Navigating the Retirement Risk Zone

Today I am going to share 3 critical ways to manage risk in your retirement portfolio.

Whether you are fully invested or have cash that has been sitting on the sidelines,

I believe that you have more influence over your investment outcomes than you are being led to believe.

Now, The process and tools I go over today are influenced by my personal beliefs about investing - 

But I do believe that they can help you deploy your cash, reduce risk, or shield from volatility - but it will require an understanding of some basic concepts.

If you found this episode helpful, subscribe so you don't miss any future episodes.

Also, I'd greatly appreciate it if you gave a rating and review. It helps other people just like you find the podcast and benefit from discussions on these topics as well.

Eric Amzalag, CFP®, RICP®

_ _

Want help with your Retirement Plan?

Schedule a free consultation

Email me: [email protected]

Visit my Youtube Channel

#retirement #howmuchtoretire #retirementplanning #rothira #rothconversion #investing #401k #socialsecurity

When is a one - off financial planning fee appropriate?

When is a percentage of assets under management fee appropriate?

Everyone has opinions about these matters 

And today I’m going to share mine with you all.

If you found this episode helpful, subscribe so you don't miss any future episodes.

Also, I'd greatly appreciate it if you gave a rating and review. It helps other people just like you find the podcast and benefit from discussions on these topics as well.

Eric Amzalag, CFP®, RICP®

_ _

Want help with your Retirement Plan?

Schedule a free consultation

Email me: [email protected]

Visit my Youtube Channel

#retirement #howmuchtoretire #retirementplanning #rothira #rothconversion #investing #401k #socialsecurity

I came across a retirement finance article recently that really sent me loopy.

The title was:

 Almost 50% of US households will outrun their savings in retirement — but this 1 money move could sustain your nest egg

The article quotes a study from the Morningstar Center for Retirement & Policy Studies.

Once I got past how misleading and malicious the headline was, the content underneath was actually reasonably good.

But I thought I’d make a quick video on the matter to show you all, people looking to retire happily and well, how the machine is working against you.

If you found this episode helpful, subscribe so you don't miss any future episodes.

Also, I'd greatly appreciate it if you gave a rating and review. It helps other people just like you find the podcast and benefit from discussions on these topics as well.

Eric Amzalag, CFP®, RICP®

_ _

Want help with your Retirement Plan?

Schedule a free consultation

Email me: [email protected]

Visit my Youtube Channel

#retirement #howmuchtoretire #retirementplanning #rothira #rothconversion #investing #401k #socialsecurity

People who are in a good place to retire often do things that others do not - knowingly or unknowingly.

See, retirement is all about having plans in place.

Proactive plans that tell you what you SHOULD do.

But also REACTIVE plans that tell you what to do in case of an emergency.

These REACTIVE plans are what you rely on when one of your proactive plans goes wrong.

The group of people who are unknowingly in a good position to retire early are frequently there because they have been better about preparing their PROACTIVE plans.

If you found this episode helpful, subscribe so you don't miss any future episodes.

Also, I'd greatly appreciate it if you gave a rating and review. It helps other people just like you find the podcast and benefit from discussions on these topics as well.

Eric Amzalag, CFP®, RICP®

_ _

Want help with your Retirement Plan?

Schedule a free consultation

Email me: [email protected]

Visit my Youtube Channel

#retirement #howmuchtoretire #retirementplanning #rothira #rothconversion #investing #401k #socialsecurity

No one wants to pay taxes - not before retirement, and certainly not IN retirement.

Today we are going to talk about Required Minimum Distributions and how to minimize the tax consequences of those RMDs.

The truth about taxes in retirement is very different from what we are led to believe online…

It’s very easy to feel like there is a “tax bomb” somewhere in your future.

It would be reasonable for that “tax bomb” to instill fear in you.

But the reality is that fear - especially when it comes to taxes - often leads to decisions with consequences that we may not always be clear about.

I'm going to illustrate this using a story.

If you found this episode helpful, subscribe so you don't miss any future episodes.

Also, I'd greatly appreciate it if you gave a rating and review. It helps other people just like you find the podcast and benefit from discussions on these topics as well.

Eric Amzalag, CFP®, RICP®

_ _

Want help with your Retirement Plan?

Schedule a free consultation

Email me: [email protected]

Visit my Youtube Channel

#retirement #howmuchtoretire #retirementplanning #rothira #rothconversion #investing #401k #socialsecurity

In today’s video I’m going to do my best to address what might be the most frequently asked question when hiring a financial advisor - how much should I pay?

I am a Certified Financial Planner and Owner of an Independent Financial Planning Firm, and every year, we help retirees build robust retirement plans that match their life goals.

Despite the fact that I myself AM a financial advisor, and therefore am undoubtedly biased in this evaluation, 

I believe there are many routes to financial and retirement success - and many of those routes DO NOT require hiring a paid, professional financial advisor.

But if you are in the position where you may want the help of a paid professional, it can be a truly daunting task to understand if you’re getting the value that you are paying for.

In this video not only are we going to walk through how to identify whether or not you should hire a professional paid financial advisor, we are also going to compare and explain the different fee structures within which financial advice can be obtained. 

If you found this episode helpful, subscribe so you don't miss any future episodes.

Also, I'd greatly appreciate it if you gave a rating and review. It helps other people just like you find the podcast and benefit from discussions on these topics as well.

Eric Amzalag, CFP®, RICP®

_ _

Want help with your Retirement Plan?

Schedule a free consultation

Email me: [email protected]

Visit my Youtube Channel

#retirement #howmuchtoretire #retirementplanning #rothira #rothconversion #investing #401k #socialsecurity

The 3 types of retirement plans (The  Retirement Plans That Work For ALL Retirees)

Today I am going to explain how to prioritize your retirement planning efforts if you are within 10 years of retirement.

After building hundreds of financial plans, I’ve learned that there is an optimal “financial” order of operations that when used helps retiree’s save time and reduce stress.

In this podcast I am going to share the exact protocol we use at our independent financial planning firm to help clients get the most done with the smallest investment of time. 

If I could summarize all the concepts from this video into 1 sentence it would be:

A mediocre plan that you can execute over long periods of time is far better than an incredible plan that you eventually abandon.

[...]

The downloadable material referenced in the podcast can be found here.

If you found this episode helpful, subscribe so you don't miss any future episodes.

Also, I'd greatly appreciate it if you gave a rating and review. It helps other people just like you find the podcast and benefit from discussions on these topics as well.

Eric Amzalag, CFP®, RICP®

_ _

Want help with your Retirement Plan?

Schedule a free consultation

Email me: [email protected]

Visit my Youtube Channel

#retirement #howmuchtoretire #retirementplanning #rothira #rothconversion #investing #401k #socialsecurity

Resources referenced in the video:

Income Labs

Everydollar

RPI Spreadsheet Calculator

Better Portfolio Risk Measures

If you found this episode helpful, subscribe so you don't miss any future episodes.

Also, I'd greatly appreciate it if you gave a rating and review. It helps other people just like you find the podcast and benefit from discussions on these topics as well.

Eric Amzalag, CFP®, RICP®

_ _

Want help with your Retirement Plan?

Schedule a free consultation

Email me: [email protected]

Visit my Youtube Channel

#retirement #howmuchtoretire #retirementplanning #rothira #rothconversion #investing #401k #socialsecurity

In this episode I cover sequence of returns risk as thoroughly as one can cover it. The episode show notes include:

• What is sequence of returns risk?
  • Sequence of returns risk is the risk of negative market returns near or during the time when you will take withdrawals from retirement assets.
  • It’s particularly pernicious for people within 5-10 years of retirement or in the first 5 years of their retirement because it has an exponential effect on portfolio depletion
  • Welcome back to Navigating the Retirement Risk Zone.
  • I’m Eric Amzalag, Certified Financial Planner and Retirement Income Certified Professional. I am the owner of Fee Only Financial Planning firm Peak Financial Planning.
  • For the next 15-20 minutes we are going to go deep down the rabbit hole of sequence of returns risk - not academically, but very practically.
  • I’ll explain what it is, how to understand it, and how to plan for it in your retirement planning efforts. You’ll want to stick around to the last third of this podcast where I’ll address the investment specific strategy.
• Two layered principals that make up SORR
  • The unequal relationship between market declines and positive returns
    • Give example from spreadsheet
  • what happens when we add in distributions on top of market declines
    • Example relationship from spreadsheet

• Why SORR is particularly pernicious in retirement planning tools
  • Most retirement planning tools will default to straight line illustrations (straight line rate of return)
    • If you don’t look under the hood, you will get blindsided

• How do we plan for/ protect against sequence of returns?
  • Comprehension
    • 1 - Understand the two components mentioned before - the unequal relationship between market growth and market decline and the time it takes to recover
    • 2 -  understanding portfolio withdrawals additional impact on that recovery timeline
  • Proper Planning
    • Don’t rely on Monte Carlo or retirement planning tools probability of success - it will mislead you
    • Stress test your financial plan with multiple “investment return scenarios” as well as multiple withdrawal / spending strategy scenarios
  • Bottom up withdrawal to investment strategy
    • Usually we begin with asset allocation in mind - and it is important and should be addressed but planning for sequence of returns 
    • Withdrawal rules - something like: withdraw from portfolio returns when portfolio values are up (to preserve cash and cash like investments), withdraw from cash and cash like investments when portfolio is down (to allow time for investments that have lost value to recover)
    • Depending on ability and level of wealth, build an asset allocation that will support that withdrawal strategy
      • Each person will need to determine the amount of cash/cash like investments they can support in their portfolio and still meet their desired spending in retirement.
    • Fill in the asset allocation with specific and appropriate investments that actively support the hedging goal - don’t blindly purchase funds that fit the asset allocation at a categorical level - an easy example of where people go wrong is thinking that intermediate and long term bonds are actually LOW VOLATILITY and are “cash like” because the asset allocation says that the bond part of the portfolio is the defensive part. Share anecdote about result of 2022 market correction and int+long bonds getting clapped.
    • Diversify out of concentrated positions
      • Having more individual investments reduces “concentration risk” and allows for investment specific pruning when markets decline.
      • A 3 fund portfolio only has so many areas where you can prune while waiting out a recovery

• Thinking about planning for sequence of returns
  • It’s like purchasing insurance
    • When things are going well, we think we don’t need it
    • But in many areas of our lives, we buy insurance.
    • Even though we hope we never need to rely on it - and will be thrilled if we get through life without having to call upon it, we still purchase it because it is prudent
  • Portfolio strategies to protect against SORR serve the same function
    • When markets are going up - it will feel unpleasant to watch the “hedge” in your portfolio underperforming the rest of the portfolio.
    • It is not an investment strategy if you do not have a hedge - that is called gambling.

If you found this episode helpful, subscribe so you don't miss any future episodes.

Also, I'd greatly appreciate it if you gave a rating and review. It helps other people just like you find the podcast and benefit from discussions on these topics as well.

Eric Amzalag, CFP®, RICP®

_ _

Want help with your Retirement Plan?

Schedule a free consultation

Email me: [email protected]

Visit my Youtube Channel

#retirement #howmuchtoretire #retirementplanning #rothira #rothconversion #investing #401k #socialsecurity

This episode will detail how we help clients understand when they can SPEND MORE in retirement.

• Retirement is all about matching how much you would like to spend, with how many years you expect to live, with how large a portfolio you will need to support that spending.
• The permission to spend problem arises bc of the amount of uncertainty around this spiraling formula. And what ends up happening is without a good grasp of how to measure risk and likelihoods of success, we tend to default to being OVERLY CONSERVATIVE, thus the permission to spend problem.
• Why You Should Care About the problem
  • The goal of saving all those years is to maximize your satisfaction later in life - to rely less on work and more on savings to support the activities you want in life.
  • Shift retirement from fear to fun
• What contributes to the problem
  • Psychology
    • The fear of running out of money
    • The “paralysis” that comes from having too many things to consider but no great way to prioritize them
  • Terrible “one size fits all” information
    • The 4% rule
    • ROTH conversions for everyone!
    • Social Security at age 70 is ALWAYS the best!
    • ACA subsidies because it’s free money!
    • Taxes are ALWAYS bad
• How to solve the permission to spend problem
  • Proper financial planning and education
  • The educational process of building a plan (with the right guidance) hypertrophy your “distribution” or “pay yourself” muscle
  • The educational process of building the plan and reviewing scenarios will help you appropriately determine if and which of the “one size fits all” information ACTUALLY applies to you.
  • The if-than, or contingency plans will help remove the decision making friction
  • The plan itself will help you prioritize the never ending set of action items or optimizations that can be done.
  • Documenting and reviewing the plan regularly with a set cadence that you commit to (not too frequently, not too infrequently) will help prevent you from making impulsive (fear based) decisions and help you make decisive (confidence based) decisions.

If you found this episode helpful, subscribe so you don't miss any future episodes.

Also, I'd greatly appreciate it if you gave a rating and review. It helps other people just like you find the podcast and benefit from discussions on these topics as well.

Eric Amzalag, CFP®, RICP®

_ _

Want help with your Retirement Plan?

Schedule a free consultation

Email me: [email protected]

Visit my Youtube Channel

#retirement #howmuchtoretire #retirementplanning #rothira #rothconversion #investing #401k #socialsecurity