SKEPTIC’S GUIDE TO INVESTING
Straight Talk for All, Nonsense for None
About - Our podcast looks to help improve investing IQ. We share 15-30 minutes on finance, market and investment ideas. We bring experience and empathy to the complex process of financial wellness. Every journey is unique, so we look for ways our insights can help listeners. Also, we want to have fun😎
Your Hosts - Meet Steve Davenport, CFA and Clem Miller, CFA as they discus the latest in news, markets and investments. They each bring over 25 years in the investment industry to their discussions. Steve brings a domestic stock and quantitative emphasis, Clem has a more fundamental and international perspective. They hope to bring experience, honesty and humility to these podcasts. There are a lot of acronyms and financial terms which confuse more than they help. There are many entertainers versus analysts promoting get rich quick ideas. Let’s cut through the nonsense with straight talk!
Disclaimer - These podcasts are not intended as investment advice. Individuals please consult your own investment, tax and legal advisors. They provide these insights for educational purposes only.
SKEPTIC’S GUIDE TO INVESTING
Alternatives, Women, and Wealth: Megan Smith
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Women are consistently outperforming men in investment returns—by about four basis points—yet they're starting later and investing less. This fascinating paradox lies at the heart of our conversation with financial services veteran Megan Smith, who brings decades of experience in alternative investments and client advising to the table.
"Investing is more about patience and consistency than it is about number crunching," Smith reveals, challenging the notion that successful investing requires complex mathematical skills. Instead, she points to women's tendency to be less emotional about their investments and more focused on long-term goals as key factors in their outperformance.
With women currently controlling 32% of global wealth—a figure projected to rise dramatically as wealth transfers from older generations occur—the conversation around women and investing has never been more relevant. Smith shares personal insights from her journey from marketing to sales in financial services, highlighting how her father's simple advice to maximize her 401(k) contributions shaped her financial future: "You'll never see the money, therefore you don't need it."
The democratization of alternative investments emerges as another crucial theme, as assets once reserved for institutional investors become increasingly available to individual investors. Smith offers thoughtful guidance on how millennials and Gen X investors should approach alternatives differently than boomers, emphasizing that time horizon is everything when considering less liquid investments. Her perspective on crowdfunding platforms, values-based investing, and the risks of including alternatives in 401(k) plans provides a balanced view for investors of all experience levels.
Whether you're just starting your investment journey or looking to refine your strategy, Smith's practical advice—start early, maximize employer matches, and develop a thirst for financial knowledge—offers a roadmap for success. Tune in to discover how you can build a portfolio that aligns with both your financial goals and personal values.
As mentioned on the podcast, here is the link to a charity Megan Smith supports:
Straight Talk for All - Nonsense for None
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Disclaimer - These podcasts are not intended as investment advice. Individuals please consult your own investment, tax and legal advisors. They provide these insights for educational purposes only.
Hello everyone and welcome to Skeptic's Guide to Investing. Today we're having an interesting interview and discussion with Megan Smith. Megan and I are connected through Providence College. She's a board of trustee member at Providence
Steve Davenport:I went to Providence and Megan has a lot of experience in the financial service industry her whole career and I just thought it would be interesting to look at what's happening in this space, particularly alternatives, with somebody who was deeply involved in how alternatives fit in various clients and various situations.
Steve Davenport:So I think there's a lot to talk about, but one of the things that we've been trying to do is to focus on how women view investments and how women view the ability to make better choices and better outcomes in their life with finance. I think there's a lot of clouds hanging around women in investing and I think we need to clear them out and try to make it clearer what you should do and how you should do it. So, as part of our goal in Skeptics to improve the overall wellness of individuals, we'd like to focus on women and how we make that wellness more successful for them as well as everyone else. So I guess I'd love to hear Megan kind of tell me a little bit about where you come from in terms of growing up around the ideas of money and then going to work and working in the financial industry. And just give us a little bit of the Megan Smith 101 so that we can dive into more topics.
Megan Smith:Perfect. Thanks, Steve. I appreciate it. I actually grew up the oldest of five children in Worcester, Massachusetts. I would say that around the dinner table we weren't talking about finances. There was a big age gap between the oldest and the youngest. It was hard at the in Worcester Massachusetts, I would say that around the dinner table we weren't talking about finances. There was a big age gap between the oldest and the youngest. It was hard at the dinner table to come up with conversation that everyone could be involved in. I grew up in a very kind of traditional Irish Catholic family of people of that time where my father worked, my mother stayed home and ran the house and we didn't have a lot of money when I was younger and my mother had a budget that she had to work within to feed us and to clothe us and she could always do that. But she was never the one that did the investments. She was never the one that looked for how to invest or how to save or where the best mortgage rates were coming from. My dad did all of that and so without that education I kind of grew up and had to talk, had to teach myself. So I graduated from college. Thank you for the Providence College. Providence College mentioned there, steve I went to New York and started working in the marketing department of what was the former Dean Ritter Reynolds, which is now was was purchased by Morgan Stanley, and I worked in the marketing department and I learned a lot.
Megan Smith:But what I learned very quickly was if you wanted to make any money in financial services, you had to be on the revenue generating side of the business, so you needed to be on the sales side. So I got myself, therefore, involved in a sales role. That was account management, product development and I've done that with mutual funds, variable annuities and probably for the last 20 years of my career in the alternative investment field developing product, bringing it to market, presenting it, dealing with regulators and custodians, as well as educating sales forces and home offices. All of the products that I represented were sold through a financial intermediary.
Steve Davenport:Yeah, I mean I think that that background seems awesome for what is going on today. I mean, you must feel like all of these discussions about alternatives and adding them to 401ks, and what's happening with crypto and what's happening with the markets. I mean, this has been a year of quite a bit of change and I guess I feel as though you know women in general, because of the pay differential, because of disruption in career, because of a lot of things extra, you know, a longer lifespan means you're going to have a longer retirement, but that means you're funding a longer retirement. So, how do you feel about the gender gap This podcast what do you think we need to do as individuals to help others who are not in the finance industry get better results and avoid some of the gender gaps?
Megan Smith:You know it's interesting. You say that Women tend to start investing later and invest less because they carry more fear. So, to your point, as they're living longer, they end up having less money to live on in retirement. What's really interesting, though, is a third of women see themselves as investors, with the majority of them saving consistently. So a third of women see themselves as investors, with the majority of them saving consistently. So a third of women save money consistently. And, interestingly enough, as compared to their male counterparts, they tend to outperform men by about four basis points. So you might ask why about women investing? Is they tend less to be emotional about it. They tend to be more consistent, less impulsive and more focused on the long-term goal, which is retirement. So the issue is not necessarily capability, it's confidence in being able to do it, and then access. And how do you teach, having been brought up or educated in the school systems, how to invest with confidence and get access to it.
Steve Davenport:Yeah, I mean, I think that yesterday we had this financial literacy friend who you know. It's all about taking that knowledge and then doing something, and that's the big. We can deliver more knowledge to people with AI and everything else, but if it's not going to lead to action, it's going to be hard for everyone and that's where we're trying to figure out what is the way that you can behaviorally help people so that they don't look at you as prescribing, they don't look at you as scolding, they look at you and say, hey, he's trying to help me understand the perspective and give me a good long-term result.
Megan Smith:Yep.
Megan Smith:And I think yeah, Steve, I think the best way to do that is start them young and get into the habit of investing in their 401k. I will say that was one thing that my dad did for me when I first started in my career. He said to me put as much money away in your 401k plan as they will allow you with the company match and what he said. I'm like, yeah, but I need that money for my rent or I need that money to go out on a Saturday night. He's like you'll never see the money, therefore you don't need it. So begin investing when you're young and if five or $10, that will compound into a decent, into a decent um amount of, to a decent nest egg when you retirement, I should say um. I think that investing is more. You don't need to be a math guru.
Clem Miller:Investing is more about patience and consistency than it is about money crunching that's great, thank you um, megan, um, if you had to look around and identify which you know women investors, like some more famous women investors, uh, women who are younger, uh, should should model themselves. After who would you recommend and why would you recommend them?
Megan Smith:Huh, that's an interesting one, so I would actually and it's going to be someone that not everyone knows there was a female investor and female advisor that I worked with in a large broker dealer that I worked with. She was a really interesting woman. She ran her own business. She had a husband and two kids. She ran an investing business. She had probably 30 people that worked for her and then, as she got older and her condo in the city was paid off and her children were launching and educated and she was still working full time, she and her husband had the ability, because of her investing and understanding the markets and going out and educating other people on the markets and educating the people that worked for her on the best thing to do. She and her husband were actually able to buy a lavender farm in Michigan.
Steve Davenport:Nice, nice. And when we think about some of the people and women, you know, what do you think are some of the myths that are holding back women? Do you think it's a a reality? I mean, I I agree with you that, in returns, I think women are more balanced and probably more um likely to follow along, um I think there's a lot of misandhold back women, someone else to do and they just did.
Megan Smith:I lose you guys. Yeah, a little bit.
Steve Davenport:It seems like you might've been um, maybe we just um go with uh, uh, no video and we'll try that and see if it it gives us a better recording. Is that okay?
Megan Smith:Great.
Steve Davenport:What do you think?
Clem Miller:Yeah, sure, I'll turn off my video.
Steve Davenport:Um, so anyway, I I think that the myths about women are very, you know, I I find the whole education and the system is is is not really clear about. You know, women tend to perform very well in the earlier grades and then somewhere around middle school, things get a little more difficult and boys become more aggressive, and it just seems like there's the. The things that we need to do, like you said, need to start earlier. I think that's the key.
Megan Smith:Yes, and education Steve.
Steve Davenport:Yeah, Um, so it's. It's really uh, as you mentioned, about trying to start earlier and get better returns through your results.
Megan Smith:You know, an interesting thing, steve, is as we start to see more women working full time, as we start to see kind of some of the gender gaps start to balance out. Women control about 32 percent of all global wealth and that number is projected to sharply rise, especially as wealth transfer from older generations moves.
Steve Davenport:Yeah, I agree.
Megan Smith:So there's a lot of things that are going to happen in the next 20 years and it's across all different types of assets, different types of asset classes and, as this generation starts to leave us, there's going to be a lot of wealth transfer that's going to go into the hand, into the hands of of women.
Steve Davenport:Yep.
Clem Miller:That raises an interesting Megan. That raises an interesting question. So you said 32% worldwide. Obviously there, I would imagine, there are big differences worldwide. I'm going to guess that Europe is much more advanced in terms of women holding wealth. Well, what do you observe in Europe that you wouldn't observe here in the US or elsewhere?
Megan Smith:You know it's interesting. You ask that Clem. Europe is just so much. It's so very different than the US. What's interesting about Europe is they tend not to talk about wealth as much, but they tend to educate more. So the things in Europe that are kind of quiet and not talked about as much investing wealth, money whereas in the, the us, we talk more about that and we show more wealth, but we don't talk about things like um, sexual behaviors and things of that nature that are much more politicized in europe. I think that europe has just done a really at not broadcasting but of educating and giving women the confidence that they can actually succeed in this.
Clem Miller:Do you know, when you look at women versus men, do you observe that women invest differently, like are they? Do they sort of focus more on some asset classes rather than other asset classes, for example? Or, yeah, so behaviors that are different, or are there behaviors that are different?
Megan Smith:There are behaviors that are different. As I mentioned earlier, they tend to be more consistent and less reactive to the market, so therefore they tend to weather storms better than their male counterparts. Millennium women, which is interesting, are more likely than some of the older generations to invest in alternative products than millennial men are.
Clem Miller:Really.
Megan Smith:Yes.
Clem Miller:Why is?
Megan Smith:that they have a better, they believe they have a better education. They talk more about crypto. They've learned more about options and futures in college or graduate school classes and they believe they know more.
Clem Miller:I hear the believe they know more as part of that.
Megan Smith:But it's interesting, clem. The stats I have are for millennials 24% of them will invest in alternatives. For Gen Xs it's 20% and for boomers it's only eight Right Now. That could also mean that many alternative asset classes are illiquid, so it would not be smart for a boomer to be investing in alternatives as a new asset class. For millennials and Gen Xers. It would be a little bit more mainstream.
Clem Miller:Right, so let's jump into alts for a bit Sure. So obviously there's been a big push and I treat alts very differently than crypto. By the way, I treat crypto as I mean. My own view is crypto isn't really an asset class, but it is very speculative. I don't want to call it asset or even investment. It's gambling, essentially.
Megan Smith:I do agree with you. When I think of alternatives, I think of things like real estate, private equity, private debt credit. I throw maybe some VC in there and maybe a little bit of something like a tangible item, like artwork.
Clem Miller:Right right.
Megan Smith:Art collections.
Steve Davenport:Yeah, yeah, I think that the art is part of the problem, though. Right, because you look at art and you look at crypto and you say it's an asset that has a place, but is it an investment? And I look at art and I think of it as an investment, but I still have trouble thinking about crypto the same way, Because I view that you can absorb a benefit from having art hanging in your house. You enjoy it all the time Whereas crypto I'm not sure what the enjoyment level is, or, you know, I don't know. The benefit of crypto, I guess, is my-.
Megan Smith:I would agree with you on that, steve. I kind of put art in the same asset class as I would put real estate in. It's something that you can use and enjoy, but it's nothing that you want to have to sell, because if you have to sell it for a reason, you're going to get what the market's offering on that particular time, versus if you're not emotional about it or you don't use it to need something, you can actually trade it when the market will give you the best price right.
Steve Davenport:Well, I look at things like collectibles and art and think you know they have a much longer time frame. So if you're going to invest in these, you have to be willing to wait because the transaction costs are so high.
Megan Smith:Correct, and that's kind of like real estate.
Steve Davenport:I still can't believe we're talking about a 6% you know commission and maybe it's starting to change with the new laws around realty, but it still is such a transaction cost where the market has no transaction costs. Now you know it's. It feels like these other areas I would have thought have been would be going down the curve and would be at three or four percent with real estate and would be you know and lower commissions for the art space. I mean, I bought some art online and it's it's interesting how you know how it's priced and how you maintain it and how you know how much commission there is in storage and transaction costs.
Megan Smith:No, I agree with that. I think we start to see some of the commissions coming down, but to your point, Steve, they're nowhere near where they should be compared to other asset classes.
Clem Miller:So, megan, obviously one of the downsides, or the downside of alts is liquidity, correct, and while younger people can probably stand to have a little bit more illiquidity in their portfolios, it's still an issue and you know younger people do have, you know, occasional needs for liquidity, so it's not something they can completely ignore, completely ignore. So you know. My question is you know why, you know if, if there are, you know, a private credit, private equity, private, you know other things that are being issued out of Blackstone or Apollo or Aries or whatnot, why wouldn't you just you know, why wouldn't a young investor just buy those stocks, buy Blackstone, buy Aries, buy Apollo, just buy that because it's liquid.
Megan Smith:Buy the firm stock you need versus buy the firm stock.
Clem Miller:Buy the firms, why not?
Megan Smith:Well, I think what you see is, with like many things, higher risk becomes a potential for higher rewards. So over the long term, if you see what alternatives look like again over the long term, this isn't for immediate investing. If you need money immediately, buy the stock of the company. But if you're long term investing for your retirement funding, which is something you're not supposed to touch until you're over 65, then put some alternatives in there. Not a lot. I don't know what the right number is for the right person. A lot of asset allocation models show 20% for the millennials and the Gen X ages and then they can weather out the storm if there are some bumps in the roads and when there are bumps there are going to be big valleys and big peaks but over the long term it will return and add to their retirement funding. If they need money to buy a house, that's not money that should be invested in alternatives Absolutely not.
Steve Davenport:When you look at alternatives and I've, you know, seen this throughout my career is that things that used to be for investors of 5 million or up, or 20 million and up, have now come down to investors that are 2 million dollars and up, and I think it's the democratization of the markets. Do you, do you feel that that democratization and going down to lower and lower client levels in terms of sophistication, or just in general, the ability to lose money, um, I mean, do you think the endowment model really transfers to the individual, or is it something that the industry is telling us is a good and that actually more individuals are not a lot like endowments because they don't have such a long horizon they have, you know, this Friday, when I get paid, is what they're looking forward to.
Megan Smith:Correct. So, steve, I'll answer that in a couple of different ways. One is endowments invest 30 percent or more on average. Big endowments invest 30 percent or more into alternatives. That is probably too much for an individual investor to be able to handle. I don't think an individual investor is like an endowment. Not only does an endowment have a much longer time horizon, they typically are so well-funded that they don't need a lot of cash out of that. So the cash funding that they're getting from their other 70% of their investments is more than enough for what they need. Individuals are not like that. They need money for today. They don't need money that's more than just their paycheck on a Friday afternoon. So I don't think that they should model after an endowment. I do believe that the younger generation even to some degree my generation should include some alternatives in their long-term investing, but not as much as what an endowment adds.
Steve Davenport:Right. I've seen people and Clem will remember this at M&T that they think about private equity and think about taking it out of your equity allocation and think about private real estate and taking that out of your public real estate allocation so that the amount of actual real estate and I think the most exciting thing happened is in the fixed space, because I think the private credits, where interest rates are so low, relatively speaking to history, whether we're at 2% or 4%, it's still, I'd say, in a lower bound. Does the benefits of private credit are rewarded by the extra return or do you think it's an appropriate mix? You're getting a higher return but you're taking a higher risk.
Megan Smith:Correct. I think it is the right balance the higher risk with higher return. However, I keep wanting to focus on time horizon. Their time horizon has to be long. This can't be for an immediate investment. You've got to be looking at it over the long term. So, steve, when you get your paycheck or you get your monthly statement from wherever you invest, when you look at the alternative one, you can't be saying, well, that didn't go up as much in the higher percentages as everything else did, because it's not going to. If you're looking at on a month or quarter to quarter basis, you've got to look at it on, I would say, more than an annual basis.
Steve Davenport:No, I agree, it takes a different perspective in order for you to benefit, because you've got to be patient and you have to make sure the person is educated enough to know that that this is a patient run.
Steve Davenport:I think. I mean, do you want to talk a little bit about crowdfunding and some of the things that are going on? Because I think the you know, I looked at some of these real estate and farm investments where you can, you know, own or lease a piece of land and the farmers basically produce something on the land and then you, you know, it's like owning a farm but you don't have any of the manure. Do you think these investments? I looked at him and said, boy, there could be nothing less correlated to ai than this piece of you know, bean farm in north dakota. You know, and and I, I don't know. I think it's kind of exciting that we have all these choices and people who do the, uh, the loans, you know, and they say I, I need four thousand dollars and I'll pay you ten percent, and you know it's I, I just think it really has.
Steve Davenport:The internet and the use of these different vehicles has really created a very unique opportunity where you know it used to be. You had to buy IBM or GE, and now you can buy, you know, pieces of land, pieces of housing, pieces of everything, and it almost seems like we've become, you know, the Amazon of financial services with all these different choices.
Megan Smith:You know what's interesting Steve is? You know. You said going back to what did you say? Was it AT&T and IBM? You said you know which?
Megan Smith:is probably you know the fan companies it's for it's it's Facebook, apple, netflix, google and I think those have a right place in everyone's portfolio because they are with. You know what we don't call blue chip stocks I haven't heard that term in a while. But these crowdfundings and things like that, I think are really only for high net worth people who can afford to take that risk and afford to take that loss if it happens. I don't believe they're for the everyday investor.
Steve Davenport:Yeah, I just remember my uncle used to come home from the post office and he'd meet my father and they'd sit there and have a cup of tea and some cookies and they'd debate whether GE was better than IBM. And you know it was the classic kind of well, I don't know that GE leader. You know that guy. He really knows how to, how to balance the, manage the balance sheet and you know they would all watch. Well, you know William Rukeyser on Friday night.
Clem Miller:And.
Steve Davenport:I just think that money and culture, you know, have changed so much, right? I mean, it used to be something you talked about, you know, once a week and you know my father wanted to be up to date, so he was reading his journal on the, you know, on the T, on the way to work and it was like, hey, did you see this article? And I think, about the way information is transmitted, you know, instantaneously around the world and immediately something happens in Taiwan and we know about it in know a matter of minutes. It just feels like there's a it used to be a much more of a culture where you kind of you thought about these things and you did these things. You know there was much greater ceremony and pomp around.
Steve Davenport:You know, I made an investment today, you know, I remember when I was caddying and I made my first investment in Unocal and they had this thing called shale that they thought was going to eventually be pretty big, and I was invested in it 20 years before shale became, you know, and I didn't do particularly well, but it was a concept that these people kept talking about and I was like, well, I get the long horizon, I can invest in this and, as a reality, I needed a new bike and my investment in Unical went south.
Megan Smith:You learned a very valuable lesson at a very young age.
Steve Davenport:Right.
Clem Miller:Megan, if I might let me, on the alternative issue still, but focusing on the whole 401k aspect of this, this whole kind of push by the alts companies, the alts providers, and the greater acceptance by regulators of putting alts into 401ks.
Clem Miller:Regulators of putting alts into 401ks, and I'm sort of wondering what you think about that. And you know I have a specific question, which is, you know the, you know, when companies make 401ks available to their employees, you know they, you know put they put together lists of potential investments and, while it's ultimately up to the employees to select from those lists, if there are any bad investments that show up on these lists, you know, judged from an ex post perspective in terms of performance, those companies can get sued and do get sued. And so you know what's the tension there Are we going to see, are we really going to see that much use of alts and 401ks because of that litigation risk, or are we going to see, you know, greater adoption? As you know, regulators push as the alts companies push, you know, is somebody going to offer litigation protection? Or I mean, how is this all going to work?
Megan Smith:I don't think you're going to see anyone offer litigation protection and I think you are going to see an increase. You are going to see an increase in knowledge just because we're going from zero, so of course it's going to increase. I think the question more is how much is it going to increase? And I go back to education and those 401k providers need to put a cap on how much people can invest in alternatives, and I haven't read anything that says that their plans are capping that and they need to be capped. Everyone obviously doesn't need to be capped at the same number, but, based on people's outcomes and what people's financial literacy, financial needs look like, there needs to be some sort of a cap on how much money they can invest in alternatives, isn't?
Steve Davenport:this kind of like what happened with the company stock, where it made sense to say you shouldn't own more than 50% in company stock, but people working there felt, hey, I know this thing better than I know anything else in my life, so I'm going to put it all in and then eventually they had to take it away because there wasn't the ability to cap. I don't think in 401ks and it feels to me like if you add more risk, the people who are more desperate are going to be taking that risk as much as they can, because they've fallen behind because of other circumstances in their life, and it just it feels like it's a button you're going to press if you get desperate.
Megan Smith:You know the other thing, that it comes back. Another thing we've talked a lot about education and education at different ages and different types of investments at different ages. The one thing that we haven't talked about is the power of the investment advisor, and if someone has a financial advisor that is assisting them with this, that will also help, kind of. It's not perfect, but it will help make the peaks not as high and the lows not as low and make it a little bit more consistent.
Clem Miller:Do you think that more young people have investment advisors today than they used to do in the past? Do you think there's greater acceptance of investment advisory, or are people doing a DIY more?
Megan Smith:Clem, I tend to think that people are doing DIY more and, simply put, because it's cheaper and they think these young people think that they know a lot. Yeah, I think when you get, when you look at older people, you know I don't want to, I don't want to put a specific age out there, but when you're talking about us.
Steve Davenport:I'm talking about real old people.
Megan Smith:Or you know, I'm not talking about kids right out of college. You say to yourself OK, maybe it's time that now I have a little bit of a nest egg. I've done okay on my own. Now I need some help and some advice, and I need somebody to help me with this, because I'm not fully trained to do it.
Steve Davenport:No, I think that's a great point, and the other part about alternatives that we haven't really delved into but I'm very interested in is this idea of you know, investing for your values or investing for your principles. You know we have a strategy about um that's aligned with what the U S Catholic bishops think are socially responsible investing, and we pick from that universe so that we know that, whatever portfolio we build, we'll have, you know, the right, the right values or the right principles underlying it. Do you? How do you feel about values-based investing? Do you do any yourself? And what do you think for people who?
Steve Davenport:I like it, because I believe that if you're investing in something that you believe in value wise, you're less likely to be a seller at the wrong time. If you're, if you're investing in something that you believe in value-wise, you're less likely to be a seller at the wrong time. If you're behind a company and you think they do things right in terms of charitable contributions or other impact to their employees or community, I think you feel better about it and you're going to be a better investor and therefore you're going to have better returns. Is it really that simple?
Megan Smith:You know, Steve, I do agree with you, but remember that when you're investing that way, you're investing with your heart, not necessarily your head. So my gut would tell me that you invest that way. But invest very carefully and very limited. You will probably weather a storm better because you won't have the emotion. No-transcript. But it shouldn't be the largest asset in your portfolio.
Steve Davenport:Yeah, well, I mean, the beta of the portfolio is still 0.98 or what you know. It still has a lot of good names and a lot don't get. You know, it doesn't own the military, the Raytheons and the others, and it doesn't own some of the weapons and it doesn't own some some healthcare. But I guess I'm just saying do you do you find that yourself you gravitate towards? Uh, uh? I don't know if you've heard of the state street uh ETF, she, um, that goes and tries to find companies that treat women better in terms of their, um, you know, management team and how many women on the boards. I mean, I, I kind of think those things. I thought they would be more popular with women in general, with more popular with people wanting to be values-based.
Megan Smith:I actually did not invest that way personally.
Steve Davenport:Okay, and do you think it's a return thing, or you just find yourself more, more attached to, to things that you understand more?
Megan Smith:I would say it's twofold, steve. I look at it as being a little bit more of a riskier investment because you're investing more with your heart than you are your head, and my more riskier investments just in my personal portfolio are more alternative driven. Riskier investments in my just in my personal portfolio are more alternative driven. There's. I don't any more in there because it's just, in my opinion, going to increase the risk portfolio, the risk in the portfolio.
Clem Miller:Okay, in a sense, you've chosen where to put your risk.
Megan Smith:I put my risk in alternatives.
Clem Miller:Right, exactly, whereas some people might choose to put their risk in more value areas, in values-driven areas.
Megan Smith:You know, as is all of investing, it's a personal decision, right.
Steve Davenport:Right people who are getting started, in terms of if you know your prescription to somebody who's younger and trying to start off and figure this out, are there things that they should? You know some guidelines they should follow in terms of how to get started?
Megan Smith:yeah, um, you know, I think they need to. It depends on different age groups. Um, I did find some stats for this that women typically don't start investing until they're 27 years old, which I think is too late. They've missed five years of that money compounding. I think you should start as soon as you graduate from college and put something away, as my father did teach me that you need to kind of look at what your overall goals are going to be, both short-term and long-term. So do you want to buy a house? If you want to buy a house, you need to be invested in more liquid assets. If you're investing more for retirement, you can do some of these more riskier investments that we've talked about that have a more long-term time horizon. I think that the investors should pick what type of platform they want to invest through. Think that the investors should pick what type of platform they want to invest through. So do they go to a place like Fidelity or Vanguard, or do they go to a trusted financial advisor? That's, a person that can help them understand their needs and goals and then execute on them?
Megan Smith:For the younger generation, I would say start small, but maximize everything you can. If you've got a Roth, maximize it. If you've got a 401k, maximize it. If you've got an employee stock purchase plan, maximize it, because you'll never miss the money that comes out of your paycheck. You could never see it. And then I would also encourage people to have what I call a thirst for knowledge and educate yourself, whether it's online articles, whether it's podcasts like this, whether it's getting a subscription to Barron's Do something that helps educate yourself so that you understand what's going on and you can take an active role in managing your future.
Steve Davenport:No, I think that's great. That was a great advice. That's great advice. When we talk about investments, we're trying to expand the concept a little bit into how you invest your time and how do you invest in things in the community that help, and I know that you're committed to PC being a trustee, and Providence College has been very good to a lot of people and I think it's a great place to to make an investment. But can you just talk to me about personally, how you feel about giving back in your time or treasure and and just what what it means to you in terms of, uh, you know, is this investment as important as some of the other ones you're making?
Megan Smith:I think for a well-balanced person, you need to invest in more than just money, right? I think you have to invest in people. I think you have to invest in your community. I am very involved in the Melanoma Foundation, a not-for-profit called Impact Melanoma. I have sat on that board and I was actually the clerk of that board for a little while I timed off the board. My husband passed of melanoma when he was 45 years old, so I have a very personal connection there and want to help educate people on the importance of sunscreen shame, all of that. So that's kind of a little bit more of a personal connection. And it started very small. This started very small in Boston is now it's got tethers out to to other areas. So that's one thing. Another thing I'm looking into Steve is giving back in a active way with a committee, a board in Boston that raises money and coordinates the Archdiocese of Boston's priests and their retirement funding and their retirement home and how those priests are taken care of once they're out of the diocesan churches.
Steve Davenport:Wow, I'm sorry to hear about your husband, yeah.
Megan Smith:Thank you, but I do try to you know, all of those hit me at a different place for my personal experiences, and I think that's very important. You've got to. If you're going, in my opinion, if you're going to do something that you're not being paid for, it's coming out of the goodness of your heart. It has to be something that's in your heart and something that's very important to you.
Steve Davenport:Yeah, I would love to get those links and share them with our listeners. Um, because part of what one of the advisors we had last week was, you know, talking about. He's graduating from west point and one to support vets and I think that we all look at advisors and we say, oh, let's look at their returns or let's look at what they you know what they're doing or how many people they have on staff. And I think that, looking at individuals and thinking about gee, there are complex people who have done a lot of good things and are trying to help others, not just in the world of finance that they're familiar, but also in these other worlds and these other orbs.
Megan Smith:Right, you know, my father always taught me to which much is given, much is expected.
Steve Davenport:So yeah, I've heard that a few times.
Megan Smith:And he lived it and he taught that. He taught all of us that as well.
Steve Davenport:Clem, do you have any final questions?
Clem Miller:No, I think I've covered all my questions. Thank you very much, Megan.
Megan Smith:Thank you all, thank you both for your time today. I appreciate it. This is fun.
Steve Davenport:Sure, we appreciate having you and we'd love to continue the story and hear some more about some of those charities maybe going forward. So, everybody, thank you for listening and I think today's podcast brought up a lot of topics and really did a good job of covering them. So I thank Clem and Megan and I hope everybody has a great Labor Day weekend and I hope everybody continues, as Megan says, to find that quench for knowledge so they can also satisfy some of their passions. Be good everyone.
