The Retirement Solutions Show

On this week's podcast episode, we're digging into three powerful tax strategies you can use to reduce your tax obligation in retirement.

Tax strategy is a crucial component of retirement planning that is often overlooked. Some retirees see tax planning as hard, overwhelming, and stressful. On the other hand, many retirees simply don't realize the tax-reducing opportunities available to them if they make some strategic tweaks to their plan.

Ralph Hicks, Michael Hicks, and Ryan Gilmore reveal three of the most common tax-reducing strategies in this episode, including:

1. The Bucket Strategy
2. Roth IRAs and Conversions
3. Qualified Charitable Distributions

They also discuss:

• [00:51] Why the Retirement Solutions Show transitioned from radio to podcasting
• [02:14] How the emotional response to tax planning can leave you feeling stuck
• [04:00] Why you should care about building a tax strategy into your retirement plan
• [05:55] Understanding how your retirement accounts are taxed
• [07:42] How, when, and why you might utilize the Bucket Strategy, Roth Conversions, or Qualified Charitable Distributions
• [15:03] David Hick's' latest webinar, Protect Your Retirement Savings From Uncle Sam, which is all about how to build a tax strategy in retirement

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Links mentioned in this episode:

• Free Tax Planning Online Class
• The Retirement Solutions Show on Spotify
• The Retirement Solutions Show on iTunes
• The Retirement Solutions Show on Stitcher

This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax advice. You should consult your own tax advisors and accountants regarding your specific situation.

This week, we come to you with a Best of Show episode. This episode is compiled of our most popular and most talked-about segments in 2019. Enjoy!

Topics discussed:

• [1:05] How to build an income generation plan
• [5:29] The pros and cons of moving near or in retirement
• [14:27] How to know when it's time to walk away from the workforce
• [21:29] Social Security planning
• [28:05] Utilizing safe income in your retirement plan
• [33:16] Is $1 million enough to retire comfortably?
• [36:20] Paying for medical expenses in retirement
• [44:58] Retiring on your own terms
• [49:01] How to reduce taxes in retirement

In this episode, we celebrate Father's Day by sharing some of the financial wisdom we learned from our dads. We also share some advice for the working fathers who are in need of some financial guidance.

Then, we have a conversation about common retirement fears and how to overcome them, as well as how to transition from saving money to generating income in retirement.

Topics discussed in this episode

• [1:21] Financial advice learned from our fathers
• [7:23] Common retirement fears and how to overcome them
• [17:10] How to generate retirement income from your nest egg
• [23:28] Signs that it's time to retire
• [25:00] Building a financial plan that gives you permission to spend money in retirement
• [29:38] How much money you should have in the market based on your age
• [35:17] How to prepare and pay for future medical expenses in retirement
• [41:32] How often you should pay attention to the stock market
• [46:52] When too much good news about the economy is bad for our 401(k)

Resources

• Retirement savings: How to translate your nest egg into monthly income
• The Financial Planners Teaching Frugal Retirees to Live It Up
• 401(k) investors: As markets and the economy surge, some experts fear a downfall

There's a huge difference between having a retirement plan in your mind vs. on paper. Having a written plan gives people more retirement confidence and a greater sense of control. Yet, according to a Fidelity survey, only 18% of Americans have a written plan.

On this new episode of the Retirement Solutions Show, the team at Oakmont Advisory Group discusses why lacking a written financial plan could be a drastic mistake.

Topics covered in this episode:

• [8:52] 1/3 of baby boomers say don't have a Social Security claiming strategy because it's too confusing. But how you decide to claim Social Security is one of the most important financial decisions you make. We share how to start building a strategy and an example of how we help clients uncover additional benefits.
• [17:00] Many people mistakenly assume that Medicare will cover more than it does. Though it may cover doctor visits, it doesn't pay for long-term care. We discuss how you can fund possible long-term care using your assets. Plus, we explain the elusive 5-year Medicaid look back period.
• [23:15] It is critical for spouses to be on the same page in retirement, especially since money is cited as the #1 thing couples argue about. We share the financial questions spouses should be asking each other and the biggest financial differences we see when we meet couples in the office.
• [32:02] When it comes to our retirement savings, we can't risk making mistakes. We discuss some of the most common nest egg mistakes we see, including contributing too much to the wrong type of account.
• [38:44] New analysis from the Bank of America and Merrill Lynch declares the 10-year old bull market is dead. What changes are coming to the market and how will our retirements be affected?
• [41:20] For some of us, the word "retirement" is not in our vocabulary. But you still need to have a plan for retirement to protect us against the unexpected. We discuss how the planning process might differ for someone who never wants to retire vs. someone who's ready to exit the workforce.

When it comes to stock market losses, we at Oakmont generally follow one golden rule: don't panic. Even USA Today says the market correction we had at the beginning of the year is no big deal. Still, it is human nature to feel rattled when the markets take a plunge. 

On this new episode of the Retirement Solutions Show, we share the advice we give clients who are worried about their portfolios and how to know when it's time to take action.

Topics discussed in this episode:

• [3:17] How can you worry less about stock market losses? We share the advice we give clients who are nervous about their portfolios. Having a purpose for your money and knowing how your accounts will act in certain market conditions is key.
• [8:02] How fear-based news outlets can negatively affect your portfolio
• [12:18] How to ensure your numbers make sense before you walk away from the workforce
• [19:28] Advice for self-investors & when a self-investor might consider seeking the help of a financial advisor
• [24:02] We dispell common myths about estate planning and explain the difference between wills, trusts, and beneficiary designations.
• [30:38] Tips for reducing taxes on your Social Security benefits
• [36:22] How much income will you need to live the lifestyle you want in retirement? We share how to turn your savings into an income generation plan.
• [41:00] How downsizing or relocating could impact your retirement savings

According to a survey by Charles Schwab, people spend more time planning their vacations than they do evaluating their retirement. 

Why do so many people have their retirement priorities backward? 

For one, it’s a lot more fun to plan a vacation than it is to think about retirement. Additionally, it’s a lot easier to plan a 2-week vacation than it is to plan for a 20-30 year block of your life.

In the first segment of this week’s show, the guys at Oakmont spend some time evaluating common reasons why people avoid retirement planning and the lasting impact it could have on your future.

Topics covered in this episode:

• [7:24] How might sequence of returns in the market affect my retirement? While there is no good time for a market downturn, it can be especially bad if it happens early in your retirement. We discuss how you can structure your portfolio to reduce market risk.
• [12:42] How will you pay for healthcare in retirement? Though some expenses will go down in retirement, others will probably go up... like healthcare. We asked some of our listeners how they're planning to pay for their healthcare costs in retirement and their answers might shock you.
• [18:10] What are the downsides of the "set it and forget it" strategy? Changing goals, emotional responses, and sequence of returns, to name a few.
• [26:52] Why are people afraid to meet with financial advisors? Though many fear a financial advisor will make them feel stupid, we prefer to educate our clients and help them understand their financial position.
• [33:42] Why don't more people complain about the fees they're paying on their retirement accounts? We share why people don't understand the fees they are paying on their accounts.
• [40:13] How do we come up with a more accurate idea of how much we'll need in retirement? With 46% of us just guessing about how much we'll need, it's time for a change.
• [44:46] How can you make your income last as long as you do?

On this new episode of the Retirement Solutions Show with the Oakmont Advisory Group, a new Retirement Mindset Study by Fidelity Investments reveals the changing attitudes Americans have toward retirement.

Though many of the surveyed bunch claims to feel confident about their current financial health, they lack confidence in their retirement plan. In the first segment of this week's show, the team dissects the Fidelity study, explores the cause of this spike in financial confidence, and examines a change in top concerns amongst retirees.

What you'll learn from this segment:

• [1:39] 62% of respondents feel confident about their current financial health. This is likely due to the positive market performance in the last year. Despite this positivity, 75% of respondents range from feeling only somewhat confident to not confident at all about their retirement finances.
• [5:05] According to respondents, the #1 retirement concern for respondents is rising healthcare and long-term care costs. 38% of respondents identified this as their #1 concern, followed by Social Security benefits (28%), and inflation (10%).
• [8:44] You can lose financial progress very quickly due to medical costs. Case in point, the average couple spends $285,000 on healthcare costs after age 65.

Related: The Healthcare Hurdle: What You Need to Know If You Retire Before 65

More key takeaways from this episode:

• [12:29] What is your investing style? Jack Otter, an associate publisher for Barron's, claims that most of us fall into one of two extremes... conservative or risk taker. Both of these investing styles are wrong because they don't allow for your retirement plan to be custom fit to your situation. So, how do you create a custom fit? The simple answer: it's hard. For the long answer, listen to this segment of the show.
• [21:09] How can you protect your money from taxes? The team at Oakmont sheds light upon taxes in retirement. A Roth Conversion could be the answer. This is the process of moving money from a Traditional IRA to a Roth IRA. Though the conversion is a taxable event, it could lead to great tax savings if timed correctly.
• [27:25] Will you be able to retire on your own terms? It can happen, but certainly not without a plan. And according to Fidelity's Retirement Mindset Study, 79% of boomers are without a plan for retirement. We share how we can meet you where you are and help get you on track for saving for retirement.
• [35:14] Where will your paychecks come from in retirement? More people are looking toward annuities for "income for life." We explain the different types of annuities and how they've evolved into better financial tools over time.

Related: What Are the Different Types of Annuities?

• [41:57] Have you stress tested your retirement plan lately? MarketWatch says anyone considering early retirement should do this first. We share how we help clients stress test their retirement plan.

Links mentioned in this episode:

• Fidelity Investments' Retirement Mindset Study
• Opinion: Thinking of retiring early? Stress-test everything first

 

On this episode of the Retirement Solutions Show, the team of financial planners at Oakmont discuss US China trade and how we should react to the news about the new tariffs.

As we continue to read breaking headlines about the negotiations, it's crucial that we have the emotional steadiness to get through this without making any irrational, emotional decisions with our money.

 

What you'll learn from this segment:

• [1:36] David Hicks reminds listeners that a deal will happen. It's just a matter of how long our money will be held hostage to these negotiations. Times like these can play with our emotions, and it is important to trust your plan and not make emotional decisions with your money.
• [3:40] We consider Warren Buffett's comments on the possibility of a trade war.
• [5:17] Could inflation be a byproduct of the trade negotiations?

More key takeaways from this episode:

• [9:24] Blackstone CEO Stephen Schwartzman says he's expecting markets to start cooling off. We share how we help position clients so they don't have to worry about the constant ups-and-downs of the markets.
• [12:55] When you come into a large sum of money, it's important to pace yourself. We share client stories that illustrate this point.
• [18:44] We discuss some of the financial decisions our clients wish they could take back or do over. Most of them involve early withdrawals from retirement accounts and inconsistency with their saving habits. We also touch on a few timeshare horror stories.
• [25:39] David shares why it's important to find a balance between saving money and enjoying your money.
• [29:54] Are you doing enough to prepare for retirement? Blackstone's Tony James tells Fox Business that most of us are not. We share how we help people who got a late start plan for retirement.

• [34:36] Attorney Matt Danner joins us to discuss why it's important to think about getting an actual estate plan. He also shared why Transfer on Death designations rarely ever work.
• [45:55] Few people understand how Social Security spousal benefits work, so we break it down for you. We also share some tips for maximizing your Social Security benefit.

If you enjoy listening to the Retirement Solutions Show, please consider leaving a review on iTunes or Stitcher and let us know what topic you want us to cover next. It only takes one minute!

On this new episode of the Retirement Solutions Show, the team at Oakmont discusses the future of Social Security.

Federal officials are warning that our Social Security Trust fund will run out of money in 2035. Being only 16 years away, a lot of our listeners will be collecting their benefits by then.

In our first segment, we discuss how this warning might affect current workers and retirees. We also share how younger workers can prepare for the possibility of receiving a significantly reduced benefit.

Here's what you'll learn from this segment:

• [2:29] Around 20 million households have nothing but Social Security to carry them through retirement. There's no doubt that shortfall would have devastating effects on the people who rely on their benefit as their sole source of income. It could be time to start planning outside of the Social Security cocoon. We share ways to understand your budget and expenses and how you can find more cost-efficient versions of the things you enjoy.
• [5:58] 2035 is only 16 years away. That means that anyone below the age of 52 today is on track to receive only 70% to 80% of their scheduled benefits. Additionally, people who are retiring in 2019 at age 62 will see benefit cuts kick in at age 78. We share advice for these groups who may not receive their full scheduled benefit.
• [7:00] Fear plays a huge factor in retirement planning. Often times, it leads people to kick the can down the road and inhibits people from planning at all. We share how we help alleviate fear so that people can plan for a successful retirement.

More key takeaways from this episode:

• [9:04] A recent Kiplinger article talked about the different kinds of "safe income" you should have in retirement. What does it really mean to say that one type of income is "safer" than another? Can we trust the institutions that offer this type of deal?
• [11:10] The 4% withdrawal rule is a rule of thumb we hear about how much money you should take from your retirement account each year. Does this rule really work?
• [15:55] Forbes magazine claims that $1 million isn't enough to fund a 30-year retirement. We share a client scenario where $1 million was more than enough and another where $1 million would've run out in the blink of an eye. This goes to show they every situation is different.

• [34:04] Matt Danner the estate planner joins us to discuss why the fear of mortality can sometimes cause people to avoid the estate planning conversation.
• [44:41] A new report from United Income finds that the number of people choosing to work past traditional retirement age has doubled since 1985. The study cites inadequate savings, disappointing Social Security benefits, and high health care costs as the main reasons. Some people need to work past 65, but we share how we've helped people who have enough money, but keep working because they're not sure that they do.

• [48:45] There are a number of strategies we can use to reduce our tax burden when we retire. We share why you should have a tax strategy that benefits you, not the IRS and how you can start repositioning your accounts.

Links mentioned in this episode:

• The 2019 Annual Report of the Board of Trustees of the Federal Old-Age and Survivors Insurance and Federal Disability Insurance Trust Funds
• How to Boost Retirement Income by Making It Safer
• Why Retiring On $1 Million Isn't As Good As It Looks
• America's Elderly Are Twice as Likely to Work Now Than in 1985

If you enjoy listening to the Retirement Solutions Show, please consider leaving a review on iTunes or Stitcher and let us know what topic you want us to cover next. It only takes one minute!

If you're nearing retirement and there was one mistake you could correct that would improve your chances, would you want to know what it was? Probably! According to The Street, the most common mistake people are making is failing to have a plan.

We've said it before, but we'll say it again... you need to have a retirement plan. In our first segment of this week's show, we share why creating a plan is much more involved than you might think.

Does your retirement plan grow with you? Does it make mid-course corrections? Does it account for more than just a savings plan? If not, you'll want to tune in.

Here's what you'll learn from this segment:

• [1:34] When we need a haircut, we visit a barber. When we need help with our lawn, we hire a landscaper. Generally speaking, when we need help, we hire an expert, because it makes our lives easier. Why is it, then, that so many people hesitate to seek help from a financial planner?
• [3:52] Some believe they can sit down, talk about their intentions, and call it a retirement plan. It's much more involved than that. Ralph identifies the one dozen plus items your retirement plan needs to account for.
• [6:08] Is retirement planning a task you can realistically handle on your own?

More key takeaways from this episode:

Why people dread financial planning

• [9:31] One in four people surveyed by Goldman Sachs said they'd rather go to the dentist than deal with their financial planning. Why do so many people dread it so much?
• [10:37] Is your pride getting in the way of your retirement success? Often times, we find that people are too prideful meet with an advisor and admit they have no clue what they're doing.
• [13:10] Having a random assortment of investments is NOT a financial plan.

Planning for the future when we don't know what's in store

• [18:00] Mick Jagger is 75, a vegan, and works out 3 hours a day. On the other hand, Keith Richards is 75, not a vegan, and well, the pictures speak for themselves. Guess who ends up having heart surgery? Mick! This just goes to show that none of us know what's in store when it comes to our health and other areas of our life that might impact our financial future. How can we be prepared?

• [20:35] When you slow down and take a deeper look at your future, more specific concerns start to surface.
• [22:03] When it comes to your longevity, your attitude matters.

What should you look for in a financial advisor?

• [23:00] It's human nature to want to work with someone you like, but that's not enough. In fact, if likability is all your advisor has to offer, that's a problem.
• [26:00] You want your advisor to be likable, but you also want them to be honest. Ralph discloses some of the hardest, most honest conversations we've had to have with our clients.

Can you trust Consumer Price Index charts?

• [29:03] According to an article in Forbes, you can't rely on government inflation numbers when developing retirement and spending plans. The guys share why you should assume your inflation rate will be higher than predicted.

Estate planning pop-up clinics

• [34:05] Attorney Matt Danner explains how his upcoming Estate Planning Pop-Up Clinics eliminate some of the barriers that prevent people from creating an estate plan.

Do you need a financial plan if you don't plan to retire?

• [44:14] People who don't think they'll ever retire often don't take the time to create a plan. This can be a huge mistake! The guys discuss why you should make a plan with "What If?" scenarios just in case you should need it.

The American Dream is changing

• [47:20] The "American Dream" used to be having a nice long career and saving enough to retire at 65, without ever having to worry about money again. It's not that simple anymore. Your retirement is not your parents' retirement, and your longevity isn't the same either. The guys share advice on achieving the new American Dream.

Links mentioned in this episode:

• Keeping Finances at Arm’s-Length? You’re Not Alone
• The Big Retirement Planning Mistake You Want To Avoid
• A "New Era" Of Retirement: This Is What It Means For You

Do you enjoy listening to the Retirement Solutions Show? Please consider leaving a review on iTunes or Stitcher and let us know what topic you want us to cover next. It only takes one minute!