On this week’s episode of On the Money with Secure Money, Brian Quaranta covers tax planning and the five key areas of financial planning to help ensure your money lasts throughout retirement.

To see a full schedule of our radio airtimes, please click here.

Radio Show Transcript

Announcer 00:00

These 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

Planning for retirement with an eye on taxes and fees is a big, big job. And on today’s show, we’re gonna give you some tips to help you make sure your money lasts all the way through retirement when we come back with On the Money with Secure Money.

Announcer 00:56

And now On the Money.

Brian Quaranta 00:58

Any good retirement plans starts with the foundation.

Announcer 01:02

Asset protection, tax reduction, holistic planning,

Brian Quaranta 01:05

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.

Announcer 01:17

And now On the Money with Secure Money.

Steve 01:23

Hey, welcome everybody, On the Money with Secure Money. That’s the show, Brian Quaranta is here. Brian is President and CEO of secure money advisors. He’s a fiduciary he’s an independent got a great team of folks. And of course, you can find them at secure moneyadvisors.com and so much more. Hi, Brian. How’s things today?

Brian Quaranta 01:42

Steve, how are you? I’m doing great. Happy holidays. Merry Christmas. Yes, whatever they say anymore these days?

Steve 01:47

Well, I don’t know, whatever is acceptable, right? Yeah, well, I’m just happy.

Brian Quaranta 01:50

I think Merry Christmas is perfectly acceptable.

Steve 01:53

Yeah, me too. Oh, and I’m all for it. And you know, you bring up a good point here talking about, you know, saving for retirement is a big job. We all know that. And it’s a little intimidating at times. And I don’t think anybody would deny that. But one of the things as we start to put that savings plan together, and then we get with, you know, to that, you know, that financial redzone, 510 years before retirement, we start to look at things a little differently, and say, okay, so I know I’m making money here, but what am I what is at what cost? And that’s where you come in, because you can tell us those fees that we may not see.

Brian Quaranta 02:25

Well, you know, this is part of the reason why we develop the right track Retirement System. And it’s why we offer the opportunity for all the listeners to be able to schedule a time to come in to go through these things. Because there’s five key areas when it comes to building a retirement plan. If you got a pen, write these down, number one, and most importantly, as your income, you’ve got to learn how to start making your money work for you. Most people know how to accumulate money, which is kind of the easy part. But what they don’t know how to do is start turning it into a paycheck. Because when you retire, your paychecks gonna stop. But bills, taxes and all the things that you want to do, that’s not going to stop. So, we have to replace the paycheck. And we’re gonna have to do that with the money that you’ve accumulated. Number two, and most importantly, is taxes. Right? So, the reason why we want to make sure that we handle taxes is because paying less taxes in retirement is a benefit to you. Let’s say you need $1,000 A month out of your retirement account, and you’re in a 20% tax bracket. That means you’re only going to net $800 after you pay taxes. If tax rates go up, which if you ask most people, do you think taxes are going up or down in the future? What do you think most people think Steve? Up, of course. Up? Of course, that’s right. So, if tax rates go to 30%, that same $1,000 withdrawal is only going to net you $700 a month now, now add our inflation rate in there, which is over 6%. This year, you got a real purchasing power problem. So, taxes. Number three is your investments, the investment strategies, and accumulation strategies that you’ve used to get to retirement are not the same strategies you’re going to use through retirement to generate the cash flow, you need the game changes and our right track Retirement System, we’ll show you why it changes and how you need to make the changes put yourself in a more favorable position. Number four is a health care plan. Right? So the proper health insurance, proper Medicare supplement, when to sign up for Medicare. And then of course your estate planning. And retirement planning has changed so much, Steve, you know, if you look back, you know, 3040 years ago, I mean, retirement was actually pretty simple. It was not a big job. As we’re talking about here. I didn’t have to worry about fees and expense ratios and mutual fund transactions because when you retired, you got something called a pension. Remember that?

Steve 04:38

Well, I wish I did, but way after my time for them for the most part,

Brian Quaranta 04:44

right. But this is why my grandparents I think they went to two or three retirement parties a year. You don’t ever see retirement parties. My parents don’t go to retirement parties, because none of their friends know when they can retire. And this is the problem that you see is that most people today are not getting pensions. So what they have though is, is a retirement plan an employer sponsored retirement plan called a 401 K, or a 403. B, or a 457 plan, depending on what type of work they’ve done. Fast forward to today. You know, the problem with retirement is the fact that we have to generate income from our retirement accounts. And this is why understanding how fees break down are so important. And Steve, you got everything from expense ratios, to mutual fund transaction fees, to management fees to 12 B, one fees,

Steve 05:34

what’s a 12 b one fee is that something I need to be aware of,

Brian Quaranta 05:38

you know, 12 b1 fee, the best way I describe it, it’s kind of a marketing expense. It’s one of those fees that nobody knows how to read them pain. But if you look deep in a mutual fund prospectus, you’re going to see what we call 12, b1 fees. And this is typically what a mutual fund charges you for the marketing that they do have their own funds, right. And there’s some other things that are built into that. But you know, but management fees are what you might be paying to a funds investment advisor for managing funds in a portfolio, then you got mutual fund transaction fees, this is what a broker is going to charge you to buy or sell a mutual fund expense ratios you’re going to see across the board. This is going to apply to all mutual funds, indexes, exchange traded funds, there’s always an expense ratio and their operating expense ratio. So, there’s quite a bit and you should be aware of it because remember fees, reduce your gains and compound your losses.

Steve 06:31

Right. But I mean, that’s one of the things that you offer, with the with the consultation that you offer, you know, no cost, no obligation, folks will come in, and you’ll just do that portfolio X ray, and let folks see what fees they’re actually paying. And then maybe you can help them, and you know, minimize those fees.

Brian Quaranta 06:48

And fees is just one part of the analysis that we do. You know, we built the right track retirement system to help people go through five key areas, income taxes, investments, health care, and your estate planning. So, for the next 10 callers, who call in right now, we’re going to create a one page financial review, that’s going to indicate whether or not you’re even in need of a full blown Financial Review. It’s we call it our right track retirement analysis. Now I’ve seen other people charge up to $1,000 or more for similar features or offers. But we’re going to give this review away at no cost, no obligation. If you’re one of the next 10 callers. We’re literally going to take the mystery out of financial planning helping you map out where you are and where you need to go. We’re also going to run a fee report just like Steve had mentioned, we’re gonna help you untangle what it’s costing you to work with your current planner or advisor. And we’re going to help you also perform a tax analysis to reveal how much you could possibly reduce in taxes will even run a customized income plan utilizing proven strategies and techniques, which literally can turbocharge your retirement income, and take the worry out of living too long in retirement. In short, we take all the guesswork out of financial planning. So again, for the next 10 callers. That’s a comprehensive financial review. We’re giving away complimentary with no obligation, your right track retirement view, schedule it today, call us now.

Steve 08:06

800-656-8616 That’s the number to call, folks. It’s an opportunity to sit down with Brian and his team at secure money advisors and, and really get that financial roadmap put together understand what your plan is and what it can be. It gets complicated. Brian understands he can break it down make it clear and a lot easier to understand. Here’s your chance to get a true practical financial review. So, if you’re listening, give us a call 800-656-8616 You heard Brian 10 callers right now we’ll get that comprehensive financial review. You’ll see where you are today. But most importantly, you’ll find that you now have a roadmap that can help get you to where you need to be, so you got nothing to lose call right away. 800-656-8616 again 800-656-8616 quick break for us. We’re coming back though we will continue our conversation right here on the money with secure money and Brian Quaranta.

Brian Quaranta 09:00

Some surprising statistics about how Americans are using their 401 K’s How much do you really know about your 401k You might be surprised what your money is doing while you work. Well, we come right back with On the Money with Secure Money

Announcer 09:18

do you ever feel like you’re fighting for financial knowledge? Don’t let bad advice be a punch in the gut your retirement and take advantage of a complimentary no cost no obligation consultation with a local trusted financial coach. Call 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 09:55

We are back on the money with secure money and Brian Quaranta I’m consumer advocate Steve, Brian, of course President CEO of secure money advisors been helping folks for years getting to and through retirement. And so, I like this, you’ve made the statement, you might be surprised what your money is doing while you work. And I think it’s important to think about that, because that’s really the reason why we’re saving, and why we’re working, and saving is to make sure that we get the most on the back side. But, you know, 401k is a great savings tool, I get it. But there may be some things we don’t know that we need to know, and how to perhaps make our 401k even a little bit better.

Brian Quaranta 10:32

Yeah, we do, because it is our primary source of retirement right now, as I said, in the first segment, no more pensions, at least for 85 to 90% of the people, you know, most people that come to our office, you know, the number one question they have is, you know, are we doing the right things? Are we on the right track? You know, are we going to have enough money for retirement? You know, a lot of people tell me, their biggest fear is running out of money before they die. You know, a lot of people will tell me that, you know, they don’t have a pension, and they need to create an income stream that’s going to last need to last the rest of their life, people will say that, you know, they’re at a point in their life where they can’t be subjected to another big market downturn, because they just don’t have the time to recover. So, knowing the 401k and how it works and what it’s doing while you work, here’s one to know, the average person only holds a few funds. So mutual funds and ETFs are responsible for the vast majority of assets held in 401k accounts. But the data from Vanguard, most people know who Vanguard is most at savers tend to use only a handful of funds to hold their wealth. And on average, participants were offered around 17 to 18 funds within their 401k. But on average, they only invested about two to three of them. So, you know, one of the things that we’ve known for a long time is that the disadvantage of 401k is that you’re very limited to your investment options. And PBS public broadcasting station did a great report on the retirement crisis. And one of the things that they examine was the 401 K plans. And what they had found is that most 401 K plans typically have maybe 20 options at most. And really, they’re subpar at best. And this is why when you turn 59 and a half, it’s a really big day. And the reason is, is because the IRS and Congress made it possible for you to now do something absolutely amazing. With your 401 K plan while you’re still working. It’s called an in-service withdrawal. This is not a rollover, it’s an in-service withdrawal. An in-service withdrawal allows you to actually move your money out of your 401k no taxes, no penalties before you retire. And the reason is, is because Congress realized that people need to be able to set themselves up for retirement responsibly. And a lot of times when you look at 401 K plans, if somebody is five years out from retirement, they may not have the best options, or enough options to get the client the proper structure they need within their portfolio. So, they allow this in service withdrawal, which is a really big advantage. Most people don’t know they’re even entitled to it. But it doesn’t close your 401k. And matter of fact, you know, I recently did a, a to in service withdrawals last week, from people from that work for major corporations down in Pittsburgh, and we were able to go in do an in-service withdrawal, no taxes, no penalties, their 401 K plan, even though they’re going to work for another year to their 401 K plan is going to remain open. So that means we’re going to zero out the balance, they’re still going to be able to make their contributions, they’re still going to get their company matching. But now we were able to now set that plan up more appropriately for retirement. And now we have the entire market to use versus only 20 options. So some great advantages there still Sure,

Steve 13:59

Absolutely. It’s nice to be able to have your insight to take a look at I mean, and again, I could come in and say here’s my 401k How come what can we do?

Brian Quaranta 14:08

Yeah, well, this is what the right track Retirement System is all about is it’s looking at where you are and where you need to go. We invested probably five years ago in a very powerful software that allows us to analyze your all of your current positions. So how nice would it be to know whether or not you’re in the best positions and you’re optimized? So, our software actually is all data driven, which is really nice, because I think when you take the opinion out of financial planning, and you purely look at the facts, you look at the data, making the decision to improve your situation is very simple, because you’re basing it off of facts, not opinions. And so that’s what our software does. So, we actually do this analysis for you. We enter in all of your current positions, and we’re able to look at the risk of those positions have the return that you’re getting the fees that you’re Pain, and more importantly, a a, a, a ratio that we’re looking for risk versus return. And that’s a really important one to know. Because if you’re taking a lot of risk and you’re not getting enough in return, we’re going to call that an inefficient portfolio. So, I don’t want to take a whole lot of risk. But I want to get a lot of return, right? This is reducing our risk and maximizing our gains. And through technology, we’re able to do that today. And the software allows us to do that with a few clicks of a button. And we can even look at optimizing what you currently have. And this is what our right track Retirement System is all built off of it is giving you the clarity and insight you need to know whether or not you’re doing the right things, whether or not you own the right investments are you going to be able to generate the income you need are you going to be in a position to where you’re paying the least amount of taxes possible. But imagine coming into secure money advisors and taking advantage of our right track system, which is such an easy process to do, all you got to do is pick up the phone and call us and schedule a time to come in. You don’t have to worry about what to ask us because we know what to ask you. We know how to give you the clarity that you need to move into retirement or through retirement with peace of mind. So again, for the next 10 callers who call in right now, we’re going to create a one-page financial review, that’s going to indicate whether you’re in need of a full-blown financial plan. It’s our right track retirement analysis. Now I’ve seen other people charge up to $1,000 or more for similar features or offers. But we’re going to do this review at no cost and no obligation. It truly is going to take the mystery out of financial planning, helping you map out where you are and where you need to go. We’ll run a free report, we’re on a tax analysis for you. So, we’ll even run a customized income plan usually utilizing proven strategies and techniques which could literally turbocharged your retirement income. In short, we’re going to take all the guesswork out of financial planning. So again, for the next 10 callers with a complimentary right track retirement review, we’re giving away complimentary with no obligation.

Steve 17:02

Sounds fantastic. Take advantage of the offer, folks, it’s a good one, to be able to get that financial roadmap put together to put you on the right track to retirement. That’s what Brian and his team at secure money advisors can do for you. It’s a chance for you to get that true practical Financial Review. There’s no cost, there’s no obligation, make that phone call, put it in motion 800-656-8616 10 callers right now get that comprehensive financial review, plus all the extras that Brian just talked about. You walk out the door with a roadmap that can help get you to where you need to be when it comes to retirement. 800-656-8616 again, 800-656-8616 Let’s take a quick break, come back and continue our conversation on the money with secure money and Brian Quaranta.

Brian Quaranta 17:47

Learning from our mistakes is good but learning how to avoid them is even better. When we come back. We’re going to show you some things retirees wish they knew before they got there, we come right back with on the money with secure money.

Announcer 18:05

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 18:41

And we are back on Retirement You Radio increasing your financial IQ with Brian Q, Brian Quaranta, of course is here, is here I’m consumer advocate Steve and this has been a really fun show Brian and we’ve covered so much ground, but we’re not done yet. And, and I so I think it’s important that we just continue down this list. And I know we touched on that a little bit earlier about beneficiary designations as part of estate planning but again, having the incorrect transfer on death payable on death the Tod pod designations. Boy, that’s a critical piece of the puzzle too. And it’s so easy to do it beforehand and impossible to do after something happens.

Brian Quaranta 19:18

Yeah, if you have a trust or estate plan, fidelity recommends double checking your transfer on death Tod and payable on death pod designations to ensure that they will match. Look, I don’t think people really realize how important the titling of your accounts are. I mean, the titling near your accounts could mean the difference between probate and no probate and who wants to go through probate that no that’s a process right. So yes, checking your account titling, Steve, are very, very, very important. And you know it’s just again part of the process, but with thorough financial planning, these are the things you’re going to be talking about.

Steve 20:06

Right. And again, that estate planning, and I know we’ve done a show on this in the past about estate planning and how important it is, and boy, that’s so true. You know, and you talk about, you know, just getting that estate in order to make sure that you can get to where you need to be and not have any surprises when something happens. I’ll tell you; I just went through something with, you know, my wife ended up in the hospital, and we knew that she was going to go in for surgery. And so, we finally got off our butts and put the estate thing plan together. And I mean, we shouldn’t let it come to that. It shouldn’t be done. Good horse.

Brian Quaranta 20:38

No. And you know what, and take Steve’s advice, don’t do it, you know, during a crisis situation like that, because guess who else did it in a crisis situation? I did. Right? I had I had an emergency a personal emergency that I had to go in for. And this was probably I don’t know, maybe 10 years ago. Yeah. And I didn’t have any of my estate planning documents done. Right. And I’ve been doing this for 21 years. It’s the shoemaker thing, right? Yeah, it’s the cobbler’s kids got no shoes, right. But it’s so important, because really, there’s just some basic documents, you know, financial powers of attorneys living wills, basic will, right, a lot of people don’t really need a trust. And depending on your situation, you are most likely your beneficiary documents are going to get the job done. Sure. That’s not for everybody. But yes, basic legal documents are very important. And they are part of that for those five key areas that we talked about, right. The fifth area that we talked about, and retirement planning here at secure money advisors is the legacy planning piece. And this is where we talk about how do we get this money to transfer to your loved ones, without the IRS getting a large portion of it, or getting caught up in probate or getting taken from nursing homes? These are the processes that we go through to help you solve, identify and solve these types of problems.

Steve 21:59

Sure. So, one of the things that you know, there’s the fire movement, that financial independence, retire early movement, if you will. But and I understand people want to retire early, they work real hard, they want to they want to have a fun retirement. But that can lead to problems. candidate,

Brian Quaranta 22:15

whatever. Yeah, retiring early has two main disadvantages. First, the early. The earlier, you’re tired that obviously the less time you have to save for retirement. And to your point that that fire movement, right, financially independent retire early.

Steve 22:30

Well, and again. Absolutely. And, you know, I know, we’re kind of running out of time here again, already, holy cow. But let’s talk about medical expenses. Because you got to plan for those, even though you don’t want to the numbers for 2021 are startling.

Brian Quaranta 22:44

Yeah. I mean, you know, not planning for medical expenses. I mean, according to Fidelity, a 65-year-old opposite gender couple retiring this year 2021, can expect to spend $300,000, in health care and medical expenses throughout retirement. Wow, those are big numbers. Those are big numbers. And again, this is why it’s so important to sit down with a fiduciary planner that’s truly held to a standard of providing you with a plan because these are the exact discussions that you need to be having of how you’re going to handle not only the cash flow that you need to maintain your lifestyle, but how are we going to handle the cash flow that we need for medical expenses and things along those lines. Now, for single retirees in 2021, the estimate is $157,000. For women, and $143,000 for men now here in Pittsburgh, you can understand why everywhere you look, there’s a new medical facility being built. That’s how much money is in this per person, right?

Steve 23:43

That’s right. Oh, yeah. Well, you make a good point, because that’s very true, right? They

Brian Quaranta 23:47

know the numbers. They know, they know what’s coming down the pipeline, they wouldn’t be spending these millions, hundreds of millions of dollars building out these facilities. If they didn’t know, this was the opportunity of a lifetime. Look, we have the largest wave of baby boomers coming into retirement and through retirement and we have an aging population. It’s just the reality of the situation. And there’s a lot of money and in medicine right now. And these numbers prove it.

Steve 24:11

Right. Absolutely. So again, just to look at the big takeaway here is what we just have to know what we’re looking for and what we want in retirement, right. And the best way to do that is to sit down with you.

Brian Quaranta 24:20

Yeah, look, retirement really is about planning folks. It’s about understanding that you’re going to be going from an accumulation phase to a distribution phase. And that distribution phase has five key areas that you have to focus on its income, taxes, investments, health care and legacy planning. If you make sure that you have every i dotted every T crossed and those specific areas, you will have a solid retirement plan, your retirement plan will be on track. If you want to find out if your retirements on track, call us schedule an appointment and schedule a right track retirement meeting with us so that we can help you determine whether or not you’re on the right track and we can give you advice On the best moves to make to make sure that your retirement gives you peace of mind, happiness, and the life that you deserve. So but you’ve got to do your part, you’ve got to pick up the phone, you’ve got to call us for the next 10 callers at the right track retirement meaning no cost, no obligation, it truly is going to take the mystery out of financial planning. We’re really going to take the guesswork out of it all. But you have to do your part. The next 10 callers that’s a complimentary financial review, no cost, no obligation.

Steve 25:26

800-656-8616 you heard Brian, you’re gonna get that comprehensive financial review. There’s no cost, there’s no obligation, and you’re gonna see where you are today. Yes, of course. But more importantly, you’ll find that you’ve got a roadmap, a guide that’s going to help get you to where you need to be when it comes to retirement. Brian and the team at secure money advisors are there to help that happen. help make that happen for you. 800-656-8616 again, 800-656-8616 Brian, as always, a pleasure and what a great, just a ton of great information today.

Brian Quaranta 26:02

Steve, what a great show, folks, we look forward to seeing you again next week. Keep your retirement on track. Right here on Retirement You Radio.

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

Are You on the Right Track for Retirement?

Let’s Talk for 15 Minutes