10.28.22: Audio automatically transcribed by Sonix

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

Producer:
Any examples used are for illustrative purposes only and do not take into account your particular investment objectives, financial situation or needs, and may not be suitable for all investors. It is not intended to predict the performance of any specific investment and is not a solicitation or recommendation of any investment strategy.

Producer:
Welcome to Money Matters with Mike, with your host, Mike Zaino. 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 Zaino.

Mike Zaino:
What's up? What's up? What's up? It's Mike Zaino coming to you live from Fort Mill, South Carolina. Happy Saturday, people. What a great day to be alive in these United States of America. The whole goal of this show is to arm you with information that you can actually use. And we give you plenty of meat on the bone to chew on each and every week. And today we are absolutely bringing the heat again. I am really excited for today's show. On getting a head start on your New Year's resolutions. And once again, I have the distinct honor and privilege of being joined by the one, the only Mr. Matt McClure. Matt, how are you doing today?

Producer:
I'm doing great, Mike. You know, every every time I think about New Year's resolutions, I think about my late mother-in-law who used to say every year she goes, her New Year's resolution was the same. And she would say, I want to lose weight and be more organized. Those were two things. She never really did either one of them. I just have to say. But, hey, she had them. She had goals. Whether she achieved them or not was a different story.

Mike Zaino:
You know, it's funny with New Year's resolutions and I'm sure we'll talk about this as we progress in the year. But, you know, everybody has them. They make them. And then by around March, they kind of fizzle out. You know, it's like in the beginning of the year, you see so many people in the gym and the weight rooms. And then by March, you know, a third of those people are left. You know, so so being able to have New Year's resolutions and be accountable to yourself for them speaks volumes about what you really want to do. And I think today's show, when we get to that Meat on the Bone segment that's going to talk about just that, if you want to get serious on start your planning for 2023. Now, as far as just finances are concerned, then this is a great show to listen to.

Producer:
Yeah, and people might say, you know, okay, why are they talking about New Year's resolutions? It's, you know, not even Halloween, for crying out loud. It's about to be. But, you know, it's not even Halloween. So. So why are you talking about New Year's resolutions? Well, you got to start planning now, especially if you're going to set yourself up for that success that you want to have in the new year. Right. So that's that's what we're talking about 100%.

Mike Zaino:
We're just taking the following The lead of the big box stores that are have had Christmas stuff in them for the last month. Right. You know, for a month or month behind on New Year's Day.

Producer:
Very, very true. So there we go. It's we're just we're catching up with the retailers. It's what we're doing here. But we do have a lot of great info coming up here on the show. Mike, as you said, we've got all of our usual segments and some bonuses and a lot to get to. But we wanted to say that you can actually go to the website, folks. Money matters with Mike dot com MoneyMattersWithMike.com. That is, Money Matters with Mike dot com or you can call the phone number 704 560 1573 to book a free absolutely complimentary consultation. That phone number once again by the way 704 560 1573. It rings right in Mike Zaino's pocket. And so it goes directly to him. You're not going to get some call service somewhere, you know, overseas or in the middle of Nebraska or something. You are getting Mike Zino in person live and in person there. And you can also listen to the show on the website Money Matters with Mike dot Com MoneyMatterswithMike.com. Or you can subscribe to us wherever you listen to podcasts. We would love if you do that, subscribe, get the notifications. So you know when a new episode comes out each week and leave us a comment rate the show on those podcast platforms, we absolutely love hearing from our listeners and we would love to hear from you. All right, Mike, So as we get started here, before we get into the meat of the show and then the meat on the bone, we want a couple of important reminders for our listeners here. The first one, the annual enrollment period. Boy, we are right in the middle of it right now.

Mike Zaino:
We are in fact, we're in the second week annual enrollment period for folks that are wanting to either join Medicare or change a medicare plan, whether it's a supplement or a Medicare Advantage plan that goes from October the 15th through December the seventh. So if you in any way, shape, form or fashion need some help navigating the ultimately confusing waters of what is Medicare, give me a call and let me know. How I can help you with your Medicare needs. Or you can visit our website and schedule a contact one-on-one through our contact US form.

Producer:
Yeah. And that's again on Money matters with Mike all spelled out and all one word dot com. MoneyMattersWithMike.com The second reminder I want to share with folks is is coming up here. It'll be here before you know it. November 8th. That is a big important day. Yes, it is election day for the midterms. You know, Mike, I'm right here next door to you in Georgia. We have had tremendous early voter turnout in our like three weeks of early voting that we have total. We've gone through a couple of them now and smashed all the early voting records. So people are engaged and we want to make sure that our listeners are engaged as well, right?

Mike Zaino:
We absolutely do. Because, I mean, you need to understand that if you don't vote, you can't complain about what's going on in the cities, on the local level, in the state, you know, at a state level or in the country on a federal level, if you your voice is the only thing that you have. And a lot of folks say, oh, you know what, my one vote is not going to matter. Well, if everybody thinks that way, then guess what? The people who actually get out and vote are the ones who are going to change the face of how we are governed or keep us in the exact same way that we've been governed, especially over the past couple of years. There's a website out there that's called Ballot PDA, Ballot, PDA, PDA, dot org. And what that will do if you go to that website, you can actually take the time to learn about what candidates stand for, what issues they believe in, and ultimately make an educated decision and not just vote for who you think looks the best or speaks the best, or is a member necessarily of your party or affiliation. I mean, I really do think that we should vote for the best people that we are going to feel is going to impact the greatest number of people for the good. So November 8th, that's next Tuesday, get out and vote.

Producer:
Yeah, absolutely. Want to encourage you to do that and make your voice heard. I have as I said, I mentioned early voting. I've already voted here in Georgia. So so there we go. My civic duty is done for this cycle, so I hope yours gets done by November 8th as well. So we've got a bunch of stuff, as I mentioned, Mike, coming up on the show, and I want to sort of tease a couple of things here. We're going to do have a nice look at how to eliminate your income gap in 2023, the first step. And that obviously is you've got to recognize you have an income gap or an income surplus. That's the ideal situation. So we're going to talk about that, a little inflation demonstration on the way. We also will talk about the tax brackets, the new tax brackets for 2023 and how that could be beneficial to folks. So we'll go over that as well and much, much more. So a lot to get to. But first, we're going to share some words of wisdom.

Producer:
And now of wholesome financial wisdom. It's time for the Quote of the Week.

Producer:
So we got we're running a two-for-one special this week here on quotes of the week here. Mike. Yeah, we got two of them. You've only spent the money for one, but we're giving you two as it's a BOGO. So here we go with our first quote of the week. It comes from John Maynard Keynes, the English economist whose ideas really did fundamentally change theory and practice of macroeconomics and economic policies of governments as well. And so Keynes said this, quote, By a continuing process of inflation, government can confiscate secretly and unobserved an important part of the wealth of their citizens. There you go.

Mike Zaino:
That's why we call inflation the invisible tax, right?

Producer:
Yeah, it's true. And we've we've talked about that a lot. Of course, as inflation has really just been sticking around for a lot longer than anybody wants to see it. That is very, very true. And some wise words there from Keynes. And so our next quote of sort of bonus quote of the week here comes from an unexpected source. And if you're a fan of Run-D.M.C., that now see, those are words you probably shouldn't expect me to say, huh? If you're a fan of Run-DMC during the eighties, especially when, like in their heyday. Right. And like, the hip hop heyday of Run-DMC, then you're probably familiar with Jam Master Jay. And so he was the deejay of the influential hip hop group. So he said this and I love this quote, actually. He said, quote, Make sure to save for the future and keep making money. And that's very wise and very simple and to the point and I love that.

Mike Zaino:
Keep making money, I think is the key to, you know, to everything. Over the past few shows, we've discussed the first three steps of building a solid financial plan, the first one. Being setting some financial goals, the second one being, creating and sticking to a budget. And the third one. Last week we spoke about mitigating risk.

Producer:
Hungry for something that you on here? Here's some meat on the bone.

Mike Zaino:
In today's Meat on the Bone segment, I am going to discuss the fourth step of building a solid financial plan, which is building wealth. So it kind of goes in hand in hand with Jam Master Jay's words of wisdom saying keep making money. Right? So I was reading a well-written Nerdwallet article that was written by Andrea Coombs on how to build wealth in five Steps. And I really wanted to bring that today's to today's show rather Just because these simple rules, there are five simple rules that will help your retirement savings keep it on track for the long haul, which means that the future you who is going to be financially secure and who doesn't like the sound of that, right?

Producer:
Matt? Oh, yeah, definitely. It's that that is music to my little ears here, Right?

Mike Zaino:
Right, right. So, so the first step that we've talked about a lot on this show in past episodes is to automate your savings. Think about that. Life is busy. Maybe you've noticed that means that you need to make sure you're contributing to your retirement account automatically, because whatever the crisis of the moment is, whether it's paying off a credit card or paying off your car loan or mortgage note, that's going to feel much more important in the moment than saving money for some future date that may be decades away. So you want your money working quietly for you in the background no matter what's happening in your life or in the world. And that's where automatic savings comes in. And added benefit to auto savings plans is that you get to think less about your retirement account. And why would you ask that ignoring your account is a good thing? Well, because when the market's tanking and your account balance is trending down, you don't want your hands anywhere near the sell button as long as you still have time for a complete recovery to happen. Now, if you're within five years of retirement or you're already in retirement, you don't necessarily have the time to let it come back. And I have solutions for you that you can discuss when you call them. The second step is to revisit your savings every single year, at least once a year. As we've been saying, when you're investing for a date that's far into the future, it is absolutely fine to let your money just sit there quietly, enjoying the highs and the lows, surviving those lows of the financial markets.

Mike Zaino:
But it's true also that you probably shouldn't ignore your account entirely. And here's why. Thanks to the market's gains and losses, your original asset allocation, which means how you divvied up your money amongst the different types of assets, is going to shift and it will eventually get out of whack. So, for example, say that when you first opened your account, you decided to go with a 70% risk portfolio. Well, if the stock market has increased in value since that original allocation, your proportion of stock investments is also going to grow. And so maybe now you're at 80% of your holdings are in equities or stocks. And if there were to be another stock market crash and your portfolio is 80% in stocks rather than 70% in stocks like you had originally chosen, you would be in for an unpleasant surprise. And so to reduce that risk, you need to rebalance, which means getting your investments back to the percentages that you chose originally. And the closer you are to retirement, the less risk you can afford to take. And so if all this talk of asset allocation and rebalancing is starting to make you feel a little overwhelmed, that's understandable. Just do me a favor. Breathe deep and remember, there's a really easy way to get going on your retirement savings goal, and that's to hire a financial professional to help you navigate and guide you through this process. And I happen to know a pretty good one.

Producer:
Hey. Hey. I know a guy. His name is Mike Zaino, and his website is Money Matters with Mike dot com. MoneyMattersWithMike.com How's that work out for you and me? And the number that you can call also folks, is 704 560 1573, 704 560 1573. There you go.

Mike Zaino:
There you go. Number three on the list to building financial wealth is to hike your savings rate. And so did I mention how awesome it is that you're saving for retirement? It is. It's absolutely awesome. And you've already done the hardest part by getting started. So the next step is pretty easy. Each and every single year. You should increase your savings rate a little bit. It's easy because you can do it if you just set your mind to doing it. Let's say you get a raise or you get a bonus or you get some unexpected found money, why not just send a little bit of that to your future self by increasing your savings rate? And if the year isn't great financially, you can always choose not to do it. And so small increases in your contribution rates can have a huge effect on your future financial security. Remember how you need to visit your account once a year to rebalance on that same date every single year? See if you can't just inch up your savings rate just a little bit higher or even easier if your 401. K gives you the option to switch for an annual auto increase. Go ahead and flip that switch right now.

Producer:
And that goes back to sort of the automating. You know, the thing that you were talking about, like automating your savings, right? So that makes it easy. Anything that makes it easy for me, like kind of kind of dumbs it down, automates the whole thing I am all for because I if I have to make an effort, it's another thing to do. And as you said, we're already busy enough. So there you go. Turn on that switch, flip it, and it just makes the whole process easier.

Mike Zaino:
There you go. So number four on the list would be to avoid high fees, the same way that saving just a tiny bit more each and every year can push your retirement savings to lofty heights. Seemingly small fees can have the absolute opposite effect. Taking a huge bite out of your account over your lifetime. And you could lose, believe it or not, more than $200,000 to fees inside of your 401 K alone, according to a NERDWALLET study. So how do you make sure that your money goes to your retirement lifestyle rather than to some random investment company? Well, one solid way is to make sure that you're investing in low cost index mutual funds, for an example. And what would count as low cost, you ask? Well, a mutual fund that has an expense ratio of less than one half of 1% is a decent deal, although the best 401 K plans offer some funds that charge less than one fifth of 1%. So 0.20%, which is obviously even better. Fees are so important. And please. Do not skip this. Log into or onto your IRA or 401 K accounts, then click through to the summary page for each of your investments. The main feed to focus on would be that expense ratio. And so see if you can find a mutual fund with a similar investment objective, but that has a lower expense ratio because over time, I mean, think about it, up to $200,000 in fees in a 401 K over the course of your life, I'd rather have that 200 grand in my account balance, wouldn't you meant. Yeah.

Producer:
Oh totally. That that'll come in handy in the retirement years there. That, that amount of money. I mean that's you, you know get that in a vehicle where you can have that as part of your income in retirement And boy, that makes a big difference for sure.

Mike Zaino:
All right. In the fifth and final step in those five steps that are going to help you build wealth over time is to stick with the market. Right now. Again, I want to refer back to your own individual time horizon. If you are retiring sooner than later, then you need to protect what you've worked so hard to build. And the market may not be your friend, but if you're younger and you still have ten or more years to go with a goal like retirement, the stock market actually is your friend. And that's not to say that it can't be scary, right this year. It can. It's been scary. Heck, it's been absolutely petrifying when that market tanks and it will tank. It always does, but it always goes back up as well. And so when the market is tanking, it's no surprise to me that plenty of investors find themselves thinking, well, I'll just get out of the stock market now and I'll get back in later when things are looking up. The trouble with that thinking is that it's impossible to know when the market is going to turn around. And by exiting the market, even for a short time, you risk missing out on all kinds of gains. It's easy to time one or the other, right? But it's very, very difficult to get it right twice.

Mike Zaino:
So the next time that the market falls, just think of it as the best sale ever and that you're buying shares at a discount thanks to those periodic transfers that you're making from your paycheck and your retirement into your retirement accounts on an automatic basis. You're currently buying new mutual fund shares at a fraction of what they would cost during the market's high point. And when the market does turn around as I know it will, then you're on your own way to more shares than before, and they're all going to rise in value. Bottom line, building wealth takes time, and it's not usually built overnight. It takes consistency. And the more you contribute towards savings and investing, the faster you should build wealth. And please don't be discouraged if you're just starting out as long as you stick with it. Compound interest and time will eventually work their magic. Once you get started, pat yourself on the back because you're a bona fide investor, a planner of retirement. Now go out and tell some friends how it's done. Or better yet, send them a link to my show at Money Matters with Mike Dotcom.

Producer:
I love that. That's absolutely true. And yeah, you can be well on your way. And those are some great, great tips there for people to really take control of their own financial situation, because that's really, you know, the goal of the show here is to educate people to to give them the resources that they need to be able to do that. And that's especially the goal of the Meat on the Bone segment each and every week. And, you know, you talked about, you know, that last point sticking with the market. And we've seen you know, we've had a look at some of those, you know, peaks and valleys in the market over time, over a long period of time. And if you try to time the market like you were talking about and you happen to miss out on the biggest days of gains in the market, boy, you can miss out on a lot. And so if you've got the time to do it, yeah, you've got to stick around with it because you know it does recover over time. As you say, any time we've had a down market, we've had it go back up. It's like the opposite of one of Newton's laws. I guess what goes up must come down. It's what goes down must come up in the stock market. That's it's been that way, you know, for, for decades and decades.

Mike Zaino:
Yeah. The only cautionary word that I would put out there over the airwaves is that, again, if you're within five years of retirement or you're already tired, especially if you're drawing down on those retirement funds, you can't really afford to lose money because if you're taking money out and losing money at the same time. Your retirement investments are never going to last you as long as you once had planned for. And so, again, if that is you, we have solutions for those who are nearing retirement and in retirement whereby you can participate only in the gains of the market and be 100% protected from any market volatility. In other words, you never lose a penny. So if that resonates with you, if that kind of rings a bell with you, no matter how much you have in your retirement accounts, give me a call and let's get a plan together that you can have confidence in.

Producer:
And that number to call folks is 704 560 1573, 704 560 1573. Well, as we continue on here, Mike, you know, we've got these new tax brackets that have been released from the IRS and potentially some good news for our listeners out there. But we got to say this with one caveat here is that we're you know, I'm not a CPA, you're not a CPA, We're not the tax professionals. That's not how we make our living here. We encourage you to seek the counsel of a tax expert near you to kind of navigate this on your personal basis, but for educational purposes, which again, is the purpose of this show, to educate you that your tax income levels for each of the different brackets are going up. And explain to our listeners how that could potentially be a good thing. They're not not used to hearing good thing and IRS in the same sentence.

Mike Zaino:
Yeah, that's definitely not the norm for sure. But this year, across the board, they're going up relatively about 7% at each bracket. And a lot of folks don't understand how they're taxed. And they may say, hey, if I'm at the 24% tax bracket and I make 100,000 a year, for an example, they think that they're paying 24,000 in taxes. And that's not the case because the first 22,000 is taxed only at 10%. Then for between 22,080 9450, that's taxed at the 2200, which is the 10% of the 22,000 plus an additional 12% of the excess. And so I'm not going to bore you to death with each and every single taxable income limit and bracket. But the idea is, is that you're going to pay if you're making whatever you're making, you're paying 10% on the first 22,000, you're paying 12% in excess of the 12 22,000, but under 89 and then 22% in excess of the 89, but under 190 and change and so on and so forth. Right. So a lot of people just don't understand that and they think that it's a blanket tax. Now, what I just gave you were the limits for married filing joint. And they are a little bit different than if you are a single filer. But again, the good news is, is that across the board you're not paying a blanket level flat tax, but it's incrementally based on the different levels and you're only paying the additional tax on each one of those thresholds that you surpass.

Producer:
Yeah, that's that's right. And that's, you know, the way that the tax system works and can be confusing to people because you're right, you hear oh yeah, I fall in the let's just say 24% tax bracket for example, and you think, okay, gosh, well I've got to make sure that I have that that they're taking out enough out of my paycheck or that if I'm a 1099 employee, there are worker rather than I've got to make sure that I'm setting enough aside for that. And so I'm going to set aside 24% of my total income. But you don't have to set aside that much. This is why it's important to seek the help of a professional. Like we said, to start off this segment here, because you've got to have that help to to sort of navigate these issues because they can be confusing.

Mike Zaino:
They can. And especially for folks that are in the moderately higher to higher income brackets, you definitely want to make sure that you're paying as you go and you don't get caught with your proverbial pants down when it comes tax time, because that's just not a pretty picture to paint in your mind by any stretch of the imagination. And so, again, our whole goal is to educate. No matter what income level you are, a rising tide lifts all boats. And so just by virtue of having this information out there and at your disposal, if you ever have questions about any of this, again, we've said it a zillion times, just pick up a phone and give me a call or fill out a contact request form on the website.

Producer:
And that's MoneyMattersWithMike.com. Once again. Well, so that's some good news from the IRS. Also some potentially good news, although a bit of a two-edged sword here from the Social Security Administration. I'm talking about the COLA, the cost of living adjustment for 2023. We have been mentioning this and we have mentioned it as well here, here recently when we were thinking, you know, that could be upwards of 10%. That's what a lot of people were saying before the announcement was made. But the COLA, the cost of living adjustment and Social Security, 8.7% for 2023. And, you know, that's that's a good thing. People are going to see more on their their paychecks from Social Security.

Mike Zaino:
It is a good thing. I mean, that's up from last year's COLA 5.9. So if you add those two years together over the last two years, that's a 14.6% increase and the largest that we've seen in decades. Well, the good news is that your Social Security income benefit, it has that built in adjustment to help protect your buying power. But the bad news is that inflation is still wreaking havoc on American families, particularly in the areas of food costs, energy costs, new and used vehicle cost and travel costs. And this is the part, you know, why we want all of our listeners to have a solid and tested plan for both protecting and growing their hard earned retirement dollars. And you need to outpace inflation in order to protect your buying power. And we can help you do just that.

Producer:
Yeah, and you set it right there, Mike. You know, we want all of our listeners to to really be able to protect and grow their hard earned money. It's just like Jam Master Jay said, you know, save for the future and keep making money. And that's that's really it. And that's what it comes down to when we talk about, well, just about everything that we mentioned here on the show. So that's great. The cost of living adjustment or the COLA for 2023.

Producer:
Want to know where your hard earned money is going? It's time for an inflation demonstration.

Producer:
You just mentioned inflation here, Mike. It is still wreaking havoc on American families and consumers. Gosh, if you if we've been to the grocery store lately, I usually haven't directly been in shock over grocery prices because I will sometimes order for grocery delivery online. And, you know, when you when you order online, it's kind of ordering something from Amazon. It doesn't sting quite as much as when you're in person. But then I went last week to get groceries in the actual store, and I think the price of eggs, I was like, weren't these half the same price like last time I bought them at a store? It was crazy.

Mike Zaino:
Yeah, my wife, she she laughs at me because I still have grocery prices in my mind from like, I don't know, maybe the nineties or the early 2000s. And I'm like, Why did we spend so much on, on, on groceries? Well, she asked me to go to the grocery store not too long ago and just to pick up a few things, I mean, like I had like eight things in my checkout basket and I had brought $100 bills thinking surely that's going to be enough. It was $112 for those eight things. And I'm thinking to myself, Man, it is a good thing that I'm not the one that does the grocery shopping all the time because we'd be eating rice and beanie weenies.

Producer:
Right? Oh, yeah. I have been there. I have been there thinking that you're going to have enough and it's not quite enough. But we'll always play that game too. Well, I think this is going to come out to so-and-so and sometimes I'll get it right. Then most of the time the total comes out to well above what I think it's going to be in the end. But so, you know, our inflation demonstration this week, we're looking actually at the consumer Price index, which actually takes into account food prices, but it also takes into account a lot of other things in the economy. Right. So so tell us a little bit about consumer price index and where things stand right now.

Mike Zaino:
Yeah, So so it rose more than expected again in September, still hovering near the highest level seen since the early 1980s. And the rising cost of living is bad news for workers, especially whose hourly earnings are down 3% from a year ago. And that's just leaving more Americans living paycheck to paycheck. Right now, 32% of adults say they regularly run out of money between pay periods, and that's according to a company called Salary Finance. It's a staggering to me.

Producer:
Yeah, it really is a staggering number. I mean, that's nearly, you know, just about a third of U.S. adults running out of the money, you know, every other week or even every week if they get paid on a weekly basis. And, you know, we've got a lot of adults, too, that just don't feel not only like they can't make it, you know, week to week or month to month, but year to year and, you know, on into the future as well.

Mike Zaino:
Yeah, no, I mean, more than half of the United States adults feel as though they're behind on retirement savings, which to me is is heartbreaking. It just it just breaks my heart to think that people who have worked and busted their hump for however many years of their life and because of the current state of the economy, they're not able to save. Some people have stopped saving altogether because of inflation, because they need that money just to survive. And so. Of those adults that say that over a third feel like they're significantly behind. And that's due to, again, a recent report from Bankrate. So, again, it's just it's heart breaking to realize the state of the current economy and how it is affecting so many people in a negative fashion, especially those that did not have a plan in place, because the time to put a plan in place is before the catastrophes happen so that when they do happen, you're able to meet them and greet them head on. Instead of reacting, you're able to respond. And the difference between reaction and response, they sound kind of similar, but they're dichotomous, which means a reaction is not good. A response is positive, right? If you react to medication, typically a bad sign. If you respond to medication, that means it's working and you're going to be better off. So my medication is in the ability for me to prescribe a plan of action to take to help you meet those catastrophes head on and have them not affect you like they're affecting a third of United States adults at this point in time.

Producer:
The way that I think, Mike, the difference between reaction and response is like like reaction. I almost picture like like an instinctual thing, like an animal, like just reacting, attacking something because it feels threatened. You know, that's sort of what the picture that I have in my mind. And that's kind of the thing. But but a response is something I have prepared this you know, I have been prepared to respond to whatever situation comes my way. And that's a really important thing. You know, when you're talking about your money and you're talking about, as we've seen these past couple of years and this year, especially the way the markets have been behaving, the way that the economy has seen inflation like we haven't seen in 40 years, it's so important to be prepared for the things that you don't want to come. You've got to be prepared for those things because, you know, it's like those things are the things that can really just, just just tear your your financial life apart. If you let them. Just don't let them.

Mike Zaino:
Don't let them in. The way you don't let them is by having a plan. I learned in the military the seven P's proper prior planning prevents pitifully poor performance. If you don't want pitifully poor performance, then you have to have a plan in place. You have to be willing to take action. You have to be willing to take the first step and to not give up on your action plan. And if that is you again, you know how to get in contact with me, whether it's by phone or on the website.

Producer:
Yes. And the website is Money Matters with Mike dot com, MoneyMattersWithMike.com The phone number 704 560 1573. And I got to say, Mike, that those P's definitely a lot more useful to folks than Peter Piper picked a pack of pickled peppers that's that one. You know, if you like pickled peppers, I guess you're good. Anyway. All right, so moving along here, you know, we talked about this and these numbers still are surprising to me because that like just about a third of U.S. adults saying that they regularly run out of money between pay periods that we just talked about. That means those folks have an income gap. Right? They don't have enough money to get them through each and every month.

Mike Zaino:
more month than money. Yeah, that's not an enviable position to be in.

Producer:
Exactly. Exactly. And so and so that's where where we're going with this is is how to eliminate that income gap. Right. And this is sort of where we are. You know, we started off the show talking about are you going to plan for the new year? This is part of that discussion, getting you set up for 2023 so that you can in the next year, eliminate that income gap. Walk us through this, Mike.

Mike Zaino:
So retiring during a down market is a challenging but not impossible task. And we want to help make sure that you don't have an income gap during that very, very important time. First step is you need to determine your expenses that you're going to have in retirement. And so what you'll do is you'll subtract your expected income from your expenses, and that will give you either a gap or it's going to give you a surplus If your expenses are less than what your total income sources amount to. And we want to make sure that everybody has a surplus and not a gap so that you can enjoy the life that you work so hard to build and so smart. Reinvest for successful retirement is paramount.

Producer:
Yeah, absolutely. You know, you have that excess of funds in your retirement. You can take some of that money and then reinvest it. And then have, you know, even more growth in your financial portfolio. Your financial situation looks even brighter and even rosier as you go on through. So, yeah, that's a that's an important one. So what's number two here? My.

Mike Zaino:
Number two would be to build a plan that is going to pay you income even during a bad market. We talk all the time about how it's not. Retirement is not just about having a big number, whether it's $1,000,000, $5 million, whatever your number is. But in fact, it's about cash flow and how much income you have versus your expenses that are going out. So if you have bonds in your portfolio that have just been tanking this year, bonds are down up 15%. In some instances, you can replace those with fixed indexed annuities to do a couple of things. Number one, eliminate fees altogether. There are zero fees in the ideas that we utilize with highly rated multibillion dollar companies who've been doing this sort of thing since before most of our listeners were in diapers. Right. And number two, you can guarantee yourself an income that you can never outlive. Call it a personal pension, if you will, regardless of how future markets may react or respond. It doesn't matter what the markets do. Your money is your money is your money. Your paycheck will continue to pay you for the rest of your life. And then that allows you to prioritize income over assets for a much, much more secure retirement.

Producer:
That's absolutely right. And that's the thing is. Yeah, don't don't focus on that one big number. You got to know what you want your lifestyle to be in retirement and then know what kind of income you're going to need to have to make that a reality. That's really what it's all about. All right. So number three here, Mike.

Mike Zaino:
Number three is that you need to understand that you're going to need your money to last 30 or more years in retirement. Think about that. People are living longer. In fact, if you're a married couple and you're 65 years old each, there's a 50% chance that one or the other of you is going to live into your nineties and the fastest growing segment of the population. Guess what that is? It's centenarians, people that are turning 100 years old. So you retire at 60 or 62 or 65, you've still got 40 years up to that you need to plan for. And the single biggest fear is running out of money. So recognize that we are all living longer and that's why we provide all of our listeners with a complimentary financial plan from now, all the way through their 100th birthday.

Producer:
Yeah, and, you know, even beyond because as you say, a lot of people are living to be at least a hundred. And so and that number keeps on growing. So yeah, absolutely right. And a good, good point to make there. Longevity is a thing and you want to make sure you plan for it. Now, of course, if you want to get started on that road with a financial plan, that that would be customized for you. I mean, this is not a one size fits all thing here. These you know, Mike just doesn't he's not sitting at his desk with like a drawer full of the same financial plan for everybody because everybody's situation is different. Right? So you want to get that free, full retirement plan, consultation, and you can go to money matters with Mike dot com MoneyMattersWithMike.com. To do that. Or you can call the number at 704 560 1573. That's 704 560 1573. What happens when they do that?

Mike Zaino:
So the first thing we're going to do is we're going to talk on the phone just like humans, right? We're going to have a candid conversation. We call that our discovery call. It's about a 15 minute call. And you're going to figure out whether or not what I've said piques your interest enough to where you say, you know what, I want to sit down with this guy. He seems to know what he's talking about when we come into the full comprehensive consultation. Of course, that's at no cost to our listeners and there's absolutely no obligation. You're only going to work with me if I can do better for you. All right, So I'm going to help you analyze your specific and unique financial situation. I'll help you discover exactly how much you are paying in those fees that we talked about that can eat up to 200,000 of your account value over your lifetime. I'll help you cut out unnecessary costs in your IRAs, your 401. Case, or any other type of retirement savings account. If you have annuities, I'll take a look and examine any of those that you might currently have and see if we can do better.

Mike Zaino:
And then I'll also help you with Social Security planning and Medicare planning, if that's what you need help with. Bottom line is, if you feel like you have already learned something today, please give me a call. I would love to help answer your questions about your individual, specific and unique situation. Again, that number is 704 560 1573. Or you can check us out on the web at money matters with mike dot com. MoneyMattersWithMike.com And you know what? Do me a favor go to our YouTube channel and search Money Matters with Mike on YouTube. We put out little two-minute to five-minute snippets of The show if you don't have an entire hour to listen. Those are typically our meat on the bone segments. And we're in a in a push for subscribers Now, we just started the channel just started those meat on the bone segments. So again, go to YouTube Search Money Matters with Mike. Give us a like give us a subscribe and make sure that you're passing out that information to anybody else that you know who could also use the info.

Producer:
It's time for this week's problem solver.

Producer:
Yes. As you can tell by our very dramatic introduction, which I am very proud of. It's time for our problem solver here. And so we're going to walk you through this. I'm going to present a problem that actually is a real life, one that we recently encountered here. And Mike Zaino is going to and I actually love this one because you're going to present a solution, which is a very good one, because I, I feel for this couple, right? This is a couple that we recently worked with, older couple, ages 80 and 83. In the middle of their retirement, they they started to develop a fear of spending their money. And you can you can understand why. Right. Recently we've been talking about it with inflation and all of that and the market volatility and everything. They were absolutely afraid of spending their money. So upon inspection, they were a couple of things. One, overinvested in bonds. They had lost a quarter of their portfolio, 25% of their portfolio since the start of this year, the start of 2022. And they didn't know that they could update their annuity at all. So so talk about the solution for this particular couple, Mike.

Mike Zaino:
So, yeah, this was this was a couple who was in dire straits when they came to us. They were very afraid to even spend ten bucks by by buying this or that. And that's a scary thing to. Scary situation to be in in retirement. The whole goal when you get to retirement is to not be afraid of spending the money that you've earmarked for retirement, specifically for enjoying the rest of your life. So what we did with this couple was an annuity x ray, and we were able to show them all of their options for upgrading to a more suitable annuity for them. And so when we selected the best option, what it did for them was nearly doubled their annual income payout. They were receiving $32,000 a year. And just by identifying a better option for them, we were able to almost double that. Not quite all right. But they instead of 32,000, they were getting now $61,000 a year. So that was a huge increase to their income and gave them the confidence knowing they no longer had to worry about spending ten bucks. Also, we were able to eliminate the fees on that portion of their portfolio.

Mike Zaino:
Why? Because the fixed indexed annuity that we put them in had a zero fee income rider and that income that they could start using right away and was guaranteed for the rest of their life no matter how long they lived. And so for a couple in their eighties, this is a huge deal and we are so happy to have been able to help that family. And so if any of that resonated with you, we can help you take a look at income options for your retirement. And again, you just have to give me a call. Mike Zino at 704 560 1573. Or by going to money matters with Mike dot com MoneyMatterswithMike.com And filling out a contact us request form we find that way too many couples in retirement have a fear of spending their hard-earned money and investors in annuities haven't lost a single penny during the financial crisis of 2008. They didn't have it lost a penny in in COVID. They didn't lose a penny so far this year, even though the stock market is down over 20%. So far, so.

Producer:
Huge, huge, huge.

Mike Zaino:
Boost to their retirement confidence from an income standpoint and from a fee standpoint.

Producer:
Come on down as we test your financial knowledge in right or wrong.

Producer:
Yes. We like to play a little game called Right or Wrong. I present Mike Zaino with a statement and he tells me if it is right or wrong and gets to see how much attention I've been paying as the show has gone along here. And spoiler alert, probably not too well today given the statements that I am going to say. So here we go. No, I do pay attention all the time to to everything here, But this is all part of the game, folks, in right or wrong. So here we go. Number one statement. In right or wrong, there will be no changes in the tax brackets from 2022 to 2023. Right or wrong, Mike?

Mike Zaino:
Matt, You know the answer to that. That's wrong. There are seven brackets within the IRS tax code, the 10%, the 12%, the 22%, 24%, 32%, 35% and 37%. While those brackets have the exact same percentages, the income thresholds within the brackets have changed due to inflation. So it's important to have a tax plan during your retirement years, which is why we encourage all of our listeners and existing clients to have an annual financial checkup to ensure that you're on the right track as far as meeting your goals and saving as much of your hard earned dollars as possible.

Producer:
Yeah, very, very important there. And yes, I do. I know the tax brackets are changing, or at least the income thresholds are. So there we go. I was paying attention. I promised. I just have to you know, it's all part of the game here. All right. So number two, this is second statement. In right or wrong, the only ways to reduce your taxable income and get into a lower tax bracket are deducting your mortgage interest and taking advantage of tax credits. The only two ways. So is that right or wrong, Mike?

Mike Zaino:
Well, typically when you use absolute terms, you're always going to be wrong. Right. So. So. And notice what I did there. You're always going to be wrong. That's an absolute term. Anyone can reduce their taxable income during retirement by taking tax free withdrawals from the only two types of tax free investments, which are Roth IRAs and life insurance. So if you are interested in generating a tax free income bucket during your retirement, then I would absolutely encourage you to schedule a free consultation with me today. It will cost you nothing to find out how much you could save on future taxes.

Producer:
Yeah, that's very, very important to people. Not only, you know, those new income thresholds and the tax brackets themselves could save folks some money just by them potentially doing nothing. But then this is something that you really have to take action on. So, you know, the difference between different types of accounts and different types of vehicles that you can use to save for retirement and, you know, grow that money and then get it later on tax free. It's actually a lot to go into. So yeah, absolutely. Get in touch with Mike zero for that free consultation. Okay. So number three, in right or wrong, I got two of them wrong so far. So let's see if two wrongs make a right here, huh? All right. So the last one, Medicare pays for long term care needs. Is that one right or wrong, Mike?

Mike Zaino:
Oh, my word, Matt. No, that is wrong. Again, Medicare does not pay for long term care needs for people who cannot perform everyday activities on their own. And this is why we want everyone to have a smart health plan in order to have a successful retirement along the way. Health care expenses are extremely costly, and guess what? They're on the rise too. So now is a great time to review both your Medicare and any long term care insurance needs that you have or that you think you might have or if anybody in your family has ever had to have in home health care going into an assisted living facility or nursing home, then there's a good chance or probability that you're going to need that type of care as well. And planning for it in advance is much better than having to again react to a catastrophic event.

Producer:
Yeah, the response versus the reaction, as we've said. And yeah, you know, we actually looked at this a few weeks back on the show when we talked about long term care during our, you know, a Smart retirement plan series and talked about smart care plan, you know, just the numbers. And I don't have them off the top of my head. But, you know, it's thousands and thousands and thousands a year even, you know, multiple thousand dollars per month in many cases for, you know, comprehensive nursing home care and even, you know, like an assisted living sort of situation. It is not cheap at all. And so you've got to have a plan for that. You know, there's there's long term care insurance, as you say. There are other ways to be able to to save for that so that you have an income that is going to be able to cover that in the event that it happens in your retirement years. But you just have to be prepared. You know, it's you don't you don't know what you don't know and you're not prepared for what you're not prepared for this.

Mike Zaino:
This is true. Another way to look at it is without a plan, plan to fail. I mean, I don't know how to be more blunt. I mean, I hope that is not your situation, but if you go into the later years of retirement and you don't have a plan and something absolutely catastrophically happens to you, and your family can no longer meet those needs and feel obligated to put you into a facility that can. Well, if you don't have a plan, then guess what? You're relying on a government run institution. And if you have the opportunity to put a plan in place to maybe give you some choices and some better options, I know that most people would rather choose for themselves and allow themselves the freedom and ability to have better options than the state run facilities. My grandfather, unfortunately had to be placed in one of those, and I swore at that point in time that that would never happen to me.

Producer:
Yeah, and I can absolutely understand why. So plan for your future folks and plan for the things that you might not see coming. You know, plan for the unexpected.

Producer:
Here's the cost cutter of the week.

Producer:
So we've been talking about Medicare here, Mike, and that's what our cost cutter deals with this week. Talk about that with our listeners and how you can cut costs regarding your Medicare expenses.

Mike Zaino:
Yeah. So Medicare changes from year to year. Certain doctors quit taking certain plans, certain plans quit covering certain drugs. And so the reality is, is if you're not checking and moving your Medicare plans every, say, 2 to 3 years, you should definitely check it every year. But move it on on every 2 to 3 year basis. You could be losing money. And by re-evaluating each of your options each and every year, you're going to likely find that you can save money on those expenses from Medicare. And so some people do a medicare coverage check each and every year, like I said, just in case they have the opportunity to save some extra cash. And so, again, if you're not checking your Medicare, if you haven't checked your Medicare in a while, please do it this year because it's open season right now and you have the ability to move and perhaps save some money.

Producer:
I don't know why. I just thought of the old Bugs Bunny cartoon. Whereas Rabbit season, duck season Wabbit, you know, and they're pointing the gun back and forth at each other. I'm like, No, it's Medicare season, for crying out loud. And it is until December 7th is the annual enrollment period in Medicare. I just I don't know. I love Looney Tunes. What can I say that says I don't know what that says about me, that that was the thing that popped in my mind. I'm just kind of a dork.

Mike Zaino:
I was a looney tune kid as well.

Producer:
So many of us were. Oh, my goodness. Such, such. Good, good. Stuff there. Well, just about to come to the end of our time together. But I wanted to to mention once again, folks, if you feel like you have learned anything or if you're if your curiosity has been has been piqued by our discussions today about planning for retirement, about saving for the future, about, you know, putting some money to the side to save up for, you know, something like, you know, your long term care needs in the future, putting that money, hard earned money that you have earned to work for you in your retirement. Any of that, if any of that sounds good to you, go to the website Money Matters with Mike dot com. MoneyMattersWithMike.com It's Money Matters with Mike dot com or give Mike Zaino a call at 704 560 1573. Once again 704 560 1573. Well, Mike, I have enjoyed it again this week. I appreciate you, sir, as always. And we'll talk again next time.

Mike Zaino:
Well, you are the co-host and producer extraordinaire, so thank you for your contributions to the show. Without you, the show doesn't doesn't carry exactly the same punch without our listeners out there, you know, this show doesn't exist. So thank each and every single one of you. If you know anybody that can benefit again, share Cher share. Thank you again so much from the bottom of my heart. Make it a great day today and have a great rest of your week.

Producer:
Thanks for listening to Money Matters with Mike. You deserve to work with a financial and insurance expert who can offer strategies for protecting and growing your hard-earned money. To schedule your free no obligation consultation visit Money Matters with Mike dot com MoneyMattersWithMike.com Or pick up the phone and call 704 560 1573 that's 704 560 1573. Not affiliated with the United States government, Mike Zaino 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. It does not provide a guarantee or a specific result. All copyrights and trademarks are the property of their respective owners. Amerilife 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 are the results obtained from the use of this information.

Producer:
Are you concerned about market volatility, rising taxes, economic uncertainty, and how it all could affect your future in retirement? Tune in to Money Matters with Mike to learn how you can protect and grow your hard earned money. Money Matters with Mike every Saturday at noon right here on FM 100.1 and AM 1340. Protect your hard-earned money today and schedule a free no-obligation consultation now at Money Matters with Mike dot com. MoneyMattersWithMike.com.

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