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Matt McClure:
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.
Matt McClure:
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 Zeno:
What's up? What's up? What's up, everybody? It's Mike Zeno coming to you live from Fort Mill, South Carolina. And I just wanted to wish everybody a happy Saturday and more than that, a happy Independence Day weekend. It is a great time in this country's history to be alive. I know we've got a lot of stuff going and a lot of people like to complain about this or that. But the fact that you're up today listening to this show is something to be thankful for. It beats the alternative. You're looking at branches and not staring at roots. Is that true? All right. So I just wanted to kind of remind people a little bit about who I am. I am a veteran to own business in the Zeno Group is is built around protecting people. I like to call myself a difference maker. And eliminating debt and protecting people's wealth is my absolute goal. And today we are joined we have the privilege to be joined by the one and the only, Mr. Matt McClure.
Matt McClure:
Hey there, Mike. Now, you know, not everybody says it's a privilege to have me around, so I appreciate that.
Mike Zeno:
No worries, brother. No worries.
Matt McClure:
No. How's it going?
Mike Zeno:
It is going. Like I said, it's a it's a beautiful Saturday here today. And again, just just grateful to be able to have the opportunity to to enlighten the people in listener land with knowledge on the financial front.
Matt McClure:
That's right. And that is the goal. You like to be a difference maker as you as you say. And if that sounds good to any of our listeners out there, money matters with Mike is, of course, the name of the show. And so therefore money matters with Mike. Dotcom naturally is the website 740 5601573. That number once again 7045601573. If you'd like to know more about what we what all we talk about here on this week's show and Mike, you mentioned it that it is, of course, Independence Day weekend here in the beautiful Carolina region. So what are you doing? You got any big plans this weekend?
Mike Zeno:
I actually do. For the first time in a couple of years, you know, the pandemic has kind of held everybody back. And this year we are getting together with families. So I will load up the old truck and the family. We're going to head south to Georgia and get a chance to spend some time with some family. So we're definitely excited about that. I'm not sure as far as the cookout plans, but we're we're excited about actually getting to travel for the first time in a while.
Matt McClure:
Nice. You're coming to my neck of the woods. I love that.
Mike Zeno:
That's right.
Matt McClure:
Well, I know that speaking of cooking out, that is most likely what we will end up doing coming up on the fourth. And as usual, I'm sure I will be the one tasked with doing all the cooking. They are they all burgers.
Mike Zeno:
Apple pie, all of Americana?
Matt McClure:
That's right. I usually handle all the stuff that goes on the grill on on the weekend and yeah. So that that's on any major holiday actually even the cold ones sometimes usually I remember a couple of years ago for Thanksgiving, I was out kind of almost freezing to death on the back deck at my sister's house, cooking for Thanksgiving. So it's very like, I don't know, I just always end up being the guy who's tasked with the cooking of the food.
Mike Zeno:
You're the man of the house. I mean, I resemble that remark. My wife does everything else. I mean, even to the point of marinating the meat and just handing it to me. And all I have to do is stick it on a on a hot grill and make sure I don't burn it.
Matt McClure:
That's right. It comes with the territory, I guess.
Mike Zeno:
Yeah, absolutely. The grill seems to be our territory. Yeah.
Matt McClure:
Totally. Totally. Well, you know, you said it just a second ago, Mike, you're traveling for the the 4th of July weekend to spend time with some family and filling up that truck. You got to fill up the truck with gas, too, you know, not just not just the family and all the supplies, but you've got to fill it up with gas. And we were talking last week about how much it was costing you. Remind me, how much did it cost recently to fill up your tank?
Mike Zeno:
So so I travel a lot. I speak in different cities across the southeastern United States and do some educational workshops on the financial. Or front. And so I'm having to fill up my truck pretty much every week. And last week was painful. It was $128 to fill up my truck. And this week I got a I got a break instead of $128, it only cost me 125. So I must have left a little bit more gas. I didn't quite push it all the way to below empty like I do tend to do. And I got a break this week, only $125. How do you like them apples?
Matt McClure:
Right, exactly. That reminds that reminds me of an old episode of The Dick Van Dyke Show. Now, I grew up watching Nick at night, so I'm not, like, old enough to have seen when the Dick Van Dyke Show was first on. But there's an episode where where Rob Dick Van Dyke's character, he gets he gets a brand new car. Right. And and he's all up in arms because he goes out, takes the car for a spin, runs out of gas, and he comes back home. He's just irate. He goes, Oh, I want to run out of gas. And Laura goes, Well, what would what was the gauge on when you left? He goes, empty. It's like, you know, because it's supposed to have at least a little bit left when it's on empty, you know, at least that's what we assume anyway, right.
Mike Zeno:
I guess there are two types of people in the world, those that like to top off as soon as that needle gets below like a half a tank. And then there are people like me who push it as far as it possibly can. Go into that note, I've actually run out of gas twice in my lifetime. Now, the first time the Lord blessed me because I literally was about a mile and a half from any gas station. I was on the interstate actually on the intersection between 485 and 77 South when my car just died. But I had enough speed built up to where I just put it in neutral and coasted. And there were no cars in front of me. The light was green when I got off of Westinghouse Boulevard and I was able to coast right up until the pump. And the second time, though, wasn't so lucky. I had to call the old dot to come bail me out.
Matt McClure:
Oh, good. That first thing that happened to you when you were able to just coast into a gas station, that same exact thing actually happened to me. One time I forget we were driving through Pennsylvania. One used to live in New York a few years ago, and we were driving through Pennsylvania for some reason. And I didn't realize, I guess, how far it was between one exit and the next. And so I get up kind of close to the next exit and start running out of gas. Like just the engine starts sputtering. And I'm like, Oh, no, oh no, am I going to make it? Just barely made it. And luckily the exit ramp went downhill instead of uphill because otherwise I'd have been way out of luck.
Mike Zeno:
Exactly. You know, again, all the stars came into alignment for me to I mean, I went all the way around that entire exit ramp. And if any of you have ever driven on 45 and headed south on 77, you know exactly what I'm talking about. It's probably a mile to a mile and a half before you get down to the closest gas station.
Matt McClure:
Not the best place you want to be when the old engine starts sputtering. They're not at all. Yeah. And really, I mean, the gas station, not a great place to be these days at all. I mean, the national average for gas recently passed the $5 mark for the very first time. They've, you know, fluctuated since, obviously. But just just really, really painful. You know, a little bit of perspective, though, on gas prices, Mike. We are still in historic territory, obviously, with these high prices. But when you take inflation into account, we've actually sort of been in this territory before. Like if you look back at, say, 1981 and this is this is from the website Inflation Datacom, they put together a nice little chart here for inflation adjusted gas prices. As a matter of fact, in the year 1918, gas prices were right around a quarter a gallon somewhere in there. But the you know, in today's money, that was $4.79 a gallon right there. Yeah. So if you fast forward to 1981 gas price average in today's money was 429 a gallon when you know on the actual pump you were you were seeing less than a buck 50 a gallon about a dollar 35 is where it peaked. But in today's money for 29 and then back in 2012 when gas prices were so high then this is one that will be in people's memories. It was about 350 a gallon. But actually in today's money, 4.47 a gallon. So, you know, your dollars have not quite gone as far as you might think if you adjust for inflation in speaking in today's dollar amount terms and how far the dollar goes now versus how far it went, you know, back when.
Mike Zeno:
That's why it's so important to understand that beast called inflation. And people think that by saving cash that they're saving money. And I'm like, no, don't do that if you've got. Cash under your mattress. You've got cash in a safe in the closet. You've got cash sitting in a and I'm using air quotes when I say high yield interest saving account at your bank, you're basically just going broke slowly because of the rising cost of inflation. It's like death by 10,000 paper cuts, right?
Matt McClure:
Exactly. I love that 10,000 paper cut. And you know how painful paper cuts are. So, you know, and as we're looking at we talked a little bit last week about some things that people can kind of do to to sort of help stave off the pain of inflation and high gas prices. And and, you know, talked about fuel efficient driving and looking into maybe buying an electric vehicle or something like that if you can afford one. Obviously, if you can afford the high price tag of that, then then you won't be burning any gas, obviously. So those are some things the federal government potentially looking into, although we don't know how much of a chance it has it actually passing, but a fuel tax suspension that would save, what is it, 18, $0.18 a gallon, 19, 18, 19, something like that for everybody. You know, every every little bit at least helps. But obviously, those are those are short term solutions that we're looking at there. Nothing really long term.
Mike Zeno:
That is that is true. And I think that, you know, when you are experiencing pain in your body, people tend to go to the doctor. And if you have those pains in any of your limbs or any of your cavities within, one of the first things that they do is they order an x ray. And so if this market has you experiencing pain, one of the things that I would have you do is take advantage of the fact that we offer absolutely free and no obligation consultations. And let's do an x ray on your current financial situation. We're able to analyze every little bit in piece. We're able to dissect whether or not you are headed in the right direction. Some of you out there in listener land, you have annuities, you may have multiple annuities. We're able to look at which type you might have. And if there's a better alternative or a better solution for you, we can make suggestions. We can find out what fees you are currently paying and compare your current situation to what's possible if you work with us. And so if you haven't heard from your advisor lately, give us a call and just get a second set of eyes, a second opinion. And one of the ways that we're able to help plan for the future, plan for income, for the future plan to mitigate your tax circumstances in the future is by placing a portion of your money. We talked a lot last week about fixed indexed annuities because they allow you to eliminate and delete a portion of your portfolio and advisory fees that you're currently paying. Plus, when you work with us excuse me, we're also going to plan plan you out at least to age 95. And if you have longevity in your family, if your people live into their nineties, then we're going to add 20 years on that. And we want to make sure that your plan is successful no matter how long that you live. So again, we provide this at absolutely no cost to our listeners and no obligation. You'll only work with us if that is what's best for you.
Matt McClure:
Yeah. And that and that is the point like, you know, doing what is best on an individual basis because there's no one size fits all sort of plan that's going to be right for everyone. It's not like you go to the, the, the financial store and you buy package A or package B or package C, and those are your only choices. It's a very personalized and individualized thing because everybody's circumstances are different.
Mike Zeno:
100%, 100%, everybody is different. But one thing that is common is we all put our shoes on one foot at a time.
Matt McClure:
That's absolutely right. And we we put the shoes on one foot at a time. We put the pants on one leg at a time. We're all humans. We all have problems and we all have problems with money. I don't know anybody, no matter how much money they have ever made in their lives, who hasn't had problems with money? What is there's more money. More problems, I guess sometimes is the situation. I've not really had that particular problem with money having too much of it myself, but it's possible. So no matter what your financial situation is and no matter, I think how how good of a hold you might think that you have on your personal financial situation. It always helps to have a fresh set of eyes on it, and especially somebody who really knows inside and out how to plan for the future and can take an outside look at your own personal circumstances and, you know, really wrap their heads around it, get with you and determine what's best.
Mike Zeno:
100%. Again, you go to a doctor when you're feeling pain. If your car is broken down, you go to a mechanic. If if you're hungry and you want to cook the food yourself, you're going to go to a grocery store. And if you don't want to cook the food yourself, you're going to go to a restaurant. So if if you're somebody out there who's a little unsure about what the future holds about you as an individual or your family and what that means long term, then it's always best to get a second set of eyes.
Matt McClure:
Yeah, yeah. And that's and that sort of goes back to that, the medical example as well. You know, if you're sick, you go to the doctor, as you just said. But then if you think that you're fine or if you are sick and you go to the doctor and the doctor says something that maybe you don't quite like, you get a second opinion. So there you go. It's always a good thing to get that second opinion and you have a better idea of what you're going to want to do to plan your future in particular. And I know that, Mike, you work with clients, of course, every single day. Are there any clients in particular that that have had that just pop in your mind about, you know, people who've had a lot of maybe maybe a particular issue that they've worked on and really, you know, come to you and maybe an annuity was the right thing for them or maybe, you know, some other sort of financial plan or investment was was right for them for their future.
Mike Zeno:
Yeah. I mean, I've had I've had a lot of different clients that have come in with completely different situations. Some, some people barely had any retirement nest egg built. And we had to put them on a plan that they could follow easy step by step plan, so that after just a few years, they would start to accumulate and see the results from their diligence. And then I've had people that have come to me with millions of dollars, but they admitted, Hey, I don't know the first thing about money. I've been very fortunate in my situation to be where I am. But as far as making sure that my family and my family and when I say that generationally speaking is set, how do I go about doing that? And so everybody in between again is different. And some of you out there may be just starting and you have no idea on how to get from point A to point B. Some of you out there may be in a position to where retirement is in sight, and you just want to make sure that all your eyes are dotted and all your t's are crossed. Some of you may have already crossed the threshold into retirement and you've got a nest egg. And now you just want to make sure that that money is going to be there for however long you live, no matter how long you live. Obviously, those are three examples of people who are in completely different situations, and we have a solution for each one of those types of folks. If you fall into any of those three categories.
Matt McClure:
Yeah, it's it's great, great stuff. And money matters with Mike, obviously the name of the show, as we mentioned at the top, money matters with Mike. All one word and with it is spelled out there in the in the address. It's money matters with Mike and if you'd like more information that free consultation that we keep talking about here. 704560 1573 that's 704560 1573 just about time here, Mike, to take our first break of the program. But I know that you have got our financial quote of the week for us to share.
Mike Zeno:
I do. I do. I like to give a financial quote of the week something that you can just kind of stick in your brain and call upon it from time to time. And this one comes to us from Benjamin Franklin. Benjamin Franklin said an investment in knowledge pays the best interest and just let that sink in. The more you listen to this show, the more nuggets that you'll be able to take and apply to your daily living. And ultimately, the more money you'll have in retirement.
Matt McClure:
Absolutely. And that is great knowledge is is power. And and the more you know, the better off you are. So I love that quote from one of our founders, which is appropriate on this Independence Day weekend talking about Ben Franklin there. Well, we are going to take a quick time out. Our first of the show, this is Money Matters with Mike. I'm Matt McClure here alongside Mike Zaino. Once again, Money Matters with Mike com is the website and if you'd like that free consultation 704560 1573 Stick around more money matters with Mike coming up right after this. In liberating strife.
Matt McClure:
Best part of today's show. Money Matters with Mike is available wherever you listen to podcasts and online at Money Matters with Mike Dotcom.
Matt McClure:
How long will Inflation Last? I'm Matt McClure with a retirement radio network powered by America Life. Americans and people around the world are struggling through the worst inflation we've seen in four decades. Everything from a gallon of gas to the food you buy at the grocery store is all more expensive these days.
Tara Sinclair:
We're also seeing it in all sorts of other everyday services. Nail salons, hair salons, you name it, you're seeing difficulties in terms of higher prices.
Matt McClure:
Tara Sinclair is a professor of economics at George Washington University. She says the inflation situation is a bit of a vicious cycle right now.
Tara Sinclair:
Employees are asking for higher raises and then employers are trying to figure out how to pass those costs on into the goods and services that they're selling.
Matt McClure:
Ongoing supply chain issues are a huge factor driving inflation. In an ideal world, Sinclair says, fixing those issues would be a perfect outcome.
Tara Sinclair:
If we could provide all the goods and services that people are demanding at the current prices, then we would be in much better shape and we wouldn't see this competition to buy these goods and services. That's really pushing up the prices.
Matt McClure:
But it doesn't usually work that way. Instead of increasing supply, the way we usually tamp down inflation is on the other side of the equation.
Tara Sinclair:
And so instead it's about slowing the demand for goods and services. And the way that that happens is through the Federal Reserve, our central bank, raising interest rates.
Matt McClure:
And that means things like car loans, mortgages, home loans and credit cards get more expensive. It's not the most pleasant way to do it, she says. But that is likely how inflation will cool down in the coming months. The Fed's interest rate hikes have also caused a lot of volatility in the markets. But Sinclair says if you're planning for retirement, it's not all bad news.
Tara Sinclair:
It is important to remember that they have seen strong years of growth recently up until now. And so we're seeing a lot of people that have a lot better financial conditions now then, particularly if we think about people that were trying to retire after the global financial crisis.
Matt McClure:
And she says many pre-retirees are looking to move assets into safer investments.
Tara Sinclair:
And there are these higher interest rates from the Fed are good news. So hopefully they can look forward to to that and maybe be able to find a steady annuity that will support them in retirement.
Matt McClure:
So how will you respond as interest rates go up in an effort to bring inflation back down? That's a key question to consider as you plan for your retirement years with the retirement radio network powered by a metro life. I'm Matt McClure. Welcome back. This is Money Matters with Mike. Money Matters with Mike is the website and I am Matt McClure here alongside the one, the only the difference maker himself, Mike Zeno. And Mike, we just heard there from an economics professor from George Washington University talking about inflation. And I was fortunate enough to be able to talk to her because shared a lot of great knowledge. And one of the things that she mentioned and I didn't even I didn't even have to prompt it, she she came out with this. So you see, folks, the economics professors are all over it, too. They know what's going on was an annuity as being a safe place to put your money. And the important thing to know about that is that is that your your principal is protected. You can get those those market like gains. Right. But your principal is safe if you put it into an annuity now 100%.
Mike Zeno:
And Professor Sinclair hit the nail on the head and kind of reminded me of a client that I had during the crash of 2008. Her 401. K lost 42%, which ended up being a whopping $126,000. Wow. Enough to buy a decent house back then. And it took her almost ten years to get back up to the $300,000 she had had prior to the crash. Before that crash absolutely devastated her account. And at that time, she was only 50 years old and so she still had time to allow it to come back. But then she came to me three years ago in 2019 and decided that she wanted to protect the majority of her money, even though she wasn't planning on retiring until 2025 when she turned 67. And so we took 300,000 and we moved it over into a fixed indexed annuity. And what that did was allow her to participate only in the gains of the market without having to suffer any of the losses. So when COVID struck in March of 2020 and the markets lost $6 trillion in five days, she didn't lose not one single penny. What she did do all right, however, is participate in the rebound. Now, if you remember, although it took 2008 financial crash ten years to recover, the 2020 market reaction to COVID only lasted less than five months, and within five months we saw all time highs.
Mike Zeno:
But as with everything in life, the one thing that remains constant is change. And so earlier this year, because of COVID and because of the impact of having to work from home and not going into the office, and she was spending more time around family. She actually decided to retire instead of working all the way until 67. So what I had her to do was her initial thought was to start claiming Social Security. I'm like, No, no, no, no, no, we don't need to do that. What we need to probably do is turn on the income from your fixed indexed annuity, and that guarantees a lifetime income stream. And by doing so, what that did was allow her to postpone taking the Social Security, which incidentally grows at an average of roughly 8% of the year every year that you delay it. And it was just a win win situation for each of us because she had more insight and hadn't thought about that before. She was just planning on taking Social Security right away, and I showed her a better alternative that would end up netting her more money in the long run. So again, just a win win situation.
Matt McClure:
Yeah, that's fantastic. I think a lot of people don't necessarily know that if you delay taking Social Security like that, you can end up with, you know, your monthly income later on when you do start taking those payments, being more and having just more income to rely on on a monthly basis from that Social Security benefit. And yeah, that can be something that's really beneficial to folks.
Mike Zeno:
And she had longevity on her side, too. So I mean, obviously when to take Social Security is is definitely an individual decision and based on an individual situation, because some people are going to do the Steve Miller band and take the money and run. Right. And then other people or who plan on living longer based on medical data, they've gone and had a very thorough physical and all the people in their family lived to be in their nineties. Or heck, I've had several clients that have made it to 100, anywhere from 100 to 104. So people are living longer these days. And that's why taking Social Security is an individual decision. And you want to use medical. The data, plus your knowledge of your family history to make an educated decision versus just flying by the seat of your pants. So when we looked at all of those factors for her and her individual situation, it made more sense to turn on the income stream from the annuity and postpone the Social Security income because she was a decently high income earner and it was going to make a significant difference in the payout just by having her wait those few years.
Matt McClure:
Yeah. And you make a great point there about people living longer too, and needing to plan for a longer period of time. Because, you know, I was actually just reading a book recently by a gentleman named Dr. David Sinclair. No, no relation to Professor Sinclair that we just heard from a minute ago. But Dr. David Sinclair, who is an expert and his research longevity, I believe, at Harvard for years. And, you know, he predicts you say you've had several clients make it to the age of 100. You know, he's been predicting that that those that milestone, that triple digit milestone is going to just become more and more common as time goes along here over the next several years and decades. And it could be that that it's a very common age to live to in the future, given the advances in medicine and all of that. So that's an important point.
Mike Zeno:
Not only that, the baby boomers, which prior to the millennials was the largest generation in the history of our country. And there are 10,000 people a day that are turning 65, and that's not going to stop for the next several years until that generation comes. So those people, along with those advancements in technology and medicine. Yeah, I see it all the time, people hitting that that 100 year mark. And I've always said that's my goal as long as I have my faculties and it's not painful for me to move, I'm going to make 100 years. That's my goal.
Matt McClure:
Well, yeah, that's going to be my plan to there, Mike. I guess we'll, we'll, we'll see each other at our, at our respective 100th birthday parties.
Mike Zeno:
How's that? Sounds like a plan, my man.
Matt McClure:
Good, good. I like that plan. Well, speaking of planning, actually, one of the things that that we talk about, you know, we've been talking about people living longer. Of course, death is one of those two things that they say as certain in life, you know, there's death and then, of course, there's taxes. And so people need to think about taxes, right. When they're when they're planning for their retirement, when they're planning for the later years of life. It's an important thing to keep in mind and really be smart about smart tax planning.
Mike Zeno:
True. I mean, and you know, there are only really two types of tax free investments. We talked about them last week, a Roth IRA and life insurance. And so we want people to be tax efficient and actually have a tax plan, be mindful of the tax bracket that you are in and how the choices that you make and the income that you pull in can affect the effective tax rate that you pay. And so, you know, I ask myself, what would I do? What would my Xanadu if I were in your shoes right now? And the first thing I would ask myself is, well, do I think taxes are going up or down in the future? And I think we can all agree that taxes most likely are going up because as I've said it 10,000 times, I know I'll say it 10,000 more. The government has two choices. They can either spend less money. Yeah, right. Or they can tax more. And so if you think that taxes are going up, you should have at least a portion of your money in a tax free bucket. So, you know, number one is that Roth IRA. And basically, again, just to make a short recap of what a Roth IRA does, you can fund a Roth IRA as long as you have earned income and you're funding it with after tax dollars money that you have already paid the taxes on.
Mike Zeno:
And so therefore, it grows tax free for its entire life. And unlike a traditional IRA, where you have to have required minimum distributions, just another way for Uncle Sam to collect money in taxes. The Roth IRAs are are rmd exempt. There are no required minimum distributions. Why? Because you've already paid the taxes. And then the other example would be life insurance. So to this point, Uncle Sam has not figured out a way to get his greedy hands on the death benefit from life insurance. So with that being said, you can set up a life insurance plan either to pass on benefit to your beneficiaries or on the more advanced financial component use of life insurance. You're able to actually take some tax free income and. Offset it as a loan against the death benefit. And when you do that, there is no tax on that principal money that you take out and the gains are tax free. The income that you bring in won't count toward the Social Security earnings test, nor will it affect Medicare in any way, shape, form or fashion because it's not earned income. So I think that utilizing a Roth IRA and life insurance are two of the things that if I were in your shoes, I would be doing immediately.
Mike Zeno:
And so one of the things that I wanted to do, and I don't mind sharing this with the audience because I think that you can tell my my genuine nature of discussing this. I am 51 years old, and I had a plan that when I was 50, I was going to purchase an indexed universal life policy and maximum funded and utilize it as another stream of income source tax free income. Again, during my sixties and beyond. Once I hit Social Security's full retirement age, which for me is 67, and they always say, if you want to make God laugh, make a plan. So again, mind you, I wanted to do this when I was 50. The month before I turned 50, I went into end stage renal failure and ended up having to have a kidney transplant. Now, there's a bright side of this. Obviously, I'm 51 and I'm talking to you today. So I had 17 people who were willing to give me a kidney, which blew me away. Absolutely humbling. I was so grateful, thankful for all of those people in my family and friends that said, hey, Mike, sure, we'll give you a kidney. But they started testing my wife and never had to test anybody else. It turns out that this young lady that I saw her dancing on a dance floor 31 years ago while I was the DJ in college, ended up being a perfect match.
Mike Zeno:
And so here I am today, alive, well, doing awesome and being able to have a passion for helping people and make a difference in their lives. Now, why am I telling you that? Guess what? I can no longer qualify for folks life insurance. Why? Because I had what they call a qualifying life event. So think about this. Right now you are the youngest and the healthiest you are ever going to be. Today, what happens to people as they age? Their body tends to degenerate and break down. So don't take a chance on waiting. If you're thinking that life insurance is in your future and you just happen to have a stroke or get diagnosed with cancer or get insulin dependent diabetes and some of the the restraints on that particular one, insulin dependent diabetes, we can still navigate around, have an organ transplant. Don't let life happen to you to where you're no longer eligible to purchase a life insurance plan. So I think that's why I tell people my personal story and I can speak with absolute conviction, saying that I had to pivot and figure out alternative ways to make sure that my family was going to be set for life.
Matt McClure:
Yeah, and that's great. And I, you know, when we first met and first started talking, I didn't obviously I know that now and before this moment. But about your your particular story, I had no idea. And that is I'm so glad that your wife was able to to give you that that gift. You said she was a perfect a perfect match. I think she was a perfect match in a couple of ways for you. Sounds like.
Mike Zeno:
Absolutely. God knew what he was doing when he put her in my path back then. But of course, now she likes to rub it in, says I can never get rid of her right now.
Matt McClure:
Now you're stuck with her. Absolutely.
Mike Zeno:
You know what? But I'm happy to be stuck with her. We we are literally joined not at the hip, but at the kidney.
Matt McClure:
Right. Exactly. Totally.
Mike Zeno:
And then on on the life insurance front, too, I had another client who was in his early sixties at the time that that is the last of his parents passed away. Obviously had two parents is dad passed away first and then his mom passed away after that. But when his mom left, they had a joint life insurance policy and that left him with a pretty nice chunk of change. And the best part about that financial windfall was that it came to him because he was the beneficiary of their life insurance plan. And again, folks, because it was the death benefit paid to him through the life insurance policy, he didn't have to pay a single penny of tax. And I'll say that again, the death benefit through a life insurance policy is paid to your beneficiaries 100% income tax free. And that's. Why it's one of the most widely used tools of the wealthy. So if you don't consider yourself wealthy, this just might be an opportunity for you to change your family tree.
Matt McClure:
Yeah, no, that's very true. And, you know, my dad passed away this year and luckily he had a good, fairly sizable, not huge, but fairly sizable whole life insurance policy. And that really has made life for my mom so much bearable ever since and really has set her up in a better, much better financial footing than she would have been otherwise. So, yeah, absolutely. And that's part of smart tax planning. We've been talking about that, of course, a tax free investment that that death benefit paid out in a tax free basis. There's also something that that we need to address here, smart income planning. And before we take our break here in just a couple of minutes, Mike, talk to folks about that. What is smart income planning mean?
Mike Zeno:
Well. So, I mean, if you think of what your income looks like now and you think of what you want it to look like in retirement, most people's goal is to go into retirement making the same or similar money as when they were working. But the reality is, is that most people are nowhere near. In fact, most people are experiencing 50% declines in income because of the fact that they're no longer working, and they hadn't sought any financial advice along the way. As far as, you know, what should I do with my money? If you were in my shoes, what would you do? And so, you know, one of the things that our parents and our grandparents used to do to provide income in retirement was purchase bonds. And so you see a lot of times now bonds aren't that attractive, especially over the last decade plus and last four years. I mean, the interest rate, the yields that they're paying is under 4% excuse me, 3%. And so you notice a lot of folks are actually replacing bonds with fixed indexed annuity. And we toss around the word bond all the time, but not a lot of folks actually know what a bond is. And so a bond is a debt security. It's similar to the issuer saying, hey, I owe you. And when a company needs funds for any number of reasons, they might issue a bond to finance that loan. They can issue it to raise money from investors that are willing to lend them certain money for a certain amount of time. When you purchase a bond, you're lending to the issuer, which might be a government, it might be a municipality, it might be a corporation. So think of it like a home mortgage. They'll ask you for a certain amount of money up front, for a certain fixed period of time. And when that time is up, the company or the government repays the bond in full. Does that make sense?
Matt McClure:
Yeah, totally.
Mike Zeno:
Yeah. So so during that time, the company pays the investor a certain amount of interest. And so why think about the question, why do people traditionally buy bonds? Well, because of that income stream. And they're able to offset some of the volatility that you might see from owning stocks. But one thing to keep in mind is that the market value of a bond changes over time as it becomes more or less attractive to potential buyers. And with bond yields being at such low levels, you might be wondering what's the best solution for your retirement plan? Well, again, a fixed indexed annuity just may be the saving grace in today's retirement plan. And we we referenced one economist earlier in our in our show, and there's a pretty famous one named Roger Ibbotson. He actually says that Bonds returns in today's historically low interest rate environment may be insufficient in meeting the anticipated retirement needs of US investors, potentially placing many at risk of outliving their retirement savings. And when I hear a world renowned a communist economist saying that, it really makes me scratch my head, and one of the biggest benefits of the fire, the fixed indexed annuity, is the fact that it offers steady income for life. And most other investment plans are insurance products. They fail to insure financial income, but with an fire, you never have to worry never have to worry about outliving your savings. Why? Because they provide lifetime income sources into your retirement plan. Having a secure income throughout your retirements allows you to make or take more risk with the rest of your portfolio. And when looked at in totality, it can add up to higher total spending amounts during your entire retirement.
Matt McClure:
Yeah, and that's a good thing. This is a good way to sort of think about it. When I when I think about annuities, especially annuities versus life insurance, annuities protect you from living too long. Life insurance protects you from dying too soon. That's kind of the way that I sort of like to wrap my brain around those two things.
Mike Zeno:
Absolutely. And you can think of the the fixed index annuity as the new bond replacement. Research also has shown that the fire can outperform bonds and it makes them a sturdy, sturdy bond alternative. And especially in regards to interest rates being at such low levels, a fixed indexed annuity has the potential to be a better means to pursue yields and provide returns while also securing your principal balance. And another benefit is that even in the. Early years of your contract, they still allow for liquidity. You can get penalty free withdrawal access of up to 10% every single year, which means you have that liquidity should you need it.
Matt McClure:
Yeah. And this is why I love this show, Mike, because you're taking me to school and I'm learning stuff and that's fantastic. Hopefully the same is true for our listeners. I know it is just about time for us to take this break. One last one here before we close out the show in a few. But Money Matters with Mike is the name of the show, of course. Once again, Money Matters with Mike is the website and the number. If you want a free consultation, absolutely free and obligation free as well. 7045601573. That's 704560 1573. Stick around money matters with Mike will be right back.
Mike Zeno:
This land is your.
This land is mine. I'm from.
Matt McClure:
California. The weather is warm. Are you planning to use some of your hard earned money to get out of town? I'm Matt McClure with a retirement radio network powered by a metro life. Whether you prefer a trip to the mountains. Soaking up sun at the beach. For the thrills and chills of a theme park. There's a destination for pretty much anyone who's looking to travel over the summer. The consumer finance website, Wallethub, recently did a study ranking the top summer travel destinations. Orlando came out on top, followed by Washington, D.C. and Tampa, Florida. Austin, Texas. And Salt Lake City, Utah. Rounded out the top five. Wallethub analyst Jill Gonzalez.
Tara Sinclair:
The study was based on 43 metrics, including cheap flights, number of delays, hotel costs and COVID numbers.
Matt McClure:
In the meantime, inflation probably has you watching your budget more closely than before. So when considering travel costs and hassles, the website says Santa Rosa, California, is your best bet. At the other end of the spectrum, McAllen, Texas has the highest costs and most hassles. But what if you have your heart set on escaping to a specific destination and it's on the pricier side? There are ways to save no matter where you're headed. Travel expert Mark Ellwood recently told The Today show.
Matt McClure:
Before you do anything, if you were a member of a warehouse club like Sam's Club or Costco, go to their websites because they sell travel at a.
Mike Zeno:
Big discount. Brilliant. So that immediately you might find you could suddenly cut the price.
Matt McClure:
Of course, there are also travel websites like Expedia, Travelocity and Kayak, just to name a few. But if you're looking for discounts specifically geared toward retirees, the senior list has a pretty extensive directory of them, including which airlines, hotels, cruise lines and rental car companies give discounts to those over a certain age. So how can you head away for a warm weather vacation without breaking the bank? That's a key question to consider as you keep a close eye on your budget with the retirement radio network powered by a mirror life, I'm Matt McClure. Fixed annuities, including multi-year guaranteed rate annuities, are not designed for short term 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.
Mike Zeno:
When I get older, losing.
Speaker5:
My hair many years from now.
Matt McClure:
Welcome back. This is Money Matters with Mike. I am Matt McClure here alongside the one and only Mike Zeno. Money Matters with Mike Dotcom is the website and if you want a free consultation or just to learn anything about any of that stuff we've been talking about today, some more information about all of these different money matters with Mike, of course, 740 560 1573 that's 7045601573 is the number. Now, Mike, we've been talking a lot about, of course, retirement planning, planning for the future and what you would do if you were the listener or if you were me during today's environment. There's a lot of things that we need to talk about, though, with our listeners with regard to to efficiency. You know, and there are several different ways that you can be efficient in your planning, right?
Mike Zeno:
Absolutely. And we talk about the big efficiency topic these days is fuel efficiency and especially coming into this weekend where people are doing traveling. I saw a USA Today statistic that said this 4th of July weekend will experience the most highway travel since 2011. And I'm thinking, wow, that's that's a long time. That means everybody is going to be on the road, which means you need to and I'm talking to myself, Mike Zeno, bring your patient pants. When you're stuck in when you're stuck in traffic, just need to be a little bit more patient. But when it comes to your retirement, there are a few efficiencies. You definitely want to make sure that you have. Number one, it's very, very important to be fee efficient. And so I'm going to urge you to not pay fees on the bonds that you hold. You can generate more income with the fixed indexed annuity for that portion of your portfolio and you'll pay no fees. I don't want you overpaying for an underperforming asset. The other thing with fees is if you have a relationship with an advisor, you might take a look at the fee structure that you're currently under. And if they seem a little egregious to you, come talk to me. So fee efficient. Number one, you definitely want to be fee efficient in retirement.
Mike Zeno:
Market efficient, what does that mean? Well, we want to have you eliminate risk by moving some of your money out of the market and into that fixed indexed annuity. Why? Well, it offers you market linked gains, but without any of the market risk. And again, you could take money out of the market and put it into a bank account, put it into a CD, put into a money market account. But all of those things are subjected to inflation risk because with the rate of inflation, as we've already discussed, that would not be the best option for you. Alternatively, speaking, in a fixed indexed annuity, being able to capitalize on those gains without experiencing any of the losses makes a lot of sense to me. And then we also discuss taxes. And so if we think taxes are going up in the future, you definitely want to be tax efficient. We like to say divest the IRS. In other words, strip them of all of their power. Pay your fair share of taxes, but nothing more. Have a tax plan and consider implementing both life insurance as well as the Roth IRA if you don't already have them to your overall financial and retirement plan.
Matt McClure:
Yeah, absolutely. Don't pay more than you have to. And that's the goal. There should be the goal. Don't you know, obviously pay as you say, what you what you owe, pay those obligations as we all have to. But then don't get yourself in a situation where you're looking at a higher tax bill than you need to be paying. I think that would do good not only for the wallet, but for the for the nerves and and for your state of well-being in your mind also.
Mike Zeno:
Absolutely. Another thing talking about the mind is you need to invest with income in mind. And a lot of people, again, think that they just get to this one magic number. It's going to solve all of their problems. But retirement is more about income and cash flow than it is about building up one giant nest egg. And I guess one of the biggest mistakes that I see a lot of folks making when they come in and talk to me and they bring in their IRAs and their tax deferred retirement plans is they say, look how much money I have. And when we get to the portion of our meeting where I say. You mean you and your uncle have they kind of look at me with this somber look when the realization hits them in the forehead like a brick, that all of that money they have in those tax deferred accounts is not all of their own money. Uncle Sam has not received his cut yet, and we've been told that taxes are going to go up in the future. And so that's why we encourage people to budget, to spend wisely, to track every dollar they spend, know where it's going, and consider implementing a fixed in fixed index annuity to protect and grow their wealth. Should you need income, you can be provided with an income that you can never outlive.
Matt McClure:
Yeah, and that is reassuring to say the least. I think to everybody is that, you know, if you have that in place, knowing that you cannot outlive that income, it just gives you such, such peace of mind here. You know, we've been we've been talking throughout the show, Mike, about, you know, that initial consultation. Right. No obligation, completely free consultation about people looking at their particular situation. Talk a little bit here and we've got just a few minutes left in the show, but what is that initial consultation? What does it look like?
Mike Zeno:
So I like to call it a discovery call and really that's what it is. I want to find out more about you. And during our initial consultation, I'm going to seek to find the answers to certain questions. What does a successful retirement look like to you? What are you doing and who are you doing it with? What are you looking to accomplish? Do you have any specific goals? How do you plan on funding that retirement? Because here's one thing I see. A lot of people have plans on traveling. Well, traveling pulling a camper requires a different capital investment than flying first class and staying at the Four Seasons and eating the finest foods. Right. So let's dig into what travel means to you. And then again, how do you plan to create income every single month? Because I say it and I say it and I say it in retirement. It's not about how much money you have, but how much money you have left over after paying all of your income or excuse me, your expenses. So it's what you have left over that counts and allows you the freedom to be able to do what you want and to the extent that you want. And that should be everybody's goal to be able to do what they want and to the extent they want and not have to worry if it is in the budget for that particular month. And so with proper prior planning, we can actually put something together that enables you to reach your destination.
Matt McClure:
Of course, if you want that free consultation or just to find out more information about any of the stuff that we've been talking about on the show today. Remember that number 704560, 1573, that's 745601573. Money matters with Buy.com is the website. And of course, you can find all the information there, see past episodes of the show or here, past episodes of the show, I should say, and get all kinds of great information and and get in contact with Mike and find out more about your financial future and what it could look like. And just in the last couple of minutes that we have here, Mike, of course, as we know, as we've been talking about, this is Independence Day weekend, 4th of July, just around the corner. And I just wanted to say something really quick about about my dad, because he was a Vietnam veteran and loved loved this country more than just about anything other than his family. It was always family first for him, but he just passed away this year. It was 81 years old and passed away in the hospital back in January. And every time I think about this weekend, this 4th of July weekend, I think about how it was one of his favorites because he got to spend it honoring the country and spending time with his family.
Matt McClure:
And so it's like his two favorite things, you know, coming together and being, you know, front and center for that particular weekend, that particular holiday. So I just want to kind of thank my my dad for his service to this country. He served in the Air Force in Vietnam. And, you know, for his his sacrifice that he made and a lot of other folks sacrificed a lot as well, obviously, but just been thinking a lot going into this. Very patriotic. Weekend about my my very patriotic dad, who unfortunately is no longer with us, but is will always be with us as long as we remember him. And that's what I've been telling myself these last few months as we've been remembering him constantly. So just on a very personal note there, and I know, Mike, that you are, of course, a veteran. We always talk about your business being a veteran owned business. You are the owner, so you are the veteran that we're talking about. So thank you for your service as well, buddy.
Mike Zeno:
I appreciate that. It was my absolute pleasure to serve in the United States Army. I also come from a long line and a lineage of service to this great country. My dad was also in Vietnam. My grandfather served in Korea. And so we always try to stand up and protect those less fortunate. And if we harken back to 1776 and when we broke away from that oppression and formed this great country, the United States of America, this is definitely a weekend to celebrate. And so while you're on the road and you're visiting with family and you're eating all of that good food, just just take a minute to understand and appreciate those who did give that ultimate sacrifice. And I know we just had Memorial Day, and that's where we remember those veterans that gave all. But this is another place that I like to just pay homage to those who who have served and have sworn to defend the Constitution of America against all enemies, both foreign and domestic. So, Matt, I thank you for your dad's service and all of the veterans out there who have served. Thank you for your service. Just be careful this weekend. Enjoy the weekend. And as always, make it a great day.
Matt McClure:
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 and does not provide a guarantee or a specific result. All copyrights and trademarks are the property of their respective owners. Amaro Life assumes no responsibility or liability for the content of this message. The information contained herein is provided on an as is basis with no guarantees of completeness, accuracy, usefulness, timeliness or the results obtained from the use of this information.
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