Never buy life insurance on a child. True or false

Speaker 1:
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.
Stay tuned for On The Money, Central Florida’s most listened to financial call and show brought to you by Certified Financial Group in Altamonte Springs. It’s the only show hosted exclusively by Certified Financial Planner professionals. Monday through Friday their CFPs provide financial planning and investment advice for a fee. But on Saturdays, the advice is absolutely free and has been for more than 30 years for their WDBO listeners. If you have a financial question you want answered by real fiduciaries, the lines are wide open. Call 84-4580 WDBO, that’s 84-4580 WDBO and enjoy the show.

Speaker 2:
Welcome to On The Money right here on WDBO 1073FM, AM 580, always streaming live in that WDBO app. My name’s Josh McCarthy, so fortunate to be joining you today for this edition of On The Money. Joined today by Wynn Smith and Joe Bert, a couple of certified financial planners with the Certified Financial Group office in Central Florida. This is your chance, your opportunity to pick the brains of a couple of experts planning your financial future. All you got to do is pick up the phone right now, dial 844-580-9326, 84-4580 WDBO. Joe and the team have been doing this exact thing, providing answers, providing a sense of security, providing a peace of mind for the listeners of WDBO for On The Money Show. All you got to do is call 84-4580 WDBO, ask them your questions.
Maybe you heard something in the news, you want to know how exactly that plays in your scenario. This is your time to join the conversation and be a part of it. We can’t do without you. It’s the only financial call in show of its kind. So this is your chance to utilize us. Utilize Joe Bert, Wynn Smith, the Certified Financial Group. They are experts in this field. Joe, Wynn, how are you guys doing today?

Speaker 3:
We’re doing great, Josh, how are you doing?

Speaker 2:
I’m doing just fine.

Speaker 3:
We’ve had a couple of questions over the last couple of weeks about what is that intro music we’re now using, that’s Gerry Rafferty and Baker Street. If you want to pick that up on your Spotify or Pandora and like to listen to it. It’s a great song. It gets me fired up in the morning. I’m glad we’ve got it going for us. But anyway, Wynn and I are here this morning to talk about anything that might be on your mind regarding your personal finances as we have been for more than 30 years. We’re here to take questions that you might have regarding your questions on long-term healthcare, regarding your IRA or 401K, mutual funds, ETFs, life insurance, reverse mortgages, all those things that you consider, may be considering, you’re looking at, heard about, so on and so forth.
Our job as certified financial planners has been… For now the roots of our company go back almost 50 years I figured the other day, to help you get to and through your retirement years. That’s what we do Monday through Friday. We work with our clients as fiduciaries, doing financial planning and investment advice. But on a Saturday morning we are here for you absolutely free. So if you have any questions, things that might be on your mind, stuff you want to know, things you might’ve heard from your neighbor, from your brother-in-law, from your coworker, somewhat confused, we’re here to clean up the mind fog. And the good news for you, the lines are absolutely wide open. You could be first in line by picking up the phone and dialing these magic numbers.

Speaker 2:
844-580-9326, 84-4580 WDBO, or you can send in your question via the free open mic inside the WDBO app. Go ahead and put your questions in. Send them in, I’ll chop them up for you. I was going to say cut and chop, a couple of radios [inaudible 00:04:48] I said cop, we’ll chop those up for you and then I’ll toss them over to the experts, Wynn and Joe. The topic for today’s show is, Never Buy Life Insurance on a Child. Is that true or false?

Speaker 3:
All right, Wynn, what do you think buddy?

Speaker 4:
Well, Joe, one of our colleagues approached me last week and asked my opinion on life insurance. And of course we had a discussion and life insurance for a child specifically, and it was a case that she was working on. And it got me thinking about being the cohost today and what topic I was going to speak on. And I think this is a very not well understood topic because there is a very famous financial entertainer out there that is adamant about never buy life insurance on a child. And there are some good reasons and bad reasons. It goes back to you’ll hear people say never buy a particular financial service product or never do a particular strategy. And that’s not really good advice because there are no bad products or strategies, there’re just bad applications.

Speaker 3:
Right, misuse.

Speaker 4:
Misuse. So it can be… In fact life insurance it depends on what you’re trying to accomplish would be the first thing. So a lot of people are always looking to give their children a leg up. Typically, the first thing that comes to mind is education planning. And we’ve got a workshop coming up on college-

Speaker 3:
September 6th.

Speaker 4:
September 6th, college planning for high school students, what parents should know by Charles Curry. And so I thought this would tie into that because this also figures into that, there are some advantages of life insurance in terms of education planning. Life insurance is another tool. In fact, it’s sometimes talked about as a trick of the wealthy life, buying life insurance on a child. And then the other thing that… So the three tools that you typically have when you’re giving a child a leg up would be like some type of college planning, a 529, a Coverdell, Florida prepaid.
Another opportunity you have is an UGMA or UTMA account, a Uniform Gift to Minors Transfer or Uniform Gift to Minors Act. And those are ways to hold assets in an account and transfer those to minors once they become of age. And then the third thing is life insurance. So a lot of wealthy people buy life insurance on children as a way to transfer assets or to build wealth for their children, but life insurance enjoys some unique characteristics. So one of those is that you’re never going to get a cheaper cost of insurance than you are as a child. So that is the least expensive form of life insurance to have. And what we’re typically talking about when we put life insurance on a child is we’re typically talking about a permanent policy, a participating policy with a mutual insurance company and typically a limited pay because the goal is to put as much money in the policy as you can, as quickly as you can.
Now, the advantage that life insurance has over say college planning, a 529 or maybe an UGMA or UTMA account, first of all with the 529 is that the cash value, the living benefit inside the life insurance doesn’t count against you for financial aid. So you could build money inside a life insurance policy that you could access at any time to use for college planning or anything like that. But it also is not going to hurt you on your college aid application. So that’s kind of a way to go there. So the flexibility inside there, inside the cash value of the life insurance is unlimited. The other thing, the advantage it has over the UGMA or the UTMA is that unlike those accounts which transfers to the minor when they become of age, I think the UGMA the maximum age is 18. I think the UTMA you can go up to 25.
The owner of the policy retains ownership of the policy, so you don’t lose control over the policy and the cash value inside the policy. So that element of control is there. The other advantage you have with the life insurance is that the cash value inside the policy is growing tax deferred, possibly tax-free that you would enjoy in the UGMA or UTMA, of course the 529, the Coverdell, those type of products those are growing tax deferred, tax-free if you use them for education expenses. So those are kind of similar. And then the other thing is that in many states, cash value inside of a life insurance policy enjoys creditor protection. Now you would have that with your education accounts also, but having a creditor protected, tax deferred, possible tax-free asset that you could pass on to your child whenever you deemed that you would like to do that, that is a huge advantage in terms of giving your child a leg up.

Speaker 3:
I think when looking at the opportunity or the different options that you might have, I would start billing the base on probably the Florida Prepaid Plan. This way you can lock in those costs, you know exactly what you’re getting, what you’re buying and what that’s going to be. And then maybe on top of that layer, the 529 to cover up some extra costs. And then if you’re so fortunate enough to be wealthy enough to really be concerned about maybe transferring assets, then I would layer the insurance on top of that. But I think your foundation needs to be being sure that… And you mentioned the pros and cons of each of those UTMA accounts and the 529 plans and so forth, and being able to qualify for financial aid. But once again, really I would think that the life insurance option is really for the very wealthy that are concerned about creditor protection and want to transfer some assets perhaps to their child. I agree with you 100% on locking in a cost perhaps for a child in their later years. That’s always an option.
But unfortunately I think many people don’t have the luxury of having that extra cash to be able to put it aside. So if you’re looking to stretch your dollars as Charles is going to cover in his workshop on September 6th here in our offices on Wednesday evening at six 30, we’ll talk about some of those options and I think you’ll see that the things you just talked about are an option, but probably not the primary way that you want to fund your college education.

Speaker 4:
Correct. And then also we’ve got another workshop coming up, Savvy Generational Planning, Why Estate Planning, Why Now by Matt Murphy on September the 19th from 10:00 to 11:30 AM. And again, putting money in an UGMA or UTMA one of the benefits of those type of vehicles is the unlimited nature. You can put as much as you want. Now, the UTMA you can put anything, in the UGMA you’re limited to securities and cash. And you can’t buy as much life insurance as you want. That’s a misconception. And you can’t buy as much life insurance on your child. So you’re absolutely right, a middle class person, upper middle class person, first of all needs to make sure that they’re protected. And in fact, most insurance companies will not sell a policy on a child or it’ll be a percentage of what coverage that the parent carries so that you can’t overinsure a child.
You can’t have more life insurance on your child than you can yourself.

Speaker 3:
Right, yeah. Sends up a lot of red flags.

Speaker 4:
Yes, it does.

Speaker 3:
Get a big policy on your kid and nothing on yourself that just doesn’t smell right.

Speaker 4:
Yep, and then all of a sudden you leave them in the car.

Speaker 3:
Yeah. Geez, don’t even… Oh that’s a horrible thought.

Speaker 4:
Sorry.

Speaker 3:
That’s all right.

Speaker 4:
But there have been cases.

Speaker 3:
Unfortunately. Yeah, that’s the way the world works.

Speaker 4:
And another thing, Joe, is that insurability, you’re locking an insurability for the child.

Speaker 3:
That’s true. But statistically that’s not usually a bigger thing. So anyway, those are some of the options that you might consider. I hate to see life insurance sold for the wrong reasons at the wrong times. But anyway, this is why we’re here to kind of clear up the mind fog on all the options that are out there. And I hear we’re up against the break, Josh, so will take it away.

Speaker 2:
That’s right. If you want to hop on the air, you heard something that has been crossing your mind or maybe Joe or Wynn said something that reminded you about a question a family member asked you and how it could affect you, now is your time to ask Joe Berd and Wynnn Smith, the Certified Financial Group directly. Call 84-4580-9326, 84-4580 WDBO or you can visit the WDBO app and send in your free open mic. You are listening to On The Money or Planning Tomorrow

Speaker 4:
Today.

Speaker 2:
With the Certified Financial Group. Welcome back to On The Money right here on WDBO 1073FM, WDBO app always streaming live. Take us with you on the go inside that WDBO app and AM 580, plenty of ways to listen to WDBO. This is on the money, your chance to hop on the air and get the financial experts of the team at Certified Financial Groups. So fortunate to be joined by Joe Bert and Wynn Smith, a couple of certified financial planners. The number to call is 84-4580-9326, 844-580 WDBO. And I got a question that just rolled in during that break. Is it okay if I ask you guys?

Speaker 3:
Let’s do it.

Speaker 2:
All right, this one comes to us from Josh and it looks like he is at the WDBO control room.

Speaker 3:
Oh, got it. Name wouldn’t be McCarthy, would it?

Speaker 2:
No comment. No comment. I don’t want to give away too many specifics.

Speaker 3:
I got it.

Speaker 2:
All right. So actually yeah, you talked about the 529 for financial building or for building the finances of your kids in the future and that we know is the educational benefit. But the reason my wife and I chose not to do that is just because it’s hard to guarantee if your kids are going to go to a higher education or if they want to get straight into the workforce. And we were nervous worst case scenario, we spend 18 years building that account and then they choose to, who knows what, just go straight into a field of something else and not need it and then we just get that money back with no interest. But it appears that was a common concern and the government or the banks may have changed the way you can utilize those funds.

Speaker 3:
You are right there radio breath, let me tell you what you got going on here. Starting next year you’ll be able to convert tax and penalty free up to a lifetime limit of $35,000 that’s in 529 to a Roth IRA owned by the 529 beneficiary. So your child has the ability if that money is in that account under current law to transfer up to $35,000 subject to annual Roth IRA contributions though. So depending on what the Roth contributions, you can’t do it in a lump sum. And that’s going to take effect and starting in 2024 and there you go. So your point is well taken. If you’ve put that money in the 529 and it’s building up, building up, building up, and your son decides he wants to make money than he can make more money as a welder, than he can by doing something in French lit, you can take that money and for his benefit, her benefit, roll it into a Roth for their future use. So it’s not lost.

Speaker 2:
That’s wonderful. So something you did say is that it’s limited to current or whatever present day Roth IRA contributions.

Speaker 3:
Contributions.

Speaker 2:
Say you have $35,000 in there, if it was today you could only move over 6,500 a year.

Speaker 3:
That’s correct, yep.

Speaker 2:
So it’d take you a few years to move all that over.

Speaker 3:
Yes, it would.

Speaker 2:
Okay.

Speaker 3:
There you go.

Speaker 2:
That’s wonderful, so that’s great to hear.

Speaker 3:
Yep. And there’s a 15-year limitation on that that’s got to be done. You have to wait 15 years, in other words you can’t do it immediately.

Speaker 2:
So if your kid turns 17, you can’t utilize or can’t transfer those funds until they turn 32.

Speaker 3:
32, right.

Speaker 2:
Oh, wow. Okay, so you get started now then.

Speaker 3:
Yeah. Well, it really makes sense because you’re setting up that 529 for a child generally and you’re not going to allow them to do it when they’re 17 years old, unless you start it when they’re two years old. So there you go.

Speaker 2:
Thank you so much. Appreciate that.

Speaker 3:
Only on WDBO we’re doing that kind of stuff.

Speaker 2:
I love that.

Speaker 3:
There we are.

Speaker 2:
All right, thank you. Oh, go ahead.

Speaker 4:
Yeah, just to finish up the topic this morning, one of the beauties of Certified Financial Group and being fiduciaries is the fact that we are agnostic. We’re product agnostic. Like this morning we talked about Florida Prepaid, well, that has to do with the state of Florida. It has nothing to do with anything. 529s, life insurance, UGMAs, UTMA accounts, those are different types of accounts. There’s no product, the product doesn’t matter. What we help our clients do is to figure out strategies to achieve their goals. So it depends on what the goal is. So to finish this up, never buy life insurance on a child, that’s false. There could be a reason that you would want to do that depending upon what goal you are trying to establish. And if you’re talking to someone who’s a life insurance agent, they may say yes. If you’re talking to someone who’s not, they may say no. But if you’re talking to a certified financial planner, professional fiduciary, they can say what’s best.

Speaker 1:
Well said, Wynn.

Speaker 4:
Thank you.

Speaker 2:
Thank you so much Joe and Wynn, if you want to hop on the show, get your questions answered like I took advantage of every now and then, the number to call is 84-4580-9326, 844-580 WDBO or send in your question via the free open mic inside the WDBO app. You’re listening to On The Money, where we’re planning tomorrow,

Speaker 4:
Today.

Speaker 2:
With the Certified Financial Group.

Speaker 1:
Welcome back to On The Money, Central Florida’s most listened to financial call and show brought to you by Certified Financial Group in Altamonte Springs. It’s the only show hosted exclusively by certified financial planner professionals. Monday through Friday, they have CFPs who provide financial planning and investment advice for a fee. But on Saturdays, the advice is absolutely free and has been for more than 30 years for their WDBO listeners, if you have a financial question you want answered by real fiduciaries, the lines are wide open. Call 844-580 WDBO, that’s 844-580 WDBO and enjoy the rest of the show.

Speaker 2:
Welcome back to On The Money right here on WDBO 1073 FM, AM 580, always streaming live in that portable radio of yours, stream us live in the WDBO app. Take us with you wherever you go. Or if you find yourself in that app and want to ask the team of Certified Financial Group a question, go ahead and open up the open mic, send in your best question. I’ll play it back for them on the air live and we’ll answer it that way. Or if you want to do things the old-fashioned way, there’s always that old phone. If you have a rotary dial, you’re going to spin these numbers 84-4580-9326, 844-580 WDBO or send in again that open mic. Sitting with us today in studio, Wynn Smith and Joe Bert with the Certified Financial Group.

Speaker 3:
We’re talking about 529s here at the top of the hour and what you can and cannot do. And then we’re talking about converting an unused 529 account to a Roth for the beneficiary. But once again, the brain trust here in Certified Financial Group has come up with some more creative ideas, so take it away, Wynn.

Speaker 4:
Yeah, Josh, one of the things the 529 is unique about is that you can make yourself the beneficiary. So as the parent, you establish the account and the child’s the beneficiary. But if you’re concerned about the child not wanting to go to college or whatever, first of all the 529 could be used for trade school, it can be used for a lot of other different things. But you can make yourself the beneficiary and there is no age limit when those funds have to be used. And then as Joe and I were talking about, there’s a lot of flexibility in what qualifies as a withdrawal from a 529. And we were talking about there was a case where a couple went abroad and studied culinary arts. So if you’ve an institution that qualifies for financial aid, if they have a study abroad program or if they have an adult education, some type of resources there, you could use this to study whatever’s available to you. And plus there are also foreign schools that you could use 529 funds towards.

Speaker 3:
Yeah, there’s over 400 schools in foreign lands that you can use the 529 fund for. So Josh said it even gives you more flexibility. So once again, if your child does not use that money you can make yourself the beneficiary. And I don’t think the Regs have been written about you then being able to convert it to a Roth for yourself somewhere down the road if you want to do that. Or if you wanted to use it for education for yourself you can study abroad or go back to school or whatever it is you want to do. So there’s a lot of flexibility in that, and significantly Charles Curry will be covering that on September 6th, right here in our office for one hour, Wednesday evening at 6:30. He’ll be talking about 529s and all that and more.
Charles has firsthand experience because he just sent his first daughter off to college and he’s been through the wringer, so to speak. And has learned an awful lot that he wants to transfer on to you about what the true cost is and what financial aid’s all about and how to weave through those financial decisions that you have to make. So I’d encourage you, if you want to learn more about that cost for your child or grandchild, go to our website, that’s financialgroup.com. You can make your reservation right there. And to follow it up with that we’ve got another workshop, Wynn.

Speaker 4:
Yes, we do. Matt Murphy’s going to be having one on September the 19th, savvy generational planning, estate planning, why now, from 10:00 until 11:30 AM.

Speaker 3:
So that’s Savvy Estate Planning.

Speaker 4:
Savvy Estate Planning, and also Charles is standing by taking calls off the air.

Speaker 3:
Oh yeah, good point. Charles can take your calls if you have any more questions about his upcoming workshop on September the sixth, you could reach him right now at 407-869-9800, 407-869-9800 or 1-800-EXECUTED. If you’re executing a legal document, you’ll be glad to take your 529 questions or anything else that you may want to discuss with him about. Other than you want to pick up the phone here and talk to us here, I see we have a call there, Josh, so take it away.

Speaker 2:
That’s right. Let’s go to Sanford where JC is coming in. He’s got an employment change and he wants to know if you have any tips. Go ahead, JC, you’re on the air.

Speaker 3:
Hello, JC.

Speaker 5:
Hello, good morning. I’m going to be a state of Florida employee here in the next couple of months. And the question is less to do with what to do with my current retirement funds, but more so with what do I choose when I become a state employee because I think they offer the state pension and then also some type of other retirement package. Any experience in that field?

Speaker 3:
Oh, we’ve got a lot of experience. Here’s my rule of thumb, if you don’t plan on being a state employee for 20 to 30 years, I would do the traditional, it’s kind of like a 401K where you put your money in and you get a real nice contribution into your own account that once again you can take with you. The problem is you don’t really build up any momentum in the pension plan until you’ve been there for 20, 25 years to really get that benefit. And we probably know a lot of school teachers and firefighters and patrolmen that have been in the system for many years, they have very nice pension that’s because they stuck it out. But unfortunately, most people don’t last that long in the system. So if your plan is not to last that long, I would definitely do the contribution where you put some money in and the state makes a nice contribution for you as well. And then it’s portable, you can take that with you.

Speaker 2:
Yeah, and I can encourage JC… How old are you?

Speaker 5:
59. I plan on working through, I’ll be out another 10 years.

Speaker 3:
Okay. Yeah, it’s clear in your case I would not do the pension option.

Speaker 5:
Okay, great. Awesome.

Speaker 3:
All right JC, thank you for the call. And once again, you don’t want to leave that 401K languishing where you currently are. You want to maybe be sure it’s tied into what you’re doing and at that particular age, you’re a great candidate to do some financial planning. Look at what you need to do now so when you’re ready to retire, you’re all set to go. So once again, that’s what Wynn and I and the 14 other certified financial planners do day in and day out, working with our clients for a fee, designing a plan to get you to and through retirement. We encourage you to go to our website, that’s financialgroup.com. And I see we’ve got a text question floated in there, Josh.

Speaker 2:
Yeah. Sorry, I just heard off the air that JC said he’s going to give Rodney a call. I believe it’s Charles Curry standing by at the moment, but if you call during the week I guess you have a whole plethora, a team standing by ready to answer your question. Again, that number during the week is 407 -869-9800. Speaking of that text question, let’s go ahead and head to those now. This one comes to us from Debbie. She wants to know, should I convert some of my IRA to a Roth?

Speaker 3:
There you go.

Speaker 4:
Well, that’s a timely topic since we’re kind of touching on that. Well, Debbie, that’s kind of a broad question. It kind of depends. Just kind of like we were talking earlier about the pros and cons of life insurance on a child, there’s pros and cons in converting traditional IRA money to Roth money. It just kind of depends on where you are in your financial life. It depends on what your current taxes are. It depends on what you anticipate your future taxes to be. It depends upon what your legacy goals are. There’s a lot of variable factors there to really give a definitive answer for your situation. What I would recommend, this would be a situation where you may want to reach out to us and take advantage of talking to one of our CFP professionals here to get more specific information about your situation, to give you a more definitive answer. But it depends, sometimes it’s a good thing, sometimes it’s not such a smart thing to do.

Speaker 3:
Yeah, we have seen circumstances where people have rushed off to make that because their coworker or brother-in-law says, “Man, you got to put all your money in the Roth only to find out that they really messed up and probably should not have done it. So all this stuff is out there. It sounds like great ideas, the silver bullets going to cure all your ills. But if you go down the wrong path and press the trigger or pull the trigger at the wrong time, you can find yourself in quite a problem. And one of the things that you want to be aware of, particularly if you’re in retirement years and you start doing those conversions, it could impact the taxation of your social security and increase your Medicare premium. So those are the other things you want to look at and the timing in which to do it.
The beauty of the technology that we have today is we now have programs we can put in your specific information, plug in the exact numbers and show you the pros and cons of that decision. And that’s what we do day in and day out for our clients. We encourage you to look us up on the website @financialgroup.com if you’d like to get some more information. And I see we’ve got another question floated in there, Josh.

Speaker 2:
I apologize, I was talking to a talent here off the air, would you mind saying that again?

Speaker 4:
No, and I’ll just add one more point while Josh is looking for our next question. That is part of financial planning is because your biggest expense over your lifetime is taxes. So that Roth conversion can be a tremendous tax saving strategy or it cannot be. Another situation where I see where it’s inappropriate where people are starting to be worried about required minimum distributions and RMDs and they realize that, oh, I don’t have to have that with a Roth, but that’s not necessarily a bad thing either.

Speaker 3:
Right, exactly.

Speaker 4:
It just depends.

Speaker 3:
So what I said is I saw another text question float in, you want to take it away?

Speaker 2:
I gotcha. The second question, it says, what is the best age to take my social security?

Speaker 3:
There’s another.

Speaker 4:
It depends. Typically, you want to defer as long as you can because currently if you’re born after 1960, your normal retirement age would be 67. You get an 8% bump in your social security benefit if you wait until age 70, which is the maximum age. And then of course the beauty of social security is it’s indexed with inflation, so that benefit keeps going up. And then also it could come into play with any type of survivor planning for your spouse because you get the higher of the two. So it really depends. But let’s say you don’t have longevity in your family, you can take as early as 62. So you may want to do that or you may have to take it. There’s a lot of different situations that determines when’s the best age to do it. But again, going back to Joe’s earlier comment, I mean we have some fairly sophisticated software and that’s part of the analysis that we can do for our clients and part of that overall retirement planning.

Speaker 3:
Yeah, so you take a social security or defer the social security and begin some Roth conversions or take some money out of your retirement account. Those are all the things when you reach that gap when you’re in your 60s, you got a lot of decisions to make in terms of retirement planning and taxes are a big thing as you said. And that’s what financial planning is all about. There are so many opportunities out there and it could cost you tens of thousands of dollars if you’re not aware of them. So sit down with a certified financial planner. There’s many good ones in the Central Florida area. We happen to have 16 of them here at Certified Financial Group. We hope you’ll give us an opportunity to earn your business. Go to financialgroup.com and I see if we got another text question floating in there, Josh.

Speaker 2:
That one comes to us again from Rick. This one is, why is everyone talking? It’s always one. Well, I keep hearing about this. Tell me more. I got to go to the experts that I trust at Certified Financial Group. So why is everyone talking about the risk premium on stocks?

Speaker 4:
Well, the reason they’re talking about that is because interest rates have been going up and now I think we’re getting to the end of them going up. But the question now is how long are they going to stay up? And when you look at treasuries and the interest rates that they’re paying, that’s considered a risk-free type of place to put your money. The theory being that the federal government’s going to be the last thing standing on the face of the earth. So that’s probably a pretty good place to put the loan money to. So when you look at other investments, you typically compare that to what’s considered the risk-free rate of return? And right now treasuries are, I don’t know what? Four and a half, 5%. You can get some pretty decent returns. So when you’re looking at putting money in a mutual fund, an ETF or a stock or some other type of investment, those are considered riskier and most people want to be rewarded for that additional risk with a higher return.
So it goes into the factor of the valuation of those other types of securities and that risk return trade off that we talk about a lot on the money. And so that’s probably where that’s coming from. Joe, have you?

Speaker 3:
Yeah, you’re about right. But once again we want to remind our listeners that the younger you are, the more aggressive you want to be in your investing because time is a great healer. Even though those fixed income investments, treasury bills, even money market accounts today appear to be relatively attractive compared to recent interest rates, they’re not going to get you where you need to go, particularly if you have a horizon of 10, 20, 30 years. And even if you’re just about to retire, you can’t afford to stuff all your money in something with a fixed rate of return unless you’ve got a huge amount of money that you can draw from. So this is where financial planning comes in and this is what we do. And I hear the bumper music, so take it away, Josh.

Speaker 2:
You got it. Steve Perry is joining us today at the Certified Financial Group with the memory of one of the lead singers of Journey. 844-580-9326 is the number to call if you got one more question. If the question pops into your head or if it’s a little more personal, Charles Curry is standing by at the Office of Certified Financial Group. That number is 407-869-9800. You are listening to On The Money where we’re planning tomorrow,

Speaker 3:
Today.

Speaker 2:
With the Certified Financial Group. Welcome back to On The Money right here on WDBO 1073FM, AM 580, take WDBO with you on the go with that WDBO app. One more segment coming up, so the number to call in if you want to talk to them live on the air. The team at Certified Financial Group is 844-580-9326, but likely at this point we got another option for you standing by off the air. Charles Curry, one of the Certified Financial Planners. That number is 407-869-9800, 407- 869-9800. We spent the better part of an hour with Wynn Smith and Joe Berd going over all kinds of things. But there’s one common theme and that is you, you and your finances. And if you guys want to kind of get your foot wet, get a little baby report card on how your funds are doing, Certified Financial Group has an awesome tool to assist you with that.

Speaker 3:
Yeah, we’ve had a handful of score my funds inquiries in the last week or so. For our listeners that may be new to it, it’s an opportunity for you to really get a fiduciary score as we call it on the investments that you might have in a brokerage account, your IRA or 401 K, whatever it might be. Looking at mutual funds and ETFs, we’ll provide you a score ranked down 11 distinct criteria, everything from expenses to performance to how much risk the manager is taking, get those returns. It’s what we use here internally to score the quality of the investments that we provide to our clients. It’s absolutely free. So just go to score my funds.com, that’s score my funds.com. You pull up the pull downs or you pull up the screen. And if you don’t know the tickers of your funds or ETFs, there’s a pull down screen and you’ll provide that.
All you have to do is type in the fund name and you’re on your way and they’ll send you a report within 24 to 48 hours. If you want to follow up with us after that, you’re free to do that. There’s no obligation. Personally I’d give you an idea of what we do as Certified Financial Planners. So once again, that’s absolutely free. In the last minute or so here, Wynn, why don’t we touch on the workshops we have coming up?

Speaker 4:
Yeah, again, Charles Curry’s doing one on college planning for high school students on September the 6th from 6:30 to 7:30 PM. And then on September the 19th, we’ve got Matt Murphy doing Savvy Generational planning, why estate planning, why now?

Speaker 3:
This is critical because the tax laws are going to change in 2026 and the nice benefits that we’ve had passing on your estate to really tax-free for the vast majority of people can and may change radically in just a couple of years. So Matt’s going to touch on that as well. Once again, all of our workshops are absolutely free. We hold them in our state-of-the-Art Learning Center right here in Altamonte Springs. If you’d like more information like to make a reservation, simply go to our website, that’s financialgroup.com, click on events and you can make your reservation right there. And as I said, it’s absolutely free and we’d love to see you here. So take it away, Josh. I hear the buffer music. Everybody, all of our listeners, have a great weekend. Enjoy this weather and hopefully those storms stay out of state of Florida.

Speaker 2:
I agree. I can’t agree enough. Thank you so much, Joe and Wynn with the Certified Financial Group for doing what you guys do best. And that’s giving the listeners of WDBO a peace of mind or maybe a nudge in the right direction when it comes to their financial future. If you’re listening now and you’re like, “Oh, I missed my chance to call in.” “No, you did not miss your chance to call in.” We have Charles Curry standing by off the air in the office at the Certified Financial Group. His number is 407-869-9800, 407-869-9800. And if you want to just have a little inquiry throughout the week, that also happens to be their weekly daily office number too. So for the weekly service of just figuring out where to start, that’s what the Certified Financial Group does best. 407-869-9800. You’ve just listened to On The Money where we’re planning tomorrow,

Speaker 3:
Today.

Speaker 2:
With the Certified Financial Group.

 

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