Excel in Retirement

Experts from the show:

A couple weeks Jerome Powell, the head of the Federal Reserve, stated the time has come to lower interest rates. The goal has been to lower the cost of everyday items we use while not plunging the economy into a recession. Talk about trying to walk on a tightrope over the Grand Canyon.

Believe it or not there’s even a fear and greed index that gauges which sentiment is most applicable at the time.

From the Wall Street Journal, “September is a popular time for companies to go public. This month’s stock-market volatility is putting some plans on ice. It isn’t just the market’s recent choppiness, they say, but that turbulence could flare up again, given the uncertainty around November’s presidential election and how much the Federal Reserve will cut interest rates this year.”

 From Fox Business, “About 61% of workers said they fear retirement more than they do death, while 64% said the thought of retiring is scarier than the thought of getting divorced. One reason for the fear is that Americans are worried they will run out of money in retirement.”

Last week I was talking to my friend Jason Benham and we were talking about how fear often leads to anxiety.

The World Health Organization states, “In 2019, 301 million people in the world had an anxiety disorder, making anxiety disorders the most common of all mental disorders.”

If you’ve been reading our newsletter for a while you may recall our mice problem we had a while back in our garage.

Investment advisory services offered through CreativeOne Wealth, LLC. Clients Excel, LLC and CreativeOne Wealth are not affiliated companies. Licensed Insurance Professionals. Investing involves risk, including potential loss of principal. Any references to protection or lifetime income generally refer to fixed insurance products, never securities or investments. Insurance guarantees are backed by the financial strength and claims paying abilities of the insuring carrier. Annuity withdrawals are subject to ordinary income taxes and potentially a 10% IRS penalty before age 59-1/2. Roth distributions are tax free after age 59-1/2 and the account has been open for at least 5 years. This video is intended for informational purposes only. It is not intended to be used as the sole basis for financial decisions, nor should it be construed as advice designed to meet particular needs of an individual’s situation. Clients Excel is not permitted to offer and no statement made during this show shall constitute tax or legal advice. Our firm is not affiliated with or endorsed by any governmental agency. The information and opinions contained herein provided by third parties have been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed by Clients Excel. The use of logos and/or trademarks of hosting sites are the property of their respective owners and are not an endorsement by those owners of our firm or our program. 

Investment advisory services offered through CreativeOne Wealth, LLC. Clients Excel, LLC and CreativeOne Wealth are not affiliated companies. Licensed Insurance Professionals. Investing involves risk, including potential loss of principal. Any references to protection or lifetime income generally refer to fixed insurance products, never securities or investments. Insurance guarantees are backed by the financial strength and claims paying abilities of the insuring carrier. Annuity withdrawals are subject to ordinary income taxes and potentially a 10% IRS penalty before age 59-1/2. Roth distributions are tax free after age 59-1/2 and the account has been open for at least 5 years. This video is intended for informational purposes only. It is not intended to be used as the sole basis for financial decisions, nor should it be construed as advice designed to meet particular needs of an individual’s situation. Clients Excel is not permitted to offer and no statement made during this show shall constitute tax or legal advice. Our firm is not affiliated with or endorsed by any governmental agency. The information and opinions contained herein provided by third parties have been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed by Clients Excel. The use of logos and/or trademarks of hosting sites are the property of their respective owners and are not an endorsement by those owners of our firm or our program.

I’m reading a book titled Think Ahead by Craig Groeschel, and one of the premises of the book is to pre-decide how we will react in given circumstances. My first thought was this would be a great book for teenagers to read. Planning beforehand for the outcome we know to be right is better than waiting until we’re under stress to think through what we should do. Under stress we may make bad decisions.

One of the reasons Groeschel said we sometimes make poor decisions is we are fatigued by all the decisions we have to make. He writes, “Experts estimate that we make 35,000 decisions a day.” 

Think about how many basic decisions you made before you even left your house this morning. You had to think about getting up, brushing your teeth, what to eat, what to wear, taking the dog outside, and the list could go on. 

The issue is by the time we get hit with a big decision we may not make our best decision because we have not predetermined our belief system about the topic.

In my previous volunteer work with a local ministry called Jumpstart, I learned that one of the ways prisons control the detained is by limiting the decisions they can make in a given day. Instead of 35,000 decisions they may have 6,000 decisions they can make a day. It stands to reason that the way we can control our outcomes is to limit the amount of mental energy we need to expend on making decisions.

As evidenced by major stock market trading platforms going down on Monday due to large quantities of people placing trades in their equity portfolios, a lot of investors may not have pre-decided what they should do in a market downturn. When we don’t have a plan, we subjugate ourselves to making decisions based on feelings and not on hard facts. The stock market likes predictability and we’ve seen historically unpredictable events transpire recently. 

The cool thing about our financial planning process is we have pre-determined how we should react in a down market so we don’t have to frantically attempt to make wise decisions in the chaos of the moment. In our 3 Roles of Money process we have our “red money” in the market, but we’ve segregated out our “blue money” to use over the next ten years. 

Investment advisory services offered through CreativeOne Wealth, LLC. Clients Excel, LLC and CreativeOne Wealth are not affiliated companies. Licensed Insurance Professionals. Investing involves risk, including potential loss of principal. Any references to protection or lifetime income generally refer to fixed insurance products, never securities or investments. Insurance guarantees are backed by the financial strength and claims paying abilities of the insuring carrier. Annuity withdrawals are subject to ordinary income taxes and potentially a 10% IRS penalty before age 59-1/2. Roth distributions are tax free after age 59-1/2 and th

People come to us for financial planning at different stages of life. Most of our clients are closing in on retirement or they’re in retirement, but that can be a 10- to 15-year window of when people generally become a client of our firm. I’ve gotten a bird’s-eye view into what works well and what doesn’t.

We normally recommend that people begin working on their financial plans for retirement when they are five years out from retirement. It makes sense to begin making the transition from an accumulation stage to an income and distribution stage five years out. Once we are closer to potentially using our funds, it makes sense to dial down our risk on some of our funds in order to figure out a way to increase our probability of being able to successfully take income out of our accounts. For that reason we are downside focused first because most of our clients are transitioning into retirement.

We also want to begin figuring out how much income you may be able to sustainably draw from your retirement accounts and make them last as long as possible. This may include tax planning strategies like converting tax-deferred 401k accounts to tax-free accounts and the implications around this. Healthcare planning and taking a crash course on Medicare is often helpful, as is figuring out your best Social Security claiming strategy.

We can do all this quickly, but when there is a window of time to work through these things, it allows for you to not feel like you have an exhausting summer of activities and you have time to rest in between mental exercises. It’s not easy planning the next 25 to 40 years of your life, and it’s best done methodically. If you’re like most of our clients, it took you 30 to 40 years to accumulate the funds you have. It definitely merits taking a few hours off work to figure how to make them last for the next 30 years.

Whenever you have questions about your financial plan, please reach out at 864.641.7955. Get David's book How To Excel in Retirement. 

Investment advisory services offered through CreativeOne Wealth, LLC. Clients Excel, LLC and CreativeOne Wealth are not affiliated companies. Licensed Insurance Professionals. Investing involves risk, including potential loss of principal. Any references to protection or lifetime income generally refer to fixed insurance products, never securities or investments. Insurance guarantees are backed by the financial strength and claims paying abilities of the insuring carrier. Annuity withdrawals are subject to ordinary income taxes and potentially a 10% IRS penalty before age 59-1/2. Roth distributions are tax free after age 59-1/2 and the account has been open for at least 5 years. This video is intended for informational purposes only. It is not intended to be used as the sole basis for financial decisions, nor should it be construed as advice designed to meet particular needs of an individual’s situation. Clients Excel is not permitted to offer and no statement made during this show shall constitute tax or legal advice. Our firm is not affiliated with or endorsed by any governmental agency. The information and opinions contained herein provided by third parties have been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed by Clients Excel. The use of logos and/or trademarks of hosting sites are the property of their respective owners and are not an endorsement by those owners of our firm or our program.

David starts out with a story about his recent vacation to Hilton Head Island with his family. Then he gets into some practical steps that can help you make good decisions. 

Today, I have a few practical things that sometime inhibit us from making the best decisions. When it comes to personal finances this is super applicable because we need to get our financial planning right!

I just finished reading a book called The Richest Man Who Ever Lived. It’s about King Solomon, who the Bible says is the wisest person to live and he was incredibility wealthy. The author, Steven K. Scott, has a section titled “The Cost of Being Naïve.” I’ve been accused of being naïve before (probably true) so I was particularly interested in the content. I have a predisposition to think the best about people but as we have probably all experienced, we probably shouldn’t extend that courtesy to everyone.

Whatever the case, we all want to make great decisions that result in our intended outcome, so what do we need to be aware of that prevents this from happening? Scott states several reasons why we sometimes don’t make good decisions. He writes, “We all have a natural inclination toward simplicity. We want things to be simple. We want to be able to figure things out instantly, without having to read an instruction book or doing homework. We want to believe everybody, and we want to accept what we’ve been told at face value.

Solomon warned us about assuming tomorrow will present the same opportunities as today in Proverbs 27:1. The author states, “The fact is, however, we do not live in a static world. Everything changes moment by moment, and presuming that we will have the same opportunities or conditions to respond to tomorrow that we have today is foolish and naïve.” My takeaway is to seize the day and squeeze as much out of our present as possible. What would we do today if we knew we could not do it tomorrow?

The next reason we may be naïve is we misplaced our trust. Perhaps, we trust someone or an institution that doesn’t merit our faith. Sadly, the author writes, “More often than not, people are less capable, less experienced, less competent and less honest than they seem to be.” Solomon recommended looking well into a matter and doing due diligence, and Scott analogized that due diligence is shining a floodlight on a situation. It illuminates what’s there or what may be missing.

Investment advisory services offered through CreativeOne Wealth, LLC. Clients Excel, LLC and CreativeOne Wealth are not affiliated companies. Licensed Insurance Professionals. Investing involves risk, including potential loss of principal. Any references to protection or lifetime income generally refer to fixed insurance products, never securities or investments. Insurance guarantees are backed by the financial strength and claims paying abilities of the insuring carrier. Annuity withdrawals are subject to ordinary income taxes and potentially a 10% IRS penalty before age 59-1/2. Roth distributions are tax free after age 59-1/2 and the account has been open for at least 5 years. This video is intended for informational purposes only. It is not intended to be used as the sole basis for financial decisions, nor should it be construed as advice designed to meet particular needs of an individual’s situation. Clients Excel is not permitted to offer and no statement made during this show shall constitute tax or legal advice. Our firm is not affiliated with or endorsed by any governmental agency. The information and opinions contained herein provided by third parties have been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed by Clients Excel. The use of logos and/or trademarks of hosting sites are the property of their respective owners and are not an endorsement by those owners of our firm or our program.

Another unique position we have as a company is to be able to offer solutions larger corporatized offices often do not have the ability to do. We all know the bigger things tend to get, the slower they are to innovate. Maybe it’s the bureaucracy or protocols or hierarchies, but whatever it is, when we have to deal with it it’s normally painful.

As an independent financial advisory firm, we don’t have layers and layers of corporate executives dictating the advice we can offer our clients. I believe this allows our clients to have solutions that are more tailored to their particular needs. Who likes one size fits all?

A quick example of this is our use of buffered exchange traded funds (ETFs). They’ve been around for a handful of years now and they are becoming more mainstream. The Wall Street Journal causes them “Boomer Candy.”

In 2022, every time the government raised interest rates to try to bring down inflation, the stock market stock went down. I had been on a training call a couple years prior to 2022 and had learned about buffered ETFs and began investing my own money in them on a monthly basis.

There are various different types, but one of our main go-to ETFs works like this. It credits interest based on the performance of the S&P 500 over a one-year period, and it has a defined outcome. We are buffered against the first 15% of losses in the S&P 500 over the year. In exchange for the protection, we are capped at making between 13% and 14%. The caps can vary from month to month. Of course, in any fund there is an internal expense ratio and then you may have management fees also. All in all it’s a generous upside with less downside potential than the overall stock market.

We’ve been using these since 2022 and corporate America is catching up two years later. I don’t know about you, but I like having access to the best possible solutions available to me, and I believe our business model allows for that.

We’d always be delighted to answer your questions if you have them. You may reach David at 864.641.7955.

Investment advisory services offered through CreativeOne Wealth, LLC. Clients Excel, LLC and CreativeOne Wealth are not affiliated companies. Licensed Insurance Professionals. Investing involves risk, including potential loss of principal. Any references to protection or lifetime income generally refer to fixed insurance products, never securities or investments. Insurance guarantees are backed by the financial strength and claims paying abilities of the insuring carrier. Annuity withdrawals are subject to ordinary income taxes and potentially a 10% IRS penalty before age 59-1/2. Roth distributions are tax free after age 59-1/2 and the account has been open for at least 5 years. This video is intended for informational purposes only. It is not intended to be used as the sole basis for financial decisions, nor should it be construed as advice designed to meet particular needs of an individual’s situation. Clients Excel is not permitted to offer and no statement made during this show shall constitute tax or legal advice. Our firm is not affiliated with or endorsed by any governmental agency. The information and opinions contained herein provided by third parties have been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed by Clients Excel. The use of logos and/or trademarks of hosting sites are the property of their respective owners and are not an endorsement by those owners of our firm or our program.

Connect with David at [email protected] or call 864.641.7955.

Marty and Jess Ansen loved going on cruises so much they opted to cruise indefinitely. I came across an article that said, A retired couple have been living on back-to-back cruises for two years, and claim it's 'cheaper' than if they stayed in a nursing home in their retirement years. Hopefully you’re not feeling our inflation problem quite that much. 

I don’t know about you, but that would be too long a boat for me. Although, I’ve never gone a cruise. Do you think you could live on a cruise ship? I guess it would depend on how smooth or choppy the water was.

From the Wall Street Journal, “Markets are unusually calm—and that’s making Wall Street nervous. Stocks have been on a steady climb, with the S&P 500 up 14% nearly halfway through 2024 and closing at 29 records along the way.” The S&P 500 continues to climb up, and as of this past Monday it’s up 15.22% for the year.

Read more about our financial planning approach here. 

Investment advisory services offered through CreativeOne Wealth, LLC. Clients Excel, LLC and CreativeOne Wealth are not affiliated companies. Licensed Insurance Professionals. Investing involves risk, including potential loss of principal. Any references to protection or lifetime income generally refer to fixed insurance products, never securities or investments. Insurance guarantees are backed by the financial strength and claims paying abilities of the insuring carrier. Annuity withdrawals are subject to ordinary income taxes and potentially a 10% IRS penalty before age 59-1/2. Roth distributions are tax free after age 59-1/2 and the account has been open for at least 5 years. This video is intended for informational purposes only. It is not intended to be used as the sole basis for financial decisions, nor should it be construed as advice designed to meet particular needs of an individual’s situation. Clients Excel is not permitted to offer and no statement made during this show shall constitute tax or legal advice. Our firm is not affiliated with or endorsed by any governmental agency. The information and opinions contained herein provided by third parties have been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed by Clients Excel. The use of logos and/or trademarks of hosting sites are the property of their respective owners and are not an endorsement by those owners of our firm or our program.

Last week the Federal Reserve board who determines if rates will rise or fall or remain met and determined that they were going to leave rates unchanged for the time being. The board is always vague about what comes next for rates, so it’s to be determined if rates decrease later this year. 

To many conservative investors this rate environment feels like they’ve walked into a perfect situation, because our rates we earn on cash is elevated. I’d ask you to consider whether the rate we earning on our cash is keeping us ahead of inflation. Of course, the government states inflation is one thing but most people I talk to tell me it’s higher. If we are earning less that real inflation we may be losing our purchasing power. 

The financial product space is always innovating and right now there are ETFs that have 100% downside protection that allow you to earn what the S&P 500 earns up to a cap. Some of them may earn well over what a C D earns. That beats the socks off what most CDs are earning, and the ETFs can be withdrawn anytime.

It’s always worthwhile making sure you’re getting the most value out of our money. If you’d like to discuss this further, please reach out at 864.641.7955. 

Investment advisory services offered through CreativeOne Wealth, LLC. Clients Excel, LLC and CreativeOne Wealth are not affiliated companies. Licensed Insurance Professionals. Investing involves risk, including potential loss of principal. Any references to protection or lifetime income generally refer to fixed insurance products, never securities or investments. Insurance guarantees are backed by the financial strength and claims paying abilities of the insuring carrier. Annuity withdrawals are subject to ordinary income taxes and potentially a 10% IRS penalty before age 59-1/2. Roth distributions are tax free after age 59-1/2 and the account has been open for at least 5 years. This video is intended for informational purposes only. It is not intended to be used as the sole basis for financial decisions, nor should it be construed as advice designed to meet particular needs of an individual’s situation. Clients Excel is not permitted to offer and no statement made during this show shall constitute tax or legal advice. Our firm is not affiliated with or endorsed by any governmental agency. The information and opinions contained herein provided by third parties have been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed by Clients Excel. The use of logos and/or trademarks of hosting sites are the property of their respective owners and are not an endorsement by those owners of our firm or our program.

David tells a funny story about having mice. Here is the link to the newsletter he mentioned.

Excerpt from the show: The hurdle that some people have is taking the next step. They reached out for help, issues have been identified, a plan of action to better the circumstances has been presented, but we sometimes worry about what comes next.

I’ll tell you, it took hours to get the garage in order and the better part of a day. But the results are worthwhile. Moving on from an old advisor who isn’t helping you get to the next stage of life is in my mind a lot easier than cleaning out a garage!

Here’s the other thing; just because someone helped you get to one spot, that doesn’t necessarily mean they’re the right person to get you to the next spot. Investing and financial planning when we’re within five years of retirement is a lot different than when we have ten or twenty years before we are going to retire.

Investment advisory services offered through CreativeOne Wealth, LLC. Clients Excel, LLC and CreativeOne Wealth are not affiliated companies. Licensed Insurance Professionals. Investing involves risk, including potential loss of principal. Any references to protection or lifetime income generally refer to fixed insurance products, never securities or investments. Insurance guarantees are backed by the financial strength and claims paying abilities of the insuring carrier. Annuity withdrawals are subject to ordinary income taxes and potentially a 10% IRS penalty before age 59-1/2. Roth distributions are tax free after age 59-1/2 and the account has been open for at least 5 years. This video is intended for informational purposes only. It is not intended to be used as the sole basis for financial decisions, nor should it be construed as advice designed to meet particular needs of an individual’s situation. Clients Excel is not permitted to offer and no statement made during this show shall constitute tax or legal advice. Our firm is not affiliated with or endorsed by any governmental agency. The information and opinions contained herein provided by third parties have been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed by Clients Excel. The use of logos and/or trademarks of hosting sites are the property of their respective owners and are not an endorsement by those owners of our firm or our program.