On the Money Transcript

Hosts: Denise Kovach, CFP®, AIF® and Joe Bert, CFP®, AIF®

Well, good morning everybody! Welcome to another edition of On The Money with the Certified Financial Group here on News 96.5 WDBO. Joe Bert and Denise Kovach are here answering your questions at 844-220-0965. Good morning everyone!


Good morning!


Well, not too bad. How are you today?


Good! Good. Just good.


Well, you know, kind of a rainy, gloomy kind of day it looks like, but it’s good.


Well, you know what gloomy days in October mean.


Tell me.


There’s a cold front — there’s a cool front.


Ah, you got it.


Not in Florida.


Well, well, well — no, no, what I hear is a rumor. Next weekend, we could be lows in the 50s, high in the upper 70s during the day.


Really? So that’s great motorcycle riding weather, so I’m very excited about that and I know you are, too, Denise. I’ll take the gloomy weekend if that means beautiful next week, that’s how I’m —


But Joe, why are we near at 9:07 on a Saturday morning?


Denise and I are here to answer any questions that might be on your mind regarding your personal finances. As we say, we go through life trying some of this, trying some of that, and wake up at 55 years old, look across the breakfast table at Loretta and say, Loretta, you know, we’re going to have to retire one day and where’s the money going to come from? The paychecks will stop, we have Social Security, but how do we continue this wonderful lifestyle that we’ve enjoyed for the past 25 years of marriage? Kids are gone, kids are married, and it’s just you and me, honey!


For the next 30 years.


That’s right, so what are we going to do? How do we turn that savings that have in the IRAs, and 401(k)s, and the stuff that we’ve accumulated into a lifetime of continuing income? That’s what Denise and I do, every day, day in and day out, for our many clients doing it for a fee. But on Saturday morning, we are here absolutely free. We’re here to answer any questions that might be on your mind regarding your personal finances, as it might revolve around questions that you have about stocks, and mutual funds, and bonds, and real estate, and long-term healthcare, and IRAs, 401(k)s, annuities, life insurance, reverse mortgages, all that and more. We are here to take your call. The good news for you, the lines are absolutely wide open. So if you want to pick up the phone — you don’t even have to give us your real name; you can pretend you’re Loretta, or Daphne, or Jack, or Sophia, or whatever it might be. Just kind of, you don’t have to use your real name.


I like Sophia.




Sophia Lorenz.


I love Sophia Lorenz.


Sophia Lorenz. Get me started.


Okay, so we’re here to take those calls, and all you have to do is pick up and dial these magic numbers.


844-220-0965. Very simple: 844-220-0965. And we have the magic of technology in the text form as well, 21232. We ask you to just keep to about 160 characters, that’s all we can see on our screen, so we don’t want your question to get cut off. We know a lot of people give their life story in those text — 160 characters, that’s it, 21232. Denise Kovach is going to kick off today’s conversation: Mistakes or common mistakes with inherited IRA.


Well, yeah. Inherited IRAs are also known as stretch IRAs, and they’re specifically designed for non-spouse beneficiaries; however, on occasion, it would be appropriate for a spouse — okay, if she needed the money prior to being age 59 and a half. However, if inherited IRAs are not set up and funded correctly, there could be irreversible and very costly consequences, and I’m going to talk about a few of them.


So, let’s draw for our listeners that might not be familiar.




So, Mom passed away, Dad’s gone. Mom passed and Mom had an IRA, and now she wants to leave the IRA to Junior. That’s an inherited IRA.


That’s an inherited IRA.


Where are the problems?


One of the problems is incorrect account titling, because they must be set up — believe it or not — with a deceased name on the account title.


Ah, so I can’t put Junior’s name on the account? Or I can put Junior here, but I have to have Mom’s name on it, too.


Well, you can’t — some financial institutions will do that, but that causes confusion, too. Okay, because Junior might forget about it being an inherited IRA, make a contribution to it, and I’m going to talk about that.


So you keep it separate <?>.




So, title it in the name of John Doe (Deceased February 1, 2017) IRA for the Benefit of Jane Doe. That’s how it has to be, unfortunately. Ineligible rollovers: You can’t go to the bank, cash out the IRA, get a check, and take it and roll it into an inherited IRA.


Yeah, so people think, oh, I’ve got that 60-day rule. I’m just going to cash it in 60 days and put it into my IRA.


Oh no! You’ll be putting it into your checking account, because it’s considered a distribution.


Not good.


No, not good at all, because all of the funds are going to be considered withdrawn and very taxable. You can’t contribute to it. So, back to the titling.




If you forget that that’s a beneficiary IRA or an inherited IRA and you contribute to it, well, all of it’s going to be taxable. When you need to take your mandatory distributions, they must begin by December 31st of the year after death. They’re going to be typically based on your life expectancy. That’s if you were the named beneficiary or the trust that was named beneficiary saw through to you. Those are a few things that you really have to look at, and there’s more.


So if you’re not careful, you can blow the whole deal.


Absolutely! And that could be very expensive.


People do it. We see it all the time.


Well, that’s why you need to call us..


You’ve got it!




Alright, Kyle, we’ve got a call here.


<Inaudible> 844-220-0965. If you’ve got a question for the panel, again, 844-220-0965. You can dial us up like Walter in Titusville has this morning. Walter, go ahead. You’re on with the Certified Financial Group here on WDBO.


Good morning, Walter.


Hey, how are you?


How are y’all doing this morning?


Good! What’s up?


Listen, I’ve got a quick question on 401(k). I’m still working and I’m collecting a pension right now, and I’m curious if I should — I’ve got my 401(k) maxed out to what the company matches me.




But I have extra money coming in from a pension, a previous pension, and I don’t — should I put more money in my 401(k) at work or I also have two mutual fund Roth IRAs through T. Rowe Price.




So your question is, you’ve got some extra cash flow that’s just kind of <Inaudible> there, and you want to build up some more. How old are you?


Right, I’m 53.


53, okay, the good news for you, Walter, is you can put $24,000 into your 401(k).




Right? And you’re only putting what the company is matching which is probably, what, 3% of your income, maybe 5%?


It’s 8% on — 50% on the 8%.


<Background Noise> so the 8% of your income is probably not $24,000.


Oh, no.


Okay, alright.


And then what they do now, they froze our pension previously at work. So what they do is they dump — I think it’s like, I want to say it’s like $4,000 a year in the 401 to cushion the frozen pension portion.


Okay, well you are eligible to put $24,000 per year into your 401(k), and that’s what I would do. That’s the target that I would use. What do you think, Denise?


Well, unless Walter — if you have any debt. Do you have any debt?


Just house payment, that’s it.


Okay, okay, just wanted to make sure there. Definitely, I’d take advantage of putting some more funds into your 401(k), like Joe said. You can contribute up to 24,000, so if you’ve got discretionary income, pop that up, definitely.


So I mean, I was just curious about the Roth IRA. I’ve had them since like ’85, and I do monthly deposits in that, but I mean, you know, not near as much as I probably should be doing.


Well, what’s your — are you married?




Okay, what’s your income between you and your wife? Does your wife work outside the home?


No. I’m a little over 100 a year.


Okay. Forget the Roths.




You get no tax deduction, okay? And you can use the Roth with the idea that when you put the money in there, you’re going to get it out tax free, right? I mean, that’s why <Background Noise>. There is no guarantee that the rules in the law will not change. You’re laughing! I’ve been through it, Denise has been through it. We’ve seen tax law changes. One day you think you have this, next day the rules have changed and you thought what you had is not going to be the same.




I’m concerned that somewhere down the road, they’re going to change the rules on Roths. Now, that doesn’t mean that the money coming out will be taxable. But what will happen, I suspect, is they’re going to make it what’s called means testing. So if you’re in a high enough tax bracket, then what you’re after is you want to get the tax deductions. You can either claim tax deductions of $24,000 a year by putting it in your 401(k), and that’s exactly how it is. Now the question is, the allocation on your 401(k). How is the money allocated there, Walter? What are you investing in?


Well, it’s — they have a few funds at work right now. Actually, they’re doing pretty good. I have them written down here. I think it’s turned in like 14%-15% so far this year.


Okay, well you’re —


It’s just a few funds. There’s no stock in the company.


Sure, sure. Well, what you want to look at is if you don’t have the ability to <Inaudible> it into a fund, you have what’s called target-date funds in your plan.


Yes, we do.


That maybe a little bit better approach for you. They’re not as exciting as maybe what you’ve got going on right now in a rising market like we’re having right now, Denise, Right? Everybody’s happy with their market mutual funds.


They’re very, very happy.


But that whirlwind <?> is going to happen, so you may want to consider moving some of your money into the target-date fund, which is geared towards your retirement date.


Oh, okay.


So that’s a little bit more conservative. It’s kind of a set it and forget it. As you approach that date, it becomes more conservative and it avoids having the bottom fall out when you’re ready to retire.




Another thing to consider, too, is — Walter, I don’t know if you have any emergency fund. Also, if you’ve got extra money coming in, you might want to establish that if you haven’t already, which is typically — You said your wife stays at home?




Okay, so about at a minimum, six months worth of your net expenses.


Oh, okay. Yeah, I don’t have one of those.


You do or do not?


I do not, no.


Well, how much is in your Roths, Walter?


I think right now — I think, I don’t know, there’s a little over 100,000.


Well, there’s your emergency fund. You could always take out from your Roth what you put in without any kind of penalty. I’d go back to putting in the $24,000 in to your 401(k). Next year, as I said, it’s going to go to 24,500. And if you want, you still have time, you can go to HR and say, listen, I want to take out the maximum that I can — It might be your whole paycheck! — between now and the end of the year to get that $24,000 stuffed in there. But you’ll be a happy camper come tax time next year.


Oh, yeah, I wish I could afford that.


Well, if you have money around, use that money that you’re bringing home. If you have money sitting in a checking account or savings account, use that money instead of what you’re going to bring home in your paycheck. It’s the same thing. You’re just taking from one bucket and putting into another, but you’re going to get tax deductions.


Right. What I was doing is I was taking my money that I’m getting from a previous employer. They allow me to take my pension early with — I mean, very, very little penalty — and that’s the money that I was using to put in extra to my 401.


Okay, well, once again: Strive to get the maximum that the law will allow you, to put in $24,000, and you’re well on your way.




Alright? Sounds good. Alright, thank you very much.


Thanks for the call.


Yep, thanks so much, Walter. If you would like Walter’s line, it’s 844-220-0965, 844-220-0965. You could take, at 53, when does it go from 18,000 and start increasing, at what age?




50, thank you. I was wondering what that was.


There are some benefits of getting older.


And that’s one of them, absolutely!


Got to focus on that.


As you said that, when you said — oh, yeah, when does it go up from 18? 50! Interestingly enough. There you go.


Interesting, Walter said he’s maxing out his 401(k) and that’s a common thing that people think, I’m maxing out because I’m putting in what the company’s matching.


No, I was in that camp, too.


Right, everybody does that — a lot of people do that.




You want to put in what the law will allow you to get that maximum tax deduction, and as I said, go to 24,500 next year.


Yeah, and <Inaudible>.


It’s one of the reasons we’re on the radio, right?


Sure, that’s why we’re here.


844-220-0965, that’s 844-220-0965. Or you could text us, 21232, that’s 21232. We are playing tomorrow —




— with Joe Bert and Denise Kovach from the Certified Financial Group here on news 96.5 WDBO.


Hello and welcome back, it’s On The Money with the Certified Financial Group here on News 96.5 WDBO. Joe Bert and Denise Kovach, our certified planning professionals at Certified Financial Group and they are here to take your phone calls at 844-220-0965. That’s 844-220-0965. We also have our text machine up and running as well, 21232. That’s 21232. Not only do they come here on the radio each and every Saturday morning at 9:00am to answer your QS on WDBO, another service they offer is the workshop.


We’ve got workshops! Yes we do. In fact, the good news is that this coming Thursday, the lovely Denise Kovach who’s sitting right here to my left, and Nancy Hecht, the lovely Nancy Hecht as well will be doing a Social Security Bootcamp: Planning Strategies. There’s a lot of different things you can do with Social Security, and most people make the wrong choice because they just don’t know. So, Thursday evening from 6:00 to 7:30 in our office in Altamonte Springs, Nancy and Denise will be holding a workshop. It is absolutely free, leave your checkbook at home. We’re going to have some light refreshments, and I guarantee you will get a lot out of it because the wrong decision could cost you tens of thousands of dollars. Spend some time, come on by. All you have to do is go to our website. That’s financialgroup.com, financialgroup.com. Click on the menu — if you’re on your mobile app, click on menu and go to workshops, and you can sign up right there. Or you can call our office right now at 407-869-9800, 407-869-9800, and leave a message on the recorder and we’ll be sure to save you a seat. We hold this in our classroom. It’s got to accommodate about 25 people, nice open area, and nobody’s crammed into a small room. We’ve got some food and refreshments and some great information. Once again, that’s this coming Thursday starting at 6:00 to about 7:30, and you better be there if you want to know about Social Security.


You’ll also learn a little bit about the upcoming COLA, or the cost of living adjustment that <Background Noise>


Big news yesterday!




Big news, why don’t you our listeners about that, Denise?


Well, basically, it’s a 2% increase in the benefits for 2018, which is the largest cost of living adjustment since 2012.


How about that.


So, let’s see what they do with Medicare.


The good news is, you’re going to get a bump in your Social Security. The bad news is, you’re going to get a bump in your Medicare Part B premiums and it’s going to almost eat up everything that they’re going to give you on the other side.


But we don’t know that yet.


Well, I know Medicare is going up, because they did raise it on 70% of the people last year because of the rule that if you’re already getting — yadda, yadda, yadda, but you can expect Medicare will go up. You get to keep a little bit of that 2%, but the entire 2%.




But, that’s just stuff you’re going to cover in the workshop.


I am! But don’t we have a couple more coming up?


We do have a couple more coming up. Let’s talk about healthcare options in retirement. Gary Abley, CPA, Certified Financial Planner professional, will be holding this. This once again ties into those decisions that you have to make about Medicare. What are all these options? When you get to be near the ages of 65, you start getting inundated with all these Medicare options, which plan is best for you. The good news is that Gary is an expert in that area. He can talk about what Medicare Part A is, Part B, Part C, Part D, Part F. All those choices that you have to make. He’s not going to try to sell you anything. He doesn’t do Medicare supplements on this stuff. He wants to give you some good information. Once again, information on that is on our website. That’s financialgroup.com, financialgroup.com. If you’re on the mobile app, click on the menu, go to workshops, and you can make a reservation right there. Or you can go to your phone and call our phone at 407-869-9800 or 1-800-EXECUTE. If there’s no one at the office, you can leave a message on the recorder. It’s absolutely free and you’ll be glad you went, and I’ll see you there.


I can use my phone to call your phone?


How about that, huh?




What a concept!


Yeah, I <Background Noise>


That’s right! Man, I tell you what, technology these days, let me tell you!


Full of surprises.


844-220-0965, 844-220-0965 is the number to dial us up. It’s easy to just call in right now. We’ll get your phone screen during the latest news, weather, and traffic with Dave Wahl at 96.5 WDBO! 9:35, here at News 96.5 WDBO is On The Money with the Certified Financial Group. Joe Bert and Denise Kovach are here live in the studio taking your phone calls at 844-220-0965, 844-220-0965. Joe, what are you doing here in the studio today?


Any questions that might be on your mind regarding your personal finances. As we say, we go through life, try on some of this, try on some of that, and wake up in our 50s to find out we’re dealing with a collection of financial accidents!




So, we’re here as your financial body shop to knock out those dents and creases that you might have in your financial situation, and answer questions that you have about stocks, and bonds, and mutual funds, and real estate, and long-term healthcare, and IRAs, annuities, reverse mortgages, all that is what we are here.


The good news for you, there’s a couple lines open. However, we have Sophia, I see, on line two. Sophia, talk to me —


I was going to say, let me get out the phone number real quick: 844-220-0965, 844-220-0965. And the text number is 21232 and we had a texter text in earlier, but the message had a lot of characters in it and we didn’t get the full message, so we invite them to send their text in again or just give us a phone call.


844-220-0965. Nobody fixes the bumpers of a Roth IRA like Joe Bert. Sophia in Sanford, you are up! Sophia, go ahead. You’re in Certified Financial Group here on WDBO.


Hey, yeah, my last name’s Procrastinator.


And your first name is Sophia, I can tell. You like a sweetheart, Sophia.


What’s on your mind?


Here’s what I want to ask you, real quickly. I was the one that called awhile ago. Should’ve came in 20 years ago, I want people to know that, because I didn’t wake up one day — I wake up every day worried. What I was going to ask you was, I have a mutual fund — I’ve had it for, I don’t know, 25 years, 30 years And you’re right, you said a while ago, things are looking good, and my question in my mind is, what do I do with that? I mean, if it’s hot, do I get rid of it, hang on, and the other part is I don’t know if I can tell you what fund it is, I don’t know if it’s half stock, half bond, I don’t know, you know? I don’t know if I’m allowed–


<Inaudible>. Nobody’s going to go through the phone and tell you you shouldn’t say that. What’s the fund?


Fidelity Puritan fund.






All right.


So Denise, how would you– You’ve got a lot of money —






The symbol. I’m very aware of that fund and it is a moderately allocated fund so anywhere between 50% and 70% of the holdings are going to be invested in equities and the remainder will be invested in fixed income and the like so it’s an allocated or moderately allocated fund already. It’s a highly rated fund so it’s a good fund. It’s actually risk tolerance which is moderate then you’re in the right place. If you are aggressive then maybe you need to consider moving some of that into something a little bit different, it could be more conservative, it’s the opposite. So does that answer your question?


Well my second question is– I should have came in and seen you. It’s not the only fund I have but what I’m saying is I’m 66 and I really don’t– you know, I just want to kick back but I’m saying if I come in and you tell me if it’s high right now, sell it, and then you put me in something that’ll give me income, you know what I’m saying?




All depends.


Here’s what you want to have done and here’s what we do for our clients, so if <Inaudible> here’s what–


My middle initial’s S, okay?


Well call him Mr. Procrastination, Mr. P.


That’s my name!


Here’s what you want to have done. You really want to have a plan done and that’s what Denise and I and the other certified financial planner professionals at CFG do day in and day out. What you want to know is what you need to do now with the assets that you have. Are you still working?




Okay so your income has stopped for all intents and purposes. Are you collecting Social Security?


No, I screwed up on that last year. I called you once before, I thought it was 60s– No, I did have ’em done, I’m sorry.


That’s okay, that’s fine, and that may be a good thing, if you’re able to not need Social Security you’re letting that benefit grow by 8% per year and now you get another 2% kick with what happened last year, or this year on the cost of living. But anyway, here’s what you want to have done. You want to have somebody look at your situation, and everybody is unique with what you spend, with what your lifestyle is, there’s no rights or wrongs, factor in what your current assets are, what your projected income will be from Social Security and if you’re fortunate enough to have to pension of course we factor that in. Any other sources of income that you might have, you have rental properties, and all that kind of stuff and then is there a gap, is there a delta between what you’re going to be bringing in and what you want to spend? If not then you have a surplus and what you want to do is what we do with that surplus and set aside for the future, to when the cost of living increases. If you have a deficit how are you going to pay for it and where’s that money going to come from and what bucket are you going to take it from? Once we do the planning then we know how conservatively you can invest your savings and investments to kind of a high probability of not running out of money by the time you’re 93, and that’s what planning is all about. We charge a fee for that. Right, Denise?


We do!


And the fee is based on how much time it takes to do that plan.


Which could be considerable.


Or it could be straightforward, but the thing is is we offer you a no obligation visit. You can come on by. We get to know you, you get to know us, we can answer some very basic questions for you, but generally most people want peace of mind. They want to know at the end of the day that they’re going to be all right, and you’re like 99.9% of the folks running around out there trying some of this, trying some of that, listening to people on the radio on Sunday morning and trying to figure it all out. But it’s like going to the doctor for the first time. You don’t know if you’re in great health or if you need to be taking some kind of vitamins or, heaven forbid, you’re terminal. And we don’t pull any punches; we tell you the good and the bad and what you need to do now, so you’re going to be okay. And our job is to make it work, not to send you out the door and say, man, you’re a basket case, is not going to work. Our job is to show you what it’s going to take to make it work, and that might be working longer, might be spending less, it might be going back to work. You know, there’s all kinds of options and there’s all kinds of different investment options that you have that you haven’t even thought of but it’s what’s in our toolbox, and we can show you how to make it work, so I would suggest, Mr. Procrastinator, that you’ve been thinking about this long enough, pick up the phone on Monday morning, give Denise a call and come on in. We’ll give you a cup of coffee, and you can learn all about us and you can learn about the workshops and we’ll put that pain that you might be dealing with right now, put your head on the pillow at night and be able to sleep soundly.


That sounds really good, and Sophia, definitely you haven’t started your Social Security yet, so as you know or may have heard earlier I am hosting with my colleague Nancy this coming Thursday–


Yeah, it sounds like Thursday night. Yeah.


Social Security boot camp, so that I’ll give you some more information about why it might be advantageous for you not to start Social Security <Inaudible>.


There’s no need to wear the wig if you come in the office.


Ha ha ha!


Can I ask you one thing?


Of course.


Hello? Oh yeah I wanted to say when I get off I want you to tell me when that workshop is, but you know the thing is I was 99% of the people, you know, if my tooth hurts, you don’t– you go to the dentist and that’s what — I just never thought– Here’s one thing. You ask me how I’m living? Eating savings. You know, as long as I have it, and it’s not fun, I mean, some of my friends say hello you got a little bit of money, you know, what happens when it’s gone?




Uh huh.


That’s a scary thought.




It’s scary. Every day it’s scary, so I need to come to see you, I should have came 20 years ago so <Inaudible> listening, think about it.


Well it’s never too late and the good news is you now realize you have a toothache that a dentist can fill and help you with so come on by. At least at a minimum come see Denise on Thursday evening at our office in Altamont Springs, and go to our website, that’s financialgroup.com, click on Workshops. You can make your reservation right there and if I’m still hanging around at 6:00 on Thursday I want to meet you. All right?


All right.


So be in, Mr. Procrastinator. Thank you so much for the call. Again, it’s 844-220-0965. Got a text question in here, 21232. Does paying credit cards off and canceling them voluntarily hurt your credit?


That depends. You’re not going to want to — Paying credit cards off and canceling them, it really depends, you need to keep at least one or two or three open with no balances, and pay them off and don’t close the accounts, that’s going to help your credit. But I wouldn’t open an account, pay it off, and cancel it. I don’t know if that’s <Inaudible>


Yeah, there are these algorithms that the credit card companies use and the credit bureaus use in terms of how much credit does she have available to you so the more credit cards you have, that affects it, but the most important thing that affects your score is your payment history.




Of all over and above everything, the thing that really affects your credit score is your timely payments so if you’re making timely payments and you’re paying a credit card off on a regular basis, that’ll help you, and if you have too many credit cards, maybe you want to cancel one or two of them.


Exactly. But leave, you know, two or three open, and–


Yes, yes.


Pay ’em off every month.




That’ll help.




All right. All right, as simple as that! 21232, that’s 21232 for the text question, let’s go to Mary on line one. Mary you’re on with the Certified Financial Group here on WDBO.


Good morning, Mary!


Hey Mary!


Yes, good morning. So I’m a woman in my 50s and I’ve always worked on my life stage and at this point my husband and I have gotten all three kids through college without loans. We’ve paid off our house <Inaudible>. My situation is though, my mother-in-law who never wanted to work, who’s actually in better health than me, but she’s in her late 70s, she got a divorce in her 40s, never wanted to work, and she got an inheritance and lived off of that, and really it’s gotten to the point where she and her husband are barely getting by. He’s dying of cancer, he’s like 80 and probably in the next year or two unfortunately he will sadly pass. And two years ago apparently she took out her first mortgage. She <Inaudible> paying enough in the family, and I’m kind of trying to understand like okay so she barely ever worked. First of all I’m assuming she would qualify for his Social Security, right, her husband’s?




But other than that how do you help look at — Okay, because I don’t think she even has a reverse mortgage. I’m not sure I think she’s really stuck there, or frankly she’s in this house, it’s old, needs all this work, with the hurricane, needed all this help with getting trees and other stuff taken down, I mean, it’s an expense just staying in this place. I’m trying to figure out like how do we figure out — I mean, she’s literally, she’s like runners that run out of money because she just hasn’t done anything and then again doesn’t have any health needs.


Well Mary, <Inaudible> at the house, the reverse mortgage will have to be repaid. Now when she took out that reverse mortgage did she do it in– I mean, is it being paid to her on a monthly basis? Is it a line of credit? If so, does she use it? Does she have access to it still? Do you know?


I don’t know. And those are things <Inaudible> when something happens but she called us this week and said oh we can’t afford the cable anymore and they’re just literally living basic, basic. So I don’t know. So I guess somehow I just kind of feel like when it happens, but I just feel like it’s a money pit having her stay in this place, and we’re going to have to subsidize her for that.


Well what you have to do is get a handle on the reverse mortgage situation. When she took out the reverse mortgage, what Denise alluded to she had three options. One is to get a lump sum, which is probably the worst thing for people to do because they take the money and they blow it. Okay?




So the second option is to set up what we call a line of credit which means <Inaudible> as you need it and you need some now, you take it out, and then you shut it off and you take it again out as you need it, and the third thing is you get a monthly check, and we don’t know what choices that she’s made in any case she had some debt on that property because she has withdrawn some money. We don’t know how she’s done it but she’s withdrawn some money, so what you need to do is get your hands on the statement and find out how much she owes on the mortgage and what the house is worth and if there’s any equity. And then you make a decision. Do we sell the house? If you sell the house you pay off the reverse mortgage and you move on down the road with whatever equity she has, or you decide you know, there’s not much equity but what are we going to do? Maybe she should stay in this house, and it’s possible she could refinance the reverse mortgage if she took it out years ago. Perhaps the property is increased in value and now there’s more equity that she can draw from it. So you’ve got to get– first place is to get your hands on the statement, don’t you think?


She needs to wrap her hands around it.




Yeah, yeah.


And then you make a decision to switch <Inaudible>


Are there other things that she would know? Her husband was in the military so he gets those health benefits or will she get any– now, now, when it qualifies, this is his fourth marriage.


How long has she been married?


They’ve been married for 18 years at least?






I am not an expert in this. The good news is we work with an attorney who is an expert in VA benefits and she <Inaudible> to his stuff, particularly if he’s ill and there’s help that she can be getting, financial aid that she can be getting to help him so why don’t you call Denise on Monday morning and she will give you an attorney’s name and we can direct you to her and you can get that ball rolling, because that may be of help to you and to her in this immediate time.


And is there any other resource, and the reason I’m asking is now I’m still working at 50 but frankly I have some significant health issues and ironically she’s in her 70s and she’s healthy as you can be. But I have some genetic things going on so me having her eventually move in with us is probably not practical because I can’t lift anything, I can’t do anything and it’s like so for her living in this house I can’t be — I don’t know.


You can’t be taking care of her, she’d be taking care of you.


Exactly. I mean, it’s just kind of like it’s just <Inaudible> essentially by age 79 she’s going to need help and it’s like having her move in with us it’s like I can’t help <Inaudible> take care of her. So is there any other resources that you can turn to in the community or other things to kind of — I mean, we’re going to have to help support her some way financially but it can totally drown us trying to support somebody who again just hasn’t chosen to work or save all her life.


I hear you, I feel your pain. I’m sure there are community organizations but you kind of fall in that odd situation that you’re not destitute and so what you have to do is use the resources and assets that you have and this is unfortunately a classic case of somebody that went through life and did absolutely no planning. And now you’re facing reality. So it’s a wake up call for you for you to do some planning to see where you are–


But the thing is I’ve done it all my life, I’ve worked all my life, high school, college, my whole life, raising kids, saving money, paying stuff off, and doing whatever and now to be stuck with someone who like did nothing, it’s like but I definitely think it sounds like I could benefit from still meeting with you guys and getting a plan set up for myself.


There you go.


But I guess as part of that can you figure out — are there ways, for example, with part of that financial planning to say, okay, can I be giving her so much money a year and actually <Inaudible> as my dependent, so I’m getting some kind of break for that?


Yes. We factor that into the planning situation if that’s where you are. So and then in fact I just met with a client this week who’s supporting his sister, who is in an assisted living facility, and he’s giving her $500 a month and we showed him the impact and actually it’s $1,000 a month. We showed him the impact of that on his personal financial situation, and once you see what that is now he has to make some tough decisions. She’s eligible for care or moving in with her daughter, but she doesn’t want to do that. She’d rather still get $1,000 a month from her brother. But it’s draining her brother and he didn’t realize how much he’s drowning until he saw it in black and white. And now it’s a wake up call, but that’s what planning is all about. We get into the nitty gritty and show you what the decisions are and that you’re making or going to make what the impact of that is. So give Denise a call, Mary, that’s what we do day in and day out, we plan to help you.


Mary, we are up against it, so we got to let you go, but go ahead and give Mary the phone number, Denise to your number Monday.


407-869-9800 or denise@financialgroup.com.


All right, that’s going to do it for this segment but if you want to get your question answered there’s still time at 21232 is the text question, 21232. We have been planning tomorrow with Joe Bert and Denise Kovach, on News 96.5, WDBO.


Well it is the final segment of On the Money with the Certified Financial Group and we’re looking at the clock; we got about a minute and a half left. We went a little long in our last segment so one more time– the workshop information so I can come visit you at your office show with Denise Kovach.


Well, Nancy and I are going to be hosting our Social Security boot camp discussing <Inaudible> planning strategies that’s going to be happening this coming Thursday which is the 19th of October at our offices at 6:00, planning to spend about an hour, hour and a half, we’ll have some light refreshments for you. We have another workshop coming up, hosted by Gary Avely, coming up on November 4, from 9:00 until 11:00. That’s in the morning, it’s about health care options in retirement. So Medicare, part A, B, C, D, and so forth and so on, and then one more on the 11th of November, everything you want to know about mutual funds. Again, hosted by Gary Avely, 11/11 from 9:00 until 11:00. In our office!


<Inaudible> 11/11 at 11:11.


I like that.


On our website, that’s financialgroup.com, click on Workshops and you can make your reservation right there.


Be back here next Saturday 9:00am with the Certified Financial Group


Dictation made on 10/17/2017 5:02 PM EDT.


Hosts: Roger Johnson, CFP®, AIF® and Nancy Hecht, CFP®, AIF®

Good morning Central Florida, this is another edition of On the Money with the Certified Financial Group.  Today we have Roger Johnson and Nancy Hecht in the studio.  How are you guys this morning.

Doing okay.

Doing great.

Filling in for Joe Bert.

It seems like it’s been half a year since I’ve been here.


Well, it’s just so much has happened in the last month.

Well, that’s true.  We had the hurricane September, and then October.  Well, when was the last time you were here.

Well, it was — I don’t know.  It’s been ages.

Been a while, alright.

We got pre-empted twice because of the hurricane.

Well, you filled in a lot in the beginning of the year.  You did a lot of the running <?> to work in March and April, you were here like every other week.

Oh, whatever.

<Inaudible> you got a break, yeah.

I like talking to the listeners.  It’s always a challenge and interesting, because we have no idea what people are going to ask.

Well, that’s the fun part.

Yes it is.

So let’s open up the phone lines.  844-220-0965.  844-220-0965.  We’ll also open the text lines while we’re at it, 21232, it’s 21232.  Alright, since Joe’s not here, Nancy, Roger, who wants to do the honors of saying what can we call you about today.

Well, what are we here for.  We’re here to answer your questions about your finances.  We’re not debt consolidators, but we’ll talk about saving for retirement, stocks, bonds, mutual funds, real estate, IRAs, 401ks, Social Security, DROP programs, annuities, health savings account, reverse mortgages.  All those and more, as Joe would say, we will be here to talk to you about.  As he also does say, during the week we charge a fee and on weekends we do it for free.  Of course during the week, we also do complimentary consultations.  So if you have any questions you’d like to call us about, we’d be happy to talk to you over the air about, or if you have some questions you are — a little bit more in-depth conversation, feel free to contact us through financialgroup.com and ask for a complimentary consultation.  You’ll get to speak with one of the certified financial planners at Certified Financial Group.  We will take your best interest in mind and try to guide you through some of the questions and concerns you have for retirement.  We are here, phone lines are open.  We even have that text messaging thing.

Yes, text messaging thing.  It’s 21232, but you say you can dial these magic numbers, and that’s fun <Inaudible>.  I was hoping you would say <Inaudible>.  844-220-0965.  844-220-0965.  Again, the text as well, 21232, that’s 21232.  If you do have a text question, we ask you to keep it to 160 characters.  That’s all we can see per line on our display here in the studio.  If you have something, may have a follow-up, that’s what the phone lines are for.  844-220-0965.  Topic of the week here, Nancy, I believe, navigating the three phases of retirement.  Or Roger, Roger, okay.

Well, I put some thoughts together on that.  We’ve spoken with hundreds of clients over the years, and they prepare for retirement, and they think about, well, what’s my withdrawal strategy.  How am I going to pay for retirement.  Of course, that’s what we do during our years that we’re working, we’re saving enough.  But then we get to that point and we start thinking about, well now we’ve got to take money out of certain aspects of our portfolio and pay for retirement.  And really, you think about retirement as maybe three phases: the go-go years, the slow-go years, and maybe the no-go years.  What I mean by that is the first few years of retirement, people want to go and do some traveling, spend some money, have fun and knock out their bucket list.  Quite often that takes a lot of money, so that’s going to be maybe a higher rate of withdrawal.  Then we get a little older, and maybe some health issues, and we tend to stay at home a little bit more and spend less.  So that would be maybe the slow-go years.

I like that.

I do like that.

And as we get a little older, we then — you know, we’ve been caring for ourselves in that slow-go period, but then there’s the no-go period we’ll call it where we require assistance from somebody else through our health issues or just unable to take care of <Inaudible> whatever the problem is.  We need care from somebody else, and that usually costs money.  So, these three phases of retirement, you might think of them as three separate withdrawal strategies, which we talk about with clients.  You could think of it as a V-shaped expense.  In the early years you’re spending a lot.  In the mid years, the slower years you’re maybe not spending as much.  But then in the later years, you’re spending a lot mainly for healthcare and services.  Just a lot of ways of looking at it, and strategies, and ways that you can take Social Security, how to best take from different accounts, taxable accounts, non-taxable accounts, tax deferred.  There’s a — the best strategy based on your income and your separate situation, it’s not an easy answer for everyone.  But those are the kind of things that we work with with our clients from dusk to dawn and dawn to dusk.

Alright, well he’s Roger Johnson alongside Nancy Hecht, certified financial planning professionals at Certified Financial Group.  We’re taking your phone calls at 844-220-0965.  It’s 844-220-0965.  Let’s start today’s conversation with Susie in Orlando.  Susie, go ahead, you’re on with the Certified Financial Group here on WDBO.

Hi Susie.

Hi, thank you very much.  I had a question about the recent Equifax breach.  The question is if somebody has already frozen all their credit reports and they have taken their Social Security number and blocked it electronically, and they don’t do any online financial work, then is it really necessary for a security monitoring service.

Well, it sounds like you’ve pretty much taken care of everything.  If somebody has actually — and I assume that you’ve actually done all of that, it does not seem like it’s necessary to pay for an additional service.


Well, there’s an additional worry you have, and I know people close to me that this has happened to, is — and I don’t believe freezing your credit can stop this — is a bad person filing a tax return in your name and applying for a refund if they know you’re going to be getting one, or they think that oh, well that person might make enough money, they might have a — before you file your return, they file one in your place.  They receive the — and they claim all sorts of refund, and get the money, and somehow they clear it through whatever methods they clear checks, because it’s going to be made in your name.  This is an issue, and it’s not going to affect your credit, but it’s a bigtime hassle.  So keeping track of your Social Security number through that — and credit monitoring may or may not even pick that up.

No, it generally does not.  I’ve had a couple clients that have been in that situation.  And Equifax has been hired to monitor tax returns.  That was just —

Oh yeah, well I wouldn’t use Equifax for anything.

No, no, and I think that their credit rating is worthless now.  But it sounds to me, Susie, like you’ve covered all the bases yourself.  If you want to take advantage of a credit monitoring, there’s a number of them out there like Credit Karma which are free that you can sign up for.  But it sounds like you’ve done a good job of protecting yourself.

Okay, thank you.

<Inaudible> and I would still suggest every three or four months, apply for a credit report from each of the three agencies and see what they show up.  Those of course once a year are free.

Yeah, the annual free —

Yes, I do those.

Well, good for you, Susie.

You’re very proactive and I think that’s great that you’re doing that.

Because I think that’s just one of the biggest I hear.


Thank you very much.

Thank you.

Have a great day.

Alright, thank you so much Susie for the phone call.  If you want Susie’s line, it’s 844-220-0965.  844-220-0965.  Let’s got to Butch in Melbourne.  Butch, you’re up next with the Certified Financial Group here on WDBO.

Hi Butch.

Good morning, how are you guys.

We’re good, how about yourself.

I’m doing fine.  I’m driving down 95 right now, but I’ve got you on speaker, so no problem.

Good.  Keep it under 100 will you, come on.  Okay.

Oh yeah, we’re doing well under that.  I have a quick question for you.  I’m retired military, retired state worker, have a pretty good retirement fund built up, and I’m still paying on a house.  I feel like I could get a little more out of that house payment if I was to pay my house off and invest that amount back in the market.  What do you think.

Well, I like the idea of getting your house paid off just for because of the fact that you would like to get it paid off.  I mean, there can be arguments that either way, don’t pay your house off because of the cheap money out there, it doesn’t pay to pay your house off.  But you’ve done a great job apparently of setting yourself up for a good retirement.  How old are you Butch.


Okay, so you’re near retirement sounds like, if not already in retirement.

I took an early retirement.  I started <Inaudible>.

Butch, my marker is are you still getting a tax benefit from carrying the mortgage.

No, I am not.  That’s not the most important <?> <Inaudible>.

Well then, depending on how much it might cut your emergency fund down, or if it’s a matter of just throwing a couple extra payments at the principal to accelerate it, go right ahead and pay it off.

And if Congress passes a new tax law, we don’t know what the future holds, but it may double the exemption and greatly offset any benefit you would have gotten from a deduction for interest, which apparently you don’t really have.

Yeah, but I mean to save that little extra for yourself versus paying it towards the house.

And sleepability.  I like to think about that.  Some folks are fine sleeping, going to bed at night in retirement, paying a mortgage.  Hey, that’s fine if you feel that way.  But if you feel comfortable knowing the home’s paid for and everything, they can’t take that away from you kind of thing, then strive to get that thing paid off as soon as you can without dipping into too much IRAs.  You don’t want to pay a lot of taxes taking money out of IRAs or 401ks to pay off your —

That’s what I considered, taking 20, 30 out a year and just pay down <Inaudible> it’s only a 15-year note.

As long as you don’t incur a lot of taxes by taking that lump sum out.  I’m not really a big favor of that.

I’m not a fan of paying any more in taxes than you absolutely have to.

Just double up payments until it’s out.  Put a five year plan into a three year plan.

Be careful on the road, Butch.

<Inaudible> what kind of prediction you guys got for the taxes getting through this year.  You think it’ll make it.

Oh boy.

I hope.  I really, really hope.

It looks like they may finally come through with something, but I wouldn’t guarantee it by any means.  Watch out for Washington all the time.  They may or may not get this thing done.  We’re concerned too as well.  We’d like to see something.

Stay tuned, as they say.  Well, thank you so much for the phone call.  We appreciate you calling in on this Saturday morning.  If you’d like Butch’s line, it’s 844-220-0965.  844-220-0965.  We’ve got Sally, Rhonda, and Susan, if you would like to be behind them, it’s now the perfect time to get your question in the queue here so we can ask it to Roger Johnson and Nancy Hecht, our certified planning professionals in the Certified Financial Group, 844-220-0965.  Now it’s time to get the three big things you need to know.

On a dark desert highway —

Hi, welcome back, this is On the Money with the Certified Financial Group —

— cool wind in my hair —

Here on News 96.5, WDBO.  We are four minutes away from the latest news, weather, and traffic with Dave Wall over in the News 96.5 newsroom.  Roger Johnson, Nancy Hecht from the Certified Financial Group here taking your phone calls at 844-220-0965.  844-220-0965.  Got a busy phone line and a busy text line.  We’ll get right back to answering some questions here.  Talk to Sally in Orlando.  Sally, you’re on the Certified Financial Group here on WDBO.

Hey Sally, how are you.

Fine, thanks.  Good morning.

Thanks for calling.

Thank you, quick question.  My dad passed away and left some properties in a trust for my mother.  We have found out that the tax rate on that trust is 55% on the income.  Is a trust the best way to leave assets in this type of manner.

It depends.  I mean, there’s a lot that can be done with titling.  A trust is put in place to help you avoid probate.  Probate in the state of Florida starts at 3%, plus legal fees and a lot of time, believe me, going through it with my mother-in-law who did nothing.  But, through titling, for example, you probably have bank accounts that are in your name alone, or joint with a spouse.  If you add a transfer on death, payable on death designation to that.  If you add a beneficiary designation to any type of investment account that you have, it will avoid probate.  <Inaudible> without having to go through the trust rigmarole that you’re going through right now.

Well, the trust transfer was seamless and <Inaudible> less, but the 55% tax rate hurt in the income on the rental.  I guess is there anything prepared in the future for that to change, or is that just the way it’s going to be.

We’ve seen very little from the proposed tax law changes right now.  Potentially, it would be really nice.  There’s been a lot of talk about getting rid of estate tax completely, which might help reduce some of the taxes that your family is being subjected to right now.  But until it’s passed and we get an idea if they’re going to be talking seriously about tax reform, we get an idea of what gets proposed, Sally, we can’t answer that question for you.

One more thing: if the real estate, if there is a different way to transfer real estate like through the probate process in the future, I guess you lose the step-up basis that you gain in the trust.  But you wouldn’t be subject to the 55% tax rate forever <?>.

Yeah, you do not lose the step-up in basis, no.  You do not.  So if you own some property and it was deeded in your name alone, and on the deed you put transfer on death to and named your children, your children would still get that step-up in basis.  They would avoid probate, and they would avoid the trust taxes, because there is no trust.  It’s just passing by title.

Is the property in a different state.

No, it’s here in Orlando.

A lot of time it’s nice to use an estate — some type of a trust when you have property in different states.  But there’s a lot of ways to skin a cat here.  It sounds like it’s already been done by your dad.

But going forward for yourselves, if you’re going to keep the property, you might want to look at proper titling without the use of a trust so you can avoid probate.  You get succession step-up in basis.  You preserve all the nice attributes and then avoid that <Inaudible>

Transfer on death is a nice way to go.  Alright, Sally, thanks so much for the phone call.  We are up against the time for the latest news, weather, and traffic with Dave Wall right here on News 96.5, WDBO.  But if you want to get behind Rhonda, Victor, and Dee, give us a phone call right now, 844-220-0965.  844-220-0965.  Hey, welcome back.  This On the Money with the Certified Financial Group here on News 96.5, WDBO.  Roger Johnson, Nancy Hecht, taking your phone calls at 844-220-0965.  844-220-0965.  Text machine’s up and running as well, 21232.  That’s 21232.  Before we get back to our busy phone lines here, Roger, what can you tell the audience about why they can call you on the radio today.

Well, you can call us about anything financial.  Stocks, bonds, mutual funds, saving for retirement, those kind of things.  That’s what we do during the week and that’s what we’re doing here at the radio.  We’ve been doing it for nigh on 20 years, as someone used to say.  We love talking to clients and helping them out, figuring out what’s best for them to do.  But before we go on, I thought we’d double back on Sally.  You may be thinking the estate tax rate of 50, 55, I’m not sure exactly what that is.  But if you have a trust and your — I believe your mom is the recipient of that trust, and it’s set up so that it’s a pass-through where any incomes pass through to her, it possibly can be constructed, and maybe it is already constructed so that it’s only at her tax rate.  It’s something to look into.  I would suggest a professional in the way of an attorney on that.  An estate planning attorney would be a great idea.  If you need some names or recommendations, feel free to give us a call and we’ll pass on some names to you.  Alright, just like that.

Alright, thanks so much Roger.  844-220-0965.  Let’s get to Rhonda in Leesburg.  Rhonda, thank you for holding on.  You’re up next with the Certified Financial Group here on WDBO.

Hi Rhonda.

Good morning.

What can we do for you.

Thank you so much for taking my call.  I just had a couple of quick questions.  I’ve been with Credit Karma for about a year, so I know that I can go through them and lock my credit report.  But my husband’s never been signed up with Credit Karma or anything, so how would I go about locking his credit report, and how do we block our Social Security numbers.  Because The Equifax thing is really scary.

Okay, so when you’re saying lock your credit report, you actually mean freeze, correct.


Okay, so all you have to do is Google credit freeze, and each of the credit services will come up.  It’s just going to take a couple minutes for him to freeze his credit with each one, and they have to be done individually, but it’s really easy to do.

It’s not that hard to undo it if and when you decide you needed to apply for credit or something, you needed your credit unfrozen, it’s a couple of dollars to do so and a couple of days to do it.  It’s not the end of the world.  It’s a great way for protecting, and then you’ll have to do it with each of the three credit monitoring services.

As far as blocking your Social Security number, I do not know how to do that.  I’m really sorry, I can’t help you.

I think that’s kind of part of the credit freeze, and that’s really the only way I know about it too.

Yeah, Google is also — <Inaudible> Google.  Alright, Rhonda, thanks so much for the phone call.  If you want Rhonda’s line it’s 844-220-0965.  844-220-0965.  Let’s go to Dee in Orlando.  Dee, you’re on with the Certified Financial Group here on WDBO.

Thank you, good morning.

Hi Dee.

I have a question.  I’m in my mid-50s and I just sold a home.  I have a little money in the bank.  I also have 401ks, some stocks.  Right now my daughter is in financial need, and I’m wondering if it’s a good time now to maybe liquidate some of my stocks and stuff.  Is that a good thing in my position to help her.  I don’t know, I’m just a little confused.

Dee, are the stocks held within a retirement account or outside of a retirement account.


Do you know what your cost basis is versus the current market value, do you have gains.

I have some gains, yes.

So if you want to help her, and it sounds like you do, and you can add up some gains maybe with some losses so you can reduce the gains a little bit, capital gains rate is generally lower than ordinary income tax rate.  The markets are, as many people feel, at an all-time high.  So the opportunity to take some gains off the table right now is — I mean, you know where we’re at now.  Roger and I were talking, if there’s potentially no tax reform and the markets could dip, and whatever gains that you are looking at right now may be gone.  So, if you’re in the situation where you could take advantage of it and help your daughter, then why not do it.

And you also said you sold a house recently and you may have some proceeds from that, are those available in the <Inaudible>

Yeah, they are, but I don’t have a pension.  So I was kind of trying to save that fund for <Inaudible>

Well, you brought up the next point I was worried about is that we all have kids that from one time or another would like to borrow monies, would like us to give them money and such.  I think to an extent kids know that, and they may take advantage of that.  So you’ve got only one chance for you to save for retirement, so you’ve got to really put yourself first on this.  So try to help her, sure, but within reason.

I don’t know, I’m just on the fence about that, because I want to help her, but I’m afraid that I’m going to take away from what I have, you know what I mean.

That’s my concern as well.

Well Dee, one thing I could suggest is have somebody do a financial plan for you before you lend the money to your daughter or give the money to your daughter, whatever the case may be, so you know how much you can actually afford to do without.

Right, right.  I just don’t want to sell any stocks or anything like that.  That’s just <Inaudible> and I don’t want to liquidate any of my assets right now.

Then look for a way to make sure your daughter does not get in financial difficulty again.

I mean, the Bank of Mama’s open right now and may be closing, and maybe should close after this particular help.

Tough love.


We’ve all been there.

A kid’s job is to test the Bank of Mom and the Bank of Dad.

<Inaudible> have a plan done, then you could use the plan as the edict as opposed to getting into an emotional tug of war with your daughter.

You could make the plan the bad guy.  But hey, very admirable you want to help your daughter.  That’s a great thing, and hopefully if you do, and you can get her turned around in the right direction, maybe that’s the best thing to do as well.

Alright Dee, thanks so much for the phone call.  We appreciate you calling in this morning.  If you’d like Dee’s line, it’s 844-220-0965.  844-220-0965.  Talk to Victor in Melbourne.  Victor, you’re on the Certified Financial Group here on WDBO.

Hi Victor.

Hi, good morning.  I’m calling from Melbourne.  I’m retired, 67 years old.  I have a 401k.  My house was damaged from the hurricane and now I need a repair.  I don’t know if the insurance is to cover all the damage or what to pay from my pocket.  My suggestion is is it better taking the money from the 401k for repairing the house, or what price for a small loan <?> that’s just an estimation <?> from FEMA.

Well, you’ve got a lot of moving parts there.  It really would involve probably more to sit down and talk to you about all your numbers.  If it’s a matter of a few thousand dollars or multi thousands of dollars, and how your assets are shaped, taxable, non taxable.  And then what you could do as far as maybe borrowing the money.  But it’s all really part of a plan, and I’d say before I had all the facts, I’d really want to know those facts before I gave you advice.  But maybe look into borrowing at a low rate, because you’ve got to fix the roof.  The roof is a big part of the house.  You’ve got to make sure <Background Noise> integrity of the home in place and get it fixed.  It’s a given, you’re going to have to fix the roof.  How to pay for it is going to be the next question.

If FEMA money is available, I would certainly apply for that.  Do whatever is necessary to apply for.

Yeah, low interest loans from FEMA, I’m quite sure they’re out there.  It’s worth considering.

Depending on what your tax bracket is, anything you pull out of your 401k you’re going to have to pay ordinary income tax on.


What about homeowners insurance, Victor.  Do you have homeowners insurance, is that going to pay.

Yeah, I have homeowners insurance, but I still wait for the adjuster.  I call, they say because this area it rains a lot, it rains every day, and the lady has <Inaudible> for this station <?>.  So to save the roof, it has to be dry 24 hours for this station <?> <Inaudible>.  So I still wait, but <Inaudible> take deduction <?> from the hurricane.  I don’t know if I can afford to <Inaudible> apply for the loan from FEMA.

Well, you’re going to have to crunch the numbers plain and simple.  If you pull $30,000, $20,000 out of your 401k or your IRA, and that plus the taxes, is it affordable, is it a wise move.  I mean, it’s really just going to be a simple number crunching kind of decision.

It’s up to you, Victor.  Thanks so much for the phone call.  If you would like Victor’s line, it’s 844-220-0965.  844-220-0965.  Let’s go to Bob in Orlando.  Bob, you’re on the Certified Financial Group here on WDBO.

Hey Bob.

Yeah, hi, good morning.  I have a question I think I know the answer to, but back in September of 2016, they were talking — it was before the election, they were talking about interest rates, and somebody from The Fed board said that there’d be another bout — there’d be an interest rate this coming meeting <?>.


And everybody was saying that you had retired, are at retirement, it’s no time to be in the market.  Everybody was advising to get out and get into <Inaudible> municipal bonds.  I’ve had a big chunk of mutual funds in Janus and Vanguard.  I’ve had them since the early ’90s, right.  I was in on that tech sector boom, which I lost in 2001, then 2008 came and took another big hit.  It just started coming back, so I said I could see this happening all over again.  I’ll be 74, so I said I don’t have another eight years to wait to recover.  So they were telling me, the fund managers were telling me that you could slide into a safe haven of 0% government bonds and stuff like that where you won’t lose anything on a crash.  So, that was like a snap decision.  I made the call <?>, so I wanted to put everything into a safe haven, which I felt was sliding <?> it.  So when I called the slider back and I realized that it was a false alarm, there was no interest rates, that nothing happened, they said you actually sold everything.  I said <Inaudible> it was a little long, <Inaudible>, they said that, didn’t <Inaudible> slaughtered <?>, we slaughtered them.  <Inaudible> there’s no sale done.  The next then <?> I’m getting 1099s for the last 26 years of dividends.  I was obligated to pay all the taxes.  Then to get back in, I’d have to sell the bonds and buy back in.  I said you know, this is something that I can’t believe happened.  I didn’t intend to do any of this, you could have explained it.  So far, the bottom line with the way the market is at a record highs, and I’m out about $250,000 doing what I did.  Right now, I’m talking to a local financial advisor, and it seems like I don’t know if it’s a good idea at my age to get involved with people like that.  If I gave him all of my money to invest, and there is a crash, I mean he’s still going to make his commissions and I’d be out even more.  I’m <Inaudible> just take my money and spend it, <Inaudible>.

Alright, Bob, yeah, so any time that you’re exchanging assets, going from Fund A to Fund B, it is a sale.  That should have been clearly explained to you.  Us, as certified financial planners that work for a fee, yes, we do get paid fees on the assets that we’re managing, whether they’re going up or whether they’re going down.  But I will tell you that in down markets, we have to work significantly harder and be in communication with our clients a lot more than in the up markets.  As your balances ebb and flow, so do our incomes.  Putting money — I was afraid that you were going to say that the person wanted to put all your money into an annuity, which I would have said absolutely do not do that.

You know, working with an advisor isn’t the worst thing in the world.  It’s actually probably the best thing for you to do if you need some advice going forward.  I would suggest using a fee-based arrangement so that you’re not sold products with big commissions and such.  It sounded like I think I heard you said you had a big number, like a $250,000 gain that you have to deal with, is that correct.

I’m actually down — being on the sidelines right now, I’m down about 250,000.  <Inaudible> $1M <?>.

It all depends, and working through the tax implications of whatever transactions went on will be part of your advisor’s help.

I think what you need to do, Bob, is interview a few independent certified financial planners and see who you feel most comfortable with.  Please feel free to give us a call.

Yeah, that’s that simple.  Do you have the phone number to the Certified Financial Group.

407-869-9800 Monday through Friday from 8:30am until 5:30pm.

407-869-9800.  It’s an easy number.

Easy number to remember.  Of course, you can always <Inaudible> Certified Financial Group.  Alright Bob, thanks so much for the phone call.  We are up against the break here, so if you’d like Bob’s line, it’s 844-220-0965.  Coming in, the three big things you need to —

1, 2, 3:00, 4:00, Rock, 5, 6, 7:00 —

It is the final segment of On the Money with the Certified Financial Group here on News 96.5, WDBO.  We are taking your phone calls at 844-220-0965.  844-220-0965.  It is the final segment, so let’s get to our last caller, Kathy in The Villages.  Kathy, you’re on with Roger Johnson and Nancy Hecht, Certified Financial Group here on WDBO.

Hi Kathy.

Hi there, good morning.

Good, thanks for hanging on through the break.  What can we help you with.

I have a question about the 1031 — is it 1031 or 1039 exchanges.

Probably 1031, is it real estate.

Right.  I’m going to be selling a piece of property I have in Claremont and buying a piece of property in The Villages.  I was just wondering if it’s a big headache to do a 1031 exchange or is it something that I should be considering doing.

Well, it’s not something you should do yourself.  You need to have some legal counsel to help you.  I know that you have to have the property identified that you’re going to be buying before you sell the property.  Beyond that —

Well, it’s got to be a like to like.  If you’re selling an apartment by a residential, there’s certain things you can’t do with a 1031.  So, are you familiar with them enough to say this is what you want to do, or are you still in the early stages.

Well, I know a little bit about it.  I’ve read about it, I’ve spent a little time.  I was thinking about selling it before, and I do remember it has to be like to like.  And that there’s an administrator that helps you with it and so forth.  I just wanted to know if —

Well, let’s for our listeners, the concept is to not have to pay taxes on the first sale.  You get to push the taxes over into the next property and carry forward any gains without having to recognize your taxes when you sell that first piece of property, I think you said in Claremont.  You could then buy the like property in The Villages and still keep the tax deferral of any gains you have.  That’s the idea there, and it makes sense, and it’s a good thing to really consider.  But make sure you do it right, and you’re getting early information from reading about it, calling us.  I would talk to a professional.  Feel free to give us a call.  We have some folks that do 1031s and we’ll get you in the right direction.

We’ve got 30 seconds left, so thanks Kathy.  I want to give out the workshops real quick.

Okay, 19th of October is myself and Denise Kovach doing Social Security bootcamp.  That’s from 6:00 to 7:30.  We’ll serve a light dinner.  Healthcare options in retirement, Saturday, November 4th, from 9:00am until 11:00am, hosted by Gary Abeley, light refreshments there.  And the third one, everything you want to know about mutual funds, Saturday, November 11th from 9:00 to 11:00, also hosted by Gary Abeley.

One more too.


<Inaudible> financial basics, life strategies for success, Saturday

Dictation made on 10/10/2017 3:45 PM EDT.

Hosts: Judith Sanborn, CFP®, AIF® and Joe Bert, CFP®, AIF®

Well, good morning everybody.  This is On the Money with the Certified Financial Group.  The Oracle of Orlando, Joe Bert here in the studio alongside Judy Sanborn.  We’re taking your phone calls this morning at 844-220-0965.  Good morning everyone.

Good morning.

Good morning.

How are you guys today?

We’re doing great.


How are you?

Alright, well what can the audience call you about today?

Well, Judy and I are here to take any questions that might be on your mind regarding your personal finances.  As we say, people go through life trying some of this, trying some of that, and wake up when they’re 55 years old and realize the paycheck is going to stop in the not-too-distant future and how do we turn our IRA and 401k and maybe the savings they would have into a stream of income so we can continue to enjoy what they say are the golden years.  And that’s what we do day in and day out with the certified financial planning professionals of the Certified Financial Group.  We answer those kinds of questions for our clients.  And Monday through Friday we do it for a fee, but on Saturday morning we do it for free.  So, if you have any questions regarding your personal finances, as it might relate to decisions that you have to make about a stock, or bonds, or mutual funds, or real estate, or long-term healthcare, IRAs, annuities, reverse mortgages, all that and more, we are here to take your questions.  And the good news for you on this cloudy Saturday morning, on this drizzly Saturday morning, there’s absolutely no one in line.  So, pick up the phone and dial these magic numbers.

Oh yes, they are 844-220-0965.  844-220-0965.  We also have the text machine up and running as well.  21232.  That’s 21232.  Hope you’re going to stay dry out there today in Central Florida if you’re out and about trying to get your errands done early before all the rain comes.  Well, stay tuned right here at News 96.5 WDBO.  We’ll keep you updated on the weather, but we’ll also have some great information and we’ll kick it off with today’s topic with Judy Sanborn.  Judy, topic today, did you jump the retirement gun? What you might miss when you choose to retire.

Yes, well, I think this is a very appropriate topic for me because I’m retiring at the end of this year.


So for 10 years —

So no more radio show for Judy Sanborn?

This may be the last.

No, you can’t —

This might be the last.

It can’t be the last.

Although, I have volunteered to sit in when Joe’s not available.


I will be around next year part-time.  However, I’ve been talking — and all of us talk, of course, about what — how to plan for your retirement.  And so last year, I thought to myself you know I should be listening to myself in what I’m telling my clients.  Maybe I should start planning for retirement.  So, there are a lot of considerations.  I think there are some interesting statistics.  Between 9,200 to as many as 11,400 people daily will be reaching the age of 65 for the next 16 years.

Baby Boomers.

Baby Boomers.  <Inaudible>

And we’re all thinking about retirement as we get closer to those ages.  Joe mentioned that we start thinking about looking at what assets we might have accumulated around the age of 55 and some people don’t do that until maybe 60 and all of a sudden they go oh, maybe I don’t want to work —

And some people don’t do it until after they’ve given their notice, and then they try to figure it out. <Inaudible> which is not a good scenario.

No, not a good scenario.  Not a good scenario at all.  So, I think it’s really important and all of us ask the question of our clients, well what does retirement mean to you and what do you think you’re going to do in retirement.  And some people have a whole list of things and some people look at you like what do you mean?  What do you mean what am I going to do in retirement? So, I think one of the things that is really important to realize as you start thinking about retirement is retirement is an oxymoron, which means the reality of retirement is we’re all wanting to get away from certain things, and the things we’re trying to get away from are actually the things that make retirement successful.

There you go.

So, what do you think they are?

Well, it’s the interaction with people every day.  It’s the ability to be creative and be productive.  It’s the ability to have a feeling of accomplishment at the end of the day, and of course the monetary rewards that may come with that.  You want to feel that you’re contributing something.  So, if you’re not employed or in a for-profit situation that you do the charity stuff.


Which many people do.

Yes.  And those are —

Did I answer those correctly, by the way? I didn’t <Inaudible>

You did.  No, you did.


You did a great job because most of us think in terms of retirement do we have enough money to retire.  But, we actually don’t think about what our workplace provides for us.  We don’t even think about it.  For one thing, socialization.  Just coming to work and having the opportunity to visit with people, chat with people, sometimes we’re the go-to person.  They go to us to ask us to help them solve problems and all of a sudden you’re retired and where are all your friends?


I’ve had some of my clients say gosh, I thought those people I worked with, they were my friends.  I never hear from them.  So, — and so I try to say, you might not hear from them, but you have to reach out to them because they’re still in their routine.  And it’s not that you’re not their friend.  They just don’t have time to really reach out.


So you have to be a lot more proactive at that point.

It’s like with your kids.  You know, your kids have their own lives and they’re not going to call you every day or stop in every day.  They have their own lives and so you may see them less often.  It’s not that they don’t love you anymore, it’s just that they have their own deal going.  That’s the way it works.

So, I think it’s important.  You need to have goals even in retirement.  You have to have routine even in retirement, and there are a lot of increased incidents of alcoholism, depression when people retire because they haven’t thought through those ideas.

And I think that you definitely need to stay physically active.


I think that is critical.  I mean, we see it with our clients.  Some of them are better at it than others.  Some of them retired and in fact they look better than when they were working.  But, you have to push yourself and that’s the reason that — if you turn into a vegetable —

You’re not going to live very long.

You’re not going to live very long.  That’s the sad reality of it.

And the incidents of Alzheimer’s and dementia certainly increases if you’re not active.


And you’re not physically active and mentally active.

Yup, yup, yup.

So, I have a book that I’ve been reading in preparation and it’s called the Couple’s Retirement Puzzle: 10 Must-Have Conversations for Creating an Amazing New Life Together.

How is it?

It’s really interesting because it has little quizzes that you sit down and you do together to see —

With your spouse? Uh-oh.

With your spouse or your partner to see where you are into retirement.

See if you’re going to retire together or go your own way, which oftentimes happens as well.



Well, if you have a question for Judy or Joe, it’s 844-220-0965.  844-220-0965.  Start today’s conversations on the phone lines.  Talk to Dave in Titusville.  Dave, go ahead.  You’re on with the Certified Financial Group here on WDBO.

Good morning, Dave.

Good morning.

Thank you for calling.  How can we help you?

Good morning.  Thank you for taking my call.  I’m an avid listener and respect your advice.

Thank you.

I’m in need of quite a bit of money to make repairs on my home and looking for some advice on the best source.


I’m going to need probably in the range of $60,000 to $80,000 and that’s about equal to what my net resources are if I were to liquidate 401k or a universal life policy that I have.  But I’m not sure I want to do that while the market is good.

Alright.  Let’s back up here.  You’re still employed?



And how old are you?


62.  And you need about $60,000 to $80,000 to put in your home and you say you have that in the cash value in your universal life policy.

And a combination of 401k and universal life.

Got it, got it, got it.

The universal life is probably about 40,000, but I haven’t looked at it in awhile.  But, it’s somewhere north of 40,000.


And do you have a family?

My wife and I.

Okay.  I would take it from the universal life first.

Do you have a need for the life insurance? <Inaudible> you might look at what potentially that life insurance policy might be for other than obviously the death benefit.

That’s the only reason to have it is for her if I pass.

Okay.  I would borrow from the life insurance policy because that’s your own money.  The thing that you need to know is that if you should die before you pay back that loan, all that happens is the death benefit is reduced by the amount of the loan that you have on the policy.  But basically what you’re doing is you’re taking out of one bucket, which is the universal life policy, and putting it in the equity in your home.  So, I think that’s the first place I would go.  What do you think?

I agree.  I definitely agree that you look to that first.


And then I would probably look at a home equity loan.  Do you have any equity in your home, I hope?

Yes.  It’s paid off.

Oh, well there you go.

Oh, that’s a great resource because that can be a tax deduction for you as well.

If you’re able to itemize.  I would probably look at the universal life first and then I would back-fill with the home equity loan.

Okay, how about a source for that home equity loan? I belong to a Credit Union.  Is that a good source?

That’s a good source.  Yep.

Excellent, okay.

We’re reluctant to suggest that you take money out of your 401k because what you’re doing then is you’re jeopardizing your retirement, which is around the corner.  But, using the home equity loan forces you to make that payment every month and get that paid off, and basically build that equity back up and keep contributing to your 401k.

Excellent.  Very good.  Okay, I think I’m on the right track.

Alright, Dave.  Good luck.

Thank you.

Thanks for the call.

Thank you all so much.

Have a good day.

You’re welcome.

Alright Dave, thanks so much for the phone call.  If you want Dave’s line, it’s 844-220-0965.  844-220-0965.  Text machine is up and running as well, 21232.  As I look at the clock we’ve got about two minutes until we get to the three big things you need to know, so now is an excellent time to announce some of the workshops coming up with the Certified Financial Group, a great resource you guys have there.

Yes, our next workshop is going to be Thursday, October 19th.  It’s in a couple of weeks <Inaudible> see when that was.  6:00 to 7:30 in the evening and the hostesses will be Nancy Hecht and Denise Kavach.  And the next one will be Saturday, November 4th from 9:00 to 11:00; healthcare options in retirement.  Gary Abley is the host for that one.  And there is one that’s next year, so I just point that out because it is When Can You Retire: Know Your Number.  It kind of fits in with what we’ve been talking about and you can go online to our website and see when all of these workshops are going to be happening and you can sign up for them online or you can call our office and register.

Just go to financialgroup.com, and that’s financialgroup.com, click on workshops.  You can make your reservation right there.  Simple-dimple.

Alright, just like that.  Financialgroup.com.  And hop over to their Douglas Avenue office.  It’s a great place.  I’ve got to come by and visit.  I haven’t visited in awhile.

Well, you’ve <Inaudible>.

844-220-0965 is the number to jump in on the conversation, 844-220-0965.  We also have the text machine up and running as well, 21232.  Just keep it to about 160 characters, that’s all we can see on our screen, 21232.  Dave Wall is in the News 96.5 newsroom right now.  It’s time to get the three big things you need to know.  Welcome back, this is On the Money with the Certified Financial Group here on News 96.5 WDBO.  Joe Bert and Judy Sanborn are here in the studio taking your phone calls at 844-220-0965.  844-220-0965.  Or, your text questions at 21232.  They are certified financial planning professionals and they are here on the radio giving out great advice here all morning long until 10:00 here on WDBO.  Got a text question at 21232, Judy and Joe.  I’m 41 years old, I have a condo that’s paid off, and I do have money to buy another property other than my house that I have now.  I’ve always been under — and that’s why we ask you to keep it under 160 characters ladies and gentlemen.  That’s all we can see on our screen because 160 character is apparently the average for the text for all the mobile carriers.  That counts as one text <Inaudible>.

This individual wants to know maybe buy another condo? What to do?

Buy another house? Buy another property instead of putting it in something? That’s why we ask you to keep it to 160 characters.

Right, because we’ve actually been contemplating what the under might mean.

Yes.  Under water? <Inaudible>

But, I think in general there are a lot of other questions that we would ask before we gave any guidance to someone wanting to buy an additional property, especially at 41 years old.  Need to know if they’re employed, what other financial resources they might have.

That would be an excellent question to call in with at 844-220-0965.  We’ve got a lot of follow-up questions.  This is a simple — easier text questions even though it has a long answer.  This texter writes in if I want to retire before 65, what happens to my medical insurance? What are my options?  That’s a simple, under 160 character text question.

Can you say Obamacare?

You really have to consider that and a lot of people don’t think about that when they decide they’re going to retire.  Because, we can take Social Security at age 62, so a lot of people focus on that and that brings up a lot of issues as to whether you want to take Social Security early.  But, from a health insurance standpoint, you’ve got to look at the fact that you can’t go on Medicare until 65, so you’re going to have to cover that expense somehow between the time you retire and age 65.  And yes, as Joe pointed out the Affordable Care Act is still available.  If you’ve been employed, you leave your employment, you can go on COBRA, which is an extension of your employer’s health insurance plan for 18 months.  And I think maybe —

<Inaudible> for 36.



So, you might be able to bridge that gap a little bit.  COBRA can be a little bit expensive.  As well, it’s definitely going to be more expensive than probably what you’ve been paying.  If you —

You have to factor that in.


Because it can blow up your retirement plan.  As we were saying, the toughest cases that you and I and the other certified financial planner professionals at CFG work on are — that’s a mouthful.

Yes it is.

People have come in and made the decision to retire and now they want to do planning.  It was like starting out on the journey, and you’re going, and then you pull out the map.

To figure out you’re not headed in the right direction.

Yeah, or you don’t have enough gas in the tank.  And those are the toughest cases we work on because you have to tell them, you have to turn around and go back to Go <?> or make some major lifestyle changes.  And you want to know that before you pull that trigger because most people as they’re approaching retirement are generally in their prime earning years.  You’re getting the maximum income.  You’re contributing to your 401k.  You have your health insurance taken care of.  I can tell you that time and time again I have shown to clients the difference that it makes to work another 12 to 24 months.  You don’t see it immediately, but you see it in your out years in your 80s and in your early 90s, the difference that delaying retirement for a couple years makes as opposed to grabbing it now or grabbing your Social Security when you’re 62 and I want it now because I don’t think it’s going to be there.  Well, I’m not worried about that.  I’m worried about you running out of money.

And when I have younger clients, maybe lat 40s, early 50s that come in and visit and they are thinking a bit ahead, but they’re also wanting to retire early, I talk to them about the fact that their life expectancy potentially is 100.

That’s what I’m planning for.



Yeah.  So, if you think even if you retired at 60, you’re going to live on some kind of a fixed income for 40 years.  I always tell them that I hate to tell them this, but they’re probably going to work until they’re at least 70 and the closer you get to the ages that you used to think were old, they’re not so old anymore.

That’s correct, that’s correct.

So, we have to be realistic about our potential for living a long life and being able to comfortably have money to live a lifestyle that we would like to live.

Yeah, I’m planning to retire at 62, but expecting to work to 65 because that’s me.

There you go.

There you go.

Alright, 844-220-0965.  844-220-0965 is the number to call in and ask a question on the phone lines.  If you want to ask a question on the text line just like we’ve been answering in this last segment, 21232.  That’s 21232.  Right now it’s time to get the latest news, weather, and traffic with Dave Wall on the news <Lost Signal> it’s now time for the second half of On the Money with the Certified Financial Group here on News 96.5 WDBO.  We’ve got Judy Sanborn, Joe Bert the Oracle of Orlando, here in the studio taking your phone calls at 844-220-0965.  844-220-0965.  Joe, how did we come up with the Oracle of Orlando for you?

Well —

Do you remember that?

Well, I can tell you.  There was a listener — hope he’s still a listener — I believe the name was Anthony from Apopka.

He remembers the caller’s name.  I’m impressed.

He called in periodically.

Oh, okay.

And he called in all the time to speak to the Oracle of Orlando.  And it just kind of stuck.  And so I appreciated that and we have since trademarked it.  And it’s now — if you Google Oracle of Orlando, you will unfortunately find me.

Anthony in Apopka.

<Inaudible> speak to the Oracle of Orlando about retirement.

Anthony, once again, I appreciate the moniker and we’ve trademarked it and it’s now registered in the US patent office.  In fact, I don’t know if <Inaudible> the story, when we did that we got some pushback from <Inaudible> I remember that.

Oh no, I remember that.  That was awhile ago.

I think more of Warren Buffett when I think of that.

But, he’s the Oracle of Omaha.

I know he is.

<Inaudible> but Joe Bert is the Oracle of Orlando.  Known as the Triple O.

Well Oracle, what can we call you about today for the audience that may be joining for the first time.

Well, Judy and I are here to take any questions that you might have regarding your personal finances.  As we say, Monday through Friday we do this for a fee, but on Saturday mornings we do it for free.  And unfortunately people approach those retirement years as Judy has talked about in our earlier segment and don’t have any plans.  They really don’t know what they’re going to do with their lives and how to turn maybe those savings and investments that they’ve accumulated The savings and investments that they’ve accumulated in their IRAs or 401ks into a stream of income to supplement their Social Security, and how long will that money last, and what do they need to do now so they don’t look back five or ten years from and say gee, I wish I had known that.  Or gee, I’m sorry I did that.  And those are the toughest cases that we work on.  And that’s what financial planning is all about.  We charge a fee for those services because we’re not there to sell you something.  We’re not trying to sell you another life insurance policy or an annuity or whatever it might be.  We’re here to guide you along the way and to remove that cloud that might be hanging over your head.  Or job is to give you financial peace of mind so when you put your head on the pillow at night, you know that you’re going to be okay if you do this, and this, and that.  Now we can’t guarantee that, but at least we can show you the impact of what’s going on and what decision that you need to make because it’ll give you a high probability of getting there.  Then of course when we do the planning, we do what we call stress test it.  <Inaudible> looks at stress testing <Inaudible> looking at the probability of all of this happening, and we want to be sure that there’s a high probability of you reaching financial success.  So that’s what we do as financial planners, certified financial planner professionals, and as I said we charge a fee for that.  But we’re here now absolutely free.  So pick up the phone and dial these numbers.

844-220-0965.  844-220-0965.  You can also text us a question, 21232.  We self-employed we’ve got a couple of text questions in here.

Yes, and the top one is kind of relevant to some of what Joe just said.

Yeah, well you want to talk about that <Inaudible> okay.  I am 28 years old and currently contributing 15% to my 401k.  How much should I increase to retire at 65?

Well first of all, I commend this young person at 28 years old to be looking and contributing at his 401k or her 401k.  And thinking ahead to age 65, because I can remember when I was in my 20s, I thought if you were 65 you were probably dying, right?

Well <Inaudible> now we’ll talk about that age <Inaudible> psychological <Inaudible>.  Let’s get this question in —

But I think if you’re contributing 15%, that’s pretty significant.  And we’ll make an assumption that some portion of that is being matched by this person’s employer.  So I’m not sure that you necessarily have to increase.  It would be difficult off of the top of our heads to tell you how much you have to save in order to be able to retire at 65, so that’s something we encourage you to contact us.  We’re happy to give you some guidance in that area and perhaps look at your number.  And you know what, we have a workshop that’s What’s Your Number.  So you could come in and just attend the workshop.  You can go online to our website, financialgroup.com, and look at that.  And at 28, I would think perhaps you would look at maybe owning your own home.  There’s some other things that you can do financially that will help you along the way to your retirement goal.

There’s a lot of variables that go into answering that question, because — what’s your lifestyle?  And between 28 and 65, got 37 years.

I want to have three Maseratis.

<Inaudible> well you have clients that might like to do that.  They have to factor all of that stuff in.  But as Judy said, this person is to be commended that number one, they’re using their 401k and they’re putting in 15%.  I can tell you if that they continue to do that they will be in very, very small percentage of people that retire with some security.  Because unfortunately most people don’t think about retirement until they’re in their 40s and sometimes their 50s, and sometimes their 60s.  So this person has a great asset, which is time.  Time is a tremendous asset.  The problem is we don’t appreciate it until it’s gone.  It’s like everything in life, you know.  We don’t enjoy it until it’s gone <Inaudible>.  That’s the way it is.  And as I was saying, here’s what I think is going on right now, why many people are retiring with difficult situations, is because they have not seen anybody — they haven’t seen their parents or perhaps their grandparents struggle in retirement.  I’m talking about the people that are in their 60s, and maybe in their 70s.  They hadn’t seen their parents <Inaudible> because their parents and grandparents did not have the social, the economic environment that we’re living in today.  <Inaudible> they retired, many of them worked for the same company for 30 years, had a pension, had a house paid for, didn’t have to use college expenses, didn’t have the big weddings, didn’t take the big trips.  And they were frugal, and they went through the Depression.  So they saved and they understood.  So these people that are retiring today, my Baby Boom generation is in for a rude awakening.  Because they had not seen what can happen.  Now their kids, if this person — perhaps they’re seeing their mother or father struggle and said my gosh I don’t want that happen to me.  Or seeing younger people in their office today because my generation, the Baby Boomers had screwed it up.

Yeah.  Joe, absolutely.


You see that, you see that it — with some of the younger employees we have here at the radio station.


They’re <Inaudible> I don’t know, I want to make sure I’ve got saving away — I mean savings accounts are going to have no interest rates.  I go yeah you’re right, it’s amazing how well versed and wanting to be informed in those situations.

Yes, yes.  Thank gosh.

But the Baby Boomers — I don’t know the statistic, I was trying to see if I had it.  But the majority I would say — 70% maybe of people who are retiring really don’t have the financial resources to retire and live a lifestyle that they would want to live.

Yes, yes.  Then the important thing is when we do planning we show them if you continue on this lifestyle, you’re going to be eating food <?> tacos when you’re 78 years old.

Yeah, <Inaudible>.

You need to know that when you’re 62 or 63 so you can scale back down.  And they don’t want to do that, right?  I mean, I shouldn’t say that, but many <Inaudible> it’s hard to make a lifestyle adjustment.  Just like dieting.  I mean you’ve got to understand — it’s like going to the doctor for the very first time.  You know you’re not well and you don’t want <Inaudible> but if you don’t go to the doctor and have that doctor prescribe something for you, you don’t <Inaudible>.

Yeah, no I’m done with the sloppy taco <Inaudible>.  That was my college days and I’m gone — no, no, no, no, no.

And I actually have had to recently recommend to a client that they go back to work, and that is really a discouraging thing for somebody to hear.

Part time, or —

You’re going to be better off if you go back to work.  Yeah, part time.

I say this now in my early 30s, but I’m always somebody who just has to have a part-time job.  Just something to do.  So I’ll take — again, I’m sure you have people that go no I want to plan but I also just — I’ll probably work 10 hours as week.

Absolutely <Inaudible>

Just something to do.

Yep, yep.

And we encourage that.

I have a successful business executive CEO, made a lot of money, and when he retired, you know what he wanted to do?  Go to Disney and drive the tram.

Hey.  You know I’ve always said I was going to retire and just be a greeter at Disney, that’s what I was going to do.  844-220-0965, 844-220-0965 is the number to jump in on the conversation if you have a question for Judy or Joe.  Kay in Leesburg has a question.  Kay, go ahead.  You’re on with the Certified Financial Group here on WDBO.

Good morning, Kay.

Hi.  I have a question about US savings bonds.


Probably a <Inaudible>.


I have a mother who died and had a US savings bond in her name.  I believe it’s and/or my sister’s name, and both of them have since died.  I have possession of them.  Is there anything you can do to tell me what to do with them?  There’s probably only $200 or $300 worth of them.

See, the problem —

Well I think you can go to the <Inaudible>

The problem is this is a probate asset.  I mean we’ve got a problem here.

But it’s small.

Yeah, it’s small, sure <Inaudible>

Well there was no — well my mother had a will but that is over and done.  My sister died without a will and technically they were then <Inaudible> my sister’s.  And so I don’t know what to do with them.


I do have a copy of their death certificates.

I don’t know how you transfer that.

Well I think the first thing is they are as Joe indicated a probatable asset, meaning because there’s not a will you have to file with the probate court.  But there is an abbreviated way of doing that when it’s a small amount of money.  So I would encourage you to perhaps contact an estate planning attorney.

But you know the fee to do that is going to be more than the one she’s going to get the $200 from, and —



But you can also go directly to the probate office in the courthouse and they may have a form that you’re going to be able to fill out.  And then you might go online because there is a website for the US savings bonds.  You may be able to ask that question and get an answer as to what is required.  There obviously the death certificate and where you might send it to start the process.  But if you’re talking about that much money, even if —

<Inaudible> $300.

Alright, but you’re going to have to pay taxes the gain on that.  So by the time you’re done paying taxes and running around, I would just <Inaudible>.

Yeah <Inaudible> I do have other US savings bonds, some of them are — there’s only two of them that are technically matured.


And the rest of them have either a 4% or a 1.6% interest on it.

Now are they I bonds?

No, EE.

EE bonds, okay.  Now those will stop paying the interest as well.

<Inaudible> are they in your name, or?

EE <sp?> bonds are something <Inaudible> I’m sorry <Inaudible>, yes.


EE bonds are still paying interest, go ahead.  Yes, go ahead, your question is?

They should be paying interest <Inaudible> 30 years is my understanding.

That’s right, that’s right.

Would I cash in the 1% over the 4% even though the 4% might be matured quicker?

Well do you need the money?


Okay.  Well think of it as an emergency fund.  If you don’t need the money have it sit it there, because when you do cash it in you’ll have to pay taxes on whatever gain that you have on it.  So if you don’t need the money or if you don’t have a better place to invest it with a higher rate of return, then I would leave it where it is and ride it out to maturity.  1% is about what you’ll get in a savings account today or a CD.  So you can think of it kind of as your emergency money, if you will.

Okay.  Is it better to use them over like an annuity or a — which one would I use first, those, or would I use some of my annuity money if I need that?

Well, you’re going to pay less taxes — well first of all, the annuity should be paying more than 1%.  Secondly, when cash in the savings bond you’ll only pay taxes on the gain, whereas any money that you take out of the annuity up until your cost basis can be fully taxable to you.  So I would probably use the savings bonds first.

Oh, very good.  That was very helpful.



Thank you <Inaudible>.

Good luck with that $200, $300 savings bond.  That’s a — yeah, that’s a shame.


But she has to be able to get it in her name and cash it in, but unfortunate it’s probatable.  And I want to clear up something, she said she didn’t have a will.  Well a will doesn’t avoid probate, a will is really what tells the probate judge what to do with your assets so that would go through probate anyway.  But it was be an abbreviate probate.

Right <Inaudible> there’s no will.  <Inaudible>.  I’m not the expert.

Alright, Kay.  Thanks so much for joining us here on the radio show today.  If you would like a line, it’s 844-220-0965.  844-220-0965.  We have been planning tomorrow —


With the Certified Financial Group here on News 965 WDBO.  Time to get the three big things you need to know.

Welcome back, it is the final segment of On the Money with the Certified Financial Group, Joe Berg, Judy Sandborn here live in the studio, taking your phone calls at 844-220-0965.  844-220-0965.  And the text machine is up and running as well, 21232.  Before we got to the three big things, we got a caller, I believe she was from Leesburg, Kay, about savings bonds, and you actually haven’t answered <Inaudible> we didn’t have <Inaudible>.

There’s one thing we hate to do is not have an answer.

Oh no.

<Inaudible> research team this morning has found the answer.

Yeah, Joe Berg and his phone.

With the help of <Inaudible>

Got right on the computer and started digging through his — now he does bring in binders and notebooks here, he has plenty of resources but he <Inaudible>.

You can beat an iPhone.  Here’s what I suggest you do, Kay.  Google this phrase: How do I transfer savings bonds?  And up will pot an answer for you that you have to file form FS-5336 and sign the form in the present of a certifying official as explained on the form, pack up the bond, and send it off to US Treasury along with proof of death.  That will get you started.  So first thing I want you to do is go to Google, how do I transfer a savings bond, and your answer will be found right there.  <Inaudible> saved you a trip down to the courthouse.

<Inaudible> had to be something relatively easy.

There you go, there we go.

Everything else is easy today, why can’t that be?

That’s right.

A couple of texts in here at 21232.  First one: I’m getting ready to retire, I have three properties including my home that are paid off.  I want to liquidate, what’s the best way not to pay a huge tax?

That’s a really hard question without more information.  The text questions are a little bit difficult because we don’t have the interaction with the person who’s asking.

These are what we call phone call questions at 844-220-0965, even though we are running out of time.

But quickly I think the person has to look at what kind of gain they have in these investment properties because whatever they sell they’re going to owe capital gain taxes on that gain.  So if you’re trying to minimize taxes then obviously you wouldn’t sell them all in the same year.  You would spread that out and you would have to look at your other tax liabilities and see how much you’re going to be adding to your tax liability that year.

A way to avoid taxes is to do what’s called a 1031 exchange which might be — but then this person wants to get out of the rental business.  1031 exchange simply allows you to defer the taxes by buying another lifetime property, another investment property.  Doesn’t have to be an apartment if you’re selling an apartment.  It just has to be investment property.  That’s one option.  Option two is they could put it into a charitable trust.  A charitable trust will take that property, sell the property, avoid all of the taxes, and turn it into a lifetime stream of income for you and/or your beneficiaries.  So it’s a way to avoid taxes 100% and get income.  So depending on the situation, there are some alternatives, but without know the details, it’s hard to give you specifics.

<Inaudible> ideas.

Thank you.

Another quick text in here.  I’m retired with 200,000 in a money market account in 0.3% interest.  200,000+ into the 401k, owes 125,000 on the mortgage.  Is at 4.2%, so the question is should I pay <Inaudible> or is there — invest to make enough money to cover payments and make money?  That was a text question, and <Inaudible> — I mean he used his characters very well, <Inaudible>.

He did, right, whoever <Inaudible>

Or she, yes.  Or she, yes.

Alright.  Well I think first of all the consideration would be if you pay off your home, if you’re getting a tax deduction for the interest on your home and that’s beneficial to you, then you might not want to pay off your home.  Depends on how old you are and how close to retirement you are.  And 200,000 in a money market account, I think you’d need to look at is that money that you’re going to need in the short-term or is part of that money perhaps you could invest to your comfort level and something that’s going to pay you more than 3/10 of 1%.  401k, I encourage you to keep doing that.

Here’s what I want that person to do is they pay off that mortgage, is to take that mortgage payment and reinvest it every month to rebuild up that nest egg.  So you’re killing the 4.2% mortgage and sacrificing the 1% you’re getting the savings account, it’s not a bad trade-off.  But I don’t want to give up the liquidity.  So if you have the ability to make that mortgage payment, continue to make that mortgage payment, dollar cost average into a mutual fund and over time you’ll be in great shape.


What do you think?

I think that’s a good alternative.

Alright, there you go.

Alright <Inaudible>.

More information.

<Inaudible> the Certified Financial Group.

Financialgroup.com, our upcoming workshops.  You can find out all you want about there, you can see our smiling faces and make an appointment if you like.  <Inaudible> see you in the office.

Just go by and say hi, they’re great people.  Everybody there is amazing.  Alright, that’s going to do it for this week’s edition of On the Money, we’ll be back here next Saturday, 9:00am with the oracle of Orlando, Joe Berg and another great member of the certified financial planner, the Certified Financial Group.  Stay tuned for the latest news, weather, and traffic right now on News 965

Dictation made on 10/6/2017 5:22 PM EDT.

Hosts: Aaron Bert, CFP®, AIF® and Joe Bert, CFP®, AIF®

Well hello everybody and welcome to another edition of On the Money with the Certified Financial Group.  We’ve got Joe and Aaron Bert here live in the studio taking your phone calls at 844-220-0965.  That’s 844-220-0965.  Good morning, gentlemen.

Good morning.

It seems like a while since we’ve done this.

Been a couple of weeks.

We’ve got the hurricane and I’ve been cleaning up my house from Irma.


How did you guys do in the storm?

We’re here.



No property damage.

<Inaudible> everybody else, a lot of inconvenience, but fortunately no life lost, no limbs lost — well, I shouldn’t say that.  We lost a lot of limbs, but no human limbs.

<Inaudible> a lot of limbs.  Tree limbs.

<Inaudible> tree limbs, and some aggravation but, —

Nothing like —

Perseverance and patience and a bunch of good people, we muddled through.


Yeah, no.  That’s good to hear.  I don’t know how long you guys didn’t have power, but we were out here for a week at the radio station.  I stayed here in the generator powered one studio and then I didn’t get power back until Friday night.

Hopefully — I know you guys didn’t have power at the office for —

I knew everything I ever wanted to know about generators.  I became a generator expert.  Thank heavens we had one, kept the critical systems up and running; phones and computer systems, and we were able to service our clients all week long.  So, we’re glad that’s over.

Well, let’s get back to business here.  What can the audience call you about today?

Once again, Aaron and I are here to take any questions that might be on your mind regarding your personal finances.  As we say, we go through life trying some of this, trying some of that, and wake up at age 55, look at Irma across the kitchen table —

Oh, Irma <Inaudible>

Just popped in my brain.  Look at Irma across the kitchen table and say, well, honey, what are we going to do now? The paycheck is going to stop in a few years and what are we going to live on besides Social Security? And that’s what financial planning, retirement planning is all about.  It’s what we do day in and day out for a fee at Certified Financial Group.  We help people solve those dilemmas, those questions, how to prepare, and what you need to do so you don’t look back 5 or 10 years from now and say gee, I wish I’d have known, or man, I’m sorry I did that.  So, we’re here to answer the questions that might be on your mind regarding any decisions you’re trying to make regarding your IRA, regarding your 401k, regarding mutual funds, regarding life insurance, and reverse mortgages, and annuities, and all that stuff and more.  As we say on Monday through Friday we do it for a fee, but on Saturday morning we are absolutely free.  So, if you have any questions about any of those topics or anything else I might have not mentioned, the good news for you is the lines are absolutely wide open.  So, you can call in, pretend your Daphne, or Jack, or Loretta, or whatever you want to be —

Irma <Inaudible> Maria —

You can use your real name.  Just pretend you’re somebody else.  We’ll be glad to take your call and you can dial these numbers as well as text us.  And those numbers are:

844-220-0965.  That’s 844-220-0965.  Text machine is also up and running as well, 21232.  That’s 21232.  Just keep it to about 160 characters, that’s all we can see on our screen here.  Just wanted to make sure we get all the details.  21232.  Alright, today’s topic, a guide to survivor the Equifax breach.

Yeah, I don’t know if — well, this is something I was — in the news recently, but unfortunately it hit right during the storm and a lot of people, especially here in Central Florida, may have missed the news <Inaudible> cross the wire about what happened with Equifax.  Equifax is one of the three major credit reporting bureaus.  So, when you go into Home Depot or go into your furniture store, or even just apply for a Mastercard online, they go and they check your credit.  And they check it against the data that’s held either at Equifax, or TransUnion, or — I’m missing one.  What’s the other one? <Inaudible> anyway, there’s three major ones.  So, they check your data against what’s held at them.  And those are the companies also that provide your credit score and your credit report.  And so basically they have a lot of sensitive information about everybody for the most part.  I mean, your Social Security number, your account numbers, your date of birth, everything basically financial about you.  And unfortunately, their systems at Equifax specifically were compromised.  I guess it started several months ago and the breach was just discovered, again, a couple weeks ago when the hurricane had been hitting.  So, Equifax has set up a website where you can go online and check to see if your data has been compromised.  But, there are some steps that you ought to be taking to secure your personal financial stuff and we can get to that through the show, but I guess we have a call right now, so.

It’s come to me.  It’s Experian.

Experian, there you go.  So, Equifax, TransUnion, and Experian.  There you go.

Alright, so we’ll get some more information on that coming up.  But, if you do want to join the phone lines, it’s 844-220-0965.  And Michelle in Orlando —

<Inaudible> we do have this on our website, the information we’re going to be covering today.  So, if for some reason you can’t hold on, you can go to our website, financialgroup.com under This Week’s Must Read.  So.


Right in the right hand column.  Financialgroup.com, This Week’s Must Read, everything you need to know about the Equifax breach.

Perfect.  Alright, Michelle in Orlando.  Michelle, you’re on with the Certified Financial Group here on WDBO.

Good morning, Michelle.


Good morning.

How can we help you?

I have a 401k Roth and I wanted to know should I get an IRA as well.

You have a 401k Roth.  Should you get an IRA as well? Well, that depends.  That depends.  You’re looking for a deductible IRA or a Roth IRA?

I’m not sure.


I don’t know the difference.

Okay, first of all, are you with your — how much are you putting into your 401k Roth at work?

The maximum.  I think it’s like 15%.

Okay, 15 — well, it’s not a percentage anymore.  It’s now a dollar amount.  So, if you’re under the age of 50 — if you’re under the age of 50, the maximum you can put in is 18,000.  If you’re over 50, it’s 24,000.  How old are you?


You’re —

I’m 58 — I’ll be 54.

Are you putting —

So yeah, I’m putting the maximum —

Are you putting —

<Inaudible> you’re putting the 24,000 in.  Now the next question is can you do a Roth on top of that? And that’s a function of your income.


So take <Inaudible>

She’s doing a traditional —

She’s doing a Roth 401k.

Roth 401k.

Hold on.

The question is can she do a Roth on top of a —

Or a deductible.


Well, that really depends on your — are you married, Michelle?



Well, what is your income?

Over — about 180.

180, let’s see here.

Yeah, you are not going to be able to do —


— a Roth IRA outside of your 401k.  Now, what you can do if you really want to, do you have an IRA — any IRAs at all outside of —


Okay, you have nothing.  So, you can do what’s called a non-deductible IRA.  So a non-deductible IRA is a traditional IRA that you put in — you can put in your $6,000 and basically you don’t get a tax deduction for that.  But then after you put the money into the non-deductible IRA you can do what’s called a Roth conversion which is where you take that deductible IRA and — non-deductible IRA and convert it into a Roth.  But you know, I would caution you.  With that income level that you’re at with your plan at work, you ought to strongly consider doing the traditional 401k versus the Roth 401k at work just because of the tax deduction that you’re giving up.


Why did you choose the Roth, Michelle? Can we ask?

I have no idea.  I don’t know.  I just picked one.

Okay, I mean as a single tax payer at that income level, you’re in the 28% tax bracket, so you’re giving up a significant tax break in order to be contributing into the Roth.

Especially at $24,000.

You’re giving up about 6,000 or 7,000 — you’re paying about $6,000 or $7,000 more a year in taxes than what you need to because you’re not using the deductible side of your 401k.  So, as Aaron said, I would change your contributions going forward to a deductible 401k as opposed to the Roth to get that tax deduction.



Deductible 401k and then it’s going to be traditional.  So, I’ll just call the employer and just switch it out.

Yes, tell them you want to put your money on a pre-tax basis because you’re giving up a substantial amount in tax deductions.



I’ll do that on Monday.  Thank you.

Oh good, you’re welcome, Michelle.  Thank you for the call.

Okay.  Thanks.


Alright, if you want Michelle’s line, it’s 844-220-0965, 844-220-0965.  Or you can text us, 21232.  We were talking about the Equifax breach before we went to Maria.  There was a caller that just called in there and asked who oversees Equifax and all these credit reporting companies?

Unfortunately, no one.

Yeah, they’re private companies.

Well, they’re public companies.

Public companies.

Publicly traded companies.

Not by the government.

But they’re not regulated and so we entrust them with all this data to do a good job and unfortunately they got hacked just like Bed, Bath & Beyond and Target, and — <Inaudible>

It seems like all of them have been <Inaudible>

This was even a little bit worse though because —

This is terrible.

Well, this was a little bit more personal.

Yeah, well they stole your credit card number, so you could basically just get a new account.  But this is all of your stuff.

All of your personal stuff; your driver’s license information, where you were born, your birth date, where you live.

Well that’s all the stuff that Equifax holds.  But I’m not sure they — and they haven’t come out and said that that’s all the information that they’ve taken, but that’s the potential there which is why it’s extremely important that people take some steps in order to protect themselves.  Equifax has set up a website and I was just trying to look for it where you can go and look to see if you were affected.  But I’ve actually heard some conflicting news about whether or not that it’s actually accurate.  So, I would air on the side of caution and assume that you were included in this Equifax breach.


So, take the appropriate steps in order to protect your financial data, personal financial stuff.

And once again, everything you need to know about this is on our website at financialgroup.com.  Click on This Week’s Must Read and you’ll pull up the article and all the appropriate links to protect you on this because it is a — and the problem with this, Aaron, is that this — somebody has all this — assuming they have all this personal information on you; they know where you were born, they know your birth date, they know your driver’s license number, they know your credit history, where you bank, what you’re — they know everything about you.  And this stuff could linger out there for years and then all of a sudden you get this inquiry that appears to be legitimate.  You forgot about this Equifax breach in four, five years from now, and all of a sudden you’ve been sucked into some scam.  Somebody planted some malware on your computer because you went online and answered some — what you thought were legitimate questions from what you thought was a legitimate website, and now you’re in a pickle.


So, the whole key is to be vigilant.

And unfortunately it just seems like data breaches are going to be a way of life for a long time.

Not only with our personal information but the government’s.  This is what we’re dealing with.  Between Russia, and China, and —

It’s cyber-warfare.

It’s all on the computer.

Yeah, cyber-warfare.  Yup.

The problems of moving forward in a computerized nation.

844-220-0965 is the number to dial in.  Spencer in Orlando.  Spencer, you’re on with the Certified Financial Group here on WDBO.

Good morning, Spencer.

Hey, how’s it going?

Okay, how can we help you?

I’ve got a question.  What’s the big difference between the Roth and traditional.  Like, TSP, 401k.

TSP, that’s the thrift savings plan.


401k can be pre-tax or after tax.  A Roth is always put in with after tax money, but the money under current law comes out tax free.  And that’s the big distinction.  You get a tax deduction for your traditional TSP plan or a 401k plan.  If you put the money on a pre-tax basis, you get an immediate tax deduction.  With a Roth, you get no tax deduction today with the idea that the money will grow for you tax free and under current law it will come out tax free.

What do you mean by tax deduction?

Well, by tax deduction I mean let’s say you put in $1 and you’re in the 25% tax bracket.  Okay, you put $1 in your 401k.  It really only costs you $0.75 because you get an immediate 25% savings on that.  If you put it in with after tax money, otherwise you put the $1 into a Roth whether it’s a Roth 401k or a Roth IRA, you have to gross $1.33 to end up with the $1 to put in the Roth.  Take 25% off $1.33 and you end up with your dollar.  So, if you’re in the reasonably high tax bracket, 25, 28, 39, you definitely want to get that tax deduction today.  Our concern as a firm, my concern <Inaudible> and probably one of the lone wolves out there, lone people crying in the wind about the Roth and the chances are that they may change the law.  I wrote an article several months ago for Kiplinger magazine, it’s still out there on the Internet.  It’s called a Roth, A Wolf in Sheep’s Clothing.  Roth, A Wolf in Sheep’s Clothing, and it will tell you the cons of using a Roth IRA or a Roth 401k for certain people.  But does that answer your question?

Yeah, so let’s say I put 20% and I do 13% for a traditional and 7% for the Roth.  31 and then you retire at 67.  Is it smart to do the 7% for the Roth or should I ease up on that and put it more towards the traditional where —

It all depends on your personal tax bracket.  Are you married?

No.  Single.

Okay, what’s your income?


So, you’re not in that highest tax bracket.  You’re just bumping along here at about — you’re close to 25% tax bracket.  You are in the 25% bracket.  <Inaudible> regular deductions.  You’re in the 25% tax bracket.  I would go full hog on the deductible IRA — Roth, deductible 401k.  That’s what I would do personally.  I like the bird in the hand which is a guaranteed tax deduction today as opposed to a promise that they’re not going to change the tax law somewhere down the road and make my Roth what we call means-tested.  You know what means-tested is, Spencer?


Okay.  Well, let me give you a little history.  Back around 1984, everything up to that point; Social Security — with Social Security was totally tax free.  People could get their Social Security check, they didn’t have to pay a penny tax on it.  And then they made it what’s called means-tested, which says that if your income is over a  certain threshold amount, the government considers you rich and you have to pay taxes on your Social Security up to 85% of your Social Security could be taxed.  My concern is with the government’s insatiable need for tax revenue, somewhere down the road they’re going to see these billions of dollars that have never been taxed in Roth accounts and come up with the same bright scheme.  You know all these people have all this money in there? They can afford to pay some taxes on it.  So, you’re giving up a bird in the hand today, which is the tax deduction, for a promise that the tax laws won’t change.  And I’ve been at this business long enough to know that any time congress is in session, your money is in jeopardy.  Get the bird in the hand today if you’re in a high enough tax bracket and get that tax deduction.  Go on the Internet, read my article; Roth, A Wolf in Sheep’s Clothing, and it will give you some insight as to why a Roth might not be all that it’s cracked up to be.

Give Spencer the website to do that.

Website — our website is financialgroup.com, but the article is just Google Roth, A Wolf in Sheep’s Clothing and the article should come up for you.

He is the oracle of Orlando, Joe Bert, along side Aaron Bert and we are taking your phone calls at 844-220-0965.  Spencer, thank you so much for the call.  We do have to get the three big things you need to know, but right now we are planning tomorrow —

Today —

With the Certified Financial Group here on News 96.5 WDBO.  Information presented on this program is believed to be factual and up to date, but we do not guaranteed its accuracy and it should not be regarded as a complete analysis of the subjects discussed.  Discussions and answers to questions do not involve the rendering of personalized investment advice, but is limited to the dissemination of general information.  A professional advisor should be consulted before implementing any of the options presented.  Certified Advisory Corp is registered as an investment advisor with the SEC and only transacts business in states where it is properly registered or is excluded or exempted from registration requirements.  It is 9:28, toward minutes away from the latest news, weather, and traffic right here on News 96.5 WDBO.  It is a short segment here with the certified financial planners at Certified Financial Group here at News 96.5 WDBO’s Ask the Expert weekend.  Joe Bert, Aaron Bert here taking your phone calls at 844-220-0965.  Before we get to the latest news, weather, and traffic, let’s get to a text question.

Text question.

Alright, I make $100,000 a year, $600 a month into my 401k.  Mortgage is at 4%.  Should I put more into the mortgage and less into the 401k?




That simple.



No? Okay.

Well, first of all, you get 100% tax deduction for the money that you’re putting into the 401k.  He’s only putting in $7,200 a year depending on his age he can go up to 18,000 or 24,000.  Get a clean 100% tax deduction.  He’s got a 4% mortgage and if he’s able to itemize depending on his tax bracket, his effective rate on that is going to be 2.5%, maybe 3%.  That’s cheap money.  And your mortgage is a forced savings account and paying off the mortgage isn’t necessarily a good idea.  Stock money away in the 401k and get that tax deduction <Inaudible>

That’s what I said.

Yeah, but you said no.  I added some texture to it.

Yeah, he said why.  That’s key.

Well, just like that.  You send your text question in, you get an answer.  21232.  Just keep it to about 160 characters.  21232.  We have Stacy and Tony on the line.  Hang on, they’ve got great questions.  I want to make sure you’ve got lots of time to get them answered so we have to pause real quick to get the latest news, weather, and traffic from Dave Wall in the News 96.5 newsroom where we are planning tomorrow —

Today —

With the certified financial planner professionals at the Certified Financial Group, Joe and Aaron Bert here on News 96.5 WDBO.  And welcome back, this is On the Money with the Certified Financial Group here on News 96.5 WDBO’s Ask the Expert weekend.  We are taking your phone calls at 844-220-0965 with Joe Bert and Aaron Bert here live in the studio.  Joe, for the people who just joined us during the latest news, weather, and traffic, what can they call you about?

Aaron and I are here to take the questions that you might have on your mind regarding your personal finances, things that might be bugging you about what’s in my IRA or my 401k, about my insurance, life insurance or reverse mortgages.  I’m looking at an annuity, what should I consider there? Stocks, bonds, mutual funds, real estate, long-term healthcare, IRAs, all that and more we are here to take those questions.  And as I like to say, on Monday through Friday we do financial planning for a fee, but on Saturday morning we do it absolutely free.  So, if you have any questions on any of those topics or anything else that I might not have mentioned, the good news for you, we sill have a couple of lines open and our text line is there as well.  So, <Inaudible> those numbers are:

844-220-0965.  That is the number to dial.  So, Stacy and Tony are on the line.  They’re going to get their question answered here in a minute.  844-220-0965.  Wal have the text machine, 21232.  Just keep it to about 150 characters.  That’s all we can see on our screen here.  We don’t want to get Here on our screen here, we don’t want to get important information left out, so 21232.  And it’s not only here on the radio, you guys have workshops at the Certified Financial Group.

We do.  Today, Gary Abely, CPA and CFP is holding a workshop on financial basics.  This is the good the stuff that <Inaudible> they don’t teach you in school stuff you really need to know.


It is absolutely free, leave your checkbook at home, he’s not going to be trying to sell you some annuity or life insurance product or sell you anything.  But he gives some very, very good information.  It runs about an hour and a half, he’s going to serve some light refreshments and it’ll be held in our big classroom at our office in Altemont Springs, that’s 1111 Douglas Avenue just off of 434 in Altemont Springs.  You can go to our website, that’s financialgroup.com, and find a map right there.  He’s got about five or six <?> seats available to you that I guarantee if you show up you will definitely get a seat.  So that’s once again, 11:00 this morning at our office in Altemont Springs, 1111 Douglas Avenue, get some good information from a certified financial planner professional and a CPA as well.  Gary knows his stuff, and I encourage you to attend.  Maybe I’ll see you there myself.

Yeah, alright.  <Inaudible> enough to be here at 11:00 on my show.  Alright, let’s get back to the phone lines here, talk to Stacy in Orlando.  Stacy, you’re on with the Certified Financial Group on WDBO.

Hi Stacy.


How are you do doing, great.  I’m calling on a follow-up question on that a lady had a few minutes ago about she made 180,000, had a $24,000 a year, put into a Roth?


Okay, question on that whole scenario is in the amount of years she put in that Roth that she paid taxes into, and then she changes that back to a pre-tax deduction, when it comes down to retirement, how are they going to work that?  Does she have any taxes at all with that?

<Inaudible> I’m glad you called because I think you’re a little bit confused there.  We’re not saying that she converts her existing Roth —

Oh, okay.

<Inaudible> just keep the Roth portion as it is, all of that money she put in there, she doesn’t want to go out and do something different with it, keep it as a Roth.  But going forward, she ought to be putting the $24,000 a year and getting a tax deduction going forward.

Oh, okay.  So she keeps it existing <?> but <Inaudible>.

Yes, yes, yes, yes, yes, yes.


I’m glad you called and verified that.  That may have been a little bit confusing, but that’s exactly what I meant even though it may not have come out that way.  So I really appreciate your call, Stacy.

Okay, no problem.  Thanks about that <?>.


Thanks Stacy for the phone call.  If you want Stacy’s line, it’s 844-220-0965.  844-220-0965.  Tony in Avido is up next.  Tony, you’re on with the Certified Financial Group here on WDBO.

Hey Tony.

Good morning gentlemen, how are you all?

Great, Tony what’s up?

I am turning 66 in a few years.  My fiancee lives in Brazil, and we’ve been talking about when I retire me going there and <Inaudible> get married and live there together.  My question is in regards about my retirement plan and my Social Security.


If I have that money sent to Brazil, do I pay taxes on it in the US?


Or would I pay taxes on it in Brazil as well?

You will pay taxes on it in the US.  I cannot speak to what <Inaudible> be in Brazil.

It depends on whether the US has a tax treaty with Brazil, and I don’t know that off the top of my head.  But yeah, most likely you will.  It also depends on whether you’re going to — are you going to stay a citizen of the US, or your goal is to renounce your citizenship or —

No, I’m going to stay a citizen of the US.

Okay, then you have to come back every year as well, so there’s a lot different planning things that go into eventually wanting to retire overseas.  We’re getting this question a lot actually, a lot more people are asking this of us.  And there are some great resources online — have you done any research online?

Not yet.


The place I would start since I saw your call, Carl kind of gave us the heads-up, I went and Googled retiring abroad.  The State Department actually has a pretty extensive website talking about all of the things that you need to consider, and they offer resources from there as well.  So go on Google, type in retiring abroad and the State Department website will actually come up.  You can go in there and use their resources to get some more information.

And there’s another website, internationalliving.com, Tony.  Internationalliving.com will give you some ideas as well.

Okay, so <Inaudible>

It can be done, but you got to keep your head up as to what the ramifications are tax-wise, and as Aaron said about coming back to the United States to maintain your citizenship, so on and so forth.  But happy nuptials to you there in Brazil.

Thank you, I appreciate it.

Alright, Tony <Inaudible> hold onto.

Alright Tony, thanks so much.  If you want Tony’s line, it’s 844-220-0965.  Carl in <Inaudible> is up next.  Carl, you’re on with the Certified Financial Group here on WDBO.

Hi, good morning.  Thanks for having me.

Sure Carl, what’s up?

My question is really on — I’ve recently moved here from the UK and I’ve come across a hurdle <Inaudible> need to get good credit to buy a house.  I have no credit at all and I was wondering if you had any tips to get a good credit rating as quickly as possible.

Ah yes, apply for a credit card and make those payments on a timely basis, that’s the first thing that the credit reporting companies look for is your payment history.  So get them credit and pay it off on a regular, consistent basis.  Don’t make minimum payments, just pay it off every month, and that will begin to establish credit for you.

Thank you.  I heard a rumor that the more credit cards you have, the better or quicker your credit rating increases, is that true?

Well, they use an algorithm in terms of how much credit you have versus what your income is and how much available credit you have and how much you’re using.  So I wouldn’t go crazy with it.  I would get the two major credit cards, I would get an American Express card and a Visa card.  And I would use those cards and make all of the payments every month, and keep your credit clean, and that’s the best way to go.  That would get you started <Inaudible>.  Okay, and welcome to the good ole’ USA.

Thank you.

No problem.

Alright Carl, thanks so much and yeah welcome to the United States.  Let’s go to RJ in Port Orange.  RJ, you’re on with the Certified Financial Group here on WDBO.

Yes, good morning guys.

Good morning, how can we help you?

Due to <Inaudible> circumstances, I had to take Social Security early at the age of 62.  Now with my business, I only make $8,000 a year.  And according to my bookkeeper, I’m only allowed to put in my savings on earned income.  I’ve already maxed out my Roth account, so is there any place else that I can take my Social Security money to make an investment?

Yes, but not tax deductible.  The tax deductible side is only on <Inaudible> yeah, you can only put earned income into retirement accounts.  Now with that <Inaudible> you can — extra money, you can certainly invest on the outside, put it in a mutual fund, and that will allow you to make outside investments, but you can’t put it in a retirement plan.  Retirement plan is only — contributions only based on what your earned income is.

Right, okay, alright thank you very much.

You’re welcome.

Okay, appreciate the call.

Thank you.

Here we go.

Alright, just like that.

Alright RJ.

And the phone lines are open, 844-220-0965.  844-220-0965.

<Inaudible> there’s — we’ve had information on the EquiFax data breach once again on our website, that’s financialgroup.com, financialgroup.com.  Click on this week’s most read, there’s a great link there and all of the other things there you need to know to hopefully prevent some terrible things happening to you regarding your personal information.  Financialgroup.com, Gary Abely once again is having a workshop at our office this morning from 11:00 to about 12:30, going to serve some light refreshments.  Everything that <Inaudible> would have talked to you in school about savings and investing and all of that stuff, good stuff.  He has a couple of — <Inaudible> he has five or six <?> seat open.  Guaranteed, you get a seat, it’s 1111 Douglas Avenue.  Once again, information is on our website, financialgroup.com as well as the map.  You can just drop in and I’m sure he’ll be glad to accommodate you.

Alright, just like that.  Alright, now we’ve got our phone lines in, let’s get back to the text lines, here.

Let’s do it.

You want to get to this top one here: I want to invest 90% Apple stock and 10% in CDs, is that a well-diversified portfolio.  And <Inaudible> by the giggles, that maybe not.  The new phone is amazing, about $275,000.  That’s what the text reads at 21232.

Well if that’s the only thing that you — that’s crazy.

That’s not diversified, I wouldn’t say.

No, no no.  What you’re doing is you’re betting the ranch on one company.  I mean, can you say Enron?

<Inaudible> Enron, I mean <Inaudible>.  I mean yeah.  Well, yeah.

But —

It’s extremely <Inaudible> type of approach.

Extremely aggressive.  I mean Apple has done well, there’s no question about it — I mean there’s — who knows if it’s going to continue to do well.  Any time you invest in any one company, I don’t care what the company is, it’s a high risk, high reward proposition.  It’s like walking to the casino and you see black coming up consistently and so you decide to put all of your money on black only to have red come up on the next spin of the wheel.  Do not do it.  Unless you just want to take a — it’s a high risk, high reward proposition.

If you were the texter, what would you do?

<Inaudible> first of all, they’re going about it the wrong way.  Let’s back up.  Why in the world do we even invest money?  Why do we do it?  We do it to get our money to grow so somewhere down the road we’ll be able to draw from that as our source of income to supplement Social Security and whatever else we have.  That’s why we do it.  So what you want to do is to have a high probability of having the amount of money piled up somewhere down the road that you’re going to need.  And what you want to do is look at how much — most people go into the investment world not having any clue as to what they’re doing.  All they know is they want to make a lot of money.  This is what this is indicative.  I want to get the jackpot, I want to get the <Inaudible>

Don’t we all?

At least he’s got 10% in CDs.

Ah yeah, right, right.  No.


CDs aren’t the greatest options these days either.

This is how we’re totally difference from virtually everybody else that’s out there that wants to sell you something or wants to invest your money.  We look at it from a planning perspective first and foremost.  How conservatively can you invest the money you have today, and the money that you’re going to be earning in the future and still have a high probability of not running out of money when you’re 95 years old.  That’s what planning is all about.  That’s why we charge as fee for what we do.  We’re not trying to sell you something other than our services.  And everybody wants the — these money magazines, it’s their brother-in-law, get tips on the internet, see Apple stock going up, they have no idea — you’ve got focus on number one, what’s you’re number one objective and that’s having a pile of money that you can draw from somewhere when the paycheck stops that’ll carry you through your lifetime.  And how conservatively can you invest your money and still have a high probability of making it.  And unfortunately, most people chase their tails, try some of this, try some of that, wake up when they’re 55 years old only to find they have <Inaudible> and a financial <Inaudible>.  That’s why you want to talk to a certified financial planner professional.  That’s what we do day in and day out at the Certified Financial Group.  If you want more information, go to our website, that’s financialgroup.com.  If I sound like I’m preaching I am because I see the impact that this has on people’s lives, and I can see the disasters that sometimes walk into our office simply because they’ve done what this individual wants to do.  Bet the ranch, and it goes well for a while only to end up breaking the leg and starting all over.

Alright, that’s it.

<Inaudible> not going to <Inaudible> then I said it myself.

That’s it.  Yeah he did.  844-220-0965.  844-220-0965.  Kim in Port Orange is on the line, but Kim we are up against a break here so I want to ask you to hang on, we’ll get to you on the other side.  If anybody wants to join her, 844-220-0965, or text 21232.  Again, Gary Abely’s got a workshop today coming up at 11:00.

<Inaudible> he’ll cover some of this stuff in the workshops.  <Inaudible> more of what I just said.  Gary is great, is a great teacher.  Show up, 1111 Douglas Avenue, go on our website financialgroup.com and you can get all of the information you want.

Financialgroup.com.  Alright, just like that.  We have been planning tomorrow —


With the certified financial planning professionals, the Certified Financial Group Joe and Aaron Bert here on News 965 WDBO.  Time to get the three big things you need to know.

It is the final segment of On the Money with the Certified Financial Group here on News 965 WDBO, Joe and Aaron Bert on mic three and four ready to answer those questions here, so let’s get right back to the phone calls.  Let’s talk to Kim in Port Orange.  Kim, good morning.  You’re on with the Certified Financial Group here on WDBO.

Good morning, Kim.

Hi there.  I am 2016 <?>, only make earned income from work of about $1,500.  I made the mistake of putting 6,500 into an IRA, so through my tax lady I found out I was being fined by the IRS.  It’s only in a 20% <?> paying CD that other $5,000.  I’m 50 — turning 59 next month.  I heard — I’ve understood possibly at 59, I can start taking that out because it’s just going to <Inaudible>.  She said I’ll be fined every year, what are your thoughts on that?

Why don’t you just cash it out?  Just take it out of there instead of subjecting yourself to the potential annual fine?

Will I be fined <Inaudible> 10% <Inaudible>?

No, no not —

If I take that at —

No, not on the over contribution, they’re not going to fine you.  In fact, they’re going to fine you if you keep the over contribution in there.

Oh, okay.  So I can go ahead and just cash that out today <Inaudible> today.

Sure, yes, yes.  Yeah, clean that up.  That’s where your problem is, is you over contributed to something you should not — your tax person should have told you that.

Yeah, well — okay, alright, thank you so much.  I’ll cash it out.

You’re welcome Kim, you’re quite welcome.

Thank you, bye-bye.

Alright Kim, Port Orange, thank you so much.  Just like that.  So <Inaudible> you don’t get penalized for the overage.

No, no they want you to clean that up because — yeah, yeah.  So just take out the overage and <Inaudible> should have <Inaudible>

Well thank you for cleaning that up oracle, I appreciate that.  <Inaudible> Get back to the texts.  Texts are right to the 21232.  If I know I will inherit $100,000 this year, is there something I should do to prepare for this inheritance?  My house is paid off and I’m maxing out — well, that’s where we cut it off there.  It’s 160 characters, that’s why we <Inaudible> yeah.

Problem maxing out the 401k.

That’s it.

Let’s be sure we understand what maxing out is because people have a misconception about that.

Yeah, we hear that a lot actually.  People come into our office asking about their 401k and we go how much you’re contributing?  Oh, I’m maxing it out.  Oh really?  How much are you putting in?  I’m putting in 5%.  Well, 5% of their salary isn’t max — a lot of people think that maxing it out is just getting up to the maximum match <Inaudible>

Contributions dollars <Inaudible>

From their employer.  So really maxing out means if you’re under the age 50, $18,000.  If you’re over the age of 50, $24,000.  That’s the true maxing out of your 401k plan.  So if he is truly maxing out his 401k plan and his house is paid off or her home, we don’t know if this is a he or she.  There’s a lot of different things that you could to prepare.  First question I would have, are you married?  If you’re married, is your spouse also maxing out their 401k if they have one if they’re working?  Are you able to put more money into an IRA depending on your income?  There’s — do you have any debt?  The house is paid off, yeah.  Do you have credit cards?  What about car loans?  A lot of people don’t include car loans as debt.  So there’s different things that you can look at.  This is a perfect example of someone needing to come in and do some planning.  It depends on the age of the person.  Are they 30 years old or are they 70 years old.  There’s a lot of different factors that go into there.  $100,000 is a lot of money to come into, and if you prepare yourself correctly and maybe do something planning, that’s what you really ought to do to prepare, do some planning.  You can invest that money appropriately and that will greatly enhance your success for retirement when that time comes.

So when that money comes to you, it probably comes to you totally tax-free so you don’t have to worry about paying and estate taxes or inheritance taxes on it.

That’s good.

And Aaron mentioned the fact that if you’re married and your spouse has a 401k, you can’t take that $100,000 and dump it in that spouse’s 401k.  But what you can do is have your spouse max out let’s say the $24,000.  And instead of the $24,000 that your spouse will be bringing home over a period of four years, that’s 96,000 for four years, you tap into that $100,000 that you have sitting there in a savings account.  And that gets — it makes that $100,000 then tax deductible.  So it’s all planned.  And that’s what we do day in and day out for our clients.

Alright.  That’s about it.  We’ve got about a minute left here.  Do we have one more — real quick question, why is the 401k tax deductible?

That’s the law.  The law says that you — it doesn’t include — show up in your taxable income.  So basically you’re getting a clean tax deduction.  So when you get your W-2, you have gross income, taxable income, the difference usually is your 401k.

You can take a tax deduction on your 1040 but it just shows up as less income on your W-2 there in essence, tax deductible.

Alright, well <Inaudible> about going to do it for today’s episode of On the Money.  Just real quick, Gary Abely’s workshop.

<Inaudible> workshop at our office at 1111 Douglas Avenue, starts at 11:00.  Go to our website, financialgroup.com.  Click on workshops.  Everything you want to know, and you can also get the information on the EquiFax breach.  Financialgroup.com, this weeks must read.

Alright, that’s going to do it.  Thank you so much for listening On the Money.  Stay tuned for Florida Homes and Gardens right here on News 965 WDBO.

Dictation made on 9/28/2017 2:17 PM EDT.

Hosts: Denise Kovach, CFP®, AIF® and Joe Bert, CFP®, AIF®

Hello everybody and welcome to another edition of On the Money, with the Certified Financial Group, here on News 96.5, WDBO. We are taking your phone calls at 844-220-0965 with Joe Bert and Denise Kovach! Good morning, everyone.

Good morning!

How are you guys today?

Doing great, how are you?

Trying to stay dry and avoid the rain, it’s going to be a wet Saturday.

It’s cool out there this morning, it’s nice, it’s pleasant.

The silver lining to the cloud, that is Joe Bert, your oracle.

A whole lot happened and here we are.

Joe, what can the audience call you about today?

Denise and I are here to answer any questions that might be on your mind regarding your personal finances. As we say, we go through life trying some of this, trying some of that, wake up at age 55 and find out we really need to get our act together and that’s what Denise and I and the other certified financial planner professionals do every day day in and day out for a fee but on Saturday morning we are here for free so if you have any questions regarding your personal finances as they relate to decisions you might have to make about your 401(k), about a mortgage, about stocks and bonds and mutual funds and real estate and long-term health care and IRAs and annuities and reverse mortgages and all that kind of stuff, we are here to take your calls and you don’t even have to use your name. You can pick up the phone and dial these numbers and pretend that you’re Jack or Daphne or Loretta or anybody and we’ll take your call.

All right, just like that!

If you have any questions pick up the phone and dial– what are the numbers?

844-220-0965, 844-220-0965. The text machine is up and running as well, 21232. Just keep it to about 160 characters that’s all we can see on our screen. 21232. Denise Kovach is here, starting off with today’s topic, long-term care insurance if it’s something I need.

Well as you probably know– excuse me, I’m starting to lose my voice already, not a good thing.

Yeah, four words in, not good.

We’re living longer due to health care innovations which is the good news. However, the bad news is that at least 70% of the people over the age 65 will require long-term care services at some point.

Let me give you that number again, 70% of the people over age 65 are going to spend some time needing long-term health care.

And by long-term health care what do you mean there? That’s not just being in the hospital, that means what?

You could have needs for assisted living at home, so home health care. You could be an assisted living facility, which you’re somewhat independent but you’re getting services if you need it, there’s skilled nursing, so that’s a nursing facility, and of course they graduate and so do the prices. So having said that people are often confused that Medicare and private health insurance programs pay for these services but they don’t. Long-term care costs thousands of dollars per month with the average stay being three years. I’m currently looking at an assisted living facility for my mom. A $4,000 down payment is required and the cost of a small one bedroom apartment is just under $4,000 per month plus depending on the level of assistance she’s going to need there’s an additional $700 to $1,700 a month that’s going to be charged on top of that, so what if she wanted a semi-private room, not private, just a semi-private room in a nursing home facility? It just got more expensive and according to Genworth that monthly cost averaged $6,800 in 2016. That was just last year, so —

$80,000 a year.

That’s expensive.

It is expensive.

And that’s average. The most common reasons people require long-term care are dementia, you know, Alzheimer’s, like that–

I got it. I mean, I don’t have it but I understand what you’re saying.

I’m glad you <Inaudible>

You don’t have dementia? I don’t remember.

I hope you have long-term care insurance.

I do. I’m covered.

But dementia, cancer, and stroke. When my dad was alive he was in an assisted living facility because he had dementia. My mom is needing assistance because she has cancer and is fragile. The costs associated with long-term care are high; Medicare will only pay for skilled services or–


Thank you, I needed that. Care in a nursing home for 100 days. Health insurance will pay for some health care service costs but only for specific circumstances and for a very limited time. Medicaid may pay for it but only if you have limited assets and income. Long-term care insurance is a way to cover these costs so what’s available? You can opt to buy a long-term care insurance that you pay for like an automobile policy but if you don’t use it you lose it and premiums can increase over time. Other options include paying a lump sum amount to purchase coverage that will never increase in price, and if you don’t use it it remains a part of your estate. I’m often asked, when is it appropriate, when is it– bleh, I’m having issues today.

Ha ha ha!

Maybe I’m not–

Are you ready for the home? Do you need some more coffee?

Exactly, maybe I need an assisted living– When is it the appropriate time to buy long-term care insurance? I hear that a lot so there’s not a set age at which it is best, however its cost is generally increased with each year that you’re older so you may consider buying it when you’re younger, healthier, and more likely to be approved for coverage. Long-term care costs can easily wipe out your retirement nest egg. If you’re getting older now’s the time to take the step to protect the assets you’ve spent your entire life accumulating and start looking into the appropriate coverage for you.

It is something to consider, there’s no question about it, no question about it. Thank you for your input on that. I’ve got something more I want to add to that but we’ve got some callers here, we’re going to keep them on the line–

Yeah, absolutely. Well, let’s open our phone lines here, 844-220-0965, 844-220-0965. Let’s start off with Mike in Orlando. Mike you’re on with the Certified Financial Group here on WBDO.

Good morning!

Well, thanks for taking my call.

Thank you for calling. How can we help you?

I want to ask you about individual municipal bonds.


Who should own them? Are they better than bond funds during periods of rising interest rates, and what is laddering?

Okay good questions. Let’s talk about laddering first. Laddering you can do with any kind of fixed income security or investment including CDs or bonds, which means you buy them at differing maturities and as the one that matures when the one matures– Let me back up.

I’m sorry, it’s spreading to you.

Ha ha ha!

Which means–

You guys stay over there, I don’t want to get it today.

Just to make the illustration easy you have five different maturities, one year two year three year four year five year, and when the one year maturity matures you take that one and you wrap that into the net– you go out and buy another five year one because you have the one that’s going to mature in two years, mature in two years and you just keep rolling them. That’s what laddering means. So in a rising interest rate environment that’s not a bad thing to do. You follow where I’m coming from here.

Yes. Right. Right.

Well you don’t sound confident.

No, I understand what you’re talking about, laddering. Yeah.

So the next question you had was individual bond bonds–


Individual muni bonds.

Yeah. When you buy an individual security you need to know what you’re doing. It’s not just that it’s issued by somebody whose name you’re familiar with, you need to understand the credit rating, you need to understand what backs it up as it was called a general obligation bond which means it’s backed by the full faith and credit of the county or the city that’s issuing them or is it what’s called a revenue bond which means that it’s issued and the revenue from a certain source like the turnpike, you know, turnpike bonds were sold and the revenue from the turnpike can only be used to pay off the turnpike bonds.


So that’s how individual bonds are done. Now the nice thing about those is that you hold them to maturity, and you’re sure– well, I can’t say you’re sure but depending on the creditworthiness of the issuer you’ll get your money back. Right? The problem with that is, is you’re — you have your money. Unless you have a lot of money to spread around and a lot of bonds, most people are better off turning it over to a professional using a mutual fund, right, Denise? I would do that because you own more than one bond, which reduces the risk exposure to you. So you own hundreds of bonds. And you’re–

What you’re doing there is have professional managers select those bonds for you. Now you have insured bond funds, where the only kinds of bonds they will buy are insured. You have those, what are called high yield, which means that that man will take you a little bit more risk to get you a little bit higher yield and then the– here’s the thing about bonds and bond funds. A lot of people say well I don’t want to own a bond fund, interest rates go up and the value of the bonds are going to go down, let me tell you my chicken and egg story. You ever heard my chicken and egg story, Denise?

I think I’m getting ready to.

Okay here you go.

When I look at bonds or bond funds I look at the income that you get from the bonds as the egg. Okay? That egg is going to come in on a regular basis and you’re going to spend it and cook it and eat it. The bond itself is the chicken and in a rising interest rate environment that chicken is going to get skinny because the value of that bond will go down. It’s true for bond funds, it’s true for individual bonds. But if you’re investing in bond funds for income forget what the chicken looks like because the eggs will generally be there. And in a bond fund what you’re going to do is you’re going to take that income and either spend it or if you’re in an accumulation phase you’re going to take the income and reinvest it. Now the good news in a rising interest rate environment when the value of the bonds in the bond fund are going down you’re actually buying more shares because the price is cheaper so the amount of income that you’re ultimately going to get is the function of how many shares that you own so if you’re reinvesting in a high interest rate environment you’re buying more shares at a cheaper price to get more income down the road. So I like to use bond funds. I own them, we recommend them for our clients. We generally don’t recommend buying individual bonds and/or individual stocks, what do you want to add to that?

Well, what I want to add to that, Mike, is obviously when you own municipal bonds whether they are individual or in a mutual fund. They are better held outside of any type of IRA or retirement account because the yields are typically lower. However, on a– they’re not taxable. So the tax equivalent yield is higher in that regard if that makes sense. Right Joe?

That’s right.


Does that help you, Mike?


Lot of information.

Anything else you want to know while we gotcha?

Well I’m having to pay my RMD for the first time next year and I was just concerned if I had too many bond funds would the interest rates go up, I’ve got to start taking money out of my RMDs so I was just– I was just interested in if it had rising interest rates how that would impact my withdrawals through the years.

Rising interest rates, as you withdraw via the bonds are in your IRA account.


They’re not municipal bonds, I’m sure.

Yeah, they’re just bond funds.

Bond funds, okay. Yeah, in a rising interest rate environment the value of those bonds will be gradually decreasing. Now there’s a way to mitigate that and that’s in owning the right kind of bond funds and you want to have bonds generally in your portfolio because we call them the shock absorbers in a portfolio. When you have that market correction generally when stocks go down bonds go up so you’re not really getting impacted by the big drop in the stock market, except in a situation like 2008, 2009, when the bond market and stock market throws up simultaneously but in my mind and Denise’s mind it was a once in a lifetime occurrence so we’ll think about it.


All right?

All right. Well, thank you.

Thanks for calling, Mike!

All right, Mike, thanks so much. If you want Mike’s line it’s 844-220-0965. 844-220-0965. We are about a minute away from the three big things you need to know so Debra in Longwood, hang on the line, you’re going to be first up when we come back but right now we are planning tomorrow–


With the Certified Planning Professionals at Certified Financial Group, here on News 96.5, WDBO.

Welcome back, this is On the Money with the Certified Financial Group, here on News 96.5, WDBO. We are taking your phone calls at 844-220-0965, that’s 844-220-0965. We are five minutes away from latest news, weather, and traffic, so let’s get back to our phone lines. Debra, in Longwood, Debra, you’re on with Joe Bert and Denise Kovach from the Certified Financial Group. Good morning, Debra.

Good morning and thank you for taking my call.

Sure, how can we help you?

I have a quick question. I’m 69 years old, I was wondering what the tax implication is taking $10,000 out of my IRA or incidental expenses that I did not foresee coming this year.

So you’re 69, you said?

I am 69, correct.

Debra, what you’re going to have to do is add that figure onto your ordinary income and you’ll pay your income taxes on that. There’s no penalties because you’re beyond 59 and a half, so you’re just looking at taxes.

So really though it’s no difference between taking it now and taking it when I’m like 70 and a half. Is there a difference, what’s the difference regarding tax implications because those are taxable income, correct?

Correct. There’s no difference.

There is really no difference. Okay, good enough.

At age — Let me back up here.

Go ahead.

If you don’t need it now, at age 70 and a half you have to take it out and you’ll have to —

I understand.

So even if you take money out now at age 70 and a half you’ll still have to take out money, so if you can use the money that you take out now maybe you wait until 70 and a half and don’t have to pay as much on taxes.

Oh perfect. Okay. That’s all I needed. Thank you guys, thank you.

Thank you very much.

We didn’t stutter on that one, did we?

No not yet. It’s early give us time.

Yeah, I saw you get more coffee during the break there. 844-220-0965 is the number to call up a certified financial planner, Certified Financial Group, 844-220-0965. Text is 21232. And we got a text question in here, guys: Is a 457 plan subject to the RMD at 70 and a half RMD is required minimum distribution at 70 and a half?

It is if you’re no longer working for that company. If you’re still working for that company it is not as long as you’re not a 5% shareholder.

Okay. Most people, seems simple enough.

But let me say something, if you do need to take a mandatory distribution because you’re not working for that company and you have IRAs you cannot take a mandatory distribution representing the pooled amount. There’s separate entities, qualified plans versus IRAs. The RMDs must be taken individually from each respective account.


If it’s a 401(k), the same thing.


403(b) the same thing.

Okay. Great. Simple enough.

I want to circle back to what Denise was talking about —

I want to say if you want to circle back–

Did want to circle back. Here we go. Circling around. We’re talking about long-term health care or nursing homes and so on and so forth, one of the things that we’ve come to learn is that if you are considering for yourself or a loved one moving into — the first step is using what we call independent living.


It’s where you no longer want the big house, you’re tired of the lawn and the maintenance and you just want a nice apartment where they have meals every day in the wonderful dining room and they have the activities and you’re with people of your age and they get on the bus and– that’s independent living. You pay for that and it’s like an apartment, right, but you’re with your peers. Then what happens is as your health deteriorates then you need what’s called assisted living, where you can no longer maybe bathe yourself, clothe yourself, toilet yourself, take medications. You need help getting up in the morning, getting out of the bed, you know, whatever it is, that’s assisted living. And then you may move into maybe what’s the next level is memory care. This is what happens to a lot of people. You know, the dementia sets in and you– it’s memory care. And we’ve seen that time and time again with our clients and parents and loved ones and then you have the skilled nursing home where you’re in the bed and they have the tubes in your nose. What you want to have, ladies and gentlemen, if you’re thinking about making this transition in life is a facility that you look at, be sure that they have all levels of care. If you like that facility what you don’t want to do is uproot Mom or Dad, when they can no longer stay in the independent living side, right?

Correct. And then you have to yank ’em out, you know without any notice, and find them another place to live at perhaps the worst time in their life.

And even provide hospice care. I mean, end of life care needs to be there as well. It’s very important.

So if you’re thinking of making that move, consider looking at something that has all stages of care because life being what it is, chances are you will progress through those life stages and what you don’t want to do is pick up Mom and Dad, because they have to move because the facility that you’re in that they’ve become accustomed to, where they have their friends and family and whatever they have to move because that facility won’t accept them anymore because they need that next level of care.

The change is extremely difficult for them.

The older you are, the tougher it gets. Just ask me.

There you are.

How tough does it get, Joe? No <Inaudible> 844-220-0965 is the number to dial us up if you got a question for the panel today, 844-220-0965 and we also have that text machine up and running. Good old Texty. 21232 is the number to reach us here. Please keep it to about 160 characters, that’s all we can see on our screen, 21232. <Inaudible> an update on what’s going on over there on the Texas coast with Hurricane Harvey and Dave Wahl, <Inaudible> news, weather, or traffic, right here on News 96.5, WDBO.

Hey welcome back! This is On the Money with the Certified Financial Group, here on News 96.5, WDBO, hope you’re driving safe out there in the rain. Please please drive safely in the rain, it is raining the forecast all today but you just heard the weather forecaster <Inaudible> Deion in Severe Weather Center so we’ll keep you updated throughout the day. For right now we are here with the Certified Financial Group taking your phone calls at 844-220-0965. Joe Bert and Denise Kovach are here with some great information today. Again, 844-220-0965. We have a text question in, guys, to kick this segment off. Actually it’s Gary Avely, look at that, Gary Avely–

–you also recommend an independent review of their financials at the facility.



Yes, not a bad idea, so Gary texted in, here.

I’m looking at that.

Gary, our–

While we’re on Gary, he’s got a workshop coming up.

He does. And let me tell you a little bit about that. It’s coming up on — It’s–

September 14, right?

No, it’s September 16.

September 16.

Two days off. We’re having issues, Joe. Anyway, Gary’s going to be talking about the financial basics and basically life strategies for success, it’s going to be held in our office on Saturday, September 16, and it’s going to be from 11:00 to 1:00pm, light refreshments will be served so come on out if you’d like to learn about some life strategies for financial success, with Gary Avely in our office.

This is always a very popular workshop; Gary does a great job. Gary is a frustrated educator. He loves teaching. He loves teaching and the nice thing about Gary is he takes a subject that You would think might be complicated and he breaks it down so grade schoolers could understand.

Well, I would say high schoolers could understand it.

High school is —

Which is good!

Which is great, which is terrific, which is terrific.  Your brain doesn’t fry up.  He gives you good information, it’s absolutely free.  The reason we do this, folks, is two reasons.  Number one, to show you stuff that you need to do now so you don’t become a financial casualty.  Secondly, to introduce you to our firm, what we do as fee-based planners and how we charge our clients, and get you — whether we need planning now or sometimes in the future, you’ll give us an opportunity to earn your business.


Come on by.  You can go to our website, that’s financialgroup.com, financialgroup.com.  Click on workshops, you can make a reservation right there.

And we’ll go through that calendar again coming up later in the show, but let’s get back to our phone calls here.  Talk to Peter.  Peter, you’re on with the Certified Financial Group here on WDBO.


Good morning.

Good morning.  My question is, my wife was involved in a pretty bad car accident a while ago and she just received a very high settlement.  So we put it in the bank until we know exactly what we’re going to do with it.  But what we’re wondering is, is it okay to pay off the mortgage on our home?  We still owe 260,000 and we were thinking of just paying it off.  But then my follow-up question is, if we do pay it off, what do we do with those payments that we’re making right now?

Well first of all Peter, I’m sorry to hear about your wife and I’m hoping that she’s okay.  So they you a —

Oh, she is.

Good.  Good.  Did they give you a lump sum?  This is not a structured settlement?

No, this was one lump sum.

Okay.  Can you tell me how much that was?

It was over 1M.

Okay, and your mortgage is 200 and —



60, right.  260.

What’s your interest rate on the mortgage?


Are you benefiting from a tax deduction with that?


So you’re not itemizing, you’re not taking the interest deduction on your tax return?

That’s a no-brainer, I would pay off that house.  Then I would take the funds, if you don’t need those funds perhaps, and are you still working?

Well I’m a disabled veteran, I lost both my legs in Vietnam.  And we’re pretty well set.  That’s why I wanted to pay off the mortgage, get that off of our heads, and take that money that we’re using now, which is about 1,900 a month, and invest it into something.

Okay.  Here’s the challenge that you have, Peter.  Right now, you know you have to make that mortgage payment every month, right?  And you write that check —


Because you don’t want to lose your house and that’s probably one of the first things that you pay because it’s important.

It is.

Alright.  Unfortunately, human nature being what it is, that $1,900 is going to come and it’s going to go and it’s going to slip through your fingers.  Unless you set yourself up on a systematic, disciplined approach to every month invest that money month in and month out.  Because what happens, I’ve seen this time and time again because we’re all human, you have that extra $1,900 in your checking account and we always find a place to use it or give it to somebody or somehow spend it.  Right now, you’re making that mortgage payment you know you need to make it.  When it comes a payment that you have to make to yourself, unfortunately human nature takes over and one month it’s there, next month it’s not there.


So psychologically, it might be best for you, financially it might not be the best.  What you really should have done is have a plan done.

Oh, absolutely.  That’s a given, Peter.  Instead of just asking questions here and there, is have somebody, a certified financial planner, perhaps one of us at CFG, to take a look at your overall situation and walk through the different options available for you and your wife in order to maximize your retirement savings.  And to work with you on systematically investing that $1,900.  Instead of writing a check for $1,900, you can easily have that just boom, taken out of your checking account once a month and automatically invested.  Which is a great help to offset what Joe was talking about.

Peter, how old are you?

Right.  68.

And your wife?

She’s 58.

58, okay.  Assuming her accident did not give her long-term medical issues, when we do planning we’ve got to look at about 35 years for your wife in life expectancy.  That is a long time.  So, what you need to do is actually do some planning.  You have gotten a windfall we’ll call it.  Unfortunately your wife had to have an experience to get that.


But you have an opportunity to lay a foundation where you and your wife will not have to worry the rest of your life if you planned properly.  Unfortunately, what most people do, you’re going to do the thing that we’ve all be taught to do.  Pay off the house, then you take the money and you stuff it in the bank.  Then as time goes on, what’s going to happen is you’re going to start eating into that principal because the principal isn’t growing fast enough to keep up with the increasing cost of gasoline, groceries, electricity and all that other stuff that you want to do over the next 25, 30 years.  Plan is what will work for you, what that will tell you is how conservatively you can invest that money and still have a high probability of your wife not running out of money when she’s 90 years old.  So whether you work with us or another certified financial planner in Central Florida, that’s what I would suggest you do.  You want to work with somebody that’s going to charge you a fee to do that.  Don’t go somewhere where they say they’re going to do the plan for free, they’re going to give it away, come in, I’ll do a plan for you.  Because they’re trying to sell you something.  When we do it a Certified Financial Group, we do it in detail, we design something specifically for you.  The cost is a lot less.  I hear this time and time again where people expect it’s going to be, but the idea is to just give you peace of mind.  Like I said, whether you work with us or anybody else in Central Florida, you and your wife should have a plan.  I appreciate your call, Peter.

Thank you.

Thank you so much guys.  Good day.  Bye bye.

Alright, thanks so much.  If want Peter’s line, it’s 844-220-0965.  That’s 844-220-0965.  Joann in Orlando has a comment about the long-term care insurance.  Joann, go ahead.  You’re one with Certified Financial Group on WDBO.  <sp?>

Good morning, Joe.

Good morning!

I’m a client of yours and I just wanted to make a comment on long-term care.


I’m 59 years old and I’ve had long-term care insurance with Genworth.  I know it’s very — there’s lots of other companies out there.  Like I said, I’ve been there for 15 years I’ve had them.  I had an unfortunate accident this spring at my house.  I fell and I broke my leg and fractured my hip.  So I went to the hospital, went through rehab and everything else and I exhausted all my primary care and deductibles and everything.  I still needed rehab and was sent to an assisted living facility for just the rested <?> short care.  Genworth picked up the entire bill.  I was quite young at that time, and I’d say anybody, go get the insurance.  It’s well worth the money even if you never use it.

Well, it’s like insurance, you know, we never want to —

Any insurance.

You never want to pay the premium —


Until you smell the smoke and the house is burning down.


And then you’re glad you have it.

Yep. yep.  I don’t know, there’s so many companies out there, but not a plug for Genworth, but they are top notch.  You get to talk to people that know what they’re talking about and they talk in a language you can understand.  You know.

Well I appreciate the call and I’m glad — you’re home now, right?

Yeah, I’m at home now.  Very cautious about my living conditions here.  But you learn to appreciate your health in a hurry.

No joke <?> about that.

I appreciate your call very much.

Yeah thanks so much, Joann.  For the record, that’s what we call a plug.


844-220-0965.  844-220-0965.  You want to jump in on the conversation.  George in Orlando!  George, you’re on with the Certified Financial group here on WDBO.

Good morning, George.


Morning, guys.  How are you?  By the way I know that company from the last caller is great, great company to be with.  Anyway.  Reverse mortgage, 60 years of age, do you recommend it?

You’re not eligible until you’re 62, George.

62?  That would make the trick.  So you can only apply at 62 years for it?

That’s correct under the current guidelines A62.  While we’re on that, unfortunately reverse mortgages have gotten themselves a bad name over the years.

Unfortunately, they have.

The reason being is because people oftentimes — not oftentimes, but on some occasions, they will strip out all the equity out of their home, they will get this big lump sum of money, and what they will do is they end up blowing it.  They go on vacations and buy the cars and give money to their kids and yadda, yadda, yadda.  All this money was in their equity, they just blew all the equity in their home, and then they don’t have enough income to pay the property’s taxes and insurance, which you still have to do under any circumstances, and they end up losing their home.  That’s the worst thing that you can do with a reserve mortgage.  There have been some recent articles written in the financial planning journals about using a reverse mortgage as a safety net for you to draw from when that inevitable correction comes and your investments are down.  What you do is you turn on the valve on the reverse mortgage and you draw a little bit from the reverse mortgage and wait until the market heals and turns itself back on around, then you turn off the reverse mortgage and you continue drawing from yours accounts.  It’s been statistically proven, it’s been factually proven that it’s a very, very powerful tool if used correctly.  Unfortunately, most people don’t use it correctly.  So, if you want more information about that, I’d be glad to send you an article that was written in financial planning journal, just contact me, joe@financialgroup.com.  We don’t sell reverse mortgages, we don’t do reverse mortgages, but we do know the power of them if they’re used correctly.

And one of the benefits is if you think about it, if your income level is at a point where your Medicare premium costs are high, if you take from the reverse mortgage, that’s not taxable.  So it could reduce that premium cost.

That’s correct.

Good point!  Very, very good point.

Yep, you betcha.

In fact, while we’re on reverse mortgages,  I had an e-mail from one of my clients this week who in fact had a reverse mortgage and he paid it off.  When you pay off the reverse mortgage, you get the big interest deduction.  So in one year, he did not have any — he was able — let me back up.  He was able to shift his income to where he took a lot of income because he had this big interest deduction.  Then the subsequent year, he didn’t have to take the income so he had no taxable income.  The point I’m trying to make is that there is a senior homestead exemption if you’re over the age of 65 and your income is under — he’s in Volusia county, it’s about $29,000 or less.  Your adjusted gross income, which is the income on the front page of your 1040, you are entitled to an extra homestead exemption.  In his case, he got an extra savings of $800, $900.


Yes.  However, it expires, at least in Volusia county, on September 1st.  So if you’re in that situation, have low income, adjusted gross income, and if you’re over the age of 65, you may want to check on that.  You may be entitled to reduce your property taxes because the bills have just <Inaudible> on their way.



There you go.


Ah, <Inaudible>.

That’s why we’re here.


Planning tomorrow today.

Bye George, thanks so much for the phone call.  It’s 844-220-0965 if you would like George’s line.  Again, the number 844-220-0965.  We are coming up on the final segments.  It’s your last chance to get your question answered.  Text machine is up and running, as well.  21232.  I see some text questions here.  We’ll get to those on the other side.  Right now it’s time to get the three big things you need — and welcome back to On The Money here on news 96.5 WDBO’s ask the experts weekend.  We have Joe Byrd and Denise Kovas, certified financial planner professionals from Certified Financial Group taking your phone calls at 844-220-0965.  That’s 844-220-0965.  We are five minutes away from the latest news, weather, and traffic, so let’s get back to our conversations here with our great callers.  Ness in Kissimmee.  Ness, you’re up next.  You’re with the Certified Financial Group here on WDBO.

Good morning, Ness!


Yes, good morning, good morning guys.  Thanks a lot for taking my call.  My question is, I have Medicare, actually I’m retired.  I’m just wondering whether the program that I have with Freedom Health is sufficient enough that I don’t need insurance, because you guys were talking about insurance for retirement for health insurance.

Okay, well you’re talking about what you have is Medicare supplement, which picks up with part B —


Of your Medicare doesn’t cover.  So you have the basic —


Medicare.  You go in the hospital, you’re going to pay for the hospital, the part B’s going to pick up the doctor’s cost.  What we were talking —


Is what happens when they take you out of the hospital then you can’t go home because you have to be taken care of?  Or you don’t even go to the hospital —


And you end up in a nursing home for some reason.



Yeah, we’re talking about long-term care insurance.

Long-term healthcare.  That’s not Medicare.

Okay.  Okay.  So it’s long-term healthcare insurance.

That’s correct.


It’s to pick up what your basic Medicare does not cover.  As Denise said, Medicare — if you go from the hospital, my understanding is if you’re in the hospital for three days and you go into a facility, directly in the facility, Medicare will pick up the first 100 days.

Correct.  For skilled services.


For skilled services.

It’s very limited.

But you will find, and I found this out dealing with my dad who unfortunately has passed away.  The hospitals watch that three day clock, they’ll push you out on the curb after two days because they don’t want that three days because you go directly in the facility and Medicare kicks in.  So I’m going to tell you, you’ve got to be very, very careful when it comes to how that whole situation works.  The other thing is we have learned, if you go in the hospital, you have to be sure that you’re admitted, not under observation.  Because if you go in under observation, Medicare part A doesn’t cover — you’re not covered.


It’s only if you’re admitted.  So you want to be —


Careful when you go in the hospital that you’re admitted.  People say, well I’m in the hospital, I’ve been here two days!  I’m admitted!  No, you’re not.  You might be under observation.  Be sure that you’re talking to somebody, be sure that you know what the deal is.

Alright, Ness, that help you?




So then, you guys do have that kind of insurance policy or something?  A backup?

We have different options.

Yes, there are different insurance policies available depending on your needs.  Absolutely.

Could you guys send me a list or something that I could go by and see what the prices are going to be?

Why don’t you give us a call at the office and we can have a conversation?  Our number is 407-869-9800.  Give us a call and we can help you out.  Okay.

Alright, Ness.  Thanks so much for the phone call.  If you want on Ness’ line, it’s 844-220-0965.

Let’s circle back to Gary, Gary Abley, our colleague sent us about five consecutive texts here about the situation in nursing homes, which is very, very important.  I didn’t get it on the first text.  But why don’t you read those?

Okay.  We can start off here from number one.  We also recommend an independent review of the financials of the facility.  My in-laws were in a facility in Tampa that is now bankrupt, elevators not working, limited dining, etcetera.  Taxes could be higher on IRA distributions if someone waits to take it when also drawing Social Security.  That’s two fun facts.

Yes, but the important thing is — and this is critical, because if you go in a facility and you —

And you go bankrupt.

To be there the rest of your life —

It’s a probably.


Now you’re about on the streets and maybe if you paid a down payment or who knows what and it’s — yes.  That’s another good point, Gary.  Appreciate it very much.

Thanks, buddy.

Gary’s got that workshop coming up, right Denise?


Plug those workshops, got one minute left.

It is.  Dag durn.  It’s coming up quickly too.  September 16th in our offices.  It’s going to be that Saturday from 11:00 until 1:00pm.  He’ll be serving light refreshments.  He’ll be talking about financial basics.  Your life strategies for success in financials.  So come out and visit Gary.  He’s got some good information.  Again, it’s in our offices on September 16th from 11:00 to 1:00.

Our office is in Altamont Springs just south of 434.  You can go to our website, financialgroup.com.  Financialgroup.com.  Click on workshops, you make a reservation right there.  In addition to being a certified financial planner professional, Gary is also a CPA.  Highly qualified and a great educator.  Hope to see ya there!

Yeah, wow.  That was a fast hour today!

How about that?

It seemed fast to you, eh, it was fast.  Alright.


Well, hope next Saturday at 9:00am will be just as fast.  That’s when we will be back here with the certified financial planner professionals of the Certified Financial Group planning tomorrow —


Right here on News 96.5 WDBO.  Time, place, news, weather, and traffic in an update on Hurricane Harvey right now.

Dictation made on 8/30/2017 4:42 PM EDT.

Hosts:  Nancy Hecht, CFP®, AIF® and Joe Bert, CFP®, AIF®

Well good morning central Florida. I am Kyle Cassandra and this is another addition of On The Money with the Certified Financial Group, the certified financial planner professionals show. Bert and Nancy Hect live here in the studio taking your phone calls here at 844-220-0965 on a day most people in central Florida didn’t want to wake up to the bad news but we’ll keep you updated throughout the day, all of the latest and what’s going on down there in Kissimmee. But right now, let’s open up the phone lines and talk about your future. Joe how are you today?

Well, we’re okay. How are you, Kyle?

Not too bad. Not too bad.

Beautiful, a little cool this morning. I went out to get the paper about 5:00 and there was a little chill in the air believe it or not.

It looked as if it had rained at my house all night.

It poured at my house.

It did? It poured?

How about your house?

We didn’t get as much rain.

Well, my gosh, I mean, we had a monsoon.


No, we had a little bit and that was it.

That’s Nancy Hect and we are here to do what show?

We are here to answer any questions that might be on your mind regarding your personal finances. As we say in our ads, we go through life trying some of this, trying some of that, wake up when we’re 50 years old and find out what we have is a collection of financial accidents. Therapist going to come a point in time when the paychecks stop and you have to turn hopefully the savings and investments that you’ve accumulated over your working life time into cash, because when paychecks stop, all you have is Social Security plus whatever you’ve been able to save and invest. Oftentimes, we go through life as I said trying some of this, trying some of that. We make investments. We go to these seminars, we listen to our brother-in-law, to our coworkers, read Money Magazine, and find out it’s just not working. Nancy and I are here to


I’m always ready with a smack <?>.

We don’t start at 9:00 on time, you can <Inaudible>.

So here we are.

We’re here to clear up the mind fog about your personal finance and answer any questions that you might have regarding stocks and bonds, mutual funds, real estate, decisions that you have to make about 401(k)s, IRAs, annuities, reverse mortgages, life insurance, all of that and more. We are here. As I say, on Monday through Friday we do it for a fee. But on Saturday morning, we are here for free. So if you have any questions, all you have to do is pick up the phone and you don’t even need to use your real name. You can pretend you’re Jack or Laverne or Daphne or whatever and we are here and just dial these magic numbers.

844-220-0965. That’s 844-220-0965. We also have a text machine up and running as well, 21232, that’s 21232. Nancy Hect is going to get us started with today’s conversation. Ladies, it’s time to take care of yourself. Why older women are in worse financial shape.

Yes, lately it seems like I’m on a wave of meeting with a lot of single women. Whether it’s due to widowhood or divorce, but it seems like — these women are in their mid to late 50’s or older and are dealing with things like still helping their kids and their grandkids.

Oh, yeah, yeah, yeah.

You know you want to make sure that the grandkids have whatever healthcare they need.

That’s what mamas do.

Or school supplies or extracurricular activities and oftentimes we do this to the detriment of ourselves. Many times women, throughout their working lives earn less than men, have more responsibility for the family, end up having more debt in retirement often. Again, family planning and somebody passing away before you expect them to and then they’re left with this or a lot again of what I’ve been seeing in the last couple of weeks helping the kids car broke down. So, we have the superman cape and my warning is that you have to turn the cape around and wrap it around yourself and

I like that.

And be a little bit selfish.

I like that.

Because if we do not take care of ourselves

You’ll be living with your kids.

Well, yeah, and who wants to do that? And second of all, you’re going to be good to nobody. So you have to be a little bit selfish in your later years when it comes to planning for your retirement. Whether you’re single or not, you almost have to take the attitude as if you are out there by yourself and do for yourself and make sure that you protect yourself. If you’re in good financial standing then you have the ability to try and help and do for others.

And that’s exactly where planning comes in.


Because if they don’t know what they can spend, they’ll just spend it and wake up 10 years later and say, oh my gosh, I never should have done that. And if they can do it, so much the better.

One thing that was good yesterday, I met with somebody who is in a relatively new marriage but it is a second marriage for both of them and not quite sure where everything is. We have a wonderful, extensive financial organizer. So I gave it to her and it was a great benign way to open up the conversation. You know, I’m at this age in life, it’s time to get serious thinking about these things, let’s sit down and do this. The financial organizer will help you outline all of your assets, your liabilities, who needs to be notified, the various different medical personnel, what types of things you want said at your funeral, where do you want your funeral to take place, what type of funeral.

And how can they get that organizer?

Well, all they have to do is contact our office at Financialgroup.com or if somebody wants to contact me directly, it’s Nancy@financialgroup.com. And request the financial organizer.

There you go. Free of charge.


There you go. Thank you very much.

Alright, well we are six minutes away from the latest news, weather, and traffic. But we want to get to our busy phone calls this morning as we already have two. Let’s kick it off with Harry in Orlando. Harry, you’re on with the Certified Financial Group here on WDD0.

Good morning Harry.

Hey, Financial Group, this is my first time calling. Nancy, I’ve been hearing your show and recently my brother was giving me information about investing in some kind of online business that you buy some tokens and those tokens convert into coins and then right now, its value is $200 per coin, $200 per coin. In the future, that company grows up and then it becomes $500 of coin. So, you bought the coin for $200 but then five years later, ten years later, you try to sell that coin for $1,000, $500 and you <Inaudible> on that profit. So, I’m 26 years old and I have a couple of thousands of dollars in my savings and I was looking to invest in such a way risk free that I can have kind of income later on in my life.

Okay, so Harry, if you want to buy these coins, how much are you willing to lose? And I’m not saying that you’re going to lose, but this is new, this is really an untested market. We don’t know what type of market there is now or in the future for these coins. So whatever you might put into that, you have to be willing to unequivocally lose 100% of what you put in there.

Right, that’s what he told me too, that I was risking $1,000 that to as if I had never had that money and if my luck that it goes up. If not, then there’s a risk of losing that $1,000 over the years.

So if you’re going to do something like that, that is the proper attitude to take. Now you mentioned that you have $2,000 in savings and that you’re 26. So you do have time to take these types of risks but

No, I don’t have $2,000 in savings, I have more than that, about more than $10,000.

Wonderful. Okay, because I was concerned about you putting 50% of what you have at risk. Harry, you have the right attitude when it comes to buying these coins. This is a gamble. You do have time on your side. You have the attitude that you’re willing to lose that $1,000 as if you never even had it. As long as you have the right mind set, that’s the way you go with that. I don’t know that I would call it an investment at this point. It’s a speculation. But if you feel comfortable with it and you’re willing to lose the money, go for it.

Harry, this is Uncle Joe, forget it. You’re blowing your money. Anything that says you’re going to put in 100 and it’s worth $500 in five years or something, that’s — it’s a scam. It’s an obvious scam. There’s nothing in the world that will do that for you.

Well, yeah. I don’t know if that’s Bitcoin or what.

Nancy is right, if you’re willing to lose it, go for it. It’ll be a life lesson but if you were smart, you would be better off buying lottery tickets frankly.

Especially with our ball being so high right now.

Yeah, but thank you for listening Harry. Have a great weekend.

Thanks for the call. If you want Harry’s line, it’s 844-220-0965, that’s what we’re doing here on the radio this morning, 844-220-0965. Of course, we are talking to the certified financial planner professional at Certified Financial Group, Joe Bert and Nancy, we are planning tomorrow today. Time for a news update with Dave Wallman. Here’s 96.5 Newsroom right after this.

<Background Noise>.

Welcome back, this is On The Money with the Certified Financial Group, a part of News 96.5 WDBO’s ask the experts weekend. We have the certified financial planner professionals with Joe Bert and Nancy Hect live here in our studio, taking your phone calls at 844-220-0965. That’s 844-220-0965. Joe, for those of us that joined during the latest news, weather, and traffic, what can they call you about?

Well, we’re going to try this again as I messed it up at the start of the hour. We are here to answer questions that might be on your mind regarding your personal finances. As I say, we go through life trying some of this, trying some of that, wake up when we’re 50 years old and find out it’s just not going to happen. So what Nancy and I do and the other certified financial planner professionals at Certified Financial Group today in and day out, we work with our clients to show them way what you need to do now so you don’t look back five or ten years from now and say, gee, I wish I had known that or gee, I’m sorry I did that. That’s what planning is all about. As I say, on Monday through Friday, we do it for a fee. But on Saturday morning, we are absolutely free. So if there’s anything on your mind regarding your personal finances, about stocks and bonds and mutual funds, and real estate, and long-term healthcare IRAs, annuities, life insurance, reverse mortgages, all of that and more. Nancy and I deal with that every day so we are here to take your calls. The good news for you, there’s a couple of lines open and all you have to do is pick up the phone and dial these magic numbers.

844-220-0965. That’s 844-220-0965. We also have the text machine up and running as well. You can reach us in 160 characters 21232. That’s 21232. Let’s get back to our phone line. Talk to Iman in Melbourne. Iman, go ahead. You’re on with the Certified Financial Group here on WDBO.

Good morning Iman.

Good morning guys, thank you so much for taking my call.

Sure, talk away.

So my question today is regarding a house. I’m 32 and my wife is 30 . We just purchased our first home back in 2014. I feel like we got a really great deal on it. It had a newer roof, remodeled kitchen and whatnot. I built some equity since we made that purchase. Now, one of the downsides to this house is it is an older home and it has cast-iron plumbing. So I think we’re starting to develop issues with that. I was wondering if it’s a good idea to tap into the equity that we’ve built to go about getting some of this replaced or would it just be a wiser bet to spend some of the money that we have saved up. I just wanted some of your advice and insight on that.

In reference to the money that you have saved up, do you have an emergency fund that’s adequate to pay for the plumbing and still leave you in a comfortable place as far as you’re concerned for cash. Or would it take that down too low?

No, I think that we could pay for it and then have a small cushion left. You know in case of a rainy day. The way the economy is and this presidency and stuff, I’m always scared to spend what we have on him <?>. Not to be that conspiracy doomsday person but you hear where I’m coming from.

Right. Have you looked into an equity line and what kind of rate you would be charged?

I’ve just briefly talked to a manager at a bank about it. I didn’t really deep dive into the percentages and stuff.

You should not be talking about a lot money to do that re-plumbing job. Did you get an estimate as to what that’s going to cost you?

Right, so about 5,000 to 6,000.

Okay, so you’re looking to borrow 5,000 to 6,000 and the payments ought to be reasonable. You can take a tax deduction for it. If the interest rate is a 4% or 5%, I wouldn’t be opposed to it. You’re forcing yourself to do it and then you can always have your emergency money there If you need to pay it off, like Nancy is alluding to, you want to have an emergency fund.

Right. Okay.

And I would try and get a hard number on the rates and if the rate is low enough, you’re not talking about a ton of money, as we said. You’ll get a little bit of a tax break, assuming that you can itemize.

Okay, so I want to shoot in that 4% to 4.5%, that’s

Correct. You’re probably looking at maybe 5% to 6% on a home equity loan, assuming your credit is good.

But anything more than that, then just pay cash for it.

Okay, excellent, well thank you so much guys. I love this show and I really appreciate that.

Thank you. Have a great weekend.

Alright, appreciate it. Thank you so much. Iman, if you want his line, it’s 844-220-0965. That’s 844-220-0965. Gabriel in Orlando has got a question for you guys. Gabriel, go ahead. You’re on with the Certified Financial Group.

Good morning.

Hey, how’s it going?

Good, how can we help you?

So a little jumbled of a question but I’m a graduate student, first year, going through it and I’m trying to go ahead and go through a transition now where I’m a graduate assistant as well, so I’m kind of getting some assistance from the school and I’m trying to go into a place where I’m no longer working full time. So I’m trying to figure out what are good options instead of just relying on loans where I can still manage to pay off credit card and live off of that money.

So what you’re asking is where are you going to get more income so you’re not living on credit cards.

Yes, and what’s a good option for a graduate student who doesn’t have that availability to work full time and go to school full time.

Well, I mean, as most students do, anything in the food service industry will give you flexible hours and a little bit of extra cash. I mean it’s not — you know — it’s an honorable profession that many of us worked in food service while we were going through school. What I try to do is build up some cash reserves as quickly as you can. You’re heading towards a future, working as an assistant and in grad school to hit an ultimate goal. Whatever type of job you take right now is going to help you make ends meet and nothing really should be beneath you. You just need to find something that’s going to be flexible as far as hours go.

Here’s my advice to you. The challenge that you have is not spending more than you’re earning. And the problem you’re going to have is trying to keep up and maintain a lifestyle perhaps with your peers and you run into that stuff and all of the sudden, you’ve got more debt than you thought and now you’re living on the credit card cycle and you never get out of it. You have to look at this as a short — think of it as the minor leagues. Right now, you’re in the minor leagues, you’re trying to get into the majors. Right? So if you’re in the minor leagues, think about a minor league baseball player that goes from city to city living on a bus and eating McDonald’s hamburgers. That’s what you need to do in this particular point in your life. Save as much as you can, try to stay out of debt and get that degree and move on and then enjoy life debt-free if you can.

Or Gabriel, if you had heard the beginning when I was talking about women taking care of their self and being a little bit selfish, you can take on a little bit of that attitude right now for yourself. You know, your buddies may not have the academic obligations that you have right now but you have to do for you right now, while you’re in grad school to get to the point where you want to be.

So thanks for the call and good luck to you.

Alright, appreciate it Garbiel. If you want Gabriel’s line, it’s 844-220-0965. Talk to Maria. Maria, go ahead you’re on the Certified Financial Group here on WDBO.


Good morning, good morning.

Good morning, how can we help you?

Hi, I am a 55 year old nurse and I have a straight pension. I didn’t know if I should roll that into a 401(k) that I currently have or should I start drawing on it?

Are you able to draw on it now?

At the age of 55, yeah.

At the age of 55.

It’s approximately

Okay so you have the ability to start withdrawing your pension or will it grow for you if you don’t draw on it? In other words, if you wait until 62 or 65 or 66, will you get a larger benefit?

No, unfortunately, it’s only grown in the past couple of years approximately $90 or $100 per year.

Do you need the income from the pension Maria?

No, no, not at all. I’m a nurse. I only owe 60,000 on my home. I have an emergency fund of about 6,000. No credit card debt to speak of.

How much longer do you plan on working?

I’d love to retire but I can’t.

Have you had anybody do a financial plan for you to see when you can retire?

Not at all.

Well, of course that’s something that we offer. If you’d like to contact us during normal business hours, financial planning is a big part of what we do and we could answer the questions for you as to when would be the most opportune time for you to tap into the pension and how much should you start contributing to your 401(k). I think anything that you can do pre-tax is phenomenal and makes very little difference in your spendables, depending on how much you’re saving pre-tax. You’re at the age where a lot of people do financial planning and then start doing regular check-ups on their planning to make sure they’re on track. So, why don’t you contact us and let’s give you a complimentary consultation <Inaudible> services.

Give her the number to do that.

407-869-9800 or you can go to Financialgroup.com and request a complimentary consultation.

That’s financialgroup.com.


Alright, thank you Maria. Appreciate the phone call. If you want Maria’s line, it’s 844-220-0965. Let’s keep going. We’ve got a busy phone line today. Jeff in Edgewater. Jeff, you’re on with the Certified Financial Group here on WDBO.

Good morning Jeff. How can we help you?

Good morning. I have a question about IRAs.


I have a drop coming, lump sum payment, and I want to roll it over into IRA and I want to roll it over into a Roth eventually but I believe I want to do it part one year part next and maybe even split it over three years.


Now, I talked to a broker and they said that if I put it in one Roth, I can’t just roll half of that Roth into — I’m sorry if I put it in a regular IRA first, I have to roll the whole IRA into the Roth.

No, that’s not right. That’s not right. You can manage

Maybe that’s their rule.

Yeah, you can manage the transfers from IRA to Roth at will and the idea of you spreading it out over two or three years is to manage the taxability and there’s absolutely nothing wrong with that thought process.

Can I set up two IRAs to start with and then just transfer one into the Roth and then the other the next year?

Well, I don’t really think you need to do that. I think you’re complicating the situation.

Right, right, yeah.

But I think that’s the broker that’s causing this — I think they just don’t want to split an IRA

First of all, let me

But they told me — they suggest that I set up two IRAs first and then do one the first year, one the second.

How much money are we talking about?

About 28,000.

Yeah, no, it’s crazy that he has to open up two accounts. So, you could do one rollover IRA, have the drop go into there and then as you feel that you want to convert some of it to a Roth, you do it.

Let me give you a heads-up here.


We are not big fans of Roth but you’re talking about a modest amount of money. If you can make that conversion in a 10% tax bracket, that’s not so bad. But one thing that you want — the one thing that you want to know and this is where many people really blow this Roth conversion is that the taxes that you’re going to pay on the conversion should not come out of your IRA. In other words, you need to write that check on the outside so you’re transferring and going to end up with the entire amount in the Roth. So if you’re going to transfer 28,000 from an IRA to a Roth, you want to have 28,000 going into the Roth, now 28,000 after taxes. Otherwise, it doesn’t work at all. You follow what I’m saying?

No, why doesn’t it work that way? Because I just have the money.

Because right off the top you’re penalizing how much is going to grow for you on a tax free basis. It makes no sense.

I know, you’re reducing that amount. But if you don’t have it, that’s the only choice you have.

Well, but if you do it in chunks, then you can manage it.

I’m disabled so I’m low income. So this is my other question is, I qualify. I have Medicare and I qualify for Medicaid. Now, I know if you have the IRA and you don’t take disbursements, Medicaid will consider it an asset. But if you set it up with a distribution, they don’t consider it an asset, right?

Right. That’s correct.

How many years do I have to divide that out to for the distribution?

That I don’t know off the top of my head.

Because it’s a function of income and I have the information in the office, I don’t have it with me here today.

We’re coming up against the break but get out the number so Jeff can give you a call during the week <?>.

407-869-9800 from 8:30 to 5:30 Monday through Friday, 407-869-9800.

Alright, okay. Jeff thanks so much for the phone call. Kim, Dave, and Sam hang on the line. We will get to you right after we get the three big things you need to know.

Hey, welcome back, it is the final segment of On The Money with the certified financial planner professionals, the Certified Financial Group. Joe Bert and Nancy Hect live here in the studio taking your phone calls at 844-220-0965. That’s 844-220-0965. We are four minutes away from the latest news, weather, and traffic. Dave Wall will keep us updated about the situation going on down there in Kissimmee but right now we’ve still got four minutes left so let’s get back to our busy phone calls. Talk to Tim in Orlando first. Tim, you’re on with WDBO.

Hi Tim.

Good morning Tim.

Hi, thanks for taking my call.

Sure, what can we do for you?

I have a good situation I’ve recently inherited some money. Enough to pay off my house. But I only have five years to pay off the house so most of the money is going towards the principal. Should I pay my house off and pretty much that’s all of our debts. We’re good with our retirement — or should I just keep the money and keep that as some liquid money and just continue to make the payments?

Maybe not. Let me ask this. Do you have a retirement plan at work, 401(k)?

Yes, he said they’re good with retirement.

Yeah but what does that mean? Are you using — how old are you?

I am 53 and hopefully would like to retire by 62.

Okay, are you putting $24,000 a year into your 401(k)?

Probably between me and my wife, yes, at least.

Not between you and your wife, I’m talking about you.

Individually, you can put aside 24,000 — if she’s over age 50 also.

Right, well no, I’m not doing that. But we’ve been putting money into — I’m sure we don’t have, between our retirement and our pensions and our Roth, and 401(k)s and I think that by the time we do retire that we’ll be good.

Hold it, hold it, hold it. You can’t go into retirement saying I think. You need to know, you need to know 100% for sure. It’s not a guess. Because when you start down that long road called retirement at your particular age, I have to worry about 35 years for you in retirement. You can’t go into it saying I think.

I have two things for you. First of all, if using the money to pay off the mortgage allows you to increase what you’re contributing to your 401(k), go ahead and do it. Because both you and your wife need to be funding to the max that you can. Point number two, you need to have a financial plan done. So please contact us and schedule a consultation for a financial plan. So you can go from the I think to I know.

And you need to do it before you retire because the toughest cases that Nancy and I work on are clients that have already retired, made the decision to retire and they come in to see us for the first time and the wheels are coming off because they didn’t do any planning.

Thanks Tim for the phone call. I really want to get to Dave in Cocoa Beach. He’s got a quick question before we get out of here. Dave, go ahead you’re on the Certified Financial Group.

Good morning.

Good morning.

I’m 66. Still working, no Social Security. How much am I allowed to <Inaudible> back into a 401(k) and defer until retirement.

$24,000 a year.

Assuming you’re not more than a 5% share holder in the company.

Okay. Yes, I am self-employed.

Well! Okay.

You can do a self-employed pension and for 2017, you can do 20% of your adjusted gross income up to $54,000 into a self-employed pension.

That’s — one up.

That’s better than the 401(k) limit.

That’s going to do it. Real quick. What’s the best number to reach you guys during the week.

407-869-9800 or financialgroup.com.

We have been planning tomorrow, today with the Certified Financial Group. We’ll be back here next Saturday 9:00am right here on News 96.5 WDBO.

Dictation made on 8/22/2017 2:28 PM EDT.

Hosts: Gary Abely, CFP®, AIF® and Joe Bert, CFP®, AIF®

Well, good Saturday morning to you Central Florida, I’m Kyle Cassandra, this is On the Money with the Certified Financial Group here on News 96.5 WDBO’s Ask the Expert weekend.  Joe Bert, Gary Abely live here in the studio taking your phone calls at 844-220-0965.  Good morning, gentlemen.


Good morning.


Good morning.


How are you both today?


We’re doing great, how are you?




Alright Mr. Oracle of Orlando, Joe Bert, what can the audience call you about today?


We are here to answer any questions that our listeners might have regarding their personal finances.  As we often say, we go through life trying some of this, trying some of that, and wake up when we’re 55 years old only to find we have a collection of financial accidents.  At some point in time that paycheck will stop, you’ll be looking at Social Security, and then you have a gap.  Well, how are we going to enjoy the lifestyle that we always dreamed about if we only have Social Security and that’s only going to come from if you’ve been able to save, and invest, and accumulate over your working lifetime.  And unfortunately, Gary and I see time and time again folks that make these decisions, they really have no idea why they made them.  Maybe they listened to their brother-in-law, their co-worker, money magazine, some guys on the radio on Saturday morning, who knows what they were listening to, and they find out that they really don’t have any direction.  So, as we often times say on Saturday morning, we do this for free.  On Monday through Friday, there is a fee.  So, the good news is we are here to answer your questions that you might have about stocks and bonds, and decisions that you might be making about your 401k or IRA, reverse mortgages, life insurance, reverse — I said reverse mortgages — insurance, annuities, anything else that’s on your mind.  So, the lines are absolutely wide open and if you have any questions on any of those topics, anything that’s on your mind, anything you are curious about, wanted to know, Gary and I are here to take your calls.  And all you have to do is pick up the phone and dial these magic numbers.


844-220-0965.  Poof, just like that.  Magic.


Magic numbers.


844-220-0965.  I also have another set of magic numbers for you.  They’re called the text line, text numbers, 21232.  You can text us your question, just keep it to about 160 characters.  Again, you can text it to 21232.  Gary Abely, who just sent some of his kids off to college in here has our topic of the day, kicking it off.  How to help children establish credit and when to start.


Well, you can just imagine why I came up with that topic, right?  So, there’s really a few ways that you can help your children establish credit, and I guess the when to start just really depends on your children.  But we started in about 11th grade as I recall and there’s a few options that you can do.  So, with respect to at least credit cards, you could do a secured card and that’s a situation where you would put $500 or so in a bank account and then you would have a credit card with a $500 limit.


On your child’s name.


On your child’s name.


So, you’ve given them $500 of plastic.




Got it.


Now there’s a negative to that because it is their card and I, as the parent, don’t know what they’re spending.  Right, I’m not going to get a copy of that statement.  It’s their own.  Now, the beauty of it is they can only get into $500 of trouble, right?




But often those cards have high fees and they tend not to be the best bet because often at times there’s low balances and we can all think of an emergency that might cost more than $500 today.  So, you have another option.  One would be to cosign on a card.




What, you don’t like that option?


I don’t like that option.


I didn’t like that option either.  So, these would be for the extremely trustworthy children who have already been taught financial basics and you have complete confidence.  But, the negative with that is you don’t know what they’re spending the money on.  They could actually get an increase in the line without you knowing it.




Now you’re responsible for more money.  So, I didn’t like that idea either.


So, let me ask this: If you cosign on one of those cards do the statements still come to the kids or do you get a copy of the statements or what?


No.  You do not get a copy of the statements.


So, the kids — so, you cosign on a card for $1,000 and they got an increase to 5,000, you don’t know it? They’re getting the statements?


You still cosigned <Inaudible>


Okay, got you.


So, didn’t like it.




Okay, and that’s option two.


So, the option that I chose and I think the option that is probably best for most is to allow your child to be an authorized user on your own account.  Now, you get your statement just as you normally do and you do see all of the charges.  Of course, you’re responsible for them, but the beauty of this is your child will basically piggy-back on the credit that you have established for that card.  So, for example we chose a card that my wife and I have used now for I can’t remember, maybe — actually, I can remember because it was when they were born, so about 18 years ago because it was a Fidelity card that it gave 2% of your purchases into a 529 plan.  So, in any case, they will get credit, that credit history on that card, they’ll be able to piggy back on.


Got it.


Now, there was a time we might have a listener think well no, I don’t think that’s accurate, because there was a time when that was not the case.  But, they actually will get credit by being an authorized user on our card.  Which is pretty nice.  And with American Express, if your credit is good you have unlimited credit.  So, theoretically if they had the American Express card, they could only buy one Maserati and then you call them, right.


Whoa, I’m not sure I like that idea.  Well, ours does not have such a high limit.




But I do like that, because you can monitor the spending.




And you have a little bit more control.


So that’s the path you’ve chosen?


That is the path.


And now they’re off to college and that’s what they have in their wallets?






We’ll see what happens next month.


There you go.  Stay tuned.


I have confidence.


I’m sure you do.  They’re good ladies, twins.




And they were both joint valedictorians of their high school graduating class too <Inaudible> good for you.  Congratulations.


Well, we had a couple of callers call in and they just dropped off.  I was about to go to them.  I just looked down <Inaudible>


We talked too long.


No, I want to give out the phone number one more time; 844-220-0965.  844-220-0965.  Great information on the credit cards; authorized user versus cosigner on an account.


Right, right.


Or do you recommend like the cash back cards.  Is that something you would give a child? Or <Inaudible> APR?


Well, you know, any card that has cash back, as long as the fees aren’t too high — sometimes these cash back cards will have high fees and there’s not enough charged on it to even cover the annual fee.  So, it really does depend on what they spending will be — what your anticipated spending will be and what the fees are with that card.


Of course, the key with every credit card is to pay it off every month.


Well, that’s right.


You don’t want to use it as a lifestyle, because unfortunately we have seen as well when folks get these — you know, when my kids went to college, which are older than yours of course, but they are — I remember going on campus in the orientation and every credit card in the world had these little tents set up giving you yo-yos and t-shirts and whatever.  Sign you up, sign you up — by the end of the day, you could have 10 credit cards and all of a sudden the kids in — you know, they’re at college and running up the credit.  We’ve seen that happen.  Not my kids fortunately, but I have — we’ve seen those stories.  And not only do they have student debt, now they have credit card debt.  What a mess.  So, that’s a good approach, Gary.  Alright, we’ve got a call here.


Yeah, let’s go to Steven in Apopka who’s up first.  Steven, you’re on with the Certified Financial Group here on WDBO.


Good morning, gentlemen.


Good morning, Steve.


I wanted to piggyback on the question — I have a question on the subject you’re talking about now with the adding kids onto your credit history.  I have a 17 year old.  Do I need to wait until he turns 18 in order to add him?


That’s a good question because my daughters are just about 19 and I’m trying to remember whether there was an issue with the age 18 or not.  You don’t happen to know, Joe?




No, I think you can, as —


You have to be 18.


As an authorized user?


No no, not as an authorized user.


Right, right, right.


I don’t believe so, but to have it in your name alone.






Correct, yeah, so you could — the strategy that I was talking about, Steven, you could add them as an authorized user, but they could not get a card on their own until they were 18.








Okay.  The objective is to add them so they can get the benefit of my history.


That’s right.


And eventually transition them into their own credit history.  My second question would be at that point when I’m transitioning them off of my credit, will that harm their credit?


No, it won’t harm their credit at all.  The whole idea of it is to help improve and establish credit, have them establish a credit score so that they could get their own card once they’re off on their own.


So, the history that — the amount of time that I’ve had building all that credit, when that falls off of their credit, it won’t harm them?


No.  It doesn’t even pick it up.  That’s not transferable.




Your credit history is not transferable to your child because you’re the responsible party.


Alright, but you mentioned they would piggyback and get my score essentially.


No, not your score.  Not your score.  They would be getting credit for the history of that card.  Not your score.  <Inaudible>


Oh, I misspoke then.


And so they will get the benefit of that.  So, it’s very important if you do make your child an authorized user on a card, that you select a card that you have always paid off and that you’ve never had any problems with.  Because if you were to select a card where, whoops, we forgot to pay because we were on vacation or something, then you’re actually hurting your child, not helping your child.


The number one thing, Steven, that affects your credit score is your payment history.


Well, I have zero balances on all my accounts, so I’m very studious on that.




I would probably pick, I guess, the longest — or oldest credit account that I have to add them to —


I would too.


And try to get the maximum benefit.  Are you able to add them to more than one account?


Yes, you could add them to several accounts.  I don’t know that I would do that because I have a child heading off to college with multiple cards, eh, I think I’d just stick with one.


The thing is I’m not going to give them the actual card.


Oh, okay.


So they’ll get the benefit of the score, but they’re not getting anything tangible in their hands.


Okay, well there you go.


That’s cagey.


You’ve thought this through, Steven.  I like it.




I’m not going to actually give them a card, but I want to make sure he gets the — Steve in Apopka, thanks so much for your phone call.  If you want Steven’s line, it’s 844-220-0965.  844-220-0965.  Yeah, you can get them a card and use it at the Home Depot and it’s under their name, right?  Is that how that works?


Yeah.  I was just going to add before he left that it would be a good idea to use that card in the child’s name.


Oh yeah.


And just don’t stick it in the drawer.  <Inaudible> don’t just stick it in a drawer.


Exactly, exactly.


Use it on occasion.


I wish our listeners could have a peer into our studio this morning because I’m sitting here in the air chair as I usually am on a Saturday morning talking into the microphone and Mr. Abely is standing next to me and Mr. Abely has one of those stand-up desks, so he stands all day long.  Yeah, stands, and he’s —


I wish I had one of those.


Ah, they’re great.


He started the trend in our office, so we have more than a couple around the office and we swear by it.


Well, I think you’re smarter —


How long has it been you’ve been using it now?


I don’t know.


About a year maybe?


Maybe a little over.


Yeah? Have you — give me the — give our listeners — because we see these things advertised all the time.


Well, I purchased the <Inaudible> desk which you see a lot in the papers and there’s no assembly, which is what sold it for me.  I have 10 thumbs.  So literally, you just plop it on your desk and you can lower it very easily if you want to sit.


But the benefit — physical benefits to you.


Well, outside of you burn a few more calories —


You look trimmer.  You look trimmer.


Yeah, well, I don’t know about that.


Well, you do.


But, I think being able to move around you have less issues with your back, I really do.  You know, your back and neck — you can adjust your monitors perfectly.




And when you’re standing, it’s just you move around a lot more.


The benefits of a standing desk are just documented all over the place.  What’s so funny, when I went to ABC in New York this past couple months ago, all of the desk for the big wigs were all hydraulic.  So, if you wanted to sit, you could.  Or you, could press a button and they would lift and they would stand.  And I was like aw, man, I want once of these.


Only in New York.


I was going to say, that’s at the network level.  We need to bring that here to DBO.


Yeah, sweet.


844-220-0965.  844-220-0965.  That is the number to dial us up, talk to Joe or Gary today.  Text number is 21232.  We will continue with your calls right after we get the three big things you need to know.  And welcome back, this is On the Money with the Certified Financial Group here on News 96.5 WDBO.  We are taking your phone calls at 844-220-0965.  That’s 844-220-0965.  We’re the certified financial planner professionals, the Certified Financial Group; Joe Bert, Gary Abely in studio, again taking your phone calls and text, 21232.  We are four minutes away from the latest news, weather, and traffic with Dave Wall over in the News 96.5 news room, so let’s get back to our busy phone lines here.  Talk to Fred over in Winter Springs.  Fred, you’re on with the Certified Financial Group here on WDBO.




Good morning.


Good morning.


Thanks for taking my call.


Sure, how can we help you?


Yeah, I’ve got a couple of — well, my wife and I have a couple of IRAs from past employers — 401(k)s.  Considering rolling them over into an IRA possibly, but wanted to look at — we have some other funds in a Scottrade account, but we’ll have to probably get away from managed mutual funds style of account.  Was looking more into diversifying into either silver and gold with that money.  Is that a good thing to do in your estimation?


Well, I don’t think so.  Well, when you say diversifying into silver or gold, if a client came to me and said Gary, I want to have 2%, 3% in a silver or gold mining fund or something along that line I would say alright, the 2%, 3%.  But, if you look at the history of investing in precious metals, you might have done better burying it in the backyard.  Am I exaggerating, Joe?


No, not at all.  The problem is is that because there are little if any restrictions on what these adds can say, you see them all over the place and they — I’ve seen them.  The most recent one; silver is at all-time low.  If it ever gets back to where it was, you’ll have a 200% — I mean, if we said that in the investment world, we’d be in handcuffs.


Yes, right.


So, they throw all this stuff out there to entice you to think you’re going to find the next silver nugget if you will to improve your investment returns.  And then you have to be careful of who you’re dealing with because a lot of these — not a lot, but there’s some of these firms that they’re boiler rooms, they want to get you on the phone and then next thing you know, they want to sell you <Inaudible> coins and things that are very hard to value with big mark-ups.  If you want to have precious metals in your portfolio, and I’ve done this for clients on a limited number of cases, we can buy the bullion for you at a 2% over spot price and have it stored for you at 1% per year and you’re actually owning the bullion.  But, at a part of your overall portfolio, as Gary said, I wouldn’t put more than a couple percent in it.  Because, it’s a high risk/high reward proposition.




And I think, Fred, Warren Buffet said it best and I’m going to butcher trying to paraphrase what he said.  But he said you know, you buy a metal; first you’ve got all the costs of digging it out of the ground and then mining it.  You get it into this beautiful state and then all of a sudden what do you do? You put it back into the ground and you pay somebody to guard it, and then you also have to pay an insurance company to insure it.  So, my wife and I have a coin collection that we — of course, you can’t keep it in your house.  You have to keep it in the safety deposit box.  And a lot of people don’t know this, so I thought I’d throw it out for our listeners, if you have your safety deposit box at any bank, Bank of America where we have to have it, you are not insured there.  So, if you have any sizeable collection, you have to pay that fee and that fee for an insurance policy is called a personal articles policy.  And it can actually run 1% to 2% per year to insure what’s in a safety deposit box.  So, most people don’t do that.  So, because of the issues of owning metals and having to pay for it and, as Joe mentioned, the cost each year, it just really adds up.  So, we wouldn’t recommend it, Fred.  Stick with diversified mutual funds.


And if you buy it, then you have to find a good way, an efficient way, to sell it.  And you’re going to pay a fee to sell it.


A commission to sell it, right.






Alright, Fred, thanks so much for your phone call.  If you would like Fred’s line, the number to dial us up is 844-220-0965.  That’s 844-220-0965.  We are planning tomorrow —


Today —


With the certified finance planner professionals, the Certified Financial Group, Joe Bert, Gary Abely here on News 96.5 WDBO.  Hey, welcome back, this is On the Money with the Certified Financial Group here on News 96.5 WDBO’s Ask the Expert weekend.  We have the certified financial planner professionals from the Certified Financial Group, Joe Bert, Gary Abely live here in the studio taking your phone calls at 844-220-0965.  844-220-0965.  We also have the text machine up and running as well, 21232.  Joe, for the people that joined us during the latest news, weather, and traffic, what can they call you about today?


Well, once again, Gary and I are here to take any questions that’s on your mind.  There’s no such thing as a dumb question, that — anything that’s on your mind concerning your personal finances.  What do I do with stuff? I’ve inherited some money, I want to buy a house, all this kind of thing.  What do I do with this life insurance? Do I really need life insurance anymore? I’m thinking about buying an annuity.  What’s an annuity all about? What’s a mutual fund all about? In fact, talking about what a mutual fund is all about, Mr. Abely right here is standing next to me, on October the 21st is going to have a session: everything you want to know about mutual funds.  This is the most popular investment today —


Of course.  Mutual funds.


Yet many people have no idea —


No idea, not a clue.


No idea what they are, how they work, why they’re good, why they’re bad, where they should be used, maybe where they shouldn’t be used.  That’s on October 21st from 9:00 to 11:00.  This is a daytime session on a Tuesday.


On a Tuesday, okay.




That’s what it says right there.


Was that your intention?


I don’t know.  I’m thinking —


Maybe not.


Maybe we have a look at that date.  I’m not sure that’s right.  Anyway —


Anyway, alright.


It’s on the website.


In any case, what are you going to cover?


So, well, a lot of people, just — we had that phone call earlier and thinking, well, maybe I want to diversify into gold.  Well, we talk about what is diversifying.  Do we have all of our money in an index fund? Well, that could be diversified if it’s a broad index, right? Do we have all of our money in a managed fund or should we use both managed mutual funds or passive or index funds? So, we talk about what’s the difference between the two of those.  We talk about large cap, mid cap, small cap.  What’s the difference between those.  What’s a large cap fund?


Should you even have a large cap fund?




What if you have a small head?


Alright, I think we’re getting off topic.  But, alright, so then we talk well, what’s value versus growth? Well, if we look at the returns of late, you’d probably never want to buy a small cap They’ll probably never want to buy a small cap value or a large cap value because they have grossly been underperforming growth.  But as you know Joe, that’s not always the case.  Thank <?> small cap value’s long-term have been one of the best categories to invest in.  So what’s the difference between value and growth, what’s —


<Inaudible> blend fund.




What is a blend fund.


Yeah, of course that’s <Inaudible>


How do you look at what the fees are, and how long the managers <Inaudible> been there?


Well, these are important things because we’ll have folks who manage their money on their own and they’ll come in and they’ll say would you take a look at what I’m doing and just bless this or tell us where we’ve gone wrong?  And that’s quite a bit of what we do, and you’ll oftentimes see somebody has picked a fund that was great at one point, and when they picked it, maybe it was a five star fund.  And then now all of the sudden it’s a two star fund.  They haven’t been monitoring it.  And perhaps the manager of that fund retired three years ago and they put a rookie or who knows who they’ve put in place of these seasoned manager.  So we have to look at several things when we look at mutual funds.  But obviously management tenure, we want to know how is it comparing next to its peers.  So we had somebody come in a couple of weeks ago and they were going over the portfolio and they had 180% return on one particular fund and said oh <Inaudible>.


I want more of that, <Inaudible>.


No, no, no, no, so it this has been my best investment.


Yeah, right.


And I calculated it out and it was about a 4.5% return because they had held that darn thing for 26 years or something <Inaudible>.  And so what looked good on paper looking at that statement, they had no concept of what the annual return was <Inaudible>, because I think their statement was with Schwab and it just said the overall gain or loss.  And I said well this thing — this is dog doo, you don’t want this.  Look at it, it’s two stars.  Yeah, it’s done well because you’ve owned it, but is well.  I would say this has not done well.  So we really get into asset allocation.  I remember we had 2013, I had met with somebody and they were in a 60/40 portfolio.  Everything they had looked good and I said that’s looking good.  Came to me a year later and that portfolio was 80/20.  And I said you’ve got to watch this <Inaudible> because <Inaudible> small caps went up over 40% that year, large caps were up in the mid 30s, and all of the sudden they were in a whole different risk profile.  So those are the kind of topics that we cover <Inaudible> we do for our clients what they really don’t want to do but what they have to do is right.  And that’s to sell high and buy low, <Inaudible> re-balancing, and that’s where the strength long-term is for investing.  But unfortunately people — it goes up, and then they watch it go down.


Well, it goes against the stomach.  They say why would I sell something going up?




Or why would I buy something that’s down, that doesn’t make sense.


Exactly, exactly <Inaudible>.


But you know I think people —




People — they don’t realize that an investment is an investment.  If they thought about investing in <Inaudible> mutual funds as you would like in real estate.  If the price went down, you’d buy more of it.  Remember the recession, 2008, 2009, <Inaudible>.


That’s a great example.


Prices were depressed, you’d almost give the stuff away.  Nobody was buying it, but the smart people said man there’s some opportunities here <Inaudible> buy.




Yeah, right.


When it comes to investing, it’s just the opposite.  Investing in securities or mutual funds, you know.  People don’t want to buy it when it’s low, they want to buy it when it’s high.






It’s a <Inaudible>.


So Warren Buffett said you know we love to buy a pair of jeans when they’re half off, but when stocks are half off nobody wants to <Inaudible>.


To buy, yeah.


It makes no sense.


As I say, the stock market is the only market that when things are going on sale, people run out of the store.




Well that’s why most people unfortunately are poor investors.  But this is where we take responsibility as their certified financial planner professional or as their advisor to force them to do the things that need to be done and take the emotion out of it, and that’s where people mess up time and time again.  For instance, right now with what’s going on with the news about Korea.


Oh my goodness, yes.


So we — in fact I met with somebody yesterday that said yeah I’m thinking I’d like to move to cash, government securities because I’m worried about North Korea potentially <Inaudible>.


Before you keep going Gary, I just want to give out the phone number real quick in case anybody has a phone question.  844-220-0965.  844-220-0965.  Gave out a lot of information about mutual funds in case Gary says <?> ooh, I want some more information about that.  844-220-0965.  Text machine is up and running as well, 21232.  Yeah, North Korea in the news a lot lately, a lot of people getting a little nervous about those headlines.


Before we get off to that, going back to the mutual funds, Gary’s got this workshop and it is on a Saturday.


Oh yes.


It is.


Saturday, this Saturday <Inaudible> October, it’s misstated here on this form that I have, but it is Saturday, October 21st in the morning.  Come on by.  What time?


9:00 to 11:00.


9:00 to 11:00, there you go, at our office in Altemont Springs.  You can go on our website, it is a Saturday.  It might say Tuesday, but we know it’s a Saturday and Gary will be conducting.  Gary is not only a certified financial planner professional, he’s also a CPA and we’re proud to have him with our team.




Well <Inaudible> speaking of that, so another aspect of mutual funds.  I remember back — I think this was 1995, I was doing a tax return for somebody and they had invested in the Fidelity Magellan Fund, if I recall.


Oh yeah.


And I think that was the year — I might be off, but it did 40%.  And I said oh, I’m sorry about that.  And he goes why?  He said this was great.  I said well look at the Vanguard 500 Index Fund, look what that did.  And he said well okay, it did 37%, well mine did better.  I said okay well this is held in a non-retirement account.  Now let’s look at the after-tax issues, right?  Because the Magellan Fund had turned over the portfolio so much in that year that he had a $10,000 tax bill to pay for the capital gains distributions.  Meanwhile, the index fund had very low turnover, very tax-efficient, and he actually had to sell a good bit of the Fidelity Magellan Fund —


To pay the taxes.


To pay the taxes.  So in addition to just overall returns, we’ve got to look at the tax-efficient, any what mutual fund should you hold in your retirement account, what mutual funds or ETFs, exchange-traded funds should you hold in your brokerage account.  Because everything we do, we have to remember, it’s not the return we see on the statements, it’s what you get to keep.  So we’ve got to focus on taxes when we look at investments.


Right.  Alright.


So back to North Korea.  That’s not a fun topic, so.  What do you think, Joe?  When you have so — I can say what I quote that individual.  I said you know I remember 9/11.  And in the workshop, I typically will ask the attendees how many years did it take us to recover from 9/11.  And of course it’s a trick question because the answer was 22 days.  And people are surprised, most people think it took years to recover from 9/11 and what I said to this individual is tomorrow, if my children were sick, I would take them to the doctor.  And to get there, I might have to fill up my gas tank.  And I’m not going to not go to Publix or Costco, wherever I buy my food and not feed my children because of some catastrophe.  So I’ve got to buy food.  If they have a flu, I’m going to go and buy Tamiflu or something, right?  So life goes on in the midst of craziness.  You think about what the Israelis have had to suffer through almost their entire existence under the threat of something.  So while it’s very uncomfortable to think about the what-ifs, you really can’t worry about what you cannot control and you can’t change your long-term investment strategy over these issues.  If you want to <Inaudible>


And there will always be an issue.  If it’s not Korea, it’s going to be what are the Chinese doing, Chinese <Inaudible> now, what’s going on in Greece, and all of the stuff we have day in and day out, year in and year out.  There’s always an issue.  There’s been some great charts put out by the investment community about all of the things that have happened.  The presidential assassinations to world wars and all of that stuff, and the world just continues to spin.




Now, if there was a nuclear holocaust, all bets are off, and what’s the difference?


Right, what’s the difference?  Then all of the gold we have in our safety deposit box doesn’t matter <Inaudible>.


But if you’re going to live your life like that, then <Inaudible>.


Right, exactly.


So in our business, you have to be an optimist.  You have to be an optimist about — you have to be a realist.  But I think you can’t cower at everything that comes across the water about what’s happening.  And unfortunately, as we know the media plays on fears because that’s what drives sales, that’s what drives sales, that’s what drives attention.  When you have a hurricane, people turn on the phone.  When the market goes down 1,000 points, people are wondering what’s going to happen and it’s the media’s need to drive traffic.  And when the plane lands, it’s not good news.  When the plan crashes, everybody talks about it.


And now more than ever it’s so much information that’s just available.  I pull out my phone, look I can click my phone right here and I’ve got the stock in real time.  It’s like that wasn’t the way even 10 years ago.  You still had to go look it up and find a computer, it wasn’t available for you at any second of the day.


But reacting to news, for example there’s a commercial out, most of us have probably heard it.  The woman’s meeting or date for dinner and she says oh a NATO plane was just downed, I’m going to <Inaudible> my brokerage account and hedge.  And I’m thinking, are you kidding?  That’s just the worst possible <Inaudible> ever give, is okay I’m going to going to reposition my long-term investments because of a NATO plane.  Give me a break, we have to think long-term and we can’t worry about what we cannot control.


Well our experience is the most successful investors think long-term.




You can’t think about what’s happening today, this week, this month, this year.  When we do planning, it’s for the rest of your life.  And that’s the only way I believe to address and achieve long-term financial security.




You have to think in those terms.


And for most people who are invested moderately to the individual who wanted to go all to cash, I say well let’s look at where you’re at now.  And she had roughly about 45% of her money in fixed income, a good bit of that was government bonds, some are corporate bonds.  And I said now let’s look at that number and let’s divide that number by your spending annually.  After factoring in your Social Security benefits, and we calculated that she had 12 years of spending — current spending based on just her — we’ll call it her safe portion.  Her non equity, and I said now well you can’t think of any crises that has occured <Inaudible> that would last 12 years, right?  This is going to be probably done fairly quickly, this current crisis.


So what the take-away there is if you lost all of your equity portfolio, every company in the world was useless, worthless, you’d still have 12 years of living — in fact it’d probably be greater than that because all of the money that came out of stocks are going to bonds and a bond portfolio would increase, so she’d have more than 12 years.






<Inaudible> Interesting.  You know sometimes I just sit and listen and learn so much <Inaudible>.  Because before this segment, I thought mutual funds meant everybody was having a good time.  But now I know to buy high, sell — it’s just amazing.  844-220-0965.  844-220-0965.  Text at 21232, we are planning tomorrow —




With the certified financial planning professionals, the Certified Financial Group here on News 965 WDBO.


It is the final segment of On the Money with the Certified Financial Group here on News 965 WDBO.  We’ve got the certified financial planner professionals, Joe Berg, Gary Abely still in studio answering your phone calls.  844-220-0965.  844-220-0965.  Text machine is up and running as well, 21232.  One text question here for you, Joe Berg, is on the machine before we get out of here.  We were talking about North Korea and the markets and all of that stuff.  Texter writes the market dropped earlier this week amid the North Korea.  No one has a crystal ball, but do you think the market has bottomed down, or will more losses be incoming?  And you guys have already started laughing a little there.


Let’s talk about the market and it dropped, right, right?




In perspective.


Yeah.  In fact, I was watching the news at 6:00 on Thursday evening.  Market plunges —




Plunges 200 points and North Korea, yadda yadda yadda.  Folks, a plunge of 200 points is less than 1%.


Not a plunge.




That’s not a plunge.


Nothing.  But you know people hear the points, they forget that the Dow is the <Inaudible> 21,000, right?






And so let’s talk about that.


Well, so if we go back to 1980, if you look at the average intra-year, so within one calendar year decline for the S&P 500 Index, a nice broad index to look at, the number is a decline of 14%.  Personally, I don’t see any reason why this year would be different than any other average year <Inaudible>.


So a 14% drop on the Dow —


3,000 points.


It’d be 3,000 points.


So that’s 15 of those 200 days.


And that’s not even a bear market.


No, a bear market would be 20% or more <Inaudible>


Over 4,000 points.


Yeah, exactly.  So these are not — now the question is — this particular text is we will we have more losses coming due to the North Korean scare, as it’s worded.  Possibly, who knows.  Again, <Inaudible> even says I know you don’t have a crystal ball.  No, we do not have a crystal ball.  I actually do have one in my office but I have found it does not work very well, because clients ask me my crystal ball.


And the key is you will get through it if you’re diversified.


That’s right.


And if you have a longer term perspective.


And the beauty I think you alluded to it earlier, the beauty of when the market does decline is when we are re-balancing our client portfolios, we are buying more shares at lower prices, which improve that long-term performance.




That is the key.






Yeah, you can’t be static about it.  You’ve got to watch it and you have to make the moves and nobody has a crystal ball.  But once again the key is — two keys: quality and diversification.




<Inaudible> and re-balancing —


And re-balancing as you go.


Is a terrific strategy for buying low and <Inaudible>.


And re-balancing using tax-efficient strategies.




Exactly.  You got it.  That’s what we do.


Let’s see, we’ve got about a minute and a half left, so let’s re-stage a little bit about the upcoming workshop.




Gary, you’ve got one coming up.


Mr. Abely.


We do.  <Inaudible> we talked about the mutual funds, we also have one coming up, financial basic, life strategies for success.


And what do you cover there?


You can sign up for that.  Boy, what don’t we cover?  So we talk about compounding of money, we talk about basic life principals, learning to live on 90% of what you make, always saving 10% would be one strategy we talk a little bit about.


Don’t give away all of the secrets.


Oh no.  So we talk about 10 life strategies and then we go into overall financial basics, asset allocation, diversification, mutual funds, what are they?  What should you have in your portfolio?  So it’s very educational.  I started doing this in high schools and I noticed that the teachers were taking all of the notes and realized that you know this isn’t something most people have learned going through high school or even college.




So you want a good broad understanding of how the financial systems work, come to that workshop.


So you’re going to do that on September 16th, go to our website, financialgroup.com, that’s financialgroup.com.  You can make your reservation right there, it’s absolutely free.  You’ll get to meet Mr. Abely, CFP, CPA.




That’s right.


Yeah, <Inaudible> hope to see you there.  Alright, that’s going to do it for this week’s addition of On the Money.  We have been planning tomorrow —




The News 965 WDBO ask the experts weekend.


Dictation made on 8/15/2017 5:37 PM EDT.


Hosts: Nancy Hecht, CFP®, AIF® and Joe Bert, CFP®, AIF®

Hello everybody, and welcome to another addition of On the Money with the Certified Financial Group, we’re here on News 965 WDBO.  We’ve got Joe Bert and Nancy Hecht in the studio this morning.  Good morning, everyone.


Good morning.


Good morning.


How are you today?


Doing great, how are you, Carl?


Oh, not too bad.  Kicking it off on another Saturday 9:00.  Why are we here, Joe?


We are here to talk about your personal finances, or talk about those issues that might be on your mind as you approach those retirement years, how do we turn our 401k, IRA and savings and investments into income.  Because when those paychecks stop, you’ll have Social Security and whatever you’ve been able to save and accumulate.  And unfortunately we go through life trying some of this, trying some of that, and look back and find that we have a collection of financial accidents.  And somebody has to pull that all together and show you what you need to do, and our objective is to show you what you need to do so you don’t look back 5 or 10 years from now and say gee, I wish I had known, or gee I’m sorry I did.  So that’s why we’re here, to clear up those questions that you might have about stocks, bonds, mutual funds, real estate, long-term healthcare, IRAs, annuities, reverse mortgages, life insurance, all of that and more, we are here.  So Nancy and I are ready to take your calls and the good news for you is that because we just kicked off, the line is absolutely wide open.  And you don’t even have to identify yourself.  So you can call in, pretend you’re Jack, Daphne, Loretta, whatever you want to be, <Inaudible>.


Jack, Daphne, Loretta, okay?


Or Angelo.


Yeah.  Or Angelo.  Or Angela, interesting story.  And for our regular listeners, you may remember a couple of weeks back, we had a call from Angelo who wanted to talk about gold, gold, and gold coins and so forth.  Nancy took the call she —


I was there, I was much politer than I wanted to be.


But you didn’t even know it was him.


No, it was my husband.


And she didn’t even recognize him.  I knew it was him.  I could recognize his voice and she’s talking to him for a minute and a half, talking about the pros and cons and so on, so forth.  She’s hung up the call and it wasn’t until 10 minutes later that we got talking about it.  I said Angelo, do you recognize Angelo.  She said who’s Angelo?  I said your husband.


<Inaudible> means I listen to him.




I don’t think I’d — I would be able to recognize my own wife’s voice <Inaudible>.


I <Inaudible> communication better.  Take that where you want.


So we’re going to take your calls once again.  Those numbers are 844-220-0965.  That’s 844-220-0965.  We also have the text machine up and running as well, 21232.  But let’s kick it off with today’s topic.  Nancy Hecht here to say ways to help your marriage survive retirement.


Right, right.  I mean we deal mostly with people that are at or near retirement, so there’s a lot of issues that come up that people don’t think about.  The first one is what is your vision of what your time will be like.  You know if you stop and think about it, most couples spend awake about five hours a day together.




So now you could potentially going into a world where it’s close to 24/7 together.  And nobody is used to spending that much time —


With anything or anybody.


With anybody, with anybody.




And you may love this person to pieces, but you could also <Inaudible> to dislike them very fast.  So you have to really — and that’s one question when somebody comes in and says that they’re getting ready to retire, the first thing I ask them is what are you going to do with your time.  And if they can immediately start listing off a whole bunch of things that they have planned that they want to have to do, I think that’s great.  If they say um, then the first thing I tell them is they are not ready to retire.  So I mean that is a biggie.  And then the role identities in retirement.  You know, if somebody was always the wage earner and somebody was always the home maintenance person, how are those roles are going to change or equalize or recalibrate themselves in retirement?




That’s a big thing, along with what is your identity.


How big is the couch you have in your office to get the people to <Inaudible>.


It’s big enough.  You have to pursue your own interests and maintain your separate friendships.  Now I mean — most people do that now.  They don’t spend, again, 24/7 with their spouse, and you have obviously a lot of common interest and goals.  But I’m always of the frame that your spouse is not your best friend.  Your spouse has a way higher place in my life at least versus best friend.  And you have to have other friends and interests to keep your own personal relationship with your spouse interesting.


There you go.


And something that we do and we did even when my daughter was little is have a date night, and that’s really important.  So I mean you’re not going to work, you’re not going on and doing, but —


Your life is going to have a radical change, yeah.


You know, I have a lot of friends that are now becoming empty nesters, the last kid is getting ready to leave and go to college.  And they look upon that with a little bit of trepidation.  And the first thing I say to them is A, you did the job that you were supposed to because the kid is ready to leave.  And B, now you get to date your spouse again.  So that’s another important thing to help —


The empty nester time is absolutely the best time.


Well, I am not complaining about it.


Once you get through the psychological part, because the psychological part is your child is leaving home, whether it’s the last one leaving home and then you’re looking at your life, and then you’re wondering what that’s all about and you’re feeling older of course.  And then you feel proud about what you’ve done for that child leaving home, and then when they’re no longer there and you have the house to yourself, you can do the things you want to do when you want to do them, how you want to do them. And you don’t have to worry about somebody coming home late and where are they and so on and so forth.  <Inaudible> and —


Or coming in unannounced.


Oh yes.




So we immediately turned Brady’s room into a gym.


There you go.


So there’s no boundaries <?> there.


Change the locks.




Okay.  Alright, we’ve got some calls, here, Carl.  What’s going on?


Well, we’ve got Daphne on line one.




Somebody wanted to be Daphne.


Alright, Daphne.


<Inaudible> all of the great names you put out.  Because Daphne sounded good, so we’ll do that.


Good morning, Daph.


Daphne is in Orlando.  Go ahead, you’re on with the Certified Financial Group on WDBO.


Good morning, you gave me a big decision whether to call myself Jack, Daphne, or Loretta but Daphne is good.  Thank you for that.  I will be receiving a small inheritance, $10,000 but very grateful, and from out of state.  It’s going to be coming from unfortunately from New Jersey.  And I was wondering the tax situation.  Do they retain tax, do I have to pay taxes — what —


Daphne, the good news for you, there’s absolutely no taxes due.  It’s your money, as you want to spend it.  So when the estate settled, the taxes will have been paid at that point and then the — I presume it’s coming to you in cash.


A check.


A check, yeah okay.  Yes.


Yeah, well yeah, I mean that’s it.  But as the recipient, it doesn’t matter if it was 10,000 or 10M.  As the recipient, whether it’s an inheritance or as a gift, you are not responsible for the tax.


Oh, okay.  Okay, good to know.


So now you can use this in a manner that best suits your life.  If you need to keep it as an emergency fund, great.  If there’s a trip that you’ve always wanted to do, down payment on a car, further education, whatever.  It’s yours and you do not have to worry about any tax ramifications at all.


Let me give you some ideas, Daphne.




Do you have any credit card debt?




Okay, well that may be the first you want to do is kill that credit card debt because that will help your financial situation.  And then —




And then that monthly payment that you’re sending the credit card company, do you have an IRA or a 401k that you could put money into.


Yes, I do.


There you go.  So that monthly check that writing to the credit card company, take that $10,000, okay?  Pay off the credit card debt and then you start taking that monthly check that you were sending to Visa and put it in your IRA or 401k and get a tax deduction, that’ll help your retirement.


Although, if you do not have an emergency fund, I would caution you to save part of the money that you’ve just inherited and use it as an emergency fund.


I was thinking about that.  Also, because of my age and I’m starting — we’ve had — as a family, we’ve had emergencies and we need — so I went back to work even though I retired.  I’m 69 now, and I went back to work.  I was very happy about it.  And I have the opportunity to do the 401k with my new job, so my thing is to match that to maximum and continue.  Is that a good idea?


Good, good.


Yeah, try to get the max.  One other thing that you — Nancy mentioned emergency fund.  You should have that, but you could always — usually in most plans you have the ability to borrow from your plan.  You’re borrowing from yourself as the emergency <Inaudible>.  I don’t want you to use your 401k for trivial things, but in an emergency sometimes your 401k balance, you can borrow half of your vested balance or up to $50,000, whichever is less.  So that might be an option for you as well.  But congratulations on the 10,000, use it wisely, and thanks for the call.


Well, yeah, we’re sorry for your loss.


And thank you all around and thank you for being to instructional and educating us.  We greatly appreciate it.


That’s why we’re here <Inaudible>.  Thank you very much.


Alright, thank you so much for the call, Daphne.  If you want her line, it’s 844-220-0965.  844-220-0965.  Text machine is up and running as well, 21232.  Let’s go to Anthony and St. Cloud.  Anthony, you’re up next with the Certified Financial Group here on WDBO.


Good morning, Anthony.


Good morning, guys.  How are you guys doing?




Great, how can we help you?


So I purchased a house probably about two months ago in St. Cloud for about 156,000.  We probably — the house is right now probably at 190.  So we put — just in those couple of months, we’ve got some equity there.  And we have about $30,000 worth of debt between student loans and credit cards.  And I’ve been thinking of refinancing and using the money to pay off the debt and pay off the credit cards, but wasn’t too sure.  Right now we’re at a 30 year fixed at 5% interest at 1,187 a month.


5% sounds a little high.  Is your credit score a little on the low side?


It is.  So I needed a co-signer to get the house.


Oh, oh, okay.


Yeah.  I don’t think an equity line — first of all, the length of time that you’ve been there as you just said is a short period of time.  And the amount of equity to value is not significant.  I would say if you just wait another year or two, keep plowing against the credit cards and the student loans as much as you can.  Then you’ll have more of a history of regular payments, timely payments, that’s going to boost your credit score up, that’ll have the home the ability to gain a little bit more equity.  I don’t think rates are going to go up that much more between now and maybe a year from now, or two years from now.  But if I were you, I would wait.


It’s one of the things you want to consider though because using a home equity loan or refinancing, that interest will be deductible to you.  Whereas your student loan and your credit card is not deductible.  But Nancy is right, get up a little bit more equity, have a consistent payment record and that’ll increase your credit score which could help the interest when you ultimately refinance.


Excellent.  And then what will be the process if I wanted to take the co-signer off the deed.  Would we have refinance or would it be like a —


Well that’s a — well, generally the lender isn’t going to do that because the lender wants all of the protection and guarantees that they can get.  You’d need to refinance.


Okay, so that’d be the only way?


Yep, yep.


Okay.  And then I had a question about an investment.  Have you guys ever heard of Bitcoin?






So what <Inaudible> thoughts on investing in that currency?


I think it’s the wild west.


It is.


Well, it’s the wild west.


It’s the wild west.  Have you heard of any success stories, people investing in Bitcoin?  I know they have another one, Litecoin and Etherium.


Yeah.  And listen, unless you understand it thoroughly, stay away from it.  Basically, what you’re doing, you’re speculating and there’s a difference between speculating and investing.  We work in the investment world, we try to get volatility and risk out of portfolios.  Bitcoin is a high risk, high right away proposition.


It’s the type of thing, Anthony, that you would go into if you could afford to lose every cent that you’re willing to put into it.


It’s like investing in marijuana farms, today.






You know, and the situation that you’re in, just moved in a home and all of that other stuff, I don’t <Inaudible>.


And don’t waste your money, put it in a credit card.


I don’t think you can afford to throw money away.


Yeah, stay away from what looks like get rich quick schemes because they generally are sure losers made focus on what you can control, and that’s paying off the credit card and your student loan and then refinance down the road.  Thanks for the call, Anthony.


Appreciate it, Anthony.  If you would like Anthony’s line, it’s 844-220-0965.  844-220-0965.  The text machine is up and running as well, 21232.  I do see some text questions in, we’ll get to those in a moment.  First, we got to get the three big things you need to know.  Stacy in Orlando, you’ll be up next.  We are planning tomorrow —




On News 965 WDBO.


Hey, welcome back.  This is On the Money with the Certified Financial Group here on News 965 WDBO.  We are taking your phone calls with Joe Bert and Nancy Hecht from the Certified Financial Group certified financial planners, Certified Financial Group.  844-220-0965.  That’s 844-220-0965.  You can also text us your question, 21232.  We are four minutes away from the latest news, weather, and traffic with Dave Wahl in the News 965 newsroom.  Let’s get back to our busy phone callers.  Talk to Stacy in Orlando.  Stacy, you’re on with the Certified Financial Group here on WDBO.


Good morning, Stacy.


Hi Stacy, what’s your question?


Good morning.  Good morning, I’ve been looking for a financial planner.  However, I noticed that the ones that are touted the most or see the most publications, they want a significant amount of money in order to kind of work with you.  I come from really, really modest beginnings and I know about people losing their shirt.  I get really nervous.  So when they ask me how much do I have — you know, have in my current retirement, I have about $0.25M.  But I don’t want — you’re dealing with what you don’t know and no one in your family has ever invested, it gets even more scary.  I’ve read everything about how to pick a financial planner and all of this other stuff.  I’m still nervous.  But I will say this: I’m comfortable putting $5,000 to $8,000 a month with a new financial planner, cash starting from scratch.  Do you have any advice for me?


Sure.  First, I want to take a little step back.  Are you looking for someone to do planning for you?  Are you looking for somebody to do investment management for you?


Kind of more like investment management and also kind of like help me working towards a goal as well.  Because right now I have all of my money parked.


Alright, so the way we work is we do financial planning first, looking at where you’re at now, when you want to retire, looking at life expectancy, the types of things that you want to do, the family life cycle obligations you have between here and the end.  And help you put together the roadmap, the blueprint, whatever acronym you want to use.  And then we do risk assessment questionnaire to look at your timeframe, the needs for your assets, your attitudes, towards risk, all of that helps us put together an investment plan for you.  And we would do an independent analysis on the current investments you have and then put together recommendations, also for independent investments.  We don’t have an axe to grind as far as any type investments for our clients.  We use TD Ameritrade or Fidelity both from the institutional side for housing the assets that we manage for our clients.  But we work for our clients, not for an investment company.


Stacy, the problem is what you’re doing when you talk to these folks is they want to know how big your portfolio is or your asset base is because that’s what they’re focused on, and that’s managing your money.  As Nancy said, our first focus is doing some planning for you.  The problem is that we’ve got the terms confused here.  And what you really want to do as Nancy said is to really have some plan drawn out for you because that’ll tell you how conservatively you can invest your money and still have a high probability of not running out of money when you’re 92 years old.  Unfortunately, what most people do is they chase returns, have no idea why they’re investing, what they’re investing in, what rate of return they need to be getting on their money, and they jump from this and jump from that and jump in and jump out.  And they wake up one day with like as we say, a collection of financial accidents.  So doing the planning first up-front is what’s the most important thing.  It’s like building a house without a set of blueprints.  And nobody in the right mind would try to do that but yet everybody does that in the investment world.  They go out and they start investing, they start putting up the house and have no idea what it is that they’re building for the long-term.  So that’s what planning is all about.  We charge a fee for that, and the fee is reasonable.  But it’s a function of time and complexity and how straightforward or complicated your situation might be.  But that’s why we offer a complementary consultation.  To be fair to you, to be fair with us, come in, see what we’re all about.  We’ll tell you what we do, we’ll give you an idea of what it looks like.  And then you can decide whether or not you want to hire us to guide you through the rest of your life.  That’s what certified financial planner professionals do, first and foremost as opposed to investing your money.  Now we invest and manage a lot money for our clients, all over the country.  But we strongly believe that before you invest your money, we invest your money or somebody invests your money, you ought to have a solid plan in which to work from.  And that’s what certified financial planner professionals do.


Stacy, feel free to call us: 407-869-9800 or go to our website financialgroup.com.  You could check us out and look at some of the blog posts that we’ve written, white papers, see everybody’s background to get more information.


And then the office — <Inaudible> by the office, where is that located?


Right there on Douglas Avenue just south of 434 and Altamonte Springs.


Stacy, thanks so much for the call.  Time for the latest news, weather, and traffic.  But if you want Stacy’s line, it’s 844-220-0965.  That’s 844-220-0965.  Text to 21232.


And welcome back, this is On the Money with the Certified Financial Group here on News 965 WDBO.  We are here with Joe Bert and Nancy Hecht, certified financial planners from Certified Financial Group taking your phone calls at 844-220-0965.  That’s 844-220-0965.  Let’s get back to our phone lines here, talk to Al in Orlando.  Al, you’re on with the Certified Financial Group here on WDBO.


Good morning, Al.


Hey, good morning guys.


Thanks for calling, how can we help you?  What’s up?


Thanks for the call.  Yeah, I have a question.  So I’m 35 years old and I’ve been contributing to my 401k with my company for the past 10 years.  And it’s a traditional 401k where they Match half.




Half of everything you put in?


Correct. Well, up to 4%.


Okay, okay.


Every year, it’ll go higher.


Because I was going to work for your company.




Yeah, what company was that again?


Okay, so they matched half of the first four?


Okay, got it.




And my question is, I can also contribute to a 401(k). Now I understand, Roth is where you’re kind of paying the pre-tax. What’s better in my situation at 35 years of age? Do I go with my traditional 401(k) or should I be contributing to a Roth?


My question —


First of all, what’s your income?


That was my question.


My income?




Like, yearly?




About 75.


Are you married?


I am.


And your wife works outside the home?


She does.


So, what’s your combined income? Is it over 75,000?




Okay, so you’re in the 25% tax bracket.


My question is, are you contributing the maximum that you can comfortably contribute pre-tax?




Okay, alright. And are you contributing up to the limit?


I am.


Okay, alright.


You could put $18,000 in at your age.


Oh, well, no I’m not doing that.




Probably about half.


Okay, if you can afford to save more, then doing it pre-tax in my opinion is the better way to do it. First of all, it’s whole dollars being saved for you. It’s money that you no longer will be sending to the federal government. You’ll be sending it directly to your 401(k) account. You could bump up what you’re contributing to your 401(k) and have no impact on your spendable because the money is now going to your retirement account as opposed to your income taxes, so that’s the first thing I would do before considering after tax contributions to the Roth.


In your tax bracket, Al, 25% tax bracket, let me give you an example. You put $1 into the 401(k). You’re going to save $0.25, so it really costs you $0.75. You follow me so far?


I do.


Okay, now, if you want to put a dollar into the Roth after tax, you have to gross $1.33 — take 25% off $1.33 to end up with $1. So it would cost you $1.33 to put in the $1, as opposed to putting to putting in $1 and it only costing $0.75. Now, the people like the Roth because they’re thinking one day it’s going to come out tax free, right? That’s what the current law is. Everybody understands that and appreciates that. However, nobody can guarantee you that the law will not change.


And there’s already conversation to make required minimum distributions for Roths.


The rules are changing.


Do yourself a favor. Go on the Internet. Google: Roth, A Wolf in Sheep’s Clothing.


He’s saying wolf, w-o-l-f.


Woof, woof, wolf, wolf?








<Inaudible> aggressive.


Google: Roth, A Wolf in Sheep’s Clothing and it’ll tell you why you probably don’t want to use a Roth.


If there is some type of calculator on your benefits site to see if you bump up your contribution $100 per pay, how much of an impact it’ll have on your spendables, and you should do something like that just to see how far you can push it up to the $18,000 a year contribution.


Let’s talk about — Al, if you’ve got a minute, let’s talk about how you’re investing those funds.




What do you have it invested in?


So, right now, it’s kind of crazy and everyone says it’s crazy, but I’m half in my company’s stock and then half in the 401(k).


Okay, well it’s all 401(k) money. But —


In the 401(k), <Lost Signal>


It’s like a target-fund.


A target-fund.


The other half is in the target fund.


Okay, target-date fund. Okay.


We would caution you on investing so much in your company stock.


The reason he said ugh is because 100% of your pay in benefits is dependent on the health of  your company. Do you really want to also have 50% of your retirement in that same bucket? That, in my opinion, lacks diversification. To have part of it going into the company stock is fine. You might want to take that down to maybe 20% versus 50%.


To me, that’s even high. I wouldn’t do more than 5% or 10%, because as Nancy said, the risk that you run, you’ve got everything — not everything, but a good portion of your future and your retirement, banking on how the company does. Nancy and I call tell you stories about we’ve seen clients that work for major companies one day, and the company is doing great, and the next day it’s not so good, and all of a sudden things are falling apart and you weren’t even aware of it. I think people do that psychologically, because they —


You believe, yes, and you believe in your company.




However, diversification is really important when it comes to saving and investing.


Believe me, your boss doens’t know that your money is in the 401(k) plan in the company stock, and you’re going to get a raise <?>. Believe me, some people think that as well, and that really has no bearing and they don’t have any idea or anybody is invested.


If the rest of it’s in a target fund, it’s got to be heavily weighted towards equities because of your age, which you said it’s predominantly stock and very little income-producing items. You might want to look at, for the dollars that you’re going to re-allocate away from your company stock, adding some further diversification by getting maybe into a mid cap fund or a small cap fund, maybe a little bit of foreign, so again, you don’t have all your eggs in one basket.


You guys bring a really great question up if I can ask one more question.








Okay, so if I have 50% in my company stock, it’s been yielding well for a number of years, about 10% return. I understand in the future, it could tank or something.




The money that I have that’s in that fund or my kind of that’s half of my company, can I take that and shift it into other areas?






Does that money stay there the whole time I have the start —




<Inaudible> mid caps.


When you’re re-allocating your 401(k), you can re-allocate new money and you can re-allocate currently invested dollars. One is not dependent on the other.


Wow, great advice. I appreciate that.


We do help a lot of our clients manage their 401(k)s while they’re working. It’s just part of the investment management services that we provide.


Yeah, we have the ability to help you with that. Your funds stay with the company, stay in the 401(k) plan, but what you do is you give us access to your 401(k) to manage it on your behalf. We sign off on that, we sign up as fiduciaries and we have a fiduciary relationship with our clients, and we can help you with that. So, give us a call! Thanks for the call, Alan.


Number to do that.




Or you can go to the website.




Alright, thanks so much for the call, Al. We really do appreciate. If you would like Al’s line, it’s 844-220-0965. 844-220-0965. Or you could text us your question to 21232. We do have some text questions in here, guys, and we’ll get to the workshops in just a minute, so we want get <Background Noise>


Another way for people — well, okay.


<Background Noise>


We can go for the text first.






Let’s talk to the people.


Usually, I was going to get the workshops before we get into the three big things you need to know.


Alright, fine.


Dory asks, texts or writes in: I own my home in full. I would like to take over the mortgage payments on my parents’ home after they are not able to pay or when they pass. How do I do that?


If you make those mortgage payments as I understand it, you  want to check with your tax preparer. You will start to get a tax deduction for the interest that you’re paying on that home. Even though the house isn’t in your name — and you don’t want to have the house put in your name, but I believe that there is a provision where if you’re starting to make those mortgage payments on behalf of your parents, you could get the interest deduction on that home. No addition <?> to your primary residence. I know that sounds weird, but I had read something recently and I can’t remember where it was, Nancy.


I can’t either, but yeah, talk to your tax preparer.


Yep, okay. Another text to write, send it 21232. What is asset-based long-term care?


Asset-based long-term care is the type of long-term care that I prefer to provide to my clients. Let’s take a little step back. When people think of getting long-term care insurance, often what they’re presented is the type of coverage that’s very much like your homeowners or your car insurance. You’re paying a premium. You’re contracting for a certain benefit. It is a policy, and policies can change. They can often change, much to the surprise of the policy holder. Either the premium will go up, or the benefit will be decreased. An asset-based long-term care contract is you’re depositing money — either lump sum or a combination of lump sum and annually — to buy a specific benefit. The nice thing, as far as I’m concerned, is that you have access to the cash or long-term care benefits while you’re alive. If you do not use up all the cash for either just cash or long-term care needs, then there’s death benefit that goes to your heirs. You’re expanding the use of the dollars, and it’s an actual contract as opposed to the policy. What you’re contracting for when you take it out is what you get.


The nice thing about that, and Nancy and I have seen cases where people have these annuities they bought in years past, they don’t need the income from it necessarily. It’s just accumulating there, and if you cash it out, you’re going to pay taxes. But it’s a way to convert some lazy annuity into a multiple for long-term health care. As she said, if you don’t use it, you get it back, which is the nice thing about the asset-based plans.


Right, yeah.


Got another text question here, 21232: I’m 42 and have about 363K in a 401(k). If I don’t put another dollar in, would the Rule of 72 or 76 apply?


Well, depends on <Background Noise>


Potentially. It depends on what it’s invested in and what is your factor. I mean, a lot of people still look at —


What’s the Rule of 72 or 76?


Eight, ten —


Well, there is no Rule of 76 that I’m aware of. The Rule of 72 is how long it’ll take your money to double given a certain rate of return.




So if you’re earning 6% of your money, it’ll double in 12 years. It’ll quadruple in 24 years.


So if you take 9%, it’ll double in eight years, quadruple in sixteen years. This is roughly.


Yeah, but anybody who’s using 8%, 9%, 12% as a factor, I think is crazy.




The markets have not done that well in a long period of time. I think that you should take your expectations down a little bit further. But yeah, that’s how it works.




Projecting out 8% or 9%, although the markets have done that in the past, the S&P history is 10% per year the last seven years, but don’t fail the farm on that. Gather <?> a reasonable rate of return and if you exceed it, and you’ve met your objectives, so much the better.




Alright, 844-220-0965, that’s 844-220-0965 if you’ve got a question for Joe, Burt, and Nancy. Nancy has <?> workshops coming up with Certified Financial Group.


Yes, so back to the point of a couple of callers of how do you work and stuff, this is one great way for people to come and see our offices and get some free information along generally with a meal or a nice snack, and check us out a little bit. The next one coming up is Financial Basics, Life Strategies for Success hosted by Gary Abley. This is Saturday, September 16th from 11:00 to 1:00. Myself and Denise Kovatch will be hosting our next Social Security Boot Camp Claiming Strategies from 6:00 to 7:30 on October 19th, that’s a Thursday, and we do serve sandwiches so please come hungry. Health Care Options in Retirement is Saturday, November 4th from 9:00 in the morning to 11:00, hosted by Gary Abley, and then the last one we have on the books for right now is January 6th: When Can You Retire? Know Your Number from 9:00am to 11:00am, also hosted by Gary. If you go to our website, which is financialgroup.com, you can go onto the Workshop tab. You can see when the workshops are, the dates, the times, and you can reserve your space for that.


People ask, why do we do this? We do this for two reasons: Number one, give you good information so you don’t become a financial calamity, a financial disaster, trying to show you what you need to do now so you don’t look back five or ten years form now and say, gee, I wish I’ve have known, or gee, I’m sorry I did, and secondly to introduce you to our firm. What we do for our clients, how work with our clients for a fee, and this way whether you need financial planning now or sometime in the future, perhaps you’ll give us an opportunity to earn your business. So go to our website, that’s financialgroup.com, and you can make a reservation right there online. Hope to see you there.


Alright, that’s going to do it for that. Let’s do more phone calls before we get out of here at 10:00, 844-220-0965 is the number <Inaudible>. We are planning tomorrow —




With the Certified Financial Group!




Welcome back. It is the final segment of On The Money with the Certified Financial Group here on News 96.5 WDBO. We are three minutes away from latest news, weather, and traffic with Dave Wahl on the New 96.5 News Room to give us the latest news, weather, traffic all coming up 10:00. But right now, we’ve still got three minutes left to take your phone calls or answer your questions, 844-220-0965. 844-220-0965, or the text is 21232. Just that one text to your question, Joe and Nancy from Certified Financial Group, what advice would you offer when looking for a tax preparer?


Well, I would want somebody doing my taxes that was a CPA versus just an accountant or tax preparer. I would talk to friends and coworkers to see who they might be using. I guess you would want to know, out of all the returns that somebody has prepared, how many times have their clients been audited? I mean, a lot of it is the same thing as somebody interviewing us. It’s personality. It’s experience. It’s licensing. So you just need to ask a lot of questions.


What you want to stay away from at tax time, you see those street signs that say they’ll get you so much back on your taxes; file with us, we’ll get you so much back — those are scams.


Many of them are scams.


The people flipping the signs in the street.




Yeah, they’re awful. As Nancy said, use a CPA or an enrolled agent is another good alternative. But talk to him. Find out how long they’ve been in business, and what their background is, and <Inaudible> if somebody is doing your taxes <Background Noise>


Yeah, more conversation.


Are they just a fill-in-the-blank person, or do they really want to know what your situation is and look for opportunities to save you some money on taxes?


Well, we had a lot of great callers today, and we especially had one back at the bottom of the hour who just was confused between a financial planner, and investment manager, and all that stuff. We invite her and everybody listening to just — no matter what age you are, give you guys a call with Certified Financial Group or go visit the office, phone number and location.


I had today — this week, I had a couple in for the very first time. They’re near retirement age, and she was afraid. You’ve probably seen this, too. The first time they met with a financial planner, they’re — I don’t want to say intimidated, but they’re embarrassed, maybe, a little uncomfortable about showing what they’ve done or haven’t done, that they were <Inaudible> their life that they need help. It’s putting that fear aside. There’s anything <?> that we haven’t seen in 40 years, but we’ve seen it all.


We’ve seen it all, yeah.


As I go to the priest for confession. We’ve heard it all, and we’re here to help you. We’re not here to criticize you. We’re here to clean up the mess that you might’ve made, or congratulate you on what you’ve done, but our job is to make you whole. Make you healthy, get you there, show what you need to do, give you guidance, and we charge a fee for that. Once again, if you want more information about what we do and how we do it, go to our website. That’s financialgroup.com.


And the phone number?


407-869-9800 Monday through Friday, 8:30am to 5:30pm.


And we’ll be back next week at 9:00 right here on News 96.5 WDBO.




Not me.


That was a question!


I’ll be back in two weeks.


We have been planning tomorrow —






Dictation made on 8/8/2017 11:27 AM EDT.


Hosts:  Aaron Bert, CFP®, AIF® and Joe Bert, CFP®, AIF®

Well, good Saturday morning to you, everybody, I am Kyle Fitsantra and this is On The Money with a Certified Financial Group here on News Honey 65, WDBO’s Ask the Experts Weekend.  It’s a family affair today, Joe Bert and Aaron Bert are here in the studio taking your phone calls at 844-220-0965.  Good morning gentlemen.

Good morning.

Hey, how’s it going?

How are you guys today?

Okay, how are you?

Did you miss me?

We did?

On vacation?

Yeah, you were gone.


<Inaudible> did a good job <Inaudible> but we’re glad you’re back.

Alright, well appreciate.  Well, even though Laurel was here and even though I’m back, the experts are still who they always are and they’re still taking your phone calls and text questions.  Joe, what can the audience call you about today?

Once again, Aaron and I are here to take any calls that might be on your mind regarding your personal finances as we oftentimes say, we go through life trying some of this, trying some of that, wake up at age 55 years old and find out what we have is a collection of financial accidents and one day those paychecks stop and you have to turn hopefully to savings and investments that you’ve accumulated over your working lifetime into a steady stream of income.  How do you do that?  Well, that’s what we do day in and day out, Certified Financial Group for a fee, but on Saturday morning, we are here absolutely free.  So if you have any questions regarding your personal finances, what you need to do now so you don’t look back five or ten years from now and say gee, I wish I would have known or gee, I wish somebody would have told me.  That’s why we’re here this morning.  So if you have any questions about your personal finances as they revolve around questions on your mutual funds, about your 401k, about your IRA, about stocks, bonds, real estate, long-term health care, IRAs, annuities, life insurance, reverse mortgages, or anything like that, we are here in the good news for you, the lines are absolutely — well I should take that back — we already have a call, but we still have a lot of lines.

Yeah, we’ve got plenty of lines.

All you have to do is pick up the phone and dial 844-220-0965, 844-220-0965.  Text machine is up and running as well.  21232.  Just keep it about 160 characters, that’s all we can see on our screen.  21232.  Today’s topic, kicking it off today: What you need to know before you apply for Social Security.

Well, Social Security is a very, very important part of retirement planning because it is for many people the only source of what we call guaranteed income.  Now, despite what you might hear in the newspapers or reading newspapers or hear in the radio or television about the demise of Social Security, Social Security will be there and you have to plan for what that means to your retirement income and what you need to do to get the maximum benefit that you possibly can.  What Aaron and I see oftentimes people make the wrong decision and they claim too early or don’t claim when they should claim, and forgo a lot of benefits and one of the major things is is claiming at age 62 when maybe you don’t really need to.  Some people think well, I’m going to get it now because I’m not — <Inaudible> I think it will be there when I get my full retirement age and they continue to work, and then you’re penalized because you have to give back $1 for every $2 that you earn over about $17,000.  Now, you get that on the back-end, but why get it now and then have to give it back?  Another thing is deferring your Social Security if you possibly can until age 70.  Because what’s the benefit of that, Aaron?

Well, right now you defer an additional 8% for every year you defer from age 66 until 70, so technically by waiting, you’re going to get a 32% larger benefit by waiting until 70, plus any cost of living adjustments that you get.  So there’s a lot of strategies that go into Social Security and that’s one of the things that we discuss with our clients when we sit down and do personal financial planning with them.  Because we try to figure out a way to maximize their benefits so that they have more guaranteed income through their retirement years.

What we oftentimes recommend is that they use some of their assets between their retirement age and age 70.  But people look at us sometimes like we have three eyes because why should I not take my income?  Well, if you’re in reasonably good health, what we like to do is guarantee as much income as we can in those out years because you never know how savings and investments is going to turn out when you’re 75 to 80 years old.  You want to build up that guaranteed income.  Plus, the surviving spouse oftentimes ends up with a higher benefit if the principal worker was collecting and then the surviving spouse takes over his or her benefit.  So there’s a lot of stuff that goes into Social Security and we do that day in and day out.  And we’ve got a call this morning, let’s take it.

Absolutely, we can get straight to our phone lines this morning, 844-220-0965.  844-220-0965.  Those are the numbers.  Hayden Windermere dialed up.  Hayden, go on, you’re on with the Certified Financial Group here on WDBO.

Good morning Hayden.

Good morning, when I retired a couple of years ago I rolled over a 401k to a IRA and my 401k was with Fidelity, so I just rolled it over to Fidelity IRA and it was all pretty simple.  But my wife has a 457, she’s retired, with ICMARC <?>, and she also has a traditional IRA with Vanguard, so I was thinking about rolling the 457 into the Vanguard account, keep it fairly simple, and I’m just curious about the 457 if there’s an precautions or differences in rolling over say a 457 than a 401k.

How old is your wife?


Okay, and do you plan on taking distributions from the account right away?

No, I’ve been taking distributions out of my IRA but not really hers.  We don’t really need to.

Yeah, <Inaudible> in your particular case you can do that, roll the 457 into the IRA, and just treat it like an IRA and then you have to take your required distributions at age 70 and a half out of the IRA.

Now, for our listeners out there who are wondering why I’m asking about age, if you’re younger than the 59 and a half then it obviously you may not want to roll it into an IRA because then you could take money out of the account and not have to pay that 10% penalty.  So that’s why I asked the question about her age and whether they’re taking distributions.


But if she’s over 59 and a half, there’s no reason not to be able to roll it right into an IRA and <Inaudible> basically consolidate your account.

There is a provision for 457s to avoid that 10% penalty I believe if it’s — if you’re 50 or 55 — I have to research that but I know there’s something that applies  specifically to 457s about that.  Do you remember if it’s 50 or 55 Aaron?


See, if we were in our office we’d look it up immediately.  But we are smart enough to know that that’s an issue, that if you came in with a 457, we would want to talk about.  But you have another question, go ahead.

Well, it’s related to that but when you initiate the rollover, do you do it from the originating end or the — where the money’s going to, would I go to Vanguard and say, start a rollover from this ICMA account or do I have to go to ICMA and initiate a rollover that way?

You would need to go to ICMA and initiate it because it’s a retirement plan so they’re going to have to verify that she’s actually separated from service to allow for the rollover to occur.  I would contact your ICMA representative or call the 800 number, whatever local number they have for you.

Alright, well thank you.

Alright.  Thanks for the call.

I appreciate it Hayden.  Thanks so much.  If you want Hayden’s line it’s 844-220-0965.  It’s 844-220-0965.  Talk to Aaron and Joe Bert here in the studio today.  457s, they are —

Just like a 401k.

Just like a 401k.

Generally used in the government entities, school teachers have them, municipal employees have them, yeah, 457.

So if you’re a government employee and you don’t have a 457 and you’re looking at all this and saying okay, what are these numbers mean?  Where, they’re similar to an actual 401k.

Yeah.  There are different types though.  They’re generally referred to also as a deferred compensation plan, another term, and there are some that when you initially sign up, you’re contractually obligated to withdraw some sort schedule in the back-end.  But with the government plans it’s not usually the case.

Yeah, you’ve got to be careful because there’s a lot of those legacy 457s out there that Aaron said that when it comes to retirement age, <Inaudible> it locked in, they want to not give you a lump sum but do you have to take it out over a certain period of years and those are pretty much going by the wayside.  But those plans are still out there.  So we have 401ks, 457, 401a, 403b, all those things with fours in them usually relate to deferred plans where you can have the money coming in your paycheck on a pre tax basis and let it accumulate — a tax deferred basis but when you withdraw it, of course, it is taxable to you.

Alright, well we got our next caller here at 844-220-0965, Mary Lou in Orlando.  Mary Lou, you’re on with the Certified Financial Group here on WDBO.

Mary Lou, good morning.

Hi, I’m 55, I can retire in five years from my federal job but I don’t want to do Social Security until 70.  So then I’m going to be at the point do I stay at a higher income job for a shorter period of time or do I switch over to a lower income job and do that for 10 years.  How do you calculate out so you can figure out what’s the best thing to do.  And my higher income job is stressful.  I would like to drop the stress.

So your question is if you stick with a higher income job does it benefit you for Social Security purposes?

Just the retirement overall because I do want to stress and wait and take my Social Security at 70 but I don’t want to work at the higher income job until 70.

So you want to retire from your stressfull high income job at 60 and then basically work part time until 70, delaying Social Security as long as possible, is that what you’re —


Well, you are actually — I don’t know the answer to that.  You are what we call the perfect case for financial planning.  Because really, it depends on what your lifestyle is and what your spending habits are and what debts you have and what other assets you’ve accumulated, and all those things go into making that determination about whether or not you can stop when you want to stop and go to a less stressful part time job from 60 until 70.  A big thing in that too is going to be health insurance as well, so we have to make some assumptions about what you’re going to do from 60 until you go onto Medicare age unless you have health care through your federal job, I don’t know the answer to that.

I do.  So the health care is off the table, I’ll be good with that.

That’s super, that’s super.  So again, it’s going to depend on what your assets are and your spending and whether or not that the lower income job is going to be able to to help get you to age 70 or maybe you can spend down some of your assets in the process as well. I’m assuming you’re going to have a pension as well from your federal job.

Yes, I will have some pension.

Mary Lou, you are, as Aaron said, a prime candidate to really have this laid out before you make that decision to drop that high income.  You, like most of us, get in your later years and you’re in your prime earning years like an athlete and you walk way from that income too soon and I can tell you in the number of plans that we’ve done over nearly four years, the difference of socking away some extra money in those — in your high earnings years makes a huge differences when you’re 80s and early 90s.  So what I’m saying is that if you can do that, that could be worth several thousands of dollars to you, a multiple of what you’re earning in your later years.  So really what we want to look at is what is your spending, what do you plan to do in your retirement years, in those golden years, how about travel, buying cars, what impact does taxes and inflation have on that decision and how long will your money last.  Then most importantly, how conservatively can you invest your money and still have a high probability of not running out of money at your life expectancy.  The toughest cast that we work on is I’ve said before is folks that made the — back of the envelope financial planning and only estimated what their spending and what they’re going to get from Social Security, in your case, a pension, and they walk into our office for the first time, six years into retirement, and the wheels are coming off because they forgot about a lot of stuff.  The other dangerous thing to do is go online and do these do it yourself calculators because the assumptions that you plug in there sometimes are difficult to discern as to really what they’re asking, and sometimes they’re not detailed enough to generate the right numbers that you need to have.  They’re kind of fun to play with and get you in the ballpark, but I wouldn’t bet my retirement years on something that you do online by yourself.  So that’s what we do day in and day out, Mary Lou.  There’s several certified financial planner professionals in the Orlando area.  We’d love to talk to you.  You can find our website at financialgroup.com.  Come in, we’ll offer you a complimentary consultation, and we’ll tell you what our fees to do this analysis for you and then when it’s done you’ll have a higher degree of confidence and make that decision that you’re going to be okay.  Appreciate the call.

I appreciate it.  Thanks so much Mary Lou.  If you would like Mary Lou’s line, it’s 844-220-0965.  844-220-0965.  Joe Bert and Aaron Bert are certified financial planner at the Certified Financial Group.  What’s the best number to reach you at during the week, guys?

You can call our office or better yet, go to our website, financialgroup.com, but if you are unable to get to the Internet, our phone number 407-869-9800, or 1-800-execute, as if you’re executing a financial plan or a legal document.

There you go.


Now the best thing is our website.  You can put <Inaudible> all about us, see our smiling faces, learn about upcoming workshops.  We’ve got one coming up here in — when is it?

Next workshop we have on the calendar actually is the Countdown to Retirement, that would be — we’ll, actually I guess that’s ones past.  We’re going September, Financial Basics.  It’s September 16th from 11:00 to 1:00 at our office at 1111 Douglas Avenue, which is right in Altamonte Springs at the corner of 434 and Douglas right of I-4.

This is a lunch time workshop, 11:00 to 1:00.  What’s the date?

September 16th.

September 16th, as hosted by Gary Abely, CPA, certified public accountant professional.  He will be hosting that in our office.  Once again, leave your checkbook at home, he’s not going to try to sell you some product and convince you that that’s the end all, be all to retirement years.  He’s going to give you good information to help you avoid those pitfalls that we often see people fall into as they try to make decisions as to what to do with their retirement assets.  So once again, go to our website, financialgroup.com.  That’s financialgroup.com, and click on there and you can make a reservation right online.

Alright, we’ll we got a couple of text questions in here, 21232, if you text them we’ll answer it <Inaudible> we get.  The three big things we need to know.

Welcome back to On the Money with the Certified Financial Group right here on News 965, WDBO’s Ask the Experts Weekend.  We’ve got Aaron Bert and Joe Bert here from the Certified Financial Group taking your phone calls at 844-220-0965.  That’s 844-220-0965 or your text questions 21232.  We are about three minutes away from latest news, weather, and traffic with Dave Wahl in the News 965 Newsroom, so let’s get back to your text questions here.  Let’s see here, let’s start with the first one here:  I’m 44 with a 401k, 30K for the last five years, what can I do to be more aggressive in max return in 20 years?  For a max return in 20 years I’m sure.

Well, it’s really depends on what options you have available within your 401k plan.  We always talk with people who have 401ks that there’s two things that will make you successful within your 401k plan and that’s having quality and being broadly diversified.  So what we generally recommend for people is that they don’t try and choose individual investment options within their 401k or try and build their own portfolio, so I would turn to either a target-date fund within that 401k plan or a model portfolio, a risk based portfolio if they have those options available.  And if you want to be aggressive, choose the aggressive one.  And if you want to do the target-date option, chose the date that is the furthest out because that’s going to be the most aggressive now and get more conservative as you approach that date.  So really, those are the two options within your 401k plan to be the most aggressive.  Now, whether that’s appropriate for you, obviously I don’t know because I don’t know your situation.  I have 150 to go off of here.

That’s it.

But the other thing you can do to maximize your return in the next 20 years is to maximize your contributions to your plan.  Because you have to put money into the plan, you can’t just rely on it, $30,000 to grow over 20 years.  Yes, it’s going to grow and it will be a nice sum of money, but if you want an even nicer sum of money, you need to maximize your contributions.  So at age 44, the maximum you can contribute under current law is $18,000 a year and then when you hit 50, the government says you don’t have much time, and they allow you to put $24,000 in under current law.

Alright, Aaron.  I have another one for you here regarding the 8% increase per year on delaying Social Security, does it increase pro rated each month or each year?

It is monthly.

Simple enough.  Can I lend $50,000 to a relative for 12 months without charging interest?  Does this have to be reported to the IRS?

Well there’s — yes — the answer’s no.  It’s —

The answer’s no.

Well, really what happens is that if you lend somebody money and don’t charge interest, and if you’re audited, the government’s going to come back and do what’s called the imputed interest, which is a — they’re going to tell you what the interest rate is based on the circumstances of that loan.  Is it a secured loan, yada, yada, yada.

So it depends on what it is you’re trying to accomplish here.  If you’re trying to not charge this person interest, then the way to do that is to charge them interest and then to gift that interest rate interest back to them.

Oh, back to them.

Now, if you — once again, if you charge somebody interest you have to recognize that interest has income and you have to pay taxes on it.  Then just gift it back to them and you’ve eliminated that.  Another way depending on what it is you’re trying to accomplish — I wish we had this person on the phone — but there’s another way around this depending on what the family situation is and if you’re lending it to your son and his wife and you and your wife want to do this, you can give $14,000 a year per person.  So let’s say you want to — let’s say this is your son and his wife and you and your wife want to give them — they can give them $56,000.  And it’s not a gift and its not — don’t have to pay taxes on it.

<Inaudible> as a gift.

Yes.  Well, you don’t have to report it as a gift, just <Inaudible> — it is not a loan.  So that’s a way around it depending on what circumstances are.

We’ll continue this on the other side.  Texter, if you want more information, give us a call, along with anybody else.  844-220-0965.  Got a nice long segment to answer all your questions.  844-220-0965.  Text machine is up and running as well.  21232.  We are planning tomorrow —

With the Certified Financial Group on News 965 WDBO.

Welcome back to On the Money with the Certified Financial Group here on news 965 WDBO’s Ask the Experts Weekend.  Joe Bert and Aaron Bert are here in the studio today taking your phone calls at 844-220-0965.  <Inaudible>.

We’re here to answer any questions that’s on your mind regarding your personal financials.  We go through life trying some of this, trying some of that, making financials decisions, without really any idea how it impacts our long-term financial security.  That’s one of the worst things you can do.  So we’re here to clean up the mind fog if you will and the good news for  you, the lines are absolutely wide open so you can jump right to the head of the line because there is no line.

That’s it.

And I keep saying all you an do is dial these numbers, we don’t dial the phone any more.  That’s an old habit that’s hard to break.

No, no, no, technically you do dial on your cell phone.

Is that what this <Inaudible>

You still dial.


Well, you don’t dial around the rotary, but technically by pressing the dial tones, you are dialing.

I’ve been corrected.


Alright, here we go.

Good idea <Inaudible>.

Dial these numbers: 844-220-0965.  844-220-0965.  Just because we don’t use the rotary any more, I think technically now with all the changes when you press something on a dial tone, you’re dialing.

You’re dialing.

I had to change that a little bit.  Things can change.  Text machine’s up and running as well.  21232.  We have a texter before we went to the break here, talking about giving somebody a loan.


And <Inaudible> created a lot of things, so we just wanted to clarify on some of those things before we go.

This individual wanted to know if they could give — make a loan to a family member, it makes no difference, for 50,000 The difference for $50,000 and not charge interest. Now, you can do that. Unfortunately, you have to deal with what’s called imputed interest. The IRS assumes that nobody’s going to do this for free, and they will tell you how much interest you should’ve charged, and you have to recognize the interest income on your tax return. However, if your intention was because you didn’t want to recharge this individual interest, you can charge them interest and then just gift them back the interest that they paid. However, you have to recognize that interest is income. Then as long as the gift that you’re giving back is under $14,000 per individual, you’re okay. Now, if your intention is to just make this a short-term situation, and if it’s — I used the example of mom and dad want to give son and daughter-in-law $50,000, they can each give $14,000 per individual times two, up to $56,000 and not have any gift tax implications or income tax implications. Then if it’s a short-term deal, then son and daughter-in-law can turn around and gift the money back to mom and dad.


So, there’s a way to get it back and not have any taxes, and not have any gift taxes to deal with. So, depending on what your situation is, there may be a way around it. That’s what we do as financial planners, day in and day out, try to figure out strategies to keep you from falling in those pitfalls, pit holes, or whatever. Fox holes, or problems, or whatever. Right?

Pot holes.

Pot holes, that’s it. That’s what we’re talking about.

Don’t want to fall in a fox hole.

Okay, fox hole. We’ve got a workshop coming up here, one time here in September.

We’ve got one coming up in September that’s the financial basics, and then the next Social Security workshop, actually, is October 19th in our office. That’s an evening one from 6:00 to 7:30. That one’s hosted by Denise Kovatch and Nancy Hex. That’s an evening, October 19th, where they’re going to talked about Social Security claiming strategies. That’s another very popular workshop that’s coming up in our office in Altamonte Springs.

So, for more information, just go to our website, financialgroup.com. That’s financialgroup.com, click on Workshops, and then you can make your reservation right there. We hold this in our big classroom. We save our video equipment and audio equipment, and seat about 25 people comfortably, so just come on by.

Alright, we’ve got the phone callers in here. Again, 844-220-0965. Start off with Austin Longwood. Austin, you’re on the Certified Financial Group here on 96.5.

<Background Noise>

Hey, good morning. Thanks for taking the call. Hey, so, we listen to your show quite a bit, and we’ve gotten a ton of advice from you guys from this show, and we really do appreciate it. But my wife and I — mid to late 30s — and as much as advice as we do get from you, we were just talking that it might be time just to come in and make an appointment with you guys to come in and start talking about 401s, and Roths. You know, we — it’s just all very confusing with everything changing, and how much money will we need when we retire in 30, 40 years? But my question is, when you get new clients such as us, mid to late 30s, how much time do you usually tell your clients to come in? Like how often do we meet, typically with a financial planner, and how long will those consultations typically, but — how often do we come in? Is it once a month? Is it once a year? How does it work?

Well, the starting point is to have you come in and look at how complex or straightforward your situation is. What you’re after, you talked about retirement, so what decisions you need to make now in terms of accumulating assets, where should we invest it, how aggressively it should be invested based on what your time horizon is to begin with drawing from those funds. We have you come in, we look at your situation, and then we’ll put you in all-in one-time fees to do the planning for you. Then what happens is that you have an objective. You know what you need to do, and we give you this plan. We walk you through it, and we say you need to do X, Y, and Z. Then we presume that you’re going to continue doing that. Now, we know as life goes on, good stuff happens, bad stuff happens. Then if you were a planning client, we want you to pick up the phone and come back and see us. It’s like going to your doctor. You get your first physical. You’re in good shape. Here’s what you need to do, maybe take these blood pressure medication, or exercise, or diet, or whatever it might be, and we presume that you’re following what the doctor has prescribed. Now, if you find out that — heaven forbid, you have a stroke or that something happened that really changes or disrupts, either good or bad. Because we’ve had lottery winners as clients as well. Pick up the phone, come on in. You’ve got to make big decisions about buying a house or that kind of stuff, come on in and we will update your plan. Now, if you are what we call a wealth management client, that you have then hired us to manage your money going forward, then there is no charge to that update. So, you are welcome to come in and see us as need be. We take calls every day from our clients that have questions and family issues they have to deal with, but we serve as your pilots, if you will. We’re flying the airplane. We know where we want to go. We know how to get you there, and we’ll get you there through good times and bad. Do you want to add anything to that?

I mean, if you’re comfortable and nothing’s changed in two years, do I need to come in? No, I mean, as long as you’re doing what you should be doing —

As long as I’m doing that!

Yeah, and then as we said, stuff happens. Good stuff and bad stuff. If you want to fine tune your plan, then usually the best time to do that is on a regular basis every three to five years if nothing’s happening.


And particularly, as you’re getting close to the retirement years, making those big decisions.

I mean, we know what your income is. We set up savings goals, and we know what you’re going to spend, and then basically as long as you’re meeting your savings goals and the accounts are invested appropriately, things will drag along.

Things will be good.

There’s not a need to come in every month to see if you’ve really met your budget for that.

You wouldn’t go see your doctor every month. Even though your account is going to go up and down, there’s no reason to come in. I don’t know if that helps you, Austin.

Yeah, I mean. But the last question is, I mean, we hear a lot of the callers that you guys get. Are we behind the eight ball now?

No! No, no, no.

Okay, okay.

No, you’ve heard the stories that have come in, so —

No, you’re in the sweet spot. Because of your age, you’ve got the greatest asset, which is time. The thing is, most people don’t realize what an asset that is until they get in their 50s and say, I’m running out of it!


So, you have time and time is a great asset if you use it wisely.

Yeah, the earlier you start, the easier it becomes.

And you would really be the exception. We’re seeing more and more younger clients today, but the bulk of our clients are those folks that the kids have gone off, they’re married, and the college is all done, and they’ve had the weddings and all this stuff, and now mom and dad are, like I say, sitting around the kitchen table. And they’re looking at each other, 55 years old, and what are we going to do?

And their 20-something children are watching that conversation take place and go, I am not going to let that happen to me.

You know, that’s what I hear, too, from the younger ones. You know, I see what my parents are doing and how they might be struggling, and how they made bad decisions. I don’t want to have that happen.

Right. It’s interesting that you see more younger people, because I think — even around here, I’ve got more 19 and 21-year olds interested in retirement plans than I’ve ever seen. It’s really interesting.

Let’s get back to our full lines here, talk to Ken! Ken, you’re on the Certified Financial Group on WDBO.

Good morning, Ken.

Good morning, thank you for taking my call.

Of course.

My question has to do with a real estate transaction and taxation, and if you guys aren’t comfortable talking about this — it might be a CPA question — then I’ll understand.

Well, we’ll try it. Go ahead.

Okay, so a bit involved. December of 2012, I bought a house primarily for my youngest son. At that time, I did not want his name on the deed or the mortgage.

Okay, so you bought the house, it’s in your name, and the mortgage is in your name?

That’s correct.

And he’s just living there?

He’s living there, right, and we signed a lease purchase agreement at that time, stipulating that in perpetuity, that he could execute the purchase agreement. But all of the lease payments he made to me would apply towards the principal balance of the home.


So, now we’re four years later and I want to sell the property to him. I’m hoping that the way we’ve done this is, we can set the sale price without an adverse tax consequence because the home was purchased at a bargain four years ago, and now it’s worth a lot of money. My question is this. If I sell him that property now, and if I sell it to him for the same price I purchased it for, understanding that that price would be less than its value in the market today, will I incur a tax consequence on that gain just the same, or will he have the tax consequence — an adverse tax consequence. Later on, it’s going to be his primary residence if he sells the house.

The liability is going to be on your end, because basically what you’re doing: Let’s say you bought it for — just to make  this dramatic here — let’s say you bought it for $10,000 and say it’s worth $1M, and you want to give it to him for $10,000, okay?


That, right up front, doesn’t pass the smell <?> test. So what’s going to happen is if you’re ever audited, the IRS is going to come along and look at the fair market value, the comparables, and determine that you have in fact made a gift to your son of that difference. Now, the good news is there’s some way around that. That takes a bit of creative planning, but that’s where you want to get together with a CPA. There is some strategies that you can use, but there is a way around it. To answer your question bottom line, there could be some tax implications if you just sell him the house based at what you paid for, assuming it’s gone up. Okay?

Okay, yeah, thank you very much. I really appreciate your help in that.

Thanks for the call. Bye, Ken, thanks so much. What we do on Ken’s line, it’s 844-220-0965.

I was just thinking, too, that if you just gifted it to him, which you could always do, again — he’s going to inherit the basis for which you purchased that property. So if you sell it to him — and if you sell it to him for what you bought it for, obviously that’s going to be his purchase price, too, for his basis for owning that property. But Joe is right, the difference between the fair market value and whatever it is that you sell it, if it’s under market value, it’s going to be considered a gift in the eyes are the IRS.

Yeah. Now, here’s an option. You could gift in the house at fair market value. Alright, now you have to file a gift tax return. You wouldn’t have to pay a gift tax because of the exemption that’s involved, and let’s redeem it with multi-millions here. Then, you could have him pay you and your wife $28,000 per year, if he’s married, between him and his wife, $56,000 a year, or some lesser amount until it’s paid off. If you gift him the house, the house is his free and clear. He could go out and get a mortgage, and do what he wants to do in that regard. So, there is some strategies that are available to you, but I don’t want you going out just gifting it to him, as you plan, because you could end up running afoul of the tax consequences.

Alright, 844-220-0965 is the number to join us. We’ve got one more segment left. We are coming up again to the break here to get the three big things you need to know. Text is up and running as well, 21232. What’s the best number to reach you guys during the week?

Best number is 407-869-9800 or better yet, go to our website, financialgroup.comfinancialgroup.com.

Yeah, you can join Austin, who’s going to make an appointment to come see us.

There you go.

Alright, time to get the three big things you need to know: We are planning tomorrow —


— the Certified Financial Group on WDBO.

This is news 96.5, WDBO.

This is the last segment of On The Money with the Certified Financial Group here on News 96.5 WBDO. It’s your last chance to get your question answered at 844-220-0965. Joe Bert and Aaron Bert, here live in the studio, taking your phone calls and your questions. Joe, you wanted to circle back to one of our callers, right, we had right before we break.

Yeah, I’m going to circle back to Kent who had the question about gifting a house to his son. We had an astute caller text us, and the caller is right because I totally overshot that fact that they had a lease purchase agreement. If he has a lease purchase — Kent, I hope you’re listening — and you had locked down the price at that point, that’s what the sales price is, regardless of if they found oil on that property. Your son was the lucky winner. So if your agreement was to sell it to him at that price, I think you’re okay.

That doesn’t mean that that’s fair market value four years ago, too, right?

Well, yeah — yes, yeah, which I think was the case.


So, once again, I want to thank our listener that texted us. Kent, I hope you’re listening, and I hope that didn’t confuse our listeners too much.

Alright, no worries. Alright, let’s get back to our phone line here. Hayden has been hanging on. Hayden, go ahead —

Sorry about that.

— You’re back again with the Certified Financial Group on WDBO.

Good morning, Hayden, welcome back.

Hi, thought I’d get my money’s worth today about Social Security. My wife and I both turned 62 today, but we both have a pension and we can withdrawal from our full IRA, so we’re going to delay taking the Social Security. I had a couple of analyses done I thought I’d run by you their results. They showed, as a higher earner, I should delay until 70 and maximize my benefit than a survivor benefit for my wife eventually. But for her, the lower earner, they showed her maximize a lifetime benefit by her collecting at 66, and then at 70, when I collected, she would get an additional spousal benefit. So, instead of both of us delaying until 70, they said she should collect at full retirement age around 66, and then I would delay until 70. I wanted to see what y’all thought about that strategy.

That sounds correct, so I’m assuming that her benefit is less than half of your benefit. Correct?


Yeah, okay.

That was one — yeah, her benefit is 66 with about 1,100. Mine is about 3,500 at age 70 is what it’s showing.

Now, she’s going to collect half of what you would have collected at 66, not at age 70, so she’s not going to get half of your age 70.


I mean, that makes sense. Unfortunately, you’re passed the point where you’re — they changed the laws regarding Social Security claiming strategies a couple years ago, an you are unable to take advantage of, really, most of them except for this particular one where you just claim on your own benefits, and then she’s going to get a bump when you go claim at 70. So, yeah, that sounds accurate to me.


If you can afford to do that, it always makes sense for the higher earner, assuming your health is good, to delay as long as possible. For you, that would be age 70. Then there’s no advantage for your wife not starting at age 66, so she ought to do that as well. So yeah, you’ve got some good advice there.

Alright, appreciate Hayden. Thanks so much for the phone call. We’ve got one last text question here: Parents want to give me 5K against mortgage principal annually. Wants to write check to bank, not me, how does that figure as a gift?

They don’t have to worry about it. As long as they’re under <?> $14,000, you can write that check to pay down the mortgage and it’s fine.


No gift, no income, no <Background Noise> right?

Oh, piece of cake. That was easy.


Yeah, alright.

We like easy.


Well, now we’ve got 50 seconds left, so now you’ve got to plug some more workshops here. For workshops, we have a September workshop coming up, Countdown to Retirement, Planning for Retirement. That’s going to be a daytime workshop, 11:00 to 1:00 in our office in Altamonte Springs just south of 434.

Yeah, that’s the Financial Basics, September 16th. That’s with Gary Abley, again, 11:00 to 1:00 at our office, Financial Basics. And again, all these can be found on our website if you go to financialgroup.com. We’ve got a little workshops thing, and all of the workshops are there as well. Gary’s also going to be hosting a Healthcare Options workshop, so if you’re interested in claiming strategies for Medicare or any other health care questions, that’s November 4th, and that’s from 9:00 in the morning to 11:00. I believe that’s a Saturday.

Mmhmm, there we go. Alright, just like that, that’s going to do it for this week’s addition of On The Money with the Certified Financial Group. We have been planning —

Tomorrow and today.

Oh, tomorrow I missed, sorry.

Come on, <Background Noise>

I forgot tomorrow! Man, I almost got it! Ah man.

We’re planning tomorrow today.

Tomorrow, today!


And we’ll do it again, next Saturday at 9:00 right here on News 96.5 WDBO.

Dictation made on 8/1/2017 12:23 PM EDT.

Hosts:    Nancy Hecht, CFP®, AIF® and Joe Bert, CFP®, AIF®

– Hello everyone, welcome to On The Money with certified financial group, a part of the new 965WGBO. Ask the experts weekend. We’ve got Joe Bert and Nancy Hecht here. They’re a certified financial professionals and certified financial group and they’re here taking your calls. That’s 844-220-0965 is the number to call in. 844-220-0965. If you text your questions at 21232. Good morning, everyone.

– Hello.

– Good morning.

– How are you guys doing today?

– We’re doing great. It’s good to be here, and we are live this morning. So unlike some previous shows, we are here live to take your calls. So if you have any questions regarding your personal financials, Nancy and I are here to take them. So as we say in our ads, people go through life, trying some of this, trying some of that. Looking at retirement and we want to try to figure out how they’re going to supplement their Social Security so they can enjoy those — at least <?> call them the Golden Years. And and we say on Monday through Friday, we do this for a fee, but on Saturday morning we do it absolutely for free. So <Inaudible> questions regarding your personal finances as they may relate to decisions that you’re trying to make about stocks and any real estate and long-term health care and your IRA and annuities and your 401(k) and reverse mortgage, life insurance, all that and more, Nancy and I are here to take your calls. And the good news for you is there’s absolutely no one in line so you can jump right to the head of the line because there is no line, by dialing these magic numbers. And they are:

– 844-220-0965. Or again, you can text to 21232. And Nancy, you’re here to talk about — you have some workshop you’re going to tell us about, and then you’re here to talk about it’s not about the income, your income and spending.

– Right. Okay. So the upcoming workshops are on Saturday, September 16th from 11:00 to 1:00. Financial basics like strategies for success, hosted by Gary Abley. Social Security boot camp claiming strategies from 6:00pm to 7:00pm on Thursday, October 19th, hosted by myself and Denise Kovach. And House Care Options in Retirement, Saturday, November 4th, from 9:00am until 11:00am. Also hosted by Gary Abley. And the last one on the books is When Can You Retire? Know Your Number. Saturday, January 6th, from 9:00am to 11:00am, hosted by Gary Abley. If anybody wants to register for one of the workshops, if you go to our website: financialgroup.com, click on the workshops and you’ll be able to reserve your spot.

– Right there. That’s financialgroup.com. People ask us, so why do you do this kind of stuff? We do it for basically two reasons:

1. So we can avoid some of those financial disasters that we some time see coming in our office that folks that haven’t prepared or unfortunately had made some bad decisions going to these free lunch and dinner seminars. They’re trying to fix those situations. And secondly, to tell you what we do as financial planners, as certified financial planner professionals, and how we may be different from all those folks out there that are just trying to sell you another indexed annuity, so. Once again, go to our website. That’s financialgroup.com. As we have a call here from Timothy. Laurel <?>.

– Yeah, Timothy’s got a question about paying on the mortgage and the interest, if it helps at all. So hang on, let me get Timothy here.

– Go ahead, Timothy.

– Hi Timothy. What’s your question?

– Good morning. So, I was told that if I pay my mortgage, split it between the middle of the month, and at the end of the month, it lowers the interest overall rather than one big lump payment at the end of the month.

– <Inaudible>

– Yeah. What you’re doing here is you’re making double payments.

– It’s called bi-monthly mortgage payments. It’s actually how I happen to pay my mortgage. And what you end up doing is knocking years off of the total length of the mortgage. Therefore, paying less in interest payments. So you’re not lowering the interest rates, per se, but you could knock it by making bi-monthly payments. You end up making 13 payments a year, so you could knock potentially about 10 years off of the life of your mortgage. Now, depending on who you have your mortgage with, there may be a small fee for doing that. You know, maybe $2 a month or something to set it up. But I happen to think it’s a real easy way to pay your mortgage and pay it off easier — or faster, excuse me.

– First of all, depends on where you are in the mortgage cycle. You’ll save the most if you’re early on the mortgage cycle, particularly with 30-year mortgage. But yea, it does by making extra payments, that does, as Nancy said, reduce the amount of interest that you have to pay, but it doesn’t necessarily reduce your interest rate.

– Timothy, how far into your mortgage are you?

– I believe this is the second or third year.

– Oh, okay. So you can definitely benefit by — how long do you plan on staying in the house?

– Mmm. Let’s say 10.

– Oh, okay. That’s fine. Yeah. So, if you set up bi-monthly payments, you could knock a chunk off —

– Actually, semi-monthly.

– Or semi-monthly. Semi-monthly payments, you can knock off a chunk from the end. So, I’ve been doing it for years. It’s easy. It’s mindless. Saves you money.

– Excellent. And I don’t know if you have other callers. I’ll definitely defer to the next caller, but if you have a moment, I just have another question.

– Go right ahead.

– So, recently I did cash surrender value on a whole life policy — a life insurance policy. And my understanding of it is if you paid more into the premiums, then the amount you receive back is the cash surrender, then you don’t — there’s no tax obligation. Is that accurate?

– Yes, it is. Yes it is.

– So let me be sure I understand your question. If you pay in more premium than you got back, there’s no tax consequence.

– Right. So, over the — let’s say if–

– Yes, you pay the 10,000, you got 5,000, and you got 5,000. There’s no taxes on the 5,000 because you didn’t make any gain on the 10,000 that you put in.

– Okay <?>. Perfect. That makes total sense.

– Very good.

– Excellent. Thank you guys so much for your help today.

– We appreciate your call.

– So once again we got some lines open here for you. 844-220-0965. 844-220-0965. Or you can text us at 21232. That’s 21232. And Nancy, you were saying.

– Yeah, Laurel had alluded to a topic that — it was a topic of discussion this past week. It goes back like you know 20M years when I first started in business, there was a guy that had said if I only could make X number of dollars, all my problems would be solved. If I only had so much money. You know, and that’s so much an X number of dollars is different for everybody, but the problem is not the income. The problem is how you’re spending it. And that’s the part of the equation that people don’t look at.

– Yup.

– You know, I had done the Father’s Day thing and advice from your fathers, and I would say probably 75% to 80% of the fathers had advised their children live below your means.

– Exactly.

– And make sure that you save something for yourself.

– Yeah. That’s the ultimate challenge.

– Yeah. You know, everybody thinks if I win the lottery, or I can get this huge bonus, if I just had more money, and that’s the wrong side of the equation to be looking at. You have to look at how you’re living your life and how you’re managing your cash flow.

– Exactly.

– And making sure that you have an emergency fund.

– And the secret is as you know it’s to pay yourself first.

– Exactly.

– Discipline yourself. Set aside that money, and then spend what’s left. Unfortunately we try to save what’s left, and at the end of the month there’s not much left.

– Exactly. Exactly.

– Alright. Cindy has a call here, right, Laurel? Put her through.

– Yeah, Cindy has a question about her daughter’s 401(k). Go ahead, Cindy.

– Hi. My daughter recently switched jobs and she transferred her 401(k) like she was supposed to directly from  one company to the other. But then she got a check in the mail for $365 from the 401(k) company that she was with. And she doesn’t know what to do with it.

– Cindy, ask your daughter if she had made a Roth or an after tax contribution to the 401(k). Because if it was not a pre-tax dollars, then it would not transfer over into the new 401(k). So anything that was after tax — if it was Roth, or if it was an after tax contribution, that is just paid out. And if there was no earnings on that $365, then it’s not taxable.

– Okay. Could it be possible that this is just something that paid in after she left the company? They took it out from her last check?

– It’s possible, but I don’t think so.

– Yeah, probably not.

– <Inaudible> it probably has something to do on after tax contribution that they made. What they did was they rolled over all the pre-tax and the earnings on that money. And it’s probably some after tax contribution of somehow made for her. What I’d look at is the pay stub and see if anything was withheld, because the rule is if money comes out  of a 401(k), if it’s not directly transferred to the new custodian, they have to withhold 20%. So if there was nothing withheld, chances are that’s her money, and it’s free and clear.

– Okay. Alright. Thank you so much.

– You’re welcome, Cindy. Thanks for the call. Here we go.

– Okay.

– All right, Laurel. We’ve got a text question here.

– All right.

– I have several rental properties, each in a separate LLC. Would I need a different brokerage account for each LLC in order to preserve my asset protection. While the LLC stands on its own, if in fact you are sued, however — if the LLC is sued, that LLC stands on its own. Because if you have rental properties, that’s  why many <?> peoples put their rentals in individual LLCs because if somebody tripped and fall on that property, they’re going to sue the owner, and the LLC owns it and so on and so forth. But you as an individual, your LLC is one of your assets, and there is no asset protection per se in an LLC. So if you have a car wreck, and an LLC is an asset in which you own, then that LLC is subject to claims of credit <?>.

– Okay. But the question is would I need a different brokerage account for each LLC–

– It doesn’t do anything.

– In order to <Inaudible> — yeah.

– I don’t see how that does anything. I think his real question is is what — I think he or she is laboring under a false impression that the LLC gives him asset protection. It only gives you asset protection in terms of what activity that LLC is engaged in. So if you’re sued for something else, and you own the LLC, then the LLC is subject to claims of predators because it’s an asset of yours. Okay? That is it. Another text question. DTI was very high. 50,000 in student loans, deferred 10,000 in carded <?>  loan. 657 credit score. Pay on student loans or eliminate the $10,000 in debt first?

– <Inaudible>

– Do you understand what DTI —

– I have no — debt to income.

– Yeah. Very good. That’s very good. Okay.

– Yay for me. Not that I could read it, but anyways. If the student loans have been deferred, and the credit card is probably compounding at a decent rate, I would try an attack that first.

– Yup.

– You want to go for the higher interest and get that knocked off, and then go to the next highest interest thing. If you can manage both of them and don’t do one to the detriment of the other — maybe do one in favor of the other, but still paying a little bit towards the student loans. But if they’ve been deferred, knock off the high interest.

– Yeah. The biggest thing that a credit scoring agency looks at is your loan payment history. So you want to keep those loans current, and that will increase your credit score. As Nancy said, if in fact the student loan is deferred, I’d tackle the $10,000 of credit card debt. So that would do. All right. We’re going to take a break here. Once again, we’ve got lines open at 8 — what’s our number here? 844-220-0965.

– 844-220-0965. This is On The Money on News 965 WDBO.

– Welcome back to On The Money here on News 965 WDBO. If you’ve got questions about your investments, retirement. If you’ve got money questions, give us a call. 844-220-0965. Again, 844-220-0965. You can text in your questions to 21232. And I know Nancy you have a listener question. We also have Angelo on the line. Let’s talk to Angelo.

– All right, Angelo, go ahead.

– Angelo, good morning.

– Good morning, good morning.

– How can we help you?

– So I have been reading this stuff that says that the price of gold and silver has going through the roof pretty soon, and I can start buying these gold coins from this company that gets delivered to my house. I know I can put them in my IRA, apparently, or I can just keep them in a safe. And I’m wondering how long do you think it’ll take before this is worth a whole lot of money.

– Well, first, if you buy gold through one of those services, you have to overcome the unbelievable mark-up price. It goes to them.

– Really?

– Yes. Yes, you do. So, a lot of people buy gold as a hedge against stock and bonds. It’s good to have a diversified portfolio. If I have gold as one of the allocations for my clients, I’d buy it through an exchange traded fund that purchases 100% gold bullion. Angelo, I’ve been watching silver since 1983. And really, not a whole lot has happened with the price of silver, and the way you’re looking at buying gold, to me, is not the most effective way. Just my own humble opinion. Because it is an extremely expensive way to buy it. You may not be getting 100% pure gold in the coins. It may be gold clad. And you wouldn’t know that until after the fact. Again, it’s not a bad thing to have as a small portion of your portfolio because it generally works in opposition to stocks and bonds, but I’m not a fan of buying gold in that method.

– Angelo, Nancy’s 100% right on that score. In fact, a better way to buy that is just to buy the gold itself. We can buy for our clients. We buy it at 2% over the spot price. You can have it held by a third party custodian for 1% per year, and you know that you’re getting real gold, and not the big mark-ups. One of the things you really want to stay <?> from are these companies that promote this gold that you see on TV–

– And that’s exactly what he’s talking about.

– They want to sell you these coins.

– Right. Right. And that’s what he’s talking about.

– What they want to sell you is the new ismatic <?> coins. The collector’s coin.

– Right.

– Now that’s the real mess <?>. So Angelo, you’re smart to just stay away — you’re smart to call in, number one. And number two, take Nancy’s advice as I assume you always do.

– But if you want a little bit more information, please go to our website financialgroup.com and you can throw a question in on there, or get information about purchasing it for the 2% over as Joe just mentioned, so. Thank you.

– Thank you, Angelo.

– All right, we have Mark on the line now, too, and Mark wants to know what to do with his annuity.

– Hi Mark, how are you doing?

– Good morning.

– Good afternoon. How are you doing?

– Good. How can we help you?

– What’s your question?

– Good morning. My question is I’ve received two annuities from my father when he passed away, approximately $100,000. My question is can I better serve to put that money towards my mortgage to pay it down, or to use part of it to pay it down and leave a little in reserve to pay the taxes on it next year?

– Well, first of all, let’s be sure — were they IRA annuities?

– No. They were straight annuities.

– Okay. How much gain is in the annuities? That <?> you only have to pay taxes on difference between what he put in and what it earn.

– <Inaudible> I don’t know. <Inaudible>

– That’s the important part of the equation.

– And the permanent you think <?> you want to use is cost basis. What is the cost basis? What was deposited versus the market value? Are you the only beneficiary of these annuities that you’re discussing?

– Well, there was sort of myself and my two brothers, and we each got separate checks.

– I see. Okay. Oh, you were cashed out already?

– I’m sorry.

– You were cashed out?

– Yeah. Yeah, I already cashed <Inaudible>

– Wow. So the horse is out of the barn.

– Okay. So, Jeff, what you want to find out is how much is taxable versus not. And were any taxes withheld prior to getting the check?

– No, they weren’t.

– Okay.

– I elected to have the <Inaudible> of paying this without any taxes.

– Okay. All right. It’s important for you to withhold whatever might be necessary to pay your taxes next year. And then you thinking about paying down your mortgage?

– Correct.

– Okay. And then it’s a home that you plan on staying in for five years or more?

– Yes.

– Then I think that that’s a great idea, and it was a wonderful gift that you got from your dad to be able to help you do this.

– Let me ask a couple more questions, Mark.

– Okay.

– What I might look at — did you have a retirement plan?

– Yes. I do. I’ve got a 401(k) through my company, both Roth and  traditional <Inaudible>

– If you can hang on through the break, I want to get back to the question. All right? We’ll talk to you on the other side of the break.

– Awesome. And if you got questions you need answered. We’ve got a whole half an hour. 844-220-0965. This is On The Money on News 965 WDBO.

– This is On The Money right here on News 965 WDBO where we’re answering your questions about your money. IRAs, retirement, mortgages, whatever you got. 844-220-0965 is the number you need to call. Get your questions answered and we have open lines. 844-220-0965, or text us in your question to 21232. I know we have a couple text questions to get to, but right now we are talking to Mark. Right, Joe?

– Yes we are. Good morning, Mark <Inaudible> thanks for sticking around. Let’s get back to your situation for our listeners that just might’ve tuned in. You inherited some money through an annuity from your father or grand father, and you got about $100,000, you said?

– Correct.

– Okay, and at this point we don’t know what the tax consequences on that as we said to you earlier. You’ll have to pay taxes on whatever gain might be the difference between what was invested and what you got will be taxable to you. So whatever’s left, your question was should you pay down your mortgage, and my question back to you was: Do you have a 401(k) or retirement plan, and your answer was yes, I believe.

– Yes. And I’m almost 60, so I’m getting close to retirement.

– Okay. Are you putting in the $24,000 per year that you’re able to do?

– I’m <Lost Signal>

– Oh, you’re breaking up, Mark. You’re breaking up. You there?

– I’m sorry. I’m putting in 12% to 13% so.

Okay so if you’re earning a couple hundred thousand dollars a year, that’s 24,000.  But if you’re — if the actual dollar amount that I want you to focus on.  So at your age, you’re able to put in $24,000 per year.  Forget your percentage.  And does your wife have a retirement plan.  Does your wife work outside the home?

No she does not.

Okay, so depending on your incomes, I’d want you to focus on maxing out your 401(k) plan.  Use some of that money to fund your 401(k).  Now you can’t write a check to your 401(k), but what you can do is reduce your paycheck, and so you just live off the annuity money that your not bringing home, because you increased your 401(k).  And secondly, if you wife doesn’t have an IRA, then you can set up what’s called a spousal IRA, and assuming she’s the same age, you’ve got $6,500 a year you can put there.  What’s the interest rate on your mortgage, Mark.

I just — we just bought the house.  So it’s, I think 4.2.

4.2.  And what’s your income?  What’s your tax <Inaudible>

Income is over 80,000.

Okay so, so your probably in the 15% tax bracket.  Your effective rate on that mortgage is probably in the range of about 4%.  I like the idea of getting a <Inaudible> deduction, because you’re going to save immediate money, and that money will <Inaudible> in a tax deferred basis.  Some people like to pay down the mortgage, and know that’s behind them.  You know, and maybe you do a little of each.  What do you think Nancy?

Well yeah, I mean put a little bit towards paying down the mortgage, and then pay roll deduct more directly to your 401(k).  And then Joe’s suggestion is one that is a nice one.  Paying yourself that income out of the annuity.

For our listeners.  Go ahead.

Yeah, no, and we’ve been talking about the difference, and you’re going to have to pay taxes on the gains.  Gains from annuities are taxes, ordinary income.  They’re not taxes <?> capital gains rate, so that’s an important factor too.  So that could potentially be at a higher rate than you would pay.

For our listeners that might not be familiar with what the options are when you inherit an annuity, if it’s an IRA, there’s an ability to do what’s called a stretch <?>, if you’re a spouse, you can defer the taxes.  But in your particular case, it was not a retirement plan.  It was just a pure straight annuity.  The options that you had were to defer cashing it out for up to five years.  So that’s an option.  If you don’t need the income now, and you’re going to be in a lower tax bracket five years from now, you may have done that.  And there’s a new program out now that we just uncovered that will allow you to, if you’re in the first year, to take those annuity, or actually do a what’s called a 1035 exchange.  And exchange the annuity directly into another annuity, and do what’s called a stretch.  And have that income paid out to you for your lifetime, and you can get substantially more benefit from that as opposed to paying the taxes right up front.  So everybody’s situation is unique.  Just want to make you aware of the options that you have when you do in fact inherit an annuity.

Appreciate your call Mark.  Thank you.

Thank you for hanging on Mark.  Alright so we have a text question.  Just opened a taxable mutual fund in March, and I find my return is higher than my Roth IRA as the 5,500 limit restriction is bottlenecking it.  So my question would be — if I was actually talking to this person is, what is the taxable mutual fund invested in, versus what the Roth IRA is invested in.  It’s not a function of the title or the type of account.  It’s account function of the investment vehicle used.  I’m going to guess that the taxable mutual fund is all in equities, stock-based mutual fund.  And the Roth is probably a combination of stocks and income, or maybe all income.  And that’s why the return that the return is seeing is higher.  It has nothing to do again with the title of the account, it has to do with how the assets are invested.

And you may just want to consider, if you’re looking for a higher returns, just convert that Roth asset into a similar type of account that you have in the other account.

Just changing the underlying portfolio.

Yes, yup.

Keeping the Roth title.

Yes, thank you.

Alright another text here.  I’m over 70 and a half, and I began taking RMDs, required minimum distributions last year, but am still confused if I must take an RMD from all IRAs, as I have several IRAs with the same company.  You have to take your required minimum distribution based on the 1231 Balance of all of your IRA accounts.  However, you don’t have to take withdrawals from each individual account.  If you have say five different accounts, and last years balance was $15,000 in each.  And you had to withdraw 6% of the total to meet the required minimum distribution, you could do that all from one, or you could do it from — part from any of them.  The important thing is, is that you withdraw the proper dollar amount.  It doesn’t necessarily matter where it’s coming from, just that the proper amount is withdrawn.

Yeah, and that’s something that we do for our clients on a regular basis.  For those that are clients that 70 and a half, we had a system set up to notify them, and to be sure that they are in compliance.  Because the penalty for that is 50% of what you should have taken out plus taxes.  So you’d end up with very little after the IRS is through with you.  So it’s a very, very important number to know and to stay on top of.  So we can do that.  And you had another listener question.

Yes I did.  I did.  When is the right time to create a will?  Okay, so the right time to create a will is when you have stuff.  When you have stuff.  And a lot people think, oh I’ve done my estate planning, I have a will.  A will says this is what I have to the public, and if you have any claims against me, now is your time to do it.  If you want to keep your affairs private, a lot can be accomplished through titling of assets, as opposed to putting everything you have in a will.  If you have different banking accounts, checkings, savings, money market, and it’s joint with somebody, you can add a transfer on death, in-trust for type of designation on to the title.  And it will go from the account owners to the beneficiary without probate, which is an important thing, a will subject to, to probate in the state of Florida it starts at 3%.  And it will keep your things private.  We know that with retirement accounts and insurance policies, you’re automatically naming a beneficiary, so you want to make sure periodically that your beneficiaries are current.  There hasn’t been a life change, death, divorce or a primary beneficiary or a contingent beneficiary.  We talked a couple weeks ago about an ex-spouse getting all the proceeds.  There was an article in the paper, somebody hired somebody to kill their husband for life insurance proceeds.  And he had never changed the beneficiary to the new wife.  So, she ended up in jail, and broke.  So you want to check your beneficiary designations.  Make sure that you have contingents on there also.  And put stuff in the will, like, you know the furniture, and the jewelry, and all those other little types of items.

The crystal and the.

Those are the types of items that create fights in families when people pass on, so you can make a list that is long as is necessary with an item and a persons name attached to it.  So wills are important.  I think the overlooked will is the living will, which says how you want to be taken care of if you cannot speak for yourself.  You want to make sure that somebody is given durable power of attorney to act on your behalf.  Either you can do one for financial only and health only.  You can give the durable power of attorney for financial and health to one person.  So there’s a lot of estate planning to be on the will that are important, but when you got stuff, you got to make sure it goes where you want it to go, and titling can accomplish a lot of it.

Yeah, a lot of people think that, you know they get lazy about changing the beneficiaries on their IRAs, their 401(k)s as you said, and the annuities, the life insurance policies.  And they think, we’ll I just did my will, that’s going to take care of all that.  Nope.  It doesn’t work that way, because that beneficiary designation overrides anything that might be said in a will or a in a trust.  So it’s very important.

And having absolutely nothing done is not nice for your survivors.  As my father-in-law passed away almost three years ago without a will, and we’re still dealing with it.  So.

Alright we have a text question here.  If someone had the assets, does the cost basis defer to the cost on data transfer?  The answer is yes.  In other words, if you bought something for $50,000 and it’s worth $100,000 today, and you decide to give it away, that cost basis transfers over to the donee.

It’s called the step-up in basis.  That’s the term that we’ve used.

Like that happens in death.

Okay.  Your right.

You know and that’s a good point.  I was referring to a lifetime transfer.  If it’s a lifetime transfer, there is no step-up.  But at death, that’s one of the benefits of dyeing, is because the step-up, or your survivors get a step-up in basis.

Right, right.  Which reduces the taxes.

Right, right.

Okay, alight.  Lines are wide open.  844-220-0965.  That’s 844-220-0965.  You can text us at 212-322-1232.  And Nancy the next workshop coming up is I think Gary Abling in September.

Right, right, Saturday, September 16th from 11 to 1:00pm hosted by Gary Able Financial Basics, Life Strategies For Success.

Yeah, in that one, he talks about what you need to do now so you’re prepared as you approach those retirement years, because we don’t potentially think about it until it’s staring us right in the face.  And the best time to do the planning is when you don’t have to make immediate decisions.  So Gary is a CPA, as well as a certified financial planner professional.  And he’s going to give you some great information.  Once again, if you’d like more information about that workshop, or any of the other upcoming workshops at Nancy, and certified financial planners, that CFG host, you can go to our website, that’s financialgroup.com.  That’s financialgroup.com.  Click on our workshops.  You can make a reservation right there.  You can also learn about Nancy, and me and the other certified financial planner professionals that make up the certified financial group.  So once again that’s who we do day in and day out.  We’re about to take a break and we’ll be back right after.

Alrighty, and like he said if you’ve got questions now’s the time to call, 844-220-0965.  Again, 844-220-0965 or text us 212-232 this is on the money, right here on news 965 WDBL.

Thank you so much for listening to on the money right here on news 965 WGBO.  This is our last segment, but we are back every Saturday, 9:00am to 10:00am.  I know my days.  9:00am to 10:00am, answering your money questions.  Alright Nancy, you had a couple points you wanted to make before we wrap it up here.

Right, we had gotten a question about what is there new to look forward to for Social Security in the coming years.  So one nice thing is that there is going to be an increase for recipients of 2.3%.  It’s the largest increase in a long time.  And first of all, last year was the first increase in 10 years.  2.3% is not quite keeping pace with inflation, but it’s getting awful close to it.  The offsetting thing that’s not so great is the amount of dollars that we have to pay Social Security tax on is also being increased.  It’s going from $127,200 to $130,000 next year.  And I would imagine we’re going to see that creeping up every single year.  One big change I would love to see that would maybe stop the taxability increase, is maybe the deferral rate at 8% getting lowered to maybe 6% or 5%.

Meaning the credit that you defer?

The deferral credit.  Yes.

So why don’t you explain what that is.

Full retirement age is creeping up, and soon full retirement age for a lot of people is going to 67.  So any year that you defer beyond full retirement age, you get an automatic 8% bump in what you will receive.

Per year.

Per year, and you can do that depending on when you meet full retirement age either for four years, eventually, it’s going to be only for three years.  I don’t know any place that is unequivocally guaranteeing an 8% increase for three years period.


And the federal government should not be doing it, in my opinion, and I think if it was a 5% or 6% guarantee that would still be an awful nice guarantee that would save a heck of a lot of money from coming out of the trust fund.  And maybe allow the interest and the body of the trust fund to last a few years longer.

The non-existent trust fund, but it’s out there and paid for.  So yeah.

Well, yeah.

But you’re right, I think that — I think part of the tax bill coming down is going to remove the cap on income, or really substantially raise it in terms of what goes into Social Security.


So the higher income folks won’t be paying more into the system to provide us some solvency.  I guess it’s projected the 2030, ’34, ’35, is when if we don’t make nay changes, that they’re going to run out of funds.  And Medicare and Medicaid is an even worse shape than that.  So things have to be adjusted because they can’t go on at this rate forever.

And people panic when they hear that.  It’s going to be gone, but the prediction is that those of us paying in are going to be able to pay for the people that are receiving.  So the money will go into Social Security system, and them automatically be sent out.

Yeah, the real challenge is you’re going to have more people on retirement than are paying into the system, which is real —

Right now we have three workers for every one recipient.  And that number is going to go down.

Yup, and I think I know those three personally.  So let’s.  Keep it up.

I used to personally know the people that I was paying Social Security for.  So, but you know, we have a lot of information on this.  The next Social Security boot camp is in October, and there’s a number of other workshops coming up, as I had mentioned.  If you want more information on the workshops on us, we have planner blogs that you can go and read.  Just go to financialgroup.com, financialgroup.com.  If you want to take advantage of the complementary consultation that we offer to all of our listeners, you can just click on that to make an appointment.  There’s a ton of information we have.

There are calculators there, you can figure out what your RMD is if you know what you’re balance was on December 31st.  You can plug that in, and plug in your age, and it will tell you what your required distribution is for this year.  So there’s all kind of good stuff as Nancy said on our website, financialgroup.com.  That’s financialgroup.com.  You can sign up for the workshops.  You can see Nancy and my smiling faces, along with the other certified financial planner professionals that work with us at the certified financial group.  So we’d love to see you.  We do this day in and day out for a fee, but then a morning, as we say, we do it for free.  We’re glad that you were able to join us.  And once again.

I think I — one thing that I find interesting on the website is if you go on the information to know and planner blogs.  Because you get an idea to see how we think.  You know what are our attitudes are about the particular topics that we’ve chosen to write about, and what are thought process is.  And it’s a great way to get an insight as to a particular person or a planner, and the topics that we have as top of the brain from speaking to our clients, and speaking to the listeners on the radio.

Yeah, the info to know section is particularly important, because that — we have some white papers on there to describe some of those things that you’re advertised, and almost found too good to be true, or that theses free luncheons.

Like the coin.

Like the coin.  Or the free luncheon, dinner seminars that are touting these special kind of annuities that promise you everything including the kitchen sink.  So if you want more information, once again, go to our website, that’s financialgroup.com.  Financialgroup.com  and we’re just about ready to wrap up.  We want to appreciate your time this afternoon, as Nancy said.  You can reach us on Monday through Friday at 407-869-9800.  That’s 407-869-9800.  Or you text it or e-mail either one of us.  Nancy@financialgroup.com or Joe@financialgroup.com.  And that’ll show up right on our desk.  We’re glad to answer any questions that you might have.  So once again thanks for joining us this Saturday, and we’ll see you next week.

Dictation made on 7/26/2017 2:43 PM EDT.