[00:00:00] Speaker A: 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.
[00:00:17] Speaker B: You're tuned into the Retirement Planning Pipeline, the show that helps you take control of your financial Future. Whether you're 5 to 10 years from retirement or just getting started, we've got the strategies, tools and experience to help make the most of your nest egg. Retire Retirement Planning Specialist David Pipes is a trusted voice in retirement planning, helping Americans navigate 401 rollovers, income planning, tax strategies and everything in between.
Now let's dive into today's show and start paving the way to your smooth retirement. Alongside retirement specialist David Pipes, here's your host, Jim Tarabakia.
[00:00:52] Speaker C: Hi everybody. Welcome to this week's edition, a brand new episode of the Retirement Planning Pipeline, the show that delivers expert insights, actionable advice and real world financial strategies to help you retire confidently and comfortably. Thank you for making our show a part of your weekend. I'm your host Jim Tara alongside my co host, Retirement Planning specialist David Pipes. David will be along in just a moment. Retirement Products the good, the bad and the misunderstood. Understanding the purpose, costs and trade offs behind your choices. Coming up on today's show, we'll explore how your investments, savings and insurance can work together to support your retirement income, spending and goals. Plus, we'll examine what financial guarantees actually protect and the fees, restrictions and trade offs that can accompany them. And common assumptions about retirement products, guarantees and financial recommendations. That's all on the way. But first, before we get the show started, I want to encourage our listeners to go ahead and schedule that 100% complimentary consultation with Retirement Planning specialist David Pipes today. It's a free offering just for listening to this show. Our listeners can meet with us to review their own financial situation for your family or for your business. And there's absolutely no obligation. Visit retirement planningpipeline.com to get started. All right, David, welcome in. Let's get the show started with this no product is the plan choosing tools around your retirement needs. And as you approach retirement, you may have accumulated a variety of financial products along the way. A 401k from a former employer and investment accounts, CDs, life insurance, or perhaps even an annuity. And each one may have served a different purpose when you actually purchased it. But here's the bigger question. Do you know how all of those pieces fit together to support the retirement that you actually won. I like to think of it like a toolbox. Having a hammer, a drill and a saw doesn't necessarily mean you know what you're building the same as a lot of people. By the way, the same is true with the retirement planning. It's not just about what you own. It's about how those assets work together to help generate income, manage risk, and support your goals. So, David, how do you take all of those individual pieces of someone's financial picture and turn them into one big, successful, coordinated retirement strategy?
[00:03:01] Speaker D: Well, Jim, first of all, good morning to everyone out there. Beautiful Sunday, beautiful weekend after the hurricane. Looking forward to, you know, getting into the end of this year. We have a lot coming up with the market volatility, but that's. Jim, you're talking about the exact same thing that I push every single day when I've talked to anyone in retirement. And the basics, you know, it's really, really simple when you break it down. If you don't have all your tools, Jim, in that toolbox, there is no way to be able to retire efficiently. And I think people always get this raw. And I think it's not the people's fault. And I say this all the time, Jim, and you know this about me.
A lot of the times they're going towards the financial advisor for that help.
And it's tough to put this out there, but a lot of the financial advisors are just wrong. These companies aren't looking out for the best interest of the client. And it's sad because when you look at it, these tools should be used differently for every single client. And that toolbox is needed Right. When you get in retirement, there is no, just one size fits all. One hammer is not going to be able to screw a screw in. Right. That's kind of the idea where the retirement's different than just being able to have a financial plan for your lifetime on your, in your career side, or when you're putting money away for retirement and you're saving and you're investing, it's a totally different route. When you start spending right now, you have to use different tools to be able to customize your specific plan towards yourself. And that's what I think. I really, really, you know, I, I push a lot of my clients to understand first when I meet them, because we're so brainwashed to think the market is everything for finance. We're so brainwashed to think, oh, well, the market is where it's at. Market's only thing we can do. Either you Buy this security or you buy that security and you're taken care of. And if you want non risk or if you want less risk, you buy this. If you. And I think everyone's so caught up where all the money is feed and where all the money is held, which is the brokerage accounts, the IRAs, the big corporations.
And we're not looking at the bigger picture of using the toolbox to be able to create maybe, you know, no risk for clients or income for clients, or maybe even plan certain legacy plans down the road for clients. I've seen a lot of people who want to give money to their kids but don't know how to tax efficiently. And they're just being ran and keeping their IRAs inside the market. And it's strictly right.
The majority of people that are retiring have these qualified assets, 401ks IRAs, the toolbox, the tools that you're talking about, Jim, have to be separated. The IRA and the 401k turn into something totally different when you retire. They're supposed to turn into income, right? So now the tool that we used forever growth, right, Maximizing in the market is now not the tool, right? That is the full plan for the client at that time. Because if you think about it, you know, to be tax efficient, IRAs are the worst tax efficient, you know, strategy to give your kids, right? You had the secure act coming in.
We have to distribute the IRA in 10 years. You have ARM Ds, right? You have.
Those IRAs can get big, right? That's what happens when you build that wealth. All of a sudden the kids are paying a higher tax bracket. And I know people always say, I don't care where the money goes. But you do. If you don't want to care, you don't want to pay the IRS instead of your kid, right? Or even your husband or your wife. You want to pay them the most money, not the government. So, you know, I think that there's a big play in the toolbox thing that we bring up. And Jim, I love that we're bringing that up first because if we don't have all the tools in that, in that toolbox, we can't create as a financial advisor, the most efficient plan for that client.
[00:06:55] Speaker C: Right. And, and David, for someone who has accumulated several different accounts and financial products over the years, a lot of people too, I would think. I don't have an exact number, nor do I have a citation, but I would think a lot of people are in that situation. How can they tell if everything working together efficiently or if they have gaps, unnecessary overlap, or money that could be put to better use.
[00:07:19] Speaker D: I think the only way to do that is to be able to find someone and meet with someone that has all the tools. Jim.
[00:07:24] Speaker C: Okay,
[00:07:25] Speaker D: and I, and it, it's, it's tough to explain and I know a lot of listeners, a lot of you guys out there. Well, whether you're on the podcast or whether you're on live on the radio show, it's tough for you guys. It's not easy, and I understand that, you know, and, and I'm one of those people that I'm seeing, you know, and it's, I'm seeing every step of the way where these people in the retirees or the pre retirees think they have everything that they, you know, because their financial advisor has done whatever they can for them for 20 plus years.
And it's just not happening, you know, and, and I know it's more of an emotional route than anything else. And that's what, that's what hurts is finance should be numbers only, right? So I think that the first thing you need to do, Jim, is if you are retiring or pre retiree, look at your options. Go to three or four different people, see what they say, see how they treat you, see if they're, any of their plans are different, right? See if they're looking towards what your goals are, asking the right questions, asking what you want in retirement, right? Hey, how many times do you travel? Where do you want to go, right? What do you want to do for your grandkids? How much do you spend on Christmas, right? Do you want to do anything extra that you don't think that you can do, right? With the funds that you have, what makes you happy? Why'd you retire in the first place? All these questions are things that I think that people miss out on, right? Because it becomes a kind of an emotional trap where they think that either the, the advisor that they, that they have or their money is, is safe. Oh, I've been with this guy for a while. It's just, it's just normal to me, right? Or I've had my money here for a while. It's normal to me, I'm telling you. And you can take this or you don't have to take it at all. If you leave your money where it's at, right? And you retire in, the plan's not changed. I'm telling you, it's the wrong plan, okay? Retirement is a whole different world, okay, Even pre retirement, than being able to save and invest your Money over the long term. The toolbox, like Jim likes to say, is not much of a need. When you're in the beginning, investing the toolboxes comes in when you needed to start diversifying and having different ways to invest or have your money in different places to create wealth and accumulate an income in different places. Right. So I, you know, I think that what, what you're asking Jim and, and to be straightforward with a lot of the, you know, a lot of the listeners shop, get your, it doesn't cost you anything. Get yourself out there. I mean, we're, we're a free consultation. I, I don't charge anyone to come meet me. Not one person. Right. I think that's literally highway robbery. Okay.
You should be able to find whoever you want and really whoever you end up liking for what your plan is, that's who you should go with. Right.
I tell a lot of my clients, you know, if they go to seminars and dinner seminars, please go, you know, see what's out there. And the idea is the advisors should be doing the same thing, right? We should be looking at innovating our products, innovating who we are, innovating our plans, looking at our clients plans, understanding who they are, knowing them, you know, but I feel like that's lost a lot of the times now, Jim, and that's my one, that's my one big thing is don't get complacent, don't get stuck. I'm telling you, 99% of you out there, maybe even 99 point something percent of you out there could have a better plan or do have gaps. And, and it's just, it's something that I, you know, I see every day. So I can say that, right? And whether it's you come to me and call me or not, or call someone else, you gotta call someone. I don't care if you call Joe Schmo in Tampa or go over to Arizona or Texas. Just try to start helping yourself out. Right? And I think that's the first step.
[00:11:15] Speaker C: Well, again, a product can address a specific need. A retirement plan connects those tools with your income, spending timeline and goals. Start with what your retirement needs to accomplish. Then evaluate whether the pieces you own can help you get there. So do you know how your investments, savings and insurance fit together? As David mentioned, a complimentary consultation can help you review what you already own, identify potential gaps, and discuss how those pieces support your retirement goals. So visit us on the
[email protected] or pick up the phone and give us a call at 850-565-1705 to schedule your complimentary consultation.
All right. Later on in the show, common assumptions about retirement. But up next, when guarantees can help and what they cost. This is the retirement planning pipeline. We'll be right back.
[00:12:02] Speaker B: Visit Retirement Planning Pipeline to schedule your free, no obligation complimentary consultation today. The retirement planning pipeline will return in just a moment.
[00:12:24] Speaker A: Retirement should feel secure, not uncertain if market swings have you feeling uneasy. You've probably heard about annuities, but what aren't they telling you? You deserve the full story. That's why we created a free guide that explains the good, the bad, and yes, even the fine print. Inside, you'll learn how annuities can create guaranteed lifetime income, what fees and surrender charges may apply, how the different types of annuities really work, and whether an annuity makes sense for you. It's clear, straightforward information so you can make a confident decision. Call Amerilife now to get your free guide to annuities, the good, the bad, and the fine print. Call 866-554-9546. That's 866-554-9546.
[00:13:03] Speaker B: Silex annuities contain withdrawal charges, interest and bonus recovery and market value adjustments that may apply to withdrawals made during the retirement period. Silox annuities are products of the insurance industry and not guaranteed by any bank nor insured by FDIC or ncua NC USIF Not a deposit not insured by federal government agency. Guarantees are based on the claims paying ability of the issuing insurance company. Restrictions apply. May only be offered by a licensed agent.
[00:13:24] Speaker A: I am speaking with Deb Wittman with aarp. She's actually the executive vice president and chief public policy officer there, former staff director for the Senate Special Committee on Aging, as well as an author, economist and global aging expertise. Deb, thank you so much for spending some time with me. I am looking forward to this conversation.
[00:13:43] Speaker E: Thank you so much for having me today.
[00:13:45] Speaker A: It is a great conversation to have because it's about your new book called the second 50 answers to the seven big questions of Midlife and Beyond.
This is obviously something that, I mean, you know, you've focused on aging for quite a long time.
You know, why are you so passionate really about helping people through this sort of second half of their life?
[00:14:12] Speaker E: So I've been working on aging for 25 years and then I was about to hit 50 and realized there was so much that I didn't know that I was curious about and wanted to learn. I looked at my Bookshelf. And there were things like what to expect when you're expecting, or my kids were about to go to college, so I had tons of book about that. But there was no what to expect when you're aging.
And so I wrote down a list of questions that I wanted to know, and those became the chapters of the book.
[00:14:40] Speaker A: Nice. And so talk about those, if you will, and kind of maybe. What are some of those seven big questions that you've kind of ventured to answer here?
[00:14:49] Speaker E: Yes, some are basic, like, how long will I live? Will it be another second? 50?
Will I be healthy? I looked at practical questions like how long am I going to work? And will I have enough money?
And then I ask some tough questions like will I lose my memory? And how will I die? And I talked to experts all over the country. I did a survey of the American population, and I talked to people and heard their stories, and that all came together in the book. And I'll say, you know, some of the things that I knew. And then when there was a lot that I didn't.
[00:15:24] Speaker A: Yeah, I was going to say, you know, what are maybe some things that, that you discovered in there that surprised you in the, you know, research and writing process?
[00:15:34] Speaker E: I think one thing that surprised me was how important our relationships and our mindset are to our health and longevity. So most of us know about the five healthy habits that we should do. Things like eating right and exercising, not smoking, not drinking, maintaining a body weight, that's going to gain you about a decade of life.
But if you don't have relationships and you feel isolated, that's the same as smoking 15 cigarettes a day. So we need to maintain our relationships. And then even more surprising to me was how important our mindset is to our future aging.
So if you view aging as a positive time, if you think about growing older as a time of meaning and purpose and the ability to give back to your family and your community, you live seven and a half years longer, you are more healthy, and even your brain volume is higher.
So things like relationships and mindset are just as important as eating right and exercising.
[00:16:46] Speaker A: Wow. And that really is, I think that goes to a lot of what we talk about in a lot of our shows on Retirement Radio Network, and that is stress, particularly because we talk a lot about money and preparing for retirement and all of that. And stress can really do a number on your health. People say, oh, well, I, you know, I'm stressed out. It just, you know, it makes me feel stressed out. It makes me feel bad in the moment, but it can take its toll over time. So I think that that is a great point to bring up here and obviously something that, that you've covered in the book.
And, and you know, I mean, this is such a growing part of our population as well. So I think this is such an important, you know, topic to cover in a book like this.
You know, I think it was by 2030, one in five Americans are going to be 65 or older. Right. So, so what do you think maybe are some of the most pressing policy issues as this sort of, you know, baby boomer generation and then even into Gen X gets into sort of retirement age.
[00:17:51] Speaker E: So you're right. We have a growing aging population and we need to look at all of our programs like Social Security and Medicare and even understand that there's a growing need for things like long term care, not just to help older people, but the families that have to take care of them. And we need to make sure that those programs are strong for older people today, but also there for future generations who are going to need them even more.
[00:18:17] Speaker A: Yeah, absolutely. Right. Well, just about time for us to start wrapping up things here, Deb. But I just want to give you the last word. If there's anything that you wanted to mention that we haven't talked about here that comes to mind or you know, maybe where folks can go and find out more about the book.
[00:18:31] Speaker E: Well, you can find it in your local bookstore or you can go to aarp.org second50. And just a point, given your topic of your show is how important our work is to our later Life. We have two times as many people over age 55 who are working today than in the 1990s. So retirement is no longer time without work. It is often a time while you're still working a gig job or a part time job or just a job you love doing.
[00:19:03] Speaker A: Yeah, that's right. I mean you can retire, you could reinvent yourself. There are so many different things that you can do in those traditional retirement years there. Well, Deb Witman, AARP's executive vice president, Chief Public Policy Officer and author of the Second Fifty. Thank you so much, Deborah. Really do appreciate your time.
[00:19:24] Speaker E: Thanks for having me today.
[00:19:26] Speaker B: Welcome back to the Retirement Planning Pipeline alongside retirement planning specialist David Pipes, here's your host, Jim Taribokia.
[00:19:35] Speaker C: Welcome back to the Retirement Planning Pipeline. Thank you for making our show a part of your weekend on WCOA News Talk 104.9 with new episodes every Sunday at 10am and as we dive back into today's SHOW Reminder if you like the content we're providing, subscribe to the YouTube page YouTube.com and search Retirement Planning Pipeline for weekly video highlights and special content. Retirement planning isn't about chasing the next hot investment, about making informed decisions. That's why we'd like to send you a complimentary copy of our educational guide, the Good, the Bad and the Fine Print. Understanding Annuities for Retirement Confidence. Inside, you'll learn how annuities work, the different types available, the potential benefits, the trade offs, and the important contract details you should understand before making any decisions. There's no cost and no obligation, just straightforward information designed to help you become a more informed retirement investor.
Call us today at 850-565-1705 or visit us on the web at retirementplanningpipeline.com to request your free copy. When Guarantees can Help and what they Cost Understanding the protection, the price and the Trade Offs A guarantee can make a part of your retirement more predictable. So before committing, understand what it covers, what conditions apply, and what flexibility you give. Again, earlier we discussed why each financial product needs a clear purpose within your retirement plan. Now let's apply that idea to one reassuring word, guaranteed. Let's address two questions here. What exactly is guaranteed? Your principal, an interest rate, or an income payment? And the next question matters just as much. What does that protection cost and what restrictions actually come with it? So, David, when it comes to retirement, one word that can make people feel more comfortable is guaranteed. And understandably so. I mean, you've spent decades saving and last thing you want is unnecessary risk or whatever the case may be, whether your money will be there or not. And having to answer that question. But a guarantee is a little like an insurance policy. The protection can be valuable, exactly what you're getting and what you're giving up in return. So when someone is considering a financial product that offers a guarantee, what exactly should they look at to understand what's protected, what it costs, and what restrictions they may be accepting in exchange for that peace of mind?
[00:21:51] Speaker D: Yeah, Jim, I think that, you know, guarantees are, are a great part of retirement and they have their, they have their piece, right? Guaranteed income, super, super important. And if you're out there and you're thinking about, hey, look, I'm taking income, but I'm, you know, it's going to run out or I'm worried about running out. Guaranteed income is one of the most important parts of the retirement plan if you need it, right? So if that's a question in your mind, you need to sit down, look at that kind of stuff. And I help a lot of clients with the guaranteed income portion. The other one is guaranteed rates, okay?
And why these get funky is because you can have multiple different types of guaranteed rates, okay? So guaranteed, no loss, but a guaranteed fixed rate. And you have to be careful, okay? Because some people what you don't understand is, is that these rates can change, right, In a certain format, right? So if you get into guaranteed rate, that's, that's absolutely amazing. But know what you're giving up, okay? You're giving up your money for a certain amount of time that you cannot touch, okay? So it's a five year plan. If it's a seven year or ten year plan, yeah, you're getting your guaranteed, right? You put a million bucks in, get your 5%, you make 50 grand for 10 years, okay? But they keep that million bucks and they're able to use it if you want to get it out. That's where the surrender charges come in or the MVA charges, okay? This get very, very complicated.
One thing I would also really approach on the fixed side, if you're looking for a fixed rate, okay, make sure you have a broker that can shop all plants, okay? I cannot stress enough how many people go with a guaranteed annuity or guaranteed CD and they end up getting a rate that's literally 1.5 or 2% lower than what the highest rate in the market is, okay?
Different companies come out with different rates to be able to get business, all right? And there's a lot of, you know, high end companies out there that are offering great rates. Don't get stuck with going to an advisor or going to a bank, right? Or one specific company and getting that rate shop just like you do insurance, just like you do anything, right? If you're going on Amazon, you find the same product for cheaper on Amazon than you do in the store, you buy it on Amazon, it's the same dang thing. I can't stress enough how many times I've walked into a client's house and they bought a rate a month or two before I met them. And I'm like, well, did you know, blank, blank, blank, pull it up, you have 10 companies above it. Don't be that person, okay? So the guaranteed rates are great, okay? But understand the length of terms, how long you're getting it, what this renter charges are. How do you get your money out if you need it, okay? Because obviously everyone wants that once that, that conclusion. And the last thing is make sure that you know what other Companies and what rates are out there, right? We're, we're a brokerage. I'm a brokerage. So I, I can deal with every major carrier in the country, okay? We can look and shop every single carrier and pick which one we want. It's pretty much like an ALA card here, right? Banks in certain financial institutions are different, okay? They can only, they only are contracted with certain companies or certain carriers. Don't get stuck in that, all right?
You know, find yourself a way out to where you can have someone who can offer everything just like that toolbox that you named earlier, Jim. You know, I think that's super important. Have a toolbox to where you can have five different screws or five different hammers, okay? It's a lot better than just one hammer, right?
Also looking more into the guaranteed side, I want to go back to income and I want all you listeners to hear this, okay? If you don't have, I would say if you don't have a safe feeling about having your income taken care of in retirement, you need to have that fixed, okay? If you have bills or you have stuff that you need to pay, you want to travel, there's things that need to be coming out and you're taking money out of your retirement plan consistently, you need to look, at least look at guaranteed income setup for yourself, okay? It will save you in the long run, I promise you. Okay? In 10, 20 years from now when you're like, I have no more money, David, now we're talking about why we do this stuff and we plan early, take care of it now, it will mess you up in the future, all right? But I think that, you know, from the guaranteed side, the income and then the rates are the most, two important things, Jim, that you have to carry your toolboxes to use.
[00:26:21] Speaker C: That's, that's the word of today's show. I think toolbox, it's, you know,
[00:26:25] Speaker D: why not? I mean, it
[00:26:26] Speaker C: fits. Yeah, it
[00:26:27] Speaker D: does fit. It does fit.
[00:26:29] Speaker C: And again, a guarantee is worth evaluating by the concern it addresses and the trade offs it requires. As we discussed earlier, the product is one piece of the plan. It's protection that should support the bigger picture. Do you understand what your retirement guarantees cover and what you pay or give up for them? We can review your current assets, discuss your goals and help you identify potential gaps during a complimentary no obligation consultation. So give us a call today at 850-565-1705 or visit us on the web at retirement planningpipeline.com this is the retirement planning pipeline,
[00:27:04] Speaker B: helping you take control of your financial future. This is the retirement retirement planning pipeline.
[00:27:21] Speaker C: Every October, the ordinary gives way to the eerie when ghosts, goblins, skeletons, and all the things that go bump in the night come crawling out of the shadows. And somehow we're perfectly comfortable opening the door to strangers and giving them candy. But there's another kind of scary that tends to show up around this time of year. You may know it, you may have experienced it, the financial scary. I'm Jim Tarabakia for the Retirement Radio Network powered by Amerilife. As we enter the final quarter of the year, millions of Americans are thinking about the celebrations ahead. But for some, there's another feeling creeping in the uncertainty that comes with their financial lives. NFCC CEO Mike Croxton details to CNBC the financial stress Americans are facing this fall.
[00:28:07] Speaker F: There's a tipping point where consumers free cash flow at some point will not amortize their outstanding unsecured debt. And that issue is simply creeping its way up the income and age ranks. And that's really what the forecast is telling us this quarter.
[00:28:24] Speaker C: Maybe it's the thought of opening your investment statement after a rough week in the market. Maybe it's an unexpected medical bill. It could be inflation quietly eating away at your purchasing power.
Or maybe as retirement gets closer, there's one question that keeps coming back. Will I have enough? Planning for retirement means confronting a future none of us can predict. But even with today's financial environment creating uncertainty, BlackRock's head of retirement Jamie Margera tells CNBC, There can be reason for optimism when it comes to retirement readiness.
[00:28:55] Speaker G: What we found this year was some great news, right? People are actually much more confident about their retirement readiness.
So 68% of savers think they're on track to have the retirement that they want, which is great news. Like they have optimism. They're confident about it.
[00:29:11] Speaker C: Maybe there's a lesson behind the financial scaries. The things we don't understand tend to feel bigger when we're standing in the dark. Sometimes the best thing you can do is turn on the light. Take a closer look at your retirement plan. Ask the uncomfortable questions. Understand where your income will come from, what risk you may face, and where there may be gaps because you can't predict everything that lies ahead. But you can prepare for it. And while the ghosts may disappear when Halloween is over, financial uncertainty doesn't necessarily disappear with them. For the Retirement Data Radio network powered by Amerilife, I'm Jim Tarabagchia.
[00:29:54] Speaker B: Planning for retirement doesn't have to be overwhelming. Get expert Insights, tools and personalized strategies to secure your future. Visit retirementplanningpipeline.com today. Your retirement, your plan, your peace of mind.
[00:30:11] Speaker C: This is the retirement planning pipeline. If you've missed any part of today's program or want to catch up or even listen to previous episodes, go ahead and subscribe and listen to the show in podcast form on Apple, Spotify or wherever you get your podcasts. We're on all the platforms.
[00:30:27] Speaker B: And now for some financial wisdom. It's time for the quote of the week.
[00:30:35] Speaker C: All right, our financial wisdom quote of the week comes to us from one of the founding fathers of the United States, Benjamin Benjamin Franklin. And Franklin said, quote, tell me and I forget. Teach me and I remember. Involve me and I learn. Benjamin Franklin providing us with this week's financial wisdom quote of the week. You know how we involve people. Well, those free complimentary consultations. Visit us on the web retirement planning pipeline.com and again, a quick reminder to be sure to visit us retirement planning pipeline.com. leave your questions and we'd love to answer them on the air. So again, visit us@retirement planningpipeline.com for more.
All right, good product, wrong person. Ask the right questions before you commit. A product can work exactly as designed and still be a bad fit for you. Understanding your circumstances and asking clear questions about a recommendation can help you recognize a possible mismatch. So consider this. A friend tells you about an investment or an annuity that you absolutely, that they absolutely love. And you know, you wonder to yourself, should you consider buying it too? I get this a lot, by the way, at the gym with everybody pushing their peptides on me. And I'm always saying, all right there, slow down, Peptide Pete. So their experience, it's no different in finances. Their experience may be worth hearing, but their finances and spending needs and retirement timeline could look very different from yours. Everybody's journey is different. We've talked about that on previous episodes as well. You know, earlier in this show though, we discussed product roles, the trade offs behind guarantees. Now let's bring those ideas into the buying decision. David, how do you determine whether a recommendation is actually a fit for, for you?
[00:32:10] Speaker D: I, I think, you know, first off, I'm going to go back to the quote and, and, and, and I love when we do this, Jim, because, you know, it gives people a way to understand and kind of, you know, put two and two together.
I can't express enough how important it is to be able to, as a financial advisor to educate your client. And this is something that everyone's missing out on. Right. Because a lot of the times it's, give me your money and let me do what I do best. And you don't have to worry about it. You come to me with questions whenever you want to, but you really don't know what's going on, so you don't know what questions to ask. Then it's too late. Then you're really confused. Then you have no idea. Then you got to kind of scramble around and you don't even know. I mean, how many people that I've met that do not know what the heck their plan is. And gosh darn, if that's how you want retirement, I'm sorry, that's exactly how you're going to get it messed up. If you're not getting at least educated a small amount on what the advisor is doing for you and how it's being planned, that's the most important part. So when Ben Franklin says, involve me, and I learned that's the difference. We have to involve our clients, Jim. So I think the worst part is, is that we're so stuck in that modem where we just put money away our entire lives and it's okay. Okay, that's fine for when you were doing that. Now you have to take money out. You have corporations taking money from you. You, you have fees coming out. You have biases everywhere, all over the place. And you have a large amount of money. You have to be able to now plan accordingly and teach yourself, not yourself, sorry, have us involve you and be able to kind of tutor you on the small things. You might already know them. And I'm not saying we have a whole class on it. What I'm saying is like. And I do a lot of these in my seminars. I ask the questions. If you don't know, I tell you why they're right. And if I'm not doing that, if I'm not asking you questions and involving you, that's a mishap on my part.
[00:34:01] Speaker A: Right.
[00:34:02] Speaker D: We need to take care of the clients and have them educate themselves so they want to learn more. I love when clients call me and ask questions because it shows you care about what's going on, why it's going on, and, you know, you want to make sure your plan is correct. And a lot of you out there, I hope do. We're just. You should earn the trust of your client. And the way you earn that is to be able to educate them so they understand where their money is, not everything about it, but understand what the plan is. It's their plan. It's not the financial advisor's plan. We are not them. So it's our job, I believe it's our job to be able to look at the retiree and say, hey, who are you? What do we have to make? Your retirement plan. Your retirement plan, not mine. For you. Better and more efficient for your goals and needs. Not for the advisor group, not for putting you beside everyone else. Or this person got this product and this person got that product, so you can get the same one. Let me pitch it. Let me sell you it. There are so many people that do that. And I'm telling you, I get a lot of people out of this, but they lose money, they lose time, and they're not efficient at all with taxes. So all these things can be taken care of by just making sure that you're educated and you know what's going on in your portfolio. Please, please, get it checked out. Sit with an advisor, sit with four advisors until you find one that can really sit down and get to know you and understand what your goals are. But if you don't know your client, that's just not going to be the way to do it, right? So recommendations are great, but there's no recommendations at all until you really know the client, right? So for all you folks out there that are, you know, hopping on the train of, well, that person's got that and this person has that. I want that it's not going to happen like, and if it does happen like that, and you go chase that, I'm telling you right now, there's big circumstances down the road. If that recommendation doesn't fit your specific plan, right? You have different liabilities. I say this all the time. Different mortgage payments, different assets, different inheritances, different kids, different grandkids, different travel ideas, right? Different health problems, different ages. All these factors go in together. And everyone wants to try to pitch the same thing or put the same portfolio in the same person or the same age group. And it's just, I'm telling you, it's not efficient. Right? The 6040 portfolio. We've talked about this, Jim. The 6040 portfolio does not work for everyone anymore. It just doesn't. And there's mathematics to prove it, right? So get ready for that. Put yourself in the position to be able to have someone work for you and not for the company or not for themselves.
Have them really, I mean, seriously sit down and get to know you. And until you find that advisor, keep meeting them. I'm telling you, they're out there. Okay, but you have to be able to sit down with someone and really look at your plan individually and figure out what you want to do. How many clients come in my office and they've got to go home and think about things because they've never been told the things that I'm telling them or asking them. They're like, holy crap, I've got clients worth millions of dollars. They're like, well, David, you.
You kind of stumped me, man. I've never been asked that question.
How are you 65, 66, 66, 67 years old and never been asked, hey, you know, what do you expect to, to do next year?
Right? What do you expect to, to go on trips? I'm hoping you're taking trips, right? What do you want to do?
Right? How, you know, are you, are you given enough money? Do you, you know, do you have enough income or is there more income that we need to give you to suffice that.
But no, it's, oh, well, you let me know when you need money and I'll give it to you. Because it's all about the companies, and we have to put an end to it, Jim. We have to. So on the recommendation side, there should be no recommendations.
Okay? It should be strictly what the client's goals and needs are and the solutions to fix those problems.
[00:38:00] Speaker C: Well, if I may, too, and you brought this point up many times in previous episodes about getting to know your client. And there's no one size fits all approach. I don't know if other financial advisors, retirement planning specialists, are using that approach. I don't know. But you've talked about, and it ties back into this segment about getting to know your client and understanding who they are. And the way to do that, I would think, and you've expressed this on previous episodes, is by understanding who they are and where they are in their financial life and in their retirement planning.
[00:38:37] Speaker D: Yeah, I mean, people are saying they do, Jim. And the hard part is, is that that's why there's so many mind games going on. They say they do, but when the portfolio doesn't change and it stays the same and there's the same ETFs or same mutual funds or. And there's no different vehicles. There's no new tools in that toolbox like we talked about.
Right. Going back to the tollbox, which there's. That's never their plan because they're taught by the corporation and, and really they're trained to do one thing right, and that's what. Keep money in the market. Keep money in the market, and then if they got to change it up in the market, they will. But when you have all these other tools and you're not using them because you're not trained to do that or you're not getting paid to do that, and you can't do that because you're employed by a company or you're tied to certain companies, then you're not looking the best interest for the clients. And I'm, I'm telling you, it's everywhere, especially in Pensacola. I mean, we're dealing with it everywhere, everywhere. JIM
[00:39:31] Speaker C: yeah. Well, bring one question to every recommendation meeting. What circumstances would make this a poor choice for me? As an example, ask the professional to discuss those situations as clearly as the potential benefits. A positive product review doesn't establish a personal fit. Clear questions and answers support supported by the paperwork can help you understand whether a recommendation belongs in your retirement plan. So do you have a recommendation you'd like explained in plain English? Well, during that complimentary no obligation consultation, we can discuss the circumstances, review your questions and help you understand how the recommendation fits your retirement needs. So give us a call at 850-565-1705 or visit us on the Web at. Retirement Planning Pipeline.
All right, coming up next, common assumptions about retirement products, guarantees and financial recommendations. This is the retirement planning pipeline. We'll be right back.
[00:40:24] Speaker B: Your retirement questions deserve real answers. Call 850-565-1705 to schedule your free no obligation consultation today.
[00:40:41] Speaker A: Well, American seniors are getting a raise next year in 2027, at least those who are Social Security recipients. The cost of living adjustment has officially been announced for the new year. And joining me here now to talk about that is Bill Sweeney, senior vice president of government affairs for aarp.
Bill, thanks so much for being here. Really appreciate your time. Thanks, Matt. Good to be here. It's great to have you. And I know that, you know, it's a bit of a good news, bad news kind of a situation anytime we get a COLA announcement because, yeah, you do get a raise, but you get a raise because there has been inflation in this current year. Right? I mean, what give us, give us kind of the top line here. How much are seniors going to see in their checks as far as an increase goes in that benefit amount next year?
[00:41:25] Speaker H: Well, the 2027 cost of living adjustment, the COLA, is 2 point is, I'm sorry, 3.6%.
And that is for the average person on Social Security, it's going to be about $75 a month or $900 a year. And as you mentioned, it's not, you know, sort of extra money. It is, they're really designed, it's based on the inflation rate that happened over the course of the last year. And it's designed to help you keep up with those higher prices. And so it isn't. Most people are not going to sort of feel like they've got a lot of extra spending money. It's going to be just barely keeping you up with the cost of rising groceries, rising gas prices, electric rates and all the things that people are struggling with right now.
[00:42:08] Speaker A: Yeah, and it's, it's interesting too, because the way that the Social Security Administration sort of bases the calculation of COLA adjustment each year is based on a particular measure of inflation, the cpi, the Consumer Price Index for it's like urban wage earners and clerical workers, I believe is the, is the full name of it. You'll notice it's not, you know, the CPI for American Seniors or anything like that. I mean, that seniors have sort of different needs as far as their costs. Right. And so you talked about this kind of barely keeping up. How are seniors sort of dealing with the inflation, the rising costs and all of that these days? Because as I say, their, you know, costs and expenses do differ.
[00:42:58] Speaker H: Well, they sure do. And when we ask people what it would, you know, whether this Coca Cola would be enough to keep up with the rising prices, 76% of them said, no, this wouldn't be nearly enough. And when we said, oh, how much would be enough? The vast majority of people, more than 70% of people, said a COLA of 5 to 8% is really what they would have needed to keep up with rising prices. And, you know, Medicare premiums are going to come out next month.
A lot of people are going to see those eat up a big chunk of their Social Security Cola as well. So it is a really, it is a really mixed story and it's a really tough time to try to figure out how to make ends meet with all the prices of everything going up, but especially health care, drug prices, all of that is a, is a huge driver of high costs for seniors.
[00:43:47] Speaker A: Right. And you sort of couple that with this sort of longer term outlook for Social Security and that seniors don't find a lot of comfort there after say 2032 or so when the trust fund is slated to basically go insolvent. Now that, as we've talked about before, that doesn't mean that benefits would then go away. But just, just clarify here, seniors could see a drastic reduction in their checks from Month to month. If that were to happen,
[00:44:16] Speaker H: well, 2032 is a hard deadline that needs to get, that Congress needs to get acting on right away.
I think it's important to note that that is six years away and that we have an election coming up in November that people get elected to the United States Senate who serve six year terms. They will be in office at the end, at the end of their term. They will need to decide what to do with Social Security. So this is becoming very real now from an electoral point of view and from, from a voter point of view. This is the time to, to really be focused on it. If you weren't focused on it before, but the truth is Social Security can pay about 80% of benefits kind of indefinitely at this point. The issue that Congress needs to fix is about that 20% shortfall that would happen in 2032 if they don't act. The good news is Social Security has been around for 91 years. That's never happened. We've come close in the 70s and the 80s. Congress has never let that happen. I believe that Congress won't let it happen because there's going to be a lot on the line for them if they were to do something like that to so many retired Americans and to the 185 million of us who are paying into Social Security right now. And we expect to get the benefits that we have earned. And so I think as voters go to the ballot boxes and start raising their voices about this, I think that can help clarify things for members of Congress who, who need to be thinking about this a little bit more urgently than maybe they have in the past.
[00:45:36] Speaker A: Yeah, if nothing lights a fire under someone on Capitol Hill, I feel like then electoral consequences. So we'll see, we'll see how that goes.
But yeah, I think I kind of tend to agree with that, that, that that will light a fire under them as well.
Now for folks who needs, you know, maybe some more information about Social Security, about, you know, how to sign up and all of that, I mean, there are, there are resources online, there are things that they can also do in person at local Social Security offices, those that were not closed due to budget cuts the past couple of years.
But what can people do? What kind of information is available for folks who are maybe pre retirees who are trying to get a better idea of what their benefit amount is going to look like when they do retire?
[00:46:27] Speaker H: Well, I encourage Everybody, whether you're 18 or 50 or older, to sign up for a Social Security account. Go to the SSA.gov the Social Security Administration website. Sign up for a My Social Security account. Anybody can do it.
And not only can you see all the information about every job you've had shows my first job when I was 16 working at McDonald's, that money is there. It shows up on the list of jobs that I've had. It tells you how much you can get if you claimed at 62 or 67 or 70.
But it also allows you to do stuff that you used to have to take a half day off of work to stand in line at an office to do so you can get a new so if you lose your Social Security card, lots of people do that. You can go to the website and request a new one from the comfort of your own home. There's lots of the things that you used to have to go to an office to do you can actually do now on the website. So we really encourage people to do that. Save the visit to the Social Security Administration for when you have a really complicated problem. Deal with some of these easier ones at home on the online.
[00:47:32] Speaker A: Well, very good. And I'm sure also that there are a lot of
[email protected] I would imagine for folks as well.
[00:47:39] Speaker H: We have a tremendous amount of
[email protected] Social Security where you can get all kinds of information about when to claim and what it means and what you should be thinking about as you make that tough decision.
As well as aarp.orgcola where you can get involved in the fight to save the COLA to protect this cost of living adjustment. Make sure that Congress hears from you and understands the importance of of this as we go forward.
[00:48:04] Speaker A: Yeah. Vitally important for American retirees. Well, Bill Sweeney, senior Vice President of Government affairs for aarp, thank you so much once again for being here. Really do appreciate your time.
[00:48:13] Speaker H: Thank you Matt. I appreciate you
[00:48:16] Speaker B: missed part of today's show. The retirement planning pipeline is available wherever you get your podcasts
[email protected]
[00:48:25] Speaker C: welcome back. Inside the Planning Pipeline, the show that delivers delivers expert insights, actionable advice and real world financial strategies to help you retire confidently and comfortably. Bring Tarboca here alongside retirement planning specialist my co host David Pipes. Thank you for making this show a part of your weekend on whichever platform of your choosing.
[00:48:44] Speaker B: Come on down as we test your financial knowledge in Right or wrong.
[00:48:55] Speaker C: All right, it's time to test your financial knowledge with a game called Right or Wrong. The rules are very simple. I asked David a series statements and he will tell us if my statement or question is right or wrong. So if you're listening on the radio or podcast side watching on YouTube, feel free to play along. All right, here we go. Number one, right or wrong, David. Buying several financial products means I have a coordinated retirement plan.
[00:49:18] Speaker D: A lot of people get this wrong, Jim. And, and I mean, that's, it's absolutely wrong. Okay, first of all, you've got to be able to coordinate those specific investments with what side of the plan they're going to. They have to be correlated with something. So one, if it's for income, great, okay? But if it's satisfying the highest income, great, okay. But if it's the next one's growth, okay, make sure it's satisfying the highest potential for growth, right? So, yes, that's the start. Okay. To be able to use different tools in the toolbox, to be able to use in your retirement plan, but they have to have a purpose and they have to specifically create a, an efficient plan or efficient side of the plan for that product or that investment vehicle.
[00:50:04] Speaker C: And that brings us to another important question about retirement planning. Because even when you find a financial product that looks appealing, the highest advertised rate doesn't always necessarily mean it's the best deal. So here's the next one, right or wrong? Money for next year's expenses and money for 15 years from now may need different treatment
[00:50:24] Speaker D: 100%. And Jim, I love that you brought that up because this ties in everything else, right? This ties into one big thing that I think everyone is listening, should be putting in their mind. And I'm going to ask this question and they can all answer themselves. Jim, is okay, when you're retiring, right?
When are you supposed to be using your money when you retire? When you don't have any more income, you're using your money soon, right? Well, when you are working and you're putting your money away, okay. When you were supposed to use for your money for retirement later, long term, right? So this goes along the same thing that I tell everyone. Why would we have the same plan that we did? Our entire lives stay the same.
So for that financial advisor or that financial group or that team that puts you in the market with your 401ks or maybe your rollover IRAs or whatever they are, okay? During the same dang thing that you were in your entire life, now that you're retiring, why are they in the same thing?
It makes no sense, Jim. It makes no sense. So, yes, you're absolutely right. They have different, they do have different, you know, treatments.
You're going to need to look at both sides of things when you're going to, if there's a, you know, maybe a chance that you might use the money in the next five years, 10 years, 15 years.
But in retirement, we want to be more safe than sorry. So yes, five to 15 or one year to 15 or five years, even one to five years, Jim, is super, super important. So we have to be able to look at that and make sure that the goals are assessed and taken care of.
[00:52:06] Speaker C: You understand when you might need your money. The next say, the next question, I guess, is how much protection you really need and whether a guarantee is worth the cost. Okay, right or wrong, every annuity provides the same benefits.
[00:52:21] Speaker D: That's absolutely wrong.
And you know, back in the day when they were first, when the annuity where was first made, that's when they did provide the same benefits. And I think people now don't understand annuities. I think advisors don't understand annuities because they're so complex and they're all math. And I, I do this on every seminar or every dinner that I do with, with either prospects or clients. And I, I tell them all, I said, look, what do you think an annuity is? And almost every single one of them is wrong. Right? Because annuities have changed dramatically over the years.
But back then they were literally just for income. Okay? Now we've got hybrids out there that can actually be great, you know, vehicles for growth with, you know, with the market, with market link gains. Right. But with no downside risk, which is super important. You can also now have vehicles that can have growth and income.
Right. Which they were, they were never made like that. Also back in the day, the annuity, right, you couldn't get your money back if you started income.
That was a, that's a big problem. All these people out there think they know what they're talking about and they don't. The advisors are wrong. And, and these products are very, very, you know, intricate. Right. But they have purposes.
Now, are they for everyone? Absolutely not. Right. But are they for certain retirees? Heck, yeah. I mean, I use a lot of them for certain retirees, but they have to, they have to have a purpose, Jim, like we talked about, they're a tool in the toolbox. But that tool has to be fit towards that purpose for that client, you know, so I, I think they're very, very under, you know, undervalued. I think people don't look at them enough. But I think that the reason why is because a lot of financial advisors don't Know what the heck they're selling or don't know what they're giving to clients.
So they're giving them the wrong product and it's messing up portfolios. I know a guy who runs around this area and sells specific products in a specific company, and it. It's just wrong.
Like we talked about earlier, you can't just. Not everyone wants of, you know, the same. Not everyone likes the same food or, you know, so it's kind of like that. It's just weird, man, to watch what he does and to watch these people get sucked in. And it's sad, Jim. It's really sad, you know, to watch these people go into an annuity. They don't even know what it is.
[00:54:42] Speaker C: Also, too, by the way, if you've missed.
Earlier in the show, we talked about that financial toolbox in segments one and two. So again, if you missed that, catch up on the podcast side. Apple, Google, Spotify, wherever you get your podcast. All right, finally, right or wrong, asking about alternatives can help me evaluate a recommendation.
[00:55:02] Speaker D: Yes, absolutely right, Jim. And that's what everyone should be doing is looking at alternatives, looking at what's out there. Shopping everything you can. Shopping the advisor.
Right? I mean, I always say that, you know, until you find the. You'll know when you find the right one. Right? I mean, it'll. You'll feel it. You'll feel the trust. You feel like they have the best interest for you because they give you the. All the options. And sadly, it's pretty easy to find that advisor because not everyone gives you all those options. Right? I mean, I have an appointment today with. With clients that, that have sadly already went with some things that I'm gonna have to change.
Right? Because it's better for them.
So a lot of these things too, you know, make sure that you're asking the right questions, asking for alternatives, asking what else you would do. Hey, look, here's my plan that blank and Blank gave me. Here's what's going on. How does this fit my goals and plans and does? Is anything else better? And show me why.
Right? Show me, educate me. Involve me. Like Ben Franklin said, involve me so that I learn what the heck I'm doing. It's my retirement. It's my money. Show me what I can do. That's the biggest part, Jim, that I think people need to do.
[00:56:11] Speaker C: Well, a recommendation should come with an explanation that you understand. We encourage you to ask about costs, compensation, alternatives, and what could make a proposed approach a poor fit. You should have room to ask questions and resolve anything unclear before committing money. Your initial consultation is complimentary with us and it comes with no obligation. Bring your questions, recent account statements, and any insurance or annuity documents that you'd like to discuss. Together, we can take a closer look about how your financial decisions support your retirement that you're planning. Be sure to visit us on the web@retirement planningpipeline.com or pick up the phone. Give us a call at 850-565-1705 and a reminder if you missed any part of today's show, don't forget to subscribe to the program in podcast form on Apple, Spotify or wherever you get your podcasts. Subscribe to the show on YouTube as well. Search Retirement Planning Pipeline on YouTube for clips and special content. Thank you for listening. This is the Retirement Planning Pipeline. Have a great week everybody. We'll talk to you next week.
[00:57:10] Speaker B: Thanks for listening to this week's episode of the Retirement Planning Pipeline, the show that helps you take control of your financial Future. Whether you're 5 to 10 years from retirement or just getting started, Retirement Planning Specialist is David Pipes has the strategies, tools and experience to help you make the most of your nest egg. Take control of your financial future and get started today by visiting retirementplanningpipeline.com and if you missed any part of today's show or want to catch up on past episodes, be sure to subscribe to the Retirement Planning Pipeline wherever you get your podcast.
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[00:58:33] Speaker C: Charles David Pipes is an individually licensed and appointed agent. Learn more@retirement planningpipeline.com Investment advisory services offered through Brookstone Capital Management, LLC, a registered investment advisor. BCM and Amerilife are separate companies but are affiliated through common Ownership Insurance. Products and services are not offered through BCM but are offered and sold through individually licensed and appointed agents. Registered investment advisors and investment advisor representatives act as fiduciaries for all of our investment management clients. We have an obligation to act in the best interest of our clients and to make full disclosure of any conflicts of interest.
Please refer to our firm brochure the ADV2A item 4 for additional information. Any comments regarding safe and secure products and guaranteed income streams refer only to fixed insurance products. They do not refer in any way to 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 Brookstone. Indexed or fixed annuities are not designed for short term investments and may be subject to caps or restrictions, fees and surrender charges as described in the annuity contract.
[00:59:45] Speaker A: Fixed annuities including multi year guaranteed rate annuities are not designed for short term investments and may be subject to restrictions, fees and surrender charges as described in the annuity contract. Guarantees are backed by the financial strength and claims paying ability of the issuer.
