2.17.23: Audio automatically transcribed by Sonix

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

Producer:
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.

Producer:
Welcome to Retire 360 with your host, Dwight Mejan. Dwight is a licensed fiduciary and financial advisor who always places your needs first. Dwight works hard each day to educate Americans like you on how to reach the financial freedom they've worked so hard for. And he can help you, too. So now let's start the show. Here's Dwight Mejan.

Dwight Mejan:
Well, good afternoon and welcome to the 360 Capital Management Show here at Retire 360 Radio and we are at the Retire 360 Show Dot Com. My name is Dwight Mejan. I am your host alongside me, my faithful son in law here, Mitchell Keiser and our executive producer always want to reach out to Sam Davis. Thanks, Sam, for being there. How are you guys doing this week?

Mitchell Keiser:
Good over here, enjoying this warmer weather that we've been having, that's for sure.

Dwight Mejan:
Absolutely.

Producer:
Yeah, I'm doing great as well. And you know, here in Atlanta, we're getting some great temperatures as well. It's a high of 68 today. So I'm hoping it's not a not a tease on this early spring, but we're enjoying the weather.

Dwight Mejan:
Oh, Sam's probably got the golf clubs out then. So we were trying to figure out last week between the snow skis out in the western part of the state and now it's at golf weather. So you got to love that about the Carolinas, right? We get we can have all four seasons right now in a day or in a in a matter of 24 hours, which is awesome. Hey, my name is Dwight Meghan. I am your host and I'm your guide for this next hour. Just want to acknowledge our our faithful listeners. Thanks for joining us and taking time out of your day. You know, you've heard me say it multiple times. This is your show. I appreciate the feedback. Many people call in and give us on some topics that kind of helps drive our outlines. And we want to make sure that we're bringing information to you that's both relevant and applicable to your stage of life and to your finances. Because our goal here simply is to help you win with your money. And that's what this show is all about. So want to also welcome some of our first time listeners who might be tuning in for the first time today. I know we've had people come and talk to us who have been referred to the show, so if you're new to the show and want to just give a special shout out to all of you and welcome you and also to let everyone know that if you, for whatever reason, can't catch a show, you can go download our show.

Dwight Mejan:
If you want to see it on YouTube, you can find us there on YouTube. We are Retire 360. If you just put that in the little search tab where you go to download shows, you can go to Spotify, Apple Podcasts. Wherever you download podcasts, you'll find our show, Retire 360 and come to our website, Retire360Show.com. There as well. You can book that complimentary consultation. We had a couple come in speaking of that that had been listeners of the show for a while and took us up on that complimentary consultation. They wanted that that free second opinion. They thought they were on the right track and they're doing some great things as we got to share with them. But it really led to another session with us. Complimentary, of course, but they learned after we asked them at the end of that first meeting, what prompted you to come in? And they said, well, you talk a lot about getting that second opinion and you just said something. Dwight that made sense is that if we had a serious medical condition, we'd certainly want to go for another consult with a physician with something as important as our retirement finances and our financial future and retirement to enjoy the retirement that we dream about.

Dwight Mejan:
We just thought it important just to get that second opinion. And when we asked them what they learned, they said, you know, we learned that there are some things that either have a good advisor, but they said maybe they're just not equipped in. We talk a lot about the tax plan and the tax mapping that we do just to make sure that portfolio is tax efficient. You know, it's great to save a large sum of money, but retirement is not just about saving a bunch of money. That's part of it. The bigger part comes in retirement because when you start to harvest income from that portfolio and you make decisions around Social Security and your pensions, all of that comes onto the tax return. And it's more complicated when you retire than when you're working. When you're working. It's simple, ordinary income, very easy to calculate things like the marginal tax rate, things that we talk about in our seminars. And we've had many people come through the door, through the radio to meet with us. They then come to an event that we had just last week, and I just want to let our listeners know, I know some of you this might be a little bit of a drive, but it's not too far. We have another seminar coming up on February 28th and that's going to be in Asheboro.

Dwight Mejan:
If you'd like to get a little more information from us, we do have some space available for that. It's going to be at the community college. It's about an hour. It's our most popular topic of taxes and retirement. We're also going to update you on some of the things that have come out of secure 2.0 as all of us in the financial world start to learn a little bit more about the benefits of that new law. And I will tell you folks, there are some great things that come out of that new 2.0 secure act. We will be talking more about that in the weeks to come. We've touched on some of that in prior weeks, but we've just got some good stuff there that we want to share and it's going to help a lot of you who are behind in retirement. I'll just tease you a little bit with that. There's some great opportunities if you feel like you're behind the eight ball with your savings, Secure 2.0 is written exactly for folks just like you. If you're listening right now and want to say this about 2.0, I think I said this in last week's show. Secure Act, the original one that came out in 2020 when it became law, was passed in 2019 that had about a dozen pillars on it that we say that centered around the retirement aspect for for folks as portfolio secure 2.0, almost ten times the number of changes.

Dwight Mejan:
So if you're not getting information and you want to know a little bit more about that, hey, maybe you can't make it to the Ashboro seminar that we're doing on the 28th, but do reach out to us. Go to Retire360Show.com or you can reach out to us by phone at (910) 235-0812. We're located right here in downtown Southern Pines. We'd love to have you just drop in the office and more importantly, just to sit down with you and have a discussion about where you're at in your retirement journey and we'll lay out for you what we can do to add value. To help with that, we'll run some analysis for you. It's all complimentary and we'd love to meet with our listeners. So that being said, welcome. If this is your first time and if you've been listening, thanks again. Just a little overview of today's show. We're going to talk about. This is our Smart Retirement Plan series that we're doing. We're going to talk about smart lifestyle, smart legacy and smart adjustments that you can make to your portfolio. We're also going to talk about our regular slot here about an inflation demonstration. Mitchell is going to walk you through that. And we're going to talk about how to beat the bank CDs. So with that, we're going to get started.

Producer:
And now Folsom Financial Wisdom. It's time for the Quote of the Week.

Mitchell Keiser:
So this was brought to you by Dave Ramsey, and that is financial peace isn't the acquisition of stuff. It's learning to live on less than you make. So you can give money back and have money to invest. You can't live until you do this or you can't win until you do this. So I know Dave Ramsey, he's he's pretty keen on getting out of debt, staying out of debt and building that savings account, which which I agree with. Did you something you're going to add to that? Yeah.

Dwight Mejan:
No, I think, you know, I love this quote. You can't win until you do this. You know, that's what this show. Mitchell, we talk about this a lot. That's what it's all about here is we want to help our listeners win with their money. And winning is there's a lot to that. It's not just, as I said earlier, saving a large bucket of money. It's how do you invest it, Where do you invest it? A lot of our listeners don't even know what their tolerance for risk is because they've never taken a valuation to really see does their portfolio how they're currently invested, particularly our listeners who are in the stock market. Am I in a comfort level where I should be? You know, if this market continues to go the wrong way? And we've had a pretty good run at the beginning of this market, but a lot of our listeners just just wonder about that and, you know, love the other thing, Mitchell, that Dave Ramsey said there about learning to live on less than you make. I knew I grew up in a blue collar home. My dad drove a truck for Pepsi-Cola for 36 years, and he drilled two things on the middle of three boys. He drilled two things into our heads when we were young. One was to live within our means, and number two was to save for a rainy day. And you know, my dad, you know, he was right on the money. It's not rocket science, But he says it's it's easy to build wealth if you have discipline and you have time. And I always used to think, you know, as a kid, you know, you got to make a ton of money to really be wealthy. And it's interesting how many people we have as clients and many people that we meet who had very simple, average jobs that literally are multi-millionaires because they started early, they were disciplined, they got good counsel, and they stayed the course. You know, the the tortoise and the and the hare. Right. You know, the tortoise wins the race. Absolutely.

Mitchell Keiser:
Well, I'm going to use that quote as I get in here to smart lifestyle. That's our first topic today. I just want to remind folks, as Dwight kind of said, our goal is to help you live the retirement that you've worked hard for. We'd like to help any of those that want a consultation. We can help you look at that to help you build a smart plan in order for you to fund that lifestyle. Remember, if you want to travel more in your 60s and 70s and your 80s and beyond, it's important to make sure that your retirement plan takes those goals into account. You don't want to outlive your retirement funds. You want those funds to outlive you. The happiest people that we meet. I know as clients that come in and out of our office or people that are living within their means, as Ramsey kind of said, I read this article this week. It was by CNBC. It was talking about the the amount of people that live paycheck to paycheck. Dwight, do you have any idea what you think that would be? What percent of Americans live paycheck to paycheck you don't even know?

Dwight Mejan:
You look that up. Mitchell If I had to guess, I'm going to say it's about 60%.

Mitchell Keiser:
Well, you're close. So back in December, it was 63%. So 63%. More than half of Americans are living paycheck to paycheck. And unfortunately, that is including a lot of people that are on Social Security. So it's kind of scary when you think about it. Wow.

Dwight Mejan:
Yeah, that is that's very scary. You know, Mitchell, you just talked about something. I want to bring Sam here on a minute because this you read a little thing here that you were talking about, I should say, on traveling abroad and retirement. Just before the show started, three of us were kind of chatting and Sam's got a trip planned at the end of the the year here. Sam, where are you headed again?

Producer:
My wife and I are headed to check out Italy for a couple of weeks at the end of September. In the beginning of October. We're looking forward to it and the plans are coming together.

Dwight Mejan:
That's awesome. Well, Sam, how old are you again? Tell our audience. I don't know if I've ever asked you that. And Sam doesn't know. I'm bringing them on to ask him this, but I wanted to hear about it.

Producer:
Yeah, no problem. No problem at all. I will be turning 28 in just a couple of weeks.

Dwight Mejan:
So the old guy leading the show here, 54, went to Italy about three years ago for the first time. And I'm I'm proud of this guy going to Italy because it tells me he's doing something right to be able to save and be able to travel abroad because that's one of the passions that my wife and I have, is to travel. We love to do it together. We love to do it as a family. And I just think that's cool that you guys are heading that way. I know you're going to have a great time, so if y'all want to reach out to Sam and give him some feedback on where to go. If some of our listeners have been to Italy, he's compiling a little list of some places, and I was telling him down on the Amalfi Coast, he's got to get the single chairlift on the way up and anacapri he's got to go up there to do that. So if our listeners have been to Italy and you want to help Sam out, I'm encouraging you just go on the set appointment. And we'd love to have you have the appointment, but you can put a note in there and say, Hey, I just want to give Sam some advice and I'll make sure we pass that on to Sam for his trip. Pretty cool. Well, good deal. Well, we want to talk just a little bit here. Last week I did not get through the retirement income gap, but I want to pick up where we left off there.

Dwight Mejan:
Mitchell just talked about smart lifestyle. And I want to talk about what the retirement income gap is so that our listeners know what that is. According to the NHP Foundation, there was a study done that 62% pretty close to Mitchell's statistic. He just shared on how many people live in paycheck to paycheck. 62% of baby boomers believe that Social Security will provide at least half of their income during retirement. And we got a little statistical data here for you about Social Security, Social Security benefits. No surprise to people that alone is not going to be enough to maintain your standard of living in retirement by many standards today, in formulas that are out there, two thirds of what you make right now in or in working years, if you're still employed to enjoy that same lifestyle. It's estimated that roughly two thirds of that income is what you need in retirement to enjoy that same lifestyle. And the assumption there, of course, is the debts are gone. You don't have a mortgage, kids are out of the house, so you don't have some of the expenses with dependents there. But that is a pretty accurate number and I think it's a great number to work backwards from to kind of see, hey, are we going to have that income? Can we get to two thirds? What does that look like and how do we work those numbers backwards? We won't get through a ton of that, but I'm going to touch on that here in this little segment.

Dwight Mejan:
The average monthly benefit for Social Security right now is $1,542 per month. That's a total of 18,000, roughly $500 per year annually. So the maximum monthly benefit, if you're 62 today, this is the maximum is $2,364. That means you would have had to contribute the most money for those 40 quarters, ten years into Medicare, if you're 70, the maximum monthly benefit. And we talk a lot about this show about looking to determine, hey, when should you take Social Security? Should you wait delay to 70? A lot of that's going to depend on your portfolio. What's the size of your assets both in pre tax accounts and post tax? There are strategies that we look at on these complimentary analysis that we do to show people based on current tax rates. Here's what you could expect to pay if you were taking this much money out. And we have to find out what's what is that income gap, which we're talking about here. But at age 70, the maximum benefit is $4,194 for a total of 50 little over $50,000 per year. 76% of retirees. They say that income stability is a top concern for their retirement, as it should be. And what is this retirement income income gap that I'm referring to? Well, if we start with our core expenses, what our core expenses that would be basic living necessities, food, clothing, shelter, taxes, health care, health care needs. If we take that plus discretionary expenses, which is eating out entertainment, traveling, our wants, those types of things, if we subtract that by the guaranteed income sources that we have pensions and Social Security, that leaves us with our retirement income gap.

Dwight Mejan:
So I'll say that one more time real quick. It's the core expenses that you have for running your household, paying utility bills, food, clothing, shelter. Plus, I got to add that discretionary money in there, that's the fun stuff that we do, eating out entertainment, our wants. If we subtract that from our guaranteed income sources, which is Social Security and pensions, those are the typically big two. That leaves us with that retirement gap. So how do we fill the retirement gap? We got to make sure, number one, that you're saving enough money during your highest income years. Had a couple come in here yesterday who had moved here from the West Coast and they had sold a home and they're what I call their income rich, but their asset poor. And I'm not picking I'm just simply saying a lot of people come in and they have that scenario. They've got very healthy guaranteed incomes, but they don't maybe have as much saved on the retirement side. And my question to them was I said, do you know what your income gap is? Have you heard of that? So they left here actually are doing a budget because one of the things that came out of that meeting is one of their goals is they recognize the fact that they have a healthy income.

Dwight Mejan:
They just aren't they don't have a plan in place to save money out of that income. And they want to do some things, but they also want to make sure they're growing their assets, which we're a little bit light for their ages. So we're working on a plan for them right now to help them see what they can invest that money in that fits their risk tolerance. And we basically built a financial plan for them. We're going to follow up and have another meeting to go through how they can. Make that a reality. So if you're in those highest earning years, we call it, you're in that red zone, that retirement red zone, you're within five years of retirement, especially. Those are your highest typical income earning years. Make sure you're saving some of that money. Number two, you got to review your monthly expenses for any extraneous payments that you have. Number three, I alluded to this earlier. Consider delaying Social Security. Some of you listening to this may not be able to do that. Some of you are wondering, should I do that or could I even do that? We'll get to that here in a moment. Number four is review your investments and withdrawal strategy. You have to understand when that income is going to be forced out, especially if you have those pre-tax accounts, those retirement accounts where you saved before tax. Most a lot of our listeners know it's now age 73 where you're required to pull that money out.

Dwight Mejan:
But then, you know, what's that investment strategy? Are you too aggressive right now with the portfolio or are you not taking enough risk relative to what your comfort level is? One of those things that you need to make sure someone's guiding you in that both of those the withdrawal strategy and how much you can expect to take, let's say you're five years from that RMD. You may not even know how much that's projected to be when you're that age. One of those things that we'd love to help you look at and analyze. And then finally, the last thing here is consider investing into annuities. And again, we've talked about annuities a fair amount on our radio show. There are certain annuities that we think are awesome for clients for guaranteed income, and there's other annuities that we don't particularly care for and we will when we meet with you, we'll be happy to show you the ones that we like. If it's a fit for your portfolio and we'll be happy to tell you certain ones that we don't like and we'll always give you the why behind it. So you understand you want to have an annuity though, so that you can have an income stream that you don't outlive. And know a lot of listeners when they hear the word annuity, they think it's a bad word. Many people do, but there are annuities out there that are for accumulation purposes. I know a lot of people that come into our office say, Well, I've heard annuities are bad.

Dwight Mejan:
And we say, Well, what do you know about them and what have you heard as to why they're bad? And a lot of people just can't put their finger on it. Are they bad? It depends on the situation. But they are they do serve a purpose. And if you do take income and you need to take income from an annuity, just know that the types of annuities that we help our clients with that client maintains control over the lump sum of money that goes into that annuity. There's a lot of misconceptions out there that if I put X number of dollars into this annuity, I lose that money forever and all I'm going to get is a is a pension or this income for the rest of my life. And that's one of the reasons people don't like annuities. But that's not the type of annuities that we typically explore with clients. So just know that about that. So the other thing I want to talk about here before we take a break is the smart adjustments. So smart adjustments basically is this you should have your portfolio and your retirement plan reviewed annually to make sure you're on track to meet your goals and not outlive your money. So if you haven't heard from your advisor lately or they're telling you to just hang in there despite some of the negative returns that you've been seeing, you owe it to yourself to sit down with us and see what your plan could be missing.

Dwight Mejan:
We provide consultations at no cost to our listeners. And again, you can go to our website. You hear us talk about that here on the show quite a bit. It's Retire360Show.com and there's a little tab down there you can just click on that. It opens up into our calendar and you can book that complimentary time and we'll let you know, Hey, this is something that's missing from your portfolio. You need to look at this. We'll be happy to take a deeper dive with you in areas that you want to focus on. But reviewing your assets regularly allows you to know when you should rebalance that portfolio. And over time, the performance of different assets can cause the portfolios allocation to drift away from what you originally intended and what you set up. So rebalancing is going to help you maintain your your desired level of diversification and risk and also rebalancing can help you keep your emotions out of the investment decisions. That's very, very critical. It requires periodic buying assets that have decreased on your asset allocation and selling assets that have increased in value. That's the whole purpose of why we rebalance. But we want to help take the emotion and the stress out of financial planning so that you can live a stress free retirement. We're going to take a quick break and we're going to come back and we'll dive right back in. And we're going to pick up on an inflation demonstration. So we'll be right back.

Producer:
You're listening to Retire 360.

Producer:
With soaring inflation continuing to wreak havoc on everyday budgets, there's never been a more important time to cut costs. But do you know where to begin? I'm Matt McClure with the Retirement.Radio Network. Powered by AmeriLife. There is no question costs have been soaring.

Sharon Epperson:
About one third, 34%, say they are worse off financially this year than a year ago. Almost half, 46%, say they've had to cut household spending due to inflation.

Producer:
Cnbc correspondent Sharon Epperson recently reported on a survey that sheds more light on how inflation has been impacting us all. Even those who earn six figures a year.

Sharon Epperson:
These high earners say the first expenses to go are dining out at restaurants, entertainment outside the home and travel and vacations. More than half also say they'll delay big household purchases.

Producer:
That high inflation has led the Federal Reserve to respond with interest rate hikes. The goal is to increase costs to tamp down demand. Esther George is president of the Kansas City Fed.

Esther George:
Already we've seen the committee's policy actions lead to a very sharp tightening of financial conditions.

Producer:
But it hasn't done enough yet and costs still keep rising. So what should you do? Well, we have a free resource called 23 retirement cost cutters for 2023. It's full of ideas to help you make the most of every penny. Things like take advantage of senior discounts, eliminate unnecessary subscriptions, and cut back on clothing expenses, look at your.

Sharon Epperson:
Needs and wants, Figure out what's optional and what you can cut out.

Producer:
The last one on the list of 23 retirement cost cutters for 2023 is perhaps the most important. Seek advice from a trusted financial professional. That's the best way to get in-depth financial advice in retirement planning that's customized to you and your goals. Just make sure whoever you consult for financial advice has years of experience and credibility you can verify. So do you know the best way to cut costs in 2023? That's a key question to consider as our budgets get stretched to the max with the Retirement.Radio Network powered by a mirror life. I'm Matt McClure.

Producer:
You're listening to Retire 360 with Dwight Midgen. Now back to the show.

Mitchell Keiser:
All right, guys, Welcome back. This is Mitchell Keiser. You are listening to the Retire 360 show.

Producer:
Want to know where your hard earned money is going. It's time for an inflation demonstration.

Mitchell Keiser:
So you guys had been listening the past couple of weeks. We've been talking about inflation specifically. Last week we got into the Super Bowl of any Super Bowl fans. We were talking about the cost of tickets and how the tickets have just skyrocketed. I know the average ticket to the last Super Bowl this past Sunday was about 5400 bucks. And I know we also had touched on the past couple of weeks the cost of eggs and how much eggs have gone up. And if you guys didn't know, you didn't have a chance to listen to this, I just thought this was interesting because I didn't know this, that there was a big bird flu outbreak in 2022. And that has a lot to do with the cost of why eggs have gone up so much. But in other news, as far as what else is going up, is anything associated with eggs is predicted to also increase this year. So anything that is egg based. So you've got mayonnaise baked goods, other household items. You've also got your egg noodles, certain types of breads, custards, puddings, certain vegetables, anything affiliated with an egg. It's probably going up in price. Thought that was all pretty interesting. And then they're encouraging or they're saying the amount of people that have been eating at home has also significantly increased. I know that Dwight and I, we talked about even going out to a restaurant. We've noticed that the portions have significantly decreased. So if any of you guys have gone out to restaurants, the prices may not have gone up and you might have raised your eyebrow like, how are they affording to do this with the cost of inflation? Well, they're doing it off the the portions of that they're giving you at the restaurant. So if you're getting a sandwich, you probably whether you realize it or not, you're probably not getting as much meat or if you're getting a steak, they probably cut the ounces down or the chicken or, you know, the portions of the veggies. They're not giving you. They're not cutting into their own profits. They're you're experiencing it somehow. Yeah.

Dwight Mejan:
You know, you're talking about eggs. I'm on this little diet I got going right now. So you made me think about the eggs as you were talking about them. I'm on the protein diet and less carbs right now and doing some probiotics and trying to get some good gut health. But this morning I was whipping up for eggs like I like to have in the morning and I had to throw an extra one in there because my dog's looking at me. He knows when the eggs come out of the fridge that he hears that fork whipping them up for some scrambled eggs. So he's looking at me like, Am I getting one of those? So I had to think, is he worth that extra buck? I'm going to crack. And he absolutely was. So you're listening to a Dutchman here who's my kids call me tight sometimes, but I say I'm frugal. It sounds a lot better, but hey, like we.

Mitchell Keiser:
Need to have them as a guest speaker one of these weeks.

Dwight Mejan:
Who's that? The kids. Your kids? Yeah. Put them on the panel. Got a couple of them. I'd love to get on the show, so. But, hey, we're. It is. It's tough. Is definitely going up and we see it everywhere in the grocery store. But this time I think it's year over year a chart that we had prepared for the show was it 35% this time last year? Just food at home overall has gone up. Yeah, it's crazy. Hey, if you on that note, you know, I kid a little bit about the dog, but I do tell people and this is serious, everything I have is for sale. I tell people that except my faith, my family, my friends and my dog love my dog wouldn't give him up. But, you know, some of our listeners, we understand it. Look, folks, it takes you know, you got to trust somebody with your finances. And many of you have some great advisors. That's awesome. We never want to get in the way of those relationships. We do want to be that sounding board there. So if you're wondering and maybe you're wondering, Hey, I don't really know these guys that well, I'm going to encourage you to go to the website. I talk about my faith, my family, my friends. But the non-negotiables for me are the beliefs. And if you want to know who Dwight is and I know Mitchell subscribes to those same beliefs, go to Retire360Show.com it'll link you over to 360 Capital Management. Our company. Those are beliefs tab right there. It's the most important thing, folks, that's on the website.

Dwight Mejan:
All relationships, especially in the financial world, the good ones, they're predicated on trust and we don't ask you for your trust, 100% of it that that's earned over time. You've heard me say this If you're a listener of the show, you can lose trust in one moment, in one bad decision. In many cases, it takes a lifetime or a long time to build that trust. So all we ask you for is 10% of that. And if you're looking to say, Hey, could I give somebody another 10% to come in and talk about my portfolio, I say to you, Yes. And I say that confidently, I want to make this show about us. It's about you. But if you've been listening for a while and you're wondering, Hey, should I take that step and should I call these guys, I'm going to say to you, Yes, you can and give us an opportunity to earn the rest of that trust over time. If you're a fit, you may not be a fit. And we'll tell you that that's one of the things if you go to those beliefs, again, I can't emphasize them enough. Go. There and read about those beliefs and those core values. That's what all good relationships are built on. And I will tell you folks, and I can look you right in the eye if you're looking on YouTube right now, is that Dwight is going to die long before those core values that I have. Will okay. I live those. I was taught that way. And that's the way that we conduct our business.

Producer:
So need a higher rate of return from your safe money. Listen up. It's time to beat the bank CD rates.

Dwight Mejan:
But yeah, we're going to talk here just a moment about beating bank CDs with multi year guarantee annuities. They'll say that word again. Multi year guaranteed annuities are called in our industry. The acronym is Omegas EMEGHA. Interest rates. No secret they're rising. They've stabled off a little bit, but certainly from this time last year, rates are a lot higher. And those present opportunities, particularly if you're listening to this show and you're a conservative investor as interest rates rise, bank CDs rise, and we encourage you to consider an alternative. If you're interested in protecting and growing your safe money, the money that you don't want to put in the market. We like indexed annuities, but these omegas might be a better fit for some of our listeners. Amiga is a multi year guaranteed annuity, as I mentioned. I said, Hey, CDs, they're good right now, but many migrates are actually more favorable currently. We can tell you this, you know, a lot of CDs obviously range from anywhere from six months to maybe five years. Those similar Omega annuities, one year rates up to the five year terms typically are higher than a lot of bank CDs. They're more favorable in most cases. Okay. So if you want to learn a little bit more about those, click on that tab, Go to our website, Retire360Show.com or call us here at the office, schedule that complimentary meeting and say, Hey, I just want to come in and learn a little bit about these products you're talking about.

Dwight Mejan:
But just remember this about Omegas. They allow for tax deferred growth. So if you have money just sitting in cash off the sidelines, sitting in your savings account, sitting in your bank account, the earnings and the gains from investing in those omega products are not subject to taxes until those funds are withdrawn, until you take them back out of that account. So you're going to get interest compounding on money you otherwise would have paid taxes on. So more potential for greater growth and you receive guaranteed returns on these omegas. They're just like CDs. It's the it's the same interest rate over whatever the term is that you purchase. And there's all different types of terms. You can get one year terms, two year terms, three, four and five year terms. I wouldn't go much longer than that because we don't know exactly where interest rates are going. I don't like locking into ten year terms on those products because rates could be higher in three years and you're going to miss out on some of that higher potential gain.

Dwight Mejan:
But certainly up to five years might be a good place depending on the listener and depending on when they need that money. That's one of those areas that we will help you out and we'll ask you some specific questions to kind of help guide you on that. So this can provide peace of mind to investors who are seeking more predictable returns on their investments. And just understand this, that most bank CDs have a financial reserve requirement of 3 to 10% while migas have 100% reserve requirement just basically means that, you know, you walk into the bank, a lot of people feel comfortable with. They see FDIC, Federal Deposit Insurance Corporation. Well, in here in North Carolina, there's they're backed as well. And we won't spend time talking about that here. But question for you, would you feel safer knowing that 100% of your principal is backed up in reserves by law versus just 3 to 10% with a bank CD? So I'll leave you on that question. So what's a good, safe investment if your money isn't as safe as it can be? That's the question I leave you with. So we're going to be right back. We're going to take another break and stay tuned and we'll pick it right back up here shortly.

Producer:
At 360 Capital Management. We know you've worked hard to earn your money and you've worked even harder to save it. When it comes to wealth management and planning for retirement, Dwight Mason is passionate about helping people protect and grow their wealth. Visit Retire360Show.com to schedule your free consultation today it's a $1,500 value provided at no cost to you. Book yours now at Retire360Show.com. Helping bring you one step closer to financial freedom. You're listening. To Retire 360, here's Dwight.

Dwight Mejan:
Well, we want to welcome you back here to your radio program. We are the retired 360 show and you can find more about us at the Retire360Show.com or I shouldn't say the retire it's Retire360Show.com, but thanks for taking time out of your day to listen and we're going to jump back in here to what we call smart legacy. We're in the Smart Retirement Plan series right now and we're talking about smart lifestyle, smart legacy, which is our topic now and then Smart Adjustments. We talked about that a little bit earlier, but smart legacy that's basically just planning for end of life, not always things that you like to think about, but death and taxes, they're going to happen, right, guys? That's one of the things that's coming for all of us. Your family doesn't want to think about life without you and may choose not to make a plan to avoid some hard conversations. But the reality is making a plan for your end of life, your life actually protects your family. And it actually you can call it courageous. You can call it necessary. I don't care what you call it, it's just something you need to do. So if you're postpone doing some legacy planning, you need to be looking at that. But Mitchell and I had a little meeting this morning. We were talking about this and we were talking about the benefits of estate and legacy planning, knowing that this was one of our topics. And we were just talking about, you know, ensuring what is it? First of all, it's ensuring that your assets are passed on to your loved ones in a tax efficient manner. If we can't really say it much simpler than that, just ensuring assets are passed to loved ones in a tax efficient manner.

Dwight Mejan:
And what is it? It's a blueprint. We're going to talk about wills and trusts here in a minute, but it's a blueprint that you put in place to make sure that those wishes are carried out when you're gone, when you get your wings and fly out of here. That's what that blueprint is going to do. But by setting up trusts and wills, retirees can avoid the hefty taxes associated with distributing assets after death. One of the things that we look at quite a bit is, you know, we don't draft trusts. We're not attorneys, we don't do wills, but we work with your attorney or we can recommend attorneys to you if you don't have one that can help set up some of these basic instruments that are very necessary for all of our listeners. If you're listening to this show, chances are you've got some assets you need to be thinking about that estate plan, particularly if you already are retired and you haven't thought about it. It ensures that the assets are distributed according to your wishes. This eliminates the possibility of family disputes over who should receive what asset, and then it also provides for your loved ones in the event of your death. So this can provide peace of mind knowing that their family will be taken care of after they're gone. And one of the things that we do quite a bit is we look at beneficiary relationships on all of the accounts, and that includes not just life insurance people here beneficiary. Oftentimes what comes to mind is life insurance.

Dwight Mejan:
I'm gonna have Mitchell talk about that here in a minute but very important that beneficiary designations are correct on policies don't want to make the story today a horror show. But I will tell you as an advisor, I could do a whole show probably three in a row, telling you some stories about people who thought they had beneficiary designations. Correct. And they weren't correct. One thing I can tell you just to make sure of, we had a client got referred to our office who ended up passing away and this individual had left in his will. He had left an asset to his second spouse who had come into our office. Long story short, folks, she did not end up with that asset, even though she was listed in the will as the beneficiary of that asset. But there was some precedence in a prior law that took place with a retirement account that this individual had and that retirement account had left the name on of his first wife. Guess who got the money? Not his current wife that he had before he passed away. It was his prior wife. So very, very important that you just don't default and say, I've got a will that's taken care of and that's going to cover anything. I didn't do beneficiary designations. We will have sometimes meetings around just that with our clients to make sure that everything is buttoned down in that area. But life insurance is just one aspect of it. But I thought. Mitchell, especially if you're younger and still working, had a great point to this. Mitchell Tell our listeners what you were talking about on the estate side of smart legacy planning.

Mitchell Keiser:
Sure. Well, I'll just say, you know, you were talking about as far as a legacy, when somebody passes away, who else was reliant on your income? I'm just going to read to you the number two definition from Webster, and that is the definition of legacy. And it is the long lasting impact of particular events, actions, et cetera that took place in the past or of a person's life. So your legacy is essentially who's relying on you? One. Two, it's how are people going to remember your life after you're gone? So I think when most people hear the term legacy, they think, Oh, well, your legacy begins after you're retired and you've accumulated your whole nest egg retirement fund. And that's not true. Your legacy starts as soon as you become an adult and you get out of your parents house and, you know, you stand on your own two feet, that's when your legacy begins. So I'm, you know, still early in my career, still in my mid 20 seconds. But does that mean that I've accumulated, you know, my huge nest egg right now, my whole retirement savings? Of course not. But I'm heavy right now on the term insurance side because I just got married. We're going to start a family. We're going to build a house. You know, all those things that's going to accumulate a large amount of debt. Those kids are going to go to school. There's going to be money that's going to be needed for that. And that's that's going to take a lot of money to do that.

Mitchell Keiser:
So you need to have a legacy plan in place for that, which I do. And I think most young people should. I have another friend I just met for breakfast and he's getting married in April or I'm sorry, he's getting married in May. And he was just talking about how he's in his 30s and he said that he needs to get life insurance now because he's going to be starting a family and they're buying a house. And that's all a part of his legacy. So what's the difference between my legacy and the legacy of a person that's retired? I mean, they're both legacies. But here's something that you have to keep in mind all throughout your life. It's not that the legacy changes, it's that the situations and the factors that go into that legacy are going to change. So, you know, as. In my 20s now. So when I'm in my 40s, I'm probably going to need to alter my insurance, my IRAs. You know how I have my real estate positioned now? Once I retire, that's going to change again. And then when you're retired, as you retire into your retirement ages, I mean, you need to continue to tweak it and modify it. And, you know, insurance is going to go out and you're going to run into more money. So it's just something that needs to constantly be looked at. It's not a one and done deal. It's something that you start when you're young and you just continue to modify it throughout the rest of your life.

Dwight Mejan:
Yeah, well, Mitchell, you would never boast on yourself, so I'm going to do it for you. And this comes from your father in law. Mitchell had a good head on his shoulders before he got into the financial services and insurance industry, I will tell you that. But, you know, one of the best things I think to to go somewhere in life, if you want to get somewhere, is to be coachable. I think it's just an important trait and somebody listening to the show right now, I'm just telling you the advice that Mitchell's talking about with your insurance situation. If you're underfunded, you don't think you have enough of insurance there. Look, you owe this to your family and to your kids, particularly if they're still younger. Life insurance is a cheap expense right now. It's very affordable. So if you're low on that, take it from from Dwight here. Just a gentle reprimand, if you want to call it that. I'm teasing a little bit, but in one way, I'm not. Make sure, guys, especially if you're listening to this, honor your family. Make sure you have the right amount of coverage. Okay? I always say if you're not going to get help, like the old charter commercial says, get help somewhere.

Dwight Mejan:
I say that. Get help somewhere. We'd love to be a place where you could go. We shop that we're independent fiduciaries. Mitchell can help you out with that. But just a good segment from from Mitchell there. And I appreciate his input on that. And I want to bring another young guy on here. Sam, our executive producer, could speak to the legacy side. I'm going to have Sam share something that we talked about pre show here today, just about the importance if you're a listener and you're maybe, you know, you don't you're not going to use all this money. You're going to leave some money to your grandkids or to your own children or maybe both of them. And you've got money that's built up in this pre-tax account. You may want to be considering a Roth account and paying the taxes on it so you don't put this ticking tax bomb in the hands of your grandkids who may be off already. Maybe they're married and they've got dual incomes. We call them dinks, dual income, no kids. And if your grandkids are dinks and they're going to inherit some money, make sure that money's after tax. Sam, share your story with the listeners.

Producer:
Yeah, absolutely. I think that's a great tip, Dwight. I mean, if you do, you know, 1 or 2 things to start working on your legacy plan today, a big one would be consider doing that Roth conversion or establishing that Roth IRA. I've been married for the last two years. I met my wife nine years ago, shortly before we met her father unfortunately passed away in an untimely manner, and she went on to inherit his IRA because he was still in his working years. Well, now that we're married and and here in February, we're amongst tax season. Everyone else is, you know, I'm sure getting their tax forms stacked up on their desk. And you know, we're required to take those required minimum distributions from what was her father's IRA. Even though we're now just working in our 20 seconds, we're dinks, like you said, dual income, no kids. So, you know, that goes into our combined taxable income every year. And and, you know, just consider, you know, making that little change and not passing on a bit of a tax bomb to your beneficiaries.

Dwight Mejan:
Yeah, great. Just appreciate these guys so much. I love the fact they've got good heads on their shoulders, but the wisdom they just shared both of them with you, our listeners, very valuable. And again, if you're in that situation and you're a listener of this show, perhaps you're tuning in for the first time. We just appreciate you taking time out of your day to be here. But maybe the timing of you being here, I believe everything happens for a reason in our lives. And maybe the reason you're coming into this either new or you've been listening for a while, that one piece right here or this segment may be the piece of why you're listening is, you know what? We're the type. We don't need all this income. We're going to probably get our wings and fly out of here when the time's up. We're going to have all this pre-tax money and no one is talking to us. Our current advisor certainly isn't addressing the tax issue. And what could we do to minimize those taxes? That's your legacy. That's why we entitled this Smart Legacy segment. We want you to leave a smart legacy. Why give that money and partner with the IRS? And you may say, hey, I'm not partnering In a way, you are partnering by default. You're putting that money in the hands of the people you love, which is awesome, but you're also doing it at a cost to them that's higher than what it could be and in many respects than what it should be.

Dwight Mejan:
So it's one thing if you need income and you're living off of it from your portfolio. But I know a lot of our listeners, they don't live off of any of the income. They're taking it because they have to. But remember this, I say this at our live events. I say it here on the radio. If you own a pre-tax account money that you funded before it was taxed, it's sitting there and you're going to have to start pulling RMDs out. You got to look at it this way with the average listener on this show, 20% to 25% of that money in your pre-tax account, it's not yours or mine anyway. It belongs to the IRS. It's just on loan from them. You're just able to open your brokerage statement or your investment account and see a little higher balance in there. But some listeners are as high as 45% and maybe more depending on their estate and some other things that are going on there. But just imagine, you know, 25% or a third of that money, it's not yours. So why wouldn't we want to look at a tax efficient way to spread that liability out, mitigate or minimize some of that tax in your lifetime and then set up the next generation with an even better gift than what they're going to give.

Dwight Mejan:
And we'll show you how to do that. Go to our website, Retire 360. Show.com click on that complimentary consultation link and come on down here for 30 minutes. We'll do a zoom meeting with you if you'd like to do that, you come down here to the office, you will not feel any pressure. That is not our style. We are fiduciaries, we're independent, holistic fiduciaries. So we will ask the right questions for you. That's our job. You know, my dad always said, Dwight, the secret in life isn't knowing all the answers to life's questions. It's knowing what questions to ask. And that's the line of work that we're in. We ask the questions and we'll point you in the right direction. We want to talk just briefly here about wills and trusts. What's the difference? Okay. A will and a trust are both legal documents that are used to manage a person's assets after their death, but they serve different purposes and they have a few key differences. A Will is a legal document that outlines how you want your assets to be divided up upon at your death. And it also outlines who should be the executor of that estate and who should receive any assets.

Dwight Mejan:
But a will can be contested. You know, a will is basically a Latin term for to prove. And what a will does, A will, as we like to say, is your ticket into probate, because in that court of law, that will is going to be proven. So if I have a claim against somebody that I realize has passed away, I may not even have a valid claim, but I can contest their will and that automatically brings it into court. I have to prove that I have a claim against it. Maybe I'm a contractor. They owe me money that wasn't paid. I can go after that through the court proceeding. But probate folks, it costs money. I've heard of probate costs and here in North Carolina can range anywhere from 4% of the value of the estate annually, up to 7% of a person's estate. So just imagine for every $100,000 that you have, let's just take an average. I'm just saying, let's just suppose it's 5 or 6%. That's 5 to $6000 that could be tied up through that process. And, you know, I heard a saying it was kind of funny. You know, I love attorneys. I have one. But, you know, attorneys get paid to work on something, not get something done. I don't say that to offend anybody. We need attorneys. They definitely serve a purpose in the financial plan.

Dwight Mejan:
We need them to do that. But we have to be careful even with the whole process. And that's what probate can do, is it could just drag the process out and that that costs money. So a trust on the other hand, that's an arrangement that allows a person to transfer their assets to a trustee during their lifetime. If the trust is written properly. And we're not lawyers, we direct people to lawyers, but we'll certainly help ask questions and guide you down that path with your portfolio. You know, a trustee is basically responsible for managing the assets and distributing them to the beneficiaries named in the trust. But if that trust is set up properly, it can be done in a way where you don't have to worry about the probate process because the trust is written. It's a little bit more technical in nature. It's it's not for everybody who's listening to the show, but that's one of those things that you just have to have good counsel on and determine what's going to be the best a will or a trust. So our two big tips I'm going to see Mitchell can come on. And he's got a few things to say here about one of the tips as far as a will goes between a will and another tip here, we want to give you, those of you.

Mitchell Keiser:
That have or do not have a will. So don't leave your legacy in the hands of the courts and the state. Make it make your last will clear so your family doesn't have to bear any additional burden after you pass away. Now, I think most of our listeners live in North Carolina. We work with a couple of lawyers that have helped us with our clients and their wills. I know in North Carolina. Most courts will recognize if you state your name and your estate and you designate where you want your assets to go, and then you sign it at the bottom, sign it and date it. Most courts in North Carolina will recognize that. Now, if you're established and you don't plan on changing your situation or having kids, any more kids or anything like that, or if you have like a tertiary will, I would take that and get an official will done with a lawyer. But if you don't have anything at all, I know that most most everywhere in North Carolina will at least recognize that. I think that's. I didn't know that prior to working with some of the people that we have. So I think that's a that's a good tip.

Dwight Mejan:
Yeah, That's awesome. Good, Great tip. Neil Mitchell. So number two is have a Roth IRA account. We talk about that a lot on this show, but your funds within a Roth account will pass to your beneficiaries tax free. You heard the story from Sam here earlier. Talk about that and would have been a better situation certainly for him and his wife if he had had that. But any growth within the Roth is tax free as well, and it's not subject for you. The living benefit is it's not subject to you in your lifetime to have RMDs pulled from it. So don't let your family inherit that IRA tax bomb. So the Roth converter, we want to talk about Roth conversions, Benefits of an IRA Roth for End of Life Planning. A Roth IRA is a type of individual retirement account that allows you to contribute after tax dollars to an account that grows tax free. So we want to always be clear on this show there's no way to avoid income taxes. Okay? If you try to do that, you're going to end up listening to this show behind bars and we don't want you to do that. We want you to do it the right way. But there are ways to spread and mitigate the taxes that one pays over their lifetime or over their retirement. Those are the strategies that we can help you with. The main benefits if you're doing end of life planning with a Roth IRA or trying to convert into that, include tax free withdrawals, There's no age limit for contributions.

Dwight Mejan:
That's key. Anyone can do this. You're never too old. You're never too young. You can do some contributions in a given year and stop for a period of time. That's the beautiful thing. They used to have limits on this sort of thing, and that's all been kind of thrown to the wayside. And you can strategically, we can do things to help you mitigate the tax liability that you have because there's other types of income that are at play here. There's Social Security. We want to be careful about your Medicare premiums, the Medicare tax that you could pay more on, and we can help with that. We can show you what would what would happen on your tax return. If you do certain things, we can send it to your CPA. If you work with an accountant and get them to bless that as well. But we understand some of the strategies that we'd love to help you with in terms of doing those conversions. If you're interested in doing end of life planning, there's no required minimum distributions that have to start on that, as I said earlier, and there is potential for compounded growth. The money in the Roth IRA grows tax free, which means that account has the potential to grow faster than a traditional IRA or another taxable account.

Dwight Mejan:
There's also flexibility. That's another benefit. You can withdraw your contributions to a Roth at any time without penalty, although you'll owe taxes and penalties on earnings if you withdraw them before 59.5. So Roth conversion. If you're eligible, you can convert the traditional IRA into a Roth IRA, which can be beneficial, especially if you expect your tax rate to be higher in retirement. So if there's anything that we've talked about in today's show and you want to take a little deeper dive with us, I'm going to encourage you to if you're sitting at home. Of course not if you're driving, but go to your computer. Just remember, Retire360Show.com. Go there. You can book a complimentary no cost confirmation consultation to you as a listener. We will sit down with you. We'll help you analyze your financial situation. Perhaps there was something specific today on today's show that you want to talk about more and do a little deeper dive. You have questions? Hey, you have questions. We have questions. We know what questions to ask to help guide you. And we're going to come to some conclusions together. One of those conclusions might be, you know what, we need to gather more information for you so that we can map something out for you. It may just be that we're going to help refine what you already are doing. And if that's the case, we'll part from that complimentary session as friends and you'll have gotten a no cost second opinion on your situation.

Dwight Mejan:
But we will discover exactly how much you're paying in fees. If you're working with a current advisor, we want to help you cut unnecessary costs out of your IRA, out of your 401. K. We had a listener come in this past week who we did a portfolio analysis on and found out that their fees are almost 1% more. I'm not talking about their advisory fees, almost 1% more on the expense ratio, which is internal fees within the investments they have than what they should be paying. It's a pretty large portfolio and paying almost 1% more than they should be with a portfolio that is comparable to what they have that could significantly reduce that. So fees very important to be watching not just advisor fee, but the expense ratio fees. We'll look at that within your retirement accounts as well. We'll look at your Social Security. If you're not drawing that, maybe you're wondering, hey, what's the best timing of when to do that? We'll take a look at that. As well as Medicare. Medicare insurance period is a huge area where our listeners can save money every week, every month. So if you don't have somebody in your corner who's a fiduciary independent looking at insurance, we've got that all in house. Had another client that came from the radio show and said, Hey, one of the things they appreciated about us was the fact that we have that all in house.

Dwight Mejan:
It's one stop for everything that she needs in retirement, and it's all done through a platform where we're independent, holistic fiduciaries. So we'll compare your current situation with what's possible if you were to work with us. We'll lay it out for you and we'll send you home. We don't make you make a decision on that right here. We let you take that information, go home with it, digest it, and let us know if we can help you. We'd love to see our listeners if you want to come in and be a part of our next live event that's going to be in Randolph Community College at that location February 28th. On Tuesday, it's going to be at 11 a.m. We do have some limited seating available for that. So reach out and call us here in Southern Pines. (910) 235-0812. If you want to come with a friend or a guest, maybe they listen to this show with you or you would like to invite them. Let us know that we'll get you directions and we'll have a space reserved for you. But thanks for listening to this week's show. We really appreciate it. And we look forward to picking it up next week where we left off. So thank you for listening and have a great week.

Producer:
Thanks for listening. To Retire 360. You deserve to work with an experienced and licensed expert who will strategically work to protect and grow your hard-earned assets. To schedule your free no obligation consultation with Dwight, visit Retire360Show.com or pick up the phone and call (910) 235-0812. That's (910) 235-0812.

Producer:
Investment Advisory Services offered through Brookstone Capital Management, LLC, BCM A Registered investment Advisor. Bcm and 360 Capital Management are independent of each other. Insurance products and services are not offered through BCM, but are offered and sold through individually licensed and appointed agents. Investments involve risk and unless otherwise stated, are not guaranteed. Past performance cannot be used as an indicator to determine future results.

Producer:
Fixed annuities, including multiyear 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.

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