Retirement You TV: Episode 28

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Video Transcript

Cynthia De Fazio – 00:20

Welcome to retirement You TV My name is Cynthia de Fazio. I’m joined today by Brian Quaranta. He is president and founder of secure money advisors. Brian, how are you today? I’m great. How are you? It’s so good to see you again. It’s so good to see you. Again, I always look forward to our time together, because you come to the show, with such quality information for the viewing audience. You know, someone might be watching us today for the very first time, and we should talk about the importance of what the show is about, which is planning for retirement. So Brian, why is it so important to plan for retirement?

Brian Quaranta – 00:53

Yeah, well, it’s important because first off, retirement planning has changed so much. I mean, it used to be really easy. And you and I’ve said this before, many times in the show, some people spend more time planning their summer vacations than they do planning their actual retirement. But I think that’s because if you go back in history, and you look at what retirement used to be, it used to be really simple. You know, 30, 40 years ago, when you retired, you got when you retired, you got a social security check. And you got a pension check. Remember that? I mean, people used to have parties, you know, for retirement, because they actually knew when they were going to retire, you talk to anybody today you said when you retire? I don’t know. I mean, I can remember, you know, my grandfather and his friends retiring. There was retirement parties all the time. Yeah, because it ain’t Yeah, and cake and gold watches. You know, you don’t you don’t see that anymore. Do not see that anymore. And that’s because 85% of the people retiring today are not repacked, tyrael, pensions. So people just don’t know if they can afford to retire. That’s why we created the right track Retirement System. Because people don’t know whether or not they’re on the right track to retire. And it’s so it’s the right track retirement system really was built around giving people peace of mind of knowing when they could retire. And one of my favorite things to do is to show people, not through my opinion, but through black and white math, that they can retire actually a lot sooner than what they thought. And those are really special moments for us. I mean, I just got a really, really, really nice email from a client of mine. That’s been a client for over five years. And you know, he, he wrote me a nice email thanking us for spending the time that we did, and telling me that him and his wife are just over the moon, about the quality of the retirement and the fact that they’re even, they’re actually even saving money through the cash flow that we’ve built for them. And it’s just so good to hear those things, you know, year after year, and it’s, it’s really special when somebody comes in for the first time. And maybe they’re really burnt out on their career. And they’re just, they really just want to change. But for the longest time, they just felt like it wasn’t possible. And we lay out the numbers for the first time for them. And they can see that they can actually retire. And those are some emotional moments in the conference room. Because, you know, it’s a big, it’s a big day for somebody to realize that they’ve won the game, and they can actually do it. But planning is so important because we’re responsible for our own retirements. You know, you think back 30-40 years ago, when you got a pension, you didn’t have to worry about being responsible for it. You knew if you worked X amount of years for the employer that the pension was going to pay you for the rest of your life. You know, it was if you died, it was even gonna pay your spouse for the rest of your life. Yeah, but now, you know, I call it the grand experiment, because nobody knows how it’s gonna work out. The employers got rid of the the the guaranteed pensions, they replaced them with the 401k plan. I call it the yo yo retirement plan, which stands for a year on your own. Yeah, you’ve got to figure out how to do it, how are you going to build cash flow. And the problem is, I’ve been practicing that over over 21 years. And if you look at the the advice that’s been given to people for retirement, on how to build consistent monthly cash flow through something called the 4% rule, there’s a very high probability of failure with this with this rule. And it’s very scary, because, you know, people will, you know, people will get into retirement without actually figuring out whether or not going it can be done. And then 1015 years in retirement, they find out that they’re gonna be running short on money, and they gotta go back to work. I’ve met with those people. I’ve met with those people that have relied on that advice from a big box firm, that were given wrong planet advice, and the plan didn’t work out. And now they have to go back to work. And Brian ever should be in that position.

Cynthia De Fazio – 04:37

As easy as that to find a job after you’ve been retired for a while to re enter the workforce.

Brian Quaranta – 04:42

Yeah, it’s not easy. It’s actually very difficult. I mean, you know, when you get into those higher age groups, it’s more and more difficult for those individuals to find work. Very difficult. Yeah. So And not only that, but you know, are you going to have the health and the stamina and the mental psychology to be able to To go back to work at that point, I don’t know. So, but planning is so important because with planning, we can make all these bad things happen on paper. And we can stress test the portfolios under certain conditions. And when you can stress test those portfolios and look at what would happen, you know, and what we call what if scenarios, what if this happens? What if that happens? Now we can start to make very informed decisions of what to do with the money, and how to protect ourselves from those bad things happening.

Cynthia De Fazio – 05:26

Sure, sure. So Brian, we’ve talked in the past about the Morningstar report. Can we dive into that a little bit further today? What exactly is that? And how does that benefit the viewers?

Brian Quaranta – 05:36

Well, the right track Retirement System is all built around giving the individual clarity and peace of mind of whether or not they can actually retire. And if they’re on the right track, the Morningstar report is part of that system, because that really allows us to lift up the hood and look at the engine, right, and it tells us a number of different financial data points. Number one, it tells us what the overall Return of the portfolio has been, it tells us the risk associated with the portfolio, it tells us about the fees, the disclose fees, and the hidden fees, you know, there’s a lot of hidden fees. And it really just shows the strength and probability of success of that portfolio. So Morningstar is just one component. The other component that we have to it is what we call the riskalyze. Report, the riskalyze report is very powerful, because that actually identifies and quantifies the risk based on a number. So for example, risk in our riskalyze report, it goes from one to 99. And you know, just to give the viewers kind of some context here, the stock market, or s&p 500, has a risk score of 75. So if we run the riskalyze report, and we put all of your current financial positions into this software, and it quantifies and calculates based on all the data available on your positions that you own, it quantifies that risk number. So you know, you know, you know that if you’re over 75, you’re way riskier than the market, which means that the market goes up, you may make more money than the market does on average. But if the market goes down, you’re going to lose way more money. And that might be okay, for a 30 year old or 40 year old, but not a 55 or 60 year old, he just can’t have that type of risk. And what this does, is this is the data and information that people need to be able to make informed decisions, you cannot make decisions without that information. Other than that, you’re just buying something Sure. We’re not here to buy financial products. We’re here to use financial products as a solution to solving a problem. Absolutely. And there’s a difference. There’s a huge difference. Yeah, there’s a huge difference.

Cynthia De Fazio – 07:41

So let’s talk about once you run the Morningstar report, is that kind of like an X ray, if you will, of what’s really going inside? And do you give someone a printed copy of that guy?

Brian Quaranta – 07:49

That’s a great question. So they get printed copies of both, they get a printed copy of the riskalyze report, they get a printed copy of the Morningstar report, right. And this allows them to really dive as deep as they want into into their current situation. I think you gave a great example of what it’s kind of like it really is an X ray. I mean, you know, and it just exposes everything in that portfolio. I mean, it just shows you how it trends against different asset class are the same asset classes. It shows you what would happen if there was another 2007 2008. So it shows you what we call your maximum drawdown. That’s important to know. I mean, if you’re in a portfolio right now, I’ve run riskalyze reports where people have had their maximum maximum drawdown mean, if the market went down, we’re showing the maximum drawdown could be over 60%. I mean, if you’re in a portfolio like that, and you’re five years from retirement, or 10 years retirement, why would you want to know that you have a potential drawdown of over 60%? Because if a market correction comes and you take a big hit like that, that’s gonna be tough for you to recover from. And, you know, don’t let the 2000 you know, the the 2020 correction that we had at the beginning of the year in in February and March of 2020, when the Coronavirus said, don’t let that be your benchmark for how recoveries work because we got very lucky. Typically, when you have a 30 40% Mark correction, it takes four to six years to recover from something like that. We recovered in less than a year. But that’s not the norm. No, that’s not the norm

Cynthia De Fazio – 09:21

Well, Brian, this is the perfect time for us to open up the phone lines to the viewers at home for the very first time this week. Can you tell them what they can expect to receive by calling in?

Brian Quaranta – 09:29

Yeah, folks, we’ve worked very hard to provide you with a great offer today. And it started right track retirement system, that right track Retirement System, just like Cynthia had said, we’re going to give you a number of reports, we’re going to give you the riskalyze report which is going to quantify your risk number, right? It’s going to let you know how much risk are you taking. It’s also going to show you over the next six months if the market goes up how much money you can make, but it’s also going to show you that the next six months as the market goes down how much money you could potentially lose. It’s going to show you how much you’re paying in fees. It’s going quantify how you’re doing against the peers in those asset classes. Whether you’re underperforming or over performing, it’s going to show you where you stand as far as performance goes. But it’s also going to show you how risky your portfolio is, and we’re close to retirement. Remember, it’s all about mitigating risks, we just can’t take big losses like we used to in the earlier days, because we just don’t have the time to recover. the right track Retirement System is also going to help you identify five other key areas, which is your income. Remember, we cannot retire without good income, we have to guarantee our income, we have to guarantee a portion of our lifestyle, we can’t have our income at risk or potentially running out of income later on in retirement. So the right track Retirement System, again, you’ve got to do your part. It’s complimentary. no cost to you. 18883821298, folks pick up the phone 1883821298. This is not the time to kick the can down the road and procrastinate, this is the time to step forward, lean into it, pick up the phone and make the call because planning starts right now. We look forward to seeing you,

Cynthia De Fazio – 11:07

Brian, thank you so much to the viewers at home, the phone lines are now open that number to call us at 8883821298. We only have 10 spots available this week. So please don’t miss this complimentary consultation with Brian. Let him make sure that you’re on the right track for retirement again. 8883821298. When we come back, we’re going to have so much more with Brian about how to plan your perfect retirement. Please stay tuned.

Commercial Break – 11:32:00 AM

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 it’s the time 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. This is a $999 value 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 help 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 – 13:07

Welcome back to retirement you TV. My name is Cynthia de Fazio. I’m joined today by Brian Quaranta. He is president and founder of secure money advisors. Brian, before we went to the commercial break, and I was talking to the audience about planning their perfect retirement. You and I both know that retirement is not one size fits all right, and what’s perfect for someone is not going to be perfect for the person next door. So let me ask you, how do you design a customized retirement plan that’s going to fit anyone’s needs when they’re sitting in front of you?

Brian Quaranta – 13:37

Yeah, great question. Well, you know, if number one, it all starts with income, right? So the first thing we got to do is figure out what your income shortfall is. So let me give an example. What I mean by that. So let’s say that you need $70,000 a year for retirement, okay. And let’s say between your Social Security, and maybe you’re getting a pension, maybe you got $50,000 a year coming in from that. So but you need 70,000. So that means we have a $20,000 a year shortfall, because you’re only getting $50,000 from Social Security and pension. But you need 70. So we got to get that from somewhere. So it’s a $20,000 a year shortfall? Well, if you multiply that out, you know, over over over a 25, 30 year retirement and you apply in fleet inflation that you could be looking at, really a three to four and a half million dollar shortfall. Right. So you can’t look at it just on a monthly or an annual basis, right, where we’re saying it’s only a $20,000 annual shortfall. Now, it’s really like a three and a half to $4 million. You know, retirement shortfall is what it is. Now the reason it’s important to determine whether or not there’s a shortfall there is because again, there’s a whole separate set of rules or fundamentals that we want to follow if we have to generate a certain amount of income, right? It all depends on what that income need is. From there we can start to build things out. Now. This is where the customization comes in. Because some people when we talk To them will tell us that they have no desire to leave any money to their children or their family members? Well, there’s a lot of different things we can do under circumstances like that. Other people will say, look, it’s very important for me to get as much money as I can from my portfolio. But I also want to try to leave as much money to my kids as possible. Well, there’s a whole separate set of guidelines and best practices for those types of things. So, you know, when we ask those specific questions, right, tell me a little bit about how much you need for income. Is it important for you to leave money to your children? You know, or are you going to have to? Are you are you do you potentially expect to receive an inheritance? Or have to take care of a parent at all? Do you have any need to, you know, do you have any want to give to charity? These are all things that are helping us think about how are we going to customize the plan for these individuals, okay? Because you know, somebody that says, look, you know, I don’t need any income, I got plenty of money between social security and pensions, I just want to try to leave as much money to my kids as possible. Well, you think it would just be as simple as well just invest that money and hope that it grows, and you leave it to the kids. But what type of investments or is it all IRA money, because if we left the money to the kids in and just IRA money, we could be looking at half of that money going out and taxes to the IRS when the kids inherit it. So if they want to maximize what they’re leaving the kids, maybe it’s not a good idea to leave it in the traditional IRA account, or 401k, maybe it’s better that we do a Roth conversion, and then leave the kids tax free money, or maybe it’s better that we do some type of life insurance strategy to where we can leave a really large sum of money tax rate. So again, it’s through our questioning process with our with with these individuals, where the customization really starts to take place.

Cynthia De Fazio – 16:43

Okay. Brian, let me also ask you, if someone is in the viewing audience today, and they’re watching the show, obviously, cup of coffee in hand, husband and wife, how important is it for them to come in together for the meeting with you?

Brian Quaranta – 16:55

Well, look, I’ve never planned for a married couple without both of them being there. You know, very rarely do you see a married couple that one can come in and just make the old financial decisions. So but why it’s important whether whether one can make the financial decisions or not, the reason why it’s so important for both them to come in is because we were really planning for both here. I mean, you know, when we look at the scenarios, you know, I always say bad, we can make bad things happen on paper and put it in the planning process. So we make bad things happen on paper, and we can look at what would happen if she would die first, or he were to die first. You know it, you know, the nice thing about when people come to my conference room is I can kill their husband for him. We can bring everybody back to life. But but but the whole point of that exercise really is to determine, okay, if he dies, first, the income is going to go from here to here. Are you going to be okay, on that type of income? Are you going to sell the house? Right? Are you going to move out of state? What’s the plan? I’d probably move in with my kids or I’d move down south where my daughter is I’d be around the grandkids? There’s all kinds of and you have to go through those discussions. It makes it really figure out what are the best moves with the plan here?

Cynthia De Fazio – 18:08

Yeah. So and what people have said before, Brian, when they’ve come in to sit with you is that they love the fact that you ask questions that perhaps the advisor they were working with before never even asked them. And so it just goes to show it’s such a testimonial to you how well you get to know each client that comes in and they all say that you give them individual uninterrupted time. I don’t know how you do, because I know you’re so busy.

Brian Quaranta – 18:30

Yeah. Again, systems and processes. And with the tools that we’ve built out at secure money advisors has taken me over 21 years to build. You know, I mean, I’m very involved with my industry, I do a lot of coaching with financial advisors in my industry, I look at the best practices, I look at the best technology that’s available. And we bring that best technology to the table with our clients to be able to illustrate their situation in the clearest, most simplest way that we can. And you know, the tools that we use, and a lot of the compliments that will get us, you know, people will say, Well, why is nobody ever shown me this type of planning before? I would have known this. I mean, I wish I would have made it 10 years ago is what they’ll tell me. And and so and I’m always I’m always amazed by it that, you know, we’re we’re doing things that I think are so simple and basic. And it’s the way I plan my own retirement. It’s the way I planned my mom and dad’s retirement. But it was out of my own frustration of what people were getting because people were really getting nothing. What they were getting were they were getting sales brochures, and financial products that they didn’t understand, and no plan around it. Financial Planning is exactly that. It’s planning. It starts with a plan. Once we have the plan and we understand what the plan needs to do, that is when that’s only when we actually go out and buy the financial products and that’s what the right track Retirement System is all about. It’s about building the plan. Right? Once we have the plan built then we can figure out what financial product to use, and then secure money advisors. The reason why I went independent Because I wanted to come to the table and work for you not for any specific company, I didn’t want to be beholden to any company, I wanted to make sure that when I sat down with you, I could give you unbiased unbiased opinion of what’s going on your current situation and then go to the marketplace and find the best financial products for your current situation. the right track retirement system that we’ve developed for you is all about giving you the tools that you need to be confident and clear going into retirement and through retirement. And what you’re going to get to Cynthia and I were just talking about, you’re going to get the riskalyze report, which is going to identify your risk number, you’re also going to get the Morningstar report, which is going to basically be a financial X ray, it’s going to allow us to look at a number of different data points with your current financial situation. The other thing I’m going to do for you is we’re going to build out an income cash flow model for you. So you’re going to see what your income is right now. Whether or not you have an income shortfall, and if you do, what’s the best way to to maximize or fill that that shortfall. And then what we’ll do is we’ll play with some scenarios of what happens if your spouse dies first. Or if you die first and what that looks like all complimentary to you. no cost to you. It’s not very often this is only for the next 10 callers. That’s 18883821298 a complimentary right track Retirement System, folks, you’ve got to do your part. Don’t kick the can down the road. Don’t be one of those people that spend more time planning their summer vacation than they do. They’re their retirement plan. Take advantage of this opportunity. It’s 1-888-382-1298.

Cynthia De Fazio – 21:31

Brian, thank you so much to the viewers at home, the phone lines are once again now open that number to call is 888-382-1298 we have to take a very short commercial break when we come back. We’re gonna have so much more with Brian about how to plan your perfect retirement. Please stay tuned.

Commercial Break – 9:47:00 PM

As a good savor you’ve been putting away money during your working years. studies find that the biggest fear of retirees is running out of money. market volatility isn’t just a downward movement of stock prices. It’s the size and frequency of change. The more dramatic the ups and downs, the higher the volatility. This can put savers who are newly retired or a few years away from being retired at greater risk. today’s generation of retirees is not receiving traditional pensions as our parents or grandparents did. Instead, we have retirement accounts such as 401 Ks or 403 B’s. These accounts typically expose your money to market risk. The last thing you want right before retirement is to lose a portion of the money you need for income. But how do you turn these accounts into a retirement income? Is it safe to keep all your retirement money sitting in the stock market? The last thing you want is to lose a portion of the money you need for income due to market loss. By working with a financial professional, you can learn how to turn a portion of your savings into an income stream for life and income for the life of your spouse if you’re married. We all have moments in our lives when we wish we had taken action sooner. Don’t let procrastination rain on your retirement parade. Act now before it’s too late. Please call our office to set up your no cost no obligation retirement income review today.

Cynthia De Fazio – 23:13

Welcome back to retirement You TV My name is Cynthia de Fazio. I’m joined today by Brian Quaranta. He is president and founder of secure money advisors. Brian, we probably have time for only one viewer question. And I’m so sad because they’re so good. To our next show, like all viewers, I agree with that, because there’s so many we could we could just keep doing questions throughout the next week. Let’s do it. Okay. So you have a caller, her name is Sheila, she’s calling in from South Hills. And she says, Brian, I have most of my money in a traditional in a traditional IRA. I am 66 years old and I’m still working. Is it better to convert to a Roth IRA and invest? Am I able to transfer the stocks in the traditional IRA? Or do I have to sell them?

Brian Quaranta – 23:59

Yeah, good question. So first off, I mean, it all depends. Because the question would be, the money that we’re talking about here is Sheila, she’s 66 years old. So the question would be, is she going to need to generate income for that money in, let’s say, the next five years? Because typically, when we look at some type of Roth conversion, we’ve got to pay the taxes in order to convert. And the question is, are we going to convert all at once? Or are we going to convert over a period of time, but typically, what’s recommended is as after we pay the taxes on the IRA, typically, it’s recommended that we have at least five years for that account, to kind of rebuild itself a little bit to recover from the taxes that we had to pay out on it. Right. Okay. So in regards to transferring the stock, if you will, she can certainly transfer the stock, she just has to pay the taxes, on whatever, whatever we have to pay the taxes on in order to get that into a Roth IRA. So you know that that’s a simple thing to do. But the bigger question, really Here’s what’s gonna be the need of that money in the next five years because doing a conversion may not be in your best interest if you’re going to need that money in, let’s say, the next year or two.

Cynthia De Fazio – 25:09

That makes sense. So Brian, you also have a caller that came in from Pittsburgh. They want to know, Brian, I’ve heard mixed messages on this. What is your opinion about paying off the mortgage before retiring? or paying off the mortgage?

Brian Quaranta – 25:25

we’ve talked about this a lot, right? And this, this is one that I’m 100% clear on, and there should be no question of what to do here. Okay. It’s very, very simple. And this is the way you have to look at it. Let’s say your mortgage is costing you 15 $100 a month. Okay? Well ask yourself this, let’s say you, let’s say that you took, let’s say that you were investing money in a 401k plan, okay. And let’s say that you said, You know what, I’m going to stop investing the money in the 401k plan, and I’m going to redirect all that money to paying off the mortgage. So that means as soon as you pay off the mortgage, right, you now pick up 15 $100 in additional cash flow, guaranteed, guaranteed, because the minute the mortgage is gone, I now absolutely 100% have that $1500. Okay. If I don’t pay off the mortgage, and I invest the money into the stock market, we’re in a 401k plan, wherever you are, right. 401 K’s are mostly invest in the market, right? What’s the probability of me being able to recreate or generate $1500 a month from that additional money that I deposited that 401k plan or to stock market? Is it going to work? It may, it may not? How much money is it going to take? How much money is it going to take for you to generate $1500 a cash flow from your investments versus paying off the mortgage, we know we’re absolutely going to get $1500 a month in cash flow. If we pay the mortgage off. We don’t know that if we continue to invest it. But our right track retirement system can run those calculations for you and figure out what the better solution would be. But I bet you if I’m a betting man, it’s gonna be paying off. Folks, this is why we do the right track Retirement System. This is what’s been offered to you on every show. It’s very powerful. You’re going to get the riskalyze report which is going to identify your risk number, you’re going to get the the Morningstar report, which is an X ray, just like Cynthia said it’s going to really look at all aspects of your financial. But more importantly, if you’ve been wondering when the click Social Security, you’ve been thinking, I really need to get myself a pension because I don’t have one or I just can’t afford another loss in the market. The right track Retirement System is going to give you the confidence clarity you need to properly build out a written retirement plan. Folks, this is complimentary, please take advantage of it’s 1-888-382-1298 don’t kick the can down the road. Don’t procrastinate on this one. Call in. It’s 1-888-382-1298. We look forward to seeing ya.

Cynthia De Fazio – 27:51

Brian, thank you so much to the viewers at home. Thank you so much for watching. Be safe, be happy, be blessed. And we’ll see you back again next week.