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Well, Emily, typically investing for retirement goes like this. When you're young and you have many years to work, you primarily own volatile assets like stocks. Only a small portion of your portfolio is bonds. Then as you get older your portfolio grows, that allocation changes, and when you get close to retirement a lot more of your portfolio is bonds. Then it's stocks. That's the conventional wisdom. But our next guest says that's not enough for today. Salkapezi is executive
vice president at Dunham Dunham in Associates Investment Council. He joins us here in the Bloomberg Interactive Brokers Studio. We talk a lot about the idea of conventional wisdom for retirement being broken. But what specifically do you see not working today and why?
Well, it's what we called the retirement in investment paradox, right, and it's exactly what you just described. So when I came into this business, our asset allocation was basically what they called an age based allocation. Here's how it worked. If I was twenty years old, I had a client twenty years old, that means I put them twenty percent in bonds eighty percent in stocks. That sounds they got older, right, Yeah, So are at thirty years old now they have thirty
percent in bonds. By the time they hit age sixty five, they would be sixty five percent in bonds thirty five percent in stocks. And that worked for us because there was one risk that we were trying to mitigate, and that was sequence risk. What we didn't want was for them to hit retirement in a bad market and suddenly find that their entire retirement portfolio basically was blown apart. So that's all we were concerned about because at age sixty five back then, we knew they had maybe ten
to twenty years left in retirement. Today ten twenty years before they died, correct before they write before they passed away. So what we're seeing today is a little bit different because what we're seeing today is there are three major risks. There's inflation, there's the fact that we're living longer, and their sequence risk, and a financial advisor now has to
balance those type of those risks. Back in the late nineties, there was a major Boston asset management company by the Great Big Dick for your new listeners out in Boston, and they had a big billboard. As you were sitting through traffic, you're watching this billboard and what it said was that the first person to live to be one hundred and fifty years old is alive today.
It is.
It's not a common right now where we know that there are people that are over one hundred years old. I know three different people that are now over just one hundred years old.
My grandma turns one hundred and two next month and I just visited her over the weekend and she's doing fine, right, I mean she's one hundred and two. Yeah, she's still she still definitely has some of her snappyness.
Does your own crypto and leverage video?
No, none of that going on.
So where do you where do you focus now? Is this a change because of this paradox? Is this a change that like young people are adding more risk assets or you're focusing more on that sixty five and up age group and changing that portfolio.
It's the sixty five on up because that's where we have the paradox. Because if we're livid logger. Right, how do you what you needed your portfolio was growth? Right? Stocks tend to give us growth if you try to
battle inflation. Right, And even if the FED hits its two percent target, the compounding effect of two percent inflation for you know someone who's one hundred and two years old, right, What it basically means is that that if I retired, Right, I'm sixty five, and I go to the supermarket, and there are twenty five items that I purchase, right, and I purchase those same items. So it's bread, it's milk, it's vegetables, it's fruit. I purchased the same items every
single week at a two percent inflation. By the time I forty years later, right, I have to take thirteen of those items out of my basket and leave them at the supermarket, leaving what just eleven or spending a lot more. Right. And so the paradox is what, so what is the asset class that is best to handle inflation? Well, it's equities, right, It's great job over the years of combatied inflation. But what is the one thing if you take a look at sequence risk? Right, and this is
the paradox. What causes sequence risk. It's if you live too long equities.
And if you are in a portfolio where there's a lot of volatility, your part portfolio can go down for a number of years and you don't have that money.
Correct SOT And if you go and if you tried to combat sequence risk, what do you do? Then you look at less viol so you do bonds you do or do what ease? You might do bucket strategies, right, but if it's too conservative, now you don't have the growth to combat the inflation and livy longer. That's the paradox that that we're facing.
So what's the answer here? And also just are we doing it wrong with these target date funds because a lot of times, you know, we don't have many options when it comes to investing in retire for retirement. When you have a four to one K with a company, for example, throw it into target date fund. These things are made for catered for a certain age, right.
And the question we have to ask ourselves, and we ask ourselves this question at DOT them is are those the right investments going forward? So if we are going to be living longer, right, then is that the right strategy? Do we really want to be in bonds at the end, or do we as an industry have a responsibility to find new type of investments, a new type of overlays that we might be able to have that can combat sequence risk and perhaps give growth.
What are some of the options that are out there? So at DOUTA we have an option there.
So this is something that we've been working on, right, this is something that we've been working on for a number of years now in terms of retirees of this concept that we need to be thinking differently. So we have a strategy where basically we're buying fear and selling greed.
Right.
So it's inspired by Warren Buffett, right, the famous quote be fearful when others are greedy, be greedy when others are fearful. Right. So what we're basically doing is we're taking a look at at the price of equities. Right. As prices go higher and as investors are willing to pay more, we based on an algorithm. It's math, right,
it's math at time. Right, As as they're willing to pay more, we are selling them the equities when the when the market starts to turn and I should stop hitting that microphone, I guess so, so when the markets turned right, then then and and and and people start panicking and they're selling equities at lower prices. Then we're buying. But here's the key. What that means is this. That means at the top of the mar you own less equities. At the bottom of the market, you have more equities.
So what you're attempting to do, what you potentially could accomplish, is mitigating that sequence risk, but at the same time you now have the growth.
But timing the market, we're told is a fool's errand how do you do it?
So we're not tiping the market. We're simply looking at the price of the market. We're not trying to pick the top, we're not trying to pick the bottom.
But you're preparing a portfolio to react to situations that include the top and the bottom.
Yes, so a little bit different, right. So Number one, it's an overlay. So we have our asset allocation program that's been doing this for almost forty years, right, So this is simply an overlay that we placed over our regular portfolios that we manage specifically for retirees, just to help them in this sequence risk and this growth that they need. So we're not trying to protect anything. It's simply math. Right, So hypothetically right, this is not how
it works. But you could say, ver tide the market moves five percent higher, we're gonna sell, right because we can get a better price. Ver Tide the market dips, right, and it dips by five percent, will will purchase equities. Right. It's a little more complicated than that the overall algorithm, but it's not much more complicated. We're not using AI, we're not taking forty two different factors into account. It's simply math.
We only have about a minute left. But in your opinion, what's the best place to get income from? Because that's been such a hot theme in the last few years, and I know that retirees like to have an income stream.
So the so equities provide it. Started markets a to prevent this amount of income through there evidens, But clearly right now bonds are a place to receive income.
Right.
The problem is that is going to start vanishet in a couple of weeks as the VET starts lowering rates, we're going to be back to that market again. And that's why at Dunham what we do is we take a look at retirement and we try to create for our financial advisors that we work with, we try to create a process for them to be able to accomplish the income that they that the client needs, but also to be able to work hand in hand to get that growth, and we do that through this algorithm.
Very interesting stuff, soal thanks.
For joining us.
It's my pleasure. Thank you for having me.
Salkapezi, Executive vice president at Dunham and Associates Investment Council, joining us here in the Bloomberg Interactive Brokers studio.
When we talk about.
Fertility, IVF, i UI, it's a really hot button issue in politics right now, but some and people have different views on how they look at it, and a lot of people in different parts of the country have different views on it. But you can't argue with the way things are going and the stats out there. According to the American Society for Reproductive Medicine, the number of babies born from IVF increased in twenty twenty two to ninety
one thousand, seven hundred and seventy one. That's up from eighty nine thousand, two hundred and eight in twenty twenty one. In other words, according to the ASRM, two point five percent of all berths in the US that year were the result of successful assisted reproductive technology cycles. Somebody who watched this closely as Shelley McConnell, chief strategy officer at
Win Fertility. It's a company that works on family building, they work on IVF, IUI, and they provide support around those things and full disclosure, I believe it is a company that Bloomberg uses in its benefits. Shelley joins us from Greenwich, Connecticut. Shelly, good to have you with us.
How are you hi, Thank you for having me. I'm happy to be here.
Well, thanks for joining us. It's interesting to see these numbers because I'll be honest with you, ninety one thousand berths from IVF or IUI. That seems low. I think if you live in a city and you're of a certain age, a lot of people you know have gone through IVF for IUI or other assisted fertility. I'm wondering from your perspective, why you think it's grown so much in such a short time. Is it because we're all having kids when we're older.
Now, that's one of the factors, but it's not all of the factors. In fact, when it comes to infertility and pregnancy loss. Historically, women have held the stigma and the burden, the financial burden, the mental burden, the physical burden of treatments and testing and monitoring. But what we know now is that male reproductive health contributes to infertility as much as female reproductive health. So men and women fertility does decrease as we age, but that is not
the only factor. There are a lot of environmental factors and undetermined factors as well.
What is WIND doing when it comes to these male fertility treatments, Because I agree with you, you don't really hear that much about the treatments that men can undergo for infertility, right, Yes, it's.
Very important for men early and comprehensively to be tested. Anything that can interrupt their hormone levels can impact their fertility. So in some cases there are actual procedures to help. In other cases they are medical interventions, and in some cases there are drug protocols that can help.
It's so interesting when when you hear about the idea of reproductive techniques, you hear a lot about egg freezing. What I have not heard about is sperm freezing. And I know thanks to our producer Paul Brennan, who sent us some notes ahead of time that about a third of your clients are offering elective sperm freezing services. That's right, talk a little bit about that.
Sure, you know. We're actually seeing this increase in popularity from a few perspectives. One is some acknowledgement that male reproductive health and fertility does decrease over time, and so having sperm preserved is something that's becoming a little more popular, although not nearly, as it's not experiencing nearly the boom
that egg freezing has been experiencing. The second is that often when someone is about to undergo a medical treatment that would negatively and significantly compromise their fertility, they choose to preserve sperm for future use. An example would be certain cancer treatments where they will likely be rendered and fertile as a result, they may preserve it for future use.
And the third would be anyone who would be going through gender reassignment should be offered the opportunity to preserve egg or sperm prior to undergoing ormone treatment.
So the sperm freezing is that cheaper than egg freezing.
Yes, it is much cheaper than egg freezing. Egg freezing might be ten to fifteen thousand dollars. That can depend on where you are geographically and how successful the cycles are. For men, all in it is is maybe seven hundred and two one thousand dollars.
What do we know so far about the success rate in that kind of procedure, because with egg freezing it doesn't always work.
No, that's true. And for men, collection of sperm is much more straightforward and much easier, and so that is that tends to be more successful. What we would have concerns about it's not just the quantity but the quality
of the sperm. And so we know that in mail infertility, both the quantity and quality of the sperm are impacting fertility, and so making sure that the quality of the sperm is very good and has minimal a fragmentation and other things that can negatively impact fertility and pregnancy loss.
I'm wondering about Shelley, the idea of low testoster and how from your position at wind Fertility you're looking at this phenomenon that we're seeing.
Yes, significant male testosterone levels typically drop off annually from age thirty and above, and can do so quite significantly from the age fifty and up. About twenty five percent of men report adverse symptoms associated with the decrease in testosterone and what is called Andrew pause, and very many report that it impacts their work and their ability to
perform their work functions. So it actually is something that has not been well publicized or discussed to the extent that it should be, but has a significant impact on male health.
Is Bloomberg Business Week with Carol Messer and Tim Stenebeck on Bloomberg Radio and Television.
It is Bloomberg Business Week. Let's get back to our conversation with Shelley McConnell, chief strategy officer at Wind Fertility, joining us from Connecticut. Shelley, Emily and I were talking and you mentioned something in our previous conversation that really piqued our interests.
Yeah, so you had said that there were certain environmental factors that impact male infertility. Go into some detail on that, name a couple of those factors and what people should be watching out for.
Well, there are certainly kind of the age old things that we know about, particularly around temperature and keeping cools. Some things like boxer shorts are preferred over briefs, but men who exercise excessively, which some do can sometimes elevate temperature and have a negative impact on sperm. But there are also environmental factors like microplastics that are believed to have an impact. Anything that could disrupt hormones will will
impact sperm production again, quality and quantity. So things like the rise in insulin resistance in our population, as you can see in pre diabetes and diabetes going up so much, particularly in our younger generations, that can have an impact on fertility. Any endocrine disrupting chemicals in the environment can also do so. Microplastics are everywhere.
Yeah, that's well, that's what I was going to ask you. It's it's so interesting to hear you talk about this because this is not something this is relatively relatively new phenomenon. I mean, we used to like microplastics. You know, there used to be soaps I think that had microplastics in them just so they'd have like abrasive qualities and those that would obviously get into the the sewer systems, like pretty terrible stuff in hindsight, in retrospect, what should people
be doing to to mitigate somebody? This stuff is everywhere.
This stuff is everywhere. And I was reading recently about a study where they were trying to impact to assess the impact of microplastics on male reproductive organs, and they couldn't establish a control group. They could not establish a group that did not have the presence of microplastics. So I think there is some about being careful of your environment, but there are things that we all can control more around healthy diets, healthy living, stress, maintaining reducing sugar to
not impact your insulin levels, and so forth. Those are things that you can control, and we would suggest, as I mentioned, that if you're going through this process, for all men to be tested early and comprehensively so that they could potentially be treated. Another factor is that people don't always have access to urologists. Sixty percent of counties in the US have no urologists, and more than ninety percent of urologists are practicing in metropolity.
You say, what percent of counties in sixty counties in the US don't have eurologists percent of counties sixty percent?
Oh my god.
Yes, So sometimes virtual care is very part. They're very concentrated in the metropolitan areas. Tim That maybe goes a little bit to what you were mentioning. At the beginning, but having access to virtual care, it can be very important for people to be able to access urology and urologists.
Is our fertility benefits seen as baseline these days.
Yes, very much so. It's an expectation of employees and for the most part, employers have agreed, although the fact that the figures can vary, but somewhere between forty and above fifty percent of employers offer fertility benefits in some capacity, and I expect that that will be much higher in the very near future. It is it's a business imperative, it's an expectation from an employee recruiting and retention standpoint.
Hey, I mentioned politics at the top of our interview. There was a you know, the there was a February sixteenth decision that meant anyone who destroyed embryos could be liable for wrongful death. And this is in Alabama. They passed a lot of protect IVF treatments after this embryo ruling. How do you watch what's happening politically now in your industry, Well.
We watch it very closely. It's impossible to predict what is going to happen. In a lot of places. We are short on details as to what is being proposed and what may occur. Nonetheless, the elevated visibility of this topic across both parties and both campaigns points to the fact that this is so important for people to have access to these treatments. We continue to watch and we would suggest that businesses offer comprehensive benefits that include independent
clinical guidance for people. This is a very complex clinical experience, but it also is a complex legislative environment, and understanding and having someone who can help guide you through this process is what is helping so many people through and to the other end of success.
Shelley, thanks so much for joining us on Bloomberg Business Week. Shelley McConnell is Chief Strategy Officer at Win Fertility. They do family building and family well being benefits for companies, including full disclosure here at Bloomberg