On the Money Transcript

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.


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

Good afternoon everyone, welcome to On The Money with Certified Financial Group, part of the news 96.5 WDBO ask the experts weekend.  Joe Bert and Denise Kovach are certified financial professionals from the Certified Financial Group and they are here taking your calls.  844-220-0965.  That’s 844-220-0965.  Of course you could always text us your questions.  21232.  Good morning everyone.


Good morning.  How are you?


I’m good, how are you doing?


Good.  We understand your father is a long-time listener to our show, so good morning to Laurel’s father who may be out there listening this morning.




Well Denise and I are here to take questions that your father and all of our listeners might have about anything that’s 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 to find out we have nothing more than a collection of financial accidents and some day those paychecks are going to start and we have to figure out how are we going to get the income that we want to maintain the lifestyle that we hoped and dreamed about in our what they say golden years.  Your questions oftentimes revolve around issues about stocks and bonds and mutual funds and real estate, long-term health care, IRAs, annuities, life insurance, reverse mortgages, all that and more.  And Monday through Friday, Denise and I and the other certified financial planning professionals at CFG do this for a fee, but on Saturday morning we are here absolutely free.  So if there’s anything that’s on your mind regarding your personal finances, things you’ve been thinking about, questions that’s you’ve always had, wonder how this works, can I do this, can I not do that, we are here to take your questions.  And the good news is for you the lines are absolutely wide open and you don’t even have to use your real name, you can pretend you’re Jack or Daphne or Loretta or whoever you want to be, and we’ll take your call.  So the lines are wide open, right Denise?  We are here.


We are.


And all you have to do is pick up those phones and dial those magic numbers, once again Laurel:


844-220-0965.  844-220-0965.  And Denise, I understand you’re here to talk to us about bad habits that are going to ruin our retirement.


Yep.  Joe was just talking about that.  Some people make some mistakes as they approach retirement.  First of all, you don’t want to treat retirement as the destination.  It’s actually the beginning of the next part of your life.  And it’s really easy for people who are still working to think of retirement as an end goal, but it really is a mistake if you only concentrate on reaching the finish line.


So people — let me stop you right there.  So what we see is people say, at 66 I want to retire.  That’s all they think about.  They don’t think about the remaining 20, 25 years.


The fuel to keep them going.


Right, exactly.


Absolutely.  So people need to keep in mind that retirement could actually last longer than your working career, so you need to have assets that are going to last.  I’ve even had clients say to me, I plan to retire in a year or two, so I think I need to invest much more conservatively.


I hear that all the time.


You do?




I thought it was just me.


People think — they don’t want to lose any money because obviously they can’t go back and replenish it.




But what they don’t realize is I think what you’re about to tell them what happens when you get really really conservative in your retirement years, what <Inaudible>.


I’m going to talk about that.  Portfolios, Joe, as you know, the may need to be tweaked, but it’s certainly not time to put on the breaks.  And having said that, don’t avoid investment risk.  Reducing volatility and lowering risk in retirement may make sense, but not everyone can afford to buy only CDs or low yielding bonds for the rest of their life and still maintain their desired lifestyle.  Inflation is a huge factor, and it will destroy any conservative investment strategy given enough time.  I think that’s where you were going with that.


Yeah, I think most people fail to realize that over time the cost of living will absolutely go up for you, and I think the challenge is that people, when they retire, as you’ve probably seen, they come in with a rough estimate as to what it costs to live, and until we give them our detailed living expense form that has virtually everything on it including the termite <?> bond, they don’t realize really how much it costs to live every month, every year.  And then what they don’t realize is that that cost will definitely increase over their retirement years.  And it’s easy to look at where you are today, because you have that information.  Usually it’s incorrect or incomplete information.  And then, well, I have so much coming in from Social Security and maybe from my pension and I get so much from interest or dividends.  But then, what happens five, ten, fifteen years down the road when the cost of everything has perhaps doubled and you still have the same income, and that is a problem.


I remember years ago I used to work for a Datsun <?> dealership.




Uh-huh.  Remember Datsun?




A barbarian <?> auto house is what it was called.




And they had this beautiful yellow 240Z on the showroom floor, and I mean, it was beautiful.  What do you think that thing cost?


What year?


I think it was 1976.


1976, my guess that that car probably cost about $8,000.


Less than that.




Yeah.  You try to buy a car today like that —


You can buy a used Yugo for that.


So another — let me get back on these bad habits.  And we’ve talked about this before, Joe — many people think that they’ll spend 70% to 80% of their previous salary in retirement, but is this really the way to build your budget, right?  What I would suggest is put together a list of necessary expenses, and then add additional expenses that will benefit you, and for each cost, ask yourself if spending that money will actually make your life better, or is the expense there just because it’s always been there.  And even so, another thing you can do is a couple of years before you do retire, once you get this budget done, live on that budget.  See if it makes sense for you.


That’s a good point.




Yeah.  You have this theoretical spending plan, see if you can really do it.




And that includes the vacations that you want to take, the dining out that you want to do, the stuff that you want to buy.


The stuff.


The stuff.  It’s the stuff that accumulates, I know.


And don’t go into retirement thinking that retirement will solve all of your problems, because that’s not going to happen.  Yeah, you’ll have less stress and more free time, but retirement may bring about some other challenges you didn’t have when you were working.


Such as?


Declining income.


Oh yeah.


Loss of health insurance.




And perhaps increased health care costs.




You don’t want to carry any problems you had while you were working into your retirement, so fix them now.  Or you burn out from work, find another job.  No time to pursue your passion, find the time to become more productive.  If you don’t live a balanced life now, there’s no guarantee that your retirement will be any different.


For sure.


And finally, don’t stop being active.  Stay fit and healthy, both physically and mentally.


And even — people retire, they say — well maybe they don’t like their current job, they can’t wait to get the hell out, excuse my French, but you really need to be doing something in those later years, even if it’s volunteering or being a Walmart greeter or bagging groceries at Publix, just to get out, to be with people and to feel that you’re productive in some way, shape, or form.  It’s good for you physically, it’s good for you emotionally, and I think people need to focus on that.  That doesn’t mean that you can’t kick back and relax — and get something that accommodates your personal lifestyle.  If you like to sleep late or whatever it is, then find the position that you don’t have to start until noon or something.


My husband’s already — he’s semi-retired, as you know.


Uh-huh.  We know.


And he’s already on me saying, you need to figure out what you’re going to do when you retire.  I’m like, I’m not retiring.  He says, you just still need to think about it.


Figure out.  That’s right.  Where are you going.


I’m going to pull out my charcoal pencils and start drawing again.


There you guy.  Hey, that’d be pretty good.


I love to draw.


Oh, I’ve never seen your work.


Yes you did, I drew a picture of my dad —


Oh yeah, yes, yes, yes, yes, yes —


And I posted it on Facebook.


Yes, yes, yes, yes.  Incredible.  Yes.  Very good.  Alright, we’re here, folks, to take your questions about anything that might be on your mind regarding your personal financials.  As you enter those retirement years, think about retirement, all those things that come across your mind, the health care — those are the toughest challenges that we deal with when we’re doing planning for retirement and somebody wants to retire before they’re eligible for Medicare.


I tell you what, it’s pricey.  I don’t know —


It’s very pricey, very pricey, and people don’t realize the impact that that has, so you have to plug that into the numbers and see what happens, and oftentimes it makes sense to work a little bit longer, get closer to that Medicare eligible age, or get into Medicare before you retire.  But once again, the toughest cases that we work on are those folks that already made that irrevocable decision, I’m quitting, I’m out of here, I’m going to get my Social Security at 62, only to came in to our office for the first time five or six years into retirement when the wheels are coming off and say, help me.




And those are very, very difficult cases.  So folks, if you want financial planning, that’s what Denise and I and the other certified financial planner professionals at CFG do for a fee, and we are here this morning to take your questions absolutely free.  So if you have any questions about anything that’s on your mind regarding your personal finances, once again, we are here, the lines are absolutely wide open, I think everybody’s out enjoying the beautiful weather this morning, Laurel.  So why don’t you give them the numbers.


Okay, we’ll do it a little slower just in case they missed it.  It’s 844-220-0965, again 844-220-0965.  Or if you’re a little shy and you don’t really want to call you can text us your questions.  Text those to 21232.


There we go.


There we go.  Or e-mail.


Or e-mail us.


You threw out that there — we talked about our living expense form that we give to clients when we do planning for them.  I think you would be happy to send that to a client if they are a prospect or a listener that may want to see exactly what you have to consider in your retirement years.  So why don’t you give them your e-mail address and they can contact you and you can send that out to them this week.


Again, Joe is referencing a personal expense summary that we use.  It lists the various expenses that you may have now and in retirement.  It’s very thorough, so if any of you want to try to put together your budget for now or for retirement, simply e-mail me at denise@financialgroup.com, and I would be happy to send that out to you.


There you go.


I had a — it wasn’t a client, in fact he was a long-time listener, came to see me this week, and he came in with his tail between his legs kind of licking his wounds, and unfortunately he retired from a civil job, and when he retired I told him what I think he ought to do, and he unfortunately ignored my advice and put all of his money in gold.




Yeah, he did.  And now he has a disaster on his hands and wants to know what options he has available to him.


So the actual metal.


Well actually it was in his retirement plan.  He bought —


So it’s being stored in a vault.






And now he’s underwater and he needs income and he realizes that this was not such a good idea.  Now whether it was gold or Yahoo stock or whatever it was, the key here is, as you know, is diversification.  Betting the farm or the ranch or your financial future on one particular kind of investment — I don’t care what it is, real estate, gold, mutual funds, I don’t care what it is — is a mistake, because you need diversification, because any particular point in time something is going to outperform or underperform, and if you have a whole bunch of that underperforming stuff when you need the income, therein lies the problem.


And bringing up another subject within an IRA, I was speaking with somebody recently that had a lot of real estate in her IRA.  I mean, a considerable amount.  Of course a little bit of cash there too because of the expenses and whatever, but when you do that, the liquidity that you need when you have to take your mandatory distributions may be problematic.  So that’s something that you and I might need to talk about a little bit.




So people understand that.


People like real estate as an investment because it’s tangible, you can drive by, you know what’s there, you believe it’s never going to go down in value, and you want to own it because you don’t understand other investment alternatives, and so many people put real estate in their retirement plans, which is fine.  But you bring up a very valid point: if you’re loaded up on that particular non-liquid asset, when it comes time to make those required minimum distributions at age 70 and a half, you need to be sure that you have enough cash flow to meet those distributions.  Otherwise, you’re going to be into a forced liquidation at perhaps the wrong time.




So once again that gets back to diversification and why it’s so very, very important.  We’re going to take a break here I see, Laurel, with the fingers in the air —




That’s the signal, that’s the radio signal I got —


That’s — yeah, that’s the signal.


<Inaudible> we got it.  Okay.


Hey Laura <?>, you need to put your hands in the air a little higher.


Wave.  Sorry, my arms aren’t as long as Kyle’s.  I’ll jump.  Alright.  You’re listening to On The Money with Certified Financial Group.  If you’ve got questions about retirement, about your finances, now is the time to call because we’ve got open lines.  844-220-0965.  844-220-0965.  Or you can text us: 21232.





That’s it.


That’s it.  Alright.


Planning tomorrow today.


Welcome back here, you’re listening to In The Money right here on news 96.5 WDBO.  We’re here for you.  You’ve got financial questions, you’ve got retirement questions, give us a call: 844-220-0965.  Certified Financial Group here.  844-220-0965.  Or text us: 21232.  We’ve got Joe Bert and Denise Kovach here, and we want to talk to Jane.  Jane’s got a question about wills versus trusts here in Florida.


Good morning, Jane.


Good morning.


Hello, Jane.


Good morning.


Good morning.  How can we help you?


Just would like to know what’s the difference between the will or a trust here in the state of Florida?


Ah, it’s pretty much —




Sure, it’s pretty much the same all over the country.  It’s not just unique to Florida.  A will, what the purpose of a will is to pass the assets on to your survivors the way you want them passed.  So you designate I want this to go to Mary, I want this to go to Jim, I want this to go to whomever, and that’s what a will does.  And a will is used to pass on the assets that are in your name alone.  Now that being said, let’s look at the different ways in which you can own property.  If you own property in joint tenancy with right of survivorship, okay, that’s going to pass on to the survivor without going through probate and regardless of what your will says.  You follow me?




So let’s say — let’s take an example.  And I’m not an attorney, by the way, although I play one on the radio as you can tell.  But I want you to get legal help for this.  Let’s say that you have a home and you want to leave that to your daughter, but you own that joint tenancy with right of survivorship with your husband.  You pass away, your husband gets the house, regardless of what your will says.  And that joint tenancy with right of survivorship overrides whatever your will says.  Okay?  Now, let’s say that you own the home or some property or some investment accounts and you want to pass that on to your daughter.  You can do that through the will.  If you do that through the will, it’s going to go through probate, it’s going to be time and it’s going to be expensive, or you can put it in a trust.  When you put it in a trust, that avoids probate.  Trusts are free from the probate court.  So it’ll pass on to those survivors, and you can become creative in trusts.  You can say, I don’t want Jane to get this money until she’s 30 years old and has a college degree and has to buy a house, or whatever you can think of that’s legal, you can put strings attached to it.  You can also avoid assets going through probate, as I said, by jointly owned, by having a beneficiary named, and that’s typical in an annuity, in an insurance policy, in an IRA, in a 401(k), in a 457, in a 403b where you name a beneficiary.  Whatever that beneficiary is, that avoids probate, and also regardless of what your will says, if you say I want to leave my 401(k) to Mary and your 401(k) beneficiary says that your ex-husband’s going to get it, your ex-husband gets the 401(k) money regardless of what your will says.  So that beneficiary designation is very, very important.  And the last way to avoid probate is to have accounts that are not retirement accounts, not IRAs, not insurance policies, not annuities.  Let’s say you have an investment account, you can do what we call a TOD.  What’s that, Denise?


Transfer on death, which means that upon your death, your assets transfer directly to the beneficiaries that you have designated.


Right.  And that’s another way to avoid probate.


It is, but going back to the trust, another different between the will and the trust is that if you have a big — well, we’ll talk about this when we come back.


Alright, we hear the Beach Boys.  We’ll get back to you, Jane.  Hang in there.


Alright, if you’ve got questions, 844-220-0965.  Again, call us right now, financial questions, retirement questions, with On The Money.  844-220-0965.  Or text us at 21232.  Because we are planning tomorrow today.


Welcome back.  You’re listening to On The Money right here on news 96.5 WDBO with certified financial professionals, certified financial planners.  We are taking your calls, because you have questions about finances.  I know you do, because we all do, and we’re all worried about retirement.  844-220-0965.  That’s the number you’ve got to call to get your questions answered.  We’ve got open lines.  844-220-0965.  Or if you’re driving and you don’t want to call in because you’re driving or you’re a little shy, you can always text us your question.  Text that to 21232.  I’m here with Joe Bert and Denise Kovach, and we’ve got a bunch of callers.  But we were talking about wills and trusts and realty, right?


Yeah, we were talking to Jane about what’s the difference between a will and a trust.  One of the other provisions or benefits of a trust, Jane, is in the trust document, you will designate what we call a successor trustee, so that kicks in if you become incapacitated and can’t manage your affairs.  You can also designate your health care directives within the trust.  It’s all encompassing.  A way to get that done and not do a trust is to do what’s called a durable power of attorney and a health care surrogate form, which is generally less expensive.  I think unfortunately trusts are sometimes oversold.  You can do it on a pretty straightforward — like what Denise and I were talking about, titling your accounts appropriately.  Be sure your beneficiaries are done correctly and do a health care surrogate form and durable power of attorney.  But seek legal guidance on that, and I hope that helps you, Jane.




Okay, thank you.


Thanks for your call. Thank you!


Thanks for your call!


And don’t forget one other thing, if you have a sizable estate, if you put a trust in place, then you can do some planning to avoid some estate taxes.


Yeah, if you have a huge estate, $10M, $12M, $15M and you want to do some trust planning as well.


Another benefit.


Yep, yep. Alright, we’ve got a call here from Robert. Robert wants to know about using birth certificates to make bond payments. What’s that about Robert?


I’ve been seeing a lot on YouTube and I know you don’t trust a lot on YouTube and stuff like that but I’ve been seeing more and more stuff pop up talking about using your birth certificate to pay off student loans or purchase cars or whatnot and I didn’t know if it was a fad or if there’s a just a fly by night scheme or if it’s actually true. And after you do it, what would the repercussions be after that?


I’m not sure. I’ve never heard of this. So, let me be sure for our benefit and our listeners’ benefits, what you’re hearing is you give your birth certificate to somebody in exchange for paying off your student loan or buying a car?


Basically what I understand is, your birth certificate is like a savings bond. So when you get that savings bond when you’re born, that’s basically money in the bank and I guess, from what I understand is, you present your birth certificate as a loan deposit and that’s what pays the bill. So you actually don’t have cash out of pocket. It’s actually the paper that has the money.


Robert, that is 100% bogus. Somebody is trying to convince you to give up perhaps your identity. So if you give up your birth certificate, they know where you were born, they know your birth date. The only thing they are missing is your Social Security number which is the next thing they’ll be asking and now you’re in a heap of trouble. I would stay off the Internet, stay away from those harebrained schemes. That makes absolutely zero sense. Absolutely zero sense. It’s bogus. End of story. But thanks for your call.


Thanks Robert.


Jeez oh man, schemes out there.


I’m looking it up on Snopes right now. False.


Oh, yeah, that’s — I mean, you want to talk about giving up your identity, giving up your birth certificate, wow. Somebody walks away, this is my birth certificate. Then they could use it to obviously take over your identity, get on airplanes and stuff.






That’s scary stuff!


Yeah, you don’t want to do that. Forget it. Scares the heck out of me. Okay, Laura we got some other callers, what’s going on?


Who’s next? We’ve got Mary!


Mary’s got a call. She wants to talk about. What do you want to talk about Mary? Good morning. How can we help you?


Good morning. Yes, my dad died in 2008 and my mother in 2012. My mother left the will. In the meantime, during all of that, I was fighting a pretty heavy illness and I had to pick my battles so to speak. I’ve recently got a copy of the will, which has never been probated and everything was to be sold. They have property in North Carolina and here in Florida. The problem is, my sister in the interim, has filed bankruptcy and included those back-taxes on all of those properties in her bankruptcy. How she did that, I don’t know. But it’s kind of frozen. What I can do, I had someone that was wanting to buy these properties and I wanted to get with my sisters but I can’t even sell them now.


First thing Monday morning, you need to seek an estate planning attorney and get this worked through, yeah.




This is not do it yourself time, particularly with properties out of state. And the fact that those assets are out there and now somebody is making a claim on those assets, I would not — first thing Monday morning, pick up the phone. We have an attorney that we work with through our office. You can go to our website. Go to financialgroup.com. Click on estate planning. It’s Jodie Murphy.


Okay, okay.


She’s highly qualified in this area and she will treat you well. But that’s what you need to do and you can tell her you talked to me on Saturday morning and she’ll get you straightened out and down the right path. This is potentially going to be a disaster for you but it can be cleared up. But it’s definitely not do it yourself time.


Okay, alright, great. Well thank you so much.


You’re welcome. Very good luck to you. Mm-hmm, bye. Alright another call here. Laura, what do we got?


Michael has a question on qualifying for distribution for his wife.


Good morning Michael!


Good morning, how are you?


Good, how can we help you?


My wife is going to be turning 59 and a half soon and my question is, is she going to have to stay employed with her current employer to get a distribution. She has a Roth. Or is she going to have to leave her job as considered retirement and go back in a few weeks or a couple of months or get another job. How does this work? Does she have to stay? Is she tied in with her employer? Can she leave her employer to get that distribution? What does she have to do?


What you’re talking about, she has a 401(k) plan or a 403b or 457 or something like that?


Yes, it’s a Roth.


It’s a Roth. Okay. It’s a Roth 401(k)?


Yes, I believe so.


Okay, so it’s a Roth 401(k). And your question is does she need to stay employed to be able to make a distribution from that account?


No, can she stay employed once she turns 59 and a half?


Okay, yeah, of course.


Of course!


Yeah, why — unless she’s fired.


There’s two ways she can do that, Michael, she can take a loan, okay up to — what is it?


One half of your vested balance or 50,000, whichever is less.


Or she can take a distribution, but they’ll take 20% out in taxes automatically.


But if it is a Roth, they won’t.


That’s true. My mistake there.


So if it’s a Roth, they won’t.


If it’s a Roth, they won’t take taxes nor it will be no penalties but will it be considered income for that taxable year?


If it’s a Roth, of course not. No.


Has the Roth been open at least five years?


Yes, it’s been about 11 years.


Okay, okay.


Whoah. Yeah, then it shouldn’t be any tax consequences at all. The key is now, is can she make what’s called a distribution while she’s still employed? Some plans and it depends on the terms of the plan document, whether or not she can make a withdrawal while she’s still employed. I think that’s your question. Is that not your question?


Well, I’m getting confused because I heard about this in-service distribution, the terminology with that, that for her to stay with her employer, for her to take that distribution at 59 and a half, the plan administrator would have to offer an in-service distribution and that’s kind of confusing me a little bit.


Okay, an in-service distribution means that she can get a distribution from her account without a penalty. And she can continue to be employed, so that’s what an in-service distribution means.


But it has to be rolled over into a qualified account.


Okay, well let’s scratch that, because she wants to take a bulk payment of the total balance when she turns 59 and a half, and she wants to also stay employed for another additional two and a half years until she turns 62, at which point she plans on getting her Social Security.


Okay, my guess is that her plan document will allow her to take that withdrawal without taxation because it is a Roth and I think she should be able to do that. She inquired with human resources.


Okay, and she’ll still be able to stay employed with the same employer and then retire at 62?


Oh yeah, oh yeah. Yes, nothing — the retirement plan has nothing to do with her ability to keep her job.


Now, by law, is there any excuse that the financial company can use that she cannot take a full distribution at 59 and a half?


The plan is run by whatever the plan document states and she should be entitled to what’s called a summary plan description. So she should ask her employer for what’s called the SPD, Summary Plan Description, they have outlined all of the features of her particular plan.


Okay, because her employer switched companies a year ago and we never read the fine print. What if it says you have to be with this particular company for 10 years?


No, no, no, no.


I mean that’s what I’m saying by law, she has the right to take that out at 59 and a half correct?


Yeah, what you’re thinking about is when you qualify for a pension or be vested in the employer contributions, that language I’m sure is not in there.


Okay, last question. You guys are financialgroup.com. Is that who you are?


That’s correct.


Okay, and we’ll look you up online and we may come in for a consultation.


Great, we look forward to meeting you. Thank you for the call Michael.


Thanks for your help.


Okay, take care.


Alright, Laura, what do we have next?


Okay, next <?> wants to talk about, you were talking about the realty and retirement and he said he missed it so he wants to talk to you next. Ask him what you want to ask him again.


Yes, hi, good morning. I thank you for answering my call. My call was basically I kind of missed the information you were talking about real estate. I’m retired and I have a real estate property that I have rented out so my question is, is that advisable for me to do or is it something that I should take the money out and put it some place else.


Okay, so let’s back up here. You are retired. You own a piece of real estate for investment and your question is should you cash it out and put the money somewhere else?




Okay, it all depends.


Our famous answer.


It all depends. You wouldn’t want to necessarily sell an investment that’s performing for you, that you are able to keep, that perhaps has upside potential that is providing you cash flow. No, there’s no reason to liquidate it. You probably caught the tail end of a call we were talking about having real estate in your retirement plan, which has complications. So if you are happy with the investment, if it is doing — if it has upside potential, if it’s in a reasonably good neighborhood and you’re able to get good rents from it and it’s not a burden on you, I would keep the property. What do you say Denise?


I agree. I agree. Depending on your other assets, it could be complementary to what else you’re holding. We don’t know. But like Joe said, if it is a good piece of property, hang onto it.


There’s no need to liquidate it when you get into retirement assuming that you’re pleased with the potential of the investment.


I’m pleased with the tenant, I’m pleased with the income. I’m also planning on getting another one. So, the thing is I am in Florida and I have the property in New Jersey so I will likely get one in Florida, because it’s out of state.


Alright, now let’s ask some questions about that. You bring up an interesting situation. The property that you have in New Jersey, is that in a living trust?


Actually I haven’t —


Not got that far yet?


I haven’t.


Is the property in your name alone?


No it’s in my name and my wife.


Okay, so it’s going to pass without probate. It should pass without probate. That’s what you have to be careful of. Right Denise, if you have property out of state in your name alone, then you’ve got probate in two states, Florida and the other state.


Which can be problematic.


Problematic. So that’s another purpose of the trust. Vanessa, sounds like you’re okay. Buy that property, enjoy your retirement. Alright. Take a break here.


Thank you guys. Take care.


Thanks for the call.


Alright. That opens up some lines so if you have questions, you want a call, we have one more segment, 844-220-0965. Wanda, you’re the first caller up so don’t go away on us because we’re going to grab you after the break here. 844-220-0965. Or you could always text us your question, 21232, 21232. This is On The Money with Certified Financial Group because we are planning tomorrow today —






<Background Noise>.


Welcome back. Thank you for listening to On The Money, brought to you by Certified Financial Group right here on News 96.5 WDBO. This is our last segment. We are back every Saturday, 8:00am, 9:00am to 10:00am, answering your financial questions. We have a bunch of calls we have to get through and we have a workshop we want to talk about right?




So let’s get it.


Exactly. I tried to say exactomundo, it didn’t work out.


No it didn’t but yeah, Nancy and I are hosting our Social Security boot camp next Thursday evening in our office.


This Thursday?


That’s this Thursday. Oh my goodness. It’s the 20th of July right? That’s this week.


At 6:00, we’re going to host our Social Security boot camp. We’re going to talk about claiming strategies, whether you’re married or divorced. You might have some opportunities there. We’re going to have some light refreshments. So if you have an interest in learning a little bit more about Social Security claiming strategies, you can go on our website and sign up to come on out. Again, it’s going to be in our office at Altemont Springs from 6:00 until about 7:30 next Thursday, which is July 20th.


So go to our website financialgroup.com. Click on a workshop so you can make a reservations right there online or leave a message at 407-869-9800. Once again 407-869-9800. Hope to see you there. Alright, Laura, what do we got?


Wanda has a will question, she’s held on patiently.


Hi Wanda.


Hey Wanda.


Good morning. How are you?


Good. How can we help you?


Yes sir, I wanting to find out, me and my husband, we’ve been married for 16 years, but he has children by his first marriage. Anyway, he has one of his daughters as beneficiary for his will. And I would like to find out exactly what do I have in —


Any rights? Do you have any rights?




Is that what you’re saying? Do you have any rights?


Yes sir. <Inaudible>.


That’s a legal question one and I’d want you to seek an attorney on that depending on how the will is written and what other assets that you might have in joint names. That’s going to solve the question for you. So it’s not a question that we are really qualified to answer on the radio. But I appreciate your call.


Alrighty, awesome. Thank you Wanda! We’re on to Shannon. He’s got some good questions about credit.


Morning Shannon.


Hey Shannon.


Hey, good morning everybody. I’ve got a quick question for you. One might not be as quick as you want it to be but so I own a business and I own two houses and when the kids came along and I got stuck in this construction loan a little while back, I found myself a little set back. I’ve got about $80,000 in unsecured credit debt. One is a business loan, but I’ve had to guarantee it all, so I’m just basically considering it my own debt. AmEx charged me off even though I was in complete communication with them and intended to pay them back and I still do at this point. But when my credit exploded it was like a stick of dynamite went off in my wallet. I’m asking myself what’s the difference between one stick and five sticks going off all at the same time if it is just a time and numbers game before I regain and get my credit back. So I’m debating a tactical lay-down of my credit. Feels ugly but —


What you’re talking about is filing bankruptcy?


Maybe not even going that far.


So what do you mean by tactical lay-down?


Simply stepping away from these cards.


And then it’s going to wreck your credit and you’re toast.


Right, credit is already wrecked. I’ve already got one charge off so there’s virtually nothing I can do with it when it pulls you down into your front end <?> of the five <?>.


So what you’re saying, it can’t get any worse than what it is.


I’m thinking that. What’s the difference between a four and mid fives, if neither of them will buy you anything?


Well, then, in your view that may be the decision that you have to make and then you have to determine whether or not they’re going to ultimately come after you for whatever assets they can find. That’s a personal decision but I see where you’re coming from. Can’t get any worse than what it is so what the heck.


<Background Noise>.


Thank you very much. Alright.


Alright, that just about does it. Do we want to give out numbers one more time?




I wasn’t paying attention. I was thinking about John, he’s still on hold. My goodness John, hang on. Our number at the office 407-869-9800 or get on financialgroup.com.


This is On The Money. We’ll see you next Saturday.


<Background Noise>.


This is News 96 <Lost Signal>.


Dictation made on 7/26/2017 2:07 PM EDT.

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

Well, happy first day of July, everyone. 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 with Joe Bert and Denise Kovach of the Certified Financial Group. Good morning, guys.

Good morning, Tom.

Good morning.

How are you today?

We’re doing great.


Well, Joe, it’s the first day of July. We’ve hit the halfway mark of the year.

Hard to believe, isn’t it? Hard to believe.

Amazing, huh?

Halfway gone. Before you know it, it’ll be what’s coming up next. We’ve got the 4th of July, then Labor Day.

Which I believe — I mean, everybody’s got Tuesday off, but everybody’s either half day or have Monday off. Maybe it’s a long, four-day weekend.

We decided to give the office a long weekend, and so we’re gone until Wednesday.

That’s — I’ve heard around this office did it, and I think everybody — you know what, let’s just give Monday off. Everybody needs it. Everybody deserves it. Like, okay. So we’ve got a nice, long, four-day weekend, so we could do a little work and a little play and a little relaxation all in the same weekend.

Well, you know what’s so crazy, and you might agree with me, is that, yesterday, it was just Christmas.

Yeah, well, it’ll be here again before you know it.

My goodness. This year is just going so fast.

Well, I mean, even worse, didn’t we have Monday off for Memorial Day last week?

Yeah, even <Inaudible>


Time is going by fast. Well, we <Inaudible> That’s why everybody keeps telling me, and it’s like, I can’t even imagine. It’s going by fast now. So you’re saying it’s going by even faster when —

You wait, my friend.

There’s a lot of truth to it.

Well, we’re here answering your phone calls. Why, Joe?

Well, because, just like we said, your life goes by fast. And you haven’t done any planning if you really haven’t thought about what you’re going to do when those paychecks stop some day. What are we going to live on? How are we going to enjoy what they say are those golden years? But, basically — let me back up. How are we going to cover the basics, like gasoline and food and the rent or the mortgage or medical care and all that stuff. How are we going to pay for that? Because you’ll have Social Security plus whatever you’ve been able to save and accumulate over your working lifetime. And unfortunately, most people don’t realize that until they’re somewhere in their 40s or 50s or 60s. And then you don’t have a lot of time. So what Denise and I and the other certified financial planners of CFG do day in and day out, for a fee, we help solve the financial maze that you might be trying to work your way through. You go through life trying some of this, trying some of that, and hope one day it all comes together, only to wake up and find we have a collection of financial accidents. So we are your financial body shop. Bring it to us this morning, and we will try to repair those dents and bruises that you might have on your financial life. And there’s nothing that we haven’t heard before. In fact, if you call in this morning, you don’t even have to use your real name. You can pretend that you’re Jack or Daphne or whatever you want to do, and you can just pretend you’re somebody else because we don’t know who you are, and frankly, we don’t care who you are. we just want to help you. So, if you have any questions about your personal finances as they might revolve around questions in stocks, bonds, mutual funds, real estate, long-term healthcare, IRAs, 401(k)s, annuities, reverse mortgages, all that and more, Denise and I are here to take your calls. And as I said before, on Monday through Friday, we do it for a fee, but on Saturday morning, we do it for free. And the good news for you, if you have any questions on any of those topics or anything else I may not have mentioned, the lines are absolutely wide open this 4th of July weekend. So pick up the phone and dial these magic numbers.

844-220-0965. 844-220-0965. Just that simple. We also have the text machine up and running, as well, 21232. Just had to double-check the monitor. Yes, it is up and running, 21232. We just ask you to keep to about 160 characters. That’s all we can see on our screen. So 21232 for the text line. Denise Kovach is here with the topic of the day, common IRA mistakes.

Yeah, and these are things that some people won’t even think about. One common mistake occurs, Kyle, when an IRA owner fails to name a beneficiary. Unlike other property, IRAs do not pass by will. They pass according to the IRA’s beneficiary. It’s that easy to <Inaudible>

When you see people sitting around thinking, well, I’ve got all that done. I did my will. And then I think I took one step — I’ve got a trust, so everything is done. But what you say is very important because that IRA beneficiary is key.

Right. So that beneficiary designation form is going to be important to you because, if there’s no named beneficiary, the default beneficiary will generally be the owner’s estate. And then that IRA is subject to probate. Otherwise, it wouldn’t have been. Your beneficiary won’t be able to stretch distributions over their lifetime, so that’s knocked out of the picture. And you want to make sure your beneficiary information is accurate because you want to avoid, probably, making distributions to unintended beneficiaries, like an ex-spouse, perhaps.

That’s it.

That gets messy.

Yeah, it really does. So be careful there. Another mistake is failing to take your required minimum distributions beginning at age 70 and a half. Failing to do so can lead to a very stiff 50% penalty. This includes taking your RMD from any inherited IRAs you may have, as well. Now, while Roth IRAs aren’t subject to RMDs during the owner’s lifetime, if they pass away and leave it to a non-spouse beneficiary, then that person will then be required to take distributions based on their own life expectancy.

Now, you used RMD. What does RMD mean?

Required minimum distribution.

There you go. And where does that come from? How do we know how much to take out?

Well, it’s a calculation based on your age, and there’s a table. It’s called the uniform table.

The uniform table.

And there’s also another table if you’ve got a spouse that’s more than 10 years younger than you.

Oh, okay.

But it’s something that’s calculated every year.

It’s something you can plan for easily, yeah.

It’s something we do for our clients, for our clients that have — we’re managed their IRAs. We do the calculation for them. And then, if you have more than one IRA, then you’ve got some extra stuff you have to do, right?

Absolutely, because you need to make sure you take the distribution based on the pool of IRAs that you have. And it may include a 401(k), which  you’ll have to take separately if you’re not working there.


But there’s another thing that just came about in the last year or two. There are two types of rollovers: indirect rollovers and direct trustee-to-trustee rollovers.

Tell me more.

I am. Listen to this. With an indirect rollover, you actually take the receipt of the funds, and for the distribution not to become taxable and perhaps penalized if you’re not 59 and a half yet, you have 60 days from receipt of the funds to roll them back into your IRA. The thing is here now, you can only do this once in a 12-month period, and this includes all of your IRAs combined. And it’s not calendar. It is rolling 12 months. So you can’t do it more than one time. They took that opportunity away a couple years ago.

Yeah, that used to be a pretty neat thing. You could have a whole bunch of IRAs and just keep rolling that loan forever.


That changed the rules there.

And one more mistake is contributing too much because, if you do, and you don’t take it back out, there will be a 6% penalty on the excess every year.

There you go.

And there you go. Can you think of anything else, Joe?

No, but if we have a change in the tax law, that’s liable to change, so stay tuned.

I can only talk about what I know today.

It took me forever to learn all those rules, and they’re going to probably change them again. So yeah. But IRAs are a very important part of retirement planning because many people roll out their 401(k)s in the IRAs, and then you want to manage them correctly. And having the proper beneficiary designation on your IRA is very, very important. In fact, one of the things that we talk about oftentimes when we do 401(k) enrollments, and you can have this option, as well, in your IRA, is what’s called a per stirpes designation, which means that, if you check per stripes, that means that that portion of your IRA will flow to that — if that person is not there, it will flow to that person’s bloodline, not their spouse, but their children. If you don’t check per stirpes, that means it will be divided among the remaining beneficiaries. So you want to be sure about how that’s set up.

You know, that term — you know, I couldn’t get per capita, which is split between the beneficiaries, and per stirpes back in school.

There you go.

Those two terms aggravated me to death until, one day, I said, okay, stirpes. Stairs. Stirpes. Stairs. Walking down the stairs and down into the lineage, to the kids.

Oh, there you go. That’s pretty good. That’s very good.

Hey, that’s how I kind of studied, you know?

Hey, whatever it takes. Yes. Some people say it’s per stripes, but it isn’t a misprint. It’s per stirpes, S-T-I-R-P-E-S. You want to check your beneficiary designations. If your intention is for that share to go to that person’s children, not their spouse, but their children, their bloodline, you need to have per stirpes designated. Otherwise, it’s going to go per capita to their surviving beneficiaries.

That’s right.

There you go, everything you wanted to know in an IRA here on a Saturday morning, July the 1st, 2017. If you have a question for Denise, 844-220-0965. 844-220-0965 is the number to dial in. I mean, there’s a lot of people that go on about the IRA because they assume it’s like a 401(k). Well, no, there’s a lot of differences. I didn’t even know that about the will. So, even if you have it listed in the will, here’s where I want my IRA money to go, it doesn’t matter.

Doesn’t matter.


Whatever you have on the beneficiary is going to override what you have in the will or what you say in the trust.

Okay. So the beneficiary overrides.

As Denise said, what you don’t want to do is have it pass through your estate because, then, it goes through probate. See, the beauty of an IRA or a 401(k) or an annuity or a life insurance policy is if you name a beneficiary, anything where you have a named beneficiary or jointly owned property avoids probate. It’s those things that you have in your name alone that goes to the probate court. And some people will say, oh, it’s probate. What’s probate? Probate isn’t a tax. Probate is the time and expense that you pay the legal system to settle your estate. And Denise and I have seen cases where this could drag on for years. And the meter is running, my friends.

Yeah, no kidding.


And the meter fee seems to keep getting larger and larger and larger these days. So how many times are you allowed to change the beneficiary? I mean, is it one and done on the IRA, or can you change it as many times as you please?

You know what? If you have a child, and he or she ticks you off, you can change that over today, tomorrow.

If you have another child, a divorce, new wife, all that other stuff, <Inaudible>.

But you’ve got to be cognizant to do it. Just don’t forget about it.

And that form, you can have in your desk drawer. It’s got to be on file with the custodian or with your HR department if it’s a 401(k). So you can’t get a new beneficiary form and tuck it away and put it with — ah, ah, ah. It’s got to be on file with a custodian or with your HR department if you have a 401(k), 403(b), 457, all that stuff.

So the HR department will have it in their paperwork based on — and if you were to leave that job, it goes to the next job, I’m sure. It’s one of those things that you take with you.

No, the form stays here. So take a breath. So let’s say you leave this job.

This is why I say — yeah.

No, let’s say you leave this job, and you’ve named your spouse as the beneficiary, okay?


And you take another job, and you get divorced. So, whatever is on file here, your ex is going to get here, even though you have may have named the new spouse on the new company <Inaudible>

Oh, that’s interesting.

It’s just tied to that plan.

Interesting. So, right before I leave this job, I’ve got to change it all to me. Well, that’s not smart, either.

Because then it’s going to go through probate, and that’s what we want to avoid.

Well, the number to dial us up, 844-220-0965. 844-220-0965. We’ve got some upcoming workshops, right?

Yes, we do. We’ve got — our next one is basically going to be about healthcare options at retirement, hosted by Gary Abley.

But, but, but, I know you’ve been out of the office. That is jam packed, filled up, no more people, no more seats, no more tickets. It’s over. He is filled up.

Oh, that was — I was just teasing them. They can call in or register for the next one, healthcare options in retirement. That’s hosted by Gary Abley. And then Nancy Hect and I will be sponsoring our boot camp about Social Security.

What are you covering there, for our listeners that may not have ever heard about that?

Claiming strategies.


How to maximize your overall Social Security benefits. Do I take it at age 62? Do I take it at full retirement age? Do I wait until age 70? And what happens in between all of that?

There you go.

So come out and visit with us. There will be light refreshments. It’s on July 20th. It’ll be at our offices. And it’s going to be from 6:00 until 7:30. So we’ve got that one coming up, as well. And we’ve got a slew of others that are available to you, and you can see that on our website, financialgroup.com.

All right. We also see that chart, right? Is that one of the resources, the chart for the IRA distribution you were talking about earlier? No?

The chart for the IRA distribution? No.



I’m not certain.

I’m not certain, either.

All right.

We’ll have to look.

We’ll find out.

That’s one of the charts you said. Oh, man. Okay, okay.

Oh, oh! I know what you’re talking about, the required minimum distribution chart.

It is there.

Well, no. It’s not going to be in Denise’s program because she’s going to talk about Social Security.

No, no, no. I didn’t see — I meant on the website.

On the website.

Oh, on our website. Yeah. Actually, you can go on our website and calculate what your required minimum distribution is.

Yeah, we have learning center.

We have a calculator.

So I was right. I was trying to give them the benefit of going to financialgroup.com.

There you go. There you go.

844-220-0965 is the number to dial us up today, 844-220-0965. We have two Mikes on the line. We’ll get to those on the other side. Right now, it’s time to get the three big things you need to know.

Welcome back to On the Money here with the Certified Financial Group on News 96.5, WDBO’s Ask the Experts Weekend. We are taking your phone calls at 844-220-0965 with Joe Bert and Denise Kovach from the Certified Financial Group, certified financial planners at the Certified Financial Group. Text number is up and running, 21232. If you have a text question, we’ll get to those in just a moment. Before we get the latest news, weather, and traffic, which is four minutes away, let’s get back to our busy phone lines here. First, let’s start off the Mike in Lake Wales. Mike in Lake Wales, you’re up first. You’re on with the Certified Financial Group on WDBO.

Good morning, Mike.

Hey, Mike.

Good morning, Mike. Thank you for calling, Mike. Are you there, Mike? Mike went to go get a cup of coffee.

This is Mike. Do you hear me?

We can hear you. We have two Mikes. This is Mike in Lake —

You said Mike in Lake Wales. I’m the Mike in St. Cloud.

St. Cloud. St. Cloud. Sorry about that.

Not quite as far south.


Thank you for the show. I have kind of a weird situation. I heard you were talking about beneficiaries, and I have one of my sons that I do not want to share anything with. So I have a 457, an IRA, and a Roth. So I hope I didn’t miss anything before, but I just wanted to ensure what’s the best way to make sure that I get my wishes on that.

Well, the key here is that you complete a beneficiary designation form for each of those accounts. And on that form, you’re going to designate primary and hopefully secondary beneficiaries, in case the primary predeceases you, okay. So that’s the way you’re going to keep — that’s the way you’re going to do it, just complete the form and submit it to the appropriate company or your HR department and just make sure they have it on file so, when you do pass away, then your wishes will be granted.

Okay. Well, I really appreciate your help. Thanks for the show.

You’re very welcome.

Thanks for the call.

Have a great day, Mike.

All right. That was Mike in St. Cloud. From St. Cloud, we go to Winter Springs and talk to Mike. You’re on with the Certified Financial Group on WBDO.

Good morning, Mike.

Hey, Mike.

Good morning. Hello. How are you?



How can we help you?

I’m calling today because I’m thinking ahead in terms of IRAs and Roth IRAs, and I wanted to know is it common, or are there good reasons, to put physical property into an IRA, or is it even possible, like rental homes that you may own or gold bars or baseball cards or anything that you think might go up in value over the long-term?

What you have to have is a custodian that will accept that asset. Yes, you can put some of those assets in there. The challenge is valuing them. Now, baseball cards, I’m not so sure about.

That’s collectible. I don’t think so.

Yes, yes, yes. So you’re probably not going to be able to do that. Real estate, yes. However, you have to be very, very careful of how you do that. And I think the reason people want to do those kinds of tangible things is because they don’t understand the other option that many people use, and that’s investing in mutual funds and in growth industries and investing in companies around the world. So, probably, my guess is, Mike, that’s why you’re considering that. Am I right or wrong?

Well, I was thinking ahead that, if I had rental property that I owned, and it was in a Roth IRA, I was thinking that, possibly, the revenue generated from the rent would be tax-free, as well.

The revenue that comes — yes. In other words, the rent, if it’s in an IRA, whether it’s a Roth or a traditional IRA, you are correct. The revenue will be not taxable. In a traditional IRA, when you take it out, whatever you take out, however you take it out, the rent, including any — if you just decide to sell the property and then take the distributions, that will be taxable to you. If it’s in a Roth, under current law, the income, of course, is not taxable, just like in a traditional IRA, and any withdrawals, under current law, will not be taxable to you. However, I underline current law, and if you’re building your retirement around Roth IRAs, I would encourage you to go on the Internet and pull up an article that I wrote for Kiplinger some time ago about — it’s entitled Roth: A Wolf in Sheep’s Clothing, Roth: A Wolf in Sheep’s Clothing, and it may dissuade you from using a Roth IRA to build your entire retirement portfolio around. Now, once again, if you put real estate into an IRA, you have to be very, very careful. There’s some drawbacks to doing that. You know, some of the benefits of owning real estate is the depreciation, the interest deduction, the ability to deduct the maintenance and insurance and all that other stuff. Those are all benefits that you lose if you put money into a — put real estate into an IRA.

And you’ve got to be really careful because all expenses and everything have to be paid from the IRA. And, at the end of the day, and this is in the case of a traditional IRA, what are you going to do when you have to take a mandatory distribution and cash isn’t there to take it?


You’re stuck.

You’ve got to be careful. It can be done, but you’re giving up some stuff, the benefits of owning real estate outside of retirement.

All right, Mike. Thanks so much for the phone call. If you would like Mike’s line, it’s 844-220-0965. 844-220-0965. We are planning tomorrow with Joe Bert and Denise Kovach from the Certified Financial Group right here on News 96.5, WDBO.

That’s a Joe Bert favorite. He always starts dancing when this one comes on.

Four Seasons, baby.

That’s it, man.

Hey, at the last bumper break you had, you played the Beach Boys.

No, that was the Beatles.

Hotel California.

Oh, and then you played the Beach Boys one before that.

Yes, yes.

You did play the Beach Boys this morning.

Okay, I did.

All right. In any case, the reason I bring that up is because, if you go to our Facebook page, you will find a 4th of July tribute that the Beach Boys have done.


It’s great little video. If you want to get in the mood for 4th of July, go to our Facebook page at Certified Financial Group and entertain yourself.

There you go.

There you go.

And just like that, facebook.com, and then just put Certified Financial Group in the top bar.

That’ll do it.

Just like that. Well, welcome back to On the Money with Joe Bert and Denise Kovach from the Certified Financial Group. We are taking your phone calls at financial group, we are taking your phone calls at 844-220-0965 and he’s had some great information just in the first half hour about common IRA mistakes, we may get to those in just a <Inaudible> it’s okay if you just joined us a little bit later in the show, but let’s get back to our text questions here, just so we can get the information out.  Let’s see, what do we want to do first here, Joe?  What is the advantage of a REIT Dividend on a 401(k) if the share price goes down by the same amount?

There is no advantage, there is no disadvantage.  What happens is, whether it’s a REIT or a regular stock mutual fund or bond mutual fund, when that fund makes a distribution of interest, dividends or capital gains, the share price will drop by the amount of that distribution.  However, if you’re reinvesting, basically you aren’t going to buy more shares and at the end of the day, you’re in the same place that you were before the distribution.  However, what you’re doing is acquiring more shares and the name of the game is to get shares because when those distributions occur, it’s a function of how many shares you own.  So when you see the share price drop, that’s something I think listeners need to keep in mind, Denise.  You know at the end of the year where they see share prices drop and all they’re looking at — they’re measuring the value of what’s going on in their portfolio by the share price —


Which is going to drop when those distributions occur.  You have to remember, when the distributions occur, if you’re reinvesting, you’re getting more shares, be it at a lower price, but at the end of the day, you’re in the same place you were before the distribution.  But the next time there’s a distribution, you get a larger percentage because you own more shares.

There you go.

There we are.

All right, just like that, if you have a text question, 21232, just keep it to about 160 characters and if you want to give us a phone call, it’s 844-220-0965.  Next text question in, contributing to a Roth IRA and you actually go over the salary threshold, what do you do?  You need to take the money out or you can make it a non-deductible IRA, right?

Well, he’s talking about a Roth IRA.

Right, yes, so he has to take the money out, he could put it into a non-deductible IRA, you don’t get — obviously, you don’t get deduction, you didn’t in a Roth, but when the money comes out, then it would be taxable to you, so you have to take it out of the Roth account.

Yeah, otherwise there’s that <Inaudible>, the 6% excess —

Yes, contribution.

Yeah, excess contribution penalties.  Take it out and the financial institution will work with them to do that.  Yeah and then as I said, you can put it into a non-deductible IRA and you don’t get the tax deduction unless you did that in the Roth but when you do take it out, then it’s going to be taxable.

And if you don’t have any other IRAs and you put that in a non-deductible IRA, you can do what is called a backdoor.

Yeah, but you’ve got to be careful, as you know, because if you’ve got a backdoor IRA and you’ve got a Roth IRA and then you want to take the money out, you’ve got a whole mess on your hands to determine what came out of which.  You don’t want to have a Roth IRA that you converted from a backdoor IRA and a regular IRA.  It really gets to be messy.  We had a client that we had to deal with that and it is a disaster.



So, here we are.

All right, just like that.  And we’ve got another phone call here, this is good, Lewis in Lake Buenavista.


You’re on the Certified Financial Group on <Inaudible>.

Good morning, Lewis.

Hi Lewis.

Good morning, hi, how are you?

Good, how can we help you?

Thank you for taking my call.  Hey, I’m turning 66 in October and I’m getting ready to see what’s the best — is it to continue working or claim at 66?  What’re the advantages?  I know you were going to have a class and I missed that.

Okay, so let’s summarize.  Your question is, is should you take your Social Security at 66 or should you wait longer and perhaps get more money.  So, good news for you is that we have the expert in the house, Denise Kobautz, Denise, take it away.

Well Lewis, it depends on your personal situation.  Are you married?

No, I’m divorced and I’m paying a hefty alimony in which I —

Well that’s another subject hahaha.

Yeah, so, I would like to get that thing and see if I can modify that too at the same time.

Well, the Social Security, if you take it at age 66, that’s your full retirement age and if you’re still working then that’s going to make your Social Security benefit subject to taxation depending on your earnings, so you keep that in mind.  Now, depending on your life expectancy, you know your DNA better than I do, do you have longevity in your DNA?

In other words, are you going to live a long time, Lewis?

Yeah, I hope so.



Well, based on that, do you need the money?  Let me ask you this, do you need the money?


You do need the money.

I think he said yes.

Yes, I do need the money.

Oh ok, well hahaha, just making sure.  Well then that’s a no-brainer if you need the money, then by all means, file for the benefit.  And if you didn’t need the money, then if you’re waiting until age 70, then you have just increased your benefit by 32%, so that’s 8% per year which could be huge, especially if you have longevity in your lifetime.  So, you know, taking Social Security is a matter of what your needs are and you personally.  So it’s just — if you want to crunch the numbers, perhaps waiting to 70 would be better, but as you said, you need the money, then there you go.

How about his ex-spouse?  If he files, does that change anything for her?

Oh, absolutely.  Were you married more than 10 years?


Well, she can then claim a spousal benefit, which is 50% of your full retirement age benefit, so that amount at age 66.

It doesn’t come out of your pocket though, Lewis, it doesn’t come out of your pocket.

No.  And if you re-marry or whatever, it’s not going to come out of her pocket, everything is the same for you, you’re not going to even know anything.

And when can she claim that?  Does he have to file for her to claim?

If they’ve been divorced more than two years, no.

No.  So if you’ve been divorced for more than two years, your ex can file for half of your benefit if it’s greater than whatever her benefit would be.  It doesn’t impact you.  And maybe it’ll take some heat off on the alimony.

There you go.

Why?  Would that be affecting her alimony?

No, I’m saying when you go to the court and you say well, now she’s getting Social Security and she needs x number of dollars to live on, so if she claims Social Security then that may help your situation. I’m not saying it will.

Okay, I see.

But the bottom line is it does not impact your benefit.
It does not come out of your pocket.  That make sense?

Yeah, that makes sense and it makes me feel good.

Hey! How about that?!


4th of July! 4th of July weekend! Making somebody feel good.

There you go, I like it, Lewis.  Good luck to you.

Lewis, thanks so much for the phone call.  If you would like Lewis’ line, 844-220-0965.  Now is as good as any <Inaudible> refresh the dates on the upcoming workshops you guys have.  I know Lewis tried to make the Social Security one, but just missed it, so I know it’s a great resource for everybody here in central Florida.  They’re <Inaudible> for you guys do it right at your office, get off I4, right there at Douglas and 436, right?


434! Excuse me.

It’s in between 436 and 434, but it’s closer, the 434.

The 434.

Absolutely. On Douglas Avenue and our Social Security boot camp, come out and learn claiming strategies, how to maximize your overall Social Security benefits that’s coming up in our office on July 20th at 6:00pm through 7:30ish.  That’ll be hosted by myself and Nancy Hess.  So come visit with us and light refreshments will be served and of course we have a slew of workshops that are available and they’re posted on our website under workshops.  So feel free to go to financialgroup.com and look at those and see if that’s something you have an interest in.  Keep in mind that the healthcare options in retirement coming up on July the 11th is booked.

But you can get on the waiting list.


You can get on the wait list and you’ll be first in line for the next one, that’s a very, very popular one because people have to decide, what do I do about Medicare and Part A, Part B, Part C, Part D, supplement, what do I need to do?  And you’ve got to make some decisions.  So Gary Atley is an expert in that.  He’s a CFP and a CPA.  Just go to our website.  And if you’re on your mobile phone, what you have to do is click on the menu in the upper left hand side and all those things will drop down and click on workshops and you can make your reservation right there.  Absolutely free and leave your checkbook at home, we’re going to give you good information, we conduct those in our big classroom at Certified Financial Group where we have the state of the art audio/visual equipment and you walk away with some good information.

Do you realize my husband just filed for Medicare?

How about that?

I married an old man.

Well, good for you —

He’s a good looking —

He’s a good man too.

He is a <Inaudible>

And a good 20 – 30 years your senior apparently.

Haha I like you, Kyle.

I know, I had to get that in.

But he gets so many compliments, it’s like people find out his age and they’re like, you are not! He looks dog-on good for his age.

He does look good.

Yeah, it’s because you take good care of him.

Thank you.

There was <Inaudible>

Joe, if you’re out there listening to this.

Boy, Denise is getting all type of brownie points this morning.

I need all the points I can get.

844-220-0965 is the number to dial us up.  If you’ve got a question for anybody from Certified Financial Group, 21232 is the text question in, as you head out to buy your fireworks and/or get the yard work done, put the radio on and figure out how to get that retirement finish line safe and sound and nice and comfortable, so you can pay somebody in your golden years to mow the lawn for you.  Again, 844-220-0965.  Denise, do you have anymore common IRA mistakes we didn’t get to?

No, I talked about these.  I’ll just briefly talk about them again.  Name a beneficiary —

Of course, that’s primary.

Exactly.  Use the beneficiary designation form and be sure to submit it to the financial institution or the HR department.  Take your mandatory distributions beginning at 70 and a half.  Otherwise, there’s a 50% penalty on the —

Plus taxes.

Yeah, on the amount you don’t take.  So if you need to take a $12,000 distribution and you don’t, then all of a sudden, you owe the IRS $6,000.

Plus taxes.

Yeah, taxes.  And be concerned about rollovers, indirect rollovers, specifically you’re allowed to do them once per rolling 12 months and then if you contribute too much, get the excess out because there’s a 6% penalty per year on that excess contribution.  So just a little summary there.

All right, just like that.  Well we do have one quick phone call here, so let’s get to them before we get the three big things you need to know.  Joseph in Orlando, Joseph, you’re on with the Certified Financial Group on <Inaudible>.

Good morning, Joseph.

Yes, good morning, thank you for accepting my call.


My question is, with the retirement part and the Social Security, I have a problem.  I went to prison for various circumstances, I came out of prison <Inaudible> disabled.  So I tried to apply for disability and all that.  I got my disability.  I am now 62 years old and when I tried to call, they told me that I didn’t have enough time since I have been in prison, that I didn’t have work, so I haven’t worked in the last <Inaudible> or whatever credits that I’m supposed to have.  <Inaudible> being able to retire or <Inaudible> disability, but they’re only treating me just <Inaudible> disabled and not able to retire with the earnings that I had made previously.  What would be my solution to this problem to where I’m not getting sufficient amount of money and my age <Inaudible> still would get from Social Security at 65, it would not matter because I haven’t put any money, etc., etc.  Can you <Inaudible> that, please?

Well, if I understand you, Joseph, you’re just wondering why you didn’t get a bigger piece of Social Security.


Okay well —

I’m not getting Social Security, I’m just getting the disability.

Well, SSD is Social Security based on a disability.  Basically, SSD does turn into, at your full retirement age, it will just automatically flow into your retirement, Social Security.

But, I think what happens, and I can be wrong here, you’re the expert, but I think what happens is when he hits retirement age, then the SSDI stops and then he slips into <Inaudible> but now he doesn’t have 40 quarters and I think that’s what he’s saying, he’s hosed.


So you’ve been able — so while you’re eligible to work, the government is saying you’re disabled, so we’re going to give you a benefit, but then when you reach retirement age, that disability stops and it converts to your retirement benefit but you haven’t put in 40 quarters to get a retirement benefit.  I think that’s the situation.  I could be wrong.

And that’s — you know, I’m not an expert in disability and how that works, so I don’t want to give an answer that I really don’t know, but Joseph, I would be happy to research that if you want to shoot me an e-mail at denise@financialgroup.com, so I have your e-mail address and I can respond to you with what I do find out because I’m curious to know myself.

Yes, thank you <Inaudible> because I was wondering whether it was going to kick — if it kicks in automatically, whether it kicks in automatically at my age of 62, I can say no, no I want to wait until I’m 65 or the other where I won’t lose the 30% that you spoke about.

Well that is my understanding okay, this little bit I do know is that when you’re on SSD that you can’t stop it and try to let it grow into your retirement Social Security, that I do know.

We lose no matter what, huh?  Thank you.

You know, Denise, you may be right.  What’s rumbling around in my brain here, that he may still be eligible to convert that SSDI into retirement.  We’ll think about that for a second.  Joseph, well hang on while we’ve got to get the three big things you need to know, but if you want to get behind Nick, it’s 844-220-0965.  Nick, you’re up next right after we 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 <Inaudible> 96.5 WDBO <?> Joe Bert, Denise Kobautz have been here answering your phone calls and your questions and a lot of great ones today.  We’ve got about five minutes away from <Inaudible> news, weather and traffic, so I believe Joe, you want to follow up on a question before <Inaudible>.

Joseph, his question — I misspoke, that he’s going to lose his benefit. SSDI benefit, as Denise had just uncovered, it’ll continue.  Your SSDI benefits will continue into retirement.  The problem is you’re not going to get any kind of big boost.


And that’s — I think what he was saying, he needs more income and he’s between a rock and a hard place because he’s disabled, can’t work and he wants to get more into the system.  So you’re between a rock and a hard place and that’s the challenge of filing SSDI.  Unfortunately, many people say, I just don’t feel like working and I get a good attorney and I can file SSDI and I’ll get this income, but then you really hurt yourself down the road when you need more income.  So Joseph, that benefit will continue but unfortunately, there’s probably no way for you to boost the amount that you’re going to get.

All right, let’s head to calls here.

Let’s get back to our phone calls.  First talk to Nick, who’s been hanging on.  Nick, you’re up first with the Certified Financial Group on WDBO.

Good morning Nick!

Hey, good morning! How are you?

Good, what’s up?

Good.  Hey listen, quick question.  Everybody’s pretty much eligible for Social Security at 62, right?


So, let’s say I decide I want to wait until I’m full benefit at 66, right?  And then something happens and I say well wait a minute, I’ve got — I want to collect it when I’m 63.  I could still do that, right?

Absolutely.  You’ll still take a reduced benefit, but it won’t be as reduced as it would be at age 62.  So the further you get along to your full retirement age, your benefit will continue to grow a little bit.

But remember, if you work between 62 and your retirement age, you’re going to give back money for $1 for every — that you earn over $17,000 so that’s the thing you have to consider.

It’s like for every $2 over that amount, you will be giving $1 back.  So you’ve got to consider that as well, Nick.

Ok, thank you.

You’re welcome, have a great day.

All right, let’s get to John in Kissimee, John you’re up next with the Certified Financial Group, you’re on WDBO.

Hello, yes, I am — we have some extra income coming into the family, self-employment income, so it’s going to be a 1099 and it’s going to be recorded on the schedule sheet <?>.  I am trying to save as much of that as I can into a retirement vehicle that will avoid self-employment taxes.  I can’t.  I’m trying to do it before <Inaudible> schedule sheet and goes into my regular taxes.  So I’ve heard of an individual 401(k), I don’t know if that’d work or not.

Well, the individual 401(k) is going to be based on your salary and how much you’re going to — so you’re going to have self-employment tax in that regard.  Now, you can double that up, you can gift some benefit by adding a profit-sharing plan on top of that, but there is no way to really avoid self-employment tax entirely on that kind of contribution.

So, are there any vehicles out there?  Because I know IRAs, all that’s probably going to be after it’s the self-employment tax only.

No, because it’d be a function of your salary, how those — particularly the 401(k) is going to be based.

What <Inaudible> defined benefit plan, Joe?

It’s still going to be a function of salary.  I understand what you’re up against, everybody looks when you have self-employment tax, how to avoid that.  And you have to be careful in that regard because if you’re not paying self — you know, the other thing that you want to keep in mind is that the Social Security tax that you pay as a W-2 employee, that can be used to offset because you owe as a self-employed person.  So talk to your tax preparer about that and you may not be in bad of shape as you think you are.

Okay, <Inaudible> Joe just — you can see the gears move and <Inaudible>

<Inaudible> problem.

<Inaudible> something else to say.

We just got to dig it up, we only have so much space in there <Inaudible> these years, right?

That’s going to do it for this week’s edition of On The Money.  What’s the best number to reach you guys during the week?

Just reach us at 407-869-9800 or better yet, go to our website financialgroup.com.

We have been planning tomorrow today!

Right here on news 96.5 WDBO.

Dictation made on 7/6/2017 1:09 PM EDT.


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

Well good Saturday morning to you everybody, it is 6/17/17. You’ve got the experts on your radio today, Aaron Bert, Nancy Hecht, from the Certified Financial Group. It is On The Money, Saturday every Saturday at 9:00am right here on News 96.5 WDBO. How are you guys this morning?


We are doing great. How are you doing?


Not too bad. What can the audience call you about today?


We are here to talk about anything having to do really with your personal finances, usually focusing around retirement. So we can answer questions about retirement, mutual funds, stocks, bonds, real estate, annuities, long-term care, Social Security, real estate, all that and more. And as Joe likes to say when he sits in this chair Monday through Friday, we do this for a fee, but on Saturday morning we are here doing this for free. So we will answer any questions. And fortunately for you, the lines are wide open and they can give us a call at —


844-220-0965! 844-220-0965! We also have our text machine up and running as well, 21232. Anything, 401k, 403b, minimum required distribution, all that —




Absolutely! I get to — now that I take some notes and know what everybody is calling about, I can pull out the most common questions we get on the show and we always like to kick it off with a conversation and everybody knows that tomorrow is Father’s Day, and Nancy Hick’s got some information for us. I believe it was the —


Financial wisdom <?> we learn from our fathers.


Right, so I’ve polled the Facebook world for what kind of advice they got from their dads, and I got a ton of responses. Thank you everybody! So obviously, I can’t share them all, but just to start like with my own family, myself and my siblings, we were all in our early to mid-20s when my dad passed away, which — the point at which you would really want to get the advice, so sadly it wasn’t available to us. My father-in-law, one of his big pieces of advice was don’t buy other people’s dreams which I thought was good advice. A lot of dads told their kids to pay themselves first, which is a great thing. One of my school friends, her dad said save 10%, tithe 10%, budget the rest and live within your means. A lot of don’t spend more than you can afford and pay off your credit cards. One of my childhood friends said my dad taught me that I am my first bill, and then her dad said did I say that?




That was really funny. One of my girlfriends said that she wants something and she would ask her dad how much is it, and his response was always it’s more than you’ve got in your pig. And it taught her that if she has to decide if something was a want or if something was a need. If it was a want, that she should buy it, and if it was a need — then it really wasn’t necessary. And if you don’t have the cash for it you don’t get it.


Wait, wait, wait. It was want?


If it’s a want, you get it — I mean if it’s a need you get it. If it’s a want you don’t. I’m sorry.




I’m sorry.


I’m like wait, wait what?




You know what, let me <Inaudible> I’m still trying to re acclimate to the real world after being at the beach.


No, no, we just want to make sure we didn’t say something we didn’t really mean.


Yeah, well and that’s something I had told my daughter, when you’re shopping you go to the back of the store first, where everything is on sale, and work your way to the front and is it a want or is it a need. And if it’s a need then that’s where you go.


Those big fancy displays are in the front of the store for a reason.


Right. Always put away a minimum of 5%, preferably 10% from your salary if you can do that. Don’t lend or borrow from family. This girl’s dad was a real stickler about this one, says it always ends up in trouble.






So many things can go sour.




And you don’t want to do that with family.


Yeah, so and another friend said if she wants, even though her parents were financially able to get her whatever she wanted, had also <?> the discussion about a want versus a need and always had — the parents always had veto power over things that were unnecessary.




Yeah, so there’s a lot of really good advice from people here. Never buy anything you can’t pay for now, live off of a written budget, pay as you go.


Yeah, absolutely. Most people don’t physically watch the cash leave their wallet or purses and then watch that wad get smaller, and smaller, and smaller. It’s all virtual. Just swipe a card and it’s easy.


Yes, and that’s a problem I have seen with my daughter in forward <?>. For us, we had checking accounts, we had paychecks. She had to — money was real, and now it is as you just said.


It’s all virtual.


It’s a picture on the screen and doesn’t mean as much.


Actually, we get that a lot with new prospects or clients that come into our office when we do personal financial planning with them. One of the things we go through is — it’s not budgeting, but we have this form. We call it the blue form, and it’s a personal expense form that we give to them and we give it to them so we can find out what their lifestyle is, because when we do personal financial planning, we look at money coming in and we look at money going out and that kind of gives us an idea of the money going out. And I can’t tell you the number of times that people have said to us, wow, that was a great exercise, I had no clue where all the money was going.


And the big difference in our expense summary is when people think of expenses they think of housing, they think of food, they think of their car maintenance and the utilities, and we have things on there like vacations, pet care, education —


For my bond <?>.


Yes, every little thing that you’re spending money on over regular periods of time is a two-column form with a lot of spaces.


Actually, in the past, we have offered that form out. If anyone is interested in getting that form, you can just drop us an e-mail at plan@financialgroup.com. Just put blue form in the subject line with some contact information so we can either mail you a hard copy or we can e-mail that to you if you’re interested in getting that form so you can go through and maybe get an idea and wrap your head around maybe where your money is going.


If you have a question for the panel, the number to dial us up is 844-220-0965. Text machine is up and running as well, 21232. If you have something your father taught you of financial wisdom, I’d like to hear some more of those today. 21232. I saw a stack <?> the other day now that we’re talking about this: College sophomores up until that point have never lived without a check card. Check cards were — came in — became <Inaudible>


Right, right.


So they were born in a world where check cards always existed. Yeah, I tried to get my daughter to keep some cash in her wallet for emergencies, some stash money. Especially this time of year, a conversation I have with my clients is how much cash do you have in your house, because if you lose power and a store has a generator and you can get there —


<Inaudible> Internet or connect to a credit card servers or anything like that.


If you have cash you can get stuff.


I was having that talk with my wife. The last hurricane, the first hurricane she had ever experienced, said we need to go to the bank and get cash. Said why. Said because if they don’t have power and they’re <Inaudible> generators, you can only buy with cash. And she goes yeah, that makes total sense and something I would have never thought of. Just another one of those things that you take for granted <Inaudible>


Water and cash.




Is there anything like a personal budget plan software that you guys like to use or an app or anything like that that you recommend, that you like?




I personally used Quicken software that’s the desktop software on your computer and every day I download all my transactions. I download all my credit cards, I download all my checking, all my investments, my retirement plans, everything, categorize all my expenses. So every day I do that and I see what expenses are — what my expenses are. I do that for a couple of reasons. I do it, number one, to look for fraud, so if anything fishy comes across, I’m often texting my wife: hey honey, did you buy such and such at such and such, and then she’s like are you on Quicken again.


Oh yeah.


But she hates that I’m looking at that stuff. At the same time — because we have caught a couple of times fraudulent transactions <Inaudible> just because I’m on top of it every day. So I personally use Quicken and then it develops a budget for you. You can see where your money is going.


You’re worse than me. I do it about twice a month, the end of the month and the middle of the month. Bills that are due on the 15th and the bills that are due on the 1st.


Once you become a victim of identity theft —


That’s all it takes, just once.


Yeah, well, twice for me. Yeah, you’re on top of it every single day.




I mean it’s just part of my daily routine. When I sit down at my computer at work I start up Quicken, I just run the download and then I start downloading all the other stuff that I do to —


<Inaudible> I use it as well and it’s pretty savvy, especially now you can direct connect to the bank and just refresh and just see in real time how much you spend.




I think a lot of people when they look at that pie <?> at the end and go man, I spent $1,400 on food in the past two months, we can cut that down to 900. There’s something there and that is a key. Now if I go and find the extra $500 and I said okay there’s my savings. What should I do with that? Put it aside? Put it away for retirement? I know CDs and savings accounts don’t return any more.


They don’t. However, you have to have an emergency fund, something that we talked about all the time. And it’s a discussion I have with every new client that I’m sitting with is what is your comfort zone for cash on hand. So once you figure out what that is, it doesn’t matter that checking, savings, money market is earning nothing. It’s cash. But if you are consistently having $500 extra, then yes, my first inclination would be to increase what you’re saving pre-tax, increase your payroll deducted retirement account. It’s — you can afford to put a little bit of the net in there but because you’re saving money in taxes as opposed to making after-tax contribution it’s not going to make that much of a difference in your spendable.


You can see that savings grow just by taking a pre-tax.




A lot of people can go on their company’s website and do it.


Yes, and you have time on your side because you’re a young guy and that will make a huge difference, even just an extra $50 a month will make a difference.


Well Nancy Hick and Aaron Burt are here in the studio, taking your questions you may have at 844-220-0965.


<Inaudible> my wife just texted me and said yeah, it’s annoying when I download my transactions every day and text asking her if she’s spending money on stuff.


Well, but I do that to my husband.


At least she listens.


It’s the nature of the beast. I do that to my wife all the time, like when I’ll sit in the computer and saying what did you spend this on, what did you spend this on, and she always has — then she comes in and said what are you looking at. So I think she’s interested in it, but I don’t really know if I’m annoying her with that or not.


Yeah, I don’t ask my husband what did you spend blank on. I say did you spend that much money.


That’s what I do. I don’t ask what she bought. I just make sure it’s a legitimate transaction.


I like to know what we’re spending it on, so if I just see a blanket $60 charge to Walmart, well that could be food, that could have been clothes, that could have been this, so that’s why I always ask. I’m that — I want to know between food, and clothes, and gifts, I want it down to the detail and what the purpose is. Like, no, we’re spending too much on gifts, we’re not doing that.




844-220-0965 is the number to join us on the radio today, Nancy Hick, Aaron Burt, certified financial planners, Certified Financial Group. The text machine is up and running as well, 21232. We do have some text questions in. We’ll get to those on the other side. Right now, it’s time to get to three big things you need to know.


Welcome back to On The Money here on News 96.5 WDBO. This is On The Money with the Certified Financial Group. Nancy Hick, Aaron Burt, here in the studio, taking your phone calls at 844-220-0965. We also have the text machine up and running as well, 21232. We are five minutes away from <Inaudible> news, weather, and traffic with Dave Wahl on the News 96.5 newsroom. Back to our questions here on the text line. Alright, Aaron and Nancy, this is a texter writing in. I’m female, single, 61 years old, head of household. Understand you can withdraw money from your employer’s retirement plan to invest elsewhere. Any suggestions?


Okay, well my first comment is going to be why. Why you’re going to take pre-tax, tax-deferred dollars out to invest elsewhere. So —


Is there anything that an employer that would not be pre-taxed.


Yes, some employer plans have Roth contributions. Those after-tax dollars, but that’s money that’s growing tax-deferred and/or tax-free depending on how long it’s been in there, but it’s really a function of how the plan is written and not necessarily the dynamics of the person making the withdrawal. So first you need to find out from your HR department if they allow in-service withdrawals and what is the minimum age for in-service withdrawals before you get into the demographics of being head of household and all that other stuff.


We’re assuming she’s still working and trying to take money out of the plan while she’s still employed. Obviously, if she stopped working then she has other options.


Well, yes. If you’re no longer employed, then you have the rollover option and then you can pull money out at will depending on what your age is. You’re going to pay taxes and penalties, but —


She’s 61, so she’s past the penalty age.


Alright, so and most plans that offer in-service withdrawals it’s at 55 or older and it’s a percentage of what you have in there that you can take out. But I just — it doesn’t make sense to me. If it is as stated to invest elsewhere —


Right so but one thing to consider too is if you are no longer working and you are considering a rollover, there are some advantages to rolling out of a 401k into an IRA, one being that you can take distributions at will versus in the 401k normally there’s a fee every time you take a distribution and you can’t maybe do monthly income. So if you’re trying to supplement your Social Security — well not Social Security yet, but you want to get a regular check, you normally can’t do that from a 401k.


Well and withdrawals have an automatic 20% withholding and this person may not be in the 20% tax bracket.


Right, so the other consideration too is that in an IRA you may have better investment options, it may be less expensive for you depending on how expensive your current retirement plan at work it, and there’s a lot of factors that go into trying to decide whether or not it’s a good idea to move from your 401k into an IRA or some other type of investment vehicle.


If that’s the type of withdrawal that this person is asking about, <Inaudible> invest elsewhere is to roll the funds over to an IRA so it’s still staying tax qualified. I may not have a problem with that. I’ve had clients that have done that, to be able to divest some of the limited choices they have in their 401k and they have done an in-service withdrawal as a rollover.


Got you.


But it doesn’t make sense to just take it out <Inaudible> taxes and invest it into a regular brokerage account. There’s no reason to do that.


And there’s no major penalty for doing a rollover, right?


No. There’s — no. As long as it goes from corporate plan to individual plan and it’s all tax qualified, yeah, non-taxable event.


Alright, just like that, thank you so much, texter, for writing in. If you have a text question: 21232. If you like to talk on the phone line the old fashioned way, if you have <?> a follow-up question or the team has a follow-up question for you, it’s real simple to do that too: 844-220-0965. Lou in Auburndale has a question for our panel. We’ll get to that as soon as we get the latest news, weather, and traffic. On the other side, we are planning tomorrow —




With Nancy Hick and Aaron Burt from the Certified Financial Group here on WDBO.


Welcome back to On The Money here on News 96.5 WDBO with the Certified Financial Group, Aaron Burt, Nancy Hick, live here in the studio taking your phone calls at 844-220-0965. Text machine is up and running as well, 21232. Aaron for those of the new audience that may have joined us during the latest news, weather, and traffic, what can they call you about today?


We are here, Nancy and I, to answer anything having to do with your personal finances. We can talk to you about stocks and bonds and mutual funds and real estate and long-term healthcare, Social Security, 401ks, 403bs, IRAs, anything, all that and more. Nancy and I are here to take your calls, and fortunately for you the lines are pretty wide open. We have Louie here that we’re going to talk to in a minute, but we want to get more callers up here lined up so that the next half hour will be pretty entertaining.


Absolutely. You can do that by dialing 844-220-0965. And just like that, call us up, we’ll get you screened, we’ll put you in line and just like Lou did, Lou here in Auburndale, you’re on the Certified Financial Group on WDBO.


Good morning everybody!


Good morning, how are you?


Uh, living <?>.


Alright, what can we do for you, Lou?


Hey! Us too!


Yeah! There you go! On 64 <?>. I own my own business. My husband and I have put our house up for sale and when all the dust settles, we should have about $300,000 ahead and we want to take our RMD and travel the United States. I pay <Inaudible> work while we’re on the road <?>, but I’m wondering what to do with all that extra money to maximize our retirement.


Okay, so you’re self-employed?


Yes, I am.


Okay, and is your husband still working or no?


No, he’s retired.


Okay, so I don’t know if you’re taking advantage of something like a SEP-IRA or something along those lines, which —


No, nothing right now.


Okay, well, so if you have a SEP-IRA you can set aside 25% of your adjusted gross income for this year is up to $54,000.




So depending on how you fit in those parameters, you may be able to use some of the proceeds from the sale of your home, to fund a retirement account for yourself. If nothing else, you can certainly do a traditional IRA or a solo 401k which would allow you to set aside more for yourself than even the traditional IRA would.


What was the IRA you were talking about?


A SEP-IRA or you could do a solo 401k or you can do a traditional IRA.




Okay so that would be one use of the proceeds that could help you for your retirement. Being 64, generally I do planning for life expectancy to at least 90, so you have quite a number of years ahead of you and anything that might be excess you’re going to want to look at some type of balanced portfolio of mutual funds, I would say leaning a little bit heavier towards equities for long-term growth. Planning for this type of windfall no matter how big or small it is, chunks of money are different to everybody is one of the types of things we do.


Lou, one thing that I’m thinking about is you say you’re going to get in your RV and start driving around the country. What’s you’re plan when you stop driving around the country?


Probably I guess long-term it would be maybe a condo.


So you’re going to come back and buy another property?


Maybe, yeah.


Okay, so those are the types of things, really, that go into doing some detailed financial planning. Because obviously if you have some money that you need to set aside for to purchase a property in maybe a year, two years, three years, four years, whatever it might be, that you don’t take a tremendous amount of risk with those dollars so that you have those funds available to you when you come back or wherever you end up planting your roots <?>, and —


When you say set aside, how would I set aside — what would I set it — in what? Like my father had American Mutual Funds, and they did very well for him.


Right, and that is a very nice fund family, but — and let’s say that you’re in two years going to want to buy a home, a condo or whatever, so that — whatever you might want to set aside to spend on it, $80,000, $100,000, that would be something that’s relatively liquid, so I would look for a two or three-year CD, something that if you’re looking at 24 months or less, you don’t want to actually invest it in a fund such as your father had, so whatever money you want to set aside for the future home, it’s got to be checking, savings, and money market or CD. I had some clients that did what you’re about to embark on doing for — they took five years. They liquidated everything, sold the home, bought the RV, and for five years they traipsed all around the country, went wherever they wanted to, had a wonderful time. But one thing they had done and you may want to consider is they had predetermined where their end point was going to be, and had purchased a small home. The situation that we’re in now is an environment of rising interest rates, and if you’re not going to pay cash for whatever that future home may be, you might want to start thinking about that now and maybe purchase a place before you go and then hit the road knowing comfortably that you have a place to go back to and you’re not going to pay five years worth of inflation and higher interest rates to buy that place.


If I went ahead and did that and bought a condo let’s say and my end game was five years of travel like these other people did, what do I do with the condo for the first five years.


I would rent it out if it was me, but you can leave it empty and use it as a home base for when you get tired of driving around or you can rent it out and make some supplemental income.


There’s nothing wrong with leaving it unoccupied, but as Aaron said, renting it out you’d have to hire a management company because you’re going to be long distance.




Lou, is this money coming out of your home same the only savings that you have for retirement or you have other stuff above and beyond this.


I have a little bit of savings from my business, not much, but we plan on selling the house, having the RV, and staying local and I was thinking of maybe working another two years here which would net us about another 150,000 maybe. I would love to invite you, Lou, to come in for a complimentary consultation and let’s look at maybe potentially doing some financial planning so you can hit the road with the peace of mind that you have absolutely nothing to worry about and you’ve planned this all out.




Okay, you could either go to our website which is financialgroup.com, and click on — if you want to click on my picture and it will take you to our page and you can request a complimentary consultation or you can call our offices Monday through Friday, 8:30am to 5:30pm 407-869-9800.


Alright, just like that anybody else that wants to call you up during the week, that’s the best way to do it. Alright Lou, thank you so much for your phone call. If you want Lou’s line, it’s 844-220-0965. We also have the text machine up and running as well, 21232. Let’s go to Liz. Liz has a Social Security disability question. Liz, you’re on WDBO.


Hi, good morning!


Good morning!


Good morning, Liz!


I have a question. My husband got hurt on his job and he was on workman’s comp and that has expired, and he is now trying to see — we don’t know if it’s possible if he can apply for disability whether it would be partial disability, short-term, or long-term. He’s also on Social Security now, so he’s 73, so we don’t know where to go from there.


Well, you can’t go — Social Security disability will pay you before you start drawing Social Security. Basically, they start paying you your Social Security benefit early, so if he’s already receiving a Social Security benefit, Social Security disability won’t be an option for him, as far as I know.


Yes, and that is correct. But you also had mentioned short-term disability or long-term disability. Is that something that he has through his employer as a benefit that you’ve taken advantage of?


No, no. I don’t know if they have that, but he had gone in to see the workman’s comp person who is assigned to him, I think. And he — they had told him that workman’s comp is running out right now, so he will have to apply for disability. However, he’s already on Social Security.


But, Liz, if you talk to or you have your husband talk to the human resources department of his company, they may have short-term and long-term disability as an employee benefit, and that may be what the workers comp person is talking about in terms of the Social Security.


Alright, and that won’t affect his Social Security?


No, no.


Okay, but that would be through the company.


Correct, it’s an employee benefit that some companies offer.






Alright, thank you!


Thank you!


Bye Liz <Inaudible> Thanks so much for your call! If you want Liz’s line, it’s 844-220-0965. Aaron Burt and Nancy Hick from the Certified Financial Group are here in the studio for another 14 minutes, taking your phone calls and your text questions at 21232 for the text question. I believe we have some workshops coming up. I wanted to mention those. Nancy Hick’s got the calendar right over there. Great workshops you guys have at Certified Financial Group.


The next workshop is Tuesday, July 11, from 6:00 to 8:00 in the evening, hosted by Gary Avelie, and this is healthcare options in retirement on Thursday, July 20, from 6:00 to 7:30. Denise Kovach and myself will be hosting our Social Security boot camp claims strategies. Then we take a little bit of a break and in September, Saturday the 16th of September from 11:00am to 1:00pm, financial basics, lifestyle strategies for success, also hosted by Gary Avelie, and Saturday, October 21, from 9:00 to 11:00 everything you want to know about mutual funds. Again, hosted by Gary Avelie, and if you go to our website, financialgroup.com, you can clock on the workshop tab and you can make a reservation for any of the workshops you wish to attend.


It’s free, right?


Yes, they’re all free, leave your checkbook at home. Generally there’s some refreshments, light dinner, light lunch, some type of snacks provided, and yes, bring an open mind and a closed checkbook.


Got to have some brain food to take in all the information you’re going to get.


And the reason we do that is a couple of reasons, the first reason being to provide general information to the public so they can make informed decisions about their retirement and healthcare and Social Security and all these other things that are going on in their lives. The other is to give them a familiarity with us in our office so they can come into our office, see our facilities and use our classroom and just become familiar and more comfortable, because it’s hard making an opportunity, walking in some place just cold if you’ve never been there and you’re not familiar with it.


Absolutely. Well, we still have some time to take your phone calls, 844-220-0965. Juliane’s on hold. We’ll get to her right after we get the three big things you need to know. Welcome back. It’s the final segment of On The Money with the Certified Financial Group, Aaron Burt, Nancy Hick, last chance to get your question answered 844-220-0965. Let’s get back to our busy phone lines. Talk to Juliane, first <?> Juliane in Orlando, you’re on WDBO.


Hi Juliane!


Hi! How are you?


Good, how about yourself? What can we do for you?


I’m good, thank you. I just sold a property that I had rented for about a year and a half. And I want to know what I can do with the profit I’ve made to hopefully avoid a large tax payment. I would like to buy another property, a condo, but I don’t know if that’s part of what I can do or not.


You can do whatever you want with the proceeds. Because it was not your primary residence, whatever profit you made is — net of your total cost basis, all your expenses and stuff, is going to be taxable at capital gains rates which right now is 20%. If we do get tax reform, who knows. It could go down a little bit, but —


You’ve already sold this property?






It just closed yesterday.


Because there are things called 1031 exchanges which are a little bit more complex that allow you to roll the proceeds from that into another property without paying the taxes and basically you carry forward the basis into the new property.


You may want to think about that after you buy the next property and you want to sell it.




I got you. Okay. I haven’t received the funds. Does that matter?


No, it doesn’t matter, because the sale’s already done.


Yeah, okay.


It has to be from point A to point B directly with the 1031 exchange. So —


Okay, and I did receive a 1099 from them. Okay well mazeltov on the profit.




Have fun finding your new property.


Alright Juliane, thanks so much for the call. If you would like her line, it’s 844-220-0965. Ellen in Del Tona. Ellen, you’re on WDBO.


Hi Ellen!


Hi can you hear me?


Yeah, we can now. How are you doing?


Okay. Um my questions was in regards to my parents. They’re in their 80s and they have set up a will with — of which I am the executor. <Inaudible> that even though they have a will it would still have to go through probate.




That is correct. A will says probate me.


A will is the probate court’s instructions on how to take care of your parents’ estate.


Ellen, one way that you can avoid everything being public and having to go through probate, if they have money say in checking, savings, money market, all they have to do is add an in trust for or payable on death designation to that. Anything that has a beneficiary designation does not go through probate. It passes by title. So what you’ll be left with is personal items, furniture, clothing, jewelry, potentially the home. But —


<Inaudible> mostly have <?> a lot of belongings. They don’t have a lot of fluid cash, but they own their home outright, a very nice home, and they filled it with lovely furniture and antiques, jewelry, the like <?> and it’s being willed to myself and my two brothers. I can foresee this being a very tedious process if we have to vacate that home through six months of probate. I don’t anticipate any dispute on the will. That won’t be an issue, but we will still have to maintain the home while it goes through that process.


You’re in Velucia County, is that correct?




Okay, so what I would do is go to the clerk of the court’s office and see what might be done to add a beneficiary designation onto the deed of the house so that will pass outside of the will also and thus avoid probate.


Alright Ellen, thanks so much for the phone call. We are out of town for this week’s edition of On The Money. We will be back here next Saturday, 9:00 for the Certified Financial Group for Aaron Burt and Nancy Hick. We’ve been planning tomorrow —




Stay tuned for latest news, weather, and traffic, right here on News 96.5 WDBO.


Dictation made on 6/21/2017 3:18 PM EDT.

Hosts: Special Guest, Jodi Murphy and Joe Bert, CFP®, AIF®

Good morning everybody and welcome to On the Money with the Certified Financial Group here on News 96.5 WDBO.  We are here with Joe Burt and Jodie Murphy, taking your phone calls at 844-220-0965.  Good morning, Joe.
Good morning, Tom.

How are you today?

I’m doing great, how are you?

Trying to enjoy the heat before the rain comes, apparently, this afternoon.

It was a beautiful morning.

Yes, it was very nice.  So hopefully everybody is out on their back deck with their radio on, and we’re going to get them to that retirement finish line safe and sound.  How are we doing that, Joe?

Well, we have a special treat here this morning.  Jodie Murphy, estate planning attorney, is here with me and we’re going to answer your questions — or she will answer your questions about estate planning.  All those things we talked about weekly on the program — folks call in about wills and, what is a trust, what’s a living trust, what’s an irrevocable trust, what’s a healthcare surrogate, what’s this durable power of attorney I’ve been hearing so much about? All those things Jodie deals with day in and day out.  She’s also a specialist in the area of elder care —

That I am.

— and a specialist in VA benefits.  And I’ve learned a lot about VA benefits, how a lot of those VA benefits are being left on the table simply because people aren’t aware of them.  Particularly when — usually the old man, right — is up in years and needs help and care, and doesn’t know those benefits are there and the benefits that the caregiver can have to help care for the old man so to speak.

That’s correct, so lots of things that we can talk about —

That does sound awful, the old man.  But that’s the reality.

It could also be an old woman —

I’m the old man. <Inaudible>

It could be any veteran who served our United States forces and now needs care themselves, or even a surviving spouse of a veteran.  There’s lots of benefits available.  So, we’re here to talk about all that and then the usual stuff that we talked about on a Saturday morning about things to help you plan for your retirement.  Because, as you get closer to those years in which the checkbook stops, you have to start making some decisions.  And unfortunately, as we say they don’t teach you this stuff in school.  So, we go through life trying some of this, trying some of that, going to seminars, reading money magazines, talking to our stock broker or our coworker, and wake up at the age of 55 with a <Inaudible> of financial accidents.  So, we’re here to be the body shop to your financial accidents, fix those up this morning <Inaudible>

I’ve been working on it.

I was going to say, <Inaudible> coming in with some — I mean, you knew Jodie was going to be in, so you had to bring in the good ones.

Well, I was in New York early this week, so I’ve got my A game going here.

Yeah, yeah, yeah.

Anyway, so we’re going to answer your questions that you might have about stocks, bonds, mutual funds, real estate, long-term healthcare, IRAs, annuities, life insurance, reverse mortgages, all that and more.  So, if you have any questions about estate planning, about those wills, trusts, irrevocable trusts, what’s the difference between the irrevocable trust and a living trust, why do I need a healthcare surrogate, why do I need the durable — why do I even need a will? Right?

All great questions <Inaudible>

I’ve got all my stuff in joint accounts, I don’t need a will anymore, right?

Yup, yup, oh sure.

We’re here to take your calls and the good news for you is the line is absolutely wide open.  So, you can be first in line by simply picking up the phone and dialing these magic numbers.

844-220-0965.  844-220-0965.  Wait, there’s more.  We have the text machine up and running as well.  If you’d just like to be one of those young Millennials and text questions in, we’ve got the ability to do that for you.  21232.  <Inaudible> that we get you <Inaudible> keep it to 160 characters because that’s all we can see on our screen.  Again, the text number, 21232.  Well, since we have Jodie in today, let’s just ask her a bunch of questions, right Joe?

Let’s do it.  Come on.

I’m ready.

Alright, Jodie.  I’ll start off this one.  This one always usually gets a phone call with me.  What’s the most common question you’re getting in the past few weeks.

Oh goodness, well there’s tons of questions that I get, but the most common one that I get is how do I protect my loved ones in case something happens to me.  I think especially recently with all the tragedy that we’ve seen around the world, we’re coming up with the anniversary of the Pulse shooting, people are now starting to think about how do I protect myself? How do I protect my loved ones.  And it’s never too early to start.  Start young.  I always recommend that even if you have a young adult child who has turned 18, it’s an appropriate time to start with estate planning.  Make sure you have those disability documents in place.  Make sure you have a way to transfer assets at death. a need there’s a number of different ways to do that.  As Joe mentioned some of them earlier, you can have a will, you can have a trust, you can use beneficiary designations, so sitting down with an elder law or estate planning attorney is a great way to find out what all of those options are.

So, you just brought up the anniversary of the Pulse, which is this week.  And all those young adults, probably many of them had never even thought about estate planning.  Why is it important for somebody age 18, 19, 20, 21, 22 years old — that’s <Inaudible> a kid.  You’re just starting your life, even consider thinking about estate planning.

Well Joe, I think you are aware that we represented several of the families of the victims and one of the most difficult things for us to help them navigate was the legal system.  All of these young adults were facing medical crises for the people who survived and then of course probate for those who did not, and if you do not have a healthcare surrogate in place there is absolutely no one who is authorized to make a medical decision for you once you turn 18.

Okay, so let’s just draw a picture here.


I’m 20 years old.  I was shot.  I’m now in the hospital.  What happens?

It depends.  If you’re able to communicate and talk to the doctors, you can consent to your own medical treatment —

I’m in a coma.

If you’re in a coma —

I’m just laying there on the gurney.

Then the law does not say who can make a medical decision for you.  So, in reality the doctors will try their best to work with family members.  But what if those family members are not here locally? What if you have a mom and dad who are divorced and who disagree on what medical treatment should be received.  What if you’re married and your spouse does not agree with what your parents want? If you do not have in writing who you want making a medical decision, it becomes a mess for lack of better words.  And then the doctors don’t know whose direction to follow and will require that a court ordered guardian be assigned and to get a guardian assigned is a very long, lengthy, expensive process.

In the meantime, I’m on the gurney bleeding.

Hopefully not.  Hopefully the doctors have done their —


— lifesaving —


— emergency procedures.  But that —

But there’s decisions that have to be made.


Regarding your medical care that, unless somebody’s been appointed and you can’t make them —


Then the doctors really have no choice.


They have to back away and hopefully —

Until the court gets involved.

— the legal system gets involved.  So this is critical.

And as you followed with Terry Schiavo, that was a case here in Florida.  It took 10 years going back and forth until ultimately it was the Florida supreme court in 2004 that made that decision.  It wasn’t a family member or a loved one.  So, it’s really, really important that everybody who has turned 18 takes the time to put in writing who they want to make a medical decision for them.  And not just who can make a decision, who are they authorizing to talk to the doctors, review confidential medical records.  If you don’t authorize them on a HIPAA release, by law, the doctors cannot share medical information with a parent, a sibling, a spouse.

And some folks, unfortunately, think that this is very, very expensive to have done.  And that form is very basic.

It is.

There’s not a lot of time and expense, but it’s something that’s very important and should be done by an attorney.  Why is it important that it should be done by attorney? Why can’t I go online and just fill out the form?

Well, because the law in Florida is always changing.  So, with the healthcare laws, specifically healthcare surrogate laws, we had a change in our Florida statutes last year with the durable power of attorney financial forms.  The last change was in 2011, and online forms are not always current, up to date, or include all of the provisions that need to be included.  Every state law is different.  So, if you get a form that might be valid in California, it may not contain all of the provisions that Florida law requires.

And I would presume that if I came to you and I had this work done and then the law changes, I am in your system and you would automatically let me know that work we did for you a couple years ago, the law has changed and we need to update it so I’m always current.

Absolutely.  That’s crucial —

<Inaudible> yeah.

— I would recommend every three to five years that you review any documents you’ve already executed.

There you go.  Alright, we’ve got a call here.

Yeah, we do but <Inaudible> give out the phone number for anybody who wants to ask Jodie a question or Joe a question, 844-220-0965.  844-220-0965.  And let’s get started with our first caller today and talk to Robert.  He’s got a trust question.  Robert, you’re on with the Certified Financial Group on WDBO.  Good morning.

Good morning, Robert.

Good morning, how you doing this morning?

Good.  Thanks for calling.  How can we help you?

Hi, Robert.

I want to understand the ins and outs of a trust.  If you have money and you want to put it away for your family and you put it in a trust, how does that exactly work? Can they take it out of the trust if they choose to do so <Inaudible>, is it locked in, what’s the benefits and the pros and cons of having a trust for your family?

Well Robert, that is a great question and the answer is all going to depend on what kind of trust you have.  So, there’s two main types of trust.  The first one is a revocable trust.  The second one is an irrevocable trust.  They are very different.  A revocable trust, I always explain, is like a basket.  During your lifetime you put assets into your basket.  The basket has a set of written instructions that says who manages the basket, who can use the things in the basket, what happens if somebody becomes incapacitated, and ultimately at the death of the grantor, what happens to that stuff in the basket.  So, with a revocable trust, it is treated as if it was still your asset.  You can take money in, you can take money out, you can use it, you can change it, you can do whatever you want as long as you are capable.  An irrevocable trust is the exact opposite.  Once you set it up and fund it, it cannot be changed.  Irrevocable trusts are used to protect assets.  There is an element of creditor protection in case you’re in a lawsuit, or if you need to shelter assets to apply for government benefits like Medicaid or Veteran’s benefits.  But again, once you put the money in, it’s almost like you’ve made a gift.  You cannot get it back out yourself.  There might be somebody else who has access, but it’s a basket with iron bars wrapped all around it.  So again, it really depends on what type of trust you’re using as, again, once you have a trust and once you’ve put money into it, the number one benefit of that is anything in your basket, whether it’s wrapped with iron bars or not, will avoid probate.  So, it’s a great way to gather your assets and make sure that you’re not getting a court or judge involved at your death.  Because those things avoid probate.

Another name for the revocable trust — excuse me Robert — is the living trust.

That’s correct.

Now, most people know about revocable versus irrevocable.  So, revocable is living.


And while you’re living, you can make the changes because it is revocable.  Once you’re gone, then that revocable often turns into an irrevocable trust.

It can.

If you have a living trust, if you’re being sued, can they take any assets from that trust?

Yes they can.  So, the rule of thumb is if you can get to your assets, so can creditors.  So, if it is just simply a living trust, revocable trust, you’re the trustee, you have the ability to go in and access your money, then so can creditors.  It also counts as your asset for those government benefits like Medicaid or VA.  An irrevocable trust cannot be accessed by creditors.  So, if you are sued and you have an irrevocable trust, it cannot get to that, but neither can you.

I understand, I understand.  Thank you, you answered all my questions.

Okay, well thank you for calling Robert.

Robert, thanks for the call.

Alright Robert, thanks so much.  If you want Robert’s line, it’s 844-220-0965, 844-220-0965.  You’re going to want to get in line because we have a lot of time still left on the show today, but we have to pause and get the three big things you need to know.  But first, Jodie, what’s the number to reach you at during the week?

If you’d like to call and set up a consultation — and those consultations are always complimentary — you can call my office at 407-865-9553.

And as always, Joe, what’s the number to reach the Certified Financial Group?

407-869-9800.  Or better yet, go online at financialgroup.com.  In fact, you can click on estate planning, see the lovely smiling Jodie Murphy and her partner, Michelle Murtlin, and learn a little bit more about their firm.  And you can reach them through that website as well.  It’s financialgroup.com.

We are planning tomorrow —

Today —

With Joe Burt and Jodie Murphy on News 96.5 WDBO.  And welcome back.  This is the second segment of On the Money with the Certified Financial Group here on News 96.5 WDBO’s Ask the Experts weekend.  Joe Burt and Jodie Murphy are here taking your phone calls at 844-220-0965.  844-220-0965.  Lots of great information coming up for you, but coming in up in five minutes we’ll have the latest news, weather, and traffic with Dave Wall in the news 96.5 studio, get the latest look at the road ways and when will it start raining this afternoon.  <Inaudible> severe weather center <Inaudible> all coming up in five minutes here on WDBO.  Let’s get back to the conversation with our phone callers here.  Again, the number to dial in, 844-220-0965.  Mike in Apopka, you’re up next.  Mike, you’re on with the Certified Financial Group on WDBO.

Morning Mike.

Thank you, good morning.  My wife and I are 67.  We have a son that’s 29.  About 10 years ago we set up a separate living trust for each of us that encompassed, included, all of the joint property that we own.  It did not encompass the portfolio that we’ve accumulated together and some stocks that she inherited from her mother.  We have a 29 year old son.  We’re thinking that maybe we should set up a family trust, bring all of this under one umbrella.  Would there be an advantage in doing that?

Mike, that is a fantastic question and again, it all depends on what your assets are.  So, 10 years ago when you and your wife set up those separate trusts, the tax laws were very different.  They changed, obviously.  So, what we’re seeing a lot of are what was previously called an AB trust where a husband would have a trust, a wife would have a trust.  When the first spouse died, they could put the maximum amount that could pass tax free into a separate trust.  And the whole idea of these AB trusts was to double what could pass tax free at death.  Well, because tax laws have changed so much, right now the current federal tax law says that you can pass $5.45M per person, and that is indexed for inflation, and if you’re married you get to have a carryover to your spouse.  So, ultimately under today’s law, you and your wife can pass $10.9M tax free.  So, we’re not seeing these AB trusts being used as much for the tax planning.  Now your question of whether it would be best to consolidate into one family trust is going to depend on are you under that tax limit?  If you are —

Yes we are.

Then there’s a huge benefit to consolidating and that’s the amount of work that has to be done at the death of the first person will be greatly reduced.  So, if you have a family trust, when the first person dies, nothing needs to happen.  There’s no court filing, there’s no paperwork, everything continues on.  And then when the second spouse dies, your trust can be set up to seamlessly transfer things to your son or your beneficiaries without any court involvement.  So, I do recommend that my clients take a look at what they have in place currently, look at your assets, and decide whether it would be worth doing the work now to consolidate to make it easier at death.  It also would make it easier if you and your wife become incapacitated because now somebody can step in and manage everything that you have instead of trying to do things piecemeal.  And I think I heard you say there are some assets that you never put in the trust, some stocks and bonds and things like that.

That’s correct.

The purpose of a trust is, now, not just for the tax advantages, but to avoid probate.  And if you’ve never put those stocks or bonds in the trust, you might still have to go through probate with those assets at death.  So, the <Inaudible> to look at what you have, maybe consolidate into one family trust.  If your wife wants to keep her inheritance separate, she could possibly have a separate trust just for the inheritance, but all family assets can go into one trust and it will make things easier down the road.

Okay.  Wonderful.  You’ve been very helpful, thank you.

Mike, you’re more than welcome to call and schedule a consultation with me.  I’d be happy to review what you have.  Again, the consultation is complimentary, and if you’d like to set one up, you can call our office at 407-865-9553.

Number one more time.


Alright, just like that, if you want Jodie Murphy to answer your question on the radio today, the number to dial her up is 844-220-0965.  844-220-0965.  We are planning tomorrow —

Today —

With the Certified Financial Group on WDBO.  And welcome back, it’s the third segment of On the Money with the Certified Financial Group; Joe Burt, Jodie Murphy live here in the studio answering your phone calls at 844-220-0965.  844-220-0965.  Just so the new audience has joined us during the latest news, weather, and traffic wants to refresh everybody, what can they call you about today, Joe?

<Inaudible> I’m here to answer any questions what might be on your mind regarding your personal finances, the decisions you have to make regarding the 401k and IRA, stocks, bonds, mutual funds, real estate, long-term healthcare, reverse mortgages, annuities, all that and more.  That’s what I deal with day in and day out at the Certified Financial Group.  As I like to say, on Monday through Friday we do it for a fee, but on Saturday morning I’m here for free.  And the good news is, I also have with me today estate planning attorney Jodie Murphy, who’s worked with our firm for years, working with our clients, and she’s here to answer questions that you might have about those estate planning documents you’ve heard so much about like a will and what’s a trust, and durable power of attorney, and healthcare surrogate, and a HIPAA release form, and all those things and why they’re important, why they need to get done, and why they need to be done while you’re still capable of doing them because I can tell you I have seen tragedies walk into my office like people that had not done the estate planning and dealing with a nightmare.  The court system trying to get assets passed on, and then the family disputes that it creates, and the hardship it creates, the heartbreak it creates.  And families that just fall apart.  So, while you’re of sound mind and while you’re listening to this show, the good news for you is the lines are absolutely wide open.  So, if you have any questions about estate planning or financial planning, we are here to take them and all you have to do is pick up the phone and dial these magic numbers.

844-220-0965.  844-220-0965.  We had a caller before the news here, and this was for you, Jodie.


Her mother was recently widowed — and she did stay on the line.  Vivian, if you’re listening, please call back — mother recently widows and wanted to know what was the easiest way to get one of her children on the deed to her house.

So, a lot of people think oh, I’ll just gift part of my house.  I’ll put them on the quitclaim deed, I’ll pull a deed off the Internet, and <Inaudible> record it.  Well yes, that will put a child on the deed.  But, there could be lots of problems with that.  Number one, you have now just created a penalty if you need to apply for Medicaid benefits For <Inaudible> key benefits.

If you make a gift during the five years leading up to applying for benefits, you will receive a penalty.  So you want to make sure that we’re not doing something that could actually have more harm in the future.  Also there could be doxing <?> and taxes that are due if there’s a mortgage on the property.  So doing a gift through a <Inaudible>, not always recommended.  There is a very specific type of deed called an enhanced life estate deed, also known as a ladybird deed.  That will allow you to retain ownership in the house, you can continue to live there for the rest of your life.  You can sell the house, pledge the house, mortgage the house, but at your best it will transfer to a listed beneficiary.  That beneficiary does not have an ownership interest until you die.  So it doesn’t trigger that gift or transfer penalty or taxes.  So if you’re just looking to pass a house at death to a child or to a loved one without going through probate, an enhanced life estate deed would beautiful good option.

There you go.

Piece of cake, just like that.

Just like that.

If you have a question for Jodie <Inaudible> 844-220-0965.  844-220-0965.  Let’s get back to our phone lines here, we’ve got a couple of callers calling in.  Let’s go to Bill in Merrit Island first, Bill.  You’re on with the Certified Financial Group on WDBO.

Good morning Bill.

Good morning Bill.

Good morning.  I have a revocable <?> trust and I had heard that with that, when you <Inaudible> — you know how when you say property if you’re married, you get 500,000 tax-free or 240 single?

You’re talking about <Inaudible>

Does that preclude that?

Yes.  So if it’s homestead property and it’s a revocable trust that is properly written to own homestead property, it’s treated just as if you owned it.  So you still get the tax exemption, you still get everything that you would have as a married couple.  But you need to make sure that your trust has those provisions in it.  And usually you’re looking for a paragraph that’s titled right to reside.  That’s specifically addressed as your ability to own homestead property in the trust.

Okay, thank you very much.

You’re welcome.

Alright, thank you so much for the call, Bill.  If you want Bill’s line, it’s 844-220-0965.  844-220-0965.  Robert in Orlando has a real estate question.  Robert, go ahead.  You’re on with the Certified Financial Group on WDBO.

Hi, first of all I want to say you guys are doing a great thing here, I really appreciate what you guys are doing for us.

Oh, thank you Robert.

<Inaudible>, how can we help you?

You guys really answer a lot of questions.  I’m just now starting to get into real estate.  Well I have a question for you: If I’m buying real estate, if I want to just buy a regular house, fix it up and rent it out as a regular person, or if I want to rent to section eight, how difficult is it getting section eight, and is it possible to get out of section eight once you have a house that’s in section eight?

Well, section eight is the low income housing, as I’m sure you’re aware maybe our listeners are not.


I don’t know what it takes to get out of it.  I think it’s a difficult thing to do because you’ve got that commitment from the government, you’ve gotten a break to be able to do that property.  And to unwind it might be a little bit more complicated.  It’s beyond my pay grade to answer that question for you in detail.  You’ve got some — one thing we can address for you and I know a lot of our listeners like to dabble in real estate.  And we talked about should I do it on my own, should I set up separate LLCs, which is something that you may want to consider.  What’s the benefit of what this gentleman wants to do.  Buy real estate, fix it up, how might you recommend he would do this legally, Jodie?

And that’s exactly what I was going to jump in and suggest is if you’re looking at this as an investment and you’re not going to be living in the house.  You’re either renting it or you’re flipping it, having an LLC will protect your own personal assets in the event that you are sued.  We hear all of the time Florida is one of the most litigious states.  So if you have a tenant that comes in and slips and falls and sues the owner, if you personally are the owner, you’ve now exposed all of your assets to that lawsuit.  Of course, having good insurance is always your first line of defense.  But if you’ve now set up an LLC, think of an LLC like a bubble.  If the only thing inside of that bubble is one property and one bank account for that property, if the lawsuit exceeds the amount of insurance that you have, you’ve now segregated your own personal assets.  So you’ve created a lot of asset protection by having an LLC.  That does have to be registered with the state, you do have to maintain it like a business and pay your annual filing fees.  But it’s a very easy process to do that.

Now what if you’re really going — after this you have 4, 5, 6, 8, 10 houses?  Do you need 10 LLCs?

I do recommend that.  Because again, asset protection.  You don’t want to commingle 10 houses in one bubble.  Now you’re exposing all of your investments.  There is a vehicle in Delaware called the Delaware Series LLC.  It has not been tested by a Florida court, but we do have some clients that choose to use it.  And it services as an umbrella.  So you have the parent umbrella, and that umbrella is what’s responsible for the insurance, the taxes, the maintenance.  Paying the annual filing fee to the state Delaware.  But then underneath the umbrella, you can have 10 different buckets.

It’s like a holding company.

<Inaudible> LLC — exactly.

A holding company does all of the administrative stuff and all of the subsidiaries, if you will, are all of the individual houses that you might have out there.

Correct.  So again, several clients do use that if they have multiple real estate investments, but it has not been tested by a Florida court.  There are about eight different states that have tested and have said that yes, you do maintain asset protection in that structure, but dollar is not one of them yet.

So it’s called a —

Delaware Series LLC.

There you go, alright.

Thank you much.

You’re welcome, thanks for the call, good luck to you.

You’re very welcome.

Alright Robert.  If you want Robert’s line, it’s 844-220-0965.  844-220-0965.  We have a couple of text questions in at 21232, so let’s get to those.  First one, I believe is for Jodie here.  Hi, explain <?> that buying an annuity is a good plan for a senior citizen as an investing tool.  Ah, that’d be for you, Joe.

Well an annuity can be.  An annuity is nothing more than a contract between you and an insurance company to hold your money for a period of time and somewhere down the road to either give you that money back as a lump sum, or to turn it into a stream of income.  And annuities take all different shapes, sizes.  There’s good ones, there’s bad ones, there’s a lot of them in between.  We generally recommend that you stay away from those annuities that are offered through these free lunch and dinner seminars because they’re loaded with fixed fees and expenses and they’re very, very difficult to get out of.  We used some annuities in certain cases and a CD alternative.  Today, you can get five year annuity, about 3.5% guarantee for that five year period on a tax-deferred basis.  But it’s not for everybody, it could and should be perhaps part of a portfolio, but it isn’t an end all and be all.  So an annuity is nothing more than an investment option.  Now, we’ve used annuities —


Even I’ve used annuities in the VA side.

VA and Medicaid.  It can be a great tool to use with the rest of your portfolio if you need to convert an asset that would otherwise be deemed available for Medicaid or VA to an exempt asset.  So you can take money that’s sitting in the bank and invest it in very specific types of annuities with the hopes of qualifying for then Medicaid or VA.  It has to be done as part of an overall strategy.  You should not go out and just start buying an annuity, thinking it will give you VA benefits because most of the annuities out there do not work for VA or Medicaid purposes.  But there are several that are specifically designed for that purpose.

This is critical, because I’ve seen — unfortunately, some unscrupulous things going on in the insurance industry where annuities salesmen would come along and say well just put all of your stuff in here, and boy, you’ll be able to qualify for Medicare and all of these benefits because they won’t see <?> it’ll be in does annuity.  You’re right Jodie, it has to be a specific kind of annuity designed specifically for that, and that’s where you’re the expert.  So annuities can be good and they can also be a problem if you don’t know what you’re doing.

Alright, we’ll get back to the tax machine in just a moment.  First, let’s get back to our phone callers here.  Talk to Tom in Orlando.  Tom, you’re on with the Certified Financial Group on WDBO.

Good morning Tom.

Good morning, got a question.  A <Inaudible> single parent has a joint account <Inaudible> children.  Upon the death of that parent, <Inaudible> issue of that person — the child on the account withdrawing money and closing out the account?

It depends on how the account is set up.  So if it is a joint account with the child being an owner on the account, then no there’s no issue because when one owner dies, the other joint owner still owns the asset.  Whether, we have seen through some of our probate cases that there are ways of setting up accounts where a child is listed only as an authorized user, not as an owner.  The child thinks they’re an owner, they think it’s a joint account, but in reality it’s not.  So it’s important to go back to your bank or financial institution and find out exactly how that account is set up and if the child is indeed an owner on the account.

Okay, thanks so much.

You’re welcome.

Alright, just like that.  Thanks so much for the phone call, Tom.  Tom’s line is 844-220-0965.  Mary in Orlando has a little question for you, Jodie.  Mary, go ahead, you’re on with the Certified Financial Group on WDBO.

Thank you, hello Jodie.

Hi Mary, how are you?

Good, thank you.  We have one child and my question if everything is titled correctly, the IRAs <?>, the brokerage account, TOD to him, and we also have a ladybird trust, do we still need a will?

I do recommend everybody have a will because you don’t have a crystal ball.  We never know what kind of assets we will have at death.  Maybe your death will result in a lawsuit, and now your estate has a claim for medical malpractice or negligence.  And the proceeds or the settlement from the lawsuits go into the estate.  The will then will control the assets of the estate.  Also if you have your child listed as a beneficiary on all of your assets, your bank accounts, your IRAs, things like that, what happens if your child does not survive you?  Where do those assets go?  So having a will can serve as your back-up.  We hope that you don’t need it, and that it’s just there in the what-if situation.  But it is important to have those contingency plans in place.

While we’re on the subject of a will, many times I have seen people misunderstanding what a will is.  They think I’ve done a will, I’m going to <Inaudible> probate.  It’s going to — we’ll really you <Inaudible>

I get that all of the time.

Yes.  I’ve done my will, I’ve done me estate planning, I’m going to avoid probate.  When really a will is nothing more than your instructions to probate court <?>.

That’s correct.  <Inaudible> your one-way ticket to see a judge.  The judge then looks at your will and issues an order naming an executor and allowing assets to be transferred.  Probate is the legal process of transferring title on assets if those assets cannot transfer otherwise.  So again, if there’s a joint owner that survives or a listed a beneficiary that survives, those assets do not go to probate.

So things that go through probate, <Inaudible> the only thing is you go through probate, are those things that are in your name alone.


Alright, so if you have jointly owned property as you said earlier, it automatically passes to survivor.  If you’re a single individual, as we set up investment accounts for our clients, we set them up as what’s called TOD or transfer on death.


That avoids probate.

As long as that person survives you.

That’s correct.

And of course, the IRAs and annuities, and life insurance policies, that beneficiary designation.  And one of the things that we’ve seen a lot is people want to name their trust as the IRA beneficiary.  What’s the pros and cons of that?

So naming a trust can be a great way to make sure that your wishes are honored no matter what, especially is a child doesn’t survive or you have minors involved, grandchildren, great-grandchildren, charities.  So you certainly could name a trust as a beneficiary on any type of asset.  But you want to make sure if it’s a retirement asset, that the trust is set up to be a conduit trust.  Meaning we can look through the trust, determine who the ultimate beneficiaries are, and allow them to stretch out the distributions from that plan over their lifetime.  If it is not set up as a conduit trust, the ultimate beneficiaries will have five years to liquidate the IRA, which would mean taxes and possibly penalties within that five-year period.

That’s why it’s very, very important when that trust is done, that it’s done in the proper way because the beneficiaries will lose the opportunity to use the stretch.  So <Inaudible>, this is why you don’t want to do this online stuff.


Because if you think you’ve done it right and all of the sudden you found out you’ve just created a huge tax mess because trust hasn’t been written right to accomodate being an beneficiary of an IRA.

Right, and if your trust is not written right, then sometimes it’s better just to list your children or the individuals as beneficiaries.

She is Jodie Murphy, an estate planning attorney.  And he is Joe Berg, certified financial planner with the Certified Financial Group giving out a wealth of information for free here on the radio today.  And last segment is coming up in just a moment.  It’s your last chance to get your question answered.  844-220-0965.  844-220-0965.  We are planning tomorrow —


With the Certified Financial Group on WDBO.

9:56, four minutes to 10:00 here at News 965 WDBO, it is the final segment.  Your last chance to get your question answered with the Certified Financial Group.  Joe Berg, Jodie Murphy live in studio.  So let’s get back to our phone lines.  Ted in Orlando has got a question for Joe.  Ted, go ahead.  You’re on WDBO.

Good morning Ted.

Yeah, hi.  Thank you for taking my call.  I have a question, I have a 401k and I’m matching to a max <?> in the 401k through the employer.  My wife currently, she doesn’t work so we are maxing the Roth of 11,000 for her as well.  The only question I have is can I open an IRA and put another 18,000 <Inaudible> for my wife?

You’ve got your math a little mixed up.  The maximum that you can put into an IRA is $5,500 at the age of 50, okay?

Alright, so I’m doing mine 55 <?> and hers 55, are we doing 11,000?

Okay, good.  And your question is — go ahead.

Now can I — my question is can I do an additional 18,000 in an traditional IRA for her?

No — you’re thinking of what you’re able to put into a 401k or 403b, no you can’t.  You can <Inaudible>

So pretty much the only I can do for her is the 5,500, that’s it?

That’s correct.  Now you said you’re maxing out your 401k, you’re putting in the 18,000 into the 401k?


Very, very good.

Well I’m putting a little bit less than 18 because the employer is — can I do 18 plus the employer or <Inaudible>

Oh yeah, yeah.  <Inaudible> you’re under the age of 50?

No, I’m 40 right now.

Yeah, so you’re under the age of 50.  You can put $18,000 of your own money, regardless of what the employer does or does not put in.  That’s what you ought to be striving for, yes.

Okay, so then anything extra then I should just do like a brokerage account or tax <?> brokerages, I can’t save anymore?

Well, there’s no other tax way to go.  You can do a perhaps a deductible IRA for each of you without knowing your tax situation.  Or perhaps the Roth.  But yes, you can do that.  Or a non-deductible IRA is always available to you.  Once again <Inaudible> you wife can’t put in the 18,000 because she’s limited to just an IRA contribution.


I appreciate the call.

Thanks, Ted.

Alright Ted, thank you so much for dialing us up.  We’re all out of time.  We have one quick question for Jodie on the texting line: What is the name of the deed you transfer upon death for a house?  You weren’t clear on that, he said.

That is called either an enhanced life estate deed, or a ladybird deed.

Gotcha.  Alright, Joe.

We’ve got a workshop coming up July the 11th.  Gary Abely, CPA, CFP is going to be talking about healthcare options in retirement.  Everything you wanted to know about Medicare, what do I need to do, why all of those A, B, C, D, E, F plans, what do I do?  Part A, Part B, what’s deductible, what’s not?  Part W?  Gary is going to handle that.  Go to our website financialgroup.com, that’s financialgroup.com.  Click on workshops, it’s going to be Tuesday, July the 11th attorney offices in Altemonte Springs, 6:00pm to 8:00pm.  You can <Inaudible> some light refreshments and you walk away with some really good information.  So once again, our website.  Financialgroup.com, click on workshops and you can make reservations right there.  There’s no Part W, that was a Joe-ner <?>.

Alright, that’s going to do it, boy did that go by fast.  A lot of information, great information, great call.  Great texts.  You know what, let’s go ahead and do it again next Saturday at 9:00am.

We’ll do it, shall we?

Alright, Florida Homes and Gardens is next here on News 965 WDBO, Ask the Experts weekend.  But first, the latest news, weather, and traffic from Dave Wahl from the News 965 newsroom.

Dictation made on 6/14/2017 2:42 PM EDT.

Hosts: Harry Stadelmayer, CFP®, AIF® and Joe Bert, CFP®, AIF®

Hello everybody and welcome to On the Money with the Certified Financial Group here on News 96.5 WBBO’s Ask the Experts weekend.  We are taking your phone calls at 844-220-0965 with Joe Bert and Harry Stottelmeyer from Certified Financial Group.  Joe, how are you today.

Good morning.

Hello.  What can the audience call you about.

You can call us this morning about anything that’s on your mind regarding your personal finances.  Harry and I are here to answer those questions, kind of clear up that mind fog about those decisions that you might be making or things you may be considering as we work our way into the future and your planning for retirement.  As we say, that we go through life trying some of this, trying some of that, and wake up when we’re 55 years old and find out we haven’t done any planning, and that we have a <Inaudible> financial accidents tucked away, and we’ve got to get it straightened out.  Harry and I are here to answer your questions that you might have about stocks and bonds, and mutual funds, and real estate, and long-term healthcare, and IRAs, annuities, life insurance, reverse mortgages, all that and more.  Monday through Friday at Certified Financial Group we do it for a fee because we are fee only planners.  On Saturday morning we do it for free.  So if you have any questions about your personal finances, anything that might be on your mind, give us a call.  The good news for you is the lines are wide open and you don’t even need to use your name.  You can make up a name like Jack, Daphne, Loretta, or whatever you want.

I just want to know how to refer to you <Inaudible> call you on the air.  You can say number seven.  Okay, number seven in Orlando, yeah, we’ll take that.  844 — oh, go ahead.

The lines are wide open, go ahead.

844-220-0965, 844-220-0965.  We also have the text machine up and running as well, 21232.  That’s 21232.  Keep it to about 160 characters, that’s all we can see on our screen.  I’ve got a question in e-mail the other day, why do you always ask for 160 characters.  Well, that is the average amount of one text for all the phone carriers.  Anything past 160 characters you get charged for two texts.  So our machine only sees one text at a time, which equals 160 characters.  That’s the way our system works, that’s what it is.  So if you’ve got AT&T, Verizon, Sprint, everybody’s covered.

Now we know.

That’s how it works.

Know about that.

But 160 characters, that’s all we can see in the text line.  But well gentlemen, Harry, a lot of people don’t know this about you, but you are a big golf enthusiast.

I am.  I have been.

We’re talking to former past chairman of the Arnold Palmer Invitational.  There was something in the headlines this week that you saw and you let me know, you know what, I have something to say on the radio today.

Well, it’s as many of our listeners know, I’ve been involved with the Arnold Palmer Invitational for over 24 or 25 years.

Started out in the parking lot handing out donuts, ended up running the whole thing.

That’s it.  My good friend obviously has passed.  In the news this week was just a little article about his will being released to the public.  I think it was kind of a shock to me, and I think the take-away from this little conversation is not was it right or wrong, but when folks get into planning, financial planning, estate planning, hopefully all their ducks are in a row.  I was quite shocked to see that Mr. Palmer’s will was released, which kind of shocked me a little bit.  We never talked really financially.  He knew I was a financial planner, but I was a little shocked that his will was released, which becomes public record.

It doesn’t need to be.

And it doesn’t need to be.

That’s the interesting here, who is really do his estate planning.  Somebody of that stature has all of his personal situation, and who he favors, and who got what open to the public and there for scrutiny.  Now look, there’s no rights or wrongs there.

No, not at all.

But particularly somebody like him who was a very private individual, you would think that he would want to keep that stuff confidential.

So the point here is if you’re doing estate planning and you’re looking at the benefits of a will versus maybe a trust, that’s one of them, is that it is kept very, very private —

If you use the trust.

If you use the trust.  That’s correct.  Just an FYI.  We’ll leave that alone.

Interesting.  Yeah, no, that’s one — you would think that.  I was like well, okay, if you’re somebody who’s in the public, or even if you own a small business, you don’t want your employees finding out.  Even if you own a small restaurant on the corner, you don’t want that to get out.  Privacy, trust versus a will.

It’s very easy to do.

Because a will is <Background Noise> people don’t understand this, they think well I’ve done my estate planning, my will, I’m going to avoid probate.  But your will is really the instructions to the probate judge.  It will go through probate, and when it goes through probate, it’s a public record.  So this is what happens.

And when you start looking at the dollar amounts — it’s anticipated there was about 800M of net worth there, another reason to be looking at estate planning because of the taxes and all that that’s involved.  There are many methods of doing it.  So if you’re out looking for estate planning, consider that.

That’s it.

Well, let’s get started with today’s questions on the phone lines.  It’s 844-220-0965, 844-220-0965.  Bob in West Melbourne’s going to kick us off today.  Bob, go ahead, you’re on the Certified Financial Group on WBBO.

Good morning, Bob.

Yeah, good morning.  Thanks for taking my call.


The only <Inaudible> I have is my primary residence, okay.  We owe about 128,000 on that.  We wound up with over 30,000 in our personal savings.  I don’t know if I’d be better off to invest that in something else to earn more interest or swap <?> it toward the house, keep like 10,000 and maybe put 20,000 somewhere else.  I was just wanting to get you guys’ input on what I should do with that.  Because I hate just having it sitting around and earning basically no interest, you know what I mean.

Of course, of course.  Well let’s back up here.  First of all, how old are you.

I’m 53.

Okay, and you plan on staying in the home I guess.


How far are you into the mortgage.  Is it a 30-year mortgage, 15-year mortgage, what was it.

I will have it paid off in about 12 years at the rate that I’m paying, because I’m paying more towards it.

Was it a 30-year to begin with.

It was.

It was a 30, okay.  So you’re to the <Inaudible> crossover point where most of your payment is going toward principal and not to interest anymore.  So you’ll save some on interest if you pay it off.  Now let’s back up here.  One of the most important things you probably need to be considering is what happens when the paycheck stops, right Harry.


Okay.  So you’re 50 — how old did you say you were.



I mean, I can retire in 10 years, but —

Alright, so let’s look at that.  At this point, really the only asset we have is your home and the $30,000 that you have tucked away in the savings, and the savings isn’t earning anything.

Yeah <Inaudible> that are separate <Inaudible>

There’s no retirement plan of any sort.  No IRAs, no —

Oh, yeah yeah, oh —

Oh, okay, so we have other assets.  That’s where I was — I read a different angle.  If there are other assets, this is just money that you’ve accumulated in the checking account that is on and above — you’ve got good cash flow, positive cash flow, is that right bob.

Yeah, we’re good.  I mean, we have our retirement account <Inaudible> that’s just extra that I feel I should do something with on that.

Well, we — Joe and I always advocate that you do keep an emergency cash fund available.  Typically we look at three to six months of living expenses as kind of a general rule.  Now, a lot of that depends on — you’ve mentioned that only debt you have is your home.  We get this question a lot is I’ve got $30,000, $40,000.  I’m looking to maybe buy a car in six months, what should I do with that money for the six months.  The answer is nothing.  If that money is earmarked for anything, and maybe in your case Bob it’s not, but if that money is earmarked for anything and you “invest” it to try to get a couple percent more, and this market takes a turn on you, you’re not real happy when it comes time to pull the money out.  I do want to make sure that you do have a cash reserve that you can go if the water heater goes or your roof goes.  Then certainly if you have that covered, then you may want to look at putting the money aside, maybe a nice growth or growth and income fund because you are very young at 53.  You have 40 years theoretically for life expectancy.

Let’s talk about the retirement plans that you’re using.  Do you have a 401k at work.

It’s a TSP, yeah.

A thrift savings plan.  Okay.  Does your wife work outside of the home.

She doesn’t any longer, but she has probably 50,000 in her retirement <Inaudible>.

How much are you putting in your TSP every year.


What’s that come to in dollars.

About 6,000, 7,000.

Okay, here’s what you want to do.  You want to max out your contribution to your TSP.  At your age, you can put $24,000 a year into that.  What I want you to do is to immediately go to HR on Monday and tell them you want to increase to the max that you can, which is $24,000.  That means you’ll be bringing home less money, right.


Okay, so what I want you to do then is take the money out of your checking account that isn’t earning you anything and use that to make up the difference that you’re not bringing home.  By taking the money out of your paycheck, you’re immediately getting a tax deduction, saving money right off the top.  Now you’re building a retirement fund.  That money will grow a heck of a lot faster than it is in your checking account.




Alright, thanks for the call.

Thanks for your advice.  Bye.


We appreciate it, Bob.  If you want Bob’s line, it’s 844-220-0965, 844-220-0965.  Jacob in Orange City is up next.  Jacob, you’re on the Certified Financial Group on WBBO.

Good morning, Jacob.

Good morning, boys.  How are we doing today.

Good, what’s up.

Alright, good, good, good.  My question is like you kind of talked about earlier a few minutes ago, I of course am worth more dead than alive.  I don’t really have a whole lot going for me.  I’ve got a 401k and all that good stuff, but as far as a will is concerned, I’ve got my children as my beneficiary.  But as far as my things, like my motorcycle, my tools and whatnot, does that have to be written down in, I don’t know, a legal sense to basically leave to my son.  I was talking to your screener, it’s more my ex-wife isn’t interested in my Craftsman.  She’s not interested in my small boat.  Mostly my son’s interested in stuff like that, my motorcycle and whatnot.  Does that have to be so legal or can I just — dear son, sorry I left you.  This is what I have for you — kind of thing.

First of all, do you have a will.

That’s what I’m kind of getting at.  It’s piddly stuff like that, does that need to be in a will.

Life changes.  You know, you might sell the motorcycle, buy a motor home.  You might sell the motor home and buy a camper, who knows what.  Life changes.  What you do is you get the will done, because that’ll kind of clear up these loose ends.  Then at that point in time, you can decide who gets what, but then you can attach what’s called a codicil to the will.  This is your own handwritten thing that you can write in your own hand, it doesn’t have to be fancy.  You don’t have to go see the attorney.  Write in your own hand I want to leave my motorcycle to my son, I want to leave my boat to my granddaughter, I want to yadda-yadda-yadda-yadda.  Date it, have it notarized, and attach it to your will and you’re done.

It’s that simple.

You can get as specific as you want.  Your coin collection, your rings, whatever, whatever.  The more detail you have in it, the easier it is for the probate judge to determine really what your intentions are.

Jacob, you said your ex-wife, just making sure.  So you did go into your 401k, your life insurance policies, etc., etc. and change the beneficiary.

Yes, sir.

That is a mistake that we see many times is folks kind of forget that, and that becomes real ugly and real nasty at death.  Good for you.

Do you have any accounts outside of your retirement plan, any savings accounts, checking accounts, and so forth.

Yes, but my current wife is attached to those.

Okay, got it.

There’s no misunderstanding with that.

I always say this, Jacob: a will is not very expensive to establish, and with a will there are typically five or six additional documents.  It’s just not about your instructions from the grave as to where your assets go, but God forbid you get hit on I-4 and you don’t die, there’s things called living will, durable power of attorney.  Who pays the bills if you’re incapacitated.  There are so many parts to the will, it’s not just about where are my assets going.  And for a nominal small fee, you have it done, you put it aside.  It’s kind of like the fire extinguisher on the wall.  You don’t know if it’s really working until you have to use it.  This is another situation where you want to make sure that will is solid, concrete.  Put it aside, pay a couple bucks, and it’s really to benefit your children to be honest with you, and your wife.

Now that you bring that up, without actually having a will, I know that she does have — my current wife does have power of attorney if I’m not able to make that decision.

Good, that’s good.

You’re ahead of the game, that’s great.

Just is I just need to have the will drawn up for my —

The loose ends.

The things that are in your name alone are all the ones that are subject to probate.  Probate decides who gets what.  So, to make it a lot easier, have a simple will drawn and whatever your intentions are at that particular moment.  Then, as I said, as life progresses and you get rid of the boat, you buy the camper, you get rid of the camper and buy who knows what, buy another boat, and you want to leave it to whomever, just attach it to the will, get it notarized, and it’s done.

Alright, well Jacob, thanks so much for the phone call.  If you’d like Jacob’s line, the number to dial us up is 844-220-0965, 844-220-0965.  Joe Bert, Harry Stottelmeyer are certified financial planners with the Certified Financial Group, where we are planning tomorrow today.  Time for the three big things you need to know. <Background Noise> Hey, welcome back.  This is On the Money with the Certified Financial Group here on News 96.5, WBBO’s Ask the Experts weekend.  This is the show we help you get to that retirement finish line with plenty of nest egg money for you to sit back and enjoy those golden years.  Joe Bert, Harry Stottelmeyer, right here in the studio, answering your questions at 844-220-0965.  844-220-0965.  We are three minutes away from the latest news, weather, and traffic with Dave Wall in the News 96.5 news room.  Let’s get right back to our busy phone lines, talk to Logan in New Smyrna Beach.  Logan, you’re on the Certified Financial Group on WBBO.

Good morning guys, thanks for taking my call.

Sure, Logan.

Just a quick question for you.  I’m 29, I did four years in the Marine Corps.  I do collect disability every month and make about $1,500 every two weeks or a little over that.  We just sold our first house, I have a young family, and we have about 15,000 sitting in the savings.  And kind of piggy-backing off a couple callers ago, I’m just uneducated when it comes to Roth IRAs or CDs or anything like that where if I wanted to invest a little bit, nothing too risky, what would be the best plan of attack for that.

Logan, how’s your debt situation.

Other than our home that we just bought and our truck payment, that’s really all I have.  I don’t have any other debt than that.

Okay.  You’re contributing to a retirement plan at work, or are you — <Background Noise> you’re disabled, right.  You said you were disabled, is that correct.

Yes, 60%, but I still work as much as I can and I do have a job, but we don’t have any benefits as of yet.  Next year we’re hoping to be able to establish that.  But like I said, I have about 15,000 in savings, and not looking to use all of it, but I didn’t know if it’d be smart to take a chunk of it.  Again, I’m not as educated as I should be on different ideas as far as investing.

Do you have any children.

I have one, a son.  He’s four years old.

Four years old, okay.  Here’s what we need to look at first and foremost is insurance.  Insurance isn’t exciting, insurance isn’t investing, but what happens if something happens to you and your wife, and who takes care of the baby, and how do we cover that expense for the next 15, 20 years.  Your disability is physical.


Okay, obviously it’s physical — not obviously, but it’s physical.  It may not affect your ability to get life insurance, or if it does it may not be as bad as you think.  I would like you and your wife to consider buying life insurance as a starting point.  What you want to look at is term insurance.  Term insurance is the most cost-effective way to buy insurance.  You have a four-year-old; look at a 15 or 20-year policy to get him through those grown-up years and perhaps through college.  You’ll need more life insurance than what you think, but the good news is at your age, it should be relatively inexpensive.  From then, you’ll want to look at setting up an individual retirement account.

Perhaps an IRA or potentially a Roth.  You’re 29 years old, so I believe it’s — what is it, 5,500 this year.  I believe it’s $5,500.  You could put that aside.  You don’t have to fund it all at once, you can put it in monthly, you can do it quarterly, however you feel comfortable doing that.  I typically recommend if you’re just starting out and you’re not looking to go to a financial planner and get some information, many times just go on to Vanguard.  It’s a wonderful, wonderful website.  Take a look at the different mutual funds.  It’s very easy to set up.  You print the application, set up a Roth.  The beauty of the Roth is again it can grow for you tax-free over the years.  Or if you’re looking for the deduction in the current year, you can set up a regular individual IRA.  You can do one for yourself and for your wife as well.


You’re looking at 5,500 between the two of you, we just took care of $11,000 of the $15,000 for you.

Well, Logan, thanks so much for the phone call.  If you want Logan’s line, it’s 844-220-0965.  If Logan wanted to give you guys a call this week, what’s the number to do that.

407-869-9800.  407-869-9800 will take you right to our switch board.  We’d love to meet with you if you have a pressing need.

Go to the website, financialgroup.com.

Garfield and Carrie, hang on the line, you guys will be next up after the latest news, weather, and traffic.  We also have some great text questions.  We’ll get those all answered on the other side, the second half of On the Money with the Certified Financial Group, where we are planning tomorrow —



Information presented on this program is believed to be factual and up to date, but we do not guarantee 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.

And welcome back.  This is On The Money with Certified Financial Group, a part of Hughes <?> 96.9 WDBO’s ask the experts weekend.  We’ve got Joe Burton, Harry Steilmyer answering your questions on the radio today at 844-220-0965.  Joe, for all the people that <Inaudible> news, weather, and traffic here, I’d like to re-state <?> what can the audience call you about today?

You can call us about anything that’s on your mind regarding your personal finances.  You’re going to have to make decisions either now or sometime in the future about what to do now so you don’t look back five or ten years from now and say, gee, I wish I would’ve known and had already prepared for retirement, because someday in the future that paycheck will stop, you’ll have Social Security, and plus whatever else you’ve been able to save over your working lifetime.  So as we say on Monday through Friday, Barry and I and the other certified financial planners at CFG do it for a fee, but on Saturday morning we are here for free.  If any questions on your mind regarding your personal finances, the good news for you, there’s still a couple of lines open; all you have to do is pick up the phone and dial the magic number:

844-220-0965.  We do have the text machine up and running as well: 21232 is the number to do that.  Keep it to about 160 characters.  That’s all we can see on our screen.  And we’ll get to some of our text questions in just a moment.  The other thing you guys do as the Certified Financial Group that sets you guys apart is your workshops.  Not only do you get on the radio in <Inaudible> central Florida, you guys invite people into your classroom.

We do, Kyle.  We have a nice board room over on Douglas Avenue, and this Tuesday, I believe that’s June 6th, Tuesday, Gary Ably does a wonderful job, and the workshop is about retirement and titled What’s Your Number.  As Joe stated earlier, we go through life and we have all these financial accidents and we’re throwing darts and we hope everything ends up working out for us.  Gary’s going to sit down and plot out what you need to do.  What is your number.  What is that retirement number.  I know Fidelity — I think it was Fidelity — years ago had this commercial on TV with people running around with this number under their arm.  That’s what Gary’s going to be talking about.  And that’s June 6th, that’s Tuesday from 6:00 to 8:00.  Leave your checkbook at home, we’re not going to try to sell you books and tapes and any kind of a sales pitch; it’s just really good information.  And why do we do this?  You may need us now or maybe sometime in the future.  We want you to know who we are, what we do, and how we do it, and why we’ve been doing it for, what, 40 years in central Florida.  So if you’re looking for a seat, go to our website at financialgroup.com.  You can go in, click, register, say hey, I want to be there, or you can call our office on Monday at 407-869-9800.  That’s this Tuesday, June 6th.  What’s Your Number.

6:00.  6:00.  6:00 to 8:00.  6:00pm.  And he’ll serve some light refreshments and you can come right from work so you won’t go home totally hungry.  Not serving you a five course dinner, but it will tide you over until you get to your favorite restaurant or get home.  It’ll be good information, and hope to see you there this Tuesday at 6:00.  Go to our website, financialgroup.com, and click on workshops.

Alright, let’s get back to our busy, busy phone lines.  Garfield was up next.  Garfield, go ahead.  You’re on the Certified Financial Group on WDBO.

Good morning, Garfield.

Good morning.  Thanks for taking my call.  How are you guys doing?


Garfield, all the years we’ve been doing this program, you’re the first Garfield.

Oh really?

Yes.  Yes.

That’s good.

<Inaudible> just back up here.  I want to explore this.

Uh-oh.  Here we go.

Do your friends call you Garfield or you have a nickname?

No, they call me Garfield.

Garfield.  Okay.  Alright, Garfield.  How can we help you?

I’ve got a couple questions.  First one, I owe the IRS about 10,000 and I’ve been hearing on the radio about the fresh start initiative.  Do you guys have any information as far as how that might work?

Don’t know about those particular programs.  What’s been your conversation with the Internal Revenue Service?  Have you had any conversation?

Well, they gave me an option of taking a <Inaudible> monthly payments, automatic debiting the checking account.


Without <Inaudible> the fresh start initiative.

I can’t speak for them, good, bad, or indifferent, Garfield.  I don’t want to give you some bad information, so I do not know.  I haven’t either, Garfield.  I haven’t had real experience with that.  I know that when the IRS is knocking, you listen.  So I don’t know where he would go to find out —

Are you having trouble making the payments, Garfield?

No, I’m not.

I’ll tell you what you can do.  You can talk to the IRS — what’s called the advocate, and sit down with them, and sometimes they will cut you some slack, and you may want to start there.  Doesn’t cost anything to do that.  They are user friendly, believe it or not.  Irs.gov, go to advocate, and that may be an easier way for you to go.  These other services, I believe they’re going to charge you a fee, and of course if they save you some money it may be worth it, but I’d start with the IRS — start with the least expensive way first, and then if not, then you may want to go for those other services.  And I’d like to hear from any of our listeners that have had experiences with debt relief program.  So let us — go ahead Garfield.

That’s the advocate — you said that was the advocate —

Advocate.  Irs.gov, yeah, look for what’s called the advocate, yes.



Now my other question — I have a question.  I’m 55 right now and I don’t have any life insurance, and I’m wondering if I should do whole life or term insurance.

Well first of all, do we even need insurance.  Do you have a family, do you have dependents?

I have no dependents, just me and my wife.

Just you and your wife.  Okay.  Term insurance is the best way to go.

Term insurance.

Term insurance is the best way to go, and you can do that almost online as a matter of fact.


Select Quote.  Go to Select Quote, you’ll find some rates there to help yourself.

Select Quote.  Okay, thanks guys.

Alright, good luck to you, Garfield.

Alright Garfield, thank you so much for the phone call.  If you want Garfield’s line, it’s 844-220-0965.  Carrie in Orlando.  Carrie, you’re on with the Certified Financial Group on WDBO.

Good morning, Carrie.

Good morning, how are you?

Good, how are you?

I’m very good, thank you.

Good.  What’s your question, Carrie?

My question is I’m due to retire in 20 months.  I’m currently in the DROP program.  I also have some deferred comp, like $60,000, and my DROP will be like 180, plus my retirement fund in 20 months.  And I know they charge — I mean, the interest is like 20%, and I need to know what to do with that when I get out, because I haven’t sought a financial advisor yet.

Okay, I love that word yet, because —

Yeah.  I need one.

First of all, do you have something on the fridge that says, 20 months, 19 months, 18 months?  Do you have a countdown clock?

I sure do.  I do.  I’ve thought about it.  21 to the day.

Well good for you, Carrie.  This is the time for you to seek guidance.  You have a lot of decisions that you’re going to be facing over the next 20 months, and you can’t afford a mistake.  As you walk down this road, let a professional who does it all day every day, whether it’s our firm or another certified financial planner, help you go down this path, because there’s a lot of number crunching that really should be done as far as what to do with the DROP.  It’s a substantial amount of money for you, and again, no mistakes needed at this point.  So you really want to seek some guidance.  We offer a consultation, you come in, it’s very low key, we’ll ask you a lot of questions and at least get you started into the right direction, Carrie, as to what do you do when that magical day comes.  And the other thing is, we want to make sure that when you walk out of that office and that paycheck stops, that that money’s going to last the rest of your life.


So it’s not just about here, I’ve got a little bit of money, let me throw it into this fund or this fund or this fund.  We need to know how aggressive or conservative do we invest the monies, and where do we put it.  So there’s a lot of moving parts here, Carrie.  So I liked when you said yet, because at least you’re thinking in the right direction.

Carrie, at the risk of sounding a little self-serving, you definitely want to work with a certified financial planner who’s going to do this for a fee for you.  There are a lot of gimmicks out there; some say, well we normally charge a fee, but if you call in the next 10 minutes we’ll do it for free, this kind of stuff.  Their real objective is to sell you something.  What you want is some objective advice, and we’ll tell you the good, the bad, and the ugly and what you need to do now, so like I say, you don’t look back five or ten years from now.  And the fee is oftentimes a lot less than what people think.  And the thing that I see — what I see when Harry and I do planning is that people walk out of there with peace of mind.  For the first time in their lives they know where they are, what they need to do to get ahold of it.  And when you start your retirement years you have a high degree of confidence that you’re going to be okay.  Give Harry a call on Monday morning at 407-869-9800, or go to our website, you can find Harry’s smiling face, click on that, and they would love to talk with you.

Sounds so good.  Thank you gentlemen.

Thank you Carrie.

Good luck Carrie.  Best wishes.

Alright Carrie, thanks so much for the phone call.  If you want Carrie’s line it’s 844-220-0965.  We also have a couple of text questions here.  I want to get to those before we get to the three big things you need to know.  Let’s start with this one: What do you think of investment apps Acorn and Stash?  Are they safe, and do they have any catches?

Acorn and Stash basically is a way of accumulating some money through apps on these smartphones.  I think they’re very, very new and I don’t have a lot of experience with them.  I know they can be a little bit expensive, I think they charge $1 a month, so if — Bank of America used to do something called Round-up, and this is kind of a takeoff on that.  So if your latte is $4.22, they round it up to $5, they take that money, they put it into a little investment account, and you can select the different investments.  So it’s a way of accumulating some change, if you will, as you go through with your all-day expenses.

A lot of us take the change and put it in the jar at the end of the day, you know?  You take it out of your pocket — what do you do with the loose change in your pocket?

I have a — you’re going to laugh — I have a bucket it goes into, and once a year in December I go to that stupid coin machine and pay 10%.  That’s what I do.

But this is a way to do that and <Inaudible>.

Yeah, that’s exactly right.

They are legit.  <Inaudible> it’s a way to accumulate some capital and then you can use it for your Christmas fund.

Alright, there you go.  Just like that, text question answered.  21232.  Well we are up against the break to get the three big things you need to know.  Joe Byrd, Harry Steilmyer are here every Saturday morning at 9:00 on WDBO, but they are <Inaudible> during the week.  What’s the number to reach you guys during the week?

407-869-9800.  Or our website at financialgroup.com.

And we are planning tomorrow today on WDBO.

96.5 WDBO.

And welcome back.  This is Florida Homes — I’m sorry, no, this is On The Money.  Not yet, it’s not 10:00 yet.  I’m sorry.  It’s not 10:00 yet.  I saw Tim and Bill walk in and I got distracted.  No no no no no.  It’s still On The Money.  It’s the final segment of On The Money with the Certified Financial Group here on News 9.65 WDBO.  It’s your last chance to get your question answered at 844-220-0965.  We’ve got two callers left.  Let’s go to Rich in Orlando.  Rich, you’re up first.  Go ahead with your question with Joe Byrd and Harry Steilmyer.

Good morning guys.

Good morning.

Okay, here’s my situation.  I recently started a new business, and I’m having a hard time getting qualified for a home loan because I haven’t been in business for two years.  Now, with that being said, I draw a small paycheck, and I think what’s going to happen is when my two years is up, I’m not going to show enough on the books to qualify for the home that I really can afford, and I’m just kind of looking for some suggestions on how to go about that.

Well, they’re going to want to look at your tax return.


Even though you’re not drawing a paycheck, your tax return hopefully is representative of the income that you’re earning.  And if you’re not, you’re a tattle cheat <?>, end of story.

Yeah, exactly, exactly.

So that’s what you’re up against.

Well I mean — well, with now having my business, there are a lot of things that I can —

Of course.

— write off through the business, but I do draw a small paycheck.  But unfortunately I think what’s going to happen is at the end of the year they’re just going to say, well, you’re only qualified for a $100,000 home.

Rich, do you have any other debt, because this is about debt/equity ratio.  Do you have any debt that we can eliminate over the next year or two?

I recently have a boat loan, but I have zero credit card debt.  I have one truck loan, so a small monthly payment on that.

Okay.  Well, like Joe said, it’s a tax return situation, and they’re going to — even though you may be drawing a small salary, I think it was your schedule C will reflect how well the business is doing, and all I can say is shop mortgage brokers until you find one that hopefully will help you.

Where have you looked for a mortgage?

Oh, I’ve been everywhere.  My credit union, my bank, a couple private loaners.  I’ve been — everybody gives me about the same story.  I’ve got to have two years just to show them that it stands.  But even though my income has actually gone up since my previous job, it’s still — I’m kind of stuck between a rock and a hard spot <Inaudible>.

Well, it’s like Harry said, it’s going to come down to your tax returns, because they’re going to look at your ability to make that mortgage payment, and with the changes in the banking laws ever since the crisis, it’s gotten tougher and tougher, and you’re experiencing that.  Wish you well.  There’s really not much in the way of alternatives.

Alright, let’s get to number seven.  Number seven, you’re on <Inaudible>.

Number seven, good morning.

Yeah, hey, number seven here.  I should’ve called earlier because I know you’re almost closing, but I just — I still don’t get the capital gains.  In other words, I have to take in the capital gains 1099s, whatever they’re called, and then when I do sell the fund, I’ll still have to pay the money on it.  You see what I’m saying?  It’s like paying for something that’s imaginary, and I don’t understand that.

You’re talking about the capital gains that are reinvested in your mutual funds, you’re paying taxes today and then you’re going to have to pay taxes again.

Right, right.  I mean, it’s not — I don’t have the money, but — go ahead.

Well, basically what happens, number seven, is that basically adds to your basis, so let’s assume that you had $20,000 and you had a long-term capital gain and you had it reinvested and now it’s — it was a $1,000 capital gain, it’s reinvested back in the fund.  Now your cost basis is at 21,000, so when you go to sell and your investment goes to 25,000, it’s not the 20 you put in, it’s the 21 you pay.  You pay long-term capital gains on 4,000, which is at 10%, and so it does add to your basis, so you really don’t pay twice on that.

Yeah.  It feels like it because you’re not seeing it and you’re paying taxes today, but as Harry said, a really adds to the original investment to reduce the capital gains when you ultimately sell that investment.

Joe, Harry, what’s the number to reach you during the week?


And don’t forget the workshop, Harry, workshop on Tuesday, Know Your Number.  Go to our website, financialgroup.com, click on our workshops, and hope to see you there 6:00 on Tuesday evening.

We have been planning tomorrow today with the Certified Financial Group.  We’ll see you next week, 9:00am, right here on WDBO.

This is News 96.5 WDBO with Orlando <?>

Dictation made on 6/13/2017 6:30 PM EDT.

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

Well hello everybody, welcome to another addition with On the Money with the Certified Financial Group here on News 965, WDBO.  We are here with Joe Bert and Gary Abely from the Certified Financial Group.  Guys, how are you this morning?


Good morning.




Keeping a little cool out as <Inaudible>


Oh, beautiful morning.


It is nice, a little smoke in the air, but <Inaudible>


Oh yeah.


I wondered where is that fire, does anybody know?


I don’t know, could be anywhere.


Did you smell it when you came up <Inaudible> this morning?


I did not, I did not.


I didn’t either, so it must be down somewhere —




I don’t know <Inaudible>


Or east?


Or downtown <Inaudible>


If anybody knows where the fire is, let us know.




There you go.


They’ll text it, <Inaudible> all know.


Hopefully it’ll be out very, very soon before that <Inaudible>.  But Joe, what can the audience call you about today?


Well Gary and I are here this morning to talk about anything that’s on your mind regarding your personal finances.  As we oftentimes say, we go through life trying some of this, trying some of that, and wake up one day at age 55, look across the breakfast table to Loretta.  And say Loretta, you know the kids are gone and here we are, we’ve got retirement staring us in the face, what have we done?  And then Loretta will say well went to this seminar a couple of years ago.  We bought that annuity, and that’s not working out just like we thought it was, and you’ve got your 401k and your IRA.  And we’ve got some Social Security going to come in.  Do you think <Inaudible> we’ll take those vacations like we want to do, and do all of that stuff?  And all of those things that run through your mind as you’re trying to plan for what we call those golden years, are things that Gary and I and the other certified financial planners at CFG do.  Helping out clients plan for retirement.  So it’s what you need to do now so you don’t look back 5 or 10 years from now and say gee, I wish I would have known.  Or gee, I’m sorry I did this or that.  So we’re here to clean up the mind fog that you might have regarding your personal finances.  Questions that you might have about stocks and bonds and mutual funds, real estate, long-term healthcare, IRAs, annuities, life insurance, reverse mortgages, all of that and more, we are here to take your call.  So if you have any questions about any of those topics or anything else I might not have mentioned, the good news for you is to pick up the phone and dial these magic numbers.


844-220-0965.  844-220-0965.  Or you could text your question to 21232.  Gary Abbely from the Certified Financial Group is here as well.  Gary, how are you?


I am doing terrific.


Gary, do you have any workshops coming up?


We do indeed.  We have one coming up Tuesday, June 6th, from 6:00pm to 8:00pm.  And that — well we used to call that Will You Outlive Your Money, which is just what Joe was talking about.  But T. Rowe Price said hey, that’s our name.  So we’ve renamed it When Can You Retire, Know Your Numbers.  So the purpose of date workshop is to actually calculate during the workshop based on your spending what you will need before you say see you later to your boss.  So we don’t want you to quit before we know that you’re going to be okay.  We want you to have at least a 90% probability of not outliving your money.


But as they’re going through this process with you, it’s confidentially.  You’re not going to ask <Inaudible>


Oh absolutely, right right right <Inaudible>


And everybody is going to have their own opportunity <Inaudible> workshop.


Right.  And then we go through — we actually go through an example that will help everybody take that example home and then calculate it on their own.  The next workshop we have is July 11th and that is on healthcare options in retirement.  And there’s a little confusion in the media right now on Plan F, which is kind of the Cadillac on Medicare supplements, so we’ll help clean that up so people aren’t worried about that.  But we talk about not only your Medicare options and other healthcare options, Medicaid, but we also talk long-term care which is something that a lot of folks will put off until their mid-50s, mid-60s.  And we recommend you consider well before that time.  That market is just getting tougher and tougher.


Let’s circle back to the Medicare supplement because I find in meeting with clients that haven’t had to deal with this for themselves or with their parents, they’re somewhat confused when they get into those — that age 65, they say I’m going to have Medicare, what does that do for me?  Which is Part A, Part B, Part C, Part D, you just mentioned Part F.  They’ve got more —


Actually, Plan F.


Or Plan F, that’s right.


Like it is confusing.


It is Plan F, not Part F.  You go down to Plan Z, probably.


<Inaudible> the Part F.


Yeah, what’s that all about?


Well, so Part A and B cover about 80% of your hospitalization and your doctor visits.  And of course we know that if you have a 20% exposure, that is way too much.  So the industry has come up with things called supplements that help pay that 20%.


So A and B is provided by the government.


Well, yes and no.




Part A is you’ve been paying for it all your life, and Part B you have to pay for once you hit 65.


Right, but yet they’re government programs.


They are government programs.


And Part A covers —


That’s going to cover your hospitalization.


So go in the hospital, pay the hospital bill, but not the doctor.


That’s right.


And then Part B covers that.


They cover the doctor business, outpatient surgery, and <Inaudible>


But it doesn’t cover it all.


Doesn’t cover it all.


That’s why you need —


A supplement.


Which is a plan <Inaudible>


Plan F, that goes Plan A, B, C, D, then you have Plan F and N, you have Select Plan F, and you know.  So it gets confusing.  But the Cadillac plan out there is Plan F.  That covers virtually all of your medical expenses.  Now, to confuse folks a little bit more, that does not cover prescriptions.  So that’s where Part D kicks in, and that’s going to cost you <Inaudible> it is.  And to purchase that though, it comes again at the premium.  You’ll pay anywhere on the low side $15, probably all the way up to $80 a month.  So it can get expensive.


So the easiest way to remember that is when you say Part-something, that’s the government plan.  When it’s plan-something, that’s an insurance company plan that you use to supplement the government plan.


<Inaudible> Is there a better way to say it?  Oh okay, alright.


Well, we have Part C of Medicare which is really you’re getting out of the original Medicare which is A and B, and your care is then provided by an outside insurance company.  So those are also called Medicare advantage plans.  So I don’t really think of those as a government plan, even though the government is involved, the government might say to somebody living in Orange County we’ll pay you $9,000 and you take care of Joe Burt’s care from now on.  And if you pay out less than $9,000, well you make some money.  But if Joe costs you more than $9,000, well I’m sorry, that’s your loss.  And so the insurance company obviously is going to manage your care.  So they’re looking to have a closed network — some of them.  Some of them have open networks where you can go in and out of network.  But you’re going to pay money when you go to doctors and hospitals, you’re going to have exposure that would otherwise be covered by paying a monthly premium for the supplement.  And that exposure can be high, it can be 7,000 in network, maybe 15,000, 20,000 out of network.


So the good news is you will cover all of that and more at your workshop <Inaudible> that’s going to be on Tuesday, July the 11th at our office in Altemont Springs from 6:00 to 8:00.  You’re going to provide some light refreshments.




And we have a nice classroom there, we can get about 25 or 30 people in comfortably.  And you’ve got some big screen television there and all kinds of audio visual stuff, you’ll be razzling and dazzling them.


There you go.


So if you want some more information about that, go to our website, that’s financialgroup.com, financialgroup.com.  Click on workshops, you can make a reservation. Right there in addition to the one that Gary is doing the week before on June the 6th, also a Tuesday — no it’s not, I’m sorry.  The month <?> before.  June the 6th, and that’s the What You Need To Do Now To Prepare For Retirement, get an idea of your number.


Okay, we got a call.  Perfect.  Well I was going to say if you have a question for Gary, 844-220-0965.  That’s 844-220-0965.  Let’s get to our first caller today, Chris in Orlando.  Chris, go ahead.  You’re on with the Certified Financial Group here on WDBO.


Good morning, Chris.


Hey, good morning, guys.


Good morning.


The one thing — I’m 30 years of age and my main concern was basically for the future because I know that whole saying <?>, Social Security is going to be out of the picture by the time I get of age, but right now I’m working on my Series Six and some of the things I’ve learned is about annuities and Roths.  And I was wondering — your intake is — at a person of my age, what should be the best direction to try to secure some type of — I know I should have worked to start it on like 10 years or 20 years ago.  But at this point, at this moment, is a Roth and an annuity a good idea, or?


Well Chris, I don’t know about starting at age 10.  <Inaudible> that’s pretty good, if you can start then.  So Joe, what do you think about an annuity for somebody 30?  I don’t particularly like it.


No, and they’re oftentimes promoted by these free lunch and dinner seminars and they will tell you all of this wonderful stuff that their annuities will do.  There’s a place for annuities, but oftentimes they’re not the ones that are offered through these seminars.  What you want to do — and you said you’re studying for your Series Six?


Yes, sir.


Okay, for those who are listeners that might not be familiar with that, that’s a securities exam through the Financial Industry Regulatory Association for someone who’s studying offer mutual funds to the general public.  So you’re getting some good information there.  And what you ought to be looking at is when you talk about retirement, what you ought to be using is some form of retirement plan.  Are you employed now?




Go ahead.


I have a 401k in place already.


Okay, so that’s what you want, that’s what your number one target ought to be.  Maximizing your contribution to your 401k, Chris.  At your age, you can put $18,000 a year into a 401k on a pre-tax basis.  Okay?


Yeah so Roth, would you at least consider a Roth better than a 401k?


Well, so most 401k — I don’t know about most, but probably about half wouldn’t you say, Joe, 401ks offer both a Roth version and a regular version.  And my rule of thumb and a lot of financial planners differ on this.  But if you’re in a 10% or 15% bracket, consider a Roth.  You are giving up a current deduction, but that current deduction is not providing you a lot of benefit.  But clearly if you’re in the 25% bracket or higher, it’s my opinion that you should put away money on a pre-tax basis that actually allows you to put away more money, right?  If you’re putting away $10,000 into your 401k, it’s only costing you 7,500.  But again, if you were in a 10% bracket, you’re just getting started, it might be nice to have early in life some money accumulating toward a Roth bucket of money.  And it’s a little complicated, we go into this in the workshops.  But it does permit you later on to have a tax-free bucket of money to live on in addition to taxable — the 401k or the regular IRA bucket so that you can manage your tax brackets later on in retirement and possibly avoid having taxes on your Social Security if you have a large enough bucket on your Roth side.  Now Joe, you have some thoughts on that, too.


Well, I agree with you 100% that if you’re in a low tax bracket.  Particularly, somebody that’s young because you could use the Roth as kind of an emergency fund as well.  Because <Inaudible> withdraw your principal from it and not pay taxes on it.  And if you don’t withdraw it, it’ll continue to grow for you on a tax-free basis.  So using a Roth — but the question is okay are you going to use a pre-tax or an after-tax.  Pre-tax is you’re going to use a 401k or traditional IRA.  After-tax, you’ll use a Roth.  But then really the question is where you invest it.




So here you are at age 30.  The good news for you, you have a great asset.  You know what that asset is, Chris?






Yep, you got it baby.


Tim is a great asset.  It’s a great healer.  So what you want to do is be as aggressive as you can possibly be, go fully invested in the market and don’t look at it for 25 years.  I guarantee you, you’ll do far better than somebody that’s trying to put it in a CD today because they don’t want to lose any money.


That’s right.  And most annuities are going to earn somewhere in the — in today’s timeframe if you’re looking at fixed annuity or fixed indexed annuities you’ll probably get somewhere between 3% to 5% at best.  And we know even if you look at the worst 20-year period or actually even the worst 15-year period from 1992 to 2012, we had a return of — for the S&P 500 index of a positive 4.5%.  And that is if you had the worst timing, meaning you suffered a loss in the 49% decline and the Dotcom bust.  And you suffered a 57% decline in the financial recession.  So if you have the worst possible timing, the worst 15-year period during that 20-year timeframe, actually still provided you with a little bit better positive <Inaudible> percent return.




Which is probably better than what most of the annuities would be paying today.


Yes.  And, what you want to do as — do that through your 401k because you’d be able to what we call dollar cost average.




Which means that you’re adding to the account on a regular basis and the best thing for you is hope that the market goes down for the next 15, 20 years.


Well actually yes, I was going to say for the next 34 <?> years even until you retire.  Really, the idea of dollar cost averaging is getting — and just as it sounds, an averaging of your prices throughout retirement and obviously the best thing would to be able to buy more shares at lower prices.  So bear markets, especially for people in their 20s and 30s are terrific ways of accumulating more and more shares.  So don’t be afraid of them, actually we also try to say if we’re in a bear market, see if you can put some more money away because you’re buying low.


Does that help you, Chris?


That helped me a lot, thank you.


Okay, good luck to you, man.


<Inaudible> Alright, good luck with the exam.


Just like that Chris, it’s that simple.  844-220-0965.  844-220-0965. if you have a question for Joe Burt or Gary Abbely from the Certified Financial Group, we are planning tomorrow, today.  Now it’s time to get the three big things you need to know.


And welcome back to the On the Money here on News 965 WDBO.  We are taking your phone calls at 844-220-0965 with the Certified Financial Group.  Joe Burt, Gary Abbely here in the studio taking your phone calls and your texts as well, 21232 is the number to get that.  21232.  But again, if you have anything to do with getting to that golden finish, as I like to call retirement, 844-220-0965.  One of the great resources Certified Financial Group provides is what’s called This Week’s Must-Read.  And this week’s must-read, what you should know before collecting Social Security.


Well the important things are is that if you start collecting at 62 and you’re still working full-time, chances are you’re not going to get the benefit that you thought you were going to get because of the offset.  Where you get back $1 for every $2 that you earn over about $17,000 today.  And then of course if you wait until your full retirement age, you’ll get the full benefit available to you.  But if you wait to age 70 —


Excuse me while I choke to death, here.


You get about an 8% bump-up each year.


Yeah, an 8% guaranteed increase per year, and that’s a big deal depending on your situation, your health situation, your spouse’s situation.  It might makes sense to do that.  So those are the things that we look at when we do financial planning for our clients.  Do that analysis because the difference can mean several tens of thousands if not hundred thousand dollars of different in terms of in terms of ultimate benefit that you and your spouse might be able to attain.


Well that’s right.  And you know you think the market is at an all-time high, maybe this is a good time use some of that retirement account to live on and let those Social Security benefits grow and grow and grow.


Exactly.  In fact, we did a little case study and presented that again this week, Gary, about looking at where you are in retirement and what accounts to draw from.  And then depending on what your tax bracket is, you may want to start drawing from your retirement accounts when you’re in a 0% tax bracket.  And maybe convert that to Roth.


Well that’s right.  So we had met with somebody who was early 60s and we looked at his tax situation and realized well if we defer Social Security and we start using some of his after-tax money, basically money in a brokerage account to live on, that he would really be paying no taxes.  And this particular person was single and we could — with the standard deduction and personal exemptions, he could convert roughly 40,000 a year into a Roth IRA with very, very little taxes.  So sometimes it’s not a good idea to pay no taxes.  We want people to use that — the 0% bracket and the 10% bracket at a minimum and have a process where you convert your regular IRA to a Roth IRA, especially if we know your <Inaudible> is going to be a 25% or 28% or higher bracket later on in life.


Or the other opportunity is take some capital gains.


Well that’s right.  If you’re in the 0%, the 10%, or the 15% tax bracket, and let’s say you bought Apple at 100 and it’s 150, you could turn around and sell Apple.  Would secure that $50 gain and not pay any income taxes on it as long as it’s long-term, as long as you’re in the 15% bracket or lower, obviously check with your tax preparer first.  But that’s a great way to step up your basis in a stock.


Yep.  Well before we get to the latest news, weather, and traffic, what’s the number to reach the Certified Financial Group during the week?




Elizabeth and Ed, hang on the line.  You’re going to be first up when we come back from the latest news, weather, and traffic right here on News 965 WDBO.


Welcome back, and this is On the Money with the Certified Financial Group here on News 965 WDBO.  It’s ask the experts weekend, we are here to take your phone calls at 844-220-0965.  844-220-0965 with Joe Burt, Gary Abbely.  Joe, for anybody that joined us during the latest news, weather, and traffic, what can they call you about?


We’re here to answer those questions that you might have on your mind regarding your personal finances.  Whether <Inaudible> do now so you don’t look back 5 or 10 years from now and say gee, I wish I had known about that.  Or gee, I’m sorry I did that.  That’s we do as certified financial planners.  We charge a fee for our services.  We act as fiduciaries for our clients, which is a distinction between a broker and a fiduciary, there is a distinction.  You can go to our website and learn all about that.  That’s financialgroup.com.  When we work with our clients, we do it on a fee basis.  We’re not here to sell you something, what we do is sell advice.  On Saturday morning , we do it for free.  So if you have any questions regarding your personal finances, we’re here to take your calls.  And the good news for you, there’s still a couple of lines open, and that number:


844-220-0965.  844-220-0965.  We also have the text machine up and running as well, 21232.  Elizabeth down at Yeehaw <?> Junction has a question for the Certified Financial Group.  Elizabeth, go ahead.  You’re on WDBO.


Good morning Elizabeth.




Thanks for calling.


Good morning.


How can we help you?


Can you hear me okay?




We can hear you fine.


Okay, terrific.  So I’m driving to West Palm Beach from Wesley Chapel, Florida.  And I have a question, I also sell advice and in one aspect I get paid as an employee.  And in one aspect, I get paid as a independent contractor.  I have several different banks and I was told by a financial advisor to truncate the amount of bank accounts I have.  I separate my businesses by bank accounts, is that not advisable?


Well Elizabeth, I believe you should have separate accounts so you Can keep your business affairs separate from personal affairs.  If you’re ever audited, it’s a lot easier than having to explain oh, this one’s personal, this one’s business.  I would definitely keep those separated.


I think I understand —


Separate the accounts.


I think I understood you to say that you have an accountant — several accounts for the independent contractor business.  Let’s say you have five clients that you work with, you have an account set up for each one of them.  Is that what you —


No no, what I do is I sell advice about <Inaudible> services and I have a bank account for that.




I also am a business development coach for actually a radio station.  So, I have a separate bank account for that.  And then I have another independent business — concierge business, and I keep a separate account for that.  So, I’m buying to buy down my debt to raise my credit, so my initial question was whether or not I should be concerned — if I’m single with no dependents, should I be really concerned about buying my debt down for any other reason than just getting my credit score up?


Well, I guess I would ask — I don’t want you to tell us what your credit score is — but if your credit score is adequate where it’s at, then I don’t know that I would be paying down low interest debt.  I would continue to put away money for your retirement.  But if you had in the teens credit card debt, then I think I would be focused on that.


The credit card debt is in the 20s.  It’s greater than 25,000.


Oh, okay.


So, my credit score — I’m sorry, go ahead.


We’re talking about interest rate on the credit card.


Oh yes, they are in the teens because I had an accidental foreclosure that was just a complete debacle with Wells Fargo, but that was literally — my mortgage was on auto-pay for the last 12 years.  It went out of auto-pay because if you don’t have enough funds they go out three times and then take it out of auto payment.  And I never knew it was taken out of auto-payment until I got a notification that my house was under foreclosure.  I paid $6,000 in the bank.  I had no idea because —


Elizabeth, I think I would just focus on the debt right now.  If you’re in the teens, that would be the best thing to focus on and get the debt situation, debt equity situation improved and then I would focus on retirement.


Alright, Elizabeth, thanks so much for the phone call.  It’s 844-220-0965.  If you would like Elizabeth’s line.  Let’s go to Ed in St. Cloud.  Ed, you’re on with the Certified Financial Group on WDBO.


Good morning, Ed.


Good morning, how are you?


Great, how can we help you?




I heard one of your answers and a previous caller had mentioned that you could put $18,000 in your 401k tax free and that sparked a question for me.  I currently feed 10% of my income into a 401k, which is about $12,000 a year, and I also feed an IRA, the max, which is, I think, 5,000 a year.  Am I better off to stop feeding that IRA, which is post-tax money, and —


Yeah, Ed, I do think you are better off contributing the maximum to your 401k at that income level.  You are in most likely the 25%, 28% bracket.  So, I would be putting more than the 12,000 that you’re putting away into the 401k.  The max, just so that our viewers know, is 5,500 for an IRA.  It’s 6,500 though if you’re old like me.


Over the age of 50.


Over the age of 50.  So, but because you’re doing your contribution on an after tax basis to your IRA, you really should max your 401k out.  And then —


So, just leave that IRA alone or do I roll that over —


No, just leave it alone.


Leave it where it is.


Leave it where it is and just let it keep growing.


Is that person going to be interested in managing that if I’m not feeding it anymore?


Well, it depends.  It depends on who you’re working with.


We can’t speak for how they would treat that account.




But there’s no — there’s not necessarily a financial advantage to having it combined.  A lot of people think it will grow faster if I combine all my accounts into one account.  It will grow faster.


Right, yeah.


Which is not correct.






Alright Ed.  Well, thank you very much.


Thanks for your call, Ed.


Yeah, appreciate it.  If you want Ed’s line, it’s 844-220-0965.  That’s 844-220-0965.  Katie in Lake Mary.  Katie, you’re on with the Certified Financial Group on WDBO.


Hi Katie.


Good morning.  I appreciate your time.




Real quick question.  Good or bad, I’ll be 65 in December.  I am gainfully employed.  I am a social worker, I have no intention of retiring at this point of my life.  I’m wondering about Medicare.  Is there advantage to waiting until I decide to stop working? Should I sign up for it now? I know there’s Medicare A and B and if I wait on the B it will cost me more down the road.  I don’t know what to do.


Well Katie, I assume that you are covered by your employer’s group health plan.




Okay, so I would suggest to you because the Part B is expensive and there’s no reason for you to spend 125 a month when you don’t need to.  So, a lot of people feel that once they’re 65 they need to sign up for Part B so that they don’t face some penalty later.  But the rule is this; you have a guaranteed issue right to purchase any Medicare supplement sold if you’re coming — I don’t care if you’re working to age 75.  If you’re coming directly off of a group health plan and you haven’t had a lapse of coverage.  And that’s an important distinction because one of the things that I ask in the workshop is Obamacare, the Affordable Care Act, got rid of pre-existing conditions, true or false.  And of course most people will say true, and it’s true for everybody 64 and under, but a lot of people don’t realize when you’re on Medicare you are subject to pre-existing conditions if you don’t buy a supplement when you’re first eligible.  Meaning, if you buy the part C plan, the Medicare advantage plan, and you later say ah, this isn’t working out for me, I don’t maybe like the network that I have, I think I’ll buy a supplement next year.  You get to the next year and you realize oops, I’ve got some medical questions I have to answer.  It’s not a guarantee that I can get back into original medicare.




So it’s important to buy what you want.  If you can afford the Cadillac, buy that initially.  Later on, if you can’t afford the Cadillac, you can go downstream in quality, if you will, but you can’t necessarily go upstream.  You can’t always go from an Advantage plan to a supplement.  There is —




Yeah, but in your case there’s no advantage for you really to sign up for part B Medicare.  I would wait until you stop working.




Doesn’t the — something in the back of my mind though, Gary, and you’re the expert in this, so that’s why I’m asking you.  The plan that she’s in has to be a qualified plan.


It has to be creditable coverage.


Creditable coverage.


And I’m assuming that you’re working for the government, Katie?




Yeah, so it’s going to be creditable coverage.  Now, what Joe was referring to, and this is a good point, let’s say that you were offered a couple different plans at your office and one of those was a high deductible plan.  Also known as a health savings account compatible medical plan.


Yes, understand.  Understand.


Well, those aren’t always deemed creditable coverage and so you potentially could be on that type of a plan and have a penalty when you sign up for Part D Medicare because you didn’t have creditable coverage for prescriptions for example because you had to first meet this large deductible.




So, you do want to stick with a traditional plan when you’re close to signing up for part B, so that’s a great distinction Joe, thank you.


Okay.  May I ask another quick question?




Regarding Social Security, do I wait until I retire? I’ve heard rumors from different coworkers that are in my age bracket, some of them are taking out Social Security now because they’re claiming that when they go to sign up at Social Security, Social Security is telling them it really doesn’t matter, you’re not going to really gain that much from waiting, so might as well get the “free money” now.


No, I disagree.  Disagree completely.  I would say, Katie, if you do not need the additional money that Social Security would currently provide, defer it.  You will be gaining an 8% approximate benefit for each year you continue to work and sometimes it’s even greater.  And the reason for that is when you work past your full retirement age, what Social Security does is they average your 35 highest years of earnings.  And let’s say by chance you were a mom raising a family and you had a lot of zeroes in those working years, you might be able to eliminate some of the zeroes with some high working years from the ages of say 67 to 70.  So, I don’t think that advice that you’re getting from your coworkers is good advice.




The only caveat there is if your health is poor.


No, not by the grace of God.  No.  Nope.


Well, if you’re in reasonably good health and expect to live 15 years, 20 years into retirement, you are better off getting a guaranteed 8% increase.




That’s right.  And your friends who are still working will be paying back a good bit of that Social Security because their benefits are going to be taxable because they’re currently working.


Oh.  I’ll bet they’re going to have a surprise next year.


Well, they need <Inaudible> for those who do take their Social Security, it’s really important to have some federal withholding for those benefits because they will be taxable in most cases.


Okay.  I really appreciate — thanks for being there for me.




I appreciate it.


You’re welcome, Katie.  Bye, we’re here for you.  Thanks for calling.


Thank you, bye.


If you’d like Katie’s line, it’s 844-220-0965.  844-220-0965.  Real quick, let’s see if we can’t squeeze in Anna before we’ve got to get to the three big things you need to know.  Anna go ahead.  You’re on with WDBO.




Hi, good morning.


Good morning, how are you?




How are you?


Good.  Um, my question is, my husband and I are in our 50s.  We’re self-employed.  We make pretty decent money right now and the only investment that we really have made at this time is property.  We have bought some property.  And I would like to know what else could we add to our portfolio to plan for our retirement?


Well Anna, you certainly, being self-employed, could set up a retirement plan.  For example, a SIMPLE one or you could do a SIMPLE IRA, a SEP-IRA, what’s called a simplified employee pension.


Muni 401k.


Yeah, yeah.  So, there’s a lot of different retirement plans you could set up to defer some of that income.  And while having property — rental property that you can control and manage on your own is, in my opinion, one of the great investments, you don’t want to just have that.  I  mean, anything with a retirement plan should have diversification.  So, you do want to have equities.  You likely want to have some fixed income and possibly if you have excess money, saving the taxes I think would be a great opportunity for you.  So, I would open up one of those three plans that we recommended and depending on how much you want to put away —


Have you filed your taxes yet for 2016, or are you on extension.


Unfortunately, we got an extension from our accountant.


There’s nothing wrong with that.  We do it all the time.  The good news for you is that you can still set up a SEP-IRA for 2016 and get some nice tax deductions.  So, ask your tax preparer about what you can put into a SEP-IRA for 2016 and get a tax deduction even though the tax year is closed, it’s one of the few options that’s still available.


That’s right.


Oh, okay great.  Well, thank you so much.  I’ll look into that.  Thank you so much.


Okay, thanks for the call.


Alright Anna, thank you so much, if you would like Anna’s line it’s 844-220-0965.  844-220-0965.  We are planning tomorrow —


Today —


With the Certified Financial Group here on WDBO.  Hey, welcome back, it’s the final segment of On the Money here with the Certified Financial Group on WDBO’s Ask the Expert weekend.  Got five minutes to the latest news, weather and traffic with Dave Wall in the News 96.5 news room.  Dave’s keeping an eye on that forest fire we have in Wachiva Springs State Park, get some updates on the traffic, and how hot will it get later today.  All coming up in four minutes right here on News 96.5 WDBO.  But, it is the last segment, the final chance to get your question answered from Joe Burt and Gary Abley from the Certified Financial Group, 844-220-0965.  844-220-0965.  The text machine is up and running as well, 21232.  We did have a text question here for you guys.  Let’s see.  Hi, explain if buying an annuity is a good plan for a senior citizen as an investing tool.






It all depends on the kind of annuity.  It comes in many, many different shapes and sizes, and unfortunately the ones that, as we said earlier, that are generally offered through these free lunch and dinner seminars are the ones that are loaded with things that you don’t quite understand and that you can never get out of them, and they’re very, very expensive.  If you want some information on — and those are what we call fixed index annuities, they’re popular because they say you can go in the market, you’re not going to lose any.  Market goes up, you gain; market goes down, you don’t lose anything.  Go to our website, click on the Info To Know tab, Info to Know, and then click on the other tab called The Rest of the Story.  And there’s some articles in there about these kinds of annuities.  What we oftentimes find is people buy them, think they’re buying a filet and they’re really buying hamburger.  They think they’re going to participate in the market, 100% goes up, I’ll lock that in, it goes down and I don’t lose anything.  But, at the end of the day when it’s all said and done, you really have hamburger when you thought you were buying a filet.  You’re not going to die from it, but it’s not going to get you what you thought you were going to get.


Yes, and now the flip side as an alternative to a bank account that might be paying 1% and the annuity might pay 3% to 4%, well of course that’s a better alternative provided you can handle the lack of liquidity.  Because, most of these you can only take out between 7% to 10% of the balance per year without a surrender charge.  And every company is different.  You’ve got to read the fine print.  There’s some good ones and there’s some not so good ones.  So, really look carefully.


Yeah, it’s a minefield out there and these kids of programs are oftentimes sold by people that this is the only solution that they have.  It’s like going to the Toyota Dealership and you really want to buy a Ford.  Well, all they can sell you is a Toyota, but you really need a Ford.  So, you have to be very, very careful about that.


Well, we’ve got about a minute and a half left of the show for the day.  Gary, real briefly, just tell us again about your upcoming workshops.  You’ve got one on June 6th and July 11th.


So, the one on June 6th is When Can You Retire: Know You Numbers.  So, we help calculate just what you’re going to need before you quit your job.  And we want you to be at least 90% confident that you won’t outlive your money.  So, we help you with the calculations there.  We have — the next one is healthcare options in retirement and when we mean healthcare, we mean not only Medicare, Medicaid.  We also are talking about long-term care and what those options are in retirement as well.  That’s July 11th.  And shortly thereafter, July 20th, we have Social Security Boot Camp and that is hosted by Nancy Hecht and Denise Kobach.


So, once again these are all held in our office in Altamonte Springs just off of Douglas Avenue just south of 434.  We hold them in our classrooms.  We can accommodate about 25, 30 people comfortably.  We always serve some light refreshments, give you some good information, and they are absolutely free.  People say well why do you do this kind of stuff, Joe? We do it for two reasons.  Number one, to give you information that will keep you from becoming a casualty in your retirement years.  And secondly to introduce you to what we do as a firm.  So, whether you need financial planning now or sometime in the future, perhaps you give us an opportunity to earn your business.  So, if you want more information, go to our website, financialgroup.com.  We want to thank all the Veterans for the service they provided.


And God bless America.


Well, happy Memorial Day, Gentlemen.  Have a great, restful weekend.  Back to work on Tuesday and


Dictation made on 6/1/2017 11:19 AM EDT.