TPWM 8-28-21 FINAL.mp3: Audio automatically transcribed by Sonix

TPWM 8-28-21 FINAL.mp3: this mp3 audio file was automatically transcribed by Sonix with the best speech-to-text algorithms. This transcript may contain errors.

Speaker1:
The following paid program is prerecorded and sponsored by Take Point Wealth Management on the nature coast of Florida. Take point on retirement, a well rounded show from a well rounded team leading you into retirement. Listen for an hour of simple retirement advice from your friends at take point to wealth management. Well, there you go, folks. Yeah, take point on retirement brought to you by take point wealth management. Eric Arnold, lead advisor, retirement planner with takk point wealth management here in our studios. It is a prerecorded show, by the way. Friends in the studio include Eric Arnett and Randy Woodruff, of course. This week, we're going to talk about how the markets are responding. We're going to talk about some tax free investments in Roth IRAs. It's all coming up on this is the action of take point on retirement brought to you by take point wealth management. By the way, the number real quick, because you're seeing how the markets are reacting. You're seeing how your friends are investing. You see where your family is retiring and you want to jump on board, give take point wealth management and call today and make your plans. Get that financial analysis, that consultation evaluation and have them draw up that take point blueprint on retirement just for you. Check them out online. Take point wealth management and you'll see Eric Arnet once again. And welcome, gentlemen.

Speaker2:
Crazy times, right? Lots of changes. Lots of interesting things going on out there and uncertainty, a lot of uncertainty. And I think we probably anticipated some of this. Speaking specifically about political climate here in the United States. But more importantly, what does that mean for our retirees? What does that mean for folks that are planning on retiring soon? There's a lot of information that we need to run through here and get people prepared and aware of as to what's going on. So the markets have been pretty volatile. Really, the markets have been mostly focused on COVID 19. Are we going to have lockdowns or are we going to keep the economy open? So many unanswered questions and confusion. And unfortunately, a lot of it's all been, I think, politicized not to get into politics too much here today if we don't have to. But we saw the market kind of building up. What was interesting is because of COVID 19, really, it was one sector or one segment of the economy in the market, which is the technology sector. You had four or five blue chip large tech tech companies and really drive an entire market. The rest of the market, the broad market, all the other companies out there and all the other sectors of the economy are still a little bit beaten up and still poised for recovery, hopefully, if the economy continues to get better. Now, we had some really good key economic data coming in and jobless claims are getting better. Unemployment rates getting better. Manufacturing was getting better. We were seeing things start to improve. So I hope we continue on that path. One thing's for sure, I guess now this week we're getting more reports of Covid increases and things like that. So I know there's a lot of rhetoric out there between, you know, the parties and different folks. Shall we shut down again? Shall we not shut down again? I think it would be devastating for us to shut down again. I just don't think that's an option. If we do shut down again, then I think it'll be real tough on the economy in general.

Speaker3:
If you have a business in which I have a lot of business clients and some of them have been significantly impacted, some of them are out of business. That's not fair to them. So there's always going to be some winners and losers in that decision, because it is is a very tough decision. It's going to it's a very consequential decision. Go through another shutdown is going to be interesting to see everybody's reactions to it.

Speaker2:
One of the things that always talked about, even prior to Covid, even prior to the Democrats, I guess, gaining steam and Mr. Biden being the president elect with a twenty eight trillion dollar deficit, regardless of who's in office, the tax reform act that Trump passed to reduce taxes across the board in several areas is in jeopardy if we don't know a whole lot. But what we do know is, regardless of what happens, taxes for retirees are going to be one of the main, I guess, silent killers. Joe has already said he's going to pull back all the tax cuts that Trump put in place. So there'll be much higher taxes, I believe, in the future for our retirees and folks that are planning to retire. So what do we do here at take point wealth management? And one of the things that I'm always concerned about and always hearing my clients being concerned about is, you know, what do we do to combat this? So, you know, what type of tax free investments are strategies can we put together to try to potentially combat, you know, what's going to happen? I mean, there's there's about 60 trillion dollars, I believe, in retirement accounts. Hmm. And so I'm sure the government officials say parties I guess I don't want to create any partisanship here, but they're probably licking their chops, seeing that as a nice bucket of money to be able to tax. So we all know that retirees at some point will at age 72 now will have to start taking money, required minimum distributions from their own Kazan's. Iras, and those will be taxed and they could be taxed very heavily, so today I think we want to talk about some strategies that we can put in place to kind of alleviate that for our retirees long term.

Speaker3:
I think it's important for our clients, our listeners, to be thinking about taxes, not so much in terms of who's in office, which parties in office, which party has control of Congress and the White House. But just take a look at where we're at in our country from a debt standpoint. You know, back in 1980, when Reagan took office, we had one trillion dollars of national debt. Right. So we had was one trillion dollars. Now, fast forward 40, 41 years later, we're at twenty eight trillion right now. So we're definitely spending money quicker than we're breaking it. And we all know in our personal finances, if you can honestly spend more money than you're making, eventually you're going to go broke or you need to make more income or you need to cut your expenses. So we all know that is based on what we've seen over our lifetimes. Most of the time, government does not do really well in cutting expenses. That's really good at raising taxes or raising revenue. And so I think we have we need to, as I'm talking to my clients, just keep that in perspective. Don't worry about who's in office. Just look at taxes. You're going to have to go up. So what's going to happen? They're going to increase it in the folks that have money. So I'm telling my clients, forget who's in office. Forget politics. Just look at the numbers. Taxes are going to they're going to have

Speaker2:
To go up. Yeah, we've seen in the analysis that we've done for our clients is if we can put together our tax free strategies for our for our clients going forward, we show them based on, you know, a 30 year retirement plan, 20 year retirement plan, the massive amount of money we can save them, hundreds of thousands of dollars in taxes and fees.

Speaker3:
If you're looking to enact a strategy to reduce your taxes in the future here, now is the time to begin looking at those strategies, because tax rates, especially on capital gains, ordinary income as well. It doesn't matter what level of income you're making. Everyone benefited in a positive manner from the Trump tax cuts. Absolutely called the Trump tax cuts because he was the president when they got enacted. Everybody saw a reduction in their tax rate. So it doesn't matter what income level you were, you bet you benefited from it. So going forward, that's going to

Speaker2:
Have to go up prior to even a couple of years ago, not knowing who the heck was going to be running for office and what type of political climate we're going to be looking at here in the future in twenty twenty one. It's always been a concern for us because we knew that this tax reform act could sunset in 20, 25 anyways. So even if Trump got back into office, there's another election. Twenty, twenty four, you know, twenty, twenty five, where you just can't predict what's going to happen. But you know that these tax cuts have to get rolled back and taxes are increase on the rich, on retirees, 100 percent in your taxes are going to probably increase in the future. There's just no doubt about it. I don't care about what you hear the rhetoric. Oh, we're just going to only tax the rich now. There's no way it doesn't happen. It's rhetoric and it's bull. Everybody is going to get tax. And let's put it plain and simple. If if you tax the wealthy, the ones that own the businesses and the companies, and guess what, folks are just going to increase. They're going to keep their margins the same. They're just going to increase prices and increase what they pass on to you. So guess who does end up paying the higher taxes? It's the middle class, the middle class, no doubt about it. So it's all it's all Boltz, all malarkey. That's my my true feeling on it. But one thing that we definitely 100 percent focus on, regardless of the political climate going forward with our retirees, has been our plan.

Speaker2:
We are reducing taxes. We are reducing fees dramatically. We can show you how we can reduce fees dramatically, which also adds hundreds of thousands of dollars to your retirement portfolio over the long term. And we're going to also reduce risk. Okay, everybody that comes in, they have way more risks than they they know that they have. I mean, you know, we have clients come in close to their eighties that have substantial risk and don't even don't even know it. Yeah, we have to reduce risk. We have to achieve strong returns at the same time. But we have to reduce those fees and we have to reduce those taxes, because that's truly what just eats away at retirement. Getting into specific types of investments, some specific types of strategies that we want to share with our listeners. More importantly, get on the phone, give us a call. Jdub is going to throw that information out. You go to our Web site. Our radio website is take point on retirement dot com. Fill out a form, get in touch with us. We'll set up an appointment with you, get on our regular website, take point wealth management dot com and just get a hold of us. Let's get you in and let's start talking about these things. Cpa, 25 years experience investment advisor. Twenty two years of experience right here in Hernando County. We look to really help folks out. We're truly passionate about it. Yeah, that sounds

Speaker1:
Good to me. Tax free is the key word. We're going to talk about two types of truly tax free investments when we return. Grab a pencil, a piece of paper, write this down at three five to six one six zero five one one. That's the number you want to call to get in touch with Take Point Wealth Management, the name of this show, Take Point on retirement. It's all about a stress free retirement brought to you by take point wealth management. An online check it out for yourself take point welles' dot com. And if you have a question, we'll use that question on our future episodes and give you the answer on the air as part of the program. E-mail your questions to info info at take point on retirement dot com. That's info take point on retirement dot com. And while you're there, ask for that free. That's right. That free financial analysis. So we're going to talk about tax free investments when we return. So stay with us. Eric Barnett as a member of the service for your service.

Speaker2:
Thank you. Thank you so much, guys.

Speaker1:
And he'll tell you where he gets that take point name from when we return. So folks will be back right after this with your friends, Eric Arnette, Randy Widra. There's truly J-W in 1999. Be it is take point on retirement. Any comments regarding safe and secure investments and guaranteed income streams or refer only to fixed insurance products do not refer in any way the securities or investment advisory products. Fixed insurance and annuity product guarantees are subject to the claims paying ability of the issuing company and are not offered by retirement wealth advisors. Just a little compliance disclosure there for you from your friends. Take point a wealth management. It is take point on retirement. Eric Arnet, lead advisor, retirement planner in our studio, CPA, a tax guru, Randy Woodroffe here as well. And we've got a lot more to cover this morning, folks. It is an hour long program, so stick around. A lot of important information, like free consultations or financial analysis evaluations and even a free literature that they want to put in your hands. That's right. Stress free retirement. It's all available through check point. Wealth management and their Web site take point on retirement. That's take point wealth dot com. Big point on retirement. The name of the show. Take point blueprint on retirement is ready for you. If you just call them three five to six one six zero five one one. So we're going to get into some tax free investments in the meantime. Eric Arnet, who picked out the name along with Randy Woodroffe Take Point, has served in the military. And real quickly, for those that are just tuning in, never heard this before. Where did you get that name tag point from?

Speaker2:
First of all, it was truly an honor to serve my country that it proudly for six years, active duty in the U.S. Army to close to three combat tours. When I was thinking about a name and how to brand ourselves, I wanted to give tribute to that military experience of some of my fallen brothers and heroes and kind of bring light to that take point simply means, you know, most all first responders are the type of people that are just going to jump up and take point, take the lead and get us to and through crisis, lead us through the mission. And I was sitting there thinking, you know, there's so many retirees out there and people getting ready to retire that are poised to make a lot of mistakes. They just don't know what they don't know. And I thought, you know what? This kind of makes sense. We as leaders, Randi, and I need to take the point, take the lead and help them to create a better retirement for themselves. But at the same time, we want to educate these folks and give them the sense of leadership and so they can lead their families, all first responders. We love them. And a love for those guys to give us a call. We work with them and we give, you know, big discounts there, too.

Speaker2:
But that's kind of the history behind it. When you're on a mission in the military, there's always somebody that has to step up and take the point, take the lead, lead the mission, be out front, be the eyes and ears of your squad or your platoon. That's usually a pretty brave individual who's ready to go. So I thought it kind of made sense. We we talked about a lot of different names, like long time. And I was laying in bed just that came and I looked it up. And, of course, you know, when you're choosing a name for your firm, even though we've been in this business a long time, we've kind of wanted to rebrand and head in a different direction. You know, you lay in bed thinking about these names, and this one came to mind. And I actually I shot Randi a text at like 10 o'clock at night. And I said, what do you think about this? And he goes, that's it. That's it. So after throwing around hundreds of names, you know, so that one just clicked. And we actually did a survey with our clients, too. Most of them thought it was pretty cool. Some of them didn't get it. And, you know, you're not going to impress everybody. That's great.

Speaker1:
So that's the type of people you're dealing with. That take point to management taking point for you. A lot of us have grown up without that leadership. We had no idea what a budget was or what savings is. And so somebody needs to lead you into that and of course, into a safe and stress free retirement. And that's what they do at take point wealth management. Well, thank you so much. I love that. And honor your service. And thank you, sir.

Speaker2:
So let's get into some some strategies where you say or any great idea. You know, one of I want to talk about two things here. You know, they're pretty in-depth topics and strategies, but we're just going to kind of brush over them. That's why you come to us to really dive into the details so we can help you out. But one great strategy is just a Roth IRA underutilize and Uncle Sam's not out there educating you to how you can save taxes in the future. So most people. Just don't know a whole lot about it, and there's not a lot of information out there as more and more on the Internet as we go these days, but you know, Uncle Sam is not going to come out and say, hey, you know, might be a good idea for you to do a Roth IRA or a Roth conversion. So quite simply, a Roth IRA is a retirement account that you can contribute to. And there's different limits and and whatnot based on income levels and all that. But if simply put, money in after tax dollars, you don't get a tax deduction for that contribution, but that money will grow tax free while it's in your account. And when you need to go ahead and start taking it out for retirement, it's going to be tax free. So typically, I believe the rule is you have to leave it in there for five years before you can start withdrawing. You got to be 59 and a half. There are some rules which will go over with you guys, but you just need to know the basic concepts of it, tax free growth. And then later on in retirement, five years from now, 10 years from now, 15 years from now, 20 years from now, when tax rates could be extremely high. By the way, I think back in like the 40s and 50s, during the FDR days, it was like 80 percent tax rates back in the old days.

Speaker3:
So we could end on some high income earners directly on capital gains. Yes, it was, you know, the height when you got high dollar capital gains rates just shot way up. And it was obvious we were very fortunate. Right. Right now. And tax rates were very bad, both for capital gains and, oh, the

Speaker2:
Capital gains are extremely low.

Speaker3:
They've only been this low when it works with other times in history. They came around capital gains of, say, in 1940. Right. And probably since then, this is the second time they've been this low.

Speaker2:
We've had a great deal of success in our channels of education through our seminars, webinars and even individual client meetings where people are getting it. They understand it once we educate them and walk them through it, and they are making some bold moves and moving that money to tax free strategies. I can think of some clients that were recently working with now they are transitioning their current IRAs and 401. Ks into Roths because they're smart. I really think that's they're like, hey, we're going to take advantage of these tax rates now, because Democrats are going to certainly raise taxes and they're going to do it quickly. So Roth, IRA, great strategy. A lot of details there. Roth conversions, you can simply roll your money from your current for one career, IRA into a Roth. You are going to pay tax on that portion. But once it's in there, think about the growth that you're going to get long term. And then later on when you have to start taking money out, it's going to be tax free.

Speaker3:
And there's no requirement to take money out of the Roth either.

Speaker2:
That's right. Which is great. That's huge.

Speaker3:
Yeah. So if you get enough income to live on and you don't need the money in your Roth IRA, you can pass that income down to your children. I can look at the rules. I haven't done this in two or three years, but I think that they can leave the money in there until they get to retirement age. So I just think if you if you did a Roth conversion and you're 60 years old and you wrote a couple hundred thousand dollars from a traditional Roth to a to a Roth IRA, and then didn't pull from it your entire retirement because you had plenty of other income kids inherited your Roth IRA, they'd have to pull it until and they start pulling on terror 59 and a half or 60. Think of how much money they would have that accumulated all those years, all that compounded growth tax free. They get it when they retire. So huge opportunities. It's actually a great estate planning tool as well. You can convert the Roth IRA today, pay the taxes out of your estate, and then you still do. It becomes part of your estate. But children get to put that money out of tax free when they pull it out. So it's an estate planning tool as well.

Speaker2:
Well, you bring up a great point. Number one thing about this, if you don't have to take out distributions or if even if you do take them out in their tax free, it doesn't go to your bottom line. And so therefore, it saves your Social Security from being taxed. Could very you could also your Medicare, you could could go up because of your income level so you could save on your Medicare costs. I mean, it's huge across the board. I mean, it's massive savings.

Speaker3:
Eric and I as planners, we're talking with a client. And if they get several different income streams and let's say one income stream jumped up significantly during the year that was taxable or they wanted to lower their taxable income for a particular reason. We just pull from the Roth or not pull from the Roth. And he gives us as players more options to be able to use to manage your income in return, but also more broadly, manage your tax liability. So not just the the tax savings, but also the tax savings long term, because tax rates are going to go up, but allows us to manage those taxes going forward as well, and your cash flow in a very tax efficient manner.

Speaker2:
Well, it's also huge is if you're if you're contributing to a traditional, you cannot make any more contributions after you turn 70 and a half. However, what the Roth guess what? You can continue making contributions forever. Typically, I mean, our listeners that are in that 55 to 65 kind of age bracket, they're going to be 66 and some months or 67 is going to be their full retirement age. Ok, so full retirement age means if you guys go on to Social Security, dot gov, ssa dot gov, you can look up your own Social Security part and I'll give you estimates of this. It's based on your work history and your highest earning years so you can actually see the prediction of. What your benefit will be at full retirement age now. You can defer that all the way up to age 70 every year that you defer your Social Security payments are going to increase by eight percent if you take it earlier than for retirement age at age 62 is when you're actually eligible. It's going to be a reduced benefit for those

Speaker1:
That are south of 60. We've heard talk over the years about Social Security not being there when we reach that age.

Speaker2:
We just don't know. Right. Right. There's a lot of different talk and rhetoric out there. It could be reduced or what's going to happen is they'll make that full retirement age later. So maybe for guys like in our age bracket 50. So we got another 25 years to go 26. They may change it where our full retirement age is age 70. I don't know. They're going to have to do something because, you know, I do think the system is getting pretty stressed. So there'll probably be some changes down the road. But for the most part, think about this. You paid in to this system your whole life. You need to maximize those Social Security benefits for you, yourself and your spouse. And we can show you how to do that and minimize taxes on that benefit as well. We also want to talk a little bit about what the wealthy do with their money to avoid taxes in retirement. We've also heard a lot of

Speaker1:
Talk about our 401. Ks maybe getting hit. And that's why Roth IRAs makes so much sense right now. Let's get into it. Yeah, that in life insurance has specifically indexed universal life policies. That's why we have the professionals in our studio. Eric Arnette, lead advisor, retirement planner, CPA, Randy Woodruff. Next slide them. We're all in the studio here as a prerecorded show. This episode of Take Point on Retirement brought to you by take point wealth management, three five to six one six zero five one one.

Speaker2:
I hope folks give us a call and get going on this stuff. Yes, I really do. We'll set up a successful Roth latar conversion table for folks. Basically, it's just us mapping out over time, getting those funds slowly converted in a tax advantageous way to where we can't hurt you too much. It's never too late to do that. We do our planning 20, 30 years out. People are living longer. People are retiring earlier. So just imagine if you don't have to worry about whatever the heck these knuckleheads do up in Washington and you don't have to worry about it if they raise the tax rate to 80 percent. Well, 80 percent is zero zero folks. So I can't get any more passionate or excited about this topic. You know, it just has to be done. So give us a shout, please. There you

Speaker1:
Go. That phone number once again, three five to six one six zero five one one local offices to serve you. They'll come to you and they have webinars as well, where you can do a zoom meeting, whatever the case may be. Always pick up that phone. Three five to six one six zero five one one take point on retirement. Check it out. Google it. Eric Arnet, lead advisor, retirement planner in our studio. As always, so much information that's important to you. They've helped so many in the past. Let them help you now. We'll be back. Vokes right after this. Are you looking for financial peace of mind? Simple investment advice, planning, portfolio management, estate trust, retirement. Look no further than take point, wealth management, investment and tax advisors to lead you into retirement and beyond. Protect your assets, investments and retirement dreams taking point in your financial future. Take point wealth management is ready to take point on your retirement, leading you every step of the way. Take point welcom. Yeah, take point, welcom Google it now and check it out for yourself, that's stress free retirement is what it's all about, tax free investments as a big bonus, and they'll lead you take points in that direction. That's take point wealth management. Eric Karnad, lead advisor, retirement planner, along with certified public accountant rainI Woodruff in our studio once again in this pre-recorded pick point on retirement. I'm going to turn it over to the professionals in just a second. But there's so much more than what we've heard already. They also offer a portfolio risk analysis, client control of our assets all times, money management, risk management, advice from someone with your best interests at heart, tax planning, trust, estate planning, insurance services all through take point, wealth management could lead you and take point on your retirement or in

Speaker3:
The kind of double back to the Roth IRAs. And our listeners may have for years not really focused on Roth IRAs, but they probably were told that they made too much money and they couldn't contribute to a Roth IRA. And that was true in twenty eighteen, when then Congress passed a new tax plan, they raised the income thresholds up significantly. So now quite a few more people are able to contribute to a Roth IRA where they couldn't before. And with income tax rates going down, now's a great time to talk about Roth conversion. So if our listeners are hearing us and reading information online on the Internet about Roth IRAs or more specifically Roth conversions, it's because of the twenty eighteen tax legislation that really bumped up the limits and dropped the tax rates to allow this to become a more important topic for our listeners today, and more importantly, where we think tax rates are going to go in the future.

Speaker2:
So, no, not a great point. And I think it's important to decipher the differences between a Roth conversion and actual just, you know, setting up a Roth and making Roth contributions. So two totally different things. And yeah, you're right. I mean, it used to be that folks were phased out pretty quickly on both of those, but now pretty high earners can make Roth contributions. You can also make Roth contributions, even if you have a 401K and are making for wanky contributions. We can go ahead and get that set up for you guys. We've got some young listeners out there, and unfortunately, some of our younger folks are never educated on get started on your Roth now. Never started to really never start too early. But a great news is it used to be on Roth conversions where let's just be specific as to what this is. Let's just say you have a hundred thousand dollars in your 401K or your traditional IRA. You can actually take that entire amount and roll it over into a Roth. You'll pay the tax on that amount. But there's no limits anymore as to income limits, as to who's eligible to do that. They've lifted that so you can make five hundred thousand dollars a year. It doesn't matter. You can still do this Roth conversion.

Speaker3:
One of things I'm talking to with my business clients right now, especially that have been affected by the pandemic, their income is probably down and may even have losses this year. This would be a great year if you are a business owner and you've been negatively impacted because of Covid. Now's the time to start planning, you know, for the end of the year what you think your income is going to be and perhaps, you know, roll some money out of your traditional IRA into a Roth IRA and soak up some of those losses if you didn't want to carry them forward or carry him back to prior future years. But that's an option, too.

Speaker2:
So and that's a great point. That's a great point. That leads us to our next tax free strategy that we utilize a lot for clients and that it's called an IYU. Oh, it's an indexed universal whole life policy. Let's break it down and keep it pretty simple. Listen, folks, this is what the wealthy do all day long with their money as they're planning for their retirements and also planning for a tax free transition of their wealth. It's such an underlies tool and you don't have to be wealthy to utilize it. I want everybody out there to listen to this and get some information. Dive and talk to your current advisor. Give us a call. Get on the Internet. Google it. But index universal life is basically a whole life policy. Let's just use an example. Let's say you got one hundred thousand dollars sitting in the bank and it's really not doing anything. Well, guess what? You could take that hundred thousand fund, a universal whole life policy. That money is going to grow inside that policy. Tax free market like returns with no risk. Ok. Because what they do is they take your money. They invest it in U.S. Treasury bonds, very safe bonds. The insurance companies take that interest. They simply buy options on all the different stock indices that are out there.

Speaker2:
So your money's never invested in the markets. And typically, we've seen these policies returning six to eight percent, pretty continuously tax free. And then later on in retirement, if you want to borrow from that policy and live on that money or go buy an RV or go buy a boat or take a trip, that money comes out tax free as a tax free loan. So you're almost becoming your own bank. I mean, it's just an awesome strategy if you think about this, too. Let's say you have a substantial amount of money, 500000, a million dollars, whatever. You can roll it into this policy. You're going to get market like returns with no risk. No. Taxes. You can take the money out tax free. And from an estate planning point of view, guess what, folks? That money is completely safe. Nobody can touch it. Creditors liability enough. Nobody can come at that and break that. It's it's rock solid, protected. And so it's a great estate planning tool as well. And they've become very advanced. They're great tools for people to utilize. If you have exhausted some of the other opportunities, this is a great one to kind of park some money and get that tax free growth and all that safety with it. So true. Just another great, great, great strategy.

Speaker3:
And I think our listeners should be. And you said something early on about which during this segment are these are the things that the wealthy people do all day long. And I think that our listeners may have a perception that these strategies are only for the wealthy and some other things we talk about on our show. And that's not so true anymore. You know, 20, 30 years ago, they may have been true, but with technology, a lot of the strategies that were once thought of as only available to the wealthy are now much more available and very easy to transition into and out of four people with a whole lot less wealth. So I want to make sure everybody doesn't think that just because I've only got five hundred thousand, I got a million, that I don't really have any real options for myself. There are a lot of strategies now that are available to people with with average, modest, meaning me. Well, that wasn't available to them 10, 15, 20 years ago. So I don't think that you don't qualify for some of these great strategies are definitely highly recommend you come in and talk with Erik. And I. I think you're going to be pleasantly surprised at some of the options you're going to find.

Speaker2:
Yeah. Randy, let's talk about that for a second, because one of our more recent clients comes to mind as an a great example for folks. The gentleman is about 52 years old. Through our planning, he decided that he had about twenty five thousand dollars a year that he wanted to invest in to ten year universal life policy. And so he is planning on continuing to work and defer his money or his income until he's 67. So he's going to invest for 15 years. Right. But he only has to do it for 10 years. Hmm. So when he turns on the income, it was illustrated when we worked with this policy that he'll actually receive at age 67, forty five thousand one hundred dollars for the rest of his life. Guess what, folks? These also carry a death benefit. So this gentleman was going to have a five hundred and forty thousand dollar death benefit for his wife and his two daughters when he passes away. So think about that. That's forty five thousand dollars a year in tax free income, and it's

Speaker3:
Tax free and tax

Speaker2:
Free.

Speaker1:
It's free, and that's a big risk free

Speaker2:
For the rest of his life. He was smart. He got going early. He's contributing twenty five thousand dollars for ten years. That's all he had to do. So that's 250000 dollars. See, I'm a math. I'm a math rocket scientist. So the guy puts in 250 over ten years. It's kind of a five hundred and forty thousand dollar death benefit. And he's going to be able to live on 45000 dollars a year for the rest of his life tax free. And think about this. He would have been in the 32 percent tax bracket. Right. So in a tax free equivalent basis, that would have been fifty nine thousand dollars that he would have to have made from one of his other investments to meet that same amount of income. So great point, Randi. Let's not just talked about and talked to those that are kind of already at that point, you know, in retirement. But these younger folks that are in their 50s, 48, 49, 45, whatever, later this year. This is an awesome strategy. I love this stuff because I'm getting goose bumps right now because we utilize the same strategies and our own personal wealth planning. And I go to sleep at night not really caring about all the crap that's on TV and all these tax. Just tune it out, folks. It doesn't matter. There's politics and potential tax raising and all this all this stuff that's going on. It's freaking people out. Stress and people get in here. Get your plan going. They get a plan. You get a plan. They get a plan. Can't just sit around and hope that it happens. We got to put it into action. Right.

Speaker3:
If you come in and plan with us, you're going to hear about these opportunities like the IUUL. I don't think most people know really about. They may have life insurance. They have to work that. It's a group policy and they have a small policy. But in that they abort your earlier life or somebody bought for them. And I got a policy, my dad, Bahrami, I was born. Nice to have it. Great policy. And I was a lot of money paid into it over the years. You know, I think it's important that people realize, again, there's so many new products out there that have come along the last 10, 15 years that aren't just for the wealthy, it's for everybody.

Speaker2:
Yeah, that's a great way to fill your income gap. If we plan ahead and know what your guaranteed incomes are going to be and what your expenses and budget might be, you might have a little gap there where you need to come up with some more guaranteed income. Plug this and boom, you get your guaranteed tax free income fills that income gap. Happy retirement.

Speaker1:
Your future is safe and secure with products like this through take point wealth management, folks. That's why I recommend and suggest you give them a call now three five to six one six zero five or. On one. Check it out online. Take point wealth dot com. Eric Arnette, lead advisor, retirement planner, certified public accountant. Randy Woodruff in our studios with us as part of take point on retirement, giving you that stress free retirement. And once again, securing your future.

Speaker2:
I want to jump into how folks can set up their own personal pension. Well, you know, I think with increased uncertainty in the markets, increased uncertainty and tax rates, we've got some strategies that once again can reduce that risk, reduce those taxes and reduce those fees. If we can do that for you. Guess what? Can I make big, big dividends for you long term in your retirement

Speaker1:
Indexed universal life policy? Is this one that we can also roll an IRA into, or can we bind them together somehow?

Speaker2:
No, you can't do that. Ok, great question. But it's a good question. Awesome question.

Speaker3:
Sometimes people have a lot of money tied up in an IRA, right. When they want to be able to use to make this investment. And sometimes you can use your IRA for investments. But unfortunately, as Eric just mentioned, this is not one of them.

Speaker2:
Right. But what what you can do is almost like the Roth conversion. Right. Let's say you do have your money tied up. Go ahead and take some out. Pay the tax on it now to lower tax rates and fund your uyou. You with what? Those moneys and with future tax free growth and then future tax free income. We can show you on a chart how that blows up and just saves you tons and tons of money. You can certainly get active with any funds that you have, whether it's non retirement funds or retirement funds. But great question. Thank you. Let's take a

Speaker1:
Pause for station identification. You're listening to 1999 FMW, GB, Homosassa. Eric Arnette is an investment advisor, representative of Retirement Wealth Divisors, LLC. And as he registered Viter Take Boying Wealth Management, this station and RWA are not affiliated. Exposure to ideas and financial vehicles discussed should not be considered investment advice or recommendation buy or sell any financial vehicle. This information should not be considered for tax or legal advice. Individuals should consult with their professionals specialized in fields of tax, legal accounting or investments regarding the applicability of this information for their situation. Past performance is not a guarantee of future results. Investments will fluctuate and when are redeemed, maybe be worth more or less than when originally invested. Oh, there you go, folks. The answers you're looking for. Take it from me. Take point wealth management three five to six one six zero five one one take point on retirement. The name of this show brought to you by take point wealth management. Get to them now before it's too late. We'll be back. We're talking about a stress free retirement and all the products available to you at your disposal from the professionals in our studio this morning, once again on this station at this time. Right back, folks. Take point wealth management is on a mission to honor, protect and utilize the values, ethics and principles learned through military service to our country, to our community, building strong relationships, investment tax advisors guiding you every step of the way into retirement. Take the advice of someone with your best interest at heart. Take the hand of a leader. Take point wealth management will take point on your retirement today. Take point wealth dot com citrus. Hernando Pasko on the nature coast of Florida. Tax free investments, IRAs, Roths in particular in the index, universal life policy. Now for the good news as I turn it over to Eric Garnette, lead advisor, retirement planner, and Randy Widra, certified public accountant with theG Point Wealth Management.

Speaker2:
I wanted to talk to folks about how they can create their own personal pension. So one thing is for sure, throughout the years, more and more folks have been losing their pensions or, you know, corporations, companies are just no longer offering pensions and they've put this responsibility for saving for your retirement on you. Hmm. Quite frankly, the tool that these pension funds companies use is pretty much the same thing that we use. But I think it's even a little bit safer. And I'll talk a little bit about that in detail. Two types of annuities. Ok. Sometimes annuities get a bad rap because of back in the day. I think they were blank or at least sold to the wrong people at the wrong times. And listen, annuities aren't for everybody. That's true. But and that's why when you sit down with a professional, they should be very objective and utilize and show you all the tools that are available out there. However, because of the fact that folks are losing these pensions and these guaranteed incomes and these safe accumulation investments, I really like the utilization of annuities and retirement for some portion of your wealth. Mm hmm. And what's interesting to me is that it's taken a while, but even now, Orisa, which is the Rissa Act, your your government bodies that kind of regulate pensions, have now approved and introduced annuities into four one KS and four three BS and all that. That's great. Yeah, it is great, because folks want kind of that safety net guaranteed income. Right. Now, think about it. Interest rates are rock bottom low. I mean, you could a 10 year treasuries paying like, what, one and a half percent and

Speaker3:
Some crazy low.

Speaker2:
It's just a crazy, crazy level. Now's not the time to buy bonds or or get into fixed income. And so it forces people to kind of take that risk that they don't need to take and go into the stock market, try to pick up stocks. That might be risky because they're paying a dividend. Right. Because people just need that interest. So interesting enough, I was reading an article the other day that bonds and bond funds are currently trading at about a hundred and thirty five times their earnings. That's how expensive bonds are right now. So getting into bonds right now is absolutely not the right thing to do. Think about the stock market itself. The S&P 500 is trading at about twenty to twenty three times earnings. Wow. Bonds are trading at 135 times earnings.

Speaker3:
So now be the time to maybe if you have a bond fund to sell it.

Speaker2:
I tell you what. Absolutely. You have to think about that because you've taken a lot of profit in those bonds and those bond funds. And going forward, you just don't want to be invested there. So we have bond alternatives and we utilize index annuities to help fill that gap. But there's two types of annuities out there. You have your guaranteed income annuities, and then you also have just your safe accumulation. Annuities, depending on your situation, will kind of depend on which one is best for you. But all of the actuaries out there and all the economic prize winners and your smartest and brightest folks out there say don't take more than four percent of your overall principal value to live on throughout retirement. You're going to be careful if you're taking more than four percent and you lose some money in the markets at the same time. That can be devastating. So these index annuities offer some stability and some hedge against that, and they'll give you some more guaranteed income, a more predictable outcomes to where you don't have to worry about market downturns and corrections.

Speaker3:
A client came in yesterday. The major life situation happened in her life in terms of a death of a spouse. And her investment adviser rotated her portfolio, sold most of the bonds, and she was talking to a friend of hers. And her friend was panicking, like, oh, my God, you're investing just all your bonds, like it was a bad thing. And so our listeners should realize that there there's a time in your portfolio when you should have bonds, you should not have bonds. You'd be buying bonds, not selling bonds. I think the point you're trying to make is the annuity takes all that takes most, if not all the uncertainty out of that decision. And it kind of takes the place of that fixed income, guaranteed income. Right. And that you don't have all the fluctuations or the decisions you had to make with with buying into like a bond fund or buying bonds himself to get the guaranteed income. You can get that with the annuity and have all the safety and consistency.

Speaker2:
Yeah, imagine imagine if you have some money just sitting in the bank. Think, oh, that's where it's safe. I just want it to be where it's safe. And I can access it and grab it. And I get that. I understand the emotion behind that. But think about this for a second. The money inside the banks, they're they're taking your money, giving you no return on it. And they're Lenine lending it out at six, seven, eight percent. So they're making they're making money off of your money and get. That's what that whole FDIC insurance thing that they tell you, oh, don't worry, you're up to 250000 safe with us. We'll research it, folks. You can go out there and read about it. There's only about three to 10 percent of FDIC deposits that are actually insured. They can't insure all. Think about all the money that's in the banks right now. They can't insure the FDIC can't insure all those deposits. So your money really isn't safe by just sitting there in the banks.

Speaker3:
I had this conversation with someone yesterday about. Yeah, yes. This FDIC guarantee they give Chase Bank, Bank of America, Wells Fargo. Due to your point, if you have money in there and you're worried about it, they guarantee and Chase Bank fails. We got much bigger problems than an FDIC guarantee and being able to collect on that show. Right. To your point, it's not really it's a guarantee. But what's a guarantee with or guaranteed by? Right. And not much.

Speaker2:
Well, and that's why people kind of think, wow, well, that must be risky. Put all my money in an insurance company and better off being in this big name brand bank. Guess what? No, absolutely not. That big brand name insurance company is a lot safer place to have your money parked, because by law, by regulation, they have to have 100 percent of your money invested in U.S. Treasury bonds. Right. So they have your money invested in the safest investment that's out there. And then they take that interest. Right. And they purchase index strategies to try to give you a return on your deposit. And also, in some states, I know for sure in Florida and Georgia, they actually do have some guarantees for your deposits, but your money is 100 percent safe. And these insurance companies, because it's by regulation, they have to have to have one and a half times the deposits with them on reserve. So not only to have your money on reserve and have it insured that way, but they also have your money invested in U.S. treasuries, which are 100 percent safe. So if the banks fail or anything goes wrong, guess what? You don't care if the banks are failing.

Speaker2:
In fact, I remember back in 08 when banks were failing and I had clients in annuities, we never skipped a beat. I mean, nobody worried about an insurance company going down, kind of a false security, just having your money sitting there in the bank. It's just sitting there rotting and deteriorating, actually, because if you factor in inflation, you know, it's you're losing money, actually, so you can get your money working in a safe. There's also an annuity called safe accumulation, where you don't have to pay any fees. You might even get a bonus on your money. Your money grows tax free while it's inside the annuity. Right. And it's also free for market risk. But you're still seeing great returns, six to eight percent on average and those types of products. So another way to set up a guaranteed pension for yourself in the future is where you don't have to worry about what's going to happen. All the unknowns out there in the markets, we can alleviate a lot of that fear and give you so much more predictability with some of these products and tools.

Speaker3:
It's a different way how we help clients achieve that stress free retirement as well. And we're trying to help them achieve what we talked so much about on the show.

Speaker1:
And we're talking to annuities, accumulation based annuities, a great way to build your own personal pension. I see this thing and I've heard about this thing called an income, a writer. Is that what you paid for or is it just paying the annuity company a certain amount each year?

Speaker2:
Yeah. Yeah, no. Great, great question. So and that's why folks have to be really careful when you're purchasing or planning on maybe utilizing an annuity. And if you have an existing annuity out there, we can do what we call an annuity stress test. We can take that annuity and do a full analysis on it and tell you exactly what your rider fees are or what you're paying, what your performance has been, and what you can expect in income. So basically, there are annuities that you can purchase what they call a guaranteed income rider based on the amount that you put in, based on your age. They're going to tell you in the future, if you should decide to turn on guaranteed income, what that amount will actually be, they'll show you in a chart. If you put one hundred thousand and today when you're 65 and you want to start drawing on this, we will guarantee you some percent. I'll just say five percent as an example. So they're going to give you five percent on that 100000 plus it's growth over five years. So say the 100000 grows to one fifty. Hmm. Now they're going to say, okay, we're going to give you a five percent guarantee withdrawal rate on that one hundred fifty thousand for the rest of your life. Once you start that withdrawal, it will reduce the principal. Also, throughout that time frame, you're paying one to two percent fee for that rider. So what happens is and what we see quite often in our practice, when people bring these in and we take a look at them form Dave been paying this income rider for a long, long time. It's been eating away at their returns, and they never really even plan on utilizing the guaranteed income part.

Speaker2:
So they just paid all this money for this rider in this fee that they never utilized. So that's why we're real, real careful when we're recommending them. And it's really in a small case or small instance. Where we're putting that guaranteed rider on, there are some folks out there that just love that guaranteed pension. But you've got to be careful because you are paying for it. If you start to withdraw, say, four percent, and you're also still paying that fee, now you're drawing down your account for five percent, that account eventually over time will go to zero. But what they're going to do is still guarantee you that payment, no matter what the size. And the company will still try to keep up with the rate based on returns that they're getting in those indexes and stuff. But it's a little difficult to do. So it's got to be real careful with that. That's why we tend to sometimes lean towards those safe accumulation. And we would no writers, no fees, let them grow. And then later on, if you want to start taking money out of them, you can you can take up to 10 percent of them penalty free and and their R&D friendly. So when you do reach the R&D age, they're going to give you Ahmadi's no penalties. I just kind of lean more toward let's get that good, safe growth. Keep the fees at a minimum. So just be careful, folks, when you're out there, a lot of times, a lot of times insurance guys will just sell your annuities. They don't even know what the riders on there. There's really no need to pay that fee if you don't have to. So just be real careful with that.

Speaker3:
Just quickly talk about what process you go through as we are looking at annuity companies to recommend one of their products to our clients in terms of rating the company, what kind of companies we look for in terms of how strong and how solid they are.

Speaker2:
Yeah, great point. I mean, when you're evaluating insurance carriers, it's so important to make sure you're looking up their ratings. And so there's some independent rating companies out there called S&P Ambas Moody's, and they dissect that company and the strength of that company. And so all these companies have solvency reports, solvency ratios, and they have ratings. So triple-A rating, ALMOS, AA plus rating him highest rating will be. So we're always looking for those AAA rated companies and we're only going to utilize those top rated companies that are have the top financial strength. So, yeah, there's a lot of times folks will be sold an annuity or whatever, and it might look really, really great in those. Think about those lower rated companies have to really boost their features and benefits and rates to attract you, to get you away from to distract you from that lower rating. And so you're putting your money into a company that might not have the strength that one of the larger ones with with a better rating would have. So we're looking at least triple B rated or above. And so we have the screening to do all that. And we also have a screening tool that finds the very best performing ones out there in the country. So we've got it all right there at take point and kind of get you get your two and two and three successful retirement for sure. Excellent. The number one thing I wrote a book about it and I call it What is your financial speed? I have an article I wrote with Fortune magazine.

Speaker2:
What is your financial speed? I love to get it out to you folks. You can go on my Web site, take point wealth management dot com up in the right hand corner, you'll see financial workbook button or even set an appointment and just click on those buttons and you can share your information with me and notify me that you, you know, have these questions or concerns or want to get the book or the article. I have some great white papers on that kind of stuff. So what is your financial speed? What it means is what type of returns do you need to be getting in retirement? How is your portfolio allocated and what kind of returns is it averaging over the long term? But most important, what is your withdrawal rate going to be? What percentage of your portfolio are you going to be withdrawing? There's so many factors there that are crucial. And the what's the number one concern, folks not running out of money in retirement. Right. So it's ideal. It's so important to figure out, number one, what your budget is going to be, you know, how much you're spending. Right. We always talk about that amount of money you spend in retirement is a crucial factor in determining the type of lifestyle you're going to live. But it's also important for ensuring you don't run out of money. Right. So how much can you comfortably take out of your accounts each year is unique to you? Each listener out there is very unique.

Speaker2:
We talk about the four percent rule as a kind of a blanket rule, but that's a blanket rule across the board. It may be different for everybody, depending on how your portfolio set up and and also how much you're taking out. So the number one thing is what are your expenses? How much more will your financial needs differ in retirement from the ones you have while you're working? Lower expenses are going to lead to smaller withdrawal rates and higher expenses to a bigger one. Right. So don't underestimate your expenses. It's kind of crazy to me, but it's not I guess I don't want to beat people up, but I'll sit down with a couple that's 60, 65, and I'll say, OK, what's your budget? What are your expenses? And they just look at each other and like, we have no idea. We're just kind of been making money blindly spending. This is about 98 percent of the folks that I sit down. So that's why I always harp on on this show. I'm trying to get through to people like this is the most important thing is to your fiscal health, the number one. The first thing we're going to talk about when you come down, sit, sit down with us is what are your expenses? What are your expense goals? What are you doing in retirement? What does retirement look like to you? It's really broad things. Are you traveling? Are you gardening? Are you fishing? Are you boating? And buy that RV? I just had a couple in the other day.

Speaker2:
They just they bought their dream RV and they're going to travel around in their RV and they're happy as heck. And I think that's awesome. And we've been able to work with them throughout the years to achieve that goal. And that's so exciting to us as a team. They're on point. They know exactly what they're spending and they know exactly what their expenses are. And then we can even plan ahead for what potential expenses or increases are coming, like inflation. It's very important, folks, that you're planning for inflation, because guess what, all this spending that's going on with Uncle Sam right now, if you've noticed, silent killers, little increases everywhere. And so interest rates are going up. Inflation is increasing, OK. And that gets into a whole nother thing about portfolio construction. And what how do you combat that? We can talk about that later, but don't underestimate your expenses. Let's even be able to put a little bufferin like we talk to folks and say, OK, yeah, let's put a ten thousand dollar a year travel budget in there. We put that in and make sure that's in the plan. Right. So if the rate of withdrawal that you've calculated is too high, it could lead you to running out of money and you should work toward eliminating unnecessary expenses before you retire. So that's the number one thing is Erica and I talk about it all the time, like weekly what our budget budget and you know, what are we saving this week? What are we doing? You know, always.

Speaker2:
Yeah. And most people don't want to talk like if you have had a spouse, a long term spouse, Autum, you know, the folks that I work with them with long term spouses, they well, we don't like to talk about that stuff because we just get an argument. And I'm like, I understand because I've been there and I've been there in previous relationships, let's say. And my parents, I viewed that. I saw them fight over finances all the time. My grandparents, I mean, it's it's 99 percent of all families and couples have this issue. Yeah, right. And that's why it's so important. You have to just bring down the bring down the argument level, the level of stress a little bit and talk about it and just talk about what like we actually talk about what our goals and what we're going to be doing in our retirement, like what are our plans? You know, we and we we say, well, we and we both love the fish. We love to be on the water. We love to go camping. We love to travel. So that's part of our budget. And so we're saving we have a special account that we're saving for travel. And it may be it may mean I mean, Eric and I, a perfect example. We love to go out to eat and entertain all that kind of stuff. And actually, I mean, I guess kind of Covid or into that a little bit.

Speaker2:
But we were saving more because we said, you know what, I turned 50 and a lot of light bulbs went off for me. I'm like, might maybe 10, 15 years from retirement myself. No. One, I'm going to get healthier, but I'm also going to get fiscally more responsible about where I'm spending my money and save more, because the more I save, the more comfort I'm going to have, you know, and knowing that I'm going to be able to get two and three times. And also, if something should happen to me, I want to leave my wife enough money to live comfortably. Right. So we've got to be thinking about our spouses and but just have that conversation. Start talking about your expenses, get that budget in line. I just worked with a younger couple. They're like forty five years old. I've been married for quite a while and and came into some money. But they also they they never talked about budget or what they were spending. I don't know how I got money going to hear money going. So let's get control of that spending first. That's the most important thing, right? And then what is your rate of return on your portfolio? You can have a high rate of spending, but your portfolio is allocated to a low average return. That's not going to work. So how much you earn each year on your investments will play a big role in how much you can spend. Right. So if your accounts earn 10 percent each year on average and you're taking out four percent, then you will be growing at a rate about six percent a year.

Speaker2:
Right. So that's great. You're still going to be able to grow, but that's if you're allocated to average 10 percent in this scenario, you can probably afford a higher rate of return than if your accounts are only earning five percent on average. Some people just have a low risk tolerance and might not have enough in stock. They might have too much in bonds or I know a lot of people, some money sit around in cash because they're afraid to do something. That money just sitting there rotting. So that asset allocation model that drives your rate of return shouldn't be based solely on how much you plan on taking out from your accounts. But investing in a portfolio as too aggressive for your investment profile could also be too risky. This is a fine balance there. So if you have a real high risk tolerance and you can't sleep at night because your portfolios in the markets, but you need to get a higher return, there's a little bit of a rub there. Right. So we've got to be able to find that comfort zone for you, that happy medium where we're allocating your portfolio properly to get the right amount of return to to cover your expenses. So that's the number one thing that I see out of whack with people when I sit down. First and foremost, that's the key

Speaker1:
Problem sitting right here in front of me, Eric Arnet, lead advisor, retirement planner would take point wealth management. Randy Woodrum, he certified public accountant. He's usually. With us

Speaker2:
Every week. I think the key word that comes to mind for me, I was reading a Facebook post. One of my high school buddies was up in Indiana, and he's just built. I mean, he's buff. I mean, the guys in the gym like two, three hours a day. And his keyword is I don't like going to the gym. You know, I don't like doing this kind of stuff, but it's discipline. So discipline, discipline, like if you get a little more even a tiny little bit more discipline in your life, it doesn't have to be a bad word. All right. It can actually bring harmony and peace in your relationship, discipline to make some healthier lifestyle choices. Right. Discipline to put that budget together and kind of stick to it and have open communication with your spouse. It's just about a little bit of discipline, you know, implementing a little bit more discipline.

Speaker1:
And I think, Eric, with your background in military as a veteran, you learned a lot of that through the military experience as well, so.

Speaker2:
Oh, yeah, absolutely. I mean, that that was beaten into my combat veteran buddies that we get together with every once a year. I looked at these guys around me. They're all just natural. I mean, just great leaders, you know. And every single one of them. And they would be willing to jump up and take point and take the lead. And we talk about our retirement warriors out there. So one of you out there listening right now has to be that retirement warrior for your family, for your for your plan, for your spouse or your jump up and take charge and take point. Give us a call and we'll take point and help lead you to and through retirement, a healthy retirement, a happy retirement, a stress free retirement. It's all about lowering those that stress.

Speaker1:
There you go. Yeah. In the military, they're fighting for our country. And in your family, you're fighting for your future in that financial future. Let take point wealth management take point on that, give you that stress free retirement that you deserve. There you go. All the tools are available in that tool chest that is being offered to you at BTIG point, wealth management. They've got all the products, all the tools to help you through a stress free retirement, as well as some books as well, the stress free retirement book. And of course, that free advice, consultation, financial analysis. And don't forget to ask for that book. What is your financial speed by Eric Arnet, lead advisor, retirement planner, take point wealth management. Get those questions in at info info at take point on retirement dot com. We'll see you next time. 1999 ZUBY This has been a big point on retirement brought to you by Thade Point Wealth Management.