Don’t Fear the Election Year!

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

Producer:
Fixed annuities, including multiyear guaranteed rate annuities, are not designed for short terme investments and may be subject to restrictions, fees and surrender charges as described in the annuity contract. Guarantees are backed by the financial strength and claims paying ability of the issuer.

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 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 is a show designed to arm you with information and give you plenty of meat on the bone to chew on each and every single week. And today we are absolutely bringing the heat again. On today's show, we're going to give you our retirement planning playbook and discuss some strategies to help you win more with your money in 2024. The whole goal is more in 24, and 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 are you doing today, buddy? Hey, Mike.

Producer:
I'm doing great, sir. I, uh, you know, it's been like, soggy and dreary and stuff around here lately, but other than that, I'm. I'm staying afloat.

Mike Zaino:
You know, I think this is an El Nino year, so, uh, we have definitely been getting our share of rain here in the southeastern United States. And, you know, I know in the biblical times, God told Noah to prepare an ark. And so, uh, I'm not sure that we're quite to that level of saturation. But you know what? Uh, we're we're getting rained on a lot.

Producer:
We really are. It's raining on our parade here, but, uh. Yeah. Build your financial ark so that you can stay afloat no matter what that's going to be. Yes, sir. The message today. Um, but, yeah. No. A lot of great stuff to get to, though. This, uh, week. You know, all of the headlines, uh, have been filled with election news because it is, of course, an election year. And that leads to a lot of uncertainty among, uh, people in, in the public. Okay. What's the future going to hold? Um, what are the policies going to be coming out of Washington? How's that going to affect me? We've got actually some election year myths with regard to how financial markets perform that we will debunk today and tell you how you can prepare for the election year and beyond, because it really is about the long terme when you're talking about financial planning anyway. Right? So, uh, we got that. We've got some steps to prepare for retirement if you are 50 or older. More specifically, we'll also talk about multiple income streams during retirement. One's not going to cut it. And we'll tell you why, uh, in just a little bit. And also want to encourage folks, Mike, to, to go to the website Money Matters with Mike comm. Uh, or go anywhere you listen to podcasts, Apple Podcasts, Spotify, uh, all the all the places and, um, subscribe to the podcast. Give us a like leave us a review there. Tell us how much you love us. If you don't like us, uh, then don't leave us a review. But if you love us, leave us all the great reviews. And, uh, that would really, really help this show grow. And we appreciate each and every time a listener does that. Right.

Mike Zaino:
The. Absolutely. In fact, if you want us to discuss anything that maybe we haven't in a long time, then shoot us a message on Facebook. I'll absolutely love corresponding with our listeners on the Facebook. And so again, if you have anything you want us to discuss, then just shoot us a message there. And we have some great conversation and some great input from other folks, uh, on, on Facebook as well. So, you know, there's lots of ways to find money matters with Mike. And if you can't find us, uh, you're not looking.

Producer:
So that's very true. And one of the other ways, by the way, is, uh, by giving Mike a call Producer: (704) 560-1573

Mike Zaino:
And, folks, that is my personal cell phone number. Okay? I want everybody to know that millions of people have my personal cell phone number. It is the only telephone number that I've had since 1997. So you have no excuse for picking up a phone and giving me a call if I am not meeting with a client on a date night with my wife or daughters or otherwise engaged, I'm going to take your call. And even if I am any of those aforementioned things, I will get back with you as soon as I'm able. So please pick up the phone and give me a call. And that number.

Producer:
Once again is (704) 560-1573. All right let's let's start diving right in here. Mike, before we get to the main meat of our show, uh, for folks to chew on here, uh, we're going to start things off with a little inspiration for our conversations today in the form of our quote of the week.

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

Producer:
And this time around, the quote comes from a guy you might have heard of who might have, you know, done, done a thing or two in his life Thomas Edison. Uh, you know, the, the inventor of, say things like the light bulb and and stuff like that. Um, he said this one time, quote, good fortune is what happens when opportunity meets with planning. Boy, that's that's good.

Mike Zaino:
Yeah, I mean, it is. I've heard it paraphrased in that luck occurs when preparation meets opportunity, but it's it means the exact same thing. And I think it reflects the idea that success or good fortune is not merely a matter of luck, but rather a result of a combination of both. Opportunity come along with careful planning.

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

Mike Zaino:
So, you know, it was funny, I was. It's playoffs time now in the National Football League and I've been watching the games. I don't really have a dog in the fight, but I am rooting for some of the underdogs like the Detroit Lions. I'm happy to see them in the playoffs for the first time in like three decades. Um, but you know, I'm watching and anytime like a starting defensive back, like a cornerback gets injured and they have to put the backup. It always seems like the team that's on offense goes right after the new guy in the game. And and I think that's a perfect illustration of when preparation meets with that opportunity. So Edison was emphasizing the importance of being prepared and having a plan in place to make the most of those opportunities when they arise. Okay. And this constant context, rather success is not solely dependent on chance, but does require proactive preparation combined with strategic thinking. And the quote encourages individuals to be ready to seize the opportunity by having that well thought out plan and being prepared to act. And so, you know, we're going to talk about different ways today that you can have a well thought out plan and make sure that you are prepared to act when the opportunities arise.

Producer:
Yeah. And and it really is. You know, another way I kind of wrap my head around the quote too is, um, you know, opportunity meeting with not only planning but also work, you know, because it's, it's, you know, you got to put in the work to, to plan. But um, and obviously preparation is, is key in any situation as, as much as humanly possible. Um, but yet you got to gotta, you know, spend some, some elbow grease and do some work, uh, in order to have that success.

Mike Zaino:
Yeah. That opportunity is often dressed in overalls and looks like hard work. Right? I've heard that one before as well.

Producer:
This is this is very true. Uh, and, uh, yeah. So, you know, get to work and make success for yourself. It's like, you know, don't this is why we all go to work every day, and we don't just wake up, go buy a lottery ticket and go back to bed. You know, the kind of the same thing.

Mike Zaino:
It is so true. And and success really is a choice. In fact, that was a book written by Rick Pitino, who used to coach the, uh, Kentucky Wildcats, uh, to multiple national championships. Um, you know, he wrote a book called success is a choice. And, and I got so much out of that book. So if, if, if our listenership hasn't read it, go check that one out, because it really is a great, great read. Yeah.

Producer:
Uh, great recommendation there for all of our listeners. Of course, another great recommendation is to go online at Money Matters with mike.com. Money matters with Mike comm. All one word. And, uh, you can get in touch with Mike for a free consultation and we'll give you more information on that as we go along throughout the show. But also, um, some opportunities for you to, uh, take home, uh, another book, maybe, for example, annuity 360, written by our good friend Ford Stokes. That's a free ebook that you can get by reaching out and contacting Mike as well. A lot of great information there about retirement planning and some some avenues for planning your retirement that you might not have considered. So as I mentioned at the top of the show here, Mike, it is an election year. Obviously, you can't can't escape that fact. If you, uh, you know, open up your phone, turn on the TV or turn on the radio when you're in the car, that kind of thing. Uh, election news is everywhere. And that can, of course, in people's minds at least, lead to some uncertainty, a little bit of fear or trepidation about what the future might hold. Um, talk about, if you will, the the fact that it's an election year. How could that relate to all of us, financially speaking?

Mike Zaino:
You know, I guess the biggest thing is people don't really like change. And no matter who your leading candidate is, there's always the possibility that that person might get swapped out for the next person. Right. And so it amazes me every election cycle how many phone calls that I. Receive of people just literally freaking out. Okay. And so, you know, a few things to keep in mind this year is that you should definitely consult with a licensed financial professional to make sure that you're properly allocated and that your dollars are protected, but in an environment that they can still continue to grow, especially during those difficult market conditions. Okay, do not be attempted. Uh, or excuse me, tempted, I should say, to make those emotional sudden change decisions with your money. Okay. There are so many people that I see that just convert to cash, um, immediately. And and that could result in what we call a melting ice cube scenario whereby your money does is melting, it's losing its purchasing power and is not able to keep up with inflation. And so now is not the time to put your hard earned and hard saved money under the mattress. Okay, so you know, a licensed financial professional is just going to help reduce the volatility in your portfolio. And so don't just hang in there with your investments. That would be the absolute biggest advice that I could give folks out there listening.

Producer:
Yeah. And that it is a great advice actually because two things really that stood out to me there. If you put your money under the mattress, it's not doing anything except maybe getting a good night's sleep. And you you want to be the one getting a good night's sleep, not your money. So do something else with it.

Mike Zaino:
I had I had a guy call me, you know, a couple months ago was right before the holidays, and he was freaking out and and he told me he had $300,000 in his closet. And I'm thinking to myself, oh my gosh, dude, what happens if your house burns down? You know what happens if someone breaks into your house? Uh, I mean, you have so much, they're literally at risk. Even though he thought it was safe. And so we convinced him to move some money into some different vehicles and and made sure that he was still protected yet not exposed.

Producer:
Yeah. And that that is really the goal there is to, to, you know, have that measure of protection for your money because you've, you've worked hard for it. Um, but you also want to put it to work for you. And that's the other part of this too, is, you know, don't just hang in there, set it and forget it is not a strategy. If you want to, you know, make headway against inflation and all the other factors that can affect what you have to spend.

Mike Zaino:
Right? So money needs to circulate okay. And so money is called currency right. The root word current means in motion. And so if you if you just have your money stagnant think of a stagnant body of water. Um, a stagnant body of water typically breeds bacteria and disease. So you don't want your money growing bacteria and getting diseased and not able to keep up with the rising cost of living. So make sure that your money think of it like soldiers, and you're putting those soldiers to work for you in the war toward inflation. And hopefully they're fighting uphill and are gaining ground. So that's the way I like to think of my money. When I put it out, uh, I'm like, go back, go out and conquer. Bring me back some more.

Producer:
That's right. And hey, put your soldiers to work by giving Mike a call at (704) 560-1573. He can walk you through exactly how to do that. Um, and, uh, you know, get to know you as well as part of the free consultation, uh, that he's offering, uh, to listeners of the show here, 704 5601573 or of course, the website Money Matters with mike.com. All right. So I mentioned earlier too, we've got some election year myths to debunk here. So I'm going to I'm going to give each of these myths to the listeners here, Mike. And I'm going to let you because you are our fact checker extraordinaire. Uh, when it comes to all things money here. So you, uh, can do the debunking for us. So here is myth number one. This myth says that stocks don't do well in election years.

Mike Zaino:
Yeah, um, that's not true. I mean, the reality is, if we look back through all the election years, returns in election, and Non-election years usually aren't at all that different. In fact, we looked at how the S&P 500 fared in both instances, going all the way back to 1928, which is as long as we have data and stocks returned 7.5% on average during election years, compared with 8% on average during Non-election years, it's slightly weaker, but it's still solid.

Producer:
Yeah, and definitely not any kind of doomsday scenario that people might think, uh, of, you know, when they say, oh, you know, it's election year. I can't do anything in the markets here. Um, number two, the number two myth about election years is that markets will crash if a particular candidate wins.

Mike Zaino:
Mhm. Okay. Well, reality is that we have seen both booms and busts on both sides of the aisle. So both of a Democratic candidate wins. We've seen gains and losses. If a Republican candidate wins, guess what, folks? We've seen gains and losses. And so while stocks tend to rally in those aftermaths of the election, it is true that some election years have seen bigger swings than others, but those instances have tended to do more with the underlying macroeconomic backdrop than the election itself.

Producer:
Yeah, the underpinnings of the economy and all that's going on in the world, all of that tends to matter a lot more. And then myth number three, the Federal Reserve does not change policy in election years.

Mike Zaino:
Uh, that's a joke. Okay. The reality is the fed hasn't shied away from hiking or cutting rates during election years. And again, going back to the 1950s, 2012 has been the only election year that the fed didn't do anything. They didn't raise or lower interest rates. That was one time going all the way back to the 1950s. So similar to myth number two, this suggests that the economy itself, rather than politics, is actually the one in the driver's seat when it comes to monetary policy. And we believe that this year won't be any different.

Producer:
Yeah. And that is, uh, good news there that, you know, it's going to be a year of change, certainly. But there are things that we can kind of count on going ahead and that, you know, some of these myths here, definitely not true at all. So with all of that being said, and there's still, you know, uncertainty, at least mentally for people, I feel like going into the remainder of 2024 and as election season heats up and all of that, uh, going into the fall, certainly, how can people plan for the year ahead?

Mike Zaino:
I think the real point is, is that, you know, just make sure that you're not looking at what right, what's right in front of your face. And while politics can evoke very, very strong emotions, we don't think that anybody should lose sight of their long terme investment goals. In fact, we believe that the economy will remain the predominant driver of all of those policy decisions, as well as the broad markets across the globe. And, of course, you know, there are risks, whether that's ongoing friction points such as inflation to wild cards like geopolitics. But we do believe that as growth holds up, uh, price pressures abate and the fed embarks on an easing path. When they start cutting interest rates, there is ample opportunity for multi-asset investors in the years ahead.

Producer:
Yeah. And something that we're going to talk about as well is, um, coming up in just a few minutes on the show, not, um, the multi-asset investing, but multi, uh, streams of income, multiple streams of income. So, you know, we often think about diversification as diversifying your investments, kind of like you were just talking about but also want to diversify those streams of income. So we'll get to that conversation in just a bit. But yeah I mean that's it's so it's super important to give yourself some um, some headroom, some time to plan and don't, as you say Mike, invest with emotion. That is kind of the worst thing you could do, right?

Mike Zaino:
I mean, if our if our theme is more in 24, guess what? It's time to get serious in 2024, especially about your long terme financial goals. This is an election year, and there's already so much uncertainty in the world affecting retirees as well as pre-retirees. Please don't wait until you're ready to retire in order to start retirement planning, okay? The more time you give yourself to plan, to accumulate, to invest, guess what? You're increasing the likelihood that your retirement will be financially successful. So let us help you get started. Uh. Don't delay. Give us a call today. Okay. 704 5601573 or head on to the website Money matters with mike.com. That's Money Matters with Mike all spelled out.com. And click on the free consultation uh tab and book your appointment that way.

Producer:
Very easy to do and a couple of different ways you can do it as Mike just told you there. All right. So for listeners who might be tuning in to the show today, Mike, who are 50 and older, which is kind of, you know, the target. Uh, yeah. He's if you're if you're not you're not watching the video version, folks. Mike is waving his hands. Um, but, uh, yeah, if you are 50 or older and listening to the show today here, listen up, because we actually have three, um, kind of, you know, I'm not going to say necessarily easy steps, but three kind of basic things that you need to be doing in order to prepare for retirement. Three things to get you down that road and have you better prepared when the time comes to to, you know, hang, hang it up and, uh, ride off into the sunset for your golden years. Uh, number one is to find and examine your company's 401 K plan document or documents, um, and that, you know, it might seem like, um, not the most interesting reading in the world, but very important for you to do, because it could wind up being pretty interesting when you realize what all is in there.

Mike Zaino:
Yeah. You know, it's it's funny that that we're doing that because just this morning, um, I was reviewing my wife's, uh, 401 K. Uh, actually, she has a 403 b um, but her employer sponsored plan, and I was, I was, you know, just reviewing some things and looking at where she's invested and just kind of identifying different things. So you out there listening, the first thing you need to know is what your account number is, what who your plan administrator is. And all of this should be listed on your documents. And then obvious you want to know your vested balance. And so one of the things if you're a newer employer, you might not be fully vested in your account funds. If your employer offers any type of matching to your contributions. Plus, you know, you should be aware that eventually, if you're in a traditional employer sponsored plan, uh, whether it's a 401 K, a 403 B, A 457 a Sep. If you're self-employed, a thrift savings plan, if you're a federal employee, um, guess what? You haven't paid taxes on that money. You've deferred those taxes. So eventually, once you start taking withdrawals and distributions, Uncle Sam is going to come knocking and want his cut of your money.

Mike Zaino:
So, um, you know, another thing you can do is take advantage of what we call our free 400 and 1KX ray. And so we can show you exactly how your. Portfolio is really performing as compared to a normal benchmark, say the S&P 500, and how it's projected to perform as well in the future. And a lot of folks have zero idea, like they have no clue what they're invested in, namely bonds. And you may have an overweighted, um, allocation in bonds. We're going to show you exactly what percentage of your portfolio is weighted in bonds. We'll also show you how much you're paying in fees. And so if you need any assistance whatsoever confirming whether or not your employer sponsored plan, again, 401 K, 403 b TSP and all the other ones might have any special provisions around retirement withdrawals. You want to make sure that you're compliant with all of the plans rules to avoid any very, very costly errors. So just give us a call. We're happy to do that for you.

Producer:
And that number is 704 5601573704560 1573. You can also go online to Money Matters with Mic.com. Step number two here for everybody 50 and older really. You know it's it's good advice for anybody uh quite frankly but especially those 50 and older. Check your Social Security benefit projection. And this is a lot easier to do I think, than people might realize. Mike.

Mike Zaino:
Yeah. So a long time ago, the Social Security Administration used to send the documents to everybody. Every year. You'd kind of get a barometer of where you were. And so, you know, I thought it was easier back then, but then they quit killing trees and moved everything online. And so there are people out there that just are like, you know what? I'm really not that technically savvy. And guess what, folks? I finished college the year before the internet was invented myself, so I also lump myself into that. Hey, I'm not, you know, as technically advanced as maybe people who are growing up, you know, with a tablet in their hands or a device in their hands. But I also kind of changed my way of thinking. It is actually very, very simple to go in and create your free account with the Social Security Administration. You just literally log on to ssa.gov, click on the My Social Security and then create an account. Okay that's how simple it is. And so having a sense of what you are going to receive as far as Social Security income in the future can help you figure out how much you're going to need to have saved, in addition to Social Security by the time that you retire. It will also help you identify any years where they might have had faulty reporting. Guess what, folks? When they switched over from paper to online and I created my account, I identified many years where they just had zero income, reported zero, and I'm like, um, that's not the case.

Mike Zaino:
I made money during those years. I paid into Social Security, so all I had to do was recover my, uh, tax returns for those years, provide them with the documentation, and I got that corrected. But you definitely want to make sure you know how much you're going to get, because, for instance, if you find out that you're going to receive around $30,000 per year in Social Security benefits, but your expenses are around $80,000 a year, you need to know how you're going to come up with that other $50,000 worth of income in retirement in order to cover that budget, and for you not to experience a, you know, lifestyle decline in retirement. So, you know, an additional income streams obviously can come from personal savings. They can come from investment income, they can come from part time work or even from personal pension plans like fixed indexed annuities that we've discussed a lot on our show. And so knowing what your numbers are looking like, your net numbers, that's just going to help make retirement income planning a bit more clear. Right. The clarity is amazing. And so the beauty of checking your Social Security accounts early is that you have more time to improve your Social Security payout by earning more in the coming years.

Producer:
Yeah. And you know, it all boils down, really, Mike, to what is included here as step number three in our list of three steps to take for people 50 and older. But again, as I say, it's really good for anybody is to have a smart vision for your retirement future and that, you know, if you don't even have a plan. I guess the kind of like the old saying, if you fail to plan, you plan to fail. Well, that really is the case, especially when it comes to retirement. You don't want to be playing around with this. It's something that as early as possible, you want to get that plan in place so that you are prepared when the time comes.

Mike Zaino:
It is. And I mean, I remember when I was in my 20s, I thought I was going to be driving a Ferrari and sailing around in yachts. And you know what? That still may come, but my priorities change as I progress. Through my 30s and my 40s and had children, and those children are now grown. Um, you know, things change in your life. Well, guess what? Even if you're only able to put together a rough sketch of how you think things might end up and be for you in retirement, putting your vision down on paper or speaking with a financial professional is a very, very great place to start. So some things that you might want to ask yourself is, you know, who am I going to be spending my retirement with? Is do I want to spend time with my spouse if I'm married? Hopefully the answer is yes. In that case, you know, if I have extended family, do I want to be able to visit them no matter where in the world they might live? Do I want to, you know, spend time and have money to take my grandkids to the ball game, to the movies, to do this or do that? Do I want to go out and travel with friends? You know, all these different things about how you're going to spend your time? Well, then, okay, that's time.

Mike Zaino:
But what do you want to do with that time? Are you going to travel? Do you have hobbies that that cost money, like maybe tennis and golf and skiing? Um, do you want to start a business? You know, where do you want to live? In retirement? Do you want to stay where you are right now? Do you want to move to the coast to warmer weather, whether that's, you know, Florida or out west? Uh, do you want a mountain house? You know, all these things that, you know, people just don't really think about. And and I think another one is, when do you want to retire? Some people just want to retire because they hit age 60. Um, I don't think I'm going to be ready to retire age 60. I actually love what I do because I help folks. But, you know, finally, how are you going to fund that vision? How are you planning to pay for all that? So I have people that say, all right, Mike, I want to travel. And so my first question is, well, how do you want to travel and where do you want to travel? Are you going to pull your pickup or your camper with your pickup truck and go to national parks? Or are you flying first class or business class on Emirates or Virgin and staying at the Ritz Carlton in the Four Seasons? Both of those are traveling, but each of those requires a different level of capital, right.

Mike Zaino:
So how are you going to fund that vision? I think answering those questions gives everybody a great start. Yet I am blown away with people who are literally retiring, and I'm work helping them work through their retirement paperwork, which is something that I help folks with. And I ask these questions and they haven't given any thought to it. And I'm like, well, look, you probably shouldn't retire if you don't at least know how you're going to spend your time. Because what I have seen in my experience of, you know, 15 plus years of doing this for folks is that the people who retire without a plan for how they're going to spend their time the first month, it's like vacation and they're like sleeping in, they're yawning, they're having their afternoon naps, and they're drinking their afternoon cups of coffee so that they can stay up real late at night. Um, it's literally a vacation for them. But after a month or so, they start, you know, twiddling their thumbs. They start becoming restless. And then it's like, all right, now what? So make sure you have a plan.

Producer:
Yeah. That's so, so important. And folks, you know, if you're in that boat, if you have not, you know, given much thought to what you're going to do in retirement other than, you know that for that first month kind of do the whole being lazy around the house thing, um, give Mike a call because, you know, in, in that, um, full retirement plan consultation, that's some of the stuff that you'll discuss. What does your retirement look like to you? And if you haven't given it a lot of thought, talk it through with Mike. You can go to Money Matters with mike.com. You can call 704 5601573. And might talk a little bit about what that free consultation looks like to our listeners.

Mike Zaino:
Yeah. So not only is it free that means zero cost right. There's also no obligation. We're only going to work with each other if it makes sense. And I can put you in a better situation. But you know, we're going to take a deep dive into your current financial situation and examine all of your stuff. Okay. So you may have IRAs, you may have 401 KS, you may have, uh, annuities. And we're going to look at all of that and see. All right. How much are you paying in fees. Um, what is your expense ratio. You know what what are your goals and objectives and how you plan to use that money to accomplish those future goals and objectives? And do you have enough save to even be able to get you where you want to go? Um, if you're approaching Social Security age, we can help you with Social Security maximization planning, because let me tell you, folks, there are a lot of combinations of how and when people should take Social Security based on a whole plethora of factors. Okay. And then, you know, Medicare. A lot of folks are coming into that turning 65 this year, and you're going to be inundated by every insurance salesman on the face of the planet trying to sell you a Medicare supplement or a Medicare advantage plan, and that alphabet soup with Medicare Part A, part B, part C, part D, it can be very, very confusing.

Mike Zaino:
So if you want to know anything about that, pick up the phone and give us a call. But the bottom line is you're going to see what's possible if you work with us comparatively to what you're finding yourself in, in your current situation. And, you know, another note if you haven't heard from your advisor lately, please talk to us and get a second set of eyes on your situation. And if you're on the right path, guess what we're going to tell you? Great job. Keep it up. But if we notice anything that we might be able to tweak just by some slight adjustments, that puts you in a better situation. Wouldn't you like to know that before you retire? That's my question to folks. Most people would say yes. So if you are 100% sure that you're going to have a great retirement, you don't need to call me. But if there's any doubt, I'm talking about a .0000 1% chance that you know what I'd really like to know. Okay, then let us help you get started with that complimentary consultation. And you can.

Producer:
Do that by calling 704 5601573. That's 704560 1573. You could also go online to Money Matters with Mike all spelled out all one word.com. That's Money Matters with mike.com. Um boy some some great stuff uh, in there and a great value, um, for our listeners to, to call in or go to the website and take advantage of that no obligation consultation. And, um, also, you know, another thing that you talk about in the consultations and, and as you go on forward and in working through a plan with someone is how are you generating income during retirement? And one of the things, too, that I think a lot of people think, well, you know, well, my income is going to come from Social Security and then I've got my either my investments or my savings or something, and I can just take money out of that when I need it. That's not really a plan, first of all. And secondly, um, you got to really make sure that you have a enough income coming in from whatever streams of income you have as you were just talking about, uh, you know, you don't want an income gap, you want an income surplus in retirement especially, but you also want to look at diversifying those income streams and have more than more than one. Definitely. Preferably three, four, five. Yeah.

Mike Zaino:
I mean, and there are a few different ways that that retirees are going to generate those different income streams. Right. And the most common are obviously going to be Social Security. If you're fortunate enough to have a pension, uh, any withdrawals or distributions that you have from your four or your IRAs or your 403 B's, um, some of you have a personal pension that you've created yourself because you have planned for that income in the future. And of course, we're talking about a fixed indexed annuity. And then, you know, others of you may decide that you want to work a little bit part time so that it gets you out of the house and put some pocket change in there and keeps you both socially, mentally and physically engaged. But, you know, diversification of those income sources, Matt, is paramount, okay? Because if you are somebody that is going to rely on just one single source of income, well, I'm just going to tell you right now that can be extremely risky, especially if that single source is Social Security by itself, because we've discussed it time and time again on the show. We already know when the coffers are literally going to be bankrupt and where something has to change.

Mike Zaino:
So please, please, please, having multiple streams provides a safety net just in case one source or another source diminishes or faces challenges, right? Plus it's just more long terme sustainable because you're retirement. Most people don't retire for, uh, a month or a quarter or a year or a couple of years. They retire for the rest of their life. We're talking several decades. And so having more diverse income streams enhances the sustainability of your finances over the long terme. And ultimately, we're talking about risk mitigation. So various income sources may have different risk profiles. And combining some of your higher risk income streams, like your investments in the stock market with low risk or zero risk income streams, say, from a personal pension that mitigates your overall financial risk, and it allows you the opportunity to adapt to all of those different changing circumstances. Because one thing about life, it tends to throw curve balls at us, and having multiple income streams allows. Raised to be able to adapt to changes in health, changes in family or changes in economic conditions much, much more effectively. Yeah.

Producer:
And that's the only thing constant is change in life. And that can really help you if you have more than one stream of income in retirement, multiple streams of income in retirement that can really allow you to be more, more agile, I guess, and and change things up if you need also opportunity for growth as well. Because I know, you know, you talked about building a personal pension and, you know, as far as a fixed indexed annuity goes, and not to ring that bell too often here, but one thing that I know that that you have talked about before, Mike, that you plan on doing actually in your retirement is having multiple fixed indexed annuities, laddered, so that you can generate, you know, multiple streams of income that way as well. And those are those are vehicles that are going to continue to grow.

Mike Zaino:
Absolutely, Matt. And I can't believe I'm smiling right now for anybody watching us on, on YouTube, um, is because I was literally about to say that and you teed it up so perfectly as you always do, right? So one of my plans is to purchase a fixed indexed annuity every year for seven years. Now, why in the world would I do that? Well, because in ten years I'm going to turn on one stream of income. And then in 11 years, 12 years, 13 years, 14 years, 15 years, 16 years, I'm going to turn on successive streams of income so that the older I get. Guess what, folks? The more money that I'm going to have. And that's just going to provide more flexibility, more freedoms, and obviously more of an opportunity for growth. And if if a licensed financial professional is saying that he's doing that for his own family, take heed, okay? I'm not just I walk the walk. I don't just talk the talk. Um, and so, you know, some people, it's really important to plan for legacy. And they want to make sure that their children or their grandchildren have something so that they can remember them by. Okay. And so diverse income streams can help contribute to that wealth building that can be passed on as a legacy to either your heirs or to charitable causes. And I think perhaps the biggest thing that you cannot put a price tag on is peace of mind combined with an enhanced quality of life. So knowing that there are multiple streams of income provides retirees with peace of mind. It reduces any financial stress that they may have, and it allows them to focus on enjoying their retirement years.

Producer:
So go to the website folks. Once again, it's money matters with Mike comm. Money matters with Mike comm. Or you can call 704 560 1573 (704) 560-1573 and book yourself right into Mike's calendar. Get that done because you know, he's as he said earlier in the show, um, ready to take your call pretty much at any time unless he's asleep or, you know, doing something that is, uh, taking up his time at that moment, like meeting with a client or, or on date night with his wife and all that kind of stuff. But you can get that free consultation by either going to the website or calling the number. And of course, we'll mention them a couple more times here before the show is over. And, Mike, it's important that this whole conversation really is super important. I feel like for pretty much all, all of our listeners, we're casting a wide net here because the thing that people fear the most, according to really survey after survey in retirement, the things that that that retirees really do fear the most is running out of money. And if you have enough, uh, diversified income streams, especially those that are designed to be around for as long as you are around, then you don't have to worry about running out of money before you, uh, expire. In other words, your money's not going to expire before you do, right?

Mike Zaino:
Right, right. And so, you know, there may be, uh, people out there going, well, you know, how could that happen? How how could so many hard working Americans run out of money? Well, folks, it happens all the time. It's because they didn't plan for this. They didn't plan for that. And like I said, life tends to throw those curve balls. I mean, number one, how about Social Security cutbacks? Okay. Did you know that back in 1940 there were 40 workers per retiree? That means 40 people were paying into the social security system for every one person that was taking it out. And today there are only three workers per retiree, and that ratio is expected to become 2 to 1 by the year 2050. So that's one way that it could happen. Another way that it can happen are by. Tax increases. So people may think that we pay high taxes now, but historically speaking we're in a very low historical tax environment. And so historically, like I said, taxes are lower than what they used to be. And so with increasing national debt, with increasing government spending with them, printing money like they do, many experts believe that taxes are going to have to go up in order to meet the just meet the nation's budget requirements, not even exceed, but just meet.

Mike Zaino:
And so that is coupled with inflation and those cost of living adjustments that everybody loves getting. But, you know, those adjustments reflect a 14.6% inflation rate just over the last two years. And some experts believe that including myself, true inflation has been much higher. Now, why do I believe that? Well, because I've looked at the shadow stats. I mean, they are astounding when you look at that stuff. So, um, another risk in how people can run out of money or buy their portfolio. Their balance is just dropping just like that. I mean, sequence of returns risk. And we'll talk about that here in a minute can be absolutely devastating to anybody that's in the retirement red zone, which is the five years immediately prior to retirement. And those five years once you are in retirement. So preservation of your assets is key in order for you to have enough money to make sure that you're funding your retirement as long as you do before you become room temperature. So, um, market crashes, who you may want to consider reducing the risk that you're taking with your current portfolio. So did you know that from 2000 to 2002. So those three years the S&P all right. The stock market saw three straight years of decline. It dropped 9.1% in 2000, 11.9% in 2001 and then 22.1% in 2003.

Mike Zaino:
So imagine you just retired at the beginning of 2000 and you saw three years worth of decline. Your money will never last as long as somebody who retired in 2010 and saw the longest bull run in the history of the market. So sequence of returns that risk, folks, it absolutely matters. And another thing that can help, you know, absolutely eviscerate um, retirement is health care expenses. So between, you know, prescriptions, common procedures and then potential long Terme care expenses, a couple that's retiring today, they may need to spend upwards of $315,000 throughout their lifetime just in their health care for retirement. So. Doesn't even court, you know, come into having to care for a loved one. And so if you have to, you know, care for a dependent parent or a dependent spouse or a dependent child, that's going to add additional monthly expense to, you, know, for you to have to look after those family members. So, you know, that's how people can run out of money. But the good news, the light at the end of the tunnel is that you know what you can, you know, beat the odds and you can tackle this unsurmountable task just by putting a plan in place, being disciplined and sticking to your guns, so to speak.

Producer:
Yeah. And that is really what it comes down to, putting a plan in place. But not only that, actually working that plan, you know, you have to to stay on it and then you know, you're going to be set up for success in your retirement years. And folks, if you don't have a plan, once again, go to Money Matters with mike.com. You can start getting a plan. Money matters with Mike Dot com or call Mike at 704 560 1573. And you know, a lot of people, it turns out, at least according to this one survey, uh, it's a survey from the Alliance for Lifetime Income or Ally here. Most people just really seems like don't have a plan. They're telling us that in this data, in a kind of a roundabout way, that's because 51% of people who responded to this, and these are folks between the ages of 45 and 75, are not prepared. They say they don't have enough saved away for retirement to last their lifetime. And that's a kind of a staggering statistic. More than half of pre-retirees and retirees are not prepared.

Mike Zaino:
And that may be staggering. To the folks listening. It's not staggering for somebody who deals with that unpreparedness literally on a daily basis. And and, you know, at first, early on, I, I was kind of shocked, but now it's just okay. I come to expect the fact that folks are not prepared. And when they come to me, it's like, all right, where are you in the retirement process or in the planning process? If you're coming to me and you haven't prepared at all and you are now trying to retire, guess what? You've already made your bed. And I've got to try to make that bed as comfortable as I possibly can with what you bring. Um, but if we get to you early enough and even with, you know, with five years, ten years, um, there there are some things that we can put into place that will positively affect the ultimate result and allow you to enjoy, you know, that retirement. But, you know, some interesting quotes that that guy that Jason Fitchner, who's the the senior fellow and head of the Retirement Income Institute, he's also a chief economist at the Bipartisan Policy Center, both of which are based in Washington, DC. You know, I found this one, um, kind of prophetic, right? There has been a seismic shift in retirement security from a time when many people could rely on a pension in retirement. Today, many Americans are facing a retirement crisis because they are at risk of running out of money in their retirement. And he also said that this is the first retiring generation in which more than half do not have a pension to cover part of their retirement costs. And I was like, wow. I mean, that is a staggering statistic, right? It's huge. So what do we do? That's the question. What do we do?

Producer:
Matt. Yeah, I mean, it really does beg the question, okay. If so many people are unprepared and so many people just don't have a pension these days, then what is it that you do? I mean, it's, um, you can, as we mentioned a little bit earlier and as you talked about with your, you know, sort of plans to generate is several different streams of income for yourself. You can generate your own personal pension. Um, but it's, you know, it's something that either a, you might not have considered because you've heard bad things about a particular type of income annuity, for example, or, um, you know, you just you just haven't considered it because you had never really heard that that was an option or thought of it that way, that you can build your own personal pension. Yeah.

Mike Zaino:
And so the ally survey had also revealed how customers want they want 80%, 80%. All right. So so what is that 4/5 of their retirement savings to cover their needs in retirement. They want that money to be invested in safer investments. And those that are protected by either a pension and or an annuity or call it a personal pension, they have a significantly more positive outlook on their retirement prospects, according to the survey results. Why? Because, you know, especially with the ones that we talk about, you participate in the gains of the market. But you are. Contractually guaranteed to never lose a penny to market volatility. So when we take market volatility off of the table and we add in, you know, guaranteed lifetime income, um that makes people feel at ease. And so the consumer demand for these annuities has skyrocketed. And it's at an all time high amid those concerns about unprecedented market volatility and a falling retirement investment environment. And so, you know, investing in something like a fixed indexed annuity can reduce the stress that's caused by those market fluctuations.

Producer:
Yeah. And can can give you that protection not only mentally, emotionally but also financially. Uh, give you that protection, of course. And uh, get started down that road, folks. Go to Money Matters with Mic.com. Sign up for that free consultation there. And Michael, get in touch with you and set things up. Um, and so, you know, it also will you talked about this and we're going to dive into it, uh, just a little bit in more detail about something called sequence of returns risk. Right. And there is a concept that we are going to bring up here is called the Lost Decade. When we say those those words, Mike, what do we mean by the lost decade? It's like do we do we is it under the couch? Where'd it go? You know.

Mike Zaino:
No, I mean, it's it's making me rub my head in remembrance. Right. And because it causes so much pain, thinking back to a decade of, of financial, um, loss, I mean, that's really what it was. And we're of course, we're talking about the SNP's performance from 2000 all the way through 2009, okay, through that ten year period, the S&P 500, which is an index of 500 large cap stocks, it actually had a negative return over the entire decade of -9.1%. And so I already said the first three years was, you know, -9.1%, -11.9%, -22.1%. Well, then we had a few good years, 2003 through 2007 may actually made money, but then we all know what happened back in 2008. I mean, it seems way off in the distance, but that was what, 16 years ago? That's it. Okay. The market lost, the S&P lost 37%, 37% folks before it rebounded in 2009. So when you total all of that up over the course of that decade, your finances, they were lost. They were gone -9.1%. Now why does that matter? Well, we want to help protect our clients from that sequence of returns risk. And so Einstein, we've talked about him before on the show. Pretty smart individual called compound interest, the eighth wonder of the world and said those who understand it will earn it, while those who don't will end up paying it. So it's important to remember that compound interest can work both for you as well as against you. So please, please, please consider scheduling a free consultation where we can help you implement the plan that allows you to capture stock market like gains, but without the stock market risk. Okay, so either give me a call (704) 560-1573 or visit Money Matters with Mike comm and fill out the contact us page. Yeah.

Producer:
And that's you know, just an example of what, you know, the, the insights and the, the help really that you can get the guidance that you can get planning for your retirement years. Um, you know, you can call or go to the website, as Mike just said, schedule that free consultation and then, you know, get a smart plan in place for your retirement years. And one of those things that you're going to find out in this whole process, too, is, um, how much you're paying in fees. Boy, Mike, do you do you encounter and I facetiously ask this question because I kind of already know the answer. Do you encounter folks who don't understand what they're paying in fees.

Mike Zaino:
All the time? You know, especially if they're working with, you know, some some of the wirehouses. And I'm not going to call out specific names, but, you know, or a specific name. But as a collective, Edward Jones, Merrill James, Charles Schwab, Raymond, you know, Franklin Templeton, all the different, you know, folks that are out there, we find that most people that we meet with have absolutely no clue, um, how much they're paying in fees within their portfolio as well as retirement accounts. Many are paying excess fees for assets that are actually underperforming. And so fees affect everyone who is saving for retirement, regardless of how much money they have in their nest egg. I remember Steve Kroft, when he was on 60 minutes, did an entire segment about the 401 K and how 401 S were just inundated with. Fees. And so I think it's real important for folks to remember that retirement is about income. It's not about building up this massive nest egg or reaching an elusive magic number, but it's about your cash flow within your retirement month. Right. And if at the end of the month there's a gap like you mentioned earlier, that's not the goal.

Mike Zaino:
All right. If there's more month than money, nobody wants to find themselves in that situation. So we help our clients take advantage of fee efficient strategies while generating both safe and predictable income streams that they can absolutely never outlive. And for those who have been, you know, under a rock for the last, um, 40 minutes or so, um, did you know that you can establish your own personal pension by replacing just the bond portion of your portfolio with a fixed indexed annuity, and that also deletes the fees on the bond portion of your portfolio. And that's just one example. All right. Um, another question that I ask is and I mentioned it before, do you know what your expense ratio is? And that's basically the fees, the management fees that you're paying divided by your total investment in, you know, the funds that you're invested with. So schedule your free no obligation consultation. I can help point out where you are right now. And once you realize that, you may think, wow, I think, uh, you know, my my portfolio needs a tune up.

Producer:
That's it. You're going to take your portfolio to the mechanic, and his name is Mike Zaino, and look under the hood and say, this dog won't hunt. No, um, that's just, uh, slightly facetious, but it's kind of, uh, kind of what he might do if, uh, if that dog won't hunt. Uh, as a matter of fact, money matters with Mike. Comm is the place to go to get in touch with Mike Zaino for that free consultation. Money matters with Mike comm. You can also do it, uh, kind of the old fashioned way a little bit, if you want. If that is your preference, picking up the phone, you know, it's. That's Mike's holding it up right now. He's got the phone with him at all times. Uh, so if someone were to call in just a couple of minutes when we're done with the show, if someone were to call, then, then he would pick up. Not during the show, but just right after. Absolutely. Uh, he'll do that. 704 5601573. Well, Mike, that's, uh, just really gonna about do it here for the time that we have to spend together. Sir, I appreciate each and every thing that you bring every week to the show, and I look forward to doing it again next time.

Mike Zaino:
Buddy. This is a great show this week. I you know, I think we had plenty of meat on the bone for our listeners to chew up. I thank you. And the production, you know, quality that you bring to the show and the way you do team me up. But most of all, um, I just gotta give props to our listeners who religiously every Saturday morning at 9 a.m. in the Charlotte Metropolitan Statistical Area, who tune in and listen and share the show with their friends, and then all of those that listen on podcasts on your own time. And no matter where you are, thank you. Because without our listeners, we don't have a show. Whatever you're doing this soggy weekend. Okay. Um, I hope you do it to and enjoy it to the fullest extent. And as always, make it a great day.

Producer:
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 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 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.

Producer:
Fixed annuities, including multi year guaranteed rate annuities, are not designed for short terme investments and may be subject to restrictions, fees and surrender charges as described in the annuity contract. Guarantees are backed by the financial strength and claims paying ability of the issuer.

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