What to know about (and how to plan for) the impending expiration of the Tax Cuts and Jobs Act (TCJA). TRANSCRIPT

(00:00):
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.

(00:34):
Stay tuned for on the Money Central Florida’s most listened to financial call and show brought to you by Certified Financial Group in Altamont 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 five 80 WDBO, that’s 8 4 4 5 80 WDBO and enjoy the show.

(01:23):
Hello and welcome to On the Money brought to you by the Certified Financial Group. For more than 30 years, the professionals at Certified Finance Group have been answering your questions. For listeners every week here on WDBO on the Money has become Central Florida’s most listened to Financial call-in program, and it’s the only call in program where all of the hosts are certified planner professionals. Joining us on the show today is Aaron Bur and job. How are you doing this morning, gentlemen.

(01:51):
Good morning, Casey. How are you?

(01:52):
I’m good. Can’t

(01:53):
Complain. Good to be with you. I was thinking about when I heard the intro there that our friend Bill Hamm does every Saturday morning introducing the show and you just said at Central Florida’s most listened to financial call show. The reality is we’re the only financial call in show. All the other programs are one hour infomercials and we are here live to help our listeners as we have been for more than 30 years, answering questions that might be on your mind. As I like to say, they don’t teach you this stuff in school. So we go through life trying some of this, trying some of that, and wake up at 55 years old and find out what we might have as a collection of financial accidents. So Aaron and I here this morning, as we have been for more than 30 years, as I said, taking calls, answering questions that you have regarding your personal finances, about your mutual funds, about an IRA 401k ETFs, stocks, bonds, real estate, long-term healthcare, insurance, annuities, all the things that Aaron and I and the 14 other certified financial planners help our clients with to get them to and through their retirement years working as fiduciaries, as certified financial planners working for a fee.

(02:49):
But on Saturday morning we are here for you absolutely free. Do you have any questions about any of those topics or anything else I didn’t mention or anything you’ve heard about? Any rumors you heard, any financial mind fog you may have. We are here to take your calls and the good news for you is that not only you can call in with these numbers that Casey’s about to give you, but you can also text in which is a new feature. So we encourage that very much and those numbers are Casey

(03:12):
8 4 4 5 8 0 9 3 2 6. Like Joe just said, you can call or text five eight zero nine three two six to make it simple for you. 8 4 4, the station five 80 double DBO, or you can leave an open mic by tapping the open bike feature in the double DB app. The topic for today’s show is what to know about and how to plan for it, the impending expiration of the Tax Cuts and Jobs Act.

(03:35):
A lot of people don’t know that there were ni.

(03:37):
Yeah, this is a very sad, sad,

(03:39):
Sad,

(03:40):
Sad. This is sad.

(03:41):
Sad.

(03:42):
Why is it sad?

(03:43):
It’s because tax laws may be changing.

(03:46):
Yeah. So our government loves to create tax laws and then also create set ’em up in such a way that they sunset, which means that they eventually end and basically they kick the can down the road and create problems for future sessions of Congress to then make decisions and put pressure on them to either extend those tax cuts or they automatically expire. And that is what happened with the Tax Cuts and Jobs Act of, I believe it was 2018 is when this was passed otherwise known as the Trump tax cuts. And this was signed into law and it did a bunch of stuff mainly at lower taxes, created a new thing called QBI, which was a qualified business. What was it I, it basically cut taxes for small businesses based off of their income. There were certain businesses that didn’t apply but created the QBI deduction for small businesses.

(04:41):
It raised the standard deduction for everybody. So you may notice if you look at your 10 40, you’ve been doing your taxes for the last couple of years, that maybe you can’t itemize your deductions anymore for your charitable contributions and all that other stuff. And that’s because of the fact that your standard deduction went way up, which means that you’re basically paying less taxes because the standard deduction so high. The other thing it did is it raised the limits on what did it do for estate tax purposes. So it more than doubled the estate tax deduction for when you pass away of what you may owe to the government in estate taxes and created bigger gifting. I mean it did a whole bunch of stuff and basically lower taxes for a huge swath of people across the United States. Well, the sad thing is, and the way I say that it makes me sad, is that these are all set to sunset in 2025, which means that 2025 is the last tax year that they go into or will be in effect before everything reverts back to how it was. And that would be for tax year 2026.

(05:42):
So let’s stop there. So 2025 is when they sunset, they’re gone. So the taxes that we’ll be filing in April of 2026, so we have two more years to 24, 25, actually three more years of filing under the old code. What we’re going to file this year was for 2023.

(05:58):
So you have tax year 24, 24 this year and 25 and

(06:01):
Then what? Three more years?

(06:02):
Two more years? Well,

(06:04):
Yeah, but with three more years of filing. Oh

(06:05):
Yeah, okay. Three more years of filing. Yeah, the taxes, you’re going to file three more tax returns

(06:10):
Under the old law. The

(06:10):
Tax return fil for 2026, which you’ll do in 2027 will be under the Sunset law

(06:16):
Right now the big assumption here is that we don’t what goes with Congress because of course we’ll have a new administration and we will have a new senators, a new congressman and we’ll see what happens.

(06:27):
So yeah, so basically they kicked the can down the road in 2020, in 2018 to the Congress that’s going to be in 2025 to hopefully extend or change some of these tax laws. So some things to think about is that if your tax rates are, and so there’s planning opportunities around all of this assuming these things happen. And that’s the hard part as planners because in our world there’s not a lot of certainty except for death and taxes. But the uncertainty is tough because people want to plan for the impending changes in these tax laws and it’s hard to plan for future tax laws because they can change at any time. It’s hard to

(07:06):
Plan tomorrow today,

(07:08):
Especially when regards to taxes, right? The big one is the estate tax because apparently there is issues or not issues, but they have allowed for an exemption if you’re gifting. So right now you can give away, I think it’s almost 26 million as a couple to beneficiaries or just given away. And that’s under the, so the gift tax and the estate tax are unified. So basically you can inherit or give away up to that amount and not pay any estate or gift taxes. And so apparently they’ve extended that so that if the laws do sunset that they’re not going to claw back the fact that you did that. So for instance, if you give away $26 million now, and I realize these are big numbers, but I’m just throwing this out there for people. If you gave away $26 million now and in 2026 the law reverts back to $6 million, which is what it’s going to be for an individual, they’re not going to call back the $20 million you shouldn’t have given away and go back and back tax you on that.

(08:07):
So that’s just some of the things that they’re talking about, ideas they’re throwing out there. There’s a lot of talk now about Roth conversions because of the fact that people are anticipating higher tax rates. If you’ve been a listener of the show, it’s hard to plan for Roth conversions because we think that eventually the government’s going to tax roths at some point. There’s a whole article Joe wrote about it several years back about the Roth of Wolf and sheep’s clothing. If you’re interested, we can send you a link to that. So again, a lot of unknowns. People want to make plans around these kind of things. And so basically you just got to know what you know and go out and try and plan around and think about what you think is actually going to happen. So if you have a planner that you’re working with, these may be some of the issues that you want to bring up, the standard deduction going back down, possibly the estate tax dropping back down. So if you have a smaller estate anywhere from six to 12 million, you’re going to now be affected versus the larger estates right now of 12 to 26 million are not affected. So these are all things that need to start being taken into consideration, whether you’re talking with your financial planner or you’re talking with your estate planning attorney and trying to make some decisions around the impending sunset of the tax cuts in job act.

(09:19):
The beauty of technology though is today with the software that we have, we can now plug in your current situation and then look at what happens if the tax laws change. That’s true. And then what we do for our clients is we give you the opportunity to do that at home. Once you become a client, then we give you access to the software and then you can do the what ifs. What if this happens, what if that happens? What should I be doing, my Roth conversions, what’s the impact of this and what’s the impact of that? Back in the day back long before you started this profession, young man, we have to do this stuff with a calculator and a spreadsheet. And it was a challenge because tax laws change and it changes everything, but thank God for technology today is that we can plug in these hypotheticals.

(10:02):
What if this happens? What if that happens? And then when the tax laws ultimately do take effect, bingo, we’re ready to go until the next go round. And this way you can plan and it’s the things that you don’t know that come back and bite you and you’re doing your tax return and you realize, oh my gosh, I didn’t get that tax deduction or I could have and should have done that. And you’re talking about the standard deduction of how it’s been raised and how people can’t, can no longer get their standard deduction. It’s one of the things you look at of how can we take advantage of the interest deductions we pay in the charitable contributions and the medical expenses and all that stuff, which many people can’t do because the standard deduction has been raised. However, if you do what we call bunching deductions, you can in some cases take those planning opportunities, planning opportunities.

(10:49):
Simply what you do is you say you give X number of dollars every year to your church, your synagogue, your favorite charity, whatever it might be, and you pay your property taxes and all those things that used to be deductible. Well, you pay them in one year and you double up and then the next year you have to pay your property taxes, but you don’t have to pay it that year. You can pay it early, you can pay it after January. So if you do the planning, oftentimes you find that you’ll be able to get some extra tax deductions and that’s what planning is all about. And that’s what we try to do and encourage for our clients here at Certified Financial Group. So a lot of people look at us that although we manage billions of dollars for clients over the United States, we are certified financial planners and as certified financial planners, we look at your personal situation a little bit differently than somebody who just wants to grab your money and manage it.

(11:34):
Managing the money is what gets you there, but you have to do it in light of your overall financial situation and one of the tax impacts of making those decisions, whether the tax impacts of doing that Roth conversion, how many people make that Roth conversion, they realize, oh my gosh, I’m in a different tax bracket. Oh my gosh, my Medicare, my social security is going to be taxed and my Medicare may be going up and all this other stuff. And this is where planning comes in. So you don’t want to go down the path unknowledgeable, and this is what we do with certified financial planners. If you want to know more about what Aaron and I and the 14 other certified financial planners do day in and day out working with our clients as fiduciaries for a fee, you can find out about us by going to our website, that’s financial group.com, financial group.com. You can learn all about us. We offer you no obligation visit. Come on up to our office here in Elmont Springs and we can tell you who we are, what we do, and you can see if you like us and frankly we see if we’re like you. That’s right. So that’s what it’s all about. And we got a workshop coming up, right, Aaron, what’s that about?

(12:27):
Yeah, so Charles Curry and I should mention Charles Curry because he actually is taking phone calls off the air. So if you’re interested in speaking with Charles and you don’t want to ask your question on the air, you can call into our office number at 7 8 6 9 9 8 0 0. Again, 4 0 7 8 6 9 9 8 0 0. Charles is taking calls off the air, but he’s also hosting a workshop in our office on long-term care on February 7th.

(12:49):
That’s Wednesday. Wednesday

(12:50):
Getting long-term care planning, right? A smart approach is for people at all stages. So February 7th from six 30 to eight 30 right here in our office. If you’re interested, you can go on our website, click on workshops, you can register right there and if you have questions about it, you can actually call and talk to Charles right now as well because like I said, he’s taking calls at our main office number 8 6 9 9 8 0 0.

(13:14):
Take it away Casey,

(13:15):
And you could be a part of the on the Money program this morning here on WDBL. Call on in right now, (844) 580-9326. You can call or text. We have a few texts already coming in 4 5 8 0 9 3 2 6. We’ll get to those in just a moment. You’re listening to On the Money where We’re Planning Tomorrow Today with the Certified Financial Group.

(13:41):
This hour was paid for by the host and does not reflect the opinion of WDBO.

(13:56):
Welcome back to On the Money, brought to you by the E certified Financial group for more than 30 years, the professionals at Certified Financial Group having answering questions for listeners every week on double DDBO. If you want to be a part of the program, call on in right now, five eight zero nine three two six. That’s (844) 580-9326. You can call or text those questions to 8 4 4 5 8 0 9 3 2 6 as well. I’m joined by Aaron Burt and Joe Burt this morning. And gentlemen, we have a question already coming in on our text line and here it goes. This person is single. They ask, do any different rules or tax consequences apply or occur if you name a person as a beneficiary on a 401k account who is not a relative,

(14:39):
No from income tax purposes, the donor, the owner of the IRA account or the 401k account, there’s no tax consequences. And basically the inheritor will get those funds and then they will have to pay taxes on them when those funds are withdrawn. Now depending on the age of the owner of the IRA and depending on the beneficiary when the money is with, let me back up, the money will be taxable when it’s withdrawn by the beneficiary, how it’s withdrawn or when it has to be withdrawn as a function of the owner’s age and the beneficiary’s age because the new rules where the account has to be drained within 10 years, unless the IRA or 401k owner has already started their withdrawals. So there’s rules, special rules that apply, but the tax consequences for the donor or owner of the account, there are none. So you’re making a nice little gift there and there’s no gift tax consequences. So that’s the way it works. Now that assumes now if the person doesn’t cash out the ira, if they cash out the ira, then it’s all taxable, a lump sum

(15:45):
And could be subject to penalties too, depending on how old they are, right,

(15:48):
Right. So that’s a scoop there Casey.

(15:51):
Alright, we got one more question here. This is from Jim and Oviedo. Jim says, I currently give weekly to my church, but my tax guy says I can’t deduct my contributions anymore. Is there anything I can do?

(16:03):
Well that gets back to what we said just before the break and he’s hundred percent right as Aaron said in their introduction, because they raised the standard deduction, many people are no longer able to itemize. So what you want to do is bunch your deductions, don’t give anything one year, double up the next year. Same thing with your property taxes. Don’t pay them the first part. As soon as you get those bills, usually in the fall, wait until maybe January depending on how much you’ve given and so on and so forth. But what you want to do is bunch of those deductions, the usual old time deductions that you had in one year and then you take ’em the next year or Oh yeah, go ahead.

(16:38):
If he’s over 70 and a half and he has a IRA, he has the potential to do what’s called a qualified charitable distribution. A qualified charitable distribution is where you take money out of your IRA or actually you give money directly from your IRA to the charity and those in the money that you take out does apply towards your required minimum distribution for the year. So it helps in that regard. And the withdrawal is not taxable, which means that basically you’re making a taxable withdrawal, which is a great way to do that if you’re giving money to charity. So instead of giving your weekly check or your monthly check or whatever it is that you’re doing, you can give one annual check out of your IRA to the church or any other charitable organization for that matter. And again, it accounts towards your required minimum distribution for the year.

(17:24):
And the withdrawal is considered tax free because it’s going directly to a charity. We process those. It seems like we’re doing several a day almost because clients have realized the benefit of actually giving money directly to charities out of their IRAs because of the fact that it’s a clean tax deduction for them. And again, it counts towards the required minimum distribution. So you’re killing two birds with one stone there. It’s a great way to do it. If you haven’t looked at doing that, speak to your planner or give us a call. We can help walk you through that process. Yep,

(17:56):
There’s good advice and thank you for the text and I work against a break there, so take it away, Casey.

(18:00):
Yep. You want to be a part of the program folks? Call on in eight four four five eight zero nine three two six eight four four five eight zero nine three two six. We have open lines. You can also text that number 5 8 0 9 3 2 6. Tap the open mic feature in the WDO app. Leave us an open mic question as well. You’re listening to On the Money where We’re planning tomorrow Today with the Certified Financial Group.

(18:35):
Welcome back to On the Money brought to you by the certified financial group. For more than 30 years, the professionals at Certified Financial Group have been answering questions for listeners every single week on double DDBL on the money has become Central Florida’s most listened to financial call-in program and it’s the only call in program where all of the hosts are certified planner professionals. Joining us on the show today is Aaron Bur and job and gentlemen. We do have some text questions coming in here to double DDBL. This one is from Jessica from Pine Hills. Her question is, I’m hearing from newsletters that Roth conversations are a good idea right now. Is that something I should consider? And what are the pros and cons?

(19:13):
Well, perhaps pros and cons. There’s a lot of pros and cons. Pros

(19:16):
And cons. So Roth Roth conversion is the idea that you are taking money out of a traditional IRA paying the taxes on those dollars and converting it into Roth. For those listeners who don’t know what a Roth is or haven’t listened to the show before or just aren’t aware, there’s two basic types of retirement plans that you can have. Traditional being that you put money into the account, you get a tax deduction today, the money grows tax deferred, and when you pull it out you pay taxes on the money that you withdraw at your current income tax rates. There’s a lot of conversation if you listen to the front half of the show about this because apparently tax rates are set to go up in 2026 because the Trump tax cuts are set to expire. If you didn’t hear that part of the show, you can listen to it on our podcast or on Facebook Live because we explained the whole thing on there.

(20:06):
So that’s the idea behind a traditional IRA put the money in, get a tax deduction comes out, you pay taxes on it. A Roth conversion or a Roth account is where you put the money in. You do not get a tax deduction today. The money grows tax deferred like a traditional IRA, but when you pull the money out, it comes out tax free under current law. And we always stress under current law because anytime that congress is in session, your money is in jeopardy. And we think at some point in the future that they may come after those Roth tax dollars that are all sitting there tax free and maybe means test Roth accounts or do something to make some of those dollars taxable. But under current law, if you pull those dollars out today, they come out tax free assuming that you meet the qualifications that you’ve held it for over five years and you’re over 59 and a half and so on and so forth.

(20:54):
So that’s the difference between traditional and Roth. Now a Roth conversion is kind of what it sounds like. You take money from an IRA traditional account and you convert it to Roth, which means that you pull the money out, pay taxes on it under your current tax rates and put it into a Roth account, which then starts that trigger in time for the five years and makes the money tax free On the withdrawal side, the idea behind and why this is gaining steam is because of, like I said earlier, with tax rates apparently set to go up, people are saying, well maybe I should pay taxes now on these IRA dollars and turn it into a tax free pot of money for the future. A reasonable idea and thought. But really it depends on what your current tax bracket is when you do the conversion, right? I mean that’s really what it’ll

(21:39):
And what your tax bracket will be in the future. But who knows what that will

(21:42):
Be? Well that’s the problem, right? That’s the choice. You just don’t know. And so part of what we do is try to guess and speculate, but really you can’t do it. All you can do is assume that at some point in the future you’re going to owe taxes and the tax rates could be higher, they could be lower, you just really don’t know. But if you’re in a low enough tax bracket, Roth conversions do make sense. And we deal with a lot of clients who are approaching retirement or starting retirement and a lot of times we encourage them to build up a cash buffer as they go into retirement so that they have money set aside to live off of that’s in cash or some sort of very liquid account. And so basically they have really low taxes their first couple of years in retirement before they hit social security age or maybe even their required minimum distribution age.

(22:29):
And that creates for us what we call a tax canyon and I only call it that because when we look at our software, we see their current taxes and then we see this huge area or this period of time where they basically have no taxes and then their taxes jump back up when they start required minimum distributions. And so the Tax Canyon is an opportunity for us to go in and fill in part of that canyon by paying some taxes today or very little taxes today by converting some of those traditional dollars into Roth accounts, pay basically little or no taxes and create tax-free undercurrent login accounts for the future. So that’s part of the planning that we do when we meet with clients, when we talk about doing Roth conversions because it’s something that sounds great, but there’s a lot of implications that go into it when you start realizing more income, other things become taxable, Medicare becomes more, your Medicare premiums could go up, social security could go up, other benefits you have may go down a lot of things that you need to consider when you start realizing more income.

(23:26):
And the other thing that I think very few people realize in order for the math to work, in other words, to get yourself in a better end result is that if you do that conversion and you don’t convert the entire amount back into the Roth, in other words you take the money out of the taxable account and you pay the taxes and you’ve given up a 10,000, 20,000, 40,000 whatever it is in taxes and you put the remainder into the Roth, you’re never going to catch up. You’re never going to be in as good a shape as if you’d left it there. So the key is is you’ve got to be able to pay the taxes with other funds or an equivalent amount to be able and convert that entire pre-tax amount into the Roth account

(24:09):
Or like I said, pay no taxes. So if you can do it and not owe any taxes, then that’s the best case scenario. So yeah, if you go backwards and you have a bigger hurdle to get over in order to make it make sense, yeah,

(24:22):
So if you’re giving up 22% right off the top, just to use raw numbers here and forgetting your overall income, let’s say you’re going to convert a hundred thousand dollars and 22% of it, you’re going to lose in taxes. So now your account is worth $78,000. Well how long does it take for your money to grow to recover just that $22,000 that you gave up in taxes? So you’ve got to be able to convert that entire amount into the Roth that most people, most planners even frankly aren’t familiar with that.

(24:51):
Well, they don’t think about doing it or it’s not. I mean if you’re in a low enough tax bracket right now at 10% tax bracket, maybe it makes sense, 12% tax or 0% tax bracket you

(25:02):
And that’s where planning comes in. Planning

(25:03):
Comes in and that tax can’t get in.

(25:05):
Realize without question today without so, and one thing we want to talk about, in fact, I was sitting at my desk this morning before we went on the air and I saw somebody had submitted a score, my funds request, and for our listeners that may not have heard of this, it’s a service that we provide for our WDBO listeners to allow you to send to us the tickers, the funds that you have in your IRA or 401k or brokerage account, whether they’re mutual funds or ETFs, not stocks, not individual stocks, but mutual funds or ETFs. And you send that to us and we will send you a score that’s a created by the Center for Fiduciary Studies. It’s totally objective. It looks at your investments on 11 distinct criteria, everything from how long the manager’s been there, what the expenses are, how much return you’re getting for the risk that the manager is taking.

(25:47):
And it’s what we use to determine whether or not the investments that our clients are using are suitable for their time horizon, their risk strategy. So if you want more information about that, if you want to participate, just go to score my funds.com, that’s score my funds.com. You’ll go to the website and you’ll pull up a pull down menu and if you don’t know the ticker symbol you put in the fund name, it’ll give you the ticker, send that to us within 48 hours you get a report totally tax free and if you’d like to follow up, we’d be glad to do that for you as well. So that’s score my funds.com. And once again, man, you mentioned a workshop we have coming up this Wednesday. Well, we

(26:23):
Have all sorts of workshops on our schedule, so if you’re interested in finding out about those, I’ll run down the list here real quick, but you learn about those by going to our website, financial group.com, clicking on workshops up at the top. The one that’s coming up the soonest is actually by Charles Curry and Win Smith is actually hosting that one as well. It’s February 7th in our office, six 30 to eight 30.

(26:44):
That’s

(26:44):
Wednesday. That’s Wednesday, six 30 to eight 30 in the evening. Charles is also, I should mention that he’s taking calls off the air, so if you don’t want to call in and ask your question on air, he is taking calls. You’d call our office number four oh seven eight six nine nine eight zero. Again, 4 0 7 8 6 9 9 8 in Charles Curry, certified Financial Planner is taking calls right now off air. So again, Charles and Wynn are hosting that workshop February 7th. It’s getting long-term care planning rights, smart approaches for people at all stages. Gary Ley is also hosting a seminar in February the 24th in our office. It’s a Saturday. Will your savings last a lifetime that’s hosted by Gary Ley, C-F-P-C-P-A in our office Saturday morning, 10:00 AM to 12:00 PM and then Charles is also hosting another workshop in March about social security. That’s six March again, another Wednesday, six 30 to 8:00 PM here at our office. So those are the three workshops that are currently up on the website. If you’re interested in registering for any of those, there is no cost to attend any of these workshops by the way. And why do we do that, Joe?

(27:54):
We do that simply because we want to help you, help you not become a financial casualty because we see time and time again folks walking in our office for the first time and saying, geez, I didn’t know what I did and look what I did. Can you help me clean up this mess? And we want you not to be in that kind of situation so it’s totally tax free. Come to our office, you invite you to our state of the Art Learning Center here. We could easily accommodate 30 people with the high end quality audio, visual equipment and good stuff for you to take home. And this way, whether you’re considering doing retirement planning, maybe now or sometime in the future, you’ll give us an opportunity to earn your business. I want to go back to that text. We had the first text, I think, I can’t remember the lady or I assume it’s the lady, I dunno why I assume it’s a lady.

(28:35):
She wanted to know about the beneficiary naming the beneficiary if there are any tax consequences. A lot of folks don’t realize that what you name in your beneficiary and your 401k, your IRA, your annuity, your life insurance policy, it overrides whatever your will says, whatever your trust says, whatever ideas you may have about giving that money to somebody else, that is the document that’s going to determine who gets those funds. So you want to be careful about that, that be sure that those beneficiary forms are always current, particularly if you’ve had a divorce and you think about that and oh my gosh, my ex is still beneficiary on this account. There are ways for you to protect yourself and I would suggest that you be sure that you always have those forms current and that has to be filed with HR and with the custodian for those particular

(29:23):
Accounts. Yeah, that’s important. Anytime you have any sort of major life change, whether you get married, get divorced, someone in your family passes away, you have children, so on and so forth, that’s a good time to actually go and review those beneficiary forms and make sure that it reflects your current wishes because things change in life and what you may have set up 10, 15 years ago probably is not current and make sure that you just keep that stuff up to date.

(29:47):
And for our listeners that are also our clients, and I know we have many of them out there, we want to give you a heads up. Pretty soon you’ll be receiving some information for us regarding our trusted contact initiative. And this is something that we do regularly for our clients, but we want to be sure that everybody is covered. We’re going to give you the opportunity to let us know so we’ll have on file what we call trusted Contact. And this is someone that you designate that we can contact in the event that we suspect or feel that perhaps something isn’t quite right in your financial or personal life. And we unfortunately over the years we have seen this where people get taken advantage of, they all of a sudden making big withdrawals and something isn’t quite right and we want to protect you. And so we’re going to give you a heads up. That form will be coming to you so we can protect you and protect your family going forward. Totally personal, totally private, but once again, it’s the extra protection that we do for our clients here are certified financial groups, so be on the lookout for the trusted contact forum coming to you within the next month.

(30:42):
And as this episode is nearing its conclusion, maybe a question popped in your head but you don’t have time to call in right this second. Or maybe you have a question involving some private information about your finances you’d rather not talk about on air. If this sounds like you, the team at Certified Financial Group has Charles Curry in the office right now waiting to take your phone calls off the air. You can call the office at eight six nine nine eight zero zero. That’s 4 0 7 8 6 9 9 8 0 0. We got a couple of text questions and an open mic for the gentlemen coming up next. You’re listening to On the Money Where We’re Planning Tomorrow Today with the Certified Financial Group. Welcome back to On the Money brought to you by the Certified Financial Group for more than 30 years, the Professionals at Certified Financial Group have been answering questions for listeners every week on W-D-D-B-O. Joining us on the show today is Aaron Bur and Joe Bur and gentlemen, we do have an open mic question that came in for us. Let’s play that right now.

(31:54):
So I’ve been watching a lot of YouTube videos about this, but I’d like to ask some actual professionals before I do anything. What do you think is better? Investing daily? Investing monthly or lump sum investing in Mutual Fund or ETF or SOX or anything like that?

(32:11):
Dollar cost averaging will smooth out the ride for you and then do it whenever you’ve got the money. If you’re investing for more than 10 or 15 years, you can dump it in at one time. There has been studies that go both ways and I don’t think anybody’s conclusively said that Doing it daily, weekly, monthly makes it all depends

(32:32):
On what day you do it,

(32:33):
Right, exactly. And doing it dollar cost averaging, you’re going to take advantage of the highs and the lows a little bit more. Smooth out the ride somewhat. That’s what you do when you have a 401k. And that’s why in the long run if people just stick with it, it works. But there is,

(32:48):
And the challenge there is the emotions of investing when things are going down that people never want to do that. That’s

(32:53):
Why the dollar cost averaging,

(32:54):
Which is why dollar cost averaging works if you’re disciplined to stick with that same program no matter what’s happening, but you got to remove the emotion from it. Otherwise, if you can’t do that, then it doesn’t really matter. Right,

(33:06):
Right.

(33:06):
And we have one more text question to close out with the show today. At what age do you stop investing? This person is in their late seventies, 1.5 million in investments, 700 K in cash. We make a hundred K per annual from only pensions and social security, but live on 60 K annual. We are long-term care and then are in fair health.

(33:25):
I think the question is when should we take that 700,000 that we’re sitting in cash and just let it sit there and pay taxes on it and let it frankly rot with inflation doing what it’s doing and you get many years in front of you. It’s an opportunity to let that money grow for future generations. So if you have children or grandchildren or charitably inclined, that’s what you want to look at and have the opportunity for that money to do something because reasonably, you may as well just bury it in the backyard and not have any, you look back at what that money could grow to in 10 years, it’s phenomenal and you can do some wonderful things for future generations or for your charities that you’re inclined. I understand it provides peace of mind, but basically in what you’ve told me, you’ve got enough pension coming in, so security life is good. You don’t need the money. Why not do something for somebody else and let that money grow?

(34:10):
Yeah, it reminds me of the Bible story about taking your talents and burying them in the backyard. I mean, if you have the capacity or ability to do something good with that money, whether it’s be charity or if you want to pass it on to the next generation, you ought to be doing something with it. It seems like at some point some people reach a point where they’re financially set and then it’s then growing money for future generations or for charity or for whatever that other bigger cause is that they want to eventually impact. Right?

(34:38):
And what you don’t want to go crazy, you don’t need a high growth portfolio, but something that’s what we call moderate, which gives you some upside and protects you on the downside. But I think just letting it sit in a savings account or checking account or even CDs today in the long run, if you have time on your side is really a tragedy because that money will never grow and once a year has passed, you never get an opportunity to recover it. It investing is never a smooth straight line. I like to say if dieting and investing was easy, we all be skinny and rich. But if you’re well diversified in the long run, it does work. So that’s a show for today, Casey. Take it away

(35:11):
And if you have any questions off the air, Charles Curry is standing by with the Certified Financial Group taking your questions. That number 4 0 7 8 6 9 9800. Once again, that number is 4 0 7 8 6 9 9800. You’re listening to On the Money Where we’re planning tomorrow Today with the Certified Financial Group.

 

Leave a Comment

Your email address will not be published. Required fields are marked *

Translate »

Schedule A Virtual Meeting From Anywhere In The World