1.20.23: Audio automatically transcribed by Sonix

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

Producer:
Any examples used are for illustrative purposes only and do not take into account your particular investment objectives, financial situation or needs, and may not be suitable for all investors. It is not intended to predict the performance of any specific investment and is not a solicitation or recommendation of any investment strategy. Welcome to your retirement. I'm broken with your host, Merrit Strunk. Merrit is a licensed fiduciary and financial advisor who always places your needs first. Merrit works hard each day to educate Americans like you on how to reach the financial freedom they've worked so hard for. And he can help you, too. So now let's start the show. Here's Merrit Strunk.

Merrit Strunk:
Hi, this is Merrit Strunk, host of The Retirement Unbroken Show. And welcome, great unbroken nation out there. Today's show, we're going to be talking about how you have a smart retirement plan. And we're going to be talking about smart vision, smart inspection and smart planning. Right. And then we're going to talk a little bit about how inflation is going. I'd like to welcome Matt McClure, our senior producer. Matt, how are you doing?

Producer:
I am doing great. Merrit, I hope you are as well. Despite all the craziness in the financial world these days, I think I'm hanging in there.

Merrit Strunk:
There is some craziness. Good to hear it. Thanks for hanging in my brother. I appreciate that. Okay, so the markets are down today, but that's after the markets have been up for about a week now. We've seen some success of higher closes as which we want to do. And what we're thinking here and this is speculation on our part. What we're thinking here is that the market has a 25 basis points rate hike priced into it. The market always does that market is forward looking right. And so we think there's going to be a 25 basis points. We might be surprised by the Fed doing something higher, but we're hoping 25 basis points is where they're going to go. And then they do what's called a pause, a pause to stop and look around at the party where they've knocked over the furniture and wreck the house. Right. So they're going to take a look around and go, all right, are we doing our job as inflation coming down and inflation is coming down? So that's a very good thing. Many people think that because of our strong employment situation that we just can't see a recession. So you've got to narratives going on. You've got one soft landing to hard landing. And, you know, interesting on the hard landing, I was on a briefing from Jeremy SIEGEL the other day, and he is a renowned economist. And it's interesting, he just backed off his long and deep and terrible recession predictions. He was like, yeah, I got to back away from that. I don't think it's going to happen. The main thing being, you know, we've got a great employment market.

Merrit Strunk:
So no matter what the Fed is throwing out America, trying to wreck the stock market and everything else to try to bring it down because we are seeing a fairly strong employment situation. Thoughts are okay, so we can't have a recession while this market is so strong. That would be very atypical. Not that it can happen, just atypical. And we are seeing some layoffs. Microsoft is the latest one to announce that they're going to lay off 10,000 people, but that was specifically from their Xbox gaming division. So, you know, they've joined the ranks of many other technology companies that have announced layoffs. So that is the market briefings is saying that it has been up and that was good There starting to be some good feelings about that. Very nice signs. But the last two days we've seen a negative market and it's trying to figure out what what it's going to do. My my hunch is when it went up, we saw some people sell out. We saw some people sell off, some stocks took some profit. And then this is all cycles. We go in and out of these things. So it's going to be bouncing around for a while here. I'm going to talk about my thoughts on the market and how to get some guidance here as we talk about this smart vision, smart inspection and smart planning aspects. And our goal, as always, is to equip and educate you so that you can unlock the potential future for your financial well being. So as we get started here, Matt, would you please share with us the financial wisdom quote of the week?

Producer:
And now for some financial wisdom, it's time for the Quote of the Week. I would be glad to do just that for you. Merit. And our quote of the week this time around comes from someone you may have heard of before. Samuel Clemens name not ringing a bell. Well, he's better known as Mark Twain. Yeah, that's that's how you know him. The famous author, of course, Tom Sawyer and Huck Finn, fame and so much more. Really? Well, Mark Twain said this one time. He said, quote, The secret of getting ahead is getting started. The secret to getting started is breaking your complex, overwhelming tasks into small, manageable tasks. And then starting on the first one, I like that, you know, just kind of getting back to the basics, really.

Merrit Strunk:
Yeah, it is the basics, which is what do you want to accomplish? You know, at the beginning of the year is a great time to do it. What are goals that you have or you or your family or whatever, or fitness goals or whatever you would like to do? You know, in our case, it would be financial planning. You'd say, All right, what do I want to achieve here? Focus my attention at the beginning of the year, take some time to step out of your busy, busy life and go, All right, now what are my first steps to achieving that? And then by when? Right. That's the big one. The smart goal. Right? By when is it? Is it specific? Is it measurable as an actionable? Is it timely, Those kind of thing smart acronym. Okay. So if you folks if you never stop by our website, you might want to give it a try. It's retirement unbroken very easy to remember RetirementUnbroken.com there you can listen to other podcast episodes, radio shows and so on. You can also call us at 8585219700. You can email us through the website and leave any questions you have that you like us to address. Some topics we would want to do that. So please reach out. We love to hear from our listeners and you can, by virtue of doing that, you will join the unbroken nation. Very honorable distinction to belong to the unbroken nation. Because likely by getting educated, you're going to enter into your later years better off than those who never listened to these kind of things, right? Who never take the time to set goals and take action for better financial future.

Merrit Strunk:
Listen, So, you know, do you when you when you're feeling ill or you have maybe, God forbid, a medical condition? Yes. The Internet's full of WebMD. All of a sudden you start to be a hypochondriac and you're like, That's me. That's me. I got schistosomiasis. That's what it is. I had no idea. I've got, you know, discoloration of the mucus. It's schistosomiasis, right? No, it's not. That's not what it is. But, you know, so you seek out good counsel from doctors. If it's a legal situation, who do you go to? You go to a lawyer. If you want to have home improvements or something like that, you go to a qualified and licensed contractor. Right? So just as you trust experts in these situations, we believe that nothing replaces the advice that you would get from a certified financial fiduciary, financial advisor and professional. So I would encourage you and this is really the topic, a lot of the topic that we're going to be talking about today is start The New Year is a great time to reevaluate your retirement plans. And you may be saying retirement plans, say Merrit, I'm 35. What are you talking about? Well, let me just tell you, if you do not plan, there may be a chance you don't have a retirement. So better to put in place now.

Merrit Strunk:
The things and the questions and the answers and the and the strategies you have to put in place so that you will achieve what you're trying to do. It's much like the Mark Twain quote, which is break it apart. First things first, get it in smart inspection. Right. And your goal of having done your planning and having a smart retirement plan. So, you know, retirement is one of those important times in our lives. And it you know the the definition air quotes retirement has really changed over time. Depending on who you are, you may have the American golden year sort of thing where you work and work or work or work work until you cannot work anymore. And then you go, all right, now I'm going to enjoy the fruits of my labors, right? And that the golden sunset thing, you might just be fishing all the time or place by the beach or whatever, hopefully. Right. However, there's a different skill set when you're working work and work and work and work. And we're we're like a shopping basket, right? We're throwing money in accumulating for a1k403b4 57 or whatever it might be. And we're trying to accumulate and grow, grow, grow, grow, grow. And we have years to take risk and do that. But just like a mountain climber, if you've ever talked to a mountain climber who's who's actually accomplished climbing Mount Everest and I have talked to them before, I had the benefit of actually meeting and chatting with somebody about that.

Merrit Strunk:
And they'll tell you that going up that mountain is one skill base. But once you're up there, guess what comes next? You've got to come down the other side of the mountain, don't you? And that is a completely different skill base, much like retirement. So we've gone up the mountain we've accumulated and now it's the distribution or accumulation phase of our life. And there are different mentality, different paradigm, different thoughts and tools you can use to do that effectively. But if you never have the conversation, you don't get into those things. And the earlier you do it, the better. Nothing beats systematic wealth growth. I'm telling you, it beats the heck out of not having any wealth growth idea or an income plan. So. So retirement can be a great time of joy and relaxation, visiting with the grandkids, gifting, helping, creating experiences. And it should be. The other definition of retirement is that you could choose to retire, but you don't have to. You can have a work optional lifestyle. Why can you have such flexibility and choices? Well, because you have income, you have assets, and you know how things are going to be funded. I would encourage you to jump up board the retirement, a broken nation, and know the answer to those things. Unfortunately, research and studies that have been done time and time and time again have shown that Americans are not prepared for retirement as much as they would like to be.

Merrit Strunk:
Factors like what we're going through now with extreme inflation, using more of your retirement dollars to just buy the same things you normally do in your lifetime, your lifestyle, things like savings, high levels of debt, uncertainty about Social Security benefits, health situations. You know, maybe you need to spend more money and health situations or plain old taxes, Right? So additionally, also, we learned some lessons here. We spend the will you spend a wheel. It's like the wheel of fortune to de de de de de de de de de de de de de de oh. What do we got there? We have a global pandemic. Hey, fantastic. We're not guaranteed that we the will may spin again. And we've got what? The next pandemic, the global geopolitical situation gets worse. Whatever. We've got to be prepared for those things. It's our responsibility, folks. If you're driving in your car, listening home and listen on the podcast, whose responsibility is it that you're going to end up financially? Okay. All right. In our book that we wrote, the retirement on your Retirement Unbroken, one of the statements in there, it's a little, little work section. It's just like just fill in the blank. And Matt, you remember the time I asked you this question? It said something like, Instead of planning my financial future, I was busy doing Fill in the Blank. Hmm. Mm hmm. But, you know, what's that going to be? Suggestions, Matt? What's. What's what's that going to be in there?

Producer:
I was busy ordering takeout. Perfect. Perfect. Yeah.

Merrit Strunk:
Or I was busy spending time watching 5 hours of TV a day, or I was busy golfing or whatever. But. But. But at that point in your life, it's going to be not a good enough excuse. Wow. You know, there's no finger to point any place else. You can blame Washington if you want, but that's not going to do any good. You know, there was a Fidelity research study on retirement planning done in 2022 and results were 71%. It's two thirds of Americans, right? 71%. Said they're very concerned about the impact of inflation on retirement preparedness. Absolutely. You know, we do our financial plans and we stress test them. We take a look at inflation and we adjust the amount of inflation we have over time. On the retirement plan. There's nothing that can wreck your retirement as much as inflation. And probably the second one coming up there would be taking too much money out, like withdrawing withdrawal rate, being too high. And the other one is negative sequence of returns. All of those kind of line up here in this situation we currently are in. Hopefully we'll be out of it fairly soon. In that same study by Fidelity Investments, the State of retirement planning study, it says 31% don't know how to make sure their retirement savings keeps up. So that's a rough one, right? So approximately half of Americans are at risk of not being able to maintain their pre-retirement living standard after they stop working. No more W-2 or 1099 coming in. And that statement right there, that comes from the Center for Research at Boston College.

Merrit Strunk:
And we've we've included data from the Boston College Center for Retirement Research before they specifically focus on these things. Any of that data that is that's concerning. Right. Another one for Charles Schwab is a 2020 survey. This one this time said of currently employed employees, you know, working for somebody's 401. K plan participants. So they're saving in a41k found that saving for retirement is a leading source of significant financial stress for all generations. That means they're working, they're saving. They've seen their kids go through some some stress. I don't know how old they might be, but they may have also seen their older parents. You may have older parents. You may be very concerned over this COVID period. Where is their is their savings, their financial situation going to be enough to survive this long term? Right. So in that study, 41% had to make changes to their 401. K because of the pandemic. I'll bet you I know what that is. You know, they're trying to say I've lost too much in my 401. K and now I need to take something out and put it on the sidelines. Dry powder or just in a stable fund where it's not going to lose so much. And I would say that's okay. Depending on what your age is, if you're a younger person, you could take it on the chin. Recession, Poppy, in the nose. That's okay. I can just shrug it off. I've got years and years and years to go and I've got a long time horizon, is what we call it.

Merrit Strunk:
Only 25% of those respondents to these folks who are participating therefore, can. One case said they had consulted a financial advisor, advisor or a financial professional. So let's get this straight. Of the millions of folks out there who are working and participate in 401 K, only 41% made changes. The rest of them sat it out and then only 25% of the respondents took some action to get some information and ask questions. I would say, folks, that when's the when's the next best time in your life to start a smart planning process or maybe even get this term a re planning of your financial situation? What's involved in smart planning? How do you start that? Well, I hate to say the word because, you know, if you're driving I've said this before, there's nothing like this word has amazing power. Let's see if it happens to you. You're going to change the radio station. When I say this word, create a budget loop. There it goes. There you go. So create a budget. So this is this is somewhat of a quote from Dave Ramsey is extreme wisdom here, folks. And it's difficult. It is the word budget to deal with. It says tell your money where to go instead of wondering where it went. That just seems like a better way to live life, doesn't it? A better way to live life. I'm going to tell it where to go instead of, you know, wondering where.

Producer:
Where, where, where did it all go?

Merrit Strunk:
How could it? What was the old statement? It says something like this. How can I be out of money? I still have checks left.

Producer:
Right. I wish it worked that way. Yeah.

Merrit Strunk:
Well, I mean, of course, the younger generation is like, What's a check? Exactly. Yeah. A what? So how do you get the budget started here? Well, you could calculate your income and then go through all your monthly and yearly expenses. You know, there's a great app that's out there through Dave Ramsey. It's called the Every Dollar App. But there is a mint You can go into mint do that is a nice app that does that tracks your expenses and it'll easily help you calculate what are your expenses and what's your income. So you may discover some areas where you can cut back or eliminate some of those costs, or maybe just get rid of them. You know, some people there's a pesky one in my life. My wife signed up for a $25 monthly bill for a car wash place, but it's like the gym that you don't go to. You just keep paying it and pay it and pay it. And that that car has not gotten washed every month. So maybe there is that car wash expense out there for you or some sort of subscription you signed up for on Apple at some point where you need to get rid of it and it's illuminating. So to do that step, it's an easy step to do. And I. You'll feel like you accomplished something. And then the other one that you can do is save regularly. Retirement planning should start as early as possible. I'd say just financial future should start as early as possible and continue even after you have entered into golden years, if that's even possible. That means there needs to be income stream and you have an income excess if you're going to be saving your retirement.

Merrit Strunk:
So consider that saving and putting it on automatic when you put it on automatic from checking and then deposit something in savings automatically, you pay yourself first and you don't have to think about it and it's automatically in there. The other one is just avoid debt. Oh, sure. Merrit It's easy for you to say just avoid debt. Just just, you know. Yeah, I know It's not that easy. It depends on what your situation is and what your expenses or investments are going to be. But debt creates you in a slavery situation to the creditor. I believe King Solomon has a quote like that. The debtor is enslaved by the creditor or something to that effect. So I know this is just, you know. Uh huh. Yep. Perfect. Down home knowledge here is try to pay off any existing debts before you retire and avoid taking on any new debts in retirement. That's tough. If you want to build a pool or, you know, or buy a new car. Hopefully you have the kind of assets where you just pay that in cash. You know, we have clients who actually do buy their new car and build their own pool in cash. Love for you to be one of those so you can get out of debt by doing what we call the debt avalanche. Are you familiar with the debt avalanche? It is prioritizing the payoff efforts to the highest interest rate versus the debt snowball, which is more of an emotional approach, which is pay off the lowest one. And when you do, you go, oh, good, we're making progress, right? I needed that emotionally.

Merrit Strunk:
I paid off the lowest one. Now I can take that money. I would have paid the lowest one and focus on the next highest one. The next lowest one. Mathematically, it's a bit odd. And, you know, you might hear if you listen to Dave Ramsey, he'll tell you a debt snowball and to do the lowest one because of the emotional benefits. But we advocate discipline and going after the debt avalanche pay off that first one, it could be 24%. And if you get that paid off, it's just going to help in a lot of other areas. So paying off that highest interest debt first, you're taking care of the debt that is costing you the most money to carry that debt. The longer you leave the high interest at sitting there, the more money you'll end up paying in the long run, for sure. It's like, should I pay my car off in cash? And if you don't, you keep paying that that interest. Well, that car will end up being a lot more. Same with a credit card. Any other purchase or a house, you'll end up paying off a higher cost of that house on the law in the long run. We're going to take a break at this end of this segment here and then we'll pick up and we're going to be talking about investing wisely. So if you've experienced 100% of the market loss, you want to hear this next one. So join us back here after the break. And in the meantime, drop by our website at RetirementUnbroken.com or give us a call. See you when you get back.

Producer:
As part of today's show you're a Retirement Unbroken is available wherever you listen to podcasts and online at RetirementUnbroken.com.

Producer:
Than I've ever been lifted before. Do you have a vision for what you want your retirement to look like? I'm Matt McClure with a Retirement dot Radio Network powered by a life planning for retirement can be overwhelming. A survey from Gobankingrates shows that one third of Americans don't think they know enough about retirement. And they're probably right. So if you fall into that category, how do you know where to begin? Well, you've got to know where you want to go before you start planning how to get there. That's where having a smart vision for your retirement comes in. Whether you want to be a jet setter during your retirement years. Want to take it easy in a quiet cabin in the woods or start a new adventure by opening your own business, you should set that goal and keep it in mind throughout your working years, retirement expert Dean Waguespack said during a recent TEDx talk. I want to challenge all of us to redefine retirement away from depart, remove withdrawal to a new definition, a blending of pay, passion and purpose. Still, retirement looks different for everyone. Sit down with your spouse and talk about your retirement goals. That will make it easier to determine how fiscally responsible you need to be now and how much income you'll need to make it happen after you retire. That's right, I said. Income. More and more retirees are finding that cash flow is more important than one big nest egg number. That's when you want to say, Hey, listen, I want to start thinking about all of this accumulation that I've done through these decades of working. How do I begin to think about turning what I've saved and what I've accumulated into paychecks after I retire? That's Lee Baker, president of Apex Financial Services, speaking to CNBC.

Producer:
He says annuities are a great option for most retirees to generate an income you can never outlive. That's especially important since life expectancy has grown over the years. So you'll need to plan for a longer period of time than you may think. So do you have a smart vision for your retirement years? That's a key question to consider as you start planning how to get there with the Retirement dot Radio Network powered by a married life. I'm Matt McClure. Are you concerned about inflation, political uncertainty, rising taxes and how it could all affect you and your family during retirement? If you have an IRA balance over 400,000, you could save six figures in retirement taxes that you would be paying over a 35 plus year retirement. Find out how much you could save today by scheduling your free Roth conversion consultation with Merrit Strunk at RetirementUnbroken.com.

Producer:
You may already know what you want your retirement to look like, but do you know how to start planning to get there? I'm Matt McClure with the Retirement dot Radio Network powered by AmeriLife. Where am I? I don't know. That's a question you must ask yourself before you start plotting out your retirement planning journey. After all, if you don't know where you are, it's pretty much impossible to get to your destination. Step one is keeping track of money that's coming in and what's going out. Otherwise known as a personal budget, it's an important thing to have. But a Gallup poll from 2016 found only 32% of couples keep a written budget of any kind.

PBS:
A lot of people tend to think of budgeting as prediction, estimating what you'll make in future months and how you'll want to spend it. But the most effective budgets work exclusively with present dollars. After all, you can't give orders to soldiers that don't exist, so the size of your army is only how much money you currently have in your bank accounts. And as general, your role is to give every last one of those soldiers a job to do.

Producer:
That from PBS's $0.02. Now, once you have a basic idea of what you're dealing with, reach out to a financial advisor, a professional who can go more in depth.

Ford Stokes:
We want you to do a financial checkbook checkup. It's just like getting a checkup at the at the doctor's office.

Producer:
Ford Stokes is founder and president of Active Wealth Management. He says getting a smart inspection of your finances is essential.

Ford Stokes:
You want to review your accounts, you want to look at your IRAs, your four links. Anywhere you hold assets, including cash, you want to check your balances, you want to review rates of return over the last 12 months, three years and five years. You want to answer this question, Do you have an income gap or do you have an income surplus?

Producer:
Understanding where you are now will help you plan for the retirement you want, leaving your future in your hands instead of the hands of the market or the IRS. So are you ready to reach out to a financial advisor for a smart inspection of your current situation? That's a key question to consider before you start your retirement journey with a Retirement dot Radio Network powered by a life. I'm Matt McClure. You're listening to your retirement unbroken to schedule your free no obligation consultation with merit visit RetirementUnbroken.com.

Merrit Strunk:
Hey, welcome back. This is Merrit Strunk and we were just talking about the basics of smart planning. I hope you enjoyed that little vignette of smart vision, you know, determining your destination, where you want to go. And part of that, you know, as you go through these steps and the smart planning is we're just heading on investing wisely. Wisely, That's a great word, wisdom, when we all want wisdom and specifically also financial wisdom. So investing can be an effective way to grow your retirement savings. But it's important to understand the risks associated with each investment. Example 60 over 40 portfolio. Very typical one that just got through having the worst year in 100 years in a century. That left a lot of retirees feeling like they got punched in the gut. Wait a minute. We we had a 6040. We're retired. Why did we lose all this value? Well, we talked about that in previous episodes and where this market very atypical equities were down, bonds were down, traditional hedges were down. And the reason you as a I don't know, a retiree that's listening here and had a 6040 portfolio, the reason why you got punched in the gut with this this market we just left is because you don't have some of the other aspects to a smart investment and investing wisely. Depending on your risk tolerance, you may need to use actively manage portfolios, not that passive index fund that gets you a 0.03 expense ratio if you don't know what that means.

Merrit Strunk:
We've already covered that before another other episodes and that the low cost financial investment you had actually cost you a ton in market loss because you don't have tactically manage portfolios that would guard your wealth in down markets, which is something we do. And very conservative folks retirement portfolios or active management. So that would help to prevent loss. There are pros and cons. Each one, it does depend on your situation, so consider now's the time to consult with an advisor and ask those questions. Is it right for you? Does it work for you? How do we help make sure that you reach your goals in retirement? So the other one, you know, aside from, you know, we're leaving here the invest wisely and invest smart is stay insured risk. This kind of risk is insuring against risk and against peril. And you need to make sure that you have adequate insurance coverage coverage during retirement. Yes. This includes health insurance. Yes, You're planning on getting Medicare. And then there's a medigap that helps mitigate some of those costs is not covered. And Medicare, life insurance, different kinds of life insurance that are out there. They've got living benefits, not just the death benefit, living benefits that can really benefit people during.

Merrit Strunk:
A retirement and long term care insurance. So without insurance coverage, you may find yourself at a risk of financial hardship. You could expect to face unexpected illness, potentially injury, and you'd want to make sure you always check the box in our financial planning process. Think about this. Remember the old castle, the old fortress? And what did they do in England? They they built moats around it, and they built walls around it. We want to build a moat around your financial well being so that if it's a market thing, if it's an economy thing, if it's a health thing, we've checked the boxes. We know what's going to happen. We've already accounted for those things in and proper and smart planning. The other one is stay informed. How many times have you had a conversation with somebody where they just appear, they don't know what's going on in their financial situation? One of the goals of this show, the reason why we do this show, is to educate people and help be them, help them be aware and educate them about the latest developments, what's going on in the financial scene, in retirement and taxes, inflation, economy, geopolitical and how that might affect you. So you'll be smarter and wiser about your financial and retirement situation. Retirement is a constantly changing landscape. It's important to stay up on on changing laws and regulations, financial products.

Merrit Strunk:
But how can you do that and do your life at the same time? In fact, in retirement, I'd make an argument that, yes, you want to stay involved, but don't get 12 newsletters and watch MSN, NBC and all these other talk shows, but you're just it'll just inundate you and depress you. That's why we, on a regular basis, send the communications to our clients to keep them updated on what they need to know about. We're not going to tell them anything they don't need, about need to know about things, just get emotionally way on them. We but we want them to be educated and smart. You know, they'll be the smartest clients in any one room at the party. Right? Well, my financial advisor says. Right. They'll be fun at parties. I always tell everybody, you'll be fun at parties when you tell somebody that they're going to move on the other side of the of the parties. Like that dude is interesting. All right. But they'll be wealthy and interesting, smart vision. They have a smart vision. You heard the little section we play for you just a little while ago. What will you retirement look like in the future, folks? What will you be doing during your retirement years? Who will you be with? Who are you taking care of? Question Mark. Right. That's an interesting.

Merrit Strunk:
What do you mean, taking care of somebody? Yeah. You live long enough and your parents live long enough. You may be taking care of them, even if you're geographically removed, distant from them. You know, fantastic Internet is allows you to stay in touch with everyone. You know, my dad is 87 years old. He caught COVID. Actually, he caught shingles just recently. That's a lot of pain. And you just don't feel like doing anything. Well, what about groceries? Can you venture out and get groceries? Can we get groceries delivered to you? That's what kids are doing remotely these days, making sure mom and dad are okay even when they're not feeling well. So you may end up taking care of somebody. So how how will you plan to fund your decades of your life? You may live 30, 35, 40 years in retirement, depending on when you retire, your genetics, how long you live. Replacement parts you get. So if you if you don't know how you will fund these things, how's that plan going? You know, I want to go on vacation. Do you know how it's going to be funded? I want to gift money to my grandkids. College education. Do you know how are you going to do that? How it's going to be funded? Asking these questions ahead of time, setting your goals. It's all part of the smart planning process, you know, for the unknowns down the road.

Merrit Strunk:
So 37% of Americans feel like they need more education on retirement planning, no doubt. Right. If two thirds are concerned and worried, wow, then 37% need more education. That means some somebody is worried out there and not getting education. I'm worried and I can't do anything about it. Ah, how's that feel? And then 52% of Americans wish they had more education on how to invest, right? So they want answers, they need education. They want to know specifically how to invest. I understand that. Especially the younger generations, they are more interested and involved and tell me why. That's a good choice and that's our goal. And we go through our plans of investment. We want to make sure that every client knows what they're in, how it's developed and made up, what's the recipe behind it and why you have it, you know, and it's not in concrete, it's not those passive percentages. Index funds are going to sit there and stay there no matter what happens in the world. So we recommend this time of the year to sit down, have a conversation with your spouse, significant other family member, and consider some important factors and then kind of turn that time machine forward is like, what will we be doing? Who will we be with? What do we want to do? Right, Social Security, Social Security.

Merrit Strunk:
And I saw the president on the on the airways the other day. And to me, it just looked like fear mongering, talking about tax cuts for the rich. And they're going to take your Social Security. Right. Social Security experience, one of the largest changes in 2015 that happened at midnight, I believe it was in the Obama administration. And it was a late night vote to make some changes on a like a budget omnibus bill. And in that they made some pretty significant changes. So could it change? Again, it would probably be a less sweetener or changes to the specification. So many seniors assume that Social Security will cover the bulk of their retirement financial needs. Nothing could be farther from the truth, right? Unfortunately, it's not the case. And Social Security will generally only cover about one third of your expenses. Jeepers one third. I'm going to need 70% of my expenses covered someplace else. How are you going to do that? Where's the income going to come from? Did you do the planning ahead of time to make sure that was done? So while a lot of people commonly assume that that they're stuck with a predetermined benefit, you can increase your payout by delaying when you take benefit. Did you know that potentially hundreds of thousands of dollars that you could get in your household over your lifetime If you ask the right questions and get a Social Security maximization report? You had one of those.

Merrit Strunk:
We'll be happy to do one for you. Make sure you're doing it right way. Taxes. Yep, that's it. End the show right there. Just taxes and walk away. Taxes. Right. There's a video clip of this little kid crying, and he's so upset and they go, He was playing Monopoly with his family, and he was just so broken up and he's crying. And they're like, What's the matter? He goes, Taxes. You pay taxes a monopoly and lost. The game is very upset. Tax is a common tax misconception is that your tax rate may go down and when you stop working, you can't count on a tax rate decrease simply because you're no longer making W-2. What if the what if the government increases the taxes every four years? Likely. So. Right. Very high chances. It's going to happen with 30, $31 trillion of deficits. Somebody's got to make some money and some taxes somewhere to pay for things. Did you know that from 1960 to 1963, the current tax rate that is currently in the position of 24%, that was actually 56% tax rate. Say what? Think about this, guys. A dollar. A single dollar bill. Matt, if you got a dollar bill. And you've got this 56% tax rate. Where's more than half of that dollar going?

Producer:
Not into my pocket. It's going to the federal government.

Merrit Strunk:
Right. The IRS. Right. You have to plan for tax changes in your retirement. That's one of the big gotchas for people who go, I'm good, or I just you know, I just need a big pile of money and I'm fine. Not so depends on your expenses, your health care, your long term outlook. And then all of a sudden you forgot to account for inflation and your expenses and taxes. And at some point later in your life, you're like those darn tax. Be crying like that kid.

Producer:
A monopoly taxes the taxes.

Merrit Strunk:
And the other one is Medicare. Right? So, yeah, we covered Social Security. Now let's talk about Medicare. Some retirees assume that Medicare covers everything from hospital stays and regular doctor visits to all the way to long term care. So basic Medicare plans cover the hospital, stay at a percentage and physical physician visits, and then prescription drug coverage, things like that. So generally about 80% and the person has to cover 20 and then you're into med supp there is no long term care component or add on to Medicare. So as you get older, it's likely you will have more health care needs. That makes sense. We're older, right? Until they until they have the cure for old age and they're talking about it. They did. They did it in rats. They got rats and they stopped them from aging. I don't know how viable that is in a human. I have to talk to Elon Musk about that. So as you get older, it's very likely you're going to have these medical expenses that go up. We call it the retirement smile. Here's the smile. Your retirement expenses for your lifetime at the go go years is higher and you go into the slow go and then into the no go. But oh, here come those medical expenses. And so you're going to pay higher in your medical expenses potentially, right? Certainly more than than when you were younger. So you've got to account for those. Okay. How about life expectancy? So life expectancy rates in United States have doubled over the last 200 years. We're living longer. And as I say, if we're living longer, the chances are you're going to need, what, more money than you thought you'd need.

Merrit Strunk:
You know, and it's so funny that, you know, you've got to use like either 90 or 95 years old as your bogey. We're going to live to 90 or 95 years old. Like, Yeah. Merrit You don't know me. I've got this thing right. I've got this. What's it what's, what's, what's a good one? I've got this thing about my my health, and I'm probably not going to live there now. You know, medical advancements have made it so that if you take 20 pills a day, you're going to probably live longer than you thought. Your shelf life is longer than you'd think, and you're going to need more money because of that. And that's just happening. It's just happening. There was a Time magazine cover a long time ago that said the first person who's going to live to 140 has already been born. 140. Yikes. I know. Now, are you fully cognizant? Mentally? I doubt it. I don't know if your brain was meant to go that far. I doubt it. But you may still be living. And that's going to take money to make that happen. Look, folks, if you don't have a plan for that, the state has got a plan for you and you are not going to want to be where they're going to put you. Right. You want to be taken care of at home. So it bears I mean, there's nothing like Mat. When I when I meet with 50 somethings and we bring up long term care not to not to execute it, but to educate on it, you've never seen somebody go glaze over so fast unless they saw grandma needing help.

Merrit Strunk:
Then it becomes then it becomes real. Really real. Really real. It hits home. It makes a big difference. Absolutely. Yeah. We plan on having a whole segment on long term care at some point from a from a person who's seen it and is taking care of family members. So I'd love to do that. So let's talk about smart inspection. How do you make the most of your current situation? So we talked about the beginning of this show and said, you know, you go to a professional if you as a medical condition, if you have a legal condition, you talk to an attorney. Think of it this way. It's a home inspection. You would never buy a house or a property until you had it inspected. Right. But at some point, you may want to have a re inspection, a smart inspection of your current situation, especially if the results aren't what you thought they would be. So we're going to say, let's do a smart inspection for you. Take control, take personal responsibility. Let's go ahead and look in that we will do a portfolio analysis. We'll take a look at fees. We'll take a look at performance risk exposure. It has never been a situation where we did a portfolio inspection. Somebody was not exposed to something they didn't didn't know or weren't or weren't aware of. So that is really illuminating. Why wouldn't you do that? Mm. Fill in the blank. You were too busy. Doing what? To pay attention to your financial situation.

Merrit Strunk:
Right. So there you go. Just fill it in, you know, just fill it in. So if you're going to live tonight to your 95th birthday, your plan needs to account for your 95th birthday. If you don't know what you're doing on Social Security, how it's calculator, how to get the most money out of it, not leaving 100,000 or more for the IRS. You need to find that out. Find that out. So we talked about doing things smart. So when you contact us. We encourage you to request your retirement unbroken report in this custom to you. We will include all these things. We will take a look at your entire situation, get you informed, get you educated. And you know what? That's complimentary. We'll do that for everyone who listens to this show and podcast. You just have to contact us, contact us. You can reach out through w w w retirement unbroken. You can call us at 858521 9700. We have just slaughtered you with education and information and hopefully reset your brain to start asking the right questions as you reach this time of the year. Sit down, have the conversation, reach out to us. Let's get you the information you need. Again, this has been Merrit Strunk, the host of the Retirement Unbroken Show and the lead advisor at Momentum Financial. And we do business all across the country. You don't have to be in San Diego to to contact us. We work all over the country and we hope that by listening, you become smarter and wiser and you will reach a better financial future. We'll see you next time.

Producer:
Investment Advisory Services offered through Brookstone Capital Management LLC. Bcm a registered investment advisor, BCM and the Buckeye adviser are independent of each other. Insurance products and services are not offered through BCM, but are offered and sold to 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:
So you know where you are now and where you want to be in retirement. So how do you plan to get there? I'm Matt McClure with the Retirement dot Radio Network powered by a MetLife. Do you have any other questions for me, counselor? There are a lot of questions to ask yourself when you start your retirement plan. Questions like When should I retire? How much money will I need? When should I claim Social Security? What about health care costs and taxes in retirement? This complicated puzzle means you're probably going to need some help coming up with a smart retirement plan.

Ford Stokes:
If you want to retire successfully, you really need to plan early, you know Inspector Jack Specht and get prepared. Putting a plan in place now while you're still working is a great idea.

Producer:
Ford Stokes is founder and president of Active Wealth Management. Once you find a financial professional you want to work with, they can help you answer all the questions you may have.

Ford Stokes:
Back to what Warren Buffett said. If you don't find a way to make money while you sleep, you're going to work until you die. So we need to do everything we can to figure out a way to make money while we're sleeping. We talk about this human capital versus actual capital. When you're young, you have a lot of human capital. You've got a lot of left, a lot of room left, a lot of capital left in your career, Right? But at the same time, a lot of people that are older, let's say you're 65, 70 years old. You don't have a lot of human capital left, but you should have a lot of capital that is making money while you sleep. And if you don't, then you didn't make the right decisions.

Producer:
There are also some retirement costs you may not have considered yet. Long term care, for example. Did you know it's not covered by Medicare? What about home renovations? If you decide to stay in your home instead of moving into a facility, your home might need some updates to ensure you're safe and comfortable. And those are just the tip of the iceberg. So do you have a fiduciary financial advisor or professional to help you wade through the complicated retirement planning process? That is a key question to consider. If you want to make the most of your hard earned money with a Retirement dot Radio Network powered by a married life. I'm Matt McClure. Are you concerned about market volatility, rising taxes, economic uncertainty, and how it all could affect your future in retirement? Then tune in to your retirement. Unbroken with your host, Merrit Strunk. To learn how you can protect and grow your hard earned money. Your retirement. I'm broken every Saturday at 1:00 PM right here on FM 96.1 and AM 1170. The answer Protect your hard earned money today and schedule a free no obligation consultation now at retirement on broken dot com. Big changes could be coming and they may affect your retirement. I'm Matt McClure with the Retirement dot Radio Network.

Producer:
Powered by a married life. Increases in costs, market volatility and fears of a possible recession. All have people who are close to retirement worried about the future. Some people who were considering early retirement are staying in the workforce, while others who had already called it quits are going back to work. Marketwatch recently published a list of eight big things retirees and pre-retirees should keep an eye on. Some of them are pretty obvious. Like number one, inflation. As the prices of goods and services continue to go up at rates not seen in four decades, just paying for everyday things could eat through your retirement savings more quickly than you thought. Another concern Social Security. The trust fund is set to be exhausted by the year 2034. Potential changes to save the program could have a big impact on your retirement years. Two items on the list have to do with savings. How much money to set aside for retirement and how to address a growing gap in that amount versus what most of us have actually saved. Yahoo finance contributor Vera Gibbons recently reported that the savings gap has been exacerbated by the pandemic, with a lot of folks dipping into their retirement accounts just to get by.

Vera Gibbons:
We are in an inflationary environment here, and some of the experts I spoke to said given the fact that costs are going up for just about everything, they expect more people to actually tap into their retirement accounts or contribute less this year. Also, keep in mind that people are still quitting their jobs at a record rate, and that group may also be tapping into their retirement accounts too, to cover their costs.

Producer:
Health care spending and drug prices are two more things on the market watch list of retiree concerns. And they could be impacted by the last two items on the list Diabetes, which continues to affect more Americans each year and uses up a good portion of the nation's health care resources and exercise, which could actually bring costs down by helping you stay healthier longer. So which of these items is your biggest cause for concern heading into retirement? That's a key question to consider. As economic uncertainty continues to cause headaches for us all. With the Retirement dot Radio Network powered by AmeriLife, I'm Matt McClure.

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