How Much Risk Are You Taking with Your Retirement?

8.16.24: Audio automatically transcribed by Sonix

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

Speaker1:
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.

Speaker2:
Welcome to Retirement Results, the national radio show and podcast for listeners like you who want to protect and grow their hard earned money. In a world filled with so much uncertainty and financial risk, we seek to cut through the noise and build successful plans for hard working Americans on their road to financial freedom. Retirement results is powered by Active Wealth Management, a team of fiduciary advisors who always place your needs first. And now your host. He's a registered social security analyst, member of the Forbes Finance Council, and author of multiple books on retirement planning. Here is your chief financial adviser, Ford Stokes.

Speaker3:
And welcome to retirement results. Results. I'm Ford Stokes, your chief financial advisor. I've got Sam Davis back with us from the 2024 Olympics in Paris, France. And we have got an action packed show today. Uh, we're gonna we're gonna talk about Sam's magical Olympic mystery tour. And then we're also going to have a new segment called Just Don't Do It. Sam's going to also share the financial wisdom quote of the week. We're going to have our problem solver. We're going to share the best and worst places, or specifically the best and worst states to retire in the United States. And we're going to play everybody's favorite financial game show, right or wrong, the Social Security edition. Sam, welcome back to retirement results. Welcome back stateside. And I think all listeners are dying to know what events did you go to? What was the experience? Let's take a few minutes here and share what you and Bailey and your friends kind of experienced over there at the 2024 Olympics. Yeah.

Speaker4:
Well, thanks so much. It does feel good to be back in the United States of America. I love taking a good trip to reset and see other places experience new things. But, you know, there's always my wife and I were talking about on the flight home. There's those things you appreciate when you come back to the United States, like, you know, consistent air conditioning and ice and just being able to communicate with your, you know, neighbors and the people around you. But it was fantastic. Ford. We made it over there the week after the opening ceremony. We were able to see a lot of events. Tennis. We saw the race walk happening through the streets of Paris by the Eiffel Tower. That was pretty unique to see people eight eight deep cheering for the race walk. We also saw a soccer match between Spain and Morocco. Unfortunately, Morocco beat the United States or else we would have seen the US in that one. But we did get to cheer on many US athletes including Noah Lyles in the track and field events at the Stade de France in Paris. And we even got to see some Americans win a gold medal and hear the Star Spangled Banner over there in Paris. And it was it was a remarkable experience. Beach volleyball may have been my favorite right there in front of the Eiffel Tower, but the Summer Olympics are a fantastic event. I've been watching them my whole life and cheering for the USA. I remember being a kid watching the Sydney Olympics with my mom on TV, sitting on the floor in the living room, and it's just it's fantastic. And we're already talking about future Olympics where we can go cheer on the United States. That's great.

Speaker3:
Stuff. I'm glad you were able to cheer on the US team to victory. Great stuff there. I am wearing my Throwback July 4th shirt. Basically my girls gave me in commemoration of you coming back. So we. And if anybody wants to see what our video looks like, you can always check us out at retirement Results.com. Also, if anybody wants to get started and say you know what, I need to go ahead and call forward and kind of call forward and Sam and get started on my retirement plan. All you got to do is visit retirement results. Dot com forward slash plan. That's retirement results.com/plan. You can also call us at (888) 814-0304. That number is (888) 814-0304. So let's kind of go through it here. We're going to um get started. Why don't you go ahead and share our financial wisdom. Quote of the week Sam.

Speaker5:
And now for some financial wisdom. It's time for the quote of the week.

Speaker4:
This week's quote of the week comes to us from one of our favorites, Will Rogers, the humorist and political commentator. And Will Rogers once said, even if you're on the right track, you'll get run over if you just sit there. And I love this one. Ford I'd actually never heard this one before from Will Rogers, but, you know, it's a good point, even if you're pointed in the right direction. If you're not building in that flexibility, you're not able to be nimble and make changes when necessary in your plan. You definitely could get run over.

Speaker3:
Yeah, there's no doubt about that. I don't think you should just stay the course and just hang in there. I think you should do more, and you got to make sure you've got a really good plan. You got to plan your work and work your plan for retirement. And remember, if you're going to be a bear, be a grizzly. I mean, be as aggressive as you can about getting information about your current retirement and investment plan. So example, if your current advisor is not sharing, you know, an institutional level Morningstar report with you about your expense ratio, the standard deviation, which is a measurement of risk within your portfolio over the last ten years. They're not sharing a quantity report that that shows you the performance of your assets since 2007, well before 2008. So in that 17 to 20 plus year time span. So you can get an idea of what your retirement looks like, because most of your retirements are going to are going to last 2035 plus years. You really need to get an understanding of the risk you're taking, the fees you're paying and the correlation of your assets. So Sam and I would encourage you to go ahead and reach out to us at (888) 814-0304. But specifically, if you're not, if you don't have an idea or you feel like you're on the right path, but you're just standing still like Will Rogers said it and you're not tactically managing your assets. In other words, you're not actively managing them where you're rebalancing on a monthly basis.

Speaker3:
We don't get paid on on trading fees. We we get paid for our advice and for us to manage the assets. So we're not incentivized to churn your account. We don't do that. What we strongly urge people to do is to try to get into more of a tactically managed portfolio, or a combination between strategic asset management and tactical asset management, so that you can not ride the lowest of the lows of the market and are the goal with tactical asset allocation, is to capture about 7,080% of the actual gains, and only capture about 30 to 40% of the losses. And the difference between that 70 and 80 and the 30 and 40 is really the magic of tactical asset allocation. We we do like to make sure that we're rebalancing on a monthly basis to the asset classes. They're going to do the very best that we feel like are going to do the very best over the next six months. If you don't have somebody that's talking to you like this and they aren't sharing what the expense ratio is within your portfolio, chances are you got a little bit higher in fees and you think you do within your portfolio. So Sam and I really encourage you to go ahead and reach out to us at retirement results.com/plan. That's retirement results. Com forward slash plan. Submit that information your name email and phone and we'll get started. We'll get started right away.

Speaker4:
For one of the things I love most about what we do when we work with people, whether they're a listener or a friend of a listener or a referral from from one of our other partners, is we really help people understand their money for the very first time and take an active role in actually planning their retirement. Because, you know, the odds are you've done some thinking about your retirement, but it's more so the things of what you're going to do, the people you're going to be with, those trips that you're going to take and what you're going to do with your grandkids. Right. But you're not sure how it is that you're going to get there. And when we're sitting down with people forward, I see people's eyes open. I see their jaws nearly hit the desk when they find out, you know, how much they're paying in fees. You know where they could be doing better, and then they start to get really interested. You know, how could I save some money on taxes? I'm really concerned that taxes could go up in the future. And and we were able to work with them through all of these different points. And once they understand their money for the first time, I feel like it's almost like a weight is lifted and they can enter retirement with confidence and really live out that vision.

Speaker3:
No question about it. And we also we want to help you avoid things like default risk and help you avoid reinvestment risk and interest rate risk with bonds trying to implement a bond replacement strategies as well. There's a lot of moving parts to a retirement plan. We've only got a couple of minutes left in this segment. I want to hold that. Just don't do it. Brand new segment for the beginning of segment two. But let me just tell you what you get when you meet with with us. So number one is you're going to get a portfolio analysis. It's an institutional level Morningstar report and a quantity report. It's quantity. And those are independent views and measurements of how your portfolio portfolio has performed over the last ten years. And over the last 20 years. You get an understanding of the risk you're taking, the fees you're paying, like we're talking about, because we give you a defined actual metric number, your expense ratio. We give you a defined metric number of your standard deviation, which is a measurement of risk. We also give you an idea of the correlation or top 20 holdings. Um, so and how they move together. So those are really important. Next we're going to give you a Social Security maximization report.

Speaker3:
As many people know, I'm one of 15 registered Social Security analysts in the state of Georgia. Um, I work in all 50 US states. We give all of our Social Security maximization reports away for free. So if you're about to turn 62.5 or you're 65 and you haven't taken Social Security yet, I would encourage you to go ahead and reach out to us at retirement results.com/plan. We'll get started on that. Number three is we'll give you a financial plan to your 95th birthday with your current plan. That has nothing to do with us. We're just going to say, hey, here's here's what it looks like for you over the next 30 plus years to your 95th birthday. Let us know if if you feel like you're confident in your current plan. Number four is we're going to give you a financial plan to your 95th birthday with our recommended portfolios. And then number five is we're going to give you a financial plan to your 95th birthday with our recommended portfolios. That also includes a Roth ladder conversion plan to delete the IRS from being your partner in your retirement accounts. You get all that as a $1,500 value. We do it all 100% for free for our listeners on the John Fredericks Radio Network and on Am 920.

Speaker3:
The answer? Appreciate all the long time listeners over the last five years on Am 920. The answer you guys are and gals are part of our family. We we just love working with so many folks and we our problem solver and our just don't just don't do it segment. Both of those are from listeners from this past week. And we'll share those in the next segment. But listen, if you've been listening to even if you've just been listening to us for the first time this week, I'd encourage you to reach out to us at (888) 814-0304 and get started. I mean, Tony Robbins says you haven't made the decision unless you take an action and you ought to take action and pick up the phone and give us a call and we'll get started. Come right back for segment two. We're going to have our just don't do it segment and our Problem Solvers segment. And in segment three we're going to play right or wrong the Social Security Edition. Come right back to retirement results on the John Fredericks Radio Network and Am 920 the answer retirement results.

Speaker2:
We'll be right back to learn more and schedule your complimentary retirement consultation, visit retirement Results.com. You're listening to retirement results. And now back to the show.

Speaker3:
And welcome back result drivers to retirement results I'm Ford Stokes, your chief financial advisor. Got Sam Davis our senior financial advisor with us. And we're so excited to work with so many folks in multiple states. We're now across eight states and over 20 stations. This show is airing on Saturday and Sundays. Um, and we're we're so excited to be able to to bring the great news of investing out there and how to invest the correct way for your retirement. We also want to announce that retirement results. Sam and I will be interviewed and be part of John Frederick's bus tour, which he calls Trucking the Truth. Um, going up and down the eastern seaboard. I think he's going to spend a lot of time in Atlanta and a lot of time or across the state of Georgia and a lot of time in Pennsylvania, because those are two big states for Donald Trump this coming election. Um, we're excited to be able to bring information about, for the campaign about what the differences is between the tax proposals, between the old Biden-Harris proposal, because Kamala hasn't come out with hers. And then also the Donald J. Trump proposals. I thought it was interesting, Sam, that Kamala copied Donald Trump on no tax on tips. I thought that was a really interesting, um, piece of plagiarism there. Um, and again, it was also interesting. I saw a, um, a really interesting video on TikTok that had CBS news vilified Trump 56 days before for that policy, and then celebrated Kamala Harris 56 days later for her announcing that policy.

Speaker3:
So if you don't think the media is biased, I would beg you to reconsider. So that was pretty interesting. Um, Sam, let's go ahead and just share our just don't do it segment. So we're going to start having this just don't do it segment at least once a month. Things that you really want to avoid, especially as you're a pre-retiree or a retiree with your money. The biggest concern I got a call from two different gentlemen that are friends and they both. It was on a conference call and they were both kind of duped. One and we'll change the names to protect the innocent, but let's just call these guys Billy and James. So Billy and James, Billy invested 40,000 and James invested 50,000 in a software business. The gentleman that that lived in their neighborhood had been successful in the software business before, and he was about to get an exit, but he hadn't gotten his exit yet, and he was looking for money because he wanted to he wanted to jump into the next venture early, and people felt like, well, we're able to jump into that early and it's a better situation. Well, a year later and he hadn't been communicating that the proprietor, the owner of the software business, hasn't been communicating with Billy or James. And they called me before they called an attorney to say what? What could they do? And they were the angel investors. And the. We got on a conference call with the proprietor, and I was just asking questions like, what's what's our stock worth all this kind of things? And turns out that the company never sold a thing.

Speaker3:
They bought some equipment. They tried to build some things. It's kind of a combination between hardware and software and a little bit of communications company on the industrial side. And he gave them the bad news while I was on the phone, that unfortunately, their shares were worthless and that he wasn't going to continue the business. And he thanked them for their support. But that was it. He hung the phone up, and then I just immediately told them, you need to go ahead and call an attorney. I can't help you from here. I'm so sorry. And they were extremely upset, as you would imagine. Um, we gave them recommendations on a couple of, um, litigation attorneys, and they were appreciative of that. And I told them to try to get their own attorneys as well, because we don't share fees with attorneys or anything like that. I didn't have a dog in the fight, other than I was wanting to help Billy and James and, um, and neither one of them wanted to be able to go back and tell their wives they're worth, you know, between, you know, a little bit over 2 million a piece. But if they'd only been worth a million, that would have been their withdrawal for the year. Please, please, please do not try to turn yourself into an angel investor. Just don't do it. Just do not try to do Reg D investments. Try to, because there's not a lot of regulation on those and there's not a lot of recourse to Billy and James are going to have um, unless that gentleman took a lot of money and salary and things for himself.

Speaker3:
I don't know the particulars of that situation, but it was an awful, awful call to be on. And, um, I just don't want to see any of you or any of our radio listeners losing money, especially when you. You're not going to go back to work. So let's avoid the angel investing. Let's avoid you know, the only way you can really be duped is if you've got some greed involved on your side. So if it if it sounds too good to be true, chances are it is a lot of the Reg D stuff that regulation D, there's not a lot of regulation on it and it's private placement. Also, some people are having difficult time getting money, even any stipend, income or anything out of private placements that are ten years and longer, um, and and come with a lot of risk. So I would say try to stay down the fairway. Let's try to stay with stocks and bonds and fixed index annuities and and you know, 99% US equities on the equity portion of your portfolio. Try to do a bond replacement with fixed index annuities instead of bonds. So you can delete the advisory fees and portfolio fees. Again let's just don't do that. Do not be the new angel investor. When you're a brand new retiree and you're not no longer working. So same. Your thoughts on that?

Speaker4:
Yeah. And you know everybody's got a different risk tolerance out there. You know Ford sometimes will have people come in and say oh they're very conservative. They don't want to have a lot of risk. But when we take a look at their portfolio, they've got everything at risk in the market. And then we have people on the other side that say, you know, they've got a higher risk tolerance. They're willing to, you know, take some bigger swings. But when you look at their portfolio, they've got way too many bonds in there. The important thing is if you're listening to this, is make sure your risk tolerance aligns with your actual plan. And it's okay if you have a higher risk tolerance and want to take some bigger swings. There are much safer ways to do that than just acting as an angel investor. Going into some of these private placements and these options that aren't regulated.

Speaker3:
Yeah, I agree. And, you know, Mark Twain and Will Rogers are both given credit for saying this Uh, they basically said, I'm much more concerned with the return of my principal than the return on my principal. Let's also try to follow Warren Buffett's two rules of investing. Rule number one is just don't lose the money. And rule number two is don't forget rule number one. And these gentlemen, Billy and James, they lost the money. And I want to make sure that we're doing everything we can to not lose the money. And that means we also work with high level custodians like Charles Schwab and Fidelity that are going to, you know, hold your money. They're going to be like the they're going to serve like the bank so that there can be no made off with your money situation with us, that we the retirement results and also active wealth management, we never take possession of your assets. You're not you're never going to write a check to Ford Stokes or Sam Davis or or active wealth management. You're just not you're going to write a check to you know, Charles Schwab for benefit of your name or and with an account number on it on the check and the memo line, or you're with directions on where to deposit it, or you're going to do a wire transfer into a, you know, a Charles Schwab account.

Speaker3:
We're going to make sure, you know, so we're going to make sure all this works the right way. So let's just make sure that we don't do private placement right now. And angel investing. Let's avoid that. Um, next week we're going to have another really good just don't do it. That um, is is kind of a really good problem solver as well. Um, you know, we're always trying to help people get a better understanding of their own personal economy. Part of that is also understanding your retirement income gap. We want to make sure that you've got a plan for what your monthly income is, and also what your monthly expenses are. So do Sam and I are favor try to take your last two months. So take like July and August when the end of the month comes, or due June and July. At those two months up together in total what your expenses were. And then compare that to your income and see if there's money you can invest into an investment account at the end of every month because you've got extra income. And that can grow over time and also grow your 4% withdrawal rate, or also grow whatever your fixed index annuity income payment could be for your own personal pension.

Speaker3:
We want to make sure that we've got a retirement income gap analysis thoroughly completed for you before you launch into any financial plan for your retirement. That's part of what we give you as well. It kind of dovetails in with that Social Security maximization report because we take your Social Security. We take your 4% withdrawal rate. We take any pensions or personal pensions that are generated by fixed indexed annuities. Or if you're in a pension, it's it's generated by a spia. A lot of our northeastern friends that are listening to us in Pennsylvania, Virginia and other states that they've got some pensions. I would encourage you, if you're also facing a decision between taking a lump sum pension and taking the, you know, and taking the actual income from the pension, I would really strongly encourage you to consider taking the lump sum pension with us and investing into a fixed indexed annuity so you can get up to a 26% immediate bonus and get 8% interest guaranteed, actually. So big deal. So we come right back for segment three. We've got our right or wrong. So we've got our problem solver. And we're going to give you that Social Security edition of Right or Wrong. Come right back. It's everybody's favorite financial game show.

Speaker2:
Learn more at retirement results. Com or by calling us today at (770) 685-1777.

Well I'm hot blooded. Check it and see.

Speaker2:
Are you concerned about rising taxes and how that could affect you and your family during retirement? If you have an IRA balance over $400,000, you could save six figures in retirement taxes that you would be paying during a 35 year retirement. Find out how much you could save today by scheduling your no obligation Roth conversion consultation with Ford Stokes of Retirement results. Learn more and schedule an appointment at retirement results. Com investment advisory services offered through Brookstone Capital Management LLC, a registered investment advisor. Visit retirement results.com for more information. While Washington's spending keeps growing, your retirement doesn't have to shrink, protect, and grow your hard earned money today by calling us at (770) 685-1777.

Speaker3:
Welcome back to retirement. Results. Result. Drivers. My name is Ford Stokes. I'm your chief financial advisor. I've got Sam Davis here with us, our senior advisor. So Sam, let's play right or wrong.

Speaker2:
Come on down as we.

Speaker5:
Test your financial knowledge in.

Right or wrong.

Speaker3:
So this week's right or wrong segment is going to be focused 100% on Social Security, because there's been a lot of information in the news about Social Security. A lot of stuff's being talked about and through the campaign as well. Um, Donald Trump actually tweeted out that Social Security income benefits shouldn't be taxed. Again, if you're thinking about voting. I know if you're listening to us, you're on a you're listening to a conservative talk news radio segment or station. Please, please, please do everything you can to make sure that you're voting for Donald J. Trump and make sure you get your family out to the polls. I'll give you a perfect example. Gray Stokes and Madison Stokes, they're 17 years old. They're my daughters. They turn 18 on October 18th, just in time for the November Fifth US presidential national election. They are going to get a chance to pull a lever for Donald J. Trump. So I just wanted to make sure that everybody is figuring out who they can get to vote out there, get them to the polls to make sure we kind of get started there. For sure. You need to vote with your retirement in mind. If you want a chance at having your Social Security income benefits not taxed, then I would encourage you to vote for Donald J. Trump for sure. Please vote Trump in November. Okay, Sam, I'm you're always the emcee for us for right or wrong. So I'm going to let you go ahead and take this right or wrong social Security edition game show away.

Speaker4:
Yeah, happy to do it. We get a lot of questions about Social Security. It's important to a lot of people's overall income picture. We're lucky to have you for our registered social Security analyst. And so I think this is a perfect segment for you I expect you to get a perfect score. We'll see what the listeners know about Social Security. But here's the first one. Under current Social Security law, full retirement age is 65, no matter when you were born. Is that right or wrong?

Speaker3:
Well, that is wrong. If the full retirement age for Social Security benefits in the United States is 67, for people who are born in 1960 or later. So if you were born after 1960, congratulations, your full retirement age is age 67. It's 66. For those born from 1943 to 1954 and 66 and two, four, six, 8 or 10 months for people born from 1955 to 1959. The retirement age increases by two months per birth year. What else is interesting, Sam? We were talking about taxation on Social Security income benefits. A lot of people don't know, but the first year that was ever passed, that Social Security income benefits could be taxed was actually in 1983, and it passed with bipartisan support because they were trying to balance the budget. Alan Greenspan and the Democrats actually gave a lot of pressure to Ronald Reagan to sign it. And that is when taxation on Social Security income benefits started. It was at 50%. And then later during the Clinton and Gore years, they upped it to 85% of your Social Security income benefit could be taxed. It would be great if we could get Donald J. Trump in the white House, and he figured out ways to get rid of taxation on Social Security income benefits that people have already paid into the system.

Speaker4:
Yeah. And the important thing is understand that your full retirement age is based off of when you were born. But it's also important to try to get to that full retirement age before you start taking those Social Security benefits, because we already know you're going to get taxed on it. But we want you to get as much of every dollar you've put into Social Security out as income in retirement.

Speaker3:
Amen.

Speaker4:
All right. And the next one forward. In most cases, if I take my benefits before my full retirement age, they will be reduced for early filing. Is that right or wrong?

Speaker3:
That's right. You can start receiving benefits as early as age 62. But if you choose this option, your benefit amount will be permanently reduced. The reduction is based on the number of months you receive benefits before reaching your full retirement age. The exact reduction will vary depending on your specific full retirement age and that benefit which is based on your birth date for your full retirement age. Now, obviously, if you're born after 1960, it's going to be age 67. So my question is, do you feel like you deserve more than $0.70 on the dollar? And that's going to happen if you take Social Security income benefits starting at age 62.5. We'd like to see people get to their, um, full retirement age. That's a much better situation.

Speaker4:
All right, Ford, here's the next one. Is this right or wrong? If I have a spouse and he or she passes away, I will receive both my full benefit and my deceased spouse's full benefit. Is that right or wrong?

Speaker3:
Unfortunately that's wrong. Uh, Social Security will continue to pay the benefits of a surviving spouse after one of them passes away, but only the larger of the two benefits will continue to be paid. Payments for the smaller benefit of the two will cease immediately after the death of the first spouse. So let's just talk about some math here. So let's say there's a gentleman named Jim. So let's say Jim has got $30,000 in a Social Security income benefit per year. Well, the next thing is his wife, who stayed at home and took care of the kids and worked harder than he did. She's going to get half of his at her full retirement age, and her full retirement age benefit is going to be $15,000 in this example. On the day he dies, she gets his at $30,000 and she loses hers. She loses $15,000. That's coming into the household every single month. So she's losing 33% of the Social Security benefit income that's coming into the household. And if she has a mortgage that didn't change her trash bill, didn't change her water bill might change slightly, her power bill might change slightly, but a lot of those expenses are going to remain the same. She's going to have to travel more to see family and friends. It's just a real problem. And so what I would encourage you to do is just to reach out to us, and we'll get started on your Social Security maximization report. All you got to do is call us at eight, eight, (888) 814-0304. That's (888) 814-0304. And we're happy to help you.

Speaker4:
All right, Ford. And we've got one more here on right or wrong. Based on the government's most recent calculations, Social Security benefits could be reduced by 20% or more for everyone by 2035. Is that right or wrong?

Speaker3:
Unfortunately. That's right. The from Tsa.gov, the winner of the 2024 presidential election, will face a Social Security trust fund rapidly approaching insolvency. The program's trustees are projecting that the Old Age Survivors Insurance Trust Fund, OAC, will deplete its reserves by 2035, when today's 58 year olds reach the normal retirement age in today's youngest retirees turn 72. So that is right. Unfortunately, that doesn't mean that Social Security is going to completely go away. It just means they're going to be a 20 plus percent across the board cut of Social Security income benefits if Congress does nothing about it. I believe that Donald J. Trump is going to do something about it. I think he's also going to help out and reduce or eliminate the Social Security taxation. I think that's remarkable. And if you're a retiree or pre-retiree going to receive or already receiving Social Security income benefits, I would strongly urge you to consider voting for Donald J. Trump for to be our 47th president of the United States in November.

Speaker4:
All right. Ford, and when we come back, we're going to do our problem solver of the week. And we're also going to share with you a recent report of the best and worst states to retire in America. You're listening to retirement results. Come right back.

Speaker2:
Thanks for listening to retirement results. Schedule your complimentary financial consultation now at retirement Results.com down.

That's cool. Tonight. Share the spotlight. That's right.

Speaker1:
Do you want a steady stream of income for retirement? Then it's time to consider annuities. I'm Matt McClure with the Retirement Radio Network. Powered by Amira life. Gone are the days when most employers offered pensions with guaranteed lifetime payouts to their workers. But what if I told you that you can build your own personal pension? It's possible with an annuity. An annuity is a financial product that provides a series of regular payments to an individual over a specified period of time, often for the rest of their life.

Speaker3:
There are several options for you to consider when choosing an annuity. Be confident in knowing that there is an annuity out there that can meet all of your needs.

Speaker1:
Ford Stokes is founder and president of Active Wealth Management and author of the book annuity 360. There are several different types of annuities, including fixed, variable, and fixed indexed.

Speaker3:
A fixed annuity offers a specific guaranteed interest rate on their contributions to the account. A fixed index annuity is an accumulation based product offered by an insurance company. The growth of your fixed indexed annuity is dependent on the performance of a chosen stock market index, but your money is not actually invested in this index. This offers you great growth potential and exceptional protection for your investment.

Speaker1:
While each can provide tax deferred growth and a lifetime income stream, variable annuities put your principal at risk in the market.

Speaker3:
If you are currently investing in a variable annuity, your funds could be in serious trouble if the market experienced any downturns.

Speaker1:
With so many possible choices to consider, it's essential you speak to a financial advisor or professional to help you make the best decision for your future. So are you ready to consider an annuity as part of your retirement plan? It's a key question to consider as you approach what should be your golden years with the Retirement Radio Network powered by Amira Life? I'm Matt McClure For 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 bonuses if the contract is fully surrendered, or if traditional annuity 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, or other restrictions that are not included in similar annuities that don't offer a bonus feature.

Speaker2:
Miss. Part of today's show retirement results is available wherever you listen to podcasts and online at retirement results.com.

Speaker3:
And welcome back result drivers. I'm Fort Stokes, your chief financial adviser got Sam Davis here with us, who's our senior financial advisor and co-host on this retirement results radio show presented by Active Wealth Management, our private wealth management firm. Let's go ahead and play our problem solver.

Speaker5:
It's time for this week's Problem Solver.

Speaker3:
You and I met with John and Kim, and there they've got about $3 million in total assets. They sold their home and they went smaller. They bought in a 55 plus year old community. They had $500,000 in non-qualified money that they wanted to generate income from, and let the rest of their assets kind of grow. What's amazing is they took $500,000, invested it into the nationwide peak ten. They had the option of doing the North American charter plus 14. That's a little bit more of an accumulation product that had a higher bonus of 26%, but it had a 0.95% fee. Um, they they chose to go with the nationwide peak ten based on the track record and how the index has done that. Bnp Paribas Global H factor index is performing. They were able to get a 325% participation rate in the BNP Paribas Global H factor index. There are 500,000 was immediately worth $600,000 in the income account. Within that annuity, it estimates a 12.54% average annual rate of return. There's a two year point to point or what we call a two year protection period. But what was interesting is for John and Kim, they can generate $55,264 in income in year four of that policy, which is well over 10% of their original premium. So that was what they were looking for, because they want to get a much better income rate than the typical traditional 4% withdrawal rate. If they did, a 4% withdrawal rate would've been 20 grand. So they're getting $35,264 more from the fixed index annuity than they did if they if they just put it in bonds and, and said, okay, I'm going to take income from this and take 4% every year, that's a remarkable result for them.

Speaker4:
It absolutely is. And especially when you consider that that income is going to come on a guaranteed basis for them and essentially serve as a personal pension. And in this situation, they didn't have any pension like income coming into the household. And so to kind of get to the guarantees a little bit with their plan and start to replace their paycheck, that's something that was really attractive. And and this isn't something that you have to use the majority of your portfolio. I mean, typically we're only looking at a 25 to, you know, 50%, you know, replacement for part of your portfolio. And then you get this income you can count on for your retirement.

Speaker3:
No question. And, you know, if you want to be more conservative, you can try to look at 20 to 40% of your portfolio and do a traditional bond replacement and replace the 60 over 40. Portfolio with a new 60 over 40 portfolio instead of 60% stocks and 40% bonds. Try 60% stocks and 40% fixed index annuities and you'll be in a much better spot. I just strongly urge and encourage people to consider doing a bond replacement and also a bank CD replacement as well. I mean, this this interest rate is much higher. They also get a guaranteed 8% interest roll up into the income account each year. They defer withdrawals, which was really huge for them to get to that point in year four. So pretty excited about this for John and Kim. And uh, good job there, John and Kim and making the right call and the right decision there. But we just wanted to share that problem solver. Now, we also want to share the best and worst US states to retire in. Sam, go ahead and lay this on. And also this came from Bankrate.com. Yeah.

Speaker4:
That's right. This report's coming from Bankrate just a month ago, and we're taking a look at the best and worst states to retire in 2024. And they took a number of different things into account, like affordability, overall well-being for seniors, quality of health care, whether that's an important one. They only weighed whether about 10% into their their calculations here for me for it, it would definitely it would definitely weigh higher. I like the the better. Whether we get down here in the South they also factored in crime. Um you know so this is a look at the top five and the bottom five. So let's first kind of take a look at the bottom five. Um Alaska came in at last followed by New York at 49 Washington California and North Dakota. So we've got some big populous states in that bottom five with New York and California, also Washington, you know, high taxes in those states and not the best weather, especially for for New York.

Speaker3:
Yeah. Well, I'd say yeah, New York can be tough. California's got some great weather for sure. North Dakota is probably it was all weather for the reason they, they weren't considered, uh, they were considered in the bottom. But what's interesting is the majority of those are blue states that are run by Democrats with high taxes. And, uh, it just I just don't there's so many people that I meet that moved from California to Georgia or moved from California to Texas or moved from California to, like, the Carolinas, uh, where we've got some radio stations also, even in Virginia, um, in Tennessee got a lot of them. And we've got radio stations in Nashville and in Memphis as well. And shout out to you folks. Um, it's just really interesting to me that, you know, you've got blue states that have got high taxes that don't make any sense. And, you know, they're they're they're mismanaged and they're run poorly. And the crime rates are high. The taxes are high. It's just a real shame. And they're ruining some great, beautiful states. I mean, I've been to Washington State. It's it's unbelievable. That place is so bright, so pretty and so green. Um, and California's got incredible weather. I'm more of a Northern California guy, even though I've lived in Southern California, um, early in my career, I would never live there again. Like, never.

Speaker4:
Yeah, there are some incredibly high tax rates in those states. You know, there are definitely some benefits. Some big major US cities, some great weather. But you got to take a look at what you're getting for it, especially if you're entering retirement. You know, where do you want to call home for the next 20, 35 years or even longer? Um, but transitioning to the top five states for retirees in 2024. Coming in at number five is Missouri. Number four, South Carolina. Uh, our home state for Georgia came in at number three. West Virginia, we've got a lot of listeners in West Virginia is number two. And Delaware, certainly some tax benefits in Delaware came in at number one on the best states to retire in 2024.

Speaker3:
I'm surprised that Florida wasn't on there. Um, with tax free states and also Texas as well. And shout out to West Virginia for making the list. Super proud of you folks. So that's probably a lot because the great people that are in the great state of West Virginia. Uh, we love working with our folks in West Virginia. And again, if you want to work with us, all you gotta do is reach out to us at (888) 814-0304. That's (888) 814-0304. We look forward to working with you and helping you plan for your retirement. You can also visit retirement Forward slash plan. That's retirement results. Forward slash plan. We're super excited to to be part of the Trucking the Truth bus tour with Godzilla himself with John Fredericks. And I'm super excited to do that. And now the final countdown. So on today's show, Sam is back. He gave us some great information on his trip with he and his wife Bailey to Paris and and the Olympics. That was great and way to pull the US through on so many events there. Sam, as a spectator, um, we had our just don't do it segment where we shared, hey, don't do private placement and don't try to be an angel investor if you if you can't take on that kind of 100% default risk. And we got our problem solver with John and Kim, who sold their home and downsized and they took $500,000 in cash, put it into a fixed indexed annuity, and generated $55,264 a year and starting in year four, and they got an immediate 20% bonus into the income account, and they were looking at a 12.54% average annual rate of return as an estimate within that illustration.

Speaker3:
And they're super excited about their policy. And they were happy to also replace any bank CDs or bonds that they would have bought with that money. And we just shared we did a right or wrong for Social Security. And that was a really informative, action packed right or wrong about Social Security and what's going on there. And then we also had our best and worst states, and we just did in this segment in which to retire. And shout out to West Virginia and Georgia for making the list of the states that we actually air our radio show in. Super excited for both of y'all. And thanks for being so gracious and wonderful. Um, in those states. And we always love all of our listeners. We're so thrilled to be across eight states and 20 stations. And remember, if you're seeking information about retirement, if you're going to be a bear, be a grizzly. Be aggressive about getting information on retirement. Go ahead and reach out to us at retirement results.com, or call us at (888) 814-0304 to get your free portfolio analysis and financial plans your 95th birthday. That also includes a Social Security maximization report. All you got to do is reach out to us at retirement results.com/plan. Put your name, email and phone and we'll get started right away. Next week we're going to talk about more strategies on how to build a smart retirement plan right here on retirement results. Have a great week everybody.

Speaker2:
Thanks for listening to retirement results. You deserve to work with an independent team of fiduciary advisors that will strategically work to protect and grow your hard earned assets. To schedule your complimentary financial consultation, call us now at 1777. That's 770685. 1777. To connect with a qualified advisor. To learn more about our mission and our team, visit retirement Results.com. Investment advisory services offered through Brookstone Capital Management, LLC, a registered investment advisor 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. Registered investment advisors and investment advisor representatives act as fiduciaries for all of our investment management clients. We have an obligation to act in the best interest of our clients and to make full disclosure of any conflicts of interest, if any exist, please refer to our firm brochure, the ADV Two-a, page four. For additional information.

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