Rich Habits Podcast - 90: Demystifying Private Wealth Management

Episode Date: November 11, 2024

In this week's episode of the Rich Habits Podcast, Robert Croak and Austin Hankwitz sat down with the Co-CEO of Titan -- Joe Percoco.Private wealth management is no longer something only provided to the ultra-wealthy, thanks to ⁠Titan⁠.This "wealth management firm in your pocket" offers the everyday investor sophisticated analysis, passive index investing, an actively-managed strategy, and in-real-life events to their members -- unlocking the best of both worlds.💰 ⁠Click here to try Titan and get one month free!⁠ Simply use the code RICHHABITS when prompted during sign up.---It's time you have a clear understanding of how much you're making, and more importantly, how much you're spending every month.With Monarch Money, you unlock a bird's eye view of you financial situation -- giving you the tools and resources to get ahead.🔥 Visit ⁠MonarchMoney.com/HABITS⁠ for 30% off your first year!---Have you started diversifying your investment portfolio into real estate yet? With the Fundrise Flagship Fund, it's never been easier to add single-family, multi-family, and commercial real estate to your investment portfolio.💥 Get started with as little as $50. Visit ⁠Fundrise.com/RichHabits⁠ to add real estate to your portfolio today!---⭐ Download our FREE Budgeting Template – ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠click here⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⭐ Earn 5.1% on your savings with a High-Yield Cash Account – ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠click here⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⭐ Trade stocks, options, music royalties and crypto on Public – ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠click here⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⭐ Get a $35 bonus when you start saving & investing with Acorns – ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠click here⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⭐ Automatically buy stock where you shop with Grifin – ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠click here⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⭐ Protect your family with term life insurance from Suriance – ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠click here⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⭐ Use code “Spotify” for 15% off our 4-module video course – ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠click here⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⭐ Optimize your portfolio with Seeking Alpha – ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠click here⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠---👤 Explore everything Austin does – ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠click here⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠👤 Explore everything Robert does – ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠click here⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠❓ Ask us questions for our Q&A episodes – @richhabitspodcast on Instagram📬 Inquire about working together – [e-mail]---Hankwitz Group LLC has an existing business relationship with NEOS Investment Management LLC. The opinions expressed are those of the author, and the author owns several NEOS ETFs.

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mystify what it means to work with a private wealth manager. There are literally tens of thousands of you listening right now in your 30s and 40s, making six figures and above per year, looking for the playbook for financial independence and early retirement. And we believe our podcast does a wonderful job of laying out the groundwork to begin building that for yourself. However, we take pride in the fact that our podcast is always a way for us to introduce to our listeners, industry experts, and new investment opportunities.

And today is one of those episodes. We're joined by Joe Prokoko, the co-CEO of Titan, and we're super excited. And let me be very, very clear. Titan is the new standard for wealth management in America. For over a century now, iconic Wall Street investment firms have catered their white glove wealth management services exclusively for these high net worth investors sort of walling off the high earner but not yet rich investor like myself and countless others that are listening to the show right now. Titan is an award-winning wealth management firm based in

downtown New York City that actively manages the wealth of their members across the United States. They provide investment advice as well as relation access, which is something that we're going to get into here in a little bit. But I want to make sure before we jump into the episode that everyone knows that Titan is not your mom and pop shop wealth management firm. They've reimagined what it means to be a high-earning investor. Titan is literally the American Express of wealth management firms. So Joe is here joining us. We're really excited to have you, man. Welcome to the show. Thanks so much for having me, Robert Austin. Really excited to be here. So let's kick off this conversation by saying that I've had an account on Titan now since 2021. You guys are going to see a little screenshot that'll pop up on your

screen to show that. And I just want to say that so you guys don't think that, wait, no, Titan, they're just advertisers. They're here to talk. No, that's not the case, guys. I've been a user of Titan, just like we've been users of all the other cool platforms we talk about for years now. And we want to make sure that when these new products get introduced to the marketplace, you guys are the first to know. But the interesting thing is when I made my account on Titan, things felt a little less fancy. So for those of our listeners who might have heard of Titan before, but now they're seeing this sort of reimagined product, Joe, can you walk everyone through, one, who you are, two,

what Titan used to be, and now three, what Titan is today in 2024 and beyond. So I'm Joe. I'm from a small town in New Jersey called Hillsborough. It's one of those towns where roughly one third of it is farmland. I got to New York City. I entered the world of finance, worked at Goldman Sachs, worked at McKinsey. And once I paid off my student loans, trying to figure out how to manage my own wealth was actually really daunting, despite studying finance as an undergrad at Wharton. And so that was really tough. So I didn't see anything out there that I really liked for my own money. I'm the oldest of 12 cousins. I didn't see anything I like. for their money. And so I kind of just felt compelled to try to go build something I myself would want to use. And that today is Titan. So for folks who have been around, they can kind of see the exact March we've been on. The goal is to someday build something as large, as sophisticated, as powerful as the Goldman Sachs private wealth management business or the JP Morgan private wealth management business. We started a couple years ago back in 2018 with a fleet of actively manage products. And then naturally, we need to go launch passive products. We need to go launch

an investor advisor motion. We most recently launched lifestyle perks motion. And you can kind of see how that picture all adds up to what we're trying to do in the hill we're ultimately trying to climb. So Titan simply put, we're a wealth team in your pocket. But we do a lot of powerful stuff under the hood for our client. So, you know, for someone who's about to like download this app or like log into their Titan account, like what would they expect to see when they log in? Yeah, the analogy I use is Apple Store. Most people, when they walk into these different money products, money apps, they're like overwhelmed with complexity. There's all these dashboards. There's charts. You can buy, you know, anywhere between 3 to 5,000 public securities. Then there's all these buttons. And

ultimately, most people have a shoulder shrug. They're not sure what to do. So we had the exact opposite approach. How do we ensure that every skew or product or investment strategy in our store is the top-notch world-class version of that. So you don't have to have the paralysis of choice. And there should be a genius bar waiting back there on your beck and call to answer any question you have with pretty immediate response times. So that's what you'll see when you download the app. You'll see our hand-picked Apple-like best investment strategies.

We have one for Alpha called Flagship. We have one for cash called Smart Treasury. We have one for index income automated stocks. We have the Apple Genius Bar, known as our investor relations team. And then we also do bonus step. Like our corporate access team gets clients access to restaurants, concerts, you name it. Folks really love how simply we've stitched together such an awesome product, both between wealth and access.

As someone who's a big believer in the mantra that you're one TikTok, one phone call, one Zoom meeting away from a totally different life, the white-gloved conciergeist of Titan really impresses me. You all state that wealth isn't just about having money, but it's about having access, and I couldn't agree with you more. And so getting a seat at the table where the opportunities are presented, it just really reminds me of the Rich Habits Network and what we've built is giving our fan base and our followers and our clients access to our deal flow. So further explain the white glove conciergeers and what it is for our listeners, what are the perks, what are the opportunities, and how can they learn more about this?

this part of Titan. And Robert, yeah, you hit it on the nail, which is that most of the industry, you know, they just sell kind of glorified commodities and they put wrapper brands on it. What's the real stuff that you're getting at the investment banks if you're a high net worth client? You're getting access to different sorts of products like alternatives, but not only that, you're getting access to ideas. So for example, several of the investment banks this morning, as of today, today for folks who are listening is the immediate day after the election are getting hit in their inbox with, we have a private call, clients only with an ex-general of the military to just understand foreign policy with this new regime. So access to ideas, access to services.

So most people don't understand the different tax services that are needed to drive what's called tax alpha. And then additionally, and this is kind of more the off-the-book stuff, they'll ping you, Austin, or ping you, Robert, say, hey, we got extra tickets to the Jets game, want to come to the box. So there's this whole rapper experience delivered by your private wealth manager. And you can think of them as the quarterback for your money, for ideas, for the services, for the perks. And that, unfortunately, hasn't yet been democratized in a material way, which is why we're really, really excited to have seen success and keep making progress on that. One of the things that I talk about the most is for Austin and I, our job, because you don't have to be first to an investment,

you just have to be ahead of the masses. And like you say, and I love that what you said this is that you're getting ideas and information the legal way is that that is one of the things we get to do every single day that I love the most. And that is providing information to people ahead of the curve. Because if you're ahead of the curve, whether it's humanoid robotics or nuclear or whatever the sector is, that's where you win the most. And I like this because that access gives people that information.

ahead of the masses because as we always say, by the time it hits Facebook or Instagram or TikTok, it's probably too late. And so I love that you talk about that as part of the access is having that connectivity and that information and those ideas because that's where the real money is made. Could not agree more. If you think about what the state of the world is today, we think of it as a black box experience. I'm a sports guy. So I liken it to you usually hand over your money. so let's say a money manager if you choose to use them. And then your ticket is outside the stadium. They have this walled entity where they're making decisions,

they're trafficking and information flow. Maybe you get an email, maybe you get a quarterly update, but otherwise it's bifurcated. You give them your money and then you try to figure out what's going on yourself on CNBC, Wall Street Journal, you name it. So to summarize, you give person money, but then you try to figure out what's going on yourself. Ultimately, if you're wealthy enough,

and let's say you're an endowment who's given your money to a hedge fund manager, you literally call hedge fund manager directly and you say, explain to me what's going on in markets now or else I hang up the phone and I pull my money. And so I've always wanted to, we call it, give everyone personalized court side seats to their capital. Like you should not only give Titan money, you should open up the app and have everything explained and really crisp, simple English, what's going on and why straight from our investment team's desk. Most often one of the things they love about us the most is just the education component. No one ever has a money teacher formally. We happen to learn everything else in college. You want philosophy, literature, calculus,

you name it. But no one teaches you the essentials of managing the currency by which you live. So to your point, Robert, ideas and education is just this sleeping killer or sleeping reason you win if you know how to harness it. So now before we jump into our next question. Let's hear from one of our sponsors of this episode. You've all heard us talk about the importance of diversifying your investments for a while now, and there could be a major opportunity today in private market real estate, especially with the market timing right now. Because we know it's a lot of hassle to be a landlord and of course requires a ton of upfront cash, we were focused on finding an option that everyone could have access to, which means you can

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at Fundrise.com slash flagship. Just want to really encourage you guys to go check out this one. I've been a Fundrise investor now for I think five years, six years. I mean, right when I graduated college in 2018, I jumped on this platform. I've got several thousand dollars invested with them. I'm riding the wave up, down, left and right, as it relates to commercial real estate. And I really want to encourage everyone who's built their base and wants to diversify in real estate without going out and buying a single family or a duplex or something like that to go check out the funrise flagship fund you can get started with $50 a hundred dollars five thousand whatever fits your budget it's really really cool so a thumbs up from

robert and i all right let's now jump into our next question just to kind of dig now into sort of these strategies robert i'd argue that between the two of us i'm the more analytical one i'm always excited to research new stocks and investment strategies so in titan's case you guys offer what you dub like this flagship strategy product which essentially is an actively made managed portfolio of 15 to 20 single stocks that have these proven track records and show potential for long-term capital appreciation for your investors. So what is the strategy? And for your members, where has it normally fit inside of their well-diversified portfolios? Is it something that they put their money into supplement growth? Is it something they, you know, say, I'm going to do this

plus the index funds. I'm going to go all in on this strategy. Like, how do you guys, one, like, what's the secret sauce around it? And then how are you sort of presenting it to your member here. One of the really exciting part about flagship, we wanted to build them as Baby Berkshire. And this, you can tell, comes from our old school finance academic roots. And just take a moment there, if you don't mind, joke, walk people through what Berkshire is in case they're not familiar. Absolutely. So Berkshire Hathaway is run by Warren Buffett and the late Charlie Munger, who passed away. Buffett has been, you can call it, the father of what's known as quality investing or growth investing now based upon his actions. And that means there's a variety of different ways one can make

money in the world. You can, I don't know, go buy different local franchises of Dunkin' Donuts or McDonald's try to build a flat cash flowing empire, make money that way. You can go buy and sell commodities. You can try to call quarterly earnings. Like, well Tesla go up or down this quarterly earning cycle. You could trade futures. You could trade options. You can buy and sell crypto. A lot of the great investors have all coalesced around what's called quality investing. And it's very simple. They have a private equity-like approach to investing in stocks. That means I should think about if I only had 20 punch cards, as Buffett famously articulated, if I could only make 20 investments in my lifetime, and each of those had to really matter, and I had to make sure they were long-term-oriented, they were going to do good things with my money, and there was the right risk-adjusted returns. Are those wonderful businesses at a great price? So notice the two legs of that. Is it a wonderful business? Is it a wonderful business? business. And what does that mean? It's resilient. It has good growth prospects. It has good margin potential. It has high returns on capital. Great. And then great price. Is it overvalued or

undervalued by the market? So Buffett built an entity called Berkshire Houth away with Charlie Munger to pick what are the top punch card like investments. This top one right now is a company called Apple. I imagine a lot of us use the product. Others have included Coca-Cola, Guyco, and so on. So with Flagship, we said we want to build our version of that, a quality set of 15 to 25 investments, sector agnostic, focused on large-cap U.S. investments, designed and geared to hopefully outperform the market and provide alpha exposure. So we love it because it complements what's called beta or just tracking the index for our clients. To your question, Robert, some people use it for a lot of their wealth. Other people use it as an attach to their SMP 500 index fund. So folks use it for, for different purposes, but namely the goal is growth at a reasonable price or baby Berkshire. I'm curious, I mean, you don't have to get too personally here, but how do you use Titan as the co-CEO? Are you looking at, you know, having a lot of your personal wealth inside of this strategy?

How do you use Titan? Yeah, Titan has a really large percentage of my net worth. And I'm in flagship auto stocks, smart treasury predominantly. So namely, the major core food groups of just overall investing. My view is people really complicate investing in oftentimes discussions center around the long tail of are you trading options or not? Are you now trading futures? Are you in and out of this stock? How much invidia do you have? In reality, that should be a very, very low percentage of one's net worth unless you have a disproportionate advantage. You kind of really just need to nail.

Are you exposed to a really heavy degree to the U.S. economy in a thoughtful way? So you could either do that via indexes or something like flagship. And then for your liquidity, bucket, are you earning interest on your cash or is it wrongfully just sitting in a checking account? If you can nail that, you're 90% ahead of like most folks. So I have a very simple approach, even to my own well. I love that. And, you know, I'm just thinking too through here. It's like, I'd argue a lot of our listeners, including myself, right? I very much have, call it $800,000 to a million dollars invested in the markets across a bunch of different sort of platforms and ETFs and individual stocks and cryptocurrency, like all the fun stuff there. And so like for me, I use,

three or four different platforms to help me check those boxes, right? I use Fundrise for, you know, commercial real estate because I have no option of ever buying a commercial real estate property as a single investor here. I use Coinbase for my cryptocurrency, right? I've got a couple of these things here. So as it relates to our audience right now, listening to this episode, how do they begin to weave Titan into their sort of, you know, diversified portfolio of different platforms? Do they move money into Titan? Do they open an account on Titan and do net new capital toward that? Is Titan maybe the way that they think about their treasury is Titan the way they think about those 15 to 20 stock strategies. How should people be thinking about using Titan alongside some of the other platforms that I know a lot of our listeners have?

Yeah, definitely. What we often see do is clients will pick us for one of the initial court food groups. They'll confirm, okay, who are these guys? Let me get to know them. Is this thing on? And then once they see, okay, they trust us and so on, they use us then for all the core food groups. So we see people either start with just flagship because they're really excited about the active exposure. The alternative would be, you know, trying to hunt through maybe different alternatives or if they have access to hedge funds or even actively managed ETFs. It's kind of a bit of a crazy world. So they really like our approach in the simplicity or smart treasury, which is kind of the, you know, instead of having to react to all these different spammy, you know, here's the cash yield rate, like add $100,000 and we'll increase it by five basis points. Instead of having to react to that, they love that our team

automatically is moving their capital and their cash to get the highest earning yield. So then thereafter, they'll use this for a core food group. But no, we're totally fine with people having these other platforms if they want exposure per se and direct crypto assets or if they want to own, let's say, specific real estate assets. That's awesome. And they should express those things. The thing we always remind is it's not that you shouldn't express it. It's what percent of your overall wealth are you risking on that platform?

i.e., as I'm sure you guys are both aware, just an allocation decision. Your pie, what percent of your pie is going to this? It's not that the slice in itself is bad. It's just is the slice too big or too small. So that's what people usually call us for is just help with, am I holding too much cash? Am I holding too much crypto? What should I do with it? So we coach people a lot on those questions. So walk me through so I understand for myself and our listeners, because this is very intriguing and I love what I hear. What is different? If you take away the bells and whistles, you take away the perks of Titan, what is difference between Titan's portfolios and a standard fiduciary firm that would be in wealth management? What is the secret sauce that Titan has that others may not? Two, it would be cost

and simplicity. And then the third, you could say, is also some of the performance of our vehicles. So let's go through each of those three. First is costs. I have a personal mission. I want to go to war on this 100 basis points advisory fee before then you get layers and layers of fees inside these other products. And so cost is one of these just hidden villains that affects portfolio returns. I hate the sleepy old guy who just puts you in a commodity but charges 1% for it and barely communicates with you. So our products, once you're inside, the highest asset fee is 20 basis points compared to the market, which can give you 100 basis points plus. Secondly, simplicity.

This is really important because most people have really difficulty sticking to plans that are created for them for their wealth because you just can't fall asleep at night feeling that it's good. And so we have a framework and a philosophy at Titan called the three G's. I can walk into that, which is you need to think about your wealth as three buckets of money, not one. So most people will say, should I invest my money now? And notice the word, my money. It's like a singular bucket. Should I go take my treasure chest and move it in the market or move it out? So our framework where we coach people to say, you need to think about it as three.

There's a liquidity bucket, a growth bucket, and a retirement bucket. We call that the three Gs, guard growth generation. They really appreciate that because it enables them to go get those compounded returns in the growth bucket in particular. And lastly, performance of our products. So for instance, our cash product, we're able to get folks highest after-tax returns and leased in our available universe and money market funds, because the product itself automatically moves client capital

instead of, let's say, Austin, just dormantly keeping cash and getting whatever the rate is via the banking entity. So we wanted to build something that's simpler, it's lower cost, and the products help deliver better outcomes via our philosophy and the construction, i.e., when you boil it all together, just can we actually deliver Apple for your money? That was the goal. I love that answer and that was amazing. I had a one-on-one call with a client the other day and asked them what they were paying for their wealth management. They were paying 2.5%. Oh, gosh. I don't even know how that's legal. I said, fire them tomorrow and I will get you in a much better place. I know all the right people to help you because that is egregious and just so, so wrong. And just one more thing real quick, Joe, walk me through how are you guiding all these people? people. How are you coaching them? Are you doing Zoom calls? Do you have a team of people that work with all

the clients that are coming in to get them situated? Walk us through that real quick. Totally. We use technology. We also use relationships over digital means and also in person means. So lots of our clients actually just prefer to get a 60 second video update on let's say we increased our position in TransDime and flagship. TransDime is an aerospace supplier, has a borderline monopoly in their industry. They're like, I don't need a phone call, but I love the, let's call the Instagram or TikTok like content that's actually coming from a wealth manager in the app. The, let's call it digital relationship we have, or let's say the schedule a call with our investor relations team or myself, or let's say we have a Zoom call explaining presidential impacts on, let's say, foreign policy.

And then in person, we always have clients coming in person to our office pretty much every day. We're here based in Greenwich and Soho. We deliver education information. to our clients or however they want it. Soon, we're going to be really excited to make a big push into artificial intelligence, which is just another means for how we can deliver information in real time. We're not dogmatic. There's some companies that say we're tech only or humans only or pretty much customers only. If you want a phone call, great.

If you just want a little notification in the app so you can get back to your day job and just know we're on it, we'll do that for you too. I love that. Let's wrap things up here with the research. You all provide your members with weekly insights on market trends. You answer member questions on investment ideas, which you covered, performance, and more. You also publish quarterly deep dives into your investment performance, the latest investment trends, and major market events.

So who's writing these reports? And do you have any examples of recent topics so our listeners can get a feel for what the information is, what they can expect in being a member of Titan? And then we'll go from there. Now before you answer that question, Joe, I just want to take a moment to hear from this episode sponsor Monarch Money, which by the way, just received the award for best budgeting app of 2024 by the Wall Street Journal. Monarch is the modern way to manage your money. Whether you need to stick to a budget, track your investments, or collaborate with your partner, you'll get clarity, confidence, and a peace of mind for your finances with Monarch Money. Specifically as it relates to collaborating with your partner, Austin, Monarch Money makes it simple to set shared money goals, Access a joint-view dashboard to track your progress and you even receive monthly email updates that include a breakdown of where everyone's money went during the month.

And I love this feature. Robert, my favorite part about Monarch is that it's so easy. You simply log into Monarch money and see all your finances and minutes track your spending. And it's all at a glance. Monarch is a top-rated all-in-one personal finance app because Monarch helps you make smart money moves very simply. After trying out Monarch for myself, I get why it's the top-rated personal finance app. And right now, listeners of this show will get 30% off of their first year when you go to monarchmoney.com slash habits. That's M-O-N-A-R-C-H-M-O-N-E-Y.

Dot com slash habits to get 30% off your first year. We appreciate them supporting the show and all of our listeners. All right. Let's see what Joe has to say. Absolutely. The reports come directly from either our investment team, if it's around, let's say, a stock, security selection, or a market trend, our investor relations team, if it's, let's say, a wealth management tip, like how to not hold too much cash or how to think about it, or if it's, let's say, on more tectonic forces, then it might actually just come from me personally, and I'm writing or filming content for our clients. So let's do one example. Probably the greatest mistake we see folks make when they come to us, and whether we manage money for a lot of different types of people,

whether it's literally congressional officials in D.C., athletes, engineers at large technology companies, you name it. Pretty categorical, though, when they come to us, most make the same mistake in that they're holding too much cash. Cash is sacred. Totally get it. It is very emotional. Putting it under the mattress or in the checking account that you've had for 15 years is so safe, it's so calming. Why would anyone want to change? Like, just let us leave it there. So how do we possibly get through to these people that there are hair, like handicapping the possible earnings that they could have over their lifetime. So we put out a really thoughtful piece a couple weeks ago, which is just like cash is your silent assassin of your returns. It was both data driven, but it was also emotional and practical. And we tried to do it in two pages or less as a sweeping argument for why we would give you

one task in November. And the only task was just take a look and see if you're holding too much cash. And if you at all have a question, call us. So that was an example of a, piece unlike the invidia deep dive which we put out in September which that went into why we think there's a variant perception on invidia's position i.e. people don't understand how strong it is. They know it's strong but they don't understand how strong it is and that could provide a disproportionate view on the stock. So those are two entirely different types of pieces. One is a massive call to action with your cash that almost tries to shake you at the shoulders to like not make the this mistake. The other is a more cerebral cognitive exercise going down a really deep path

on a very perception on specific security and flagship. So as a Titan client, you get access to all of this and folks pick and choose what they follow along to. Some people literally consume us for breakfast, whatever we're serving. Others are like, I don't have to follow along to that degree. Just keep me posted for your major stock updates that you publish once a month. So they get access to all of this. We do it multimedia, videos, PDFs, calls, zooms, you name it. Goal truly is just quartitees. That is just so interesting.

I mean, you guys, I think have like a couple newsletter type actions going on. I think it's called like three things or three things today or something. I know my friend Katie Perry helps you guys write some of that. And, you know, it seems like you guys have some really, really cool insights as it relates to not just portfolio structure, but some deep dive analyses, maybe some secular growth trends. I mean, seems like you guys are doing everything right as it relates to making sure that your investors stay up to date on what's going on in the markets, the economy, but also to kind of give them the nudge and say, hey, like, are you doing this right? Like, here's what we think. Like,

don't forget. Like, don't fall asleep here at the wheel. Absolutely. I always thought there was so much noise when we entered. There was so much noise. So many newsletters. So many things. So much stuff to read. We really wanted to be signal. Anything coming out of our desk, people should know. We've reviewed it internally multiple times. We believe it's worthwhile to hit send. And we've tried our best to cut as many words out of it as possible. So it's really efficient with your time or if you're watching how you teach someone is an ultimate luxury that like and responsibility that one shouldn't take lightly. I was a teaching assistant at Wharton. So you can tell like the inner professor in me comes out and like the curriculum needs to be solid that we're going through with folks. I think that's super important though because like so many podcasts and so many newsletters, it's just word scrabble and it just goes on and on and on and they get off topic.

And I think one of the things we do the best, and you've certainly done an incredible job here today in this episode, is we condense it down into bite-sized chunks that are actionable. That's it. That's what we want the goal to be because we could bury people with information, but then they're just going to suffer from analysis paralysis and they're going to do nothing. So I really, really appreciate your approach and everything you're doing with Titan. 1,000% and it almost like, if you really zoom out and you just take a look at the world and how it's been changing, probably over the last few decades, information edge was the edge to have, whether on Wall Street or any sort of discipline. Did you have access to all the disparate sorts of information resources? For example, in the hedge fund community, it was really hot five to 10 years ago to try to track credit card data to predict which companies' revenues are going to outperform. Now you're in a world where everyone has access to a plethora of information and sources.

So the edge is no longer the volume of niche information that you have. The edge is the synthesis of it. So artificial intelligence is becoming super important for folks on how can they synthesize and comb through thousands of documents at once to get to whatever is the aha or the core insight. Similarly, we have that approach on synthesis as the edge. Like we're not going to barter clients with like four different updates. Markets up 2% by noon, down 1% by 2 p.m. And like, oh, hey, like there's this new data point. I just want to every morning give people.

And it's why it's called three things. What are the three most important things we are following that day? That's it. There's no fourth thing. There's no fifth thing. It's just three. And you'd be surprised a number of times people internally have wanted to put a fourth, fifth, and sixth thing in that newsletter.

and by decree, I draw a hard line in the sand and I say, you must pick three. That is it. So synthesis is critical, not just for us as a money manager, but in most fields and profession, in particular yours, which you guys are an awesome job at. We appreciate that. And Joe, this has been such an insightful conversation. Thank you so much for joining us on this week's episode of the Rich Habits podcast. Really want to encourage our listeners, those high earning, you know, 100,000, 200,000. Some of you all earned in 300,000 as a household here. Give a tight and a look. It's $25 a month to become a member. And if you use the link in the show notes below, you get your first month for free on us, which means you unlock not only these deep dive analyses

and everything cool that comes with being a member of Titan. But now you also get access to the Titan suite at Madison Square Garden for concerts, reservations at those exclusive restaurants, and a seat at the table with other like-minded individuals. So we'll be sure to leave a link in the show notes below for that. Thanks for having me. Austin, Robert, keep fighting a good fight. Finance is important and it's behind relative to other tech and you guys are a Friday in the good fight. So much respect to you. We appreciate you stopping by and really love what you're doing. And we will continue on our journey. That is for sure. So thank you for stopping by, Joe. Fight the good fight. See yeah. So the first question of our question and answer edition of this podcast episode comes from Marvin B. Marvin says, hey guys, I love your podcast. It has literally changed my investing journey completely. Now I'm simply addicted.

to learning more about investing. However, I have a question regarding Robin Hood's IRA 3% match. Is this something good or should I stay away from it? Something you guys talk about in the past is always getting the free money, especially as it relates to the match with our 401Ks. But what are your thoughts now on Robin Hood's 3% match with the IRA? Thank you and more power to you. Robert, we've talked about this match in the past.

And I think there's a couple stipulations that come with it, right? I think there's something about like being a Robin Hood gold subscriber. So I think that's like $5 or $10 a month. So let's call it $60 to maybe $120 a year that you have to pay to be a part of that to get the match. And then I also believe that you have to keep your money invested on the Robin Hood platform for like three or four or five years, something like that. Which again, if it's in an IRA, you're going to want to keep that money invested anyway. So if you're someone who likes the Robin Hood gold feature, which means a little bit more insights into what's going on. And I think they've got like a high yield savings account or something on there you get access to as a Robin Hood gold subscriber.

and you plan to keep your money on Robin Hood for several years, which I don't know why you'd want to move it off, assuming it's invested correctly, then yeah, get the match. If it's 1, 2, 3%, whatever it looks like. I know Robin Hood has these sort of promotional deals. Sometimes it's three, sometimes it's one, sometimes whatever there. But I think it's a totally fine idea. I don't see anything scamy about this. I wouldn't worry about it being a scam. It could just be a really cool way to add, you know, an extra couple hundred or even couple thousand dollars to your IRA depending on if you move it over there or if it's new money added to the account. Yeah, I'm all about getting the free money.

As long as you understand the opportunity cost and you're not putting it somewhere where you believe you're getting the most value and the most gain on your money, while you might be leaving another opportunity open that could have been better. So Marvin, as long as you understand the difference and you're willing to roll it over

and you think it's the best play, I think it's a great idea because we always want to get as much passive free money as we can. Yeah, I think I saw even on Reddit a couple of days ago, Maybe he was Twitter or something. Maybe it was a screenshot. I don't know. But some guy posted maybe in like Wall Street bets or one of these subredits that he had like

20, 30 million in one of his IRAs that he rolled over into Robin Hood and they gave him like a 1% match. And so this guy was making hundreds of thousands of dollars of free money just by housing his investments on a different platform. So I don't know if they're running that or not. But at the end of the day, just make sure you're doing your best to optimize for every one, two, three percent you can. Now our next question comes from Steve.

Steve says, Hello, Rich Habits. I'm a big fan and a long-time listener. Hey, Steve, how's it going, man? Steve says I own SPYI and QQQI in my dividend growth portfolio, but I have some other funds with an investment firm, and they tell me that covered-call funds like these are fine when the market's going up, but those covered-call ETFs have a very short history.

When prices decline in the markets, call premiums evaporate, leaving you exposed to downside risk. Of course, the ETF price would follow the underlying index down, but would covered call premiums evaporate in a down market like they say, are SPY or KQQQI and similar income focused funds more risky than the underlying indices they claim to track? Short answer, no, they're not more risky, right? At the end of the day, SPYI and KKQQI have all the same holdings inside of them as the S&P 500 and the NASDAQ. So theoretically, it's the exact same risk. I would argue they're mathematically less risky because even if we are in a down market and maybe the volatility,

which option premiums, which means how much you get paid in cash to sell these covered calls, normally go up and down markets, right, because the volatility index increases, which means that people pay more for options. But let's assume they do go down. I don't think they evaporate. I think that's kind of hyperbole. But they could go down in a bare market of such. But even if they do decline by a couple percentage points, I mean, we're talking about a 9, 10, maybe 11% annual yield still on your money versus a 0% annual yield, assuming that You are not doing any sort of income focused optimization with your holdings of the S&P 500 of the NASDAQ. So in my opinion, I think it's mathematically less risky because in a bear market, right,

if you think about it, you're going down with the bear market because you hold the same stocks, but now you're getting the income to supplement the price depreciation of the share price of this ETAF. So it's getting supplemented mathematically by the income, which means your total return is better than if you just had your money in the S&P 500 of the NASDAQ. That's why I love my partner, Austin. You just crushed that. I couldn't have said it better myself. And Steve, I think you just have an investment firm that wants to sell you their products.

And they want to make their fees on those products, which are probably much higher fees and lower gains and returns. So I wouldn't worry about it. I think you're in a really great place. You want to get this income from SPYI and QQQQQI and everything Austin said, I believe, is spot on. So I would not worry about it. I'd stick with your guns of where you're at. and then give yourself a couple years and then go back to that same investment firm, that same advisor, and compare their returns to your returns of what you put your money in, and you'll know then who was right or who is wrong, but I think you're spot on.

Yeah, I think the biggest thing to remember here, Steve, is that these income-focused funds do a great job of creating tax-efficient income inside of a well-diversified portfolio. I have close to $900,000 now invested in the markets, maybe closing it on a million. I have to do the numbers. But, you know, I've got $100,000 straight up in SPYI. It's a 10% sliver of my, you know, overall, it's called it investment portfolio. So it's not the majority by any stretch of the imagination. But that $100,000 is awesome because it's providing me with monthly tax-efficient income. I can use to go either reinvest or buy a different asset class or something else. So in my humble opinion, I think people should be thinking about SPY and KQQI as great supplements, you know, to a well-diversified portfolio to optimize for tax-efficient.

efficient income and some upside appreciation in rising markets. I just think it's a really cool, you know, gravy to put on top of your mashed potatoes, essentially, as we near Thanksgiving. And something that I want to bring up that's not part of the question, but it's part of a question that I've been seeing more of. As we talk about these income producing funds like SPYI and QQQQI, everyone knows that follows along. We love Nios. Explain to the customer and to the listener today that it does not matter where they buy these funds. They can buy it in their own brokerage accounts wherever they like, wherever they like the platform, because I think some people are confused that when we add these new products like SPYI, that they

believe they have to buy them in a certain place to get the same advantages, and that's just not true. You can buy these funds in any brokerage account that you want. Personally, I use my bridge account, right, my normal taxable brokerage account, because if we think about it, what alternative do I have? I can put it in my Roth IRA, or I can put it in like a SEP IRA or a solo 401k or one of these other retirement accounts. But the reason I choose the brokerage account specifically is because the monthly income that these funds spit out and pay to their investors is very, very tax efficient. I mean, so tax efficient, it's nearly tax free if you think about it. And the

reason I say that is because it's classified as a return of capital. And when you pay an investor and you classify it to the IRS as a return of capital, so Nios is paying the investor of their ETF, this return of capital. That is simply saying, hey, you gave me, Austin, your $100,000. I'm giving you now a thousand of your own money back. It's essentially, I'm just returning your own capital to you. You didn't make any money. You didn't lose any money. So you don't have to pay any taxes on it. Now, that $100,000 is now worth $102,000 because that's just how the markets work. And I've been paid a little bit more back, which is cool, which means that I don't pay taxes theoretically on that income, that $1,000 I made during the same calendar year that I received

it. Instead, that $1,000 is taken away from the cost basis of my original investment. So when I do want to sell my shares eventually one day, I will now have a lower cost basis, and that's sort of how that looks like. But the good side of that is it turns into a long-term capital gain. So I'm taxed as long-term capital gains and not taxed as ordinary income that some of these other dividend funds do tax their investors at. So at the end of the day, I have a taxable brokerage account that I keep mine in, but if you put it in your Roth IRA and you just like the income to sit there and you can reinvest it into other parts of that Roth IRA, be my guest, you're still going to get the income no matter what sort of brokerage account you use to buy these funds with. So our last

question comes from Ethan. Ethan says, hey Robert Nosson. My name's Ethan. I'm 18 years old and I just got a job paying $26 an hour right out of high school. I've already invested $7,000 into an individual brokerage account and I put it all in VOO and VGT. I'm just now opening my Roth IRA and I want to want to max it out as soon as possible in the same ETFs. My question for you guys is should I keep going at the same S&P 500 ETFs until I've built my base of, let's call it, $50,000 to $100,000, or should I start investing into high dividend paying stocks as I'm still young and I want to retire sooner than later? Thank you guys so much. I love listening to the new videos after work. I can shoot you straight here, Ethan. Normally people want to have dividends in their portfolio when they're kind of

scaling back a little bit, right? You are young, you're 18 years old, you should be aggressive. You should look for the high octane growth stocks. You did a great job by calling out V-O-O-O and V-G. Maybe there's a world you can also add VUG to this equation, which is the vanguard's like high-growth ETF, essentially. It's done incredibly well. So the VUG ETF over the last 10 years has had a total return of 320%, whereas the S&P 500 has

had 240%. So it's outperformed by 80%. right so v u g vg t v o o right these are the funds you're going to want in your rath IRA considering you're so young and just want to remind you here do not let the april deadline of 2025 to max out your roth IRA for the calendar year of 2024 go buy without maxing it out first you're sitting on seven thousand dollars in a normal brokerage account which is enough to max it out already just want to make sure that you don't like make the mistake of missing an entire year of contributions at such a young age because at 18, I mean, just $7,000 invested into some of these growth funds is going to be worth

several thousand, hundreds of thousands. Who knows, in the next 50 years when you're 68 years old, right? I mean, compound interest is incredible. So getting as much money as possible into a Roth IRA at such a young age is the paramount most important thing you could be doing right now. And congratulations on making $52, $53,000 a year right out of college at 18. That's amazing. You were going to far outperform most of your peers that went to college and took on the $100,000 of student loan just to get the job paying them $70 grand. I mean, Ethan, you are crushing it, my friend. Congratulations and thanks for listening to the show. Yeah, and let's take out the fact of the money, the hourly wage, and all of what we've heard here and just give kudos to Ethan at 18 years old is following along a podcast like Rich Habits. while most 18-year-olds are out there worrying about fantasy sports and barstool sports and all that stuff.

So, Ethan, you are already in a really great place, mindset-wise, and really looking to your future and what you're going to do financially. So I love that, and you're on the right track, like Austin said. Get that Roth maxed out as soon as you can. Keep the other account because we want to make sure you always have that individual, that bridge account, because then that way you've got your retirement money and you've got your day-to-day investment money that you control. But I just love where your head's at and the fact that you're 18 years old and you're carving out a path at a time when most people aren't thinking about their finances for another 10 years. So I love it. Keep crushing it. And thanks for following along on the Rich Habits podcast.

Now, Ethan, to give you a playbook, this is what I'm doing, right? I'm 28 years old. I plan to retire early. I don't want to work until I'm 65 and then depend on my retirement accounts and Social Security. Right. I want to have an individual brokerage account, something on podcast. public.com, you know, my bridge account with hundreds of thousands, if not millions of dollars inside of it, that pay me enough every month, every year to live off of and retire, not have to work.

I've been publicly building now a $2 million dividend growth portfolio. You can just Google Austin Hankowitz's $2 million growth portfolio. Like it'll be there. There's a ton of articles that I've written about it. And the reason I'm doing that is because once I hit $2 million by the end of the decade, maybe another 7, 10 years beyond that, who knows. But once I'm I have $2 million in this portfolio, I can put that into dividend growth stocks and that'll pay me 80,100, maybe $120,000 a year, depending on what kind of yield I want to lean in on, higher yield, lower yield, more growth, less growth, right? But that gives me the autonomy to choose and retire in my 40s, right? And so that's the goal. And Ethan, if that is your goal too, how I've kind of thought about

this portfolio is I want to be aggressive, right? I have Bitcoin, I have Tesla, I have hymns and hers, I have Invidia and meta, like I have these companies that are aggressive non-dividend paying companies that will grow. But once they've grown so much, I then scale out of them and put them into the dividend companies, right? So I make a lot of money, hopefully, right, fingers crossed over these growth names like Bitcoin, for example, I'm up $80,000 with that. And then over the next 12 months, I'll take my 80, $1, $1,000, $1,000, $150,000 of profits and then put it into the dividend stocks. The dividend stocks weren't going to grow $150,000 because that's just not how they're programming. right but now I have 150,000 more of the dividend stocks that are going to pay me passive income that then allow me to retire quicker. And so that's sort of how I've been able to like position and build a

strategy around me retiring early. And I think Ethan, that's probably what you want to do as well. So balance the Roth IRA contribution with sort of building this bridge account. And then once you've kind of, you know, grown this bridge account to hundreds of thousands of dollars, maybe there's a world where you put most of it into like a SPY or a QQQQQI or a BTCI. right, the Nios Bitcoin covered call ETF now paying 27 percent, and you're able to now peel off three, four, five thousand a month in passive income that is very tax efficient. So there's a ton of different ways to skin this cat, but I think the most important thing is you are focused, you're invested, and you are doing very well at 18 years old. You're asking the right questions.

What an incredible episode. I am so excited that we get to do this each and every week. And we appreciate all of you that follow along in the Rich Habits Network and the Rich Habits Podcast. So make sure if you haven't checked out the Rich Habits Network, you definitely want to do so. We have an incredible newsletter. We do weekly private lives with the community. We have one of the best school communities out there. And I think it's probably the greatest value there is for your educational purposes and personal

finance and stock markets, cryptocurrency, how to build your business and all of that. So we appreciate each and every one of you. and thanks for stopping by every single week. And don't forget to check out Titan. Go become a member if it resonates with you. There's a link in the show notes below. Be sure to click on that. Check them out for sure as well.

And as always, have a great start to your week.