It’s tempting right now to become preoccupied with the markets, but there is little we as individual investors can do. What we can have more control over, however, are decisions we make in the run up to retirement, which will have a significant impact on our retirement security. These decisions include when to elect social security, what fees we pay on our investments, working part time in retirement and being tax efficient in how we withdraw funds in retirement. Being smart about these decisions can add years to the life of your retirement portfolio.
As a part of my series about “Investing During The Pandemic”, I had the pleasure of interviewing Rhian Horgan, the founder and CEO of Kindur.
Kindur is an SEC-registered investment adviser dedicated to helping retirees feel prepared moving into retirement. We provide smart, automated advice to personalize your retirement strategy so you can manage your savings with confidence. Prior to becoming CEO of Kindur, Rhian worked for 17 years at JP Morgan where she advised families. She has been quoted in “The New York Times,” “Forbes,” CNBC, and the “Retirement Income Journal.”
Thank you for doing this with us! Before we dig in, our readers would like to learn a bit more about you. Can you tell us the “backstory” about what brought you to the finance industry?
Ihad been working at JP Morgan for 17 years when I started interacting with an emerging group of financial technology companies. What impressed me the most was their user experience — they made financial topics so much easier to understand than most of what I had seen on Wall Street. At the same time, I was helping my parents plan for and transition into retirement. I found myself buying a 300-page book on social security and realized that there was a huge gap in the market. There are 10,000 baby boomers retiring every day and no one was building consumer technology to help them retire fearlessly. And that was the beginning of Kindur, a financial technology company dedicated to helping baby boomers live their best retirement.
Can you share with our readers the most interesting or amusing story that occured to you in your career so far? Can you share the lesson or take away you took out of that story?
In the early days of Kindur, we thought about building a platform that was focused on supporting family caregivers who were making financial decisions for Mom and Dad. However, as we were conducting user research, each caregiver started reflecting on their own retirement and how different it was to their parents’ experiences. As we listened, we realized that we had an opportunity to build a solution to help baby boomers navigate their own retirement. It taught me very early on how important it was to listen to your user and make sure the product you are building actually solves their needs.
Are you working on any exciting new projects now? How do you think that will help people?
Three years ago, I founded a financial technology company called Kindur, which is dedicated to helping baby boomers retire fearlessly. We recently launched a new app called Silvur. It was that is designed to help baby boomers weather the storm and it allows you to to do 3 things:
- #1 Create a plan and understand how key decisions like part time income, retirement date and social security elections can impact your retirement income.
- #2 Stay informed with timely content on topics like the CAREs Act, borrowing from 401ks, and adjusting to having your kids (back) at home!
- #3 Save while you shop so that the savings fund your future retirement. In today’s uncertain times, we hope to bring a silvur lining.
None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story about that?
In 2008, I had just started a new role when the financial crisis started. My first customer was an internal customer (a group of financial advisors on the west coast). Amidst the emerging crisis, there was extra pressure for me to quickly get up to speed on a number of the economic recovery packages that the government was launching. Everything was new, which led to a steep learning curve, frustrations and long hours. But it was worth it. My main customer at the time not only gave me the space to learn but also wanted to make sure I didn’t feel overwhelmed. I remember him suggesting that I talk to his team on a conference call with my notes readily available… and then, when I was feeling more confident with these new topics, we could transition to a video call (where eye contact and visual confidence would be important!). He gave me the space to learn quickly but also set me up for success with his team. Ultimately, he became my boss at the bank and an angel investor in my company Kindur.
Let’s shift a bit to what is happening today in the broader world. Many people have become anxious from the dramatic jolts of the news cycle. The fears related to the coronavirus pandemic have understandably heightened a sense of uncertainty and loneliness. From your experience, what are a few ideas that we can use to effectively offer support to our families and loved ones who are feeling anxious? Can you explain?
I encourage my friends and customers to focus on the things they can control. It’s tempting right now to become preoccupied with the markets, but there is little we as individual investors can do. What we can have more control over, however, are decisions we make in the run up to retirement, which will have a significant impact on our retirement security. These decisions include when to elect social security, what fees we pay on our investments, working part time in retirement and being tax efficient in how we withdraw funds in retirement. Being smart about these decisions can add years to the life of your retirement portfolio.
Ok. Thanks for all that. Let’s now jump to the main core of our interview. As you know the stock market and the economy in general have become extremely volatile and uncertain. Many people “dollar cost average” and put aside a monthly sum into a long term savings plan for retirement, college, or a home purchase. If a loved one or a client came to you and said, “I have been saving and investing $500 every month in an S&P 500 index fund. Over the next few months until the dust settles, should I be doing something else with my money?”, what would you say to them?
For most investors, being disciplined pays off over the long run. It’s really hard to time the market, and drawdowns like we are currently experiencing give you the opportunity to effectively put more money away for the future and to stay invested. That’s one of the reasons why the IRS eliminated RMDs (required minimum distributions) for 2020 as part of the CAREs act. They realized that forcing investors to take money out of their retirement savings at this moment in time was unlikely to be a wise long term strategy.
Eventually the economy will recover and rebound. Certain sectors, like travel and hospitality might be hurting for a while. But other sectors, like technology and healthcare, might do very well. If someone wanted to prepare today to take advantage of the future recovery, what would you suggest they do?
The most important thing is to have a plan. And this plan should extend far past which sectors you are investing in. For example, if you are planning to retire in the next 3–5 years, it’s likely that social security is your largest retirement asset and thus, the most important decision that you will make.
Are there alternative investments that you think more people should look more deeply at?
Anyone who thinks they are healthy and looking forward to a long life should seriously be thinking about longevity insurance, especially as Baby boomers are living 10 years longer than their parents. The starting point for longevity insurance is your social security benefit — it increases by 8% every year you defer between 62 and 70- and fixed annuities. Both social security and fixed annuities provide you with a guaranteed source of income, whether you live to 80, 90 or 100.
If a person in their thirties and forties came to you today and said that they have $10,000 that they want to put away today for a long term investment what would you advise them to do with it?
If you are in your thirties or early forties, you still have a long way to go before retirement. The good news is that this gives your savings time to compound but it also means that you will be fighting inflation (i.e. goods and services will cost more in the future). That’s why I often recommend to those that are earlier in their careers, and have an emergency fund in place, to set aside funds for medium term goals (perhaps home ownership), which have a balance of equity and bonds… and for the long term goal of retirement a more significant allocation to equities. If you are saving early for retirement, you will likely have time to weather the storm.
Can you please give us your favorite “Life Lesson Quote”? Can you share how that was relevant to you in your life?
It’s a marathon, not a sprint. While my team works in ‘two week sprint cycles’ to deliver new features to our customers, the reality is that our customers are making decisions that will last a lifetime… and this means that they will be purposeful in how they make decisions. We need to prepare them for the marathon but deliver value every single day.
You are a person of enormous influence. If you could inspire a movement that would bring the most amount of good to the greatest amount of people, what would that be? You never know what your idea can trigger. 🙂
Democratization of technology. The pandemic has highlighted to me the tremendous inequities today around access to technology. Even in the great city of New York, one month after the public schools have closed, thousands of children don’t have internet access or devices. It’s happening in my own kids school and risks a generation of children being left behind. The internet has become a basic utility and we need to ensure access for all.
Thank you for the interview. We wish you only continued success!