Peter Lazaroff, Chief Investment Officer at PlanCorp and author of "Making Money Simple", joins to discuss the complexities of adding private equity to retirement portfolios. They explore essential factors like having a solid financial plan and clear retirement goals. Peter explains what private equity is and highlights its potential risks and costs. The conversation emphasizes the need for careful evaluation, cautioning against following trendy investments that may not suit individual strategies. Tune in for a clearer understanding of these investment dynamics!
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volunteer_activism ADVICE
Problem-First Investing
Start with the problem you're trying to solve with your advisor.
Don't lead with a solution (like private equity) and then rationalize the problem it solves.
volunteer_activism ADVICE
Simplicity Over Complexity
Keep retirement planning simple and focus on your life vision first.
Secure a feasible and resilient retirement plan before considering complex investments like private equity.
volunteer_activism ADVICE
Scenario Planning
Evaluate private equity investments by considering best-case and worst-case scenarios' impact on your life.
If the worst-case scenario doesn't significantly impact your life, consider if you're investing for intellectual curiosity or potential gains.
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In this book, Tony Robbins and Christopher Zook interview over a dozen of the world’s most successful alternative investment managers, collectively managing over half a trillion dollars. The book covers various investment strategies, including private equity, private credit, private real estate, and venture capital. It also discusses how to invest in the energy evolution, own pieces of major professional sports teams, and use private real estate as an inflationary hedge. The authors emphasize the importance of a problem-centric mindset and address psychological barriers to successful investing.
Making Money Simple
Peter Lazaroff
In this episode, we tackle the complexities surrounding private equity in retirement portfolios. Join Roger as he navigates a listener's inquiry about the necessity and implications of investing in private equity, especially in light of recent discussions and literature on the topic. With insights from investment expert Peter Lazaroff, we explore the pros and cons, the importance of having a solid retirement plan, and whether private equity is truly a beneficial addition to your portfolio. Tune in to gain clarity and confidence in your retirement investment strategy!
OUTLINE OF THIS EPISODE OF THE RETIREMENT ANSWER MAN
(00:00) Complexity is your enemy. Any fool can make something complicated. It is hard to keep things simple.-Richard Branson
(00:38) Today’s episode is about private equity.
(01:33) Roger reads an email from listener Dave with a question about investing in private equity.
(02:28) Roger says that this episode features his opinion and judgment on private equity.
(06:45) Don't think about private equity until you have a vision for what you want your retirement to look like.
(10:20) Consider the second order consequence of making an investment.
(12:00) Unless you are significantly overfunded and have an interest in private equity- Roger thinks private equity is unnecessary for creating a great life.
INTERVIEW WITH PETER LAZAROFF
(14:10) Introduction of Peter Lazaroff, author of Making Money Simple
(16:39) What is private equity?
(17:38) Who is traditionally invested in private equity?
(26:12) When markets are under stress, private equity correlations go a lot higher.
(27:49) What is the normal fee structure for investing in private equity?
(31:15) What you're seeing more often these days are semi-liquid funds that offer liquidity windows.
(34:30) There is no evidence to suggest that fewer companies going public is causing an issue.
(40:15) We can’t predict when a bad decade of returns is going to come.
(41:35) Peter: I am more concerned about implementing a bad idea than missing out on a good one.
SMART SPRINT
(42:39) In the next seven days, take a moment and remind yourself of the purpose of retirement planning which is to create a great life.
BONUS
(43:20) Roger reads an excerpt from his grandfather's WWII journal.
Retirement Answer Man 
