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Financial planning and investment management services provided through Certified Advisory Corp cac, a federally registered investment advisor. CAC is a federally registered investment advisor and only transacts business in states where it’s properly registered or is excluded or exempted from registration requirements. Information presented on this program is believed to be factual and UpToDate, but we do not guarantee its accuracy and it should not be regarded as a complete analysis of the subject’s discussed. Discussions and answers to questions do not involve the rendering of personalized legal tax or investment advice, but are limited to the dissemination of general information. Listeners should consult with a legal tax and or investment professional for advice specific to their needs.
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Stay tuned for on the Money Central Florida’s most listened to financial call and show Bronte You by Certified Financial Group in Almont 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 p, 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.
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Hello and welcome to On the Money right here on WDBO. AM five 80, always streaming inside your WDBO app. If you want to join in on the conversation, well, we’re talking money, we’re talking how to get to and through retirement. We’re talking all kinds of things. Well because it is that time of year here in the country of the United States as everyone’s talking taxes right now. So if you got questions, we have two certified financial planners in studio today we got Dave Bala Christian and Joe Bur with the team at Certified Financial Group Live, answering your questions on WDBO today as they has been doing for over 30 years on the airwaves of WDBO. Joe Dave, how are you guys doing today?
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We’re doing great. Good to be with you. As you said in the intro, we are here to take questions that might be on our listeners’ minds for more now than 30 years. This is not a one hour infomercial to tell you all about us. It’s in a one hour help session, if you will, to answer questions that you might have regarding your personal finances, decisions that you might be facing regarding your IRA, about a 401k regarding required minimum distributions, long-term healthcare, annuities, life insurance, reverse mortgages, all that stuff. And more that Dave and I and the 15 other certified financial planners work with our clients week in and week out, working as fiduciaries for a fee providing retirement planning and investment management on Saturday morning. We here for you absolutely free. So if there’s anything on your mind regarding any of those issues or anything I may not have discussed, the good news for you is the lines are absolutely wide open and all you have to do is pick up the phones and dial these magic numbers.
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8 4 4 5 8 0 9 3 2 6 8 4 4 5 80 WDBO or feel free to send in your question using the free open mic feature inside the WDBO app. Again, open up that WDBO app, bottom right hand corner, find the open mic button and send in your question to the qualified people, the experts at the certified financial group. Today’s topic, tune out the noise,
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Tune out the noise. Dave, a lot of noise out there lately, right? Absolutely. Why do you think there’s so much noise?
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I mean, there’s a lot of fun events going on. I guess fun is a relatively word that you can use with some context. Obviously the new administration is coming. There is a lot of policies that are being revisited aggressively. There’s all these changes that are being made. Essentially this is causing a lot of uncertainty, so this drives a lot of headlines. So there’s news about tariffs, news about immigration news, about what is the future earnings. I mean, this is what drives the stock market. So this essentially has resulted in a lot of different headlines. I mean, just talking about headlines from the last week, some of the headlines are stocks, wild week ends in the green, and then investors sit on cash as markets stagger. And then the last week was this, s and p hits a death cross. So there’s a lot of these technical mumbo jumbo that comes out. There’s a lot of things that are pushed out from a variety of media sources and there are the experts who are always looking to the prognosticators, looking to come up with an explanation as to what’s going on. I mean, how would you explain when the market goes up 300 points in the morning, then down 700 points in the evening, and then maybe closes at level? So there’s just a lot of things happening and people trying to provide an explanation.
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That’s
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The noise we’re talking
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About. All that stuff that’s going on the media. The media has to fill up their airwaves and the newspapers and newsletters with stuff and when the plane lands correctly, there’s no news about it. But when the plane crashes, you have a lot of news about it. And of course that’s the kind of stuff that sells. Airtime sells clicks. The name of the game today is clicks, how many clicks and how many eyeballs you’re going to get. And sometime the more outrageous the prognostication, the more clicks you get and the more money they make. So you have to understand out there that there’s a lot of people trying to get your attention, particularly when there are things are going on that are new and different. And right now the T word is out there and that’s all we’re talking about. The next 90 days. Are we going to have an agreement with the company with countries like Italy and Japan who’ve been to the White House and what’s going to happen in that regard and what does that mean for future earnings? It’s all about earnings, right? But the bottom line is at the end of the day, people, as I always say, people still have to buy cars, they have to buy refrigerators, they have to buy tires, they’re going to buy phones, all that stuff. The consumption is going to continue. Now, how their ability to do that of course is a function of the economy. And the good news is the economy’s healthy
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Despite what the prognosticators want you to think. Maybe the world is coming to an end. We’re relatively low unemployment. There’s a lot of jobs out there. Problem is many people don’t want to take the jobs. They’d rather collect unemployment and food stamps, but that’s a whole other
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Issue. So the fed’s coming out and talking about things are still he at least slowing down, but healthy. And I think the name of the game that really should be for a lot of the people out there is we are in this for the long term. So this is really about tuning out. The noise is all about for the long-term investors, not the stress over the day-to-day stuff that hits your screens with all kinds of technical jargon and whatever. Right here I have this returns chart that they talk about one year returns. If you look at this is particular chart about returns that have been over different time periods, one year period, five year period, 10 year periods in 20 year periods. And this particular one goes all the way back to
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19 46, 19 46, 46.
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So this goes all the way back there. So if you look at it, the stock markets have been as high as 60% in a given year as low as negative 41% if you look at it as one year increments.
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So in any one year, once again, let’s restate that. In any one year, the high was as high as 60%. 60% in any one year since 1946, 60% great year, one year. Okay? And the worst was
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Negative 41%.
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Negative 41,
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Yeah. However, if you kind of look at this in the longer term, and let’s look at maybe 10 year periods, what you see is the high has been as high as 21. So in a given five year period, average total returns has been in stocks, has been as high as 21% average, as low as negative 4%. I mean, that’s a very different spread in terms of how the market moves.
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That’s huge. And so what does that tell our listeners?
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The message is don’t stress over the news in the short term, don’t stress over the returns in any one year. The question is we are in it for the long term. Depending on where you are in your stage of life, there are things you can focus on and not specifically about one year returns, start taking the longer look.
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And the distinction is you have to understand between investing and speculating and what we’re talking about and what we do for our clients is investing, investing for the rest of your life. It’s not what are you going to make in the next year? Unfortunately, people oftentimes will, well, what’d you do for me this year or this month or this quarter or this week or even today? Pick up my phone. What happened today? And investing by, in order to be a successful investor, you have to think in long term and if you think long term things out. So you had one year, five year, give us a 10 year.
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So the 10 year, the 10 year one was the one I think I was going over previously, Joe. The five year one was it can be as high as a 30% and as low as 6%, negative 6%. And then if you really zoom out to the 20 year period, it can be as high as 18%. So if you look at it, average returns for the 20 year period, it’s a positive 18%, and the lowest was still a positive 5%. So that’s
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Repeating bears repeating one more time. So over any 20 year timeframe since 1946, there’s never been a negative return, correct?
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If you look at it in 20 year period.
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Yes.
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Yes.
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So unfortunately we only look at what we know today or maybe pick up the newspaper what we learned from yesterday, but you have to Now, the secret to that, of course is you need diversification and you need quality,
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Good portfolios, good diversification, making sure you choose quality investment. There’s always stuff about companies lifecycle in an index, maybe 10, 15 years. But it does require rebalancing. It does require paying attention, a little bit of grooming, but this is what is going to help you to nurture this portfolio over the long term to get that kind of returns, which is over 10 year or over 20 year periods. Invariably, it’s a positive overall and really a negative
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Return. And what we do for our clients here is we actively manage the portfolios, but that does not mean we jump in and jump out of the market because that’s a fool’s game because you just set the headlines over the last couple of weeks. Oh, I should have been in, I should have got out. I should have been in, I should have got out. The key is once again, to be diversified with quality, have a long-term horizon, and I like that word, groom your portfolio, take advantage of tax loss harvesting.
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Yeah, we’ll cover that
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As far as, oh, I’m jumping the gun here, but tax loss, harvesting and rebalancing,
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Those are the keys to long-term success. And then of course, having a portfolio to build built to get you to where you want to go without taking unnecessary risks. Unfortunately, most people, many people falling either one or two, two spectrums, either too aggressive trying to hit home runs, make up for lost time, where they’re trying to keep up with their neighbors and have a good cocktail party conversation, or they got burned in 2008, 2009, they’re never going to get in the market again. Want to stay on Wednesday from investing, have their money stuffed in CDs, and they’re never going to get there from here because they’re just wasting losing time and time is a great asset.
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Absolutely,
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Yes. So did we beat that to death or you want to continue with something else? Go ahead.
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I didn’t know if you wanted to go. Yeah, please. Yeah, let’s do it. When I talk to clients, maybe we’ll talk a little bit about the conversations I’m having with the clients I work with. Storytelling usually helps, right? So the question really is, think of everything here as you’re planting a seed with the intent of having a nice big tree to give you shade when you are ready to take rest, right? The story that we want to go about, and so do not look at the weather and worry about is it too sunny? Is it too cold? Is the wind blowing too hard? Is my plant going to survive? The seed germinate? There’s no point in constantly monitoring this. The intent is let that nature do its part. You do need to come in, kind of do some stuff, go ahead.
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You know what they say about your portfolio. It’s like a bar of soap. The more you handle it, the smaller it gets.
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That’s another way to say it.
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Yes, I It’s true. The more you handle it, the smaller it gets because you’re making emotional decisions as opposed to rational decisions, and that’s the role that we play for our clients to
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Keep
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You from blowing yourself up, frankly.
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Yep, absolutely. So essentially, we’ll talk about some of the stuff you can do in general and then maybe we’ll talk a little bit about what you can do at different stages, whether you’re an accumulator or maybe somebody who’s closer to return. So we’ll cover that in sequence. So as you started out, Joe, we spoke about rebalancing as a strategy. So this is an opportunity to think about, Hey, is my portfolio heavy in any particular domain? Should we rebalance it?
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That’s
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In terms of diversification to international, or do I need to diversify it to this being, this conversation about MAG seven in the last year, everything is US growth, large, heavy. Do I want to maybe diversify into it, maybe an equal weighted or something like that? So diversification conversations are totally appropriate at this
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Point, for sure.
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Then the second topic if you want to move forward would be conversions if you’re tax management as an opportunity here. So there is essentially, obviously there’s been a violent sell off in some names. If you’ve got in at a certain point, there’s a possibility you’re sitting on losses. So now is an opportunity for you to maybe strategically look through this and reevaluate if that position needs to be changed to a different size. Obviously we don’t want to be rash, but think about methodically. So there’s a little of tax planning opportunities here that we can definitely talk
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About. Yeah, you want to take advantage of the tax laws while you can because they can add to your gains long term.
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Yep,
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I hear the bumper music, Josh, take it away.
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Thank you so much. If you want to join in on the conversation, 8 4 4 5 8 0 9 3 2 6, we got some open lines for you to talk to Joe and Dave from the certified Financial Group, 8 4 4 5 80 WDBO or send in your open mic using the free WDBO app you are listening to on the money where we’re planning tomorrow today with the certified financial group. Welcome back to On the Money here on W-D-V-O-A five 80, always streaming inside your WDBO app. This is your chance to hop on the air. We got experts in the financial advisory field, two certified financial planners, Dave Ball, Christian and Joe with a certified financial group here. Answering your questions today. Pick up the phone right now, dial eight four four five eight zero nine three two six eight four four five eighty WDBO or send in your question using the free open mic feature inside the WDBO app or if you want to go see ’em at a party at their place. Something’s going down next weekend.
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Yeah, next weekend we’re going to be broadcasting live here from our offices in Altamont Springs, right here on Douglas Avenue. From nine to 11, we will be doing the show right from here, our front porch, while we’re hosting our annual shred event, we bring in a commercial shredding truck, huge truck. You can see your stuff shredded right before your eyes absolutely free. However, we ask that you limit it to two bankers boxes. One year we had unfortunately, well, I guess a dentist who had retired and had his entire years, many years of records stuffed in his van. And I want to tell you this, the seats were removed, the only seats were in there was the driver’s seat and the passenger seat all the way back, filled up top to bottom, front to back was all of his records, and we spent a lot of time shredding his stuff. So we had to have a two limit banker box. Anyway, that’s for you. Come on by nine to 11 next Saturday morning, went off a coffee, donuts, come by and meet the group. We’ll all be here shaking hands, meeting our many, many, many listers and are giving away some tchotchkes too. Some good stuff, right, Dave? Yep. Flashlights and hand sanitizers and pens, and it’s a bizarre over here.
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It’s an event to come and check us out.
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It’s a bizarre, bizarre. Yeah. So you can do that next Saturday here at Office of Altamont Springs. For more information, go to our website, that’s financial group.com, financial group.com, and you’ll see the events there as well as the upcoming workshops we have scheduled for May. So we hope you come on by the weather. Hope should be good, but boy, do we need some rain?
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Yes.
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Oh my
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Gosh, we could definitely use some rain.
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It’s fire threat. Now, the worst thing we need, oh, who knows who? Doess.
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There’s a, what is it called? A ban on having open fires?
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Oh yeah. Open fire burn. Yep.
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It’ll be the numbers drop again.
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Yep. You’ve got a call there, Josh, take it away.
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That’s right. If you want to call in (844) 580-9326. We got George calling in from Orlando. Go ahead George. You’re on with the certified financial group. Morning, George. What’s
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Up? Hey, good morning gentlemen. So I have a variable premium nu that qualifies as an IRA. Now I understand that you have to pay taxes eventually we have been doing, but my question to you is why do they make you do this RMD make you take out money that you worked for and save and then that money’s never going to gain interest again?
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Well, because that money has never been taxed, George. That’s the reason, because the money that went into the IRA you never paid taxes on while it was in the IRA, it was growing without being taxed, and now it comes time to pay the taxes on the money that you put in as well as the money you’re taking out. And that’s basically why it works.
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Yeah, uncle Sam always wants to have their cart. I mean, we talk about this in our IRA workshops. Uncle Sam always wants to have their cart. They’re obviously given the opportunity to put it away without paying them, but this is basically a future debt that they want to collect in terms of taxes. So when you eventually want to take it out, they’re going to collect taxes on it and they’ve moved it to 73 and then it’ll also move to 75 for those born after 1960. But at the end of the day, they want their share to essentially collect what’s owed to them. So that’s why we talk about the monkey is never off the back. Right?
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But I could tell you one thing, George, had you not used that money or put it into an IRA and just try to invest it outside, which you could have done with your annuity there, you didn’t have to put it in an IRA. You would not have nearly as much money as you have today because it’s been sitting there compounding and growing without taking an annual piece off the top to pay taxes on. So that’s the beauty of using an IRA or your 401k or 4 0 3 B or 4 57, you’re getting an immediate tax deduction on top of the money not being taxed. I guess that’s saying the same thing only it’s a different way, but the money you get to take a tax deduction and it stays in the account without being taxed, which means it just compounds and grows. And that’s the beauty of using these plans, particularly when you’re young, right, Dave?
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Yeah, absolutely. And I mean that’s the benefit of putting it in an IRA, but I think I want also address, George, your question on when you take it out, it doesn’t get any interest. I don’t think that’s a valid statement. So we have a lot of people who have built a good portfolio in their IRAs and eventually they have to take RMDs and they have a lifestyle that they can support with other income, maybe social security, maybe a pension, maybe something else. So what we encourage people to do is if you don’t need the money, obviously put it in a taxable account, you can still put it in a taxable account and let it grow again, you’ll pay some capital gain taxes on what grows. So I would at least contest your thought process that you do not, the money does not gain interest after you take it out of an RMD
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Unless you bury it in the backyard,
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Unless you buried it in a backyard. Of course, right?
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There are opportunities, in fact we do that for our clients. As you just said, they don’t need the money fortunately, and they just take those funds and reinvest it sometimes in the exact same thing you had in your IRA because they like the investments, it’s doing well or it’s part of their overall plan, and then you just keep the account going outside the IRA, right? So George, I hope that answers your questions and unfortunately we have to bring taxes and that’s why you’re being taxed for the first time on those monies.
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Thank you so much, George. If you want call them right now. We got Dave Ball Christian and Joe bur two certified financial planners with the certified financial Group answering your questions live on the air. If you want to call in five eight zero nine three two six eight four four five eighty WDBO or send in your open mic using the free WDBO app you are listening to on the money we’re planning tomorrow
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Today
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With the Certified Financial Group.
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Welcome back to On the Money Central. Florida’s most listened to financial call and show Bronte 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 rest of the show.
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Welcome back to On the Money here on WDBO AM five 80, always streaming. Inside your WDBO app, we got Joe Bur and Dave Bala Christian, two certified financial planners with a certified financial group in the room today we got on the money being on the airwaves of WDBO, the only financial call in program of its kind in the area. So if you got a question, this is the right time and the right number to call in because I know a guy, it’s 5 8 0 9 3 2 6 8 4 4 5 80 WDBO or you’re more than welcome to send in your question using the open mic feature inside our WDBO app. Okay,
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Go ahead Josh. Before we get to the text question, I saw floated in, David wants to follow up on the tuning out, the noise for those listen of mine, you’ve just tuned in and hopefully not tuning out our noise. It has to do with all of its headlines that have breaking lately about what’s going on in the market and the huge swings and tariffs and all that other stuff. So how to really make yourself put yourself at ease, I would say, right, Dave?
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Yep. That’s the goal, right? It’s important that we maybe follow the news to be informed, but how do you maybe focus on what’s important and moving away from the daily, the news mumbo jumbo, that’s to you continuously. I think here we started off earlier talking about how we address our different clients and depending on their stage in life, everybody is in a journey to get to a better place always. And it’s important that needs are addressed depending on where they are in their stage of life.
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So we talk about it, particularly if I’m meeting with a very young person who’s just starting out their career. They are highly energetic, they want to keep going, they want to keep pushing. So maybe their focus is about growing that first investment. So I think what we take time to remind people there is time is in your favor. If you’re particularly this 20 years, 30 years, 30-year-old who’s just in their first job, you have your money that you’re making, obviously you’re living life, hopefully you’re paying yourself first. It’s something we talk as we talk about our plans, pay yourself first, save something and then invest it and let time do its thing. Do not, as Joe spoke about it, don’t handle the soap too much too early because it’s going to go out very fast. So let it grow. Put in a portfolio,
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You got to let it simmer. You got to let it marinate. Put the ingredients together. If you have the right ingredients, let it marinate for a while and don’t keep stirring the
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Pot, right? And then I mean, if you go into Twitter, you go into Facebook, there’s all these schemes that people are talking about how to grow it quick. Those are typically schemes that make you handle the soap too soon
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And
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Therefore focus on letting it grow and take the time as in your favor.
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I think one of the real tragedy, not tragedies but interesting challenges I think that many particularly young people have today, is having all this information on your cell phone right there in front of your face. You see what’s going on. And then Robinhood did a great job of gamification, of making, investing a game and giving you gratification visually when you’re going up and the balloons go off and the firecrackers go off and it’s like a video game and you’re playing with your
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Money
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And that that’s done investing. You can play around all you want, but you’re not going to get there from here. Now that doesn’t mean you can’t get lucky and be in the right place at the right time and do well, but more often than not, it’s like going to Las Vegas. You’re going there for the entertainment not to get
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Rich.
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It’s the same dadgum thing.
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Absolutely. And you can see this, I mean, I follow Facebook and X, as you walk through some of these things, there is a section in there where there’s a lot of people who talk about stock tips and whatever else, and it’s hilarious. You watch them as the market goes up, there’s a lot of, I did this, I get great, and so on and so forth. And then as in the last three weeks, I would say the volume is really toned down. So a lot of people are missing in from the mid space. So these are all, as you say, it’s not investing, it’s really gambling to a certain degree, trying to find that lucky break and maybe shoot for the moon as they call it. Yes, you might catch one or the other, but it’s probably not a consistent way to get there. Moving on, we’ll talk about the mid-career professionals. So these are the people who probably have had their first child have a house, now they have a little bit more of the income that they actually can put away
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Folks in their late thirties, early forties,
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Probably forties, fifties, right, early forties, fifties. At this point, your goal is all about maximizing that savings, maximizing, I mean, your cost of living has gone up because you’re now supporting a larger family. Households, obviously things are there. The emphasis really is about managing your cashflow in terms of living within your means, making sure again, you continue to pay yourself first. It’s very typical in your first job, maybe you put away 20, 25% of your money and when you’re in your forties and fifties, maybe 15%, 10% of your money. So yes, the percentage of saving goes down, but that should still be the priority. So to keep feeding that pot and keep letting it invested so that this is this concept of dollar cost averaging, right? Do not worry about where the market is. Keep growing that position in small bits and feed it continuously. And I think that’s the other piece. People in their forties and fifties, maybe their focus really needs to be around throwing that small extra bit, continuously, consistently, repeatedly so that portfolio grows and that’s something maybe should be the focus and less so of the noise that’s constantly hitting your screen.
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You said a very keyword there, and that’s priority. We all have a limited amount of income resources and then you have to look at the priorities that you have. So let’s take that couple, that mid-career as you call ’em, that maybe have had the couple of children, and I’ve been through this myself, so I can speak from experience and you’re looking at all the things that are coming down the pike College, perhaps weddings, buying cars, maybe a bigger home, all that stuff. Just children’s sports. Oh my gosh, children’s sports will kill you and all the stuff that running a life and somewhere along the line, your ultimate retirement should be in there. And if you don’t make it a priority, you’re not. You’re going to wake up at 56, 60 years old and realize, okay, I did all this stuff and now I have to worry about me and there’s no time. I’m not trying to sell planning. But folks, this is what planning is all about. Looking at where you are today with what you want to accomplish, what you have to work with, what your priorities are, and then figuring out how you can do it with the income that you have
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And what is it going to take when it comes time to retire or when you’re forced into retirement, how much capital you’re going to need to sustain your lifestyle, whatever lifestyle that may be over and above social security. And if you don’t do it, nobody’s going to do it for you.
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And
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This is what certified financial, this is what we do day in and day out for our clients, working with our clients for a fee, showing them exactly what they need to do and how to get there,
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Help them prioritize. I mean, help them prioritize.
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And
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It’s a conversation that I have all the time. I mean, you want to take care of your children, you want to take care of your parents a lot of the times, the priorities on somebody other than yourself, and somehow your priority falls down that list. And I think it’s something that we constantly remind people that you are also important. You have to bring your own personal goals, your personal objectives, have something that you’re shooting for and make that a priority and make those steps. You got to take one step at a time forward to move towards the direction that you want. And it’s something that we constantly remind people in our conversations is taking care of you is just as important as you live life,
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Right? Life is a marathon, it’s not a sprint. And I think human nature being what it is, we want instant gratification. We want to see it happening quick. We don’t see the count growing fast enough. We don’t think it’s going to grow in time. So we just kind of put it at the back of our mind and ignore it. And think one of these days that we’ll figure out how to do it. And next, before you know it, it’s 5, 10, 15 years and you’re looking back, as you said earlier on time is a great asset. And if you don’t use it wisely, if you don’t use it prudently, it’s gone. You can never recover it. And the earlier you start on saving and investing, we tell our clients to tell their children where they bring now their clients bring in their grandchildren to us so we can give them the come to Jesus meeting, if you will. But what you need to do to be sure that you’re going to be okay,
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Pay and yeah, get them to,
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If you don’t pay yourself first, nobody for you
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Something that you constantly think about.
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So you got some more steps there.
(31:12):
So again, maybe then we’ll shift our focus to that, the people who are nearing retirement, right? I mean, this is a big fear. So you’ve lived life, your children are out of the house, maybe you are almost empty nesters, and now you’re thinking about, okay, what am I going to do next? I am going to be retiring and then this happens, the tariffs and that and this and the market’s dropping, and there’s all kinds of things that are happening. And like we were talking about, maybe you haven’t been feeding that portfolio on a continuous basis and now you need to rush to catch up. These are stressors. But at the same time, this is another piece of conversation we have all the time. Just because you come in in your late fifties, early sixties doesn’t entirely mean it’s a lost cost.
(31:59):
There
(31:59):
Is, again, bit of planning, a bit of priority setting. There is a way to get to that destination to maintain a lifestyle, which is the goal, right? Live your lifestyle, the way you’ve been living all your life as best as you can. So it’s a bit of maybe a reality check, but then we have a plan to get there. And then it’s a question of not stressing about the portfolio balance necessarily, but think about what is going to be, what do I need to build it to, but also think about how am I going to draw from it? What is the source? What’s the priority? What kind of investment am I going to withdraw from first? Do I use leverages in terms of, again, depending on situations, a reverse mortgage or something. The question is how do we generate cashflow and come up with a withdrawal plan that makes the most sense to maintain the lifestyle that we live?
(32:51):
I mean, and this is a thing I commonly say, if you’ve been living a good life, you’re not going to all of a sudden like going to the soup line. It’s just not going to be a fun experience. So the question is, what can we do? Start early and start thinking about what would be your sources of withdrawal? And then we go into the next phase of life, and this is the retirement phase. And there is people who are maybe almost retired or just retired. And then there is this big thing we talk about what is your withdrawal percentage? And there is the sequence of return risk. I mean all these big words.
(33:21):
So wait, wait, let’s talk about, you just glossed over that. That’s a critical part of retirement planning is the sequence of returns. Let’s talk about what that means.
(33:29):
So the sequence of returns is essentially you want the portfolio to be growing or at least not sinking too fast just as soon as you retire, right? It’s year over year returns.
(33:43):
In other words, you don’t want a black Monday.
(33:45):
Exactly. You don’t want a black return
(33:47):
When you retired on Friday. You don’t want a black Monday.
(33:49):
Exactly. And then, so the question is make sure that your portfolio returns are not sinking too fast, where it affects your retirement. You have 20 years, 30 years of life after your retirement. How do we make sure that you don’t run out of money?
(34:05):
But it’s especially significant in the early years.
(34:08):
Correct? So I was going to say, the first 10 years of retirement, the returns in the first 10 years of retirement have an outsize impact
(34:17):
On
(34:18):
The likelihood of success. In other words, whether you will have enough money through your retirement. So the first year, 10 years of returns have a big impact. So unfortunately, you cannot control how the market behaves, right? And this is where having a plan, so you obviously, hopefully you’ve done a plan, you’ve identified your income sources, whether it’s again, social security or your savings or whatever else that might be. Now the question is have we had conversations to protect that income stream? So again, we talk about what is a bull bull market cycle? What is a bear market cycle, recessions, and so on. Typically these are 12 to 18 months in a worst case scenario. So the question is, can I live through that and then hope the portfolio can grow back to a point where it doesn’t affect my income stream? And I think that’s what we are talking about when we’re talking about protecting the sequence of returns. In other words, keeping maybe a portion of your portfolio in cash or cash like to help you through maybe a quick downturn,
(35:25):
Right? And the worst thing you do is a cash out when it’s down, because when it comes back, you’ll never recover what you lost. Correct. That’s the key. I hear the bumper music, Josh, take it away.
(35:33):
Thank you so much. If you want to call in five eight zero nine three two six is the number 8 4 4 5 80 WDBO. Or feel free to drop an open mic inside our WDBO app you are listening to on the Money where we’re planning tomorrow today with the Certified Financial Group.
(36:11):
Welcome back to On the Money here on WDBO AM five 80, always streaming inside your WDBO app. This is your chance to talk to the experts in the financial advisory field. We got Dave Bala Christian and Joe Bur two certified financial planners from the Certified Financial Group. Wrapping up another great hour of the money. Now a question just popped into your head. We do have Rodney OBE standing by in the office there at Certified Financial Group. And Rodney can be spoken with at 8 6 9 9 8 0 0 4 0 7 8 6 9 9800. Maybe a question popped into your head right now as the show comes to a close or maybe you want to get a little personal, you want to get right to the source of working with a certified financial group. Rodney, another certified financial planner, is standing by at 4 0 7 8 6 9 9800.
(37:03):
We were talking about longevity and the need to stick with the plan. I got a very heartwarming email this morning from longstanding clients. In fact, it’s their 40th anniversary. And we sent them a little gift basket to celebrate that. And he took the time to, first of all, thank us for it, but secondly to he sent me a picture of the plan that I did for him back in 1987, and he’s since retired and he and his wife are going out to the beach. They bought a house in Hilton Head and the house they have in Atlanta. But we’re talking about the need to stay with the plan. And these folks joined me in 1987 and we had black Monday in 1987, I think back, all the things that happened Black Monday, the.com bust in 2000, the financial crisis in 2008, 2009. And through all that stuff, we just stuck with the plan.
(37:56):
We knew where we were going, we know what we had to do. They’ve been through the ups and downs, and it was just after you’ve been in this business for so many years to get those kinds of acknowledgements from people that you’ve had clients for many, many years, and a heartfelt appreciation for it. And the interesting thing about this is his father was one of my very original clients and he sent his son to me when he was just starting his career and they have since retired and enjoying life. So Ginger and Jack, who wish you all the best, if you’re listening up there in Atlanta and happy anniversary to you, I want to say once again, we’ve got the shred event coming up, right, Dave?
(38:31):
Yep. This is Shred Events next week and come on by and off, I think there’s a limit on two boxes, two bankers boxes. But yeah, come on in, meet all the planners will be around helping out. You can come by, pick up some charge keys as we drive by maybe a donut if you’re early enough and drop off stuff that you’re looking to get rid of. And we look forward to talking to you, interacting with you. And yeah, so come on by.
(38:58):
Next Saturday from the show will be here live from nine to 11. We’ll be shredding from nine to noon. So bring two bankers boxes by if you want to do that more information, go to our website. That’s financial group.com. And I want to remind you that Rodney Obe, certified Financial planner and also CPA is taking calls off the air. Rodney is one of the 17 certified financial planner professionals that we have here working with our clients. So if you want more information about who we are and what we do, go to our website. That’s financial group.com. That’s financial group.com, and we hope to see you next Saturday.
(39:34):
Thank you so much, Joe Bur and Dave Bala Christ, two certified financial planners with the Certified Financial Group. Another great episode of On the Money here on WDBO. Add that to our inventory of 10,000 great episodes that we’ve had here on the airwaves. Again, we got Rodney Oby standing by in the office. If you want to reach out to the Certified Financial Group, call right now. Tell ’em you’re listening to him on the radio. 8 6 9 9 8 0 0 4 0 7 8 6 9 9800 you’ve just listened to on the Money or we’re planning tomorrow today with the Certified Financial Group.
