Thomas Kopelman is a top 100 Financial Planner and the Co-Founder of All Street Wealth, a fee-only financial planning and investment management firm offering services to clients in their 20s, 30s, and 40s.
I spoke to Thomas about a variety of topics, and I’m going to break down my 4 favorite takeaways below:
- Create momentum
Let’s dive in.
Thomas works with clients, providing financial advice, investment management, tax planning, and more.
I wanted to know the most common mistakes he sees from clients who come seeking his help.
He told me: complexity.
“Investing is really about buying the right diversified basket of goods, like the S&P 500… then you don’t have to worry about when to buy or when to sell. You just stick with it for a long period of time. I think the more simple it is, the better.”
Keep it simple:
- Buy the right diversified portfolio
- Don’t focus on when to buy or sell
- Stay patient
You probably know that you should have a diversified investment portfolio. It’s generally better to own all the stocks than just a handful.
But have you thought about diversifying your investments from your employer or industry?
Thomas emphasized that investing heavily in your employers’ stock can pay off. But here’s the catch.
He also encourages clients to have a large part of their investments elsewhere in a diversified portfolio.
“Think about the real estate agent who makes money by selling houses and invests their money by buying real estate. If the real estate market hits a bad period, [they] face a ton of risk.”
This shows the importance of diversifying your source of income from your investments.
“In tech, a lot of people have a hard time diversifying out of their company stock because they see how other people have succeeded. But more times than not, it’s not going to happen in the perfect way where you’re all of a sudden this mega millionaire.”
This shows the importance of investing in a well-diversified portfolio.
It also highlights how we need to manage our expectations. Be skeptical of any opportunity to “get rich quick.”
If you’re getting started, you need to make a plan.
If you’ve already started, you should make sure that plan aligns with your goals.
For Thomas, that means starting with your 401K match – that’s free money.
After that, he told me he recommends building up 1 month of emergency savings and attacking any high-interest debt (6% or higher). For most people, this is $1,000-$3,000, which Thomas says will cover most emergencies.
That one month of emergency savings will protect you from going back into debt if something unexpected comes up.
If you have debt with an interest rate higher than 6%, paying that down may be a better use of your money than investing, where you may or may not earn a 6% return in the short term.
Thomas compared personal finance to fitness:
“When you’re getting started in fitness… you go to the gym four days a week, and if you’re not having fun by 20 minutes in… you leave. But what you’ve done is create a habit.”
If this sounds familiar, it did to me too.
James Clear talks about this exact concept: If you’re building a new habit, make it easy and scale from there.
“Consistency before intensity. Start small and become the kind of person who shows up every day. Build a new identity. Then increase the intensity.”
James Clear, Author of Atomic Habits
If you want to improve your finances, start small, celebrate the wins, and scale from there.
Where to connect with Thomas
- Listen to his podcast: The Long Game (a podcast meant to educate young people about money)
- Say hello on Twitter