RR #159 - Bill Schultheis: Build Wealth and Get on With Your Life

The work of Bill Schultheis has had a profound effect on us here at the Rational Reminder Podcast, and eventually having him join us on the show is truly an honour! Bill is the author of the Coffeehouse Investor series and is currently the Principal and Senior Advisor at Soundmark, in Kirkland, Washington. Throughout his career Bill has dedicated himself to helping his clients make the choices that best serve them and their particular needs, and his approach has continued to grow and improve over the decades he has been in the game. We have a wonderful conversation with Bill, charting his course from his early days on Wall Street, to writing his first book and starting Soundmark, to where is today. Bill gives us some great insider insight into the important concepts from his books and also talks about current issues in the financial world, like the impact of cryptocurrencies. Towards the end of our conversation, we get even more philosophical with our guest sharing some thoughts on what constitutes a 'rich life', and the importance of listening to your heart when it comes to your big decisions. So for this and much more from an inspiring and sensible voice, be sure to join us today!

Timestamp:
0:00 - 4:07 Intro
4:08 - 7:26 Welcome Bill Schultheis!
7:27 - 11:12 Promoting a book on early index investing
11:13 - 13:45 Start of investment advice industry
13:46 - 19:48 The three ground rules
19:49 - 23:42 The Coffeehouse Investor model portfolio
23:43 - 25:09 Go full cap weighted or add in the value and the small value?
25:10 - 28:03 Do you try to change people's minds when they feel very strongly about something?
28:04 - 31:28 Cryptocurrencies and commission-free trading
31:29 - 33:30 Similarities in today and '98/ '99
33:31- 35:50 Build up wealth early on in life
33:51 - 37:45 Failure fueling success
37:46- 40:50 What do index funds do not solve?
40:51- 42:59 What is the ultimate goal of financial planning?
43:00 - 47:10 What is a rich life?
47:11 - 48:21 Biggest mistakes that people make in financial planning
48:22 - 52:21 Aligning your financial resources with your essential creativity
52:22 - 54:24 Doing something that you love
54:25 - 56:57 Thoughts on FIRE
56:58 - end How do you define success in your life?

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[andreso]

The Rational Remainder (RM) have profoundly impacted my investing decisions and in a sense it has carved the path for me becoming financially literate. This in turns have helped my family and friends making better financial decisions.
Thanks to you guys have started to read financial books, financial papers and started to think and act on improving my financial wealth and ponder on how I want to live my life now and after retirement.
The RM is the weekly voice of reason that keeps me in check and pushes me to consider what is important in my life.

[NATOnova]

Looking forward to listening and glad to see cryptocurrencies being discussed. So much attention and people investing in cryptos without realizing its completely speculative.

[nickgenov]

Thank you, your content is invaluable! I have not managed to watch all episodes, but I am catching up!

[ciaranburks]

Ben "OG" Felix. Thanks for the amazing content as always guys.

[arielstulberg]

Ben saying "OG's" was an early highlight

[wk]

Can you ask him what was the outfox the box game?

[GhettoFabulousLorch]

> Cryptocurrencies
If you feel the FOMO allocate 1-5% to BTC and get to studying it before buying more. If (big if) it has a meaningful impact on global finance in the decades to come that mere 1-5% could dominate your portfolio.

Let's say that it does take over in the decades to come but you feel like you missed out. Let's say you never allocated your portfolio into BTC. You know those index funds you have? What do you think more than half the companies in your stock funds will own? What might back a good chunk of your bonds?

You cannot and will not miss out whether you invest through the front door now and take on the risks inherent to that possibility failing or the back door where by holding tight you still get more than a fair share of the wealth that might be created by cryptocurrency.

[dainiu]

Great content, but like a lot of older people, Bill fails to understand crypto.

1. Crypto currency is as much a currency, as "Main Street" is an actual street, where ordinary investors reside. Most of "Wall Street" firms aren't located on the Wall Street in Manhattan either. So when you ask investors if they own foreign currencies, your question is either ignorant or condescending.

2. Crypto has use cases. They range from NFTs to smart contracts. These use cases give crypto value. How much value, we'll talk about in point 3 but yes, crypto, as an asset class has value.

3. What is the fair value of crypto? What is the fair value of stocks, I ask? No one has a clue. Is the S&P 500 with a Price-to-Earnings of 24 overvalued? Why 24? Why not 14? The truth is, no one has a clue.

4. Will crypto return as much as stocks over 20 years? Again, no one knows. Did Germans in 1910 know their stock market would become zero, in the coming decades? But I'll tell you this: Crypto, in the last 2 years has returned MORE than the expected rate of return of VTI for the next 20 years. Maybe crypto will go down in flames, maybe the US stock market will. No one knows. The key is, diversify. Buy all three, stocks, bonds AND crypto... And HODL.