6 Steps to Get Your Retirement Plan Back on Track

4.12.24: Audio automatically transcribed by Sonix

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

Speaker1:
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Speaker2:
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.

Speaker1:
Welcome to Money Matters with Mike, with your host, Mike Zeno. Get set for a full hour of financial information and economic news affecting your bottom line. Mike 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 Mike Zeno.

Speaker3:
What's up, what's up, what's up? It's Mike Zeno coming to you from Fort Mill, South Carolina. Happy Saturday people. What a great time to be alive in these United States of America. Money matters with Mike as a show designed to arm you with information and give you plenty of meat on the bone to chew on each and a week. And hey, we are absolutely bringing the heat again. On today's show, we're going to teach you how to build a roadmap for your retirement, as well as how to navigate some common obstacles as you approach those golden years. As always, I have the distinct honor and privilege of being joined by the one and only my co-host and producer extraordinaire, Mr. Matt McClure. Matt, how you doing today?

Speaker2:
I am doing great, Mike. A little, you know, a little on the tired side because I'm in a different time zone. This week I've been attending a conference out in Las Vegas, so it's like, uh, you know what? What time is it? What day is it? Is it really this early in the morning or is it this late at night? I can't tell, but, uh, regardless, I am happy to be with you once again this week.

Speaker3:
You know, I can relate to the, uh, the feeling of tiredness. I have had 22 appointments with, uh, eager potential clients wanting to learn how to secure their financial future over the last two days. So I have been extremely, extremely busy. Some of those have been in person. Some of those have been virtual via a zoom video conference. But, you know, we we put a lot of, uh, meat on the bone into people's plans this week. And so those folks are definitely excited, and I hope that many of our listeners will take advantage of the fact that we actually offer complimentary consultations and can put some meat on the bone and your individual financial plan for each and every single one of you who listen to our show today or on podcast, wherever you may be listening at your own leisure.

Speaker2:
Yeah, that's absolutely right. And you can get that consultation by just, uh, giving Mike a call at 7045601573704560 1573. You can also go online to Money Matters with mike.com. That website once again is Money Matters with mike.com. Of course we'll be bringing you that um, that information about the uh, the ways to get in touch and the ways to reach out for that free consultation all throughout the show today. So just listen up for it. If you missed it, as I just said it. All right. Uh, a lot of great things to get to today. Of course, we want to say a big, huge thank you to all of the listeners who are tuning in, Mike. Of course. Um, you out there are the reason that we have a show at all. So thank you, thank you, thank you. Um, also, as Mike said, you can get us on a, on a podcast wherever you subscribe to podcasts. You can also check out our YouTube channel for some, uh, some really unique content there. Also highlights of the show. Just search for Money Matters with Mike on YouTube as well. Well, so are you approaching your retirement? If that is the case as it is for, well, pretty much all of us, unless we're already in retirement and time is marching on, right? We share a six step checklist to help you prepare, especially for those you know. You might feel like you're a little bit behind. You might feel like you need some, uh, have some catching up to do. We're going to tell you how you can do that. Um, also some some icebergs that might be lurking just below the surface. Um, just call yourself Captain Smith from the Titanic. Right. Uh, you got to avoid these icebergs. Um, we're going to give you those yourself.

Speaker3:
Captain Smith, because he actually hit the iceberg, so. Well, yeah.

Speaker2:
This this is true.

Speaker3:
And lucky. So that or, you know, or captain prepared. That would be the best name. I think captain prepared that this is.

Speaker2:
Very true. This is very true. I guess I chose the wrong name there for the, uh. For the captain of our ship. Of our financial ship? Yeah. Don't let Captain Smith, uh, be the captain of your ship, captain it yourself, and have Mike Zeno right there beside you doing the navigating. How's that man? And then why it pays to have a plan. We've actually got results from a study showing that it does really pay to have a plan, a formal plan for your retirement years. And we're going to talk about that coming up, reveal those results, and then talk more about how Mike helps out listeners just like you with their individual financial situations. All right. So a lot to get to here. First though, let's start out by getting some inspiration and check out our quote of the week.

Speaker4:
And now for some financial wisdom. It's time for the quote of the week.

Speaker2:
And this week's quote comes from Jim George, who said this. It's not how you start that's important, but how well you finish. That's very true. I you know, I would kind of argue that that, you know, both are important, but in the end, it is how you finish. It's where you wind up that really matters. And, uh, you know, that that part of it, I would say is very, very true. It is.

Speaker3:
And it reminds me, you know, I was a multi-sport athlete in high school and in college. And one of those sports was was track. And I used to run the 100, the 200, uh, the third leg of the four by 100. And I also pole vaulted. And then in college I threw the javelin, uh, as well, because, you know, high schools don't want people impaling kids. So, um, but, you know, coming out of the blocks, you stumble sometimes and it's not how that start affects you, but it's how well you can quickly, you know, just negotiate yourself back on path and finish strong within that race.

Speaker1:
Hungry for something to chew on? Here's some meat on the bone.

Speaker3:
And when you apply that to your retirement savings, I think his quote import, uh, excuse me, uh, emphasizes the importance of consistency, right. Consistently saving and as well as your investment habits over time, rather than focusing maybe on, uh, the initial amount that you have to contribute to a retirement account. So when you're talking about retirement savings, that quote suggests that the key to building a substantial nest egg isn't necessarily having a large sum of money to invest right from the beginning, but rather making those regular contributions and allowing those contributions to grow through the use of compound interest over the long term. So starting early and contributing consistently, even if the amounts are small initially. Because, let's face it, you know, when you're in your 20s and your 30s and you're just starting out and you may be growing a family, uh, sometimes life gets in the way and you might not be able to contribute as much. But just even if the amounts are small initially, those can make a significant difference just due to the compounding interest over time. And so that compounding actually allows your investments returns to generate their own returns. We talk about it, you get interest, and then you get interest on the interest, which accelerates the growth of your savings over those years. So while it's certainly beneficial to start saving for retirement as soon as possible and to contribute as much as you can, this quote reminds us that the ultimate measure of success as far as retirement savings is concerned, is the size of the nest egg when you actually retire, rather than the initial amount that you started with. Uh, when you first started?

Speaker2:
Yeah. That's right. And a great point to make there, as you say, because definitely not in your highest earning years, the vast majority of us. Anyway, uh, when you're in your, you know, 20s, uh, and even into your 30s, um, you know, I could not well, especially with inflation and, uh, all of that, just the rising cost of living. If I had to go back to what I was making when I was in my early 20s, forget about it. I'd probably be under a bridge somewhere, you know? So we all.

Speaker3:
I think we all would. Either that or living with mom.

Speaker2:
Uh, right. Exactly. Yeah. No. That's true. Mom, my mom wouldn't let me live under a bridge, so. Yeah, I'd be. I'd be in the guest room, probably my old room at at her house. So that that's the way that would go. But. Yeah. No, you're absolutely right. I mean, it is, um, paramount how you finish, how you wind up those stumbles at the starting gate. They happen. And don't let those discourage you from making good, steady progress, from recovering from the stumbles and making good, steady progress, doing the catching up that you might need to do and, uh, achieving or even surpassing the goals that you've set for yourself. So I think that's 100%.

Speaker3:
Absolutely.

Speaker2:
Yeah. All right. And talking about, you know, kind of how to achieve your goals, that's sort of the the main topic of discussion today. We've got six key tasks for people who are approaching retirement. And this is from a morningstar report talking about, you know, a lot of folks who are approaching retirement. And really, I think, Mike, these are probably a lot of the people that you talk to every day who have, you know, they're getting close and they're like, ah, I just don't know if I'm ready. I don't know if I'm prepared. I don't know if I'm on the right track. Right. That I know hits home for you, because those are the people that you talk to all the time.

Speaker3:
It is. I mean, the people that I talk to mostly are in their late 50s to early 60s, uh, sometimes mid 60s to late 60s as well. And they. Don't know if they can afford to retire. Right. They they have spent their, their working years just building and building and building. And now they're seeking that guidance on their plans for retirement, as well as how to make the most of all of their hard earned savings. So, um, I love working with those folks because, you know, people that have something we, you know, no matter how much you have, whether you have 10,000 or 10 million, you're going to get the same Mike Zeno. It may be a little bit different plan, obviously, because if you've made the bed, I got to make it as comfortable for you as I possibly can.

Speaker2:
Yeah. Absolutely. Right. You know, it might be, uh, that you have an old innerspring mattress and some of the springs have popped out and, you know, all that kind of stuff. But Mike's gonna make it more comfortable for you when you make that bed. Um, but. Yeah. So and we're talking about specifically, I think people who are sort of in that retirement red zone to, you know, five, maybe even ten years before or after retirement, uh, you know, that that, um, those folks are the ones who are in a really, really critical time. Talk about why that particular time frame is so critical for our listeners.

Speaker3:
Yeah. I mean, it's crucial. I mean, when you say critical, it is crucially critical. We're going to use some alliteration because you know why? Number one, people are living longer. Right. And so you may be retired almost as long as you spent working. And so you want to make sure that you have a plan that you have confidence in, that your income won't be affected by how long you live. Because, I mean, pardon my French here. Uh, but it would suck to have a plan to live until 85. And then happy birthday. Now you're 86 and your money is broke. You know, run out and you're gone. And so this checklist that we're about to go into is for all of you who are approaching retirement, and you want to give yourself the absolute best chance of success.

Speaker2:
Yeah. And speaking of that checklist, let's dive right into it here. Uh, because there are some great points to be made along this path. Right. So step one is build your human capital. You got to, I guess, invest in yourself, not just monetarily, but also invest in your skill set and other things.

Speaker3:
Yeah, so it is never a bad idea to add a new skill, whether that's by going to school or taking some courses just to kind of invest in that human capital by continuing to work even. Um, and in your final years of your career, think about this. You're probably making more money than you've ever made in your lifetime. Okay, so now is the time to be really socking that money away and avoid that lifestyle creep that we talk about. So unfortunately, most people, as they make more money, they tend to spend more money. And so what we're trying to get people to do as they make more money is save more money. So your income is your greatest wealth generator. So make sure that you're taking advantage of that. And, you know, especially in that final decade of your working career before you pull the trigger on your retirement.

Speaker2:
Yeah, 100%. And a lot of people too, Mike. They don't just want to retire, they want to relaunch. You know, it's, um, it's something where a lot of people might call it quits from their corporate job that they've had for decades and decades and say, you know what? I want to do something that is mine. I want to take ownership of something. I want to launch something, whether it's a, uh, even, you know, a product or a service or a small business in their hometown. And I think that, you know, that is something else, too, that people can, um, really plan for. And, uh, you know, if that's your inspiration in life, if that's what keeps you going, what keeps you ticking? Yeah, absolutely. Work toward that. And and doing it.

Speaker3:
There's no doubt in my mind that if you are really, really good at what you do, um, you you're a prime candidate for that relaunch. You can maybe set up a consulting business where you're doing it on your own time and working your own hours and serving as a mentor to those in your field who don't have the knowledge and experience that you do. You can actually pour that into other people, and that can provide additional income, as well as reduce the need for, uh, portfolio withdrawals in retirement. So definitely something to consider.

Speaker2:
Yeah, absolutely. And then number two here that we're going to share with our listeners, Mike, is to have a game plan for your Social Security benefits. It's not just, okay, I turned 62. I'm eligible for Social Security. I'm going to take it. You know what? In under certain circumstances, that could be fine and dandy for you to do. Under a lot of circumstances, though, you want to wait at least until your full retirement age. But, you know, for a lot of folks out there, especially if you're looking at monthly wanting to maximize your monthly income, waiting all the way out until you're 70, if at all possible, because you're going to get a significant bump up in your monthly payments.

Speaker3:
This is true. And so, you know, because taking Social Security at 62, you're only getting $0.70 on the dollar. You're not even getting your full benefit. It's not until, uh, our listeners turn 66, 66 in some months or 67, you know, that, that they receive 100% of the benefits. And then every year you wait beyond your full retirement age, you're getting those delayed retention credits to where you can actually make just a whole lot more. So you may consider working longer and delaying the filing for Social Security just to increase your ultimate benefit. And so think about this. Your final benefit amount is based on your top earning years. They take the highest 35 years. And so any year that you're making whatever you're making now presumably, you know, 40, 50, 60,000 or more dollars a year, that is going to replace a year when you were 18, 19, 20, making six, seven, $10,000 a year. So, uh, also another thing to do is collaborate with your spouse. If you're in a married situation, you want to both of you speak with a licensed professional so that you're able to develop a Social Security maximization strategy that allows you to benefit, uh, lifetime off of, you know, which and when and who and where and how each of you should be drawing and claiming your benefit.

Speaker2:
Yeah, there's a lot that really goes into it here. And, you know, a lot of people are concerned about Social Security. Mike, obviously you can can help them out with that and determining what they might be able to do with their Social Security as part of their overall plan.

Speaker3:
Absolutely. And we understand the fact that many of our listeners are indeed concerned about future cuts to Social Security and how that might affect their retirement, because we've already spoken about it, you know, on our on our show many times in the past couple of years about how the, the OSA trustees and that trust fund, um, they've said that that trust fund will be bankrupt now by the year 2033, if nothing is done and they'll only be able to meet 70% of their obligations. So what we can do is provide you the peace of mind, knowing that you do have a Social Security maximization plan that's customized for both you and your spouse if married, uh, as far as your benefit information and knowing exactly when you should. So again (704) 560-1573. Or you can contact us on the website at Money Matters with mike.com. You can email me at Mike at Money Matters with mike.com and take advantage of this complimentary offer for our listeners specifically, because after all, we love helping you guys.

Speaker2:
Yeah, absolutely. That is what it is all about. And you know, I mean, let's let's go into just a little bit here, Mike, of why uh, the why of that, um, you know, Social Security, uh, being, you know, the like what you just talked about, um, the old age and Survivors insurance trust fund running out of money in about. Nine years. At least that's the projection. And it's the projection from, you know, the Social Security Administration. It's the projection from the powers that be in, uh, in the government. So it's like, if it were to happen before that, I wouldn't be surprised. But, um, that that's just, you know, a little editorializing on my part there. But at the same time, it has real life consequences for our listeners. So let's talk about exactly why that is.

Speaker3:
I think the biggest reason is that, you know, when Social Security was first introduced, beneficiaries, uh, were supposed to have been dead for four years. Okay. The average life expectancy at the time was around 58 years of age. And you couldn't draw or begin drawing Social Security until you were 62. And so, you know, people weren't living that long back then. Well, guess what? We're in 2024 right now. And beneficiaries are living much, much longer, meaning the program pays the people who are drawing it over a much longer period of time. Back then, you might have lived a decade. Well, now people are living two and even three decades plus over that time frame. Couple that with the fact that over 10,000 baby boomers are still retiring each and every single day, meaning that the share of workers paying into the system via payroll tax okay has been falling relative to the number of beneficiaries who are actually collecting. And that creates an imbalance. And so that as a result, um, without any action from our lawmakers. And again, I'm going to reiterate the Old Age and Survivors Insurance Trust Fund that supports Social Security is estimated to run dry by 2033. So, um, if that runs out, they're not going to be able to meet their obligations. So it is definitely time to get serious in 2024. And this is an election year. And there's already so much uncertainty in the world that affects retirees and pre-retirees. So please do not wait until you are ready to retire in order to start your planning plan now.

Speaker2:
Yeah, 100%. Uh, great. Great point there. Because you gotta the sooner you plan, the better off you will be, right? It's not just a, uh, you take the money and run situation when it comes to Social Security, and so you'll want to be prepared for it. And the thing that I love about what you, uh, talk about Mike, so often is that, you know, you want to be in a situation where Social Security is not what you're relying on for your retirement income, but it can be. It can be the gravy. It can be the cherry on top. Um, and then, you know, if it's there in its current form, by the time you get to retirement, great. If it's there in a different form, great. If not, you're fine.

Speaker3:
Yeah. We don't want to, um, have to rely on whether or not the government changes the rules on us. Okay. I've heard them, you know, talk about at least the rumor mill, right? Pushing the qualifying age, the initial qualifying age from age 62 out to age 70. And if that happens, people who are relying on Social Security earlier on through their early to mid 60s. Um, well, if you have to wait till 70, you're going to need something in place to combat that delay in the ability to draw your benefit. So that's why it's so very critical, crucially critical. All right. To have a plan in place.

Speaker2:
Yeah, absolutely. I love the alliteration continues on this week's show. Uh, and folks remember once again you can reach out. Speaking of alliteration, Money Matters with Mic.com is the website. Step number three. Here is you approach retirement Mike is to maintain your safety net. So we just talked about like you know the government federal government safety net. Uh, that is there that exists in the form of Social Security. There are other, um, you know, programs that are a part of that. But we're talking now about really your personal safety net that you have to establish yourself.

Speaker3:
Yeah. I mean, and so when we're talking about a safety net, of course, we've beat this horse multiple times on our show. We're talking about having an adequate emergency fund. And so if you are continually adding to your emergency fund and making sure that if you've had to dip into it, you build it back up by having at least and I'm talking about a minimum of six months of living expenses, I would much prefer you having a year worth of living expenses, because that will provide you with a little bit of peace, peace of mind, and the safety net and help you to avoid having to make premature withdrawals from your retirement savings. So one of the things that we like to talk about is maybe the fact that while people are living longer, uh, there's also going to be. Be a greater need for long term care. So if you or anybody in your family has ever gone into an assisted living facility or a nursing home facility, or heck, even had in-home health care, you know that that gets very, very expensive. So consider long term care insurance options and then develop a plan for potential long term care needs. Because if you think long term care is expensive, just consider how expensive long term care actually is.

Speaker2:
Yeah, I mean, it's absolutely true because on the front end, you know, you might be thinking, okay, well this is just too expensive to to be able to pay, uh, every month this, you know, a monthly premium for a long term care plan, something like that. Or, or maybe, uh, you know, some other type of vehicle, a life insurance policy or even an annuity. A lot of those have provisions in them, uh, where there are like, long term care riders where you can take money out and to be able to pay for long term care, you might think, oh, well, that's just too expensive for me to even think about right now. Well, look at this report, Mike, that we have. It's using, uh, numbers from the centers for Medicare and Medicaid Services CMS. This is from regions who compiled all of this. And I'm talking, you know, that it ain't cheap. Uh, long term care.

Speaker3:
It is not cheap at all. In fact, the report went on to say that at least 70%. So seven out of ten people who are aged 65 years and older are going to eventually need long term care services at some point in their lives. And the cost of that long term care depends on three main factors. Number one, the kind and length of the care that's needed. Number two, the provider chosen. And then number three the location. So they broke it down. And if you need adult daycare just adult daycare, you're talking about an average of a little over $1,500 a month. If you need in-home health care, then you're that basically more than doubles a little over $3,500 a month. And then non-medical home care is about the same. If you have to go into an assisted living facility, the price goes up to around 3600. And then nursing home care. Uh, we're talking about an average of $6,600 a year. Now, this is the national average. So it's taking into account a lot of middle America where the cost of living is much cheaper. You start going into our major metropolitan areas. I can speak from experience here in the Charlotte area. And I know that you're not going into nursing home care for less than around 8 to 10 grand a month. Um, it's very, very expensive.

Speaker2:
Yeah, yeah. Like like we say, it is not something that you want to sleep on because it is something that really has to be planned for when you're talking about expenses that high, on average, you say $6,600 a month. Uh, but but yeah, I mean, you talk about that, that's, uh, just from your experience, 8 to 10,000 right there in the Charlotte area. Mike, if think about if you're in San Francisco, think about if you are in Boston, if you're in New York or Chicago, like those areas, surely paying a lot more than that. But if you're I mean, I'm sure if you're in, I don't know. Wahoo! Nebraska. Maybe it's a little cheaper, but it's, uh, on average if you're talking about that much per month. Yeah, a lot of places are paying a lot more. Yeah.

Speaker3:
And if if it ever came down to that much a month, I would probably adopt the phrase that my mom has. And she's like, man, if I ever get to that point, just walk me into the woods and leave me.

Speaker2:
It's as long as I can survive, I'll do it. And then, you know, that's it's up to God. After that. It's about right. Um, step number four here is, uh, really, I think what brings a lot of all of our discussions today together. Um, and that is schedule a checkup for your portfolio. You know, Micah, you've got, um, a lot of expenses that we've been talking about, uh, just there and we're talking about long term care expenses, stuff that is not cheap. Um, you've also got, uh, concerns with Social Security going forward, uh, and all of the different concerns about that that we've been talking about. So, uh, check up on your own personal portfolio. Super important.

Speaker3:
It is. I think it's paramount. Okay. And whatever you're doing right now, just stop for a second, please. If you're driving, just pay attention to what I'm about to say, because what you think you know can be the most detrimental when it comes to long term retirement planning. So consulting with a licensed professional who is able to review your plan, your portfolio structure, even if you've been managing your own investments independently, just take comfort in the fact that there is a potential shortfall in your retirement savings. You still have time to make adjustments if and only if that, uh, you take some action, increase your savings, explore your options. But consulting with that licensed professional is going to be able to help you identify any potential shortcomings in the future. Things that you might not even see because, again, what you think you know can be the most detrimental.

Speaker2:
Yeah, that's absolutely right. I you know, we were talking earlier about uh, uh, early, you know, being in your early 20s and even on into your 30s. And so if I knew what I thought I knew back then, um, I would have, I don't know, I would have been just absolutely genius. Uh, I'm laughing.

Speaker3:
Because I knew everything.

Speaker2:
Yeah, exactly. Well, you and me both, uh, tends to happen at that age, but. Yeah, I mean, you know, what you think, you know, can be detrimental. And I can say from experience. Yeah, it was pretty detrimental back, back in those days. Yeah. Well, number five here on our list of, uh, things to do, if you feel like you need to sort of catch up a bit on your retirement plan and, and get there, uh, in a more sound way to that age, whenever you want to call it quits from the workforce. Step number five is to sprint to the finish and also maximize your savings. Those two, uh, going hand in hand here, people can really step up what they're doing as they near that retirement age.

Speaker3:
You know, I talked about stumbling out of the blocks when when running track and running those races and, and the biggest thing you wanted to do is give it your all, sprint to that finish and, and bow your chest out and lean forward. Right. Well, as people near retirement, once again, we find that they are earning more income than ever before within their entirety of their careers. Okay, so they're able to take advantage of an empty nest transition by redirecting some of that money toward retirement. Okay. And consider saving a significant portion of your income, aiming for 30 plus percent if possible, in those years that lead up to retirement. And what that'll do is definitely bolster your retirement portfolio. And then, of course, prioritize those tax sheltered vehicles like IRAs and 401 S and all the other employer sponsored plans by taking advantage of the catch up contributions that are available to individuals over the age of 50. Think about this for one second. If you're turning 50 this year, the government allows you to save $30,500. Okay, so if you're able to work another ten years and max out your retirement contributions, just your contributions are over $300,000 plus the match if they offer one plus the growth. And that's just a ten year period. If you work until you are 65, then that number increases to uh, $450,000. So we're talking about a significant opportunity for you to really turbocharge your savings toward the tail end of your working career.

Speaker2:
Yeah. Talk about a game changer and a lifestyle changer. Uh, really, you know, if you're able to do that, um, that's a significant amount of money. And then you convert that into income and you're just talking about the principle, right? What you put in to those types of accounts, not not even the growth. And as you say, the the matching contributions from an employer, then you start turning that into income. And that in retirement can just absolutely mean the world to you. And so yeah, maximize those contributions. Absolutely. So um, and another thing too, Mike, is we often say. Timing is paramount, but you don't want to try and time the market. For example, like as Warren Buffett said, it's not timing the market. It's time in the market. Right? But timing can mean everything when it comes to something called sequence of returns risk.

Speaker3:
Let's talk about that for a second, because a lot of people may have heard the term, but they don't really understand the risk inherent with sequence of returns. So let me illustrate this for you. Okay. Think of somebody who retired back in 2007, right before the financial disaster happened in 2008. And then that person whose money was exposed to the volatility of the market, they lost money in back to back to back years 2008, 2009 and part of 2010 before the markets turned around. That individual's money would never last as long as somebody who had retired in 2010 and then saw something that nobody alive or dead had ever seen before in history. The longest bull run in history of the United States stock market, a ten year bull run. Now, the outcomes of each of those individuals retirement would be completely different. The person who retired in 2007 and lost three years in a row. I mean, that's just total disaster. Decimation of the retirement portfolio. Most likely that person had to go back to work, okay, versus the person who retired in 2010 and was able to just have gain after gain after gain in the market. You know, that's what you have to be really, really concerned about. Now, my crystal ball has been broken for 53 years, right? We can't predict the future, but we can use common sense. And so as retirement approaches, folks need to gradually shift a portion of your investment portfolio towards safer investments to mitigate the sequence of returns risk that.

Speaker2:
Yeah. And that's a great step number six in our different steps here to take. If you are approaching retirement and feel like you need to get caught up, is to protect your savings from that sequence of returns risk, which can, just as you say, might decimate your retirement years. And what I would encourage folks to do, Mike, is if they have questions to just pick up the phone or go online, give you a call.

Speaker3:
They can. (704) 560-1573 money matters with Mike. Uh. Com just again reiterating that holding assets in safer securities can help protect the portfolio from those potential market downturns early on in your retirement years, when your portfolio value is at its highest and with interest rates, uh, still high, the fed has announced that they don't think now that they're going to be cutting those rates, safer investments still offer significant return potential. So again, if you have any questions on that, just reach out and give me a call (704) 560-1573.

Speaker2:
And Money Matters with mike.com is the website. All right. So let's recap those six steps that you should take as you approach retirement here. Mike. Number one was to use your human capital by continuing to work and adding skills to your tool belt. Number two, determine your social Security strategy. You've got to have a plan for that. Maximize your future payout as a result, maintain your safety net with your emergency fund by utilizing a whole a holistic insurance options. Right. So long term care life insurance as well. Uh, schedule a checkup on your portfolio. And of course, you just heard the contact info there. How you can do that with Mike Zeno? You can sprint to the finish and maximize your savings by taking advantage of catch up contributions for those 50 and older, and also protect your hard earned money from sequence of returns risk. Consider options that will protect and grow your wealth. And those are out there. And Mike Zeno can tell you about them with a complimentary consultation. And, uh, yeah, that that's absolutely the easiest thing in the world to do, right, Mike?

Speaker3:
I mean, one thing that we hope to deliver on this show is value, right? For your time spent listening to the show, we want you to pick up nuggets here, nuggets there to ultimately put yourself in a better position. But if you've placed actually picking up a phone or going to the website, giving me a call or scheduling a complimentary consultation, if you've placed that action into the draw of procrastination, just open that drawer and simply call the number or website and look forward to helping each of you reach your retirement goals and dreams.

Speaker2:
That is what it is all about for sure. Well, all right, so, um, now we get to the point of the show where you do not want to be the captain of the Titanic. Um, that is absolutely for sure, because, you know, it was actually this week in history, uh, when the Titanic went down, it sank on its way from, uh, England over to New York, hitting an iceberg. Very famously, more than 1500 souls lost. It was the deadliest sinking of a single ship at that time, of course, and just, uh, went down in history as one of the biggest tragedies that that we've ever experienced as, as humanity. So now we've got some icebergs that you will want to avoid. You do not want to be Captain Smith of the Titanic here. When it comes to your retirement, you want to have Mike Zeno working alongside you as your navigator as you get things going here. And we've got these unseen icebergs, uh, that really could sink your your ship, your retirement plan. Uh, that, uh, that ship is, is your retirement, and you don't want it to go down. And number one iceberg that we're going to talk about stock market volatility. Boy that uh, we've we've seen quite a bit of that here lately.

Speaker3:
So people got lulled to sleep from 2010 to 2020. I mean a monkey could have made money in the stock market by just throwing money at it. And that monkey would be a very rich and wealthy monkey at the end of those ten years. So but you know what has happened since then? Well, we've had a global pandemic then we had a good year, then we had an absolute crap year in 2022. Then last year, 2023 was great. And so far this year, well, the jury's still out, right? It's kind of been up and down so far this year. Why? Well, there's a lot going on. And as we've mentioned before, this is an election year. So listeners during your accumulation phase, that's when you're building your nest egg. The stock market will help you build wealth for retirement. However comma okay. As retirement approaches, protecting your savings should become a priority. And then diversification can also help mitigate the impact of market downturns. And the whole reason why we diversify is that if one sector of your portfolio is underperforming, we hope that the rest of the sectors are at least staying above water. So, you know, as a retirement income tip, you can reduce the risk. Risk in your portfolio, as well as establish your own personal pension that creates an additional lifetime stream of income with one simple strategy. And if you would like to explore personal pension options for your retirement to be able to maximize your retirement income potential, give me a call (704) 560-1573 or visit Money Matters with Mike comm. And let's get in contact with each other so that we can help you establish your own personal pension.

Speaker2:
Yeah, a great way to protect yourself there from that stock market volatility, which is that iceberg number one lurking just below the surface. Ready to take down your retirement ship here. Iceberg number two is actually taxes. And it's something that you got to plan for because as we say Mike you know do you think taxes are going up or going down in the future?

Speaker3:
I asked people a lot of times what their biggest expense is. And you know what almost everybody says, um, Mike, it's my house. And I just look at them, I'm like, no, it's not. And they're like, what do you mean? I'm like, it's taxes, okay? They tax your income. And then whenever you purchase something there's this thing called sales tax. So you have to pay tax on the thing you purchased with the money that was already taxed. And then if you own anything of significance like real property, a home, a car, a boat, guess what? You're going to have to pay property taxes with the money that was already taxed from the sales tax when you bought it, and then taxed on the income that you make. So in essence, you really don't own it. The government does, because at any point in time, if you fail to pay those taxes, guess what's going to happen? They'll come and take your stuff. And we find like just Matt just mentioned that most people believe taxes are going to increase in the future. Um, while at the same time they have almost no money in a tax free bucket. So you want to have a bucket strategy. You know, you want to have tax free money that you can pull from in retirement. You want to have tax deferred money that you can pull from in retirement.

Speaker3:
And then obviously you want to have the uh, the taxable money, uh, as well. So if you have all three of those buckets, you're going to be in good shape. Let's think about Medicare in the future, especially if you're a high income earner. You guys may face additional monthly surcharges called an income related adjusted amount or Erma for short. Um, because Medicare has a two year lookback on your, uh, income. So if you've made a lot of money those couple of years previous to, uh, excuse me, what's the word I'm looking for Medicare, claiming Medicare benefits, then you may be in for a little bit of a shock when it as far as the cost of your Medicare health care. So some of the strategies, like maybe converting your savings over to a Roth IRA or maybe doing something called a Roth conversion, where you're taking some of the money out of your employer sponsored plan and paying the taxes on it so it keeps you under the threshold for the next tax bracket elevation, and moving that money over into a Roth account. That might be a way to help lower your future tax burden and protect you if and when the government changes the rules on you.

Speaker2:
Yeah, which they could do at any point in time. You know, we talked about several risks on the show, one of those legislative risk and regulatory risk as well. Um, because, yeah, they they can, you know, change the rules, update the policies and procedures at any time and change the law at any time. Although right now it doesn't seem like it can get any lawmakers to agree that the sky is blue on any given day. So that's that's a whole other topic entirely. Um, but yeah, anything can happen at any time. So you want to be prepared for that. Another iceberg to be prepared for as far as, uh, your retirement goes is long term care costs. Yeah. We we talked about this, um, just a little bit earlier in the show, but it is such a significant thing. I think it bears repeating here, Mike.

Speaker3:
It does. I mean, we talked about just how the average average cost in the United States for nursing home care is 6600 bucks a month. And that if you're not prepared for that, I mean, think about how much that would take out of your retirement nest egg, even if you just spent a year in a nursing home, much less two, three, 4 or 5 years. Right? So average annual cost for home health care, assisted living care as well as nursing homes. Guess what folks? They're increasing too. And inflation is having a much greater impact in these areas as well as Medicaid uh, medicine rather and health care. So you have to have a plan. And the right long term care insurance policy could save you a significant amount. Of money in retirement, so definitely something to consider, especially getting it when you're young enough and you can get some of those prices locked in at your at your current age, as opposed to waiting until you're already in your 70s or 80s. And then it's just astronomical and unaffordable at that point.

Speaker2:
Right? Absolutely. And of course, you can explore any of those options by going to Money Matters with Mike comm and clicking on the button there for a free consultation. Um, iceberg number four longevity. Um, this kind of goes a little bit hand in hand with iceberg number three because long term care we talked about it earlier. People are living longer right. And so you want to make sure that you have sources of income that are going to continue to pay you no matter how long you live.

Speaker3:
That's true because I mean, retirement for most folks is going to last somewhere between 2 and 3 decades, which is going to require careful management of savings. But if you're somebody who's fortunate enough to retire, maybe in your 50s or early 60s, and you have longevity on your side with the advancements in medication and technology, you may be somebody who has to prepare for a 30 to 40 plus year retirement. So maximizing guaranteed income sources like personal pensions as well as social security is vital to the success as far as combating that longevity we've talked about before, you know, the top concern of retirees today is outliving their savings. And the number one regret of everybody that was surveyed, nine more than nine out of ten people regretted not saving enough and squirreling away money for retirement. So please, please, please learn from their mistakes. Take charge of your retirement and financial future and do it today. As loyal listeners, we're offering you the opportunity to schedule a complimentary retirement and financial consultation with us today. You can schedule it today and we'll fit it into your calendar in the weeks ahead. So just again, don't delay act today.

Speaker2:
Yeah, that's right 704 5601573 is the number 704560 1573. You can also go to Money Matters with mike.com. Uh that is the website for you to reach out as well. And and this is sort of I think ties everything up in a nice little bow here, Mike. This next section of the show, because there's a study by T Rowe Price that really sheds light on what we've been talking about. As far as the value that you discussed earlier, I want to bring value to you each and every week here on the show. Mike wants to bring value to you when he gives you, you know, that that free consultation assembles that plan and starts working with you as a listener and as a new client here. Um, but there, you know, is actual evidence from this large scale study showing that individuals that do have a formal financial plan have 2 to 4 times more wealth when entering retirement compared to those without one. Mike. I mean.

Speaker3:
Just just think of that for a second. I mean, if if you're just somebody who's plugging along, maybe you're a teacher, maybe you're a firefighter, maybe you're a, you know, a nurse, maybe you work in an office and you've got a 401 K, and you're plugging along and putting your anywhere between 5 to 15%, and you don't really have any help. You might have, say, $300,000 when it's time to retire. Saved up. Okay. But with financial professional guidance, um, you could have 1.2 million. That's four times that amount. I mean, that's a significant difference in the quality of your retirement lifestyle. Then if you go it alone, remember what you think you know can be the most long term detrimental. And so, you know, the statistics said 64%, 64% of baby boomers reported moderate to high levels of stress about their retirement savings. However, comma. All right. The respondents to this survey that had a formal plan reported 60% higher confidence about their financial outlook. I mean, think about that for a second. Would you be more confident with 1.2 million in your plan versus 300 grand? I think you would. Okay. Also, 60% of the respondents indicated that their employers are the primary source for financial education and guidance. And that is a scary statistic. Matt.

Speaker2:
Yeah, no, you're absolutely right. That is a scary statistic because we've talked about, I think before on this show, something like and forgive me, I might be a percentage point off here, but it's I think it's something like 8%. People are the only ones from a different study who actually seek help from a financial professional like yourself. So ta ta, then look here and see 60% of the folks in this survey saying that their employers are the primary source for financial education and guidance. Boy, that is um, that's scary because do they I mean, do they really have your, uh, needs and wants and, uh, and goals in mind? Like what? How much value, how much true guidance is, say, the HR person at your job, uh, really providing to you.

Speaker3:
And I think more importantly is the question is, are they really the most qualified people? You know, if Sally and HR, who has just been a and not anything against Sally and HR people are needed and loved. Right. But if if she's just processing paperwork, how much does she really know about helping you protect and grow your retirement savings? So therefore, we encourage all of our listeners to consult with licensed professionals like us, whether it's us, whether it's your brother in law, whether it's whoever. But I happen to know a pretty good one.

Speaker2:
And so do I. Uh, his name is Mike Zeno. You can reach out to him at Money Matters with mike.com, or you can call 7045601573704560 1573. Now among pre-retirees in this particular survey, Mike, awareness is really low when considering investment products that are designed to support retirement income needs. I think too many people are still focused on sort of that one big magic number and not really about how they're going to have income in retirement.

Speaker3:
Yeah, right. Well, when people are in their 20s, 30s and 40s, um, and even kind of maybe mid 50s, because especially at that point you're making more and more and more money. You're really concerned about the accumulation phase, building, building, building, building. But where I see most people, um, needing to refocus and shift their vision in their, especially in their 50s and beyond, is then on the preservation and the distribution side of retirement. How do you make the money that you have earned last as long as you live, whether that's ten, 20, 30 or 40 plus years into retirement. And so a better goal to pursue instead of concentrating on building, building, building is once you reach those 50s, now you need to start concentrating on maximizing the retirement income, because income is what it's about in retirement, and that is what will allow you to take those vacations to play the rounds of golf, to go out to dinner with your friends, to buy the boat. You're going to have to have the income to support all of those wants. Uh, and then obviously your needs.

Speaker2:
Yeah, 100%. You know, Tom, Tom Hegna was the one who sort of coined the phrase paychecks and play checks, right? You want to have those paychecks that cover your monthly expenses? Those are, you know, your your needs. All of the things that have to be taken care of. But the play checks as well to do all the things that you talked about, you know, go, uh, to Bora Bora or whatever, you know, and do all your traveling. Go, uh, there you go. Not a bad list you got going there, uh, to see, uh, you're going to see the grandkids, you know, going to do this, that or the other, all the things that you want to do in retirement, you want to have both of those. And and notice it's not, uh, you have your, uh, pay nest egg and your play nest egg. It's you have your pay check and your play check because it's, it's a, it's an income thing. Not really a nest egg thing. So yeah, I mean, that's, um, crucial to think about and remember. And really the other thing, you know, to, uh, get from this survey, I feel like, is that actually demand for financial planning services is strong, but it's the strongest among those who are within 1 to 5 years of retirement. We're talking about that retirement red zone again there, Mike.

Speaker3:
Absolutely. Because I mean, if you're within 1 to 5 years, it's time to get serious. And that's not the time to find out that you don't have enough save to be able to generate the income that you're going to need, even to maintain your current style of living. And the sad reality is, is that most people have a very decent salary when they're working, but once they retire, that is a significant drop off in income, especially if you are a high income earner and you're making over $100,000 a year, you are going to be in for a very rude awakening unless you have done, uh, your diligence and prepared with, you know, saving into your employer sponsored plans outside, uh, retirement investment vehicles and things that will generate income in retirement. So the more time that you have to accumulate and invest your savings for retirement, the better off you're going to be in the long term. And of course, we recommend that people get started as soon as possible. When was the best time to plant a tree? Well, that was 25 years ago. When's the next best time? That would be today.

Speaker2:
100%. And in our last couple of minutes of the show here, Mike, just tell our listeners what they get.

Speaker3:
Yeah. I mean, whether you as a listener are looking to optimize your investment portfolio, whether you're looking to maximize your Social Security benefits, or maybe you're somebody who just wants to create a comprehensive retirement plan, our team is definitely ready to assist you every single step of the way. And so through a complimentary consultation, we'll develop a comprehensive analysis and will thoroughly assess your financial situation, helping you build a personalized plan because each individual is just that individual and unique. And that plan is going to align with both your retirement goals as well as your dreams. So another thing that we can do is do a fee evaluation and discover exactly how that you're paying in fees for each of your retirement savings accounts will help you identify any unnecessary costs, and we'll find ways to help you optimize your investments. Okay, then we have the personal pension and income planning because, again, it's not all about the size of the nest egg, but you will teach you and you can learn how to set up a personal pension to secure a reliable stream of income for your retirement that once again, you can never outlive. And then, of course, Social Security maximization planning. If you are unsure if you have questions about when is the best time to start your Social Security benefits, we will guide you through the process and ensure that you make informed decisions based again on your unique circumstances. So 704 5601573 or visit the website Money matters with Mike comm to book your consultation now and we look forward to helping you achieve your retirement dreams.

Speaker2:
A lot of great information out there, and we really do encourage the listeners to reach out with any questions and reach out for that no obligation consultation as well. But I want to thank you once again, sir, this week for all that you bring to the table all of the time, all the knowledge and the the truth bombs and all the things that you bring to the listeners every week. And we'll talk at you again next time, sir.

Speaker3:
Matt, thank you, sir, for everything you bring to the table and for setting me up to deliver those nuggets that I hope each of our listeners pays attention to and applies to their individual situations. But to our listeners, whether you're listening to us live on the radio, whether you're listening to us on podcasts, at your own leisure from anywhere in the globe, thank you from the bottom of our hearts. Without you, we do not have a show. So whatever you are doing this weekend, I hope you enjoy it to its fullest extent and as always, make it a great day.

Speaker1:
Thanks for listening to Money Matters with Mike. You deserve to work with a licensed financial and insurance professional who can offer strategies for protecting and growing your hard earned money. To schedule your free, no obligation consultation, visit Money Matters with mike.com or pick up the phone and call 704 560 1573. That's 704 5601573 not affiliated with the United States government. Mike Zeno does not offer tax, legal or investment advice. Consult with your tax advisor or attorney regarding specific situations. Opinions expressed are subject to change without notice. These opinions are not intended as investment advice, nor do they predict future performance of any product. All information provided is believed to be from reliable sources. However, we make no representation or warranty as to the accuracy of any statement. This information is intended to be educational in nature and does not provide a guarantee or a specific result. All copyrights and trademarks are the property of their respective owners. Amara Life assumes no responsibility or liability for the content of this message. The information contained herein is provided on an as is basis with no guarantees of completeness, accuracy, usefulness, timeliness, or the results obtained from the use of this information.

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