Wealth from Wisdom

Stock Market Volatility and Retirement

April 21, 2018
Wealth from Wisdom
Stock Market Volatility and Retirement
Chapters
Wealth from Wisdom
Stock Market Volatility and Retirement
Apr 21, 2018
Carson Wealth
Show Notes Transcript

One day, the stock market is up 500 points. The next day, it is down 1,000. That is just the new world we live in. We’ve had more stock market volatility in the past few weeks than in the past decade. This poses problem for those recently retired, or who are nearing retirement.

Speaker 1:
0:00
Okay. And here's the legal Mumbo jumbo, the opinions voiced and Wellframe wisdom with Ron Carson or for general information only and are not intended to provide specific advice or recommendations for any individual to determine what is appropriate for you. Consult a qualified professional. All indices are unmanaged and may not be invested into directly investing involves risk including possible loss of principle. No strategy assures success or protects from loss. Past performance is no guarantee of future results. Advisory Services offered through Cwm LLC, an sec registered investment advisor
Speaker 2:
0:31
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 205 the skyrocketing cost of healthcare and retirement could now run 350,000 for retirement. Today is a whole new ball game. It's loaded with challenges, obstacles, the trap doors that you can do this and we can be your guide. Welcome to wealth from wisdom with Barron's hall of fame advisor, Ron Carson, straightforward and objective advice and how you could make your money go further in retirement. And now, here's your host, Ron Carson. One day stock market's up 500 pounds. The next day it's down a thousand. You know what? That's the new world. We live in.
Speaker 3:
1:14
Head more stock market volatility here over the past several weeks. Then we've had in nearly a decade. Yeah, that's 10 years. And what does that mean? It could spell real trouble for anyone who's either recently retired or is nearing retirement. Hey, welcome to wealth and wisdom. I'm Paul West, your host, and I'm joined today with my cohost Jim Caldwell. Jim, welcome. Glad to have you. Thanks Paul. Glad to be here. Yeah, and so really, if you think about it, if you've got any money invested in the market, I don't mean just stocks, I mean stocks or bonds. You really can't afford to miss a minute of today's show. And if you think I'm messing with you, many people know the mega company vanguard will investing tightened. Jack Bogle just recently said, I've never seen a market this volatile. In my 66 year career, I've seen two 50% declines, one 25% decline in one day.
Speaker 3:
2:05
But I've never seen anything like this before. Wow. I mean, think about what he just said and many people look up to that. So what does this mean for you? What does this mean for your investments? What does this mean? The impact on your retirement or your plans? One thing's for sure, 2017 is long gone are the days of all of our complacencies are over gym, but also was gone is your ability to stick your head in the sand because ignoring your investments could be a major recipe or for financial disaster for you. So coming up on today's show, we're really going to give you a no holds barred, five-step know. We'll go through five steps here for you that are an action plan to help you protect your investments in this volatility and really throughout retirement and as part of the well from wisdom show, we want to share ideas of how important it is to avoid volatility and building a plan and putting those things together.
Speaker 3:
3:03
But it's springtime here. Of course, the weather's been quite volatile as well. It's been quite unbelievable here in the Midwest. And at one day at 70 the next day it's snowing so you don't know it's gonna happen. See it? A lot of spring games going on. Of course we love football. I do. I know Jim is a former coach. You do. And when football, when people are dealing with volatility and players and how they're working, what did that coach is always have to go back to a game plan, right? Exactly. Yeah. And if people are aren't adhering to the game plan, what are they going to do?
Speaker 4:
3:36
They either have to make an adjustment or they put a different player out there that's going to listen and execute the game.
Speaker 3:
3:42
Yeah. There's a lot of Sunday and Monday armchair quarterbacks and many of you are listening today that are questioning, oh man, that coach was horrible at a halftime adjustment or you know what? They didn't make any changes in the third quarter. That could've really helped. Well, where are you in your retirement? Are you at the end of the first quarter? You at halftime, the end of the third quarter, you know, what are you in the fourth quarter? And you just need to take a knee or you got to go the length of the field in a short period of time to reach success, you need a different strategy for each one of those.
Speaker 4:
4:16
Well, and the thing about it is you have to have a basic plan. So you go into a game offensively, defensively, special teams with plan a and you work that plan and then you make adjustments based on what the other team's doing. And the halftime adjustments are huge. So when you look at the, the ebbs and flows of a football game, it's very similar to the volatility in our financial markets. Some days you're going to get 600 points up, you might get 300 points down, but if you don't have a plan in place to deal with that, you make knee jerk decisions, you make emotional decisions and usually the end result is not very good.
Speaker 3:
4:52
Yeah, you're exactly right. There's a reason why teams continually lose or why coaches lose because they don't go through with the right game plans and preparation for those things to happen. So let's actually get into the action plan. And what's going to happen here. So step number one, here we go. Keep your emotions in check. Sounds simple, but in reality it's not. This is actually the number one way. Most people get into trouble. They let outside things influenced them, were emotional by nature. As human beings, we get so excited when the market goes up. What happens when the market goes down? We panic. He began to make.
Speaker 4:
5:32
How many times do you see people buy at the wrong time and sell at the wrong time? How many people have come in here or they can't get back into the market? Well, I've been on the sidelines for two years in cash. I don't know when to get back in. They don't have a plan, but it's all because of emotions.
Speaker 3:
5:46
Yeah, well I think about emotions play a long way. Um, I don't own one, but I've sat in a couple before in my life, Jim, and you go in a convertible and the faster you go, the more the wind blows your hair, right? And the better it feels and the more excited you are, probably the faster you're going, the more dangerous it is for you on the roadway. And there's a point where you can maybe keep the convertible, but you slow down and go on a different speed limit. Different roads make your life a lot simpler, but you can still have the joy of the sun beating down on your face and enjoying how you feel and the openness that comes with it. So keeping your most in and check. Here's where a lot of people get in trouble. They let media headlines get the best of them.
Speaker 3:
6:33
That stuff that pops up on your phone, I can't believe, I always feel that. Get all the popups on their phone. What's happening? Distraction. It's just changing your mind, your thought process you're going on with place and what does that make you do? Knee jerk emotional financial decisions based on fear or you make them on greed. You read a story about someone else that made all this money on stock a or bitcoin or whatever else it is. So you get greedy and you want to out beat them on what they did. I got something today in an email. It says stocks are little unchanged, mixed results earnings here, IBM's tumbling disappointing investors that a lot of people get that they're going to go out if they own IBM, they're gonna go sell today. Yeah, I mean those, those types of things. You just can't believe all that stuff.
Speaker 3:
7:20
Yeah. Well think how many people shut off their Facebook accounts the day they saw the headline story about privacy. I know a lot of results for the closed mouth got off Facebook. Why? Because they were upset. I'd use other words, but I don't want to be fine. So it's, it's, there's many frustrating things that happen, but also don't let the media dictate you thinking you're smarter. And here's a great example. How many of you listening today are retired? Or You sit and you have your cup of coffee in the morning and you go look on your favorite financial website, Yahoo, finance, CNBC, or you're sitting there and your kitchen and on the kitchen TV off in the corner you got CNBC playing. And you're watching it while you're having your coffee, your Bagel, whatever you're doing, enjoy your breakfast, your yogurt. Don't think because you watch CNBC for 30 minutes with your coffee, that makes you an expert when it doesn't.
Speaker 3:
8:12
How many times? I know for me, I'll get a phone call from a client and I can hear the CNBC and the backgrounds so loud and I know immediately what the next stream of questions or comments are going to be. It's predictable. Yeah. So I agree. Watching the financial things, if you enjoy them, keep doing them, but at the end of the day don't make irrational or emotional based decisions because let's think about this. How did the TV stations get paid by viewers watching the show? Because they get a sell advertising, right? So what are they would need to do for the TV? They need to make it interesting. They need to make it fun. They need to make it shocking in what do they do? Stories they tell and things are going to be what consumers want to hear or what interests them or shock them and draw them in.
Speaker 3:
9:07
Not necessarily the information. And data they need to hear. So that's why I say when you watch these shows, realize they're feeding you information but they're feeding you what they want to share with you, not maybe what you need to know. And so it really is, you think about trying to time the market. We call it as a fool's errand. Even the pros who spent a lifetime can't always predict correctly. I mean, we're based in Omaha, Nebraska. It's fun every year. Um, we actually at Carson wealth get to participate in a prediction on where, you know, the s and p 500 is going to end up over the year. And I love that they always show the results from the prior year. What happens? About 50% of the people hit above it and 50% of the people who are below it, but they don't know either. What we do know is if you have the right asset allocation and in place and you keep your emotions in check, you're going to make a lot of the right decisions. So Jim, I mean, let's think about somebody very famous Warren Buffet. Favorite quote for me, for him to be fearful when others are greedy and be greedy when others are fearful. So what happens, mark is volatile right now. Jim, what are you hearing
Speaker 4:
10:18
there? While people are asking, is it too late to get in? Some people were saying, should we take chips off the table? Some people are saying, should we play defense? Some are not sure what to do. Um, all I can say is from, from our standpoint is most of the volatility or caused by speculators, people that are trading out there a lot. Your longer term investor, your patient person that will buy some quality and let it go for awhile. Those, that's where people need to be because those people can steady out there emotional stream. Yeah,
Speaker 3:
10:48
I mean I think, I think you're right. I think it, you know, if you're listening here today, um, have you had a situation in the last month where you looked because you saw it on your phone or you saw it on TV at night or CNBC or heard it on the radio that the market moved and you questioned your portfolio. But then what happened? The phone rang. You did something else and then you didn't do anything about it. At Gym, I know we had, this happens all the time. People get, what's my least favorite word in the vocabulary? Busy. I don't like the B word because if you have something you need to do, don't let it fall back. And that's where emotions come and play. Because guess what? We're humans and we have a little bit of an ego. And so we decide to not move forward with something because we're letting our emotions get in place there.
Speaker 3:
11:37
And so let's think about this gym. You know, how many people do you think are good savers? Most, I would say 50% 50% I think it's a little better that I'll be a little more positive view on this. But when you, when you're a good saver, you're thinking to yourself, am I okay? What am I going to be able to retire? How much can I afford to spend in retirement? And so on and so on. But really it's if I'm in retirement, am I spending too much? Can I spend more? And all those fun things go with it, but if you don't get the answers to questions, these things are going to haunt you. And we across the wall from wisdom network, get these calls all the time where people don't know the answer, but when they get to talk to a professional, how they feel afterwards is comfort that they're so glad they know the answer. So imagine if you called us and we were able to help you get that quick answer and what that looks like. If you want us to help, give us a ring at (888) 419-8513 we can help show you how more of your money can go even further in retirement. That's eight eight eight four one nine 85138884195 13 I'm Paul last with Jim Caldwell and you're listening.
Speaker 2:
12:47
The wealth from wisdom, trust, transparency, accountability. These are the values that drive Ron Carson and Carson wealth. You're listening to wealth from wisdom with their, until the fame advisor, Ron Carson, he's a published author and has been featured in Forbes investment news. The Wall Street Journal, CNBC and more now back to, well from wisdom with Barron's hall of Fame Advisor Ron Carson, who's been political unrest with both Syria and Russia. We've got a potential trade war with
Speaker 3:
13:16
China and we have higher interest rates. Whew. That's a lot of negative news. The Heritage Jim. Yeah. Have a nice day. Yeah, no kidding. Well let's get a little more positive. We've even had more stock market volatility, right? More than we've seen in a decade. Yeah, that's a lot of stuff going on. Hey, I'm Paul. Last year joined back again with Jim Caldwell and the welfare wisdom show. Thanks for joining us and what we're trying to help everywhere over listeners today is really putting together a no holds barred, five step action plan that can really help protect your investments and your retirement. So our first step we talked about was keeping your emotions in check. The second we're going to talk about you need to have a comprehensive financial game plan in place. And so before we get into the financial elements of this, I know we talked a little bit about football in the first segment and having the right financial game plan, but I think about game plan.
Speaker 3:
14:08
One of my favorite things to do, Jim, is to travel and go on a trip. It's fun, right? Yeah. Oh yeah. The planning parts, the best part. That is the best part. Yeah. I love it. It's so, but guess whatnot. You think about, okay, how am I going to get their planes, trains and automobiles, right? Actually, great movie. But, uh, you think about where am I going to stay? What am I going to do? How detailed. Many people are probably super detailed. They want to know what they're doing hour by hour, where they're going. Others of you said, hey, I'm just packing my bag and I'm just going to go sit and relax and let all my worries go away. But what's fun is planning out. But what happens? Life happens and you're on your way there and you got to do a connection and the connection fails, or your luggage doesn't show up, or you have this dream day at the beach or at the golf course or going to museum and it's pouring rain or it's closed for a special event, life happens and you're not going to let one of those moments were ruined your entire trip.
Speaker 3:
15:10
Well, the same thing needs to be a place about our step number two here is you've got to have a comprehensive financial game plan in place that can adapt to when things happen. And if you don't have a game plan in place, you're going to be nervous. I mean, right Jim? I mean, I, I don't know how you're not in. What you do is you're being a money avoider, so you're avoiding the most important topic that's out of there. And you're sitting back saying, shoot, this market's volatile. I better, you know what? Maybe I better pull this out. Maybe not. Oh, maybe I should. You know, and you got like the angel and the devil on your shoulders here trying to tell you what to do. But all you're really based in your plan on one thing. Hope, hope. Can it happen? Yeah. Right. And that's dangerous to do. But then there's people who have plans and I think of them as, they're like cool as a cucumber right there. They're not in a panic. They've got a sound, they've got a thoughtful strategy put together. They look at actually market volatile times. Something you said earlier, Jim, is this an opportunity not a fearful mom?
Speaker 4:
16:12
Well you know for me when you're talking about planning, you know we do our six most around here. We have a sheet of paper where we fill that out and we, we plan for our next day at work and I know when I really sit at night and think that through for the next day, I'm much more relaxed working out in the morning, much more relaxed driving in the office. Cause I know exactly what I'm going to do that day in theory. Even though other things come up on days that I may be just do it halfway. I'm not as productive and I'm uptight about it.
Speaker 3:
16:45
Yeah, well I mean, but hey, you have days. I call it the daily whirlwind happens and I'm again, being here in the west, it's not like a tornado, but it's things, you know, you get cold, you get phone calls, you get things happening and um, adjustments and you got to make adjustments. But if you don't have your plan set for the day on what you need to go back to after the whirlwind subsides, you got a problem because then you're back to hope. So, I mean, saving alone is a great start, but it's really what you do with your money that really matters. So let's actually talk about what's inside a financial game plan. So first you got to be able to maximize your social security benefits. Jim, I just had people in and I talk every week. We get calls, we had an individual, you know, that it's filed.
Speaker 3:
17:29
Then maybe they shouldn't anymore. Um, because they thought it was in their best interest. They got advice that way and we found out, well it's actually not the best way and we do, we need to resend and you know, we're talking tens or hundreds of thousands of dollars here and all it takes is a quick meeting with us, with other professionals to solve that problem. So that's huge. If don't let the money you've worked your rear end off to, I'm sorry again, don't want to get fined. You worked your rear end off, you don't want to lose. Why spend five minutes, you spent your lifetime building up your security. Why let five minutes of making a decision dictate your next 2030 however long you're going to live of payments that come to you.
Speaker 4:
18:14
Paul, I had a similar situation two weeks ago where the husband was adamant that he had so security all figured out and I mean I literally had to jump through the phone and grab him by the throat and begging him to let us do our analysis. And sure enough, the analysis came back where he was totally three 60 the other way and we were able to help him solve for that and save them thousands of dollars.
Speaker 3:
18:38
Yeah. So let's talk about other things that are important. So you need to generate income in your retirement. Is this part of your plan? So your retirement income plan, third of your gain, financial game plan, tax reduction, tax optimization, tax planning. Just because you get your taxes done. And I know we just completed taxis in here, it doesn't mean it's over the best people plan for their taxes and figure out how to optimize. Maybe you have some Iras and deferred taxes. You're gonna have to pay money. And remember, once you turn 70 and a half, it's called an RMD required minimum distribution. This is coming out of your account and if you're not prepared for it, watch out cause it can bite Ya. Paul. Tax Man can get you there.
Speaker 4:
19:24
I just started having conversations with people today because all you ever hear is this. Hey, I'm getting a refund. I'm getting a $5,000 $3,000 we'll shoot you. Shouldn't really be getting a refund. You ought to be able to do the tax planning and you should start right now for next year. So that basically when you're, you're turns fired, filed, you're at about zero, you don't owe any more, you don't get any more because why do you want to give the government $5,000 to use of your own money? So if I were sitting out there listening to the show today, I'd be looking at my tax return and saying, where can I go to get some tax planning? That would be at the top of my list right now. Yeah, I think you want to be as close as possible, but I'm being a little bit of it devil's
Speaker 3:
20:03
advocate with you here, Jim. So yeah, me surprise, but there's something different I think about here. So I was in your camp before, but now after my career of working with people, yes they want to be as close to zero. But for some people, the peace of mind, they get knowing there's no chance they're going to have to write a check because maybe they're living month by month or they don't have enough reserves. Those types of things that they have peace of mind knowing they're going to get something back or maybe behavioral wise. Let's go back to the very first one, Jim. Emotions and behavior. Maybe behaviorally if they were getting, let's say they're getting a $6,000 refund, so that's $500 a month. If I divided by 12 months x, maybe if it's, hey, I'm doing all right there. No calculator needed, that's $500 a month, but maybe they're not great savers and they wouldn't actually put that $500 away, so they save that money.
Speaker 3:
21:00
Save is in air quotes there because as you know, the government gets to use it before they do, but maybe they're using that $6,000 to take their family on vacation every year and it just makes them feel good. It sure I would. Sure. Rather than have a little refund, then all sudden they got to pay a lot of money and they're not able to do that and be careful with it. So, so I bounced on both sides on this one. I would say you take the 500 a month and you dollar cost average into one of our solutions and get maybe a four to 6% return over that period of time. You'd go on a better vacation. How's that? You can, but not everybody's wanting to do that and I wish they would, but it's a strategy that can help. Next part of a financial game plan.
Speaker 3:
21:40
Stay one step ahead of inflation. You know, we belabored that on many of our shows. Next, have a great strategy on how to take money out of your Iras, your four zero one k's and other retirement accounts. I like to call that the sequencing effect. You got to find the right order of how to do things. So let's think about how you get in a car. So every morning I'm coming to the office here. What do I do? I've got to make sure. First. The keys are in my file. That okay. Yeah. Yeah. So I get in the car, the opened the door, I shut the door, I put my seatbelt on. Hope everybody's putting your seatbelts on. So one of the best things you can do, put the keys in the ignition. Yeah, my car is still a little bit older where I don't have a complete key fob.
Speaker 3:
22:18
So you can make fun of me. Producer Andrew here. So I turned up to the right. The car starts, I reached down to the gear shift, back it up, put it in reverse, pull out of my driveway, and away I go. That's my sequence, right? Well each one of those has to fall in order. But you know what, I didn't worry about my sequence there. Do I have enough oil? Do I have enough gas, have a trade change, the transmission fluid, the brake fluid lately, but at some point I got to address all those things. And that's like having a full financial game plan. It's planning for your car. Yes. Perfect. Same thing as having a financial maintenance plan. Just like your car. You don't need to worry about every piece every day, but gee, all sudden if you're a transmission brakes on you, what happens?
Speaker 3:
23:03
Costly, ouch. Death of a car, potentially. You don't want that to be your financial plan. So many people today use their retirement vehicles. You're 401k age or four oh three B's, et cetera. That's your transmission. That's what's really generating what's happening with your life. Will you talk, you don't want that to die on you. You don't want to make a monumental mistake where you build, let's say $1 million in new 401k, but because you're not paying attention and you want to retire this year, you're taking the full downside of the market, full growth in the market. So you're pretty happy the last over years. But what if the market drops 30% unexpectedly? Did you know actually every five years the market experiences a peak to trough 30% decline. Yet we haven't had one in 10 years. That's almost double the average. Oh, warning sign there, right?
Speaker 4:
23:55
Yes. So that gives me another thought from a standpoint of what we call required minimum distributions are RMD planning. So we're talking about tax planning right now, whether you're in retirement or approaching retirement, you should start thinking about, okay, what might I have at 70 and a half or what do I have right now and where do I want to take those dollars out of? And what percent is that going to be normally hit 70 and a half. It's 3.96% of the total. So start now. Tax Planning and RMD planning.
Speaker 3:
24:27
Yeah, I mean Jimmy, if you take a financial game plan is just for the Uber Rich, you're dead wrong here. Nobody is exempt from blowing up their retirement and running out of money. And I'd argue it's even more important. I have a plan if you need to make every single dollar counts. So what's a way we can help our listeners is we have what's called our five step retirement master plan, where we focus on those most important things that can help you make the most out of every dollar you've saved for retirement. And Yeah, stop paying as many taxes cause you want to. So if you've saved over a hundred thousand our operators are standing by right now to schedule your initial analysis at (888) 419-8513 what you learn in this analysis could save you hundreds of thousands of dollars or more. So give us a call. (888) 419-8513 that's (888) 419-8513 yeah,
Speaker 2:
25:18
I'm Paul last with Jim Caldwell and you're listening to welcome wisdom. He seems good times and bad times and he's got the gray hair to prove it. You're listening to wealth from wisdom with their hands hall of fame advisor Rod Carson. He's a published author and has been featured in Forbes, investment news, the Wall Street Journal, CNBC, and more. Now back to wealth from wisdom with Barron's hall of Fame Advisor Ron Carson. That was true. I've heard of investing tight Jack Vogel.
Speaker 3:
25:45
What's going to surprise you is what he just recently said. And I quote, I've never seen a market this fall at all in my 66 year career and I've seen two 50% declines and one 25% decline in one day. But I've never seen anything like this before. And quote, Hey, welcome back. I'm Paul West. If last and you're listening to the wealth of wisdom radio network, amazing that somebody like Jack who's at influential, not only in the financial world, but really if you think about the world overall and doesn't it make you wonder Jim Today? You know, how does volatility really impact our investments and ultimately when are you going to be able to retire if his volatility consists air keeps consistent this year. But also if we have downturns and we're really not talking about of volatiles of 1%, we're talking a lot more than that. So I think what's interesting is, is a daily dip of 2% or more happens about five times a year.
Speaker 3:
26:47
We're flying through that here in two was 18. Um, but just turn off your TV. Stop watching that because that's not what the best, what is best for you is we're going to share and continue to share your five step action plan that really help your investments and your retirement. So we've shared the first two so far. You know, first was all about keeping your emotions in check. The second was keeping your comprehensive financial game plan in place and adapting and as possible. Third, manage your risk. And this really gets down to your asset allocation and your diversification. So I'm going to tell you, Jim, you know this, this is just one of those trouble spots that happens with about every single new client we make. They're taking on way more risk than they're aware of and probably more importantly than they need to. And it's like, oh my gosh, I can't believe what happened is usually the conversation and why.
Speaker 3:
27:37
Well, you know, we've been lucky. We've been fortunate. We've had a nine year run up in the stock market that really now could've put your complete asset allocation out of whack. So show me someone who lost their shirt in any of the previous market corrections. A one Oh eight and I'll show you somebody who most likely didn't have a diversified portfolio. So really if you think about this, this is, this is fascinating and Jim, I'm not gonna quiz you on stats today cause I know how, how you love that from me. Good. I'll stay around then. All right, well maybe I will, but they're coming up in the last segment just for fun. So according to Kiplinger from 1926 to 2017 the bull markets we've run on have lasted nine years. And if you don't know what a bull market means, we're moving up. However, if this is the case, we should be really, if you think about the current bull market, we're in coming back to the end because it turned nine years old in March of 2018 well, so now you're wondering if the average bull markets nine years, how long is the average bear market where we're struggling?
Speaker 3:
28:41
We're going down. That fortunately only lasts 1.4 years. However, the average cumulative loss is 41 yeah, that's for 1% what does this mean? We don't know when, but I think we're pretty sure that trouble can be on the horizon. And all you gotta do is look at the most recent market volatility. So you better think about rebalancing your portfolio now before it's too late. And really, you know at Jim, this isn't a onetime thing, oh I rebalanced my portfolio in 2018 I don't need to touch it till 2028 it's not a once every 10 years decision you make,
Speaker 4:
29:25
you look at rebalancing your portfolio and the people that we've met with and, and talk to the people that are allocated properly, they can weather those storms. I kind of look at the analogy of, you know, we're in Nebraska so you'd, everybody's getting excited about big 10 football in football and everything. And if you look at the top 25 teams in the country, the reason why they're so good is there allocated meaning they have depth on their football team. What does that mean? They can absorb some injuries. And to me, injuries and football are like volatility in the financial markets. You've got to be able to manage them and you've got to be able to allocate them.
Speaker 3:
30:04
Yeah. Well I think that's a good story. I mean, Jim, I think about it. So you come to October and they look at, we're going to talk about college football of course, right? Gotta love come here quick enough. But there's a lot of times there's a team that's ranked in the top 10 but they lose their star quarterback or running back or linebacker a series of people. It often is and they're not able to replace them and their game plan and was to win the national championship. Well they gotta reset the goals is can we just, even when our conference championship or can we go nine and three or eight and four. And if you don't have the right game plan in place, guess what your risk you've just taken. And that's why, you know, you see many of these successful schools, the depth they have so that if they lose risk of an individual player, and Jim, I mean I think about that as your portfolio.
Speaker 3:
30:55
So how much depth do you have in your portfolio? I think about some individuals were in the other day that we talked to. So imagine this you, you spent your time and you know, I'll just use round numbers for an example here to make this story easy. So you saved $1 million or 2 million, whatever the number is, but what if you own a couple of funds, a couple ETFs, and then you own like three or four stocks. One of those stocks takes a hit. Well, think about that. If you've got four defensive backs and you play for defensive backs and one of them takes a hit and is gone, what happened?
Speaker 4:
31:32
Well, you're, you're digging into somebody with no experience or you're, you're, you can't run your nickel package. You can't put five dbs, you're, you're in trouble. You're not diverse.
Speaker 3:
31:43
Probably watching the other team celebrating the zone is what you're doing and you're crying and you lost the game. But you could have won the game if, what if you would've had on the sideline all of the other stocks that you were interested in that you could have put in the game? Or what if you load it up the defense and had the right package there in the beginning, your nickel, your dime, or whatever else that would have put you in the right defensive posture? Um, I love the, what is it? Is it the GEICO commercial where they're showing a bunch of parents that are aging and one of them says, yeah, and now I'm telling my kids defense wins championships and Oh yeah, what's wrong with his flip phone? It's, it still works. Well, you know what? Sometimes thinking has to evolve and your asset allocation has to evolve.
Speaker 3:
32:31
Many people were actually very fortunate here at Carson wealth is we have an allocation tool that allows us to analyze risk. You know what's great about this? When you watch CNBC or you go talk to an advisor, you know what they do? They give you a subjective yeah, that's their opinion on if that's a good stock or that's a good fund or that's a good ETF. But what if actually you are able to generate a report. And by the way, we do this complimentary for people that you can run a report that shows you exactly what you hold and it shows you how much upside opportunity you have, but more importantly, how much downside risk you're taking in the market. How powerful is that? Well, it gives you an opportunity to at least see it on paper of where you are. And I think [inaudible] not somebody like Jim Cramer Gaelen a buy the stock or sell this one based on this.
Speaker 3:
33:30
This is real data based on historical information that can help people. It turns it from subjective to objective. And Paul, I look at it like, um, a lot of people out there still trying to do this on their own. They don't have the experience, uh, that a trusted advisor would have. So it's, it's no different what we talked about earlier. When you have to bring in that fifth or sixth defensive back and they don't have any game experience, you know, how are they going to perform under pressure? So I, I would think people out there would want to look for a second opinion from a firm like ours that could lay that out for him. Yeah. Well, I mean I think Jim is just what, what, what's fascinating to me is, um, people call us up, you know, and they call us at eight eight, eight four one nine 85, 13.
Speaker 3:
34:14
And when they do that, they're able to get provided very quickly a complimentary analysis of their situation, not just the market or better yet not a broker who's, you know, selling the same stock or same funds to every single one of the people. But they get to personalize what it really means for you and what happens and what's important and I really hope is you're listening today's show then if there's just one thing you get from today's show is that you need to have your investments looked at and how you're rebalance them. Because really think about that volatility we're talking about in the market right now is there's risk out there, but this isn't something you can put off for 30 days or 60 days and this is something you need to do right now. I think about all those times in your life where you just, you kicked the can down the road and you were too late.
Speaker 3:
35:03
You wanted to buy that sport ticket or you wanted to buy something and whoop, it's gone or were shit. You did something and it costs you a lot more than you wanted it to because you delayed. Don't delay. Help yourself. Make the right decision. Be One of our callers right now at (888) 419-8513 and we'll help you think that and really just one meeting. We're not asking you to make a change. Just one meeting could give you an idea that literally save you thousands of thousands of dollars in retirement or save you from making a significant mistake dramatically and losing out on opportunities for your retirement. That's (888) 419-8513 (888) 419-8513 after break. Listening to our last two steps here on helping you fulfill your steps in the right way to protect yourself from market volatility.
Speaker 2:
35:52
How could you make your money go further in retirement? Learn how next unwell from wisdom with Barron's hall of Fame Advisor Ron Carson. Is it possible you could pay fewer taxes in retirement and keep this money for yourself? You could learn right here and right now, unwelcome wisdom with Barron's hall of Fame Advisor Ron Carson. We've been in the second longest bull market in history related to stock. Stock
Speaker 3:
36:17
Market's been about unstoppable, Jim hasn't it? And it's really loud investors into complacency, but the reality is, is the recent volatility in Wall Street has investors concerned and starting to real emotionally. Hey, welcome back. I'm Paul West and you're listening to the welfare wisdom radio network. My cohost today is Jim Caldwell. So if you think about the recent stock market volatility, what does this mean for you and your investments and how is it going to impact your timing to retire? Today we're talking about a no holds barred, five step action plan that could help protect your investments and your retirement. So, so far we've talked about keeping your emotions in check. We've really talked about building the right game plan for yourself. We've talked about you know, how to you manage your risk allocation. So next, let's talk about step number four, which is make sure your social security plan is recession proof, which it is.
Speaker 3:
37:10
So take advantage of that. So the stock market's going to go up and down, Jim, right? It does. It does. Yeah. How many days is it? And even at 0.0, zero, uh, I can't remember it either. But your social security benefits, it's going to be a welcome, steady, consistent paycheck in retirement and ignore all the noise you hear like, oh, it's a security's going away, or 2034 it's not funded. The reality is, we've talked about this on the show there. That's one of the first time it could potentially be underfunded. But again, I go back to the government's going to figure this one out. What politicians want to going to be an office that said, oh, we're the ones that allowed everybody's paychecks. Who's they work so hard for to get less money there. It's not. So most Americans though, Jim take their social security at face value and that's why it's the number four because they wind up leaving tens of thousands of dollars on the table.
Speaker 3:
38:03
I don't want you to be one of them because everybody's situation is different. Don't listen to your brother or sister in law, your father or father in law of mother, mother law, their situation was different. Yours is unique. Hey Jim, everybody's got their own fingerprint, right? Correct. Ernie to fingerprints the same. No. No. Why? They're unique. So is your social security analysis. You need to figure out what's the best decision for you. Paul, I got to share a story with you and I'm almost embarrassed to do it. I mean I've been doing this 26 years. So
Speaker 4:
38:36
my wife and I had a conversation about so security and I actually thought I could figure it out on my own. You'd think you know doing it forever and I start playing with some numbers and looked at our statements that we got and then I had Beth run a social security analysis here at Carson wealth. I was totally wrong on my estimation. I had the wrong dates, I had the wrong numbers, I was almost embarrassed. Beth was like laughing at me. So if, if I'm that unsure and I'm going to make that mistake, what might some one of our listeners be doing out there? We can help them with that.
Speaker 3:
39:13
You're involved all the time with that and people don't think about it. But the reality is is you know how simple this is is. So if we help run an analysis or anybody does your professional, they should be able to show you two things on the screen. One, what you think your plan is and to what your ideal plan is and we'll show you a break even analysis where they cross off so you can make the decision. It's simple to the point. Hey, actually if you want one of them, you can just call us. It's (888) 419-8513 and we'd be happy to run one for you. Again, no obligation, no cost to do that there. So let's move to step number five and I think Jim, we were sharing a lot of real world things that our listeners today can take action with because we've been seen market volatility, but again with market volatility comes risks and risk number five and the step you need to is how do you increase your returns in retirement are the most important thing you do?
Speaker 3:
40:07
Can you lower your tax bill? Right? And this is one of the most overlooked areas because there is a gigantic difference between tax preparation and tax planning. Tax Prep. Let's just be clear on this. That's what's done with your CPA. But that's looking backwards. You can't do anything about it, that the ink is dry, right? But if you truly want to pay fewer taxes in retirement, you have to have a forward looking strategy. But again, you don't set it forward and say, oh well nothing's ever going to change what just happened in December? The tax and jobs act, right? We just, we went through a major change. You got to keep adapting and that's why planning is more important now than ever. But also when you're in retirement, you have more control than ever before because of tax deferred accounts, tax free accounts, so security, income, pensions, there's different tax treatment for all of those.
Speaker 4:
41:07
And the big thing there is you're, you're taking a, your paycheck is from yourself so you're not getting it from an employer anymore. So you've got to be able to manufacture what's optimal for you. And I will tell you this, I actually spent some time over the weekend looking at my tax return and, and looked at a couple of comparisons with previous years. Let me tell you what, there are some moving parts with this new tax bill. And if it, if you don't have tax planning to go along with tax return,
Speaker 3:
41:34
you could, you could be in trouble down the road. So one of my favorite things to show people gem is eh, because I could say it till we're blue in the face because not everyone is a good verbal listener. So they're great. Listen the show, but then I want to show them or our advisor across the network shows them. So what happens when somebody turns age 70 and a half, the proverbial required minimum distribution from their qualified accounts. Yeah, let's shorten that up. RMD. RMDS. All right, we'll make it easier for everybody here. So guess what? You got to take money out of your account. And when you take money out of your IRA, guess what? You pay taxes. So it's amazing to show people when they're 70 and a half and they take this money out, what the tax bill looks like. I've yet to see someone look across the table at an advisor Jim and say, okay, great, that looks good.
Speaker 3:
42:33
No, it's like, it's like you're putting a thorn in their side and you're like, stop, stop, stop. And you know something. There's so many tax planning vehicles that are out there. I mean, I'll give you one. If you're a high net worth individual or family and you're having to take huge RMDs from your IRA accounts, you can actually donate a huge portion of that money to charity and get a big, big tax break on that. Um, it's like $100,000 for an individual and 200,000 for a household. So a lot of people don't know that's available. But that's it. That's a super way of, of lowering the tax bite there. Now it definitely is, Jim. I mean, and we're sharing today, you know, five steps that help protect you from market volatility. But the reality is, is again, for everyone, important things to keep in mind that are simple.
Speaker 3:
43:25
So one of the things we love to do is make the complex simple. So did you know market's average one annual 14% decline every five years, the market's declined, 30 plus percent. Markets rise almost three. Pr Three fourths of the time, over long periods of time market significantly beat inflation. And now this was going to surprise you to hear Jim, but selling low and buying high, selling low and buying high doesn't work. I love it. Emotion, right? Punting on third down. Yeah. Well sometimes punting on first down maybe. Okay, how about that? That's a little bit better, but never make important decisions based on emotion. You know what? How many of you heard walk away, you're in a, you're in a stressful conversation with your spouse or a family member and you go walk away. I love the, you know, go walk outside, go, go get some fresh air walk.
Speaker 3:
44:19
The same thing happened with, yeah, with your financial situation, but these are the facts of life here, everyone and in the market and what's going on. And if you don't have this action plan in place, you're going to have a tough situation. And one of the toughest situations you often have is with taxes. And we want to help people. It's one of our favorite things to do because you don't want to get riddled with the trap doors that are out there and pay more to the tax person than tax man then possible. So think about all that money you were going to get a retirement. And what if you get way less because of taxes. So we want to help you. (888) 419-8513 this confidential, this is complimentary and this was with a very comprehensive company that's going to help you. (888) 419-8513 that's (888) 419-8513 hey, on Paul West, been joint with Jim Caldwell. Thank you so much. And you've been listening to the wealth from wisdom radio, network
Speaker 2:
45:16
risks, social security, income taxes, estate planning. Every week we talk about how to make your money go further in retirement right here on weld from wisdom with Barron's hall of Fame Advisor, Ron Carson. Okay. Hey,
Speaker 1:
45:30
here's the legal Mumbo jumbo. The opinions voiced and Wellframe wisdom with Ron Carson or for general information only, and are not intended to provide specific advice or recommendations for any individual to determine what is appropriate for you. Consult a qualified professional. All indices are unmanaged. I may not be invested into directly. Investing involves risk, including possible loss of principle. No strategy assures success or protects from loss. Past performance is no guarantee of future results. Advisory services offered through CW m L L C an SEC registered investment advisor.