Sandro Forte: In football, Chris particularly at the higher paid end of the game, it is a fact that 60% of footballers, and this is kind of eye watering statistic, but 60% of footballers are bankrupt within five years of retiring from football. Now, these are people who oftentimes are earning 10 million pounds a year, 20 million, 50 million it's inconceivable really that they should be bankrupt within five years

Sandro Forte: of ending their professional life in sport. The reason why it happens is that people don't separate logic and emotion. What they do is they live in this bubble. They're so used to buying flashy cars, nice houses. You know, they get divorced a couple of times and it’s no big deal because I'm making all this money, but they make no provision for the future.

Sandro Forte: And one of the things that I've learned is, and I created a simple algorithm. I know you are like the king of algorithms. And I created a simple algorithm that basically calculated how much of one's income they needed to save a footballer needed to save over a 12-to-15-year period to give them a lump of money that would yield an income that was broadly similar to what they were earning when they were playing football.

Sandro Forte: And generally, that number was 18%. So, what we're saying. If I took 18% of my income every year and put it to one side and invested it properly. After a fairly short period of time, I could replace the income I have to work for without having to work.

Chris O'Hare: Welcome everybody. I'm Chris O'Hare your quick win CEO. And in this show, we talk to entrepreneurs and industry experts on the different ways to improve your business and get the three quick win recommendations too. And today we're talking to Sandro Forte and Sandro is a financial advisor to the stars.

Chris O'Hare: He has footballers and even some Royals as clients. He is also an author of his book 'Dare to be Different' along with a podcast with over 200 episodes, which you definitely should check out after this episode. Now, I don't know where he gets all the time, but Sandro has also raised. 15 and a half million pounds for charity.

Chris O'Hare: And in this podcast, we'll talk about what the rich know about money that we don't. So let's go. Thanks for coming on this podcast, Sandro to kick it off, let's talk about the last thing you read or watched that, that left an impression on you. And that could be anything. It could be a, a book, a podcast, a quote something on Netflix could be anything.

Sandro Forte: Well, hi, Chris. Great to join you today. It's really kind of you to invite me to have a chat about let's be honest, a fairly dry subject, but we'll try and demystify some of it. I think that the answer to that question is an easy one. I read a book called Shantaram by Gregory David Roberts.

Sandro Forte: It's a very, very long book, but it is unbelievable if you've ever been to India. It's the true story of a journalist in Australia who was imprisoned for arm robbery. Of all things he escaped from prison fled to India, and the book tells the story of his life in India, living in the hiding in the slum, the relationships he forms life in India.

Sandro Forte: It's by far and away the best book I've ever read.

Chris O'Hare: Oh my God. I mean, sounds like quite a journey that he must have gone on. Not just You know, physically, but that transformational journey that he must have had thinking about what he really values and the way he sees himself and society.

Chris O'Hare: That's it sounds crazy. That's what a crazy story

Sandro Forte: it is. But if you, as I said, if you've ever experienced India and, and the people of India and life there. It's stunning. I should just add a caveat for all those listening that he wrote a sequel to the book, probably coz his publisher said we can make a bit more money and the, and the, and the sequel is rubbish.

Sandro Forte: I got halfway through and stopped. So from, absolutely a hundred percent. The best book I've ever read. I, I would definitely recommend it.

Chris O'Hare: Oh, amazing. I'm definitely going to check that out. Add it to the other list of other books that everyone seems to recommend, and you got a whole pile of them stacked in the corner, thinking I'm going to read those one day.

Sandro Forte: Yeah, so. Audible books tend to be my saviour. So I tend to go on, on long walks or runs and stick an audible on it two times. Speed. And they're they sound like Mickey mouse. It's quite interesting. So I tried that. Yeah.

Sandro Forte: I remember that. Cause it took me about three weeks to read Shantaram.

Sandro Forte: So yeah, I I'll remember that one.

Chris O'Hare: Well, there's this thing, isn't there about how actually the brain can digest information a lot quicker than you. You can read it, right? Cos you have that internal voice. And that slows you right down. But actually, if you look for keyword or you hear keywords, actually you get 90% of the concept or the information just by.

Chris O'Hare: Those key words. So, yeah, really interesting. Something I'm pushing myself to do. And actually, I know that I'm never going to read the book probably anyway, so I'll just shove it on and see it and see what, what information I can clean. The other thing I'd recommend is really learn the chapter titles and then understand what is coming up because that adds that context, that framework around.

Chris O'Hare: The book, but we're not here to talk about reading. We're here to talk about why, what the rich know about money that we don't right. So, and a really interesting con topic and it's something that I hear a lot of and. When I was listening to a, a podcast, Stephen Bartlett's podcast secret diary of a CEO, he had this little monologue it got it got, got me hooked Cos he had it as his intro trailer, you know?

Chris O'Hare: And in fact, I think I'm not going to do it justice, do it. Reading it off by my memory. I'm going to, I'm going to read it literally as a quote. And he said. A secret that I started to understand when I got rich and got rich friends and those rich friends pulled back a certain curtain and allowed me to see behind it.

Chris O'Hare: I've always heard about this, that there's a, another curtain I heard Joe Rogan did a podcast with Kevin Hart and on the podcast, Kevin Hart talks about meeting Jeff Bezos and realizing there's this other level, this other curtain that some people have, have access to. The more wealthy that I got, the more wealthy started to surround me.

Chris O'Hare: I started to understand what Kevin Hart meant and started to understand what the secret was. It was access to information and then the information itself. So that's a really, like he says everything and nothing all at all in that quote. And when I was, when I was thinking about access to information, so he is like, it's opening doors.

Chris O'Hare: But also, he talks about the information itself and it's almost like there's certain deals or movements going on behind closed doors that maybe people don't realize were. You know, if you have a certain pot of money, you can get in on these deals before other people know about it. I mean, what, what's your take on that, that quote?

Chris O'Hare: What do you think about it?

Sandro Forte: It, it's a very interesting one, this, because actually there are probably two answers to this question, Chris. One is that in my experience and I I've been in the wealth management business for 31 years and I have represented and still represent. The financial affairs of some incredibly wealthy people, sports stars, celebrities, couple of Royal families along the way.

Sandro Forte: So, I've kind of seen a bit of everything. I, I think on the one hand, what I would say is that actually the level of financial knowledge displayed by successful people is no greater or lesser than anyone else. The general level that people have in relation to financial matters is generally poor.

Sandro Forte: And I know many, many wealthy, successful entrepreneurs who are wealthy because all they do is they spend their time making money. That's what they are expert at. They're just brilliant. Generating capital cash for themselves, but they don't actually take time to understand whether the way they're making that is as efficient as it could be.

Sandro Forte: So, I would say in terms of knowledge, the curtain that Steve Bartlett talks about is not one of knowledge. I think what he talks about, and this would be my interpretation is part two to your question, which is cash money. Wealth is a commodity. And I would describe as a passport. It's like, A document that you can take to the best restaurant the best networking circles, and you can access infiltrate and obtain information that would otherwise not be available to you.

Sandro Forte: Because as, as a society, we tend to operate in. Close knit circles. We call them clicks and wealthy people tend to migrate together because there is something about the human ego that says I kind of need to know what other people are doing. So, I I've got something to measure myself by. So, you know, when you hear of these, you know, networking groups for high net, with individuals or busy people or whatever it happens to be, you tend to have a migration of like-minded.

Sandro Forte: People are in a very similar situ. And some benefit greatly from it. Others, don’t. I think what Steve Bartlett talks about is understanding what goes on in the inner circle. It's like it's like a Masonic lodge kind of people know it exists, but they can't get through the door unless they've sat satisfied, certain criteria.

Sandro Forte: And the criteria Steve Bartlett talks about is, is one of wealth because undoubtedly it is, it is a passport to more information. And the more information you glean look, 30 years, I know way. Not just about money and wealth and finance and managing it all in saving tax. I actually understand the practical aspects of it now because I have been part of that inner circle for, for quite a number of years.

Sandro Forte: So, I think that's probably the way I break it down into two very distinct parts, because a lot of people presuppose wrongly that if you are wealthy, you are more knowledgeable. And I would actually say that the opposite is true.

Chris O'Hare: Mm, that's really interesting. I mean, I think he talks later on that he talks about it, like the money game, you know, the, the rich played the money game.

Chris O'Hare: I never quite understood what he meant by that, but I think what you said is, is they enjoy. This process of having this insider knowledge and being a part of the clicks and, and, and having those doors open because you're, you're a part of those clicks. Yeah. That's really interesting. How many insider cliques are you in

Sandro Forte: Well, I mean, I, I do get to enjoy, I'll give you, you know, I'll give you a couple of examples. I look after a lot of premiership footballers. For example, I look after some, you know, very wealthy business owners, you don't, and this, this is a terrible thing to say, but it is a fact of life. So I'm just going to throw it out there that, you know, if you are either the advisor to, or you are somebody of a similar financial or social standing as someone else, you tend to find that if there is people in a private box at a horse racing event, or, you know, in a box at a football stadium, rarely Chris, very rarely do you have eight super wealthy people and one person who's just starting out on the road in life. Generally, generally speaking, you don't have that significant imbalance. You tend to find that people will generally want to associate with people that they perceive. It's not always the case that they are, but they perceive to be on a similar level to them. And as a consequence, I do get to spend time, not because I'm supremely wealthy, you know, I've done pretty well, but not because I'm as wealthy as some of these others, but because they rely on me.

Sandro Forte: Greatly to help them get to the next level. Mm. So the answer to your question is, you know, oh, good number, a good number.

Chris O'Hare: Well, that's, that's really good as well that you've clarified that it's not that you almost have to pass the test almost before you can get into these groups and that no one can just get into these groups unless you provide significant value to these types of people?

Chris O'Hare: I not, I'm not saying that's a good thing or a bad thing, but it's society in general, isn't it? You, you feel safer when you're with like-minded people and they, they must feel that way. And actually, it could be a security thing right over, you know, and an idea that they feel superior to anyone else or, or anything like that.

Chris O'Hare: So, you know what you share to someone like who's likeminded if that's personal information or whatever you feel like it's going to stay between them because there's nothing to be gained otherwise. So, yeah. I, I like that. That's really interesting. Okay. So, let's dive into a little bit more details about what, so you have the access to this information.

Chris O'Hare: But what about the little tricks that they might have because you, you hear a lot about these, these tax loopholes all the time, you got tax havens. You know, and something else I hear a lot about is like you know, borrow money rather than, than kind of have your own money and spend your own money because debt is, is not taxable and things like that.

Chris O'Hare: I mean over the time. How many of those little let's talk about tax loopholes first? What would you say they have access to that? That, you know, traditional people like, like, you know, me would not have access to,

Sandro Forte: well, this is, this is where I'm going to start to, I hope to dispel some myths because we've talked about Steve's Steve Bartlett’s quote and.

Sandro Forte: There is this kind of theory or mystical view that just because you're wealthy, you have access to stuff that other people don't have access to. And, and on the specific subject of tax loopholes, a tax loophole is one extreme is tax evasion because it is a dishonest way of avoiding tax. And it's a deliberate attempt to do so, but sometimes people will explore tax loopholes at that end of the spectrum because they say maybe a large firm that's advising them, might say, well, Chris you've got this, you know, a hundred million pounds.

Sandro Forte: If we put it into this particular trust. It's, it's never been done before, but logically it makes sense. And we've got the dreaded words barrister's opinion and the barrister's opinion is we've got this, this specialist tax QC, and he, or she says, you know, it should work. If we ever end up in court, we should win.

Sandro Forte: Well, that's not the worth that's to my mind. That's not worth the paper it's written on because it's an opinion. It's an opinion. And the reality is there is no financial disconnect between the QCs opinion and the objectives of the individual what I mean by that is someone is being paid to give an opinion. It doesn't matter whether it fails, or it succeeds, they still get paid.

Sandro Forte: So, there's a kind of a, kind of a vested interest in going, let's give it a go. So, at one end of the spectrum, it's the untested throw it out there. Let's hope for the best kind of solution, except that HMRC. God love them. They will tend to look at some of these schemes. And I'm, I'm thinking about all kinds of things from, you know offshore employee benefit schemes to certain kinds of trust in certain jurisdictions.

Sandro Forte: HMRC will eventually come along, and you heard about the film, partnership schemes and all the celebrities have got caught up in that. And eventually they'll look at this, this group of people sheltering, a pot of a ton of money from tax and they kind of go, you know what? We are going to go after that 150 million pounds of unpaid tax, and they'll throw the kitchen sink at trying to recover it.

Sandro Forte: So that's one end of the spectrum at the end of their end of the spectrum. A tax loophole is something as simple as putting money into a pension or taking advantage of your in individual savings allowance, or maybe using a loan trust or discounted gift trust or an inheritance tax scheme.

Sandro Forte: These are all loopholes because they’ve an avenue through which you can go or a place through, which you can pass that legitimately allow you to reduce your tax burden. So, we have to be careful about drawing a distinction between a deliberate attempt to avoid tax with no legislation to support your view and a legitimate tried and tested, been around for 50 years.

Sandro Forte: And so, in my business, and it may surprise you to hear this in my business over the last 31 years, I have never deviated from the tried and tested because actually there are in numerous ways to avoid tax. And the word of avoid by the way is perfectly fine. Evade, different conversation. You can avoid tax in many, many different ways and do it very, very efficiently.

Sandro Forte: So, all I would say about loopholes is if you start having a conversation with somebody who says, you know, stick all your money in the Cayman islands, or let's use this jurisdiction and this and this this special tax structure, and it doesn't make any logical sense or you don't understand it, or it hasn't got any bases in legislation, I would strongly advise that individual to leave well alone,

Chris O'Hare: I guess. If you're not that well educated, you wouldn't necessarily know the, the, the, the boundaries between tax evasion and tax loopholes. Because for me sticking, you know, money in the Cayman Islands, I thought was a completely legitimate way of, you know, Cos I, I know you avoiding tax, but I thought there was legal.

Chris O'Hare: Precedence to, to allow you to do that. But if, but like that's a really good point, actually, if HMRC changed their mind and decide to really go after someone then actually You've seen this recently, you know, that, you know, some of these presenters, TV, presenters are getting Adrian Charles, I noticed with the, was it the IR 35?

Chris O'Hare: I think it was that they went after, and they backdated it like 10 years or something. Wasn't it?

Sandro Forte: Well, there's a good example of a tax loophole. So, you've got self-employed people that were working for one company contracting for many, many years. They were saying, well, you know, I'm a plumber. I I'll get all my business from ABC property development company and Inland revenue were like, well, hang on a minute. You are not self-employed; you're employed all your income more than 75%. Your income comes from one source. Therefore, you are an employee for intents and purposes. And by the way, you've been doing this for 10 years.

Sandro Forte: So, we, now, now we, now we want employer national insurance. We want national insurance from you on a class one basis, and we'll go back as far as it suits us. So that's a tax loophole, but it's not legitimate. So, the trouble is you are going to get caught 99 times out a hundred. And, and just to add a caveat, there's nothing wrong with the, there's nothing wrong with investing offshore, by the way, you know, the Caymans, The Bahamas.

Sandro Forte: But actually again, in the vast majority of cases, you don't benefit overall from having your assets in an offshore jurisdiction. One great topical current example is a certain Chancellor of the Exchequer. We've all heard about the fact that, you know, he married into a wealthy family, but this lady's is a non-domicile, so she doesn't have a UK connection. And, and so there's nothing that she's been doing up until now from a tax perspective that it's been in any way, illegal. Unfortunately, there's been a public outcry and she's not paying enough tax. So, they've, they've volunteered to pay more tax, but the law was created for people like her.

Sandro Forte: Nothing, you know, all she's doing is taking advantage of it. So, you are right. You know, there is. And, and one of my top tips for financial success. Kind of know your subject, get as much education and no one's asking you to go through, you know, five years of exams to get to, you know, fellow of the of the charter insurance Institute as I have had to do, but just a general level of knowledge, Chris, that allows you to make informed decisions.

Sandro Forte: And in fact, In my business. I'm probably not the stereotypical financial advisor. God, God forbid that I should be. And, and my approach is very much. Look let's start with educating you. You know, I, I might be dealing with a divorcee who has never dealt with money before. They receive 40 million pounds from a divorce case, let's say.

Sandro Forte: And the first thing they say to me is, I don't know anything about money. I I've never dealt with it before. So, we start on a journey that involves me educating that person so that they can take ownership of their own decisions. You can't just say, do this, do that, do the other, it might sound great at the time because, well, Sandro's an expert, therefore, and he's come highly recommended.

Sandro Forte: Therefore, I should listen to him because unless you own it. 12 months, 24 months, five years down the line, you kind of go. I don't know what I'm doing. This feels uncomfortable. And then leading to point number two, if you don't stick with the plan, there's every possibility that it all falls apart. So, I think you're absolutely right to make the observation that knowing what you are doing, understanding the pitfalls.

Sandro Forte: And if you do go into a scheme that somebody says, this is our opinion, and you go into it with your eyes open and you make an informed decision. Well, that's a matter for you, but too many people unfortunately go into these. Their eyes firmly closed because they haven't taken the time to really understand what it is that they're doing.

Chris O'Hare: Mm. And I think that's what it all comes down to really is education and having the right advice from a trusted person who can give you. The pros and cons rather than what's their vested interest is if you know, they're going to get a kickback from it. So yeah, so again, it all comes down to who can you trust?

Chris O'Hare: And especially when it comes to something like money, because it's, so it can be quite scary. You can lose it quite quickly and you can also go to prison for it as well. So yeah, don't. Don't not pay the accountants. That's what people have always told me.

Sandro Forte: I was I was interviewed two years ago by the financial times.

Sandro Forte: And I remember the journalist saying to me, if you weren't a financial advisor, if you weren't in the wealth management space, who would you go to for financial advice? And I said, oh, you are really not going to like the answer. And he said, well, you know, what do you mean? And I said, well, I've been in this business for 30 years.

Sandro Forte: I've met thousands and thousands of advisors all over the. And I would say that probably less than 10% of the people that I've met along the way I would do business with now, that's not a sad indictment of financial services. Cause it's the same can be true of the legal profession, accountancy estate agents, you know, car salespeople.

Sandro Forte: And I don't want to pigeonhole people, but look, you know, all cards on the table. It's a, it's a much more aligned industry. Financial. With good reason. I'm sorry to say. We've all heard some horror stories, but there are some exceptional ones too out there. And the first bit of advice I give to anyone is if you can't educate yourself, you haven't got the time.

Sandro Forte: You haven't got the inclination, go find yourself, someone that you like trust. It's got the, the requisite qualifications and knows their stuff. And once you find that person stick to them like glue, because that person from a value perspective will be worth their weight in gold, you will achieve so much more with someone who holds your hand through that process who is always ahead of the curve rather than behind the curve.

Sandro Forte: I, I mean, I. I really despair one way not to make money, I have to say is to, to adopt this really passive approach to, to investing and, and management. And what I mean by that is too many times you hear these advisors who go, oh, you know, stick all your money. You're, you're a balanced risk investor. Chris stick all your money in this, in this lovely managed fund that we've got.

Sandro Forte: And what happens in reality is they then disappear off the scene because they've earned their money for setting the investment. And then you don't see them for 10 years and the only time that they ever get in contact after that, if there's a problem, Cos you're not happy or, you know, they're, they're sniffing around a bit more business opportunity, you know, I'm sorry.

Sandro Forte: And I'm putting that as bluntly as possible to kind of raise awareness in across the, the general populace that there are far too many transactional advisors, not those that. Really focused on service and building long term relationships, because if you've got somebody that stays on that journey for 10, 20, 30 years, and maybe not just for you, for your kids and your kids, kids, the, the opportunity to create wealth for yourself rises exponentially

Chris O'Hare: it's. It's nice to hear you say that. I mean, so my, you know, give you a bit of a rundown of my financial journey. I mean, I had no clue about. Investing, I was always told stocks are risky. I was that, that kind of person that was like, oh, don't put it in the stock, market. I'm going to lose it all. Cos that was the, the myth that everyone pervaded, you know, and as I became, no, as I, as my business started to do better and I started to surround myself with wealthier, financially successful individuals, they started telling me these, these kind of Stories of how they made money.

Chris O'Hare: I was like, okay, well, you know, if, if, if you were me, what would you do? And then they would give me their advice and I would take all these little, you know, nuggets of information that they would give out and I'll build this bigger picture. And my financial knowledge now is, is based around Recommendations with no financial incentive whatsoever.

Chris O'Hare: And I, and I really feel that that's quite a powerful base of knowledge, but there's, there's still so much, I don't know. So, if, if someone wanted to go and discover this kind of information, where would you go? What, what was the, I mean, obviously there's lots of different areas, but where would you go in terms of finding this information?

Sandro Forte: Before I answer that question. I'm going to just touch on something you said. Cause it's a really, really important point. I, I maybe inadvertently raised this as a subject, but when we talk about risk, because it's a conversation I have, you know, like a hundred times a day to, to explain what risk means and.

Sandro Forte: I'll try and put this in, in, in simple layman's terms, if I may. So going back to what I just said before about somebody comes to me and says, I've got 10 million pounds to invest or 50,000, and let's be clear. Wealth is, is whatever you make of it. I mean, wealth to one person is not wealth to another and vice versa.

Sandro Forte: So, let's be clear. 50 grand is wealth. If, if you happen to be in a position where 50 grand, a lot of money so let's not pretend that wealth is a number, Cos it's not, it's different things to different people, but unfortunately what people do is they kind of go, well, you know, I'm a low risk investor. And on that basis, if I was to draw a line on a piece of paper, zero being at one end that shove it all under the mattress and 10 being at the other it's red or black on the roulette wheel, I'm definitely not 10.

Sandro Forte: I recognize. Zero is not very sensible because I'm not going to make any money. I may be a three. The problem is most wealth managers, financial planners they'll stick all of the person's wealth in three. In other words, they'll find a portfolio that kind of matches the three out of 10 risk rating. What I say is you can still create the three out of 10 by having some money in cash, zero or.

Sandro Forte: You could have some of your money in eight, you could have it in a, in a small start-up business, Cos your mate down the pub has said, you know, we've just started this business. It's going great. I think we're going to do really well. Now you recognize that you are going to take a lot more risks by backing a small start-up company.

Sandro Forte: It's one of the biggest risks you can take with your money. But if that only represented 1% of your wealth. Then you are actually not taking that much capital risk. In other words, if it all went wrong, the damage to you financially is 1% of your wealth. Does that make sense? And the way and the way we counterbalance that is simply to have more on the other side of the three, which is the number we've given ourselves.

Sandro Forte: So, all you do is you balance it with more on the other side. So more of them. To counterbalance the eight. And it works all the way up and down the line. So, if you've got more in seven, you've got, you know, less than three vice versa. So, on the subject to risk people get really hung up with this idea that everything has to follow the same risk profile and it doesn't, you need some.

Sandro Forte: Things like equities or long-term property investments to, to create that capital growth. But of course, as we all know, people always want two things, maximum performance, minimum risk. So, we want to get the performance from somewhere. We have to take risk to do that. But at the same time, we can create a really good counterbalance so that if we get it.

Sandro Forte: You know, we don't put ourselves back to the, to the starting line. So that's, that's the answer to that particular point in relation to where do I get information? Well, you know, you can go to an advisor, but if you don't feel that now is the right time, you haven't got sufficient wealth or, or the financial objectives to have that conversation.

Sandro Forte: Then there are loads of places you can go there's, you know, don't necessarily love all of his content. But Martin Lewis at a very basic level. One of the things I, I focus on a lot is, you know, utilizing properly utilizing relief, exemptions, and allowances. There are actually lots of them in the UK where you can derive a lot of income growth inheritance dividends, savings without paying any tax that's.

Sandro Forte: Before we start worrying about anything else. But there are all sorts of financial publications, financial money marketing is good. There are loads of webinars. I mean, there's webinars happening all the time from, you know, large investment houses, Merrill Lynch. It's, it's easy to do Google search and just look for financial webinars.

Sandro Forte: There's always something going on. And just typing keywords, like, you know, releasing exemptions offshore investing risk, and you can find out load. Loads of really good, valuable content. And

Chris O'Hare: I think that lies the point though, that money is so diversified in terms of the way you can manage it and learn about it.

Chris O'Hare: That actually a lot of people just feel a bit overwhelmed by all the different areas that they could put their money and. Most people, well, for me, it would be almost sequential. So, we'd look at how to invest the money sequentially depending on where I am in my life. And, and the, the stage of my life.

Chris O'Hare: That means that I could do certain things. For example, I just bought a house first, first time buyer only just bought. Brighton's quite high in terms of house prices. So, and it's always felt like a moving goal post, but I knew that that was something I had to do. Cause I had to always think about the stability and security of having a roof above my head and I needed that.

Chris O'Hare: So, for me, that was that's my journey. So, I've learned all about that area. But if you were going to do it sequential well, let's, let's reframe the question actually. So, if you had to start from the very beginning. And you didn't have a lot of money to your name, and you essentially were going to.

Chris O'Hare: With everything that you know now, and you were going to basically maximize and try and make as much money as possible by the time, you know, you're middle aged. How would you go about that? What what's, what's the sequential steps that you would take? Cause then that would help me, but I can imagine a lot of other listeners on kind of the first, first few steps of that journey.

Sandro Forte: That's a great question. And, you know, let's be clear, there's going to be many different demographics listening to this podcast. At one end, end of the spectrum, you've got the millennials who are on that kind of fast track to wealth generation. So, they are in kind of fully focused tunnel vision mode where it's all about capital accumulation, wealth accumulation.

Sandro Forte: And what I would say to, to that group of people is you. I'm generalizing, of course, but normally you can afford to take more risk when you are 20 than you can. When you're 60. The reason being is that we know one thing we know in the history has told us this countless times is that even if you buy at the top, the asset like a property or a stock or a share at the top of the market, the highest price you could possibly buy it at, it's still going to be worth more in 10 years’ time.

Sandro Forte: So, a lot of people come to me and go is now the right time to. The answer is, I don't know, Chris. I have no idea whether now is a better time to invest than yesterday or tomorrow. What I do know is if you look at an asset and you are happy with the price you pay, so you've just bought a house. You paid X, you are happy to pay X.

Sandro Forte: It might be X minus 10% in a year's time. It might be X plus 10%, but you are not buying that asset for one year. You're buying it for 10, 15, 20. You might be buying as a springboard to your next property. I bought a whole bunch of shares, a lot of shares personally on April the 16th, 2020, the market had collapsed.

Sandro Forte: We just learned about COVID. Everything was shutting down and all of the travel stocks in particular collapsed, carnival jet two easy jet on the beach, everything. Disappeared not disappeared, but it felt by about 70 to 75%. One of the tricks to making money is to do the counterintuitive thing to buy when everyone else is selling.

Sandro Forte: It's how Warren Buffet made all his money. He talks about it all the time. So, I stepped into the market when everyone else is going the other way going, oh my God, I I've got no confident I'm losing money. What happens if I, I get to zero? They do the one thing you should never do when it comes to money and they make an emotional decision and that emotional decision, which is natural, is take a step back.

Sandro Forte: And as they take a step back, the brave step forward, and what they start to do is buy up all of those assets that are now very cheap. So, I bought all these stocks at X price. Nine months later, they're worth X times two. In other words, I doubled mine in nine months now at that moment, I thought, do I sell, or do I just keep hold of them?

Sandro Forte: And I made a decision to keep hold of them. Now with the benefit of hindsight, I should have sold them, but I didn't know what the top of the market was. All I remember is, was I happy with the price I paid on that day. And is that price likely to be higher? One year, three years, five years or whatever timeline it was, I gave myself and the answer was yes.

Sandro Forte: And I'm as convinced now that those shares, I bought two years ago will be worth four, five times the money two or three years from now. So, I'm happy with that investment decision, even though emotionally at various points along the way, I kind of go wish I'd done this wish I'd done that. If you spend all your life wishing what you would've done.

Sandro Forte: It's not a very pleasant experience. So, I I'm going to highlight this because there are always two emotions at play when people invest or think about money and you're right. Money is a blessing, but it's also a curse. If you don't manage it. Well, look at all these lottery winners that are bankrupt within five years because they don't manage it well.

Sandro Forte: And I will answer your question in a sec, but always two emotions emotion. One is by buy today and the value of the investment goes down. How do I feel the answer is rubbish, obviously. But then conversely, if I don't buy today, because I'm worried that the value of that asset may go down a bit, but it goes up and I miss the opportunity.

Sandro Forte: I miss the profit. How do I feel the answer is rubbish? So, what we know about investing is whatever you do, you are going to feel a bit rubbish. So, you've got to take a timeline, be happy with the price. And not close your eyes and blind faith, Cos you're going to adjust the, the, the sales in, in your financial boat along the way.

Sandro Forte: And that's sensible of course, but just don't get hung up on the, on the fluctuations in value along the way, because every asset that grows over time has to go up and go down. It has to, it's the only thing that leads to growth. So, you've got to kind of buy into volatility. And uncertainty in order to make money.

Sandro Forte: So that's, that's the observation. The answer to your question is if I go back to when I was 21 and, and I started my first job in, in financial services and, and I took this this thought, this idea to the football world because in football, Chris particularly the higher paid end of the game, It is a fact that 60% of footballers, and this is kind of eye watering statistic, but 60% of footballers are bankrupt within five years of retiring from football.

Sandro Forte: Now, these are people who oftentimes are earning 10 million pounds a year, 20 million, 50 million it's inconceivable really that they should be bankrupt within five years ending their professional life in sport. The reason why it happens is that people don't separate logic and emotion. What they do is they live in this bubble.

Sandro Forte: They're so used to buying flashy cars, nice houses. You know, they get divorced a couple of times and it’s no big deal cause I'm making all this money, but they make no provision for the future. And one of the things that I've learned is and, and I, I, I created simple algorithm. I know you are like the king of algorithms.

Sandro Forte: And I created a, a simple algorithm that basically calculated how much of one's income they needed to save a footballer needed to save over a 12-to-15-year period. To give them a lump of money that would yield an income that was broadly similar to what they were earning when they were playing football.

Sandro Forte: And generally, that number is 18%. So, what we're saying is if I took 18% of my income every year and put it to one side and invested it properly, after a fairly short period of time, I could replace the income I have to work for without having to. Now 18% for a lot of people go, they go 18%. That seems like a really big number.

Sandro Forte: I can't cope with 18%. If you took 18% away from me right now, I wouldn't pay the bills. Fair enough. But everyone pretty much. And I call it the 10% rule. If you took 10% away from everyone's current income and saved it, it might be painful for one or two months, but you know what? Chris people soon adapt to a 10% pay drop or pay rise.

Sandro Forte: Conversely to get a pay rise. What's the first thing you do go and find more things to spend money on. It's what people do. So, it's like living, it's like moving to a bigger or smaller house. You soon kind of fit your new surroundings. So, one of the things I would say is if people could just get into the habit of just putting, you know, earning a pound, saving 10 P earning a pound saving 10 P you will be stunned at how quickly you end up with a very, very substantial amount of money.

Chris O'Hare: That's really interesting. And so would you say that's the first step is basically make sure you, you get your, your savings together, but what, what happens then after that you got your 10% or for football is 18%. And that was fascinating. Like that really has made me open my eyes that they could live their lifestyle if they just saved 18% a year.

Chris O'Hare: And live on the essential compounding interest, I'm assuming. Yeah. Yeah. So how would they, okay. Say the normal person saving 10% a year or, or whatever. What would you then do with that money? What, where would it go?

Sandro Forte: That that's a, that's a good one. So again, going back to what I said about demographics, you know, you've got 20-year-olds, they are really thinking about, you know, money today.

Sandro Forte: Liquidity probably buying my first. So, an investment strategy, there would simply be keeping your money as liquid as possible. Now I know that means probably not making much money on it because you don't want to be investing in the stock market and hoping that in three months, the price of that stock has gone up because you might then need the money to buy a house.

Sandro Forte: So, what we generally say is, and, and these are kind of the golden rules of investing, almost like the hierarchy let's call it that a hierarchy of investing at the bottom. When you start. First thing you want is access to money, cash, liquidity, call it whatever you want. And that means money in the bank.

Sandro Forte: I call that an emergency fund. So, if the, you know, the roof blows off your house or the wheels fall off your car, or if you decide on a whim, you're going to go on a round, the world holiday or take a year out of university. You've got the cash to do that. And you don't want to speculate with that money.

Sandro Forte: It's painful to sit on cash because you're not making any money right now, but it's an essential part of any financial plan. Then you move up the hierarchy. So now as you start to ring fence money for the next event in your life, which might be, I don’t know, a known event, it might be a wedding. It might be starting your own business.

Sandro Forte: It might be upgrading your house and you see that kind of five to 10 years away. Then you start to properly manage that cash. That you allocate for that purpose. And then you, you be utilizing things like your individual savings account allowance, 20 grand a year, but also things like your capital gains tax allowance.

Sandro Forte: Cause everyone in the UK can make 12,300 pounds worth of profit on things like second properties like stocks and shares, like fine wines without paying any tax. And the, the reason why your question is interesting is so many people get obsessed with two parts of their life now and retirement. And what they say to me is I'm saving all this money.

Sandro Forte: I'm 25 years old. I'm starting my own business and I've got this little part of cash. Oh. And I'm going to start paying into my pension. I'm go. That's great. But what about the 25 years in between? What happens if you fall sick? What happens if you can't work for whatever reason? So too many people are obsessed with short-term investing and long-term investing and forget the bit in the middle.

Sandro Forte: Cause the bit in the middle is what connects today with tomorrow. So, the hierarchy of planning goes. All your tax-exempt savings opportunities, which creates liquidity. And then once you build your wealth and you start moving into things like you know, wealth that might be an excessive, you know, one or 2 million, then you've got another tax problem, which is inheritance tax.

Sandro Forte: And so, there are certain investment vehicles you can use to mitigate. Investment bonds is a, is a good example. Pensions are exempt from inheritance tax, but one thing I never say to a 25-year-old is shovel as much as you can into pensions, unless you've got a particular need to reduce the tax in your company.

Sandro Forte: For example, because I've seen so countless, countless numbers of people diagnosed with a serious illness at the age of 45, and they've got this massive pension part. They can't. They can't retire until they're 55, 56, 57 or whatever. The, the latest they'd probably be late. Yeah. So good. Financial planning is about liquidity structure short term, medium long term.

Sandro Forte: It's kind of combination of all those things. Best way to describe it. A really good cake has a great balance of ingredients, too much butter. It's greasy too much. Flour is dry. Your kind of, it's a terrible analogy. I don’t know why I thought that I love it. That's great. Well, but if all of the ingredients are well balanced, it doesn't matter.

Sandro Forte: Whatever life throws at you; you can lay your hands on cash. You know, if you get all the way through to that time in the future, where you decide to call it a day, you retire wealthy or at least with enough income. And, and obviously if you can mitigate tax along the. If you've got a pound, I say this to all my clients.

Sandro Forte: If you've got a pound, Chris, and I've got a pound and mine is taxed and yours isn't taxed. You are going to make more money with your pound than I am with mine, obviously. Going back to your question about loopholes without even worrying about loopholes. There are lots of ways that you can make sure that the pound you earn isn't taxed.

Sandro Forte: And that goes a lot further than if it is

Chris O'Hare: well, that's the other thing it's like, everyone talks about, you know, the interest rates or, or the returns. Like if you put it in the stocks or whatever, maybe you get 10% maybe. You get a bit higher, but with tax it's always 20% or, or higher. Right. So, if you're saving that tax straight away, you're saving probably the most amount of percentage you're going to get on your money.

Sandro Forte: Well, it's worse than that. If you're an employee in the UK right now, that's higher. Yeah. You're paying 0% up to 12,570. Then it's 20 up to 50,270, then it's 40 and in excess of 150,000. You're paying 45% tax, except that on the income between a hundred and 125, you're paying 60% because you've now lost your personal allowance of 12,570.

Sandro Forte: Mm. Then throw in national insurance, which is 15, just over 15% for an employer, just over 13% for an employee. You know, once you add it all up, the actual amount of direct or indirect you tax you pay, or your employer. It's close to 75% when you are really at the top of the earnings ladder. And then you've got capital gains tax.

Sandro Forte: When you sell that second property or you buy a second property, you've got stamp duty surcharge, and then you die. And the inland revenue wants 40% of it all. So, you know, if you do no financial or tax planning, you are over the course of your lifetime paying pretty close to a hundred percent. In total taxation on all of the money you've earned through your lifetime.

Chris O'Hare: That's insane, just shows you actually how much how valuable it is to know a lot about tax and how to, you know reduce it, especially when it's those kinds of returns. it's just crazy. And so, a lot of people, especially younger generations, I mean, they say that 75% of young people are now investing.

Chris O'Hare: 75% consider that, you know, 20 years ago. I'm pretty sure that was not the case. And it's because of all these little apps, like Robin hood and, and free trade and obviously crypto love it or hate it. There's a lot of people trying to get rich on, on, you know crypto speculation, but the thing is They're not taken into account tax.

Chris O'Hare: I bet. I bet they're not. I bet they're just looking at these, these stocks and thinking, you know, this is how I'm going to make my, my money go further.

Sandro Forte: But that's, that's a good, you know, that's a good point on the subject, crypto, crypto people phone me and go I I'm thinking about investing, investing in Bitcoin.

Sandro Forte: I'm like, okay. But in all the years I've known you, Fred. You've been a cautious investor. Yeah, I know, but everyone's making loads of money on it. And this goes back to that whole emotional decision-making thing, FOMO, isn't it? Yeah. It's $60,000. And my mate down the pub he's made, you know, he's double his money in the last 12 months.

Sandro Forte: So, I'm going to go out there and double my money. It doesn't work like that. There's, there's probably a greater chance of you losing half of your money right now than there is doubling your money. So again, people do get swept along on this kind of idea that everything goes up in a straight line, which of course it doesn't, as we know.

Sandro Forte: And I know that logically people know that, but you be astonished. The number of people who just kind of jump on the bandwagon because they see everyone else do it, except that the time that they jump on the bandwagon is never at the beginning, Cos they're not brave enough, or they don't know enough about it.

Sandro Forte: They always wait until the, you know, the tr the train is halfway down the track before they, before they jump on that train. And then of course it goes over the hill and down the other side, and then they kind of go, oh my God, I'm losing money. Get out. And then all you do is you've crystallized the loss that you've now created.

Sandro Forte: So, and, and to your other point, just very briefly, because I know times against us, but when people going back to that kind of 18% save your money thing and people go, oh, you know, I can't give up 18%, my income. I can show most people how to save 18% of their total income just in tax. So, you know, if I could show somebody how to create the money that they can then save for their future, that's not a bad deal.

Sandro Forte: So, you've just got to, you've got to know the whole process end to end, bolt it all together and you know, and that's how the rich become rich.

Chris O'Hare: There you go, you summarized it right at the end, too. Okay. Just to give us some quick wins, three quick wins on, on how to get the biggest returns. If you're investing to that.

Chris O'Hare: I think I already know these, but just to, just to summarize them, what would those three be.

Sandro Forte: First thing, good diversity and balance. As I explained, you can take risk, but you can counterbalance it with something of low or no risk. So, you can still go chasing the, the dream ticket without risking everything.

Sandro Forte: Be financially more astute. That doesn't mean you have to employ a financial advisor or an accountant or a little, whatever. Do some research take some time out half an hour a week. I, I wish that in schools today, Chris, they taught people financial gave them financial knowledge, whether it's understanding how inflation works and, and how the world spins economically, that would be invaluable for people.

Sandro Forte: And this will come as a surprise, but even if you are 25 years, Live with your mum and dad just starting your business, a will. And a lasting power of attorney are really good underpinned to any financial plan. Why? Because 65% of the UK population still die without a will. And there is an enormous amount of money that is lost to inheritance tax to people that should be getting the money, not be getting the money.

Sandro Forte: So, something simple, like a. Just to let everyone know what you want to do with whatever wealth you've got, whether it's a hundred quid or a hundred million. That's a, that's a very sensible way of making sure that you protect your assets if the worst should happen.

Chris O'Hare: That's fantastic quick wins there.

Chris O'Hare: Thank you, Sandro. You've opened my eyes to Tax. I'm definitely going to pay more attention to calculating my tax. So, thank you for coming on this podcast. I'm sure everyone's going to love it. Pleasure. Thank.

Chris O'Hare: Thank you, everybody. Sandro was a great guest and make sure to check out his podcast, the Sandro Forte podcast. We also spoke a lot about planning in this episode and planning was the topic of our last episode. Be the 2%, what you need to know about planning with Jeff Gosling you can check that out by Googling Quick Win CEO, but until next time I'm Chris O'Hare your Quick Win CEO signing out.

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