Is This Too Much Information? – Episode 186

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[00:01] Welcome to the Prosperity Podcast, fresh alternative personal finance talk for independent thinkers who prosper outside of Wall Street. Here’s your host, bestselling author, Kim D.H. Butler and No BS Money Guy, Todd Strobel. Hey everybody, welcome back to the Prosperity Podcast. This is No BS Money Guy, Todd Strobel. We have our co-host and president of Partners for Prosperity, Kim Butler with us today. And today we’re really going to be kind of talking about an industry trend that I don’t see it stopping anytime soon. And kind of the question is, is how much should your financial institutions know? The ability of computers to collect and categorize information, it’s incredible. I mean, sometimes it’s nice to get a birthday card, but just how much should a financial

[01:01] institution be able to collect and know about you? Welcome, Kim. Well, thank you, Todd. It’s a good question. I don’t know that I have a good answer for it, but I have another area to share as we head into this discussion where just an astronomical amount of information is being collected and it’s the health arena. So as an example, my husband does his annual checkup with his physician, who’s a pretty good friend of his, and the questions that the physician had to ask and answer for Todd on whatever form it was to get whatever insurance company to pay whatever was appropriate. This was just a basic checkup, nothing unusual at all, nothing anything he hadn’t done before. Boy, were the questions unusual, invasive, and from all over the board, I mean, things

[01:56] that we really wouldn’t think could have an impact on your health. I guess if you dug deep, they might find a way. I mean, it was things like ownership of arms. It was information about coffee drinking. I mean, it was just all kinds of things. So I haven’t done a loan application in a while. Whatever I do, and I have to call my bookkeeper, Carrie Putnam, because she knows way more about the details of our finances than I do. And if somebody says like, oh, you know, your average cell phone bill or something like that, I never know those answers. So thankfully, Carrie looks them up. But Todd, you were talking about them even using cameras to determine like eye movement and figure out if you’re lying.

[02:40] Well, there was some research that’s done. And I don’t know that it ever came out, but there are physical cues that you have that I guess maybe if you’re trained, you wouldn’t apply to you. But you know, your eyes dilate a certain way. You look a certain way. Your respiration does a certain way. And they were actually able to have people fill out loan applications, some of them intentionally lying, some of them telling the truth. And they have the technology now where they could analyze whether or not you’re lying on a loan application while you’re filling it out, not research behind the scenes, but actually while it’s happening. Yeah, that is amazing. And I know Bingham America and Merrill Lynch with their aging apps where they’re taking

[03:35] of you and then using computers essentially to advance the photo so that you can see what you’re looking or going to be looking like 30, 40 years out. I think it’s 30 years out, you know, makes you wonder like, OK, what else are they doing with that picture? And, you know, of course, they’ve got the fine print at the bottom. But something that strikes me as we talk about this is I’ve always indicated that the financial institutions products that are out there. So it could be your savings account. It could be your mortgage. It could be your life insurance policy. It could be, you know, whatever the product is that you get from the bank, the insurance company, the loan company, et cetera. That’s one thing.

[04:17] And then the strategy that you use with that product is another. So the strategy has to do essentially like with which box you check. So, for example, on your life insurance policy. Well, with your dividends, you actually check a box telling the financial institution what you want them to do with that dividend. Do you want it to buy pay to petitions, which is what most people do, especially in the early stages. You could also have that dividend paid in cash. You could have that dividend help you pay back your loan, et cetera, with your savings account or your mutual funds. And I’m not talking IRA money here, just regular. You can reinvest those interest payments or those capital gains payments,

[05:03] or you can have them paid in cash. You know, that’s an example of a strategy is you’re going to check one box or another box on the same product. So two identical people could have two identical products. But how those products look, act and operate long term is impacted by the boxes that you check. And I’m wondering as we progress here in this era of computer knowledge and artificial intelligence and tying together of habits for proof of things, if all this is just potentially, you know, we’re not making a political statement here, but just having a little bit too much big brother. And yet on the other hand, could it really value us? So, for example, in the life insurance arena, if I have really good habits

[05:58] around my health and I drink water and I exercise and do, you know, a series of things that is supposed to contribute to my health, then that could generate better life insurance premiums. I would be willing to trade information for that kind of benefit. So I think then you have to ask the other question. Well, what kind of information wouldn’t you trade? And what price would you be willing to pay to not trade that information? So I’d like to pose these questions to our listeners. It’s not like you and I have the right answers on them. Help me frame these in a way that people could respond easily. Well, think think of go back to our banking example. You know, if they could tell which. Clients were lying on loan applications.

[06:55] Obviously, the default rate of the bank has to be factored in to the interest rates that all of the paying customers pay for, correct? Right. So you could get a lower interest rate if they were able to reduce the amount of fraudulent applications. Now, the question is how much, you know, how much is too far? In other words, you know, I mean. You know, would you be willing to fill out a questionnaire on your sexual habits, which could or could not have a bearing on your health? Absolutely. Yeah, it’s a really good question. So I turn it over to you, the listener. I’d love to hear your thoughts on this. Send us an email. Hello at partners number four prosperity.com and tell us questions that you’d be willing to ask in order to get a better deal.

[07:54] Well, we’ll just pose it that way. Like what, sorry, questions you’d be willing to answer is the way to put it. What questions would you be willing to answer in order to get a better deal on whatever it is? It could be your mortgage. It could be your life insurance, could be your car insurance. It could be, you know, some major purchase that you’re like an actual car, something that you’re pursuing. What question or what kind of information would you be willing to provide to get a better deal? And we’ll, we’ll do a report back on this in a month or so when we’ve collected some of the answers. That’ll be fun. Now, here’s something that has just come out and it has been confirmed, but anyone with a smart TV, the technology exists for the

[08:42] government to watch you watching TV. Yeah, that is scary. Uh, you know, I knew I didn’t watch TV for a reason. I mean, to me, I mean, we’ve taken big brother too far. I mean, if you think of the people who fought and died to have their own private life, how much of that is still left? I mean, what would, what would, you know, somebody from 200 years ago say about what they’re looking around? I mean, I got my first traffic ticket, I guess a couple of months ago from a machine, I was driving a rental car at a time and the red light itself took my picture and gave me a ticket. Did you know they can do that? Yes, yes, I was aware of that. I actually lived for a while in Scottsdale, Arizona, which I think was one

[09:35] of the first that came up with the photo cop idea and, um, would issue speeding tickets and they would just show up in the mail. So how did you get the physical ticket? Like, how did you know you got a ticket? Well, it took forever because they had to trace it back to the rental company and then when you sign the rental agreement, it specifically says any tickets, then it showed up in the mail. Yep. So, well, here’s another one that’s interesting in this category of how are they collecting information and is the information helpful? Um, my husband just showed it to me today on Amazon. They have, and I can’t get the name of it. I guess it’s part of their Alexa program. Um, they have an item that you put on your counter, like in the

[10:23] bathroom or your dresser and you say, Alexa, take a picture and she does that. And then, and this is when you’re clothed, by the way, I should have said, um, so, um, then she can up, you can choose to help have her help you upload that picture and get advice from people as to like outfit A versus outfit B or, you know, does this look good on me or is this shirt better than that shirt with these pants? And then you can take it further into some shopping apps and into some, um, you know, mix and match and clothing, um, inventory management, if you will, um, so she went so far as to, um, literally show a picture of where somebody kept track of what they wore every day, which I guess if you were

[11:10] in the public eye a lot, that would matter and you would need to make sure that you weren’t wearing things over, you know, too close, what have you. It’s just kind of weird, the amazing things that are coming up with. And yet, as people, I think have heard us say before, I’m so adamant that there’s good in technology, so we need to find the good and we need to look at what it can do to help our lives. And I guess if how you look every day is super, super critical, then that could be a helpful app. I personally wouldn’t choose to use it, but isn’t that the beauty? This is a miracle. We don’t have to use things that are available. And so if they upset us, we can turn our attention elsewhere or we can learn from them.

[11:49] You know, maybe there’s some cool new service that somebody can think of just because they don’t like service A. Maybe they can think of a better or an improved version of it. And in today’s open source world, you could actually contribute to that and have a say in how products are being used and information is being used. So it will be interesting as we march forward to see what the financial industry does with the information that it’s collecting from its users. One of the things that I am super excited about is the opportunity of the blockchain and the blockchain is a place on the web where trust is verifiable. And so you could almost think of it like an escrow company that can enable trust between two parties to be established very quickly.

[12:42] And it can monitor the progress of a transaction, secure payment, disperse funds when appropriate and hold them when not appropriate, et cetera, et cetera. So if you haven’t done any research on the blockchain, more and more articles are coming up on it. I cannot wait until we can figure out a way to get a whole life insurance company on the blockchain, because to me, that’s the ultimate of empowerment to us as individuals, because life insurance companies, the ones that we typically talk about are mutually owned. That means the policyholders own the company and when it’s put on the blockchain, that means everything is transparent, not individual people’s information, of course, but how the company runs, what it does, what it

[13:31] invests in, how it’s paying claims, et cetera, et cetera, et cetera. And I’m super excited about the potential that the blockchain is going to have to increase the efficiency and the effectiveness of all types of financial companies. But I just think the whole life style company, the mutual life insurance company is going to be one of the most natural first ones again, because the policyholders own the company. It’s not like there’s outside external unknown shareholders like are in so many other companies. I’m sorry. I’m still focused on the camera. That’s all I can think about. I mean, 80% of men are going to buy these for women because they would never have to hear those dreaded words. Does this make me look fat?

[14:20] That’s right. There is no correct answer. And if some computer could answer that, it wouldn’t matter what it costs, I would sell a house to get one of those. That is funny. Well, you’ll have to go check it out. It’s part of Amazon’s Alexa process. And I will admit we have three echo dots in our house. One, actually, I think four of them, one in a variety of places that’s helpful and she adds things to the grocery lists and turns off and on the lights, et cetera, et cetera. And it is very helpful, but I don’t think I will be buying the camera. So maybe that’s the next question we should ask our listeners is, are you going to buy an Alexa camera or not? Awesome. Well, I hope the listeners enjoyed this as much as we did.

[15:12] And again, we really look forward to your feedback because I mean, this is a wide open area that has so many possibilities and implications. I don’t think any of us together could possibly even predict what’s coming. So again, this is No BS Money Guy, Todd Strobel. Special thanks to our listeners. Thanks to Kim Butler. And we’ll see you all again real soon. Thank you for listening to the Prosperity Podcast to take control of your money and have it work for you. Visit us at partnersforprosperity.com. If you liked this episode, make sure you subscribe and leave a review.