A conversation with Stan Webb

04/22/2012 5:00 AM

08/08/2014 10:09 AM

Stan Webb likes to give free financial advice.

A professional financial adviser, he believes in improving financial literacy in the community. That’s why he spearheaded the creation of Money Smart Week, a series of free financial education sessions being offered this week by various local companies and nonprofit groups around the city. He will be teaching a series of workshops for seniors as part of the effort.

Information is available at www.facebook.com/wichitamoneysmartweek.

He also recently founded the nonprofit Minerva Foundation for Financial Literacy.

Webb, 58, is married to Sheila and they have three children.

Why are you so interested in financial education?

I’ve been in the business for 27 years and that lead me to the realization of the need for better financial literacy for all ages, all socio-economic standings. It really doesn’t matter who; millionaires go broke.

But haven’t people gotten smarter financially in recent decades?

Yes, but it is so much more difficult that, even though they’re smarter, there’s more complexity and strategies and the ever-changing environments, that it’s still hard to catch up with. And, believe it or not, people still make the same fundamental mistakes that they have been making for 50 or 100 years or since the beginning of money.

Like what?

Poor budgeting, overspending, bad loans.

Isn’t living within your budget pretty obvious?

You would think.

But the people I see, they will agree with me, but they don’t do it. It’s hard to stick within a budget. And every generation has a little different spending habit, and the baby boomers are the Me Generation … they want something, they will go ahead and get it now. And if something goes wrong, everything blows up.”

So financial advising means more than knowing about money?

That’s what makes my job very difficult. I may ask 100 questions before I’m ready to give any advice because I have to know why they have made the decision they have made, not just the fact that they’ve made it. That tells me a lot about the person, their make-up, their tolerance for risk, their approach to savings, their family structure, their relationships and how they manage money in their own household. Those things are lot more important than the investments they buy.

With the Internet you learn a lot of things about investments, but without that foundation of why those things happened and the desire to change bad habits, things never change. That’s why inheritance is typically spent within nine months of an heir getting it.

What other mistakes do people make?

Thinking they are smarter than their information. Many times people are searching for information that agrees with what they already thought they wanted to do, rather than the best way to handle it. That goes back to psychology.

So a third party is helpful?

I’m just honest with them. I can be that rose, or that thorn in their side.

How much do you need to save for retirement?

How much you need depends on how much you’re going to spend and nobody knows that. … Somewhere between 4 and 6 percent is the rule of thumb, but that depends on the rate of return you get on your investments and how much savings you have set aside to handle the emergencies that arise as you get older.

How has your advice for retirees changed in recent years?

You have to be more self-reliant. No matter what the government subsidy is – and Social Security is a subsidy … we get more out of it than we put in if we live long enough – we need to be more self-reliant, more diversified whether its Medicare, Medicaid. …You don’t want to have to survive on Social Security, unless that’s the lifestyle you’re used to.

How serious is inadequate financial education among seniors?

The fact that fraud and financial crimes are most common against seniors is a good indication that they are they are not making good decisions.

Why?

Trust. The older generation is much more trusting and believing what everybody says. You can’t do that. You have to be a little bit smarter.

What’s the most common problem for seniors?

A big area of concerns, as their health deteriorates, is family financial abuse as somebody else takes over their finances.

What else?

Many seniors are what I consider to be going broke safely. … They are losing purchasing power. They’re not thinking 20 years ahead.

Tell me about your new education nonprofit, the Minerva Foundation?

The Minerva Foundation is primarily for better education of kids, and for helping women in financial crisis.

For that we do an all day seminar and bring in local experts and have a lunch-and- learn with break-out sessions with four or five different professionals from psychologists to a banker to other things to give women the foundation to get back on their feet. …We’re just now putting the word out about it.”

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