Content transcribed from podcast “Wealthworx Radio with Eric Kearney“, Episode 100 – Advice for Those Over 70 and Still Working (Listen to this and other episodes on Google Podcast)
Coming up on WealthWorx Radio. On today’s show, there’s a growing number of people that are still working in their seventies. If that’s you or if you plan to keep on working, we’ve got three important things to know about working over 70.
And now WealthWorx Radio with Eric Kearney.
Hey, welcome in everybody. This is Wealth Works Radio with Eric Kearney and Joseph Land. I’m consumer advocate. Steves at all. Eric is a fiduciary. He is president of Retirement Wealth Advisors LLC of Cape Coral. Joseph also a fiduciary, hanging out and, uh, offering his guidance to folks getting to retirement. Hey Joseph, what’s going?
Hey, Steve. It’s officially December, so we’re full Christmas time now. Well, yeah, we’ve got the, uh, you know, all of the fun stuff, right? Yeah. Yeah. Does that include retirement? For some ? That’s what Santa’s bringing for some people. Retirement’s a great gift. Yeah. Yeah. I love that. So Eric, um, alright, so working in our seventies, this is not an unusual thing anymore.
I mean, it’s not the norm necessarily, but it’s certainly not unusual. What differences are there? It it, well, it comes with some hurdles, you know, I mean, uh, financially speaking, you know, we actually took on a, a client who was still working in their seventies and, uh, you know, his ad his past advisor actually had him roll.
His current plan. And I said, why would they do that? And he goes, well, I don’t know. She said it was best for me. I said, well, the problem is now, even though you’re still working and you’re 72 years old now, you still have to take out required minimum distributions. And if she left it in the 401k, which
They should have done, um, they wouldn’t have had to do that. So you have to be aware of your required minimum distributions in your rollover plans. Now, if you still have money in a current 401k, you do not have to do that. And so, like I said, there are financial hurdles with working a little bit older.
You know, you got to take a look at your social security, you got to take a look at your Medicare. Um, there’s a lot of moving parts that, that go into this. So I think that this will be a good show for people that, you know, want to continue to work and, and think that, you know, it’s not going to be as easy as it is
Well, Eric, I, I’m confused. So now, if, if this financial advisor advised this person to take their money out of a 401K and into an IRA, some cases, that makes sense, but in this case, to avoid the RMDs, because he’s still working. Why didn’t she know that? I don’t know. I mean, either she didn’t know or she knew it and it was for her own benefit because obviously she wants the assets under management.
So, um, either way it was wrong and um, you know, and that’s why, you know, and I’ve said this time and time again, I don’t know who’s more frustrated with the financial industry, me or people out there. And you know, when you see things like this, this is why we’re going to stay busy till the end of time because literally, There’s a lot of, look, there’s a lot of very good advisors out there, and I always say that, but there’s also a lot of people out there who are licensed sales people, and they do not understand the ramifications of making decisions for a client.
And the ability to be able to forecast a financial decision is something that you really have to take a look at. If you’re just looking for the here and now, and quite frankly, I’m not interested in. Making someone happy today. That’s that instant gratification I’m looking at knowing that you’re going to have more than likely a sound financial plan in 5, 10, 15, 20, and even in 30 years.
So the instant gratification doesn’t do anything for me. The market’s going to move, the market’s going to be volatile, interest rates are going to be all over the place. I don’t care about the here and now. I care about long term. And so, you know, understand that long term returns are the only ones that matter.
But unfortunately, Life is lived right now, and so that’s where the majority of people worry about. But again, you’ve got to think about everything and forecast all of these decisions to see what financial hurdles you’re going to encounter and how to avoid them. That’s a great comparison in terms of the right now versus the big picture, you never lose sight of the big picture.
He can’t. And you know, it, it’s funny too because people say, oh geeze, Eric, you think of everything. Well, it’s, it’s my nature because I am a planner. And so the thing is, is that we’re constantly looking in the future where, you know, today is today. Um, everything’s going to be over today. The sun will come up tomorrow.
You know, we’re going to get through day to day, but you really have to focus on your long term goals and, and objectives and, and understand that, you know, more money, more problems, which means more strategies. Sure. But that’s what you do. I mean, in terms of, you know, what you do at Retirement Wealth, is that the strategies that you implement that you can see that make sense for somebody but not somebody else?
I mean, again, those, that, that’s such a key part of. And I think that that is the one thing that our clients really enjoy about us. We are strategic, we’re always thinking, we’re always on our feet and thinking about new ideas and, and implementing different financial strategies to compliment that client. And a lot of times, you know, we have to have tough financial love and say, look, I know that you want this, but you’re just not able to do this.
Right. We can eventually get there and people like that we’re eventually trying to get there. It just may not happen overnight. And um, and, and the other thing is that people really appreciate about us is that we’re realistic. I mean, we truly have to be realistic about timeframes, about your risk tolerance, about how much money you have, about your amount of.
Withdrawals. I mean, some people are just taking out an exuberant amount of money, and that’s where I have to step in and I’m like, look, this is not sustainable. And, you know, it’s, it’s me that has to say that early on because, you know, I, I would rather do that than have the client, you know, be in a bad position down the road.
And you have to understand too, the older that we get, the more vulnerable we. You know, and I’ve had a friend who, you know, I’ve been friends with this guy for a long time, and interestingly enough, he’s always been able to take care of his car. So on VA or on Thanksgiving, he was actually going to see his niece, I believe, hits a huge pothole and damages the rim and tire.
And the funny thing is, is you know, luckily he has aaa, but he’s just like, you know what? I don’t want to deal with this stuff anymore. So it is true the older that we get, we just don’t want to deal with this. So you want to be prepared. You want to have aaa, you want to have backup for all these things, and I think that’s pretty cool.
Uh, yes. It’s a long story. Big pothole. Big pothole is what it was. Yes, indeed. Well, alright, so have you ever run into anybody who said, you know, they’re, they’re 70 years old, uh, and they say, well, I’m, I’m going to keep, I’m not going to take Social Security just yet.
Yeah, this happens a lot because they think that they can keep delaying it, and they know that any year after their full retirement age, they’re getting an increase, but this actually stops at 70. So it’s kind of like you’re just wasting this opportunity of your social security is capped. You might as well start taking it at 70 years old.
Sure. Now, something to keep in mind is if you’re still working and you’re taking social. Um, you can actually get a decrease if it’s over $19,500 in what you’re actually earning in income. Um, so you want to make sure that you’re talking with your advisor about what your estimated earnings are and what your social security benefits are going to be, because those can be reduced if you are still working.
Um, and there’s different age limits for that, so it can get a little bit confusing. But this is something, just another piece, it’s another variable. That we have to plan for that. Donna is great at planning for, too, being a certified financial planner, there’s a lot of rules that get into social security, Medicare brackets, everything.
And this is all factored into the financial plan. Well, with that, with the whole social security piece and, uh, the potential tax, there’s, and again, there’s strategies around that in that if you wait until you’re 70, that’s great, but, but if you wait any longer than 70, well then, you know, the government’s not going to Thank you.
Right. Yeah. I mean, the money’s waiting is just sitting there waiting for you to take it. Um, and they’re not going to be like, Hey, don’t forget, you know, you still have this social security, right? You have to be on top of these things, and you have to understand when you need to start taking them because, No one in the government is going to hold your hand for you to take their money in their eyes.
Right? Right. Exactly. So, I mean, so does that, does that factor in in terms of when you take Social security and, and you’re still working, does that factor into the overall plan? In other words, to avoid taxes on social security? Of course, yeah. It’s another strategy within itself because a lot of people will blindly elect social security or, uh, keep working and they’re not factoring in a lot of these different key metrics that we’re looking for, and it can greatly affect their plan.
So like I said, all these variables go into play with the financial plan, with the strategy, and a lot of times if there is a new hurdle that comes. Then we can create a new strategy for that. As, like Eric said, we’re always thinking because everything’s always changing, right? Or external environment’s always changing and your plan should be as well.
Well, let’s talk about taxes then, because that is the key part of any good retirement and income plan, and because of RMDs, there’s any number of factors you could find yourself in a tax bracket that is going to be a surprise to you, and that won’t be a pleasant. Yeah, I think a lot of people actually when they, they think about retirement and they think that their tax bracket is going to be a lot lower than they were when they’re working.
But this is a huge misconception that we see a lot, and a lot of people keep spending the same amount that they were while they were working as they do in retirement. And retirement isn’t necessarily tax free. Social security is taxable up to 85%. If you have pensions, those are normally taxable. And if you have a 401ks or ira, some people even say that’s only 70 to 80% of your money because the government owns the other 20 to 30% due to taxes.
So you have all these different things that are taxable income to you. Um, and not to mention, we’re in a relatively low tax bracket right now. That’s sun in 2025. So if we get bumped up into a higher tax bracket and all your income in retirement is taxable than just like what you just said, Steve, you could be in a much higher tax bracket than you are today.
And if you’re not accounting for that in your financial plan and you’re just assuming everything you pull out is what you’re going to net. You could have a rude awakening once you get into retirement and you realize, oh, now 30% of all my income that I’m taking out is going to the government, I actually need to pull out X amount of dollars to keep my lifestyle sustainable.
Well, yeah, exactly. And so again, if you, if you’re thinking about retiring, if you’re thinking about social security, you’re wondering about how all those pieces come together. Well, that’s what you do. Yeah, that’s actually what we’re looking to do. I mean, in every single financial plan, we’re covering everything from A to Z I mean, and you want to think about your financial plan, like financial triage.
Basically, when somebody comes in, what are the top three things that we’re really looking at to be a major concern? And if we take care of those things, then we go down to the fourth thing, then we take care of the fifth thing. And a lot of times somebody’s, you know, worried about their portfolio, but maybe it’s not the portfolio, maybe their taxes.
Out of control. And so it’s like we’re really highlighting what the issues are and what we’re going to have to take a look at. And a lot of people are very thankful because they’re like, geez, I had no idea that that was such a situation for me. Well, let’s get folks on the line. Let’s, uh, let’s have folks come on in and have the conversation and get things cleared up.
Whether you currently have an advisor or you’ve never worked with a financial professional before, we’re going to be taking the next 10 callers who are in need of that missing financial plan. We’re going to create and customize a Fullblown financial plan, review value to over a thousand dollars and give it away, absolutely complimentary, no obligation.
What this will consist of is simply taking the mystery outta financial planning by taking a look at what you’re currently doing and maybe just making some slight change. Let’s map it all out. Your goals, income needs, expenses, tax strategies, and even transfers generational wealth. We will get that plan built for you and see where it leads you.
Let’s get you reacquainted with your investments without any obligation. In short, we’re going to take the guesswork outta financial planning. So for the next 10 callers, a full blown comprehensive plan review that is valued over a thousand dollars. We’ll be giving it to you, complimentary with no obligation.
Sounds like a plan. Great idea, folks. 807 7 9 1 9 4 2. That’s how you can get the ball rolling. It’s an opportunity to get a financial roadmap put together. No cost, no obligation. You hurt Joseph. The next 10 callers, we’ll get that comprehensive financial review and you walk out with a roadmap that can help get you to where you need to be when it comes to retirement.
We are back on WealthWorx Radio with Eric Kearney and Joseph Lanson. I’m Steve Saidal and uh, this is. Uh, both Eric and Joseph are fiduciary, independent, uh, well, really, Jo Eric, you, you have a fiduciary firm. That’s what you do. And, and why is that? And I, I, I know I’m sort of oversimplifying it, but why is that such an important piece?
Well, a lot of people don’t understand, you know, they, they, they hear the word fiduciary and they’re like, okay, what does that mean? And, and what it means is that by license and law, We are under our ethical code is to put the, be the client’s best interest first. So you’re, you’re really thinking about what the client needs before your own interests.
And unfortunately there’s still a lot of firms out there, and I’m not going to say any names, but you know, there’s a lot of firms out there who want to be a fiduciary firm. But when you take a look at the products and the tools and the investments that are sold to them, um, you can absolutely see that.
Absolutely not a fiduciary. Absolutely not. And so when people come in, we explain the difference to them and they’re like, oh, okay. I mean, remember. Being a fiduciary, purpose determines placement. Whatever the purpose is for your money determines the placement for your investments. But how many times have people walked in and they’re just shown, you know, an investment product or an investment tool or an insurance product?
Without even doing a financial plan, without even asking what their budget is and everything. And, and it’s kind of, again, this is why I’m frustrated with the financial industry and you know, and it seems like the older that I get, I’m turning into that old man, you know, like you just sound like an old man.
But I am frustrated with the financial industry and I think Joseph’s going to get there too. And the, the point is, is that you see so many things. Um, advisory firms are disrespecting people’s money, where it came from, how they earned it, um, you know, who passed away, what was this inheritance from? Did they sell a business?
Did they literally start a business with their own capital? Did they bootstrap the entire thing themselves? It was all time that they invested in. They pulled them away from their families. They sacrificed a lot of things. They built this business over a period of years just to be able to sell it and try to. that’s the respect that you have to have for someone and their money. And so what we’re seeing is, is that a lot of people, uh, are just not respecting where that money came from. So being an independent fiduciary firm who does strategic planning, that’s the way that we’ve been built. And the other thing that I’m going to go off on a little bit is, is service.
You know, The other day I had a bunch of parts that had come in, um, for a piece of gym equipment I have that were missing. And so it took me multiple calls and many people to get this done. And one of the most frustrating things was it was when I first called the girl, I thought it was going to be simple.
Hey, I’m missing two handles. I looked all over. They’re not small pieces either. Like they’re not there and she’s like, okay, there’s really not much I can do. And I’m like, what do you mean? Like you are the company that I ordered it from. She goes, yeah, but you know, I don’t really know what that department is, but when you hang up, could you please leave a survey for me?
And anything less than 10 is a failure. good. And like, that’s the world that we live in now. Like, and, and I said to her, I go, but you weren’t able to help me do. And you want me to leave you a good review, I’m not going to leave you any review. Right. Right. I mean, and, and I, I am a strong believer, I’ve been a business owner for a long time.
Look, you know, you go into a pizza place, you can have 15 different pizzas, right? And then all of a sudden you go in there and you have one pizza and people want to leave a bad review. What about the 15 other good pizzas that you had exactly right, that you never left review for? So I’m not really a big believer on reviews, to be honest.
But the, the thing is, is that the customer service in this whole entire industry has just been unbearable for people. And so, like, people are just tired of it. And that’s where, like I said, I mean, autumn does a great job with our concierge team getting back to the client, following up on the client and, and really putting out little tiny fires before they turn into a dumpster fire.
And so that’s what people are really looking for. Like I said, I mean, we could have a whole show about my frustration with the financial industry, but again, um, it really just starts out at, at the top and, and, and you got to have people that are reaching back out to you. Sure. Well, and again, you know, as we start to put the plan together, um, we’re talking about some various ways to make sure we keep our money, or at least the lions share of it, um, by creating a floor and, and how do we do that and what does that.
I love this. So you’re creating a floor to cover all of your daily bills. Oh, okay. So there’s, there’s, there’s the hug method, which is We always laugh about this because there’s actually 2Gs at the end but it’s, uh, housing, utilities, groceries, and gas. Oh, okay. And so basically what you’re doing is you’re creating a floor to cover all of those.
Basic bills. And you know that even if the, the stock market falls or drops or pulls back or is, has a tumultuous day like it does, um, you’re still going to be okay. You’re still going to be able to pay your bills. And so that’s what we’re doing is for a lot of clients, we’re creating that floor. Look, you, you never have to worry.
The older that you get, the less you have to worry about the stock market. So you’re literally creating a floor. Uh, social security is a great floor, uh, a pension. Even a guaranteed income annuity. Um, and, and something that has some growth in there too. Um, and there’s also increasing income in annuities.
So there’s, there’s some really good, very low cost or no cost annuities out there that do provide a lifetime income. Here’s the difference. You have to put ’em in a financial plan and see if those numbers work for you, because quite frankly, there’s a lot of people that come in. We probably fix millions and millions of dollars in annuities every single year.
We’re consistently trying to put somebody into a better product that’s going to better suit their needs. And so again, there’s also some people that have been in annuity and don’t want to be in an annuity any longer, so there’s options for that too. But again, trying to create that floor, you’re trying to get that guaranteed income to meet your basic needs.
That way you really never have to worry about. I like that idea. How, I mean, how much confidence do you have with, you know, knowing that that happens, that it doesn’t matter what happens. All my expenses are covered and, you know, I’m just worried about the fun money. Then it, it, you’re, you’re creating options for yourself because now all of a sudden, if you’re housing, utilities, gas and groceries are covered.
Um, now all of a sudden you have other options where you can allow the market to recover and your money will recover as well. There’s, there’s a lot of people who go through difficult times. Maybe they get laid off, maybe they get sick, maybe they’re taking care of a parent and they have to take time off of work.
So a lot of times they want to know, okay, but if I’m, am I still going to be able to retire? And we’re building that floor of income. And so, like I said, you know, As different as people are, we are all pretty much the same. I mean, we can all have bad times, we can all fall on bad times. And so the, the bottom line is, is that you want to be prepared for this.
And we’ve seen it. I mean, we’ve seen clients that want to work up to 70, they have a high earning job, and then all of a sudden at 66, 67, they’re burned out. Or they get laid off and then they know that they’re never going to find another job like that again. There’s just sometimes things that happen. So if you can create that floor that gives you the, the financial confidence to know that you’re going to be able to pay your day-to-day bills.
I like that. Financial confidence. So when we talk about bucketing our money, and I know there’s a million different terms for it, there’s bucketing, there’s sleeves, there’s, you know, different strategies that, so is that something that you. Yeah, of course. And like Eric said, this is another way to give yourself options.
So you want to start as you get deeper and deeper into retirement, moving the buckets around, if you will, the accounts around, and you’re setting up different strategies for each one. And it’s giving yourself options. Because if we look over the past 12 months, anybody that came in, they were all very worried about what’s going on?
Am I going to be able to keep pulling money outta my account with the market doing what it’s. When you have the options of choosing from different buckets that are doing different things for you, you’re able to turn on and off income from these buckets. It gives you the financial freedom that a lot of retirees are actually looking for, where the market can do whatever it wants, but you know that you’re going to be okay.
You know that your lifestyle’s still going to be sustainable because you have these different options for you. So I think creating these buckets of money, it can be overwhelming at first, but what we like to do, one of our favorite strategies to do is when we have a great year in the market, is peel off some of that money and create a new bucket of income for yourself.
Right? So if you’re just now getting into retirement, don’t feel worried that you only have your money in. One bucket because this is a process that we take our clients through over time. You’re not going to create seven new buckets in in one day, right? No, of course it’s going to be over time you’re going to start peeling things off.
Hey, let’s add this strategy in there. Let’s add this strategy in there. And then before you know it, you’re deep into retirement and you have all these sources of income that you can turn off and on, no matter what the market is doing. Boy, multiple streams of income. How cool is that? I mean, that really is the goal.
Yeah, I think, I mean, there’s a common quote, Eric always says that the average millionaire has what, seven or eight streams of income. Um, and it’s really because they allow themselves to have the options of where they’re pulling their money. Right then. So let’s talk about account sequencing and tie that into systematic withdrawals.
I mean, they do sort of tie together, don’t they? So I love this one. And a lot of people account sequencing or sequence of returns. And basically when it comes to those systematic withdrawals, you want to be very strategic about where you pull the money from. And a lot of times a client will say to me, okay, Eric, when I start to take out income, how is that pulled?
Where is it pulled? And this is account sequencing, and it’s basically the optimal order for withdrawing funds from the one that will minimize the most taxes. And so tax lost harvesting is considered when we do this, we’re constantly taking a look at, okay, if you have some losses, maybe we’re going to pull it from there.
And we’re also going to do some tax lost harvesting. Um, but at the same time, if you have an over concentration of stocks or some kind of investment, Maybe we’re going to start to pull it from there. The other thing is, if you have tax free money, maybe what we’re going to do is again, start to manage your tax brackets and maybe pull some money from your tax free buckets, and then pull a little bit from your, like let’s say your RMDs from your traditional ira, and I don’t want to get too confusing to people, but basically what you’re doing is you want to know that your advisor is actually going through all of your accounts, taking a look at everything that you have and making sure that there’s an actual.
Of how you’re pulling your withdrawals out. Absolutely, folks, and again, let’s go ahead and invite folks to call and if they’ve got questions about that and that whole sequence of returns, let’s, uh, get ’em in. Sounds good, Steve, whether you currently have an advisor or you’ve never worked with a financial professional before, we’re going to be taking the next 10 callers who are in need of that missing financial plan.
We’re going to create and customize a full blown financial plan, review value to over a thousand dollars and give it away. Absolutely complimentary, no obligation. What this will consist of is simply taking the mystery outta financial planning by taking a look at what you’re currently doing and maybe just making some slight changes.
Let’s map it all out. Your goals, income needs, expenses, tax strategies, and even transfers, a generational wealth. We’ll get that plan built for you and see where it leads. Let’s get you reacquainted with your investments without any obligation. In short, we’re going to take the guesswork outta financial planning.
Hey, we’re back on WealthWorkx Radio with Eric Kearney, Joseph Lanza, and consumer advocate. Steve said, oh, we are having a great conversation today, as always. And boy, here it is. Yep, we’re into December already. The year is over. And you know, we’ve got to, you know, maybe do some year end reviews of what we’ve got, where we want to go, how we want to get there.
Uh, and, and really it starts with, um, I, I, you know, right now, especially with holidays, people are feeling the crunch of inflation. Maybe they’re thinking, well, I’m going to stop saving in my 401k for now. Yeah. I mean, that’s typically the first thing that gets cut out. Yeah. I mean, you know, I mean, let’s face it.
I mean, when things slow down, uh, we get towards the holidays, you know, you’re, you’re, you’re trying to, everybody always wants to have the best Christmas for their family, right? Sure. Of course. Yeah. I mean, and you know, so it just, that’s the one thing, and we get off track. This is the one thing where, where I really want to help people.
Like I understand what that’s like, but you know, the thing is, is that when you try to make everything automatic, you know, it, um, it just makes things easier. And I always say this, you know, when, when people want to know what is the best suggestion that you can give someone? Well, when you really take a look at, you know, successful people, affluent people, they invest first.
And then they spend what’s left over. But the majority of people out there spend whatever they need and then invest if anything is left over. I mean, and, and that. So it’s reversed. And you know, I’ve gotten to the point where I’ve made everything very automatic. Like I’m definitely putting into my accounts on a regular basis.
It gets pulled from my bank account. That way I just know it’s in there. I don’t literally have to write a check or, you know, we have really good intentions of sending it electronically. We just don’t do. And so these are things where, you know, you got to keep making your distributions. I have a very good friend of mine who we’ve become good friends, um, and uh, he’s a roofer and I think he makes pretty good money.
He works for a good size company. Here’s the problem. He does not contribute to his 401k. And I mean, how long has Aveos of six months? When, when he comes in the office, I’m like, Did you do your 401k? We always ask him. Yeah. And it’s like, I’m trying to encourage him to get this done because I know that they have a company match and I’m like, that is free money that you’re leaving on the table.
And so we all want more money, but when you walk outside, if there’s a, if there’s a dollar bill on the ground, I still pick it up. Uh, my buddy, Mark Henry. The one thing that he and I have in common is if there’s a penny on the ground, we still pick it up after all this time. I mean, to me it’s free money.
It’s a penny. I don’t care. Even if it’s a nickel or dime, I pick it up, right? Yep. Um, but in your 401k, when that company is actually matching you, that’s free money. If you’re not taking it, that’s kind of dumb on your part. And, uh, so, you know, like I said, it’s just these are things that we really have to get set up for people.
And I’m, I really do encourage, even when I’m in the public’s line, I’m like, Hey, do you guys, you know, contribute to your 401k? No. I’m like, go back in the p in the back and, and fill out all that paperwork or call HR or get online and get it done. It’s so easy. And like I said, I mean there’s a lot of people that are pretty well off that have come from Publix.
You know, like I said, it’s just you want to start these contributions. You want to make the, you want to get in the habit and make it a good habit. Yeah. Ex absolutely. 807 7 9 1 9 4 2. That’s the number you can call. So when we say not checking up on your investments performance, uh, what, what do you mean there?
Well, a lot of people get caught up with the, you know, I’m just going to buy it and hold it for my whole retirement. Oh, okay. Or the other way around is they’re checking it every single day. Right. It’s hard to find the people that have a happy median of it. Um, and a lot of people were afraid the past 12 months to make any changes, because they’re like, well, I don’t want to sell at the bottom and then have to buy high.
Right. Cause it goes against exactly what every investor wants to do, which you should be buying low and then selling high. But a better question to ask yourself is you want to make sure your positions are relevant. , that’s what you should be going into your account and checking, do my positions actually have the ability to recover when they’re down?
Is it going to take them much longer than something else in there that could recover? Um, and this is a much better way than just looking at the percentage points of, oh, I’m down this much. I should sell, or, I’m up this much. I should sell. You need to start looking at the external environment. You know, it’s a, it’s a definitely a huge piece of how we manage money, right?
Is asset class relevant enough in the current market to actually recover and show our clients some profit. Okay. I like that. And, and so, but again, just keeping track of that. Like you said, it can drive you crazy if you look every day. Yeah. It’s funny, I mean, a lot of times. When we take on a new client, we can see when they log into their accounts, and um, a lot of times it’s every day or twice a day at first, and you can literally watch the pattern where it’s like every single day, and then it goes to every other day, and then it slowly goes to once a week, and then it slowly goes to once every two weeks.
You know, because they, they build up the confidence in their account. They see that there’s active management in there. They know somebody has their eyes on their account at all times. Um, and they slowly build the confidence to be like, oh yeah, I check it once. Just to see where I’m at. Yeah. Right. And so they, it’s, it’s just like anything else.
You want to build a healthy relationship with it. Um, and it’s, it takes time and, and comfortability. Well, that’s exactly, and, and you know, as Eric was just talking about how, how easy it is to do on, uh, you know, with a 401k, it’s just automatic. Yeah, a lot of it you can do from your phone now too. I mean, you don’t got to log on anywhere, just do it right from your phone, right?
Sure. Um, so as we start going through this, we’re talking about, um, you know, things to do in December, uh, besides, uh, you know, buy holiday gifts, , and right now, I think this is probably what people are doing more than anything. My opinion is that the market’s going crazy. Oh my gosh. I’m way down. I got to.
Yeah, I mean, you know, this is the time to really take advantage of this market. I mean, you know, I personally have been buying a lot of things in my account lately, and I’m excited. And we’ve also created opportunity for our clients. Like we have moved to cash, uh, significant amount of cash, you know, 6, 7, 8 months ago.
And there’s a lot of people that are still fully invested. Well, I mean now they’re looking at their advisor and like, what are you doing? Like, and the advisor are like, oh, you just have to wait for it to come back. But you have to remember that if your account is down 20%, you literally have to come back 25% to break even.
And a lot of people, if you do the math, you take a look at a half a million dollar portfolio down 20%, you’re down a hundred grand, you’re down to $400,000, the account comes back 20%. Your 400,000 is only worth four 80. So if you’re down 20%, again, you’ve got to come back to up 25% just to get back up to 500,000.
And that could take a very long time. And what you really have to realize is, You know, is your portfolio able to come back? Because there’s a lot of people’s portfolios who are still in bond funds or wherever they are, that are not going to come back as quickly as they expect them to. And that really is unfortunate.
So there’s a lot of things that you have to take a look at. The last thing that I’ll say about this is that, you know, there’s been a huge return this year to traditional investing. I mean, people are got have gotten away from. Stocks, s p a, not to be confused with spec stocks, S P E C. Um, and you know, people have gotten burned through, those, people have gotten burned with, uh, small cap stocks and microcap stocks.
People have gotten burned with crypto this year. Holy cow. There’s a whole, there’s a, there’s a story there. It really is. And you know, the thing is, is that we’ve talked about it before and you know, and I’ve told everybody full disclosure, I. All of my crypto quite a while ago now I think it’s like it’s going on maybe 10 months ago
And uh, you know, so I missed the whole mess of this entire thing. But, you know, there’s also a lot of people that we tried to encourage who had millions of dollars in crypto, millions of dollars. And you know, if you cashed it in, then it was real money. But now all of a sudden, you know, cryptos, you know, it’s just, Uh, again, it’s just, it’s a very volatile asset class and a lot of people tend to play with it.
And you take a look at Miami, which is right across alligator Alley from us, and they’re trying to be the crypto city of the United States, but now all of a sudden they’re struggling with this whole FTX symbolical and, uh, it’s just, it’s just a complete mess. But the bottom line is that people are starting, thank God, to return back to traditional.
Well, and I mean, you know, you talk about crypto, there’s, I mean, yeah, the FTX thing that went bad. There’s another one that just went belly up. I mean, how do we deal with that if, because that was going to be the be all, end all. Do you see crypto going somewhere other than just kind of down. I mean, I, you know, we don’t include it in anyone’s financial plan, right?
If, if you have it as, you know, an asset class, we will acknowledge it, but we’re not really including it. And I’m not, that’s not to say that in another five years or two years, you know, this thing could, you know, change around. But the interesting thing is, is that the CIO or CFO of, of Bitwise has been doing a lot of commercials on CNBC and it’s.
Not funny, but it’s really interesting to see how he’s, you know, uh, spinning all of this stuff and it’s like, it really is not a very good, um, asset class for somebody that’s looking to retire or take out income. I mean, talk about adding volatility to your portfolio. When you throw in a sleeve of any kind of crypto, it’s going to throw your standard deviation or your volatility through the roof, that that’s not what any retiree wants.
I mean, we’re trying to. That. So, you know, the, the whole thing on crypto and all these other volatile asset classes is a whole another conversation. So let’s, what’s your take on, I mean, I know a while back Fidelity started saying, okay, we can, you can include crypto in your, in your accounts. Um, was that a bad choice?
Was that a bad decision, do you think? I don’t think it was a bad decision because like I said, I mean there’s a lot of asset classes that have evolved over the years. Okay. Um, and I mean, this could be another one. I think the thing is, is that people have these over concentrated positions and they really think that it’s like a get rich.
Quick scheme and it’s not, um, you know, like I said, will I eventually get back into it? I don’t really know. I mean, I was so happy to get out and actually get into something that was tangible. And I also have a friend of mine that lives up in Tampa who had millions of dollars worth, and I told him, I said, look, Sell this, buy a piece of real estate, rent it out.
Now you have something tangible. Well, he didn’t listen to me because he keeps thinking that it’s going to go up. Well, obviously he’s lost an incredible amount of money and now he does not have the ability to buy that piece of real estate. So, The thing is, is that any investment that you have, are you reallocating?
Are you rebalancing? Are you being efficient with that money? And a lot of people are making very emotional decisions and that’s not a good place to be. Not at all. Well, again, folks, if you were, uh, in a quandary about what to do, now’s the time to give Eric and Joseph a call. Come on in, sit down and have the conversation.
Whether you currently have an advisor or you’ve never worked with a financial professional before, we’re going to be taking the next 10 callers who are in need of that missing financial. We’re going to create and customize a full blown financial planner view value to over a thousand dollars and give it away.
Absolutely complimentary, no obligation. What this will consist of is simply taking the mystery out of financial planning by taking a look at what you’re currently doing and maybe just making some slight changes. Let’s map it all out. Your goals, income needs, expenses, tax strategies, and even transfers with generational wealth.
We will get that plan built for you and see where it leads you. Let’s get you reacquainted with your investments without any. In short, we’re going to take the guesswork outta financial planning.
Hey, we are back on WealthWorx Radio. I’m consumer advocate, Steve, so all joining me as always here at Kearney and Joseph Plan this year as well. Having a great conversation.
Retires with car. I just had to do that. Erica, you I love that. I’m pretty good on the drums. , that was you. All right. Good to know. , I like it. All right. Well, we’ll get a reaction from that. I’m. I wish It’s alright. Anyway, so let’s, we got to jump into some of this stuff. So again, so tell me about that, Eric. I mean, you got the, you got the jingle going.
I mean, that’s kind of fun. Where you, is that going to be used in your spots? Is that going to be used in your TV show? What are you going to do? Yeah, so there’s actually a Dan the jingle guy, um, local guy, and, uh, he writes a lot of local jingles. Great guy, very talented and everything. And, uh, You know, called me up one day and he is like, Hey, you know, we, we want to get a jingle for you.
And, uh, so we’re including that in our TV show, radio show, and everything. It’s just, it’s super fun. I mean, we just wanted the, you know, , let’s face it, financial planning is not the most exciting subjects. It is not no It’s like you come on the radio every week, it was like, roll over your 401k, Well, Well, that’s it.
I was talking to somebody today about just that, you know, I mean, I’ve been putting show notes together. Uh, this is, I think my 261st version of show notes. Wow. Wow. So I, you know, my challenge is trying to come up with different things to say only it’s the same thing over and over. Of course. I mean, you know, I mean, how many different, I mean, uh, how many different you.
Things of white, can you talk about Right, exactly. White is white. It’s like snow, you know, it’s like same thing with this stuff, you know, like, you know, what’s your budget? You know? Exactly. So it’s always fun to have something like this. Just show up. Yeah.
Boom. Yeah, I like that Boom. Love it. Yeah. Little bit of life to the show. That’s what we’re trying to do here. Keep things light and fun. Right? Wake up out there,
Oh yeah. Oh, you know, we could do, I’m here. I, I, sorry. We’re going to, do I do this one more time? I think just. Retirement. Well, advisors with Car and Joseph Lanza I like that version better. Perfect. Steve. Oh, oh, you have a voice for radio, Steve. That’s exactly right. Yeah. Oh boy. Well, um, so you want to get into some of these questions here?
People actually have legit questions. Yeah, let’s do it. Uh, Diane’s and uh, Marco, I like this. She says, it is certainly challenging. I’m trying to decide between two different financial advisors. Are there things to ask them beyond the obvious to pick the right one? Yeah, this is a great question. I mean, and I always tell people you really want to go out there and this.
A lot of work. It’s a lot of effort. But what you’re trying to do is you’re really trying to differentiate which advisor is better for you. And the thing is, is that you want to know that they are capable of handling your money. And the reason I say that is I think that the, a lot of people’s money. Has graduated from their advisor’s capabilities, and that’s not a good place to be for the, for the client.
And so the thing is, is that you want to know as your money grows, so are the strategies, so are the tax capabilities of this person. And quite frankly, there’s a lot of advisors out there who do not provide tax planning, um, who do not look at those types of things. And so that may not be a good fit for you.
The other thing is, is that you want to ask who is your typical. Um, we do work with a more affluent client. I mean, that is typically our forte. Um, and it’s, it’s not because, you know, we’re trying to work with bigger money. It’s just that that’s what we’ve evolved into. We’re a strategic planning firm. We have a certified financial planner who, by the way, actually does write plans.
Um, we write income plans, we do tax planning. We work. Very closely with CPAs and estate planning attorneys. Um, just this whole week I was on the phone with an estate planning attorney, uh, almost every week. She does an amazing job for us. Um, the other thing that’s frustrating out there is you see a lot of CFPs.
Um, Donna CRO is a certified financial planner in my office, does a great job. Uh, Joseph is working on getting his CFP as well, but what you see out there is a lot of CFPs, but they do not write financial plan. So what, what good is being a CFP if you’re actually not going to write a financial plan? And we have taken away millions and millions and millions of dollars this month from other CFPs who have never written a financial plan.
So that’s frustrating to me. Why wouldn’t they write a plan? I don’t understand. How does that, I mean, does that It’s not part of what they do. I mean, they’re supposed to, but should be. It should be. But I mean, quite frankly, you know, they’re just after somebody’s assets. And so the thing is, is that we do financial planning first.
Um, again, the whole purpose determines placement thing. We’re really, we want to know, and believe it or not, like once we understand what your goals and objectives are, I mean, and that financial plan is built. We’re all on the same. And that’s the biggest thing anymore is there’s not a lot of transparency out there.
So these clients that, that are coming into us feel like, you know, there’s no transparency. I don’t know what direction I’m going into, and that financial plan really will help you. So this is a good question, Diane. You really want to dig in deep and figure out, is this your person for long term? Well, yeah.
Norman is in Englewood. Norman says, I’m 64 years old. I’m planning to retire in June of 2020. I’ve got $220,000 in my 401k and about $2,000 a month in real estate income. Is there anything else I should do before I sign up for retirement? Well, first of all, good job on having the real estate.
That $2,000 per month can is really a great, another source of income like we were talking about earlier, building that floor of income and yeah, you know, you can add that onto your social security, any pensions, any other type of income, and that’s a great way to start your retirement planning. Um, but for Norman’s, You know, before he actually signs up for retirement if he hasn’t contributed to a Roth yet.
And I know we sound like a broker record on here where we’ll like contribute to a Roth. Contribute to a Roth, but the tax, the tax purposes of a Roth are so. Greatly outweighed when it comes compared to a regular ira, um, that it’s so silly not to do this. So if he can, you know, before the year ends and he has up until April of next year, he can max out his Roth contribution and then if he were, has earned income in 2023, he can also.
Add another year’s worth of contributions into that Roth. Um, and they are upping those contributions. So if he’s, you know, he’s 64 years old, so I believe that would be $7,500 and 2023 that he can put in there. Um, so he’ll have close to $15,000 in his Roth that he can start earning money on, you know, growing it.
And when he goes to pull that out, it’ll be completely tax free to him. Sure. Well, I mean, again, because he’s over 50 down and a half, um, you know, he could move that 401K money over in a minute. Right. As long as his, as long as his job allows him to do that before he separates from service, sometimes I’ve seen them where they make you wait until, you know, 70 years old or your actual separation from service date.
Oh, okay. Um, I have, we have seen that actually this year with the client. So it all depends on the, depends on the plan sponsor. Um, but yeah, once you get into full, you know, Once you get into retirement, it’s always better to roll out your 401k. Sure. 807 7 9 1 9 4 2. Norman, uh, let’s go ahead and, uh, visit, uh, check in with Chuck.
Um, Chuck says, I’m 67 years old and retired. I recently inherited $50,000 from a relative. I’m not interested in investing in the stock market. What are some other options to invest? I mean, so luckily right now there are other options that you’re, you know, that you could have, um, if you want to stay away from the stock market.
The bottom line is, is that what is really the purpose, again, for the money? Is it future income? Is it just for savings? Um, you, you really have to determine, The purpose of that money to determine placement, and there’s a lot of people who would just want to park their money somewhere, but then you have to think about taxes, you have to think about inflation.
You have to think about future healthcare. So again, what is, what are you missing in your. Finances that you could fulfill. And for some people it may say, well, I don’t really have a lot of emergency savings. Or some people will say, I don’t really have anything for healthcare or long-term care. So maybe what you’re doing is you’re earmarking that for something specific.
The other thing that people want to do is they say, look, I have plenty of money for retirement, but I want to invest something for my children. So maybe you take this money and you. Specifically for them. So again, you really have to take a look at, you know, your financial plan and see what holes you have in that, what are the strengths and the weaknesses, and then go from there.
Sure. 807 7 9 1 9 4 2. Let’s see. We’ve got time for one more quick one. Let’s go to Robert in Cape Coral. Robert says, I have money in certificates of deposits, uh, and I’m. Fees for withdrawing from these accounts. I want my money to be able to grow in an account, but I also want to be able to withdraw from it without any fees if needed.
What kind of other accounts can I invest my money in? Well, the most basic one would just be an individual account and, um, if he’s investing in CDs and he wants more of a stable rate of return, I would say that there’s a lot of good dividend paying stocks that he can invest in, in the market instead of having these CDs.
A lot of people don’t realize, you know, they get, they get excited about these CD rates. Like, oh, I can get 3% and maybe it’s over two years, or it’s over 15 months. Giving up your liquidity for that account. Sure. All right. Well, there you go. That’s some good stuff. 807 7 9 1 9 4 2. Robert. In fact, let’s go ahead and put, uh, put a final call out there for folks to come on in and, and talk with you.
Hey, everybody out there. Thank you so much for listening. If you’re looking for a second opinion or a fully written comprehensive financial plan, let’s take the next five callers who are in need of that financial plan that is missing. If you’re serious about your finances, this is a great opportunity for you.
We’ll create a full blown financial plan. Valued at over a thousand dollars. Let’s give it away. Absolutely complimentary. No obligation to the next five callers who have saved at least $500,000 for retirement. And what this will consist of is simply taking the mystery outta financial planning by taking a look at what you’re currently doing and maybe just making some slight changes.
We’re going to map it out. We’re going to run all the reports for you. The fee report, the Morningstar reports, a tax analysis, maybe a volatility analysis. Let’s see where it takes. Let’s see where that plan leads you. Let’s get you reacquainted with your portfolio, and again, without any obligation. If you are interested in your very own income plan, we’ll show you proven strategies and techniques to turbocharge your retirement income.
In short, we’re going to take all the guesswork outta financial planning. So again, for the next five callers, a full blown comprehensive financial plan interview. It’s over a thousand dollars value. We’ll be giving you away complimentary. No obligation. Call us. Tell, well, the advisors with Aaron, Carly, all. So again, folks give us a call.
Eric Joseph has always a pleasure to be here. Had a lot of fun today and I hope, uh, the information was as powerful as the usual. Thank you, gentlemen. I appreciate both of you and everybody out there. Thank you so much for listening. Remember, you only retire once.
Let’s get it right the first time. Have a great week and an even better retirement.
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