Financial Planning May Look Different for Gen Z and Millennials with Zechariah Schaefer

Even in a small firm or for yourself, a financial plan is very important. It's a road map, a guideline, and a reminder of what you want to accomplish.. But in this contemporary time, what is the optimal way to maximize money and maximize your life ? In this week’s episode, Ascent Personal Finance Founder Zechariah Schaefer joins us to discuss the ever-changing financial industry for Gen Z and Millennials, crypto, retirement, and much more. Zechariah Schaefer is an Advice-Only Financial Planner for Gen Z & Millennial Crypto Investors & STEM/Healthcare Professionals. He founded Ascent Personal Finance to empower young people to build financial freedom. Ascent Personal Finance empowers young people to reach their financial goals by helping them with their crypto investing, taxes, budget/credit, starting businesses, and more. Zechariah Schaefer ensures to have a methodical financial plan that is updated regularly for a successful life ahead. If you're interested in building your holistic financial plan, listen to this podcast on Actions Antidote! --- Listen to the podcast here: Financial Planning May Look Different for Gen Z and Millennials with Zechariah Schaefer Welcome to Action’s Antidotes, your antidote to the mindset that keeps you settling for less. Today, I want to talk to you again a little bit about our finances. Finances, not always everyone’s favorite topic to talk about because we’re really talking more about our passions, but finance, first of all, can be a source of passion for some people and also can be a source of power for people if people are able to handle their finances properly. My guest today, Zechariah Schaefer, is in the business of helping the younger generation of people handle finances. As you know, there are generational differences and different groups of people like to handle things differently and Zechariah has his own unique formula of not only helping the younger generation handle their finances but also bringing the service to people who are usually not quite served as often by the financial planning community. --- Zechariah, welcome to the program. Yeah, thank you, Stephen. It’s an honor to be here. So, Zechariah, tell me a little bit about your financial planning services. Yeah. So what I do is I run Ascent and Ascent is a registered investment advisory firm with a sister tax prep firm, literally, it’s just a sister firm for legal purposes and what we do is we help Gen Z and millennial really high performers to manage their money well, to manage the life resources well, to pay less taxes, still pay their fair share but not leave the IRS a tip, and then to invest wisely. And really our specialty is working with crypto investors and with tech professionals, we have equity compensation and the reason for that is simply I’ve been in the crypto space for almost a decade and before I ventured into finance, I was well on the path to becoming either a dev or working in cybersecurity, which I’m still very passionate about those spaces, they’re really cool. Yeah. So what makes someone a high performer? That’s how you phrased it, right? Yeah, so what are you looking for in a client? What makes someone that? Yeah, so the people who I work with, which we’ll get into this later in the episode I’m sure, but my passion really is helping people who can’t yet get advice. Gen Z and Millennial high performers, people who are really high income earners, usually $200,000 and up a year. They, surprisingly, are actually part of a group who can’t get advice right now because the traditional financial planning models are either focused on managing investments or selling products. And so if you’re a 25-year-old with a $300,000 total comp package from Meta and you also have a whole bunch of crypto, if you go to a traditional financial advisor’s office, what they’re going to tell you, if they’re one of the really high quality firms is what they’ll mostly say is, “We’re happy to meet with you for an hour, give you some tips, but come back to us when you have $5 million or $1 million.” And the reason for that, they do great work but it’s extremely profitable when you work with those people so that’s why they don’t accept people who have less assets. The difference is that I simply --- it’s basically a subscription and then, eventually, I do turn into that assets under managed model. The goal, eventually, however, is to --- most wealth management firms, what they do is, as they get bigger, as they grow, they work with people who are richer and richer and richer and reject everyone below. Fortunately, I’m going to have to do that to a certain point but then, the goal, like you and I talked about is to use the free cash flow, maybe some debt, maybe raise capital through equity raise and build an AI or machine learning-powered financial advice engine which is funded by the $1 to $2 million in free cash flow that gets a team of data scientists and software engineers to really build out that minimum viable products and what actually would happen is that the single mom with two kids who’s struggling, who needs tailored advice because their situation isn’t cookie cutter but doesn’t have the assets and doesn’t have the income to pay for it should be able to get advice in that scenario. And that single mom was my mom that’s why I’m passionate about it. Yeah. So, that was your story growing up and I’m guessing that’s why you have the passion that you do for getting financial advice to people who are traditionally, as you say, ignored by the financial advising community because you said, traditionally, in the financial advising community, they are just looking for the person who has a million dollars in assets or above to manage as opposed to the people who are just getting up and earning it or something like that. Yeah, exactly. And I started out with my business actually trying to help that group of people right away and I just realized that, really, there were two paths forward. It was either run a charity and help 60 to 100 families who are really underprivileged and do a great job for them and get paid pennies, which is very noble, if there’s anyone out there doing that, that’s great. But it’s either do that, which doesn’t fully solve the problem, or build this business and build something that is scalable where everyone wins. Because this AI advice engine that I’m talking about, this is years out and someone else may build it faster and that’s okay, but what it’s going to do, no matter who builds it, is it’s going to allow advisors to serve more clients and do a better more calculated job for them, and do it cheaper for the client while still getting paid either the same or more, not unlike travel agents, where people think the internet killed them. The Internet didn’t kill them, they just either specialized or the new era of travel agent, the virtual, one came in and that’s going to be the same thing I think with advice. You’re going to have this level of virtual advice with maybe a human touch and then, at the top end, you’ll still have fully human. So I think this is a situation that a lot of people find in business where you have to pivot a little bit and move toward maybe something that wasn’t your initial target but keeping your initial target in mind for a longer term. Is there a certain feeling you have around that and saying, “Okay, I did a little bit, something different, I’m serving a little bit of a different client than what I initially intended but I’m keeping going by knowing that this is eventually gonna get me to the place where I’m having the exact impact that I want to have”? Yeah, I mean, I think, for me, I just had to really work through it myself and just ask myself the question am I just selling out, because I don’t want to sell out, I want to help people who can’t get help. And so, right now, I am thankful that I still have the blessing of serving people who can’t get help, it’s just those are the 20- and 30-year-olds who are the most successful in their friend groups as opposed to the 20- and 30-year-olds who really need help but can’t get it yet because they don’t have high incomes. But the goal, eventually, with that end in mind, I’m comfortable with the decision that I made and I think it’s just necessary. Yeah, for sure. I had no idea that the 25-year-old who’s making $200,000, $300,000 a year still is unable to get financial help services. Is that because your subscription model is different than the other models? Does that allow you to get your pay off of the income someone’s currently making as opposed to the wealth they’ve already accrued? Yeah. So, essentially, if I’m an advisor that just manages assets and I just charge, let’s call it 1 percent, if I meet with that 25-year-old, the only way I’m going to meet with them is if I’m just starting out and just building my business. Because if I’m not, I already have 50 to 100 clients who have $1 to $2 million each, so $10,000 to $20,000 in revenue a year each or more and they’re sending me referrals so why would I meet with that young person? So if I do it, I’m still providing a really premium service with massive value and, therefore, I charge premium prices, my minimum fee is just under $5,000 a year, but if they’re making $200,000 a year, in my opinion, obviously, some people will disagree, but in my opinion, it’s a no-brainer because I’m going to do their financial planning, I’m going to do their tax strategy, their investment management. The tax preparation is included. Sometimes, that means me doing it, sometimes that’s my CPA doing it. And so the value is just massive there. Let’s say someone’s making $250,000 a year, for example, and they don’t have a nest egg yet, as some people refer to it, but they’re going to spend $5,000 a year and then you’re going to handle all these things....