Investing is Personal with Kelsey Willock and Alan Soclof | 7investing
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Investing is Personal with Kelsey Willock and Alan Soclof

June 1, 2021 – By Simon Erickson

Our very first 7investing principle is that investing is personal. We believe no one knows your investing style, risk tolerance, or future goals better than you do. As such, the “right” way to invest and the “best” stocks in the market will necessarily be different for each individual.

But many people still feel like they don’t understand the stock market or that investing is a game that’s rigged against them. And while financial literacy is certainly improving every year, there’s still a lot of work to be done.

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7investing founder and CEO Simon Erickson recently reached out to two ambitious leaders who share the same mission of empowering others to become better investors. Kelsey Willock is the author of Not Your Boyfriend’s Investment Advice, which encourages women to be more actively involved in financial decisions. Alan Soclof is the founder and CEO of Cruising Altitude, which aims to empower the Generation Z demographic to invest with a long-term horizon.

In this exclusive interview with 7investing, Kelsey and Alan chat with Simon about what prompted them to become entrepreneurs to improve the world’s financial literacy and investing acumen. Kelsey describes how women are different investors than men and shares her thoughts about inflation and cryptocurrencies, while Alan describes the mentality of younger investors and draws comparisons between investing and sports.

In the final segment, both Kelsey and Alan share their personal investing approach and advice for younger investors.

Publicly-traded companies mentioned in this interview include Callaway Golf (NYSE: ELY) and Viacom (Nasdaq: VIAC). 7investing’s advisors or its guests may have positions in the companies mentioned.

Timestamps

01:27 –  Introduction to Kelsey Willock: What are your goals for your financial blog?

04:37 – How are women different investors than men?

05:33 – Thoughts about inflation and cryptocurrencies

08:10 – Introduction to Alan Soclof: What prompted you to launch Cruising Altitude?

09:4 – An overview of Alan’s investing philosophy and sectors of the market he’s most interested in

18:49 – Group discussion: investing process, personal goals, and advice for new investors

Transcript

Simon Erickson  0:00

Hello everyone and welcome to this edition of our 7Investing podcast. I’m 7investing founder and CEO Simon Erickson. Those who know 7Investing know that we have seven investing principles. And the first of those principles is that investing is indeed personal. There is no one right answer to investing it’s okay to have different approaches. Whether you’re a growth style investor, an income investor, a value investor, there’s so many different approaches to the stock market itself. And I’m so glad to be welcomed by two of our network affiliates on today’s show who are also aligned with that same mission who also very much believe that investing is personal. My first guest is Kelsey Willock. She is the co founder and CEO of Tardi, a financial independence application that she created. She’s also the author of “Not Your Boyfriend’s Financial Advice.”

And I’m also joined by Alan Soclof. He is the founder and CEO of Cruising Altitude, also a financial newsletter to help people invest in the stock market and get a better hold of their finances. Kelsey and Alan. Hey, thanks for being with me here on the 7Investing podcast this afternoon.

Kelsey Willock  1:08

Thank you so much for having us.

Alan Soclof  1:10

Of course excited to be here.

Simon Erickson  1:12

Well, Kelsey, let’s start with you. You know, you have started a blog, which was “Not Your Boyfriend’s Financial Advice”, really aimed at getting women to be more involved in the stock market, can you tell me a little about what prompted you to create this blog?

Kelsey Willock  1:27

Yeah, so this past year, I left my job at Goldman Sachs to pursue a company called Tardi to get more women investing. Women currently make up only 8% of investors yet control 83% of buying power in the United States. I’ve always thought that the buying power of women is huge, but the investing power is untapped. And when I was conducting consumer research, I found that not only 84% of women feel misunderstood by investment marketers, but a topic that continued to come up was I just take my partner’s investment advice, or I just take my boyfriend’s investment advice. There was a major lack of autonomy when it came to finances. So that’s why I started my blog to make finance fun, accessible, something you want to learn about rather than you feel you have to learn about. And finally, I aim to reduce shame in regards to money. Many people think maybe my blog is just catchy titles and humor. But it’s so much more than that. It’s taking away the shame that women feel in regards to not only sexuality but they feel shame in talking about money, I aim to reduce and remove the shame from both with the subject matter.

Simon Erickson  2:38

That’s fantastic. And knowing that investing is personal if people have different styles, do you have any advice or coaching for couples that might have different opinions about how to invest in stocks, say that one partner of the couple wants to be a growth style investor really go for the goal of kind of find those tech companies, the other wants to be much more conservative or more of a dividend or safer type of investor? How can couples approach investing if they have different styles?

Kelsey Willock  3:05

Yeah, I think that’s where education comes into play. what’s right for your partner might not be right for you. And the only way you can figure that out is if you get educated first and find where your values align. I think so many people in today’s day and age, they get started before understanding, you know, what are my goals? What are my priorities? And what do I understand? So, where again, so much empowerment comes into play is educate yourself first, figure out what makes sense to you.

And something I also firmly believe is don’t invest in anything unless you understand it. And that takes time. And again, many partners don’t have the conversation, they often just tell their significant other this is what you should do rather than what do you think we can do? What are your goals? And where are they aligned? So it’s definitely an extremely personal conversation. But it starts by giving people empowerment to have autonomy over investment decisions, they don’t just need to listen to a partner. While they can make decisions in tandem, it’s often about what’s finding what’s right for each of them.

Simon Erickson  4:10

I have read your blog, it’s very educational. It’s an excellent, you did an excellent job of taking complex financial topics and distilling them down into a way that’s understandable and relatable for people. Back to the point that you said about really trying to empower women, you know, specifically this demographic. Do you feel without broad making this too broad of a generalization? But do you believe that there’s anything that women tend to invest differently than men when they look at the stock market?

Kelsey Willock  4:37

So not only is it my opinion, but statistics support it and they absolutely do. Women maintain around 71% of their wealth in cash in comparison to men that maintain around 60% in cash, and they often tend to be much more risk averse. I believe this stems from rhetoric women are told to save save save you spend spend spend too much Never to invest, invest, invest. And as a result, women take only about, you know, 4% of good financial risk in their portfolios, they’re more likely to be impoverished by retirement. But it firmly stems from fear and anxiety around investing and putting your money to work. Ironically, women are actually empirically better at investing. While the stats are very minor. It’s, you know, something around one to 2% that they are better investors. They just don’t know it and they don’t know how to take the appropriate risk due to the rhetoric and not being spoken to by many financial marketers.

Simon Erickson  5:38

That’s fantastic. Kelsey, one more question. Before I switch gears and go over to Alan, I’ve got to ask an out of left field completely off the wall question for you. I followed a lot of what you’ve been posting on Twitter. One of the topics has been cryptocurrencies lately. Do you have a stance or thoughts about cryptocurrency right now?

Kelsey Willock  5:53

Yes, and before I say anything on crypto, I want to be super clear. And that’s why I admire your podcast and organization so much. We all make money differently. So we should be able to invest differently. I think everyone should have emergency savings accounts be maxing out retirement funds have diversified long term portfolios. But we all accessorize differently. And I see crypto as an accessory. I personally speculate on it, I trade it. But with only a small sliver of my portfolio, I got comfortable with an amount I was fully comfortable losing. And I invest with a similar strategy as I do with investing in equities where I dollar cost average. And I diversify across cryptocurrencies.

That being said, I am highly skeptical of the marketplace and things like happen things like last night, and where we saw a dip from around 30 to 40% in the marketplace only proves that, you know, it is so speculative, and I am I’m even suspicious. So while I do think that if it makes sense to you, and you understand it, and keyword understand you should never invest in something if you don’t understand the marketplace. But if you do understand and you do your due diligence on you know, what’s blockchain? What are these cryptocurrencies? Who’s behind them, then I don’t see why you can’t take calculated risk in them.

Simon Erickson  7:17

It is certainly a volatile accessory. Indeed, when you’re talking about cryptocurrencies and Kelsey, for people that do want to have a better understanding of financials and the market, how can they get ahold of you? What’s your blog or your Twitter that you’d like to reach out to you at?

Kelsey Willock  7:29

Yeah, so my, my Twitter is @kelsmels1. My nickname as a kid used to be mels, because my brother could not pronounce Kelsey, you could only pronounce ‘melsey’. Um, and my blog is Not Your Boyfriend’s Investment Advice, you can just search it on substack. And that’s an easy way to follow me. And if you’re curious to follow along with my company, you can go to tardiapp.com if you’re interested in being a beta user,

Simon Erickson  7:54

Perfect, that’s definitely a great advice to getting people started thinking more about their financial future and getting more involved with financial concepts. Alan, let me bring this to you. You’ve also started a newsletter, Cruising Altitude, which is aimed, as I understand it, getting millennials more interested in investing.

Alan Soclof  8:10

Yeah, so basically, the goal of Cruising Altitude is to get Gen Z and millennials, we’ve gotten a little bit bigger. But the idea of those, say 18 to 35 year olds, people that are either starting to learn about the market, or making money to be investing long term. As everyone here knows the power of compounding growth is one of the greatest wonders in the world. And the earlier you start the early earlier, you start investing and learning the more valuable and bigger your assets can be when a retirement comes around. So that’s why we want to get started early and often.

And then on top of that, there is a both in life and in finance, a desire for thing, getting things quickly a lack of patience. And often in the market. And in life. The best things require patience and require consistency. So what we are really trying to do is preach that the stock market, it’s rigged in your favor, if you give yourself time if you do the proper due diligence on opportunities. And we want to make long term investment exciting too. It’s not boring, we can do and have some fun in the process.

Simon Erickson  9:23

Absolutely. And what a powerful time to start investing the power of compounding certainly, in your favor, the earlier and earlier that you get started 13 to 35, or I’m sorry, 18 to 35 year olds, you said it’s a lucrative demographic for much of the business world. Everybody wants to figure out how to appeal to Gen Z. How do 18 to 35 year olds think about investing in the stock market?

Alan Soclof  9:47

It’s a great question. I think for the most part, especially now, from my experience, not in the best way. The idea of putting $1,000 into something and or let’s say have $1,000 in your account, you put $700 in the market, and $300 in cash, philosophically, you want to see the stock drop, right. So you can get a little bit more and have a longer growth horizon. But people don’t have that patience, they get really nervous and really scared when they see their capital dropping. And I get that, I understand that. Because you don’t want to lose your money. But it’s important to realize just like when a stock is up, 20% you haven’t made that money. And just like when it’s down 20% you haven’t lost your money.

And it’s important to go in from day one with that long term perspective. And I think at the same time to its people from that 18 to 35 demographic are really willing to learn. And if you show them, hey, stick with me, trust me this works, especially when it’s just not me saying that. But I decades and decades of stock market performance behind me that people are willing to learn, it’s just a matter of finding a trusted source to kind of help them on their journey. And that’s the niche that we’re trying to fill.

Simon Erickson  11:11

We just saw a kind of the pinnacle of impatience in the market, with Wall Street bets, promoting GameStop. And everybody seemed to rush into this and then lost a lot of money. A lot of people were burned from the aftermath that came from this trade. Do you think that this story as a whole, which is fascinating in many ways, but just the overall concept of what happened with GameStop investors, was this a net positive in convincing millennials to invest long term because they could get burned? Or is this a net negative because they saw a bunch of people going out and making a ton of money really, really quickly? And they want to mimic that? What is your thoughts about GameStop? And how that has affected the thinking about the stock market for Gen Z?

Alan Soclof  11:53

Yeah. So a lot of people give a lot of different opinions. Of course, for a percentage of people this is good, because it had them focus on the market. But I think for the majority, it was not good. Charlie Munger recently had a quote, I think it was at their big, whatever they call it, in Omaha, but the Super Bowl of Berkshire. But he was saying how the worst thing that can happen to you is making money from a GameStop or a crypto currency. This isn’t my opinion, this is what he said. And I think that so that’s the worst thing that can happen, because then you’re going to be looking for the next GameStop, the next crypto currency. And I think that’s where it can become very dangerous. So it’s really interesting for myself, personally, to watch how I developed I’ve been investing my dad got me into it when I was really young. I my own account when I was 13. But thing things have really changed and I don’t think for the better, I lost my thought process there. But I do not think GameStop is good.

Simon Erickson  13:03

I agree. Yeah, certainly certainly some aftermath of collateral damage. Oh, go ahead.

Alan Soclof  13:09

Yeah, it takes you away from the long term perspective in goals that you should have when investing in the market. I have really, I don’t get to oper down by the day to day of the market because I’ve chosen stocks. I’ve researched stocks that I like and I know for the thesis to come true, it takes years and not days and months.

Simon Erickson  13:32

Perfect and my off the wall out of left field question for you Alan I know that you’re a sports superstar. Do you draw any comparisons? I basketball I believe is that right out on your basketball player?

Alan Soclof  13:42

Back in high school I was a tri-sport athlete.

Simon Erickson  13:44

Tri-sport, okay, I stand corrected. Okay. Is there any comparisons that you draw between sports and investing?

Alan Soclof  13:49

Yeah, 100%. I think there’s three that come to mind. One is management matters, right? Who is the GM of the team who is the coach of the team, especially being a Cleveland Browns fan. We have not been blessed with the best management over the years. But it looks like we’re finally in the right direction now. But when you’re talking CEOs of companies. As an investor, you have such little impact, if any, on what is happening in the company. So two of my favorite companies are Viacom, CBS and Callaway golf. I know way too much about my Robert Bakish, their CEO, I know too much about their CFO Naveen Chopra I know too much about their chief streaming officer Tom Ryan, I need to know GMs, I need to know the coaches who is making these decisions

Callaway golf Chip Brewer, their CEO, when you look at his history and what he’s accomplished, whether with Adams golf, or Callaway golf, the writing is kind of on the wall, especially if you pair it with good fundamentals and the good product of the direction of the company. And I think that’s the same with sports. And then I’ll just throw one more in here. Patience, patience, and patience. Especially with younger talent, you can equate it to growth stocks, right? They’re gonna have really good times really bad times, but the most important thing is being patient. And same thing with stocks that don’t get too high when the top prospect has a great game, don’t get too low when he has a rough game. Give them time, trust what you saw in him when you originally drafted him. And, obviously keep an eye on his development. But yeah, I think those are a couple similarities.

Simon Erickson  15:31

Yeah. And I’d like to open this up to a couple questions I’d like to ask to both of you here as we close out the podcast. I might start with Alan, because I think this is a continuation of what you were just describing Alan. But my first question is really, what type of investor do you self describe as and why are you investing in the market for your future goals? What goals do you have that you want to invest to achieve? So Alan, go ahead if you continue your previous thought?

Alan Soclof  15:54

Yeah. So I think to answer that, truthfully, my philosophy is developing and evolving. And I think that’s great. I think, I think it’s a problem. If I’m sitting here at 23 years old, saying I have all the answers. I am so open to learning, I’m confident in my approach. So I see my approach, really, two-prong. I have a portfolio of growth stocks, and then a portfolio of more GARP stocks, growth at a reasonable price. My growth stocks, I’ve much more a 10 year vision. And I think that’s a benefit that I have of being so young. And I think if Warren Buffett and Munger are investing for forever, at their ages, I think all of us can do that, regardless of our age.

And then a more fundamentally driven portfolio, like a Viacom CBS, Callaway golf, which I follow very closely and really try to understand why the fundamentals aren’t baked into the stock price. I’m more passionate about my GARP portfolio, because I think in many ways, that needs to be a little bit more actively managed, then a growth portfolio. And then one more philosophy, personally, is I am focused on or owning fewer stocks than many stocks. I think, as Kelsey said earlier, you really want to know what you’re investing in. And it’s hard to know a lot about many, many different things. And I believe I think there’s many different ways to approach it. But I believe in fewer stocks than many stocks and knowing your few stocks.

Simon Erickson  17:30

Perfect. Yep. And GARP is growth at a reasonable price that you heard Alan talking about, right there. Alan any concrete goals that you’re trying to achieve with your investing?

Alan Soclof  17:40

Oh, I think, yeah, I think eventually, it’s financial freedom. I know a lot of people say that, but I think – eh, I’m gonna take that back. I think my goal is just to put my money in good places, because I read a phenomenal article this morning about the best thing you can be doing as a 23 year old is focusing on income and generating cash, right that if I make 50% or 80% on a stock in a $1,000 portfolio that’s very different than a 10 or $50,000 portfolio. So right now, I think I’m I am really focused on my fundamental approach, my process, to finding stocks.

Simon Erickson  18:22

Good answer, Alan, I thought for a second you were gonna say buying the Cleveland Browns and I hear that they’re probably in a bargain right now. Maybe that’s growth at a reasonable price for you.

Alan Soclof  18:30

Guess what? That’s still the dream.

Simon Erickson  18:34

Value value stock for you. Okay, Kelsey let me bring this to you, too. Can you tell me a little bit about your investing process personally as an investor?

Kelsey Willock  18:41

Yeah. And maybe I’ll answer also the question you asked Alan, first of why do I invest?

Simon Erickson  18:48

Perfect.

Kelsey Willock  18:49

It’s wealth creation maintenance for me. And I think people forget that investing isn’t just making more money. It’s beating inflation. You know, if you keep your money in cash, it does you no good. Unless, I mean, there are high yield savings account that do some good, and they allow you to maintain an emergency savings account. But beyond that, inflation only decreases our buying power over time. And I’m highly aware of that, you know, $100 today is not going to be what $100 is worth in 20-30 years. So it’s always been for me not only beating inflation of 2% year over year, I always think of my benchmark being you know, the S&P 500 like any classic hedge fund.

I worked in the hedge fund industry for five years. So, I’ve always looked at my investment or my portfolio over the long term. It’s highly diversified and probably a little bit more boring. I have a mix of ETFs are across US emerging markets, both value and growth stocks, and I also have a mix of investment grade fixed income. I add in investment grade fixed income because I recently quit my job. So I know for a certain amount of time, I have no income. So I wanted to shift my portfolio from being extremely aggressive to being slightly more conservative.

That being said, I did not sell out of all my equities because I still wanted to make my money work for me during the time period in which I was working to generate an income with my new business. But yeah, I scaled back risk. But I still always believe in taking calculated risk. And I guess I don’t know if I’ll mentioned but some of the companies or the ETFs, I look at are you know, $QQQ and $ARKK and $IJH, $ARKK I’m a massive fan of Cathie Wood. So yeah, it’s really and on a on a monthly basis, when I was making a monthly income, I would just rebalance my portfolio based on the allocation that I had set for myself, which was, again, a mix of US and emerging equities, or non US equities and some, some bonds.

Simon Erickson  21:07

That’s perfect. Kelsey, so you pointed out several times that there is a difference between wealth creation and wealth maintenance, you’re always trying to beat inflation, of course, as the minimum so you’re not decreasing your purchasing power over time. But you also like the idea of having it support your lifestyle, support your goal of empowering women investors, younger investors, whoever it might be, and kind of living the lifestyle that you want for a long period of time.

Kelsey Willock  21:30

Exactly. I feel that, you know, I can’t preach this to women, if I don’t practice what I preach. And I firmly believe in investing. I think that you know, education first being a part of the conversation next, and then action is the last you can take. So educate yourself, you know, start to ask questions, step into the conversation, even though it’s intimidating. And once you start to get more comfortable, you will take action, and the actions only going to benefit you if you’re you know, invested appropriately.

Simon Erickson  21:59

Perfect in my last question for both of you is going to be for one piece of advice to your audiences today. And Kelsey, I’ll come to you first on this, of course, to give you a little bit of time to prepare this are an audience at 7Investing is individual investors, mostly, we talk a lot about trends, we talk about styles of investing, we talk about more important longer term things they should be thinking about. But if you could just tell one thing to your audience, that will also be listening, hopefully to this podcast on our 7Investing podcast, what would one piece of investing advice be from Kelsey Willock?

Kelsey Willock  22:33

Don’t get intimidated by people that tell you what to do. Because investing is so personal. I met with a woman today who was like, how do I get started? And I just asked her the questions you asked me today, what are your goals. And if people aren’t willing to ask you what your goals are, they really shouldn’t be in the business of telling you what to do. They should be asking you what works for them and find the communities that you engage with. You know, I think finding people that align with your values is also so important in joining in the conversation with them. If you want to start actively investing, then, you know, engage in communities like Alan’s. Engage in communities where people are talking about active trading and align your values with people that you agree with, you know, if those people are people that are much more conservative than follow along with them. It’s all about finding what’s right for you and what you can tolerate. And it’s finding comfort because money is stressful. Money is risky, money is uncomfortable. So it’s all about reducing stress and finding what’s going to make you the most happy long term.

Simon Erickson  23:44

That’s a great answer, Kelsey, don’t be intimidated. Alan, let me bring it to you. But before I ask you the question, I’d like to give you a chance to talk about your community too. How can we find you on Twitter or with Cruising Altitude?

Alan Soclof  23:54

Yeah, so you can follow me on Twitter, just my name @AlanSoclof That’s A l a n S o c l o f. And then the link to the substack for Cruising Altitude is in my bio. So I think that’s the easiest one.

Simon Erickson  24:10

Perfect. Yeah. And what’s one piece of advice you’d give to the audience listening to the podcast today?

Alan Soclof  24:14

Yeah, I think that the power of patience, and the ability to be patient is so integral, especially these days, I think, both for investing and in life, I think it’s important to surround yourself with long term thinkers doing things like turning off your phone for a little bit here and there going on walks to actions that lead to patience being rewarded.

Simon Erickson  24:35

That’s fantastic advice, as well. Kelsey, and Alan, it’s really been a pleasure. Thank you both for joining me here on the 7Investing podcast today.

Kelsey Willock  24:43

Thank you so much for having us Simon. We’re so grateful to be here.

Alan Soclof  24:47

Thank you, Simon, you’re the man.

Simon Erickson  24:49

We have a lot of fun with this. I think that it’s really important to realize that investing is so personal. And it’s not just all about 7investing. This is why we want to partner with great organizations like Alan and Kelsey have. We’re trying to spread financial awareness and make people into better investors. We think that there really is something to this you can compound wealth over time that really empowers you to do great things in your future as we’ve talked about here today. So thank you. I hope this was enjoyable and also educational for everyone listening. And once again, we are here to empower you to invest in your future. We are 7investing.

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