Episode 154 – Ways Retirement Has Changed Over the Last 25 Years

On this week’s episode of On the Money with Secure Money, Neil Mager discusses how retirement has changed over the last 25 years, and which trends to watch out for as you plan and save for your own retirement.

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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.

Steve 00:39

We’re gonna talk about how retirement has changed over the last 20 or so years, we’re gonna get into some fees that you may not be aware of and that yes, your 401 K plan does have fees, whether you think it does or not. We’ve got some great questions. And we’ll hear from Janet Yellen, all of that coming up right here on the money, what’s secure money.

Announcer 01:01

And now on the money.

Brian Quaranta 01:04

Any good retirement plans starts with the foundation:

Announcer 01:06

asset protection, tax reduction, holistic planning,

Brian Quaranta 01:11

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

Announcer 01:15

Retirement doesn’t have to be complicated.

Brian Quaranta 01:18

You think that’s the difficult part? That’s just getting started!

Announcer 01:22

And now On the Money with Secure Money.

Steve 01:29

And welcome everybody this is on the money with secure money. I’m consumer advocate, Steve, and joining me today is Neil Mager. Neil is the Senior Advisor at Secure Money Advisors, filling in for probably a sleepy Brian Quaranta. Hi Neil, how are you?

Neil Mager 01:44

Hey, Steve, how are you today?

Steve 01:46

I’m good. Thanks. What’s new?

Neil Mager 01:49

Oh, not too much. Just enjoying the start of some better weather here in Pittsburgh. And I think Brian is probably still sleeping when he got two little ones at home. You know?

Steve 01:58

Exactly. That’s what I mean.

Neil Mager 02:00

And I have twins, so I experienced that firsthand.

Steve 02:04

Yeah. So, how old are your twins?

Neil Mager 02:06

My twins actually turned nine this week.

Steve 02:09

Oh, wow. They’re all grown up.

Neil Mager 02:13

My wife and I definitely missed those days of, you know, being woken up, you know, because they’re becoming more independent. You know, I don’t get such a greeting anymore when I get home from work. So, you know, life happens fast, doesn’t it?

Steve 02:26

It really does. It really does. Folks, I’m gonna give you a phone number just to get things going here. 800-656-8616 we’re talking about in this one? Yeah, retirement really has changed. I mean, I think back, you know, my mom retired in I want to say 1980s. Seven. And it was different than even then. I mean, it was just 30 years ago.

Neil Mager 02:49

Yeah, for sure. I mean, we talk a lot about this at our educational events. This is not your father’s retirement, the days of the 40-year career with the same company, those are gone, in many cases. And what we’re seeing, especially at our office is the pensions are gone. And so that that’s where things become really complicated. Anytime I see somebody that comes into the office that has a really nice pension, what they typically have is a retirement date. Unfortunately, only about 15% of people that are coming into the office, have a pension anymore. And the people that what we call the yo yo retirement, you’re on your own. They’re the ones coming in that, you know they’re responsible for their own saving their own finances, their own income, the cash flow in retirement. And they really, Steve, they have no idea when they’re going to actually be able to retire.

Steve 03:44

Well, the current situation doesn’t help that.

Neil Mager 03:47

It doesn’t help, right? I mean, when you’re talking about the increase in the cost of goods, the increase in market volatility. Yeah, I could see why there certainly be a lot of concern somebody who’s nearing retirement. But the facts of the matter are, I mean, we’re on this retirement that we’re left to kind of create and navigate on our own. And if you read any retirement book, they’ll tell you, the ones with the most guaranteed income are the happiest in retirement. So, the goal at secure money advisors and we talk about the five key areas, you’ll probably hear me referenced that a lot here on the radio today. But the five key areas that we talked about really creating retirement plan, always, always start with income. We got to create an income strategy and income plan to be able to make people feel comfortable, give them the peace of mind that they’re able to retire and they’re not gonna worry about market conditions or anything else. So, number one, first and foremost, you have to create a cash flow distribution plan. And you know, Steve, what we typically see is a lot of these folks that are coming in without the Pension. You know, they’ve been on investment plan throughout their working years. And even though they’re going into retirement, they haven’t shifted from that investment plan to what we call the retirement plan. And that’s where we think a lot of the mistakes are being made.

Steve 05:16

Okay. Well, that makes sense. I think one of the concerns that people have not only running out of money, but I think also just the fact that we’re living so much longer these days. I mean, it’s just not uncommon to see somebody in their mid-90s. Looking, you know, I ran into a guy outside a restaurant Saturday morning. He was 88 years old; I would have thought he was 60.

Neil Mager 05:38

Yeah, it’s really neat, isn’t it? Yeah, the average life expectancy for a 65-year-old is 19 years, and many of us will live another 25 to 30 years. I mean, you know, God bless on my grandfather passed away this year, he was 92 years old. Sure. You know, what we’re seeing that more and more often, we’re living longer. And that’s good news. Right? That gives us more opportunities. But the bad news is, we’re going to have to figure out how to make sure that retirement last that 25 to 30 years.

Steve 06:09

Well, that goes back to the number one on the five keys income, we got to make sure that income lasts all the way through retirement, and it’s got to be ever increasing just to try to keep up with inflation. And the good news is, that’s what you do.

Neil Mager 06:22

Absolutely. Steven, if you think about, you know, that income. I mean, think about people that retired. You know, let’s use your mother, for example. You said 1987? Retired? Yeah, I think so. I mean, think about it, if she got a pension in 1987. And that pension amount never changed. Yeah. What’s the true value of that income? In 2022? It’s a lot different, right? It’s not a lot. It’s not a lot. I’ve taken calls like that before. You know, it’s people that call in and say, Well, I retired a long, long time ago. And when I retired, my pension was pretty good. It’s $500 a month. You know, that’s not too good anymore.

Neil Mager 06:59

Not so good.

Steve 06:59

No, that’s a great little supplement a great little, you know-

Neil Mager 07:03

yes. So, it becomes a challenge. So, when we talk about the five key areas, the number one is always starts with income. Right? Yeah. And then we have to understand taxes. And the expectation is tax rates go up, you know, how, how is our plan impacted? What can we do today, to help put us in a better position for in the future? Number three is investments. And when we talk about income, you know, it goes hand in hand with investments, because we always say the purpose of your money determines the placement of your money, of course, and so if we know how much income you’re going to need, we’re going to know how to invest your money properly. So, you don’t experience something like a lot of people have never heard of the sequence of returns risk.

Steve 07:49

Oh, that’s about that one, right. Now, that becomes real critical, doesn’t it?

Neil Mager 07:53

Oh, my gosh, can you imagine retiring at the peak of the market, like at the end of 2021. And now all of a sudden, you’re pulling money out, and every time you pull money out of a risk investment, you’re locking in and compounding the loss.

Steve 08:07

So, what can we do to avoid that, Neil, what are we well, how can we avoid that?

Neil Mager 08:11

Well, we need to build out a true income plan. And that’s what a lot of people are lacking. And you know, it’s secure money advisors, we use a very simple bucketing approach.

Steve 08:20

Let’s invite folks to call get on your calendar, come on in and just have that exact very conversation.

Neil Mager 08:24

Yeah, we keep a few openings on our calendar each week for listeners, and we’d love to hear from folks who have seen the recent market volatility and are concerned about it, you have the opportunity right now to sit down and have a conversation with a fiduciary financial advisor who can guide you and possibly help improve your situation for the next 10 callers who have $200,000 saved for retirement, we will perform a complimentary easy to understand financial review of your portfolio. The review will indicate if you’re in need of a comprehensive financial plan. Steve, I invite callers to call us pick up the phone right now. Don’t procrastinate. This is a great opportunity complimentary, Right Track Financial Review.

Steve 09:03

800-656-8616 You’re gonna get that comprehensive financial review that Neil just talked about, you’re gonna see Yep, this is where I am today. But what’s important is you get that roadmap. It’s a guide that will help get you to where you need to be when it comes to retirement. 800-656-8616 again, 800-656-8616

Neil Mager 09:23

Hey, when we come back, we’re gonna go over the changes that have occurred with retirement over the past 20 years.

Announcer 09:33

Hurricanes, tornadoes, and fire. These are serious situations we plan in advance for the volatility of the market can be just as devastating. When a market correction does occur. There are strategies you can employ to bounce back. Call Brian Quaranta and his team at secure money advisors at 800-656-8616 or text keyword BrianQ to 800 656 86 16 We’ve made it easy, folks. All you have to do is call or text the keyword BrianQ to 800-656-8616.

Steve 10:14

We are back on the money with secure money. Neil Mager is here in for Brian Quaranta. Today, Neil, Senior Advisor at secure money, advisors, a fiduciary and so much more. Right track your retirement. I’m gonna mention Brian’s book is all right. Really Right Tack Your Retirement, a simple planning strategy to help you reduce risk, build income and provide peace of mind. That’s the brand-new book that Brian just released. And, you know, if you come in, you’ll be able to get a copy he’ll even sign one for you. Wouldn’t he Neil? I would think he would.

Neil Mager 10:44

Yeah, of course, when you come in as the key word. Yeah, right. You come into the office; we will hand you a copy of the book.

Steve 10:51

All right, that’s well, and again, when you when you talk about that title really goes to what we’re talking about here, changes in retirement changes that we have to address in order to get to and through retirement. And healthcare certainly is near the top of the list. Certainly. Medicare, we can talk about Medicare. But I mean, Medicare is great. And you’ve got Medicare specialists on board with you. You know, and but again, it’s not everything. It’s a great program. Don’t get me wrong, but there are limitations.

Neil Mager 11:23

Yeah, absolutely. I mean, obviously, you need supplemental insurance to help pay doctor’s bills, prescriptions cost dental expenses. I mean, if you just think about health care in general, you know, another major factor that that we think about all the time that almost every person that comes into our office thinks about is what about long term care? You know, I mean, so many people have directly been impacted by mom, dad, brothers Sister, you know, going into long term care, and having to pay for the cost of care and seeing how that, you know, impacted their life savings. You know, almost everybody talks about, you know, how do I get long term care, insurance? And it’s pretty difficult, and it doesn’t apply to everybody. But yeah, so obviously, healthcare in general, is something that when you think about, you know, all the areas of retirement planning something that needs to be a major focus?

Steve 12:18

Sure. Well, and again, that, you know, like I said, you’ve got folks on board who can help with Medicare? If that’s if that’s a question or if they need some help, sort of, you can guide them along that trail. And speaking of health, we do ultimately have to take care of ourselves, not only financially, but physically. So those old habits, those old habits die hard, unfortunately, for many, they just die.

Neil Mager 12:41

Yeah, I mean, that’s it. I mean, retirement is really the time when all the bad habits of your youth actually come into play, right? Of course, you think about, you know, I think people nowadays, typically eat a little bit different, right? When it’s hard to get a 75-year-old, 85-year-old to kind of change, you know, things that they’ve done for the past 55-60 years. For I know, as far as you know, we always talk, you know, my wife’s always all over her parents about drinking water, you know, to me, you know, that’s something that I don’t even think about, because I always have water in my hand. Sure, you know, her parents don’t enjoy drinking water. And, you know, so you know, just very, very simple things that we don’t think about, you know, that can kind of create challenges and problems, and maybe more expense ends up really coming into play as we get older.

Steve 13:35

Of course, and well, I mean, look at look at the rock and rollers. I mean, you know, some of them are, you know, defying all odds, but others, you know, they just, I mean, I think of Tom Pettys, it’s like what the heck, right?

Neil Mager 13:46

Right. Yeah, yeah, totally agree.

Steve 13:50

So, and again, I think it’s important to have that plan for the future. And in other words, just because you retired, that it’s not just today. I mean, this goes on for decades, in theory, and we’ve got to know, think about that. As we get toward the slow go, and then the no go years, what are we going to do? But more importantly, what are we going to do right now?

Neil Mager 14:09

Yeah, I think that’s important. And, you know, a lot of people think that age dictates that they need to retire, right? You start to say, well, I’m 62, I need to retire. I’m 65. It’s time for me to retire. And that’s not always the case with folks. You know, maybe, maybe you’re behind on your savings. Maybe you don’t have a lot of hobbies, you know, have you ever thought about if you are going to retire? How are you going to occupy your time? And I think that’s something that’s pretty important that a lot of people don’t really look at is, you know, what do you do each and every day because keep in mind when you retire every day, Saturday and Sunday. And Saturday and Sunday gives us a lot of free time to some people that can be great to some people not as favorable but now keep in mind also, as every day Saturday and Sunday. I don’t know about you, Steve but when you spend the most money Yeah, Saturdays and Sundays, Saturdays and Sundays, you have a lot of opportunity to go golfing with your friends meet up with friends or family for dinner, travel. So, you have to keep that in place. And that’s why we’re so focused on the income part of the planet secure money advisors is really developing that cashflow. So, when you no longer going to trade your time for money, you still going to want a paycheck. And we got to make sure that we’re able to provide the paycheck for you.

Steve 15:28

Absolutely. And you know, when you talk about a paycheck, the money, of course, makes retirement a lot more pleasant. But there’s more to it than that. We just alluded to that when we talk about what are you going to do? How are you going to keep your mind active? How are you going to keep your body active? Those are the things as well, that I mean, just, you know, loneliness can happen.

Neil Mager 15:48

Sure, absolutely. And I see that as well with, especially with single people, you know, it seems like single people, it’s more favorable for them to work a little bit longer. Because at the end of the day, the people that they work with often have become not only friends, but really family to them. Sure, you know, so, Steve, have you gotten into pickleball?

Steve 16:08

I have not yet but my wife is nudging me that way. Oh,

Neil Mager 16:11

gosh, you know, everywhere I go and talk to people come into the office. That’s all they talk about is how much pickleball they’re playing. And I went in, but I just I don’t know where to play.

Steve 16:24

But you got to go to a retirement community. That’s where it’s big. It’s big. Let’s go ahead and invite folks to call and then we’ll look we’ll pick up the conversation.

Neil Mager 16:31

Yeah, our Right Track Financial Review, we keep a few openings each and every week. For our listeners, we love to hear from you folks, especially the ones that have seen recent market volatility and are concerned about it. You have the opportunity right now to sit down and have a conversation with a fiduciary financial advisor who can guide you and possibly help improve your situation. Keep in mind our strategies are often used by folks with over 1 million saved for retirement. But we will not turn you away if you’re serious about retirement planning. This complimentary Right Track Financial Review. So, for the next 10 callers who have at least $200,000 saved for retirement, we will perform a complimentary easy to understand financial review of your portfolio. And that review will indicate if you are in need of a comprehensive financial plan. Steve complimentary Right Track Financial Review for the next 10 callers.

Steve 17:20

Sounds great, Neil, again, 10 callers right now. 800-656-8616 great opportunity for you to get a financial roadmap put together a practical financial review. If you need that second opinion. Yes, now’s the time to call 800-656-8616 10 callers you will find that you have well, you’ll find out where you are today. But more importantly, you’ll have a roadmap to help get you to where you need to be when it comes to retirement 800-656-8616 10 callers right now 800-656-8616

Neil Mager 17:54

We know getting to retirement takes plenty of planning. Part of that plan must include expenses that are sometimes overlooked. When we come back, we’ll outline some specific costs that can and should be avoided.

Announcer 18:12

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.

Announcer 18:29

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

Steve 18:48

And we are back on the money with secure money and Neil Mager is in for Brian Quaranta today Neil is a fiduciary independent, he’s a senior advisor at secure money advisors and again that website securemoneyadvisors.com Neal it’s been a great show. I mean, I know we’re already in our last segment, but man some good information today.

Neil Mager 19:06

Yeah, time flies when you’re having fun. So, seems like we’re just kind of you and I just talking at a picnic or something.

Steve 19:09

Yeah, well, yeah.

Neil Mager 19:10

So fun. Yeah.

Steve 19:13

Bring me another beer. Thank you.

Neil Mager 19:17

You got it, my friend.

Steve 19:19

Oh, you know what, let’s talk about inflation, because that’s a happy topic. We know we’re feeling it. We’re feeling it, you know, a lot and it doesn’t seem to be going away. And so, Janet Yellen, the Treasury Secretary, the US Treasury, Secretary of Treasury, she says, well, maybe I misjudged this whole inflation thing

Janet Yellen 19:39

When I said that inflation would be transitory. What I was not anticipating was a scenario in which we would end up contending with multiple variants of COVID, I was not envisioning impacts on food and energy prices we’ve seen from Russia’s invasion of Ukraine. So, as chair Powell indicated himself. Both of us probably could have used a better term than transitory.

Steve 20:12

Well, yes, looking back, perhaps they could have. Because I don’t think anybody was buying that from the beginning. Do you? I wasn’t.

Neil Mager 20:20

No, no, we’re buying it. You know, I feel like I have to dollar cost average with my gas.

Steve 20:26

Yes, I know. I know. Last year. Yeah.

Neil Mager 20:30

Every time I drive to the office, I gotta fill up because it goes up 10 cents every day.

Steve 20:34

Well, I mean, like, yeah, I hit the magic number last week. 100 bucks.

Neil Mager 20:38

Wow. Yeah, yeah, it’s terrible. It’s not only the gas pump. No, no, it’s travel. It’s hotels. It’s food.

Steve 20:47

Oh, food is really scary, you know, just there’s no end in sight, it seems

Neil Mager 20:52

There’s no end in sight. And you know who this really impacts? Steve?

Steve 20:55


Neil Mager 20:56

Retirees. Yes, of course, because you know, they’re on more of a fixed income. So that’s where that becomes a real challenge. And that’s why, you know, you really make sure that you have a true retirement plan based starting with cash flow distribution, but also make sure that you have enough growth in your portfolio to experience challenges like this and hard times like this. Sure. Because if you if you keep all your money, you know, sitting in a bank account or under your mattress, you know, the challenge is, does that cause you to end up running out of money? You know, and the good the only good news, as interest rates increase some safe money becomes better. Right, right now, there’s their safe money options available at a fixed rate of three and a half 4%. You know, so that’s pretty good. As far as far as where we’ve been in a long while, yeah. But that’s the real challenge is really for retirees, the cost of goods significantly going up? I mean, it’s impacted all of us, but especially people on a fixed income.

Steve 21:57

Oh, of course, 800-656-8616. Are you hearing from a lot of your clients in terms of how they’re being impacted? And how do you address that in terms of dealing with the inflation and making sure that their income keeps up with that? That’s your challenge, isn’t it?

Neil Mager 22:14

Yeah, it’s certainly our challenge and in our reviews have become more consistent. As far as you know, we’re really making sure everybody’s coming in frequently right now, because we want to talk about a number of different things, we want to talk about continuing to give them the cashflow that they need, especially as the cost of goods has gone up significantly, we want to continue to talk to them about market volatility. You know, as the market kind of goes through this, this period, we want to make sure that, you know, their comfort level. But you know, first and foremost that secure money advisors, we start with a cash flow distribution plan. And so, our clients are positioned in a way that the money that they have at market risk is long term money, it’s really designed for 10, 15, 20 plus years to be used. Because we know at secure money advisors, when you’re going to invest in the market, it has to be long term money, you never want to kind of have it as short-term use. So, it’s definitely something that that’s top of mind right now. And we’re trying our best to just make sure that our clients are comfortable. And you know, I think the way that we plan for the most part, they are comfortable. And that’s important to us.

Steve 23:25

Okay, yeah, well, I’m again, I think that’s important to everybody. 800-656-8616. If you’d like to sit down with Neil and have the conversation, find out how you’re doing and Alright, let’s get well, before we run out of time, I want to jump into I want to get one question in today, I’m gonna start with Matthew. Matthew says my wife hasn’t worked outside the home in years, what’s the best way for us to put some retirement money away for her since she doesn’t have a 401k? or anything like

Neil Mager 23:51

that? Yeah, man, you know, the best way would be, basically to consider a spousal IRA, whether you choose to do a traditional IRA or a Roth IRA, she does have the ability as you work to be able to contribute to that. She’s under the age of 50, she’d be able to put in $6,000 per year, after the age of 50, she would be eligible for $7,000 a year.

Steve 24:16

Wow, that’s, that’s a pretty cool thing to be able to do that with the spousal IRA and not everyone is aware of that, I don’t think

Neil Mager 24:22

Not everyone’s aware of that. Not everyone’s aware that, you know, if you’re, if your spouse was a homemaker, that you have the ability to collect social security income off of your spouse, you know, people come in all the time, they’ll say, Well, I’m gonna get, you know, 20 $100 a month from Social Security, but my spouse is, you know, she’s not eligible because she didn’t have enough working quarters. Well, good news is the fact that she would be able to get social security based on your work record. So, you know, things like that just kind of the coaching is really why you want to work with a financial planner.

Steve 24:56

Well, on that note, we’re gonna have to wrap up the show Neil. So, let’s invite folks to call one last time today.

Neil Mager 25:02

Yes, Steve, our right check financial review, we go over the five key areas of retirement planning, income, taxes, investments, health care, Legacy planning. We keep a few openings on our calendar each and every week. Totally complimentary for folks like you, who are nearing retirement have concerns about market volatility, have concerns about cash flow distribution, and we invite you in right now to give us a call. So, for the next 10 callers, a complimentary Right Track Financial Review, focused on those five key areas of retirement planning.

Steve 25:33

Hey, folks, this is it. last opportunity today to give us a call. Come on in sit down with Neil and get that plan going 800-656-8616 You heard Neil 10 callers right now, we’ll get that comprehensive financial review seeing where you are today. But more importantly, it’s that roadmap, it’s the guide that can help get you to where you need to be 800-656-8616 again, 800-656-8616 Neil, as always, a pleasure to do these shows and the information is so important for folks to hear.

Neil Mager 26:05

Yeah, my pleasure, Steve, I hope people got a lot of information about it and we did invite them to call and learn more.

Steve 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 usage of information discussed. 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 streams refer only to 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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