Episode 140 – Retirement Tips You Should Avoid

On this week’s episode of On the Money with Secure Money, Brian Quaranta announces the official release of his new book and shares bogus retirement tips you should avoid.

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Radio Show Transcript

Announcer 00:00

Investment advisory services are offered through foundation investment advisors, LLC. an SEC registered investment advisor. Brian Quaranta and his guests provide general information not individually targeted, personalized advice and are not liable for the usage of information discussed. Exposure to ideas and financial vehicles should not be considered investment advice or recommendation to buy or sell any of these financial vehicles. This information should also not be considered tax or legal advice. As performance is not a guarantee of future results, investments will fluctuate and when redeemed may be worth more or less than when originally invested. Any comments regarding safe and secure investments and guaranteed income streams refer only to fixed insurance products, they do not refer in any way to securities or investment advisory products, fixed insurance and annuity product guarantees are subject to the claims paying ability of the issuing company.

Brian Quaranta 00:39

When planning for retirement, it does seem like everybody has advice for you from coworkers, distant family members, hey, we’re only trying to help they say on today’s show, we’re gonna highlight several bogus pieces of advice that you should avoid, we come right back with on the money with secure money. And now on the money. Any good retirement plans starts with the foundation,

Announcer 01:03

asset protection, tax reduction, holistic planning,

Brian Quaranta 01:06

these are the things that start to move you towards having a retirement plan.

Announcer 01:10

Retirement doesn’t have to be complicated.

Brian Quaranta 01:13

You think that’s the difficult part that’s just getting started. And now on the money with secure money.

Steve 01:24

On the money with secure money, Brian Quaranta, I’m consumer advocate Steve’s at all and of course, we have got a big show for you today. As always, Brian is author and he’s president and CEO of secure money advisors, and so much more. Hi, Brian, how’s things?

Brian Quaranta 01:39

Yeah, Steve, and it is the truth, we have officially gone to print with the book. So, Oh, you’re excited. The Right Track retirement. And it’s all about a simple planning strategy to help mitigate risk, help you build the income and give you peace of mind and confidence in retirement. So, look for that on our website here in the next coming probably 30 days. And we’re also going to be offering a copy of the book on our upcoming shows. We’re very, very excited about it. It was two years, Steve in the works.

Steve 02:10

I know we’ve been talking about it a long time. Yeah, I know. It’s different iterations in different places, that kind of thing. Yeah,

Brian Quaranta 02:16

yeah. Well, you know, a lot of people hire people to write their books. I wanted to write the book myself. And I did. And, you know, obviously not being a writer or an established author. It took time. And, you know, I had good, some good mentors along the way. But we’ve got a great book. And it’s 20 to 23 years’ worth of advice that I’ve learned in the world of finance. And you know, this is all I’ve done for 23 years. So you’re getting, you’re getting a lot of information on one book on, on how to doesn’t matter whether you’re working with an advisor, you’re seeking out a new advisor, or you’re a do it yourself, investor, this is really a great book for everybody to understand the ins and outs and how to build a better retirement that provides for better peace of mind and confidence going into retirement, especially market volatility. And certainly, oh, we are seeing a lot of market volatility right now. And I’m sure that everybody’s getting advice from coworkers and family members. And that Uncle Joe, right, Joe, Joe’s, the family investor, he, he’s made a lot of money buying stocks. But what a lot of people don’t understand about these, these individuals that give advice about investing is that typically, they might only be given you half the story. Meaning, you know, take a guy like Jim Cramer on TV, right? What’s the name of that show that he does? It’s called Mad Money. There you go mad money? Yeah, so he’s always given out stock tips. And, you know, there’s all kinds of publications that you can buy around buying individual stocks. And the problem is, is that the stocks that people are telling you they’re buying, if they lose that money that’s not harming their lifestyle or their retirement, people are taking risks with money they can afford to lose. The problem is the average guy hears that think about all these people that have run out and got Robinhood accounts or TD Ameritrade accounts. I’ve talked to a number of people, you know, that are getting stock tips from Wall Street bets, which is on Reddit, and they’re risking 100% of their life savings. And this is not the way that we build a solid retirement. You know, there’s two types of money, there’s retirement money, and then there’s investing money. retirement money needs to be looked at a little bit differently. I believe in wholeheartedly that that money needs to provide most people with a stream of income in retirement because the number one factor that everybody is dealing with is, is that nobody’s getting a pension anymore. About 90 plus percent of the people that walk through my office are not getting a pension. So, the money that you’re accumulating in your retirement savings, whether it be a company 401 k or a 403 b or 437 plan, folks, that is your pension. That’s not money that you just go out there and roll the dice with and Um, you know, hope for the best and buying some, you know, some hot stock tips that you just got, I mean, you don’t do that with that kind of money, money that you buy stocks, with individual stocks with his money that you can afford to lose or money that you have a very long time horizon with. And we certainly do know that, you know, time is your friend when it comes to investing in the stock market. But if you’re taking risk in individual stocks, and you’re going to need that money within the next five years, or maybe you’re taking risk with individual stocks, and you’re already retired, you got to be very careful in what you’re buying and how you’re positioning that because, you know, market volatility is a real thing. And we’re seeing it right now. And, you know, certainly especially if you’re planning on taking money out of those accounts, if the markets going down, and you’re taking money out of those accounts, while they’re down, you’re just compounding the loss and locking into last. So, you know, and everybody has an Uncle Joe, right? Yeah. Joe’s the smartest investor at that at Thanksgiving dinner, oh, my uncle Joe, he’s made a ton of money in stocks, well, that’s great. Those are great stories, everybody’s got a story about making a lot of money in stocks. But it doesn’t work out that way. 100% of the time. And you got to understand if you’re in the accumulation phase, it’s easy. All you need is time, and you pick a good stock. But what happens when you’re in the distribution phase, you know, look at Facebook, right? Now, let’s say that you had a good portion of your portfolio on Facebook, and overnight, it goes down. 23% Not a problem. If you’re 40 years old, 30 years old, or even 50 years old, you might not need that money for you know, 10 or 15 years. But, you know, if you’re retired and you have a good portion of your money in Facebook, and overnight, it goes down 23%. And you rely on that, that those accounts to generate monthly income for you. Now we’ve got a problem. And this is where people, you know, this is where we see people having a high probability of potentially running out of money. And we don’t want

Steve 06:49

that, obviously in retirement. And so, some of the advice that that we get often surrounds Social Security. And that advice may be well, I took it at 62. And social do well, I took it at my full retirement age and social do well, it doesn’t I mean, so should you probably not, or maybe you should. But that’s what needs to be discussed. Everybody’s different when it comes to social security. Well,

Brian Quaranta 07:12

part of building a retirement strategy is the step one is having a distribution plan, an income or cash flow worksheet. So how do you know without running the numbers, what’s going to be the better time for you to click Social Security? I can tell you this much for most of our clients, we collect sooner than later. Why? Because social security is only a benefit that you get while you’re living. It’s only guaranteed while you’re alive. And the other question is if you want to retire, let’s say, at the age of 62. And you want to delay taking your social security, but you want to retire, and you don’t have a pension, well, where are you going to get that money, that means you’re going to have to take the money that you need out of your retirement accounts, which also means that you’re putting a lot of pressure on that money very early on in retirement. Why would we create Why would we create that much pressure on our retirement savings, when we could subsidize what we need from Social Security and again, it’s only guaranteed wire alive but this is why we’ve built our right track retirement analysis Steve, and for the next 10 callers who call in right now we are going to give you a complimentary right track retirement analysis could have over five key areas with you it’s going to go over your income, taxes investments, health care strategy and estate planning. I’ve seen other people charge $1,000 or more for similar features or offers but we are going to do this complimentary it’s truly going to take the mystery out of financial planning and give you turn by turn directions of how to get from point A to point B, but you’ve got to do your part you got to pick up the phone. Call us right now and schedule your right track complimentary analysis today.

Steve 08:45

800-656-8616 10 callers right now get the financial review, and you will see where you are today. But more importantly, you will get them a roadmap that can help get you to where you need to be when it comes to retirement. 800-656-8616 800-656-8616

Brian Quaranta 09:05

women generally live longer than men and their relationships with money has certainly evolved over the years, but it couldn’t be better when we get back we’ll take a look at some differences between men and women when it comes to retirement planning. And we come back right here with on the money with secure money

Announcer 09:26

do you ever feel like you’re fighting for financial knowledge? Don’t let that advice be a punch in the gut your retirement to take advantage of a complimentary no cost no obligation consultation with a local trusted financial coach called Brian Quaranta host of retirement you radio 800-656-8616 or text Brian Q to 800-656-8616 we’ve made it easy for you to take advantage of this fantastic offer. All you have to do is call or text Brian Q to 800-656-8616

Steve 10:03

And we’re back on the money with secure money. And I’m consumer advocate Steve’s at all and uh Brian Quaranta is also here, Brian, of course, President CEO of secure money advisors, that website, by the way, secure money advisors.com, check that out, you guys do a great job of really putting together a lot of great information and making it readily available to all of us. I know your TV shows are there, the radio shows are there. But almost more importantly, is the just the information, the blog, like information that’s out there.

Brian Quaranta 10:33

Yeah, you know, I just had a guy call in the office last week. And he said, Brian, he says, I was referred to you by a friend of mine, I wasn’t really sure. You know, if I was considering even changing advisors or getting a second opinion at this point, but I’d got on your website, and I started listening to some of your radio shows, and I was watching a lot of your TV shows that you have archived on your website. And he said, you know, you were talking about a lot of things that I hadn’t heard before, especially when it comes to retirement planning. Because I truly believe, Steve, that most people when we say the word retirement planning, most people believe if they have a, an investment, let’s say a 401 K, and they have investments, that they have a retirement plan. But in fact, that has nothing to do with having a retirement plan. That’s an investment. Having a retirement plan is all about having a true written plan. What do I mean by that? Well, it means you have an income plan. Why do you need an income plan? Well, because an income plan is going to tell you exactly when you can retire. A lot of people have a lot of income sources moving in and out at certain times. Maybe if you’re married, your spouse wants to retire a couple years earlier than you and you got to see the way that that income fluctuates. The other thing is, if you’re married, you got to see what happens if your husband dies first, or your wife dies. First, what’s a drop in income gonna be second part about having a retirement plan is the mitigation of taxes. So, when we retire, you know, the paychecks gonna stop, but bills, taxes and all the things that you want to do in retirement, that’s not going to stop. And for most people, their largest investment is in some type of tax deferred retirement accounts. So, when they pull money out of there, they’re gonna have to pay taxes on it. How nice would it be if you didn’t have to pay taxes on that, and you can make that money tax free, simple things like doing a conversion and the timing of conversions can help with that. Three is making sure that you own the right investments. You know, most people are buying investments not knowing what their downside is, I’m not too concerned about when the markets up. That’s easy. Anybody should be making money when the markets up. The question is how are the investments going to perform when the markets down? And how much loss can you absorb at this point in your life? So, one of the things that we focus on is determining what we call the drawdown. Now everybody’s portfolio has a drawdown, and you can figure this out by looking at your investments, and you’ll see the historical drawdown of your positions. So, what do I mean by a drawdown? Well, I had a couple come in last week. And they had a lot of different mutual funds, with some very large, big name companies, good mutual funds, nothing wrong with it, but they were they were definitely risky mutual funds. And when I looked at their drawdown, their drawdown was 45%, which means that the market corrected that portfolio could lose as much as 45%. Why is the drawdown important in retirement because the losses will hurt you more than the gains will help you so controlling those losses is the best direction to go. And you could do that through tactical management. Why tactical management, because we’re not looking to outperform the market, we’re looking to have more stabilized returns in retirement, especially since people are looking to generate cash flow for is making sure you have a good health care plan in place if a health event were to happen. And five is making sure you have a good estate planning documents in place. So, these are all things that are very, very important that need to be looked over. But let’s get back to women here, right. So, women generally live longer than men. Now darling, we have a lot of we, we have, and this is true, we see this in our proud 23 years of doing this, we do have a lot more widowed clients that are female than male. So, and we have a lot of single widowed and divorced clients. We tend to get referred a lot of women and you know, it’s because we do something very important. And we’re providing peace of mind by showing them how to properly handle their money to generate the monthly income that they need, without the risk or worry of running out of money. But you know, a survey says that a survey by the wealth management division of UBS found that 85% of women manage everyday expenses, but only 23% take the lead when it comes to long term financial planning.

Steve 14:36

So, there’s another reason education laps there. I mean, that’s what it’s all about, isn’t it? I mean, that’s one thing. I mean, if she already is doing the day to day and I know that’s what it’s like in a lot of households. Yeah. She needs to understand the bigger picture

Brian Quaranta 14:47

Correct? Yes and how that money operates because if you’re the one that’s in charge of handling the expenses, then you should be the one that also is educated on how to generate the cash flow and understand I need how to manage that cash flow from the investments because remember, when you want to retire and you want to leave work, that paycheck will stop. But bills, taxes and all the things you want to do, that’s not going to stop. So, understanding cash flow and educating on cash flow is important. And that’s where taking an understanding of the long term financial planning decisions is very important. So now they say there are four key things that women should know when it comes to making decisions about their money. Okay, go home, no, well, so let’s break them down one at a time, we’ll say longer life expectancy means that extended retirement so on average, women live five years longer than men. But a longer life can mean more complexity, right? So as women live longer, they need to find retirement that stretches across more than 30 years. I just had a lady come in the other day schoolteacher going on her 40th year of retirement,

Steve 15:50

Oh! Of retirement! Wow!

Brian Quaranta 15:51

why retirement, but she spent 30-35 years in the workforce. She’s on her 40th year of retirement and unbelievable. So why was she hanging off my office because 40 years of retirement, you want to know where she invested her money bank CD’s. She said, Brian, for years, I put my money at the bank because I could get you know, 5,6,7 percent, you know, she was telling me stories of when she used to get 12-15% on our CDs. But the problem is she used the money that you know, she that the money that she’d saved, she always went to the bank bought CDs, and she would use that interest every year to you know, to live off of but now she’s actually dipping in the principal because she can’t get enough interest at the bank. And, by the way, folks, you don’t need to do that. Because there’s great alternatives out there. Fixed annuities right now pay between three and three and a half percent, you can take money out of them. You know, they’re really great for cash flow depending on your situation. They do have a maturity just like a bank CD, but great interest rates. But the other thing is women tend to avoid risk and Miss growth opportunities too. That’s true to this woman’s case, right? All of our money’s in the bank city. though women are less likely to invest in men, they are more likely to have a cash emergency fund however, their emergency funds are often too large. That’s why I’ve created the right track retirement review. The Right Track retirement review truly was designed with the you the radio listener in mind, because it’s going to help you identify key five key areas retirement your income taxes, investments, health care and estate planning. So for the next 10 callers who call in right now we are going to give you a complimentary right track retirement analysis, it’s truly going to give you the clarity and peace of mind you need going into retirement or if you’re already in retirement, how to properly manage things a little bit better than what you might be right now I have seen other people charge up to $1,000 for similar features or offers, we’re going to do this to you, for you complimentary, no cost to you, the risk truly is on us. But you got to do your part, you got to pick up the phone, call us today and schedule that appointment.

Steve 17:44

800-656-8616. Again, 800-656-8616.

Brian Quaranta 17:50

When we come back, we’ll highlight several mistakes that retirees make. And we’ll tell you how to potentially avoid them when we come back right here with on the money with secure money.

Announcer 18:04

He’s letting the clock run out on his social security to age 70 For maximum benefits. And here comes the Roth conversion. He’s got some outstanding coaching with that lifetime income plan. He’s created his own pension as well. And it looks like he’s going to go All! The! Way!

Play your best retirement game call Brian Q 800-656-8616. Or text Brian Q to 800-656-8616. Call or text Brian Q to 800-656-8616.

Steve 18:40

We are back on the money with secure money and Brian Quaranta and consumer advocate Steve’s got a great show today prime minute boy fast paced lots of stuff going on. So, as we round the corner into the new year and things are people were feeling a bit more optimistic. What kinds of things have you got planned for the new year that there’s going to help that education process that you care a lot about you care a lot

Brian Quaranta 19:02

about that? We do not I mean, you know, and you know, Steve, not only do we do on the radio show, but you know, we have the TV show that airs which by the way, if you want to see any of the TV show, the schedule of when we’re on is on our website. So, you could go to WWE dot secure money advisors.com You can see when we’re going to be on, but we’ve also taken the TV shows and radio shows and we’ve archived them on our website. So, if you want to go in and get educated and you can do that right on the website by watching the TV show or radio show. So, it’s really great. Not only that, but we’re also going to be updating the list of educational events. We’re going to try to do about 60 educational events this year where you can come out at one of the universities like Robert Morris or LaRoche college and sit down with us and go through an educational course on this right track retirement system where we really teach you from start to finish how to build a really good plan and most importantly keep it very Simple and easy to understand. Because I’m telling you when you have a plan that’s simple and easy to understand. And it’s a tangible physical plan, a written plan. This is, this is what people are missing so much, Steve is that they have a pile of investment statements, but they don’t have a real written plan. Folks, I’m telling you, when you get a real written plan in place, and it’s in, it’s easy to understand, and you get it, boy, the confidence for you to retire, stay retired, do the things that you want to do on your bucket list in retirement with a peace of mind security, that you’re not going to run out of money that you’re not going to have to go to work. Boy, that’s a real position of strength that you’re in. And we hear that all the time from our clients. The other big thing that we hear is when clients are coming in to see if they can retire, they’ll say I want to retire in five years. Great. You want to fire five years? Why don’t we look at two plans? Why don’t we see what retirement two years would look like? And what five years would look like, Oh, I’m not ready to retire in two years? Well, let’s build a plan around two years and five years, okay. So, we do that we build a plan around it, they love it, they wind up going forward with us. And what do we do a year later, we get a call, and they say, you know, I think I’m gonna retire in two years. Okay, great. I mean, what a great position to be in, right? You walk into work one day, somebody ticks you off, you don’t want to be there anymore, right? You’re just fed up with it, you’re burnt out, and you go, you know, I don’t need to do this anymore. I know, I’m going to be fine. I’m putting in my paper for retirement. And that’s the type of leverage we want to give you. That’s the type of clarity we want to give you, and confidence to be able to do what you want to do when you want to do it. Right.

Steve 21:29

Wow, that’s fantastic. 800-656-8616. I love it. When you get all passionate like that it really makes sense. So, let’s see what let’s see what the listeners are saying today, Lillian has checked in, she says, I don’t have a retirement plan through an employer, what’s the best way I can save money and lower my taxes? While she’s thinking? Right?

Brian Quaranta 21:49

She’s thinking, right? Yeah, but she’s thinking, right, because obviously, if your employer is not giving you a plan, there’s a few things you could do. If you could, you could open up a traditional IRA account. And you can make contributions to that, which would also give you a tax deduction. But keep in mind with that tax deduction, you’re now going to have an account an IRA, that’s tax deferred. So, when you need that money later on in life, you are going to have to pay the taxes. And if taxes go up in the future, that could be a problem. So, you know, you may want to consider a Roth IRA. Now, that may not help with lowering your taxes, but it certainly would help with lowering your taxes in the future. And I’d rather you have you have no taxes to pay in the future, versus paying a little bit of taxes right now.

Steve 22:33

I like that too Lillian. And if you’d like to know some more 800-656-8616. Steve has checked in and he says I’m 65. And I’ll be retiring early next year, I’ve got about 150,000 in my Roth IRA, about 450,000 in my 401 k. Now, does it matter which one I start taking money from first? Or should I just take a little from each? Well, if we were just talking about that?

Brian Quaranta 22:57

Yeah, well look, you know, if you believe like we do, that taxes are going up in the future versus down, then your order of withdrawal would be the IRA money first, right? And this way, when that IRA money is drawn down, right, that the money that you had to pay the tax on, you have this big pot of tax-free money still growing boy $150,000 in his Roth IRA, if that’s invested correctly, he could wind up having $400,000 or $500,000 in the next 10 years, which would be all tax free. Right? So, some advisors might say, well, let’s take the Roth money first, because you don’t have to pay any taxes. I disagree with that. Because if you’re healthy, and we believe taxes are gonna go up in the future, what pot of money? Would you rather have a lot of 10 years from now, I would rather have a lot of tax-free money of 10 years from now versus taxable money. So, the order of withdrawal here would be take the 401 K money, right? And pay the taxes on it, and then maybe, maybe defer the Roth now again, I don’t know Steve’s exact situation. So that might not be the best thing for him. But speaking theoretically, that could potentially be the best way to do it.

Steve 24:04

Right? Well, again, you know, you make sense when you talk that way. And Steve, again, I would suggest you give Brian a call 800-656-8616. Let’s see, we got time for another one here. Let’s go to Kate. Kate says I’m a 64-year-old single woman trying to get rid of some of my debt. I want to take $125,000 out of my IRA to pay off my mortgage. And everyone tells me not to. What do you think?

Brian Quaranta 24:29

Well, again, this is a tough one as a fiduciary because, you know, I don’t know the rest of her situation. Right, exactly. You know, I don’t know how much is in her total 401k or her IRA? Have we’ve done that strategy before? Sure, we have. This is exactly why we offer the right track retirement review. This is what the system is all about. This is why we’ve built it because these are the questions, we hear every single week at our office. We see 25 to 30 people a week at our office, and everybody’s got some in more situations, but everybody’s situation is different. For the next 10 callers who call in take advantage of our right track retirement review. We truly are going to take the mystery out of financial planning help you map out where you are where you need to go, we will run a fee report for you. We’ll run a tax analysis we’ll show you how to build income, utilizing proven strategies that can literally help turbocharge your income in retirement. Most importantly, we take the guesswork out of financial planning make it simple, clear and easy for you to understand, which gives you a peace of mind and security go into retirement. Do your part though. This is not the time to procrastinate. start the new year off right call us today. For the next 10 calls. It’s a comprehensive financial review. We’re giving away complimentary with no obligation

Steve 25:42

800-656-8616 You’ll receive that comprehensive financial review you’ll see where you are today. But more importantly, you’ll find you have a roadmap that can help get you to where you need to be when it comes to retirement. Call right away. 800-656-8616 10 callers right now 800-656-8616 As always, we appreciate you listening and we’re going to come back again next week with new topics and questions and more all right here on the money with secure money.

Announcer 26:17

Investment Advisory services are offered through foundation investment advisors, LLC, an SEC registered investment advisor Brian Quaranta and his guests provide general information not individually targeted, personalized advice and are not liable for the use of drip information. Discuss exposure to ideas and financial vehicles should not be considered investment advice or recommendations, buy or sell any of these financial vehicles. This information should also not be considered tax or legal advice. Past performance is not a guarantee of future results. investments will fluctuate and when redeemed may be worth more or less than when originally invested. Any comments regarding safe and secure investments and guaranteed income stream for only two fixed insurance products did not refer in any way to securities or investment advisory products. Fixed insurance and annuity product guarantees are subject to the claims paying ability of the issuing company.

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