Remember those New Year’s resolutions you made to start 2024? How are they going for you these days? This week, Mike has some things you can do to give yourself a financial checkup as we approach the halfway point of the year. Plus, he has an update on Social Security and when its trust funds may run out of money. And he discusses the details of different types of annuities so you can determine which may be best for you.
Call Mike Zaino today at (704) 560-1573
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6.21.24: Audio automatically transcribed by Sonix
6.21.24: this mp3 audio file was automatically transcribed by Sonix with the best speech-to-text algorithms. This transcript may contain errors.
Speaker1:
Welcome to Nationwide's Peak ten fixed indexed annuity, designed to help provide guaranteed income for life. Peak ten offers protection against market losses, plus protection for a spouse through a joint option and an immediate 10% penalty free withdrawal. Call us now at (704) 560-1573. That's (700) 456-0157 three. Guarantees and protections referenced within are subject to the claims paying ability of nationwide life and annuity insurance company nationwide. Peak ten is issued by Nationwide Life and Annuity Insurance Company. Columbus, Ohio.
Speaker2:
Any examples used are for illustrative purposes only, and do not take into account your particular investment objectives, financial situation or needs and may not be suitable for all investors. It is not intended to predict the performance of any specific investment, and is not a solicitation or recommendation of any investment strategy.
Speaker1:
Welcome to Money Matters with Mike, with your host, Mike Zeno. Get set for a full hour of financial information and economic news affecting your bottom line. Mike works hard each day to educate Americans like you on how to reach the financial freedom they've worked so hard for, and he can help you too. So now let's start the show. Here's Mike Zeno.
Speaker3:
What's up, what's up, what's up? It's Mike Zeno coming to you from Fort Mill, South Carolina. Happy Saturday people. What a great time to be alive in these United States of America. Money matters with Mike is a show designed to arm you with information and give you plenty of meat on the bone to chew on each and every week. And today we are absolutely bringing the heat again. On today's show, we're going to talk about some mid-year money moves to help protect and grow your money, plus some important Social Security updates to be aware of. As always, I have the distinct honor and privilege of being joined by the one and only my producer and co-host extraordinaire, Mr. Matt McClure. Matthew, how are you today, sir?
Speaker2:
I'm doing great, Mike, I really am. Am glad to be joining you this week. Not only just because, you know, I enjoy joining you each and every week, but because it means I get to be inside in the air conditioning because it has just been hot as blue blazes outside.
Speaker3:
Yes, yes. My wife often says it's hotter than the hinges on the back gates of hell. So, um, it is approaching that status, although, you know, other areas of the country have it a little worse than we do. So, you know, I'm thankful that we were not in triple digits quite yet, but, uh, it feels that way when you go outside.
Speaker2:
That's right. Absolutely. But as you always say, you know, we're bringing the heat in a good way. Uh, here on the show, discussing those mid-year money moves to make and, uh, you know, being able to protect and grow your money. So that is what we're going to focus on for this hour of the show. And a big shout out to our listeners, uh, here in the Charlotte metro area or wherever you might be listening to the show today. You know, of course, we're available as a podcast anywhere you subscribe to podcasts, you can find Money Matters with Mike. Just search for the show on whatever platform you're on. And, uh, of course, as well you can get the episodes on our website. That's Money Matters with mike.com. You can go to the YouTube channel, check out some video highlights there and some special content as well. Just go to YouTube again, search for Money Matters with Mike or go to the website Money Matters with mike.com or call Mike at (704) 560-1573. That's (704) 560-1573. The bottom line is, Mike Zeno would love to interact with you in whatever way that you want. I mean, you can you can send a carrier pigeon smoke signals, whatever. He just wants to get in touch with you or for you to reach out and get in touch with him. That's that's pretty much what it boils down to, right, Mike?
Speaker3:
Absolutely. Matt. You know, I love meeting with clients and and discussing how we can help you reach your financial goals and whether that's with retirement planning, whether it's with risk management, estate planning or anything else retirement related building sound financial plans for listeners. Okay, is what I do best. So, you know, don't hesitate to pick up a phone, reach out on the web. Reach out on social however you want to get out. Uh, get me. Let's, uh, let's get you going to a safe and secure financial future.
Speaker2:
Absolutely. And that number, once again, if you would like to go, the phone route is 704 5601573. A lot of great stuff to come here on the show. Uh, as you said, Mike. So mid-year money moves to make. We'll share that checklist in just a bit to keep you on the right track toward retirement. We'll also have some important Social Security updates here, keeping you informed as the program faces some some troubles ahead and what could potentially be done to alleviate those troubles. Um, remember, June is Annuity Awareness Month, and we're going to continue our, uh, sort of series speaking about that here. And not all new annuities are created equal. They are not all bad, despite what you might have heard out there. And we're going to talk about which 1st May be right for you. We'll kind of explain the differences between some different types here. We'll have an inflation demonstration and how it's impacting the overall economy. And we'll look at the world's oldest astronaut in our new segment, the retiree of the week. But first, let's get some inspiration for all of these conversations we're going to have. And we'll do that with our quote of the week.
Speaker4:
And now for some financial wisdom. It's time for the quote of the week.
Speaker2:
And this week's quote comes from a very interesting gentleman named Joe Girard was an American salesman, motivational speaker, and author. His big claim to fame here he sold 13,001 cars at a Chevy dealership between 1963 and 1978, and that made him get recognized by the Guinness Book of World Records as the seller of the most cars in a year. I mean, that is kind of crazy, uh, some, some crazy numbers that we're looking at there. Well, Joe Girard, he said this. The elevator to success is out of order. You'll have to use the stairs one step at a time. Love it.
Speaker3:
I love that, too. And you know the fact that he sold Chevy's my grandfather. May he rest in peace. Sold Chevrolets for 33 years and was in what they call the Legion of leaders every year for each of those 33 years. So I think that, uh, oh, uh, grandpa, there pa trovato may have, may have been number two to Joe Girard.
Speaker1:
Hungry for something to chew on. Here's some meat on the bone.
Speaker3:
You know, when you look at his quote, I think it basically is saying that there is no quick and easy way to achieve any type of success. And the fact of the matter is that you have to work for it gradually. And so if you kind of relate that to retirement planning, think of success as having enough money to be able to enjoy your golden years. And that elevator that he's talking about would be like winning the lottery, or finding some magical investment that makes you rich overnight. Unfortunately, that elevator is broken. You just can't zoom to up to the top and be done with it. Instead, you have to take the stairs, which means that you save money bit by bit, little by little. Make smart investment choices, plan carefully over time. And just like taking the stairs can be tiring, but in fact it gets you fit. Um. The step by step approach helps you build up your financial health, so every step that you take brings you comfortable or closer, I should say, to a more comfortable retirement. So three examples of basically how to get financially fit for retirement. Number one, start saving early. Okay. Just like taking that very first step on a staircase, start putting away a little bit of money. Now while you're young, every every amount, even small amounts grow over time. Um, number two would be to your budget wisely. And we like to call it a spending plan.
Speaker3:
Keep an eye on your spending and make sure that you're living within your means. Okay? If you spend all of your money on fancy coffee, you might not have enough for the essentials down the road. Just imagine trying to climb stairs in high heels. Um, it's not going to end well, so stick to comfortable shoes or in this case, a sensible spending plan. And then number three is to just invest smartly. Please do not put all of your money under the mattress. It just simply won't grow there. Okay. Look into different types of retirement accounts, whether those are 401 403 BS. Uh, the Thrift Savings Plan, if you're a federal employee IRAs. It's like adding a little bit of rocket boost. All right. To your climb a little, uh, play on the astronaut that we're going to feature later. You'll get higher, much faster. And just be sure to spread your money around, though, into different investments to help reduce risks. Things like stocks, things like annuities, things like real estate, for example. It's kind of like packing a well-balanced lunch to take to work that has fruits, vegetables, and maybe a cookie later for fun. Right? And so by taking those small steps regularly, you'll definitely get closer to your retirement goals without needing any quick fixes. Okay, remember, slow and steady wins the race or in this case, a much more comfortable retirement.
Speaker2:
Hey, there you go. I love that they're bringing a little tortoise, tortoise and the hare into it as well. Um, and yeah, no, I mean, it really is true that, you know, could you wake up tomorrow and win the lottery? Yeah, absolutely. You know, could you, um, you know, get go to, uh, Cherokee and hit a big jackpot? Yeah. You could. The odds of that happening are so teeny, teeny, teeny tiny. Um, that's not what you want to bank on for your future success. So you've got to make that happen. You've got to take those steps that you just outlined there, Mike, to, to get yourself along that path. Um, because it's so super rare that anybody. Hits it big just in an instant like that.
Speaker3:
Yeah. I mean, you're more likely to get struck by lightning not once, but twice than to win the lottery. So I would much rather be able to know that. Hey, you know what? I can save 50 bucks a pay period. I can save 100 bucks a pay period. Heck, I can save, you know, $2,000 a pay period. Obviously, that's going to depend on how much you make per pay period. But if you get into the habit of doing that often and you're diligent and you remain disciplined throughout the entirety of your working career, you're going to have a nice little nest egg by the time you come to retirement.
Speaker2:
Yeah, absolutely. Ah, and if you want any help, of course, along that road, folks getting started taking those steps one at a time. You can reach out to Mike Zeno. He'll help you along the way. He'll give you a helping hand up that staircase. Money matters with Mike comm. You can go there and reach out. That's money matters with mike.com. Or call him 704 5601573.
Speaker1:
It's time for this week's Problem Solver. Our.
Speaker2:
So yes, it is time for the portion of the show where I, as I so often do, present a problem. And Mike Zeno solves said problem. Um, and this one is in honor of Annuity Awareness Month, which is this month, the month of June. And this time around, we want to focus on making sure that you are investing in the right annuity. Because here's our problem, Mike. Many people own variable annuities that they just don't understand, right? Their their principal is at risk in the stock market. They're paying something like three to even 6% in fees. They're also paying, you know, income writer fees as well just to have their money paid back to them. So that's a big problem. It seems like what is the solution?
Speaker3:
Yeah, I mean I think the solution is, is just to consider a different type of annuity that helps better protect as well as grow your hard earned wealth. Okay. And we believe that your money should be working as hard for you as you worked for it. And so one of our favorite types of annuities, especially for income in retirement, if you need to replace a lot of income that you're no longer getting from a job, that you're retiring from, a fixed indexed annuity can both protect as well as grow your wealth. And so, you know, we've used this analogy before, kind of like Goldilocks and the Three Bears. We compare different types of annuities to the way Goldilocks compared her. You know, porridge okay. Um, variable annuities and these tend to be too hot. Okay. They're in the market. They're at risk. There are lots of fees, you know, that are involved with them. And when I say at risk, that means, folks, you can lose money. The word variable means change, not, uh, in a good way. If the market goes down, especially in retirement, a fixed annuity is too cold. It's kind of like a bank CD. You, you know, it's not beating inflation in most cases. It has extremely low interest rates. All right. But then a fixed indexed annuity is just right. And so you know as far as how that benefits our clients. You you can purchase an annuity by either rolling over, uh, a 401 K or a 403 B or an IRA. Or if you have a lot of money just sitting in a bank account doing nothing for you, or if that money is under, uh, your bed, under your mattress, so to speak, or in a safe, you can just write a check to purchase the annuity.
Speaker3:
The annuity then participates in an underlying market index. So your money's not exposed to the market, but it's indexed to the market so that when the market goes up you enjoy market linked gains reasonable rates of growth. But here's the you know, the the the number one reason why people love the fixed indexed annuity. Once the market has some volatility involved and starts going down, your money is protected. You don't lose a single penny. The worst you can do is zero one. Everybody else is losing money. Who is exposed to that market volatility. Zero becomes your hero. And then when the market picks back up right from its low point because you didn't lose anything, you're already ahead of the game. So that when it picks back up, it's picking back up from where it flatlined and lets you grow from there. They can be set up for growth. They can be set up for income, they can be set up for a combination of growth for a few years and then income. And when I say income, I'm talking about guaranteed lifetime income that lasts you for the rest of your life, no matter how long you live. And then once you eventually do become room temperature, because that's one thing we are all guaranteed the money that is left in the account. Guess what folks? That goes to your named beneficiaries. Okay, these are not the annuities of old where the company kept your money and you disinherited your family. These are the annuities of new which offer just a whole robust suite of very, very nice benefits.
Speaker2:
Yeah, they're not created the same as they used to be these days. And, you know, you talked about creating an income stream with a fixed indexed annuity. And that's one of the things that we talk about as well is, you know, if you are someone who finds yourself in a situation where you get to retirement and you're going to have an income gap, so you've got more month than money instead of the other way around, right? Those annuities, those types of products, a fixed indexed annuity can actually help fill those holes in your plan, right?
Speaker3:
No doubt about it. I mean, I sit down with people every single day who are making good money anywhere from, you know, 50 grand a year to, you know, 250 grand a year. And the fact of the matter is, when they leave that job, that income is no longer there. And so those. Folks have to rely on the typical what we call three legged stool. You know, the first leg, if they are fortunate enough to have one, would be a pension. Uh, well, only 13.5% of American workers have a pension, so that could be a pretty wobbly start to most people's retirement. The second leg would be Social Security, and then the third leg would be whatever savings they have amassed in a employer sponsored plan, like a 401 K or in an individual retirement account like an IRA. So the fact of the matter is, if you have done a good enough job, we can show you how to replace the income so that you don't skip a beat going into retirement. And more often than not, I'm able to show people how they can make more money retired than they were when they were working. And that, my friends, is a great scenario to be in.
Speaker2:
It absolutely is. I mean, you know, I, you know, like I don't have to go to the office five days a week and, you know, do all of the things or, you know, whatever it is that you do, the factory, the wherever you go. I don't have to do all that. But I still get paid and get paid more than what I was doing when I was working. That is amazing. And it really, you know, sort of gives a lot of comfort to a lot of people. According to this, uh, NHP Foundation study here, 62% of baby boomers believe that Social Security will provide at least half of their income during retirement. But the thing is, Mike, that's not really going to be enough to be able to maintain your standard of living. So that's where a lot of that, you know, income gap is going to come from. Because if you're relying strictly on Social Security, you're going to find yourself with a gap.
Speaker3:
You are definitely going to find yourself in a gap. I mean, the average monthly benefit at age 62 is only $1,542. Um, the maximum that you can draw at age 62 is $2,364, and the most you can make at age 70 is just under $4,200 at 4194. So, I mean, if you want to work until age 70, most people don't. Um, that would obviously help you in your financial, um, situation as far as monthly cash flow is concerned. But if you're depending on Social Security alone, you're just missing the boat because there are steps that you can take well in advance that will help prepare you for a much more financially secure retirement. And, you know, I can show you those at each step along the way if you wait until it's too late, right. It's a plan. Then you've made the bed. We can make it as comfortable for you as possible, but there's only so much we can do. So I implore our listeners, stop procrastinating. Stop putting off until tomorrow, throwing it in the drawer in the kitchen and closing it, and then opening it five years later saying, man, I meant to do that. Meanwhile, five years has gone by. And folks, five years is a long time when you consider the power of compound interest, especially if those five years happen in your 20s or 30s.
Speaker2:
Yeah, absolutely. Right. Because, you know, I'm, you know, sitting here now in my 40s and thinking, oh, gosh, I wish that I had started saving back in my 20s and in my 30s. I wish that I had made that a priority. So if you are within the sound of our voices right now and that is the situation you find yourself in, uh, take it from us, make it a priority. Because the longer you have, the longer your time horizon, the more that interest will compound and you'll be earning interest on top of interest. And it will just grow like a, like a snowball going downhill. I mean, it really will benefit you quite a bit in your future.
Speaker5:
Mhm.
Speaker2:
Well, 76% of retirees, you know, say that income stability is a top concern for their retirement as well Mike. And you know, talk about the um, the fact that, you know, people might be listening and say, okay, well how do I know if I'm going to have a retirement income gap? What is the calculation there? I mean, because obviously it's something people care about. More than two thirds say that they want income stability, but they don't want it to be an income that falls short of their obligations, obviously.
Speaker3:
Yeah. I mean, no doubt about it. I mean, nobody wants to retire and have to live off of government cheese, right? I've said that before. And and for those that do live off of government cheese, there's nothing wrong with that. But if you can put things in place before you get to that point, you won't have to. That's the point that I'm making. So when we're talking about the income instability, we just mean, you know, hey, I'm used to making this and now in retirement, I've got to take such a hit because I'm not making the money that I used to be making. So we're talking about core expenses. Things like food, clothing, shelter, taxes, health care and any other needs that you might have. And then we're going to add all of your discretionary expenses, things like eating out, right. Some entertainment things that you want to do that make. Tired, but actually enjoyable. All right. And then you got to look at the different guaranteed income sources that you have. If you don't have a pension, well then the only guaranteed income source that you have is going to be to rely on Social Security and any money that you've managed to save. So when you look at all of those things, add them up and subtract. Then that is either going to give you an income gap in retirement or hopefully again, with proper prior planning, you'll have an income surplus and actually make more money in retirement than you were while working.
Speaker2:
Yeah, 100%. And you know, we already mentioned, you know, using fixed indexed annuities as part of a strategy to fill that retirement income gap. Um, also a couple other things I think to mention too here, Mike, but because, you know, that's that that's one strategy, I think, of a multi-pronged kind of a thing that people need to take into account. Right?
Speaker3:
No, 100%. So, you know, I love to see people suffer during their high income earning years. And I'm saying that with a grain of salt, right? When you're in your 50s especially, and you're making more money than you've ever made before, 50s and 60s, I want to see you show me. Just basically shuffle that into the, uh, into the retirement accounts and start stacking paper for your future self. Okay? Suffer a little bit while you have all that extra money. Don't splurge on, you know, impressing the Joneses and buying things that you don't even really want or need just to impress people that you don't really like anyway, right? Instead, save that for your future self. Then another thing that you may consider doing is delaying turning on your Social Security benefits, because every year you delay, you're guaranteeing yourself roughly an 8% compound return. Which may not sound too sexy, but trust me, it adds up. And then the third thing, obviously, is to consider investing in an annuity to help establish yet another guaranteed income stream that you can never outlive. So the happiest retirees have many different sources of income coming to them on a guaranteed basis in retirement. Just think, if you could, you know, just bank on it, like take it to the bank literally that on this day, every single month, just like clockwork, you are getting paid and those deposits are hitting every single month. That just gives you a certain sense of confidence. And you walk a little bit taller with your shoulders rolled back.
Speaker2:
Yeah, you're 100%. And get that peace of mind, which, as we always say, cannot you cannot put a price on that. And, uh, of course, folks, if you want to take advantage of any of the things that we are talking about here on the show so far, uh, reducing risk in your portfolio, establishing a personal pension that creates a lifetime income stream. Mike Zeno can help you with that. It's it's one simple strategy, but you got to know you got to do it, right? Right. So you got to go to somebody who knows what in the world he's talking about. And I know a guy. His name is Mike Zeno, and you can go to Money Matters with Mike comm. Money matters with Mike comm. That's the website. Or give him a call 7045601573704560 1573 and make sure to to tune in to the show each and every week this month to learn all about how annuities can empower your retirement. Well, all right, so we just mentioned Social Security a moment ago, Mike. So, uh, got a nice little segue here into this next segment because we want to really help our listeners stay informed about the future and potential upcoming changes regarding Social Security, with some key updates here, some recent discussions, recent proposals. And the first thing that we want to talk about are the dates. Now that they say that the funds are going to be depleted, um, they've gotten a little bit of a of a lifeline, right?
Speaker5:
Yeah, just a little.
Speaker3:
Bit of a reprieve. It used to be 2034. Okay. It is now the combined trust funds for Social Security, the date that they are projecting them to be depleted is by the year 2035, which means that only about 83% of the benefits are going to be able to be paid, which again, that is a little bit better than what they were um, predicting first. Okay. And specifically, the trust fund for the retirement benefits is expected to actually run out a little bit sooner by the year 2033, which could result in only 79% of those benefits being paid out. So I think that is very, very important for folks to understand. But, you know, there are several congressional actions and proposals that are, you know, being brought up by our members of Congress to head that off and to kind of make sure that that doesn't. Happen. So a bipartisan commission proposal, um, was was just recently made where a bill has been proposed that creates this bipartisan commission. And that commission is aimed at addressing long term fiscal issues of the federal government, which obviously would include Social Security. It's like they have a committee about a committee about a committee.
Speaker3:
It always, uh, always cracks me up how many committees they have. But apparently this commission would provide policy recommendations and could get expedited consideration from our United States Congress. So critics argue, though, that this approach might lead to benefit cuts and lax, uh, or lack of transparency, I should say, due to that closed door nature of those negotiations. Um, so that's, you know, that's one thing that they're trying to do as a, you know, put together this bipartisan commission. And then, you know, there's another thing that's called the Social Security 2100 act that was proposed by Representative John Larson, which that act aims to improve the program's solvency as well as expand benefits through. Guess what, folks, tax increases on the wealthy. And that always kind of makes me chuckle, because if you think it's only on the wealthy, wake up America, all right? If the wealthy get taxed, it's going to trickle down and affect everybody. So, um, those are a couple of things that they're doing right now to try to head it off, um, and make some preemptive changes.
Speaker2:
Yeah, I've cracked me up a second ago, Mike, when you were mentioning a committee about a committee and all that, I it just made me think, uh, you know, I grew up, I grew up Baptist, and I was like, well, they must all be Baptists, because that's what we owe. You wanted to move a pew one foot. Well, let's appoint a committee to talk about it. Um, that's just kind of how it went. So I think they must all be Baptist up there.
Speaker5:
Yep.
Speaker2:
Well, um, there are some public opinion numbers here to look at as well. An AARP poll found recently, 89% of Americans believe that Congress should act immediately to ensure full benefits for current and future beneficiaries, and 90% do support bipartisan efforts to find a solution. So people want a solution. They want parties to work together to find a solution. Um, but, you know, it's it's like pulling teeth to actually get people to, you know, stop yelling at each other for about five minutes and do anything in DC these days.
Speaker3:
You know, it's sad. Or the state, the state of America in today's political environment is is just just replete with division, right? Divisiveness. And and it didn't used to be that way. You used to be able to agree to disagree and you'd still work forward for, you know, for a for a common cause. Right. Well, we have some pretty serious issues facing, you know, our, our financial landscape for our senior, uh, retirees in America, things like, you know, Social Security, things like Medicare, these are two government type sponsored programs that need help. And so, um, if you out there are concerned about either of those, we understand that you're worried, right. And how future cuts, whether it's to Social Security or Medicare, are going to affect your retirement. And so to kind of put your mind at ease, we want to provide you with a maximization plan that is customized with both you and if you're married, your spouse's benefit information um, within so that you can have a little bit more confidence going into, uh, those those years where you're relying on both Social Security and Medicare.
Speaker5:
Yeah.
Speaker2:
And knowledge is power, right. So get that, um, knowledge, get that education so that you can make an informed decision. Just go to money matters with Mic.com. That's money matters with Mike. Com or call (704) 560-1573. All right Mike. Well, this next section of the show we're going to talk about those mid-year money moves that we, uh, have have been kind of teasing here so far. And, you know, it's kind of weird to think that it's the middle of the year already. It seems like it was just the holidays, uh, not all that long ago. Um, but, I mean, you know, one step, as we were saying at the beginning of the show, one step outside, you'll know it's the middle of the year with the heat that we've been experiencing. Um, no doubt, but some smart steps here to strengthen your finances. And it starts with really a holistic financial review.
Speaker3:
Yeah, it does. And the whole reason that money matters with Mike is providing mid-year money moves a little alliteration. There is like a lot of people like to set those New Year's resolutions, and those often include goals for their personal finances and their retirement savings. Okay, so it is important to track your progress toward those goals. And as you approach halfway through the year of 2024, here are some smart steps that will definitely help strengthen your finances. Make sure that you are on the right track. Okay, first thing you want to do, review your cash flow. Below, examine the money that comes in, and then examine the money that goes out of each and every single one of your accounts. You need to ensure that your income exceeds your expenses so that you avoid dipping into your savings or you, God forbid, accrued debt, right? If possible, you want to try to eliminate as much, if not all, debt, including your home mortgage, prior to retirement. So even if you do still have a mortgage in retirement, expense can consume one of your two Social Security payments coming into a household if you're married or sometimes your entire Social Security income if you are single. So you have to be mindful of that, right? The second thing you want to do is focus on those high interest rates.
Speaker3:
Rates right now are at 20 year highs. So you need to prioritize paying down all of your higher interest debt, especially those credit card balances. Okay. And consider taking advantage of the high interest rate environment. And then explore the benefits of the fixed indexed annuity, which can help counteract those high interest payments that you're making by offering you more lucrative rates, offering more lucrative rates. Okay. And features while the interest rates are actually high okay. That's number two. Number three, we want to boost your emergency savings and your retirement savings. So that's kind of two things. In one, you need to aim. I like people to have a minimum of six months worth of living expenses in an emergency fund. And that's for folks with a pension. If you don't have a pension, I want you to try to go to 12 months. If you have that in an emergency fund, maximizing that money just again gives you the peace of mind, knowing you never have to worry about how in the world you're going to pay for your HVAC unit breaking in this heat because it's being strained. All right? You don't have to worry about your water heater exploding on you. You don't have to worry about your car.
Speaker3:
Well, that's not under warranty. Dropping a transmission because you have money for the unexpected. Okay. Maximize your contributions to your retirement accounts as well. So those are 401 KS, your IRAs, any type of retirement savings vehicle, and ensure you're taking full advantage of employer matches as well as those tax benefits. If you find yourself contributing to a tax deferred type of an account and then tackle your taxes early, okay, there is no reason that you have to wait all the way until the end of April or middle of April. Rather to do your taxes. You can actually use an IRS tax withholding calculator to help ensure the correct tax amount is being withheld from your paycheck. That way there are no unpleasant surprises during tax time. Um, if you're somebody that has to make advanced quarterly estimated tax payments, make sure those are adequate, all right, so that you don't have to pay penalties for underpaying your quarterly taxes. And then there are things like considering doing a Roth conversion or saving into a Roth IRA to help delete future taxes from your retirement. And so a Roth is one of the only two types of tax free, uh, investments. And so I suggest that people take advantage of those as well. Matt.
Speaker2:
Yeah, 100%. And then, you know, you also want to make sure that you you have protection in place for your assets. You know, you want you want as much, especially the closer you get to retirement. You want more protection, right? So protect your assets and make sure that you have the right insurance policies in place.
Speaker3:
Yeah. I mean, whether that's health insurance, life insurance, disability insurance, homeowners insurance, as well as auto insurance, let's face it, nobody likes paying insurance premium until they need the insurance. Right? But, you know, I got into a fender bender not too long ago down in Atlanta. A guy pulled out and then decided to stop. And I just give him a little love tap, right. Well, thank God I had insurance because that that fix on my the front end of my truck, uh, because of the sensors and everything that's in there was over $12,000 for a little love tap. And I'm like, wow, I'm sure I'm glad I had that insurance to cover that. Right. Um, you know, I've shared before that I had a kidney transplant back in 2020. Well, I had health insurance, and if I didn't have health insurance, that would have cost me a lot of money because my wife ended up being a perfect match and was my donor. Well, what does that mean? That's two operations I would have had to pay. For. We're talking probably in the area of two, $2.5 million. I'm never going to complain about paying a health insurance premium again, all right, because it was there when I needed it. So protect your assets is very, very important. And then, you know, take it a step beyond seek professional advice, okay. Consider consulting with a financial professional that will help tailor your financial plan to your specific needs, to your specific goals, your desires, your wants. And everybody is different, folks. And so we can actually do that for each and every single one of our listeners with a complimentary consultation as well as comprehensive retirement plan. And all you have to do is contact 704 5601573 or go to Money Matters with Mike comm and that'll help you get booked. Get started and we'll help you reach your retirement goals.
Speaker2:
And once again folks, that number 704 5601573. Or you can go online to Money Matters with Mike comm.
Speaker1:
Want to know where your hard earned money is going. It's time for an inflation demonstration.
Speaker2:
So this week we're kind of, you know, taking a slightly different tack in our inflation demonstration and kind of doing a bit of an explainer here, understanding the impact that inflation has on your money day to day. So let's start tackling this, Mike. Kind of from the beginning here, which if you've ever seen The Sound of Music, we'll start at the very beginning. It's a very good place to start. And the cause of inflation is what we're going to start with now. So what is the cause of inflation without going, I guess without spending the rest of our hour and going into the next.
Speaker5:
Hour, about how long.
Speaker3:
Do we have, man?
Speaker5:
Oh.
Speaker3:
So I mean, inflation is primarily caused by an imbalance of supply and demand. All right. Any time there's a disruption in supply, whether it's due to a pandemic like Covid, think back when all of those tankers were off the coast of California. None of those tankers could offload their goods into the United States. They just sat there. Okay. Um, because without that supply, the demand has increased, which means that the prices get run up. Geopolitical events like Russia's invasion of the Ukraine. Right. That can definitely cause inflation to get higher, as well as expectations of future inflation. And so, you know, all of those things combined can help, uh, provide that imbalance of supply and demand.
Speaker2:
Yeah. And that is what leads to inflation. And that is also then what leads to your purchasing power just really being eroded.
Speaker3:
Right? I mean, it reduces the value of your money, which means that you can actually buy less with the same amount of money over time. So when people earn the exact same amount of money on wages, but the wages don't keep up with the rising cost of living, it puts them in a precarious situation.
Speaker5:
Yeah, and.
Speaker2:
It's not a place that you want to find yourself in. And then also, you know, it's kind of like, um, a vicious cycle as well when you get inflation kind of going. And we've definitely seen that here over the past couple of years with inflation getting as high as, you know, upwards of 10% year over year at one point. Um, you know, it really kind of just feeds on itself. It's this big monster that feeds on itself.
Speaker3:
Yeah, it's it's kind of like a wage price spiral where expectations of future inflation leads to higher wages and higher prices, which further just fuels that inflationary, you know, environment. And so, you know, another thing it does is raise interest rates okay. So to combat inflation the central banks may decide to raise interest rates which means it makes borrowing money much more expensive. And the whole goal with them doing that is to slow down the economic growth, which could also have a flip side repercussion of the fact that it can actually cause a recession because if not managed properly, those high inflation rates can lead to economic downturns, as the central banks and the fed aggressively raise rates to curb inflation. We we actually saw that a couple of years ago when the fed raised rates, uh, not once, not twice, but six times during one year.
Speaker5:
Yeah.
Speaker2:
And that, uh, definitely caused, um, you know, just a big upheaval in a lot of different aspects of the economy, a lot of different markets out there, particularly, you know, big ticket items, real estate, cars and all of that. People are just paying more for it. The good side, though, of the higher interest rates is, of course, those interest, uh, bearing accounts like you have, uh, you know, your, um, annuities that we were talking about earlier, the interest rates are higher there. So at least you're earning more interest if you are invested in those. But you have to be invested in them. And, uh, if you want to get invested in those, if you want to learn more about them, if you want a plan that is going to keep up with inflation, no matter what happens with inflation, uh, then go to Money Matters with mike.com. Just, uh, sign up there on the uh, contact us page or even fill out the risk profile questionnaire that's there on the home page as well. And, Michael, get started on, uh, getting a plan together for you. Or you can give them a call 704 5601573. That number again, (704) 560-1573. All right. Mike, so when when you were a kid, did you ever want to be an astronaut.
Speaker5:
Um, I guess.
Speaker3:
Yeah. I mean, for a minute, like, for for literal, I do remember dressing up and putting some tin foil on my head, you know, kind of thing, and dressing up in all white and looked like, uh, you know, looked like one of the guys that was walking on the moon. Um, that only lasted a minute. I think I wanted to be, uh, I wanted to be the Lone Ranger more than anything else. There you.
Speaker2:
Go. I that's I see, that's cool too, you know, tackling one wild frontier or the other. It's just all you, uh, you wanted to do. Well, I'm sure that, uh, Ed Dwight is now thankful that he has fulfilled a lifelong goal of his own. Ed Dwight is our retiree of the week, and he is the world's oldest astronaut at the age of 90. Um, tell our listeners just a little bit about the historic space flight that Mr. Dwight went on a little bit earlier this year. Mike.
Speaker3:
This year, at age 90 years old, he became the oldest person ever to go into space, uh, surpassing the previous record that was held by William Shatner. So, you know, I thought that was, uh, that was a pretty, you know, funny, uh, stat right there.
Speaker5:
Exactly.
Speaker2:
The final frontier there. Uh, he got to tackle it at the age of 90. And, you know, he was America's first black astronaut candidate, actually originally championed by President John F Kennedy back in the early 60s, but he was not selected for NASA's 1963 astronaut class. So he could have been one of those walking on the moon later on in that decade. Uh, but, you know, it didn't happen until earlier this year that he actually made it to space and talk about. So so that flight that happened earlier this year, um, it wasn't, you know, by NASA, it wasn't a NASA flight. Uh, who was it that that, uh, put that craft into space.
Speaker3:
As you guys may have, may have heard of a company, uh, you know, called Amazon, right? Um, Jeff Bezos actually has this Blue Origin company, and that space flight was conducted by the Blue Origin company. So Mr. Dwight, as well as five other passengers, experienced a few minutes of weightlessness during roughly a ten minute flight that was launched out of West Texas.
Speaker5:
That's so.
Speaker2:
Cool. And the flight really did mark a significant personal milestone for Dwight. He described the experience as life changing and expressed a lot of joy and fulfillment post flight, that his military service after that came to an end, Dwight became a successful sculptor, actually creating several notable public sculptures and memorials across the US. And, uh, I love it. We've got we've got, uh, just in our notes here. Great picture of him coming off of that space capsule after that Blue Origin flight. Uh, just, uh, holding his hand up high, big smile on his face. Boy, talk about a great accomplishment at the age of 90.
Speaker3:
At any age, especially at age 90.
Speaker5:
Yeah. It just goes.
Speaker2:
To show you. And that's why I loved, you know, featuring retirees of the week because Ed Dwight, he just shows you it does not come to an end. Life does not come to an end after you retire. For him, it was kind of really just the beginning there. So congratulations to Ed Dwight and all your accomplishments. Well all right so let's take a look now here, Mike, at a survey of people in their 40s and 50s. This is the generation X generation right there right behind the baby boomer generation. People born between the mid 60s and the early 80s. They are less financially confident than the boomers and less confident in their finances than the millennials. That's according to a new study by Allianz Insurance.
Speaker3:
Yeah. So barely six out of ten Gen Xers are confident that they will be able to financially support their lifestyle plans, comparatively speaking, to 82% of baby boomers who are older and 77% of millennials who came after the Gen Xers. I think those millennials may be in for a rude awakening. Um, among the Gen Xers surveyed, 58% also say, believe this or not, folks, they have no formal written financial plan. And if that is you, if you don't have a formal written financial plan, um, you're missing the boat. Because if you don't write stuff down, it's just a dream. And you know when you don't, when you have a dream, you don't have a plan of action, a plan of attack. You're not going to get there. In fact, the latest annual retirement study conducted by Allianz Life, which is an insurance giant, showed that generation X, which is mostly people again in their 40s and 50s, is more financially insecure than baby boomers or millennials. So if you are a Gen X pre-retiree looking to get started, you know, here's what you can do. Number one is set clear retirement goals. Actually define what it is that you want your retirement to look like. Consider factors like lifestyle at what age you wish to retire, and then any major expenses like travel, like health care, like maybe a second home that you need to factor into what those retirement goals are. Definitely make sure you consult with a financial professional, okay? Engaging with one who can provide personalized advice based on your individual financial situation as well as your goals, can help develop a comprehensive retirement plan that actually addresses all of those needs, as well as all of your desires.
Speaker3:
While you're in your 40s and 50s, take and maximize all of your retirement savings. Take full advantage of retirement accounts like those 401 K's, like those IRAs, like other pension type plans. If you're fortunate enough to have one, and consider increasing your contributions, especially if you're behind. All right, the year in which you turn 50, you get an extra, um, catch up contribution that is allowed by the Internal Revenue Service. So make sure you're if you're able to you're taking advantage of that. And then ultimately make sure you're diversified working with your financial pro to help diversify your investment portfolio so that you're able to reduce your risk and improve potential returns is just going to benefit you long term. And that might include a mix of stocks as well as other investment vehicles like annuities or real estate or any of the other things that we love to talk about on the show. So, um, bottom line is, is it up to you? You know, I always say, if it's to be, it's up to me, right? Well, if you subscribe to that philosophy, you have to first set a goal, write it down and then develop a plan of attack and attack. The plan.
Speaker2:
Yeah, that's absolutely right. I mean, you know, it all starts really with just making a decision to to get things in hand, to get things in control. And it really starts with getting in touch with Mike Zeno, getting in touch with a financial professional who can help you sift through it all. Because if you are overwhelmed by the idea of planning for the future, I think as so many people are, um, then I encourage you to get in touch with Mike, because there's a lot that you can do if the listeners will reach out and just start working with you today. Right.
Speaker5:
Mike?
Speaker3:
That's absolutely true. I mean, number one, we're going to discuss financial goals. We're going to talk about your vision for retirement. We're going to take a look at your current plan if you have one, as well as any assets that you might have in your portfolio, then we'll actually develop and walk you through what our recommended plan would be. And of course, we're here to help answer as many questions as you have about your retirement as far as how to get from point A to point B.
Speaker2:
Yeah. And we can help you, you know, along that path get you from point A to point B, uh, safely, effectively. Uh, and, and seeing a lot of, uh, you know, growth in those accounts as well because that is the goal, safety and growth as much as possible of both of those. And, you know, there are some signs here too, that you need to look for that you might be someone who needs to reach out, who needs to get a portfolio analysis, who needs that 400 and 1KX ray. Right. So talk about just a couple of different scenarios here, Mike, where somebody might uh, think, you know, oh should I, you know, reach out to Mike for, for some help if they are maybe falling under a couple of different categories here, then they they probably do, right?
Speaker3:
Yeah. I mean, if, if you're one that feels like you're in the rat race and on the hamster wheel, you know, you're constantly saving for retirement, but you're just not happy with the rate of return that you're receiving. Um, that's a sign that you may need a consultation if you feel like your money is not working for you as hard as you did for it, and you'd like to learn how to eliminate some of those fees, uh, and eliminate future taxes from your retirement. That may be a sign that you should probably have an analysis done. And if you're not receiving much, if any, help from your work based retirement plan servicer or your human resources department, well, then that's absolutely a sign that you should probably get with somebody who can help you navigate those often choppy waters so that in retirement, you land in calm seas. Yeah.
Speaker2:
And that's exactly what we want to see is, you know, planning, getting a plan in place that's going to account for the what ifs. So, you know, you don't have to if some of these uncontrollable, uh, things happen that are outside of our purview as human beings, the things that we can't control individually, if those happen, you're good. You know, you you can still take control of the things that you can control. And that is the goal for you in your retirement. Just go to Money Matters with Mike calm money matters with Mike comm. Or give Mike a call 704 5601573. Well, you know, Mike, I talked about one of those things that is, uh, at least it seems like it's out of our control. The national debt. We like to sort of follow that as it climbs each and every week. And I say that with a kind of a not not very genuine smile on my face. Just because you got to laugh to keep from crying sometimes. But give us the update here as far as this week goes.
Speaker3:
Yeah. We, uh, we just added another $10 billion to the national debt, which, you know, folks, a lot of people. I mean, again, you may not understand really what this means, but there is a debt per taxpayer right now that is approaching $267,000. That's for every United States American taxpayer in the country, 267 grand. Do you have that to give to Uncle Sam? Well, if they end up calling that debt due, that's going to be your portion of that debt. So, I mean, it has huge implications on Social Security, uh, Medicare, because it can impact the sustainability of those social net safety programs. Right. And those are crucial for our target audience, the pre-retirees and retirees. A high national debt just strains those programs, which could potentially lead to reduced benefits or increased eligibility retirement. And that is why we highlight the national debt.
Speaker2:
Well, Mike, some retirees are on the move these days. Uh, just speaking of the national debt there and the economy overall and kind of where people choose to move from and where they choose to move to, that can tell us a lot about the economy and about the trends that we're seeing. Uh, climate preferences, the search for better living conditions. So recent data shows that, uh, here are the places that, uh, retirees are flocking to and the places that they are leaving. Talk quickly about where retirees are going, first of all.
Speaker3:
Yeah. So, I mean, I don't think these are really surprising. Well, maybe one of them, uh, is. Right. So the leading the pack is Florida, right? Florida has seen an influx of over 77,000 retirees, which definitely makes it the most popular state for retirees. And you got the appeal. There is is no income tax. Okay, uh, a warm climate and a high percentage of the population being 60 and older, which is approaching 30% of all inhabitants of the state of Florida. And then following Florida, you have Arizona, which Arizona has welcomed a significant number of retirees with a net movement of almost, uh, 23 or a little over 23,500 over the past year. And that state is also known for its warmer weather as well as retiree friendly tax policies. So it's no surprise to me that, you know, retirees, people that have a little chunk of change are trying to move into a more tax advantaged situation. The one that surprised me is the state that I actually live in is South Carolina. It's become a favorite among retirees, with almost 21,000 folks coming over the past year simply because of its lower cost of living and pleasant climate. Uh, those are the two major draws there. And then Texas came in number four with almost 19,000 folks moving there last year because of the strong economy. Also no state income tax, which again, very attractive to retirees looking for a financially stable place to live.
Speaker2:
Yeah, absolutely. And no real huge surprise as far as where retirees are leaving. We've got California, New York and Illinois are the top three that people are leaving and going to those other states. And really with all of them, the primary costs are primary causes, rather, they say are high cost of living and the taxes in each of those places. So moving from a less tax advantaged place to a more tax advantaged place seems to make a lot of sense for a lot of retirees.
Speaker3:
It makes sense to me. I mean, I definitely am. I'm looking forward to, you know, where the next chapter leads. And then, you know, I think that I have a pretty good idea that I'm going to end up staying here in South Carolina.
Speaker5:
There you go.
Speaker2:
And you won't be alone.
Speaker5:
It's this week in history.
Speaker2:
We a couple of big events took place this week in our history. June 24th in in sports history here, Mike. On this date, 1922, the American Professional Football Association adopted the name that you might be more familiar with the National Football League. Uh, it would go on to become the US's most successful sport, with an average of 20 million TV, digital and streaming viewers each week. Uh, there was also, on June 25th, something that happened, Mike, a little bit, uh, more in our recent history.
Speaker3:
Yeah. June 25th, in 2009, legendary American singer songwriter, dancer and philanthropist Michael Jackson passed away at the age of only 50 years old. Obviously, MJ is one of the best selling artists of all time, having sold 400 million records worldwide. So the world misses Michael Jackson for sure.
Speaker5:
Yeah, that's one of those things.
Speaker2:
I remember exactly where I was when I heard that Michael Jackson had died only at the age of 50. Well, there you go, Mike. That is going to do it for this edition of the show. It has flown by here. But I appreciate you as always, sir, for bringing all that you do to the table each and every week. And we'll do it again next time.
Speaker3:
Thank you, Matt, for everything that you bring to the show. But most importantly, thank you to each one of our listeners. Whether you're listening to us on the radio or on podcast, wherever you may be on this earth, without you, we do not have a ghost. So thank you from the bottom of our hearts. Listen, folks, if you are in the retirement red zone, meaning you plan on retiring in the next five years, or have you have just retired in the past five years? Please give us a call so that we can help you strengthen your plan. You can't afford to lose too much during these years of retirement, which means protection and growth is the key. Whatever you're doing this weekend, we hope you enjoy it to its fullest extent and as always, make it a great day.
Speaker1:
Thanks for listening to Money Matters with Mike. You deserve to work with a licensed financial and insurance professional who can offer strategies for protecting and growing your hard earned money. To schedule your free, no obligation consultation, visit Money Matters with mike.com or pick up the phone and call 704 560 1573. That's 704 5601573 not affiliated with the United States government. Mike Zeno does not offer tax, legal or investment advice. Consult with your tax advisor or attorney regarding specific situations. Opinions expressed are subject to change without notice. These opinions are not intended as investment advice, nor do they predict future performance of any product. All information provided is believed to be from reliable sources. However, we make no representation or warranty as to the accuracy of any statement. This information is intended to be educational in nature and does not provide a guarantee or a specific result. All copyrights and trademarks are the property of their respective owners. Amara Life assumes no responsibility or liability for the content of this message. The information contained herein is provided on an as is basis with no guarantees of completeness, accuracy, usefulness, timeliness, or the results obtained from the use of this information.
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