Today's episode is all about asset allocation and asset location. It might not sound as fun as the Netflix show you're watching, but I hope today is equally, if not more fun. And I'm going to start with an example for you guys to understand why. So client came to me. They were 83. And they came and they said, Ari, how much should I have in equities? What should be my asset allocation? And I said, you should have 100%. And they're like,

what are you nuts? I'm 83. I'm like, it's a horrible recommendation. Like, then why do you say it? It's horrible for your neighbor that doesn't have two pensions, social security, rental income, and inheritance that's coming in. So for you, you have enough that you're going to be okay. Meaning if you have $3 million in your portfolio,

if it went to zero, I know you wouldn't be happy with me. I understand that. But you would be okay,

meaning you would be able to pay the bills, you're still going to travel, you're going to be okay.

Your neighbor that does not have pensions in Social Security and rental income, they cannot have

this asset allocation, meaning it would be

way too risky because now they run a big risk, which is markets go down, they need to sell things

at a loss, which is going to impact their income for the rest of their retirement. So the point of

the little silly story there is, even though it's true, is I want to make sure, you know,

don't have a cookie cutter approach to retirement planning, specifically asset allocation. So asset allocation is a fancy way of saying how much should be in equities and fixed income and cash. And most advisors stop right there and go, hey, you should have 6040 or 70 30 or 80, 20. I don't subscribe to any of that. I don't do this cookie cutter approach. I think you need to go a whole lot

deeper. Not because if you don't, you won't be okay. You would be okay. You'd just be leaving a lot of money on the table. So we're going to be exploring today. What is the right way to think about this? How much should I have? And when is too much enough? And all that important stuff that most people go, hey, I know I've been meaning to update my allocation.

And I just don't know how soon should I update it before I retire. Do I need to change anything right now? All that good stuff. So I'm going to walk you guys through how to do that now. We're always, as I mentioned, going to start with fun reviews of the week and keep this engaging as much as I possibly can because, look, I get it. Now, a lot of you are awesome.

You're like, listen, all right, I wake up and I'm like, oh my God, it's Monday.

I've got an episode of early retirement. as much as I possibly can because look, I get it. Now, a lot of you are awesome. You're like,

listen, all right, I wake up and I'm like, oh my God, it's Monday. I've got an episode of early

retirement and I'm excited. Now, a lot of you do send me messages going, hey, it's really helpful. I enjoy it. But, you know, I do want to watch my Netflix show. And I'm not going to sit here and go, hey, my content's more entertaining than that.

I hope it's educational, but I also don't want you going, oh, well, it's kind of just,

I'm only going to get educated and I'm not going to. go, hey, my content's more entertaining than that. I hope it's educational, but I also don't want

you going, oh, well, it's kind of just, I'm only going to get educated and I'm not going to kind of be entertained along the way. So I do my best to keep a balance of both of those. So what I want to do today, I've got a few fun things to share. Now, I just gave you that kind of a little story there, but I'm going to go a little deeper while I pull something up because here's what I want you guys to know.

Asset allocation is level one. Asset location is level two. Let me explain what this is so you guys fully understand. And if this is your first time to the show, welcome for most of you. You guys are longtime listeners. But if you're new, my name is Ari Talbib. I'm a certified

financial planner. I am the host of this podcast, early retirement, and I'm the vice president at Root. And I want to make sure you are optimizing what you've worked so hard for. So, thank you for being here. I know there's a lot of different podcasts out there, and you guys have chose to be with mine. So thank you very much. Now, I'm pulling something up, but while I pull this up,

I want to show you guys a few different things. So here's what I'm excited to talk about today. Sometimes while I'm speaking, you know, I do my outlines for the episodes. And then sometimes I'm like, yep, screw that. There's something else I want to show you guys. And I think it's going to resonate more, which is why hopefully you're tuning in. So I'm going to explain asset location,

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