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- [00:00]
A
Foreign this is the Rational Reminder podcast, a weekly reality check on sensible investing and financial decision making from two Canadians. We are hosted by me, Benjamin Felix, Chief Investment Officer, and Ben Wilson, Portfolio Manager and Head of M and A at PWL Capital. Welcome to episode 377 and Ben Wilson, welcome back to the podcast and welcome to your first episode as a co host.
- [00:30]
B
Happy to be here. It's been a fast track from being a guest one week, co hosting this time, but up for the challenge.
- [00:37]
A
As listeners know, we usually have some combination of me, Dan and Cameron co hosting, but Dan and Cameron were not available and Ben stepped right on up.
- [00:46]
B
Happy to be here.
- [00:47]
A
We have some good topics to cover today. I have a quick couple comments on the recent OneDigital announcement. I'll explain what that means in a second then. Our main topic is investing in your health, which is a topic that is quite important to me and Ben, you've got some good things to add there based on your wife's background in healthcare. And then you've got a great topic on. We're calling it an M and A topic in our notes, but I think it's a very relevant topic for both any advisors that are listening, but also for any investors who may have an advisor who are listening. It's about what questions should you ask your financial advisor about their succession plan. So I think that'll be a really good discussion.
- [01:27]
B
I view it more as a M and A adjacent topic. It's important for any clients to know about their advisor's succession plan and we'll get into why later.
- [01:36]
A
Yeah, and you put some great questions together. I think clients of advisors should really be thinking about and advisors should really be thinking about whether they actually have good answers to these questions. So I think it's a great topic.
- [01:46]
C
Absolutely.
- [01:47]
A
We've got some quick comments at the end on the meetups that we had on the west coast of Canada and Cameron's wild plans for 2026 and remainder of 2025 meetups. So we'll get there in a second. So I want to start with OneDigital's recent press release, which was picked up by lots of media and by the Rational Reminder community who had a little bit of a panic until I calm them down. That's why I want to bring it up on the podcast though. On September 19, OneDigital announced a majority investment from funds managed by Stone Point Capital and Canada Pension Plan Investment Board, or CPP Investments. That transaction valued OneDigital in excess of $7 billion US dollars and they said in the press release that this investment will support the company's continued growth through a combination of organic expansion and strategic acquisitions. For anyone who's listening that is not aware, OneDigital is an American firm that bought PWL in January of 2025 earlier this year. Regular listeners will be aware because we talked about it on the podcast and had their co founder Mike on to talk about why they wanted to acquire PWL and what their plans are for Canada. So Stone Point Capital and CPP Investments bought shares in OneDigital from existing shareholders.
- [03:09]
B
So.
- [03:09]
A
So Onex Partners and some of the other previous owners of OneDigital's equity sold to this combination of Stonepoint and CPP Investments. Onex, which was previously one of the very large shareholders of OneDigital, they sold a chunk of their equity, but they will still remain a significant minority owner in the firm. So this transaction was a big deal. I mean, $7 billion valuation for a private company, it's no joke. I think it's great news for both PWL and for onedigital, and I'll explain why I think that in a second. The reaction of the RationalMinder community was very mixed. I wasn't going to post it there because I was like, whatever. This is pretty inside baseball news. I figured we would talk about it on the podcast like we're doing now, but I can't remember where I was. I think I was in Toronto for a conference that I was speaking at and I wasn't on my phone. At the end of the day, I got back to my hotel room and opened up the RationalMinder community, as I do, to see what's going on in there. And there's a thread that somebody had posted this news. There was a lot of pessimism and worry and assumptions and I'm just like, oh man, are we doing this again? So I went in there and I responded. I want to just kind of address some of those concerns because if people in the Rational Reminder community had those concerns, I'm sure other people did as well or do as well. So try and explain what actually happened and what it actually means.
- [04:29]
B
I think based on what I've heard and read in the community myself, is that a lot of this reaction comes from a lack of understanding. And there's a lot of questions that could be asked to better understand it. But at face value, it could understand why people would be confused and pessimistic. But to us, as we're going to get into, it's a pretty exciting Canadian story and probably the best outcome for PWL directly.
- [04:55]
A
I know the RationalMiner community is a semi anonymous form. It is anonymous if you choose it to be. Some people do use their real names. It's anonymous and people can say whatever they want behind the mask of anonymity. I think it's a good thing to seek to understand and ask questions rather than start throwing out wild speculations and almost even accusations. That's my dream that everyone would be like that in anonymous online forums. Probably not going to happen.
- [05:22]
B
Pretty serious pipe dream that you got.
- [05:24]
A
I know I can dream. The first thing to understand is this was a secondary market transaction. Existing private equity, like third party investors sold their equity or some of their equity to new investors. It's just a normal thing. Some of the private equity owners of OneDigital's equity were ready to sell, which is a regular thing that happens in the private equity world. And these two new investors, Stone Point Capital and CPP Investments, they stepped in and they bought the shares of these other shareholders that wanted to sell. One of the reasons that we thought this was really good news is that a large portion of OneDigital is now Canadian owned between OneX, which was previously a large shareholder, and CPP Investments, which is one of the new large shareholders. And then obviously the folks at PWL who are Canadian also own shares, but were a tiny little drop in the bucket compared to those other guys. When we did this transaction earlier this year, there was a lot of worry about American ownership. It was the height of Canada US tensions too back then. So it wasn't great timing on our part. But I think that this increased Canadian ownership is great news and more diverse. Two big Canadian investors is good news for us as a Canadian entity owned by this parent company. The other thing that I love here is that CBP Investments is one of the most respected investors in the world. We did know that there would be a recap. This is one of the wild pieces of speculation that was in the Raft reminder community was that Ben and Cameron thought they did their due diligence, but they were caught off guard by this. It's like, no, we knew this was going to happen.
- [06:57]
B
Yes, it was very transparent right from the beginning. And we knew it was even likely to happen in this first calendar year.
- [07:04]
A
Because it's a normal thing that happens. They had private equity investors and usually every three to five years private equity investors turn over their investments. They want to sell all or a portion of their investments to free up capital, to make new ones or return capital to shareholders or private equity fund investors, I mean, or whatever. So they were transparent with us about this that there would be a recap likely within the 2025 calendar year. So that was not a surprise.
- [07:28]
B
And it's actually good news for employees because in this private equity world, employees don't have liquidity otherwise. So these recapitalization events give people the opportunity to sell equity if they so choose. I think most, if not all, PWL shareholders plan to hold their shares into the future because they believe in the mission and the vision of where we're going. But it provides liquidity opportunity, which is exciting for anyone that's nearing retirement, for.
- [07:58]
A
Example, and it gives you evaluation. Like a market tested valuation.
- [08:02]
B
Exactly.
- [08:03]
A
If you don't have a transaction for five years, you kind of think you know what you're company's worth and what your shares are worth, but it has not been tested by the market and this is a market tested valuation now. So, yeah, I agree, that is good news. And I can also say that I'm not selling any of my shares and nobody that I've talked to at pwl, including Cameron, are selling any of their shares at this recap. But to your point, Ben, a recapitalization, that's what these are called in the private equity world, a recap is typically an opportunity for shareholders who want some liquidity to sell some of their shares. It is good news on that front. Now, CPP Investments is one of the most respected investors in the world. We've talked before about their investment philosophy and their returns and all that kind of stuff. And that's stuff that I think is interesting to continue to scrutinize and analyze. But we can say what we want. They are objectively one of the most respected and one of the largest institutional investors in the world. As I mentioned before, we knew that this recap was coming and Cameron and I, we would say to each other, like, man, can you imagine if CPP Investments is the one who funds or who buys shares in the recap? How cool would that be? We were honestly so pleasantly surprised that they actually were one of the big investors that came in. It was a little bit of a dream come true. Even though that's kind of a funny thing to say, but we'd literally be chatting like, man, can you imagine if it was CPP Investments? He's such a great story. Here we are.
- [09:25]
B
And I don't know how much influence Cameron had, but I'm sure he mentioned that to Adam and Mike. And even if it was a small piece of influence. It's pretty cool that OneDigital believes so much in the PWL story that they're like, yeah, this makes sense. This strengthens our Canadian journey as we grow together as a company. That in itself is very cool.
- [09:46]
A
Totally. And I was not in the room for those conversations, but I think that may have played some kind of role and it definitely does make our Canadian story that much more interesting with respect to our relationship with OneDigital. The other thing I want to say is that recapitalizations, recaps are a totally normal part of private equity ownership. I heard that there were words in the Raschminer community discussion about this, about hot potato ownership and I don't know other derogatory stuff like that about changes in ownership. But this is a thing that happens. Mike told me that. And this is easily verifiable online. This is OneDigital's fourth time doing a recapitalization like this over the last 25 years. It is a thing that happens when you have private equity ownership. It's an event that allows investors in private equity funds to take proceeds and also have the option to roll back into the investment if they so choose. If they like it, which onex is doing. Onex is not fully exiting because they still believe in the company and the story. I also want to say, and this is another thing that was mentioned in the RationalMiner community, someone was speculating that based on the ages of Mike and Adam, that this was probably a transaction for them to exit the company. That is not the case. That is not what is happening. Mike and Adam are not retiring. They're as fired up as ever. We talk to them frequently. That was not a motivation for this recap. This changes nothing for PWL's business. We're nine months in now to our transaction with OneDigital and clients, new clients, advisors, advisors that we're talking about. Having joined pwl, talk to anybody and they will agree with me that nothing has changed for the worse since our transaction. All of the fears that people had. I know it's only been nine months, but still it's been a great experience. OneDigital has been everything that they told us they were and more. They've been great partners. It's all as rosy as we expected it to be when we did our due diligence.
- [11:38]
B
And I think some of the fears that people express about private equity is that private equity firms are going to come in and apply sales pressure, increase your margins, guide how you're running your business. OneDigital's track record speaks for itself. They've done over 260 acquisitions in the last 10 years. They are seeking private equity partners that want to walk alongside them and give them the authority to run the business. How that makes sense to One Digital and that is how they have approached the partnership with pwl. They have very much stayed true to the partnership. To say we're acquiring pwl not because we've got it figured out, but because you've got something really great going on here in Canada and we want you guys to lead the growth. And that has continued to be true with the gasoline that we could put on the fire of the growth that PWL already started, which is exactly what's.
- [12:29]
A
Been happening exactly to a T. That has been our experience. There's super exciting stuff coming down the pipe for PWL as a company. Okay, just a couple more comments on this. This transaction, the fact that they were able to get investment from these two highly respected Stonepoint is specialized in this space. Specifically, CPP is obviously just a massive investor that does high quality due diligence on their investments. This transaction is a testament to the quality of OneDigital's business. It's also interesting that this transaction happened at a time that's otherwise pretty tough for private markets. There's a lot of stuff flowing around the media right now on just how challenging it is for private equity financing. So the fact that they were able to do this deal without taking a big markdown or anything like that or a big hit to valuation from two investors that objectively do serious due diligence speaks volumes about the quality of OneDigital's business overall. In my opinion, this is unilaterally good news. I'm super excited about the fact that they attracted these two investors. It was a bit scary, honestly, as a shareholder going through the recap process, because we kind of hear little bits and pieces of what's happening. We heard that it's a tough private equity market. We didn't know who the new investors were going to be. We didn't know if it was going to be successful. We didn't know if we were going to take a valuation hit, all that kind of stuff. I think this is just great news. It's a good thing for everyone involved for the new investors, for One Digital as a company, for remaining shareholders, including us, and for PWL as a Canadian subsidiary of One Digital, it's all good news.
- [14:05]
B
I would just reiterate that we don't expect this to have any impact on the client experience or the team's experience. If anything, it's a greater vote of confidence in what we're already building, which could lead to more and more success in us running the business. How we continue to choose to do so.
- [14:24]
A
That's the other thing. I had dinner with an advisor who we've been talking to about joining PWL recently. After this news had come out and he brought it up, he's like, how cool is that CPP news? This makes it such a better story for me to go and tell my clients about the ownership structure of PWL and One Digital. Just having CPP in the mix there I think is really cool as part of the story.
- [14:45]
B
Agreed 100%.
- [14:47]
A
So there you go. All good news. As always. We're happy to hear from any advisors that want to be part of that story, and likewise any retail investors or institutional investors who are interested in working with PWL as a client. We're happy to chat all right, let's jump into the main topic.
- [15:03]
B
Yeah, sounds good.
- [15:09]
A
So I've titled this topic Investing in your Health. Spent quite a bit of time working on it. Hopefully people like it. But yeah, I'll just jump right into it.
- [15:16]
B
It's a bit of a different flavor of topics you typically go into, but I think it's a pretty cool, interesting topic with parallels to what we do in investing and financial planning.
- [15:28]
A
It is different, but I look back on the episodes that we've done on I did one on investing in happiness. I've heard from so many people that that is one of the most impactful. We did that in the paper and a few guests I guess, around that topic, but that is consistently one of the most impactful things we've ever done on the podcast. So this is a little different from that, but it's conceptually the same idea. There are other things other than investing in building a larger portfolio that you can be investing in and really think about what are the most important things. You do need wealth in order to fund other stuff, but investing in your happiness and your mental well being is one of the best things that you can possibly do. You don't want to be unhappy and rich and investing in your health, which is what this topic is about. I don't know what else is more important than that. If you're not healthy, it's hard to be happy. It's hard to enjoy your wealth if you have it. And if you don't have wealth yet, it's hard to accumulate it. If you don't have your health Being financially independent, feeling financially secure, and being able to spend leisure time with family are some of the most common financial goals that people have. And that's from our Goals survey that we did whenever that was a couple years ago. But an often overlooked precondition for achieving these goals is being alive and healthy. Achieving longevity and good health is a lot like investing There are a lot of parallels. Like you mentioned, Ben, both health and wealth compound over time, making small incremental improvements each day, like saving in the case of investing, or exercising in the case of health as one example. Highly consequential in the long run. So there's these small little things that you do day to day, but they compound and they have major long term effects. Compounding also means that starting earlier is better than starting later. And it also means that if you start too late, there's not much you can do to improve the situation. If you don't save and all of a sudden you're 60 years old and have no money, there's not a whole lot you can do because you can't get yourself out of that. You needed compounding to help you to get the position you wanted to be in. Likewise for health, if you wake up and you're 60 and you've got heart disease, it's hard to reverse that. You're kind of stuck. But small incremental improvements along the way could have avoided it altogether.
- [17:39]
B
Important note that I noticed as I was reading through the notes for this podcast is that a lot of your examples focus on physical health and the parallels to investing. But I think there's other aspects of health that are just as important, like your mental health, which could include your healthy marriage, your spiritual health, if you're faith based individual. There's many different layers to this and if you don't take care of any one of them, it could lead to erosion in other parts of your life, including your physical health and possibly even your financial health.
- [18:11]
A
Yeah, totally. I do reference mental health a couple times, but you're right, it's not a focus. And that is a really important point. I do want to say upfront before we get into the meat of this topic that I'm a lifelong athlete. I played pretty high level sports and still play a lot of basketball and lift weights and ride my bike and all that stuff. But despite my personal interest in these topics, I'm not a medical professional. So one thing I did to make sure that all the stuff in this video is accurate is I had Dr. Mark Soth review the script. He's A physician with multiple specialties who's also an associate professor in the Department of medicine at McMaster University here in Canada. And he's also, as Moneyscope listeners will know, my co host on the Moneyscope podcast. And then I also had Dr. Sam Hetz, who's a physician who runs a longevity focused medical clinic in Ottawa called Lifespan, Maryland. So he's obviously very well versed in the longevity aspect of health decision making. So he also reviewed the notes. Any errors or oversights remain my own for sure, but I think between those guys reviewing it and my own reading and knowledge, I'm pretty sure we're not sharing anything too crazy here.
- [19:19]
B
I am by no means an expert either. The most insight I get is from my wife, who's an occupational therapist. And hearing her stories of working with different clients over the years makes sense.
- [19:31]
A
Now as listeners know because we've talked about on the podcast. This topic is particularly important to me right now because I was diagnosed with testicular cancer in January of 2025 of this year. I am down to one testicle, but listeners will be happy to know that as of a couple weeks ago or a few weeks ago at this point I was cleared at my 9 month check in for a CT scan and blood work looking for tumor markers. So I'm still good nine months in. Hopefully it remains that way.
- [19:58]
B
Fantastic, dude. Some big stress off your shoulders for sure.
- [20:03]
A
Yeah, every time there's one of those check ins the stress goes down, but then in between check ins it goes back up.
- [20:08]
B
Yeah.
- [20:09]
A
Testicular cancer is the most common cancer in men who are age 15 to 35, which is like a massive overlap with our audience demographic. So it's not actually that awkward anymore. But it used to be a bit awkward talking about my testicles or my testicle. Excuse me, but I do think it's important to talk about if your balls don't feel quite right, get them checked out. That's what I did. They just didn't feel quite right. Hurt a little bit, felt a little heavy, went and got them checked out, then sure enough, it had to go. Since we have talked about this on the podcast a few times, it's actually pretty crazy. There have been a few people who have reached out to tell me that hearing me talk about my testicle. Testicles, Testicle. Depends on when you listened, I guess prompted them to go and get theirs checked out, which ultimately led to their own cancer diagnosis and treatment and all that stuff. That to me is crazy that people were listening, heard me talk about this, went to their Urologist or their doctor, whatever. And it turned out they actually did have cancer. And listening to us talk about it, could it change their life, save their life? It's wild, but also makes it very much worth talking about openly. I think most people are familiar with the concept of lifespan, how long you can expect to live. We talk about that a lot in financial planning. What should we project out for a lifespan when we're doing a financial plan? But I think people are less familiar, although maybe more and more they are, but generally less familiar with the concept of health span, which is how long you can expect to live in good health because you can live to be whatever, 95, but spend 15 or 20 years in poor health. Ideally, you want to extend your lifespan, but also your health span and keep those two things as tight as possible. Achieving financial independence is a great goal and it's a necessary goal, but it's worth a lot more. Financial independence is worth a lot more if you're able to enjoy your financial independence in good health and for a long time. Interestingly, there does seem to be a relationship between wealth, lifespan and healthspan. People with higher incomes and more education do tend to live longer. And those data are pretty pervasive anywhere you Look. There's a 2019 study using US and UK data that finds that people in the lowest income group could expect at the age of 50 to live seven to nine fewer years in good health than those in the richest group. 2018 study found that Americans who maintain healthy lifestyle factors including not smoking, having a healthy body mass index, doing at least 30 minutes per per day of moderate to vigorous physical activity, having moderate alcohol intake, and maintaining a high quality diet score, tend to live longer lives. So I think studies like those do suggest that it is possible to invest in both your lifespan and your health span, but it's not always super easy to do.
- [22:48]
B
And even if you are investing in your lifespan and health span, we've seen real client stories where they spent their life working hard, get ready for retirement, and then all of a sudden they're diagnosed with a critical illness that completely derails their plans. So there's also got to be this balance. Don't work your whole life just to retire. Enjoy your time now as well, because you never know when something could happen along the way.
- [23:13]
A
Also very, very true. I think I have notes on this later, but it's another really important point. It's like you can do all the right things and it doesn't mean you're going to get a good outcome, but doing the right things can improve your expected distribution of outcomes. There's, I think, an investing analogy in there too. I'll come back to that later. So I do think those studies I just mentioned show that it is possible to invest in your lifespan and your health span. And to further the investing analogy, we talked about compounding earlier with respect to both health and investing. These little incremental changes each day can have big long run impacts. The incremental and then exponential nature. I mean, I guess it was exponential the whole time, but at the tail end of the exponential function. The nature of compounding makes the effects in both cases sneak up on you. If you don't save for retirement, you wake up one day with insufficient savings and insufficient time to fix the problem. And then health is similar where eating well and exercising might seem like a hassle or they might be a little bit unpleasant day to day, but then bam, you wake up with heart disease in your 50s or your 60s or whatever. There's not much that you can do at that point. The damage has been done. So I think in both cases, starting early and making small adjustments can have really big long term effects.
- [24:28]
B
I think there's a cool parallel there between active and passive investing. If you think about passive investing, it's sometimes referred to as the boring way to invest and the boring way to get good health is to just do regular exercise, a healthy diet, do all those things. Whereas there's a lot of health fads out there. Like, well, if you do this diet, you're gonna lose X amount of pounds really quickly. Or if you starve yourself for 12 hours a day, you're not gonna consume as much. But that's not a reliable long term solution. You might get some quick wins here and there, but it's not gonna result in consistent, good quality results over time.
- [25:05]
A
I think I actually have something similar to that analogy later on in my notes here. We'll come back to that. I agree with that. I talked to Mark Soth about that too. There's certain things in health that there's not a lot of agreement on, but there are also certain things that there is a lot of agreement on. I think I say later in the notes that it's like there's index fund levels of agreement on certain things that you can do. It's important to consider that human bodies are complex machines with lots of parts and systems that depend on each other. And if you wear one system down, whatever your cardiovascular system, the other systems have to work harder to compensate. And so the result of a small deterioration compounds into larger problems for the body's critical systems that eventually show up as something more catastrophic and irreversible, like heart disease. And importantly, the less noticeable preconditions that led to that catastrophic and irreversible outcome could have been mitigated if they had been addressed earlier, but people often don't realize that that's happening underneath the surface. This reality does hit people eventually, but often too late. Health and finances are some of the biggest regrets that many people have later in life. Based on the American Regret Project. That's from Dan Pink. In his book on regret, he calls health and financial regrets foundational regrets. These are regrets that stem from failures and foresight, responsibility and prudence with long term consequences. They're often related to small decisions that may be immediately enjoyable but have lasting negative effects that increase exponentially over time due to compounding exactly what we've been talking about. Some examples in finances are overspending and under saving and in health not exercising, smoking, drinking excessively and not eating healthy foods. Little things that seem pretty immaterial at the time, but then it's like bam. It hits you all at once. I think this speaks to another common ground between investing in health the importance of delayed gratification. Some people struggle to save for retirement because spending money now feels better than saving for the distant future, a future that's hard to imagine. I think health is similar. Exercising can be uncomfortable. The salad doesn't excite our body as much as a donut. I wrote that, but I don't know man. I actually really like salads. Donuts make me feel like crap immediately. But the long term benefits of exercising and eating well are for sure worthwhile, even if they're not immediately enjoyable exercise too. I love exercising.
- [27:20]
B
Sometimes getting the motivation to do it is hard, but once you do it, it feels great. Then the day or two after doesn't always feel great, but it's worth it.
- [27:28]
A
Oh, I love that feeling. If I haven't done a good leg workout in a while and I do one and I can't walk the next day, I'm like, oh yeah, I did a good job.
- [27:36]
B
It's good reassurance that you worked hard enough.
- [27:38]
A
Another common thread between investing in health we mentioned this before is uncertainty. Human bodies and financial markets are both incredibly complex systems, and I think in both cases there is probably some level of evidence to support almost anything that you want to believe. And while all evidence is not created equal, even the best evidence cannot predict the specific outcome that you're going to get Me, for example, I live a pretty healthy life and still lost a testicle to cancer. That may seem discouraging, but I think both in investing and health, there are certain things that most experts do agree will improve the distribution of outcomes. This is not stuff that guarantees a good outcome, but they do improve your odds. Like the investing analogy. To your point earlier, Ben, most experts in investing do agree that it's really hard to beat the market consistently. And I would say that most experts would not hesitate to recommend investing in index funds as a baseline sensible decision. There's some nuance around their recommendation and experts will definitely disagree on the best way to try beating the market if that is your goal. But I think it's hard to argue against index funds being a good starting point for most people. And then similarly, health experts disagree on a lot of things, but there is health advice that has index fund level agreement among medical professionals. My intention for the rest of this video is to describe some of those and hopefully allow listeners to enjoy their financial wealth for longer by being healthy.
- [29:05]
B
You're a good example of this. You model a pretty healthy life, but you have definitely gotten into some of these fad diets. I remember the all beef phase for a while and guessing that didn't spike you up since you're not doing that anymore. And there was a lot of cabbage for a while.
- [29:22]
A
Cabbage is very healthy. I have a very sensitive stomach. Apparently eating beef can be very therapeutic for your digestive system. I was also very hungry when I was only eating beef because your body needs more than what's in the beef. I've tried some crazy things. Thank you, Ben.
- [29:38]
B
Good an albit. Sorry.
- [29:40]
A
It's okay. I want to talk about some of the most reliable factors that can improve lifespan and health span. Exercise, nutrition, sleep, and mental health. Now listeners might hear that and be like, well, yeah, that's pretty obvious. I think doing those four things well is literally a superpower. I think it's fair to say most people are not doing well on all of those things. In his book on longevity, although I think he says in the book he doesn't like that term. But anyway, in the book outlive, Dr. Peter Attia says that exercise is the most powerful longevity drug and has the greatest power to determine how you will live out the rest of your life, which is a pretty powerful statement. Exercise delays the onset of chronic diseases and extends not only lifespan but also health span. One of the most powerful longevity markers that he talks about in his book related to exercise is VO2 max, which is a measure of the maximum rate at which a person can use oxygen. The data around this are pretty staggering. I think we all know that smoking is bad for you and that it reduces longevity. A smoker has a 40% greater risk of all cause mortality than someone who does not smoke. A 2018 study in the Journal of the American Medical association found that someone of below average VO2 max for their age and sex is at double the risk of all to cause mortality compared to someone in the top quartile. So that suggests that poor fitness carries a greater relative risk of death than smoking. Pretty crazy. I actually test my VO2 max every six months. It's kind of fun. I usually beat everybody else's high score and I always want to beat my own high score.
- [31:10]
B
Which is really the reason why you brought it up.
- [31:14]
A
To maintain and improve your cardiovascular health. Peter Attia suggests 3 hours per week or four 45 minute sessions of Zone 2 exercise is kind of the minimum required. Zone 2 is a level of exertion where you can still talk in full sentences but just barely. So that can be stuff like running, biking, swimming, any other physical activity that gets you into Zone 2 for a 45 minute interval. VO2 max is not the only important fitness related predictor of health. Muscular strength is also super important.
- [31:43]
B
Grip strength before you go to that. I don't know if there's any health basis for this, but in investing, if you panic, sell and move out of the market, try to time the market, it's probably going to have a negative impact on your returns. Similarly, while you're in your healthy habits, if you are working too hard or skip workouts here and there during like stressful periods of your life, that is probably going to undermine progress and put you steps backwards. So it's better to remain consistent even during some of the tough stressful times. And I'm guilty of that myself. I need to do better of that in my own life. When things get busy at work it's hard to maintain that routine. But I try to get out and play sports a couple times a week and need to get back into weightlifting at home as well.
- [32:31]
A
My quick hit exercise is pull ups. I have Olympic rings in my garage and I'll go and try and knock out. I always try and do one more than I did last time. Try and do some number of pull ups. I think I did 13 today. The most I've ever been able to do is 18. That was a while ago and then I fall off for a while. But anyway, if I go and do something like that it's like a really vigorous, quick workout. Even if I only have a couple of minutes, I feel this release of stress and mental clarity. It's super important. Even if you just have a couple minutes to do something is my experience.
- [33:00]
B
Yeah. Jordan Tarasoff on our team, we've talked about this often. In times where I haven't been doing as much, we compare notes. And one comment that's always resonated with me is doing 10 minutes a day is exponentially better than zero. So even if you can only do a little bit, it's better than doing nothing.
- [33:15]
A
Yeah. I've got a fan bike, a Schwinn Airdyne bike in my garage, too. And that's another thing that in the evening time before I go to bed, I'll go and knock out a quick 20 minutes on the bike. And it similarly makes me feel so much better, it makes me sleep better. I think I have notes on that in a sec. Okay, so VO2 max is important. Grip strength, in particular, interestingly, is a very strong predictor of longevity. But maintaining muscle mass just more generally is increasingly important with age because it tends to start to decrease as early as our 30s. I'm 37. So here we are. Muscle loss can lead to frailty and injury later in life, which of course, shortens both health span and lifespan. That's another interesting thing, is those two things are related. Like if you become unhealthy and immobile, that inherently shortens your lifespan because you cannot do the things that improve it. Peter Attia, he's actually got a bit of a financial background. He spent a little bit working in finance, so in his book, he actually also compares strength training to retirement savings. We want to retire with enough money saved up to sustain our retirement spending. And we similarly want to build up enough muscle mass and bone density to protect us from injury and maintain our ability to engage in enjoyable activities as we age. But like investing, it's much easier to accumulate muscle mass and strength by starting when you're younger and allowing those gains to compound over time. Exercise relates directly to personal finance and not just from an analogy perspective, because it costs time and often money to exercise. But I think by increasing your health span and lifespan, it also allows you to work and earn an income for longer. So these things are very interconnected.
- [34:49]
B
If you start saving at 45, 50, 60, you're going to be much worse off than someone that even if they start a little bit early on in their 20s, it's going to take a lot less effort later on. In life to have a good quality financial retirement. Same thing with health. If you have little incremental improvements over time, theoretically is going to make it easier as you get older.
- [35:14]
A
Totally. And starting to try and build muscle when you're in your 70s or 80s is presumably a lot harder than going into that age with a good base of muscle mass.
- [35:23]
B
That's true, although I have no personal experience in that area.
- [35:26]
A
Neither do I. There's also studies on how exercise may make you more productive at work. I anecdotally firmly believe that and totally agree with that based on my personal experience. To be clear, that comment was based on a study, but I'm saying that my lived experience is similar, which is interesting too. If you're more productive at work and you can earn a higher income, that's another way that health and finances can be connected. Investing in exercise can be any purchase or expense that gets you moving, ideally outside. I have spent more money than I want to talk about on stuff like my mountain bike and my kayak and my custom length kayak pedal, which actually wasn't that expensive. Interestingly, I'm too tall for a regular paddle, so I got an extra long one. I've got a fancy hiking backpack that I shove a bunch of weights into so I can walk around in the forest with a heavy pack on. Peter Attia talks about that in his book. It's called rucking. It's very, very good exercise. Those are all activities that get me outside and in zone two and often spending time with friends and family, which is an added bonus. I pay for a gym pass where I meet a friend once a week to do a social. Like we're hanging out, spending time with each other, but we're also doing a heavy lift pushing each other. So those are all examples of stuff that I've spent money on to exercise and socialize.
- [36:40]
B
I do the same thing. I've set up a pretty sweet gym in my basement. Need to use it more but got full squat, rack, bench, got a dumbbell. So if I want to work out I can do a full workout no problem. And I try to get out playing sports once or twice a week. We both have kids, so trying to instill those healthy habits in kids. We actively pay for sports teams for our kids to be participating in. Not only is it fun, but it develops those healthy lifestyle habits.
- [37:11]
A
I do sports leagues too, but I also have a gym in my house. Like I mentioned my Olympic rings. I got a fan bike down there. I've got some dumbbells, I've Got a bench that you can adjust to incline and stuff. I have the one time a week where I'll go with my friend to the gym and then we're going to the gym together. And that's cool. But other than that, it's like having a gym in your house. It's so convenient. I guess if you have 20 minutes or half an hour, you can just go knock out a quick workout, and you don't have the extra 5, 10 minutes to get to the gym or longer, depending on where you live.
- [37:39]
B
Talking about the lack of motivation that I have to get into the gym, and this is kind of inspiring me to do it more. But having an accountability partner, like, the one time a week you go, makes it infinitely easier to get out there. And I think that's similar in finance if you're doing it on your own. We've had clients that have made bad decisions because they stress about market conditions. But working with an advisor, that's an accountability partner that can help you through tough times, help you make the right decisions to achieve your goals.
- [38:09]
A
We did talk about that once. We did an episode on who should hire an advisor. I don't know where it went, but there was an initiative at one point in the Rational Reminder community for people to be like accountability buddies, strangers from the Rational Reminder community, where it's like you'd pair up and do this, Keep each other accountable for savings rates and asset allocation and whatever. Not panicking. And I think it is a really interesting idea.
- [38:28]
B
It's worthwhile, for sure.
- [38:30]
A
Yeah. Having somebody to go to the gym with. You're going to the gym at that time because someone else is meeting you there. I think that's really valuable.
- [38:36]
B
Even this week or the past couple of weeks, my wife has started to get into a more regular fitness routine. She's doing it on her own, but she has this group of girlfriends, accountability group. They're all doing the same workout video and checking in with each other, like, oh, how did you do it today? My kids dropped out before the video is done, so I feel good about myself. Things like that. It's very motivating for her to have people working alongside her even if they're not in the same room.
- [39:01]
A
Yeah, that is cool. Investing in this stuff financially is one thing, buying equipment and things like that, but I think a big one. And we were kind of just talking about this is investing the time to get exercise. That's hard. I try not to stay in my office too long so that I can exercise, but it's hard, man. I'm working on something interesting and then it's getting later and later. That's a big thing. All this stuff's also connected where if I don't exercise, I don't sleep as well. I'll come back to that later. But then it feeds into everything else. You don't sleep well, then the next day you wake up and you don't feel so good. So it's harder to exercise and it's harder to eat. Well. I think I have a quote about that actually at the end of the notes here. But I want to go to nutrition real quick before we get to sleep. Nutrition is a wild topic. There's a thread in the RationalMinder community about nutrition and it's probably a more intense debate than anything about factor investing or anything like that in the community. I think finding the truth in nutrition is more elusive than finding the truth in investing. Different things work for different people. There's contradicting evidence for anything that you think you know. In Nutrition, for every PhD there's an equal and opposite PhD. There's people with opposing views who are both experts. Who do you listen to? What do you believe? Everyone has their favorite expert, like, oh, you've got to listen to this guy. He knows the truth, but then some other guy also knows the different truth. I don't know, man, I find it really hard. And I think another thing is that diets and the evidence supporting them come and go. And then a new study comes out and well, no, actually keto is not so good for you. Intermittent fasting is not so good. I don't know, all that kind of.
- [40:27]
B
Stuff seems like they go through trends and new research comes out all the time.
- [40:31]
A
Research in this space, nutrition space, suffers from some of the same problems as in financial economics research where a lot of the findings are correlational and don't firmly establish causation, which makes it really hard to draw predictive conclusions from. So a study might measure the correlation between two variables but not account for some unobserved third variable or multiple other variables that are actually driving the results. And again, bodies, just like financial markets are complex enough to make interpreting correlational data very difficult in a way that you can definitively say you should do this. Not that I don't think there is a perfect diet. Like you said, Ben, I've personally done all kinds of funny diets. Cameron loves to tell the story of when I used to eat a largely lentil based diet and had a lot of gas in the office. He still makes fun of me for that. I don't know if you ever got to experience that, Ben. I think that might have been before.
- [41:21]
B
Your time might have been before, but beef and cabbage wasn't much better.
- [41:26]
A
We talked about my testicles, now we're talking about my gas. This is good. Anyway, welcome to the podcast, Ben. I don't think there is a perfect diet. I am pretty comfortable saying that anything that dramatically raises your blood sugar, like juice or soda, is not great to consume consistently. Protein is pretty universally agreed upon as being quite important, especially if you want to maintain or increase muscle mass. Fresh fruits and vegetables with lots of fiber are also quite important. And I think most people would also agree that eating too much food too often is not good. That's not to say you need to be intermittent fasting, but being fully satiated for every hour of the day is probably not super good for your body. Another one that I think is hard to disagree with is that highly processed foods and literal poisons like alcohol, tobacco and drugs, avoiding those things is pretty sensible. I know all that's kind of inconclusive in terms of what you should actually be putting in your body, but beyond those broad principles, I don't think anyone really knows. Peter Attia talks a lot about this in his book as well. He says that the best nutrition plan is the one that we can sustain. And that makes me think of the famous quote from the Dimensional founder David Booth. He says the most important thing about an investment philosophy is that you have one you can stick with. I think for these two fields that are kind of full of conflicting evidence and both have lots of uncertainty about future outcomes, even if you have the best evidence, I think that's pretty good advice. You have to have something that's pretty good and pretty healthy or pretty well diversified and low cost, but you got to be able to stick with it. If you invest in index funds but you can't stick with them, then you're going to have a bad outcome. If you do some crazy diet that's not terribly unhealthy, but you can't stick with it and you end up crashing and eating a bunch of whatever sugar, then that's not going to work out very well either. So I like that idea of you've got to have something that you can stick with. Investing in nutrition can mean buying high quality foods and making sure that you either have the time to prepare them, which is a whole other big thing, or buying them prepared in a way that saves you time so that you can eat healthy foods. Personally, I get local produce as much as I can, and some prepared salads delivered once a week from this very cool service based in Montreal. I go to the farmer's market where I live usually every Saturday morning, get produce there and meat and eggs, all from local places. It's not open all year though. I don't drink alcohol, smoke, use drugs. I think a big part of avoiding those things is maintaining good mental health, which I've got some more comments on later. You mentioned that earlier too, Ben. I think a lot of those things end up being crutches for when mental health is not doing so well. But then that has this negative flywheel effect on your physical health, and it probably just makes you feel mentally worse in the long run.
- [44:18]
B
Mental health can have an impact for sure, but those particular examples, alcohol, smoking, drugs have a social status to them as well. So if someone is more prone to give in to what others are doing, even if you have good mental health, you might want to do it just because it's what the guys are doing or what your friends are doing every weekend. And that's a tough cycle to get out of.
- [44:43]
A
Yeah, true. Okay, so that was nutrition, the Benefits of Sleep so if we can say that nutrition is debatable in certain ways, sleep, I think, is less debatable. We need to sleep. It's important for brain health and function. And ongoing inadequate sleep, less than six hours a night, is associated with an increased risk of cardiac problems like heart attacks. Sleeping well is not easy. I don't know about you, Ben, but sleep is something I've always struggled with.
- [45:09]
B
I'm usually a pretty good sleeper, but with three kids that show up in your room in the middle of the night, interrupted sleep is not as good as a full night of six to eight hours.
- [45:20]
A
I've been pretty good recently, but I have at times in my life really struggled with getting good sleep. Investing in your sleep can mean creating a really good sleep environment. Dark as possible maintains a cool, comfortable temperature through the night. And then also good habits like maintaining a consistent sleep schedule is also really important. Drinking coffee or alcohol before bed is not so good. Bright screens, whether that's a phone or a tv, right before bed is not great. Exercise does help to improve sleep quality. I know that's true for me personally. If I've been slacking off at the gym, if I need a reminder that I have not been diligent about going to the gym, then I will have a terrible night's sleep and be like, oh right, I need to exercise.
- [45:59]
B
Except for right before bed. Sometimes you get that adrenaline that makes it hard to fall asleep initially, even if you get a better sleep overall.
- [46:05]
A
I don't find that. I mean, maybe I never work out right before I crawl into bed, but I'll often work out like 8pm and then chill out for an hour and a half and then I have a great sleep.
- [46:15]
B
I often play soccer from 9 to 10 at night and then come home then. It makes it tougher to wind down and fall asleep because your heart rate's going so fast.
- [46:24]
A
Oh, 100%. So I do play basketball Tuesday nights until 10pm I never have a good sleep after that. That's not good. I struggle with that one because I love that Tuesday night run. But I hate having every Tuesday. If I go to basketball, my sleep is terrible. I did go through a period a few years ago where my sleep was really bad. I don't know what was going on then. But I ended up doing this thing called cognitive behavioral therapy for insomnia. Cbti. It's a real evidence based thing that you can do. And sleep restriction. It's super not fun at all. It was actually brutal. I don't recommend it at all unless you're really struggling with sleep. But I did a program, a CBTI program. It did ultimately help, even though it was a couple weeks of serious struggle. Sleeping pills are probably not the answer to sleep. Using sleeping pills is correlated with shorter life expectancy. Interestingly, even if it results in the recommended six to eight hours of sleep, that's all contrary to hustle culture. I feel like hustle culture's kind of died now. But people used to brag about sleeping for four hours a night and drinking a lot of coffee. That's not a good idea.
- [47:32]
B
Yeah, it seems like the current generation good health is more trendy than not sleeping.
- [47:37]
A
I know if I have a good night's sleep, I am orders of magnitude more productive and happy and just feel better than if I have a poor night's sleep. So I think sleep, if you can get it, is a superpower. The last topic I have on investing in your health is mental health. Staying alive and healthy is not only about exercising, eating well and sleeping. It's about being happy and enjoying life. Living a long but unhappy life doesn't sound so fun. And interestingly, happier people tend to live longer. So there's an interaction there. Multiple types of evidence suggest that high subjective well being, life satisfaction, absence of negative emotions, optimism and positive emotions causes better health and better longevity. There's a study on a nationally representative sample of U.S. adults that shows that people who are not happy have a 14% higher risk of death over the study's follow up period than very happy people after controlling for marital status, socioeconomic status, census division, and religious attendance. It's pretty interesting. Telling people just go be happy is obviously not very useful advice. I think models like the PERMA model that we've talked about on this podcast before can help describe the factors that are related to human happiness. The PERMA model for people who are not familiar stands for positive emotion, feeling good, enjoying what you're doing, engagement, which is reaching states of flow by being absorbed in a challenging task that matches your skill level, maintaining strong healthy relationships, finding meaning, which is a sense of purpose beyond yourself, and accomplishment which is achieving valued goals. So doing those things are related to happiness. They describe what makes people happy. From the perspective of longevity, relationships do seem to be particularly important. The research based on the Harvard Study of Adult Development, which is one of the world's longest studies of adult life, has found that how happy people are in their relationships has a very powerful influence on their health. Stronger social networks more generally are also associated with longer lives. I think relationships, just like health and wealth, they also compound over time. Investing in relationships requires dedicating time and in some cases money to spend time with people that you care about. I think spending money on relationships can mean paying for activities done with friends, like my gym pass I guess as an example. Or making time saving purchases like house cleaning and meal delivery so that you can spend more quality time with people. This also shows up in the research on regret. Letting relationships drift apart is another one of the most common regrets that people around the world seem to have, which I think further affirms from a different angle the importance of investing in them when we have them.
- [50:15]
B
When you let relationships drift apart, I think it can negatively impact the other areas of health if you think of someone that lets their marriage deteriorate. For example, I've got a friend of the family that over time his marriage fell apart and I don't know many details but he was a successful guy from a financial perspective but all of a sudden his marriage fell apart, he has three kids that they've got a co parent and that impacts your financial health because you've got to split your assets. It impacts your mental health because you're probably not feeling great that your marriage just failed and you're not sure why and it may impact your sleep and what you're eating. It can be a downward spiral pretty quickly. I even just made a post about this this week. My wife And I went on a little mini getaway to celebrate our anniversary. And I think it's super important to invest in my marriage and relationship with family. Family is super important to me. It kind of shows up. I would view myself as a pretty happy, optimistic guy. And I don't know for sure, but the relationships have to be a big part of that. If I did not have that support system and healthy conversations, relationships with all those different people, it would be much more difficult even at work. You and I have been working together for over eight years and we've developed more of a friendship even though we're working together. Your sister Tessa now lives around the corner from me. We hang out all the time. There's many people at work that I talk on a personal level, connect that way, and it strengthens the relationship that you have with your colleagues as well.
- [51:52]
A
Totally agree with that. Those types of relationships are super valuable. That's one of the cool things about working with pwl. We've been very fortunate to surround ourselves with objectively awesome people that are easy to get along with and have a relationship with.
- [52:05]
B
Absolutely.
- [52:07]
A
And actually the last thing I want to mention is related to what you just brought up. Exercise, nutrition, sleep and mental health are not isolated areas of improvement. They're not isolated things that you can invest in or should invest in. They work together to improve your physical health and your cognitive performance. There's a book called the Ripple Effect by a guy named Dr. Greg Wells, Canadian. He argues that when we sleep better, we eat better. When we eat and sleep better, we move better. When we move better, we sleep better and we think better. So the idea is that all of this stuff creates a reinforcing cycle with obvious benefits to health and well being both now and in the day distant future. So to the extent that time and money can be allocated to encouraging or enhancing exercise, being deliberate about the foods that you put in your body, improving the quality of your sleep and boosting your happiness, I think you would be hard pressed to find a better use of those hours and those dollars. That's why I thought this was an important topic to cover. If you invest in your health today, your future self will thank you.
- [53:08]
C
Awesome.
- [53:09]
B
Can't really argue that health is a super important part of what it means to live a healthy life. Both physical health, mental health, financial health, marital health, spiritual health. As I said, all those different areas. If you can maintain as healthy of a mindset in all of those areas, then you are going to be better off.
- [53:31]
A
It's another one of those things. What are we doing all this for we talk about investing and minimizing your fees and having higher expected returns and having the right amount of insurance, all that financial planning stuff, which is important and makes a lot of sense. We had this realization years ago that that's cool, but from our perspective giving advice, we should probably also check in with people to make sure that they're doing stuff that's related to happiness. And I think health is very similar. What is the point of all of this if you're not going to be healthy to enjoy the wealth that you're creating?
- [54:03]
B
100% agree.
- [54:04]
A
All right, should we move on to questions to ask your financial advisor about their succession plan?
- [54:10]
B
This is a pretty interesting topic and not necessarily something that investors think about because it's not a natural reaction, especially if your advisor's younger. But did a bit of research, tried to get some demographics and there's a recent Global Mail article that stated that advisors over the age of 55 represent almost 40% of advisors in Canada and they manage about half of all AUM in revenue. Above that, advisors over 65 make up more than 11% and account for 14% of AUM. The statistic is pretty I would say it's surprising. I'm not that surprised. But it is kind of mind blowing that over 40% of the assets are managed by people that should effectively be retiring within five to 15 years, if not sooner. It's very important and relevant for many clients out there. What happens after your advisor retires? And even if your Advisor's in the 60%, anything could happen. They could have a health scare. They could have a number of events that change their trajectory of their career. If having a pre planned succession plan is important to not only the advisors but also to the client. If your advisor moves on, where are you left? So I thought it would be pretty cool to go through some good questions to equip clients to ask to better understand your advisor's succession plan. And if you're an advisor listening, if you haven't thought about these questions, now is probably a good time to do so because you ought to be prepared in case something were to happen. The first question I thought of is ask your advisor, do you have a formal documented succession plan? I think this is a super important question. Most advisors may not have a fully fleshed out documented plan. Probably very few have it actually written out on paper. But that doesn't necessarily mean it's a bad thing on its own. You want to make sure that advisors have actually started thinking about it and ideally Started talking to a potential successor. If your advisor indicates that they have a plan, they have an expected timeline. Learn more, ask them, share details. You want to hear that they're thinking about it. At a very minimum, if your advisor says I haven't really thought too much about it or I'll figure it out when the time comes, or I'm too young yet, I'll figure it out closer to retirement, I would consider that a pretty serious red flag. I've been talking to advisors that are close to my age that are already thinking about succession. I don't plan to stop working for 20 plus years, but if something happens, if they have a windfall, if their spouse falls ill, if there's some event that causes them to not want to work anymore, I would prefer to have some sort of plan in place as a client to know that my financial future is taken care of by someone that my current advisor knows and trusts totally. Some people may think it's prying on the advisor's plan, but I don't think it is. I think this is a question that is very fair and relevant for you to ask and can give you a lot of details about your future as a client in your own journey.
- [57:17]
A
I think it matters. The nature of this occupation is so intimately connected to the client's life and the client's financial decisions. I don't think it's prying. We know how much people rely on us for their decision making and the execution of their stuff and how challenging it could be for someone if we just disappeared. Not that we're going to do that. If we were a smaller operation and one of our advisors, whatever, could no longer communicate with their client. It could be borderline catastrophic for a lot of clients. I mean, in some cases, truly catastrophic. I think it is worth asking about for sure.
- [57:49]
B
Related to that first question, the next one that I think is relevant is what contingency plan do you have for unexpected events that come up? Someone that leads a normal life, goes toward their planned retirement. Theoretically they got lots of time. If they haven't figured out yet it's not the end of the world. But if something happens. We know of advisors that get diagnosed by cancer or someone gets hit by a bus or has a heart attack and drops dead. You want to know that your advisor at least has some sort of plan for the clients to be taken care of. Whether that's another internal advisor at their firm, whether it's a next gen, a younger advisor that's on the team being trained, maybe not fully capable at this point of leading the relationship, but they're there, know you have some idea of the plan or even we know of some advisors that kind of have what they call like a death pact. They're not part of the same team currently, but they're like, I know you, trust you, you've got a good approach. If I die, please make sure you take care of my clients. It's just a good safeguard to have. In the best succession plans, you're going to have a fully planned out. This is what my business is valued for. This is how I'm going to transition. I'm going to stick around for two or three years, but if something happens suddenly, it's a completely different game. The next step would be, let's say your advisor has identified their successor. I think it's fair for you to ask more details. Who is he? Who is she? Can I meet them? Can I learn more about their practice? And someone that gives you a strong answer would be like, yes, I have identified John Smith. He's going to be my successor. My timeline to retirement is five years from now. I'm going to start looping John in in two years. So I'll be there for the next three years to help transition. Transfer all the head knowledge about your file to make sure you're comfortable and build the trust. Whether that be again, someone outside the firm, a younger advisor that they're training, whatever that might be. I think as long as they're thinking and working towards a well thought through intentional plan, that's good. Weaker answer would be, haven't really picked someone yet, but it's going to be someone on my team or I've got someone, but we'll introduce you later. I'm not willing to take Looper in at this point. Be curious why they wouldn't want to engage them so early.
- [60:16]
A
You see it on the other side too from the younger advisor's perspective. There's many cases that you see where a younger advisor is told that they're in a success or position but no formal plan is put in place and then things end up falling through or they have a falling out. And that can be quite damaging to the young advisor's career because they could have been building equity and growing their book of clients elsewhere that could be related where if someone's non committal or whatever, then they may not be ready to introduce the person to clients. But it all ties back to your first point about having a formal plan in place. And that formal plan can include succession of the equity of the practice to a Junior person, which is a whole other aspect of this type of planning.
- [60:57]
B
How we kind of approach this at PWL is Cameron started, he wanted to find this like hundred year succession plan and that has kind of evolved to be a fully scaled team that continues to grow. We're now part of OneDigital, which is a great backing to support us. But if we look at what we call the diamond teams internally, in most cases an advisor is not meeting a client solo. In almost all meetings there's two people in that meeting and that's intentional for a couple reasons. That's to make sure everybody's getting good quality advice. We're not missing anything, but so that each client knows at least two people personally so we can build relationships as people grow in their careers, as people approach retirement. If something happens that there's going to be continuous relationship, continuous service regardless. And I think it's worked pretty well for us. And that's something that you want to see in your advisor, some sort of plan to make sure that you're going to get continuous, high quality advice no matter what happens. This may not be relevant for everybody out there, but it's pretty important to us. Does your successor share your investment philosophy and planning approach? I think this is a pretty key question. There's a lot of succession plans out there, don't necessarily consider this as a top priority. Some advisors are looking for top dollar. Some advisors are just looking for whoever's available or willing to buy the book, regardless of how they approach investing. If you sought out your advisor because you aligned with their investment philosophy, their planning first approach or something else, you probably want to have someone that shares a similar view on that. And if you leave it till the end and get surprised I was taking an evidence based approach or whatever the X is and you're surprised once you've transitioned over, you're probably going to have to scramble and find a new advisor that you align with on your own. As a client, that is very important and something that you want to dive deeper into as a client and as an advisor too. I would expect if I was on my own with my own book of clients, I would want my advisor to align with how I approach and have a very similar client experience. And I think most advisors that are kind of in our community feel the same way. That theoretically is important to most advisors in this space.
- [63:21]
A
One of the reasons it's important is that if an advisor sells their practice, if that's their succession plan to an entity that doesn't share the same investment philosophy and is profit motivated, which many parts of the financial industry are. I mean, I guess all of them are to varying extents. What can happen is that low cost evidence based client base can be shifted over into much more profitable, potentially proprietary products, which makes it possible for that purchaser to pay a higher multiple to pay more for that practice than somebody else would because they know how profitable it's going to be once they convert it over to the higher fee products. But that's obviously not good for the end client. So I think that is something that's worth asking about for sure. Exactly.
- [64:08]
B
Next question I had is what will the transition process look for me as a client? I think I touched on this a little bit already. But if they've got a succession plan in place, is it going to be a cold turkey handoff like I'm retiring in six months from now and then this is your guy going forward, or is it I'm retiring in five to 10 years and this junior or this new advisor is going to start coming in and gradually transitioning As a client, it's probably in your best interest to have someone work alongside your current advisor. Get to know you, get to know their approach, get to know your financial plan and objectives rather than you having to basically start at square one and re explain your objectives and your risk tolerance and all these different factors that are important in a financial plan. But that knowledge transfer is better to happen. Before your advisor leaves another question. What key factors do you consider when evaluating or mentoring successors? The question kind of goes beyond just naming a successor. It focuses on how future ready your practice is. The best practices probably plan for succession in house. A lot of smaller teams don't have that luxury. A lot of small lifestyle practices, your one man show or one guy plus an assistant or something like that. You kind of have to rely on an external successor. But if you've grown to a scale where you can hire an associate, that could naturally become your succession plan. I mean, it doesn't always work. My dad's a perfect example of that where he tried a couple different potential hires to join him that didn't end up working out for one reason or another. Over time you see that their drive is different or their personality doesn't fit. It's not always easy. You may not get it right the first time, but that's why it's so much more important to start early. If you're thinking about this in your 30s or your 40s as an advisor, you can plan ahead and be prepared to have that handoff sooner rather than just trying to wing it at the end. One final question. I'm sure there's lots of others that would be relevant, but this is the final one that I had is will my fees or services change? Just because you have a successor that aligns, even if it's in the same firm, it doesn't always mean that the service offering or the fee structure will be the same. Many people under the same umbrella operate in silos and you won't get the same fees. Maybe that means your fees go up, maybe it goes down. If you're used to a certain service offering, you may not get the exact same thing, or maybe they use different tools or approaches or different deliverables. If there's something about your current advisor that you know and love, better to know this in advance to avoid any surprises and talk through it with your current advisor. Those are the main questions that I've covered. And my main point here is that succession planning isn't really about your advisor leaving now. It's about thinking about protecting your own future as a client. And even if you ask one or two of these questions, it could give you huge peace of mind into what your advisor's thinking. And if they haven't thought much about it, just asking the question may be the nudge that your advisor needs to start thinking more seriously about it. And if you are an advisor out there, transparency on your succession plan, I think, is part of providing a good client experience. If you haven't thought about it on your own succession plan, now is the time to start. I think this is a super important topic whether you're a client or an advisor that are listening.
- [67:41]
A
Totally. Where we are now with PWL is effectively the outcome of Cameron's succession planning and thinking. He had a friend who's an advisor with a large practice who was diagnosed with I don't know if it was terminal, but there's a good chance it was going to be terminal cancer. He ended up not passing away at that time. He might still have some health challenges though. That was a kick in the pants for Cameron where he was like, I need to start sorting this out. We've been figuring it out while also growing like crazy over the last 10 or so years. And that led to Cameron buying majority ownership of PWL back in 2021. That was part of how do we figure this out? And then ultimately partnering with OneDigital was where we landed. But succession is not easy. Those are all good points. I'd be very curious if any listeners who have an advisor do go and ask their advisor these questions. I'd be very curious about how they get answered. What kind of things people hear from their advisors.
- [68:39]
B
That could be super interesting, the range of responses that people get.
- [68:47]
A
All right, a couple things quick in the after show here, we do have one review. Got to read the disclaimer first, we have a review from Apple Podcasts to read. Under SEC regulations, we are required to disclose whether a review which may be interpreted as a testimony was left by a client, whether any direct or indirect compensation was paid for the review, or whether there were any other conflicts of interest related to the review. As reviews are generally anonymous, including this one, we are unable to identify if the reviewer is a client or disclose any such conflicts of interest. This reviewer, Jeb Huys from Canada says fix yo mic, dude. Great show with a relentless rattling slash buzzing noise that emanates from Ben's microphone every time he talks. Drives me insane. 5 stars. Outside of that now you can tell me Jeb Hui's if this episode was better. Hopefully it was. There was some construction going on underneath me for a period of time that I was not able to escape during recording times, unfortunately. And so we were using the audio that Zoom captures because Zoom has quite good noise suppression. However, that noise suppression may have resulted in a buzzing sound that was driving you insane. So hopefully my audio is better now. If not, we'll have to look into what's going on, but thank you for the review anyway. Hopefully you can update Your review to 5 stars now that my audio is hopefully better. And if it's not like I said, we'll have to figure it out. Just that one review though. If anyone has the time, we'd love to hear from you. Always love reading the reviews. They're fun to read. We had two very successful meetups. I think I mentioned in the last episode we had that we would have had these meetups. We have now had them. Very successful one in Victoria. We were expecting around 25 people to come. It was closer to 50 that actually came. It was awesome. Great time chatting to people and it's very cool to see all of these people who were previously strangers socializing with each other because everyone has this shared connection through the podcast, I guess, but it's just like this group of immediate friends. It's a really, I don't know, unique and cool experience. So Victoria, probably 50 people. We were at Spinnakers, which is a historic pub in Victoria, right in the harbor, and then we had our meetup in Vancouver a couple nights later. That one probably had around 100 people. We weren't counting, but 75 people registered, and it was packed. We had the section of a restaurant of Earl's in Vancouver sectioned off for us. It was packed. I basically stood there talking to different people as they cycled through throughout the evening, took lots of pictures in both locations. It was lots of fun. The Vancouver meetup had three people from Seattle, which was kind of cool. Both meetups that just flew by. It was like snap of a finger and it was over.
- [71:27]
B
I wasn't there, but just hearing the conversation, it just sounded like a pretty cool environment to be in, and it's just incredible. The community that has rallied around this podcast and the outcomes that come out of it are sometimes unexpected. It's just cool to be a fly on the wall.
- [71:43]
A
It's honestly surreal, man. Cameron and I talked about this afterwards. There were multiple people that came up to us, in some cases almost tearful, like very emotional, talking about how the podcast has changed their life and changed their family's life, and they feel so much better about their finances and their decision making, and they're just living better lives. And they're like, we want you to know how impactful this has been. Cameron and I are like, man, this is crazy.
- [72:07]
B
It is crazy.
- [72:08]
A
It's very cool, though. Love to hear that, and I'm glad it's helping people. This is Cameron's crazy idea that I think I referenced at the beginning of the show. We are looking at doing potentially a whole bunch of meetups in 2026. Cameron's got this idea that we could hit a meetup in every province, and I'm like, oh, my, That's a lot of traveling, but okay. And potentially hitting some US Cities, too. So if you are in a Canadian or US City and would like us to host a meetup there, let us know. You can send an email infoationalreminder.ca. you can check out the RationalReminder community and drop a note in there in the episode discussion. But if there's a bunch of interest in a city, like if a bunch of people in New York want to meet up or I don't know where else there would be a pocket of listeners, then we will make that happen in 2026. We also have tentatively set aside November 12th for a Montreal meetup and November 18th for a Toronto meetup, potentially something in Ottawa, but we have not set a tentative date. And then also something maybe in San Diego in January, because I think Cameron has to go there anyway. So that's it. That's the meetup news. Lots of fun and let us know if you want us to host one in your city and we'll see if we can make it happen.
- [73:28]
B
Cameron will be all over it. If there is interest it'll be something we can figure out 100%.
- [73:34]
A
He loves the idea of going on a cross country tour.
- [73:38]
B
Heard about it many times.
- [73:39]
A
It is a cool idea. These meetups are really something. Very cool. To witness the interactions between the listeners between each other is super interesting to watch because all these people with diverse backgrounds and interests and whatever but they share this one thing and they all connect over that but also over other stuff. Very cool to see.
- [73:59]
B
Awesome.
- [74:00]
A
All right, I think that's it for the episode. Thanks for listening and thanks Ben for co hosting today.
- [74:05]
B
That was fun. Thanks for having me.
- [74:11]
C
Portfolio management and brokerage services in Canada are offered exclusively by PWL Capital, Inc. Which is regulated by the Canadian Investment Regulatory Organization and is a member of the Canadian Investor Protection Fund. Investment advisory services in the United States of America are offered exclusively by OneDigital Investment Advisors, LLC. OneDigital and PWL Capital are affiliated entities. However, each company has financial responsibility for only its own products and services. Nothing herein constitutes an offer or solicitation to buy or sell any security. This communication is distributed for informational purposes only. The information contained herein has been derived from sources believed to be accurate, but no guarantee as to its accuracy or completeness can be made. Furthermore, nothing herein should be construed as investment tax or legal advice and or used to make any investment decisions. Different types of investments and investment strategies have varying degrees of risk and are not suitable for all investors. You should consult with a professional advisor to see how the information contained herein may apply to your individual circumstances. All market indices discussed are unmanaged, do not incur management fees, and cannot be invested in directly. All investing involves risk of loss and nothing herein should be construed as a guarantee of any specific outcome or profit. Past performance is not indicative of or a guarantee of future results. All statements and opinions presented herein are those of the individual hosts and or guests, are current only as of this communication's original publication date, and are subject to change without notice. Neither OneDigital nor PWL Capital has any obligation to provide revised statements and or opinions in the event of changed circumstances.