Mike discusses some ways to be opportunistic with your money. Also, he will answer the age-old question, “Can money really buy you happiness?” And he will reveal the results of a study that shows the American retirement system does not get sterling grades compared to other countries.
Schedule a no-obligation consultation here.
Call Mike today at 704-560-1573


9.26.22: Audio automatically transcribed by Sonix
9.26.22: 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 Zeno. Get set for a full hour of financial information and economic news affecting your bottom line. Mike works hard each day to educate Americans like you on how to reach the financial freedom they've worked so hard for. And he can help you, too. So now let's start the show. Here's Mike Zeno.
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. Fall is in the air, although they say it's fall, but it's been hotter than the hinges on the back gates of hell lately. But today we are also going to bring the heat. The whole goal of our show is to arm you with information that you can actually use and give you plenty of meat on the bone each and every week to chew on. And I'm really excited for today's episode. On how to be opportunistic with your money. And once again, I have the distinct honor and privilege of being joined by the one and only Mr. Matt McClure. Matt, how are you doing today?
Producer:
I am doing great, Mike.
Mike Zaino:
How are you, buddy? I am doing awesome. Like I said, fall is in the air. It is technically fall, but it's been warm here in the Carolinas and I know it has down in your neck of the woods as well.
Producer:
Oh, yes, it has. Especially these last couple of days. Boy, I feel I've always on days like this, especially when it gets to be this time of the year, I feel sorry for anybody who has to be outside and and do hard labor because it's just not a fun situation.
Mike Zaino:
No, it's not. And I know last week the the President's Cup, the local not local, but international PGA event was held here in Charlotte at Quail Hollow. And I think on Thursday, it was 95 degrees out there. I mean, it was blazing hot. And that was supposedly the first day of fall.
Producer:
Yeah, No, not not so much. Well, that's the thing is hopefully that that sweater weather, as they say, is going to be here before long. And we'll all be in a much happier state of mind with the heat behind us. But yeah, I know we've.
Mike Zaino:
Got a lot of folks that call me crazy. I like the 40 degree mornings and the 60 degree days. To me, that's perfect. I can be happy in shorts. I can be happy with a sweatshirt or I can be happy in jeans. You know, it's just perfect weather for me.
Producer:
That's me too. I love the Fall is my favorite season of them all. Not only is it pretty outside, but it just feels great to me. So yeah, it's a little and that's the thing is like, I don't like the heat of the summer like a lot of people do because I feel like you can always bundle up to get warmer. But if it's too hot, you can never cool off enough.
Mike Zaino:
When you're naked. There's no more layers to take off.
Producer:
Exactly. Go hop in the co, hop in the freezer or something at that point. But anyway, we've got a lot to talk about. As you said here on the show today, Mike, we've got some talk about how to be opportunistic with your finances. We've got more on the state of things in the economy with a little bit of inflation talk. We'll review a little bit. We'll play a little bit of a game to review our show from last week when we talked a lot about smart health and smart care. We'll see how much our listeners remember from last week's show. I'll probably see how much I remember from last week's show as well, and then a lot more, including stuff about how the US retirement system compares to the rest of the world. I know you're eager to get to that one, so we'll do that here in just a little bit. But folks, this is money matters with Mike, By the way, just in case you're just joining us here on the first few minutes of the show, Money matters with Mike dot com is the website that is money matters with Mike all one word or you can give Mike Zaino a call 704560 1570 37045601573 and that is the number to call for a full retirement plan consultation which is complimentary. That means free for all of your listeners.
Mike Zaino:
Mike That's true. We like to give everybody the most that we can possibly give. We love hearing from our listeners and so when you contact me, we'll be able to provide that comprehensive consultation at no charge. There's no obligation. You're only going to work with us if it's best for you. And we can help analyze your specific and unique financial situation and just determine what's best for you moving forward. So if that sounds like something you'd like to capitalize, I'm going to urge you, don't delay. All right. A lot of people like to plan on doing something and then it never actually happens. Give me a call today. 704 5601573. Or hit me up on money matters with Mike Dotcom. Money matters with. Like, all spelled out.
Producer:
And now that you've said that, you know about planning to do things and they never get done, I'm thinking about probably three or four things that I need to do. So. So thanks for that. It's like tying a tie and a string around your finger so you remember something. Mike Zeno is officially the string around my finger at this moment.
Mike Zaino:
No doubt it's just everybody's human nature to plan on doing something and then you set it down and life gets in the way, and the next thing you know, it's next year already.
Producer:
Totally. Well, one thing that we do want everybody to do and don't put this off is go get us wherever you get your podcasts, folks. I meant to mention this a second ago, but wherever you subscribe to podcast, you can find us there. I'm talking Apple Podcasts, Spotify, all the biggies and send us a message there as well. Like us, subscribe. So you get getting notifications whenever there is a new episode of Money Matters with Mike.
Producer:
And now for some financial wisdom, it's time for the Quote of the Week.
Producer:
So this week, our words of wisdom come from Zig Ziglar, who said this, quote, Expect the best, prepare for the worst, capitalize on what comes. I think that's probably pretty appropriate these days for the situation not only on Wall Street, but kind of in the overall economy in general there, Mike.
Mike Zaino:
Yeah, it goes to Main Street as well. And you know, I'm going to take today's Meat on the Bone segment from that quote. And we're going to talk a little bit about how to be opportunistic with your money.
Producer:
Hungry for something that you on here, some meat on the bone.
Mike Zaino:
That was a great quote by Zig. May he rest in peace. The word capitalized itself is a verb that actually means to gain advantage from and to truly be able to capitalize on your opportunities, you must be prepared for them. Right. It reminds me of another quote that I'm sure a lot of our listeners have heard as well. And it goes something a little like this. The optimist says that the glass is half full. The pessimist says that the glass is half empty and the realist is arguing that it's neither half empty or half full, but that the glass is twice as big as it really needs to be. And all while they're arguing over that is when the opportunist says, While y'all were arguing over that glass of water, I drank it. And I think I think that the American public can take a lot from that. Part of the quote is just on being prepared for when an opportunity presents itself. Cement success happens when preparation meets opportunity. And how can that be accomplished, you might ask? Well, I'm going to talk about one big way, and that is called dollar cost averaging and what that means. It's the practice of investing a fixed dollar amount, but doing it on a regular basis, regardless of what the share prices are. And what this can do for you is ultimately lower your average purchase price. And it also helps you to avoid trying to time the market because you're automatically going to be buying when share price is drop. And what it can really help you do is avoid taking or excuse me, it can help you avoid just emotionally investing. Right. You want to take the emotion out of investing. And so even if you don't dollar cost average each and every single month, if what you do is buy a little bit at a time, but do that on a fairly regular basis, you're still you're still going to get ownership in businesses at different share prices, and it's going to help you gather a whole bunch at different price points. It's kind of like eating vegetables, right? It's just good for you.
Producer:
There you go.
Mike Zaino:
Volatility that we've experienced, especially so far this year, volatility in the markets is normal. And Americans were absolutely lulled to sleep from 2010 all the way through 2020 when COVID started. I mean, think about it. It was the best ten year run in the history of the market, but that didn't last very long once COVID hit, did it? Matt?
Producer:
No, it didn't. You know, it just threw everything up on its head.
Mike Zaino:
It did. And so a lot of people this year, I think we hit on it earlier. A lot of younger people have freaked out this year and they've moved their money into safer accounts when they shouldn't have. Let me explain. You got on one hand, no one likes to see their money evaporate and their net worth drop. And then on the other hand, if you're in the accumulation stage of your life and you're buying whatever they are, stocks, index funds, mutual funds, you're buying them at cheaper prices. So you have to tell yourself that you're buying things that are on sale. Everybody likes a sale, right?
Producer:
Yeah. Just ask just ask my mom about that one. She if it's on sale, she bought it. She's been that way my whole life.
Mike Zaino:
Well, that's it. My mom. I got lots of people that I know, but it was on sale. Look how much I saved. And I'm like, Okay, you save 30%, which means you spent 70% more than you would have had you not bought it.
Producer:
In the first place.
Mike Zaino:
In the first place, right?
Producer:
Yeah.
Mike Zaino:
We can get off on that tangent, but I'm not. So if your dollar cost averaging and then if you're if you're also buying stocks that pay dividends and you've set those dividends to reinvest, in other words, it's automatically going to be doing some dollar cost averaging for you where the cash is buying more shares of the companies, which then produce more dividends. Which buy more shares of the companies and so on and so on. Right. And so if you're a little bit older, say in your sixties or beyond and you don't necessarily have time on your side, then switching to something safer might make more sense for you, depending on a couple of things. Number one, how deep your pockets are. And then number two, what your appetite for risk is. And if that's you, I have potential solutions that we can discuss. When you reach out to me at either money matters with Mike dot com or call me at 704 5601573. Well, there.
Producer:
You go it all. You know, here's the thing with the market, with the economy in general, with you know, any time you're talking about investing your money in anything, no matter what the vehicle, I think there is always an opportunity that presents itself. You just have to know how to take advantage of that and or work with somebody who knows how to take advantage of the opportunities that are out there. Because it might not seem to you as a layperson like there are any opportunities at all, but there could very well be plenty. You just don't see them from where you're sitting, right?
Mike Zaino:
It's hard to see the forest for the trees sometimes.
Producer:
Yeah, that's right. And a lot of trees in that forest you can't quite see through them. So there you go.
Mike Zaino:
You're mighty heavy today.
Producer:
We are. We're going to. We're just going to instead of money matters with Mike, we'll just call the show Quote of the week and we can just do quotes back and forth for an hour.
Mike Zaino:
Here we.
Producer:
Go. I'll keep I'll keep the ratings up. All right. Well, that is our Meat on the Bone segment there, Mike, and always, always look forward to that. It's it really is meat on the bone and some great stuff that our listeners can digest.
Producer:
Come on down as we test your financial knowledge in right or wrong.
Producer:
So this week we are playing a little bit of right or wrong, and this is the part of the show where you get to play along with us as our listeners. And basically what we're going to do this time around a little bit different than what we've done before, in that it is a review of last week's show. So let's see how much you remember from our discussion on smart health and smart care. From last week's, we talked a lot about Medicare, right? We talked a lot about long term care as well. So let's let's test your knowledge and let's test my knowledge as well. I'll present Mike with three different statements and he'll tell us if those are right or if they are wrong. Number one, in right or wrong, here is every day until 2030, 10,000 baby boomers will turn 65 and seven out of ten will require long term care at some point. Is that right or wrong, Mike?
Mike Zaino:
Matt That is absolutely right. And that is why it is essential to have a smart health plan in place for your retirement. Health care costs are one of, if not the biggest expenses for retirees. And God forbid, you have to have any type of in-home health care, assisted living care or long term care that can absolutely devastate any retirement nest egg. If you don't have something put in place that addresses that specific need. So, Matt, you are correct.
Producer:
Hey, there we go. I'm I'm one for one bat in a thousand starting off here. And yeah, that one. That one's very true. And it also it's sort of an illustration about, you know, how big the baby boomer generation is obviously, and how much more stress that is putting on the health care system in this country year after year after year. And or even just as that said, 10,000 baby boomers turning 65 each day, day after day, it's really putting more strain.
Mike Zaino:
And that's been that way for the past decade. I mean, it's a very, very large generation of boomers, for sure.
Producer:
It totally is. Absolutely. Well, there we go. So that's number one. And that one was right. So here's number two. You can have can you can have both a medicare supplement plan and a medicare Advantage plan at the same time, right or wrong.
Mike Zaino:
You got that one wrong, Matt. You cannot have both a med sup and a med advantage plan at the same time. The government won't allow it. See, med advantage plans are subsidized by the government. That's the Medicare part C that we talked about that picks up a lot of what part A and part B don't. But there are still some costs associated with that as far as possible. Co pays co insurances and out of maximum out of pockets. Right. And then you have the Medicare supplements which costs a premium and the only thing different is the cost of the premium. The plan is the plan is the plan. Remember, it's like buying a pair of jeans at Target or Wal Mart, same pair of jeans, just price differently depending on where you bought them. So those are better for folks who have the financial means. And to go to the doctor a lot because they're generally no co-pays and takes also what part A and part B don't cover but you cannot have both a mid sub and a mid advantage plan at the same time.
Producer:
Okay so that ones are I'm still.
Mike Zaino:
Yeah, you must choose which plan you have you want to go with.
Producer:
Right. It's a y, it's a one or the other. Not both kind of a situation. They're all right. But hey. Okay. So I got that one wrong. At least I'm still batting 500. Let's see how we can do on number three. And it is you can use an annuity to fund your Medicare expenses throughout your entire lifetime. Right or wrong.
Mike Zaino:
Matt? That's right. You can use one. In fact, this is a a smart idea for folks who are going to go into retirement knowing that they have medical issues. If you can structure an annuity to provide income and that you use that income solely to address your health care needs, I think that is extremely smart because it is ensuring that both you and your spouse will be able to fund those expensive costs during the entirety of your lifetime, no matter how long you live. And then when the inevitable happens, whatever's left in the annuity will pass on to whoever you've named as the beneficiary. So that's definitely a smart way to handle taking care of just health care costs and Medicare costs as well in during your entire lifetime.
Producer:
Yeah, and that's kind of like putting the money that you worked so hard for that's putting it to work for you in retirement as well. I mean, that's that's a huge goal, of course, should be a huge goal of any retirement plan. But that's one way to kind of go about achieving that, right?
Mike Zaino:
That's right.
Producer:
There we go. All right. Well, that is right or wrong. And two out of three. Hey, not too bad. Not too bad.
Mike Zaino:
That's Hall of Fame.
Producer:
Average Hall of Fame numbers right there, 667 average. So I can't you know, can't do much better than that. You know, I am human. I had to get one of those wrong after all. All right. So that is that. Now, I wanted to talk, Mike, about something that we saw here in the news very recently. It was this article from CNBC about the US retirement system getting a C-plus grade. And, you know, I, I know that. I know that you feel the same way. I love love this country, love, you know, the freedoms that we enjoy. There's so many things to love about the United States of America. I obviously grew up here. I was born here, raised here, Love it. Absolutely. Wouldn't want to live anywhere else. At the same time, there are things that we could do better, and the retirement system is one of them, as we find out here in this article. And it's the Mercer CFA Institute Global Pension Index, which gave the U.S. retirement system a grade of C plus in 2021. So talk through a little bit of this and which countries do better and which ones did worse.
Mike Zaino:
You know, surprisingly, we placed outside of the top ten, outside of the top ten in various rankings from all the industry players. But the one I guess the statistic that was the most staggering for me is that out of 38, what we would consider first world countries, right, in the organization, Organization for Economic Cooperation and Development. Just three countries rank worse than the US did in what they consider old age income inequality. And so you're talking about poverty levels for Americans, 75 years of age and older, where it's 28% of the United States senior population, age 75 or older, are living in poverty versus 11% on average for the rest of those countries inside of that. Inside of that study. And I thought that was just mind boggling right there. Yeah.
Producer:
And one of the reasons that they give here is because the US sort of has this patchwork system for retirement. Right. And so, like, one of those things that they talk about is how many Americans don't have workplace retirement plans. So they bring up, you know, the three legged stool illustration, right, about the retirement system, which is basically Social Security. Those workplace arrangements like a 401 K, for example, or individual savings. So those are the three legs of the retirement stool. But, you know, they say that one of the shortfalls here is a lack of access to one of those legs, and that's a lack of access to workplace savings plans, because just over 53%, just over half of U.S. workers had access to an employer sponsored retirement plan back in 2018 is the latest year that they had those statistics for. So not everybody has it. It's one of those the pillars of retirement. Here are the legs of the stool, rather. But not everybody has access to literally a third of what, you know, should be considered your plan that you at least have access to for retirement.
Mike Zaino:
Yeah. And if you don't have access to be able to contribute to a work or an employer sponsored plan such as a 401 K or 403 B, then you absolutely, unequivocally, beyond a shadow of a doubt, must double down on your personal savings. Otherwise you're going to have a two legged stool in retirement. And I don't know about you, but if you've ever tried to sit on a two legged stool, unless you have incredibly good balance, you're probably going to end up on your back side. And that's not a good place to be in retirement. But, you know, we talked or the article talked about which which countries rank ahead of the United States. And I thought the number one country was was really interesting. It's Iceland. Iceland topped these lists and then other nations that were also in northern Europe being Norway, the Netherlands, and then in regular Europe, Switzerland, Denmark, including Ireland and then Australia and New Zealand. All of those got very, very high marks and yet we just paled in comparison and it's like, okay, what are they doing differently? Well, they're they're taking care of, of their older folks. And that comes with a kind of a double edged sword because that means that in order to pay for that, they're going to have to tax the American public more. And I think that a lot of folks are are a little bit opposed to higher taxes. So the answer is, is just recognize that this is happening and prepare for it in advance. And so if you are well prepared, you don't have to become a statistic and be one of those folks that lives in poverty. As a senior adult, if you're aware of this, and even if you have ten, 20 or more years to prepare, then you can absolutely change your financial outlook in retirement.
Producer:
You know, it was funny, I was visiting had the privilege actually of visiting Norway and Sweden a couple of years ago, just just pre-pandemic the summer before the pandemic. So this is like July of 2019. And we we noticed that a lot of businesses there were closed because this was during the summer. So a lot of the businesses there were closed. And we were like, why or why are so many things closed? There was still plenty of stuff that was open and we had a great time and really, really enjoyed it. But like some random, like restaurants and shops were closed and things and so we were come to find out, you know, they not only did they have this, you know, retirement system that is obviously it's government sponsored and all that, but it's it's very robust and everybody is guaranteed the same kind of thing for retirement and all that. But but they also get like the whole summer off, like no matter if you work for the government, if you work for the the shop down the street, you get like the whole summer. It's like a six week vacation for for the summer paid and that's like required. So it's crazy how different things are in, in different countries. But as you said, it comes as a two edged sword.
Mike Zaino:
It definitely does. That's probably not going to ever happen in the United States of.
Producer:
America as much as we want it to know.
Mike Zaino:
And Matt, another thing that I found that was really interesting is that the. Article went on to state that IRAs aren't a catch all for workers without a 401 K, and that only 13% of households, that's it, 13% contributed to either a pretax or to a Roth IRA in 2020. That means 87% didn't contribute to one of these types of accounts. So what are you all doing with your money is my question, because if you have the opportunity to contribute, number one, you should definitely be doing it. I'll recommend a minimum of 15% of your net pay if that is possible. And then if you have an option to choose a Roth IRA or a Roth 401. K. Well, do you think taxes are going up or down in the future? Most everybody will agree that they're probably going to go up. So then why then would you possibly push off to a higher tax bracket when you can get those taxes out of the way today? And so it's just one of those things where you need to make sure that regardless, I mean, if you are sitting on a two legged stool, that's just not a comfortable place to be. And so if you don't have access to a workplace sponsored investment account such as a 401 K or 403 B, like I said earlier, you need to double down on your savings, please. I'm not saying this for my benefit. I'm saying this for your benefit so that you don't live in poverty as a senior adult.
Producer:
Yeah. Which is, you know, obviously the goal. And, and here's the other part of the article that I thought was was pretty meaningful as well. It's I think all of our listeners really because Social Security is something that pretty much all of us are going to benefit from. But the thing is, is that it doesn't really put you much above the poverty level at all with Social Security income by itself, right? So it's it's like that one leg of that stool. Yeah, it's there and it's something that's going to be there, we hope, and we pray for forever in the future. But, you know, it's not enough in and of itself.
Mike Zaino:
It's not enough. And if you're depending on Social Security to be the end all, be all for your retirement, I think you have another thing coming. I think you're going to have a very eye opening experience because, again, according to statistics by the year 2034, now we're about to come into the year 2023. So that's 11 years from now. Basically, in a couple of months, the Social Security program is only going to be able to meet about 70% of its obligations. So they're going to have to move the needle. It is not going to exist in its current state. It can't. Right. So something has got to happen. And if you are depending on that to be your one and only source of retirement income, I pray that you're not. But if you are, you really, really should start saving additional monies between now and the time that you're going to be able to claim Social Security.
Producer:
Yeah, 100%. And folks, for more help and all of that, navigating all of these issues in retirement in our our C C-plus retirement system according to this particular study give a call to Mike Zaino. That number once again, folks, is 704560 1573 And the website Money Matters with Mint.com.
Mike Zaino:
Yeah. If you don't want to settle for a C-plus and you'd least like to get an A, if not an A-plus, then call me.
Producer:
That's right. A plus, plus, plus, plus, plus. They or go.
Producer:
Here's the cost cutter of the week.
Producer:
So, of course, in these strange, very volatile times, we have like to share ways that you can cut your costs. And that way this week is something that that we've we've talked about it before. We've mentioned it on the show, but never as like the cost cutting kind of aspect of this being emphasized as like a very big reason to do it. But it is very real.
Mike Zaino:
It is. It is. And so when you replace bonds in your portfolio with fixed indexed annuities, for example, you can actually get a better rate of return and you can eliminate financial advisory fees. I mean, why in the world would you take market risk with your bonds when your bonds can lose their value? We've definitely seen that this year. If you just look at the history alone, you can see how uncertain the future of bonds is because inflation and fluctuating interest rates play a big role in bond yields. And see, here are some reasons why we think you should consider replacing bonds with a fixed indexed annuities. Number one is that you have the interest rate risk of bonds, and when interest rates increase, the current bond values decrease. They immediately become less attractive to investors who are looking for a higher rate of return. Number two, you have reinvestment risk with bonds, and this is the likelihood that an investment's cash flows will earn less in a new security. Number three, you have systematic risk with bonds, and this refers to the risk that is inherent to the market as a whole. It's going to affect the overall market, not just a particular stock or industry. And this is extremely unpredictable. And it's also impossible to avoid even diversification can't fix this issue, but the correct asset allocation strategy can make a huge difference. All right. So that's systematic risk. Then you have unsystematic market risk.
Mike Zaino:
And this is unique to a specific company or an industry similar to systematic market risk. It's impossible to know when that unsystematic risk will occur. And then the last reason I'm going to talk about will be the reduction in advisory fees. Investors who trade individual stocks, they may know how much commission they are paying their broker, but individuals who buy bonds, they often have absolutely no idea what type of commission they're paying. Bond dealers collect commissions on bonds they sell. Those are called markups, but they bundle them into the price that is quoted to investors. This means you have no clue as to how much commission you are actually paying. And there are no financial advisory management or portfolio of fees that are associated with fixed indexed annuities as the life insurance company or annuity carrier pays the commissions directly to the advisor, 100% of your money participates in inside of the fixed indexed annuity, and you can reduce, say, 40% of both your advisory and portfolio fees just by replacing 40% of your portfolio that is invested in bonds and reinvesting them into the fixed indexed annuity. And that's a no brainer. As the FIAS, they earn market like gains without any risk. So that is why the fixed indexed annuity is becoming its own asset class and is a great way to replace what used to be the way you'd get income in retirement.
Producer:
Yeah, you know, we talk a lot about the different aspects of retirement and kind of the a wide swath here, but for decades it has always been and kind of in the investment world the 6040 portfolio right 60% stocks, 40% bonds that's that's kind of the general advice that's been out there. Well, the way that bonds have been performing and you and you alluded to this a moment ago, you know, that is changing and I think, you know, pretty pretty rapidly.
Mike Zaino:
Yeah. Nobody should overpay for an underperforming asset. Period. End of.
Producer:
Story. Yeah. And there you go. And that's exactly what it's been doing is underperforming. So. Well, that is our cost cutter for this week. Replacing bonds in your portfolio with fixed indexed annuities. And you get a better rate of return, as Mike said, and eliminate those financial advisory fees. Well, we've got a couple more things here to to share. But first of all, I want to do this first, because we were just talking about the volatility of the market and, you know, and bonds going crazy. Of course, that's its own kind of thing. But there's been a lot of volatility, of course, in the market as well. But overall, where there's really been a lot of volatility, though, is in the crypto market. Yes. And that has been you know, it's been hot and cold. Hot and cold. Hot and cold. If you don't like the way it's headed, hang around about 30 seconds and it'll change, You know, So that's kind of.
Mike Zaino:
Like reminds me, that reminds me of that commercial. Talking about crypto.
Producer:
I'm a millionaire. I'm not a millionaire. I'm a millionaire. I'm not a millionaire.
Producer:
What's that.
Mike Zaino:
As as the second stick.
Producer:
By. That's right. Exactly that that is one 100% it but yeah so that that that's the thing like there is a whole other world out there when it comes to crypto and I actually recently put together a piece for the show about cryptocurrency and some some pretty smart people's advice about it and kind of the whole world of that type of investment. So let's take a listen to this about cryptocurrency. We'll chat about it on the other side. I'm Matt McClure with the Retirement radio Network Powered by a Micro Life. If amusement.
Producer:
Parks are your.
Producer:
Kind of thing, roller coasters can be fun. But when it comes to investing for retirement, not so much. One of the most volatile investments around is cryptocurrency. That means, sure, there's some potential upside, but is it worth taking a ride on the crypto coaster? First, What is crypto anyway? The website Investopedia defines it this way. A cryptocurrency is a form of digital asset based on a network that is distributed across a large number of computers. This decentralized structure allows them to exist outside the control of governments and central authorities. Bitcoin was the first such currency out there, so it's been the most talked about and faced the most scrutiny like anything in life. Crypto has its advantages and disadvantages. While it offers a faster and cheaper way to transfer money, its value is highly volatile. The technology has gotten some blowback from both sides of the political aisle. One of the most vocal critics has been Democratic Senator Elizabeth Warren of Massachusetts.
Elizabeth Warren:
Unlike, say, the stock market, the crypto world currently has no consumer protection. None.
Producer:
Republican Senator Pat Toomey, ranking member of the Banking Committee, who generally supports the industry, also acknowledges there are issues with crypto.
Pat Toomey:
Now, it's important to note that many people have raised legitimate issues about cryptocurrencies. These include their use in illicit activity and the possible effects on monetary policy and our existing financial infrastructure.
Producer:
But what do big time investors have to say about cryptocurrency? Here's Warren Buffett speaking at a recent Berkshire Hathaway shareholder meeting.
Warren Buffett:
Now, if you told me you own all of the Bitcoin in the world.
Warren Buffett:
And you offered it to me for $25. I wouldn't take it because what would I do with it?
Producer:
Still, cryptocurrency has legions of fans who swear by it and enjoy riding the daily roller coaster. So are you willing to risk your hard earned and hard saved money in a volatile cryptocurrency market? That's a key question to consider as you invest in your future with your retirement. Radio network Powered by a merrill Life. I'm Matt McClure. Remember, all of Mike's listeners receive a free financial consultation just for listening to the show. Visit Money Matters with Mike Dotcom to learn more and schedule an appointment. Thanks for listening to Money Matters with Mike and subscribing wherever you listen to podcasts. So there you go Mike. The up and down world. And up and down and up and down and up and down. World of the cryptocurrency market there. What do you think?
Mike Zaino:
Well, I mean, I've always said since people started asking me several years back, you know, what do you think in cryptocurrency about Chris? And I'm like, well, don't sit down at the poker table with more than you're prepared to lose. Right? And so I know people personally that have made a lot of money with crypto, and then I know people personally who have lost a lot of money with crypto. Heck, last year Bitcoin was at 64,000 and I think now it's below 20. So I mean that's what a 67 68% decrease. If you bought crypto at 64,000, that's a big kick in the gut. I also know people that bought Bitcoin when it was, you know, a few dollars a coin and now it's sitting at close to 20. So those people are loving life even though they wish they'd have sold if maybe they did when it was up at 64. So again, we don't know what we don't know. And one of the things that I think Warren Buffett said is that if he wouldn't, if you take all the Bitcoin in the world and gave it to him, he wouldn't take it because what would you do with it? You know, And I'm thinking to myself, Well, that's true.
Mike Zaino:
What do you buy cryptocurrencies with cash, the US dollar, or you buy it with Ethereum? And in order to buy the Ethereum, you got to get what deposit cash into and linking it to your bank account. So it's just like some of the people are real, real, real big proponents of it. They love the idea of crypto. Do I think eventually the world might go to a digital currency? Possibly, but we don't know. And are we ready for that now? I think it's still in it very, very much in its infancy, even though it's been around for almost a decade or just over a decade at this point. So again, don't put any more than you're prepared to set on fire into cryptocurrencies. And I really, really, truly believe that with all my heart. And again, there will be people out there that are going to tell me I'm crazy because they've made a lot of money. But I also can show you on the flip side, people who've lost a lot of money.
Producer:
So yeah, we make that comparison sometimes about how, you know, how about Wall Street can be a lot like Vegas, you know, and you're sort of gambling with your money because all of your money is at risk there. This is even more so when you're talking about crypto, because not only is at risk, it's also a highly volatile investment where you kind of you don't know where things are going to head. It could you could be one of those people like you talked about, that things wind up very good for you or it could be the exact opposite.
Mike Zaino:
And the fact that the regulatory environment is virtually nonexistent, that should raise a little bit of a red flag as well.
Producer:
Yeah, absolutely should. Well, that's a look at cryptocurrency and the roller coaster ride that it is. As I started off that piece with some some sound effects from an amusement park and people screaming and all of that, that's kind of what it's like. Well so as we ride. Yeah. Is it is it fun or is it terrifying? Oh, a little bit of both, yeah. So as we move on here in the show, I wanted us to discuss another study, another kind of a bit of research. You know, the old adage kind of goes that money can't make you happy, money can't buy you happiness. Right? And I guess, you know, to to to an extent that's true. Like, there's not an aisle, a happiness aisle in the local Wal-Mart. You know, you can't just go and buy a box of happy can't.
Mike Zaino:
Buy a box of happy.
Producer:
That's that's that's the thing. And but there is some evidence here, though, that says that the old adage might not exactly be true, that money could actually buy you happiness or at least make your life a lot easier.
Mike Zaino:
Yeah. And this this research and it was I guess if we're referring to the same article, the one in US News and World Report.
Producer:
Yeah, that's the one this is. Yeah, it's. Yeah. U.s. News and World Report. That's right.
Mike Zaino:
Right. So, so this research was led by Wharton School senior fellow Matthew Killingsworth. And it wasn't just a small sample. It was like 1.7 million emotional snapshots. And it found that people that had more money continue. To be happier regardless of the amount. So, I mean, just those little bit of increases in money made people happier. And so I thought that was pretty interesting in that not necessarily like you said, you can buy a box of happiness, but just having money gives you options. And then those options often give you freedom and freedom to live the life that you want to live. And that was echoed by the Wharton fellow. Mr. Killingsworth said the exact same thing. Money provides people with a sense of autonomy and freedom to live the life that they want to live. It's not necessarily about buying the fancier cars or having nicer meals. It just gives them options.
Producer:
Yeah, that's right. You get you do get options. And there was a country song, I think, not too long ago called Money Can't Buy Me Happiness, but it can buy me a boat. Oh, yeah.
Mike Zaino:
I know that one. I like.
Producer:
That one. Yeah. There you go. And that's that's, I think, a good example of that. It's like, you know, money can't money can't necessarily buy me that box of happy at the store, but it can buy me a boat and it can buy me a new car and all of these other things. And here's the thing, though. So you might listen to this and think, okay, well, what? Is there a certain dollar amount that I need to have, Right. To be one of those happier people? And Mr. Killingsworth at the Wharton School said, no, not really. So there's no critical level of income that changes the relationship between more, more money and more happiness. He said that happiness is correlated with other life factors like education, marital status and all that. He says that those findings do really indicate that the relationship between income and happiness is stronger, as That's why I think inherently we talk a lot about, you know, having income in retirement. I think that's one of the reasons why is because it makes you more stable. It helps you live, as you said a minute ago, the life that you want to live.
Mike Zaino:
Yeah. And I don't think that money and having more of it automatically yields the happiness. It's how you spend the money that you have. So if you're investing that money and that money is making money, that is obviously going to make you happier this year and you're investing money, you've probably not made a whole lot of money. In fact, you're probably negative for the year if you're invested in any of our markets for sure. And so that can make you feel a little bit more down. But at least you have those accounts open. And so people get happiness from buying material things they get happiness from by spending money on vacations and doing experiential things. And, you know, the article went on to say that people get more happiness from buying experiences than they do from buying material things, which I tend to agree with. In fact, one of the things that we do in our family for Christmas is we tend not to give gifts, but we tend to give experiences because those create memories that last a lifetime. Whereas the gift that you give may not matter to somebody in the next five years, especially if they're younger, right?
Producer:
Oh, that's that's very, very true. If it's some, you know, toy or something that they might be all about in that moment. But then you give it, you know, even a couple of years and it might not have that same emotional tug on them. But yeah, that's absolutely right. You know, I say all the time that my own personal life that I would rather have experiences than things most of the time because as you say, that does create that memory and it's something that you can share and always have like that. It's, you know, an experience is sort of it's an intangible thing. You can't hold it in your hand, but you will have it with you for the rest of your life still.
Mike Zaino:
Yeah, I can promise you that. You're 8 to 10. Ten year old is not going to remember what toys are, a slew of toys that you purchased for him or her. But you take them to a trip to Disneyland. Okay. They're going to remember that trip for the rest of their life.
Producer:
Absolutely. Yeah, I love that. Well, yes, that's, you know, just a little bit about money and buying happiness. And that results with that new study. Although I will say that these days, I guess with inflation, money buys a little less happiness than it used to.
Mike Zaino:
Probably true that true.
Producer:
That wish that now see, what they need to do now is come up with a happiness inflation index so that we can tell how much happiness our money can buy with any given rate of inflation. Maybe that's my maybe that's $1,000,000 idea. Something right there for me. I don't.
Mike Zaino:
Know. There you go, Matt.
Producer:
Go. Nobody steal it. All right, well, a few more minutes here left in the show, Mike, and we've talked about a lot of different things, a little bit of kind of a hodgepodge of things today on the show, but a lot of great information, a lot of great stuff to share with our listeners. And one of the final things here is actually I don't know if you've seen have you seen this Netflix documentary is called Get Smart with Money?
Mike Zaino:
I have not seen it, but I've heard about it. And now that we're going to be talking about it, guess what my homework is going to do? I'm going to watch Get Smart with Money because I'm just interested. And after reading this. The goal and what we're going to talk about today on the show, I'm going to have to get out there and watch Get Smart with Money on Netflix, for sure.
Producer:
I literally I thought the same exact thing. I was like, okay, I think I had heard about it, but I hadn't watched it. And there are so many things on Netflix these days and on all the streaming services, you know, they're like umpteen different choices for, for everything. But this is a new Netflix documentary, Get Smart with Money, as we say. Pete Adeniyi teaches a couple how to save up to $8,000 a month and he teaches them these things to cut. So, I mean, this is a very personalized thing for this particular couple that he's doing. But I think that these three things in this article that we saw, this was an article from Business Insider were three expenses that really could apply to anybody to cut to start saving and even potentially retire early, because that's what this particular couple wanted to do. I thought the very first one that he recommended that they cut was very interesting. Amazon shopping.
Mike Zaino:
You're preaching, Matt. You are absolutely preaching. Amazon has made it so incredibly convenient to where you can just go on on your phone, on an app and slide around with your finger and just press. And the next thing you know, it's being delivered on your doorstep sometimes the same day still blows my mind that they're able to do that. But a lot of folks get caught up in that emotion of after a long day of work, they come home and the way they reward themselves is by surfing Amazon and then adding this to the cart and then adding that to the cart and adding this to the cart and adding that to the cart. And it's like, holy cow, This couple was spending $2,000 a month just on Amazon. I thought that was incredible. And then after three months of making a mental note of everything that they were spending on, which is something that we have talked about on our show, making sure you know where every single penny is being spent each and every single month. At that point, it becomes eye opening and they realized how much they were spending and they cut that down after three months to only $168 a month on Amazon. That's a huge reduction right there.
Producer:
That is absolutely huge. And you make a good point there about people doing, you know, kind of retail therapy with what was it, a show called Hoarders, I think. And it's literally like, that's not.
Mike Zaino:
What I.
Producer:
Meant. I well, it gives me a lot of anxiety.
Mike Zaino:
I just yeah, I'm like, I can't watch it. I don't see how people live that way.
Producer:
Oh, me either. And it's just I mean, literally just people sleeping in a room piled floor to ceiling with just a bunch of crap in their house. And it's and I just don't understand. But part of it, I think nine times out of ten, one of the things that leads to that issue that they'll come up with once they you know, if they do start in actual therapy, not retail therapy, is the fact that they they do retail therapy on themselves and they just buy stuff just because they can, because it makes them feel good for about the next minute. And then once they bring it home and throw it on the pile, then it just becomes more stress and anxiety and junk around the house. So that's another that's a good point that that that's something that can lead you down just a terrible path, not only in the wallet, but if you're with your lifestyle and with your entire life, your health and well-being, too, it can really take a toll. Well, that was that. So Amazon shopping, the number one thing on that list of three expenses to cut right now so you can save for retirement. Number two was groceries.
Mike Zaino:
Yes. And with inflation, we definitely have talked about this. The price of groceries has even gone up. I mean, when the price of eggs and mayonnaise is escalating the way it has, you really have to watch how and what you are buying and putting into your grocery cart, because one of the biggest cardinal rules is that you should never go grocery shopping when you're hungry. And I know a lot of folks that on their way home they will, before they cook, just go to the grocery store and pick up stuff. Well, if you've been working all day, chances are you're probably hungry and you're going to throw more things in that cart then you actually need to put in that cart. And so if you're a big spender and you like fresh meats every single day and you're going to you know, in in this article says banquet level spending for a small family, that's a lot. These guys were spending 1200 dollars a month and it was just for two people. So that's a lot of of of groceries right there. So one of the ways that you can kind of combat that is make a list, right, and plan out your meals and everything that you're going to need for the entire week and then purchase it all at once.
Mike Zaino:
You can use and capitalize on places like BJ's or Costco or Sam's Club and buy things in bulk, especially your dry goods, your spices, things that are going to last you for a while and stay in your cabinet for at least a year or so before their expiration date. There's no sense in going to a grocery store or, God forbid, a convenience store and picking those things up because you're going to pay a higher premium than you would as far as buying in bulk. And so the the ability to just either meal plan, meal prep, create lists and not shop while you're hungry, those things. Right. There are different ways that you can save on groceries. Also buying non brand name goods. And so if you like Corn Flakes and it's Kellogg's, you might consider going to Aldi and picking up their iteration of Corn Flakes. Or you get the picture. You don't have to always buy the brand name. Sometimes there is no substitute for the brand. But sometimes you know what? The brands are very, very close in quality and taste. So if it's going to save you that much money, then for sure.
Producer:
So here's how you know that You're from the South, by the way, is that my sister will not eat any mayonnaise except for blue plate mayonnaise. Now, I don't know if it's in the Carolinas, I think. Is it Duke's? It's big in the Carolinas. Duke's.
Mike Zaino:
It's in the South.
Producer:
It's Duke's. Yeah. Well, well, down here in Georgia, it's it's blue plate, at least. At least in my family. And like, I grew up eating blue plate. And that's like all that that we will eat. I think I got a jar of I think it was Kraft or something one time and my sister was she's like, you don't have any real mayonnaise. It's like.
Mike Zaino:
I don't even plate is what I've never even heard of that. Ever had a blue plate? No.
Producer:
You lived in Georgia for a long time and you.
Mike Zaino:
Never even Georgia. It was always.
Producer:
Duke's. Oh, we got to. We got to get you educated. I'm going to send you a jar of blue plain mayonnaise. There you go. I it must be, I guess it's a Georgia thing. And then but yeah, Duke's is all over the Carolinas there. But anyway, there's that and that. Actually, you and you do you make another great point, though, about making I have to make a list if I go out to go grocery shopping, because otherwise I will I'll come home with 15 things I don't need. And forget the one thing that I went there to get in the first place. So, so easy to do. Oh, goodness. So number three on the list of expenses to cut to start saving for retirement, according to this Netflix documentary, Get Smart with Money, number three is housing.
Mike Zaino:
Yeah. I mean, housing, especially here in the Charlotte and surrounding areas, has gone absolutely nuts. I know it has across the country because I've seen the statistics on housing over the last couple of years. And so when people were trapped in their houses for so long, they started looking at ways to improve their house. And so that's why the price of lumber went to the moon during the pandemic and people started putting pools in. And now people have become accustomed to that. And especially with the work from home environment, people are looking when they're searching for homes, they're looking for houses that have all the amenities, almost like going to a resort, but staying at home. And so if you're somebody who lives in a market and can capitalize on some of these higher prices, that if you were to sell your property, you can take that money and reinvest and downsize into a smaller property. If you don't need the space, whatever equity that you have. In addition, you could put that money into long term savings vehicles that would help ensure that you have retirement. Because if you can say your house is worth, I don't know, say it's worth 700,000 and you sell it for 700,000 and you turn around and buy a house for 400,000 by the time you're fees and realtor fees and closing costs and all that. Let's just say that you have $200,000 left. Well, that money can go a long way in retirement, right?
Producer:
Yeah, absolutely can. That's and that's the thing is you free up that that money and you the possibilities are pretty much endless with with what you can do with that amount of money. That really does go a long way in helping you get where you want to be when it comes to your retirement.
Mike Zaino:
Not to mention the fact that the other money you paid cash for for a house that you now live in. And so your overall lower expenses can give you a sense of happiness because that equates to more money in your in your pocket on a monthly basis.
Producer:
Yeah, absolutely. Well, all right, Mike. Well, that just about brings us to the end of this week's show. It has flown by once again. We have we have caught ourselves. We call ourselves a big one this time car ourselves a keeper, I think is a good show for a full of a lot of great information for the listeners.
Mike Zaino:
Awesome source. Matt, thank you so much for co-hosting people out and listening to land. Thank you guys so much for listening. Without you, this show does not exist, so enjoy the rest of your weekend and as always, make it a great day.
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 or pick up the phone and call 704560 1573 That's 7045601573. Not affiliated with the United States government, Mike Zeno does not offer tax, legal or investment advice. Consult with your tax advisor or attorney regarding specific situations. Opinions expressed are subject to change without notice. These opinions are not intended as investment advice, nor do they predict future performance of any product. All information provided is believed to be from reliable sources. However, we make no representation or warranty as to the accuracy of any statement. This information is intended to be educational in nature. It 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 are the results obtained from the use of this information. Are you concerned about market volatility, rising taxes, economic uncertainty, and how it all could affect your future in retirement? That 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.
Producer:
Where's the best place to hang your hat when you retire? I'm Matt McClure with the Retirement radio Network Powered by Emera Life. Whether retirement is just around the corner or several years away, time is ticking on planning not only your finances for your later years, but where you want to live out your post-retirement life. Personal finance website wallethub recently released its list of best states to retire in 2022.
Producer:
Florida, unsurprisingly, ranked number one, followed by Virginia, Colorado, Delaware and Minnesota, while.
Producer:
At job analyst Jill Gonzales.
Producer:
The top ten continues with North Dakota, Montana, Utah, Arizona and New Hampshire.
Producer:
So what makes a state one of the best to retire in?
Producer:
The study was based on 47 metrics, including tax friendliness, the elderly population, golf courses per capita and shoreline mileage.
Producer:
As for Florida, which landed the top spot this year.
Producer:
Florida excelled in tax friendliness, fellow retirees and things to do, but could use improvement with home health aides per capita, even.
Producer:
Though the Sunshine State is number one overall, If finances are your primary concern, you might want to consider a move to Mississippi. It ranked as the state with the lowest overall cost of living. As for tax friendliness, Alaska jumps to the top of the list. But what if you want some culture in your retirement years? New York ranks as the number one state when it comes to the number of museums per capita. The tradeoff there is naturally, the Empire State is one of the most expensive in the country. So where do you want to spend most of your time in retirement? And what factors are most important to you when considering a potential move? Those are key questions to consider as you plan for the future with the retirement radio network powered by O'Mara Life. I'm Matt McClure.
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