On this week’s show, Ford and Sam share two quotes of the week before providing a travel update for Memorial Day Weekend. Plus, we dispel common retirement myths and give some important information on Social Security for 2024 and beyond.
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5.26.23: Audio automatically transcribed by Sonix
5.26.23: this mp3 audio file was automatically transcribed by Sonix with the best speech-to-text algorithms. This transcript may contain errors.
Producer:
Any examples used are for illustrative purposes only and do not take into account your particular investment objectives, financial situation or needs and may not be suitable for all investors. It is not intended to predict the performance of any specific investment and is not a solicitation or recommendation of any investment strategy.
Producer:
Welcome to the Active Wealth Show. With your host, Ford Stokes, Ford is a fiduciary and licensed financial advisor who places your needs first. He'll help you protect and grow your wealth. The Active Wealth Show has grown because activators like you want to activate their retirement planning with sound tax efficient investing. And now your host, Ford Stokes.
Ford Stokes:
And welcome to the Active Wealth Show Activators. It's a special edition of the Active Wealth Show right here on Memorial Day weekend. We hope everybody and their families has a happy and safe Memorial Day weekend. And also just want to say that. We're doing a new show this week. We're not taking a week off. We're here for you, the activators. We're here to help you protect and grow your wealth. And in fact, the title of today's show is Protect and Grow for a Happy Retirement. And I just want to say thank you to all the men and women of the armed forces, whether you're a veteran or you're actually an active duty. Just thank you for keeping us safe. Thank you for keeping us free. We appreciate you. And Sam, say hello to everybody.
Sam Davis:
Welcome to the weekend activators. Hope everybody is enjoying the unofficial start of summer Memorial Day weekend. Get outside. I think it's going to be a little bit cooler in the Atlanta area this weekend. So enjoy the sunshine and time with the loved ones.
Ford Stokes:
Absolutely. So on this week's show, Sam is going to share our financial wisdom quote of the week. And I think it's really good. We're we're going to give you a bonus quote this week, too. And we've also going to talk about. Memorial Day weekend. And we're going to share some travel information and gas price updates for you. And in segment two, we're going to play right or wrong. And we've got some updates on the debt ceiling. And also we've got really a shocking stat of what's going on with household debt in the United States. And again, we want to make sure that you're trying to do everything you can to save money and not live beyond your means, live within your means. And we're going to talk about the impact of withdrawing your retirement savings, early financial moves that can reduce stress. So, Sam, go ahead and share our two not one, but two financial wisdom quotes of the week.
Producer:
And now wholesome financial wisdom. It's time for the Quote of the Week.
Sam Davis:
All right. This first quote comes to us from well, if you enjoyed watching college basketball in the 1970s and the 1980s, you probably remember this guy, Bobby Knight. And Bobby Knight once said, the will to succeed is important. But what's more important is the will to prepare.
Ford Stokes:
Amen. And I think all of us really need to work hard to prepare for retirement. Whether you're a pre-retiree or a retiree, you might be already retired. So many folks enjoyed our interview with Josh Leumi, with Amira Life and and also we talked about the nationwide peak ten fixed indexed annuity. And Sam, do you want to share how folks can get access to that interview?
Sam Davis:
Yeah, we got a fantastic response from all of the activators and a lot of new listeners to the Active Wealth Show as well. And if you missed that episode on Am 920, the answer Check out our podcast. Wherever you listen to podcasts, just search the Active Wealth Show and you should be able to see the whole episode as well as just the interview with Josh Leumi. That was a good one where we were talking about the nationwide peak ten. So check it out.
Ford Stokes:
Yeah, the nationwide peak ten is a fixed indexed annuity. It offers a 20% bonus and also offers a 315% participation rate in the Global Factor Index. It's brought to you by BNP Paribas. There's a lot of indexes out there that that are tied back to different annuities that are indices that are linked to different fixed indexed annuities. There are hundreds of them with hundreds of different products in the United States. And that BNP Paribas Global Factor Index follows global health care, which is a pretty good idea for retirees to kind of follow global health care with a portion of their assets. So you can kind of keep pace with inflation but also generate important income. They've got enhancements to that product. And if you want your own annuity x ray or you want to get an understanding of whether you should take a lump sum on your pension or not, there's about 14% of all Fordune 500 companies still offer a pension. But if you're in the process of retiring, we've got several folks that we work with that have had pensions that they took, decided to take the lump sum pension. But we can do the analysis for you on that as well. But if you want to build your own personal pension, you can just reach out to us at (770) 685-1777 again (770) 685-1777. Diane and Deborah are available to take your call. We'll also talk to you on Tuesday right after Memorial Day, if that works for you. All you got to do is, again, give us a call at (770) 685-1777 or you can visit active wealth.com that's active wealth.com and click that schedule a consultation button in the upper right corner And now Sam you've got some really great information regarding travel information for Memorial Day weekend.
Sam Davis:
A gas price update to get us started for Memorial Day 2023. The national average for a price of regular unleaded gasoline this weekend in the United States is $3. And $0.54, a little bit less here in the Atlanta area, a little bit below the national average for sure. And here's a look at the top five most expensive states to fill up Memorial Day weekend. And if you're trying to guess, driving around in the car, think west of the Rocky Mountains, because all five of these states are on the western half of the US. Number one, California, $4.80 a gallon. No surprise there. Everything's a bit more expensive on the Golden Coast.
Ford Stokes:
The sunshine tax for sure.
Sam Davis:
Hawaii, $4.75 a gallon. Arizona, $4.62 a gallon. Washington at 461 and Nevada at 424.
Ford Stokes:
It's surprising to me that Arizona and Nevada are so high they're not that far from Texas. It's just crazy.
Sam Davis:
Yeah. And a reminder, expect some travel delays on Memorial Day weekend. Millions are preparing for the unofficial start of summer despite recent gas price increases. We're still a bit lower than this time last year, 37.1 million Americans will drive to their destinations this weekend, according to Triple A. Additionally, transportation on trains and buses is up by 21% over year from 2022. And the Triple A travel forecast comes just a week after Airbnb reported record high bookings in the first quarter of 2023, according to a survey in February by US Travel Association, 23% of Americans plan to travel for leisure in 2023. So we're a few years separated from 2020 and the Covid 19 pandemic, and people are ready to get out there for.
Ford Stokes:
Yeah, no doubt. I'm sure folks are wanting to get out there and and get away from their home. One of the big things that I've seen that several experts are talking about even during retirement, is trying to spend more time out of the home. Try not to just spend so much time in the House. It also is going to lengthen your life as well. So if. You're a retiree or pre-retiree. I mean, go out to a park. It's free. Other than the gas money, get out there and walk. The one thing that Al Roker and Willard Scott, when they do the when they did the Smucker segment and I think Al's still doing that where he would interview. 100 year old people and above and also recognize people on their 100th birthday. The one thing they had in common is they all walked. And so I want to make sure that you're getting out and walking and moving. That would be a really good idea. And Sam, if you could share the second financial wisdom quote of the week.
Sam Davis:
All right. For this next quote comes to us from Joe Moore. And he said, A simple fact that is hard to learn is the time to save money is when you have some.
Ford Stokes:
Amen. It's just time. When you get money, you need to save it. And I would encourage you. Well, we tell our clients is pay yourself first. So take the 20. Take 20% and pay yourself first. Also for you business owners out there. We're meeting with business owners every single week. And I got to tell you, almost 100% of them don't have a simplified employee pension set up for themselves. They don't have a Sep IRA, and they didn't realize they could be saving more than just the traditional 6500 or $7500, depending on whether they're over 50 or not. They just didn't realize that they could save up to 25% of their income or $63,000, whichever is lower. There's a real opportunity for you to really build significant wealth quickly with a Sep IRA. And if you're if you're a business owner, you've got questions about how to get more tax efficient, fee efficient and market efficient with your money and how to save your money into tax efficient and tax deferred accounts, I would encourage you to reach out to us at 770685. 1777. Again that's (770) 685-1777. And you can always visit us at active wealth.com and click that schedule a consultation button. When we come back from the break, we're going to play a special right or wrong. I think everybody really loves our right or wrong segments and I think you're going to like it. Also, we just want to thank you for listening to us. Thanks for making us the number one listen to radio show on Am. 920 The answer. We appreciate you as an activator. Also, we appreciate you as a veteran or an active duty member of our US military and first responders. Thanks for keeping us safe. And again, happy Memorial Day weekend, everybody. And we were remembering those who've given the ultimate sacrifice in keeping us free and protecting our country. We'll be right back from the break with our new right or wrong segment on the Active Wealth Show right here on AM 920 the Answer.
Charlie Kirk :
Charlie Kirk here. If you're concerned about your investments, rising taxes from the Biden administration, then I encourage you to listen to the Active Wealth Show hosted by my good friend Ford Stokes right here on AM 920 The Answer. Listen to the Active Wealth Show Saturdays at noon and Sundays at 11 a.m. The Active Wealth Show right here on AM 920 The Answer
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Producer:
Listen to the number one show on the weekends on AM 920 The Answer to Protect and Grow Your hard Earned money. The Active Wealth Show with Ford Stokes, your chief financial advisor Saturdays at 12 noon and Sundays at 11 a.m..
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Any bonuses mentioned may be subject to additional restrictions and regulations based on the offering annuity company. You may not receive the bonus if the contract is fully surrendered or if traditional annuitization payments are taken and if the policy is partially surrendered, it could result in a partial loss of bonuses. Because these are bonus annuities, they may include higher surrender charges, longer surrender charge periods, lower caps, higher spreads, and other restrictions that are not included in similar annuities that don't offer a bonus feature.
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Thanks so much for listening to the Active Wealth Show. Make sure to rate us everywhere you listen to podcasts, including Spotify.
Ford Stokes:
And welcome back to the Active Wealth Show Activators. I'm Ford Stokes, your chief financial advisor, and I've got Sam Davis, our executive producer on the show. And Sam, I'm going to let you lead us off with the questions. For right or wrong.
Sam Davis:
I'm going to read a statement and then Ford, you're going to help the activators understand if that statement is right or wrong. Here's the first one. The Social Security Administration has come out and stated that if no changes are made, the Social Security trust funds will be depleted by 2034.
Ford Stokes:
Well, unFordunately, Sam, that is right. And it is a shocking thing to hear. Many of you might be driving off the side of the road when you hear that. It is, in fact, true that the Social Security Administration has come out and stated that if no changes are made, Social Security trust funds will be depleted by 2034. That's 11 years from now. What people have speculated for decades appears to be coming in about ten years, 10 to 11 years. Social Security has a funding problem. It is in need of serious changes in order to continue paying benefits for both current and future retirees. The concern I have as an advisor is for most Americans, Social Security is either the number one or number two source of income for retirees in the United States. It started out as a retirement for low wage earners. And like all public programs in entitlement programs, guess what? They never trenched back. People enjoy the benefit and they never give it back. And this is why we're stressing the importance of having a strong income plan. Retirement is more about income than it is about building one big nest egg.
Ford Stokes:
We want to make sure you're not just counting on Social Security as a main component of your retirement. I also don't want to over scare you and over concern you. It's likely if the Social Security funds are depleted, they would they would probably take benefits down to right around 30% less. So you'd you'd lose 30% of the benefit you're getting now or what you're due to get. So it's not like you're going to lose all of it and you're not going to have Social Security at all and Social Security won't be around for you, but you will have a lower income from Social Security and they will continue to tax that income still. So you need to have a plan. You need to have a retirement income plan. And if you're looking for a retirement income plan, I'd encourage you to reach out to us at active wealth.com or Active Wealth Show.com and click the schedule a consultation button in the upper right corner. And we're happy to help you. Sam what's your next right or wrong?
Sam Davis:
Here's the next one. If your employer doesn't offer a pension or other defined benefit plan, there is no other way to establish a personal lifelong income stream.
Ford Stokes:
Well, actually, in fact, that is wrong. And that's good news that it's wrong. Annuities allow anyone to protect and grow their wealth by establishing an income stream they can never outlive. Did you know the Romans offered annuities way back in the day? Called annuity Fixed indexed annuities are often used to create personal pension plans for pre-retirees and retirees. The investments performance is tied to a stock market index, allowing you to enjoy market like gains without worrying about stock market risk. Your principal is 100% protected, meaning the worst you can do in a single year is 0% growth. Example Owners of annuities lost $0 in 2008 when the S&P 500 lost 37.1% of its value from March oh eight to March zero nine, the S&P 500 lost 50.1% of its value, and owners of annuities lost $0 in that time period, also 2022. There's there was a significant downturn in the market. Again, annuity owners lost $0 during that time period. If that's something you're interested in and you are concerned about what's going on in the market, you're concerned about who's in the White House, you're concerned about what's going on in all the frustrations and all the frustrating things that are happening with debt ceilings. We'll get into that after this as well. And you just feel like we're we're leaderless and we don't have the right leader in the White House and therefore, we don't have the right policies.
Ford Stokes:
And you're concerned about the future, specifically your retirement future. I would encourage you to reach out to us at active wealth.com or call us at (770) 685-1777. We'll give you a free financial consultation at no cost to you. You'll get a free portfolio analysis and a free financial plan with your current portfolio that has nothing to do with us to your 95th birthday. And we'll also give you one with our recommended portfolios to your 95th birthday. And finally, we'll give you a Roth ladder conversion with that same recommended plan with our portfolios all the way to your 95th birthday, all at no cost to you. And guess what? What's in that plan is a retirement income plan. And if you don't have a retirement income plan, I strongly urge you to consider it. Go ahead and reach out to us at active wealth.com. Also, one other point I want to make here, Sam. Some annuities also offer bonuses. So if you're considering taking a lump sum versus a pension from work. Schedule an appointment with us so we can review your options and help you maximize what you worked so hard for.
Sam Davis:
All right. Here's the next item. Once you turn 65 years old, Medicare will cover all of your health care costs, including any long term care needs.
Ford Stokes:
Well, there's a couple ways that's wrong and it is wrong. Number one is Medicare covers about 80% of the health care costs. And you should get a Medicare Advantage plan or a medigap supplement insurance plan to supplement the other 20% of your health care costs. You can cap all of your costs for your. Your deductibles and your co-pays. Also, many people believe that the government will take care of them and their medical expenses once they're on Medicare. But unFordunately, this is not the case. You need to be prepared for any and all of these costs during retirement and want to be very clear. Medicare does not cover long term care. If you're looking for the government to take care of you in the last few years of your life with long term care, you're required to only have $2,000 in assets, and you've got to keep your income below $2,000 a month. And the rest of the money goes to the state government that's taking care of you in their facility. Here are all the costs you need to be prepared to cover during retirement. Monthly Medicare premiums, annual deductibles, co-payments, prescription drugs, services not covered by Medicare, such as vision and dental care, and long term care. That's a lot. That's a lot of things you've got to pay for. By the way, if you think long term care insurance is expensive. Wait till you find out how much it costs to actually enjoy long term care.
Sam Davis:
Here's the next one. You can use an annuity to fund your Medicare expenses during retirement. Is that right or wrong?
Ford Stokes:
Sam? That's right. We believe this is a smart idea. This is a great step to ensure that you and your spouse will be able to fund expensive health care costs during your retirement plan ahead and avoid the dread. All right. When we come back from the break, we're going to give you a market update talking about what is the debt ceiling. And we're also going to share with you how much the US has built up in household debt across the country. I think you're going to be shocked by this number. You're listening to Active Wealth Show right here on AM 920 the Answer, come right back to get some important information for your retirement.
Producer:
Even with today's high interest rates, refinancing your home loan could save you money. Depending on your situation. I'm Matt McClure with the retirement radio network Powered by Amara Life. Inflation has been hitting us all in the wallet for more than a year now. To combat rising prices, the Federal Reserve has hiked interest rates several times. The idea is to decrease demand so that it comes back in line with supply levels. With interest rates on everything from homes and cars to credit cards higher than they have been in a long time, you might think it would be impossible to save money each month by refinancing your mortgage. Think again.
Speaker8:
We are in a very different situation than we were last year at this time.
Producer:
Mike Fratantoni is chief economist at the Mortgage Bankers Association. He recently told CBS News the vast majority of homeowners have rates well below those currently available in the market. But depending on your situation, you may be able to take advantage of a dip in rates from their recent highs.
Speaker8:
So 6.3 is not going to be attractive for a lot of folks that refinance over the last couple of years. But for someone that might have bought a home earlier this year, it could be a good opportunity.
Producer:
Saving on your monthly mortgage can be a huge boon for retirees since a single payment can quickly eat up an entire Social Security check. If you're still paying off your home, consider refinancing to a lower rate to save money on those monthly payments. So could now be the right time for you to refinance your mortgage. It's a key question to consider, and it's one of the 23 retirement cost cutters for 2023. With the retirement radio network Powered by Mirror Life, I'm Matt McClure.
Producer:
To get your free copy of 23 retirement cost cutters for 2023. Give for a call today at (770) 685-1777 or go online to active wealth.com.
Ford Stokes:
Chapter 11 Single premium Immediate annuity when you need money now big idea. Older retirees often find this type of annuity attractive due to how the distributions are calculated. Older clients collect over a shorter amount of time and therefore will receive higher payouts. How does it work? Typically, you would buy immediate annuities by paying the insurance company a lump sum of money. The insurance company, in turn, promises to pay the annuitant a regular income, according to contract terms. Those payment amounts are calculated by the insurer and they typically begin within a month of purchase. You can also decide how often you want to be paid. Known as the mode, a monthly mode is the most common, but you can also choose quarterly or annually. Other things to know. Older clients often collect fewer payments from their annuities due to a shorter time horizon. With an immediate annuity, this works in their favor. Client life expectancy, among other factors, helps determine the income payments. Older clients typically collect over a shorter number of years. This means that their monthly payments will be higher than younger investors of this product. For example, if you purchase an immediate annuity at age 65 and someone else purchases the same annuity at age 78, the 78 year old will receive higher monthly payments because their investment is spread out over fewer months than the 65 year old investor.
Ford Stokes:
If you think you haven't saved enough money for your retirement and you are worried about outliving your wealth, an immediate annuity may be a good choice for you. An immediate annuity would also be a good choice for someone who wants their spouse to have a steady income for the remainder of their life. Some immediate annuities come standard with this feature, but it may also require the purchase of a writer. You can always explore your options before you choose the product that is right for you. Living below your means during retirement is more than important. It is essential. That means your monthly expenses during retirement must remain lower than the after tax distributions you take from your investments, plus any pensions or Social Security income. Please remember to do everything you can to not distribute more than 4% of your total asset portfolio in a given year so your money can continue to grow. We do not want you to over cannibalize your assets. We want your money to last.
Producer:
Thanks for listening to the Active Wealth Show. If you like what you're hearing, subscribe to our YouTube channel to watch videos from this program and other recent episodes.
Ford Stokes:
Welcome back to the Active Wealth Show Activators on this special Active Wealth Show during Memorial Day weekend. Hope everybody is having a happy and safe Memorial Day weekend. And before we get into the market update and what's going on with US household debt, I want to share the inflation demonstration specifically around the Social Security cost of living adjustment forecast for 2024.
Producer:
Want to know where your hard earned money is going. It's time for an inflation demonstration.
Ford Stokes:
Social Security recipients shouldn't expect 2024 cost of living adjustment to be as significant as 2023. Despite warnings that beneficiaries are losing their purchasing power, the 2024 Cola could be around 3.1%, according to Mary Johnson. The Social Security analyst for the Senior Citizens League. In a news release issued last week. Johnson went on to also say that the Consumer Pricing Index does not accurately reflect the rising cost of items that older Americans more frequently spend their money on, including prescription drugs, food, housing and dental services, which are generally not covered by Medicare. The 2023 increase at 8.7% was the largest cost of living adjustment increase in over four decades from the Social Security Administration, partially thanks to supply chain disruptions, which fueled soaring inflation amid the pandemic. According to the Senior Citizens League, for every $100 a retired household. Spent on groceries in 2000. That household can only buy about $64 worth today. That is shocking. The official Cola won't be announced until October before going into effect in January.
Sam Davis:
That is a shocking stat. So once again, for every $100 in groceries a retired household could purchase in 2000, you can only get $64 worth of groceries today. Another way of thinking that of that is if you could get six bags of groceries for $100 in 2000, today you're only getting four.
Ford Stokes:
Yeah, that's that's less food to eat. That's that's eating chicken instead of steak. That's eating hot dogs instead of chicken. That's eating more processed meats, which isn't as healthy, especially for retirees, for also their brain function as well. So. Try to avoid some of the processed meats as you get older in life. That's something also to consider. I would just say that guys and gals. If you think Social Security is going to save you, I promise you it's not. And and you've got to do a really good job at budgeting. And if you're living on fixed income, you've got to make sure that you're living below your means during fixed income for sure. And also you're saving for retirement is a pre-retiree and you're still working. It's a good idea to protect and grow your wealth and have your own retirement income plan and even consider building your own personal pension. If you've got ideas around that or you want to get more ideas, again, all you've got to do is visit us at active wealth.com. That's active wealth.com and we're happy to help you. We look forward to helping you build your own successful retirement plan.
Producer:
Your active wealth market Update.
Sam Davis:
Taking a look at the debt ceiling Ford and why it matters. First off, what is the debt ceiling? It's a statutory limit on the amount of debt that the US Department of Treasury can issue to cover the existing obligations of the federal government. It's essentially a cap on the total amount of money that the government can borrow to fund its operations. And the US hit that debt ceiling limit in January. The nation may run out of money to pay all of its bills as soon as June 1st. And time is ticking on that. June 1st is the called X date. If you hear them talking about that in the news or if you read that in the Wall Street Journal or something like that, the government wouldn't be able to pay everyone on time and it would most likely prioritize payments to investors holding US Treasury bonds to avoid a technical default and more widespread financial volatility payments such as Social Security, Medicare, tax refunds, military salaries and others would likely be delayed. Democrats and Republicans have not yet reached an agreement to raise or suspend the debt ceiling and avoid that outcome. Last we've heard, they are making good progress, but no final resolution has been come up with.
Ford Stokes:
Yeah, I'm glad that Kevin McCarthy and the Republicans in the House are have dug their heels in to some extent. I don't know how much of it is window dressing, how much of it is actually real. We've got to get more fiscally responsible. We're now our debt interest is is crazy. And we're we're it's you know, we've got to pay out more than we're bringing in in a single year, which is just nuts to me. I've got a solution. And that solution is borrowed from Warren Buffett. So I just want to read what Warren Buffett's solution is. Warren Buffett said on CNBC. He said, I could end the deficit in five minutes. You just pass a law that says that any time there's a deficit of more than 3% of GDP, all sitting members of Congress are ineligible for re-election. The 26th Amendment, which granted the right to vote for 18 year olds, took only three months and eight days to be ratified. Why? Simple. The people demanded it. That was in 1971, before computers, email and cell phones and social media. Of the 27 amendments to the Constitution, seven took one year or less to become law of the land. All because of public pressure. We should all apply public pressure to our elected officials. To start balancing the budget and therefore protect. You know, our futures for our kids and our grandkids, not necessarily just for us. We need to just protect it for our kids and grandkids. And same. You've got another update about what's going on with household debt in the United States, which isn't great news either.
Sam Davis:
Yeah. So from debt in Washington to debt inside our own homes, household debt has surpassed $17 trillion for the first time. Americans debt levels continue to climb to new heights at a time when economic conditions are becoming increasingly less stable. Household debt balances set a fresh record high of $17 trillion during the first quarter, growing by 148 billion, or about 1% from the fourth quarter last year. And that was reported by the Federal Reserve Bank of New York. That debt load has spiked by almost $3 trillion since the end of 2019. And during the first quarter, the increases in debt were seen across practically all categories with larger and record balances for mortgages, home equity, lines of credit, auto loans, student loans, retail cards and other consumer loans. And Ford. I have to think that a contributing factor in that, especially when it comes to those balances for mortgages and automobiles, is the high interest rates lately that definitely works against us in paying down our debt.
Ford Stokes:
Yeah, this is interesting because we've gone through a whole spectrum during the from the pandemic to now, but also on this radio show, Sam and I reported that. Credit card debt was the lowest it had been ever. After the stimulus checks hit because a lot of people were paying off debt with the stimulus checks. And now we're back up and household debt is surpassing 817 trillion. And, you know, I'm getting credit card application notices and offers and all this kind of stuff in my mailbox on a daily basis. I mean, they're choking my mailbox and I just throw them in the trash. I don't even bother opening them up. We really need to start following a little bit of Dave Ramsey principles here. And let's don't build up the debt. It's let's try to really avoid debt. If we can pay credit cards off. And by the way, I want to be clear about something. You're not going to be able to get rich on frequent flier miles and hotel points and rental car points. You might be able to save some money on on a trip or two, but you're not necessarily going to be able to take that to the bank and deposit it into your checking account. It is more important to you that you do not live beyond your means.
Ford Stokes:
That would be very helpful than it is for you to just build up frequent flyer miles. So just be careful about how you use credit cards, please, because it can get away from you in a hurry. And if you're living on fixed income, you're going to find yourself that that is suddenly become one of the things you just have to pay on every single month. And you're never going to get out of credit card debt if you're incurring it during retirement. And you don't want to have to take out more than a 4% withdrawal of your retirement nest egg, your liquid assets, the city and your IRA or your investment accounts or your savings accounts. Et cetera. And I wouldn't count on just renters paying you rental income to make sure that that's funding your retirement as well, because there's plenty of renters who don't pay their rent. So be careful there, too. You just got to get to home base. Also, you're going to benefit from if you if you buy a fixed indexed annuity or you're going to benefit from building a retirement income plan. And you're going to live longer because you're going to have more peace of mind that your income's already taken care of during retirement.
Sam Davis:
Absolutely. And here's some quick tips for avoiding debt and financial stress. Number one, have an emergency fund that covers 3 to 6 months of expenses. You can have that split up between a checking account as long as you're not over $250,000 in there, you should be good. But have that split up between a checking account and even some cash on hand. Also, establish a household budget and stick to it. The stick to it is sometimes the tougher part, but definitely stick to it. And I would add in there for that, if you've got a purchase coming up, whether it be a new car or a vacation or whatever it might be, set a budget for that item before you start shopping around and actually making that purchase. And I know you'll appreciate that.
Ford Stokes:
It's fun to shop around if you're shopping for a mattress this weekend with all the mattress sales. Right. It's a good idea to shop around and see what you can get.
Sam Davis:
Absolutely. Last couple tips, pay off your high interest debts first, especially that credit card debt. Most of those are well beyond 20% interest rates per year. Pay those off as soon as possible and make regular contributions for both your short term and your long term savings goals. And we can always help with that by visiting active wealth.com.
Ford Stokes:
Work hard to keep debt down. Also try to get your house paid off if you can do one extra house payment a year and that will take your 30 year mortgage down to right around approximately 17 years. And that's a big difference if you can do that. And we come back from the break, we're going to have our final countdown at the end of Segment four as well. We've got more great information on how to invest and protect your wealth. Thanks so much for listening to us on this special edition of the Active Wealth Show during this 2023 Memorial Day weekend. And thanks again for everybody who keeps us free and and fights for our freedom. We appreciate you and we recognize you on this Memorial Day weekend. We'll be right back.
Uptown world. I bet she never had a back.
Producer:
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Ford Stokes:
And welcome to the Active Wealth Show Activators. I'm Ford Stokes, your chief financial advisor. And I'm here with Sam Davis, our executive producer, on this special edition of the Active Wealth Show on Memorial Day weekend. We're talking about how to protect and grow your hard earned and hard saved assets for retirement, how to build a successful and stress free retirement, and wanted to help some of the pre-retirees out there. And this might help some of the retirees as well. But we've got some steps here on if you're planning to retire in a few years, do these things first. Number one is you ought to meet with a financial professional, a financial adviser or a financial professional. You can schedule a meeting with us today. This is what we do for a living. All you got to do is visit active wealth.com and click that schedule a consultation button in the upper right corner. It's also available on active wealth. Show.com, if you want to look at any of our episodes and because we record them all via video as well. We want to help you assess your current financial situation. We'll consider your income, your expenses, assets and liabilities, also your Social Security income. And we'll evaluate all of that for your retirement readiness. And we'll also set realistic retirement goals. We'll help you establish and reach achievable financial goals based on your assets, your desired lifestyle and timeline for retirement. Step two is make adjustments to your portfolio as necessary. After some stress tests and analysis on your current investments and retirement plan. We will present different options to consider based on your goals and risk tolerance.
Ford Stokes:
Diversify your investments as well. We will help you find a comFordable balance of both smart risk and smart, safe investments. Smart risk being like tactical asset allocation, utilizing things like structured notes to generate growth in interest as well. And then smart safe investments would be things like fixed indexed annuities and life insurance and smart tax investing would be implementing a Roth ladder conversion plan for your IRA to a Roth IRA. You want to have a good offense and a great defense. Consider implementing a Roth ladder conversion plan. Like we said, if your retirement savings is mostly sitting in tax deferred accounts like an IRA or a Sep IRA or a 403 B or a 457 or a simple IRA. This will help you avoid future tax increases and generate tax free income. Also with a Roth IRA. There are never any required minimum distributions. If you want to get rid of RMDs before you turn the age of 73, which is the new RMD age. I would encourage you to reach out to us and we can help you. All you got to do is call us at (770) 685-1777 and we can help you get started on a plan today. And if you're interested in maximizing your retirement savings and learning what a Roth ladder conversion could do for you, just get in touch with us. You can you can just reach us at active wealth.com. Click that schedule a consultation button in the upper right corner. We're happy to help you schedule today so we can get to work on building a winning retirement plan for you and your family.
Ford Stokes:
All meetings are complimentary. And you only work with us if it's best for you. We're going to tell you if it's best if you stay in your current plan or if you work with us. Then step three of what you should do if you're planning to retire in a few years is develop an income plan. Plan for Social Security and check for income gaps. One of the biggest decisions you're going to make. Throughout all of your retirement is going to be when you're going to take Social Security will help you make that decision. We'll run a Social Security maximization report for you at no cost to you. It's about a $250 value. And we just run it through our software and we're happy to do that for you. We'll also consider other retirement income sources such as pensions, annuities, rental income and other part time work. We'll also help you establish your own personal pension to provide you with the income you need for life. And those are three big steps that you can take when you're planning to retire in a few years. So let me recap those. Number one is meet with a financial professional. Number two is make adjustments to your portfolio as necessary. And number three is develop an income plan for Social Security and check for income gaps. We want to make sure you've got a. A retirement income surplus, not a negative retirement income gap in your plan. It's the final.
Producer:
Countdown. So let's recap what you may have missed. It's the final countdown.
Ford Stokes:
So on today's final countdown, we talked about the debt ceiling. We talked about. How? Us households have gone up over $17 trillion. In household debt, which is extremely concerning. We gave you some some steps and some strategies on in this segment on what to do when you're planning to retire in a few years. And we gave you those big three steps, which included one meet with a financial professional to make adjustments to your portfolio when necessary. And three, develop an income plan. And we also had two really impactful quotes. And Sam, if you could just review that with the folks during this final countdown.
Sam Davis:
The first quote came to us from Bobby Knight. And Bobby Knight once said, The will to succeed is important. But what's more important is the will to prepare. And the second quote came to us from Joe Moore. And Joe Moore said, A simple fact that is hard to learn is the time to save money is when you have some.
Ford Stokes:
Amen. It's just time to to really have a good idea and and don't just sit there and talk about, you know, saving for retirement when it's too late. I want to make sure that you've got a really good, good idea and a good plan. And, you know, consider Roth ladder conversion. We can help you with that. You're going to move over a little bit of money each year from your IRA to your Roth IRA. We like to get out of our Roth ladder conversion plans and 5 to 7 years. So if you've got a million bucks, we might be. Transitioning. $200,000 a year and trying to stay below that. 24% threshold. When you're doing any conversions. We like to try to implement conversions right around 20 to 22%, but the top end of the 24% bracket is $364,200. So if you're married filing jointly, you can move $200,000 plus your income that you've got for the year and you're likely going to stay below that $364,200 if you are retired, if you're working still. Obviously, it's probably problematic, but you could be moving a little bit at a time during your working years, especially when you're in that retirement red zone, which is five years before retirement and five years after retirement. We're happy to help you do that. We hope you found this special edition of the Active Wealth Show.
Ford Stokes:
Informative and helpful. We want to help you protect and grow your wealth with smart risk, smart, safe and smart tax investment solutions. And all you've got to do is reach out to us at active wealth.com. That's active wealth.com. You can click that schedule a consultation button in the upper right corner and we're happy to get started for you. You'll get booked directly into my calendar. You won't get passed off to any other advisors. Also, if you want to just go straight to a way to book directly to my calendar, you can go to calendly.com/forward Stokes that's calendly.com/forward Stokes And it goes straight into my calendar and it's schedule. You literally schedule a zoom call directly into my calendar, which is pretty good. You can also feel free to come into our office at the King Queen building on the 29th floor. We're also super excited to announce that we are going. We're buying a building and we're going to be on McFarland on Exit 12 in Alpharetta and Cumming and South Cumming there near Halcyon. We're super excited about that. We're going to try to move in there at the end of next month and we just really appreciate all of you. Activators We really, really enjoy working with you all. And do me a favor, if you listen to the show for a really long time, just give us a call at (770) 685-1777.
Ford Stokes:
We'd love to hear from you. Again, that number is (770) 685-1777. We'd love to help you. It's also a great way for you to delete advisory and portfolio fees for 20 to 40% of your overall portfolio by investing in a fixed indexed annuity because there are no advisory and portfolio fees with a fixed indexed annuity because we can help you there. We also can help people with managed portfolios that are actively managed and actively traded on a monthly basis because we don't believe in just writing down the to the absolute valleys of the market and we want to do everything we can to protect your hard earned and hard saved assets. And we wish you all the best. Hope Everybody has a very happy and safe Memorial Day weekend. Please stay safe out there, especially on the lakes out there. It can be dangerous. Please stay safe out there for us. And just thank you again to everyone who is keeping us safe in the US military, whether you're a veteran or an active duty, we appreciate you. And we just really, really want to recognize everyone who gave the ultimate sacrifice. Thank you for everything you do for us. Have a great and happy and safe Memorial Day weekend, everybody. We'll see you next week.
Producer:
Thanks for listening to the Active Wealth Show. You deserve to work with a private wealth management firm that will strategically work to protect your hard earned assets. To schedule your free consultation, call your chief financial advisor, Ford Stokes at (770) 685-1777 or visit active wealth.com Investment Advisory services offered through Brookstone Capital Management, LLC BCM a registered investment Advisor. Bcm and Active Wealth Management are independent of each other. Insurance products and services are not offered through BCM but are offered and sold through individually licensed and appointed agents. Investments involve risk and unless otherwise stated, are not guaranteed. Past performance cannot be used as an indicator to determine future results.
Producer:
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.
Charlie Kirk :
It's more important than ever for conservatives to stick together. That's why I recommend you to reach out to a fellow conservative Ford Stokes of Active Wealth Management. Active Wealth is offering listeners a free financial consultation worth over $1,500. This free report will show you the fees you're paying, the risks you're taking with your current portfolio and can help you maximize Social Security benefits. Visit active wealth.com today.
Producer:
Investment Advisory Services offered through Brookstone Capital Management, LLC BCM a registered investment advisor, not an actual client of Active Wealth Management.
Producer:
We have Ford Stokes, author of two important personal finance books. Annuity 360 and taxes are on sale here on Am 940. The answer, as the host of the Active Wealth Show Saturdays at 12 noon and Sundays at 11 a.m..
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