By coinnews 
0:05 spk_0
Well fabulously. So do you remember David when I spent my tuition reimbursement one year on a trip to Las Vegas to see Madonna?
0:13 spk_1
I do. Uh, we’ve had some not so fond conversations about that. And as a matter of fact, folks, today’s guest has somewhat of a similar story, almost losing his whole down payments on playing the stock market like he was in Vegas.
0:26 spk_0
So naturally we had to have one to talk about money.My mistakes and making your finances fabulous even when things kind of go off the rails,
0:33 spk_1
right? So me David Lester, a proud financial adviser, best selling author and TV money expert who’s been helping people do better with their money for over two decades,
0:43 spk_0
from nearly losing his home deposit on risky traits to found his own financial services firm, David’s a masterclass and turning your financial missteps into successful money
0:52 spk_1
stories.Thank you for joining us, David.
0:55 spk_2
Thanks for having me.
0:58 spk_1
So there’s been a lot of volatility in the market recently and this, but a lot of people who have been advocating for buying on the dips. There’s also been some, uh, maybe people who have earned the accusations of insider trading, so there’s a lot of sense of greed among people right now along with this all all of this volatility. Um, you have some experiences with fear and greed. Can you
1:22 spk_2
share that with us?For sure. Um, yeah, one of my biggest mistakes again, was just getting wrapped up in the market. I was a baby banker at the time. I was working at Merrill Lynch, and everything was going up and going perfectly, and I had this nice little nest egg for to buy my first place. And I was a derivative trader at Merrill Lynch and was, you know, I learned how to use options and there’s safe ways to use options, and then like you, you had mentioned, there’s like gambling with options.And it had worked for a few times until it didn’t work. So it was a great lesson to learn, and I luckily was able to recover, but it’s, it’s amazing how that even from a professional, that fear and greed, not fear, greed, takes over until there is fear, and it’s a great lesson to learn that early on because I think that uh if you get burnt later on in life, there could be a lot um a lot bigger um damage to your finances.
2:22 spk_0
Yeah, absolutely. We’re gonna dive into the, the fear and greed here in a little bit, but do you mind for our listeners and viewers who aren’t familiar, can you define what derivatives are and what options trading is?
2:33 spk_2
Absolutely. So, options are something that pension funds use, um, like the teacher’s pension and things like that, and there’s a way where you have a big pile of stocks. You can use auctions almost like, and this is what they’re supposed to be used for, for insurance. So if you think that umSay soybeans or for like a big pension or a farmer, they’re actually originally made for farmers. And if you thought that you wanted to secure your crop for the future, you can set in future prices or uh in the future. So it was made for a for to be, you know, an insurance product to secure farmers’ prices or oil, whenever you see the futures for oil going up and down.Same kind of thing. And these traders are locking in the prices, but you can use them in an aggressive way as well. And that’s what a lot of people do, especially rookie traders. When you see on like Robin Hood and some of, in, um, you know, during 2000 or 20 when the, uh, when COVID was happening, everyone was in their basement, they couldn’t go to work, they were getting government checks. They’re putting into Robin Hood and using it in a bit of an aggressive way.And it basically without owning, say, like 1000 shares of GameStop, you can control those amount of shares, and as they go up, you get a much higher percentage of profit from them compared to if you had to outlay all of the money for to buy all the shares.Um, it is a bit of a complex thing, but it’s when you use a call option, um, and you’re buying it, it does mean that you’re basically, you have a chance for it to go to zero, because it’s like an insurance product that it’s going to expire at some point. Um, unlike if you had, you know, 1000 shares of GameStop, and they went down 50%, you would only lose your money, you still have the other half. But in an option, it’s so volatile that even if it goes down a little bit, you could like wipe out your entire investment.
4:33 spk_0
So all that being the case, I’m sure as a financial advisor, your advice to your clients would be if you have cash that you want to use the next couple of years, you probably wanna put that in a cash position, maybe a high yield savings account or maybe at most a CD.What made you take on this kind of risk was such an important pile of money that you have?
4:52 spk_2
Yeah, I get it was cause in the past I had made, um, you know, a lot of money from it, so that was the thing that’s what how I was able to have a deposit for my home in the first place was being able to use these options.So, again, it was something that it goes well, just like for everyone and, you know, working on GameStop as well, but I don’t know if everyone was familiar, but it was shooting through the roof for such a long time and people were using so many options, they’re becoming, making so much money, these little whipper snappers that are in their basement.Their parents’ basement, and we’re just getting government checks and we’re making, you know, all this money. But when it turns around, it turns around. So I was kind of sucked into the, the same idea that, you know, you could, once you know it, that it, it works until it doesn’t work, and then it can turn around and rip your face off.Yeah,
5:42 spk_1
sure, yeah, thatcan be that adrenaline rush, right, of watching it do really, really, really well. How did you end up figuring out how to manage that adrenaline rush, that desire to to to just risk it all, um, and, and I guess to a certain degree that that grieve for that, or the fear of losing it all.
6:04 spk_2
Right, yeah, I think it was like just that one mistake. So, you know, um, it was, yeah, when you have, when you get birth like that on one trade, and I’ve always stayed away from it, and especially with, you know, I, I’ll play options in a smaller position, but for my bow position, it was really risky at that point, but I was young andYou know, you know, I, I, I was playing the part of uh all of the bakers that were down there, and everyone brags at the bar afterwards, when we leave, you know, our baking jobs and how much people are making. So it’s funny how you can just get into like the social, the social group talk, just like before it was at the bar after after we were bakers, and then now it’s online, so it’s easier to do that online.People can talk about how much money they’re making and uh what they’re doing. So it was, but my lesson was learned after the first time. And then because it’s my job, I learned better ways to use options and there’s infinite amounts of, you know, investment vehicles. But I’m lucky I bought it. I learned that lesson pretty early, because otherwise it could have been, uh, destructive if I had just learned it later on in life.
7:14 spk_1
Yeah, definitely. Um, it seems like a lot of that discussion is happening on Reddit right now, right? There’s a lot of Reddit, uh, threads out there that people are uh are uh talking about, um, about options. One of the things that seems to be driving a lot of talk about options right now too are tariffs because of the volatility that tariffs have brought. What are you telling your clients about how to manage the, the, the risks when it comes to tariffs?
7:43 spk_2
Yeah, I’m actually not a finance, I’m a TV financial expert, so I don’t actually have client clients, um, but I, when people ask me individually if they’re about options and things like that with like volatility right now, um, you get a much bigger premium. I was talking before about it being kind of like an insurance product, and you know, the premiums that you have, because of the volatility, it’s part of the recipe that makes options. So it is.Very expensive, um, uh, or yeah, it depends if you’re buying or selling, but there’s a lot of premiums. So I think in Reddit and, you know, everyone on the Robin Harford account is probably diving in again, because you make so much more money when there’s this volatility and there’s the the, the volatility index that’s built into the recipe for options as well.Yeah.
8:31 spk_1
So do you think that uh that uh right now is it the volatility caused by terrorists is something that uh individuals can take advantage of and and or is it maybe something that folks should be using as that insurance protection for what’s happening with their portfolio?
8:50 spk_2
Right, yeah, it totally depends on the individual, because we have such different portfolios for individuals, but a prop, a good way, like a safer way, there is a safe in investing, especially now with tariffs and all the uncertainty. But if you sell options, I know this is kind of a complicated conversation, but if you sell options, then you’re doing the opposite. It’s you become the casino instead of the gambler, you know, for using options. So if you’re buying them, you could go to zero andSomeone else has collected that premium I was talking about. But if you’re selling them, so if you have, you know, 100 shares of Nvidia or whatever it is, you can sell options higher up. And with the volatility and the VIX right now, the prices are quite good. Even if you have a dividend stock, if you had, you know, a bank or something like that that pays a dividend, you can again sell these options higher up. And of course, you have to talk to your adviser because this is quite a sophisticated strategy. A lot of the like I was mentioning budget funds use options in this way.Um, but if you sell it higher up, then you are getting two renters. So if you see that stock as a rental property, you know, as opposed to an equity, you get a dividend, and then you’re putting in another renter when every 3 months or so you’re selling these objects. So, um, yeah, so it’s definitely a different way to get another sophisticated uh strategy, um but uh yeah, that’s uh that’s what.Old money kind of, when I was working at Merrill Lynch, all of our wealthy clients would do that because they have these big positions of stocks, and they would go ahead and um rate options on them when things are going down, and they knew that they would never sell these stocks. So, a lot of times you buy stocks, you hold them forever, you collect the dividends, and in this scenario, because the VIX is so high, it’s great, you can make another like 3 or 4 or more% every few months just by selling these options and collecting the income.And um yeah, and as the stock market goes down, it’s, it’s providing you more cash to buy more shares or for a cushion in your cash cash position. So it’s, it’s really um a wealthy client strategy or a pension strategy, or you could do it yourself, but I don’t think most, um, you know, retail brokers would apply this to the account.
11:07 spk_1
You know, I appreciate that you kind of correlated this or gave us that analogy of, of renting it, um, because we have this, you know, that we hear this saying over and over again, use your money to make money. But you’re almost saying, use your money that has made money to make even more money with this idea of rent.that are inside of ranchers inside the renter uh with options and it’s, that’s a very interesting concept, and I think that’s something that folks, if you are interested in, you can dive deeper into that because it is a great way to use your assets to make more money. We’re gonna take a quick break and we’ll be right back with David Lester.Welcome back to Living O So Fabulously with David Lester. So, David, let’s continue our conversation here, reflecting on your journey with uh with financial habits that you have to unlearn when it came to achieving your current financialsuccess.
12:12 spk_2
Um, right, so things I had to unlearn, trying to think what I, well, it’s like what I had to unlearn, I learned that values and freedom in an individual are what motivates us. So when I was working at the bank, I always wanted to work in the bank, uh, but I have a strong value of freedom. And I, you know, it’s my first day. I had like an amazing outfit and a little brief briefcase, and I was ready to go on my first day after having all my licensing.Courses I did them while I was still at college. So I was so excited to start. And then when I got there, I was like, wait, I have to sit in this office, you know, for, for 30 years or whatever, and then retire. And it just went against my core instinct of having, um, a value of freedom. And so I think that finances allowed me to have to satisfy my values. And you need to understand what your values are first in order to build a career and your finances all around you.So because working in banking and being licensed in one region for such a long time went against that, I was able to build a career I have now, where I can work anywhere, you know, as long as I have a computer, um, I’m able to travel and it satisfies one.Many values that I have of freedom. So I think that was the big thing for me to really kind of smorgasbord a perfect career for me, where I took all the things I enjoyed and discarded the things that I didn’t want. And it’s all based on your values, and my values and what makes me tick.
13:40 spk_1
Was there any specific moment besides maybe getting stuck in the in the cubicle? Was there any specific moment that kind of shifted your values and helped you solidify those in your not only your career, but maybe in the way in which you use or have a perspective about money?
13:55 spk_2
Yes, I was reading a ton of psychology books. And I think that’s the problem with financial people is that we always just look at the dollars and cents. And I was trying to read as much as I could about neurolinguistic programming, psychology to really come at finance and my career in a different angle. And that’s where I discovered.Values and um understanding what values are as an exercises to, to bring them, you know, up to the surface so you can understand them. So it’s really the psychological, and there’s so many great books out there, Psychology of Money, um.Yeah, there’s like so many, and I think that that’s the great thing about finance, how it’s changing now, is that now we’re looking at the psychology. We don’t just look at the balance sheet. The balance sheets like the last thing that you should look at. You should really be looking at, you know, what makes you tick, what you wanna do, look at your life, you know, way down, and work back.to see all things you want to achieve, because only then can you, like I did for myself, rearrange your career, how you’re making your money, how you invest your money, uh, to satisfy what you want to do through your entire life and working backwards is a great way of uh doing that.
15:07 spk_0
Yeah, I thought that you say that. David and I often say there’s an 80/20 split with personal finance. 80% is the finance that, you know, a dollar works the same for you as the dollar works for me. We all swipe our credit cards the same way. But 20% of finance is based on who we are, our background, where we come from, our socioeconomic class, race, gender, such, uh, creed, and all that. But also it’s, it’s the.You need things that we want to achieve. What I want isn’t necessarily what you want. And we need to sort of architect the life that we want. And until we know what it is we truly want, and not what everybody else thinks we should want or what we think everybody else thinks we should want, um, are we able to live the life that we want according to our values? I love how how you articulating that.
15:47 spk_2
Yes, absolutely. And even to like 401ks, if you think that you want to retire in Sicily in a palazzo, you know, and going swimming every morning.And, uh, you know, wearing a tiny little manki while you’d go down there. Other like whatever you want to do in your future will determine if you’re gonna have a 401k or if you’re gonna keep things in cash, or like in like a non-registered account. Um, so it’s really important to map out your life first. It’s kind of like having the mice, like a mouse with a with a big maze and the cheese, showing them the cheese, and then backing them through.The maze of letting them go, and then they can, you know, fire off and get it really quickly instead of how most of us do is like just like soldiering on forward and making mistakes and changing, but it really helps to have a complete life and making a list of everything you want to accomplish, building it into the, you know, your money matrix, and then making sure and this is the most important and then making sure that you’re doing.You know, if you have a job that doesn’t pay you a lot and you want to do these other things, there’s a way to like start your own business like I did, or maneuver yourself if it’s freedom. If there’s more creativity, there’s a way that you can merge creativity. Like now I get to write books and talk to you fine gentlemen. So there’s ways to, if you really figure out how you tick, then you can, you can build the money matrix that works for you, career, uh, investments, rental properties, you name it.
17:08 spk_0
I’m hearing I’m smashing pumpkins right now. So, there’s
17:12 spk_1
a lot of wisdom there, and I’m curious, based on your years of experience, um, I don’t wanna call out your age, but on you with your years of experience, thinking about that line of thought of how negativity can easily creep in and kind of control our thoughts, our emotions and the way in which we act.There’s a lot of fear for folks in the LGBTQ community right now, especially due to politics. Um, so we have a high level of anxiety, and in some cases, some people are just downright scared for their lives, right? So how do you see this impacting the finances of the community and, and are there any ways that we can protect ourselves?
17:52 spk_2
Yeah, and I think we need our almost our own Reddit, and this is great that you guys are doing this podcast, because I don’t really know that many other public places where we can just chat and be open with each other around these feelings and fears. Um, you know, I’m really close to my family, so that’s, I can talk to them when they, when there’s anxiety, um, and there’s so much anxiety, not justUm, you know, sexual anxiety, uh, there’s financial anxiety, and there’s all these different anxieties, um, environmental and etc. etc. So, and if you need to really, uh, zone into it and I think we should start more of these financial clubs for, uh, um, for us just to being really open with each other with the successes. I think there’s a lot of fronting, you know, in our community, and so we should definitely do the back the backing. I don’t know that sounds dirty, but you know, there should be something else that we can get together.Uh just like really be honest, um, with people that are, uh, feeling nervous and don’t know where to get started, because it is intimidating to, for anybody to walk into like an advisor that’s just trying to sell you some dumpy mutual fund, you know, or you open a business account, like, if you have a special idea that’s so unique, who do you talk to? So I think that definitely, I love that you guys are doing this podcast and we should really open it up to some people can really easily find these, um, you know, uh, um.You know, a, a business Reddit or whatever.
19:18 spk_0
There’s thank you so much. Um, as we wrap, what’s what, uh, our last question for you is, what’s one piece of money advice that you would share with the LGBTQ pluscommunity today?
19:28 spk_2
Um, the biggest one is for the long term. I think that if you, it’s funny, after all of the, you know, I was mentioning that I was, I was a Merrill Lynch, um, I worked in private, um, worked in um derivatives for a while, and then I’ve moved into these different areas. But if I had just pushed, like, just in contribution, you know, when I was when I had graduated college, and it was just like, it probably would have made me more money than me like doing options andYou know, having rental properties and buying art and all these different things. So, if you don’t want to uh go into these different areas, I do love it, so it’s like, it’s a bit of a passion for me. Uh, you know, if you just do these monthly contributions into something easy like Spy, it’s just like the whole S&P 500 or QQQ which is like the NASDAQ, and just do monthly contributions, you know, you could be the whole person and now the 3rd on the with the cigar and the.A while the rest of us are out the leg and doing these other things. So I think that you can make a lot, and I’ve seen it happen, and these people that just, just set it and forget it. And as you get a raise, just increase your monthly payment. And, um, you’re just, you’ll, you’ll be set in the long run with the, um, you know, all the gnashing of teeth and, um, and the angst that, uh, everyone else is going through.
20:45 spk_1
Yeah, I love that. Yeah, I love that. It just sometimes it’s slow and simple, and we do know that the data is out there that I think it’s 80% of millionaires are millionaires because of their slow consistent contributions to their 401 cases.So
20:59 spk_0
thank
20:59 spk_1
you for joining
20:59 spk_0
us, David. We appreciate having you. Yes, was my advice? Yeah,
21:02 spk_1
what’s
21:02 spk_0
your
21:02 spk_1
takeaway?
21:03 spk_0
I think I’m gonna, we don’t talk about this enough. We don’t, I think the slow, consistent, boring investing is wealthy investing, and the sooner you can start that boring investing, the better. I think we get, especially in this kind of market, we get all excited about all these exciting different products and strategies and to start young and and and and that’s boring.
21:21 spk_1
Yeah, I, I think mine is your comment, David, about.Values and understanding what our values are as early as we can, because that will really help us through times of volatility in the market, times of volatility in our own lives and how that affects the way in which we spend our money, use our money, invest our money, and I think that’s really important, uh, when we, cause then it makes it it makes that anxiety and stress a little bit easier because we know the decisions that we’ve made, even though they may not always be the most financially.Uh perfect decision, it still aligns with who we are on the inside. So thanks for tuning in, like, if you like what you see, scan the QR code and follow Yahoo Finance podcasts and more videos and expert insights because when you do, it keeps your house deposit where it belongs in escrow, not in an emotional trading day. So until next time, stay fabulous.
22:23 spk_3
This content was not intended to be financial advice and should not be used as a substitute for professional financial services.