Taxes, Turbulence & Retirement Truths: How to Protect Your Future

4.11.25: Audio automatically transcribed by Sonix

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

Speaker1:
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.

Speaker2:
Welcome to Money Matters with Mike, with your host, Mike Zeno. 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 people? Welcome to the show where we dive into the strategies, the insights, and the tools you need in order to secure a confident and stress free financial future. I'm Mike Zeno, and my mission is to help you protect your nest egg, outsmart retirement risks, and live the life you've worked so hard to achieve. Whether you're nearing retirement or already enjoying it. We're here to guide you every step along the way. And boy, do we have a ton of great information for you today. On today's show, we're going to discuss some challenges that you might face in retirement and how not to let them ruin or devastate your retirement plans as well as we're going to talk about some important information for seniors regarding Social Security, taxes, and a whole lot more. As always, I have the distinct honor and privilege of being joined by the one and only my co-host and producer extraordinaire, Mr. Matt McClure. Matthew, how are you today, sir?

Speaker1:
Well, Mike, I can't complain or I guess I should say I could complain, but it wouldn't do any good, so I'm not going to do it. So I'm doing I'm doing well.

Speaker3:
There are a lot of people complaining about the state of America right now, especially with the state of the markets.

Speaker1:
I hear you, it's that, you know, we often use the phrase Wall Street roller coaster. And that has definitely been the case, uh, here of late. But, yeah, we're, uh, here to help. Hopefully. You know, cause some blood pressure to return to more normal levels, I think is going to be the goal today.

Speaker3:
I think we've seen a lot more people vomiting, though, than going wee and enjoying it.

Speaker1:
Right. Yeah. No. Hands up going wee, hands up going help. You know. So yeah, I am right there with you on that one. But yeah. No, you're absolutely right Mike. We got a lot of great stuff to get to and hopefully things that will, you know, help educate and ease the minds of our listeners. And and speaking of our listeners, thank you for listening to the show. Really do appreciate it. Um, you know, we we say this every week, but we really do mean it. It bears repeating. Um, so thank you, thank you, thank you for listening to the show, wherever you're listening to it, on the radio or via the podcast. You know, if you you don't have to be in the Carolinas to enjoy us on the podcast there. You can be wherever across the globe. Just go to Money Matters with Mike comm, and you can find out where you can subscribe to the podcast. Basically, it's anywhere you get podcasts Podcast today. All right, so just subscribe.

Speaker3:
You're not looking.

Speaker1:
Exactly. I mean, if you've got a podcast platform, we're on it. So there you go. Um, just tap that app on your phone or wherever you download them, uh, on any of your devices and, uh, yeah, listen along with us each and every week we give you a new episode. Each week it's fresh and, uh, yeah, it's current as far as the the topics and the timing and everything go, we try to just weave in current events into what we talk about here, because it's really super important to make sure that it hits home for you so that you can navigate these kind of crazy times and get on a road to a more secure retirement for yourself. Um, we also do that via, uh, the YouTube channel. Just go to YouTube, search for Money Matters with Mike. You'll see highlights from the show, some special content there as well, and don't hesitate to reach out with any questions at Money Matters with Mike. Com or call Mike (700) 456-0157 three.

Speaker3:
Folks, I'm going to also encourage you that if you gain anything from our show, go ahead and like our pages, subscribe to our content and share them across your social media platforms. Because the more people that get exposed to good financial information, the better off we are all going to be. I am a firm believer that a rising tide lifts all boats, right? And above and beyond that, I absolutely love meeting with with listeners and discussing how we can help you reach your financial goals. And it doesn't matter what plan or aspect it is about retirement planning, whether it's risk management, estate planning, we do that in a whole lot more because building sound financial plans, folks, that's what we do best. So 704 5601573. That is my direct cell phone number. You can text me on that. You can call me on that. You can email me at Mike at Money Matters with Mike comm. Calm. Anything you have to do. Visit us on the web at Money Matters with Mike. Calm. Just get in contact with us. But don't forget to, like, subscribe and share our content.

Speaker1:
Carrier pigeon. Anything that you, uh, you know, pony Express, whatever you want to use to get in touch with Mike. Absolutely. Do it and get that free consultation. It is free of any cost or any obligation to continue on. Um, and of course, yes, Mike, we're going to talk about a lot of different things today, hopefully to give some peace of mind to folks or at least give them, you know, some, uh, information as far as how they can navigate things in this crazy, crazy world that we live in. Uh, but we've got some talk about taxes, retirement, tax strategies. We're going to talk about Social Security and the cost of living adjustment. We've got those four challenges that could ruin your retirement as well. So we'll get to all that momentarily here. But first let's get a little inspiration for our conversation shall we. We do that each and every time around with our quote of the week.

Speaker4:
And now for some financial wisdom. It's time for the quote of the week.

Speaker1:
And this week's quote comes from the one and only Will Rogers, who said this. The only difference between death and taxes is that death doesn't get worse every time Congress meets. I love that Will Rogers. He had a lot of those good, you know, funny lines like that. That's got to be one of the best, though I love it.

Speaker3:
It is. And while we may laugh at that, those of us planning for retirement, well, that's a stark reality. Taxes have a way of creeping up on us, whether they come via new laws or new regulations or changing tax brackets. All of that can eat away at our hard earned savings if we are not prepared. And unlike death, which only happens once. Taxes, unfortunately, are a lifelong expense that can and often do keep increasing. Right. So what's the solution?

Speaker2:
Hungry for something to chew on? Here's some meat on the bone.

Speaker3:
The key to actually enjoying retirement and not just surviving it is proactive planning. We need to structure our income in order that we minimize taxes, leverage tax advantage accounts, and then stay ahead of any legislative changes that could impact our nest egg. Because the last thing that we want to do is spend our golden years worrying about what Congress will do, instead of enjoying the financial freedom that we have worked so hard for. Think about it this way taxes do not stay the same, right? Laws change, brackets shift, and new policies can take a much bigger bite out of your retirement income each and every single time Congress meets. So if you do not have a plan, you can end up paying far more taxes than are necessary money that should be funding your lifestyle, your travels, your time with your family. And that's why smart investing and smart retirement planning is not just about saving, it's about protecting what you have saved. Strategies like I mentioned, tax efficient withdrawals, Roth conversions, and using tax advantaged accounts can make a huge difference in how much of that hard earned money you actually get to keep the goal. Well, that's simple control your tax burden so that you can enjoy your retirement and not stress about how much of it is going to Uncle Sam. But let's be honest, death may be inevitable, but high taxes in retirement. Well, with the right planning, that doesn't have to be the case, Matt.

Speaker1:
Yeah, that's totally preventable there. You know, I mean, you can actually plan in a way that will reduce your tax burden because, you know, Uncle Sam, uh, you know, I love Uncle Sam. I love my country. But Uncle Sam's not the best retirement partner, um, in the world. So you want you want to minimize his impact on your retirement as far as your taxes go, uh, as much as humanly possible. And, um, you know, speaking of that, Mike, it's just about tax time here. It's getting down to the wire. If you haven't filed your taxes, it's coming up on April 15th, that deadline. It's really just around the corner now. And um, you know Mike, we've got some it's of course everyone's favorite time of the year. Uh, but we've got some topics here to talk about as far as what people can do while taxes are on their mind, as far as some retirement tax strategies for tax season. And one of the very first here is really important when you're talking about year to year taxes and, you know, filing your taxes each and every year with the IRS, and that is to consult with a tax professional because they'll be the ones to help you navigate kind of the here and now and making sure you get all the right deductions and that sort of thing. As far as you know, this year's taxes go right?

Speaker3:
Yeah. No doubt if especially if you have a complex financial situation or you're unsure maybe about certain tax matters, you should consider seeking advice from a licensed tax professional, because they can make sure that you are taking advantage of all of the deductions and credits while you're still staying compliant with tax laws. And I know a lot of people try TurboTax. Heck, I tried TurboTax and did it for several years until it just got a little bit too complex for me to handle, and now I am so grateful that I pay a person every month to take care of my taxes so that I don't have to meet up with the IRS because of of an audit, right. These things are protected. And then you want to make sure that you file your taxes on time. Filing by the deadline is is is prudent. That's April 15th this year. And if you do happen to be somebody who needs more time, you can file for an extension. But that extension only extends the time to file. So if you owe taxes, you still have to have that tax paid by, uh, April 15th.

Speaker1:
Yeah. And that which is always kind of a wake up call to people like, oh, wait a minute, I still have to pay even though I don't file. Yeah you do. That's the deadline to pay is April 15th, regardless of whether or not you file or you file for that extension. And you know, Mike, when we're talking about future taxes now, uh, you know, you mentioned planning for, uh, different types of, of, uh, accounts or planning using different types of accounts because they're taxed in different ways. There are actually two completely tax free investments that are available as well. And I know that you love help folks kind of navigate those and see how they could possibly work into their own retirement plan.

Speaker3:
Yeah. So the first one is going to shock a lot of people. And it's actually life insurance, right? You can do some pretty advanced life insurance planning to be able to set up tax free loans against the death benefit that you never have to repay. It's just offset when you pass away by the money that you leave behind. So there again are some really advanced strategies with life insurance that might be the right move for you. It's not right for everybody, but it is right for a lot, right? The other one is the Roth IRA. Well, why are Roths important? Well, because you're paying tax on the seed and not on the harvest, right? You pay tax one time at a known rate so that in the future that money grows tax free forever. Okay. And then whenever you pull it back out that tax has already been paid, so you don't have to worry about that. And if you pass away, then that money also passes tax free to your heirs. So a lot of people think that municipal bonds, um, are a good way to go, but they're not necessarily tax free and are sometimes subject to both federal, state and local taxes. And believe it or not, folks, those can also impact Medicare costs if you're a high income earner. So, you know, when we talk about tax efficient planning, you want to make sure that you have the right tools in your toolbox.

Speaker1:
Absolutely. And if you, you know, have, uh, the wrong tools in your toolbox, if you're not sure what tools you need, uh, you know, don't don't use a hammer to try to do a job that you need a wrench for, kind of a thing. Uh, go to Money Matters with Mike. Uh, he's, uh, he's the tool man. It's almost like Tim the Tool man. Taylor here or something. But Mike Zeno is the Tool man. He can make sure you got the right tools to go inside that toolbox. Money matters with Mike comm. He can help you out with all of that. The consultation, by the way, is free of any cost and any obligation. You can also give them a call (704) 560-1573. That's 704560 1573. Of course, Mike, we all pay taxes on, you know, via payroll taxes to Social Security. Um, and that is always a big topic. Of course, these days when we're looking at, um, of course, a lot of changes in the federal government, a lot of kind of slashing and burning going on as far as government agencies and things like that. And people are like, okay, what is the impact going to be on Social Security? It's a big topic. Um, but also a big topic. Um, every single year when the calendar turns is a cost of living adjustment. And there is that cost of living adjustment coming up. Of course, for 2026, they say it could be a historic one, but not necessarily in the best way for retirees.

Speaker3:
Yeah, for most retirees, Social Security income isn't something they can make do without. And based on 23 years of annual service surveys from the Gallup poll, between 80 and 90% of retirees rely on Social Security, uh, to cover at least some portion of their expenses. And so that just underscores why the annual cost of living adjustment is so important. All right. That fabled cola that you're always hearing about is the tool that Social Security used to help account for the effects of inflation, which basically means the rising cost of living over time. And because that income is so vital to the financial well-being of our nation's retired workforce, perhaps it's no surprise that many pay attention to the annual cost of living adjustment reveal from the SSA during that second week of each October.

Speaker1:
Yeah. Absolutely. Right. And, you know, this kind of shocked me too. Just the the numbers here that we're going to talk about. In February of this year, more than 52 million retired worker beneficiaries took home a social security check. That average check was just over $1,980. So 1980, in some sense. And that means that, you know, any cost of living adjustment of 1% or greater next year would make history by lifting the average monthly benefit above $2,000 a month. There. Mike.

Speaker3:
Following the release of that February inflation report from the US Bureau of Labor Statistics, nonpartisan senior advocacy group, the Senior Citizens League adjusted its 2026 Cola forecast to 2.2%. So, based on the analysis released, um, the buying power of a Social Security dollar has decreased by 20% for retirees. And that's just since 2010. So that erosion in buying power. Guess what, folks? Unfortunately, it is likely to continue in 2026, both with, you know, Medicare. Uh, excuse me, medical costs, uh, as well as housing costs. The inflation that those two particular areas have have experienced is way higher than the projected cost of living adjustment.

Speaker1:
Yeah. That's right. I mean, it does. We often ask the question, does the cost of living adjustment actually keep up with the cost of living? Uh, and the increase in that? And uh, a lot of times the answer to that question is unfortunately not. And, you know, the other reason, just a little bit higher Social Security check isn't necessarily good news for retirees is the Old Age and Survivors Insurance Trust Fund is forecast to just kind of go broke. Um, it will exhaust its asset reserves, in other words, by 2033, they say that's according to Social Security Administration itself and the OAC, that's the Old Age Survivors Insurance Trust Fund. Oac is responsible for dishing out those payments to retired workers and survivor beneficiaries each and every month. So there's more cause for concern there.

Speaker3:
Yeah. No. And then if if ongoing demographic shifts, coupled with inaction from the lawmakers on Capitol Hill, eventually deplete those asset reserves in just eight years from now. Well, the Social Security Board of Trustees estimates that sweeping benefit cuts of up to 21% may be needed just to sustain payouts. So the long story short, the higher the cost of living adjustment, um, potentially the greater likelihood of expediting the timeline to possibly sweeping benefit cuts. So that's not great news for retirees and beneficiaries of recipients, rather of those Social Security benefits.

Speaker1:
Yeah. And, you know, I mean, this would be a good time also to mention here, Mike, go go back and listen to last week's show if you can, because we talked about there why it's so important to have a backup plan for Social Security and what you can can do. Right. You know, the things that, um, are possible for you to do to have a backup plan for Social Security. It's really super important to make sure that, as Mike often says, you want Social Security to be the cherry on top of your retirement plan, not the entire ice cream sundae. Right. So go go to Money Matters with Mike. Com, if you will, and reach out because Mike's standing by wanting to help you out. Just go to Money Matters with Mike. Com and reach out via the contact page and set up that initial consultation.

Speaker3:
Yeah. And while ice cream sundaes are good, but I can tell you creating a personal pension that you can never outlive. That's a whole lot more tasty.

Speaker1:
There you go. It's a whole and a whole lot less. Uh, you know, fattening to the to the old waistline there, too. Uh, I'm sure I'm sure about that. I can attest to that myself. Um, but, you know, I mean, and and there's the thing is, what you love to do each and every day, Mike, is just that help people sort of navigate challenges that can really kind of wreck their retirement if they're not addressed in the proper way. Right. So, you know, getting to retirement by just, you know, relying solely on Social Security, that's something that can really be detrimental to you in your later years in life. You know, you don't want to have worked so hard for so long and then only have Social Security to rely on, because then you could end up in the poorhouse. You know, so, um, there is a this Kiplinger article that we found that I actually wanted to to highlight here that talks about four specific challenges that can ruin retirement for seniors. And number one we're familiar with this one lately is stock market volatility.

Speaker3:
Yeah, folks were kind of lulled to sleep from 2010 to 2020. You know, everything was great. People became very, very wealthy in the market. But we have had market volatility return with a vengeance. And during your accumulation phase, when you're building and you're building and you're building, the stock market can absolutely help create wealth for retirement. But as retirement approaches, folks, protecting your savings should become a priority. And while diversification can help mitigate the impact of market downturns, you want to make sure that you have things in place that are 100% protected from any market downturns. And so I'm going to give you a little bit of a retirement income tip right here, in that you can reduce the risk in your portfolio and establish a personal pension that creates a lifetime income stream with one simple strategy. So if you'd like to explore personal pension options for your retirement and be able to maximize your retirement income potential, pick up a phone call (700) 456-0157 three or visit Money Matters with Mike comm and get in contact with us so that we can help you reach your retirement goals.

Speaker1:
Yeah, and another one of those challenges that you might need help navigating. It's one that we've talked about here on the show already today. And it's on everybody's mind because of tax time here. And that is taxes. Uh, you know, the IRS is uh, the IRS is standing by waiting for your call.

Speaker3:
Every year around this time in my Facebook memories, a pop up of this young kid playing the game of monopoly who goes into an absolute meltdown crying because he's just been assessed a bunch of taxes on the monopoly board. And he's like, you know, he's just absolutely crying. He's like, what's wrong with you? And she's like, I hate this game. And he goes, and mom goes, why? And he goes, taxes. It's the worst part. And so we find that most people believe taxes are going to increase in the future. But at the same time, those same people have very little to no money in their tax free bucket to pull from in retirement. So, you know, that doesn't align with what they believe. And so there's an adjustment in a very simple one that we can make. Right. Here's something else. Medicare beneficiaries who have high income may face additional monthly surcharges. Those are called Irma's income related adjustment amounts, and strategies like converting some of your savings that are taxable over to a Roth you know, account. Whether that's a Roth IRA, for example, can help lower your future tax burden. And you just want to make sure that those are done at least two years before you start Medicare, because Medicare will go back, uh, two years on their lookback period. So there are strategies that you can help mitigate and eliminate some of those taxes in retirement. You just got to take action, folks.

Speaker1:
Yeah. That's right. And the easiest way to do that is by calling 704 5601573 or going to money matters with Mic.com reaching out there and scheduling that initial consultation. Um, another big challenge, Mike. And this one is one that it's another one that keeps just going up and up and up. And that's long term care costs.

Speaker3:
Yeah, those can Significantly impact retirement savings, especially when you talk about the average annual costs for home health care, for assisted living, and for nursing home 24 hour round the clock care is absolutely an astronomically increasing. And inflation is having a greater impact in those areas of medicine and health care. And so the right long term care insurance policy, or at least something that addresses some long term care needs, is just prudent and can save you a significant amount of money in retirement.

Speaker1:
Yeah, there are certain things out there that, uh, you know, could increase your income if you have, you know, one of those personal pensions that we often talk about could even double your income if you are, uh, you know, in a nursing facility or a long term care facility, something like that. Like, that's another option, potentially, for folks. You just got to make sure that it's right for you. But there are options out there, right?

Speaker3:
There are. In fact, I just helped a client whose husband, um, was a little bit older, but because she had set up a personal pension and was already drawing income once she was no longer able to care around the clock for her husband. Um, they had some. We were able to have some in-home health care provided because her income, because of the personal pension that we set up, doubled because of his inability, uh, to to do a couple of the what are known as activities of daily living. So just having that extra income to help offset that cost was an absolute lifesaver for this particular couple.

Speaker1:
Yeah. And so just so you know, folks, those are some of the options. There are more out there as well. And Mike can help you navigate them all. Again money matters with Mike. Com is the website. And um, another thing, you know, it kind of goes hand in hand with number three. Mike is number four. And that is longevity because the longer we are living now, of course, the the more likely we are to need long term care as we get older, right? But you know, our our retirements just in general are lasting longer now. I mean, 2 or 3 decades perhaps. And so. Yeah, exactly. So we got to plan for that.

Speaker3:
Yeah. I mean, back in the day, you know, you retired at 55 years of age, and if you lived 20 years in retirement to 75, that was an amazing lifespan. Well, now people are, you know, retiring in their 50s to 60s or even 70s and then living 20 to 30 plus years in retirement. So that absolutely requires exquisite careful management of your retirement income assets and maximizing those guaranteed income sources like Social Security, regular pensions if you're fortunate enough to have them, or personal pensions if you were smart enough to create one. Those top concerns of retiree. Um, are. You know, making sure that we address not outliving their savings.

Speaker1:
Yeah. Yeah. Again we talk about having more money than month, not more month than money when it comes to, you know, like your your budget, your spending plan for every day. Well, for that long term plan, you want to make sure that you have that income that you are not going to outlive. You want more money than life, in other words. And so if that is something that you want to look into and explore and give you just the peace of mind that comes along with it, folks go to Money Matters with Mike. Com that's Money Matters with Mike. Com click on the contact page and reach out to Mike Zaino there. Or give them a call at (704) 560-1573. That's 704 560 1573. And that is a direct call to one Mr.. Mike Zaino.

Speaker3:
Folks, it is time to get your money working for you as hard as you work for it.

Speaker1:
Absolutely right. And speaking of time, it's time for us to run. So that's going to do it for this week's show here. Mike, I caught you off guard with that one. It's it's by the old clock on the wall. I can see it's time for us to go. But thank you as always, sir, for everything that you bring to the table. And we'll do it again next time.

Speaker3:
Absolutely. Thank you for everything you bring to the table. But most importantly, thank you to all of our listeners. Again, I'll reiterate if anything on this show resonated with you. Please like our pages, share our content across your social media. Because the more people we help, the more people we help, right? So whatever you're doing this weekend, I hope you enjoy it to its fullest extent. And as always, make it a great day.

Speaker2:
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 704560 1573. That's (704) 560-1573 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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