Ask the Advisors: We Answer Your Questions!

7.4.25: Audio automatically transcribed by Sonix

7.4.25: 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 hardworking 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 advisor, Ford Stokes.

Speaker3:
And welcome to retirement. Results. Result. Drivers on Ford Stokes to chief financial advisor. I've got Sam Davis here with us, who is our co-host and senior financial advisor. Say hello to everybody. Sam.

Speaker4:
Welcome to the weekend result drivers. Happy Independence Day weekend. Hope you're having a fantastic time celebrating this country's 249th birthday. We've got a big one coming up next year for the 250, but let's not wait till next year. Let's celebrate this year and hope everybody's having a good summer as well.

Speaker3:
I'm so glad that a patriotic president is going to be presiding over the 250 50th anniversary of our nation getting formed. Here we are now for the next one. So on today's show, we're going to be talking about what questions do you have about retirement? We're trying to answer those, but if you've got questions that you want us to answer, you can call us at (770) 685-1777. Again, that number 517. Seven, seven. We'll try to read those questions on the air, but also we're going to try to help you build a smarter plan for your retirement future. And on this week's show. We're going to go through all these different questions we've gotten from folks. If you're wondering who a result driver is to start. It's somebody that's looking to build a tax efficient, efficient and market efficient portfolio. Somebody who's trying to delete the advisory and portfolio fees for a portion of their portfolio, trying to eliminate those advisory portfolio fees on the income portion of their portfolio. They're also trying to delete the IRS from being their partner in retirement with a strategic Roth ladder conversion. We can help you do that, or you can just reach out to us at retirement results. Com forward slash plan. That's retirement results. Com forward slash plan. And we're happy to help you get started on that right away. We'll also give you a free registered social security analyst roadmap or Social Security maximization report.

Speaker3:
Absolutely no cost to you as part of our $2,500 value. So I'm going to walk you through everything you get from a $2,500 value on the front of the show. Number one is you get a portfolio analysis. Number two is you get a retirement income gap analysis. Determine whether you're going to start with a positive retirement income surplus or a negative retirement income gap. Third is we're going to give you that RSA roadmap that registered Social Security analyst roadmap, Matt McClure and myself are both registered social security analysts. And number three is we're going to give you a financial plan for your 95th birthday with your current plan. That has nothing to do with us. Number four is we're going to give you a financial plan, your nine fifth birthday with our recommended portfolios. And then we're also number five is we're going to give you a financial plan, your 90th birthday with our recommended portfolios. That also includes a strategic Roth ladder conversion plan. So you can delete the IRS from being your partner in retirement. We do all that planning for you for free at no cost to you. It's complimentary. It is a $2,500 value. All you got to do is call us at 7777706851777. We're happy to help you get started right away.

Speaker4:
Yeah, we've got some great stuff coming up on today's show. Like you said, we're going to open up that mailbag. We're going to answer questions written in by you, all the listeners. And if you do have questions, reach out to us at Retirement Results. Com or visit our firm's website active wealth. Com. Give us a call and give us a message there on our website. And whether you're on the verge of retirement, making the transition or already living through your golden years, we're going to have answers to a lot of common questions. Today, you're going to hear about a lot of common mistakes that retirees make. Some really easy things to avoid for if you just know those roadblocks that are coming up in your way, plus some strategies that can help boost your retirement confidence. So if you've ever thought, hey, I should ask somebody about this, or I should get these questions answered that I have about my retirement plan, well, chances are another listener asked that question and we're going to cover it on today's show. And that brings us to this week's financial wisdom quote of the week.

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, I would say, a pretty smart guy. Albert Einstein and Albert Einstein once said, if I had an hour to solve a problem in my life depended on the solution, I would spend the first 55 minutes determining the proper question to ask. For once I know the proper question, I could solve the problem in less than five minutes. And I think that this is not only an intelligent quote, this is just a very wise quote from Mr. Einstein figuring out, okay, if I'm asking the right question, then that's going to get me to the solution. Because if you're asking the wrong questions, you're not really going to get where you need to go. So, Ford, we're going to answer a lot of questions from the listeners today.

Speaker3:
It's good to get those questions answered correctly. It's kind of like the the carpenters like, you know, measure twice and cut once. So we want to kind of do that today. We want to help you better understand what's going on with your retirement plan, better understand different facets of retirement. You, whether you're in the accumulation phase or the accumulation phase where you stop working or you're retired or you continue to work or you relaunched your career, and then also what to do about that? And then also how do you pay less taxes over time during retirement with a Roth ladder conversion plan? Um, usually we convert Roth money, IRA money to Roth money over a 5 to 10 year period. Usually it's 5 to 7 years. Um, we can help you with some of that today. And, um, we'll also talk about how are you going to generate income. Also, what do you do with about the eventual loss of a spouse? Just a lot of different things we're going to cover on today's show. We're also going to talk about retirement facts. We're going to give you an update with the US debt watch as well. And Sam, go ahead with the first question.

Speaker4:
Yeah. This first question comes to us from Dave in Milton. David 64. Um, he's got a question. He wants to, you know, delay claiming Social Security, but he's worried about dying early and not receiving enough of the benefit that he's worked so hard to earn. So the question from David is, and by the way, we're removing all the last names and any two personal information from these questions. But David asks, is it worth waiting until age 70 to claim my Social Security? And for your registered Social Security analyst, what do you think about Dave's question?

Speaker3:
Yeah, I mean, delaying can increase your monthly check by like 8% per year each year that you wait from your full retirement age. So if you wait from 67 to age 70, you're going to get 24% more. The break even point usually is between 78 and 82 years young. Um, if you're trying to do that between full retirement age and 82 years old, if you're trying to wait between 62.5 and 67, you really need to live to be between 76 and 78 years old. To make sure that makes sense. The biggest thing to me is it's kind of like George Foreman from George Foreman Grills in the Boxer used to say is it's not what age you want to retire, it's what income you want to retire at. And so the biggest thing with Social Security, yes, it's important to get the full benefits paid back to you that you paid into Social Security. But it's much more important it helps you hit your monthly budget number. And so if you have savings to live on in good health, delaying can actually be a good choice.

Speaker4:
All right. Next question. We've got time for one more here in this first segment. This comes to us from Lisa in Roswell. Lisa is 62. Thanks for listening to the show. Lisa is still working part time, but she's considering claiming some Social Security benefits. Now we've got the first few questions are all related to Social Security. So Lisa asks, can I work and still collect Social Security?

Speaker3:
Yes, you can, but if you're under your full retirement age and earning more than, say, $22,320 and 2025 could temporarily reduce your benefits. And so be careful there. Also, withheld benefits are not lost. They're recalculated at full retirement age. And once you hit full retirement age, you can work as much as you want with no reduction.

Speaker4:
All right. And we actually do have time for just one more. This one comes to us from Ron all the way down in McDonough. Ron is 63. He's newly retired. He's a bit confused about taxes as it relates to Social Security, a bit frustrated with taxes and retirement in general. Um, but he's asking. Ron asks, do I have to pay taxes on my Social Security income?

Speaker3:
I mean, possibly it's it kind of depends on your age and all that stuff, but up to 85% of your benefit may be taxable depending on your combined income, especially if you're married. Filing jointly. Watch out for IRA withdrawals and other income sources that could push you over the threshold. We try to make sure that people try to stay below the threshold if they can. But if you're married filing jointly, you make over $44,000 a year. The government thinks you're wealthy and they're going to start kicking in the taxes on that. Um, also, smart tax strategies like Roth conversions can help minimize this over time.

Speaker4:
All right. And when we come back, you're going to get more questions from listeners to our show retirement results. If you missed the first part of today's show. We're already one segment in. Or if you'd like to go back and listen to previous week's episodes, find retirement results wherever you listen to podcasts, and we'll be right back with more questions from you, the listeners.

Speaker2:
Call (770) 685-1777 to schedule your free, no obligation meeting with us today. You're listening to retirement results.

Speaker6:
You can never die.

Speaker7:
You are going to see a crack in the bond market, okay? It is going to happen. And I tell this to my regulators, some of you who are in this room, I'm telling you it's going to happen and you're going to panic. I'm not going to panic.

Speaker3:
Did you hear that? That was Jamie Dimon warning all of us about serious trouble ahead in the bond market. Hi, I'm Ford Stokes, president of active wealth management and host of the Retirement Results radio show. If you're holding bonds in your retirement portfolio, it's time to rethink your strategy. Our team at Active Wealth can help you replace those bonds, avoid market risk, and still get market like gains without risking your principal. You could get a bonus on your investment. Enjoy gains when the market grows. Generate lifetime income during retirement, all without bond market exposure. Visit Active wealth. Com right now to schedule a free consultation that's active wealth.

Speaker1:
Com investment advisory services offered through Brookstone Capital Management, LLC, a registered investment advisor.

Speaker2:
Schedule your free, no obligation consultation today by visiting Retirement results.com. Now back to the show.

Speaker3:
Welcome back. Drivers on Ford Stokes, your chief financial advisor. I've got Sam Davis, our senior financial advisor and co-host with us. And we're just doing the mailbag here, folks. We're we're taking questions from our listeners. And you've got Cindy from Cumming, Georgia, where we live. Uh, Sam, go ahead and give us that question.

Speaker4:
Yeah. Cindy is 61. She writes in with some questions and concerns. Uh, she is divorced, but was married for a long time and never remarried. And Cindy asks, can I actually claim Social Security based on my ex-husband's work record?

Speaker3:
Yes. I mean, if the marriage lasted ten plus years, it has to be ten years and you're unmarried and over 62 years old, You can claim Social Security benefits based on your ex's work record. You'll receive up to 50% of their benefit, if higher than your own. It won't affect your ex or your current spouse's benefits.

Speaker4:
Yeah that's right. And next question. And this is the last one that we have today about Social Security. But Barbara is 60 and Barbara lives in Marietta as she is widowed and she's looking to maximize her benefits. Uh, Barbara is asking, can I take survivor benefits now and switch to my own later?

Speaker3:
Yeah. Barbara. First of all, I'm very sorry for your loss. And it's no fair and no fun that you lost your your loved one. Sorry about that. Next is. Yes. Uh, this is a smart move. If your own benefit will be higher at age 70. That's a good idea to do. Uh, survivor benefits can actually be claimed as early as 60 years young, but it'll be at a reduced rate or 60 to 67 for full benefits. Be strategic about when you want to switch to optimize your lifetime income. And also, Barbara, happy to help you. Make sure you give us a call at (770) 685-1777. Likely all these people are listening because these were like, long time listeners. And who sent us these questions. And, um, we're happy to help you again. Our number (770) 685-1777. Or you can visit us at retirement Results. Com we've got this schedule a consultation button in the upper right corner of our website at Retirement Results. Com and also the private wealth management firm's company website active Wealth. Com same schedule of consultation buttons there as well. Just go ahead and reach out to us and we're happy to get started to help you out there Barbara.

Speaker4:
Yeah it's a great place to go. One of those websites or give us a call at our phone number, which you'll also find on the website. And if this is something that you would like to learn more about your own Social Security benefits, reach out to us. You can contact us or click that Schedule an appointment button like you said, forward. And then one of us will give you a call, start to get the information we need, and put together that Personalized Social Security Maximization report prepared by one of our registered Social Security analysts. It is a free benefit that we provide to anyone who's listening to this show or listening to our podcast, so thanks for listening and we hope we can answer your questions about Social Security. So on to some other questions. We've got Jeff in Alpharetta. Jeff is 59. Jeff recently left his job and he has an old 401 K, and he's asking if he should keep his 401 K the savings for his retirement in that company plan, or should he roll it over into an IRA?

Speaker3:
Yeah, I mean, the simple answer is definitely roll it over into an IRA. Iras offer more investment, flexibility and control over the withdrawals. Uh, be cautious about fees, tax rules, especially Roth, versus a traditional IRA. And also, if you're between 55 to 59.5, you may want to leave the the fork where it is to avoid early withdrawal periods. I mean penalties, but you don't want to withdraw money. But what you would do is roll it over into an IRA. Regardless of your age, you can roll over an IRA at any time or a falling into your IRA at any time. Um, so it's only when you take withdrawals that you're going to see taxes or any, any penalties. One other interesting thing too, is if you take money out of a Roth IRA early, um, and or an IRA early before 59.5. Just be aware of that 10% penalty. Um, plus the taxes that are going to be at that income, the amount you withdraw will be added to the income that you have for that year. So you could be in a 24% bracket and paying significant taxes on that money. Be careful.

Speaker4:
Yeah. And what I would say to Jeff is that anytime you change jobs, it's a great time to reassess and do a smart inspection of your savings. You likely, uh, hopefully are leaving a job for another one with higher income. So update your income situation. It's a good time to revisit that budget. But I mean, we've done a lot of analysis for our listeners and those who reach out to us at Active wealth.com. I would say, you know, some of the best 401 K plans from companies maybe have a dozen investment options just by rolling it into an IRA. Whether you self manage it or you work with an advisor who can do strategic and tactical asset allocation for you. You're just going to have way more options. You're going to have the world of stocks, ETFs. You're going to be able to get into structured products if that's something you want to do. You could even roll over part of it into a personal pension for yourself. Some people leave jobs and that job didn't have a defined benefit plan. All they had was the 401 K, but you can actually self-fund your own pension if that's something you're interested in. And right around the time that you're changing jobs is a great time to look into that. So thank you, Jeff, for your question. And the next one is from Mike. Mike is 63. Mike's in Atlanta. He's considering retiring early, but he's unsure if he can afford to. He had some personal information that will remove, but Mike's basically asking, how do I make my money last if I want to retire early.

Speaker3:
Am I? First of all, you want to consider using a withdrawal strategy like the 4% rule or even dynamic spending, but you want to be really careful, but to not take out much more than 4% of your assets each and every year. Also, consider delaying Social Security to lock in more guaranteed income later, and also implement a bond replacement strategy because, you know, bonds are not doing well right now, they're to go forward p e ratio of over 135 to 1. So we would encourage don't take that reinvestment risk and the interest rate risk with bonds. Replace those bonds with fixed indexed annuities of your choosing to receive a bonus plus guaranteed income for life. And that can get you the higher income that allows your money to last, and you let the less the rest of your portfolio grow unencumbered by withdrawals and downward pressure from those withdrawals.

Speaker4:
All right. Next one is from Jennifer. Jennifer's 56. Jennifer is in Dunwoody. Uh, she's unsure about the differences between a Roth and traditional IRA. Uh, says I'm confused. What's the difference between Roth and traditional IRAs in retirement? I have both options through my work and want to know what's the best place to put my money?

Speaker3:
Yeah, especially if you're 56 years old. Jennifer, I would encourage you to go ahead and make the transition to Roth for. Okay. Um, you're going to see a little less money going into the Roth 4K every two weeks because your money is going in after tax. But the beautiful thing with the Roth for later, when it when you roll it over into a Roth IRA, the IRS will no longer be your partner in that retirement account. So that's a really good idea. Roth withdrawals are tax free and do not impact Social Security income taxation. So that's helpful. Um, traditional withdrawals are taxed as income and subject to RMDs at age 73. And you may want to consider a blended withdrawal strategy to manage your tax bracket as well. Um, but if you've got questions about that, Jennifer, we're happy to help you. Uh, we're about the same age. You can give me a call, give us a call over here at (770) 685-1777. I get it. A lot of folks are in their 50s. Have a lot of questions as they're nearing retirement. Um, and it's a really good idea to to get the answers to that sooner than later, because you might be entering into that retirement red zone that five years before retirement or the five years after retirement. You might be a little bit early in that regard, but if you're looking to retire right around 60, you're within that. So you just want to be careful and really get a good plan going. Uh, also, since you're over 45 years old, you've got access to invest in fixed indexed annuities like the nationwide Peek ten. They will take your money, um, and will invest it into the nationwide pick ten. If you're over 45 years old. Uh, Sam, you had, um, Julie, she's a pharmacist. And, um, and she actually invested on her 45th birthday. So, um, happy to help you, Jennifer. But I, you know, Sam's really good at at working with the younger folks and, um, and getting them access to really exclusive products for only 1% of advisors have access to, to present those to, to their clients.

Speaker4:
Yeah. Another thing I would say to Jennifer is it's not often that the IRS is giving you a pass and giving you a tax free investment option. The Roth is one of the only options you're going to have out there. So if you can take advantage of it and even make those catch up contributions as you work your way towards retirement, that'll go a long way. That'll be some of the most valuable dollars you have. Are those tax free dollars? We've got time for one more question in this segment for Rick writes in. He specifically says that he's 59.5. He wants to retire soon and just hit that penalty free age. He's wondering what his options are and what he should be doing now that he's 59.5.

Speaker3:
Yeah, you can now take penalty free withdrawals from IRAs and 401 is there Rick. Unfortunately, they're not tax free. Now only if you get Roth wrong K's they're rolled over into a Roth IRA or Roth IRA or life insurance. Those are the only things are truly tax free. Even municipal bonds. The interest for municipal bonds contribute to taxation on your Social Security and also for Medicare surcharges for that calculation. So be careful. They're also beginning. You really just kind of want to begin projecting your income needs, expenses and the withdrawal order to um, and also consider Roth conversions while you're in the lower tax bracket.

Speaker4:
Yeah. And I would say, you know, just because you can now start to make those withdrawals without penalty doesn't mean you should, um, if you're 59.5, you know, we have a lot of people who aren't retiring until they're maybe 63 or even 65 or older. Uh, take advantage of that time being on your side. You know, you can defer taking withdrawals and actually receive some really nice benefits from that. Give us a call. We'd love to talk to you about that, especially if you're anywhere around Ric's age 59.5. All right, Ford, we're going to take a quick break. When we come back, we've got more questions. You're listening to retirement results.

Speaker2:
We'll be back in just a moment to continue helping you navigate your financial journey. Stay tuned for more retirement results.

Speaker1:
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.

Speaker2:
You're listening to retirement results. And now back to the show.

Speaker3:
And welcome back to retirement results result drivers I'm Ford Stokes are chief financial advisor. I'm Sam Davis here with us. He's our senior financial advisor and co-host. And we are going through your questions. We're going through the mailbag this week folks. Happy 4th of July. Hope everybody had a great 4th of July. Um, this week and happy birthday. Happy 249th birthday to the United States of America. We love you. And way to go. President Donald J. Trump, there's all kinds of winning that you've been doing. And we're for the American people. We're pulling for you. And, um, and just really, really excited about our nation moving forward with one more year. And, um, it was the greatest nation on earth and super excited to keep going on these mailbag questions.

Speaker4:
Yes. Sandy is incoming. She's 67. She was offered an annuity at one point. She's unsure if it's a good deal. She's basically asking her opinion. She shared the details, but in general, she's asking, is an annuity a good idea for guaranteed income?

Speaker3:
I mean, we think so. We like to replace the bonds or the income portion of a portfolio that's generally invested into bonds. We like to replace those with fixed indexed annuities and kind of have a new 6040 portfolio. They're sandy. So it used to be that, you know, with modern portfolio theory not to go into too much of this, but you had Harry Markowitz in 1952 that created modern portfolio theory and basically stated that you can get an efficient investment frontier for your portfolio with 60% stocks and 40% bonds are kind of traded on the same exchanges, but as money moves out of equities, they'll move into bonds. That doesn't happen as much anymore. I think now, especially with interest rate risk and reinvestment risk, we're seeing a lot of people will invest into fixed indexed annuities for 40% or 20 to 40% of their portfolio. Uh, some annuities provide predictable lifetime income. They provide market like gains without market risk, and they're helpful for covering basic expenses. You may want to watch out for fees, surrender charges, and inflation protection. The type of fixed index annuity that we recommend you get is a fixed indexed annuity. Avoid the variable annuities we call those scannable don't do annuities. Don't invest in a variable annuity. Invest in a fixed index annuity or what's called a fire fire. That's what fixed index stands for fire. We think of this as a personal pension for you. And also it can give you a bit more options and customization as well.

Speaker4:
All right. Next question comes to us from Brian in Milton, Georgia. Brian wants to avoid market downturns in retirement. He isn't very excited about risk in the stock market. And Brian says, I want my retirement income to be a guarantee, but my pension, plus my Social Security isn't enough to live on.

Speaker3:
Well, one thing that may be a little bit of a curveball I would recommend. Brian, you call us at (770) 685-1777 to get your pension evaluated to get that pension x ray. And that way we can determine if you're better off actually taking the lump sum and getting a 15 to 27% bonus on that money. I mean, we can actually get you a 27% account value bonus. So if you'd like to make 27% more on the lump sum from your pension, we can help you do that. Day one. Um, also consider personal pension options from highly rated Fire or or fire or fixed indexed annuity carriers to fill your income gap. You can benefit also from market linked returns with principal protection and get those high participation rates in indexes like the Invesco QQ, the S&P 500, the the Nasdaq 100, the BNP Paribas Global Factor Index. The Credit Suisse momentum, just all kinds of different indices out there for you to choose from. And you can also get some fixed index annuity options out there. An example would be the SPDR Synergy Choice bonus um or this synergy Max that some include bonuses to give you a lift immediately like uh, a 15% lift on that synergy choice bonus, but also give you 75 to 113% participation rate and how the Invesco QQ index performs.

Speaker3:
We've talked about the nationwide peak tin on here quite a bit. Uh, nationwide, pick ten is offering a 20% income bonus, but they offer an 8% guaranteed interest on your income bonus and benefit base. And that bonus benefit base as well. But then they also offer you a 310% participation rate in how the BNP Paribas Global Factor Index performs. So that's extremely attractive because we've got clients that are doing very, very well over the last two years from their investment in the the nationwide peak ten, and we've got a lot of clients in there because only 1% of financial advisors have access to that product. So if you want to get an illustration, just see what it looks like. Anyone out there, not just you can you can really reach out to us, not just Brian. I mean, Brian is not the only one here that can get the answers. We can give you an illustration on the nationwide Big Ten, the SPDR, uh, the North American Charter plus 14. There's several investment options on the on the fixed indexed annuity side to replace your bonds. Just give us a call at (770) 685-1777 or visit retirement results.com and click that schedule consultation button in the upper right corner.

Speaker4:
All right. We've got some tax questions coming in from the listeners. This one is from Tim who is 72. He's in Sandy Springs. He is new to required minimum distributions. He's 72. So he's anticipating them coming up next year. He's unsure how to plan for them. And his question is how are required minimum distributions going to affect my taxes.

Speaker3:
Well they're going to push the taxable income up. They're going to make you pay more in taxes. But they're also going to give you money out of your IRA, um, to be able to help you pay those taxes as well. Rmds count as taxable income and can push you into a higher tax bracket. They also may increase kind of Medicare premiums and your Medicare surcharges and cost more of your Social Security to be taxed. Also, remember when you're taking Social Security and you're and you're also getting Medicare, they take the Medicare portion, the cost for Medicare out of your Social Security check. So just be mindful of that. A lot of people think they're getting that as a gross amount on their their, hey, I'm just going to get all that money that they're saying on my Social Security statement. That's not the case because they do take the Medicare, uh, charge out of the Social Security check before they send you the Social Security check. And you also want to consider them you consider qualified charitable distributions or QCD to offset the tax hit to if you want to.

Speaker4:
Yeah. And I would also say this is why forward when we're doing an analysis for anybody who gives us a call or goes to our website and schedules that free consultation we're looking at to see if a Roth conversion is something that's appropriate for them, because if you still have a few years until you hit that R&D age of right around 73 years old, then you have some runway to perform some conversions and actually start moving some of that money from your tax deferred bucket. Those IRAs, those 401 KS, those 403 BS, and get it into the tax free bucket where you can have no required minimum distributions and you have no taxes on the gains and no taxes when you decide to take it out, and no taxes if you choose to pass that along to a beneficiary someday after you die and go to heaven. So Roth is a great way to go. If you have time before your RMD age, uh, give us a call and we'd love to help you implement a conversion. Uh, the next question is from Cynthia. Cynthia is in Atlanta. She's 65. She's still working part time, but she's got some extra cash flow. Um, so good on you, Cynthia, for continuing to work into your 60s. Uh, she's asking, is it too late to start a Roth IRA?

Speaker3:
Not at all. It's never too late to start a Roth. As long as you have earned income, you can actually contribute to a Roth IRA. Um, also, hopefully if you're working in your W-2 employee, you could actually contribute to a Roth four, okay. And potentially get matching on that, which would be a pretty good idea. Um, Roth IRAs grow tax free and have no RMDs, making them great for later in life. And Roth conversions can also be a smart move before RMDs kick in at age 73. One big thing I would remind you of Cynthia. So let's say you've got $10,000 sitting in an IRA that that you want to withdraw from your IRA for to pay for accrues. You're going to have to pay ordinary income tax on that. So you're going to have to take out like 12 to $13,000 to pay for that $10,000 cruise. Whereas if you've got a Roth IRA and you want to take out $10,000 from the Roth IRA after the waiting period and everything else, the five year waiting period and you're over 50.5, guess what you only have to do is take out $10,000 to pay for that crew. So hopefully I'm helping you with cruising. Um, just assuming you that you want to take withdrawals on that. But I just do that as an example for retirees. But it is never too late to to actually start a Roth IRA as long as you have earned income.

Speaker4:
Yeah. And, you know, unless you're making, you know, well over $200,000, you shouldn't have any problem at all. And I think this is a great thing for anybody who is past that catch up contribution age and, you know, reinvest in yourself and continue to save for retirement and doing it on a tax free basis. That is a great way to go. Um, we've got time for one more question. In this segment forward, we're working our way through as many of these listeners submitted questions as we can. Uh, this one's more related to kind of some family topics. Nina is 61. She is from Johns Creek, and she's worried about long term care needs down the road. And Nina asks, do I need to have long term care insurance?

Speaker3:
If you have assets to protect? It can be worth exploring hybrid policies or setting aside a care fund or alternatives. A lot of people will self-finance their long term care needs with the sale of their house when they leave their home, to go into a long term care facility. We'd rather see the family home protected. We'd rather see the money for the proceeds from the family home protected. One thing, Nina. It's interesting. We used to have over 124 long term care insurance companies. Today there's 12 because they've they've founded a struggle to make money. Medicaid may be a fallback, but it also limits your care options. And you got to have no less no more than $2,000 sitting in the bank in assets if you're going to take Medicaid.

Speaker4:
All right. For next question is from Susan. She thinks it might be time to sell the house before retirement. We're going to get to her question right when we come back from the break. You're listening to retirement results. We're opening up the mailbag today. Come right back for segment for retirement results.

Speaker2:
We'll be back in a moment. But in the meantime, take a moment to schedule your free meeting with us at retirement results.com forward slash. Missed. Part of today's show. Retirement results is available wherever you listen to podcasts and online at retirement results.

Speaker3:
I'm Ford Stokes, your chief financial advisor. Got Sam Davis here with us. He's our senior financial advisor and co-host of the show. And Sam and I are going through the mailbag, and we are emptying the mailbag during this July 4th week. Um, and I want to I want to get full credit here. Sam, we are not doing a recorded show. We are here working. We are here taking care of business. And we're also here to celebrate the birthday for our our great nation. Happy birthday America! I hope everybody enjoyed their July 4th week, and I hope everybody's staying safe out there this weekend of the July 4th week. Susan's talking about downsizing. So I'm going to have you go ahead and share her question there, Sam.

Speaker4:
Yeah. Susan is 62. She's in canton. She thinks it might be time to sell the house. She asks, should I downsize before or after retirement?

Speaker3:
Downsizing before retirement gives you time, flexibility and possibly more profit. Housing markets are shifting, getting multiple appraisals before you list. I am not a real estate agent. I do not play one on TV or on the radio. Sam doesn't either. But don't forget to factor in property taxes, moving costs, emotional value, things like that. But one thing is, if you feel like your neighborhood is going to be flat because not all neighborhoods stay the same. If you feel like it's gonna be flat or they're going to go down, it's probably a good time to sell it, especially if you want to take care of that pesky last bit of your mortgage. It'd be a good idea to go ahead and do that. But imagine if you got, let's say you've got half $1 million sitting in equity in your home and you're or let's say net after you downsize, you've got $500,000 you're going to have left over after you buy a new place in that 55 plus community or whatever. Then what I would encourage you to do is to really consider investing that money, whether it's 50 over 50, like 50% of the fixed indexed annuity and 50% in the market, or maybe all of it into a fixed indexed annuity, because you if you had it invested into something that was fairly safe, like your primary family home, you may want to invest in something safe that's going to really grow and get you market like gains well beyond what the real estate market could get you. And you're also not paying property taxes on that additional equity either. So that's something to consider too. Bottom line is it depends. We'd love to help you consider that. But in my opinion, it's a really good idea to try to downsize a little bit before retirement and also get used to the lifestyle of where you're going to live.

Speaker4:
Yeah, I think that's a good recommendation. You know, we often talk with people about what their vision is for retirement. You know, what do you want to do? Who do you want to be with? Where do you want to live? And if you want to live somewhere that is not where you're currently living in the family home or where you're currently situated. You know, find that spot by the lake, by the beach, that mountain house, or that 55 and up community where you can, you know, continue to be really social and play pickleball and tennis and golf throughout retirement and figure that out and start to put that together. You know, it's not all about the finances and the taxes and retirement. It should also be about, you know, what you want to spend your time doing and where you want to be. We've got two more questions in the mailbag for the the bag is is getting empty. It's getting a lot lighter. And this one is from Kathy. She is 66. Kathy is in Dunwoody. She's worried about the national debt and how it affects her. So I actually looked it up. We are over $37 trillion in the US. Uh, as far as our national debt. Right now, there's a lot of talk about what's going on in D.C. currently about potentially raising the debt ceiling for the future. And Kathy asks, how will the national debt affect my retirement and potentially my future taxes?

Speaker3:
Yeah, I mean, unfortunately, deficit spending is a tax unto itself. Rising debt may lead to higher taxes, inflation, and reduced government programs. Generally. When you know the government prints money, that's going to make it where the currency is is worth less. So you're going to have inflation. Inflation comes from one place. According to Milton Friedman. It comes from Washington, D.C. in the United States of America, Treasury yields tend to rise with debt, impacting bond prices and interest sensitive investments. Uh, also, you want to consider diversifying and managing risk to buffer against market shocks. And let me just be really honest and direct and upfront on this one, Kathy. Number one is you really want to truly diversify, diversify between stocks, ETFs, insurance products like fixed index annuities that are there to insure against you living too long to give you an income your entire life that goes in within. Additionally, it kind of couples in there with Social Security as well. And you also want to, you know, make sure that you've got your house paid off. You're not paying a mortgage so it doesn't eat into your Social Security check or checks if you're married going into that. So be careful about that too. But national debt absolutely can affect you. It can it can really hurt your purchasing power and also lead to higher taxes in the future. But let's try to diversify and manage risk again to buffer against any ups and downs in the market.

Speaker4:
Yeah. And if the national debt has you concerned and you want to reassess the risk that's currently in your plan, we'll actually do an analysis for you and show you what your average level of risk is and what your average rate of return is. Compare the two and see if we can bring that into a balance that makes more sense based on your preferences. Last question in the mailbag for today comes from Larry in Woodstock. Larry is Area 64, and he's thinking about moving to another state for retirement, but he's not sure if he should maybe just stay where he's at in Woodstock. He asks the state taxes matter when picking where to retire.

Speaker3:
Yeah, they kind of do matter. Um, some states tax Social Security pensions and other IRA withdrawals. A lot of states don't. Georgia does not tax on Social Security. You may want to consider property taxes, health care costs and overall cost of living, too. If you're over 65, go ahead and file for your homestead exemption to kind of eliminate the children's education part of those taxes. It'll dramatically reduce your property taxes, um, that you'll pay. States like Florida, Texas and Tennessee have no state income tax, but that's just one factor. But if you move to Florida, you could have higher property taxes, but you're going to have 5% less in income tax. If you're if you're going from Georgia to Florida, we have a lot of clients who used to live and work in Atlanta that moved to Florida and move to 38. Some might move to Orange Beach and go down to Alabama. Even though we got like 4% state tax in Alabama. You may see a lot of people going to Ponte Vedra trying to be down there, play some golf and be on the Atlantic side. Some are going as far south as like Fort Myers. My wife and daughter right now are in Palm Beach, visiting down there at the Colony Hotel. It's a pretty neat thing he plays to go check out, and everything's really pink down there. And a lot of interior design, a lot of great shops and all that stuff. But I would just say, Larry, um, you know, consider trying to get to a tax free state. That's one. And then also just make sure that you're in a state at least that doesn't charge, um, state income tax on Social Security checks.

Speaker4:
Yeah, I think that's a fantastic recommendation. You know, take a look at all the factors, not just the income tax level in that state, but if you're going to own your home, what's the property tax like? You know, if you're going to live in a major metropolitan area, what's the cost of living like? You know, if you're living in Tennessee but you're living in Nashville. Things could still be pretty expensive there for you, so try to consider all factors and reach back out if you have more questions.

Speaker8:
It's the final countdown.

Speaker2:
So let's recap what you may have missed. It's the final countdown.

Speaker8:
The final countdown for it.

Speaker4:
As we kind of move towards the final countdown and the end of today's show, just want to let people know that they can start working with us today just by visiting retirement results.com. That's the name of our show Retirement Results or by visiting our firm's website, Active Wealth love to help you take a look at what your goals are for retirement. Take a look through your current plan. You know forward. We take a look at everyone's plan. We do a thorough analysis from multiple third party services, and we actually give them a grade on their plan. And then, you know, tell the folks what they get actually on our recommended plan side.

Speaker3:
So here's everything you get. Number one is you get a portfolio analysis. You understand the expense ratio within your portfolio. You also understand the risk level that you're taking as measured by standard deviation. Standard deviation is a measurement of risk in the financial world. And then also the correlation of your assets. So we'll make sure you understand all that with a portfolio analysis that is objective. It is not subjective. We run an institutional level Morningstar report that's extremely thorough. It's more thorough than generally what you would get if you're just trying to order one on your own. So we're happy to do that for you. Number two is you're going to get a retirement income gap analysis. So we're going to determine whether you've got a positive retirement income surplus or a negative retirement income gap. Number three is we're going to give you a registered social security analyst roadmap an RSA roadmap. So it's kind of like a social security maximization report. You can understand how much you could get in Social Security, give you the options of when to take especially for married couples filing jointly. Also let's say the the wife worked a good amount of the time, but not all the time. There's a really good idea to understand whether you're better off. She's better off taking the spousal benefit or taking her own individual benefit.

Speaker3:
So those types of questions, we can answer those. Also, should she start early, should she start her income early on her own benefit and then top it off when she reaches age 67, which is her full retirement age reminder for everybody, too. It does, you know, good to wait after age 67 to turn on your spousal benefit because you're not going to get paid any more because you're only getting paid up to the the spousal benefit of your spouse at age 67, their their full retirement age benefit. And and then the last thing is just your financial plan with your current plan and then one with our recommended portfolios with a Roth ladder conversion plan. Listen, we are so glad you've been with us here in this mailbag episode of Retirement Results. Hope. Happy birthday America and hope everybody had a happy and safe 4th of July. And remember, if you're planning for retirement, if you're going to be a bear, be a grizzly. Seek as much information as possible, and we're going to help you build that smart retirement plan so you can protect and grow your hard earned and hard save wealth for that successful retirement for yourself and for your family. Have a great week, everybody.

Speaker2:
Thanks for listening. Two 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 (770) 685-1777. That's (770) 685-1777. To connect with a qualified advisor. To learn more about our mission and our team, visit Retirement Investment Advisory Services offered through Brookstone Capital Management, LLC, BCM, a registered investment Advisor, PCM and Active Wealth Management are independent of each other. Insurance products and services are not offered through BCA, 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.

Speaker1:
Registered investment advisers 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 disclosures of any conflicts of interest. Please refer to our firm brochure, the advertised item for. For additional information.

Speaker4:
Welcome to the Retirement Results Bonus segment, just for our listeners on the podcast feed and on D1 up and around the lake. I'm here with Ford Stokes, our chief financial advisor. Ford, we've got some extra information for the folks who made it through this episode. And just a quick, uh, list of retirement facts and stats for 2025. First one that we're seeing, this is just kind of in the news this week. The retirement age is continuing to rise. So in 2025, the average retirement age in the United States is 62. This is steadily climbing from the low 60s in past decades. Uh, kind of would love to get your thoughts on that. And, you know, longer life expectancies and financial pressures are keeping some people in the workforce. Uh, but we do see a lot of people that want to retire young as well.

Speaker3:
Yeah. It doesn't surprise me. Right? You had so many people retiring early because of Covid. Now people are kind of settling in. They're also realizing, oh, wait a second. 2022 is a rough investment year and we need to keep going here. Um, also, again, kind of back to what we talked about in the main show with George Foreman talking about, hey, it's not what age you want to retire, it's what income you want to retire at. A lot of people are trying to hey, I want to squeeze out more income. I want to be out there a little bit longer. Um, some people also maybe relaunching into new companies, things like that, or buying franchises, stuff like that. So it doesn't surprise me. I think also a lot of us feel like we're going to live forever, pretty much. And unfortunately, none of us are immortals. But I do see people trying to stretch it out and stretch into trying to get to age 65 for Medicare and reduce that health insurance cost. That's a big factor, in my opinion.

Speaker4:
This next one here for it, I thought was interesting, because this is one of the reasons why we're so busy and why we do our show here on the radio and on the podcast. In 2025, a record number of Americans will turn 65. 4.2 million of you out there listening will turn 65. That is the largest single year cohort of 65 year olds ever. This is creating some interesting challenges and opportunities in the retirement market. And so forward for anybody who's right around there in their mid 60s, what would you recommend?

Speaker3:
Yeah, I would just say, you know, make sure you've got a plan and plan your work and work your plan a little bit. Make sure you're starting with that positive retirement income surplus to make sure that you've got enough income from your assets when you're in that decay phase to cover all of your expenses, let's at least make sure we get done doing that. Also, if you made it 65. Congratulations, happy Medicare day. It's good to make it to Medicare because it makes sure that your your health insurance is a lot lower cost. So let's be careful there and try to get a medigap supplement insurance plan to kind of take care of the other 20% or get a Medicare advantage plan. And that kind of helps with that as well. But you're going to have less utilization, gets a little bit more like an HMO rather than a PPO. But the number one thing I would say is let's look at trying to make sure our income is greater than our expenses starting out, because as inflation goes, that income gap could widen if we start with a negative retirement income gap versus a positive retirement income surplus. And one way to deal with that is to invest the income portion of your portfolio into fixed index annuities to try to overfill that income portion so you don't have to do withdrawals from the rest of your assets. That could let you get more than that traditional 4% withdrawal rate, because a lot of people find that Social Security plus a 4% withdrawal rate on the rest of their assets, they really need about another ten, 20, 40 grand. And the way to do that is to get a higher amount of income from a fixed indexed annuity with the payouts that they're offering now because they're having to compete for baby boomer dollars right now. And so those those products are getting more and more attractive for folks.

Speaker4:
Yeah. Another fact I thought was interesting. If you are 65 or older and you are still employed, you're actually one of 11.2 million Americans over 65 who are employed and still working. Many say they're working for extra income. Others say it's just to stay social and active for it. I know we recommend that people delay taking those Social Security benefits, and if you've been working in one career for quite a long time, it's likely that you're making more today than you were 30 years ago. Right? So every year you can work and replace one of those lower earning years on your Social Security record, you're actually paying yourself. Down the line. Not just by deferring taking your benefits, but by earning more. Now you're going to increase your benefit later. And so, you know, it is a great thing if you're able to continue to work over 65. A lot of people are concerned about, you know, getting hired again if they decide to quit their job or leave and so forth. What do you what do you say for all the folks who are continuing to work out there?

Speaker3:
I mean, good for you also. Keep you young, keep you going. Um, a lot of doctors tell they told my in-laws years ago like, hey, if you stop working, you're going to shorten your life a little bit because you're you're. Your body's just used to that work, and you keep going. Um, doesn't mean you have to work forever. But I would say it's a good idea to. Especially if you need the extra income. Uh, the other thing is, if you're having trouble making ends meet with just a 4% withdrawal rate. Getting that extra income and also being more social and and really enjoying working with younger people or enjoying with people that are your same age as your peers. You're going to work at a golf course or something like that. You could see a really great opportunity to do that. So it makes sense. And these make sense for you because it's your life. It's not our life. And we want to make sure you've got the best of all the worlds that you want.

Speaker4:
And those are our retirement facts and notes worth mentioning for this week's Retirement Results bonus segment. If you have any questions, feel free to reach out to us at Retirement results.com, or give us a call at (770) 685-1777, and we'll see you next time. On retirement results.

Speaker2:
Call (770) 685-1777 to schedule your free, no obligation meeting with us today.

Speaker9:
When the night has come. And the land is dark and the moon is the only.

Speaker1:
Not affiliated with or endorsed by the Social Security Administration or any other government agency.

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 than you would be paying during a 35 year retirement. Find out how much you can 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 Books on Capital Management LLC, a registered investment advisor. Visit retirement results for more information.

Speaker1:
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.

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