Answering Listener Questions about Money and Retirement

6.16.23: Audio automatically transcribed by Sonix

6.16.23: this mp3 audio file was automatically transcribed by Sonix with the best speech-to-text algorithms. This transcript may contain errors.

Producer:
Any examples used are for illustrative purposes only and do not take into account your particular investment objectives, financial situation or needs and may not be suitable for all investors. It is not intended to predict the performance of any specific investment and is not a solicitation or recommendation of any investment strategy. Welcome to the Active Wealth Show with your host, Ford Stokes. Ford is a fiduciary and licensed financial advisor who places your needs first. He'll help you protect and grow your wealth. The Active Wealth Show has grown because activators like you want to activate their retirement planning with sound tax efficient investing. And now your host, Ford Stokes.

Ford Stokes:
And welcome to the Active Wealth Show Activators on Ford Stokes, your chief financial advisor. I've got Sam Davis, our executive producer on here. And I just want to say Happy Father's Day weekend to all of the activators. Just really appreciate all the dads out there that have worked hard to provide for your families and and also tell those important dad jokes. We'll have a couple of dad jokes here on the Active Wealth Show today in each segment. So something to look forward to there. Sam, why don't you say hello to everybody. Welcome to the weekend activators and certainly a happy Father's Day to all the fathers tuning in to the Active Wealth Show this weekend. Excited to be on the air once again, bringing you a great episode. Yeah. So today we're going to talk about answering questions from our listeners.

Ford Stokes:
We feel like that was just a really good, important, fun Father's Day topic. And also we're going to talk about how inflation is impacting your summer vacation. We also just want to say thank you to the activators for making us the number one listened to radio show on Am 920 The answer on the weekends. We've been on Am 920 the answer for over three years now and we just sincerely appreciate. Our ability to talk to you each and every week. We also try to give you a new show every week and not just a recorded show. And this is no different. Father's Day weekend. We're still here. We're still here for you. We're going to do everything we can to help protect and grow your hard earned and hard saved assets and help you invest more tax efficiently, fee, efficiently, and market efficiently out there. And Sam, can you tell them how they can also look at some of our old episodes and how they can always watch us and see the video from the Active Wealth Show? Yeah. So just head on over to active wealth. Show.com there you can find our archives of all of our past episodes. You can watch video of the episode that you're listening to on the radio right now. You can also check out our podcast wherever you listen to podcasts. It could be Apple Podcasts, Google Podcasts, Spotify, Pandora, whatever you like to listen to.

Producer:
The Active Wealth Show is there for you and go ahead and click subscribe so you never miss an episode. That's right. It's good stuff. Also, just, you know, for our listeners out there for our activators, get in touch with us to receive our free report on tax free investments for a better retirement, You can just simply go to active wealth.com, click that, schedule a consultation button in the upper right corner. We're happy to get that out to you when you schedule an appointment with us. Or you can just send me an email at Ford at Active wealth.com and we're happy to help there as well. So here's the overview of today's show. We're going to have the quote of the week. We've got some words of wisdom to start all of our conversations today. We're also going to have an inflation demonstration talking about how inflation is affecting American vacations this summer. Also, we've got questions from our listeners, answers to the questions you folks are asking us. And then also we're going to talk about misconceptions about Social Security busting myths and educating our listeners, specifically educating you activators out there, and then also options outside of your employer's retirement plan and how to get started today. We're going to give you also one hint about what you should be doing with that IRA contribution that you could be putting in this year.

We'll have a really good recommendation on that and segment two and we've got a really good this Week in history on America's first roller coaster, a famous statue and more. Sam, why don't you go ahead and share our financial wisdom quote of the Week. And now wholesome financial wisdom. It's time for the Quote of the Week. This week's Quote of the week comes to us from James W Frick. And James Frick once said, Don't tell me where your priorities are. Show me where you spend your money and I'll tell you what they are. Amen. And pass the turnips on that. So for me, my money goes into my girls 509 account. It goes into. My wife's and my retirement accounts at a clip of 15%. Each and every every two weeks. We're trying to do that and make sure that we're being consistent about that. And we're also putting money into, you know, brokerage account. And then we're also investing in things like buying a brand new building for the for active wealth management. So we're no longer going to pay rent. We really appreciate our time at the King Queen building, but we're going to move up closer to Halcyon and Exit 12 in Alpharetta. I know we just kind of would love to celebrate with you activators out there that the Active Wealth Show and active wealth management is growing where we're going to actually own our own building, which is pretty great stuff there.

And we're going to be right off of Exit 12 in Alpharetta. And there's some really great restaurants up there. And we also cater lunches when people come in to meet with us. So if you want to have a free catered lunch from, say, cattle shed or any of the other restaurants up there at Halcyon, we're happy to do that for you. And you can come in and get a free consultation where you can get a portfolio analysis and a financial plan to your 95th birthday that includes a Roth ladder conversion plan. We're moving on June 23rd, which is next week. So we're next Friday. So we're super excited about that and we wouldn't be able to do it without our clients at active wealth management and without our activators and our our loyal listeners. Thank you so much for listening. I want to give a shout out to several different folks that that are listening on a consistent basis. Jerry in North Atlanta. Jenny actually in in East Atlanta, kind of over there in the Lilburn area. And I just really appreciate you reaching out to me this week, Jenny. And always, you know, Al and Lucy, we just really appreciate you all. You guys are always great, loyal listeners and also clients of active wealth. And we're we're big fans of you guys, so you just want to kind of give a shout out to folks. We're going to save their last names to protect the innocent here.

But if you want to reach out to us, I would encourage you to call us at (770) 685-1777. Also, you can find us on Twitter at Active Wealth. M the M stands for management. At active wealth M on Twitter. And then you can also obviously just send me an email any time at Ford at active wealth.com. So, Sam, we've kind of got a really big important show today. We're talking about a big thanks out there to the dads out there. I'm Fordunate that I know your dad as well. He's a great guy. He also happens to be my same age, which really dates me how how young you are. It's crazy. But, you know, just share a little bit about your dad and what it's meant to you to to make sure he could provide for your family and all that stuff. And then we're going to talk about this inflation demonstration. Wow. Well, happy to do it. You know, my dad is definitely one of my best friends, was able to go back to Kansas recently. And I remember riding around in his 1986 seven Jeep when I was a little kid. I mean, there's even pictures of me riding around in it when I was a baby and I was able to ride in it again. He had just recently restored it. And just so many memories, you know, working on cars with him over the years.

Now he's in land management, so I spent a lot of time with him enjoying the great outdoors and we continue to do that every single year together. We've got an annual baseball trip that we do, which I think is a fantastic tradition for any of the the fathers out there to visit all of the major league ballparks. So we try and knock 1 or 2 of those off every year. And and by the time he gets, you know, a little bit into retirement, we should be done with that. And maybe we can move on to the next journey and next adventure that we do. But happy Father's Day to my dad and definitely to all the dads listening out there. Yeah, it's really cool. I love that that you guys do that trip where you go to a different 1 or 2 different ballparks every year. You've gotten through a lot of the major league ballparks. And I just think that's a really cool thing to to my dad. My dad is just really been. A big inspiration for me because he was always the provider. He was always the guy that was there to support us. He's got six kids. I have a full sister and then a half brother that I'm very close to and three half sisters and we're all close and. Just got done hanging out at the Birds Club and in Georgia. And it was originated like in 1809.

And it's a quail plantation kind of a deal. That was pretty neat. But it was great to see my half sister Brittany get married. And congratulations to Brittany and Patrick. But just it's just remarkable to see somebody. You know, my dad was is an attorney. He took me to go fishing up in just south of the Arctic Circle and then up there in Saskatchewan. And then we also have gone and done things like gone to Africa and gone on photographic safari, going to the Braves games, all that stuff. And being my little League baseball coach, that was a big deal. I was able to be my Little League baseball coach at the Little League baseball coach for my half brother. My dad's older. He's 84 years young. So shout out to Max Stokes, who's still practicing law at the young age of 84 years old. And and just thanks again. Out to everybody out there, the dads out there for working hard and sacrificing and providing because that's what that's that's our job, obviously. You know, we spell love in our family time. And I know, Sam, your dad, you and your dad spent a good amount of time together and same with our family. And I just want to say, make sure you're you're taking the time and you're spending the time and also have a retirement income plan so you can spend that time. It's more than just building that one big nest egg.

It's really more about generating that consistent monthly income. When you're living on fixed income, more fixed income will help you spend more time with your family, whether it's gifts or whether it's going on vacation or having that lake house or that beach house. That could be your primary home being close to some body of water so the kids will come visit you. Those are, you know, overstepping my bounds a little bit. But those are some of the hints that I give retirees. Like if you can get into a place that's a destination, those kids and grandkids will come see you and want to make sure that you're spending as much time as you can with them and just want to say happy Father's Day to all the dads out there. Really appreciate you. We're running out of time here in segment one. When we come back from the break, Sam and I are going to talk about our new inflation demonstration and talk about how more Americans are opting for staycations or near stations as inflation continues to batter budgets. If I had a hammer, I'd hammer in the morning, I'd a hammer in the evening all over this. Thanks for listening to the Active Wealth Show. If you like what you're hearing, subscribe to our YouTube channel to watch videos from this program and other recent episodes. And welcome back. Activators, the Active Wealth Show on Ford Stokes, your chief financial advisor.

I've got Sam Davis, our executive producer here. And Sam, you've got a couple of Father's Day focused kind of photographs. And the first one you're pulling up is actually a photo of our girls and of of Diana's and my girls, Grace and Madison. And this photo was taken. If anybody wants to see this photo, they can check us out at Active Wealth Show.com and just go ahead and and see the episode and you can actually watch the episode here. But it's like in the 21st minute of, of the actual recording I think somewhere around there. But this, this photo of our twins, they took it up against a mirror that also had a mirror behind it at the Louis Vuitton store. And it was the first time I ever bought Diana a LV purse. And we went together to go get it. It was a big deal for us and it looked like we had quadruplets. So it was kind of a fun, fun picture. And we did that for Father's Day. But, you know, when you're when you're a dad, you those kind of moments really matter. And it was pretty cool stuff. Yeah. So this photo Ford was talking about this in segment one, but you can go to Active Wealth Show.com to take a look at this. But when my uncle Jimmy, my dad's brother was in the marine corps, he bought this 1986, I believe seven jeep in bright red and he drove it back to Kansas.

At one point he decided he didn't want it anymore. And so my dad, being a nice younger brother, decided that he'd give him some cash for it. And so this is a picture of me and a little kid car seat riding around in the jeep. And I just rode in that jeep that's been completely restored about a month ago back in Kansas. And so that's what I was talking about. And it's really cool to see this old picture. I wasn't sure I was going to be able to find it, but I was able to pull it up. That's cool. And it looks really great. Little, little old Sam there. And it's just those kind of memories are priceless. That's great stuff. Want to know where your hard earned money is going. It's time for an inflation demonstration. So, Sam, let's go ahead and talk about that inflation demonstration. I want you to go ahead and share more information about how Americans are opting for staycations and negotiations as inflation just continues to batter household budgets. Yes. So kind of an inflation update here for summer of 2023. According to a recent survey, 88% of people say that inflation has cooled off their summer plans. And that actually turns out to be 41% of Americans saying they won't travel at all this summer and 1 in 5 or 20% are going to limit those trips to those within driving distance.

And just a quick tip for the activators that flexibility can be a great cost cutter if you're budgeting for vacation because the popular tourist destinations tend to be more expensive, you can just do a little bit of research, find some off the beaten path destinations or find spots where the US dollar is strong relative to the local currency. If you're traveling internationally and you can look up foreign exchange rates for 2023 online and that should help you in your research. Here's some more stats. According to a Harris poll from just this week, 75% believe that the worst of inflation is still ahead of us. And respondents are feeling the sting of inflation in these key areas. Gas where 78% of respondents said that they're really feeling it at the gas pump. Groceries with 66 or 2 thirds of respondents still feeling the sting of inflation at the grocery store eating out, 49% say that eating out has just gotten a lot more expensive. Same with utilities, 49% and health care. A third of respondents say that health care costs have gone up for them. So one more thing for some lifestyle changes that people are reporting because of inflation, 48% of people have sought out new sources of additional income over the last few years. 46% have cut back on savings or stopped altogether. 38% have accumulated more debt than usual.

35% have started providing financial support to a family member, and 30% have have said that they missed or will soon miss a bill payment. So inflation still impacting hardworking Americans in the worst ways. And I saw that this week. Ford that the Fed decided not to raise interest rates, but they did signal that there will be more to come later this year. Yeah, a couple of things to unpack there. One is from my own personal economy. When to go get gas. Usually when I'm in and I was in Alabama and I usually like to fill up and on gas because the taxes on gas are less in Alabama than in Georgia when I'm passing through and. I couldn't believe it. I paid $4.05 for premium gas at the Marathon oil gas station in Auburn, Alabama. And that was the most I'd paid in a while. So I think they've already come up. I think gas prices are already coming up for the summer and then back to the 48% of folks that have sought out new sources of income. We're seeing more and more of this. But also, I want to be clear about one thing. It's more about what you can do with your income and how much you can save off of your income to really generate and build your wealth. But also you can generate great retirement income by investing in fixed indexed annuities or life insurance or both.

And you can also minimize and kind of delete the IRS from being your partner in retirement with a Roth IRA conversion that you need to do that systematically over time, year over year, moving money from your IRA to your Roth IRA. Dollar for dollar. And we can help and show you how to do that so you can minimize the taxes you're going to pay on that. So you're not in that 32 or 37% bracket when you're doing that conversion. We want you to be in that 24, 22 or even lower tax bracket, an effective tax rate when you're doing Roth ladder conversions. And generally, the best time to do that is when you stop working. But you're going to feel so much better if the IRS is deleted from your account. I mean, it's crazy to understand, but if you have a over a $400,000 in your IRA. Or a Sep IRA or a 457 or a 401. Or 403 B. If you've got over $400,000 in one of those tax deferred qualified retirement accounts. And it means it was qualified for tax deferral and tax deferred growth, by the way. But you're still going to pay ordinary income tax on it. If you've got over $400,000 in one of those types of accounts. And it's eventually going to end up into an individual retirement account for you. When you stop working, you separate from your employer. You're going to be able to save over six figures in retirement.

If you implement a smart tax solution with a Roth IRA conversion and we can help you do that. So if you're interested in trying to figure out how can you implement a Roth flat or conversion and you're trying to figure out how you would do that and what you're doing, then I would encourage you to go ahead and reach out to us at Active wealth.com that's active wealth.com and click that schedule a consultation button in the upper right corner if you want to reach out to us at active wealth. Show.com that same schedule a consultation buttons in the upper right corner on that site as well. Or you can call us at (770) 685-1777. You're also going to get booked directly into my calendar. So it's something that's fairly remarkable there. And Sam, you're bringing up on here right now, according to Triple A, the gas prices across the country. But these are. Not the premium gas cost, but the regular gas cost that 87 octane gas prices. And go ahead and share a little bit about that. Yeah. So if you're filling up this weekend and hitting the road for a vacation or even just on the road for the day, the national average is about 359 a gallon here in the state of Georgia. That is going to be about $0.20 cheaper. 329 a gallon, about $0.30 cheaper. If you're headed down to Florida, it's more expensive down there in the Sunshine State.

So you may want to fill up before you cross state lines or get too close to Orlando or wherever you're headed down there. In general, you're going to see lower prices here in the southeast and much more expensive prices on the West Coast. If you look at the most expensive states, it's all out there on the West Coast, California, Arizona, New Mexico and Nevada. Wow, That's something else there. Um, be careful out there. Be careful when you're on the roads. We want to make sure you arrive alive. And by me saying that, I'm able to make myself feel better. And hopefully I'm protecting you guys and gals on the road because we really care about you. And but also, you know, it's probably generally cheaper to kind of travel within the Southeast. The great news is we've got some of the best beaches in the world in Florida, just six hours away. Um, and then also we've got our own beaches at Saint Simons and Sea Island and in Savannah and all that stuff. So we're, we're super glad that we've got those beaches available to us. Plus we've got so many lakes down here in the southeast that people can enjoy. You know, they enjoy their Memorial Day weekend and their July 4th and Labor Day weekend and all that kind of stuff at the lake. And they always seem to be with great people and having just a great time there and grilling out and water skiing or wakeboarding or wakesurfing and and just hanging out at the dock, things like that.

So. Get out there and spend time outdoors, get some vitamin D in your life. Go ahead and get the sun on your skin a little bit. If you're if you feel like you're staying in too much, go ahead and get outside. Also, the one thing I will share is the one consistent thing that Al Roker and Willard Scott and all those people have when they do the Smucker's thing. Sam, they they will. They ask all these 100 plus folks that they're celebrating their 100th birthday on the Today show. And the one consistent thing that all of them say is they started walking like right around when they were retired. They just walked and they walked every day. And so make sure you're moving your body and and staying out there. I mean, I'm sure all of us are getting older. We're all trying to figure it out. I try to play golf or tennis two, three, four times a week to try to stay active. And and that's really helped me. When we come back from the break, we're going to answer some questions from our listeners, pre-retirees and retirees who listen to our show to learn more about smart financial planning. We're going to have all those answers to some really great, insightful questions from our activators right when we come back from the break.

You're listening to Active Wealth Show right here on Am 920. The answer. I don't really know. I will give you. Ready. Charlie Kirk here. If you're concerned about your investments, rising taxes from the Biden administration, then I encourage you to listen to the Active Wealth Show hosted by my good friend Ford Stokes right here on Am 980. The answer. Listen to the Active Wealth Show Saturdays at noon and Sundays at 11 a.m. The Active Wealth Show right here on Am 980. The answer Investment Advisory Services offered through Brookstone Capital Management, LLC, BCM, a registered investment advisor, not an actual client of active wealth management. Thanks so much for listening to the Active Wealth Show. Make sure to rate us everywhere you listen to podcasts, including Spotify. And welcome back to the Active Wealth Show Activators. I'm Ford Stokes, your chief financial advisor, and I've got Sam Davis on here as our executive producer. And Sam, we are fielding questions from our listeners where people have emailed me at Ford at Active wealth.com or they've called us at (770) 685-1777 or they have posted questions on Twitter at active wealth M That's our Twitter handle at active wealth. M is in management and we're talking about questions where pre-retirees and retirees who listen to the show who are activators. And they want to learn more about smart financial planning. Go ahead, Sam. And let's list off these questions from these great listeners.

Yeah. First off, thanks to all the activators who either called in or submitted your questions. We got a lot of them. And so we picked out some of our favorites. If we didn't get to your question, it's either because someone else asked a very similar question or we're going to get to it on a future episode. So here's the first one. Linda in Alpharetta asks, Where will my retirement income come from? I have been saving for decades for retirement, but now that I'm close, I'm wondering the best ways to turn our savings into the income we need to live on during retirement. Yeah. Linda, thanks so much for the question. Most retirees receive income from four main sources. It's four main sources. Number one is personal savings and investments. That's IRAs, Roth IRAs. Et cetera. And you get withdrawals and also required minimum distributions that now it's required minimum distributions kick in at age 73. Previously it was 72 and previously before that, In the last few years it was 70.5 years old. And now at least they got rid of the half year. So they can confuse people as much. And then number two is company pension plans. And there's only 14% of all Fordune 500 companies still have a pension plan. By the way, if you've got a access to a pension plan, congratulations. Great for you. But what I would encourage you to do is get a pension plan analysis, get that pension plan x ray from us.

We're happy to help you. All you've got to do is reach out to us at (770) 685-1777 and we could potentially get you a 10 to 20% bonus as well as a 325% participation rate in an underlying index. That should be more accretive and better for you and should grow over time. Most pensions are built with a product called a sPIa, a single premium immediate annuity. Those are great at paying us our money back. They're not really good at growing our money. And also, you won't be able to pass on that money to your heirs. So I would encourage you to consider taking that lump sum pension. We also have access to a proprietary fixed indexed annuity. And I think you're really going to like it because it offers a 20% bonus, a 325% participation rate with a 1% spread. So example, if an index goes up 10% over a two year period. You're going to end up getting 32.5% growth over that same two year period instead of just getting 10%. And then the the annuity company is going to take a 1% fee on that. So it's going to end up being 31.5%. If you're interested in getting a 20% immediate bonus on your money. Getting a higher payout and getting a higher participation rate because these these interest rates keep going up and therefore the fixed indexed annuities are working better and working overtime for investors because there's more money left over from the ten year US Treasury as the ten year US Treasury is paying out more money, then I would encourage you to pick up the phone and give us a call at (770) 685-1777 or visit active wealth.com that's active wealth.com and you click that schedule a consultation button in the upper right corner we'll give you a pension plan x ray or an annuity x ray report.

Absolutely no cost to you. Again, all you have to do is call us at (770) 685-1777. Now also number three is Social Security income and Social Security income is either the number one or number two source of income for majority of Americans out there. It's also interesting to note that Ssa.gov and. Cbo.gov. The Congressional Budget Office. Both of them are predicting that Social Security, the social Security fund that funds OASDI. Is going to be depleted 100% by 2034, which would mean a 23% cut at a minimum, according to the Congressional Budget Office. And tsa.gov, where you'd only get 77% of your Social Security income benefit that you're getting today. So if you don't have a plan for that, I would encourage you to give us a call at (770) 685-1777. We're happy to help you again. You can just visit active wealth.com and click that schedule a consult button in the upper right corner. And then number four is any additional earned income during retirement, whether that's rental income or whether that's I'm going to go be a greeter at Walmart.

Cbs is doing a series or they've done a series that's on YouTube about retirees that are having to go back to work. And one or both spouses are still working even into their 80s And. It's pretty sobering. It's a pretty difficult thing to watch, but it's important thing to know. So do me a favor. Try to be saving at least 10 to 15% of your income. So that way you can put money away. You know, for the future, for your retirement. I just really, really implore you and invite you and encourage you and urge you to do that. Yeah, absolutely. So thank you, Linda, for your question. Next, David incoming asks simply how much will my income need to increase to keep up with inflation? I'm concerned with how much more expensive things have become to cost over the last few years. How much do I need to save to keep up with inflation? Yeah. David, thanks so much for the for the call. And I actually live in Cumming so. Hey neighbor, the cost of living as measured by the Consumer Price Index, which is CPI. And also there's a couple of different KPIs. There's CPI, Dash U, which stands for Urban, and that's what's called usually the headline CPI. That's the one they use and they quote on CNBC or Fox News or Fox Business and things like that.

And then. E is for the elderly. And believe it or not, that's 5% higher than CPI. You because of health care costs and housing costs and food costs. Those are all things that really affect retirees. So the cost of living as measured by the CPI has fluctuated, but as averaged between 4 and 5% per year over the last 20 years. We strongly recommend that retirees consider inflation when preparing for retirement. Also, you need to really run a retirement income gap analysis, and we can do that for you. You want to see if you're starting with a retirement income gap. That's a negative gap where you're still trying to make up with savings or even you're potentially going to debt finance that that gap so you can meet your monthly financial needs. Or do you have a retirement income surplus on a monthly basis, which we hope you do, but also regardless of what you're doing? If you've got a negative income gap or a positive income surplus, both will widen if inflation really kicks in. If you stay invested, it is really difficult if you've got negative credit card debt and then inflation is going and you've got more interest on the on that and you're also paying more at the grocery store or at the pump for goods, you're going to you're going to see your lifestyle dwindle and you see your purchasing.

You're going to see your purchasing power go down as well. So let's do everything we can to make sure that we're staying focused on that monthly income and expense budget. All right, next question. Sandra in Johns Creek is asking something similar. Will Social Security keep up with the cost of living? Yeah, here's the answer to that. I mean, Social Security has cost of living adjustments most years, but many retirees, no, this just doesn't make up for the true inflation that is affecting the products and services they use the most. We do not recommend relying on cost of living adjustments or colas to keep up with inflation considered guaranteed income strategies that can experience market like gains with principal protection. We even have clients there like, Hey Ford, I want to put enough money into an annuity so that I can pay for my Medicare surcharges that are coming out of my Social Security check and also cover any Medigap insurance costs that we may have. And then also remember, fixed index annuities grow like stairsteps. The worst you can do is zero and you get to enjoy the point to point protection of capturing the gains, but none of the market losses. So again, I would encourage you to reach out to us if you're concerned about your retirement income budget in the future, go ahead and reach out to us at Active wealth.com, Click that schedule consult button and we'll go ahead and get that scheduled on my calendar.

You can schedule directly into my calendar yourself. We only got a few seconds left here in Segment three. When we come back from the break, we're going to finish up with one last question from our listeners, from our activators out there, and then we're also going to come back and talk about common misconceptions regarding Social Security. We're so happy you're with us here on the Active Wealth Show right here on Am 921. The answer Come right back to learn more about the common misconceptions regarding Social Security and what you can do about them for your own personal retirement. There's a crazy little shack beyond the tracks. Everybody calls it. The two years of high inflation could warrant cutting back on entertainment costs. I'm Jim Tarabukin with the Retirement Radio Network. Powered by Amara, life inflation in times like these have triggered Americans to be more cognizant about their spending habits. A recent survey done by CNBC found Americans from all income brackets have begun to cut back on spending. Washington bureau chief Bankrate Mark Hamrick explains. People need to have a sense of hope when the economy is working for them. There's a greater likelihood that people will have hope that they can accomplish their basic personal financial objectives. And despite past recessions and examples of inflation, Americans have never been timid about spending money within the entertainment sphere. Sporting events and concert tickets have always been a hot item, but lingering inflation and impacts from the Covid 19 pandemic have shifted consumer priorities.

According to Morning Consult Economic intelligence data. Entertainment was among the categories that posted the sharpest year over year spending decline as of March 2023. The purchases of books and movie theater tickets underwent the steepest spending drops at a combined 58%, and about 1 in 4 US adults said they're either spending less on or have stopped paying for media and entertainment expenses altogether. So what are some ways you can cut back on entertainment costs, start sharing or cancel unused streaming subscriptions? Or you can research cheaper alternatives to sporting events and concerts in your area. Cutting back on entertainment costs. Part of our 23 cost cutters for 2023 for the retirement radio network Powered by a Mirror Life. I'm Jim Terebovlya and welcome back to the Active Wealth Show Activators. I'm Sam Davis here with Ford Stokes. And on this week's show, we're answering your questions. We are have already answered a few questions in the last segment, and we have one more that we want to get to today. And it comes to us from John in Suwanee, who writes in to ask, when is the best time to make withdrawals from my retirement accounts? When the market goes down? I'm afraid to make matters worse by pulling out money. But when the market goes up, I feel like we're getting in the way of potential gains.

I got to tell you, John, thanks so much for the question. Attempting to time the market and make systematic investments or withdrawals is something we get questions about all the time. This is why we spend so much time talking about the importance of a strong income plan and taking advantage of guaranteed income solutions like fixed index annuities. Quick question is do you really want to spend your retirement years watching the stock ticker and stressing about managing your money? I would encourage you to try to get invested. We like to sell on up days for sure. When you look to liquidate, usually we try to help help out there, but if you go too long, you could actually go into more of a trough and you could actually lose money. So the question is the practice is really try to do it in a 2 to 3 day period when you decide that you really need to liquidate some assets so you can fund something and take income. Also make sure that you have a move money form on file with your advisor. We have them with our folks so that way you can just send them an email or call them and then you can get your withdrawals. Usually we're able to get money to our clients out of their investment accounts within 24 to 48 hours. And now let's go ahead and share a few of the misconceptions out there regarding Social Security.

Almost everyone we meet with has questions about Social Security, and we understand choosing when to take your Social Security benefits is an important decision for every family, and in my opinion, it's really the most important decision you make during retirement is when to take Social Security. Let's clear up some common misconceptions about your Social Security benefit. Everyone's Social Security benefit is the same amount. Not true. It's based on how much money you've put into the Social Security program and how much money you've made over time and how many how much you've paid in taxes. That's going to determine the Social Security benefit that you're going to receive. Your benefit amount is fixed forever. That's also false cost of living adjustments. The SSA can reduce your benefits and they expect they may need to reduce everyone's benefits as early as 2034. The OASDI trust account is actually going to be depleted. And that's not my listen, that's not my conjecture here, folks. Those are that's coming directly from the Congressional Budget Office and from the Social Security Administration. You're stuck with the benefit offered to you. Again, that's not true as well. You have options If you delay the SSA, if you delay, the SSA will pay. You will make more money. And for every year you wait after your full retirement age, it's 8% more in income moving forward. And the break even analysis is kind of like this. If you let's say you decide not to take Social Security income starting at age 62 and one half and you go all the way to full retirement age, you really need to live up to about like 76 years old for that to really pay off for you.

But we're all living longer. So I would just tell you, it it makes sense as long as you're not putting too much pressure on your retirement. So you're not putting too much pressure with withdrawals from your retirement portfolio. You're going to be in a better spot if you wait a little bit longer if you can. We like to try to see people make it to their full retirement age and then go ahead and turn on income. You should draw from Social Security as soon as possible. We do not advise this unless it's essential that you need money as soon as possible. We recommend waiting at least until your full retirement age. Like I said earlier. Your benefit will increase every year. UnFordunately, no cost of living adjustments do not necessarily happen each and every year. If you want to schedule a complimentary financial and retirement consultation to receive your free Social Security maximization report absolutely at no cost to you. All you got to do is visit active wealth.com and click that schedule a consultation button and we're happy to meet with you. And now, Sam, you've got an interesting article on thinkadvisor.com that I thought was intriguing.

Yeah for this comes to us from Thinkadvisor. And the headline is Americans with Annuities Want more annuities. Americans who already own annuities or other products that provide guaranteed income love the idea of investing in additional annuities. The American Council of Life Insurers sponsored a recent survey of over 1000 US retirement savers aged 45 through 65. 26% of those survey participants said they already owned annuities, and 86% of participants who owned annuities said they were either somewhat or very interested in investing in additional annuities. 76% with pension plans and 67% of the participants with annuities said that they wanted to invest in annuities for the first time. Yeah, it's pretty remarkable. A lot of folks that own fixed indexed annuities, they like to ladder them. They like to get with the next one that's going to give them a bonus or give them a higher participation rate and with what's going on with the interest rate. Climbing right now with the ten year US Treasury. Annuities are doing very well because here's how annuities work. What they do is they're required to reserve 100% of the assets that you give them in a safe product like the ten year US Treasury. And then what happens is they. At the end of year one, they'll take the interest that's generated from that ten year US Treasury and they'll invest it into options, into an index. And they take a portion of the gains and they give you a majority or the lion's share of the portion of the gains.

And that's how they make money off of your money. But what else is nice is you get market like gains without market risk and you also get higher payout factors because you have something called mortality credits that helps you get a higher payment band each and every year. So you get like 0.1% more each year. That you age and you have your annuity also. One tidbit that another article has said that people with annuities, they actually live longer because they want to make it to the next check. It really happens. It's like year over year, month over month. It really happens. So I would encourage you to at least put 20 to 40% of your assets into a fixed indexed annuity. We do tactically managed portfolios. That's what our bread and butter. But we also try to replace the bonds in a portfolio with fixed indexed annuities or structured notes or a combination of both as our income strategy so we can get you a greater rate of return and a higher income payout that's beyond the traditional 4% withdrawal rate. And Sam, I think you've got this Week in History, a couple of really good tidbits. It's this week in history. Yeah, there's a couple that I definitely want to talk about this week on This Week in 1884, the first roller coaster in America opened up on Coney Island in Brooklyn, New York.

It traveled six miles per hour and cost only a nickel to ride. But after that, one opened, thousands of new roller coasters across the US opened over the next century. And here's one for you. Ford on This Week In 1903, the Ford Motor Company was founded by Henry Ford, as well as 11 additional investors. Ford is the top automaker on the Fordune 500 for five years in a row, and it's a top five automaker globally. Can you imagine being one of those 11 investors with Henry Ford? That'd be pretty good. Pretty good. Return on your investment. Yeah. Think they did just fine. It's the final countdown. So let's recap what you may have missed. It's the final countdown. We just really appreciate everybody being here this week with us. Thanks for listening. Active Wealth Show. We do appreciate you as an activator. We also want to help you invest and retire successfully. So also, remember, if you're. Really seeking information. If you're going to be a bear, be a grizzly about it. So on this week's show, we took a lot of questions from you, our activators, our loyal listeners. We really appreciate you. Hopefully we answered some questions about Social Security, how to get a little bit more tax free with your investments during retirement, with Roth IRA conversions or life insurance or both. We also talked about, hey, there's some misconceptions about Social Security and the importance of implementing a retirement income gap analysis and getting that retirement income gap analysis done.

So we're happy to help you do that and you can visit us at Active wealth.com and click that schedule a consultation button in the upper right corner and you'll get booked directly into my calendar and. We are also talked about how people with annuities want more annuities in this segment as well. So there's a really great show. Happy Father's Day to everybody out there. We sincerely appreciate you. Dads are working hard and sacrificing and providing for the family and. Just hope everybody really enjoys and has a great weekend. When we come back next week, we're going to talk more about how to implement a smart retirement plan with smart risk, smart, safe and smart tax solutions. We'll also talk more about the widow's tax or the widowers tax. We're seeing a few clients that are facing that. And good news is they had an income plan to deal with it. But I think you're really going to like next week's show. Happy Father's Day, everybody, and have a great weekend. Thanks for listening to the Active Wealth Show. You deserve to work with a private wealth management firm that will strategically work to protect your hard earned assets. To schedule your free consultation, call your chief financial advisor, Ford Stokes at (770) 685-1777 or visit active wealth.com. Investment Advisory services offered through Brookstone Capital Management, LLC BCM A registered Investment Advisor.

Bcm and Active Wealth Management are independent of each other. Insurance products and services are not offered through BCM but are offered and sold through individually licensed and appointed agents. Investments involve risk and unless otherwise stated, are not guaranteed. Past performance cannot be used as an indicator to determine future results. Fixed annuities, including multiyear guaranteed rate annuities, are not designed for short term investments and may be subject to restrictions, fees and surrender charges as described in the annuity contract. Guarantees are backed by the financial strength and claims paying ability of the issuer. Any bonuses mentioned may be subject to additional restrictions and regulations based on the offering annuity company. You may not receive the bonus if the contract is fully surrendered or if traditional annuitization payments are taken and if the policy is partially surrendered, it could result in a partial loss of bonuses because these are bonus annuities. They may include higher surrender charges, longer surrender charge periods, lower caps, higher spreads, and other restrictions that are not included in similar annuities that don't offer a bonus feature. Are you concerned about the Biden administration, how rising taxes could negatively impact your retirement? Then I encourage you to talk to Ford Stokes and his team at Active Wealth Management. Ford and his team of experienced financial advisors will help you understand the fees and risks involved with your current portfolio. Simply visit active wealth.com to book your free financial consultation and tell them Charlie Kirk sent you. Investment Advisory Services offered through Brookstone Capital Management, LLC BCM a registered investment advisor, not an actual client of active wealth management.

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