052 | FIRE State of the Union | Todd Tresidder | Risk Management
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052 | Todd Tresidder from Financial Mentor comes on the show to share his perspective on the traditional way FI is taught ( FIRE State of the Union) and where it could be improved. We discuss the unique characteristics of all three asset classes and the advantages and disadvantages of each. Create a framework for your wealth plan and understand the importance of risk management.
In Today’s Podcast we cover: An in-depth conversation with Todd Tresidder from the Financial Mentor on the State of the FIRE Union The math behind financial independence and how traditional FI-thought is about lowering expenses and investing in low-cost passive index funds Todd believes there’s more to the situation than commonly believed Todd does not want to optimize relentlessly based on price
What is Todd’s definition of Fat FIRE? There are multiple paths to FI such as pursuing the business and real estate asset classes to get you to FI quicker in Todd’s opinion Where does Risk Management come into play? Risk management also needs to be discussed in the FI community A nuanced, dynamic, “Level 2” understanding Finding the right plan for different people and different situations
The point of FI is happiness What Todd values: Experiences not stuff, and buying conveniences How Todd disconnects when he is on vacation with his family Todd has focused on all three asset classes in his life and background info on his history Todd is always focused on risk vs. reward at different points in time Todd’s on the ground view of the housing bubble as an apartment owner Paper assets do not lead to a “predictable” return
As an investor you always want to look for the “obvious thing nobody else is looking at.” Todd’s discussion of inflation Todd doesn’t predict the future, but he manages risk Manage the downside and risk management.
Buffett quote on not losing money What situation would it make sense for someone to invest in index funds, real estate, business, etc.? Everyone needs their own plan for wealth building The business asset class – inventing equity out of ‘thin air’
The downside characteristics of each of the three asset classes
