Photograph by Ben Rollins
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Wes Moss, a managing partner at Capital Investment Advisors in Atlanta, insists that if you haven’t seen the light at the end of your career tunnel yet, you need to take a second look. Most investors can retire earlier than they think, even in today’s uncertain times, says Moss, the author of three personal-finance books and host of the Money Matters weekly radio call-in show. His firm manages about $3 billion for clients with wealth ranging from $1 million to $5 million.
Barron’s: Are there certain criteria investors should meet to retire early?
Wes Moss: They should have a certain liquid asset level, a mostly paid-off mortgage, and multiple streams of income. But if you have several years until a pension kicks in, or it’s too early to tap assets, you have an important financial-planning arrow in your quiver: going from a full-time high-earning job into what I call the retirement gray zone where you downshift your job, but still make enough to avoid dipping into savings.
What are your clients’ biggest concerns?
The focus has shifted to the election. People are very nervous about tax rates. We have clients on both sides, but there is more nervousness among conservatives. I remind my clients and listeners that the economy is made up of millions of hardworking people and no matter who is in the White House, they still have the same motivation to grow their business. Regardless, the economy is going to move forward.
What’s your stock market outlook, and what tactical allocations are you recommending?
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If Hollywood were filming a movie about the stock market, it would be Rocky 9 played by dividend-paying stocks—they still have a comeback ahead of them.
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We still believe that U.S. equities are best in class relative to the rest of the world, and an economic rebound in the U.S. during 2021 could surprise to the upside. The gargantuan tech companies have led the market, and the average company has still struggled. We are now scaling back on technology companies relative to normal times.
What stocks are you favoring?
We think there’s more upside in income-paying stocks in other sectors. If you look at financials, energy, utilities, and real estate, very few of those companies have hit new highs. If Hollywood were filming a movie about the stock market, it would be Rocky 9 played by dividend-paying stocks—they still have a comeback ahead of them.
What is your portfolio ballast for clients who are more risk averse?
Where I see ballast and safety is through the generation of income. If I know I’m going to get 2.5% to 3% from equities, 5% to 6% from alternative income, and 2% to 4% on fixed income, that is the ballast.
What’s unique about your approach?
I focus on the softer side of things—helping people find happiness in retirement. I’m a giant proponent of retiring with core pursuits. These are hobbies on steroids, things we look forward to. Learning an instrument. Learning a language. Golf, biking, yoga, walking, hiking. I had Georgia Tech do a statistical analysis and found that happy retirees have 3.6 core pursuits. Unhappy retirees have 1.9 core pursuits.
Thanks, Wes.
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