still lead a fun, spontaneous life and still plan financially for your future?
Gordon Haas (23:25)
Yeah, absolutely. And that's where having a partner like a planner comes into play. Because we, the people who in this field, the planners that I work with and myself, sometimes we're accountability partners. Where just the mere fact that we're highlighting an issue, whether it's a budgeting issue or something else, that helps people make decisions and stick to a course.
And on the flip side too, sometimes we have clients who are overly conservative. They are approaching retirement and they've made money all these years and they feel comfortable spending at a certain level. Then all of a sudden they're in retirement. And even though all of our projections are showing that they're absolutely fine and they can spend a certain amount a year and go on those trips and do all the things that they'd wanted to, they all of a sudden get nervous about it. So sometimes we give them the confidence as they approach retirement or in retirement to actually live the life that they had dreamed.
Pamela (24:25)
Gordon, when did you realize you had an interest in finance?
Gordon Haas (24:29)
Always. I've always been interested in finance. My father, when he worked at General Electric, he worked in finance over there. And I liked the idea of understanding finance early on and even before high school, I would follow the stock market and look through the pages of the newspaper to see how stocks were doing and listen to the various business news hours. So I've always had an interest in how businesses work and finance and specifically investing in the stock market. But once I decided to leave the toy industry, I decided that finance was just a perfect match for me for a bunch of different reasons. First of all, I enjoy making a difference in people's lives and being able to explain these things that some people think are very complex. So hopefully they'll understand it to educate people.
I just feel that it makes such a big difference in people's lives over the long run.
Pamela (25:28)
Does being a cancer survivor and a heart attack survivor inform your decisions and perspective when you guide clients in finance?
Gordon Haas (25:41)
Yeah, absolutely. Because I've been through the wringer as far as situations like that. I know that we don't all live forever. We're not all guaranteed a long future and we should live for today. I also got a lot out of it as far as giving back. So I do have a special interest in working with clients and families that have chronic illnesses or loved ones that are facing chronic illnesses because there's so many aspects of dealing with that type of situation from the shock to just knowing where to go for resources as far as medical or financial and support and things along those lines. And I've been through every step of that and like to help people navigate through that as well.
Pamela (26:33)
Gordon, you just mentioned families with chronic illness. Can you speak to an example of that from your own personal experience?
Gordon Haas (26:44)
Sure I can speak to an example very close to home. Unfortunately, my mother-in-law, my wife Monique, her mother was diagnosed with Alzheimer's about 15 years ago. just watching Monique be there at every step of the way for her to support at the various steps of the disease has been really inspirational and educational for me too as a planner. So early on, her mother was able to get on some medications that were able to slow the progress of the disease. But then each step and progression of the disease has robbed her of different capacities, but Monique has been really on top of it and involved with making sure that she was supported each step of the way according to her wishes. And that was making sure that she was able to live at home safely as long as possible. And then getting certain aids to come in and organizing all that, having certain organizations that she was able to participate in and social groups. And then eventually when it got to the point where it was not so safe for her to be living at home anymore, evaluating the best assisted living facility for someone in her mother's situation. So I've seen her go through all that and I've tried to be as supportive as possible.
And it's certainly not easy because it's really a long haul and it's very different than dealing with a situation, for example, like my father or my mother who passed away fairly quickly in comparison. There's just a lot more planning that's involved with an illness that takes this long to work through.
Pamela (28:33)
Do you find that your training as a CERTIFIED FINANCIAL PLANNER® came in handy in guiding your wife with her navigating her mother's disease?
Gordon Haas (28:45)
Yeah, her mother had been able to accumulate enough savings for retirement. And it's always a question of when something like this comes up, an illness, it's very, very expensive to get care. And Medicare does not cover Alzheimer's care. So we have to be very careful about how to have her pay for the various services and there are certain.
Pamela (29:10)
Excuse me, excuse me.
Medicare does not cover the condition of Alzheimer's. I'm sorry to interrupt you, but what?
Gordon Haas (29:18)
Well, let me clarify on that. So of course they cover medication and if there's any sort of hospitalizations, those are covered. But no, the extra care that she needs, again, at home to help take care of herself and make sure that she's safe, that's not covered. And assisted living, I'm sure that we all know in this country, assisted living is not covered as well, except for people who are on Medicaid and can't afford it. But yes, you do have to prepare for that.
Pamela (29:51)
Are there plans that you can advise clients on where in the event of a diagnosis like that,
Gordon Haas (30:01)
You pretty much just hit the nail on the head on what I'm hoping to get in these conversations. So rather than getting to the details right now, we're going to invite various guests who are experts and things along those lines on Medicare and social security so that we can really dive into the numbers and hopefully a easy to understand way.
Pamela (30:22)
Gordon, what does retirement look like for you?
Gordon Haas (30:26)
Good question. All this talk about retirement, I guess I should start thinking about it myself. And I don't think I'll ever retire. I can't really imagine what retirement looks like. And one of the reasons why I decided to join the world of finance and specifically be an advisor is I am pretty much running my own business, which I've always been entrepreneurial and I enjoy the freedom of running my own business. But obviously, there's also responsibility. But with that, as I build my business, I also can scale back. So when I get to a certain point, if that's 65, 67, 70, what I don't have a specific number, but whenever I get to that point where I feel like it's a little too much and I want to scale back, then, you know, I can certainly bring on other people on the team to take over some of the work and still work with various clients. So I don't envision retirement as far as stopping to work cold turkey. I hope to always be engaged and I love the learning process. I love helping people. I love working with people. yeah, don't know when I'll retire.
Gordon Haas (31:51)
Well, thank you so much, Pamela.
Pamela (32:07)
Well, thank you for creating GenRelational wealth, even though it's a tongue twister. I think the title hits the nail on the head.
Gordon Haas (32:18)
Keeps you on your toes. Well, thank you again, Pamela.
Pamela (32:20)
You got it, Gordy. Gordon, you've got it, Gordon.
Disclosures (32:24)
Gordon Haas is a Financial Planner with, and offers securities and investment advisory services through LPL Enterprise, a Registered Investment Advisor, Member FINRA/ S.I.P.C., and an affiliate of LPL Financial.
LPLE and LPL Financial are not affiliated with GenRelational Wealth.
The opinions voiced in this podcast are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which strategies or investments may be suitable for you, consult the appropriate qualified professional prior to making a decision.
Pamela Strell and her company are not affiliated with or endorsed by LPL Financial or GenRelational Wealth.
Individual tax and legal matters should be discussed with your tax or legal professional.
Prudential Advisors and GenRelational Wealth are not registered as a broker-dealer or investment advisor.
There is no assurance that the techniques and strategies discussed are suitable for all investors or will yield positive outcomes. The purchase of certain securities may be required to effect some of the strategies. Investing involves risks including possible loss of principal.