The theme this week on the One Minute Retirement Tip podcast is: improving your credit score after age 60

Today, I’m talking about why your credit score still matters in retirement. I think a lot of people think that once they enter retirement that their credit score doesn’t matter so much anymore. If you’re retired, you hopefully have less debt and anecdotally, I just find that the average 65 year old cares far less about their credit score than the average 35 year old. 

But there's a good reason to still care about your credit score in retirement. It still matters for a lot of reasons. Here are just a few benefits of a really good credit score that you may still care about in retirement, according to a blog post from CapitalOne (link to post: https://www.capitalone.com/learn-grow/money-management/benefits-of-high-credit-score/):

1. An excellent credit score can help you get a better rate on your car insurance, home insurance, and other types of insurance. That’s because insurance carriers use your credit reports to help decide whether to approve your application and how much to charge you. Once you’re a customer, they may check your credit to help decide whether to raise your premiums or even deny you the chance to renew your policy.
2. Qualify for a better interest rate - you’ll probably still have some need for access to credit and debt in retirement and an excellent credit score can save you tens of thousands of dollars, since you’ll qualify for a better interest rate. 
3. If you want to apply for a new credit card, like one with those nice perks that all you retirees love, like free companion fares on travel, good credit may also play a role when applying for a new credit card, helping you secure better benefits and rewards. 
4. An excellent credit score is essential for getting approved for higher credit limits. I don’t know about you, but I take comfort in knowing that my credit limit has been increased. BEcause even if I don’t ever think I’ll max it out, there’s security in knowing that I have access to additional funds if I ever need it. This is probably the biggest benefit for retirees who don’t carry much debt - just the added security of having access to additional funds if the need arises. And using less than 30% of your available credit is essential for a good credit score. 

There are other benefits as well, but I think these are the ones that matter the most for retirees, and with 4 big benefits on this list, it means you still have plenty of good reasons to care about your credit score in retirement.

That’s it for today. Thanks for listening! My name is Ashley Micciche and this is the One Minute Retirement Tip. 

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Tags: retirement, investing, money, finance, financial planning, retirement planning, saving money, personal finance

Welcome to a new week and a new theme here on the One Minute Retirement Tip Podcast. I’m your host Ashley Micciche, co-owner of True North Retirement Advisors, an independent financial advisory practice managing $300 million in client assets. I’m a Chartered Retirement Planning Counselor, a frequent speaker, radio and podcast guest, and I love talking to anyone who will listen about making a plan for the retirement you envision. 

The theme this week on the One Minute Retirement Tip podcast is: Improving Your Credit Score After Age 60.

The idea for this week’s theme comes from a loyal listener of the One Minute Retirement Tip. This listener writes: Here is my situation. I am 53 years old. I have paid off numerous car loans. I have paid off numerous credit cards. I have paid off my house mortgage.  I currently have a net worth of about $1.6 million. I’m  still working, not yet retired. I have two credit cards. Each has a $10,000 limit. One of my credit cards has a $3500 balance and the other credit card has a $9000 balance. My current credit score  is 725. This seems awfully low for someone with a credit history such as mine.  

Thanks to this listener for submitting this question for this week’s theme. I think I know why his credit score is lower than he thinks it should be, and I also have a solution that could be a quick and easy win to raise his credit score. Stay tuned, because on Friday’s episode, I’ll give my answer to his question. 

You too can send me your questions to be featured on the podcast - just send me an email to [email protected]. At the very least I will respond to your question via email, and if I think it has broad application to the podcast audience, your question may even be featured in a weekly theme on the podcast. 

Other than answering this listener’s question, I’ll also share with you why your FICO score still matters in retirement, the 5 factors and their weightings that determine your credit score, how to boost your credit score by focusing on credit utilization and your payment history, and lastly, why thanks to some recent legislation now under consideration in Congress, why your FICO score could be in for a complete overhaul. 

So whether you’re looking to get approved for higher credit limits, refinance your mortgage in this low interest rate environment or just save money on your home insurance, nearly all of us can benefit from a better credit score...and I’ll show you how to boost yours this week. 

I hope what I have to share with you this week will help you make smart and thoughtful decisions with your retirement. And while I am careful to not lead you astray, personal finance is not an exact science. There is no one-size-fits-all solution for everyone, so I encourage you to disregard anything I say that may not be helpful for you, and to consult your own financial, tax, and legal advisors regarding your own individual situation. 

That’s it for today. Come on back tomorrow, where I’m talking more about why your FICO score still matters (big time!) in retirement. 

Thanks for listening! My name is Ashley Micciche...and this is the One Minute Retirement Tip. 

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>>> Subscribe on Apple Podcasts: https://apple.co/2DI2LSP

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>>> Visit the podcast page: https://truenorthra.com/podcast/ 

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Tags: retirement, investing, money, finance, financial planning, retirement planning, saving money, personal finance

It’s Sunday, which means...It’s recap time! 

The theme this week on the One Minute Retirement Tip podcast was: How To Rebalance Your Investment Portfolio.

Rebalancing your portfolio is one of the most important aspects of investing, critical for stabilizing your portfolio, minimizing risk, and research shows that it can also enhance your long-term returns. I hope that I helped you understand not just why you should re-balance (ahem - right now!), but also how to actually rebalance your investments. 

Tomorrow, come on back, because we’re starting a brand new theme: I’m talking about credit scores. What drives your credit score and why good credit is important as you approach retirement. 

Thank you so much for listening this week! Please leave a review on Amazon, Apple Podcasts or wherever you listen to podcasts. I really appreciate your comments, and reviews also help new people discover the show.  

My name is Ashley Micciche and I hope you have a blessed Sunday.

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>>> Subscribe on Apple Podcasts: https://apple.co/2DI2LSP

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>>> Visit the podcast page: https://truenorthra.com/podcast/ 

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Tags: retirement, investing, money, finance, financial planning, retirement planning, saving money, personal finance

The theme this week on the One Minute Retirement Tip podcast is: how to rebalance your investment portfolio. 

Today, I’m talking about my process for rebalancing and how I approach rebalancing with client accounts. I have rebalanced client portfolios thousands of times over the last nearly 14 years that I’ve been managing money for clients. This is just one method for rebalancing. It’s my method and I think it works quite well, otherwise I wouldn’t do it. I like having the control over when and how to rebalance, so it’s a manual process. 

Here’s how I rebalance:

1. First I look at the overall portfolio allocation. If the client’s portfolio has drifted more than 5% away from the target allocation, it’s time to rebalance. For most of the last 3 years, that’s meant selling stocks and moving more to bonds. I determine the $ amount of how much I need to sell to get the portfolio back in balance. 
2. Let’s assume that figure is $60,000 - now I go to work across the accounts and look at which positions to sell. Most of our client portfolios are custom, so depending on how much I need to sell and in what accounts, I may sell evenly across the portfolio or pick and choose. 
3. If I’m selling evenly, it’s a simpler choice. Sell $60,000 in this account and move to bonds. I know what you’re thinking....”yuck! Bonds?!” Yeah, me too. Honestly right now, it’s the worst time in my 14 year career to be investing in bonds. Nothing looks appetizing. But when a portfolio has drifted too far, it’s the right thing to do. If you want some ideas on what types of bonds you should consider now, I have some episodes from earlier this year that cover that topic in detail. 
4. If I’m picking and choosing what to sell, then there’s a more complicated decision making process involved. What are the tax implications? Is there a concentrated position or an investment with lackluster future growth prospects? Is there an investment that is no longer appropriate for the client that should be sold anyways. The goal is to rebalance the portfolio and set up the portfolio for future growth, diversification, and an overall mix of stocks and bonds that’s consistent with the clients age and stage in life. 

Sometimes - especially these days - it may take some convincing to talk a client into moving more into bonds when the stock market is doing so well and bonds are flatlined. It requires discipline, but it’s the prudent thing to do, especially when you’re close to retirement or living in retirement. 

That’s it for today. Thanks for listening! My name is Ashley Micciche and this is the One Minute Retirement Tip. 

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>>> Visit the podcast page: https://truenorthra.com/podcast/ 

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Tags: retirement, investing, money, finance, financial planning, retirement planning, saving money, personal finance

The theme this week on the One Minute Retirement Tip podcast is: how to rebalance your investment portfolio. 

So far this week, I’ve focused on manually rebalancing your portfolio - determining your target allocation and rebalancing when things get too far out of line. By the way, if you want to know the target allocations that I recommend as a starting point based on your age, just send me an email - [email protected] and I will send you my age-based asset allocation cheat sheet. 

But what if there’s an easier way - what if you didn’t have to fuss with rebalancing your portfolio? Well the good news is, especially if you have a 401k, you can set up automatic rebalancing on your portfolio. 

If you own target date or a portfolio model (like an aggressive, moderate, or conservative model) - the rebalancing is done for you. Even if you prefer to customize your portfolio, you can still set up automatic rebalancing. My 401k plan is customized with a handful of different options. I have the auto-rebalance set up to rebalance quarterly. Most plans allow for this, and there is no guarantee that it will improve your returns, but it will ensure that your portfolio risk stays in check, and there’s strong evidence that it's likely to enhance returns over long periods of time. So I encourage you to utilize automatic rebalancing when it’s available to you, especially in retirement accounts where there are no taxes for rebalancing. 

That’s it for today. Thanks for listening! My name is Ashley Micciche and this is the One Minute Retirement Tip. 

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>>> Subscribe on Apple Podcasts: https://apple.co/2DI2LSP

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>>> Visit the podcast page: https://truenorthra.com/podcast/ 

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Tags: retirement, investing, money, finance, financial planning, retirement planning, saving money, personal finance

The theme this week on the One Minute Retirement Tip podcast is: how to rebalance your investment portfolio. 

Today, I’m talking about something that might be holding you back from rebalancing your portfolio like you should, and that is taxes. 

When you have money in a 401k or an IRA, rebalancing your portfolio is a much less complicated decision. There are no taxes to consider with rebalancing your investments in these types of accounts, and the fees for rebalancing are often quite low...even $0 if you’re rebalancing in your 401k.

Where things get more complicated is in your taxable accounts. This could be a trust account, a joint account, or a regular brokerage account. When you rebalance your portfolio in a taxable account, you must consider the tax consequences.

If you’re selling investments with big gains, the tax consequences can be significant - thousands if not 10s of thousands of dollars, and possibly much more. The prospect of paying capital gains taxes can cloud your thinking and good judgement when it comes to rebalancing your portfolio. After all, no one likes to pay taxes. I just sold off part of a client’s stock position last week that currently makes up over ⅓ of her investment portfolio. Her deceased husband bought the stock about 20 years ago, and the stock has gone gang-busters over the last 5-10 years. Her cost basis in the stock is extremely low, so she will owe thousands of dollars in taxes for selling just a portion of the stock. It’s like a shot of vinegar in your mouth when you’re retired, since your income is usually lower and it’s more burdensome to pay the extra taxes on selling. 

But over ⅓ of her portfolio is in this stock, and in my opinion, she would be much better off in the long-run selling a portion of the stock this year, paying the taxes from the proceeds of selling the stock, re-invest the remainder and having a portfolio that is less risky.

The way I look at it is: Never let the tax tail wag the dog. Taxes are an important consideration, but it shouldn’t be the primary factor in your investment decisions. 

That’s it for today. Thanks for listening! My name is Ashley Micciche and this is the One Minute Retirement Tip. 

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>>> Visit the podcast page: https://truenorthra.com/podcast/ 

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Tags: retirement, investing, money, finance, financial planning, retirement planning, saving money, personal finance

The theme this week on the One Minute Retirement Tip podcast is: how to rebalance your investment portfolio. 

Hopefully yesterday I convinced you to look seriously at rebalancing your investment portfolio right now. Assuming you’re persuaded, what’s next? There are multiple ways to approach re-balancing, so today I just want to share with you my preferred method, which is all about your target stock allocation. In other words, what % of your portfolio should be in stocks right now compared to your actual % in stocks?

Don’t know your target allocation? If you send me an email to [email protected], I’ll send you my age-based asset allocation cheat sheet that will help you figure out what % in stocks is ideal for your age. 

So let’s say your ideal allocation is 65% in stocks, but you haven’t rebalanced in a couple years and now your 75% in stocks. That’s 10% higher than what you should be. So you would need to figure out how much of your stock portfolio you should sell to get back to your 65% target, then determine what to sell to make that happen, and just do it. 

Having a target stock and bond mix and then taking action when your portfolio deviates more than 5-10% from that allocation gives you the discipline to buy low and sell high. Buying low and selling high evades most investors because they only focus on the investments themselves, not setting their target stock mix, which means they don’t take action to rebalance when they should. A portfolio that drifts too far from it’s target allocation is a riskier portfolio, and the longer you “let it ride” the more risk you take on - which isn’t a good thing if you’re getting close to retirement. 

Re-balancing your portfolio on a regular basis - typically anywhere from 1-4 times a year can enhance your long-term returns. A Vanguard Advisor Alpha study found that rebalancing enhanced returns by as much as .26% annually. It sounds like a small amount, but over 20 year retirement on a $1 million portfolio earning 6%, that’s a difference of $161,000. 

That’s it for today. Thanks for listening! My name is Ashley Micciche and this is the One Minute Retirement Tip. 

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>>> Visit the podcast page: https://truenorthra.com/podcast/ 

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Tags: retirement, investing, money, finance, financial planning, retirement planning, saving money, personal finance

The theme this week on the One Minute Retirement Tip podcast is: how to rebalance your investment portfolio. 

Today, I’m talking about why you should rebalance your portfolio...right now! As I record this episode, the stock market sits just below it’s all-time high. The temptation is to just let it ride...after all, why would you want to sell now when things are going so well and move into something else like bonds, which aren’t really making any money right now. 

I understand this temptation. It’s a conversation I have with clients all the time. But if you own stocks and you haven’t rebalanced your portfolio in the last 6-12 months, I can tell with you near 100% certainty that your portfolio is in need of some rebalancing. 

The old adage buy low and sell high is particularly true right now with the S&P 500 index up over 32% in the last 12 months. The stock market, like home prices, will not keep climbing forever. The time to rebalance is on the heels of a strong and sustained recovery, like we’ve had since the depths of Covid. 

Tomorrow I’ll get into the nuts and bolts of how to approach rebalancing...explaining how much you should consider taking out of stocks. I’m not talking big dramatic moves here - just taking some cream off the top and preserving some of these incredible gains that most of us have benefitted from over the last several years. 

That’s it for today. Thanks for listening! My name is Ashley Micciche and this is the One Minute Retirement Tip. 

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>>> Subscribe on Apple Podcasts: https://apple.co/2DI2LSP

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>>> Visit the podcast page: https://truenorthra.com/podcast/ 

----------

Tags: retirement, investing, money, finance, financial planning, retirement planning, saving money, personal finance

Welcome to a new week and a new theme here on the One Minute Retirement Tip Podcast. I’m your host Ashley Micciche, co-owner of True North Retirement Advisors, an independent financial advisory practice managing $300 million in client assets. I’m a Chartered Retirement Planning Counselor, a frequent speaker, radio and podcast guest, and I love talking to anyone who will listen about making a plan for the retirement you envision. 

The theme this week on the One Minute Retirement Tip podcast is: how to rebalance your investment portfolio. As I record this episode, the stock market is up more than 13% this year. And that’s coming off of an incredible recovery in the 2nd half of 2020. If you haven’t rebalanced your portfolio in the last year, I exhort you to listen carefully to this week’s episodes and scrutinize your current portfolio to see if it’s in need of rebalancing. One of the worst mistakes that you can make as an investor is letting it ride, especially in the good times. WE humans don’t like change. We like to stick with the comfortable status quo. That’s a problem when it comes to managing your investments, because too many investors don’t  take advantage of strong gains in the market, when they could lock in some of those gains by rebalancing, and stabilize their long-term returns. 

So this week I’ll share with you the benefits of rebalancing now, and why you want to rebalance your portfolio on a regular basis. We’ll talk about some roadblocks to rebalancing, how you can make rebalancing easier by automating it, and then lastly I’ll share with you my personal approach to rebalancing. I have rebalanced portfolios literally thousands of times with hundreds of millions of assets of client’s money, so I’ll share with you the thought process behind every rebalancing decision later this week. 

I hope what we have to share with you this week will help you make smart and thoughtful decisions with your investment portfolio. And whileI am careful to not lead you astray, I am not infallible.

Personal finance is complex, and there is no one-size-fits-all solution for everyone, so I encourage you to disregard anything I say that may not be helpful for you, and to consult your own financial, tax, and legal advisors regarding your own individual situation. 

That’s it for today. Come on back tomorrow, where I’m talking more about why now is an ideal time to rebalance. 

Thanks for listening! My name is Ashley Micciche...and this is the One Minute Retirement Tip. 

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>>> Subscribe on Apple Podcasts: https://apple.co/2DI2LSP

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>>> Visit the podcast page: https://truenorthra.com/podcast/ 

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Tags: retirement, investing, money, finance, financial planning, retirement planning, saving money, personal finance

It’s Sunday, which means...It’s recap time! 

The theme this week on the One Minute Retirement Tip podcast was: Retirement Tip Rewind. I shared my favorite episodes with you from this year & I hope you enjoyed the variety this week. 

In case you missed any episodes, here’s what we covered in each episode this week: 

• The number one thing you should do if you’re planning to retire in 2021
• Why you should consider value stocks now...especially if you’re close to retirement and worried about inflation
• I revisited an episode on why you can’t time the stock market when my dad was a guest on the show. 
• Then I talked about the bond investing mistakes I see over and over again
• And lastly, yesterday I shared with you why I don’t think it’s necessarily a good idea that retirees should pay cash for cars

Tomorrow, come on back, because we’re starting a brand new theme: How to Rebalance Your Portfolio. As I record this episode, the stock market sits just below it’s all-time high. If you stayed invested while the floor was falling out the bottom of the stock market during the Covid spring of 2020, you’ve no doubt enjoyed some nice returns over the last 16 months, making now an ideal time to look at rebalancing your portfolio. I’ll share with you how I do it with my clients next week. 

Thank you so much for listening this week! Please leave a review on Amazon, Apple Podcasts or wherever you listen to podcasts. I really appreciate your comments, and reviews also help new people discover the show.  My name is Ashley Micciche and I hope you have a blessed Sunday.

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>>> Subscribe on Apple Podcasts: https://apple.co/2DI2LSP

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>>> Visit the podcast page: https://truenorthra.com/podcast/ 

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Tags: retirement, investing, money, finance, financial planning, retirement planning, saving money, personal finance