Retirement Planning - Redefined

Understanding Estate Planning: Wills and Probate with Nicole Cleland (Part 2)

This episode, we welcome back estate planning expert Nicole Cleland to discuss important topics such as how property passes after death, the rights of spouses and blended families, challenges minors face when inheriting, and the benefits of avoiding probate. Whether you’re single, married, or navigating a complex family dynamic, this episode offers valuable insights to help you protect your legacy and plan effectively for the future.
 
Learn more about Nicole and Legacy Protection Lawyers
Contact info: www.legacyprotectionlawyers.com Phone 727-471-5868
 
Helpful Information:
PFG Website: https://www.pfgprivatewealth.com/
Contact: 813-286-7776
Email: info@pfgprivatewealth.com
 
Disclaimer: PFG Private Wealth Management, LLC is an SEC Registered Investment Advisor. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. The topics and information discussed during this podcast are not intended to provide tax or legal advice. Investments involve risk, and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial advisor and/or tax professional before implementing any strategy discussed on this podcast. Past performance is not indicative of future performance. Insurance products and services are offered and sold through individually licensed and appointed insurance agents.
 
 
Marc:
Time once again for another edition of Retirement Planning Redefined with John and Nick from PFG Private Wealth. And once again, we're going to continue our conversation with Nicole Cleland on estate planning. So really happy to have her back on this chat with us. And if you've got questions, need some help when it comes to the legal side of things, reach out to them at legacyprotectionlawyers.com. That's legacyprotectionlawyers.com. And of course, if you've got some questions on the financial side, reach out to John and Nick at pfgprivatewealth.com, pfgprivatewealth.com.
 
Nicole, welcome back in. Thanks for being here again.
 
Nicole Cleland:
Thanks for having me again.
 
Marc:
Lovely to talk with you. And John, my friend, thanks for being here as we continue this chat with Nicole. We covered a lot of stuff and I want to kind of circle back to a few pieces. We were talking about property, how it passes on death. Who should inherit your assets? I think that's kind of maybe a big question for people in general.
 
Nicole Cleland:
So this is what we call testamentary intent, meaning you can leave your assets to whomever you want. There is no restriction or requirement on who takes from your estate. However, most states, Florida included, has a law that says if you are married, you cannot disinherit your spouse. And sort of the philosophy behind that is if you had, back in the old days, husbands were the breadwinners, wife stayed homemaker. And if husband wanted to leave assets to someone else, his children, a mistress, something like that, the law would not allow you to disinherit that spouse. And that's sole control.
 
So the law presumes that spouses are meant to be taken care of and you cannot leave your spouse less than a certain percent. In Florida, that percent is 30%. So although you can disinherit the rotten children, you can't disinherit the spouse.
 
Marc:
Okay. I like that.
 
John:
So I'd also say this becomes very important when you have blended families. I'll say that.
 
Nicole Cleland:
Absolutely.
 
John:
Working with clients where it's second marriage, kids. This becomes a very important topic that I think most people I'll say that haven't gone through an estate plan or just haven't made that decision yet to go through it, have no idea this even exists. And also I've even talked to some pretty savvy attorneys that I've talked to and I mention it, like, "What are you talking about?" And they look it up and they're like, "I had no idea."
 
Nicole Cleland:
Yeah, it's one of those things that a lot of people don't realize because again, circling back to that testamentary intent, you should be able to leave your assets to whomever you want, but the law's not going to say that for a spouse. And you're right on the money there, John, with the blended family situation.
 
And I usually try to even say it's not always that later-in-life marriage couple. So if you've got a husband and wife that get married later in life, they both have children from prior relationships, we usually find that they honor that testamentary intent, meaning, all right, husband, whenever you pass, you can leave your money to your children and then I'm going to leave my money to my children. We don't need to leave anything for each other. We're getting married later in life. We've built our wealth so we don't need to support each other.
 
But what ends up happening is if my husband passed away and I'm still alive, I might be older and a little bit more vulnerable. And usually I find that it's the kids of the surviving spouse that end up saying, "No, mom, you're entitled to that elective share. You're entitled to that 30%. You need to pursue it." And it's usually the children of that surviving spouse in that blended marriage that end up trying to push for things that that married couple really had no intent to do.
 
Marc:
Is it easier or more complicated for folks on a... I guess if you've never had children and just you're single or whatever, do people feel like, "Well, I don't need any of this stuff because it's just me"? But you still have to leave your stuff somewhere, right?
 
Nicole Cleland:
Right. No, and I think it's where whether you're single, whether you're married, like I mentioned on our last podcast, I made a comment that everyone has an estate plan, you just may not know what it is.
 
Marc:
Right.
 
Nicole Cleland:
So a lot of people where let's say you have a young person who's working out in Silicon Valley, they graduated from an Ivy League school, they're making a ton of money out there, and they were raised by their mom but have no relationship with their father. In that instance, if that single individual passes away, not married, no children, their money's not going to go to the mom that raised them single-handedly. It's going to go 50/50. And I see that. I see those instances where you have money going to estranged family members, family members you had no relationship with because you just did not know what the law was going to presume you wanted.
 
Marc:
Yeah, that makes a lot of sense. And it gets really interesting because it's more complex than I think people realize, but yet it's also something simple to handle. You just need to get it done. And that's where making sure that you're checking off beneficiaries and all those things come into play as well.
 
John:
And I'll jump in here. Just I'd say that the biggest thing I think doing estate plan, and I'll say guilty where I didn't officially do one until my daughter, my first daughter was two, it was just kind of peace of mind that it was done. Because it was always kind of lingering there like, "Hey, you got to get this done." And finally when I did it was just like, "Hey, I'm good." And then we make updates to it. But it was a relief to get it done and know that my wishes would be taken care of if something happened to me and Jenny.
 
Nicole Cleland:
And I think that type of planning is very important for younger couples that do have children. You can name who you would want to have what I call custodial care for your child, who your children would live with if something happened to you and your spouse. But that also doesn't mean that has to be the same person that's managing the money. So you might have one person that decides whether your child goes to public or private school, whether they go to church or not, but then you can have someone else be the one to manage the checkbook, so to speak.
 
But the other thing that's wrecking havoc on our world a little bit is ancestry.com, believe it or not. We're having children that no one knew existed come to the forefront. So that's where planning could be even more important is you might have biological children that you did not know about.
 
John:
So I got to ask, I know this isn't a topic we were going to discuss, but how often is that happening and do those surprise kids, let's call it, have any rights?
 
Nicole Cleland:
Great question. So I've had it come up once, and it was in the context of what we call an intestate estate. So there are two different types of probates in the sense of who are your beneficiaries, meaning an intestate estate is a probate administration where the decedent had no will. So the law declares who your beneficiaries are, who your heirs are. A testate estate is a probate administration where you have a will. And so your will that you've created dictates the beneficiaries under your estate administration.
 
Most wills, at least I will say most good wills define who your children are. So for example, if I was creating a will for someone, I would say, "Okay, your children are A, B, and C. and for purposes of this document we're limiting your descendants or your children to those three kids."
 
Now, with an intestate estate, the one that I'm speaking of that we had happen is the family sort of was suspicious of this individual being a descendant. And after a paternity test, it was deemed true. But that didn't come to fruition until after the person had passed and the parent of this minor wanted to stake a claim in the estate. And they were successful because they were a biological child, even though there was no relationship at all, the child did not know the other family members. But they were an equal child to all the other children, even though they're technically half sibling. But it was a direct child of the decedent.
 
Marc:
Wow. Yeah, it gets a little sticky there. So we tend to think about that with celebrities or something like that. But I guess, yeah, it can happen anywhere.
 
Nicole Cleland:
Yeah, it really can. And it's not fun to manage because now as the attorney, I'm having to really make sure my clients understand, my executors or my personal representatives, I have to ask them, "Are you sure these are the only children of the decedent?"
 
Marc:
I'm sure you get, "What kind of question is that?"
 
Nicole Cleland:
Correct. Yeah, it's not a fun one, but it's something that I have to say, really make sure we've got the right heirs here.
 
Marc:
Yeah, that certainly, it was a great question by John. I didn't even think about that, kind of kids coming out of nowhere. And maybe this is one reason, Nicole, why people want to avoid probate amongst other reasons, right? Because if you're going to a trust or something like that, you have more privacy, correct? Where probate is out in the open.
 
Nicole Cleland:
That's correct. So trust administrations are typically private, meaning we don't file the trust anywhere. We don't have any sort of public record of the administration process. But probate is the opposite. We have to deposit your will with the court. The probate administration is all public record. So whenever you have a probate proceeding, we talked in our last session about how long it can take. I'm saying now the average is about 12 to 18 months. And a lot of that is, I think directly dependent on your fiduciary, your personal representative that you have serving in that role. Some of it is the court, but a lot of it is that person that you have named.
 
But a lot of people tend to shy away from probate administrations, not because it's necessarily public and not so much because of the delay, but the cost. The cost for probate proceedings here in Florida are statutory, which means there is a Florida statute dictating the schedule on what is deemed a reasonable fee for not just your personal representative but the lawyer.
 
And in Florida, 3% of the probate estate is deemed reasonable. So if you've got a million dollar investment account that needs to go through probate, and it could just be the one account, what would be presumed a reasonable fee under Florida law would be 3%, 3% for the lawyer and 3% for your personal representative. So just right there, you've got 6% coming from that million dollar account, $60,000 for a probate administration. So the cost can add up fairly quickly, especially the bigger and the more complex the size of the estate.
 
John:
Yeah. And I'll add to that just kind of personal experience. You don't know what you don't know. And I'll tell you that even though I'm somewhat in the industry, not an attorney, there's a lot of questions that I'm having for helping my wife be the executor of her father's estate. And it's like, "Hey, what about this?" So we're emailing the probate attorney quite a bit of just, "Hey, what about this scenario? What about this?" And there's a lot of nuances that I think the average person just is not aware of.
 
Nicole Cleland:
Absolutely. I think for most administrations, we always joke here in the estate planning world in the administration side is there's no easy probate. There's something new in every single probate administration that you have just because the family dynamic could be different, the type of asset that could be different. You could have what I would deem a very easy probate where the only thing we have to transfer title to is maybe the house. But let's say the house isn't selling. Let's say the mortgage is worth more than the house, or there's a special assessment on the condo or one of the beneficiaries doesn't want to consent to the sale. Something, anything can just come up at any time with a probate administration that can turn what I would deem an easy probate into a very, very complicated one.
 
And like John said, you don't know what you don't know, and sometimes you can't envision or foresee what's going to happen at the end of the probate proceeding. But surprises do often come along. And that's where I think sometimes experience can really matter in terms of the type of attorney that you pick because they're going to have experience dealing with this type of issue, this type of condo that's being sold or this type of family dynamic that's occurring or something like that.
 
John:
Nicole, how about something that comes up a lot with I would say Nick and I is minors. Minors that potentially could or have inherited money that maybe they were listed on a beneficiary account and the person didn't know the rules in Florida with minors inheriting money. How does that work?
 
Nicole Cleland:
Yeah, that is just not great planning, frankly. I think a lot of people who maybe don't have a lot of wealth or have young children, they name their minor children as a default, and it becomes really sticky very quickly. And even in the best of scenarios where let's say you've named your minor as the beneficiary on an account, and let's say we have to do a guardianship for that child because minors can't manage over a certain dollar amount, or let's say you even have a custodial account, even if all of those get teed up perfectly, at the end of the day when those minors inherit the money, they're 18 years old or 21 years old, or even 25 years old. And I don't know about you, but I don't see a lot of financially savvy or financially prudent 18-year-olds or 21-year-olds.
 
So it ends up being where even in best of scenarios, without proper planning for young kids, it's really hard for someone in their early twenties to inherit any type of money, not just a significant amount.
 
John:
Yeah, I'd say one thing we come across when we're doing initial consults, we'll do reviews of beneficiaries and we'll see minors as contingents. And that's where, going back to who needs an estate plan or why, I think people really need to take a look at that with kids.
 
Nicole Cleland:
They really do. Because that's the one where, again, even if we're able to do the guardianship for that minor or a custodial account or something, it just doesn't work well when you have a young person inheriting.
 
I've had a minor, no, actually take that back, they were an adult, inherit a life insurance policy, and I think they were 21, what the law presumes financially mature enough to inherit money. And this 21-year-old spent over half a million dollars in life insurance in a year.
 
Marc:
Wow.
 
Nicole Cleland:
And they had nothing to show for it at the end of that year, nothing. It was you almost felt guilty asking them what did you even spend that money on? Because they're just so young. And it wasn't necessarily their fault in the sense that that was not the planning that should have been put in place for that person.
 
Marc:
Yeah, their sneaker collection was amazing.
 
Nicole Cleland:
Yeah, I couldn't even say that. There was no collection to speak of.
 
Marc:
Oh, geez.
 
Nicole Cleland:
I have no idea where the money went.
 
Marc:
Really? Oh, no. Well, that's terrible. That's the importance, right? That's the importance of, and that's a great way to wrap up this episode, Nicole, the importance of planning for the individual, for the situation, just it's paramount. Right?
 
So get onto the calendar, have a conversation. If you need some help, reach out to Nicole and the team at legacyprotectionlawyers.com, that's legacyprotectionlawyers.com, or call them at 727-471-5868. That's 727-471-5868 to have a conversation about your situation. And of course, as always, don't forget to subscribe to the podcast, Retirement Planning Redefined with John and Nick. You can find that on Apple or Spotify. And of course, if you need to make it easy, just go to their website and get some time with them as well, pfgprivatewealth.com. That is pfgprivateweath.com.
 
Nicole, what does it look like if people want to reach out to you and the firm?
 
Nicole Cleland:
We would love for clients to reach out and ask to meet with one of our attorneys to get a little bit more of a specific recommendation as to their family and their situation. Everyone is different. There's no cookie-cutter approach to planning, and it's important that people talk to an attorney or a professional that can be a little bit more custom approach to their type of plan. So they can give us a call and we can offer a complimentary consultation to kind of go over that in more detail with them.
 
Marc:
All right, there you go. So thanks so much for listening to the podcast. We appreciate it. Again, reach out to them at legacyprotectionlawyers.com. That's legacyprotectionlawyers.com. And thanks for tuning in to Retirement Planning Redefined with John and Nick.
 

Understanding Estate Planning: The Fundamentals with Nicole Cleland (Part 1)

In this special episode of Retirement Planning Redefined, John and Nick welcome their first-ever guest, Nicole Cleland of Legacy Protection Lawyers, to kick off a new estate planning series. Nicole shares key insights into what estate planning really involves, who needs it (hint: it's not just for the wealthy), and how proper planning can help avoid confusion and conflict later. They cover the differences between estate planning and elder law, the importance of incapacity planning, and how assets actually pass after death.
 
Learn more about Nicole and Legacy Protection Lawyers
Contact info: www.legacyprotectionlawyers.com Phone 727-471-5868
 
Helpful Information:
PFG Website: https://www.pfgprivatewealth.com/
Contact: 813-286-7776
Email: info@pfgprivatewealth.com
 
Disclaimer: PFG Private Wealth Management, LLC is an SEC Registered Investment Advisor. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. The topics and information discussed during this podcast are not intended to provide tax or legal advice. Investments involve risk, and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial advisor and/or tax professional before implementing any strategy discussed on this podcast. Past performance is not indicative of future performance. Insurance products and services are offered and sold through individually licensed and appointed insurance agents.
 
 
Marc:
Once again for another edition of Retirement Planning Redefined with John and Nick from PFG Private Wealth, and we've got a special show this week. We're going to be talking about understanding estate planning. We've got a little series planned around this. We've got some special guests coming up also. So really looking forward to today's conversation. John's going to be joining me along with Nicole Cleland, who is our special guest from Legacy Protection Lawyers based outside of St. Petersburg, Florida. And we're going to have a great conversation around understanding those estate planning basics and some other details and information. So it's going to be an excellent episode, so stay tuned and we'll get right into it. John, my friend, how are you this week, buddy? What's going on?
 
John:
Hey, I'm doing all right. I'm excited to have Nicole as our first guest that we've ever had on our podcast here.
 
Marc:
Yeah, our very first guest here on this, so it's excellent to have Nicole here. Nicole, welcome in. How are you?
 
Nicole:
I'm doing great. Thank you both for having me. I'm really excited to be here today.
 
Marc:
Absolutely. So we'll jump in real quick. Just tell us a little bit about you and your firm, what you guys do.
 
Nicole:
Sure. So we are a boutique trust and estates firm, meaning this is all we practice is trust and estates. We do primarily planning, and secondary administrations of estate planning documents, and we also do a little bit of litigation and a little bit of tax planning as well. So we do have a trust and a estates only litigation lawyer and a tax lawyer with us too.
 
Marc:
Okay, excellent. And Bill McQueen is going to be joining us as well on probably the next episode, so we'll get into some conversation with him. But for now, let's just kick things off and get started. Although I do have to ask, I was looking at the website and I see that you are a super lawyer. What is a super lawyer?
 
Nicole:
Yeah, it means that we get a cape every year.
 
Marc:
Nice.
 
Nicole:
No, a super lawyer designation is a designation that you receive from other lawyers in the area and about 5% of practicing attorneys get this designation. So I'm very honored to have been a rising star super lawyer for seven years now, I think.
 
Marc:
Awesome.
 
Nicole:
And yeah, it's nice to know that the professionals that I work with enjoy working with us in our firm too.
 
Marc:
Yeah, that's great. John, you need something like that? You need super advisor or something.
 
John:
I don't know if there's a super advisor, but if there is one, I'm about to see how I can get that.
 
Marc:
There you go.
 
John:
I feel like got as much work as I do, I need a cape as well.
 
Marc:
There you go. Yeah, capes are good. Well let's get into our conversation here. So I wanted to kick things off with just a really simple question for you, Nicole, because a lot of people, I think it's probably changed through the years and you can maybe talk about that as well, but people, I think around estate planning, even financial advisors, tend to think that, well, this is for the ultra wealthy. Those kinds of things are for people that really have a lot of money, and I don't think that's the case. So explain, do you really need an estate plan and if so, why? Can you give us some kind of parameters and some breakdowns on that?
 
Nicole:
Yeah, that's a really great question. And I think a lot of people do think estate planning means you have to have a large estate, but that's really not all estate planning is, I kind of think of it as twofold, you've got planning on the incapacity side and then you've got planning on the after-death side. So you don't really have to have a lot of wealth, or really any wealth, to do estate planning, because if you're incapacitated, you might have very specific wishes on your care, whether that's through any sort of long-term incapacity, through any end-of-life care wishes, whether it's where you want to live, how you would like to be buried, things like that. So it's not necessarily always based around dollar amounts, and I'm sure you all see this and sometimes you have the most complex cases that really aren't the super ultra-high net worth people.
 
It could just be your run-of-the-mill, middle-class American that has very specific wishes in terms of they've got a blended family, or stepchildren, or maybe a child that has addiction issues. So it can really be more broad than, "Hey, I have all this money and I need a plan for taxes." It's really more complex than that.
 
Marc:
Gotcha. Okay. Is there a difference between estate planning attorneys and elder law? I think people get those confused as well.
 
Nicole:
Oh my gosh, yes, there is a difference. And that's a big one we get too. And for us, the estate planning is planning for... What I say is, you've got tax planning, you've got incapacity planning, asset protection planning, and kind of encompassing all of that, just your run-of-the-mill estate planning, meaning how you would want to plan for things after your passing. But elder law is a little bit more on the incapacity side and planning for one day potentially needing Medicaid, so thinking more of the disability planning. That's how I sort of equated in my mind is you've got an elder law lawyer that's a little bit more on the disability planning side, but a lot of elder law attorneys still do estate planning, but there is a slight distinction between the two and that is important to note.
 
Marc:
Great point. All right, good. What makes an effective estate plan?
 
Nicole:
Oh, that's a fun one too because I like to say the one that works is the one that we have no hiccups with after the testator, or the creator of the plan, has passed away. And that's sort of the hard part on estate planning is my best witness is no longer here to verify that this is what they wanted. So I would say that the best estate plan is one that you can keep family harmony at the end, as much as possible, at least preserve it or maintain that family harmony as much as possible, and administer and execute that settler or that testator's intent. Really kind of making sure that that is the theme throughout the whole administration.
 
John:
So Nicole, you mentioned incapacity, what type of planning goes into that because that comes up quite a bit with Nick and I's clients, where it's coming up where we'll talk about beneficiaries and the estate stuff, but I'll say the incapacity planning is not my strong suit. So I think from our listeners standpoint it'd be good to hear, what does that include?
 
Nicole:
Yeah, that's also a great question because a lot of people, when they think of themselves in the incapacitated context, they think of themselves more in, there was an emergency, I had a bad accident and now I'm on life support for a week and then I'm deceased and then I've passed. And the reality is that's not what happens to most people, especially as we're aging and living longer, more people are experiencing longer bouts of incapacity. And with that, a lot of family members don't really know what that person wanted, where they would've wanted to live, what kind of care they would've wanted to receive.
 
So when I'm talking to clients about incapacity planning, I try to tell them, don't think of yourself in the context of, "Oh, there was an emergency, I'm out for a week and then I'm gone. I want you to think of it as you've developed some sort of dementia, you've developed some sort of condition where we're going to have long-term incapacity.So when you're thinking about who should be making those types of decisions on your behalf, think about it in the context of you've just signed these people up for a part-time job, if not full-time job." When you're thinking of these individuals, a lot of people default to their children, which is usually best for most people, but it isn't for everyone. And I think it's important for people to sort of think of themselves, which is really hard to do in the situation that they've gotten, they will need long-term care, not the short-term one-week care, but really that long-term care piece, and it's really hard to think of yourself in that boat.
 
Marc:
That makes sense. And documentation has got to be crucial in all of this, right?
 
Nicole:
Absolutely. There's no statutory authority or person that can make any sort of financial or legal decision if you become incapacitated. There is a healthcare statutory order, but it's just spouse, then parents, then children, there's no one after that. So if you're an elder person with no children, not married, you don't have that default person, so it's really important that you do have documents in place. But for most people, whenever you're thinking of who to name in this role and what documents you should have in place, it's so important that you really have a robust plan and documents that really spell out all of the things that you want your named agent to do because there are certain types of statutory forms. So you can look on Florida Statute and just look online and find a statutory form for a living will, but if you present that form that was created by lawyers to a doctor, that doctor's not going to be able to honor that living will. It's not clear enough, it doesn't really express what someone's true intent might be.
 
So sometimes there is a disconnect between what the lawyers prepare and what the doctors are executing, or what the bank is executing under a durable power of attorney or something like that. And it's important you have a lawyer that's preparing your documents that knows both, that really can make the connection between the different areas of your life in any sort of end-of-life care incapacity situation.
 
John:
When you're meeting with clients, I'm assuming this comes up quite a bit, when someone's having an issue picking who their power of attorney or health care surrogate is, what kind of advice could you provide for that?
 
Nicole:
Yeah, great question too. I tell clients, think of two things when you're considering who you should name in these roles. And the first condition I say, is you want someone who's going to have the time because most people want to name their more intelligent child or, "This child is very smart, they're a doctor, they're a lawyer, they're going to know what to do. They're very smart." But those people typically don't have the time. They're too busy, they've got a family of their own, full-time career, other obligations outside of their job and family that even though they could probably do and be fine with it, they usually don't have the time that's needed to devote to something like this. So I always say, look for someone who's going to have the time. And then two, you're going to want someone who's going to know when to ask for help.
 
And I always tell clients too, is when we have people do things that are bad, it's not because they're a bad person. Most people aren't doing things to be evil or have any bad intent behind the action, but it's because they didn't know when, or they didn't want to ask for help. I think people still have that, "I want to save money, I don't ask the professional for help." Or, "I think I can do it. I don't need to ask all of these people for advice and things like that." And I think if you have someone who's going to know their limitations, then they're going to get advice, they're going to get opinions from people, and they're going to get a little bit more well-rounded approach on how to provide for mom or dad's care, or whatever it is, or whatever person that we've got here, making decisions on your behalf.
 
So I would say those two things is, someone who's going to have time, someone who's going to know when to ask for help, because again, it's not always our children, but usually it can be, but it's something where they really need to, if they're comfortable, have that conversation with that person. And that's sort of sometimes a hard conversation to have, especially if you have children that are, "I don't want to talk about it, we don't need to talk about this." But it's really important that you do talk about it because what you don't want is you don't want to name John Doe, and then when John Doe is being called to serve, he's completely taken off guard, he has no idea what to do, he's not prepared. So it's nice to kind of have these conversations with your prospective agents just so that they can start asking questions that they might need to know the answer to one day.
 
Marc:
Yeah, that makes a lot of sense. I mean, certainly you want to get people in the loop on these things and when you're setting up all your documentation and putting the basics together, I guess we should probably switch and talk a little bit about some of the assets then, because that's where people get confused and kind of wonder about the different rules that are in place. So how does property pass at your death? I guess we can start there.
 
Nicole:
Whenever someone dies, there's really three ways that property can be transferred. The first way is by operation of law, and a good example of that is if you own something jointly with rights of survivorship with someone. So for example, if I own my house joint with my husband, when I die, by operation of law, he will own the home. Nothing else has to occur. He doesn't have to record anything, that's his house.
 
The second way that property passes is through contract law, and a good example that would be a beneficiary designation. So if you've got a life insurance policy, you could have a contract with that company that says when you die, whatever the death benefit that life insurance policy would be, that would be paid to your named beneficiaries. Another example of a contract is A trust. A trust is a contract you have with typically yourself as trustee, and we could talk a little bit more about trusts later today too. But the third way that property passes is through probate, and probate is really just a fancy court-supervised process of transferring assets out of someone's individual name to your heirs. And if you have a will, then your will says who your beneficiaries are. But if you don't have a will, then the state of Florida tells you who your beneficiaries are.
 
So really rounding out, how does property transfer whenever someone dies? Those three things are in order of priority, so joint ownership usually supersedes beneficiary designations or other types of contracts, and then both of those items supersede your will. So a lot of people don't realize this, but your will only governs assets that go through probate, and your will would only kick in if you have probate assets. So that's why sometimes when we talk about estate planning, it may be where you really need to confirm with a professional what your estate plan is, because whether you have a will or not, you have an estate plan in place, you just may not know what it is.
 
Marc:
You have the state's plan, right?
 
Nicole:
Correct.
 
Marc:
Yeah, I was always taught, and tell me if this is accurate, that a will just means you will go through probate.
 
Nicole:
I love that. Actually, that's a great phrase there that I should probably start using.
 
Marc:
There you go. You're welcome.
 
Nicole:
Absolutely. Yeah. Your will only is going to govern those assets that have to go through probate, which if you've done other type of planning, you may not need probate, and so you may not need your will. There are, of course, other reasons to do one, but yeah, that phrase is right on point.
 
Marc:
You can jot that down.
 
John:
And Nicole, I think going to get onto some of this stuff deeper in the podcast or maybe next week, but something that always comes up, is how long does someone expect probate to last?
 
Nicole:
Yeah, really good question. I used to say most probates are anywhere from 6 to 12 months. Since COVID, it's been more 12 to 18 months, and I used to kind of say that the 6 to 12 month mark was really dependent on the court process and where the court's cue is and how backlogged they are. I am finding, I think the longer I practice, that your probate administration is probably 60% to 80% indicative of how efficient, and organized, and on top of it your executor or personal representative is. Because if you've got someone who's going to take charge, hop on things, get things done, it can be more on the 12-month mark. But if you have someone who's sort of dragging their feet, and it's, again, part of the grieving process for people. Some people need to dive into stuff, others need to take time to process before they can dive into stuff.
 
But I would say now probably more 12 to 18 months because I think people are busy, I think people sign up for a lot of things and maybe don't necessarily know they've been signed up for this, but it definitely can take I think more 12 to 18 months now.
 
Marc:
All right, well I want to ask, is a will part of that advanced directive as part of that incapacity conversation? Is that part of that documentation you want to have?
 
Nicole:
A will is what we call an ambulatory document, meaning it actually isn't a valid document until after the testator has passed away. So I sort of joked earlier that when you have an estate plan, your best witness is gone by the time we're effectuating that estate plan, and that's sort of the case with the will. So when it comes to most people's estate plan, when we think about what's included in all of those documents, those legal documents we would prepare, the will is the after-death document, the advanced directives are the pre-death documents. And most estate plans are going to have, at the very least, a durable power of attorney and a healthcare surrogate, with the durable power of attorney being the person that makes financial or legal decisions on your behalf, and your healthcare surrogate being the document where you name someone to be your healthcare proxy or who's making healthcare decisions on your behalf.
 
So part of a robust advanced directive packet, you should really have those two documents, and a few more if it is your wish to have the additional documents. One of the probably more common questions I get on the incapacity planning side is people generally don't want to be kept on life support, they want that pull the plug document, which we call your living will. That's a document where if you have no cognitive function that you do not want any life-prolonging procedures. You want all of those heroic measures withdrawn so that you can pass naturally, but a lot of clients get that confused with a DNR. A DNR is different, that is what I call heart function. So a DNR is also on yellow paper, it's signed by your doctor, and a lot of doctors typically don't like to sign those types of, Do Not Resuscitate or DNR documents, unless you have some sort of terminal condition.
 
So that's why, circling back to the beginning, really kind of making sure that your client, if they have a lot of these end of life or incapacity specific wishes, that they're talking to all of their professionals, not just a lawyer but their doctors and things like that.
 
Marc:
Well look, we're doing this multiple part series on estate planning, obviously a wealth of information here from Nicole. So if you've got some questions, you need some help, definitely make sure that you're reaching out and having conversations with qualified professionals and talking about the situations that you're in and what you might need. So if you'd like to get in touch with the team at Legacy Protection Lawyers, visit them online at legacyprotectionlawyers.com, or call them at (727) 471 5868. Again, (727) 471 5868. And don't forget to subscribe to the podcast, you can catch future episodes as they come out because we are doing a multi-part series on this so there'll be more information to come. And you can find all of that, of course, at John and Nick's website, pfgprivatewealth.com. And don't forget to subscribe to us on whatever podcasting app you like using, like Apple or Spotify and so on and so forth. Nicole, thank you so much for being here and sharing a lot of great information with us.
 
Nicole:
Thanks for having me. This has been fun.
 
Marc:
Been excellent. And John, of course, thank you for being here, my friend, and facilitating as well. Hope you have a great week.
 
John:
Thanks, appreciate it. Have a good one.
 
Marc:
We'll see you next time here on Retirement Planning Redefined with John and Nick.
 

The 4 Things You Can Control in Retirement

Markets crash. Taxes shift. Congress waffles on Social Security. You can’t control any of that. And stressing over it won’t help. What will? Focusing on the four things that actually move the needle in retirement.
 
Helpful Information:
PFG Website: https://www.pfgprivatewealth.com/
Contact: 813-286-7776
Email: info@pfgprivatewealth.com
 
Disclaimer: PFG Private Wealth Management, LLC is an SEC Registered Investment Advisor. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. The topics and information discussed during this podcast are not intended to provide tax or legal advice. Investments involve risk, and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial advisor and/or tax professional before implementing any strategy discussed on this podcast. Past performance is not indicative of future performance. Insurance products and services are offered and sold through individually licensed and appointed insurance agents.
 
 
Marc:
Market crashes, taxes shift, Congress waffles on Social Security, you can't control any of that, and stressing about it will not help. So, let's talk about the things this week that we can control in our retirement.
 
Welcome into the podcast, everybody. This is Retirement Planning - Redefined with John and Nick from PFG Private Wealth, and guys, we're going to talk about a couple of examples of stuff we can control in our retirement world, because there's a whole lot of stuff we can't control, right? So, let's have a chat about some of that this week. What's going on, John? How you doing, my friend?
 
John:
Doing good. I'm doing good. How are you?
 
Marc:
I'm hanging in there. We were just chatting before we jumped on here about the AI getting crazy. We can't control that either, so we got to factor that in, right?
 
John:
No, no. I think [inaudible 00:00:50] right now.
 
Marc:
Yeah, we got to factor that in when we're looking up information and things of that nature, so that's another piece we can't control, so be careful out there with that. Nick, what's going on, my friend? How you doing?
 
Nick:
Good, good. Staying busy. The heat is on here.
 
Marc:
The heat is on. That's right.
 
Nick:
Yeah, we are inching our way into summer.
 
Marc:
Yeah, well, it's that time of the year. It's hot and rainy on a regular basis, but let's get into this conversation this week here. I got a couple items I want to run through. Like I said in the teaser, you can't control what happens in the market, guys, right? Look what happened earlier this year. We knew the tariff thing was going to start. Took a bit of a beating for a while, then it started to rebound pretty well, but you can control how you're positioned, right? That's obvious, but people forget that. When they see the market taking that dive, they panic, "Oh, my gosh, it's going down. The S&P is down 12%, that means I'm 12%." Well, no, John, not really. Not if you're not 100% exposed to the market risk, right? That's the point.
 
John:
Yeah, that is. This is actually perfect timing for what's been going on this year.
 
Marc:
Exactly.
 
John:
We're doing some of these reviews, and we really kind of pride ourselves on making sure people are invested in the right asset allocation per their goals and their plan and their risk tolerance. So, when people put on the news, it seems like doom and gloom, and we're doing some of these reviews and it's like, "Oh, okay, that's good to hear." And part of that is you can't control what the market's going to do, you can't control what politicians are going to do and how that might affect the market, but you can control how you at least take a look at your overall investment portfolio and how you structure it to be able to ... Not saying you're going to weather every storm, but to limit some of the volatility that's happening.
 
Marc:
Sure. Yeah, I can't even begin to say how many advisors I'd talked to where most of them only had a few nervous Nellies, right, and that's okay. It's understandable. A couple would call here there during the height of some of that there in April and saying, "Oh, my God, I see it every five seconds. It's down 12%. I need to go through my numbers." And so they'd run through the portfolio with them and they're like, "You're only down about two at this moment," because they're like, "Oh, well, two's a whole lot better than 12." Well, yeah, so that's the point of not buying into just the straight media all the time and understanding what your risk tolerance is and how much you're exposed to it, so that's one area.
 
Nick, another area is kind of the same thing. It's the great multi-risk multiplier. It's our longevity. We don't have a stamp on us that says when we're going to pass away. It would make things easier and scary all at the same time. But you can control how much emphasis you put into your lifetime income streams, like, how are we setting up these lifetime income streams? And that longevity factors into market risk and all the other stuff too.
 
Nick:
Yeah, for sure. As we kind of start going through the planning process with clients, and then obviously the clients that have been with us for a long time, things will kind of ebb and flow depending upon how well they tolerate things like the market, how focused they are on upsider growth. And we've had multiple clients over the last, I'd say, 12 to 24 months where they've had substantial run-ups in the market over the last 10 years, and have wanted to carve out a certain amount to just kind of give them additional baseline of income.
 
And I think one of the things that's really brought that home to people has been the inflation factor that we've kind of dealt with over the last couple of years, where it's like, okay, they were chugging along and things were going great and felt very comfortable, and then prices and inflation really kind of kicked into gear. And we have a conversation about, "Well, hey, if this happened 10, 12 years down the line, are there things that you would do differently than you've done previous to now?" And a lot of them have wanted to increase that baseline, especially with Social Security being in the news as much as it is, and for a lot of people, that being kind of their baseline lifetime income stream.
 
Marc:
Yup. For sure. And these four things we're talking about this week, guys, they all really play with one another when it comes to building that retirement strategy. And of course, if you need some help, please reach out to a qualified professional before you take any action, like John and Nick. Again, you can find them at pfgprivatewealth.com.
 
But John, I'll kick it back over to you, where we're still waiting to see what's going to happen with the passing at the time we're talking for this Pick the Top Podcast, the Big Beautiful Bill is still hanging out there, and taxation is a piece of that. So, part of what we're waiting to find out is, are the Tax Cuts and Jobs Act that we're currently under, are they going to expire at the end of 2025 in just a few months, or are they going to extend that, right? So we can't control what they're going to do, but we can start thinking about how to be as tax-efficient as possible.
 
John:
Yeah, this is a big one, because taxes are just an eroding factor in your money, and it's best to avoid unnecessary taxes at all costs. And the best way to do that isn't trying to predict what taxes is going to be in the future, it's positioning yourself where you can adapt to any situation. So, if tax rates do go up quite a bit, you have some tax-free money or some after-tax dollars somewhere that you can take advantage of. So, it's important to look at, hey, kind of call it asset location, where are my assets and how are those being taxed? And if taxes go up, how do I adjust? Or if taxes go down, maybe that's a good time to make some moves and make some adjustments.
 
And part of this is, and I found this quite a bit when we're bringing on prospective clients that maybe haven't worked with an advisor or working with an advisor, they're really not projecting what their taxes are going to be in the future. It's just kind of like, "Hey, what's my return? How have I been doing?" But with a comprehensive plan, you can actually look at it and say, "Hey, based on today's numbers, here's what taxes look like. And if taxes go up, you're going to be in a bad situation the way you're currently positioned." So we want to just stress how important it is to allow yourself the ability to adapt.
 
Marc:
Yeah, and Nick, I'll keep that conversation going with you for a second, because if they do nothing, the tax code is going to revert back to the Obama administration era, so rates will go up, brackets will change. If they extend the TCJA, which a lot of people are hoping for, then our tax rates will probably stay the same. And if you're doing Roth conversions, for example, that's going to be great, because you're going to have a longer timeline now to Roth over time and do converting, whereas if the tax rates go up, maybe that changes your strategy.
 
Nick:
Yeah, for sure. And I think the biggest takeaway in the biggest point that this proves is that things continually change. And so, having a proactive plan on how you want to address ... And really what this boils down to is your distribution plan or your withdrawal plan, and how heavily dependent is your withdrawal plan on current environment?
 
And even just to bring that up, I think one of the things that we've found, and we've emphasized it with clients, especially over the last 10 years or so, but clients that have taxable investment accounts, so non-retirement, non-traditional, non-Roth, but just regular taxable investment accounts, they really find themselves in a position to be able to adapt to the environment better than people that don't. So, things that pop up that happen, whether there's a substantial withdrawal that needs to happen, or just flexibility on cash flows, their ability to be able to adapt to what's going on is significantly better, because ... And we are a fan of Roth conversions when they make sense, but there is a risk there from a timing perspective. There's absolutely risks, so that's something that I think is important to point out.
 
Marc:
Well, the fourth one, we said we were going to talk about four items today, guys, and of course you know it's coming because I hadn't mentioned it yet, that's Social Security. We can't control what these folks are going to be doing up there on Capitol Hill, but we can control our strategy, or least start to kind of look, like, how heavily is it relying on Social Security? Or the conversation, John, of when do you turn it on? When do you not? How does that affect your withdrawal strategy and withdrawal rate from other accounts? So, that's something you can control.
 
John:
We can control when you take it and when to defer it and what to do with it if you take it. And again, just going back to the plan on this and stress-testing the plan, how does someone's plan look like if Social Security loses the cost of living adjustments that we've seen recently, which have been pretty significant over the last five or six years. What does the plan look like if all of a sudden that stops? Are you in good shape? And if you're not, how can we mitigate some of that risk? And maybe that does make a difference as to when you take it or how you take that distribution there, but that's one way to look at it.
 
Or assuming, going back to the Social Security podcast, if people are listening, if they don't make any changes in 2034, there'll be about roughly 21% reduction in your benefit. What does your plan look like in that situation? Are you in a good position to weather that storm? I mean, ultimately, we do think they'll make some adjustments to it, but you just want to just know what would happen in that situation, and how do you adapt to it.
 
Marc:
Yeah, I mean it's certainly a big one that you're going to wind up. You're running different stress tests and different kind of scenarios just to kind of see how all this stuff's going to play in with each other. And Nick, I'll toss it back to you for a final point. Anything I missed on those four items that we can control? Those are four pretty big ones. Is there anything else you'd like to touch on, or did we tackle it?
 
Nick:
No, I think those are good. I know just one other point, because there's been some talk about the tax bill that's going through Congress right now, and there was some initial discussion about making Social Security benefits tax-free, and at least from what I've read, that's not the case in this. I know I've had some clients kind of bring that up and ask, and obviously we never know what happens once it kind of works through the Senate and all that kind of stuff. But they did end up, I think, the way that they had handled it was they put in something about an additional credit for seniors, an additional tax credit of, I think, maybe up to $4,000 or something like that, but-
 
Marc:
Yeah, I think that's where they're still kicking around. It went through the House, right, so now it's still got to go through the Senate, and they're still kind of arguing back and forth about what's going to be what, so yeah.
 
Nick:
Yeah. And the reality is that the other thing that this tax bill does point out is that from the standpoint of in the future, and the amount of debt that the government has and all that kind of stuff, there are risks of things that will be taxed in the future that maybe aren't taxed now and stuff like that. So yeah, I think the emphasis is really beyond anything else is that whatever strategy is best today is probably not best tomorrow.
 
Marc:
True.
 
Nick:
And so, the ability to be able to position your assets in a way to kind of adapt, like you mentioned, income streams, have pre-tax money, have Roth money, have taxable brokerage account that's more subject to capital gains versus ordinary income taxes. Even if you're in a position where you can invest in something like real estate, maybe when the prices are a little bit more reasonable, but where you can use the tax benefits of real estate, that's something that could make sense for people. So, it's just giving yourself the ability to adapt to whatever's going on is the most important takeaway I think people should have.
 
Marc:
Yeah, at the end of the day, there's a lot of stuff that we cannot control, but there are many things inside that subsets that we can control, and that's where working with a financial professional can certainly help. So, if you're not already doing so, sit down and have a chat with one. Talk about your unique situation on something you hear on our podcast or any other. Don't just take action without running that through your specific and unique scenario. And of course, John and Nick can help with that. If you're not already working with them, then reach out to them at pfgprivatewealth.com. That is pfgprivatewealth.com. You can call them at (813) 286-7776. And don't forget to subscribe to the podcast on Apple or Spotify or whatever podcasting app you enjoy using. It's Retirement Planning - Redefined, and share the podcast with others that might enjoy the content and get a useful nugget of information along the way as well.
 
So guys, thanks for hanging out and breaking it down. I always appreciate your time. We'll see you guys next time here on Retirement Planning - Redefined with John and Nick.

Should You Gift Money While You’re Alive or Leave A Legacy?

You’ve worked hard, saved well, and now you’re thinking about giving back—maybe to your kids, your grandkids, or a cause you care about. But should you wait and pass that wealth on later, or give while you’re still around to enjoy the impact? Let’s talk about how to make that decision with confidence.
 
Helpful Information:
PFG Website: https://www.pfgprivatewealth.com/
Contact: 813-286-7776
Email: info@pfgprivatewealth.com
 
Disclaimer: PFG Private Wealth Management, LLC is an SEC Registered Investment Advisor. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. The topics and information discussed during this podcast are not intended to provide tax or legal advice. Investments involve risk, and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial advisor and/or tax professional before implementing any strategy discussed on this podcast. Past performance is not indicative of future performance. Insurance products and services are offered and sold through individually licensed and appointed insurance agents.
 
 
Marc:
Welcome in once again to another edition of Retirement Planning, Redefined with John and Nick, and we're going to talk about gifting money while you're alive or leaving a legacy. You work hard, you saved well, so let's talk about how to gift and leave a legacy.
 
Welcome into the podcast everybody. Thanks for hanging out with John and Nick and myself as we talk about these topics this week. And guys, it's gifting, right? So I want to go over some basics here. It seems like there's been a trend the last couple of years for people to enjoy their retirement legacy with the family versus the old way of you pass and you'll leave a check, right? Here's your inheritance, we're gone, that kind of thing. So let's talk about that a little bit this week on the show and just kind of see what you guys are seeing in your neck of the woods. How you doing this week, Nick?
 
Nick:
Good, good. How about yourself?
 
Marc:
Doing pretty good's. How's the wedding action coming?
 
Nick:
Planning's moving along.
 
Marc:
Nice.
 
Nick:
Did some, hopefully we got the food picked out, so trying to check off all the big things, so.
 
Marc:
That's important. Got to have that good food going on for sure. Well, good. Kudos. Good. Glad to hear that. And John, my friend, how are you this week?
 
John:
I'm good. I'm good. Summer just started for the kids, so getting used to waking up in the morning and they're hanging out with me as I'm getting ready for work-
 
Marc:
And they're ready to go.
 
John:
Versus me just dropping them off. Yeah.
 
Marc:
That's right.
 
John:
It's a lot of fun.
 
Marc:
There you go. Are you guys seeing this trend that I talked about, not necessarily a new trend. It's been going on for a number of years now, but I think where people just want to maybe enjoy some experiences with their loved ones while they're still here versus just leaving that check, so to speak? Are you guys seeing that in your practice as well?
 
Nick:
Yeah, I'd say so. We've had, what are we on now? A 14, 15 year bull run from the standpoint of people have kind of exceeded what their perspective on goals was for the money that they might have in retirement and, so especially I would say, at least from what I've seen, the vacation side of things is kind of the biggest thing that people have been doing where they'll do a large family vacation and pay for the kids and their families to go so that they can all enjoy that together.
 
Marc:
Yeah, that's very cool. And we'll talk about some of the numbers and things in just a few minutes, but John, I'll kick this over to you. I'd say the first step probably still should be, make sure you are covered first, right? We all want to leave and do things for our kids and loved ones, but don't sacrifice your own retirement in order just to do that. Is that a fair place to start?
 
John:
That is 100% where you should start. The last thing you want to do is start gifting and spending money on a vacation, and then you look at it and you're like, "Oh man, I don't have enough money to live anymore." So first thing we do in this situation where it comes up with clients is like most things we say, we look at the plan and we will stress test it and look at different scenarios to make sure, hey, if this were to happen, how does your plan react to it? So we'll throw out some scenarios out there, whether it's healthcare, inflation, social security, things like that. And if the plan looks solid, we will typically give somewhat of a green light of, we think you should budget X amount for this. Or we can also look at scenarios where Nick talked about vacation, but we've seen some others where it's like, "Hey, I want to help my son, daughter with a home purchase." And with the way prices are going now, it's very difficult for first time homeowners to be buying houses. So we've seen a lot of people basically lending, not giving money to their kids for buying homes. So we will put that in the plan and say, "Hey, what does your plan look like if you were to give X amount for a down payment?"
 
Marc:
Gotcha. Okay. And we'll talk about some of those numbers and ways to do that here in a few minutes. So I would say if step number one, as John pointed out is make sure you are covered. The next step number two is maybe just kind of clarify your motivation. He kind of touched on that a little bit, but why are you giving, I mean, again, we all love our kids. We want to help, but what's the purpose? Is that an important kind of factor to decide through?
 
Nick:
Yeah, I've had some recent conversations where maybe there's specific topics like, okay, we're off conversions, and because somebody has read or seen an article or something like that, the thought process is, all right, well let's go ahead and let's convert all of our qualified money to Roth accounts and leave the money to them. And a tricky thing with that can be, as an example, is maybe their kids are not in the same sort of economic space as they are and they're not going to ever make nearly the same amount of money. Them taking a hit right away from a tax perspective maybe doesn't make sense, so try to take them back to the initial point in, Hey, what's your motivation? What are you trying to do? What's most important to you? Is it making sure that your plan is structured well to protect you first and then start to do some giving while you're alive? Or is it more focused on you want to give after you pass away and let's structure your assets accordingly?
 
So just so many things, making sure that you fully understand what your objectives are because it can be a little bit of the shiny new thing or a shiny new strategy that weren't familiar with at first or initially, and then once you go through and evaluate it in more detail, maybe it doesn't make a whole lot of sense. But yeah, really understanding how account types work, what your goals are and really what your focus is really important.
 
Marc:
And of course, working with a financial professional is going to help you identify that because often we're not going to know what the account types and the rules and the taxation things are going to be, so that's why you want to turn to the pros on that. So let's get into some of the numbers a little bit, guys, because I actually want to point out a couple of things that based on what you've said so far, and just kind of ask you some clarifying questions on that. But let's start with understanding the gifting rules. So John, what's some of the numbers that we need to know if we just want to gift money in general?
 
John:
So you want to look at what is the gifting amount before you trigger having to file a gift tax return or putting that on your return that you gifted money. So this number changes from year to year typically, and in 2025, it's $19,000 per person. So example, let's say you have a mother, father, and they want to gift to a child. They can each give $19,000 apiece.
 
Marc:
So married couples 38 grand, right?
 
John:
Yes. So that's a good starting point. And then if you have grandkids involved or whatever, you can start gifting to that. So it's $19,000 per person per year without triggering the gift tax filing.
 
Marc:
And that's hefty. Now I'm sure somebody listens going, "I love my kids, but I ain't giving them 38 grand."
 
John:
Again, everyone's situation's different.
 
Marc:
And you can do that. And it doesn't matter if it doesn't have to be family either, right? This could be anybody, right? You can give 19,000.
 
John:
It can be anybody. Yeah. If you want to just find a random person in the street, you're more than welcome to-
 
Marc:
Your favorite podcast host. I mean, podcast hosts need love too, so I'm just saying.
 
John:
Yeah. So that's definitely the starting point. If you're going to be gifting money to any particular individual. If you want to help out with tuition and medical expenses, as long as it's paid directly towards those institutions, you don't have to file any type of gift tax return.
 
Marc:
Now, I wanted to ask you about that because a minute ago you guys were talking about helping with school. Now you can't gift the money and pay the loan, right? It's not paying the student loan, it's paying the tuition. There is a difference there, correct?
 
Nick:
Yeah. And you want to pay it directly to the institution.
 
Marc:
Gotcha. Okay. That's important to know too, right? I'm sure from a tax standpoint as well. All right. What about QCDs, John? Can we do that in that arena as well? If you want to do some gifting?
 
John:
Yeah. So let's explain what that is. So it's qualified charitable distributions from your IRAs. Nick and I use this quite a bit. So when we're doing the fact-finding with clients, one of the main, not one of the main, but one of the questions we go through is, do you do any charitable gifting? And if they check that box, we'll typically find out what institutions and how much they're giving. And once someone hits RMD age, a great way to save on taxes is gifts directly from your IRA. So you could save quite a bit depending on how much someone's gifting. So example, we have someone that doesn't necessarily need their distribution from the IRA, and they were just taking money out of just cash flow, whether it was social security or pension, they were gifting it to their church. What we would typically do is say, "Hey, let's kind of switch this. Let's go to, let's pull out of the IRA." Let's just use number. Maybe it's 10 or 15 grand and we're going to go directly from the IRA to the charitable institution. In this example, it's a church, and you don't pay any taxes on that amount that came out.
 
Marc:
That's ideal, right? And Nick, thinking about how you, if you're a charitably minded person and talking about leaving a legacy, since this kind of rolls into this conversation, people often ask, "Well, which account should I use for what?" And John mentioned that earlier. So if you're thinking about leaving money to your kids and you've got money in a Roth, you might want to leave the kids that right? And then maybe QCD some money from the IRA over to the church, for example, because that's a tax benefit to everybody. Correct?
 
Nick:
Yeah, for sure. That makes sense. I would say to one kind of red flag, or at least something to be very aware of and had this conversation recently with a client is, while you're alive, if you're in a position to be able to gift and if you're in a position to be able to choose where you want to gift money from, avoid gifting from highly appreciated assets from the standpoint of let's say there's a property or there's a taxable brokerage account that maybe you've held 10 different stocks for 20 years and they have a substantial gain. If you gift that while alive, then the recipient, when they sell those is going to pay taxes on the gain versus if you gift it after you pass away, those investments will get a step-up in cost basis, which can save a significant amount of money from a tax perspective. So I would say where you gift from is absolutely, probably if this is something that's important to you, that's where the largest amount of strategy comes into play and doing it from the right place.
 
Marc:
Nick, any other things we missed as far as with the QCD or some of the numbers there?
 
Nick:
Yeah, one thing that we have run into is that some custodians, including the one that we use, Charles Schwab, they don't send out a specific tax document when somebody processes a qualified charitable distribution. So that's something that you want to keep records of and indicate that you've done that with your tax preparer. We've had a couple of clients where they were anticipating that they were going to receive a specific document that laid out exactly what they did, who it paid to, and that sort of thing and that was not the case. It shows the distribution via the 10-99, but they have to notify the tax preparer and usually provide some sort of documentation showing that they made that gift to a charity. So just from a best practice sort of standpoint, that's something to keep in mind.
 
Marc:
All right. All right. Good stuff guys. So as always, if you've got questions and concerns, need some help when it comes to any kind of the financial pieces, the X's and O's when it comes to retirement, you always want to check with qualified financial professionals who do this day in and day out. And John and Nick certainly do so if you need some help, reach out to them online at pfgprivatewealth.com. That's pfgprivatewealth.com and don't forget to subscribe to the podcast on Apple or Spotify or whatever podcasting app you enjoy using. You can reach out to the guys on the website. You can also call them at (813) 286-7776. And don't forget to tune in for new episodes as they come out. I appreciate the time guys. Thanks so much for being here and we'll catch you next time here on Retirement Planning, Redefined with John and Nick.
 
Get yourself a plan, get yourself a strategy. Reach out to John and Nick today at pfgprivatewealth.com, that's pfgprivatewealth.com, to get started on your situation or to tweak your situation and dive into that process with the guys. You can reach out to them at 813-286-7776. Or again, find them online at pfgprivatewealth.com. Don't forget to subscribe to us on the podcast on Apple or Spotify, or whatever platform you like using. We'll see you next time here on Retirement Planning Redefined with John and Nick.
 

Talking To Your Spouse About Market Crash Fears

This episode is all about the emotional side of investing during market turmoil, especially the conversations (or arguments) happening at kitchen tables right now.
 
Helpful Information:
PFG Website: https://www.pfgprivatewealth.com/
Contact: 813-286-7776
Email: info@pfgprivatewealth.com
 
Disclaimer: PFG Private Wealth Management, LLC is an SEC Registered Investment Advisor. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. The topics and information discussed during this podcast are not intended to provide tax or legal advice. Investments involve risk, and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial advisor and/or tax professional before implementing any strategy discussed on this podcast. Past performance is not indicative of future performance. Insurance products and services are offered and sold through individually licensed and appointed insurance agents.
 
 
Speaker 1:
This episode is all about the emotional side of investing during market turmoil, especially the conversations that might be happening around kitchen tables all across America right now. Let's get into it this week here on Retirement Planning Redefined.
 
Welcome into the podcast, where we're going to talk about talking to your spouse or loved one about market crashes and fears. If you're sitting around the dinner table and stressing out about the stuff we've been seeing over the past few weeks, it's been a volatile March and April. It's maybe worthwhile to have a chat about how do you go about that, because obviously when it comes to dealing with money and talking about money, that's sometimes where families and relationships struggle. This week, the guys are going to help us break it down from things they say from their clients, maybe their own personal perspective and mine as well, as we have this conversation.
 
What's going on, John? How are you doing, buddy?
 
John:
Doing good. Just found an electric fireplace.
 
Speaker 1:
Oh, nice, nice.
 
John:
For my remodel. I can't wait to have it installed.
 
Speaker 1:
There you go. Yeah, we got one of those as well when we did ours. Nice, very good. Works well. My wife's always got that thing on. I'm like, "Really?"
 
John:
Yeah.
 
Speaker 1:
Even when it's warm. I'm like, "You're killing me." Well, hey, there you go. Couples and spouses already over the fireplace, we haven't even got to the money yet.
 
What about you, Nick? How are you doing, buddy?
 
Nick:
Good, good. Staying busy.
 
Speaker 1:
Yeah. Well, let's dive into this since you're about to have this situation start to prop up because you've got some nuptials coming soon. Again, congratulations on that.
 
I got a few questions I just want to run through. Feel free to drop in some real life scenarios that you've seen from your own life, or clients, or whatever you guys want to share when it comes to this. It's an important question, because I so many advisors like yourselves say, "Hey, when you're building a retirement plan and a strategy, make sure both people are involved so that you understand what you've got and what you're into." Even if it's not your thing, that way everybody just feels like they're on solid ground when it comes to knowing what's happening.
 
How do you deal with that? As a married couple or in a relationship, how do you deal with market downturns? Because when you start seeing your accounts go down, you start to freak out a little bit. Is it a good idea to talk about that, guys? Or do you think that should be saved for talking, Nick, like in front of you guys, where you're there as a mediator kind of thing?
 
Nick:
I think the number one most important part is that people actually start to have the conversation.
 
Speaker 1:
Just talk, right?
 
Nick:
Yeah, just talk. There's a reason that, I would say from the standpoint of therapy, 50% of the stress probably comes from guidance and 50% just comes from getting it out kind of thing.
 
Speaker 1:
Right.
 
Nick:
The act of literally just talking and trying to get on the same page I think tends to be helpful. The reality is most couples with many things, the way that they approach a decision, the way that they feel about something that's happening tends to be different. It's pretty rare that they're both the same.
 
Speaker 1:
Right.
 
Nick:
John and I talking about that quite a bit with clients, where many of our clients, we'll work as a team. In a lot of ways, we feel like it benefits us because we have similarities and differences just like couples do. Often times, we can pick up on more information because of that.
 
I think having the conversation to get a baseline of how they're feeling about the direction of things. Then, really, I do think it is important to reach out to their advisor and get an idea, a better idea of what's going on. Because the other part about that is that the phase of life that they're in really has a significant impact on how much they could be impacted. We've got clients that are working and just saving, they're often times feeling less concern. Those that are approaching retirement or very early on in retirement, they're probably the ones that are the most freaked out. Those that have been retired for a little bit longer have gotten a better feeling of it and I would say are a little bit more stable when it comes to this sort of thing. Just really getting on the same page is important.
 
Speaker 1:
Yeah, for sure. John, to expand on that, what's each person's natural reaction to financial stress? The two top things that couples fight about is money and in the bedroom, and love. Do you fight, do you flight, freeze, freak out? When you start seeing your accounts drop, are you thinking, "Hey, my dream is fading away?" How do you react to that can go a long way into how you deal with that financial stress.
 
John:
Everyone's personality is different. Everything you just listed there, Nick and I have seen it across the board.
 
Speaker 1:
Oh, sure. Yeah.
 
John:
I definitely say if someone's reaction is to fight over something, it's definitely a good time to do a check with your advisor to avoid those unnecessary fights about it. Everyone reacts differently. It's good to have conversations. Back to what we were saying, just having the plan reflect how is this actually affecting your situation. Once you see that, that might actually take some of the stress away to help you make better decisions.
 
Speaker 1:
Well, yeah, because to that point, Nick, number three is that no matter what you do, whether you fight, flight, freeze, or freak out, is it because you don't know the longterm plan or you're not on the same page? Typically, the panic comes in when you don't realize what's going on, especially if one person is leading the financial charge and the other one is just along for the ride because it's not their thing or they don't care about paying that much attention to it. But then, in these times of turmoil, now they want to pay attention and now they're freaking out because they don't really understand the plan or they don't know it at all. That's the importance of both people working together.
 
Nick:
For sure. I think over time, we realized that when people are uncertain or they don't understand something, that leads to anxiety. And the anxiety builds up and then blows, and that leads to the freak-out factor or fighting between each other, or things like that. We've got clients who have told me one spouse can tell when the other spouse is really freaking out. They're not the personality to say something, but they become ornery or short.
 
Speaker 1:
Right.
 
Nick:
It's like, "Okay, I knew it was time to reach out so that we can have a conversation about this."
 
Speaker 1:
Yeah.
 
Nick:
That absolutely is something that makes a lot of sense. Having that plan to be your guide and stay on path is super important.
 
One of the things that we tend to tell clients over time is, and this is really playing out, where the reality is there's a lot of people, for the last 10-plus years, that have been very heavily invested in the Magnificent Seven, or heavy in tech, and all that kind of thing. It's been a safe haven and out-performed almost everything and pulled the market. Now we've got a little bit of a cycling out of that and it seems like things are shifting a little bit more to diversification is important, that sort of thing.
 
One of the things that we'll tend to say to clients, at all times, you should have something in your strategy that you're very happy about having and something that maybe you're not so happy about having. When markets are going really good, you hate that maybe you've got six, 12 months in cash that's not getting a ton of return. But when markets are going bad, you're really, really happy that you have that six to 12 months in cash for different things. All those things go together to try to help stay on the same page and go back to your plan.
 
Speaker 1:
Yeah. With headlines and internet stuff, and everything like that, it's really easy to get sucked into reactionary moments, John. How do you balance facts with feelings? That's one of the biggest things that we're dealing with. Money and feelings go hand-in-hand. How do you balance the facts in? If you're a couple at home, any thoughts or advice for folks? I know we talked a couple of weeks ago about not doom-scrolling and turning the TV off.
 
John:
Yeah.
 
Speaker 1:
Aside from that, what's some other ways to maybe balance the facts?
 
John:
Yeah. I think it's ultimately looking at your situation, not just what a particular stock or index is doing that day. Like I said, last week, when someone was a little nervous and when we looked at their year-to-date return it was like, "Oh, that's not bad." It's like, "No, it's not bad. This doesn't affect you whatsoever, you can go ahead and travel." It's like, "All right, good to know that."
 
I think it's always going back to your personal situation, and how does it affect you, and how can you adapt. And in some situations, how can you take advantage of what's happening currently? Is there something you could do that would actually be beneficial to your overall over the next two or three years, or overall throughout your whole strategy?
 
Speaker 1:
Good point. Yeah, definitely. You've got to get some facts in this situation because again, so many people just see the headlines, they run with it. They assume that's what's happening to them, and it may not be at all.
 
I guess the final piece here is, Nick, does that play back to have you talked with one another about your-
 
Nick:
Sorry to cut you off.
 
Speaker 1:
No, that's fine.
 
Nick:
I'll give you one example of this. This was what the news will do to people. I have one client who's very risk averse and is concerned about the markets. It was good she checked in because she was getting pretty upset over what was happening. When we checked in it was, "Hey, everything you have is in fixed income." It was, "There's really not much risk." She was like, "Oh, it's just this news, I'm watching it, and it's all this stuff." It's like, "No, you're in really good shape. Nothing is affected." But again, it's just a matter of knowing the facts for her situation. Not everyone's like, obviously.
 
Speaker 1:
Yeah.
 
Nick:
She's extremely risk averse. It was good that she's in the right asset allocation based on her risk tolerance, because she wouldn't be able to handle what's happening right now.
 
Speaker 1:
Yeah, that's hilarious. I'm glad that she got that sorted out too, so that she didn't have to stress. Nick, I was getting ready to ask you that. Is it time for you and your loved one, you and your spouse, to talk about your risk tolerance? Do you assume you're on the same page, are you on the same page? Or does your advisor even know what your risk tolerance is? Have you gone through and updated that stuff and had those pulse checks?
 
Nick:
Yeah, it's really interesting because we'll have clients, for example, clients that are still working. Depending upon their personalities, I have a lot of clients that, if it's a couple, one person picks their own 401K investments, the other person picks their own 401K investments. Sometimes they might compare or look, and they'll pick their investments based upon ... These are, often times, people that, when they come in before they become clients, pick based upon what their own set of fact that they're using and all that sort of thing. When they shift to the phase of, okay, maybe retire, and now they're making more decisions together and trying to get on the same page.
 
Where we'll literally have situations where it's like, okay, say it's a couple, he's got his rollover into an IRA, she's got her rollover into an IRA, and then they have a joint account. The joint account's invested completely differently than either of the IRAs because they have to come to an agreement on it. It's interesting, the dynamics of how that works and how they slowly have to get on the same page often times. But having that conversation, those I would say that are more advanced at having those conversations earlier on, definitely end up in a better position.
 
Speaker 1:
Yeah. At the end of the day, guys, it all comes down to conversations and chatting with one another, and being honest, about what you need to do. Especially with you and your loved one, if you're thinking that your retirement or your financial dreams are dissipating, well, A, are you on the same page with each other? And B, are you on the same page with your advisor and do they know that? It's important to sit down, have a conversation, have a chat. Reach out to your advisor, especially in these times.
 
I saw a line the other day, I don't know if I'll remember it exactly what it is. It was like, "Advisors, you're really earning your keep in times like these. This is when discipline and consistency beats brilliance." You're not trying to time the market and things of that nature, because there's always going to be these ups and downs. It's having a good, consistent plan to help you get to and through all kinds of different environments that are going to happen if you're retired 20, 25, 30, 35 years.
 
Get yourself a plan, get yourself a strategy. Reach out to John and Nick today at pfgprivatewealth.com, that's pfgprivatewealth.com, to get started on your situation or to tweak your situation and dive into that process with the guys. You can reach out to them at 813-286-7776. Or again, find them online at pfgprivatewealth.com. Don't forget to subscribe to us on the podcast on Apple or Spotify, or whatever platform you like using. We'll see you next time here on Retirement Planning Redefined with John and Nick.

What Should You Actually Do When the Market Drops?

The headlines are loud, the markets are messy, and your gut might be telling you to do something — anything — right now. But what should you actually do when your portfolio takes a hit?
 
Helpful Information:
PFG Website: https://www.pfgprivatewealth.com/
Contact: 813-286-7776
Email: info@pfgprivatewealth.com
 
Disclaimer: PFG Private Wealth Management, LLC is an SEC Registered Investment Advisor. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. The topics and information discussed during this podcast are not intended to provide tax or legal advice. Investments involve risk, and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial advisor and/or tax professional before implementing any strategy discussed on this podcast. Past performance is not indicative of future performance. Insurance products and services are offered and sold through individually licensed and appointed insurance agents.
 
 
Marc:
The headlines are loud, the markets are messy, and your gut might be telling you to do something, anything. So what should you actually do when market downturns happen? Let's get into it this week here on ‎Retirement Planning - Redefined.
 
Welcome onto the podcast. Thanks for hanging out with John, Nick, and myself as we talk investing, finance, and retirement. And, guys, with all the volatility and stuff happening, I thought it'd be a good idea to maybe address some of this stuff. And we've got four key questions maybe to ask ourselves when we're going through some of this volatility and let you guys give some people insights on what you're seeing and what your thoughts are when it comes to this kind of stuff. So welcome on this week, John. How you doing, buddy?
 
John:
I'm doing all right.
 
Marc:
Yeah? A little busy?
 
John:
Just getting ready to start a kitchen remodel, which is bringing its own gut check, but doing all right.
 
Marc:
That is true. Very true. And Nick, how are you doing, my friend?
 
Nick:
Good, good. Staying busy. Obviously a little chaotic right now, but knee-deep in wedding planning. So that's fun.
 
Marc:
So let me ask you guys, before we get into this, when we're seeing this kind of volatility, do you get many calls? I've talked with all kinds of advisors and most of them say a couple, a couple panicked people, but for the most part, their clients have a strategy and a plan in place and it makes it a little easier to handle when there's volatile times like this. Is that kind of the same for you, or what are you seeing out there?
 
John:
Yeah, I'd agree with that. As we mentioned quite a bit in our last podcast, our last sessions, our practice is generally planning based. So a lot of times people are comfortable with where they are, and we do a good job of reinforcing here's where you are, here's your asset allocation, here's how we structure things for a downturn or some volatility. So I think we do a really good job of making sure people are in the right asset allocation, and not only that, but structuring their assets where when they are using their funds for retirement, we have a plan in place to draw on specific accounts when we are expecting this type of volatility.
 
Marc:
Makes sense. Yeah. Gotcha. Well, as you mentioned, gut check as that kind of goes. So let's jump in and do these four items here. And that's the first one. Nick, I'll let you start if you want to. So when is the last time you checked your strategy? When's the last time you checked your plan? I hear people saying, "Oh, the market's down year-to-date, the S&P's down 13%." Well, are you down that or are you only down maybe two or three because you hopefully were properly diversified, right? So when's the last time you checked in on your plan and do you need that gut check? What's your thoughts?
 
Nick:
Yeah, so we try to make sure we're updating plans. We'll go over general numbers each year. And then one thing that we focused quite a bit on last year with clients was updating expenses. With having the inflation like we did for a while, the expenses are obviously a huge driver for clients, and so a lot of our clients are updated. And I know John kind of touched on how many are reaching out. And I would say obviously compared to the clients that we have, there are some that do. And I think the good part about the planning, those that had the planning, we're just reinforcing and reviewing what we've discussed in the past.
 
I had a couple conversations earlier today with similar thoughts and sentiments, and even though most clients know that they have some sort of mix between stocks and bonds, they rarely think about the bond portion not being as volatile. And so that's something that even where in our minds it might kind of feel basic, these little things, and just kind of talking through and reminding clients about what they actually have, why they're positioned the way that they're positioned and why we did the plan. It's also a reminder for us. We've had some clients that maybe six months, 12 months ago, like, "Hey, should we get more aggressive," et cetera, et cetera. And we kind of emphasized that we've had a really good run for a really long time, and at a certain point there's going to be some sort of pullback. And so I think those clients that both from a being too conservative or being too aggressive standpoint are kind of happy that they have a plan.
 
Marc:
Gotcha. Okay. And so John, that would probably lead to the second step, which is if you are doing that gut check and you do feel like there's some things you need to do, where are you at with your risk? As I mentioned a second ago, people see the headlines and it makes them panic. It makes them worry, it makes us easily agitated. "Oh, it's down 13%." But if you're not taking 100% risk, you're probably not down 13 whole percent, right? So it's about having that risk tolerance adjusted as well.
 
John:
Yeah, and like Nick mentioned, I just had a scenario where this actually came up. They're watching the news and it's doom and gloom. And I'll tell you, I put it on for a little bit sometimes and it's like, all right, if you're watching this all day, I could see where people are panicking. But when we did their review, the person was down minimal year to date, and they're like, "Oh, that's it?" And it's just like, "Yeah, you're doing all right." And then when you reference the plan and you actually show them, "Hey, based on what just happened this last week, you're still in good shape and here's a strategy if this volatility continues, this is how we're going to handle it if you're withdrawing from the portfolio."
 
And then I will say that what Nick said there as well of, people, when things look good, it's like, "Hey, should I get more aggressive so I can earn more?" And it's really important just to stay the course because you do have these pullbacks and when you do get more aggressive and let's say all of a sudden the market pulls back like we're in the middle of right now and you can't handle that risk, that's when you jump ship and then all of a sudden there could be some news that comes out. Literally there could be one bit of news, especially in what we're dealing with right now and the market could just completely do a 360 and just be positive quite a bit.
 
Marc:
Yeah. At the time we're taping this, we saw that to open up today. It went up about 4% in the first half of the day, and then it started to cool back off. So there's still a lot of things flowing back and forth, Nick, and that again leads back to strategy, right? So that's the third piece of this conversation. Do you have a strategy and are there some things that we should look at, try to find the positives or the silver linings of downturns? What are some things we could maybe, some smart moves we could be looking at?
 
Nick:
Yeah, just even before we get into that, I wanted to touch on John's last point, just from the standpoint of part of the conversation that we've been having with people is that the volatility in the markets, both good and bad, are so much quicker than they were years ago. There's a lot of people that are used to prolonged just slow bleed downturns. And where from hour to hour, day to day, you can have a correction and then claw half of it back within a few days. And just kind of shifting out during that period of time can be pretty deadly for a portfolio.
 
But from the standpoint of what can be done now or what could make sense now with what you alluded to, dependent upon, it is a good time to kind of do that check on overall risk, potentially integrating in some rebalancing of the portfolio. We try to have clients have some cash on the sidelines no matter what. And it could be a decent time to average in some of that money if they're looking to reinvest.
 
For those that are still working, I think the emphasis that we put on is buying at a discount when you're averaging in every month and that sort of thing. And then even from the perspective of, and it's something that we are reviewing, tax loss harvesting in taxable investment accounts can be something that makes sense. I will say that unless there's, so many people's positions are up or vary in the green that it can be a little hard even still with this pullback to get some losses and offset some gains and that sort of thing. But we can also take advantage of some of the losses to offset future gains as well. So those are all things that we're reviewing.
 
Marc:
Yeah. And a lot of people are taught, have been wanting to do Roth conversions, for example, right? Well, I mean, kind of silver lining when your accounts are down a little bit in a 401. Maybe you're doing some conversions over to Roth and you're paying lower taxes because the balances are down. And then when the market comes back, because it tends to do, as long as your plan calls for it, then you're gaining that money back tax-free. So different kinds of silver linings. You have to work with a professional, you have to work with an advisor to find your way through some of these tougher times. And so that brings us to the final point, which is unhelpful behaviors, right? So what are some things, guys, we need to stop doing right now if we're getting stressed out? John, you kind of hit it perfectly on the head, said you watched it for half an hour or an hour and it's like, "Yeah, no wonder people are getting down, right?"
 
John:
Yeah, it's definitely doom and gloom out there. So I would say whatever station you're watching the last couple of weeks, it's definitely everything's negative.
 
Marc:
And that's their job. We have to be realistic about that. That's all they're going... They're not going to talk about the positives very often, right? They're looking for the eyeballs from the panic, right?
 
John:
Yeah, hundred percent. I think negative news typically rates better. So that's why you continually see the negative news drip on everybody. But back to one thing you mentioned there, Marc, about the Roth conversions. I just want to point out that is a great strategy when the market dips down, if you're currently implementing a Roth conversion strategy. It is typically a good time to do it when we're having a pullback.
 
Trying to time it perfectly is obviously going to be difficult to do, but you just try to do your best with that. But when you are converting, just want to make it clear to anyone listening, you typically want to, when you're converting for the strategy of a lower balance and paying lower taxes on the specific shares, you want to do a Roth conversion, that's you keep your shares. So you're doing kind of a transfer of shares over to the Roth versus cashing out and sending the cash over and then rebuying it. So just be careful. If you're working with an advisor, just understand, hey, if we're doing a Roth conversion, are you cashing it out? Are you transferring over the shares? Because we feel it's best to transfer over the shares so that we don't have to rebuy them.
 
Marc:
Yeah. No, definitely. I just was thinking that that was another little piece, so thank you for kind of taking it a little deeper, if that's part of your current strategy. So yeah, turning off the news is certainly a helpful behavior. What else, Nick, you got anything else that you'd like to chime in on that topic?
 
Nick:
Yeah, as somebody that has sometimes a tendency to doom scroll a little bit and try to suck in as much information and try to be able to understand different points of view and all that kind of stuff, it is important to take a break. Something as simple as getting outside, going for a walk, having a conversation. One of the things we try to emphasize with our clients is that if you're getting to that point where severe high level anxiety, maybe concerned about starting to make poor decisions or overreact to anything, is just reach out. Usually the feedback that we get when we just have a conversation with somebody is that able to give perspective. And realistically, what happened yesterday in the markets, which we had a fake post about a change to the tariffs and the market swung like 7 or 8% in five minutes and all this other stuff, really kind of emphasizes the fact that volatility is different than it used to be and overreacting can be something that really hurts you and your overall position.
 
Marc:
That's a great point, right? I mean, we're certainly, the doom scrolling, the second by second feedback, you have to have a strategy, right? And our own worst enemy is ourself. We tend to jump out and do things and then we lock in those losses. So again, before you take any action on something you hear from even our conversation or any other thing that you hear that they're financially based, you should always run that past a financial professional as it relates to your specific unique situation, as the guys pointed out numerous times today in the show.
 
So if you need some help with that, stop by on the website or give them a call and set up a time to chat, pfgprivatewealth.com, that's pfgprivatewealth.com, or call 813-286-7776. Guys, thanks for hanging out and breaking it down a little bit. Hopefully people keep their heads and we'll see how this plays out. It could be short-lived, it could be a little longer term. So get a strategy. At the end of the day, that's what's important. So the guys can help you with retirement planning redefined. We'll see you next time here on the podcast.

Inside the Advisor’s Office: What People Are Actually Concerned About

Ever wonder what other people talk about with their financial advisors? A new survey of nearly 400 experienced advisors reveals the biggest concerns, challenges, and financial goals their clients are facing today. From retirement planning to healthcare costs to working longer than expected, we’re breaking down the key takeaways and how they compare to what we see in our own client conversations.
 
Helpful Information:
PFG Website: https://www.pfgprivatewealth.com/
Contact: 813-286-7776
Email: info@pfgprivatewealth.com
 
Disclaimer: PFG Private Wealth Management, LLC is an SEC Registered Investment Advisor. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. The topics and information discussed during this podcast are not intended to provide tax or legal advice. Investments involve risk, and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial advisor and/or tax professional before implementing any strategy discussed on this podcast. Past performance is not indicative of future performance. Insurance products and services are offered and sold through individually licensed and appointed insurance agents.
 
 
Marc:
Ever wonder what people are talking about with their financial advisors? Well this week on the show we're going to discuss a new survey of nearly 400 experienced advisors revealing the biggest concerns, challenges, and financial goals that their clients are facing. We'll see how that compares with what the guys see here on the show. Let's get into it this week on Retirement Planning - Redefined.
 
Welcome to the podcast, everybody. Thanks for hanging out with John and Nick and myself as we talk investing, finance and retirement. And guys, we're going to share this survey. We'll put a link into the show descriptions as well for folks that want to check it out, but want to run some of this information past you guys and see does that correlate with what you're seeing, do you think it's accurate, not accurate, and just spitball and talk a little bit about some of the stuff out here.
 
The survey was done of nearly 400 experienced advisors all with around 20 years or more of a business, practicing business, so interesting. They didn't really say exactly the age bracket of all the people they were talking to, so there could be some folks that are not necessarily retirement age. They could be younger as well as older, but I want to run down some of this stuff and just get your guys' take on it.
 
How you doing this week, John?
 
John:
I'm doing well. Daylight savings is messing with me a little bit, but I'm adjusting pretty well. And one of my kids, actually both my kids, they're testing for an honor belt in karate.
 
Marc:
Oh, nice.
 
John:
So they're excited.
 
Marc:
They're going to whoop on you. Be careful.
 
John:
It's funny you say that. They're running around the house kicking me now. It's like I wanted to get them into some self-defense stuff, but now I'm getting kicked.
 
Marc:
So now you got to walk around with some pads on.
 
John:
Pretty much.
 
Marc:
Make sure you're not getting beat up too much. Very cool. Well watch the shins, man. They'll get you in the shins.
 
Nick, how you doing, buddy?
 
Nick:
Good. We're staying busy.
 
Marc:
He's like, "Good." Well, let's break this down a little bit, guys.
 
John:
That's the sound of a guy that's in the middle of planning a wedding.
 
Marc:
Right? That's what I was just thinking. He's like, "I got to make another decision. I don't want to make a decision." Let's jump into this and we'll see if we can make this easy for you this week, Nick.
 
So seeking out a financial advisor, the first part of this survey, advisors in the survey said 52% of their clients have sought out financial advisors to help with the retirement planning. About 34% surveyed were just looking for somebody to build wealth with. And in an era where everybody can call themselves a financial advisor, does that strike you as interesting? What do you guys think about that, 52% looking for retirement planning versus 34 just looking for some sort of wealth building, whoever wants to start?
 
John:
Yeah, those numbers seem accurate to me. Well, I guess I'm a little surprised it's not more looking for help with retirement planning.
 
Marc:
Okay.
 
John:
I'd say the majority of our clients are retirement planning based, "Hey, I want to make sure my plan's good. I want to make sure I don't outlive my money." As far as building wealth, that does come up quite a bit, and Nick will jump in as well, but I'd say most of our clients are looking for retirement planning and just making sure they're on track and making sure that they're making the right decisions.
 
Marc:
And it's two different mindsets too, right, Nick? I mean, so you need to decide what it is that you're looking for. I mean, not to say that you couldn't work with a retirement planner who also can help you with some of the wealth building, but it is a different skillset as well. If you're just looking for someone only to help you build the wealth, that's a little bit easier, I would think.
 
Nick:
Yeah, and I would almost, if I were to say maybe put that in other words, we talk with people at the three phases of money as far as their life goes are accumulation or growth, distribution, taking their money in retirement and then transfer when they leave money. And so I would say from that initial, that wealth building, that's most likely accumulation focused. And because so many people accumulate their money while working in their 401(k)s and that kind of thing, I think it tends to be a little bit of a different conversation and it's those people that as you get closer to retirement. So without having ages, it does make it, the numbers are interesting, and I agree with John, I would've thought maybe it'd be a little bit higher from the standpoint of the retirement planning side, but-
 
Marc:
Well, I mean, if you're just trying to grow the money, again the market's been, obviously we haven't had a prolonged downturn, and it's been choppy here lately, but we haven't had a prolonged downturn since '08, '09, so there's a lot of information out there about saying it's a little bit easier to build the wealth. But the preservation stage, which retirement is a little bit more complicated. There's more things going on than just the portfolio.
 
But with that in mind, check this out. Over half of the survey of financial advisors said the average client asset minimum was 760,000. I found that to be good. I know different areas are going to be more or less depending on the economic state of the area, but when you often hear that people aren't doing a very good job saving for their retirement future, three quarters of a million dollars is not bad.
 
Nick:
It's definitely interesting to see the numbers and how they've changed over the last five to seven years where, and you mentioned it earlier where we've had a long prolonged period of time with the market going up, and so there's quite a bit of people meeting with us or ending up with more money than they had thought that they would or that sort of thing. There's a little bit of concern with that that only lasts for so long and that there's some correction and all that kind of stuff to happen. But absolutely, definitely that puts most people in the wheelhouse of where they need to be to have a successful retirement.
 
Marc:
I mean, it's not bad. John, do you guys have a minimum? I mean, I know different advisor firms do different things. You can't service everybody. There's only so many hours in a day. So you'll hear something where somebody says, "Well, we work with people with 250,000 who have saved or more in assets," or some or a million or whatever. Do you guys have a breakdown?
 
Nick:
We don't have a set minimum that we advertise or market.
 
Marc:
Okay.
 
Nick:
I would say that the majority of the people that meet with us tend to have what many institutions have as their minimum. So in other words, a lot of places will tell people, like you referred to that, they're looking to work with clients that have 250,000 or more just from an efficiency standpoint of trying to make sure that they can service their clients and that sort of thing, and so we end up above that with most clients. But the reality is, is that the conversations that we have with clients are really we don't keep that rule set in stone because for us, it's more of a relationship-based.
 
Marc:
Individually based kind of thing? Okay.
 
Nick:
Yeah, and really it's something we're looking for people that are serious about planning. I would say if you were to draw a line between what we were talking about earlier where a growth or retirement planning in a more broadly focused strategy, so they're focused on that. They're serious about it. We reference like, "Hey, we don't want to convince you that you needed an advisor. We want you to know that you need one and we want to interview for the job," kind of concept.
 
Marc:
No, that makes sense because I mean if you're giving suggestions and someone's not willing to take them, you're just wasting each other's time versus... Yeah.
 
Nick:
Exactly, and we found that that'll waste more time than in theory working with somebody that maybe isn't where they're going to be yet. And also-
 
Marc:
It needs to be a reciprocal relationship.
 
Nick:
For sure. Communication's super important for us because we've also found that we've had people come in that maybe are under that 250, but their parents are wealthy and they ended up being a teacher or something that maybe didn't allow them to save as much money as some sorts of jobs, and they're going to inherit money and they need assistance that way. So I'd say we're pretty comfortable with our process and how we approach that sort of thing and really look for it on a relationship basis, communication basis, and how we all get along.
 
Marc:
That makes sense. And it's got to be a two-way street. I mean, when we do the podcast, it's not designed to turn every listener into a client if they're not already a client, but it is designed to say, "Hey, if it's the right relationship field going both ways, then we're happy to help if we can." That's pretty cool. So that's a good way of looking at that.
 
John, check out some of these top concerns. Let me know what you think here. So no surprise, number one, outliving their assets, 38% of the people surveyed. That's pretty much always number one, right? Outliving your money.
 
John:
Yeah.
 
Marc:
31%, generating reliable income streams, a pretty high number as well.
 
John:
Yes.
 
Marc:
Okay. Then it drops off to a pretty stark, down to 12% for a future stock market crash. Now with some context here, this survey was completed at the end of last year, so it was December of '24. Do you think that number's gone up recently?
 
John:
I would willing to bet that number's gone up. I think we were talking about the market, the last real big downturn was '08, and I think in the last 10 years, we've only had two years of the market being down, the S&P 500. I think it was, what, '22 and 2014, I believe.
 
Nick:
I'd almost say that's a leading indicator that there's going to be, it's one of those things. Once people get that comfortable, that's usually when it comes.
 
Marc:
I mean, it's been a while, right? So because nobody's worried about it whenever it's riding high. We only seem to worry about it whenever we're in the middle of it falling a little bit. But the one that really surprises me is all the way down to 8% for healthcare costs. Now if you guys are focused more on helping people with retirement planning and strategies, that to me, again depending on the ages of the people that answered this survey, healthcare costs at 8% seems awfully low because it's pretty costly, and we need to be having those conversations when we're, especially as we're getting older.
 
John:
Yeah, for sure. This one, it is very important, and I think it's same thing we're talking about the stock market where it's been doing well. And when you're healthy-
 
Marc:
It's great.
 
John:
...you think you're going to be healthy for a long time.
 
Marc:
You don't think about it. Right, exactly.
 
John:
You don't think about it all. It's back of your mind. I'll tell you where we see a lot of people concerned about it is if they had to do some care for their parents. Then it becomes top of mind of like, "Hey, this was a lot that I just went through." And taking care of them or seeing, whatever, if they have to go into a facility, and then in turn that's where we see the most of our clients that are concerned about healthcare costs is if they had to take care of a loved one.
 
Marc:
Nick, according to the survey on that topic, advisors that were surveyed in this, were saying that clients should be more concerned about healthcare costs at around 54% unanticipated healthcare cost. Will you agree with that as well? Because I mean, obviously it comes out of the blue, it can totally derail the whole strategy.
 
Nick:
Yeah, I think part of that is, from an advisor perspective, the whole concept of long-term care, obviously I'd say many advisors have a good grasp on long-term care, but I think it's become increasingly difficult for advisors to help clients plan for that with insurance or certain products that are out there. If we went back 10 years and from, let's just call it 2015 back through maybe 2005, that was the golden era per se for clients to be able to secure a reasonably priced policy from a long-term care perspective. So I think maybe that ties into the concern that advisors have is that at the end of the day it's a really expensive problem that clients can have, but it's also an expensive solution that a lot of clients are reticent to spend on something that may not be an issue, especially in a state like Florida where all of the insurance, people have serious insurance fatigue here.
 
Marc:
Oh, I'm sure.
 
Nick:
So it's a funny thing. The one time I actually answered a soliciting call earlier this morning was from State Farm calling me to, and they asked me if they could shop my car insurance for me, and I said, "Sure, let's try it." And sure enough, it was going to be $1,400 a year more than what I'm currently paying.
 
Marc:
Thanks for the help.
 
Nick:
And she laughed too, and she's like, "Well, can I call you in six months?" I was like, "You can try."
 
Marc:
You can try.
 
Nick:
I don't think you guys are going to come down that much. And so it's just crazy with what people are paying here. And so I think, long story short, I think that really ties into it as well for advisors.
 
Marc:
And I'll hit you with this last one, John. I'll let you start and then I'll let Nick jump in if he wants to. And again, this survey was completed at the end of last year, so you can't take the current market downturn into this conversation. But according to the survey, an average of 63% of clients age 55 or older intended to work to 65 and beyond. 63% of people wanted to continue working up to 65 or beyond, yet only 30% of those clients are actually still doing it. So I guess my question is, does this surprise you that people want to keep working longer? And if so, what are some of the main reasons why you guys are seeing people want to work into their older ages?
 
John:
It doesn't surprise me. I think with the shift really since COVID of being able to work remote, I've seen a lot of people that sit there now thinking like, hey, I work from home. I can travel still and log in. And it's given them a comfort of just saying, yeah, I'm making good money. I can continue to do this.
 
Marc:
Feather than nest some more, right?
 
John:
Yeah, so it's just building up the nest egg and allows them maybe to feel comfortable doing some more travel that they otherwise maybe wouldn't have felt so comfortable doing. We talked about the fears of outliving your assets, so I've seen a lot of that. And then there's a lot of studies out there saying, just keeping sharp of mind. So I've seen that where people are like, "Hey, I don't want to retire because I want to stay active. I want to have a purpose and continue to do things." So I think I'm not surprised by that number.
 
Marc:
Interesting.
 
John:
Because we're having more conversations of people wanting to work longer because they enjoy what they're doing. And with Zoom, it's become very easy to continue to work longer.
 
Marc:
Well Nick, I'll give you this last piece here. 48% of those people feel like they don't have enough saved to live on through retirement. I mean, you're talking about half. So half of the people surveyed don't think they have enough, so that sounds like it just comes back to just not truly having a plan or even really knowing what it is that you've got. They've probably never sat down and really pulled this stuff together so they don't feel confident.
 
Nick:
Correct. I think you nailed it there. The uncertainty of not having a plan and not knowing and understanding what things look like really oftentimes causes procrastination, and then all of a sudden it's 5, 7, 10 years later and there could have been a couple of small tweaks or a couple of small adjustments. I mean, in reality, there's been so many times when within 30 minutes if John and I meeting with somebody the initial time, we can tell three to five things that they could do that wouldn't have a significant impact on their life, but would have a significant impact from a positive perspective on their overall planning. And so whether it's informing themselves and holding themselves accountable or working with an advisor, which we have found, and there's been a ton of studies that have found that having that partner to help guide them through the decision-making process, that there's significant value there and the average rates of return and all that kind of stuff show that because of the decision-making.
 
Marc:
Well, think about what you're going through with the wedding planning stuff. So there was a thing a couple years ago we were talking about, some of the most stressful events we can do in life, one of them was planning for a wedding. One of them was planning for retirement, right?
 
Nick:
Yeah.
 
Marc:
There's a lot of decisions to be made. And so having somebody to lean on I think goes a long way into removing some of that stress because it does get overwhelming. And at some points you're just like, ah, screw it. I don't even know what to do anymore. So being able to talk with guys like yourselves and say, "Okay, look. Here's some thoughts we had," or, "Here's what we were afraid of," or whatever the case is, it gives you that sounding board to bounce some ideas off of and maybe get some reassurance.
 
Nick:
Yep, fully agree.
 
Marc:
Yeah, and so are you having that same problem from the wedding standpoint?
 
Nick:
Right now we're interviewing planners-
 
Marc:
There you go.
 
Nick:
...and the prices have gone up, so it's-
 
Marc:
But you're looking for help, right, because it's a lot.
 
Nick:
Yeah, absolutely, absolutely.
 
Marc:
John, you don't want to be the wedding planner?
 
John:
No, no. I did that 12 years ago-
 
Marc:
I got you.
 
John:
...and I want no part of that.
 
Marc:
I got you. Well, all right, guys, good conversation as always. Thanks so much for hanging out. So at the end of the day, I mean you find these surveys are pretty interesting. And I think a lot of this stuff comes back fairly similar each time, is that people are looking for some assurance. They're looking for some clarity in some of these situations, so that's the point of running through the planning process is finding out what do you got, where do you stand and how's it working for you, and do you need to make some changes?
 
Often people feel like we're going to have to do some major overhaul, and it scares them. But a lot of times when you run through the planning process, many people are in better shape than they realize. You just need some tweaks here and there. So if you want to have those conversations for yourself, reach out to John and Nick and get started today at pfgprivatewealth.com. That's pfgprivatewealth.com. Get yourself onto the calendar for a consultation and a conversation.
 
And don't forget to subscribe to us on Apple or Spotify, whatever podcasting app you like using. Retirement Planning - Redefined is the name of the show with John and Nick, and we'll see you next time here on the program. Thanks, guys. Take care of yourself.

April Fool’s: Beliefs That Fool Retirement Savers The Most

April Fool’s Day is all about jokes and pranks, but when it comes to retirement planning, getting fooled can cost you real money. Today, we’re uncovering the beliefs that fool retirees and pre-retirees into making bad financial moves.
 
Helpful Information:
PFG Website: https://www.pfgprivatewealth.com/
Contact: 813-286-7776
Email: info@pfgprivatewealth.com
 
Disclaimer: PFG Private Wealth Management, LLC is an SEC Registered Investment Advisor. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. The topics and information discussed during this podcast are not intended to provide tax or legal advice. Investments involve risk, and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial advisor and/or tax professional before implementing any strategy discussed on this podcast. Past performance is not indicative of future performance. Insurance products and services are offered and sold through individually licensed and appointed insurance agents.
 
 
Host:
April Fool's Day is all about jokes and pranks, but when it comes to retirement planning, getting fooled can cost you some real money. So we're going to talk about that. A little early for April Fool's, maybe, but we're going to still talk about it this week here on the podcast. So let's get into it.
 
Hey, everybody, welcome to the show. Thanks for hanging out with us here on Retirement Planning Redefined, with John, and Nick, and myself, as we talk investing, finance, and retirement. And we're taping this a couple of weeks before April Fool's Day. It should drop right around there, but we'll have a conversation with the guys. What's going on, Nick, buddy, how are you?
 
Nick:
Good, good. Staying busy.
 
Host:
Yeah. Well, that's always good. Good stuff. John, I know you and I were just chatting before we got rolling, we're worn out. But you hanging in there?
 
John:
Yeah, doing all right. And don't let Nick fool you, he's got a lot going on.
 
Host:
He's got a lot going on.
 
John:
You tell him the news.
 
Host:
He did. Yeah.
 
Nick:
John's favorite topic. Got engaged a little over a month ago.
 
Host:
Awesome, awesome.
 
Nick:
Yeah, in the full throws of wedding planning, which is, of course, extremely exciting.
 
Host:
That you're doing a little of, or a lot of, or zero of?
 
Nick:
I would say some impact. My fiance is originally from Columbia, and the way that they do things for weddings there is a lot different than here.
 
Host:
Okay, cool.
 
Nick:
So yeah, so there's a little bit of translation from that perspective.
 
Host:
Nice, nice.
 
Nick:
Yeah, that's interesting. But it'll be good.
 
Host:
Very cool. Nice.
 
Nick:
It'll be good.
 
Host:
Well, congratulations. Very, very cool.
 
Nick:
Thank you. Appreciate it.
 
Host:
All the best to the newlyweds. Very good stuff. We won't pull any April Fool's Day pranks on you then, in that regard. We'll just take to the financial stuff here this week.
 
So the idea, guys, being that, look, the media is nonstop, the onslaught of social media, internet, whatever. There's always something out there. And you just want to make sure you're vetting some stuff before you... Fool's gold, right? Before you just jump into something and maybe make a mistake.
 
So we'll start with tax conversation. So as at this time that we're taping the podcast, we don't know if the TCJA will get extended or not. Odds are fairly good, we'll see how the year plays out. But if they don't, they expire at the end of the year, the current tax code that we're under.
 
So are you taking that information and maybe thinking, hey, I don't have to do any tax planning for the future, because maybe the taxes are going to stay really low like they have been historically? Or are you being proactive and saying, "Well, there's a chance that taxes could still go up, because we owe a lot of money"? So whoever wants to jump in, get started on that. But what do you think about the tax situation and not fooling yourself into just thinking everything's going to stay exactly the same?
 
Nick:
Yeah, I can start with this one. So one of the things that we really emphasize with clients and people that we work with is, especially when it comes to taxes, that the best thing that you can do is to expect change. So whether it's something changing at the end of this year, a couple years from now, whatever it is, the goal is to allow yourself to be adaptable to whatever's happening.
 
So the easiest way to do that is to have different types of accounts. So to have Roth accounts, pre-tax accounts, and more of a traditional brokerage account where we can factor in capital gains instead.
 
But even more specific, when it comes to the whole concept of potentially underestimating taxes, there's still a lot of confusion for people on how much of their social security is going to be taxable, or include-able in their taxable income. I had a conversation with my parents about it, and I had to convince them that I was correct and knew what I was talking about after 20 years, because of a way that something that they heard on the radio or saw on TV was phrased, made it very confusing to them. So just-
 
Host:
Sure, I mean, there's the conversation that they might get rid of it, but they haven't done it yet. So you still got to be planning for stuff.
 
Nick:
Yeah. But even outside of that, the way... It was interesting, and I do want to bring it up now that I remember it.
 
Host:
Sure.
 
Nick:
The way that it was being marketed was that the concept of, "Hey, most people don't know that your social security, how much you pay in taxes on your social security will go up at age 73." And so, really, the concept of that was, "Hey, when required minimum distributions kick in, and you have more taxable income, there's a chance that more of your social security income will be include-able in your tax and how much you pay in taxes." So it was kind of a roundabout way to scare people. So it allowed us to have the conversation about, for a huge chunk of people, 85% of their social security is going to be include-able in their taxable income, at least how the law is now, and just how other types of income may impact that.
 
Host:
Oh, and that's a great point though. That really highlights exactly the point of this conversation, is that depending on how you phrase things, it's very easy to get misled by stuff. And so that's a great illustration of that, Nick. So thank you for sharing that.
 
And it definitely walks that... And that's what all these are going to do. John, like the next one around Medicare misunderstandings. So my mom's forever, she's 83, she's forever going... And my brother's now, he's over 65, so she's educating him. She's schooling him on the stuff she's been doing for a while with Medicare. And it's like, it doesn't cover everything. And people still sometimes think that, "Hey, at least I've got to 65. Now I've got this Medicare thing. I'm in good shape." And it is a great program, in a lot of ways, but it doesn't cover everything.
 
John:
Yeah, that's accurate. And a lot of people, unfortunately, don't realize that. And a big thing that, when you get Medicare age, age 65, Medicare has a lot of moving parts to it, and there's a lot of different options.
 
Host:
Oh, yeah.
 
John:
So depending on whether you go, let's say, on an Advantage Plan, if you're on Plan F, or G, you get the supplement, it's going to determine what is covered. And then, also, you want to look at, do your current providers even take Medicare? So you might be looking at it and think that you're going to be all set-
 
Host:
Great point.
 
John:
... And then you come to find out that your provider who you like doesn't even take it. So yeah, it definitely does not cover everything. So when you're doing your planning, when we do it, we always try to make sure, "Hey, this is our set price for Medicare." Then we adjust as we determine what plan the client's going to go with or help them determine what's their best option. But also, you want to plan for some out-of-pocket medical expenses for what it doesn't cover.
 
Host:
Yeah, I think she's changed her dentist a couple of times just because they don't take it anymore. They changed or whatever. And of course, dental being one of those things that people often don't realize is, a lot of stuff's not covered there.
 
John:
And prescriptions.
 
Host:
Yeah, and eye. The eye stuff is really interesting. Some of the eyeglass stuff, like going to the eye doctor for just basic optometry stuff is not covered. But then the cataract stuff, some of it was. So it's very strange. So you want to make sure you're understanding what is and what isn't taken care of there with Medicare. So that's certainly a good one as well.
 
Nick, what about the set it and forget it retirement plan strategy. When you're talking about things getting kind of mis-sold or kind of mislabeled out there, some people will be like, "Hey look, you got to get a plan together. You put stuff in there. You let it ride and you roll from there." Right? Well, some things can set it and forget it, but some things can't either.
 
Nick:
Yeah. So kind of a good example of maybe the set it and forget it concept, saw come up a little bit more in the last couple of years, where had some clients that were moving towards retirement, and they had done a good job of saving and building up the nest egg, and they were somewhat familiar with, maybe take 4% a year and I can live off of 4% a year.
 
But with rates being in that point of time where we clicked up, where they could get four to five, five and a half percent in money market CDs, et cetera, they had kind of just said, "Hey, want to shift to the sidelines, want to avoid the market. I'm just going to take my 4-5% and live off the interest." And the conversations that we had to really have were, conceptually, that'll be good for now, for the next year or two. But most likely, there's going to be a point in time within the next three to five years that rates are going to change, and that 5% might turn into 3%, or two and a half percent.
 
And even on, let's just use 2 million bucks. So maybe they could do 5% on 2 million is a hundred grand a year, good to go. Now if we shift to two and a half, 50 grand a year off of the portfolio, with their intention of trying to maintain principle, that starts to rewind a little bit.
 
And so, it's a good example of realizing how the dynamics of a plan change, and that if you're only factoring in what's happening now, or in the next short term, next couple years, that not understanding updating and adjusting your plan to current circumstances, or maybe a broader sense of what could happen, could really put somebody in a difficult position.
 
Host:
Yeah, that's a great point as well. So there's so much stuff you got to think about when you're factoring all these things in. And John, the market's been choppy. The time we're taping this, it's been a little choppy out there. So some of the tariff conversations-
 
John:
Just a little bit.
 
Host:
A little bit, or whatever is kind of making the market uneasy. But chasing and obsessing, not necessarily just over the market highs, but also high dividend stocks. So sometimes people will say, "Well, a good alternative to doing X or Y is to get high dividend stocks." What's some thoughts there?
 
John:
There's different strategies for what you're trying to accomplish. And one of the problems with this one, especially if you're going to retirement and you're thinking of, "Hey, I'm just going to have high dividend paying stocks," is that those things can change. If all of a sudden we have a recession, or the economy's not doing well, or that particular company's not doing well, guess what they could do? They could just change your dividend.
 
So if you had a plan, going back to what Nick's example, they're like, "Hey, I've got this stock. It's giving me 4- 5%," and you think you're okay. And all of a sudden some news comes out and that dividend drops, and now your whole plan just slightly changed. So with dividend paying stocks, they're not guaranteed. And depending on how high of a dividend paying stock it is, the higher sometimes could be correlated with a little bit being more aggressive and more risk.
 
So I've seen, this actually reminds me of a meeting I just had this week, where someone was in talking to a friend of theirs, and they were trying to say, "Hey, just put all your stuff in these high dividend paying rates," and all these things. And I'm looking at it like, "Hey, this is pretty aggressive. You're getting a good yield. But if we have some type of pullback, not only will your dividend potentially go down, but the value of this stock could also drop."
 
Host:
Sure. Yeah.
 
John:
So it's just important to understand what you're in and what could change.
 
Nick:
I think I'd also like to jump in on that.
 
Host:
Sure.
 
Nick:
Because I've had this conversation with some clients quite a bit. And one of the things that I tried to emphasize is that if we look over, because a lot of times the generation that's been drilled with dividend paying stocks is a generation now that's kind of entered into retirement, where they were really starting to invest in coming up through the period of higher interest rates, when dividend paying stocks perform better.
 
And frankly, if you look over the last 10, really post recession, post '09 and 2010 recession, in an environment with lower rates, if somebody was invested the last 15 years in only dividend paying stocks, then the returns that they have gotten are pennies compared to being involved in-
 
Host:
Wow.
 
Nick:
... growth related investments. Think of tech, think of the Magnificent Seven now, think of all the areas of the massive growth over the last 10 or 15 years, and there was significant opportunity cost. So the environment that we're in, where those companies were really rewarded for, the cost of borrowing was low, the ability to reinvest and grow was high. Even when you factor in stock buybacks, I mean, you had companies that were making more money in stock buybacks than they were in producing their own products. So the environment of what's happening has a significant impact on that as well.
 
Host:
That's great points, guys. So it's easy to get lulled into whatever kind of marketing, or whatever kind of news headline, or whatever the case is. So just make sure that you're not falling for it. Or at least not without vetting some things out and talking with your financial professionals.
 
So if you've got some questions, as always, you need some help, you should always run anything you hear by on our podcast, or really any other, even the big talking head shows, talk with someone local in your area about your unique situation so that you're getting some hands-on advice and conversation. And if you need some help, John, and Nick, and the team are available at pfgprivatewealth.com, that's pfgprivatewealth.com. So you can subscribe to the podcast. You can find it there. Of course, you can get some time on the calendar through the website, lots of good tools, tips, and resources. And of course, you can subscribe to us on Apple, or Spotify, or whatever podcasting app you like using.
 
So again, pfgprivatewealth.com. That's going to do it this week. Guys, thanks for hanging out, as always, and breaking it down. Congratulations once again, Nick, on the upcoming nuptials. And John, buddy, have a great week. We'll see you next time here on Retirement Planning Redefined.
 

Social Security Claiming Tips for Diverse Family Situations

Social Security claiming strategies can vary greatly depending on family dynamics. This episode explores how different family situations, such as those with a stay-at-home spouse or a blended family, can impact when and how to claim Social Security benefits to maximize your retirement income.
 
Helpful Information:
PFG Website: https://www.pfgprivatewealth.com/
Contact: 813-286-7776
Email: info@pfgprivatewealth.com
 
Speaker 1:
PFG Private Wealth Management LLC is an SEC registered investment advisor. Information presented is for educational purposes only, and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. The topics and information discussed during this podcast are not intended to provide tax or legal advice. Investments involve risk and unless otherwise stated are not guaranteed. Be sure to first consult with a qualified financial advisor and/or tax professional before implementing any strategy discussed on this podcast. Past performance is not indicative of future performance. Insurance products and services are offered and sold through individually licensed and appointed insurance agents.
Speaker 2:
The rules of retirement have changed. No longer can most of us rely on Social Security or a single pension to fund our futures. We're living longer and retirement doesn't just last a handful of years anymore. Instead, you might stay retired for 20 or 30 years and maybe even more. We need to look at retirement through a new lens with fresh eyes, with a new approach and plan of attack. Here to answer the call, our financial advisors, John Teixeira and Nick McDevitt of PFG Private Wealth Management serving you throughout the Tampa Bay area. This podcast is Retirement Planning - Redefined, and it starts right now.
Marc Killian:
Time for another edition of Retirement Planning - Redefined with John and Nick, financial advisors at PFG Private Wealth. Make sure you subscribe to the podcast on whatever podcasting app you like using. Just type in Retirement Planning - Redefined, or find it online at pfgprivatewealth.com. That's pfgprivatewealth.com, and while you're there, you can book an appointment with the guys right there at the top of the page. Just click on the little tab and get started today. We're going to get into Social Security conversation this week with the guys, some claiming tips for family situations, different kind of family situations that are out there before we get rocking and rolling. Nick, how are you doing, my friend?
Nick McDevitt:
Doing pretty good.
Marc Killian:
Yeah, hanging in there?
Nick McDevitt:
Oh, yeah. Slightly enjoying the cooler weather, but I always enjoy hoodie weather, so I could use a couple more degrees, but.
Marc Killian:
Okay.
Nick McDevitt:
But not too bad.
Marc Killian:
Not too bad. And John, how are you doing with the herd down there? Everybody doing all right?
John Teixeira:
Yeah, everyone's good. Everyone's trucking along. Yeah, my daughters are in karate, so they're enjoying that.
Marc Killian:
Oh, nice.
John Teixeira:
And debating what the next step is for one of, actually, they run around kicking me all the time now.
Marc Killian:
Yeah, they're going to ninja flip you all over the house.
John Teixeira:
Nice. I'm trying to get my youngest one into flag football so I just bought her a football and throwing it.
Marc Killian:
Very nice.
John Teixeira:
My wife's like, "No, no, she's doing softball."
And I'm like, "Whatever."
Marc Killian:
Nice.
John Teixeira:
So we're trying to get her into some sports here, so it should be fun.
Marc Killian:
Good, good stuff. Good stuff. Well, since we're talking about families, let's talk about the Social Security breakdowns on some things. Claiming strategies vary, obviously from dynamic to dynamic. In this episode, let's just run through some stuff. I guess we'll start with the broad view, fellas. Social Security claiming strategies, there's a lot of it. I mean, it can get a little overwhelming, which again is important to work with somebody who has some experience in this. Whoever wants to tackle that, what's your thoughts on just the sheer number of claiming strategies that are out there?
John Teixeira:
There's a lot. There's a lot of them, but it really boils down to a few that you end up doing. I think the most important thing is to understand your current situation, whether it's the discrepancy of what the income's going to be for each person. If you're filing jointly or you have two people taking Social Security and understanding what the need is at the time. Do you need income right now? Can you hold off? But there is a lot of different options to pick from. The best thing is to review what makes sense based on the plan, and then also at this current time what you have going on.
Marc Killian:
Yeah, I think a lot of people view it as, well, we've got this collection. We've got a 401(k) and this, that, or the other that we've personally saved. Oh, and Social Security versus maybe looking at them all together holistically in one overall strategy. It should be thought about and we're going to talk about that in the way you set up your income structures. Nick, I guess I'll let you take over and get this first one. Let's look at it from a single income household consideration. We don't see this as much anymore, but maybe it's just one person that goes to work and the other person stays at home, which is totally fine, but what's some things to consider in that unique situation?
Nick McDevitt:
The timing of the benefits are super important. Number one, the golden rule in retirement planning or financial planning is it depends. From the perspective of I think one of the biggest drivers in a single income household is going to be age difference between the two, and that has the biggest impact on the claiming strategy. Ultimately, any of these Social Security decisions come down to their function of other assets and the impact of the timing of the Social Security benefits and how that's going to take into account. But if we were to pick one thing from the standpoint of survivor benefits is a good example. A lot of people are under the impression, or I should say the feedback that we've gotten from many people is not having a good understanding of how survivor benefits work. The reality is that survivor benefits are when one passes away, the surviving spouse gets to the higher, the two benefits, the lower one goes away.
Marc Killian:
Right.
Nick McDevitt:
Oftentimes obviously if it's a single income household, the person that hasn't worked, their benefit's going to be lower, it's going to be half or even less depending upon when they take it. We'll go through and use, we have some calculators that we'll work with with clients, put their specific situation in there, then use those numbers and overlay them with the plan to help them try to figure out the most efficient way to do it. We always say to them that there's the top financial strategy and then there's the we have to try to balance that with the I want my money and I want it now strategy.
Marc Killian:
Right.
Nick McDevitt:
When it comes to Social Security, there's something to it from the perspective of people putting in the money over years and really wanting to get access to their money quicker. That's how we go into most of these strategies is overlaying it with the plan and looking at how it's going to work.
Marc Killian:
Well John, let me ask you a couple of follow-up questions on the single income household side. I think there's some confusion too. I typed this in the other day when I was putting these together and I saw this, I think it was, I don't know, Reddit or something feed where people were back and forth and they didn't seem to, there was a lot of misunderstanding about if you didn't work, could you get Social Security?
People were saying, "Well, you have to work the 40 quarters in order to qualify for Social Security," which that's accurate for your own.
However, and then somebody else would follow up and go, "Wait a minute, my grandmother who never, ever had a job gets Social Security. How is that possible?"
I think there's confusion out there that if you're a single income household, if you've never worked, you can claim against your spouse, correct? But they have to have already activated it for it to start, is that correct?
John Teixeira:
You get the spousal benefit. Correct me if I'm wrong here, but I believe you have to be married nine months in order to receive that.
Marc Killian:
Yeah, correct.
John Teixeira:
In reality, most people will get that as a spouse.
Marc Killian:
Sure.
John Teixeira:
I had one situation actually where someone got married, they didn't qualify and the spouse died after eight months.
Marc Killian:
Oh, wow.
John Teixeira:
So they did not qualify anymore. You do have the spousal benefits, which is half of the earning or the qualified spouse's, what they call full retirement amount.
Marc Killian:
And they have to turn it on first, right? That's a bit of a sticking point. If you're the worker, you have to claim Social Security before the spouse who never worked can also get their half, correct?
John Teixeira:
Yeah, Marc. That is accurate. To receive a spousal benefit, the spouse that is qualified has to be drawing on benefits. The person receiving the spousal benefits has to be past 62. The big confusion on this was in the past, you could do some strategies like file and suspend where the person didn't have to be drawing it just yet, so you do some strategies. But they closed those loopholes about six or seven years back, which ultimately was a loophole that needed to be closed to help the longevity of the program but a lot of people weren't happy because it was probably the best strategy out there to use. But good news is it helps longevity of the program. Bad news, you can't do it anymore. But some of the confusion comes into play where people that have already done the file and suspend are grandfathered in.
Marc Killian:
Gotcha.
John Teixeira:
Circling back to the spousal benefit, spouses are entitled to half of their spouse's full retirement benefit. They can drawing at 62, and their spouse has to have started drawing on it themselves.
Marc Killian:
Yeah, gotcha.
Nick McDevitt:
And if they do receive the benefit, if the spouse that hasn't worked and is receiving the spousal benefit, if they take it before their full retirement age, then there is a reduction.
Marc Killian:
There's a reduction as well, right.
Nick McDevitt:
There's a function there. The only other thing I want to mention for the single earner is, single income is if somebody was married for at least 10 years and then are divorced and not remarried, they are eligible to, and maybe they never got their 40 quarters, they are still eligible for a spousal benefit.
John Teixeira:
To jump on that, because this has come up quite a bit with clients, if you're divorced and you're eligible for spousal benefits, you do not have to wait for the person to be drawing. As long as they pass the age of 62, you can draw. Part of that is because you might have some vindictive spouses that are waiting to draw to make sure their ex doesn't get the spousal benefits.
Marc Killian:
Well, and we're going to talk about that in a minute as well. There's a couple little things, little caveats there. To our point, kicking this off, there's a lot of nuance to Social Security. We're going to try to keep it high level a little bit and not get too confusing. Again, it's important to talk to somebody, but those are some basic things to think about from that single standpoint.
Let's go to the dual income households, which is most people, guys. John, you talked a little bit about file and suspend and while it's no longer an actual strategy, what I know a lot of advisors often talk about with their clients who have dual income is if one person is making more, then maybe you're letting that one grow to 70, right? To the max out. And then the person who's maybe making less, especially if they're the same age, maybe then you're looking at turning that on earlier, whether it's full retirement age or even 62 depending on the money needs. That's a workaround I suppose, to the file and suspend a little bit. That's some things to think about. So what's some other things to think about and dive into wherever ever you want on dual incomes there?
John Teixeira:
Again, rule of thumb is just overview versus individuals, but it does make sense to always suspend the higher benefit, whether if you're dealing with a survivor benefit, there's some strategies. You have the dual income spousal benefits, you want that extra compounding on the higher amount is basically why you want to do that.
Marc Killian:
Right.
John Teixeira:
Another strategy for that and why you might want to delay the higher benefit is the survivor benefit is going to be higher. You can in essence defer someone's benefit till age 70, and if they were to pass away, the survivor benefit now has that increased amount so that is one option you could do. As you mentioned here, you could take a lower benefit earlier, let the other one go. If you have two working spouses, but let's say someone's benefit isn't as high as their spousal, you could look into someone taking their own benefit at 62 and then switching to the spousal later. There's definitely a lot of different things you can do. And a reminder of what Nick said, anytime you take early, you are going to get a reduction of benefits.
Marc Killian:
Yeah, 30% currently, right.
John Teixeira:
Yeah.
Marc Killian:
That's a big haircut-
Nick McDevitt:
Depending upon your full retirement age.
Marc Killian:
From your full retirement age, yeah, it's a big haircut, 30%. To your point earlier guys, when you're building a strategy, because I guess Nick, part of this is looking about where are you taking money from, right? You've got your 401(k), you've built up your personal, then you got your Social Security, and it's like, okay, when are we turning on what and where so that we can maximize this? It's like, which horse are you riding? The one you brought or the one the government brought kind of thing.
Nick McDevitt:
This might be a little bit too detailed, but really, what we do from our standpoint as an advisor is we use the withdrawal rate as the test to figure out. When we look at the overall portfolio and we go through the expenses and we figure out how much income a client's going to need on an annual basis, let's say that delaying Social Security is going to force them to take a 10% withdrawal rate. For three years, they're going to have to take out 10% of their money out of their portfolio a year to cover expenses to delay. That number's probably too high. For most people, that number's probably too high.
If it's something around a max of a seven or eight, and it's only going to be for a couple years, depending upon the size of the portfolio, that can make sense. But when there's just too much pressure on the portfolio to perform, then oftentimes just at least getting one of those Social Security benefits and that's why staggering the two oftentimes makes sense. It's like, okay, well if a 10% withdrawal rate is what's needed, then if we can reduce that down to a seven for a couple of years by taking one and then drop it closer to a four and a half, five after a couple more years and stagger it, that's the ideal.
Marc Killian:
Gotcha.
Nick McDevitt:
It really is a function of portfolio like the nest egg number, the expenses and what we need to take out to cover those expenses and what the gap that Social Security benefit's going to provide.
Marc Killian:
Gotcha, okay. Yeah, so I mean, again, there's really a lot of nuance to figuring out. Most of us are going to probably fall into this dual income household planning strategy. You want to make sure that you're working with someone to just maximize things based on what you've built yourself, plus what we're going to get back from Social Security. Can we talk about a lot of money over time?
John, you talked about ex-spouses earlier, so let's talk about special considerations for blended families or people who have gotten a divorce and remarried or whatever. I'll throw this out there as well. So my mom found, and Social Security, people that work there, they're not supposed to, typically they're not going to help you with their claiming strategies, right? They're going to give you the options available for you, but it's not really their job and they're not really supposed to be diving into the weeds. But I will say, that said, there was a lady that helped my mom. She was asking her a question, and she informed her, and a lot of people don't know this, that you could claim on an ex-spouse, right?
To John's point earlier, and so she found out she could actually get a higher benefit, she's in her eighties, by claiming from her first husband who she hadn't been married to in a very long time. But there are some caveats and rules to that. It could be something that you consider doing in your claiming strategy as well, especially if you're a widow or you're single. You have to be single obviously in order to do that, that's one of those caveats. But talk to me a little bit about some of that stuff. It was interesting, she found out she could get more money. And to your point about the vindictiveness, they don't ever know.
So when you claim, they don't find out, they don't get to come to your house and go, "You're claiming against my Social Security." They don't even know.
John Teixeira:
Yeah. That's something that comes up where I guess some misinformation or I don't know how this comes up, but it's somewhere out there where I've had clients ask, "Hey, is my ex-spouse drawing on my Social Security going to affect mine?"
The answer's no. What you just said there, you would never know when they draw on your Social Security, it's not going to affect yours whatsoever. And vice versa, where it's like, "Hey, will they know when I start drawing my spousal benefit?"
Marc Killian:
Yeah, can I stick it to them? Like, "No."
John Teixeira:
No, you cannot. And then one thing you mentioned earlier, Marc, when you were going through that is you can draw an ex-spouse as long as you are not remarried.
Marc Killian:
Correct. And I think you had to be married 10 years, right? To the prior person. Yeah.
John Teixeira:
Yeah, you have to be married 10 years and you cannot be remarried. I've had situations where people did not remarry to take a spousal benefit. They just let it ride and said.
Marc Killian:
Mom being in her eighties, she was like, she's not getting remarried anyway. But she was like, "Huh, I didn't know that."
To your point about not knowing, one of my siblings was like, because we're half siblings, "Well, that's not cool. She's drawing against my dad's."
I was like, A, he's never going to know. B, actually, he's never going to know because he's passed away anyway, right? It's a weird little loophole, but it is one that could be beneficial, and a lot of times I think it does benefit widows sometimes who maybe have been, maybe their second marriage and then that person passed away. It is something to consider if they had a prior husband who maybe made more money. It could be an option to look into, but there's some rules and there's some things, so you want to make sure you're talking with somebody about that.
John Teixeira:
Yeah, the most important thing is let's say you are in that situation where you have an ex and currently doing this right now, you have to go to Social Security and provide them with the information so you can determine what their benefit actually is. And if you have multiple exes that qualify for you get to pick and choose whichever one's higher if you're going to be doing a-
Marc Killian:
But you do have to have the paperwork to your point, yeah. You have to show-
John Teixeira:
You have to have the paperwork and everything like that.
Marc Killian:
Yeah, to show.
John Teixeira:
Definitely there's a lot of options, information out there, and it's important to do your due diligence. And if you do call Social Security, and we're going to say this every single time we do a Social Security podcast, sometimes they give you bad information, unfortunately. It's important to make sure you're working with the qualified professional that knows it, and you might want to call multiple times to confirm what you're hearing.
Marc Killian:
Well, speaking of, that might be a good time to bring up the fact you guys got something going on. What's going on there? You got an event or a class or something?
Nick McDevitt:
Coming up at the end of the month in January, a fair amount of our clients have come to us through the classes that we do around at different educational institutions. But starting on January 30, it's a two night course, so two and a half hours on the 30th, and then two and a half hours on the following Thursday. And then concurrently, we also run day one of the course on the 4th and the 11th of February.
Marc Killian:
February, okay.
Nick McDevitt:
It'll be at Pasco Hernando Community College, the Porter Campus up in the Wesley Chapel area. We've got clients that originally went to the course and then sometimes like to go back and freshen up. We have other people that have come to us, whether it's a referral or heard the podcast or whatever, and they find out that we do the class and they like to join. So more than welcome, just reach out to us if it's something that you're interested in.
Marc Killian:
What's the best way to go about doing that? Just go through the website or call a number?
Nick McDevitt:
I would either call our office, (813) 286-7776. Or they could email either John or myself, it's nick@pfgprivatewealth or john@pfgprivatewealth.
Marc Killian:
And again, that number if you need to, folks, is (813) 286-7776. Or email John or Nick and then @pfgprivatewealth.com. All right, that's going to do it for this week on the podcast. Thanks so much. So yeah, great. If you'd like to attend that event, I mean at the time this podcast is happening, you want to jump on the February one. But definitely reach out to them ASAP, don't delay and get yourself in there because a lot of stuff that goes into Social Security. Make sure, as John said, that you are talking with the professional who can help you with this and you can reach out to them at pfgprivatewealth.com or the information we just gave. Check the show notes below for links and information that way as well. Don't forget to subscribe to us for future episodes of Retirement Planning - Redefined with John and Nick from PFG Private Wealth. We'll catch you next time. Thanks guys.
 

New Year, New Me: How To Change Your Money Attitude In 2025

As we kick off 2025, a lot of people consider what they want the year to look like and how to put their best foot forward, especially financially. Think: “new year, new me!” To figure out what the new “you” is all about, sometimes it helps to reflect first on what you’ve done in the past and what you want to change moving forward. Today, we’ll talk about the financial decisions and habits you’ve maybe had in the past and what changes you can make this year to embrace the new you.
 
Helpful Information:
PFG Website: https://www.pfgprivatewealth.com/
Contact: 813-286-7776
Email: info@pfgprivatewealth.com
 
Disclaimer: PFG Private Wealth Management, LLC is an SEC Registered Investment Advisor. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. The topics and information discussed during this podcast are not intended to provide tax or legal advice. Investments involve risk, and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial advisor and/or tax professional before implementing any strategy discussed on this podcast. Past performance is not indicative of future performance. Insurance products and services are offered and sold through individually licensed and appointed insurance agents.
 
Speaker 1:
It's time once again for another edition of the podcast, Retirement Planning Redefined with John and Nick, financial advisors at PFG Private Wealth. And you can find them online @pfgprivatewealth.com. That's pfgprivatewealth.com. And we are into the new year. It is 2025, which still sounds weird to say. And we're going to do that new catchphrase in the last couple of years has been that new year, new me thing. So we're going to do that with our money. Now, I know it's the middle of the month already and you think, well, you should be doing this like the first week. But I was thinking about this, guys, I think January 16th I think which is the day we're dropping this podcast, I think that's actually officially quitters day if I'm not mistaken. But they have a term for it, people who set a resolution and then quit within two weeks. So I thought, well, let's wait till now and then we'll do our money attitude changing hopefully.
 
And that way hopefully people will stick with it when it comes to following their resolutions through. So let's get into it this week. John, how are you doing, my friend?
 
Speaker 2:
I'm doing all right. How are you?
 
Speaker 1:
Doing pretty good. Are you a resolution kind of guy? Do you set those?
 
Speaker 2:
I don't think I've ever set a New Year's resolution.
 
Speaker 1:
Really? Okay. All right. What about you, Nick? You doing all right?
 
Speaker 3:
Doing pretty good. I can't say that I am a much of a resolution person either.
 
Speaker 1:
Okay. Nothing wrong with that.
 
Speaker 3:
Yeah, but trying to do a little bit better, set some goals not necessarily New Year's resolution.
 
Speaker 1:
Well, I will say this, I'm not a resolution person either, but I did set last year as like I wrote four things down I wanted to accomplish in 2024. And I actually wrote it down, which I never do, and it actually kind of worked. So I kind of did stick with it and I got all four things accomplished. So I tried it again this year. So we'll see how it pans out.
 
Speaker 3:
Yeah, there's definitely science behind it, write it down and everything.
 
Speaker 1:
Yeah. So with that said, guys, what we're going to do is we're going to do that kind of attitude and we're going to do that kind of conversation piece here with finance. So if you're in that kind of new year, new me camp, this might be right up your alley. So guys, I'm going to give you the old you, like what maybe the old version of yourself might be saying. And then you give us the new you spin. Okay, so how to take it in that direction we want to improve on. So John, we'll start with you. So the old you might be like, man, I live beyond my means. I know I'm overspending. I got to get that under control. And A, first step is if you can accept that and admit that that's already a great thing, but what else should you be doing if you're trying to get into the new me?
 
Speaker 2:
Yeah, I think a first step for that is really take a look at where you're spending your money and prioritize what do you want to be spending on? So you kind of look at last year and say, "Hey, a lot of this stuff was unnecessary. I really didn't need it. Could have done without it." And maybe there was a little bit of guilt when you purchased it or did whatever you did. So I think prioritizing is step one. Setting a little bit of a budget. It doesn't have to be strict, but something that you could at least track as you just mentioned there, you wrote down some goals and it kind of helped you out. Same thing with this, write down where's your money going. And as I said, if something gets tracked you can definitely take a look at it and see where you can adjust it. And the hardest thing for most people and I've fell into this category at times, is kind of impulse buying.
 
So definitely figure out how to stop that, whether it's you see something you want, put it down for a second, take it out of the car and give yourself a day or two. And if you really like it, maybe go back and get it. But definitely stop yourself from that impulse buying.
 
Speaker 1:
Yeah, it can certainly get us.
 
Speaker 3:
Yeah. I would say too, one of the things that a conversation with some clients recently is those that maybe have a little bit of trouble from the spending standpoint, a lot of times they don't really have too good of a system for how they do spend. Meaning not necessarily setting a budget, but sometimes people will whipsaw from any sort of budget. I know that's kind of how I react. But having a plan of attacks. So for example, if we see people that use their debit card for a quarter of things, one credit card for gas, one credit card for publics, one credit card... And try to get all spread out, they oftentimes end up spending way more money than you realize.
 
Speaker 1:
Yeah, that sounds like a recipe for disaster for me at least.
 
Speaker 3:
Yeah. And so especially with clients that are one to two years out from retirement, more and more we encourage them to have the household use a single credit card that the website has a system where we can do an export or a data dump at the end of the year. It'll categorize the expenses for us, and we can kind of look from year to year and use those same categories that are a part of their card, to help them really see what's going on from year to year standpoint [inaudible 00:04:52] clients.
 
Speaker 1:
Yeah. And certainly you could do that with one card, you could do some points. I think if you can manage that stuff and then you can use that for flights and trips and things that... You can certainly kind of couple that credit card idea in there. But multiples for individual things, that definitely sounds like a recipe for disaster. So, all right, good job guys. I like that. So prioritize what you need if you're overspending or living beyond your means, maybe that wants versus needs list kind of thing. And to John's point, to curb those impulse buys, they can certainly get you. All right, so let's go to the next one here. The old you, now this might be a little bit more for our folks that are getting closer to retirement or maybe even into it guys, they are great savers. The old you has saved maybe even to a fault.
 
And I think a lot of retirees struggle with this, and you guys can talk to this point. But they don't now feel comfortable using it and enjoying it. They've gotten so grooved into saving for 40 years, they don't want to touch it. So how do you get that mindset to change to go, hey, this is what I worked for, let's enjoy this money in the new year, the new me, right?
 
Speaker 3:
Yeah. Fortunately from an advisor standpoint, we do run into this because it's a little bit easier of a conversation to have with clients versus the overspending one. But this is really kind of where we can focus on the planning, where the software that we use with us being kind of a planning focused firm, we really kind of go through stress test the plan, show them, hey, we've kind of planned for multiple different scenarios, try to have them zoom out a little bit. And again, just like a lot of things it ends up kind of being little psychological things that need to be done to make adjustments where they feel better, where maybe it's increasing their monthly distribution from their investment accounts so that when it's in the bank, they feel a little bit more comfortable spending it. Sometimes too, just playing games. We talked about using the credit cards as a consolidate and obviously pay off every single month.
 
But we've had a conversation with a client that liked to travel a lot. Her daughter had been pushing her to, instead of going on flights that... So from the outside you would look and see, okay, they travel a lot, they go do fun things but maybe it was all day of flying because they had two layovers or three layovers because they wanted the cheapest plane ticket. And so, hey, what are things that you can do to give yourself the permission to make that process a little bit easier for you? And sometimes that's points things. Sometimes it's just saying, "Okay, it's all right to spend a little bit more to make this process easier for you, so it's more enjoyable for you."
 
Speaker 1:
Okay. Yeah, and John, do you run into that sometimes where it's just convincing them, or maybe it's just showing them in black and white, "Hey, it's okay to spend this money. I get it, you've saved and you hate to see it go down and you're worried you're going to run out." But sometimes it's really just more of that just kind of coaching, I guess, just to show them it's okay to do this.
 
Speaker 2:
Yeah, that comes up a lot more than you would think because most people head into retirement. It's like, oh, now it's time to enjoy it and do the things I want. But that fear of running out money really sets in. So reviewing the plan, as Nick mentioned, really gives the most peace of mind. So I'll tell you, when we do our reviews and it's like, "Hey, this is kind of what you're set to have at the end of your plan.' It's like, "Okay, I feel comfortable spending then." And then it's always a good reminder to say, "Hey, if you're not going to spend it, I'll tell you your beneficiaries are going to spend it." So I think it's important that you enjoy yourself while you can. And most people, once we see the plan and we have that conversation, it's a kind of push to do it.
 
And unfortunately, next year it's another push to do it but it's always a good conversation. I'll tell you the ones that where it clicks, they're very appreciative of that conversation. It's kind of like, "Hey, appreciate you letting us know we're in good shape and we can kind of splurge a little bit more and do the things we want."
 
Speaker 1:
Yeah, and that's the point of coming back in for the updates and the consultations and the reviews. So you can keep track of that and make sure that you're feeling a little bit better about it. And yeah, to your point, what's the old saying, if you don't fly first class your kids will whenever they inherit the money.
 
Speaker 3:
I haven't heard that, but I'll start using that.
 
Speaker 1:
Oh, okay. Well, there you go. Yeah, start using that. If you don't fly first class in your retirement, your kids are going to whenever you leave them the money. So all right guys, so good job on that. Let's do another one here. So old you, I don't really know what I have or where it's at if I'm being honest. So a lot of people are in this camp where I got stuff, but I don't really know why I have it, where it's at and truly how much it is or how it works. So if the new you is trying to get better financially, whether you're still working, a pre-retiree or a retiree, what's some things to think about? John, you take off with this one first.
 
Speaker 2:
Yeah, so again, going back to the reviews, this happens quite a bit. As much as you show someone their plan, their net worth, this is what we do for a living so it's constantly on our minds, but the average person probably isn't thinking about their balance sheet or their net worth. But again, back to importance of doing your annual reviews or semi-annual reviews, it's a reminder of, "Hey, this is what I have and here's where all my stuff is." Because it can get confusing where you're talking about, hey, I have an account for this and then I have an account for income and I have a pension coming in. It does get, I would say, overwhelming. But when you have that plan, it's easy just to see it when you're with your advisor or if they have the tools and technology where you can just kind of log into a website or an app and you can just see it immediately. Typically, helps set people at ease.
 
Nick and I just got an email this week, similar thing. And we do our annual reviews and semi-annual reviews and check-ins quite a bit, but it's always nice for them. It's kind of a conversation of, "Hey, I don't know where anything is." We sit down, it's like, "Okay, great. I appreciate you guys. Thank you so much for sharing this and kind of walking me through it again." Because this is what we do and the average person it's not what they're thinking about day to day.
 
Speaker 1:
Yeah, for sure. Right. Good ahead, Nick.
 
Speaker 3:
I think the client's really trying to become more familiar with technology and using those tools that... because we do set those things up for clients so that they're able to check in on those things. And some like to see it, some don't like to see it, just kind of want the affirmation that things are okay. So it all just depends. But technology luckily has made it a lot easier for those that want to be more involved to be involved.
 
Speaker 1:
Yeah. And think about just not knowing where things are at and stuff like that. Especially if the loved one who is handling all that, which is typically the way it works, passes away. The one person it seems like that does this particular thing or whatever goes first, and then the other person's left holding the bag a little bit more. So having a good 30,000-foot view of things and knowing what you have, why you have it, where it's at. Important. Good stuff. All right. All good.
 
Speaker 2:
Yeah, Mark. And just to kind of touch on what you just said there, that happens quite a bit where a lot of people come to us and whether it's one spouse or the other. And it's, "Hey guys, I want to work with you. Very important we develop this relationship because if something happens to me, I want to make sure that my spouse has someone they can call on where they know everything that's happening."
 
Speaker 1:
Yeah, know where to turn, get some help because you're already dealing with a lot obviously. But being completely behind the eight-ball and not even knowing what's going on with your money makes it even worse. All right, let's do this, let's see if we can do one or two more guys here and then we'll wrap it up for the new year, new me conversation. Old you, until things settle down, I'm going to pause on my investments. We've seen this a lot last year, so I'm going to pause putting money in my 401k if I'm still working because it's so crazy out there. There's the election, there's the volatility, there's the wars, there's the whatever. That's just nuts to me because when is life ever... If anything we've learned since 2020, nothing seems to settle down in the last five years. So Nick, if you're trying to do the new, what's your recommendations for the pause until things settle down kind of person?
 
Speaker 3:
Yeah, you kind of referenced it from the standpoint of 2020, COVID, pre-COVID, post-COVID. We're almost four or five years post the beginning. And so the conversation that I'll oftentimes have with people is, yes, certain things may seem a little chaotic, but let's kind of rewind and let's talk about what we've been through over the last four or five years. And so in retrospect, does now really seem super chaotic and-
 
Speaker 1:
And more so than it was.
 
Speaker 3:
Yeah. And the important part of realizing that China time things rarely works, just kind of having the overarching plan, continuing to average into the market. And that the market tends to be resilient, especially with how money was printed during that phase of time. And so a market continues to be resilient. And for those that did decide to maybe sit on the sidelines, what is oftentimes even more stressful for them is kind of the re-entry and chasing, chasing returns, chasing timing. And then all of a sudden you look back and you have half the money that you could have had. So it's tricky.
 
Speaker 1:
Well, think about just people who, John might've even said this for the election, leading up to the recent election here this past November. Well, look at what the market's in the last two years, the S&P of the last two years was 20 plus percent. And if you were sitting on the sidelines because you were worried of what the election might do to it, you're kind of kicking yourself in the butt.
 
Speaker 3:
Yeah, and that happens a lot. And again, because sometimes people will make that initial decision, hey, I'm going to wait. Hey, I'm going to sideline some of this money. And it's one thing to do a certain percentage, that's fine. But maybe make a broad, really big decision and trying to then readjust that decision is even harder than the initial one.
 
Speaker 1:
Yeah. And I said, John, I meant to say Nick, apologize about that. But John, what's your thoughts on it?
 
Speaker 2:
Yeah, I've been saying things are going to settle down for me for the last five years.
 
Speaker 1:
Have they?
 
Speaker 2:
No, they haven't.
 
Speaker 1:
Right.
 
Speaker 3:
That's what he keeps telling me and I keep waiting.
 
Speaker 2:
Right. Yeah, no, I think there's always something happening. So I think the best time to start doing stuff is the present. There's always going to be something coming up. There's always going to be something why you shouldn't invest or why you should do whatever you got to do. So I think then the best action is save what you can and just continue to save. You'll be in a much better position and happier at the end.
 
Speaker 1:
Well, isn't that the point of your risk analysis anyway? Because something's always going to be going on. So if it's riskier right now and you want to pare back some risk, cool. But just wholesale jumping out, especially when you're thinking about just the dollar cost averaging, just the fact that you're losing over time by not putting in... If you're still working, you're not putting in your 401k because you're worried about what the market's going to do, that's just goofy. Especially if you're missing out on the free money from business and matching money from the company you might work for. So just lots of reasons to have a conversation. Again, to sit down with a professional if you're worried, if you are stressing over when's the right time to do this or that. Sit down with somebody so that you can kind of build a plan based on your comfort and tolerance level.
 
That's part of that, which really leads me to my last one, guys. If you're one of those folks that are in that, I have no financial plan. My parents didn't have one and it worked out for them I guess, so I'll just hope for the best. Many of us do this in the old you camp. So whoever wants to start with this one, I guess, John, I'll let you start with this one. If you're trying to do the new you, make a new resolution to get better financially and you're hoping for the best, that's not the way to go. So we've talked about it multiple times, but what should we do?
 
Speaker 2:
Yeah, definitely like I just said something's always going to be coming up and the present's the best time to start doing stuff. So we definitely recommend starting a financial plan. If you're just getting into it, maybe it doesn't to be a full comprehensive one, but something where it's just some type of outline, some type of goals you can start setting for yourself using... I'll say times have changed. My parents both had pensions and they were very blue collar old school, so they didn't have a plan. They just kind of went to work, got their pension and retired which most people could have done back then.
 
Speaker 1:
Sure. It was great.
 
Speaker 2:
Yeah. Now with pensions, pretty much for the most part, I don't want to say gone, but very limited to a select few, the responsibilities on the individual to be saving. And there's a lot more stuff going on now than there was 30, 40 years ago. So planning is very important and making sure you're on track, and hitting your goals and saving money is more important now than ever.
 
Speaker 1:
Yeah, for sure. And Nick, I'll let you have the final word here. You've got to take some kind of action. Hoping for the best, hope is not a strategy.
 
Speaker 3:
Yeah, we were talking about sayings earlier and I think there's some sayings out there about hoping without any action too. But from the standpoint of how things were versus how they are now, and John kind of covered the pension versus no pension. One of the other things are even if you decide, hey, from an investment standpoint you want to pick your own investments, that to kind of do it yourself, there are more tools than ever before to be able to do that. Whether it's targeted funds, index funds, the financial world has made it easier for people to engage. So that's a positive. But I'll say that I think the most alpha or the biggest benefit that people have is taking control of a strategy.
 
And that's really the biggest difference. You could take two people side by side, and if you were to break them down in 10 different variables and one of the variables that's different is kind of having a plan and not, they could have same income, they could have a lot of the same sort of setup. The person with the plan is going to outperform substantially. And that's just kind of how it is. So can't emphasize that enough.
 
Speaker 1:
All right, so before we wrap this up, guys, since we're talking about New Year, new me, Nick, tell us a little bit about the upcoming course you guys got going on at the end of the month. Folks want to attend. This would be a great way to kick the new year off, right?
 
Speaker 3:
Yeah, so we do the course and have been doing it for years. It's called Retirement Planning Today. It'll be up in Wesley Chapel at the Porter campus. It'll be starting on Thursday evening, January 30th from 6:30 to 9:00 PM. That'll be the session one. And then session two is the following Thursday, same time, same place. And if Thursday nights don't work, we also run it on Tuesday nights. It'll be February 4th, 6:30 to nine, and February 11th, 6:30 to nine. If anybody's interested, wants to go, just reach out to us directly. You can call our office at 813-286-7776 or email either John and myself. It's just our first name, nick@pfgprivatewealth.com or john@pfgprivatewealth.com.
 
Speaker 1:
All right, there you go. So if you guys want to attend that upcoming retirement planning workshop, that class, then definitely reach out to them. Let them know. Good stuff there. And that's going to do it this week for the podcast. So again, find them online @pfgprivatewealth.com or call the number as the guys mentioned, 813-286-7776. We'll catch you next time.