The Future of UMH with Scott Smith

Jack Sharry: Hello everyone. Thank you for joining us for this edition of WealthTech On Deck. As the friends of our podcast know, we spend a lot of time examining what’s in store for our industry and for the future of financial advice, especially as it plays out around the confluence of digital and human advice. I recently came across some really associates research on unified managed household, UUMH, that caught my eye. The research found most advisory firms say they’re working on building a UMH, so I called Scott Smith who led the study to learn more. Scott helps Cerulli clients understand how to optimize their platforms given the evolving demand for financial advice. He also serves as a member of the CFP board’s digital advice working group. So clearly he is paying attention to what’s going on around digital and human advice and where we might be headed, of course, really has been delivering financial intelligence to the financial services industry for more than 30 years. They are asset managers, wealth managers, private equity and financial technology firms with data research and advice. They not only look at what’s happening today, they keep a keen eye on out for what’s coming next. So I invited Scott to join us for this session of WealthTech On Deck. Scott leads really research efforts focused on investor behavior and advisory relationships, especially as it plays out around platforms. Scott, welcome to WealthTech on Deck. Good to have you here.

Scott Smith: Thrilled to be here, Jack. Thanks.

Jack Sharry: Yeah, well have some fun. So Scott, as a, I know you are a WealthTech on Deck listener, you know, we talk a lot about. Multi account platforms and unified managed households or UMH And the most recent conversations you and I had started after I came across that really research I was just mentioning to indicate a lot of people are trying to figure out just this UMH thing, what is it, how does it work? And so on. So fill us in, what are you finding regarding, UMH, and where are we headed? Alright,

Scott Smith: Alright, so when it comes to UMH, I guess the, the first thing we start with like, is. Everyone is interested, but what happens is they get intimidated quickly when they figure out the complexity of what goes into it. From our perspective, right? At the platform level, really everyone understands the basic account basics of like single account tax loss harvesting. But even now with advisor adoption isn’t there on even single account tax loss harvesting, and when they are using it, many times it’s manual instead of process oriented. So. Those are the basic steps of advisor adoption is always the key, right, of getting this thing used as advisor adoption.

Jack Sharry: So step back to the platform level. Once they get by that single account tax loss harvesting and they start thinking about UMH, I think basically tax optimization basically becomes like the hydro of Greek mythology to them, right? They think they have one thing under control, they chop off a head. Two more heads pop up and they something else they can’t figure out.

Scott Smith: So. Everybody was like, yeah, we gotta do that eventually. But like what’s our first step? What’s our next step? How do we get there from here? Yep. I think everyone loses the needs to pull out a map and they don’t know where to start or where they’re going.

Jack Sharry: Gotcha. So I actually just occurred to me as you were saying this, that I don’t think I shared this with you as we’ve talked in the past many years ago, well before I was involved with LifeYield, I had this crazy idea, what if you could manage all the accounts in a household, in a, some kind of coordinated way.

Scott Smith: Mm-hmm. And then I sort of worked with my. Team at the time I was involved in the annuity business because we were trying to figure out how do we include annuities as part of an offering platform type offering. And this was, shoot, 20 years ago probably. I did some homework and quickly figured it out. I, there’s no way that I would know, have any idea.

Jack Sharry: And I think that’s pretty much where the industry has been. I think the first whitepaper was written by Lockwood. Len Reinhardt wrote it back. It’s like 25 years ago.

Scott Smith: Mm-hmm. So there’s been a lot of talk about it and a lot of it, I think in terms of why it hasn’t moved forward until recently. It seems like people are moving.

Jack Sharry: I’d like to hear more from you on that. What has changed? What is changing? How are people moving forward? There’s been a lot of talk about it. I fear, frankly. There’s still more talk than action, but fill me in. You, you’re talking to everybody every day about this kind of stuff, so what, what do you see?

Scott Smith: Yeah. What I see is really kind of people like picking off one thing to do at a time, right? Like we talked about this tax loss harvesting. Some people are looking at tax efficient transitions, right? I think that’s something that’s very popular industry now. Something like 55IPs.

Jack Sharry: Sure. You know, taking a portfolio that was somewhere else has the holdings.

Scott Smith: Mm-hmm. We want to get it into the new portfolio and how do we get it there? Is there some kind of a. Annual budget on taxes or how can we minimize that? So I think that’s a good example of like plucking things off. But, and then there’s some, some folks looking at kind of smart withdrawals or integrating against social security to optimize those withdrawals, make sure they’re not taxed the tax as little as possible. So I think they’re plucking off these pieces. But the way I see it, there’s like. Eight separate things that go into like a basic UMH framework.

Jack Sharry: You mentioned that the other day we were chatting. Sure. You mentioned you had a list of what you think comprise is makes our defines A UMH. Why don’t you share that for our audience? Because I think you, when you shared with me the other day, I think you’ve captured it.

Scott Smith: Yeah. And certainly this is subject for debate and you know, feedback, but I think step one is just integrating with a financial plan, right? We have to figure out what our actual goal is with these accounts and how are we gonna get there, what the timeframes are.

Jack Sharry: So. Starting off, just get it integrated with the financial plan.

Scott Smith: Mm-hmm. Then we talk about like those tax efficient transitions. If it’s new to the, a new advisor to the client, what’s that portfolio gonna look like once they’re integrated into the new platform and then we get into this asset location optimization.

Jack Sharry: You know, we can use taxable accounts, we can use IRA accounts and where, what’s the asset allocation between those two? Then we get into the basics of, you know, tax loss harvesting, and then. I think the step beyond that is this multi account rebalancing, and I think that’s one of the, the core, you know, the real core elements of the, um, umh is using the accounts together to get a better ultimate outcome.

Scott Smith: Mm-hmm. And I think we start getting into the, the retirement aspects of it, that social security, lifetime maximization, tax smart withdrawals, and really creating that retirement income paycheck. It’s like all those things together. Or what firms are gonna, I think that’s the future state all the firms want to be, and it’s to kind of have all these eight things working together.

Jack Sharry: But like I said, right now, it’s kinda like tax loss, harvesting asset location is sometimes like done by an advisor, by their gut. Sure. Or kind of has like, there’s not a, a firm wide process for doing that. Well, yep. Social security, maybe a firm has like a standalone tool to do that. Or an advisor’s like, you know, working for some rules of thumb, which may or may not be.

Scott Smith: Optimal long term. It’s like all these things, you know, there’s so many things for advisors to consider and we’ve kind of put that on their plate for so long and not given those resources at the firm level. And I think it’s kinda the obligation of a firm to make sure that those all these things are in place still have to have advisors. Adopt them, but at least making sure it’s available to them in a way that they can reasonably use it with their clients is so important to me.

Jack Sharry: So for our audience that may know some of what you’re talking about, maybe talk about the process that got us here. So you recently came out with a study, if you would talk about that just a little bit.

Scott Smith: Sort of frame that up as to what you were studying. Yep. Then you found some percentages around people that are. Doing it that are quite serious about it. Talk a little bit about that, if you would, and then just talk about your process about how you talk to firms. You talked to a lot of firms, talk to Sure.

Jack Sharry: A lot of people that are responsible for product and platform. So maybe just talk about that whole thing just to give people a sense of what you, how you go about what, ’cause you, you got your, clearly got your ear to the ground and then, then you talk some more about what people are saying about all that. How are they doing? Sure. With all that.

Scott Smith: So this really research process is kind of a two-tiered process, right? We, we have industry conversation with all of our clients, everybody who’s operating in the industry, like we have clients who are asset managers, wealth managers, technology providers, other consultants.

Jack Sharry: So first thing we do is wanna talk to everybody and kind of get their initial feedback on the. Subjects we’re exploring and kind of the next step there is we go out and we, we survey these people, uh, on an annual basis. You know, on a quarterly basis we’re collecting asset figures from all the various programs, but on an annual basis, we’ll go out with more of a thematic survey and say like, here are the top things we’re thinking about.

Scott Smith: What do you think about? You know, tax optimization, are you using asset location, like all the component parts of this? What do you have right now? What’s next on the horizon for you? And if you could snap your fingers and make one thing happen, what would it be? Gotcha. So last time we went out to the field with that, we did a little bit of a focus on some of the, some of the, the tax overlays that are available in the industry.

Jack Sharry: If you would, uh, Scott, explain when you say tax overly, what are you referring to?

Scott Smith: Sure. So kind of those, of those eight things we talked about, kind of tax efficient transitions, asset location. Gotcha. Tax plus harvesting are kind of like the, the core three that we think people are, get their arms around now.

Jack Sharry: So what we’ve seen is some progress, right? We went from kind of a low levels of automation and high levels of manual work by advisors, where it shifted a little bit where there’s more firms that are reporting, they’re automated on tax loss harvesting and asset location. But there’s still, the bigger numbers are still advisors doing these things.

Scott Smith: Advisors doing tax, less harvesting, advisors doing asset location. Mm-hmm. Mm-hmm. Which maybe they have a spreadsheet, maybe they know what they’re doing. But these outcomes are gonna differ across clients in one. All the client’s outcomes to be good.

Jack Sharry: As you know, Scott, a lot of ’em have a thumb. Yeah. So they, it’s a matter of just holding up the thumb to determine how they do that.

Scott Smith: You’re absolutely right. And you know, we’ve, we’ve been through this on the home office model portfolios versus advisor portfolios. This is a kind of a, a recurring theme is that advisors are used to it, doing it one way. They think they’re doing a pretty good job, and they might be doing a pretty good job, but are they doing the best job?

Jack Sharry: And to make these things process oriented from the firm, it really is. It’s the responsible thing to do. It’s better for the advisors. It gives them more time to spend with clients, more time prospecting, doing discovery, building those bonds. And the client’s probably gonna end up with more money at the end of the day.

Scott Smith: So I think that’s an obligation we all need to embrace at this point.

Jack Sharry: Sure. And just wanna underscore that obviously all this is leading to more money for the client, which also translates into more money for the advisor and firm if they retain more, pay less in tax, if they compound more. It grows more rapidly.

Scott Smith: All you know, all the stuff we all know, but just to affirm what is maybe obvious, but sometimes gets so lost in the detail of what we’re doing. We forget what the reason we’re doing it. Right. So, Scott, talk a little bit about the numbers. I know my recollection is that something like 53% are working at it, 37% or something like that are serious about it.

Jack Sharry: So Phil said on what you found in terms of the survey and what. What that means.

Scott Smith: Sure. So, um, starting with the kind of the automated tax loss harvesting, right? We compared numbers from 2022 to what we found in 2024 when we’re kind of surveying the same people. So back in 2024, we had 19% of people, 19% of firms supporting that they’re doing.

Jack Sharry: Automated tax overlay on tax loss harvesting on a regular basis. So 19% of firms, yeah, that’s 2022. 2022 is 19%. 2024. Yep. That had jumped to 28%. So solid increase there, 50% increase on the ad hoc tax management, you know, went from 33% up to 45%. So that’s. Again, an increase is good that they’re thinking about it, but having it done ad hoc by advisors probably suboptimal.

Scott Smith: So we have both the ongoing automated increase and the ad hoc increasing, but you know, we need that ad hoc to ultimately be automated and ongoing and not something that advisor thinks to do on December 15th every year. Mm-hmm. Same thing played through on the asset location side back in 2022, 12% of respondents said that they were, had that an automated basis that jumped up to 19% and the kind of the ad hoc. For advisors that pretty much stayed steady at 38, 39% in both years. So, you know, I think advisors aren’t, they don’t quite understand asset location as well as they do tax loss harvesting, so they’re less willing to do that on an ad hoc basis. Yep. Probably it’s a better bet too. Um, as you know, you can understand when there’s a loss, you can take it and it, and it’s something that an advisor can understand and convey to a client where asset location gets really complex and kind of dividing portfolios and running separate asset allocations is just a little bit a step too far for many of them.

Jack Sharry: Chris, A, a big thing that you understand and I fear frankly, most, many don’t, is that when you do it, first of all, the part people are, seem, everyone pretty much understands this tax loss, harvesting. It’s a single account exercise. It’s been done for a very long time. Advisors, it’s kind of a, you know, stock and it’s just what they do.

Scott Smith: You know, they, they do that. Yep. But we moved to asset location, which by the way, all the research, whether it was. You know, a whole bunch of studies have been done, but the four we always look at are ey, Vanguard, Morningstar, and, uh, invest That each did a study. They all say roughly the same thing, a little differently said, but mm-hmm.

Jack Sharry: Pretty much the numbers are pretty close, but when you get the biggest impact is asset location. If you put the right stuff in the right place. In other words, tax inefficient assets in the IRA and tax efficient assets. And I’m not telling you anything. No, but just to make sure our audience is with us, you know, all this, but put the tax efficient assets in the taxable account so that that’s asset location, which necessarily means ’cause you’re also observing and trying to maintain the asset allocation, the risk parameters.

Scott Smith: Well, it’s necessarily a multi account exercise, and boy, that’s where it gets complicated. You know, you can’t do that with a thumbnail or, you know, back of an envelope or a yellow pad.

Jack Sharry: So we weigh in on that. ’cause I’m sure you’re, I’m sure that’s what people are finding as they’re, they’re looking at this whole thing.

Scott Smith: Yeah. We, you know, when we ask and we speak with advisors, they really think of it as a single account allocation at a time. And they’re trying to keep the asset allocation consistent in each of their portfolios. And just the, you know, the basics of that asset location is, you know, you’re gonna want to help.

Jack Sharry: We wanna hold long-term held equities generally in the taxable account as much as you can because you’re able to take advantage of cap gain taxes, where at the same time, you know, fixed income in an IRA or anything like that is gonna be better off for you because you know there’s dividends coming in year after year.

Scott Smith: You’d rather keep those shielded from taxes as long as you can, but that’s just not, mm-hmm. It’s just not an idea that is. Obvious to advisors to get them to be able to do it by themselves, nor does it come up with clients all that all the time. Right? They, they look at their portfolio, they think of it as one thing, and it’s not easier for them, easy for them to kind of understand the householding, where the overall asset allocation is this, despite the fact that, you know, you might have all equities in one and all.

Jack Sharry: Uh, fixed income in the other, but just combining those gets you to that allocation in a more efficient way. The upside of that is that, you know, there is an incentive for the, the client to consolidate those assets at one provider so you can implement that. And I think that’s one of those things is that getting clients to understand the path of least resistance, their optimal outcome, and getting all those assets under one roof.

Scott Smith: You know, we, you know, we’ve been talking about wallet share and asset consolidation for 20 years, but I think it’s becoming. People are just getting overwhelmed by the number of, they have the number of passwords they have. Anything we can do to make a client’s life easier, bring those things all together, not have them have to worry about it.

Jack Sharry: It’s a compelling story and it, you know, it allows the advisor. To create, deliver more value by being able to overall those, oversee all those things at the same time and getting to work together for our audience. Scott was kind enough along with his colleague to come visit our offices, to interview us, as he does with so many different kinds of firms around what we do.

Scott Smith: And so we had a, a very healthy dialogue around all that sort of stuff. Shared some things. One, one of the things that I can just say for. We don’t see too many that actually do asset location. They, there’s a lot of folks that would like to, the level of complexity is, uh, Scott, I’m sure you’ll affirm is, is really pretty onerous.

Jack Sharry: But the net effect is for those wondering, so why are people doing this? Why does it matter all. Frankly, because it causes consolidation, it causes retention, it causes asset growth for the firm. So I’ll give you all, this is public domain stuff. Our client, Morgan Stanley, is the fastest growing firm for net new assets in the industry as a percentage of where they started.

Scott Smith: They’re larger than Vanguard, fidelity, and Schwab. And now they start, start with a smaller base. So is a percentage. They’re the fastest growing and everything’s around. As a location, how do we put that together? How do we look at all the accounts in a, in a more holistic way and how do we show the benefit to the client where they wanna consolidate?

Jack Sharry: Frankly, as you well know, I’m sure from your research that people when they start getting into their fifties, would just soon for, if nothing else, for administrative reasons, want to consolidate, just ’cause it’s easier to manage.

Scott Smith: So mm-hmm.

Jack Sharry: Weigh in on that is what you’re seeing is, I know a lot of folks are grappling with the whole concept of asset location in a little bit.

Scott Smith: We’ll talk about income, which is a whole other subject, but it also challenging. So, but first let’s talk about location. So I think one of the confounding factors with asset location is at the firm level, at the compliance level, right? Where you have an account that doesn’t match you, you end up with two accounts, neither of which matches what you know was in the, the client’s invest IPS in the first place, right?

Jack Sharry: The investment policy statement says you’re gonna have a, you’re gonna be a moderate growth investor and you end up with two port separate portfolios, one with. Just growth portfolio. And another one’s like a, uh, income portfolio on the other side. And firms even compliance systems can’t account for that.

Scott Smith: So they end up getting, you know, warnings saying, you know, this account is out of, doesn’t match the portfolio we’ve assigned to it. Uh, doesn’t match the, the metrics don’t match what we are expecting answer for this. And an advisor who’s trying to do the right thing is just limited on that basis. Or by the same token, they might, you know, the advisory fee schedule might not link as well as it should. So a client with, you know, a $200,000 account and a 300,000 account isn’t getting that 500,000 breakpoint. It goes back to the systems we built in the first place of, we’d never assume these things would have to work together. Mm-hmm. And mm-hmm. With all this organic growth, everyone’s just kind of making two with the next, you know, the next thing we need tomorrow, not what we’re gonna need.

Jack Sharry: Five years from now and that, you know, there’s so many built in challenges with getting it there. The proposal systems don’t match, the compliance doesn’t match, the tradings don’t match. So it’s a future state that we all enjoy, but there’s like, there’s so many steps to get there for most firms that they can’t tie it all together and.

Scott Smith: It has to be easy for advisors and clients to understand. And, and that’s the real thing here. We’ve, we’ve seen that with everything, right? When we ask people, you know, on a standalone basis, you know this, you know, would you rather invest in companies that are good for the environment? Yes, I would. But they don’t ask their advisors for it.

Jack Sharry: Or advisors might think that they’re interested in it, but they. They don’t know exactly know how ESG works, so they don’t wanna be, they don’t wanna have to answer that second question from a client with the, where the advisor doesn’t really know the answer. Same thing comes in, in, in UMH, is that I get the, you know, tax loss harvesting, I can explain that in a single account, but once it’s, you know, I’m gonna sell something over here.

Scott Smith: I’m gonna buy something over here and we’re gonna offset and we’re gonna fix the asset allocation that way, like these things get complicated and once there’s, once there’s four arrows on the chart. You’ve lost everybody.

Jack Sharry: So I, I had a chat with, uh, one of the people that heads up a very large platform among the industry’s largest household name and on this topic of, of single account versus multi account.

Scott Smith: And basically the answer was, well, it’s the best we can do for now. Meaning, right, the best we can do for now is single account. ’cause the, the other stuff is just we, our systems aren’t literally set up for it. And that’s pretty rampant, but that’s changing. So. May add one other. If we’re talking complexity, add the, the bigger, even more complex challenge of retirement income or multi account income generation because you have qualified non-qualified accounts.

Jack Sharry: You got all sorts of rules like RMDs and you got tax. I. Situations and, and as you’re, especially as you’re drawing down, you gotta sell some stuff to draw down and do you wanna do that in a tax efficient fashion? So I’ll just weigh in with what we see. Oftentimes firms, a number of big firms we work with, they actually start with the retirement income.

Scott Smith: Mm-hmm. And the reason they start with the retirement income is. Their systems are, aren’t well set up for the asset location, but at least for the income, at least the way our software works, it’s a little easier for them. And also there’s a kind of a crying need, you know, where this year is called Peak 65.

Jack Sharry: More people turn 65 this year than any point in history or, or going into the future at this point. So people are looking for a retirement income solution. But what do you find, as you have you, as you have your research conversations, are they favoring. Asset location, are they favoring? Well, certainly there’s a lot of the 55IP lookalikes.  I see those all over. That’s all good. Good step forward. But is it asset location or retirement income that you’re hearing more about?

Scott Smith: Yeah, I think there’s, there’s a more obvious impact to retirement income because it, you know, it’s, it’s money leaving account and ended up in clients’ checking accounts or you know, their back pocket, if you will. Right. So I think, and, and advisors I think are willing to admit that they don’t understand all the. All moving parts here, right. Just when it comes to social security, you know better than I, but I think there’s 500 variations that each couple can go through as far as timing and distributions and deferrals.

Jack Sharry: Actually, Scott, there are 2,700 rules on social security. Okay. We actually, we have someone on our, our team who actually knows them all, but in any event, there’s way too much to keep track of.

Scott Smith: Right. So we end up with, you know, an advisor trying to figure out that, I think that’s well beyond the capabilities, right?

Jack Sharry: So we need a tool for that. And the, the rules of thumbs we had in place, they aren’t necessarily correct anymore. Right? It was always deferred taxation as long as possible. Mm-hmm. Maybe that’s the case, but maybe if you retire at age 60, you’re better off pulling from that traditional IRA between 60 and maybe de social security at age 70 because you know, you an 8% raise every year, you defer social security. I can’t guarantee an 8% raise on anything else. So kind of keeping those things in mind, and sometimes in that scenario, it means some of the assets leave the account earlier and the advisor gets paid less. Yep. That’s gonna be the cost of doing business.

Scott Smith: It’s not always gonna be deferred, deferred, defer. You need to be, you know, make sure you’re being a fiduciary on this and make sure you have the backup to understand why and how. We’re making these decisions and you can explain ’em to the client back of the envelope. That’s not gonna happen. But with a, a process driven system where you can account for all these factors together, the advisor can, all they know need to know how to do is to enter the things properly.

Jack Sharry: And then they get some output that explains here’s what we’re doing and why, and why this is gonna mac your eyes, maximize their outcome. If they have something they can be confident to put in front of a client and say, here’s what we’re doing and why. And in that scenario. I think they can account for all the variables and can answer that second and third question because it’s either, it’s all laid out there and they’re, the things become intuitive once you’ve done it two or three times.

Scott Smith: And I think that’s the, the real break. And to your point, ridiculous demand for retirement income. Peak 65. And this is a thing we’ve come to kind of common elements of portfolio construction, whether it’s a 60 40 portfolio or you know. Low cost equities and you get some alpha elsewhere. So portfolio construction and management.

Jack Sharry: We kind of get that preto analysis. We’re, we’re pretty close, but when it comes to retirement income, there is millions of people. You know, I started off on a phone group at Putnam Investments almost 30 years ago, setting up systematic withdrawal plans on a dollar basis. Sure. That’s, you know, when I talk to people, that’s still the default retirement income tool is yeah, the 4% rule.

Scott Smith: Yeah. Systematic withdrawal of a, a percentage or a dollar amount, and very little regard to the other things going on there. So, sure. We have 300,000 advisors, around 300,000 advisors in the us. You know, there’s several thousand of ’em that I’m sure retirement income experts, but that’s also several hundred thousand who aren’t so. This is really the, the greatest need that firms can really provide right now.

Jack Sharry: So where do you see things going? What’s your crystal ball telling you in terms of where we go around the two topics, specific topics of asset, location, and income generation. Where do you see things going?

Scott Smith: Yeah, so I think that the thing we can expect here, it’s really incremental adoption and it’s gonna be governed by budget and firm level commitments, right?

Jack Sharry: These things are not easy to put in, they’re not cheap to put in. So firms are basically gonna have to do their own Pareto analysis at the firm level for each of these things, right? What’s the most important, if we, all of our, for average client is age 63, it’s probably gonna be that retirement income, right?

Scott Smith: But if they’re looking to, to build on those age fifties, you know, age 55 rollovers, as the location could be the core of that, could be the first step for them. So I think that’s what the firm has to decide. And I think we look at the metrics. The average advisor is over age 55. Their average client as well into their sixties.

Jack Sharry: It’s gonna be retirement income for the most part. Yeah. You know, you can add on asset location and tax transition, but for the bulk of their clients, you wanna make, you know, if you have 80% of your book is clients over age 60. You’re not a retirement income expert, they’re gonna start looking for somebody who is.

Scott Smith: Yeah. So I think that’s the real, the real leakage worry here is making sure that our advisors are viable retirement income experts. And that’s seems to be the most obvious thing for them to do right now. You know? And when it comes to how they do this, you know, some firms are gonna build up, you know, at least start to try to build a proprietary solution.

Jack Sharry: And then they’re gonna get involved with, oh, but these three factors we’re not accounting for. And then they might get frustrated and they start looking for, you know, they get frustrated internally. They start looking for outsourcing partners. I think that’s probably gonna be the way to go for most of ’em because, you know, even understanding their own systems and getting them to work together are hard enough, you know, before they start trying to layer on this, you know, these five different complexities that retirement income’s gonna add to it.

Scott Smith: So kind of building those system, you know, having their internal platforms with kind of an overlay of retirement income that can draw from all of those seems like the path forward for most of them, rather than trying to rebuild everything from the ground up to work. Together, uh, efficiently.

Jack Sharry: We agree and we’re recording this podcast before Thanksgiving. And as I’ve indicated to Scott, ’cause I didn’t want him to be blindsided, be on the lookout for an announcement early in December about a lot of things that Scott just talked about. It’ll have, uh, life Field’s name on it and maybe one other on that. So what, uh, Scott just indicated is needed, uh, may well be available soon, sooner than later. So all. We’ll keep you, um, with bated breath, wondering what the heck I just said. But, uh, stay tuned. More to come on on that front. So as we look to close out here, Scott, what are some key takeaways you’d leave with our audience in terms of what they should do? What should they should be thinking about?

Scott Smith: So I think that the most important thing for me is that everything that we discuss with tax optimization is great, right? it only matters if advisors use it. So lack of adoption is the barrier to a real impact here. The way I like to frame this is, um, there was a gentleman named Sha Shingo who led Toyota’s engineering development process for like 40 years, and he put it all together for me, right? It’s, he said there are four purposes for improve.

Jack Sharry: Making things easier, better, faster, and cheaper. And that these four goals appear in the order of priority. Easier is first. Easier is always gonna be first. It has to be easy to understand. It has to be easier for advisors to use it than what they’re doing right now. And it has to be easy for, to explain the benefits to clients.

Scott Smith: So I think that’s the most important thing is we, we do all these things. I remember. When I was working on a sales desk, and I would come up with these sales ideas and it’d be like, oh, Roth conversion. Here’s what you need to do. It’s a five-step process and no advisor ever got past step three and my, my brilliant sales idea I was gonna make, or you know, I was gonna make a 529 last for hundreds of years, you know, fund generations of college, but no wholesaler or no client, or no advisor.

Jack Sharry: Ever got beyond step three of my seven step sales idea? Sure, sure. So I think we have to keep that in mind here is that it has to be the path of least resistance that the platform has to just be like, oh, here’s the incoming portfolio, here’s what we’re gonna do to it. Here’s how you explain it to a client.

Scott Smith: And along the way, like the system has to be in place. So it’s flexible enough to do with, you know, advisors are, you know, advisors are also kind of. Reluctant to give up discretion in many cases. So, you know, maybe the, maybe the platform has to allow for advisor discretion in all of it and part of it. But in any case, there’s guardrails and there’s instructions that go into it that make it easy for the advisor to run a household.

Jack Sharry: In a UMH fashion than it is to kind of run it as independent portfolios. Mm-hmm. And I think once we get to that state, there’s gonna be a heck of a lot of resistance. Certainly. We’re not gonna get every advisor who’s age 60 to redo their business. You know, they, they’ve been doing it for 40 years one way.

Scott Smith: They’re very successful at it. You’re not gonna teach an old dog new tricks in every case. Yeah. But if every. If every 25-year-old advisor, if every 35-year-old advisor, if every advisor new, you know, is changing, uh, careers at age 45 starts with, you know, kind of a planning focus and a UMH overlay, everyone’s gonna be better off long term.

Jack Sharry: You’re singing my song, you’re, you got I like that tune. So, um, like that. So Scott has been great. Really appreciate your observation. Sharing, sharing what you’ve been learning. And I’m, I know it’s a never ending. Battle for truth justice in the American way. So, uh, keep at it and we’ll have you back to give us updates as you go.  ’cause I know lots of things are changing, lots of people are talking the talk. So as people start walking the walk, that’ll be interesting to check out. See what’s going on there. One last question, and I know you’re well prepared for this and can’t wait to, for your answer ’cause you’re, I know you’re a regular listener, so you know what’s coming as we do with each of our podcasts. Uh, this last question is my favorite. What do you do outside of work that you’re excited or passionate about that people might find interesting or surprised? Okay,

Scott Smith: So back in the eighth grade, I won the award for Class Clown and got my picture in the yearbook on that page of all the superlatives, right?

Jack Sharry: But after that, my comedy career really stalled, right? College, there was a lot of sarcasm. My early career there was a lot of sarcasm. Then we moved into dad jokes, the occasional witty comment in a meeting where I could get, you know, a couple of industry folks to giggle a little bit. I. But I really want knew I wanted to do something else with comedy.

Scott Smith: So back in March, 2023, after my dad driving responsibilities had fallen off a little bit, I started taking improv classes, a place called Kismet Improv in Pawtucket, Rhode Island. Since then, I’ve taken all their classes. I got put on what’s called a house team. So I perform like every other week. Every other Friday you can come down at eight o’clock to Pawtucket and see us on stage.

Jack Sharry: I also, you know, I built a, I’m part of the community there now, right? It’s energetic community of. People younger than me or artistic and have new ideas. I got together with a bunch of ’em. We made some movies. There’s this, there’s this thing called the, the 48-hour film festivals. Essentially, they give you a movie assignment on Friday night at six, and you have to turn in a four-to-seven-minute movie by Sunday at 6:00 PM.

Scott Smith: Done that a couple times. So much fun like working on artistic basis before this, you know. Every week now I’d be like watching TV at eight o’clock or, but now I’m out. Sure. Performing, getting energy infused. I mean, just the way I hadn’t before. I feel so much younger now. It’s Oh, cool. It’s the best thing I’ve done well outside of my, you know, my marriage, my children, and you know, it’s, right.

Jack Sharry: All those other things. Right.

Scott Smith: All those other things that are also great, but this is just brought me back, you know, it’s given me a vitality that I was really missing and I’m just kind of, you know, fading into the background and now I’m like. Out and doing things, and I, I couldn’t be happier about it.

Jack Sharry: Good for you. I love it. And uh, if someone was so inclined, could they find this on YouTube?

Scott Smith: Absolutely. You can check, uh, there’s some examples right on my LinkedIn page. You can click through, click through there and kismet improv.com. Come buy a ticket. I think it’s $18 for Friday Night Show. That’s great. I’d love to see it. Everyone there.

Jack Sharry: Great. Good for you. That’s wonderful. I love it. So. Terrific. So for our audience, uh, if you’ve enjoyed this portion of the show, we appreciate that. Uh, if you’d like our podcast, uh, please rate, review, subscribe and share what we do here at WealthTech on Deck. We’re available wherever you get your podcasts. Should also check us out on, uh, dedicated website, Wealthtechondeck.com. All of our episodes are there, along with blogs and created content for many folks who are, who are on the industry. Scott, this has been a lot of fun. Really enjoyed it. Thanks for the update and, uh, you gotta get down to Kismet, so, uh, great. Check you out on stage. So thanks so much.

Scott Smith: Thanks, Jack.