Every financial product has a pro and a con. Every product has a risk at some level. What makes Wendel Retirement Planning different from every other plain vanilla financial advisor, according to Jeff Wendel, CEO, is that they like to call their clients quarterly and semi-annually just to stay in touch with them. Jeff says they like to have their clients come in as much as they can because it’s a way to keep them informed and educated. There’s a lot of information out there, and the longer they’re away, the better chances there’ll be a lot of bad information. His team takes an unbiased view of their client’s finances and shows them the pros and cons and what they currently have. Jeff talks about the Wendel Total Return Fund and other products and strategies they offer that help clients get predictable income and less volatility in their portfolio.
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The Best Retirement Planning Strategies with Jeff Wendel
I have the good fortune to be interviewing Jeff Wendel of WendelRetirementPlanning.com. Jeff, thanks so much for joining us.
Seth, thanks for having me.
Let’s go back in time a little bit. How did you get started?
Back in 2001, I got my insurance license in the fall. Before that, I owned a couple of different businesses. Back in 1992 and 1994 my dad, brother, and I, we have always wanted to own a bar restaurant and we bought the local bar restaurant and we changed the name to The Ranch Tavern. We had three great years and it would have been more great years, the bar scene and restaurant scene and the late night shifts, but I got married and that changed a lot of things. I sold out my third. At that time, I worked at a local factory as an inspector for a farm implement dealer. During that time, I got itchy to do more things and own another business. A couple of years later, I got a postcard in the mail and I went to a seminar in Dayton, Ohio. They were trying to sell us vending machines.
I got excited. I bought some that day and I started another business called Five Star Vending. That started with three vending machines. I ended up with 45 of them in four years. On our fifth year, we had $250 million in sales and then I sold it because I started getting into the financial service industry. I’ve always enjoyed coaching. I’d coached a lot of youth sports mainly baseball. I’ve done basketball and football also, but I enjoy coaching and helping people, having an impact on people’s lives. I enjoyed doing that with the kids I coached. I was trying to be motivational to them and make it more than just a game. I took that into my financial career. I enjoyed helping people learn more about the finances and how they can make money work for them.
That’s quite a bit of the business background in the financial services. Talk to us a little bit about Wendel Retirement Planning. What about you makes you different from every plain vanilla financial advisor? You’ve got some stuff that other advisors don’t have.
The biggest thing with our service is we like to call our clients quarterly and semi-annually just to stay in touch with them. We like to have our clients come in here as much as they can because we know that there are a lot of information out there. The longer they’re away from us, the better chances there’ll be a lot of bad information. We like to keep them informed and educated. We take a very unbiased view of their finances. We show them the pros and cons and what they currently have. Every financial product does have a pro and they have a con. Every product has a risk at some level.
We don’t take the approach where we say this product is really bad, don’t do it, or this is product is great. Let’s take a look at what you have. Let’s look at the pros and cons. If that’s what you want, that’s great that you have it, but if you don’t want that, we may offer you something different. The products we offer, the strategies, we understand how retiree have one or more predictable income and retirement and less volatility. The strategy that we offer helps them get a predictable income and less volatility in our portfolio.
I’m not a retired person, but I would think if I was, predictable income and less volatility are exactly what I’d be looking for.
The biggest thing that we stress people with is called sequence-of-returns. I hold different classes at universities in our area. We teach them financial planning concepts and required minimum distribution at educational events. In sequence-of-returns, no matter what sequence-of-returns come in, when you’re not drawing income, it really doesn’t matter but whenever you start drawing income, the ballgame changes. If you have your first couple of years in retirement withdrawal income and the market tanks and you’re in the market, you will dramatically cripple your retirement and you’ll never recover from it. We’ve seen that in a downturn and it’s going to happen again. We don’t know when, we have no crystal ball, but we’re at an all-time high now and eventually something bad is going to happen.
When you talk about sequence-of-returns that matters, it’s not the average that matters. It’s the order in which each year it goes up or down that affects your portfolio and your nest egg the most, is that right?
Absolutely, correct. You started out with a positive 28 and you go to negative 38. Then you flip those around and the same thing happens. You’ll get the same result at the end, but when you start taking an income and the same sequence-of-returns happens and you flip it around in your first couple of years are negatives, that’s when your retirement will be crippled.
If you were pulling money out while the market was going down, that’ll deplete your nest egg really fast.
You’re losing money because of the downturn in the market and also taking money out. I have never seen portfolio recover from that ever.
You’ve come up with a unique solution for that. What is the Wendel Total Return Fund?
We did a lot of research. I used to sell a lot of mutual funds in my younger days, 2002 to 2009. One thing I realized was the fact that it seemed like in my personal accounts and my client’s accounts, we take one step forward and two backwards. We never get ahead and me as an advisor, I got paid every day, but my clients did not. It was not a two-way street. A good business deal is when both sides make money, not one-sided. In my own conscience, I could not continue to operate that way. After the 2008, 2009 market crash we had, I went through a couple of years where I’ll either going to get out of business and do something different because I wasn’t helping people. We lost some money in those downturns through mutual funds but I did a lot of research.A good business deal is when both sides make money. Click To Tweet
I came across a study from Yale and Harvard were their endowment fund is some of the biggest ones in the world. They used to have a 60/40 asset allocation mix like most people do. They had the same problem. They were not making very good money, if at all. What they did, they hired some new managers, got some new ideas, and they brought in alternative investment that was private equity and real estate. That became 60 to 70% of their portfolio and because of that, they started making quite a bit more on their returns. I started digging deeper, how they’ve gotten those types of programs and how I can bring that to my clients? Luckily, through my research and due diligence, we found some good companies that we can bring private equity and real estate to my clients and help them get a stabilized portfolio.
I love that you didn’t do what so many people in the industry do which is just say, “That’s just the way it is.” You had a moral compass that said, “I don’t feel good. I’m still profiting even if my clients are losing.” You went and found another solution. What is the Wendel Total Return Fund?
It is a fund in which my clients participate in and we acquire medical buildings across United States, kidney dialysis centers. They have a fifteen-year lease on them, usually through a sign by DaVita or other Fortune 500 companies. By doing that, they use my fund and client’s money to purchase those buildings. You get an equity share in that fund, pro-rata, the way you put into it. By that, you get paid dividends on a monthly basis. Therefore, that helps out with your returns because you took in 5% to 12% of dividends.
The Wendel Total Return Fund ends up investing investors’ money in a program that buys, in this case, kidney dialysis centers around the country. You’re the landlord. The kidney dialysis company like DaVita or Fresenius is then paying you rent and their share of profits from that is the 5% to 12% interest dividends.
The neat thing about it is the fact that my clients are getting involved with real estate without having to collect the rent or be a landlord. The big thing with private equity, they need this money to purchase those buildings so my clients get rewarded for that.
5% to 12% is a heck of a lot better. It blows away anything. Banks are crowing and celebrating and advertising if they’re paying 1% for a year or to a CD. 5% to 12% is a heck of a lot better.
Retirees like it because it helps them with their income plan.
If I have $1,000,000 in the bank and I’m getting 1% of my CD and I’m not doing very well, but if I’m getting 5% to 12%, you can live on that.
It’s all about changing lives and doing the right thing for people. Seth, we live in a small town of Fort Recovery, one stoplight, 1,300 people. Talking about the moral compass before, it’s all about doing the right thing every day and continue doing that. The more right things you do, the better it helps everybody.
The returns are what’s attractive, but you’re investing in kidney dialysis centers. That’s a huge growing market. There are almost three-quarters of a million people on dialysis every year and you can’t live without it. Either you have dialysis or you get a kidney transplant. If you don’t get a kidney transplant and you don’t do dialysis, I think you die. It’s necessary to sustain life if you’ve got those kidney issues. I’m not a doctor, I don’t play one on TV.
No doubt a kidney transplant maybe better in most situations, but they’re not always available. It came to us as something that they need to continue to help themselves get better.
It keeps people alive and you’re literally saving lives. Your investors are literally saving lives and getting paid well for it. They’re doing well by doing good.
That’s one way to put it. Definitely, we’re adding benefit to what we’re doing. There are more opportunities for people to get better.
You mentioned retirees wanting predictable income and less volatility. If you’ve got a never-ending flow of kidney dialysis patients coming to kidney dialysis and their insurance is paying for it, then that would mean the kidney dialysis centers are locked to pay their rent every month to you. I would imagine that’s a heck of a lot more reliable than the stock market and a lot more stable.
As I said it was one of those deals where it does serve a purpose and it does benefit a lot of people.The great thing is we didn't just have our kids to get better, we have other kids get better. Click To Tweet
You’ve put together an investors’ white paper for accredited investors who want to learn more about the Wendel Total Return Fund and how they can make money by saving lives at the same time. Where can our audience go to get that?
They can go to our website at WendelRetirementPlanning.com/whitepaper.
That offering is for accredited investors. If you are one and you’re interested, please go check it out. I know you have a big passion for baseball. Tell me a little bit about that.
I love baseball. When we were younger, at home we played baseball on the front yard. We live so far out of town and dad and mom supported us playing high school sports and something I wish I could have done, but you can’t turn back time. I was suddenly leaving town and having children. They play everything they want. I’m barely 5’9” and I know that my kids probably won’t be dunking a basketball anytime soon. I told them, “I think baseball’s the way to go.” Sure enough, I went to a lot of camps. I learned a lot of hitting systems and throwing systems and I did a lot of networking with people that know what they’re doing. By doing that we get a lot of programs for kids here in Fort Recovery. My oldest son was fortunate to make the OH League a couple years in a row then also play on a State team that went to the final four first time in school history since 1953. Then my other son, Cade, he’d been there twice. I got a lot of great tradition but the great thing is we didn’t just have our kids to get better, we have other kids get better.
We appreciate the time you spent with us. We’ve been here with Jeff Wendel. Thank you so much.
Thanks for having me, Seth.
- Wendel Total Return Fund
About Jeff Wendel
As a financial professional, I am committed to helping people just like you create solutions for their retirement assets. Once I understand your risk tolerance, time horizon, and goals, I’ll work diligently to develop a program that carefully balances earnings strategies with preserving principal. Today’s economic environment brings challenges. But along with challenges come opportunities and potential rewards. I work closely with my clients to evaluate those opportunities and to help them get in a position to reap those rewards. I enjoy helping people build a solid financial foundation for the future.