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Sept. 12, 2021

59. What DIY Investors Need to Succeed with Brendan Lee Young

59. What DIY Investors Need to Succeed with Brendan Lee Young

Join Mike Cavaggioni and Brendan Lee Young on the 59th episode of the Average Joe Finances Podcast as they talk about what DIY investors need to succeed. Brendan is the CEO and co-founder of Passiv, a portfolio management tool designed to help self-directed investors manage and grow their wealth. At Passiv, they believe that our money should work hard for us and not the other way around. And so, Passiv allows investors to easily manage their portfolios by automatically calculating trades and bringing their portfolio back on track with just one click. Today, Brendan shares experience building the software and working with DIY investors on the platform.

In this episode, you’ll learn:

● The benefits of managing your own portfolio as a self-directed investor

● The importance of being “financially woke” before using Passiv to manage your portfolio

● What other premium features Passiv provides under their yearly flat-fee subscription

● Why you should focus your allocations on index funds as opposed to speculative bets.

● How you can get started as a DIY investor with the help of Passiv and their team

● And much more!

About Brendan Lee Young:

Brendan Lee Young is originally from Trinidad and Tobago, a small twin-island in the Caribbean. He migrated to Canada to become an entrepreneur, which stemmed from his passion for financial independence. Brendan worked in the tech industry for a few years to learn how large tech corporations run. And eventually, he co-created Passiv, a portfolio management tool for online brokers, with Brendan Wood. 

The idea of Passiv came about soon after Young and Wood met. They discovered they were both disillusioned with the status quo of investing: paying high fees for active management of investment products, with nothing to show for it. Then again, even when they turned to passive investing, the Brendans found there were still tedious aspects to managing their investments. 

And so, Young and Wood decided to build a tool to free them from monotonous tasks, a tool that automatically calculates the trades needed to keep a portfolio close to its target allocation. After that, they soon realized that other investors would benefit from this tool, so Passiv was born. Since then, their team has grown, and hundreds of Canadians manage their money with Passiv, saving on management fees and spending less time with Excel.

Find Brendan Lee Young on: 

Website: https://passiv.com/

LinkedIn: https://www.linkedin.com/in/brendanleeyoung/

Facebook: https://www.facebook.com/TeamPassiv/

Twitter: https://twitter.com/brendanleeyoung

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Transcript
Average Joe Finances:

This is Average Joe Finances podcast, Episode 59. If you're watching this on YouTube, make sure you smash that like button and click subscribe. For those of you listening on a podcast platform, be sure to subscribe on whatever platform that is, and leave us a rating if you can. The more likes ratings and subscriptions that we get, the more we can spread the message and grow our community. So we also have a free Facebook group. It's called the Average Joe Finances network. Check us out, join the group, join the community, ask questions, and become a part of the team. All of our other social media accounts are listed in our flow page. And we have them in the video or podcast description below.

Brendan Lee Young:

Don't speculate. Stick to investment plan. If you are going to speculate do it with money you can afford to lose And better yet it shouldn't be money that was part of your your your contributions.

Average Joe Finances:

Welcome to the Average Joe Finances podcast. Are you trying to get out of debt, invest or just not sure where to start? Then this is the place for you. We discussed different ways to get out of the rat race and build your wealth. Join us on this wild ride to financial freedom. Hey, how's it going, everybody? So today's guest is Brandon Lee Young, and he's the co founder of passive, a portfolio management tool that's designed to help self directed investors manage and grow their wealth. Users can build their own personalized indexes, Robo advisory services and that be their households. Asset Manager passive manages over 20,000 accounts on their platform. And it's helping people manage over $1 billion in assets. Background wise Brandon is originally from Trinidad and Tobago, a small twin island in the Caribbean. He migrated to Canada with the goal of becoming an entrepreneur. He worked in tech for a few years to learn how large tech organizations were run. His interest in entrepreneurship stemmed from being passionate about attaining financial independence. And this is what led him to founding a fin tech company. So as you may all know, I've interviewed somebody else from passive Nick McCollum in the past and it was an awesome interview. I'm really excited to talk with one of the co founders of this company, and dig a little more into the to the weeds. So, Brandon, welcome to the show. I'm excited to have you.

Brendan Lee Young:

Hey, thanks so much for having me on, Mike, really looking forward to chatting with you and your audience and, you know, rapping about whatever we got to rap about today. Alright, sounds good.

Average Joe Finances:

I'm not the best rapper. But you know, I'll give it a try. I might be able to give you a beat, like a boombox a little bit, you know? But we'll save that for another time. But hey, can you tell us a little bit more about yourself? Like, besides the background that I just gave on you, can you you know, share your story?

Brendan Lee Young:

Yeah, so I guess my story began, like, like years ago, ensure that so I, I always wanted to basically live abroad, my idea was like, buy a house in North America, and then rent it out and live off of the money that I'm getting paid back in the Caribbean because of basically doing geo arbitrage. And because of the exchange rates. And so that was like sort of my plan, I'd work in tech, get a nice cushy job, buy maybe an apartment building, and then, you know, rent it out and, and make and live off of the rental fees minus whatever, I beat a property manager. that's easier said than done. So anyway, that's sort of like, what got me into like, investing because I realized that I could, I could also just buy stocks and live off the dividend payments. And so that rabbit hole got me interested into fire, because basically, you know, that's sort of what the movement does, right? You You live off of you live off a dividend payments, you save a big cushy nest egg, and you sort of just enjoy life. And so yeah, that's sort of like how I got into DIY investing. Um, no, so funny stories, like so. So at university, there was this course called value investing. And so I thought that maybe not only could I find dividend stocks, but undervalued stocks that would appreciate. It turned out the data was also easier said than done, because you got to spend a lot of time doing fundamental analysis on companies and it it's basically a full time job finding undervalued companies, and not only are you spending time doing the research, but you're using models and spreadsheets that you've got to tweak and up to keep keep up to date. And it just, it just wasn't for me in the end. So when I graduated, I just worked in tech and followed a simple index, a tree fund index portfolio, and, you know, I basically use that but even then that became really problematic because The fact that I had to use the same spreadsheets again and although to a lesser extent it's still meant that I had to keep my spreadsheet up to date hide from my boss on a Friday afternoon to place trades at my brokerage just the just the balance is simple tree fund eats ETF portfolio and so I'm not sort of sad to say it bluntly. That that that's what really led us to found in passive myself and my co founder Brendan wood, he also was doing the same thing. And him and I were chatting one day, and we're lamenting about having this sort of problem. And I'm not even though I worked in tech, I'm not a developer, I'm more worked in customer success. And so when he told me he could build this thing that would help us automate our portfolio and in fact, that sort of got me sort of like curious and blah, blah, blah address this issue went on to found passiv so yeah,

Average Joe Finances:

alright, so you you immigrated here from the Caribbean, right? And okay, actually, first off is a Caribbean or Caribbean, the islands mine. I live on islands. I live on an island right now, too. So yeah,

Brendan Lee Young:

yeah. Wha hoo. Oh, no, you can you can say Caribbean. Caribbean? I never thought about it. Uh, yeah. I guess it depends on the accent. But yeah, we just say the Caribbean. Alright, sounds good.

Average Joe Finances:

Alright, so you immigrated to Canada and your your whole thing is you wanted to be an entrepreneur, and you want to do your own thing. So you started going to school, right? When you went to university, and you were trying to figure out how to do this. And the the biggest thing, you notice that the invest in any type of portfolio, it took a lot of research, and that research takes a lot of time, right? And you realize that you didn't just have like this insane amount of time to be able to do this research. So you guys put together this, you know, this website, or this, or this tech company called passive? Right? And from what I understand, from what I know of it from the last time I talked to Nick, you know it, it balances your portfolio for you. So can we can we talk about that a little bit? Like how, how does somebody that is trying to, you know, they're they're a DIY person, and they want to manage their own portfolio? How does this benefit them?

Brendan Lee Young:

Yeah, so like, basically, you don't have to use a spreadsheet, right. So like, if you're following a portfolio that consists of international equities, Canadian equities and bonds, and you want to keep it all balanced, then you you're you're using a spreadsheet to basically help you calculate the trades you need to place based on the money you're allocating every month. And so like folks in the fire movement, I'll use them as an example because like, presumably, you're, you're saving as much money as possible every month. And so every time you got to allocate cash, what are you gonna do, you're gonna have to break open your spreadsheet and input data to figure out well, how many trades of ETF one I need to buy to keep my portfolio balanced. And so basically, the benefits of passive is really saving you time, but also giving you that ability to click a button and have your money invested against the target portfolio trying to follow. And so that's really the main benefit I like, like basically imagine like not never having to log into your broker and navigate to all of those pains, just the place to trade, right, like you've got to tap into trade in key in the, the assets you want to place put into number of shares, if you're using a market order a limit order, like there's a lot of friction that goes involved, just just that that's involved in balancing your portfolio, just placing a trade. So like, what we do is we just make it super simple that someone can click a button, have their cash allocated to their target portfolio, or have your portfolio rebalance. But like what I really, really think about passive that's cool is that someone that's just getting started has an option they can be not an option as a stock option, but an option to invest on their own and save on all the fees that you typically pay. It's an asset manager. So like in Canada, we pay about 2% a 2% management fee on mutual funds and like that's wild right? Like if if you think about it, right like that's a lot of money and that money could be used to help your money grow or you know, hit help you hit your your, your fire number fastest,

Average Joe Finances:

especially over a long period of time, too. It's gonna add up,

Brendan Lee Young:

man, it compounds it adds up and like, you don't you don't even have that control and sovereignty over your money because you're giving it to some some some fat cat that really rich half were you in like it anyway just didn't sit well for me. So what I like about passive is that it, it helps the folks that are already doing DIY investing to do it. But it also makes it easier so that younger folks, or folks that want to take control of their finances can do it and save a ton of money if they want to. And so like, like, I like robo advisors, I think they're great, they're certainly cheaper than mutual funds here in Canada. But the thing that I've always had a hard time scraping up is, am I going to pay a percentage of my net worth and algorithm just balanced my portfolio to meet up for me, it just didn't seem like an option. And so I just, I just wouldn't do it. But that's where I think passive comes in. Because if you are someone that knows what you want to invest in, you are fee conscious. And if, if you want to, like invest for the long haul, you can just use passive and you're not paying a scale and fee and you still get that functionality, as you would if you were with a robo advisor. Of course, the big difference is you've we don't tell you what to invest in and help you with asset allocation. Like you've got to be a bit of financially woke to use passive and so I think we're solving a pain for folks that are more financially work and want to be more involved in in their in their investments, but not necessarily do those tedious things that you would do using a spreadsheet to help you keep stuff out.

Average Joe Finances:

Right? Yeah, I like how you put that like financially woke, right? Because it's not like you know, somebody who's never invested before, this is probably not the best thing for you to use. you need you need to learn what you're doing. First learn what kind of assets you want to be in, you know, what, what type of, you know, do you want growth? Do you want, you know, recurring dividend payments, you need to figure out what is it that you know, you want to invest in. So passive is there for the folks that, you know, I'd have a good grasp of what they're doing with their investments. But it makes it simple, because you know what your plan is, right? And it sounds like all you got to do is click one button, and it rebalances your portfolio for you to right, you know, right where you needed to be for your target.

Brendan Lee Young:

Yeah, and so like, what's what's also cool is that, like, you could be a family's asset manager, so like, my co founder, who's also named Brandon. So like, he had like, six accounts that he's, he's, he's managing, right, so if you think my, my spreadsheets complicated, his spreadsheet would have been off the chains just because of the amount of accounts and assets that are in them. And so what what passive allowed him to do was just like, combine all of those accounts into one holistic portfolio, and balanced across all of them. Or you could take each of those accounts that you have, and then create separate portfolios with different asset allocations. And the best part is, is again, you're not paying a fee, you're seeing everything in one spot, you're clicking a button and, and having passive do that thing for you. And so it's, it's really empowering from that point of view. And, yeah, it's, it's really helpful for folks that are really, like I said, really in tune with their family's finances. And we even have an older user I say, older not to be derogatory or anything like that. But like, someone that's, that's a bit like, basically is in retirement. And so she reached out to the team, and she's like, I have some questions, I'd like someone to speak to me. And so when, when, when her and I hopped on the phone, we found out that this person was in retirement period about passive, and they, they wanted to use passive to help them balance. So I thought that was pretty cool. Because, you know, like someone, most people say, oh, investing is hard. And, you know, if you if you don't know, anybody should give it to a professional, but but this this lady, she understood what we were doing, and she just clicked that button. She's I love your service, man. Like, you're helping me a lot. I was like, that's awesome. You know, like, please reach out. So yeah, like, no,

Average Joe Finances:

that's, that's awesome. Because like, when somebody when someone's in retirement now and and they're, they're relying on what they have invested to live off of. Right. So it's important that, you know, the the service that you all are providing makes it that much easier for her that it's just with the click of a button. She, you know, she rebalances her portfolio. So where she's comfortable in retirement, right.

Brendan Lee Young:

Yeah. And I think I think that like I see it on the other side, too, because like I have this friend that so he was invested in with a popular robo advisor here in Canada. And so he got the bright idea to take his robo advisors model portfolio, and basically replicated by opening a brokerage accounts and using passive and so he was doing it for some time and he sends me an email saying, Man, I really like Passive but, but I'm trying to understand like, like, why your performance is different? What I'm what I'm seeing at my robo advisor like, Why Why is it that, that the numbers even though we have the same portfolio, like I have the same portfolio, but my robo advisor and passive like, like, why is there a difference in the two in the amounts? I'm like, well, friend, um, it's because you're saving on defeat that you wouldn't be paying to robo advisor. Um, and he was like, Oh,

Average Joe Finances:

yeah, that fee like, like you said, 2%. In Canada, I mean, so compound interest goes both ways, right? If you're paying 2% on every, every time you're moving your assets around your or your, you know, your allocations. I mean, that's, that's definitely going to add up. So I just passive make money. Like, what what if you guys aren't charging a fee? What? How do you guys do it?

Brendan Lee Young:

Yeah, so we just we just charge a yearly flat fee to get access to premium features. So users who are passive elite, that's sort of what we call it, you can use our one click trades feature, it's, it's one of the most popular features you can, you can use our asset classes feature you can use, we have this new feature rebuilt, that lets you specify the accounts, you want to ask your assets to be purchased in. So it helps people do tax efficiency investing. And so basically, we just make money off of selling subscriptions, and not necessarily like holding people's assets and charging a management fee. I just want to clarify one thing, it's that robo advisors in Canada a lot cheaper than 2%. There, I believe they charge like 50 basis points plus the cost of the underlying ETF. So all in your about I think 75 basis points versus like, if you took a few low cost, low low fee ETF, like I think some of the vanguard and black one, Black Rock ones are really really dirt cheap, like, like below, below 10 basis points, you could you could build a really broadly, a really good a really cheap, broadly diversified ETF portfolio that that's going to come in under 20 basis points and not have to pay any sort of scaling fee to a financial advisor or mutual fund. So yeah, I just just wanted to clarify that point.

Average Joe Finances:

Yeah, for sure Yeah, so it sounds like though, where you save your money is that you know, it's it's a it's a flat fee, right? It's a flat subscription fee. It's, it's not going to vary based on you know, how much you're trading how often you're trading or anything like that, right? There's, there's no limits to how often you can you know, rebalance your portfolio or anything, right.

Brendan Lee Young:

Yeah, that's correct. It's use it as much as you want. And you can you can connect as many accounts to your, your, your passive accounts as well. So you take take, for example, someone that has, you know, they are managing their households wealth, or maybe their parents wells as well. And so you can all get them in on the one passive, you need subscription and just manage it all within passive. Oh, wow.

Average Joe Finances:

Yeah. So okay, so multiple accounts you can have in there under one passive subscription. That's, that's pretty awesome.

Brendan Lee Young:

Yeah, yeah. It's pretty cool. So like, I I use my my mom's brokerage accounts, I manage my wife's brokerage accounts, and my, my brokerage accounts. And so my, my passive dashboard looks like insanely long, because of all of the accounts that I have. And I think, I think there's like one, one person on all thought for him, he's like, managing, like, maybe 2020 accounts. And like, that's, that's, that's kind of interesting.

Average Joe Finances:

Now, for all those accounts, are they? Can you allocate them differently? Or do they all have to be like the same kind of asset allocation?

Brendan Lee Young:

Oh, no, you can you can, you can, like, let's say, I had Mike's, if Mike, if I had your accountant, my passive dashboard, I can give you an 8020 asset allocation to view on a Vanguard bond ETF, and I can do a different one for my accounts as well. So it's really

Average Joe Finances:

wow, that's okay. That's even better than I thought. Because I thought, you know, it's like, oh, everybody be under the same plan. So whenever you, you know, you rebalance or anything like that, everybody goes back to the same and it's not, you know, okay, that's, that's good that everybody can be different, based, based off of, you know, like, so, you manage it, you said for your mother and your wife, right. So, if your mother wants to do something a little bit different than what you're doing. She doesn't have to worry about every time you go to rebalance the portfolio that it's going to move her stuff to look like yours. That's correct. And investing a little more riskier than she is right because you're younger. And she you know, usually as you get older, you're a little more risk adverse.

Brendan Lee Young:

Yeah, so my mom's it's interesting. My Mom, she's all about taking that risk. And so like the way the way she looks at it is like I will inherit whatever she has. And so if it's about building intergenerational wealth, then why have a portfolio that's super, super conservative, that wouldn't really earn much. So yeah, she's she's, she's like, well, let's, let's take some risk and see where that goes. No, that's, that's great. That's, that's awesome, man.

Average Joe Finances:

Okay, so we're talking a lot about passive and what did you guys do? And it's, it's fantastic. I'm learning a little bit more like this is stuff I didn't really talk to Nick too much about, like, we kind of went over like wave top stuff. So this is a little more in depth. I'm having fun with this. And it's pretty exciting. But you so let's, let's talk about Brendan Lee Young here for a second, right. And so Brendan, what is it that you know, you personally are doing on your journey to or in financial freedom, because we've, you brought this up a couple times now, right? The word financial independence, and actually even the fire movement, financial independence, retire early, I'm actually wearing that shirt. Maybe that's why I'm talking about it, because I'm seeing Oh, yeah, but so what is it that you're doing like in your own investing and like your own strategy to get yourself to financial independence, Let's take a brief moment to hear from our show sponsors. What's going on everybody. So today, I want to talk to you about the podcast editing service that we use for the Average Joe Finances podcast, that is editpods.com. And what I really like about them is it's a subscription based service. So the prices are fantastic. And not only do they do the podcast episodes for us, but they also make us videos, audiograms, social media captioned videos, they do our show notes, thumbnails, it's just fantastic products. Go check them out at editpods.com What's going on everybody. So today, I want to talk to you about buzzsprout. The Average Joe Finances podcast recently switched over to buzzsprout. And I gotta say, I am super happy with the progress. Our podcast is now on every single major platform, and reaching audiences that we couldn't reach before, which is just super awesome. So thank you to buzzsprout for being such a great platform. But also I want to say, Hey, guys, if you sign up for buzzsprout, and you sign up for their paid plans, using our link, you'll get a $20 amazon gift card. So go check them out. It's AverageJoefinances.com/buzzsprout. And we'll make sure the link is in the show notes below. Let's get back to today's episode. You're listening to the Average Joe Finances podcast, whether it's single or multifamily real estate, the stock market or side hustles we discuss it all strap in and enjoy the ride.

Brendan Lee Young:

You know what I have to be honest with you, I'm prone to to chasing shiny objects. So for me, it's all about sticking to that plan that I've got, like, for example, like GameStop, like, you know, I was I was I was tempted to get in Bitcoin, like I hope speculatively. But that's just fear of missing out. But I'm like playing with money that I don't mind losing or speculate, speculating with the large majority of my, my, my assets are in index funds. And so I, I continuously contribute to my, my portfolio, but if I save extra money, I, instead of like dumping it into the index fund, I take some money allocated into speculative bets. So I sort of like forced myself to say, okay, Brandon, if you want to make a speculative bet, then you got to pay to have the right to make that speculative bet. So I would cut my spending in a certain area, like maybe I wouldn't go out for a bit. For the past year, that wasn't a problem, because we were all like, locked down under COVID. Right. So I saved a lot of money. And I had money. And so I just allocated it into a few speculative bets. And so I yes, I invested in GameStop I lost Yeah, I lost I thought I thought we were going to the moon and I ended up holding the bag. I did invest in Bitcoin, and aetherium. So, you know, I'm seeing those things as more long term speculative holdings that Yeah, could be interested in. So like, I don't really care if it goes down or up, but to, to really, really speak to it if I had to summarize it is have a plan stick to it. If you're gonna speculate, don't speculate with the money that you're trying to save towards your plan, like find that money in some sort of a side pocket, you know, like you You sort of like, save extra for by not spending and then you can maybe use that money for your speculative stuff, although like some would argue well, why don't you just contribute it to your index fund, which probably you should do too. But like, I just I just like to speculate It's a bit more and so I'm fine with with whatever I lost. But the point is, is just stick to your plan and don't like deviate or gamble with stuff that you know you can't afford it

Average Joe Finances:

You said don't deviate or gamble. Right? But that's that's exactly what speculations are right? It's a gamble. And you said it right the first time, right? When you were saying, Oh, you know, I put these in as a bet, right? Because that's what it is what you're doing when you speculate it's a bet, and you can win big or you can lose big, right? But the thing is, is you still had your allocation set up that you know what you're going to contribute to your, your main accounts, right, your index funds, and what it is that you're saving up for retirement, right, what you're saving up for your own financial independence, you didn't take away from that you decided, Okay, if I want to speculate a little bit and put a little money into something that I'm going to bet on, this is money, you know, I'm gonna knock it out, I'm gonna, you know, take away a little bit from this a little bit from that, and you kind of reallocated your own personal funds, right to use that money towards that. And I think that's super important for anyone who's listening right now is that, you know, don't take away from whatever your current plan is, like, if you have a really good plan to get yourself financially free and financially independent, and you decide you want to start, you know, playing around a little bit with some speculations and stuff, don't deviate from your original plan. If you have some extra cash to do that with, then sure, you know, but don't deviate from what it is you're doing play it safe, which is exactly what what Brandon here was doing. So I'm just glad to hear that you didn't take away from what you would normally contribute, you know, towards your financial independence goal. And that, yeah, you know, you took away from yourself, like, you went out less and things like that. So,

Brendan Lee Young:

so, so funny story is that like, like, 50% of the time. When you when I did that, I looked at the opportunity because like, Ah, geez, I, I could have gone out. And if I risk losing this money in a speculative bet. Now it sucks. You know what, I'm gonna dump this to the index funds that I would have done anyway. So like, it was a way to trick myself because it's almost like 50% of time. Like I said, I just wouldn't make the speculative bet. And so I would end up contributing a bit more to those index funds. So it sort of was like a check for me that work because I, I know myself, so like, funny story I used to, I used to gamble a bit, I sipped a lot of blackjack. And that's sort of what really got me I know, I talked about, like, getting into real estate investing and stuff. But like, if you ever if someone has ever gambled, I hope you're not gambling anymore. But if ever you gambled, and you've seen lost a lot of money or seen someone lost a lot of money, it changes your world, once you could get out of it. And so like I did that at a young age, and it didn't help that, like I was quote, unquote, like, winning, you do mental model all the time thinking you're winning, but you really don't. So maybe I was still losing. But I watched this guy lose like $50,000 in the space of five minutes. I was like, What am I doing here? Like, why am I here on a Friday night with my buddies, this guy's losing 50 grand. And I'm like, here trying to play 550 dollar hands, right? While buddies just lost his house. And that totally, totally woke me up. And why Yeah, I just woke me up. I was like, This isn't making any sense. This is not sustainable. I got to invest in myself, I got to find a way to make income that's like true a business or to real estate. Like, it's just not sustainable. And so I don't often like to lead with it. But since we got into like, what I do for it sort of paints the picture as to why I do what I do when it looks to me, but that doesn't mean they'll work for someone else. But you got to know yourself too. And so once you know, what triggers you to do things, if you could design processes that sort of act as circuit breakers to help you either stick to your plan or not deviate from your plan. You end up doing it. So yeah,

Average Joe Finances:

yeah. So you know, what that sounds like, to me is like you had a huge mindset shift. Right? Yeah, it was kind of like an aha moment when you saw that happen. I mean, I know if I'm sitting at a table next someone I just watched him lose 50 grand, I would I would start questioning why the hell am I sitting here right now, too, you know. But the funny thing is what you said earlier, before that you were talking about how you were like, Huh, you know, some of this extra money that I set to the side for speculations. You know, I couldn't use that to go out. But you know what, I'm going to double down and put it in more of my index funds and ETFs. So it's funny because I have a play money account, right? that I use for speculations and things like that. And just as I was messing around with it, I wound up somehow, like at the point now where pretty much everything in there is a dividend paying asset that that is, you know, that stays pretty steady. And it's Like no longer in speculation, so few stocks that have invested in right now there's speculations and everything else is like a real estate investment trust or an index fund. And I'm like, oh, that this was supposed to be my play money. How did this happen? And, you know, I got to say, over the past year, it's up 30%. So I'm not gonna complain about that.

Brendan Lee Young:

You know what, though? It's easy. It was so easy in the past 12 months to be up 30%. Right, like, right, like, like, why wouldn't you speculate? And so that's the other thing. It's like, like, what I have made that money in a normal year, that wasn't a crash? Would it? Would it have been 30%? Would it have been more would have been less? Yeah, I find that interesting. But doesn't it feel good that when you when you make that sort of speculative bets, and you, you, you, sometimes you divest and you, you, you take profit, you put that back into index funds, and then you, you let the remainder just ride and see if see if it multiplies, right.

Average Joe Finances:

Let me clarify a little bit. So the 30% gain is on the safer stocks. There was some I did, I did go 100% in one stock, and I doubled my money, it was awesome. But I also really messed that one up, because I pulled out because I double my money when I shouldn't let it sit there. I even told myself, so I'm going to buy this one and hold it until it goes, I bought this particular stock at $2.02 a share, I bought about $4,000 worth it doubled, I made a little over 8000 a while a little over 4000 in profit, I cashed it out and put it in a read. And problem is three months later, that same stock that I bought at $2.02, a share went up to $68 and change that initial investment would have been worth $500,000. What I should have did was take that 4000 out that I initially invested and put that back, right I'm sorry, the 2000 I I'm sorry, it was 40. Because 2000 shares that I bought, but I should have taken that out and just let the rest sit because now I'm playing with house money. Right? And even then that would have been about 250,000. But I was like, Oh no, no, I doubled my money. I'm good, I'm happy. And I still kick myself in the in the button for that. But at the same time, I really can't complain because I doubled my money.

Brendan Lee Young:

You know what? And it's funny you said, because that's that's sort of what's happen with me a lot of times, right? Like, like, for example, I don't know, if it's one thing when you find a company that's undervalued, and you know, it's undervalued, and you buy it, and I was very easy. When the COVID crash happened, right? Like, pretty much everything was on sale. How do you know when it's the right time to sell your asset. And that's, that, to me is like a bigger, bigger problem. And that's what keeps me up at night for the speculative stuff. And, and so what I tell myself is, when I invest in something, if I think it's undervalued, there is a desired rate of return that I expect to get, and I'm happy in getting once I get it, I try not to look at the stock again, because you always think Who woulda shoulda coulda Why didn't die. And basically, I feel good note, like you said, I feel good knowing that I get the return that I want to get I dumped my money back into my index funds, and I go about my day. And that stock as far as I'm concerned is dead to me. So yeah, it's interesting, funny, funny story, right? So like, we I'm gonna tie this back to positive a bit. So like I said, I invest primarily in index funds, but I do a lot of when I when I say speculative stock picks, I should clarify me like, I buy individual stocks that I plan on holding for a long term. And so so Disney was one of them. So like, I bought Disney a very, very long time ago, and I held it. And the thing that was I was running into it passive as the passive was always trying to tell me to sell Disney when I was trying to do a full rebalance. And so I was like, geez, I wish I wish I could just exclude Disney from my target portfolio because like I even know I want to follow indexes this this speculative stuff that I'm going to buy and so my my co founder and I we had this, this back and forth debates. He was like, Oh, no, you're not you're not truly passive. Because you're you're holding Disney and I'm like really? like am I am I am I am I not passive? I'm buying and I'm holding this thing. I just don't want to sell it. And so then when I had a debate, we didn't do anything. And then about a month later use the census a really nasty email. Like I love your platform, but it sucks and here's why you keep telling me to sell stock ABC because it's, it's it's it's not part of my target and I don't want to sell it. And so basically that user is what tipped the scale. What's up my co founders saying like, you know what, Brian, I think you're right, maybe we should build this feature that lets us as exclude this speculative stock picks from their target portfolios. And so what I love about passive is that I could follow my passive strategy. But I could also use it and not have that factor in all those speculative things that I also hold in my accounts as well, because like, I didn't want to open a separate account just for speculative stocks, I want to keep it in the same account. And so anyway, yeah, it's it's funny you say that, because what I've learned over these past years is the DIY investing is almost like a spectrum. And you start with indexes, and, or maybe even just savings and like giving your money to someone. And the full end of the spectrum might be like, hardcore options, day trading. And the way I see passive is that we should help people get to that point of the spectrum where they're not doing active day trading, and helping them just keep their their portfolios balanced. And, and so anyway, that's sort of what we've learned. In the past four years that we've been around is that like, like, we've we've had to have really hard conversations about how we help people carry out the investing strategies, what strategies we will and will not support. And that's why passive does not support options. So like, if, if you're used any holding a few options contracts, when you import your portfolio into passive, we excluded right away. And it's not that we don't like options, it's just it goes against the ethos behind why we created passive. And so we excluded we allow users to exclude stocks. And so they could still use passive just if wouldn't balance their options are factored in. Right on

Average Joe Finances:

and now the users can can choose that, right? When they import their account, they can say, Okay, I want this excluded, and this excluded, and no issues there.

Brendan Lee Young:

Yeah, exactly. And some, some some assets are just excluded by default, just because you you can't like easily trade them like mutual funds and, and warrants and that sort of stuff. we exclude automatically. Okay, okay. Right

Average Joe Finances:

on. So there was this epic battle, the Brandon's had that one user come in? And guess what, Brandon one? Who would have thought that Brandon would have won that battle?

Brendan Lee Young:

Well, well, you know, what the funny story is, is that that's I think that's how you're supposed to do product development. I think at the end of the day, I understand. And from this same experience that's sort of like stayed with us throughout these years is that what we've learned is it doesn't matter what we think it matters what users think and want. And so we need to listen to our users. And so that's sort of what we tried to do with passive in terms of improvements. And every year, we email users, asking them for feedback, and we listened, we listened a lot. We are where we are today. Because of that, that focused on what users want. And I'm really happy to say that, you know, we're helping people build wealth and given them that confidence, because let's face it, like, if you're just starting out, DIY investing could be a bit intimidating, because you've got to do that legwork to figure out what you're going to invest in what your target asset allocation is going to be like, and then you sort of like stumble into another problem you don't even know you're gonna have when you realize, like, holy cow, I've got to use a spreadsheet to help me keep track of things and rebalance. Like, why am I doing this. And so that's what I love about passive is that we were just making it easier for people to build and grow wealth on their own terms, using their money, carrying out their passiv investing strategy.

Average Joe Finances:

Yeah, that's, that's awesome in the fact that, you know, you take user feedback seriously enough to implement changes, you know, in your system. I know, that's got to be a lot of hard work, especially when you have, you know, everything, like the code written out a certain way, like when you build these programs, it's not easy to just go in there and change something like that. So to take user feedback and really, you know, make significant changes to how you do things based off of that shows how much you care about the, you know, your clients and how you take care of them. So that's awesome, man. So you had mentioned earlier that you also invest in real estate. So what what kind of real estate Do you invest in?

Brendan Lee Young:

I invest in REITs. I my, my thesis was the

Average Joe Finances:

Its still real estate investment A lot of people don't like think about it like that, but it really is.

Brendan Lee Young:

Yeah, it goes back to the comments I made earlier on like I thought buying an apartment building was the way to go I could I could get someone to manage it and I could live back who mentioned that and and live off of the the income from it, but that's a lot of work. versus buying a REIT and getting the payments from that REIT. So that's sort of what I decided to do.

Average Joe Finances:

Yeah, well, the only thing though, so people listening, understand like if you buy a read you're not getting Getting into the benefits of owning real estate. So like the tax write offs and things Oh, no, no. Yeah, again, but yeah, so I'm invested in a couple REITs too. But yeah, so Okay, cool.

Brendan Lee Young:

And you're also not getting the hassle of chasing people for rent for property management, if you sell if you sell your your your property, you're not paying capital gains tax, depending on the account that you're holding your reason. taxes, you got to pay taxes every year, to actually taxes was a big drawback for me saying shut it down. We don't pay property taxes. Really? Yeah. So like, I had this, this sort of notion that I could just live in Canada and, and like, rent on my place. And then I realized, Oh, geez, I've got to pay property taxes here in Canada, and they're pretty high. So yeah, anyway, that's sort of those. Those are the reasons why I chose REITs.

Average Joe Finances:

Okay. Yeah, right, on Good, good reasons. You know, every everybody has their reason for why they invest the way they do, and they have their own strategy. The important thing is that whatever your strategy is, that you're doing something that works for you. And it's something you're comfortable doing, don't just get into something, because you think that's what everybody else is doing. So that's kind of my take on like, when you're when you're DIY investors, you know, figure out what what makes you comfortable, if you want to follow other people's portfolios and stuff. If it's somebody that you trust and respect or whatever, and you want to do that, then by all means, go forward, it's your choice. But make sure you're you're the one actively making a decision on you know, how you want to do it.

Brendan Lee Young:

Yeah, that's also interesting, too, because we've, we've had users that said, Hey, I want to share my portfolio with my friend. And so that's sort of feedback is what led us to build our shareable portfolio. So right now in passive, you could build your tree fund, ETF portfolio, or maybe it's a portfolio of six stocks, or 20, stocks, whatever. And you could just share that with a friend. If your friend wanted, they could sign up with passive and just replicate that portfolio and enroll with it. I think, an improvement to that it's something that's on our roadmap would actually be to follow along with your friend as the investor, let's say Mike, you shared your, your, your portfolio with me. Eventually, I would be able to almost like get updates when you change it or do things because we're friends. So the idea is not for this to be like a mass thing that everyone follows. But like, like, I'm sure you shared your your investments with a few friends. Like over a beer or or or dinner or something.

Average Joe Finances:

Yeah, or WhatsApp chat. Yeah, it

Brendan Lee Young:

sucks, doesn't it? Like Like, wouldn't you like to just be able to take an auction? And then your friends know about it? And you don't have to go key it in and tell them hey, I just bought I just bought game. Hopefully you didn't my game. But yeah,

Average Joe Finances:

no, no, but I have friends and family members who did once they got in very low. So my little brother did okay with it. But yeah, he, I told him I was like, you're not an investor just because I was like, just, you know, be careful. He did the same. You know, I've other friends and family members who bought like, Dogecoin, and stuff like that. And, and, you know, I was talking to them, they said, Oh, yeah, drop down in price. So I bought the dip. And I was like, your average cost before is four cents. What's your average cost? Now? Is it go 16 cents, I'm like, and it's worth 32. I was like, so now you've only got a 50% gain, where before you had a significantly higher gain. So I was like, you know, you really need to rethink your strategy on this.

Brendan Lee Young:

You know what, and that. And that sort of like, it goes back to, like buying and holding for a long time. Like if you if you do your homework on a particular stock, right? You you could still buy it and actually never sell it right? Just Just hold it for a long time. And at some point, it's going to appreciate if it's a good stock. So that's sort of something that when I bought GameStop that was in my mind is that like, even though I'm buying this thing, I mean, I'm just gonna hold it for a long time. So it doesn't matter. So yeah, but I say this and I, I don't regret it because I learned at some, like, in my instance, like, what I should have done was not panic and sell. I sold it. Like I bought at $100 a share dropped down to like 40 for for a couple of weeks. And so when it said 40 is like, Man, I'm not going to sell it. And then when it rose back up to 200 I just I sold right away because it's like, I'll probably never get my money back right away. But we're talking about a few $100 we're not talking about like life savings, anything like that.

Average Joe Finances:

Right, right. Yeah, but there's a lot of people that did that. Like they took their entire life savings and just dumped it in and for the folks that got in too late. They they lost it all. You know, it was pretty bad. You know, they got left holding the bag, and that's one of the things you got to carry With a you don't want to take all your money and drop it into a speculation like that, you know?

Brendan Lee Young:

Well, well, I'll tell you something my friend he works on on the Canadian equivalent of Wall Street. It's called the street. And so I was asking him about the the GameStop traders like, Dude, what do you what do you think of GameStop? And he says, Brandon, I'll share with you a story that I sort of had while working on the street. And that was one day the markets went down and see he ran into the street and he said, Hey, dude, the markets are down, like you guys wants to be taken a killing on us initiates on it. The trader turned him and said, You know what, buddy, I don't care the markets up, I make money, the markets are down, I still make effing money. He just walked off. And so what what that said to me was that like, like the folks that that are professionals and play these markets, they, they know what they're doing. So if, if a stock goes too high, they're just gonna short it. So that when it drops, you know, they take the other side of the bed. And so folks like us, like, if you're not a an investment professional, sometimes you don't you don't know any better. And you think, like I did, I thought GameStop was gonna go up because it showed interest and all that stuff. Yep. That was the enemy. So if anyone's listening here, the key takeaway is, don't speculate. Stick to investment plan. If you are going to speculate, dude with money, you can't afford to lose And better yet, it shouldn't be money that was part of your, your your contributions.

Average Joe Finances:

Yes. Because it is a gamble for sure. Alright, so Brendan, do you have any last tips or tricks that you would recommend to somebody who's thinking about checking out passive?

Brendan Lee Young:

Yeah, um, visit our website www.passiv.com. on here, you'll see the list of rokers that we support. Right ow we support interactive rokers, TD Ameritrade, alpaca, e're going to be supporting lly invest soon in the US, I ssume most of the folks istening here from the US. And o these are really great rokers that you can use passive ith. And, you know, if you do ign up and you use passive, rop us a line, let us know what ou think how we can help. We're lways trying to improve assive, like I said, to the enefit of all, and feel free to ollow us on Twitter, handle his assive team, or you can follow e at Brendan Lee Young. And eah, love to connect, love to hat and

Average Joe Finances:

just feel free to reach out. Awesome. Hey, um, so that was actually going to be the next question I was gonna ask you too, is if you had a website and social media, you can share, but we've got that all. So what I'm going to do is I'm going to make sure I have all of that in our show notes. So it's easier for the folks to you know, just copy and paste it or click it, and go check out passive and what you guys are all about. branded, this has been a fun conversation. You know, we went a little more in depth to what passive is, but we also talked about other things and your own personal story. It was a really fun story to listen to like you, you've really done a lot since you since you moved to Canada, and you're continuing to do a lot and do awesome things for both yourself and your clients that you help with passive I really enjoyed it. I really enjoyed seeing what you guys are doing, what the team is doing. And even the conversation that we had about speculations and some other things. I mean, it's it was just a fun conversation. I really appreciate you coming on.

Brendan Lee Young:

All thanks so much. It's all good. I'll say one last thing. This This has to go to like it's the deal with like ETFs and the future of wealth management. And basically, I think I think the future is going to be direct indexing on top of brokerages. Like what if one day you can take your favorite index and strip away the the companies or sectors that you don't believe in? Like i think i think i think that's super interesting. What we're seeing is the emergence of Bitcoin and aetherium is seen as a new asset class like, like, like, like finance, wealth management, I think it's going to change in the next 10 years. And I'm just like really glad to be helping people invest in things that they want to invest in and take take control of their own financial future

Average Joe Finances:

be thing right they're taking control their own financial future, so I love it. Again, man, this was an awesome conversation. And I really truly appreciate you taking some time to talk with me today.

Brendan Lee Young:

No problem. Nice. Nice catching up with you, Mike. Alright, thanks, everyone.

Average Joe Finances:

Thanks for listening to the Average Joe Finances podcast. Your source for beating debt, saving money and investing Learn more at AverageJoefinances.com. The A erage Joe Finances podcast is f r informational and e tertainment purposes only. Do n t use this for any real estate f r investment making decisions.