Wealth from Wisdom

Protecting Yourself in Retirement

December 07, 2019
Wealth from Wisdom
Protecting Yourself in Retirement
Chapters
Wealth from Wisdom
Protecting Yourself in Retirement
Dec 07, 2019
Carson Wealth

“Retirement: It's nice to get out of the rat race, but you have to learn to get along with less cheese,” said comedian Gene Perrett. Your life slows down, you don’t have the demands of work and you can turn that alarm clock off for good, but now your concerns are different: where will that income come from? Will it last? What will my lifestyle be like?

Like any other point in your financial journey, in fact even more so, retirement takes planning and strategy. You can’t depend on the “givens” – social security, Medicare, retirement distributions – to fully fund your retirement without some intentionality and planning. 
On this episode of Wealth From Wisdom, we’re going to discuss not only how to plan for retirement, but how to plan for the retirement lifestyle you want – not just survival, but thriving in those years. 



Show Notes Transcript

“Retirement: It's nice to get out of the rat race, but you have to learn to get along with less cheese,” said comedian Gene Perrett. Your life slows down, you don’t have the demands of work and you can turn that alarm clock off for good, but now your concerns are different: where will that income come from? Will it last? What will my lifestyle be like?

Like any other point in your financial journey, in fact even more so, retirement takes planning and strategy. You can’t depend on the “givens” – social security, Medicare, retirement distributions – to fully fund your retirement without some intentionality and planning. 
On this episode of Wealth From Wisdom, we’re going to discuss not only how to plan for retirement, but how to plan for the retirement lifestyle you want – not just survival, but thriving in those years. 



spk_1:
00:00
Okay. And here's the legal mumbo jumbo. The opinions voiced in wealth from wisdom with Ron Carson of her general information only and are not intended to provide specific advisor recommendations for any individual to determine what is appropriate for you. Consulted qualified professional all indices there unmanaged and may not be invested into directly. Investing involves risk, including possible loss of principal. No strategy assures success or protects from Los past performance is no guarantee of future results. Advisory service is offered through CWM LLC, an SEC registered investment advisor. The stock market hit another all time records. As much as $10 billion in Social Security benefits go unclaimed every single year. Federal Reserve announced that they will raise interest rates by 250. Skyrocketing cost of health care and retirement could now run 350,000 War tarred and savor retirements. That's great, but it's what you do with that money that really matters. Welcome to wealth from wisdom With Carson Well, Carson Wealth is a Baron's Hall of Fame advisor at recognized by Forbes magazine as one of America's top wealth advisors, and they're right here in Omaha. This is where you can count on straightforward and objective advice that could help you make the most out of every dollar you save for retirement. Welcome to well from wisdom with Carson Wealth
spk_0:
01:10
a retirement. It's just nice to get out of that rat race, but you have to learn to get along with less G's, said the comedian Jean Parrot. You know what? Your life slows down and you don't have the demands of work, and you can really turn that alarm clock off for good. But now your concerns are different. Where's your income gonna actually appear from? Will it last and what is my lifestyle gonna be like? This is gonna be fun. Is it gonna be scary on like any other point your financial journey? In fact, even more so, retirement takes planning and strategy. You can't depend on the givens. So security, um, Medicare, retirement distributions, winning the lottery or all of those types of things to really fully fund your retirement. And too, with some really protocol intentionality and planning and Paul West, this is well for wisdom. But co host today is Aaron. Would Aaron, welcome to the show.
spk_1:
02:04
Thanks. It's always great to be here. We should
spk_0:
02:06
actually count. Like how many shows you've been on? It'll be fun to deal with some point.
spk_1:
02:09
What's your guess? 27. Okay. I have no idea.
spk_0:
02:13
You're gonna take the overs of the unders.
spk_1:
02:15
I'm gonna take the under.
spk_0:
02:16
All right? You would conservative So anyways, by the way, we talk about Aaron's accountability layer on the show. Um, but today we're gonna talk about planning for retirement. So of course, this is where the most frequently asked topic. So if you're asking yourself right now, if you could think of one word and one word only to define a financial advisor. What would your word be if I asked you that question?
spk_1:
02:37
Well, mine and 11 word. One word. Uh, comfort,
spk_0:
02:42
Comfort. All right. Interesting. Now for our listeners today, what's your one word? And I would be interesting to hear what most people would say. I think that they would be ableto board investments, sales e ah, stocks. Um, and how many of you actually said the word planner and I
spk_1:
03:01
would've been
spk_0:
03:02
not a lot of you do, or some of you may be said retirement or helpful or hopefully necessary or those other things, But the reality is, is financial planners or financial advisors and actually like the term financial planner Better because planning includes providing advice. Advice doesn't always mean planning, right?
spk_1:
03:21
You know, my husband asked me that today. What is the difference between a financial advisor of financial planner and the C F P, which told me I'm doing a really bad job of explaining things to him. But I actually said those words and themselves. Anyone can use them. But what anyone can't uses the designation so anyone can call themselves a financial planner. But only CF peace, who have went through the education and have passed the test can use the C API designation.
spk_0:
03:43
Yeah, and I mean this C F p destination. We're both a cf B. So congrats to you, gratitude for passing the rigorous exam, but also, you know, staying caught up with their standards and their ethics. And there's something we're watching out on. And before we get in today's show on today's show, we're gonna talk about people's biggest concern, and retirement is easy and you're not gonna guess it. But it's so true what you think about it, and I'll give you the answer right now. Run out of money. Absolutely. Number one fear it's not How long you gonna live? No one wants to be 85 years old, full of life and broke. We just wait. We don't want it to happen. So we need advice given to us that's gonna help us. And so, with the CFB board that we have a code of ethics and standards for professionals like yourself, Aaron and myself. Um and you know, we're all waiting for real disclosure that we all have to D'oh, that is a super interesting. So many of you know, we talked about the word fiduciary very frequently on the show. And But if I'm providing advice to you about your retirement and helping provide a plan and I don't know why, I wouldn't work with the without a c f. B. So I I don't know why you would pick a financial special who's not at least past this minimum. Would you go to a doctor who hasn't passed their boards, have been the residency somewhere and
spk_1:
04:56
got experience? And you do see someone who's in residency. But they're still have someone who is over them toe help on the areas that are outside the areas of expertise. Yeah,
spk_0:
05:04
um, and same way I look at it, providing advice Just because you got license to sell it doesn't mean you should. I mean, do you trust a 16 year old driver when they first get no slices? No. Why are the insurance rates so high? Because you have to have experience. You have to encounter things in life. And that's why those of us who are good financial planners and professionals, there's some form of experience. But also we have codes and standards that go along with this I thought was really interesting. So we're fiduciary, meaning we have to provide legal advice that is in the best interest of our clients. And it can't put our interests in front of clients sound so simple. In theory, I'm right. The reality is there's less than the majority of us actually behave that way, And it's a pretty small minority of us actually that act that way as registered investment advisors and fiduciaries. Well, something interesting and this came out directly from Northwestern Mutual, one of the largest you know, if certainly insurance companies and a lot of people across the country use them. But it was interesting. They came out with codes of conduct of what their C, f. P s could and could not do at their organization. Aaron and I'm looking at it here, right in front of me. I mean, it's pretty fascinating. First of all, it's eight pages long. It's a load.
spk_1:
06:15
And unfortunately, we're seeing lots of organizations going that way, especially on the insurance side.
spk_0:
06:19
Yeah, in some of things, I'm just gonna paraphrase or summarize here for you. But inside of this, if you're gonna follow the board of conduct standards and those important things disclosures, things that would have toe happen is you would have to sit there in front of your client and tell them the following that I have a financial incentive to sell you a Northwestern product over other things. I think about what I just said. I am incentivized to Sicily in one certain thing over another thing, even though, by the way, the other thing could be better for you.
spk_1:
06:50
And that is so needed for these things to come out honestly. I mean, they were happening. People didn't realize what they were buying. They didn't realize there were other options. And so these rules getting bigger is is very unfortunate that we're in this position. But at the same time, I'm glad that they have to disclose them because any client should be able to go in and say, You know what? My advisor, my planner, did what was in the best interest of me, not what was in the best interest of their paycheck. And all of us know we also have a right and a need to make money and do things. And nobody is saying that that can't be what this is. You just have to tell your claims how you're getting paid and not hide it.
spk_0:
07:26
Yeah, not hide it, which I think is great. And I think we don't have any things. But there's there's these things that happen. Also, they call minimums, and this is directly from this document. I think this is so fascinating. So they should disclose to you the following. I am required to meet minimum annual insurance production requirements established by my company. So I mean, I mentor sitting across the table and the person they're if they're going to eat that week and putting food on the table for their family and pay their rent or their mortgage payment makes means they have to sell a minimum amount of a specific type of insurance to people like you. I just I mean, I can't fathom sitting across from the table from a professional, and I put a professional hit air quote. Is there Erin is You have to be smart as a consumer. That's what we're trying to teach you here on welfare and don't we wrong? There are plenty of good professionals at Northwestern Mutual not picking on them individual here. I just Our job is to explain to consumers that you have to be smart about this and you have to learn and be educated. And now there's conflicts of interest between a C F P. Who's at a new organization like that, versus what the business is standards are, and how you actually to to explain it. By the way, how many people are gonna read an eight page
spk_1:
08:36
disclosure? They're not know.
spk_0:
08:37
So if that's buried inside of there, are they ever gonna see it? No. But do they complete their legal obligation by handing it to you?
spk_1:
08:44
You and you probably sign the last page and give it back, Tom.
spk_0:
08:46
Yes. Yeah. Well, how many of you think about your phone when you get the apple updates to your iPhone, Right. Except, actually, you know, it's probably that quickly is Yeah, you just answered there. So we want you to think about this and you think about longevity. Oftentimes these insurance firms, it don't have a fiduciary standard. So where they tend to do that in to sell you life insurance. But I wanted things I want to talk to you about. Is life expectancy of so different now? So you have to be careful. Is are you getting a product? Also, that works. I will give you this. So when FDR signed the sole security act in 1935 average life expectancy you ready for this? All right. 61 years old.
spk_1:
09:24
Isn't that crazy? 60 would. Now we're not even retiring
spk_0:
09:28
sixties. The new 50 right? Our sixties, the new 40. Call it, um, but now I mean life expressions in the eighties, so it's very different. Um, of course, there's been just the amazing improvements in terms of public health, medical availability and life expectancy is gonna take a lot longer or is gonna continue to grow. So there's gonna be this amazing wealth transfer that happens from the baby boomer generation. By the way, I joke the other day, my kids think I'm doing something that's old. So I'm in my mid forties here that they call me Boomer. So they think that's funny.
spk_1:
10:05
I think I'm just gonna start calling you little Boomer.
spk_0:
10:07
Yeah, you can. That's fine. We're getting closer. But baby boomers there, the generation between 1946 and 1964 they're retiring at a rate of 10,000 people a day. So those with many of the people that you and your team are providing financial planning for here, Aaron at Carson Group, I mean, 10,000 people a day. And again, what's their number one fear
spk_1:
10:26
running out of money?
spk_0:
10:27
Yeah, so they're number one Fears running out of money. You better have a plan in place to ensure your success. What I want to share with you is if you think your retirement is gonna be linear and just this slow lying, showing you a gradual degrees and you're not gonna run money, life just doesn't happen that way.
spk_1:
10:45
That's not even close to what happens.
spk_0:
10:46
Know what does happen for people?
spk_1:
10:48
Well, there's a couple different things when you need to expect there's going to be recessions. And so the average person is going to see, you know, approximately six of them. That is something that your your investments are definitely going to go up and down. There's also inflation in there, and then you have to take into account the life that you're living. So we like to say, you know, the go go, this logo on the no go expenses and each one of those is very different. And I know in a couple segments from now we're gonna talk about some of those no go years. And what do they actually look like that people should be planning for?
spk_0:
11:17
Yeah, I mean, and I think Go, go slow, Go and no go. We'll keep those phrases going here for us, Aaron. But is we think about life expectancy. I mean wax. Ask everyone is start from the end and work backwards. And no, we all don't have a crystal ball. It's funny that when you ask people's opinions on how long do they think they're gonna live? Oh, I love to hear their answers. So people answer ages of, say, 100. Some people start telling you about their family medical history. Um and then others just start to worry. And what the end of the day is is a good financial planners Job is to have you not worry because you've built a plan where, no matter what age you live too, you're gonna make it work. And so one of the things we'll talk about in the show is long term care how important it is for you. And it could be a great building block or tool for you if you want. Actually, we have a guy that helps explain this to people is called Managing Long term care and retirement. If you want, you can text us at 33 444 Just type of the numbers. 33 444 in your phone. Put in the word management and we'll send that right back to you. That's free guide. That helps explain this and what it looks like because big decisions like this and we're gonna walk through the details all add up. I mean, you've heard of this. You know the house of cards, right? You keep putting things together. But if you don't have it built correctly on the bottom, what happened?
spk_1:
12:35
I'll fall down.
spk_0:
12:36
Yep. And we can't have that happen to all of you and your retirement. It's too important. You work too hard. Many blood, sweat, tears, nights and weekends and everything you've done. You've got to protect yourself. That's important. Hey, we'll be back in a moment. Well, from wisdom,
spk_1:
12:49
do you own an annuity? Inflated fees and commissions could be costing you an arm and a leg. Get straightforward and objective advice from Carson wealth by calling 888419 85 13 Are you caring for an aging parent? Are you concerned about the skyrocketing cost of health care in long term care? Or you have questions about how to best manage an inheritance? We can help call Carson Wealth. Today at 888419 85 13 And now back to well, from wisdom with Carson wealth.
spk_0:
13:18
Hey, welcome back to well, from his amount, Paul West Coast today is Aaron. Would I believe her 27th 28th appearance but will validate that from our statistician. Hey, we're talking about protecting yourself in retirement. In the first segment, we talked about longevity, preparing for it. Everyone's biggest fear is related to running out of money, but
spk_1:
13:38
also a
spk_0:
13:38
new fear is arising for people. Aaron, what I mean is we all contribute or most of us contribute to Seoul security, right and work getting asked more and more frequently. Will Social Security be around? Yeah, and will be available for me, right? I mean, aren't you? Your group's getting at
spk_1:
13:53
all. It's a very common question, and it's one of those. Unfortunately, no matter how much you tell someone, here's all these options of how they can fix it. It's still in the media, and we both know that the more common a conversation is for fearmongering or blood in the streets or whatever analogy we want to use, that is what people here and so it is a constant fear, you know. Yes, there will be changes to it. Is it going to completely go away? I don't think so, but we will see some changes to it, and it cut. That unknown causes more fear than anything.
spk_0:
14:23
Yeah, well, can you imagine? Here's my quick answer here. I don't think it's ever going away, Aaron. There may be a new program or an adjustment to the program, but can you imagine you're a politician and so it's in the 2030 to 2034 cash. That's weird to say as he here. While we're not far from 2020 that's for show. Ah, the you mention being a politician, I'm a state congressman or governor, and I'm at a political rally of Ansel. Security goes away, or I don't get my money that I've put away in my lifetime. I'm talking. What people? You are Mr or Mrs Congressman or Miss Congressman. Why'd you let this happen? You really think of politicians going to get up there and want to let down their constituency of not getting all of their money?
spk_1:
15:13
No. And it is very needed. That's the other part of this. We can't forget me. When Souls Treaty first came out, it was paid for a very short amount of time. But now many people rely on that for a long period of time. For it to go away would be completely devastating. and it's not something that's possible.
spk_0:
15:28
Yeah, I mean, there's there's quite a few people You might not even have the statistics. I don't have them in front of me But I mean, it's a pretty amazing amount of people, actually. So security is their only source source of income in retirement. So if it went away, we have a huge civic problem in the United States then. So just for the further as we look at the infrastructure and safety, it's funny to me, is like, this is this is a big thing that's gonna have to be solved yet It's just the cans kicked down the road because no current politician wants to put their down the line. They absolutely don't you? You You
spk_1:
16:04
brought up about point, though, that many people live off of this is their only source of income, and not enough of them actually have that availability to talk to someone like us where they can do so security planning and actually get a better idea of how or when they should be taking that. Because there is big differences between taking it at 62 full retirement age or delaying and tell full retire er, th 70. And that special benefits. I mean, it's very complicated. We've talked about it numerous times. How many rules and laws there are governing this, this program. But for those who it is a massive source of the retirement plan. They absolutely should be coming to someone like us where we can help him do that analysis and figure out what does make the best sense to them.
spk_0:
16:42
Yeah. So, trivia question here for you. So, what do you think the S and P 500 has done per annum since its inception? I'll let you know. You don't have it on the desk. How about just approximately 10%? Okay, it's less than that. It's a little over 8%. Okay. All right. Depends on which day use, but just called over 8%. So if you're gonna return 8% of the stock market, what you have to deal with so volatility. Yeah. So good years, like 2019 bad years. Like 2018 2011 8 4001 Roller coaster ride is what you have to do. What it's the government do for you. If you heat reach for retirement age and you don't?
spk_1:
17:24
Yeah, it's that same 8% But you get it for free and guaranteed. Yeah, well, you know, the
spk_0:
17:29
word guaranteed is not a good word in our profession, because we're not allowed to guarantee results. Um, but the government's gonna guarantee me 8% return.
spk_1:
17:39
Yeah, just for waiting.
spk_0:
17:40
Just for waiting.
spk_1:
17:41
Yeah. That's why I put that in front of a consumer. They're like, Oh, my gosh. This is a no brainer, Paul. And it's one of those things where someone has a small retirement account or a small IRA, and they're trying to figure out Do I take that source, Trudy now, or do I wait and take some money out of my IRA? Well, the IRA we just talked about has volatility. Unless you're going to keep it in cash, it's gonna have some type of volatility risk associate with it. Getting that 8% return on your security versus your investments With that, volatility is a no brainer most
spk_0:
18:11
of time. Yeah, and I'm not saying you have to do that. Our job is to be good educators and explain to all of our clients what's important for them. And how do they make a decision. But if we're good on part one here in longevity and we look like we have a good longevity runway, often any additional amount we can differ on. Wait. So if I took the money now and invested it, what am I gonna have to d'oh invest in the market yet? And so then, to get the 8% I have to be dealing with the S and P 500 then I gotta deal with the roller coaster ride that goes along with it. So is actually counterintuitive that if you're not gonna take it, why would you? Because you say, Well, I want my money. But the reality is, your money's actually working for you by we need
spk_1:
18:52
Yeah, and that volatility also takes into the account. What if you have to take money out in a down market? Now you've hit that double whammy. The the market's down. You're taking your dollars out of a lower balance and to make it back up to even is not just, you know, getting back. It's double and triple the returns you need.
spk_0:
19:09
All right. Another question here, for you, for our audience, is my sole security income taxable?
spk_1:
19:15
Yes, but usually it is. So most individuals do not get their sole security tax free. You have to be in, ah, pretty low income to be able to do that. But most individuals Aaron the associate e 85% of his tax generally.
spk_0:
19:27
Yeah, so it's not taxed at 85.
spk_1:
19:29
No, it's 85% of the total. Is is available for tax.
spk_0:
19:33
I've been asked that question. That would not be fair.
spk_1:
19:35
That's pretty aggressive. That would be almost not worth getting it that thing.
spk_0:
19:39
It maybe isn't worth deferring that they're putting it there. So if 85% of it becomes taxable, so then what tends to happen is is I call it stair steps right? If I wasn't getting the income and I was in a smaller tax bracket and now I'm getting an extra 40,000 year could move me into the next tax bracket.
spk_1:
20:00
Yes, it could. And not just that. It could also change your premiums on your Medicare, and so that is a big part of the cost and expense of your retirement. Your Medicare premiums also go off with that same type of stair step. And so you might have heard someone talk about Irma. Ahh. And so the ERM attacks is literally that the more money you make then your Medicare premiums increase as well.
spk_0:
20:21
People don't associate Irma with taxes. They associated with hurricanes. Unfortunately, Aaron, yes. Ah, so but it is important. So the stair step keeps happening because now I'm stair stepping. I was getting income from wherever. Now I got so security. Now I'm paying Medicare. Oh, by the way, also, I'm now I'm 70 and 1/2. I have to take my
spk_1:
20:40
arm. Dee
spk_0:
20:40
dee. No, I just stare stepped into the next tax bracket, and that's what we call. I think you use the phrase double whammy or double tax because it just keeps compound being on top of each other there.
spk_1:
20:51
Well, in the Medicare premiums and interesting fact on those is that actually comes from your taxes two years ago. So going into 2020 you're actually looking at your 2018 tax return, and so many people aren't thinking two years out before Medicare, which is something we're looking at with all of our clients of Are they taking the right type of income in the right years that to make, you know, help them minimize those future costs and expenses.
spk_0:
21:14
Yep, and I think for a lot of people, when they're worried about taxes is when it's too late. Oh, absolutely. They're worried about it. Come February 1st Ah, instead of December and announce the time, folks. And so a couple things. One. If you haven't taken your are empty this year, you better. Yeah,
spk_1:
21:30
running days and
spk_0:
21:31
all these. Ah, and using a qualified charitable distribution. If you want more information on that happy you just send us an email info at Carson wealth dot com. Uh, or, you know, there's other tax things. Of course. Tax lost harvesting is away. Tax deferred investments, IRA contributions. There's just a lot of different things, and now is the time, because if you wait till January 1st, you're too late on almost every decision you can make there. But let's go back to, you know, thinking about this overall structure. So security, um, really like it can't be your financial plan. So what are other income sources people get in the retirement? Besides all security,
spk_1:
22:13
so so security is by far the biggest one. As we said, there are many individuals who have pensions, which in most organizations that starting to go away. But there's still plenty that have them or of have old ones. We have so many people who go to retire, and when they apply for their soul security or Medicare, they actually get notified that they have old pensions, other that they forgot about or they didn't know that they had. And so those are a nice little surprise. Bonus money for many individuals. We have some individuals who also continue to work or do part time income all through their retirement, not necessarily for the requirement of always income. Lots of times, it's for enjoyment. And then we have the IRA is the Faro in case the 403 B's those by far? I would say, Ah, right after. So security is where we're seeing the biggest amount of income coming from some other ones. Ah, you know, for business owners or executives, we see a lot of stock option plans as well e stops and those types of plans.
spk_0:
23:10
Yeah, I see people also use rental income from housing. Ah, they love that. And I'm a little concerned. Aaron. I'm a huge believer in what we call the herd bias, and you've done a lot of behavioral investing. Studying is, once the herd starts investing in stuff, they tend to lose money because all the money is paid ahead of them. I'm getting concerned because October new home sales were came in way higher than expected. They're up 32.6%. Um, everybody's heard everyone else is making money on real estate. So what's happening?
spk_1:
23:45
So they're gonna start buying rental? Probably
spk_0:
23:47
again. That's just a cautionary flag. I'm not saying real estate bad. I'm just It's concerning to me.
spk_1:
23:53
And the fire movement right now is pushing this as well.
spk_0:
23:55
Yeah, so I want consumers to be smart about this, But personal income is actually flat, and your real disposable income actually fell, so it's just something to watch. People have no problem on Black Friday. Cyber Monday actually heard a new one this week. Travel Tuesday How the Tuesday after Thanksgiving is when the airlines and hotels have better deals is you're now going onto it airline.
spk_1:
24:21
Now I'm going to be honest in the moment.
spk_0:
24:24
Travel Tuesday's the New Term life. They're starting to make up all of these things. And I just remember Thanksgiving you hung out. You sat there you weren't thinking about Hey, should we go the store five o'clock tonight because sales open
spk_1:
24:36
and stand outside in the cold? No, no,
spk_0:
24:38
no. We're here in the Midwest, but I'm just like, ah, part of the day is enjoying it actually was happy I didn't actually fire Recall Leave my house on Thanksgiving and it's fun is like you just you could enjoy what you want to do. And that's part of what we like to call here. Wealth designed life to find living your best life, Enjoying it If you want help, I don't want to understand further your own financial best life. You can text us at 33444 Put in the word appointments and we can have a complimentary conversation with you to talk through your best life when it looks like you're listening. Toe wealth from wisdom.
spk_1:
25:14
Any major decision in life is worth getting a second opinion, and financial planning is no exception. Let's talk about how you could make your money go further in retirement than you ever thought possible. Call Carson Wealth to schedule your free initial analysis now at 888 for 1985 13. Did you have a lot of assets but are short on cash? Learn how you could leverage your assets to free up cash with Carson wealth by calling 888419 85 13 And now back to wealth from Wisdom with Carson Wealth
spk_0:
25:46
Hey, welcome back to well, from wisdom on Paul last my coz today, Aaron would Aaron would be talking about get ready for retirement and those important things like longevity. So security. We started briefly talking about Medicare. Uh, and for a lot of people, they're not familiar with Medicare E. And I see that's happened all the time, and I hear about it where people say, Hey, what Medicare plan are you on? And they'll answer like, okay, and they assume it's the same plan they should be on. Yeah, just because you have to say the same favorite sports team doesn't mean you need to be on the same Medicare plan.
spk_1:
26:18
No, and there's a lot of that. That's one of the biggest things. I don't think people realize most people understand that. You know, there is Medicare Part D, which is your hospital plan, and that is the same for everyone. Everyone automatically gets it when they turn 65 s o that is that's the one across the board. It's your B plan that is incredibly different. And it basically is its own alphabet. That is tthe e a B c D e f g uh, all of them are slightly different. And so everyone needs to really look at each one of those and figure out where their expenses come from. What kind of medical conditions they have. Prescription drug plans again are different. And so those are things that each individual needs to look at and work with. Someone to help pick out a plan.
spk_0:
27:00
Yeah, So here's one of my favorite phrases. You've probably heard it enough for me, Erin, but I'm gonna repeat it is people tended pick the path of least resistance, and this happens in their financial life and happens in many areas, their life right. But in their financial life, they tend to pick the path of least resistance. So, security, maybe finally, early Medicare, figuring out what other people did and not investing the time and energy or meeting with a financial planner that can help them out. So let's talk about a couple of mistakes. People make one picking the wrong plan, Correct. We're not gonna go through all the details on that. But two people make a huge assumption, and I'm gonna ask you so does Medicare include if I go into an assisted living facility,
spk_1:
27:44
Huh? No. So this is one that we do here a lot. Most everyone thinks that Medicare is going to pay for their long term care. Ah, and really, what Medicare will pay for is skilled nursing when you're expected to get better, that getting better pieces is really important for people, understand? And so Medicare will pay for you to go into a skilled nursing facility for 10 days is what it covers 20 days. I'm sorry. Ah, and then the next 100 days you have a co payment. And so a total of 120 days is really all Medicare is going to cover for getting you better at getting you back into your home or getting you back into your retirement apartment or whatever the case may be, but most individuals do assume it's going to pay for it. And it's not. It's gonna pay for those 20 days and then you have a co payment. Ah, that's a pretty large one per day to make sure you're taking care for the next 100.
spk_0:
28:34
Yeah, that's never gonna happen to me here. And Simon's not gonna worry about
spk_1:
28:37
it. Uh, wrong, wrong, wrong, right
spk_0:
28:40
And mean that there's a common rebuttal we hear from people across the country. And the reality is this districts show us that over 50% of people are gonna have to deal with this. It's something that's, uh And here's the thing is like when you're when you're raising your Children, right, you want them always to make the right decisions and your most of us, his parents are maniacal in terms of wanting that good grades have good manners, treating people with respect elders, you know, people of authority police officers, firefighters, all those things. Yeah, we don't teach them and ourselves to have the same level of detail when it comes to our financial lives. No, we don't. We ignore it or we take that path of least resistance of often is doing nothing. But if you have the opportunity, if we all had this ability, if we got to the end of her life, were able to look back and able to make a change. What we frequently see is people that then go into an assisted living care facility or need some form of long term care. Man, I wish I would have done that.
spk_1:
29:47
Oh, yeah,
spk_0:
29:48
I wish I would have that happen
spk_1:
29:49
and we see that a lot with our clients here. There's two types of clients that come in. There's the one to have either had a previously bad experience with long term care, or there's the ones who have seen their parents go through something in. They come in and they're right away on. They know my parents don't with us. I want the long term care. I want the coverage. I don't want to be in that, you know, that situation or my parents did a great job and I want to be just like them. The only time I really see individuals come in with more of that negative is it's something that happened many years ago. Their parents had a really low old, long term care policy, and they're very different today. And so they're preconception that today is the same as it was 40 years ago. Is the issue typically?
spk_0:
30:29
Yeah. So objection number one is I'm not gonna need it. Right? Um, number two is I don't want to use it or lose it. So what trends are you seeing? Just the planning world today in terms of no one likes to invest money and never actually getting access it. So I get that from a behavioral perspective. But what modern techniques are gonna be used to help, Maybe reduce or eliminate that concern for you?
spk_1:
30:53
There's a ah lot of individuals who've been believing more towards the life insurance hybrid plans is what they've been doing. And so in that situation, it's a plan that covers two things. It has a benefit in it to pay for long term care. And if you don't ever use that benefit than it pays out the life insurance at the end of your life, that has become a very popular one recently because of that, that use it or lose it.
spk_0:
31:14
Yeah, well, I think that makes so much sense for people is, Hey, if I'm depositing money and I don't get and don't have to access long term care, at least somebody in my family gets the benefit of my dollars because they many of us, By the way, we're saving investing just to give the money when we're not this anymore, to either Children or philanthropy, your charities. So what's the difference if we're at least put in in this type of policy? By the way, that many of you know, my personal expertise and families I work with is often families that are going through currency conversions, whether it's inside their business, more in transferring money amongst multiple generations. And a lot of them, you know, obviously have enough money that they can self insure, meaning they just use money they already have and pay for assisted living.
spk_1:
32:01
So with your business owners, one of the things that a lot of individuals don't realize, especially with the sea corpse, is you do have the ability to run those through your business as a business on her. So it's a great benefit to yourself, your spouse. Ah, many of the families we work with have multiple family members involved. And when it's A C Corp you can run that long term care premium through the company, and it's a great tax benefit. And then as a individual, you have that policy. Later.
spk_0:
32:26
There's there's a lot of tax benefits for that type of clientele, and we're not gonna go through it all in today show. But what I would share with them is not only is the numbers make sense, but part of our job is a planner is to help provide a meaningful life for people, and also money creates opportunity. But money can create challenges. So I'm sitting there thinking, and I explain this to families all the time. Yes, you can self insure, however. Do you want to be there and be going into a facility and watching your Children disagree, argue or yell about whether
spk_1:
33:02
don't talk to each other again? We have seen that
spk_0:
33:04
mom and dad, mom or dad into a home, and what we tend to see is even when people can self insure, what do they dio? They don't put mom and down the home quick enough because a they think they can take care of them better than other people who, by the way, are trained yes, and have facility set up for them. Or be a hate to say this, but it's reality, and we need to be truth givers and receivers here on well, from wisdom. They don't do it, don't want to spend their own inheritance.
spk_1:
33:31
Yeah, and that one is definitely the saddest one we see but through, But it absolutely is the truth and that fighting over money unfortunately, you know, whether it's big money or small money. We've seen the fights happen, and lots of times those fights happen over something that could have been so easily prevented in if the parents would have just taken the time and said, You know, I know this is going to cause a problem in the future. I don't I don't want to put that on. My kids
spk_0:
33:57
know, nor do I. And if I'm sitting there thinking I'm trying to be the best parent Aiken be, isn't it? Then saying, Hey, I want to take this decision out of your hands because I know it could potentially create a family challenge or drama inside the family. So aren't you even being a better person and planning for them. So you know what? I'm gonna take this decision out of your hands. It's already fully paid for. I've already bought the policy. You might as well utilise it to help you out. And I think I wish a lot of people would think that way. Aaron, they don't but actually would tell you a lot of families that can self insure. And I explain it that way to them. Look at it differently, because what they value most of their lives, their family. Yeah, right. And so, if you value your family the most in, why don't you make the decisions that help them and family doesn't have to mean maximizing the dollars. They get angry, maximizing their your time on this earth with them. I mean, we all we don't know, we could all be picked next and not be here anymore. So everybody who gets sick, of course says, hey, they wish that what I would have maximized their time or with their family and their life and done the things they want to. So, using this type of coverage and thanks for explaining it to us that there are now creative ways and I think a lot of people have preconceived notions that long term care is bad. It can be good. But also remember, how is sharing with you? Earlier in the show about the fiduciary standard and how Northwestern is offered their products, they get paid more as an example. Just be careful here, ladies and gentlemen, make sure you're working with someone who could get you quotes from multiple companies so you can see because there could be a wide, varying degree of offerings and benefits and costs to you as the consumer. If you want help on this, just sent us a note info at Carson wealth dot com. We're happy to explain it further or help give you more information to help you out. You're listening to well from wisdom.
spk_1:
35:49
Have you ever wondered, how do other people get away with paying fewer taxes than ever? One else Learn how you could save thousands of dollars in taxes by calling Carson well at 888419 85 13 Social Security risk taxes and health care. This is where you can count on straight forward an objective advice on the biggest challenges with investing for retirement. And now back to wealth from wisdom with Carson. Well,
spk_0:
36:16
hey, you're listening. Well, for wisdom. This is Paul. Last joined today by Aaron Would Or vice President planning here. You know, we're talking about retirement. We're talking about the key things you need to do. The changes you're making. Ah, we're in the holiday season right now. So speaking of planning, here's something interesting. So, did you know the average price of Christmas trees is up significantly this year?
spk_1:
36:41
I actually did know this. There's a tree short addressed
spk_0:
36:44
here. Yeah. Why? Do you know why
spk_1:
36:45
Flooding. Nope. No, that
spk_0:
36:47
that's a good local service. Let's talk about a national answer. What was what happens is the average Christmas tree takes 7 to 10 years plus two mature. All right, so then they could cut them replanted, that type of thing. What was happening 10 years ago? Recession. So it
spk_1:
37:08
was no one's planning that they weren't planting unliked.
spk_0:
37:11
Yeah. So what happened was is actually 10 years ago ever session. There was less farms, less people planning because they weren't investing money to do that. So now, years later and we're in a way better bullish economy and better end of the economic or better location on the economic cycle, There's actually more demand in less supply based on what happened 10 years ago.
spk_1:
37:33
Interesting. Do you have a real tree or fake one?
spk_0:
37:35
Ah, we have a fake one set away. Yeah, you several tree. But that changed several years ago. Multiple reasons why? Which we're not giving in to the today show. But when I bring out holidays and traditions, everyone loves to plan what you start planning for? Uh oh. I'm gonna buy gifts for people, right. You start saying Okay. Uh, into December. Okay? I start working backwards. One of my work in when I have time off one of my parties was my holiday party ones. My work party. When's my family party? You start doing all this planning, right? I understand. Okay. What am I gonna free time without my Children to go buy them gifts? Yes, we have time. When the world am I gonna get Mom this year? I have no idea what to get her, right. I mean, all those things are part of your planning, so we rack our brains and we spent time. But what do we always D'oh! We get it done. We're not going to show up on December 25th or 24th or whatever date you celebrate. Basically, whatever, you're not going to show up and not have it done, right?
spk_1:
38:35
Yeah, not that would be really bad. Yeah, well, first of what would happen if you didn't. So I'm going to go a little bit all I'm here because we don't do a lot of gifts. And my family, we have narrowed that big over the last few years like it was getting crazy. And I think that's how a lot of people are. It's that Oh, I have to get something for Aunt Sally and uncle whoever. And pretty soon you're running around your head cut off in the whole holiday season is just lost, So stressor. Oh, yeah, and it takes the fun right out of it, and it takes the whole season of giving away. And so we've really consolidated down to trying to do more events and finding time to spend time with each other and and our families. And it's been much more enjoyable for us, so I don't quite have the showing up with no gifts because we've limited that. But I do remember getting to the end of that cycle when we were really big. And I'm like, Oh my God, I'm running around And all of a sudden you're pulling out the checkbook and buying a car, trying to fill in those last those last minute gifts. And hopefully, as people get through these seasons, they get more back to the planning of what's important to them.
spk_0:
39:43
Yeah, and so maybe that's a good segue. Way because plane was important to you is you actually look at your life here is they? People get so worked up over the holidays and they get stressed. I mean, it's it's a huge time for that. Ah, and I don't know why. I mean, I think it's because they're worried about what other people think about them. But if we spent actually is much time worrying about what's best for us and our family, we're all gonna be a better place. Your kid's not gonna know the difference between one more present or not. It's not gonna affect your still their mom, their dad there, Grandpa, their grandmother and their own Cole. They're still gonna love you for who they are, they should be. So. Part of planning, though, as we think about retirement is, is what we call legacy planning when I bring it up in this segment, because think about all this time and energy most people spend looking at gifts, getting ready for the holidays. Yet we can't barely get him to update their will. Set up a trust, actually fund their trust. I love it when people set up trusts. So I have the Paul West family trust. But then I don't actually title.
spk_1:
40:47
Yeah, it's an empty trust.
spk_0:
40:49
Yeah, so it's empty. It has nothing inside of it. Ah, and people just wait and wait and wait and it's just so amazing Me. So let's talk about there's 1000 persons survey recently on carrying dot com. So what do you think the number one reason is why people don't have an estate plan?
spk_1:
41:08
I I don't know the true answer this, but I'm going to guess it's because they can't make a decision
spk_0:
41:13
close. They just haven't gotten around to it. Yeah, they just It's amazing to me where 76% of them realize that having a will is super important, but only 40% of people have one. Yeah, I can't imagine that. I must think about this. I'm gonna goto, um hi, church service And think about only 40% of us in this room have a Well, it's
spk_1:
41:34
a lot of people in the room.
spk_0:
41:35
Yeah, think about that. Goto a Husker football game. You went to your first
spk_1:
41:39
idea first ever
spk_0:
41:41
last week. You're cheering for the wrong team, but we're not gonna talk about that today. Yeah, so we think that there's 90,000 people in there. And if the staffs are true, only 40% of them have a well,
spk_1:
41:52
which when you think about the repercussions of that, it's quite terrifying. If you have small Children now, you don't know who's gonna be guardian of them. The money our assets you have are going to end up in the state. Nebraska controlled by the state s Oh. Now that is a big issue, obviously, for your Children and your assets. If you have adult Children now, you have everything going through probate. Who's going to be fighting over what you have? You know, an antique clock in your house that has been going through for generations. Who's going to get it? You have kids showing up with moving trucks and just moving stuff. These are all things we have seen because the documents were put in place ahead of
spk_0:
42:32
time. Yeah, and I talked about this holiday season a lot, and you may think it's morbid. I actually think it's a good exercise. We sent around the holiday table enjoying a meal or a glass of wine. Have this conversation. I know it sounds weird, but it's actually if you're there celebrating family. Part of it is gonna be a life celebration at some point. And so it's fun exercise or fun? Conversation was, I do. You may disagree. Uh oh. A If we weren't here, who wants that piece of artwork or who wants the chairs are really do want Mom's car Dad's car?
spk_1:
43:06
Yeah, so I've told you before, My husband's ah grandfather recently turned 100 and he has been the best person I've ever seen at this. He literally went through and classified in. They have many things have been passed down for generations generation and went through and said, Here's this Here's this Here's this and started passing things out and getting rid of them way ahead of time.
spk_0:
43:27
Yeah, let's start now. And actually, so I'm taking a class or about done. It's called The Chartered Adviser and philanthropy, so it's can't program. You get a designation, and we keep talking about people feel better giving now. Then they do, waiting to the end. And yes, the will on the trust is the legal conduit that holds those for you. But what about you? Aaron is just There's something nice about gifting something now. I feel fortunate had some opportunities to go to, like some fun events over my life. But I've also had the opportunity to invite other people to go. And I would tell you I actually have more fun inviting the people to hear their reaction. Have something they feel versus even potentially getting to go myself. Ah, and I think the same ways we talked about you go give time and you doing it your time at a food bank or a shelter. I never heard anybody leave their safe. Oh, man, I wish I would've never done that. It's the opposite. What do they say? I should do this more often you won't know what happens. They don't Very few of us. So
spk_1:
44:31
well, you get away from that moment, right? So it's that recency effect. It felt good at that moment and you didn't act on it and put it as part of your your normal environment. And so then you get away from it, and your recency bias has has now went away and it's empty. But there's all sorts of studies out there that show, you know, giving to charities or helping when you pass on your legacy involving your Children, helping them be a part of Where does this money go and what good can we dio is super impactful.
spk_0:
45:00
Yeah, And I just hope people got today hope you're inspired that you're going to make something happen. Whether it's your wills, your trust in yourself, Secure review, figuring out your Medicare, all those things. If you need help, just text us 33 444 The word appointments. All one word Senate toast will respond. Hey, you've been listening well for wisdom. Thanks a lot, Aaron. Glad to have you on the show again.
spk_1:
45:18
Risk such security income taxes, a steak planning every week. We talk about how to make your money go further in retirement right here. Unwell from wisdom with Barron's Hall of Fame adviser Ron Carson. Okay, and here's the legal mumbo jumbo the opinions voiced and well from wisdom with Ron Carson of her general information only, and are not intended to provide specific advisor recommendations for any individual To determine what is appropriate for you. Consult a qualified professional All indices air unmanaged and may not be invested into directly. Investing involves risk, including possible loss of principal. No strategy assures success or protects from Los past performance is no guarantee of future results. Advisory service is offered through CWM LLC, an SEC registered investment advisor.
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