For the past 13 years, Brad Pearsey has been advising people in some capacity. He started out as a life insurance agent, then got his securities license. He owned a registered investment advisory firm doing stocks, bonds, mutual funds and life insurance, before starting his own investment fund.
“Through all the years of doing this, the one thing I noticed about most financial advisors was that they are looking for people with assets,” says Pearsey, who created No Worry Retirement so he could help people in all capacities.
Through his company, he offers a three-pronged approach to financial planning that includes investment planning, retirement planning and estate planning.
“We give our clients the blueprint, educating them about money, interest and taxation,” says Pearsey, who calls himself a financial architect. “We build the structure – their financial household – and it will be exactly what we designed it to be if they do their part.”
The big service Pearsey offers, which many others typically don’t provide, is help for those drowning in debt. According to the U.S. Census Bureau, the average American household debt is $250,000. In addition, CBS News reports that millions of middle-class Americans are just one missed paycheck away from poverty and do not even have enough cash saved to deal with a crisis.
Pearsey teaches his clients how to work their money so they can become debt-free, reduce taxes, and lower the interest they’ll pay over the next 30 years down to nine years, using a program called Your Family Bank. The program teaches folks to stop giving their money to banks, and instead become their own bank.
To help people understand the importance of planning, Pearsey likens it to sports, teaching his clients how to invest both offensively and defensively when it comes to finances. Offense is growing the money, and defense is not losing money through taxes and interest payments to banks and credit card companies.
“We teach a total game plan on finances because I don’t think most people understand how bank loans, student loans or credit card interest works,” Pearsey says.
Let’s say you’ve had your mortgage for 15 years and were paying 5% interest, then your mortgage company offers to sell your mortgage to reduce that rate to 2%. You may jump at the chance of saving a couple hundred dollars a month by refinancing, but the problem is that the first 15 years that mortgage loan is built consists of almost 90% interest, and now you have reset that loan back to the beginning.
“When you refinance, what you’ve done is reset the interest cycle so it’s a big win for banks and a big loss for you,” Pearsey says.
According to Bankrate.com, a newly financed 30-year mortgage of $200,000 at 3% interest will cost the homeowner more than $300,000.
“People’s eyes are opened when they become awakened to this stuff they didn’t know,” says Pearsey, adding that Warren Buffett once said the most powerful thing in the world is compound interest. “That’s true if it’s working for you positively, but it can be very destructive for you and your family financially if it’s going backward.”
For example, say Old Navy offers you a credit card. If you pay the minimum payment on a $2,000 bill, it will take you eight to 10 years to pay it off. You will have paid $2,000 to $3,000 in additional interest.
“Again, this comes back to being both offensive and defensive,” Pearsey says.
Another topic that can perplex many people is taxes. A lot of people want to pump their retirement accounts full of IRA and 401(k) funds. What they don’t realize, however, is how much they are being charged in 401(k) fees and IRA fees by their custodians.
“Plus, they don’t know that they’ll be hit with a tax bomb when they start taking money out of their IRA and 401(k),” Pearsey says.
Once clients understand how much of their money is going to interest, banks, finance companies and credit cards, they are eager to learn more and make some changes.
There are those who haven’t incurred a lot of debt but want to start saving, and don’t know where to put their money. Perhaps they are intrigued by the market but are reluctant to get into it.
“We have great strategies for people who have investible assets where they can participate in the market gains, but have a floor so they can’t lose money,” says Pearsey, whose wife Erica works with him, as does his son Jon and mother-in-law Kathy. Jon not only helps with technology, but is also a licensed agent who is studying to become an attorney.
No Worry Retirement is about helping anybody at any age.
“It’s hard to live paycheck to paycheck,” Pearsey says. “I think most people want to get out of that mode. It’s a lot of fun when you have extra cash or can pull money out, tax-free, to buy a vehicle or a home.”
When Pearsey shares advice to those in debt, the most common response he hears is, “Are you sure this is real? It seems too good to be true.”
For clients who have significant assets, Pearsey can help them out too, as he has experience in wealth management.
“We use traditional and alternative assets to reduce their taxes and reduce their exposure to the downside of market risk,” says Pearsey, who promises that the company can help in every area of each client’s life, as they look out for clients on multiple fronts. “We put a game plan together for everybody depending on where they are in life and what they want to accomplish, so that they can have peace of mind.”
For more information on No Worry Retirement, call 317-893-2631 or visit noworryplan.com.