On the Money with Secure Money: Episode 81

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Video Transcript

Cynthia de Fazio 00:20

And welcome to On The Money with Secure Money. My name is Cynthia De Fazio. I’m joined today by Brian Quaranta. He is founder and president of secure money advisors. Brian, how are you?


Brian Quaranta 00:30

I’m doing great. Cynthia, always good to see you.


Cynthia de Fazio 00:32

It’s always good to see you. I always look forward to the fresh content that we deliver to the viewers at home. And I’m really excited about today’s episode specifically, on one plant that we do you and I often talk about this, how important it is to stay healthy to take care of ourselves. We like to work out we’d like to eat well. Yes. And that actually goes hand in hand with wealth. So today we’re going to talk about health and wealth. Yeah, I love that. Yes. Let me ask you, what is a financial checkup? What does that mean to someone?


Brian Quaranta 01:04

Well, almost like you would go to the doctor and have an annual physical right that the financial checkup is very, very similar. I mean, for us, we have a very standard process that we go through with each person each year for our annual review, because things change, you know, people change jobs, they receive inheritances, they, they might have beneficiary updates they need to do, they might have changes to their will they might need to make. And this is why I always make sure that we’re talking about the five key areas. Because when you know what the five key areas are of retirement planning, where you’ve got income taxes, investments, health care and legacy planning, that allows you to always do a good financial checkup. Because each of those areas, there’s different things that need to be handled, for example, income, we may need to increase income this year, we may need to reduce income. Now, people don’t realize this. Well, why would someone reduce income? Well, that’s because we have in retirement, there’s three different phases of retirement, there’s the go-go years, yeah, there’s the slow-go years. And then there’s the no-go years, and in a no-go years, people aren’t spending as much money, believe it or not, they actually wind up reducing their income, they’re just not using or they don’t go out anymore and go out to eat. They become homebodies at that point. So anyway, these financial checkups are just as important as an annual health checkup.


Cynthia de Fazio 02:19

Absolutely. Kind of staying in line, if you will, with the health checkup. Yeah. How important is it to have a second opinion?


Brian Quaranta 02:25

Very important. And remember, you can’t get a second opinion from the person that gave you the first opinion. Right? It’s second opinions, I think are very important that you know, and I learned this Personally, myself, and in my own life. You know, as I was building secure money advisors out, and we were growing the company, I was using a tax accountant, and an attorney to help with all the business structure with the taxes, and so on and so forth. And we were smaller at the time. But as we as the company grew, and we added more and more team members, and we got bigger as a company, I really felt that I wasn’t getting the best advice. And I felt that I was bringing a lot of the ideas to the table. This is exactly what people tell me about their advisors is that they’re the ones that are bringing the ideas to the table, right? They’re the ones saying, hey, well, what about Roth conversions? Or what about ways to reduce our taxes? Or how are we going to handle our RMDs? And they’re not getting this proactive advice. And I wasn’t getting that either when I was working with this, this specific accountant and attorney. And so, I had to go get a second opinion. And I said, You know what, let me just go talk to some other people and find out maybe things that I’m just not aware of? Or maybe that I don’t know, right, and you don’t know what you don’t know. And so, what I did, I realized that there was things that we should have been doing that weren’t being advised. And that made me make a switch. And a lot of times people will find that when they go get a second opinion. They’re going wow, I didn’t know that financial planning could be this intensive and this in depth, but most importantly, simple. And people feel that when they come on board with us that every i is dotted, every T is crossed.


Cynthia de Fazio 04:00

Absolutely. So, a very thorough examination. Yes, yes. So important. It is. Yep. So, Brian, let me ask you a question. Obviously, when you’re talking about health and wealth, we talk a lot about life insurance in life, if you will, because you want to insure what’s important to you. Where do you use life insurance in your practice? And how does that fit in with overall wealth for someone?


Brian Quaranta 04:21

Yeah, well, life insurance is a great tool for wealth transfer. See, most people look at life insurance as a tool that’s being used when you’re younger, maybe, you know, let’s take my brother, for example. My brother’s, you know, you know, in his early 40s, he’s got three beautiful children. You know, he’s got a painting company in New Jersey. And you know, if something happens to my brother, he has not had enough time to accumulate a large sum of money that if he were to die being the sole breadwinner of the family, that his family would be able to continue on. And so, the way that you protect somebody like that is you buy a life insurance policy, so there would be a large sum of money to pay in case of an untimely death. But what people don’t realize in retirement planning is that life insurance becomes a wealth transfer tool. Here’s why. I’ll give you a good example. So, I have a client that just started to have to take his RMDs. Okay, now, he’s only been a client for the past couple of years. So, I didn’t get in early enough to be able to do some of the tax planning would have would have liked to like transferring money from taxable money to tax free. But he came to me, and he said, you know, the RMDs, he said, What strategies do we have in place? I said, well, one of the strategies I want to talk to you about is, rather than just taking the RMD, okay, and paying the taxes and it just reinvest in it, and then you die, and you got to pay taxes again on it. I said, have you given to charity at all? And he says, I do I give to my church every year. And I said, Well, we can use a charitable distribution. So, the IRS allows you to give any bit some or all of your RMD to charity, and you don’t have to pay taxes on that portion that you give. But the other portion, I said, Well, we could give a little bit to your charity, but let’s take the other portion. And we combined large life insurance policy. So, we bought about a $2 million life insurance policy with that RMD. And now when he dies, his daughter is not only going to get all of his money that’s in his retirement accounts, but she’ll also get a $2 million life insurance policy, all tax free, all tax free. Wow. Absolutely. And so, life insurance, if you look at really big estates out there, life insurance is the number one tool that they use to make sure that wealth passes from generation to generation to generation because of the tax free benefit of it.


Cynthia de Fazio 06:37

Yeah, we get that question all the time. We do call in from the show. And they’re saying, Brian, can you use life insurance to build tax free cash value? So, you’re saying yes, you can, it’s a great idea.


Brian Quaranta 06:47

You can use it, you can use it in a number of ways you can transfer a death benefit, tax free, but you can also use it if you wanted to. There’s an internal component to life insurance, where you can build a very large sum of money and withdraw it tax free. We call that a super Roth IRA. Right? And because you can put any amount of money into it. And a lot of people just don’t understand the ins and outs of life insurance. And a lot of times when people don’t understand things in there, or they’re confused on it, a confused mind does nothing. So, our job is to take these financial products are available in the marketplace and show people how to use them so they can maximize their financial situation.


Cynthia de Fazio 07:26

Well, Brian, I know there’s a very special offer that you’re going to present to our viewers at home today. Let’s talk about what that is, before we open the phone lines. Yeah, Cynthia,


Brian Quaranta 07:33

you know, I’ve worked really hard to build this right track Retirement System. And it was really built on the fact that most people when they would come see me would always say, Brian, are we on the right track? Are we doing the right things? And folks, I want you to know, if you’re on the right track, if you weren’t on the right track. When would you want to know that the right track Retirement System will truly help you determine whether or not you’re doing the right thing. So, for the next 10 callers, who call in right now, we are going to give you a complimentary no obligation, right track retirement review, where we’ll go over the five key areas that I was talking to Cynthia about income, taxes, investments, health care and legacy planning. All you’ve got to do is pick up the phone and call us today. 1-888-382-1298.


Cynthia de Fazio 08:17

Brian, thank you so much to the viewers at home, the phone number to call is on your screen, that number is 888-382-1298. We know you have a lot of questions for Brian about how to plan your perfect stress-free retirement, he has the answers for you, all you have to do is take advantage of calling in today, to 888-382-1298, we’re gonna take a very short commercial break. But when we come back, we’re gonna keep going hand in hand with health and wealth. And we’re going to talk about stepping on that dreaded scale, stay tuned.


Brian Quaranta 08:49

So, everybody can tell you how to invest your money. There’s not a lot of people out there and a lot of firms that can teach you how to use your money. Most people also tell you that they’re scared. And the reason they’re scared is because they’re afraid of running out of money.


Neil Major 09:03

The last thing you want to do is have a really good job and you’re in your 60s retire and be looking for work again in their late 70s.


Brian Quaranta 09:11

The average person might say, well, a good portfolio would be a good mix of stocks, bonds and mutual funds. A good portfolio is all designed around the five key areas income, taxes, investments, health care and legacy planning.


Neil Major 09:25

Because we’re not just product pickers here, what we do best here as we build retirement plans,


Brian Quaranta 09:31

nine out of 10 people when they walk through the door would ask us, we just want to know if we’re on the right track. And I always say if you’re not on the right track, when would be a good time to know it. Probably now,


Neil Major 09:41

people you know can actually see a vision once we start to really build out their plan.


Brian Quaranta 09:47

This is about you. If you’re not getting what you need, and you feel that when you walk out of the advisors office, it’s time to get a second opinion. And you can’t get a second opinion from the person that gave you that for What’s the difference at secure money advisors. As a fiduciary firm, we help you manage the risk, build the income, and give you the retirement


Cynthia de Fazio 10:17

And welcome back to On the Money with Secure Money. My name is Cynthia De Fazio and I’m joined today by Brian Quaranta. He is founder and president of Secure Money Advisors. Brian, part of the health checkup, okay, every year we go to the doctor, it’s part of the physical after they call your name, they pull you back and they tell you, what, step on the scale. Right? And for me, I’m always like, Okay, can I take my socks off? Because I know is adding like 10 pounds I’m, I’m confident that’s what it is, right? So, let’s talk a little bit about not only stepping on the scale, but in retirement specifically, let’s talk a little bit about what can be weighing someone down? Would that be a debt, perhaps?


Brian Quaranta 10:55

it is exactly that it’s debt. It’s unnecessary subscriptions, right? I mean, you could have, you know, Netflix and Hulu, and Amazon and Amazon Prime and Paramount. And I mean, we can go on and on. I mean, you know, I started using and I’m not promoting this company by any means. But I started using an app called Truebill. And the reason I used it was because, you know, I randomly will subscribe to apps that pop up, you know, financial app, and a lot of times you know, I miss the mark to unsubscribe. Well, Truebill that it is an absolutely amazing app, you want to talk about something that keeps you know, my fitness pal, how you got to track your, you can track your, what you’re eating every day and track your calories. Look at true bill is kind of like the, the my fitness pal of finances right, it tracks everything for you. And it will send you alerts, and it will say, hey, Amazon, or let’s say Netflix, this just happened to me, Netflix just increased their price by 20%, right? Or, or I had one where Beachbody just increased their price by 100% Beachbody brought their app price from $10 to $20. Now, you might not notice a $10 jump I mean, right? You got all these bills coming out. But when you see that from true Bill as Wow, that’s 100% increase. So, these are ways that you can make sure that you’re not way getting weighed down, right. And these are ways that you can monitor with a little bit of help with this, with this with this specific app called Truebill. But the important thing in retirement planning is we don’t want to be weighed down by debt, right? We don’t want to be weighed down by that I get a lot of questions people will ask, you know, what should I do? You know, we’re three years away from retirement, we still have a mortgage left, what should I do? Now I give a little bit of unconventional advice here. And I’ll explain to you why. And this is not right for everybody. But you know, there’s a lot of times when I’ve evaluated somebody’s portfolio where I made the recommendation is to quit contributing to their 401k and pay the home off. Now here’s why. So, let’s say you’ve got a $2,000 a month mortgage or a $3,000 a month mortgage? Well, you’ll have to ask ourselves, if we got three years of contributions left in the 401k. Ask yourself how much money is it going to take? How many contributions is it going to take for you to generate $3,000 a month in guaranteed income. Whereas if I take those contributions, and I pay that mortgage off, and I no longer have a $3,000 monthly payment? I’m guaranteed to pick that up as cashflow. Whereas I if I just keep investing in the 401k. And the markets go down and cooperate, am I going to be able to get that same $3,000 a month that I could have gotten that I just paid the debt off? Right. So, when we pay debts off, we’re guaranteed to pick that up in additional cashflow. Versus if we keep investing in stock accounts. We’re not sure if we’re going to be able to actually replace or get that same amount of income versus paying the debt off, you’re guaranteed to pick it up.


Cynthia de Fazio 13:48

Okay. If you are paying off debt, Brian, what do you recommend that people start with? What should be that first thing that they cut out? Yeah, credit


Brian Quaranta 13:56

cards, credit cards, any high interest rate stuff, right? I mean, if your mortgage is at 2%, like some people’s are, you may look at that and say, well, there’s no reason to pay that off early. But if you have high interest rates on credit cards and things along those lines, you want to start there, that’s the best place to start and get rid of things that you’re not using. I mean, we all get enticed these days with subscriptions, right all the time, you might not know things that it’s a good just every month to evaluate what’s going out and make sure that there’s nothing new or something that sneaked in, that you forgot about. It’s just a good habit to do a little bit of a checkup on a monthly basis,


Cynthia de Fazio 14:31

Brian, for your new patients, if you will, coming in because we’re gonna stay with how when you’re looking at someone’s risk and diversification, are they ever in line especially for today’s environment?


Brian Quaranta 14:44

No. And I’ll tell you why. Because diversification in retirement is much different than diversification in your accumulation years, and I want people to really understand the difference. You got two phases of retirement. You have the accumulation phase, where you’re growing your money. This typically happens when you’re younger. You can be more aggressive stuff. Because if it goes up and down, it really doesn’t matter because you have time on your side. But I think about things in buckets, right, I approach planning in buckets. And I think about diversification as different buckets of money doing different things and having different jobs. So, let’s talk about those three buckets, we’ve got bucket number one, which we call our bank money. bucket number two is called our pension money. And bucket number three is called our growth money. And the reason why we want to diversify amongst those three different buckets is because there’s a job for each of those buckets to do. The bank money is there in case of an emergency comes up, the pension money is there to provide you with guaranteed monthly income, so that you have your lifestyle protected, most important thing because if the growth bucket doesn’t cooperate, right, it doesn’t matter, because we’ve got time for it to grow. But that growth bucket is what’s going to help us keep up with inflation, rising costs, rising interest rates, higher taxes, you name it.


Cynthia de Fazio 15:58

Wow. Excellent. Well, Brian, let me also ask you a question. Obviously, part of the whole staying healthy process would be taking our vitamins drinking plenty of water. What type of diagnosis do you give to people in financial wellness? How do they stay? Well, what’s the best thing for them to do?


Brian Quaranta 16:15

Well, the best thing for them to do is to make sure that they’re getting an annual checkup, right, that’s the most important thing. They’re making sure that they’re following the basic fundamentals of planning, which most people don’t know what they are, Cynthia, they don’t understand that there are five key areas, you have to make sure that you’re taking care of in the income area. And when I say taken care of an income, most people are building income plans around risk portfolios, which means they’re trying to pull money out of accounts that are in the stock market. And that’s a very dangerous strategy. Because if the stock market doesn’t cooperate, they may not be able to continue to get that income that they need. Imagine needing $40,000 or $50,000 a year in income. And because the market didn’t cooperate, and your account balance has gone down, you realize, or maybe your advisor realizes that, hey, if we keep taking this money out every single year, we’re gonna run out of money. So now all of a sudden, you have to shut that that income spigot off. And now you might only be living off of Social Security. And now you have to take a hit on your income and your income is gonna go down. Number two is making sure that Uncle Sam doesn’t get a large portion of the money that you’ve grown. And unfortunately for a lot of people, as their money grows and gets bigger over time, and they want to take withdrawals out, they have to pay taxes on those withdrawals, not having the right investment mix, right, not making sure that they’re protected a health event were to happen. And the most important one is when the good Lord decides to take you home. Right? And none of us are getting out of here alive. We want to make sure that your family your charities become the largest beneficiaries and not the IRS.


Cynthia de Fazio 17:45

Well, Brian, we I know you have a very special offer to present to the viewers at home, I’d love to talk a little bit more in detail about what that is before we open the phone lines.


Brian Quaranta 17:53

Yeah, our Right Track Retirement System. Cynthia was really built to help people get on the right track, right? Maybe we should call it the right track financial health system, I don’t know. But the right track Retirement System is really designed to keep you financially healthy. It’s going to teach you all the things that you need to know about in building out a real retirement strategy. So many people have an investment strategy. And for those of you that are approaching retirement or in retirement, I want to show you what a real retirement plan looks like a real written plan. So, for the next 10 callers who call in right now, we are going to give you a complimentary no obligation appointment to go over our right track Retirement System with you. All you got to do to get that appointment is call 1-888-382-1298. We’ll sit down and we’ll have a strategy session together, right, there’s no obligation there’s no pressure, I know that coming into a financial advisor’s office could probably be an intimidating process. Process. But I want my personal guarantee to you is that there is no pressure when you come in to Secure Money Advisors, so call 1-888-382-1298 and schedule your Right Track Retirement Review today.


Cynthia de Fazio 19:07

Brian, thank you so much to the viewers at home, the phone number to call is on your screen. That number is 888-382-1298. We know that you have a lot of questions for Brian about how to plan your perfect stress-free retirement. He has the answers for you. All you have to do is call in today 888-382-1298. We’re going to take a very short commercial break. But when we come back, we’re going to talk a little bit more in depth about health and wealth and the fact that people are living longer today. What does that mean to you? Stay tuned.


Announcer 19:39

How confident are you in your current financial plan? Do you know with certainty how the recent market volatility will affect your future hopes and dreams? How much are you paying in taxes? And how much are you losing to unnecessary high fees? You didn’t work to save this money so that you could spend your time worried in retirement. Now is the time Want to take charge of your finances so you can feel confident about your future call in during the next 30 minutes of today’s show only. To set up an absolutely complimentary no obligation, full blown financial review that will result in your own customized written plan that we’re giving away complimentary to the first 10 people who respond. We’ll start with a full-blown analysis of what you already have, by running a report to untangle how much you are currently paying in fees, how you’re allocated for risk, and what it’s costing to work with your current advisor. Next, we’ll identify your goals. Where do you see yourself in the next five years? Where do you want to go? And who do you hope to go there with is your current financial plan set up to get you there without mishap? Let’s design a roadmap to create a financial plan you can follow with confidence, get the piece that so many people are missing from their retirement. Find out how having a written plan can make a difference to your retirement dreams. Call now to schedule your complimentary no obligation full blown financial review today.


Cynthia de Fazio 21:14

And welcome back to on the money with secure money. My name is Cynthia De Fazio. I’m joined today by Brian Quaranta. He is founder and president of secure money advisors. Brian a great show we’re having today talking about health and wealth and how they go hand in hand. And obviously we’ve talked in the past about the fact that people are living longer. And of course, there’s going to be a need for insurance, which you spoke about before as well. Let’s talk a little bit about some things that other people should be insuring, besides their health, if you will, yeah.


Brian Quaranta 21:44

Well, health is a very important thing to insure, your life is very important to insure. But the other thing that’s very important to ensure is your income. You see, we insure our cars, we insure our homes, we insure our health, but we never take the time to ensure the most important thing we’re going to need and that’s your monthly income. And you can do that today. Through the use of an annuity annuities are great for ensuring income now they’re not suitable for everybody and not everybody should get into one. But for a lot of people today, the only way to create guaranteed income for yourself and retirement that you don’t ever have to worry about what the stock market is doing is through the use of an annuity now think about it as it fiduciary advisor, I am held to the highest standard, why at everything out there would I choose an annuity. Now most people might have heard the fact that annuities are bad, and you shouldn’t buy them, and your money gets locked up and you can’t take your money out. I promise you these things are not 100% True there misled on these, there are bad annuities, there are annuities that you would never want to go into. But a lot of the annuities out there today that a fiduciary firm like mine would use are going to give you flexibility, they’re going to give you income, but more importantly ensuring that income and sharing the income for you. And then if you die ensuring the income for your spouse, and if your spouse dies, any balance that’s left in the account pays out to the family. Wow. So, we always want to protect the client’s lifestyle. The most important thing is to protect the lifestyle. Once we protect the lifestyle, then we can take risk with any amount of money that’s leftover.


Cynthia de Fazio 23:20

Okay. All right. Thank you, Brian. Tying in with health and wealth, a lot of people can go through stages of insomnia. So, what are you finding would be keeping people up at night, in your opinion, going into the avenue of planning for retirement or without a plan? Yeah,


Brian Quaranta 23:34

well, market volatility keeps people up. You know, I hear that a lot. I mean, it doesn’t, it doesn’t keep our clients up. And that’s because again, we teach them a way to plan so that when there is market volatility, they know that their retirement is protected. And that’s key. You want to put your head on the pillow at night and sleep well. You don’t want to be waking up turning the news on and see absolute pandemonium on Wall Street and be panicking or being on a Viking cruise somewhere and turn on the TV and see absolute pandemonium on Wall Street and panic. And that’s not the lifestyle you want. You want to be visiting your grandkids, you want to be visiting your children you want to be traveling, not worried about what’s going on with your investments. So, protecting the lifestyle is very, very important.


Cynthia de Fazio 24:16

Absolutely. Brian, if someone is 10 years away from retirement, what should they be doing today?


Brian Quaranta 24:23

Yeah, well, the first thing they should be doing is looking at their expenses, right, making sure that all debts are starting to be paid down, making sure that they’re they have a good emergency cash reserve built. I typically like to have at least 24 months of cash reserves. So, the easiest way to do that is if you’ve got, you know, $2,000 a month in bills, you would just times that by 24 to get your total amount, right. So it’s very important that people have that emergency cash reserve going to retirement, make sure that there’s no debt and you want to make sure as you get closer to retirement, that your risk is in line Because the worst thing that can happen when you’re 10 years from retirement is to take a big market correction to where you may have to delay your retirement a few years, that’s the last thing you want to see happen. And then when you get even closer to retirement five years out three years out, that’s where you really want to make sure that no matter what happens in the market, you’re still going to be able to retire when you want to retire. Now, here’s what I found from doing this for over 20 years. Most people because they don’t have a written plan. They don’t know whether or not they can retire, because nobody’s helped them solve that problem. See, most people come in with their pile of stuff, right? They’ve got investment accounts all over the place. They’ve got mutual funds, they have stocks, but nobody’s teaching them how to utilize that money. Your money needs to work for you. It’s a tool, it’s a utility. But see most investment firms and I know this, because I started at the big box firms, they teach you how to invest people’s money, they don’t teach you how to give them strategies of how to use it, protect it, pass it on, be tax efficient, they’re just showing you how to buy some investments. That’s it. That’s okay, when you’re younger, but when you get older, your needs change. Absolutely. And think about your doctors, they change as you get older, right? You need different specialists as you get older. And so, it’s the same thing with financial planning.


Cynthia de Fazio 26:14

Well, that tees me up to the next question, because obviously, we know we go to the doctor once a year for our physical how often should people be seeing their financial advisor?


Brian Quaranta 26:22

Yeah, well, we recommend that you see your advisor annually, but you know, at secure money advisors, we give our clients access to unlimited financial planning appointments throughout the course of the year at no additional cost. And usually, a year is enough because we monitor and we’re in contact with our clients on a weekly basis. And we do that through a number of different videos that I do and things along those lines. But a good solid annual review once a year is good enough, especially when you’re doing the type of approach that we’re doing. You know, because at the end of the day, you want to build a plan that once it’s built there’s not a whole lot of moving around that needs to happen right because you’re gonna be out enjoying your life.


Cynthia de Fazio 27:01

Absolutely. Well, Brian, less than a minute left of the show this week. Any final words of wisdom you want to get? Yeah, folks,


Brian Quaranta 27:06

I really want to see you get on the right track. Take advantage of our record a track retirement system for the next 10 callers who call in right now. We are going to give you this opportunity to come in, how often do you get to come in and sit down with a fiduciary firm at no cost? schedule the appointment today. This is not a time to procrastinate, don’t kick the can down the road. I know it can be a fearful thing to come into an advisor’s office but I promise you not at our office you’ll feel very welcomed and you’ll learn a lot when you come in. All you got to do to schedule that appointment is dial 1-888-382-1298 Again, that’s 1-888-382-1298


Cynthia de Fazio 27:41

Brian, thank you so much to the viewers at home. Thank you for spending time with us today on On the Money with Secure Money. Be safe, be happy be blessed. We will see you back one week from today. Take care now.