The Fiduciary U™ Podcast

Josh Itzoe (00:01.814)
Nate Moody, welcome to the fiduciary you podcast, man. I'm so excited that you agreed to be on the show. I think we're going to have a really good discussion.

Nate Moody (00:16.16)
I'm excited. I'm looking forward to today's conversation.

Josh Itzoe (00:21.258)
Awesome, awesome. We just prepped a little bit. I think we have some really cool paths that we can kind of go down. I feel like what I love about you is you're very active on LinkedIn and you have really good spicy takes in a lot of cases that I like, but that...

you know, aren't spicy for the sake of, you know, being spicy. I think your takes, it's very clear that you think deeply about this business. And a lot of your perspectives tend to be counter from what I think the the prevailing wisdom is. And every time I read stuff that you post, I don't agree with everything, but I find myself agreeing with a lot of what you say. And I'm like, that's a really good perspective or that's a really good way to kind of position this. That is

that's counter so I can't wait to kind of get your to kind of get your just your thoughts on on some things happening in the industry, but maybe a good place to start for people that don't know you or aren't super familiar is why don't you just take a minute or two and provide kind of your background, how you got into the business and how you got to the point where you are.

Nate Moody (01:38.71)
Yeah, no, it sounds great. So I'll start because I think it actually helps explain sort of why I'm as evangelical as I am at times. So I grew up in a sort of family owned business type environment. My dad, we were chatting before, started his business when he was in high school to collision repairs. So he started off basically helping to fix vehicles and had always been a very, I would say, servant style leader and was very paternalistic.

around sort of what your role is as a business owner as it relates to your coworkers. And that very much is integrated into how I view our role as in some cases a caretaker of our clients, employees, financial world. So I just want to kind of start there. So that was sort of the world I grew up in. always was very entrepreneurial by I think nature. I knew I wanted to do something in the realm of math or finance. That was what I always gravitated to.

I just went to a small public school in my hometown in Gorham, Maine. Went to college in Maine as well, a school called Bowdoin. Did a couple internships while I was there. I started to kind of narrow my focus into the financial advisory space. And then it was actually my senior spring that I ended up interning at the firm I work at today, LeBell & Harriman.

At the time, know, we're joking, I couldn't even spell 401k. There's, nobody in the history of 401ks has grown up wanting to work on 401ks as a kid. Started to get exposed, not just to 401k plans, but really just the culture of LeBell and Harriman and some of the people here and both co-founders at that time were still working here. Ended up after I graduated thinking I wanted to go to Boston and New York City, which is where, you know, lot of my peers from Bowdoin were heading and...

I knew I wanted to stay in the financial advisory world. And it was actually my dad who sort of pulled me aside and say, hey, listen, if you want to be in this business, it is very much a relationship focused business. And just like compound interest, and the earlier you start, the better. The same is true with building out a network. And I knew at some point I wanted to come back to Maine, raise a family in Maine, whatever the case, settle down in Maine. And so he sort of basically made the point of, if you stick around here, you're going to be that much further.

Nate Moody (03:53.058)
than a lot of your peers. Not that you wouldn't learn a ton going out to the big city and sharpening your teeth there. And I thought for once, wow, that's actually pretty good advice. And so I decided to stick around, start working at LeBell & Herriman as an analyst on what was then our retirement plans team. Did that for three years, got licensed, became one of our retirement counselors, which is really what we call our kind of education-focused and participant-focused individuals within that team. Then transitioned into an advisory.

So working directly with plan sponsors and then transition into a director of business development role alongside maintaining my advisory role. And then in 2023, bought out one of my major mentors in this industry, Mike Labelle as part of his final succession plan and became one of the partners and owners here. So I've been here about 10 years now and that I think brings me to here.

Josh Itzoe (04:43.256)
That's awesome. That's awesome. What attracted you to the employer side as opposed to maybe the personal wealth side?

Nate Moody (04:49.186)
Ahem.

Nate Moody (04:52.898)
Yeah, I would say two things. One, know, I always growing up in sort of a business focused household. I just was always around business owners and I just loved the opportunity to get exposed to all these different at times random businesses that we work with at LaBelle & Herman throughout the state. But then I would say, you know, over the course of my tenure here, what I've come to really fall in love with and this is partially kind of informs some of my LinkedIn posts and whatnot is

You just have such a unique opportunity when you advise on a company's financial and retirement benefits to have an outsized impact on the world and certainly on your community, right? Not to say that working with individuals and families, you're not building a really strong intimate relationship, but when you're able to help a business owner or, you know, organization add automatic enrollment, change out investment option, lower their fees.

You're not just impacting the organization. You're helping, in some cases, hundreds, if not thousands of underlying participants. And you don't get the same level of like one-on-one gratification. Like, I don't think I've ever had a participant come up after 40 years and be like, hey, thanks for your auto-enrolling. But if you step back, that multiplier effect, when you start to aggregate that marginal impact you have across each of the participants, and we're at the point now where we're managing over like almost 100,000 participants. I mean, that's just an

Josh Itzoe (06:08.12)
Right?

Nate Moody (06:22.494)
unconscionable potential impact we're able to have. And most of those folks are right here in Maine, which are the people that really get me out of bed every morning. So that does really what's always kind of gravitated me towards that. And I feel like it is very strategic in a number of different ways and you're constantly being pushed. mean, our industry is just evolving so much in the last 10 years, whether from technology or regulatory updates. It's just it's a fun time to be in this industry, at least from my perspective.

Josh Itzoe (06:49.774)
Right? Yeah, it's so funny you saying that. mean, that's when we started our RIA back in 2004, we were all private wealth and which was great. And we were going after kind of that, that, you know, massive fluent, you know, high net worth, not ultra high net worth, but high net worth individual was great. We had these deep, you know, you you impact kind of fewer people, but you go deeper because you just have the ability to do that. But one of the things that attracted me to the 401k side

when I really, you know, a couple of years in kind of fell into it was exactly what you said was this idea of I felt like we gave really good advice. And I was like, you know, if we could now go in and you know, you work with a, you know, a married couple, like you can impact them and maybe their kids, but I'm like, you go into a company that has 100 people, you know, you're going to start to multiply that impact that you have. And being able to kind of, you know,

scale that and I love what you said it's probably in a less personal way but in a really you know everything compounds right and so

Nate Moody (07:59.158)
And I'll just even add to that, Josh, too. I think the piece that gets missed sometimes as well is the types of people you're able to help by working through the 401k is very different than on the private wealth, right? Especially today's day and age, where every private wealth team has a minimum $500,000, a million dollars. There are so many folks out there who desperately need help, but nobody is willing to work with them or they price themselves out of that market. And so I think that's one of the really unique

Josh Itzoe (08:07.254)
Right. Absolutely. Absolutely.

Josh Itzoe (08:17.737)
That's right.

Nate Moody (08:28.372)
Attributes of the 401k or sort of a workplace retirement model is the ability to still reach and provide guidance to those Employees who candidly often need the most help and they end up getting the least so that's kind of that extra piece too It's not just the breadth of impact But the types of people you're able to impact and those are the people that are honestly like I don't this is a trope But are truly salty earth like working their tail off

for these businesses just to put food on their family's table, just to be able to set themselves up for retirement, their family up. So that's the stuff that gets me pretty jazzed up.

Josh Itzoe (09:03.598)
Yeah, no question about it. And I always thought, you know, I, when we started, and this was, you know, 2005, late 2005, early 2006 is when I really started to kind of go after the 401k market. And, you know, I really thought of it, it was, you know, at the time, it was like, you know, we had like, five people in our firm, and I was the only one doing this, and I didn't have a lot of scale. And so I started it, you know, back then, it's commonplace now, but like the idea of like, really in, I thought about it as

leverage points and how do I leverage a committee of maybe three or five or seven people who are going to make decisions for 100 or 200 or 50 or five, you know, 1000 people. And how do we kind of like get the most leverage and it's funny what you said. I used to tell our team like, we work for the thank yous we're never going to hear and you kind of got to be okay. You kind of got to be okay with that or the very few thank yous that were that we're going to hear.

Nate Moody (09:53.218)
Mm.

Nate Moody (09:57.388)
Mm-hmm.

Josh Itzoe (10:02.112)
What did you, and so obviously there's been a lot of evolution and a lot of change within the industry. Some of it, you know, some of it good, some of it not so good. What do you, like, what would you say are the two or three biggest things that you've kind of seen how the industry's changed over the last decade?

Nate Moody (10:26.786)
I came in right on sort of the tail end of contingent deferred sales charges and rev share all over the place, variable rev share, Hancock signature class 1, 2, 3, 4, 5, et cetera. I came right on the tail end of that. And as an analyst, all I was doing all day long was dissecting 4 AB2s and 4 4 8 5s and trying to make sense of like, wait.

this person's paying this person who's then credited back here, but then we're using it offset. So, certainly I think a push towards transparency, but then I've also been sort of at that, like I'm at that perfect point in the industry where I saw the last little bit of this and I'm also starting to see a little bit of this, right? Which is we're heading a hundred percent. So I know that's something we'll probably end up covering and sort of teasing out a little bit, but that's been a really interesting sort of at that direct inflection point.

Josh Itzoe (11:12.334)
starting to come back. Yeah.

Nate Moody (11:22.954)
of going like fully transparent. Your record keeper is your record keeper. Your TPA is your TPA. Your advisor is your advisor and your investment manager is your investment manager. And now those lines are starting to blur again, which is interesting. So that's it. I think a really interesting one. I would say just the technological advancements within sort of the ability to deliver either education or financial wellness. And I understand that financial wellness, you know, for a lot of folks.

feels like a buzzword and I'm sure in some cases it is. But that does not, I would say, take away from the fact that it is highly, highly needed out there. I mean, we do financial education all the time and the level of financial literacy, or guess lack thereof, is pretty appalling. And that's really where financial security starts. Now there's a component of that that really has to take place in the classroom as opposed to when you're 40, 50 years old.

That being said, think it's, really fascinated, particularly now with the advent of AI, is how do we deliver education and financial guidance in a much more efficient and sort of on-demand type, right? We sort of joke, you know, particularly with respect to education, you know, it feels really good to lead a horse to water, but sometimes it's more effective to just force feed them.

the water. And so in this world of TikTok, like people don't want to be taught what to do. Sometimes they just want to be told what to do. And so how do we create or remove as much friction as possible to get into that? So that, maybe is the second one. And then, you know, lifetime income, you know, say what you will. I've at times probably, you know, been a skeptic and I am continue to be in some cases of those type of products.

But I think there is a huge, huge need for addressing that distribution phase of participants' lives. And ironically, that was what pension plans did a really fantastic job of. Now, how exactly they're going to sort of shake out in terms of whether they're embedded in a targeted fund solution, treated as a distribution option, whatever the case. But I do think that that is the next big.

Nate Moody (13:36.54)
necessary evolution of our spaces. right, automatic enrollment has done a great job getting people into plans. Automatic escalation has done a great job getting them saving more. Targeted funds have done a great job getting them allocated appropriately. Now, what do we do once they retire? And that's that piece that obviously lifetime income is really specifically geared towards. And so I'm excited to see how those products evolve and how plan sponsor uptake looks.

Josh Itzoe (14:02.638)
So talk a little bit about just, as you mentioned, I mean, think we're still in very early innings. It's interesting in doing this, being in the industry for 25 years and seeing is you tend to, it always takes longer for things to get adopted than you anticipate. And typically it happens in the large market and then it starts to work its way down. Automatic features is a great example.

What do you see in terms of, what do you think about lifetime income? Two questions, I guess. One, do you think most people are gonna stick in plan once they separate from service? So from that standpoint. But then the other is, there's a lot of different kind of bites at the apple that the industry's kind of solve for this.

is funny, I think two years ago, three years ago at Napa, I mean, every session was like guaranteed income. And like the industry was really excited about it. But in terms of like plan sponsors seem like still a lot of kind of trepidation. And I think that's still probably an issue is that it's still on the front end and whether it's product evolution or maturity or demand at this at this point, you know, a rough turn in the markets could probably

definitely help help the guaranteed income folks. But what do you think just in general, like solution wise, like if you're out, how are you talking to clients about it in terms of at least getting it on their radar? And, you know, if or do you have many clients who've adopted it yet? I guess is a good question. And if so, like, what do you think the the most effective structure, maybe the most effective structure for the types of clients that you guys work with when it comes to guaranteed income?

Nate Moody (15:59.776)
Yeah, so we have not had any clients and we work with a little over 250 retirement plans today really jumping into this space with maybe the exception of some of those, you know, TIAA plans that already had some form of lifetime income annuity option available. And honestly, I think the biggest impediment hasn't been the market, hasn't been education, hasn't been any of that. The biggest impediment in our perspective is Secure 2.0.

And our plan sponsors only have so much capacity for change. And as the rules and the administration around retirement plans continues to get more complex, the thought of adding a potentially very complex, nice to have instead of just focusing on their have to haves, I think has just been a non-starter for a lot of our clients. I think that's partially the reason why you see some of these solutions start up market, because they have entire.

teams of people focus on the administration and it's often very different people than the ones that are serving on their committee making these decisions. Whereas when we're working with a smaller medium sized business, that director of HR who's in charge of administering the plan is usually on the committee. And then usually the first one that says, hey, I'm all for helping our people out, but we're pulling our hair out just trying to navigate Roth ketchup, super ketchup, like.

all of these other things that have been put on our plate. So that's, think, the biggest reason why we've seen a delay in adoption around lifetime income. Now...

Josh Itzoe (17:29.912)
So there's some real decision fatigue and probably implementation fatigue by clients.

Nate Moody (17:32.546)
Correct, 100%.

100%. And I don't actually view it as necessarily a bad thing because I think the next major hurdle for us to overcome is even though there's this safe harbor that's provided for under secure 1.0 for plan sponsors looking to add lifetime income solution as a fiduciary and as an advisor, it's really challenging for us to recommend something without a track record.

without a great peer set to compare it against, right? Like this is like the core of what we do is like analyze the marketplace, provide, you know, similar benchmark and peer data. And without any of that, it's really hard for us to guide our plan sponsors to what we would consider to be a good decision, even if there is a safe harbor that exists. And so this is kind of bought the marketplace some time to get some of these products.

out there, get a track record, start to see how they perform during up markets, during down markets. And then I think it'll bring us to sort of the third stage, which is, you know, the decision tree. And that's where it sounds like and how I have sort of seen the marketplace evolve is lifetime income is going to take one of three forms. It's either going to be embedded in some sort of professionally managed allocation, ala targeted funds.

or managed accounts, it's going to be offered as a standalone investment option within the core menu, a la TIA traditional, or it's going to be offered as a distribution option, a la Fidelity Income Directs sort of annuity marketplace that they've built out. I think there's pros and cons to each, right? The massive pro to the first option is by embedding this into one of those solutions, you're going to see

Nate Moody (19:30.142)
way higher utilization. Now, is that necessarily a good thing? Depends who you ask. The downside to that is I think not necessarily every participant has the same level of demand for lifetime income. If you're lower income, you're already going to get a ton of lifetime income via social security. You don't need a ton of additional guaranteed income. If you're higher income, obviously those metrics change.

You know, the standalone option, I think, is good in a number of ways, because you can kind of dial up, dial down the amount of guaranteed income based on your personal demand for it. The downside is, obviously, you have a huge educational barrier there, right? You need to actually reach each one of those individual participants and help them understand how it fits into their broader strategy. And, you know, in terms of portability, there's still a lot of challenges with those, because most of those standalone

Josh Itzoe (20:13.698)
Right.

Nate Moody (20:23.906)
options are proprietary to the record keeper.

Josh Itzoe (20:26.134)
record keeper and they would love to get those in there. You know, it's funny, I think that's one thing that isn't talked about in lot of cases is you actually now as a plan sponsor, potentially get really held hostage. You know, let's say you want to move your let's say the service is really bad by the record keeper and you want to move but you know, there's, there's a decent amount of assets that are locked and how do you do that and

Nate Moody (20:28.994)
100%.

Nate Moody (20:56.29)
Well, we've it's funny, it's you know, and this actually might be a good segue to what I would imagine at some point we'll talk about, which is pooled employer plans or PEPs, which is, know, we as an industry have done a fantastic job of educating our clients for the last 20 years that independence is good. You want a separate, you know, the three legged stool, separate record keeper, separate administrator, separate advisor. So that way, if one of their service model or fees are off, we can remove and replace, right?

And this idea of now moving in proprietary investments that might handcuff your ability to fire your record keeper, but maintain the investment option or vice versa, you know, is I think a very similar challenge that PEPs are facing, which is, hey, come join our PEP. But if you don't like our 316 or you don't like a record keeper, you don't like our 338, not only can you not fire them, you have to start a completely new retirement plan to get out of this thing. I mean, talk about handcuffs.

Josh Itzoe (21:47.735)
Right. It's it's Hotel California, man. You check in, but you can't check out really, you know. So and that that that is great. So I actually just, you know, in preparation for this, I think last month, you know, you wrote a like a blog post or an article that, you know, basically talked about, hey, pump the brakes a little bit on one of the the

Nate Moody (21:53.058)
100%. 100%, yeah.

Josh Itzoe (22:16.098)
the pitches of a pep is like, hey, you don't need an audit anymore. We'll take care of that for you. And you kind of like extolled the virtues of what I would say, the audit for kind of small plans and whatnot. obviously peps, and depending upon who you, I've always kind of been a bit of a pep skeptic. They...

you know, really kind of started to come into fashion. It's, know, after I kind of like, you know, transitioned in the kind of like act two. And I always kind of felt like, you know, you get some people that are like, everything's a pep or nothing's a pep. And I was always like, Well, I feel like a pep is more of like, it's a tool in the toolbox. You know, your dad was a, you know, collision repair, right? I would imagine. And I think you said he's he's kind of grown that business now where there's like they have 15 locations, right?

They probably spend a ton of money on tools, but that's because they've got really good mechanics that, you you want to give them as many tools as possible. And there's sometimes where there's a job that's required. They might only use that tool once a week or once a month, but when they need it. Boy, it's a really good tool to be able to have. And actually, Patrick Bush lack from the standard, who's gotten to be a really good friend of mine, really.

I think kind of broadened my aperture from a PEP standpoint. I'm still not in the camp of like everything she I think PEPs are great advisors like wow, I can scale like I can have kind of like one meeting or one fun lineup and my concern with PEPs sometimes is you actually will get

farther away from the plans, the committee, the key decision makers and lose your ability to actually influence, you know, the investment lineup, like that's 5 % of the gig, there's, you know, what you were talking about conversations around, whether it's plan design, or not just like everybody says, we'll benchmark your fees, but really more like, well, what's the philosophy in terms of how we're going to optimize cost structure, whether that be not just what we're going to pay or, but

Josh Itzoe (24:24.174)
you know, what's the structure? How are we going to allocate or really understanding needs of like participants? And so I feel like anything that moves you away from like, those key decision makers where you can really drive leverage, at least from my perspective, I think it's a bad thing. But what have you like where you're from? Where like, you know, a lot of firms now they're creating their peps, they're trying to get everybody in there. Like what's at a firm philosophy and at a personal philosophy with your clients, you know,

Nate Moody (24:39.788)
Yeah.

Josh Itzoe (24:54.286)
Where do you land in that and what camp do you kind of fall in and, you know, how do you approach the idea? I'm sure you get hammered by like, you know, wholesalers around like, you should build a PEP, you should use our PEP. What's the overall firm philosophy that you guys have and your own philosophy as it relates to that?

Nate Moody (25:07.564)
Mm-hmm.

Nate Moody (25:15.938)
So I would say, there's kind of, have, will bifurcate my views in two different areas. One is sort of my views of PEPs within the industry more broadly. And then one would be my view of like independent local advisors going the PEP route. My concerns with PEP within the industry more broadly is, you know, I think actually JD Carlson and sort of Retireholics, they've always done a really good job of highlighting this, which is at the end of the day,

And at least until this changes, advisors have always and likely will always be the distribution channel through which retirement plans are sold. I hate to use that word, but let's just say sold. And as long as that is a universal truth, PEPs will always rely on whoever that advisor that's bolted in to distribute their product. And that creates a completely inherent conflict of interest because

One of the major advantages of the PEP model is the delegation of selecting who your fiduciaries are to the pooled plan provider, the PPP. But how could a PPP provide objective oversight of the 338 if it's the 338 that's distributing that, right? It's like, it's just...

Josh Itzoe (26:34.444)
Right. A cop's never got to themselves a speeding ticket and they certainly aren't going to give a speeding ticket to one of, you know, to the chief of police. Right.

Nate Moody (26:43.584)
That's exactly right. that's one of my major, and then that kind of put me down the rabbit hole of, let's sort of untangle what some of the other quote unquote benefits of a PEP are, one of which that's often referred to as avoiding the audit. And this kind of brought me down one of my nerdier paths ever, which for 401k advisor is saying something. But I think it sort of calls into question like it.

Does the audit serve a purpose? And if so, what's lost by avoiding that? And I do think the audit serves a really important process. And the jury is still so far out with PEPs because they're so new. If these plans are not being administered correctly, what's that going to look like when the Department of Labor or the IRS starts really looking under the hood of these programs? And you might have.

mistakes and errors are going to now go back three, five, seven years that would have otherwise been caught in the same year. And that correction process looks and costs very different when you catch it five years later versus within the same year. And then I think about

Josh Itzoe (27:49.773)
No question. When I think that is, think, I think one of the really important points there, especially, and this is as I get on kind of my soapbox a little bit, I feel like the industry in general has always talked about, you know, it's kind of the, the really good advisors don't do this. They don't fear monger, but there still is a lot of fear mongering about fiduciary liability. But like, and I've said this numerous times on this podcast. mean, I interviewed Jerry Schlifter and he's like, look, litigation isn't like,

$200 million plans is kind of the floor because of a whole range of issues, but mainly like you can bankrupt your law firm by getting into this litigation. the juice has to be worth the squeeze. so fiduciary liability for down market, you know, and especially when you get under, you know, $25 million plans is pretty much non-existent unless there's fraud. What is real is the

Nate Moody (28:22.124)
Mm-hmm.

Josh Itzoe (28:48.878)
and much, much more likely is the risk of operational failure. And those things you talk about if you're an HR director or career limiting maneuver, operate your planning correctly and have a six figure correction that you have to go through. It's a really easy way to like, you know, be out looking for a new job. And I think to kind of your point, one of the things I thought was great about what you highlighted in that article as well is

Nate Moody (28:52.546)
Mm-hmm.

Josh Itzoe (29:16.034)
the industry kind of pitches this magical fiduciary fairy dust and like, operational, you've got a 316 and you can outsource it now. But so much of that is dependent upon how the agreement is written. And I don't know of any 316s that are, I could be wrong, but that are taking on responsibility for, you know, getting, you know, payroll into, you know, funding the plan. And that's where a lot of these things, a lot of operational failures.

Nate Moody (29:21.984)
Exactly.

Nate Moody (29:39.394)
Mm-hmm.

Josh Itzoe (29:44.675)
come into play. And so if you kind of think, this isn't my responsibility, and then, you know, bad data in bad data out, you're gonna get hold the very likely that you are going to hold up your agreement, and they're going to be like, yeah, we like scope that out. This is back on you. Would you? It was that kind of your point?

Nate Moody (29:52.512)
Exactly.

Nate Moody (30:02.294)
Yeah. Yes, exactly. Because that's when you bring up this idea of avoiding the audit, that's always sort of the catch, which is, well, we have a 316, so who cares if there's an error? We'll take care of it. It's like, well, no, you won't. And you have 90 pages of ways in which you're going to avoid actually being held accountable for this correction. And then maybe the last piece, Josh, that I'm skeptical of is, and this is something we talked about earlier, is just sort of the lack of

choice, right? Like once you bolt into one of these peps, if for some reason, one of those service providers is not delivering on their promises, your ability to leave that pep is really, really challenging. And it kind of leads me into one of the reasons why we've really avoided the temptation of going with the pep option, even having that tool in our toolkit.

is we feel like it commodifies the entire retirement plan experience and we don't want to be a commodity and we don't view ourselves as a commodity. And I know for a fact that there are plan sponsors who want their retirement plan to be a commodity and that's completely fine. But if that's the case, we're never going to be the right fit. And if you really want to go the full whole hog commodity, then why would you pick our pet, pick Aon's pick the

biggest pep you can possibly find, because that's probably going to have the lowest fees and you don't care about anything else besides low fees and no work. Beautiful. You will never be a good fit for our pep, even if we started it, because it's never going to be as cheap as right. going to be one pep to rule them all in my perspective. So why chase those short term dollars? If you don't value the work that we do as your advisor in selecting your different service providers in managing your investment lineup and delivering that education.

Josh Itzoe (31:35.33)
Right? Right.

Nate Moody (31:48.214)
then we're probably not a good advisor for you and I'm more than comfortable. I don't want to have plans just for the sake of having plans that we can tack on our little fee and then we forget about them. That's not our model. We're not in it for the fees. We're in it for the impact we can have. We're always going to be able to have more impact when we're working on an individual standalone basis. And if ultimately you're looking for some efficiencies, you can achieve the vast majority of those same efficiencies that are sold by pet providers.

through either like a GOP, like a group of plan solutions, where they still have their own 5,500. But maybe we go 3,38. Maybe we bring in a 3,16. You can still get pretty darn close. And often it's at or even sometimes lower fees, which kind of makes you sort of chuckle. like, how is that even possible? But that's kind of how we've thought about PAPS. Now, I try to keep it.

somewhat open mind. So if things evolve and change, I'm sure it'll something we'll revisit. And we did a full pep RFP. We looked at all the pros and cons and we really just came back to sort of that point of, hey, this is not really in our ethos of putting participants first. And that's always going to be our identity. So it's just not a good fit for us as a firm.

Josh Itzoe (32:58.23)
No, think, and again, that's why I wanted to talk to you in a lot of ways, because I think what I'm impressed by just interacting from afar with you through LinkedIn and whatnot is that you do think deeply about these things. You're not robotic in terms of like, this is like talking points, let me go. You run it through kind of like a filter of like, does this fit for us? And I love what you said about just,

You know, I think advisors a lot of times, you know, feel like they're when they're pitching for business that they're getting interviewed and, you know, and there's certainly that's true. I know for me, and I've talked about this before, was what I think prospects didn't know was like, I was actually interviewing them as well, because I wanted to make sure that they were going to be a good client to work with that that if we weren't a good fit, I think I mentioned this last episode with Grant as well, like,

Nate Moody (33:48.002)
Mm.

Josh Itzoe (33:57.997)
we were gonna make their life miserable, because we were gonna be forcing them to do stuff that they didn't wanna do or they didn't value. And then in turn, it was gonna make our life miserable, because we'd walk out of every meeting wanting to like beat our head against the wall to be like, you know, man, we hate those meetings. Those meetings are not life giving, we can't. And so it sounds like you've taken kind of a similar approach in terms of, you know, the goal isn't to work with.

Nate Moody (34:13.847)
Ha

Josh Itzoe (34:23.86)
every plan that's out there or every company. The goal is really to find those that value what you do. You're not a commodity. You're not a nuisance. And, you know, to really align closely and didn't do whatever you can to kind of like serve their interests and whatnot. What do you look for for you? What do you feel like are the traits or the indicators of an ideal client?

Nate Moody (34:51.36)
Yeah, such a great question. Because we get asked this from wholesalers all the time and even from like COIs, centers of influence. And it's funny because Maine's such a small market, right? Like I would love to say we're only going to do professional services firms. We're only going to do 10 to $50 million plans. But then it's like, crap, there's only three of those or there's five of those. And we already work on half of them. So we operate on a system called

EOS stands for entrepreneurial operating system something we put in place when we went through the first generation of succession planning about 78 years ago Exactly. Yep. Yep. And part of that process is establishing what your marketing strategy in your target market is

Josh Itzoe (35:23.864)
Traction, that's based on the book Traction, right?

Nate Moody (35:33.726)
And we spent a lot of time and we went through all these different iterations of looking at our existing clients, which are the ones we like, which are the ones that are not life-giving, which I like that way to phrase it. And what we came down to are actually all qualitative metrics, which I'm sure somebody who does sales full-time will be watching this episode and say, that is the dumbest thing ever. But it's worked for us, which is it's literally three things is.

We want committees that represent the executive leadership, finance, and administration, because we feel like our best clients are when they have those three stakeholders represented. Second is we're looking for organizations that deeply care about their employees. And then the third is we want clients that value our advice and our relationship. That's our target market. So we want to have the right stakeholders involved in our client committees.

We want committees who truly care about their people. And we want committees that value the work that we do as their advisor. And it's really that simple. And that could be a five-person company. That could be a 5,000-person company. And that's just kind of been our identity. we've been, on wood, really successful with, think, attracting those type of organizations. Because if they don't have those qualities,

We're never going to be a good fit, right? Like we want to be on site doing in-person education. If you don't care about your people, you're never going to make the time for us to do that. You're not going to pull people off job sites. You don't want people to maximize the match. You don't want to pay them the match. You want to say you have a match. You don't actually want to fund it.

Josh Itzoe (37:13.164)
You want to do the least amount possible where, you know, nobody complains. Yeah. Yeah.

Nate Moody (37:16.284)
Exactly, exactly. that's, know, it's a little bit tongue in, or I shouldn't say tongue in cheek, it's a little bit on the nose. We talk about the most qualitative factors, but it truly, truly, truly leads to our best partnerships. And we have clients, you know, now going on 35 years that we've been working and managing the 401k fund, almost as long as 401k has been around. So it's been really, really nice to get intentional on that.

Josh Itzoe (37:43.129)
Well, and you mentioned too, I think, just talking about like, and again, this kind of whole, know, private equity is eating everything, not just our industry, but it feels like every other industry as well. And you had mentioned that one of the things that you learned early on was actually, think, from your dad. I'm sure your dad could have, you know, sold out to the highest bidder, but he actually implemented an ESOP and actually, you know, sold

Nate Moody (37:51.265)
Mm-hmm.

Nate Moody (38:03.657)
Mm-hmm.

Josh Itzoe (38:11.956)
a majority of the company over time to his employees. I think you said he has like 300 employees now and and you know, they own more than he's up on more than 90 % of the equity or whatnot. You had mentioned earlier that long term you'd love for your firm to kind of like that approach and that you actually have a lot of clients that are ESOP owned. And so I would say that, you know, obviously,

Nate Moody (38:18.562)
Mm-hmm.

Nate Moody (38:29.686)
Yeah.

Josh Itzoe (38:41.152)
If you're a company and you've chosen that your succession plan is through an ESOP and not an external sale to the highest bidder, that's probably a good indicator that you're definitely like an employee focused, like you care about your people. Would you agree with that?

Nate Moody (38:57.558)
I would certainly hope so, yes. I think it definitely aligns with whether you're a family-owned business, an employee-owned business, this belief that there's more to business than just profit maximization. And all these different topics are related. And I don't want to point to private equity or point to consolidation as the boogeyman that's responsible for every single issue. But I do think it's a contributing factor to a number of challenges facing our

industry and I think one of which is know succession planning and sort of creating that pathway for next-gen advisors and I don't think it's any secret that we have a talent shortage within our industry and I think partially the reason to blame for that is you know this next generation and I'm 31 years old so I kind of count myself in this millennial gen z era looking at my peers looking at you know folks at some of our clients that I speak with

we care very deeply about the purpose in the impact of the work we do. And it is a fact as an organization grows, it becomes harder and harder to connect your employees with the impact your organization has in whatever that consumer or client base is. And so I think what we've lost as a result of a lot of this consolidation is the ability for

younger people to be out there interacting with their clients, having autonomy over how to design and make recommendations. Nobody wants to be a mouthpiece for a 600 pound gorilla when they're, you know, one of the most exciting and rewarding parts of our job is the ability to actually work within your team and to help formulate recommendations that you believe in to your clients. And when you lose that autonomy, you could be client facing, but you're not client facing.

Right. You're a mouthpiece. You're a conduit for people that are making decisions, you know, five states over in order to make the bottom line work for all of their private equity deals and the multiples they just paid for your firm. And so I know I'm going a little bit on a tangent here, but I just think it's such an important pathway we're on towards this consolidation and roll-up.

Nate Moody (41:14.304)
and we're going to continue to feel the effects of it. And one of the first areas we're going to feel it in is the inability to attract really strong and talented next gen individuals, because they will no longer have the ability to have an impact on their clients lives, like many of the people who really started in this field 30, 40 years ago and built it into what it is today, which has a lot of positive qualities. But they haven't committed to giving that next generation the same opportunity that they had.

Josh Itzoe (41:43.447)
Yeah, the reality is, I think, you know, the word that I would use in some ways is kind of control. You have control to be able to do the things that you think are best for your clients. you know, that's just, you know, it's funny as I talk to a lot of folks and I've talked to a lot of folks where they've sold and it's been great. And I've talked to, you know, not naming any names, but I've talked to a lot of folks that sold that were like, man, I wish I wouldn't have done this because I think, you know, the challenges

Nate Moody (41:53.847)
Yes.

Josh Itzoe (42:13.282)
being very entrepreneurial and then realizing that like when you it's always funny when I talked to certain folks who've sold and now are like, well, I don't have I can't like make the decisions now. And I'm like, well, yeah, because you got a bunch of money. And like, you basically like that was the trade off. Like you just you got to understand like it's not your business anymore. And I think a lot of people especially, you know, the the RIA industry in general, like grew up for a long time and I was

of this where we were kind of this cottage industry, were the kind of these these like practices that you will and and we weren't these enterprises yet. And so I think that's a really good point. think the the the

Nate Moody (42:50.498)
Mm-hmm.

Josh Itzoe (42:59.45)
This isn't a popular take because I think in the world we live in, I actually think there is a, though I've heard a couple of firms, my old one being one of them and then a couple of others recently where I think like they're kind of getting it is actually when independence can actually be a real differentiator.

and actually can be kind of a winning story out in the marketplace when everybody's like, it's a scale and it's size and it's, you know, it's all of that. There's actually a really powerful story you can tell around, you know, locally owned, locally operated, you know, you're talking to the, you know, you as one of the, you know, one of the partners, like you're talking to decision makers, we don't, we're not accountable to kind of like, you know, the corporate mothership.

You know, we can make decisions. What do you see in terms of, and you guys have chosen to remain independent, maybe tell a little bit about that story and why that's important to you. And how do you articulate, know, because I'm sure you may, know Maine may be a smaller market. It's not like you're in, you know, New York or California where there's a ton of firms and whatnot that do what you do. But how do you articulate kind of that

that value prop and you guys have to this point, that's not to say it couldn't change. You're on your second and third gen you and I think you said a colleague that's around your age or kind of the third gen owners of the business. The first gen have kind of rolled out. You've got, you know, kind of a second gen plus the two of you. But how do you articulate like that value proposition of like independence? And what do you think? I mean, is that a

Like, how do you use that to differentiate? That's what everybody struggles with. Everybody says in the industry the same thing. It's when you say the same thing as everybody else, it's really hard for we live in this all the time. Clients don't they have a really hard time. You know, if everybody looks the same and nobody, you know, a lot of times you don't have to be better. You just have to be different. You have to stand apart. How do you use kind of the commitment that your firm historically has embraced kind of this?

Josh Itzoe (45:16.3)
Hey, we are going to be independent. We get called on all the time. We're not selling. We're going to stay in control. How do you use that to differentiate out in the marketplace?

Nate Moody (45:26.018)
Yeah, I would say probably the most important thing is really unpacking what does it mean to be independent and what does it allow you to do because being independent and for the sake of being independent really is meaningless to a client, right? Because you hit the nail on the head like you don't know necessarily the difference between independent private equity back, whatever the case. And so you have to make a commitment to really leaning into the areas that independence allows you to pursue.

that ultimately benefit your client relationship. So really there's two major areas. One is avoiding this huge proliferation of cross-selling, avoid that temptation. And it doesn't happen overnight, right? It's a slow degradation and erosion of those sort of firewalls, right? And it can start off as innocent as you could believe. And it doesn't take long before all of a sudden you're just

pushing every new product line you have on each of your clients. And we've seen it across so many industries that plan sponsors are hypersensitive to it now. And the second is for us, our single greatest differentiator, do we have some smart people? Sure. Do we have as many CFAs or CFPs as a creative planning or a cap trust are going to have? Heck no. Do we, are we nice? Yes, we're super nice. Are we going to be as nice as some of these other firms with their unlimited pocketbooks? Probably not.

Our single biggest differentiator is the service that we provide to our.

And the reason we're able to deliver that service is because we're an independent organization, because we're locally owned, because we're owned by people that work in this business, we're comfortable squeezing our margins at time to deliver on that white glove experience. So maybe that means bringing on extra headcount. Maybe that means bringing on the best and the brightest in terms of really client-focused individuals. So are we successful because we're independent?

Nate Moody (47:28.61)
Not necessarily. We're successful because of what our independence allows us to focus on. But the other piece I'll just maybe touch upon is you have to be intentional, right? Like, you anybody who's followed me on LinkedIn for 30 seconds knows, you know, I'm not shy to really align what we're trying to accomplish within our clients with our external voice and brand. And my aha moment was this was last Christmas.

We had a client, was a client I personally work on. It's a large not-for-profit. Their plan is $700 million. They have 3,000 employees. They're based in Maine. And we had recommended, as part of our role as their fiduciary, they put us out to bid. It's been many years since they put us out to bid. Even though we weren't technically paid out of plan assets, we said, hey, best practice. You really should go out, put us out to RFP. Now, mind you,

This was 2024 in 2023. They won plan sponsor of the year. An award. I'll remind you. I actually nominated them for it. So they won plan sponsor, the highest designation possibly went $700 million plan quarterly meetings. You know, they got legacy assets set at a old insurance record keeper Christmas Eve. I get an email from the CFO says, Nate, we received a quote for $44,000.

which anybody who's involved in retirement plans knows that is so-

Josh Itzoe (48:56.418)
Right, because this sounds like a comp. This is not a simple vanilla like, yeah.

Nate Moody (49:00.93)
And even if it wasn't the amount of liability you take on a $700 million plan, that's no longer theoretical liability. That's real tangible liability, right? That's a target that, know, Schlichter is talking about.

Josh Itzoe (49:08.29)
Right? Yeah.

You live in the neighborhood where, you know, it's a possibility.

Nate Moody (49:14.274)
Exactly. And come to find out it was one of these very, large retirement and benefit insurance shops that were using this as an opportunity to buy the retirement plan because they knew it would give them the opportunity to try to cross sell employee benefits, property and casualty insurance. And the challenge we've kind of come across as an industry is we have

educated our clients to think about one thing and one thing only, is fees and lower fees is good. Higher fees is bad when we should be focusing on value. And what are you getting for those fees? And that has been a lesson I've tried to really take to heart over the last 12 months is educating our clients that nothing in this world is free. And when you're getting these outside bids from these consolidated firms, they're looking

at you as the product and they're going to try to unload all of their other services. And then on the other side too is just reinforcing our commitment to service. And over the last three years, we've had a 99.6 % retention rate, which for an organization that over that same time period has added a hundred new retirement plans, which is like, think 150 % growth in number of plans to maintain a 99.6 % retention rate. That's maybe the last point, getting long winded here.

is you can't just talk about it. You've got to be about it because your clients will see right through that. So it's one thing to post on LinkedIn and critique the consolidators, but you really have to be committed internally to what you're trying to sell. We did keep it. Yes. Yeah. And we did increase our fee as part of that. We had to reduce what we were increasing it by, but it was a flat fee. obviously, plan assets have grown substantially as a result of our liability, as have our costs.

Josh Itzoe (50:48.462)
So did you keep that plan?

There you go. There you go.

Nate Moody (51:05.14)
But yes, we were able to retain the business, which is great.

Josh Itzoe (51:08.248)
When I think that is, and...

That's one of the biggest challenges that are out there. there's the quantitative, like here's what our fee is. I run a handful, maybe five, six, seven advisor RFPs every year. I don't work with planned sponsors anymore, but I do. And some of the big firms refer me in.

I run a pretty good advisor RFP and nobody wants to run the advisor RFP because they all want to kind of like bid on the actual business. And it is an interesting, especially, and the plans I do this for are all generally, know, 150, 200 million dollars and above. And so the larger market and it's been crazy, the fee compression that's kind of come down. you know, everybody looks kind of the same and says the same things. And I think that's

Nate Moody (51:42.668)
win the business here.

Josh Itzoe (52:06.646)
You know, a plant sponsor doesn't know if they have a really good advisor until it's not like you go buy a car and you can take it for a test drive. You know, you can see what the acceleration looks like and feel what the leather seats look like and and whatnot. Like you actually have to like live it to kind of experience it. And. You know, one of the things I we used to get that we serve, we used to survey our clients a lot and.

heard it from other people that, you one of the most important things I think for plan sponsors is just responsiveness. Like, we used to think like, I you know, I was like, hopefully, because they think we're the smartest, or we've got the best takes or all of this. And most of the time, it was like, you guys are super responsive to us. We know that if we have an issue, we call you like, you're going to respond, you're going to respond quickly, you're going to take care of it. And so, you know, in one way, it was like, that's great. And another way, I was like, my ego kind of took a little bit of hit. It's like, it's it's not because we're, know,

how smart we are. But interestingly enough, I think when a lot of these bids go out there, a lot of times advisors will bid because they don't really know what the complexity, and that's dangerous, right? If you get in and it's like, this is a way more complex scenario than I thought it was, and we kind of really lowballed ourself. But I think the other thing is that that doesn't take into account what's actually being done.

kudos to you for kind of like keeping that plan. I actually used to say like sometimes, and because you find this, right, you work with a plan, usually, it's like anything the first few years, it's a ton of work, because you're like fixing stuff, or you're unwinding things, or you're putting new things in place. And then once you kind of get them to, it's like any relationship, they kind of start to think, well, this must be what everybody's like. And I always used to say like, you know, I live in Maryland and, you know,

My dad grew up in Amish country and you know, the Amish have like I forget what they call it but like when you're 18 like you leave for rumsbringer you leave for a year and most of those folks they go out and so their wild oats and then they wind up coming back and sometimes I was like, you know, I wish kind of clients would like go away for a year just to see like what the vast majority is like because I really think they would kind of come back and

Nate Moody (54:10.4)
Rum Springer. Yeah.

Josh Itzoe (54:31.224)
The fact that your client had kind of experienced over time what you had done, the services, I love what you said about, we don't have to always be focused on the bottom line. Sometimes you have to do things that don't scale, which isn't a popular take right now, but sometimes you have to do those things that don't scale. That's not a bad thing. You may have a year where you do a bunch of work for a client that it's gonna be less profitable, but it strengthens that bond.

Nate Moody (54:46.37)
Yeah, it's so true.

Josh Itzoe (55:00.342)
that you have with them. And so I think the key takeaway here, whether you're, and this is, you know, obviously with what I do now with kind of Perceptive and, you know, our platform is really around helping advisors show clients like, you see all the things above the waterline that we do, but let us show you the things below that you don't really, that you don't really, you have to remind clients because they forget of everything you've done for them. You have to,

really paint that picture in a really, really clear, in a really clear way. And what you said before I loved was like, you actually have to live it, you have to do it. It's easy to say the right things. And in a finals presentation, everybody says the right things. It's a lot harder to do the right things consistently over time. But if you do that, I do think, you know, for those clients that are aligned with you, like, they're going to reward you with loyalty.

Nate Moody (55:40.982)
You

Nate Moody (55:55.042)
Mm-hmm.

Josh Itzoe (55:55.659)
It's tough. mean, I'm sure I would imagine the only time you ever lose a client. I'd say you'll never I lost a client or two over time from a service standpoint, and we dropped the ball and we got what we deserve. But for the most part, the only time we lost clients was &A, they got bought. And, you know, we were the bridesmaid and no longer the bride. But I do think that everybody talks about service. But it's one thing to talk about it. It's another thing to actually do it. And it sounds like that's some of the things I've read that you've said is like,

You haven't been focused on like a ton of like outbound business development, hardcore sales hunting, that you guys have just really leaned into serving clients really, really well. And what's happened is, you know, they've referred you people or you've had, you know, a committee member who's left to go to another company. And I think what you said is like, they realized they couldn't live without us.

Nate Moody (56:51.682)
That's the model we're trying to build. Yeah.

Josh Itzoe (56:52.415)
which is a little tongue in cheek, but I think you're probably right, because they got in and they were like, this isn't anything like what we had before.

Nate Moody (56:59.798)
Yeah, no, that's exactly right. And we don't have a single salesperson at our organization. We don't have a single person who's solely focused on sales. Our entire business development team is just made up of our advisors, our retirement counselors, our wealth advisors and whatnot. And so it just creates a much different dynamic where when you have service and sales as separate functions, you always run into this conflict of sales over promising and service never

being able to deliver on it because you just create unrealistic expectations. I also think when you are in the trenches as an advisor, as a relationship manager, it helps you better understand what those types of prospective clients are really looking for. And so much of the focus in our industry and something we talk about all the time with particularly some of newer advisors is our plan sponsors don't wake up dying to meet their fiduciary duty.

Like that's not their mission in life. And even if they care about their retirement plan, which many of them do, what they care about is not fulfilling their fiduciary responsibility. It's creating a competitive benefit for their organization. It's educating their coworkers on the importance of saving for retirement and making it as easy as possible. So we focus so much of our time and attention on those. Now, obviously you have to meet your fiduciary duty in order to do those other.

things and so you we go through the QDIA reviews, we do the fee benchmark, we do the RFP, but that's not our you know North Star when we're working with our clients. It's how do we make this plan as competitive as possible? How do we make running it as easy on our HR partners as possible so they can focus on what they do best? And then finally how do we help their co-workers get the most amount of value out of this tremendous benefit?

So that's really what our focus has always been it just creates this tremendous flywheel that when you're not spending your time as an advisor out there You know trying to call up business and say you're focused on you know improving your clients lives They will be your biggest advocates and I again I know that's like feels like a trope, but it truly is it is the case

Josh Itzoe (59:11.404)
Yeah. Well, I think the genius of what you said and which is so true and.

You know, fulfilling your fiduciary duty, isn't shouldn't be the primary driver, should be the secondary benefit. And I think this goes back to kind of like when you think about one of you, one of the three pillars of like a core client is like, we want the right level of executive sponsorship, cross functionally. And then like, I think one of the most important things an advisor can do is

to make, like you, it is contagious. Like if you care about this in a deep way, you can make those committee members care. And once you get them to connect, you know, one of the things I used to, you know, I used to do with clients or prospects is, you know, to try to dumb things down a little bit and say, look, we wanna make this retirement benefit program solution.

So simple and simple doesn't mean unsophisticated. Actually, there's huge sophistication and simplicity. But so that basically none of your coworkers can throw a gutter ball with their retirement. And I would always say, you know, I think we talk about, I'm a data guy, but I would say, look, I want each of you on the committee to in your mind, think about the least sophisticated person financially at your company.

Nate Moody (01:00:23.264)
Yeah, well said.

Josh Itzoe (01:00:47.438)
Do you have that person in mind? And I'd give them a minute and they would say yes. And I'd say, I wanted you to think about their name and our job as a group, you as the committee and us as your fiduciary advisor is to be committed to making the wisest decisions possible. So we put that person in the best possible place to consider or succeed. And you know, it was interesting when you can start to get those committees to really care about

like their people and doing the right thing. And obviously not every company, some companies, they just don't care. But I would argue they're not a good client for you. But once they start to care and once they start to not think about, you know, their their people as like participant counts on a report, what actual like friends, colleagues, coworkers that they have a real responsibility to serve.

Nate Moody (01:01:22.294)
Yeah.

Josh Itzoe (01:01:43.907)
then they start to do all the things you want them to do. And when they do all the things that you want them and prod them to do, they're gonna fulfill their fiduciary responsibility. It's just the natural byproduct. So it shouldn't be the goal in my opinion, it should be the byproduct that comes from doing the right things. And it sounds like you guys have really dialed in, you've really dialed in to that. As we wrap up, it's funny, you're unique, not unique, unique means there's nobody like you.

Nate Moody (01:01:47.244)
So.

Nate Moody (01:01:53.186)
Mm-hmm.

Josh Itzoe (01:02:13.198)
I would say you're uncommon in the sense that you have a lot of like an extensive amount of experience, but at a really young age at 31. And so you've got probably the hands-on expertise and experience of somebody who has been in the industry for a long time. Like you're kind of that next gen and you've advanced.

a lot faster than probably a lot of your peer group in this industry, which is a function of probably the work you've done, but also the opportunity you got your dad gave you really good advice way back when good you listen to them. I have college age kids now and sometimes getting them to listen is a little challenging. But what what do you like? What would be the top three things you would say to kind of your peer group of next gen professionals that are really looking to, you know,

Nate Moody (01:02:49.442)
You

Ha

Josh Itzoe (01:03:07.918)
get into like a similar position. Like what would be a few points of advice that you would give to them in terms of how they develop? You know, I think professional development is a partnership, both between like who you report to, your leaders, but also yourself. The firm can't do it all for you and you can't do it all by yourself.

You found it sounds like an awesome place where that partnership worked really well. What would be your advice to your peers of next gen advisors to, you know, to put themselves in a similar position that you've attended to?

Nate Moody (01:03:51.264)
Yeah, the first one will be super cheesy, but I do think is an important first question to ask yourself because it's not going to be the same answer for everybody, but really having a hard conversation around what success looks like and means to you. And again, it's cheesy, but it's true because there are people out there whose success is I want to earn as much as possible.

And that isn't necessarily always a bad thing. Maybe it's because, you you didn't have anything growing up and you have a family to provide for and you need to make sure you can provide a better life for them. Like these things are all decisions that have completely rational explanations for why you arrive at them. But you have to be true to what that is, because otherwise, particularly in our industry, if you really don't believe in what you're doing, you're never going to get paid enough and you're always going to be worked too hard because just the nature of our business.

Josh Itzoe (01:04:44.162)
Right? Right.

Nate Moody (01:04:44.946)
So number one is really having that man in the mirror, woman in the mirror of like, what does success look like to me? And if it ends up being like, hey, I want to have a really significant impact and I want to do it in a way that is very tangible to me. So in my example, I completely get out of bed to help other Maine people on this retirement and financial journey.

And so for me, you can't do that at a firm in New York City. You can't do that at a firm in California. You have to be here. That's where the clients are. That's where the people are. So for me, defining success helped lead me to, if I wanted, get as much exposure and learn as much as possible, you're always going to be able to do that at a smaller company than at a larger company. So as much as the short-term dollars are going to be lower, you know, I joke, when I started,

here 10 years ago as an analyst, I think my starting pay was $43,000, which is a big amount of money for a lot of people coming out of Bowdoin, where a lot of my friends were going investment banking down in New York City. They laughed. like, Nate, what are you? Is it a nonprofit? 100%, exactly. But I had my dad's words ring in the back of my head of A, what does success look like? It's not necessarily defined by the amount of money I'm bringing home.

Josh Itzoe (01:05:51.778)
Right, right, right, right. That's what they paid for their apartment. Yeah.

Nate Moody (01:06:07.358)
And B, where do I want to be in five years and 10 years? Am I going to be better off earning more? But I'm to be still working that same sort of cog in the machine job in five or 10 years versus here. I'm going be able to do a little bit of everything and I'm going to play the long game. So that would maybe be my next piece of advice. And the last piece is probably by far where I've learned the most is, and I know it's, again, I chuckle because it's such a millennial or Gen Z thing for us to actually think about is like, go out and talk to people.

Like reach out to people who have been there, done that, hear their stories. And you're not always going to agree with the path that they took on or why they did the things that they did. But the more you can learn, not just, you know, within our industry, but even just from your clients, take the time to like, let's go grab a coffee or a beer. Tell me more about your business. What went well? What didn't go well? Not only are you going to ingratiate yourself with your clients or your COIs or whoever else.

But all of that experience is so meaningful and particularly with these younger generations. And again, I put myself in there. A lot of us didn't have some of the like, you know, out there grinding at 14. Right. And so we need to kind of play catch up in terms of some of those life experiences that create empathy and create a level of relatability, especially recognizing that this is changing. But currently, a lot of our clients are 20, 30 years our senior.

and they want to work with people who understand themselves and understand their people. And there's no shortcuts to that. That's changing. We're seeing those decision makers turn over. But that would be my last piece. So the first one is ask yourself what does success mean to you? Second is align your work environment around sort of achieving what that success looks like. And the third is don't be shy. Go out and ask questions. Be self-effacing and solicit that input from others.

Josh Itzoe (01:07:59.395)
I think that I think that's great advice. I think maybe part and parcel like the the second one you said was this idea of the long game. I think is important is like finding a place where you're going to get like game time reps. I played college and professional baseball. My son plays D1 golf. My daughter plays D was going to play D1 soccer next year and I've always said to them like. Practice is important, but there's nothing like game time reps. You are going to learn so much.

game time reps. So a lot of times, you know, finding a place where you actually can be sitting in those meetings where you can like that work you did as an analyst to really kind of like, master your craft really played has, I would imagine played paid dividends for you. When you're sitting in front of a client, it's not like theory you like actually, you understand that. But I think you know, you've obviously accomplished a lot in a relatively short period of time. Kudos to you for that.

you know, with what your firm you guys are growing and having great success and, you know, making an impact. And I think that that first one you said of like, what is defining what success looks like is so important. And, you know, what may look like success, I think I found this as I get older is like the things that I thought when I was younger around what success looked like as I get older. I'm like, those aren't the things that necessarily matter. But that's very much an individual.

Nate Moody (01:09:24.866)
Yeah.

Josh Itzoe (01:09:28.27)
kind of decision. So, Nate, this has been an awesome conversation. I've loved your insights. I love the way you think about things. And I just really appreciate you coming on and wrapping today. And I think we touched on a lot of good, a lot of good topics. What's the best way for if people want to kind of get in touch with you? What's the best way to do that?

Nate Moody (01:09:48.736)
Yeah, would say connect with me on LinkedIn. I'm fairly active there, I won't take... So yeah, Nate Booty on LinkedIn or you Google Nate Booty, probably 401k or main. I'm sure I'd probably pop up. would imagine at this point I've posted enough out there into the ether, so I'm sure it'll show up.

Josh Itzoe (01:09:52.974)
Fairly, fairly active. Yeah, I'd say so. I'd say so.

Josh Itzoe (01:10:10.314)
Awesome. Thanks so much for the conversation and hope listeners have enjoyed it.

Nate Moody (01:10:17.474)
Thanks, Josh.