An Interview with Lance Alston, Wealthfulness Expert

Brooke Lazar

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Lance Alston, author of Wealthfulness: Simple Steps to Financial Health and Happiness, has spent years learning finances to help others. He shares his story.

Brooke Lazar (BL): How did you become interested in the details of finance?

Lance Alston(LA): I bought my first stock as a 17-year-old employee of a trucking company. The company offered an employee stock purchase plan, and I thought, "Why not?" The plan was a great deal. Investing hooked me, but it took decades before I connected the behavioral part—more money did not improve my happiness or success. Money compromised both of them.

I sold stock in my sophomore year of college, and I decided not to work a part-time job. That year of college, my GPA suffered because I thought the money from the stock would make me invincible.

Next, I doubled a small investment in less than a year, which was pure luck during the early days of the technology boom. This investment was worse because early successes at stock-picking will almost always lead to much larger risks and much more expensive mistakes later on.

The lesson: playing with "free" money—whether it's an inheritance, a bonus, or a lucky stock pick—encourages over-confidence and risky behavior and often leads to bad outcomes.

My parents never talked about money, so I had to learn those lessons the hard way. I'm a big advocate for student financial literacy to save them from having to learn those hard lessons.

BL: At one point, you co-hosted a financial radio show. What was it like talking to distinguished financiers?

LA: We rarely interviewed entrepreneurs or Wall Street financiers. We focused more on the academic and policy sides of finance. The only entrepreneur I remember interviewing was T. Boone Pickens, and that interview was about his policy ideas regarding renewable energy.

Professors and policy wonks—those with a major interest in political policy—were far more willing to answer our emails. The hedge fund managers were too busy to talk to our producer. Plus, someone who can make a billion dollars playing the market doesn't interest me.

Someone like John Bogle, who founded the Vanguard mutual fund company, has made more money for his shareholders than the entire hedge fund industry could ever make for their investors—mostly because the hedge fund guys keep a large portion for themselves.

BL: How long did it to take you to write Wealthfulness: Simple Steps to Financial Health and Happiness?

LA: It took me three years (on and off) to write something I was comfortable showing my publisher. Then, it took another two years to rewrite the book and feel comfortable showing it to my editor. I'm shocked they didn't give up on me.

Books write themselves to a large degree. A favorite author of mine, Peter Bernstein, told me in an interview that he always learned something unexpected when writing a book, and that new pieces of information often led to a different direction for the project.

His books were typically non-fiction finance. Peter was not the typical "favorite writer" for most people.

BL: What is the "wealthfulness" approach?

LA: When I finally started working with my editor at Brown Books, she naturally wanted to work toward a how-to book. But from the beginning, I was adamant that it would not be that type of book. There are so many investing books with some strategy to get rich, become a millionaire, or quit your job.

We need a new discussion and a new paradigm. Money does not translate into happiness for most people in an advanced economy like ours. Money is also a terrible measure of wealth; it doesn't factor in family, health, friends, or life's purpose.

Wealthfulness isn't necessarily a specific type of approach; it is an awareness of the breadth of our challenge to find happiness, peace of mind, and purpose. Make no mistake—a lack of money is connected to all of the great things I mentioned. However, getting more money will not add much to the equation. Money can reduce the friction in our lives but won't necessarily add to our happiness.

My point is we need to stop obsessing about investing and start adding real value to our lives through thoughtful, long-term planning and a reassessment of our priorities.

BL: What was your main goal in writing this book?

LA: My goals in writing this book were to express my frustration with the current state of the financial industry and to offer an alternative perspective. During my 20 years in the business, I have not seen any correlation between money and happiness.

What I have seen is when people pivot away from measuring dollars and focus on purpose, other people, health, and experiences, they often see a profound effect on their happiness and peace of mind.

Time, training, and temperament are the biggest struggles. I'd like to add another one; we are now dealing with a level of consumer temptation my grandparents didn't face. If I had to put the challenges for someone today, I'd say the greatest is time, followed by temptation, temperament, and training. Training is last because just about anyone can reach a level of knowledge sufficient to manage their finances.

Notice that I say they can reach that level. Anna Maria Lusardi and Olivia Mitchell have been researching financial literacy for years, and the data is not encouraging. We must have a financially literate society in the 21st century if we want our children to see a better future.

Time and temptation are the primary hurdles. It takes time to address your financial issues. We don't have pensions, inexpensive health insurance coverage, and single-earner families like the previous generations.

Today, the typical two-earner family faces endless questions about their investing, healthcare, taxes, student loans, etc. Added to those stresses, we have easy access to credit, sophisticated marketers vying for our attention, endless choices, and annual upgrades to our favorite technology.

The temptation to out-spend our income is powerful and incessant.

BL: What future plans do you have to promote wealthfulness?

LA: Five years ago, I didn't set out to write this particular book. I feel like I found this message waiting for me once I started, and the message is far larger than just this one book. I want to redirect the discussion about financial planning, and I want to see a revolution in the investing world.

I see a future where most people spend little of their time investing. Investing is more like science than art or magic. Investment should be dull, consistent, and inexpensive. On the other hand, financial planning should be taking up more of our time, so focus on emergency savings, wills, enough life and disability insurance, and keeping your expenses below your income.

Technology is going to be a game changer. With real-time feedback on spending and saving, consumers can start making better short-term decisions that improve their long-term financial situations.

There are great budgeting tools out there now that take minimal effort. On the investing side, we also see fantastic improvements. Lower costs, broader diversification, and greater fee transparency will all lead to a better long-term investing experience. In the book, I talk about the concept of a "nudge" where systems improve outcomes without taking away anyone's choices.

The best example is with 401k plans. Some plans now include an option to increase your contribution rate annually or when you receive a salary increase. This option allows you to pre-commit to your long-term goal of more savings because we know when that pay raise comes it's not likely we'll get around to upping our contribution to the 401k.

We're expanding our website, Wealthfulness.com, to promote financial education and provide tools to help people get better at managing their finances. I'd like our website to be a resource for consumers as they start the process of wealthfulness.

Lance Alston is the founder and president of New Dimensions Wealth Management, LLC and the author of Wealthfulness: Simple Steps to Financial Health and Happiness (Brown Books Publishing Group). He holds a master's degree in economics from George Mason University and a bachelor's degree from The University of Texas at Austin.

As the co-host of a personal finance podcast (2005–2008), he interviewed a wide range of guests from the fields of economics, finance, and public policy: best-selling authors; members of the Cabinet, OMB, Federal Reserve, and Congress; and a handful of Nobel Laureates in Economics.

Lance has helped over 500 families create customized financial plans for their futures during his 19-year career. Those experiences have taught him a few important lessons: uncomplicated solutions are usually best, the investment costs are very important, and money isn't everything.
In his free time, he enjoys traveling with his two daughters, Claire and Olivia.

Brooke Lazar is WITI's content manager and digital editor. She has a BA in professional and technical writing from Youngstown State University.

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