Episode Transcript
[00:00:00] Speaker A: Any examples used are for illustrative purposes only and do not take into account your particular investment objectives, financial situation or needs and may not be suitable for all investors. It is not intended to predict the performance of any specific investment and is not a solicitation or recommendation of any investment strategy.
[00:00:27] Speaker B: Welcome to Retirement your Way with Amerilife of Central Florida, the show that puts you in control of your financial future. Your hosts, Bradley and Madison Hardin, are a trusted husband and wife team dedicated to helping you design a retirement that fits your lifestyle, your goals, and your vision for the years ahead. From smart income strategies and Social Security planning to protecting your wealth and living life on your own terms, this is the place where financial clarity meets coastal confidence. Whether you're just entering the retirement red zone or already enjoying your golden years, Bradley and Madison are here to guide you every step of the way. This is retirement your way. Let's build the future you deserve.
[00:01:12] Speaker A: Hello, and welcome to another edition of Retirement your way with the Marilife of Central Florida. I'm Matt McClure here with you. Just kind of, you know, pushing buttons, making sounds happen, that kind of thing. The real star of the show this time around, though, is Bradley Hardin with Amerilife. Hey, Bradley, how's it going?
[00:01:27] Speaker C: I'm doing well, Matt. How are you doing today?
[00:01:30] Speaker A: I am doing very well today. You know, I'm doing well pretty much anytime we're able to get together and talk on the radio and on the podcast and, you know, we've got a subject today here on the show that I feel like is going to give people a lot of peace of mind because it has to do with. It's a word that you don't hear often in the financial world. And that word is. Is guarantee. It's like a. It's kind of like a forbidden, kind of a taboo sort of dirty word in a lot of areas. But we're going to talk about, like, the guarantees that you actually can get to in your retirement plan, right?
[00:02:04] Speaker C: No, I know. And you know, in investment planning and portfolio designs. Oh, look how good it did. Hypothetically.
You know, I can't predict the future and all this fun stuff. Well, no, no, let's get some guarantees in there. Let's make sure that in black and white, it's going to do what it says it's going to do and.
[00:02:21] Speaker A: Yeah, exactly. It's called results in advance planning. Really is what we're talking about here is like, you know, getting some. Some guaranteed income sources, some guaranteed growth in there, guaranteed, you know, principal protection. All of those things so that you can then have a retirement that you have dreamed of, the retirement that you want to live your way. So we'll get to all that just momentarily. First, though, I want to say thank you so, so much to everyone listening to the show. If you are out there listening on the radio in coastal Florida, around the Daytona beach area, Ormond be, Smyrna beach, all around that area there. We thank you so, so much for that.
Also, if you are listening to us via the podcast, wherever you get your podcasts, thank you. And if you haven't discovered the podcast feed yet, you can either go on your favorite podcast app and just search for retirement your way, or you can go online to the website, which is plan retirement your way.com plan retirement your way.com and you can see past episodes of the show there. And you can also request a free consultation with Bradley and his wife Madison, with a married life of central Florida. All you do is go to the website, plan retirement your way.com is what the address is. Once again, it's right there on that homepage. A very easy thing to do is request that consultation or if you prefer, you can actually ring them on the phone. Imagine if that thing in your pocket that you use to like browse the Internet and look at social media, it still works as a phone. And so you can do that as well. Well, give them a call at 3863-206406-38632-06406. And Bradley, that goes directly to you. That does not go to some, you know, overseas call center or something like that, right?
[00:04:05] Speaker C: No, absolutely. And we wanted to make sure that when people hear the show, they know that we're local and when they pick up the phone to call, they're going to get me directly. You know, Madison and I, we live in Daytona, the Daytona beach area. The kids go to school here.
So again, we are local to the county, to the city. And we didn't want to make, we wanted to make sure that when you picked up the phone to call, it wasn't like you said, Matt, to some random call center, some person who has no idea what you're talking about. So again, when you give me a call at 386-3206-406, just be assured that you're calling me directly.
[00:04:40] Speaker A: Yeah, absolutely. Right. Well, okay, Bradley, give us the rundown of what we're going to talk about here over this next half hour.
[00:04:48] Speaker C: So today's show is, it's a good one. These are always great shows. And today's outline is, is nothing different.
So today it's going to be building a results in advance retirement plan.
We'll share three steps to a retirement plan that minimizes fees and taxes and generates guaranteed income.
A New year's curveball for 401k catch up contributions. So we've got details on what's changing and how you can respond and some retirement red flags. So common mistakes to avoid as you leave the workforce. And if we've got time at, you know, what happens when you work with us. And also potentially some news that you can use now, a part of every show, in every intro, we have some financial wisdom quote of the week. And so this week, Matt, I'm going to let you read it off to the listeners.
[00:05:41] Speaker B: And now for some financial wisdom. It's time.
The quote of the week.
[00:05:48] Speaker A: I'm gonna let you guess after I say it. I'm gonna let you guess who this quote comes from. All right, so here it is.
If you don't know where you're going, you might wind up someplace else.
That if you said in your, in your mind, oh, that sounds kind of like a Yogi Berra quote, you are absolutely right. The Yankees, great Yogi Berra said that if you don't know where you're going, you might wind up someplace else. One of his very famous Yogi isms there.
And but it's, hey, it's very true. If you don't know where you're going, you pretty, you're going to end up someplace else chances are anyway because you've got to have a proper plan in place. And it's like, you know, I often think about it like you get in the car and you're going somewhere for the very first time, you're going to want to use the gps, get those turn by turn directions. So you got to set in that destination first thing, right?
[00:06:39] Speaker C: Absolutely. And I know that, you know, in a recent episode we, we did, we talked about arriving to retirement with a suitcase, right. And so you got to know where you're going to know what you're going to pack. Right. So if, if you're going to Alaska on a cruise maybe and all you brought were flip flops. Well, that might be a problem because I'm pretty sure Alaska gets pretty cold. Or you, you got a cruise to the Bahamas and all you brought was snow gear and snowboards. So it's a little backwards. And I can't help but bring up cruises because we love to do them and we just did one over the holidays with the Kids as a Christmas present. So us and about 7, 000 other people. But nonetheless, you know, we knew where we were going and what we were getting into at that time.
[00:07:26] Speaker A: So just you and, you and Madison, the kids and 7,000 of your closest friends.
[00:07:31] Speaker C: Absolutely. You know, I love cruises.
[00:07:34] Speaker A: I love cruises too though. They're, they're fun. They're a lot of fun.
[00:07:37] Speaker C: Right, so let's get off that because I could talk about that. You know, when we get to, when we get a chance to meet for you listeners out there, I'll catch you up on how that Christmas cruise was for us in the family. There you go now. So again, the first step, you know, to, to building a result in advance for retirement, you know, getting to more serious conversation here would be, you know, delete the IRS and minimize your taxes in retirement.
So paying taxes is a reality of life.
But you don't have to leave the IRS a tip so you don't have to overpay. And you want to be as efficient as possible as we navigate the retirement journey in two ways that you can be tax efficient.
One of them, and you may have heard of it, we've spoken about it on the show, is a Roth conversion.
So a Roth IRA allows for tax free growth and tax free distributions in retirement.
So if I compare those to their siblings, you've either got a regular IRA in which when I pull money out, it's taxable to me as income, or its other sibling would be a non qualified like a brokerage account which is just cash.
And anytime I sell equities or I sell something in that brokerage account, I'm going to pay gain taxes. So brokerage accounts, traditional IRAs, 401ks, they have taxes as they come out. Whereas with the Roth, all the growth and distributions in retirement are tax free.
And lastly, when it comes to it being a qualified retirement vehicle, there are no required minimum distributions, meaning that when you get into your 70s, the IRS can't force you to withdraw funds each year, allowing your hard earned money to grow.
So that's one thing that we've seen is IRA conversions or you know, people contributing to Roth accounts later in life as they, as they get near retirement.
And another way that you can be a little bit more tax efficient. And these again, this is the only tax free investment, that's what this topic is would be life insurance.
You may say, well, well, Bradley, isn't life insurance meant for somebody else? It's not meant for me because if I die, how do I, I don't receive anything well, there are forms of life insurance that actually you can have invested and that money can grow over time and you're able to pull that money out in retirement for living. And those withdrawals can be tax free as long as you do it properly. So it's kind of like a dual purpose vehicle. Yes, you've got the life insurance death benefit for if you pass away, but also that built in cash value, you can withdraw that tax free to use for spending in retirement.
[00:10:42] Speaker A: It's a huge thing to be able to do that too. And I think that does open a lot of people's eyes in that, you know, you don't ever really think of, if you just think of like traditional use for life insurance money, it's actually more death insurance, quite frankly. But there are options out there to allow you to have that income that you can generate that's going to be tax free. And it's super important because, you know, right now we're actually, when you look at the numbers, people don't, people never like paying taxes. It's, this is not a fun thing to do. But tax rates are right now historically low in the U.S. i mean, much lower than say they were in like the early 60s. Right.
[00:11:24] Speaker C: And what people don't realize is, you know, the current 24% tax bracket. Right. So think 10, 12, 22, 24. So that's fourth in line aside from zero. So fourth, there's a zero bracket. The fourth in line there back in the early 60s was 56%.
So that's 8% higher than twice the current tax rate.
So what if taxes get up into the 50s again and you're sitting on this huge bucket of taxable IRAs and 401ks and things like that.
So you want to be aware of those, of those tax brackets. And, and that's why we are seeing a big, very big shift into those Roth IRAs. So we're converting. Let me go ahead and pay today's tax rates as opposed to tomorrow's tax rates, so that way I can be a little bit more in control of my retirement as opposed to allowing the government to dictate how much they're going to get every time I make a withdrawal from my retirement account.
[00:12:28] Speaker A: Yeah. And so if you, you know, are listening to the show, you're concerned about your taxes in retirement, give a call to Bradley and Madison Harden with Amerilife of Central Florida. They'll be glad to go through everything for you, get a Roth conversion plan done for you as well, if that's what's Right for you. It's all about what is right for you in your particular situation.
Because it's really the bread and butter of what they do is tailor make each and every retirement plan. So, you know, no two are the same because no two people are the same. No two families are the same. Just give them a call. 3863-2064-0638-6320-6406. You can also go to planretirementyourway.com and they can help build a smart tax plan for you and your family during retirement. And you know, I mean, really and truly, you know, you can help with that, that tax planning in the long term. You got to make sure though, folks that, you know, we are in the calendar has turned now into 2026. And so that means we are in tax season for this year. So that's something as well. Don't let that sneak up on you, right?
[00:13:34] Speaker C: No, no, I agree. And you know, tax day is April 15th. And so we want to make sure that we, we get a plan in place, do our strategies, get that stuff planned. So that way, you know, if you want to take a cruise or go on that Alaska trip or whatever you want to do, you're not worried about, oh, I need to make sure I'm in town during April because that's when the taxes are due.
And so kind of as we get back to that, that conversation before we go to step two, kind of finishing up, step one here would be there are only two tax free. So tax free investments available to Americans through a Roth IRA and life insurance.
Now we do know that municipal bonds, you know, those are not necessarily always tax free.
Sometimes they're subject to federal, state and local taxes and those can also potentially impact your Medicare cost through something called an irmaa.
Now if you know what an IRMAA is, you're very familiar or aware of what I'm talking about.
But money coming out of a ROTH or money coming out of a life policy is not to, going to, to count towards that.
[00:14:41] Speaker A: IRMAA calculation, income related Medicare adjustment amount.
[00:14:47] Speaker C: Absolutely. Matt, you hit it right on the head.
[00:14:49] Speaker A: One of this, one of those acronyms, you learn it, you don't forget it. Irma, she's not your friend that lives down the street. She's a friend you don't want to be having anything to do with.
[00:15:00] Speaker C: Right. And I think today at the, in the office we talked about Hurricane Irma. So no, this, this is not that type of hurricane. Right. This is a financial hurricane. Financial hurricane that we can try to avoid.
So again, to close out the, the Roth conversation, some reasons you should consider that would be tax free accumulation of wealth, tax free income in retirement, protection from future tax increases, no required minimum distributions, and you can leave a tax free benefit to your beneficiaries.
So as we progress forward here, let's go to step two.
Now step two is going to be about deleting unnecessary portfolio fees.
So again, first thing we talked about was tax efficiency. Next thing we're going to talk about are portfolio fees and the drag that that creates on your earnings year over year.
So we find that most people who call and we meet with don't understand the fees that they are actually paying inside of their portfolio in retirement accounts.
So what we want to do is a quick, you know, quickly eliminate any excess fees, especially on, on assets that are underperforming. Because if that asset is not performing and you're paying a fee, well that, that's a no brainer. We need to figure something different out for that portion of the portfolio.
So let me ask you, it's your money.
Don't you want to get the most out of it?
So we help our clients take advantage of fee efficient strategies while generating safe and predictable income that they can never outlive.
So again, when we look, because you, you may be, you may have an advisor, you may be with one of the big Wall street advisors or a local advisor or whoever. Right. And it's not that we as advisors have a problem with the fee that you may pay that advisor for their advice. So that's not really necessarily what we're talking about, but it would be more the, the funds that I own are there built in expense ratios and fees in those funds.
[00:17:07] Speaker A: Right.
[00:17:07] Speaker C: Because as the advisor, I, I think it's appropriate that they be compensated for the work that they do to help you plan that retirement.
But am I being double dipped? Right? So am I paying double the fees in the portfolio that that advisor has built for me or is it streamlined? And so through our, you know, you know, deletion of portfolio fees, we can try to optimize and lower those overall cost to their, you know, to be able to generate more result throughout the year.
So another part of that portfolio fee deletion is, you know, we talked about the sequence of returns where I'm pulling money out, paying fees and the market goes down. Well, some of the reason why people are having to pull that money out is because we've seen a rapid decline in pensions being available for retirees.
So less than 16, that's 1, 6, 16% of the private sector workforce retired with a pension.
So what we're able to do out of that portfolio is create a personal pension. So we're going to get to that topic here in just a moment. I believe that's step three. I don't want to jump ahead, but again, so deleting unnecessary fees out of your portfolio is step two in planning for retirement your way.
[00:18:32] Speaker A: Yeah, and that's, you know, part of that can be that personal pension. And we'll get to those details about that in just a second. But you know folks, if you're interested in learning about something like that, maybe a bond replacement, replacing the bonds in your portfolio, that could be coming with a lot of fees and how significantly to how significantly that can improve your, your overall retirement income picture. Just give a call to Bradley and Madison hardin planretirement your way.com is the website or you can give them a call that number once again, 386-3206-406386, 3206406. And they'll be standing by to help you and help you get that plan in place so that you can have retirement your way.
All right, so continuing on now to that step that much talked about, step three, generating more income from your savings. This is really where the bread is buttered, so to speak, because in retirement it really is all about income or at least more about income than the size of that nest egg you've built up.
[00:19:41] Speaker C: And all these, this old version portfolio building where the 60, 40 portfolio, 60 equities, 40 bonds, that's going to provide our income. Well, you know that that's in our opinion, a lot of advisors like ourselves that that advice is a little outdated if I'm, if I'm being honest with you here, guys. Well, and it's because there are a lot of alternatives to that bond portfolio of your or that bond portion of your portfolio. Because if you've ever looked at your graph on your financial statement, bonds fall under fixed income. And fixed income is supposed to be the safety security fixed. Right. That's what you would expect it to be. But as we know, depending on the way the market's going, bonds can decrease in value.
Bonds can be called coupon rates can go down as, as we go to shop those bonds. And so a lot of advisors now are looking at a fixed index annuity as a replacement bond strategy in the portfolio.
So whether you're looking at it as a straight replacement of the bond section where I can now you know, never lose or go down from what I put into that fixed index annuity. Another way to utilize that solution is by creating guaranteed income and by creating what we like to call your, your own personal pension.
So when we do that, we roll over a portion of those assets into the fixed index annuity. And whenever you're ready, whether it's today, a year from now, three or four years from now, we can utilize that strategy to provide that supplemental income to your Social Security.
So these fixed index annuities are seen as a safe accumulation alternative to bank CDs or traditional bonds.
And so you know, fixed index annuities or a fia. So I'm going to abbreviate it with fia. FIA provide a solution for investors looking to protect their hard earned retirement savings from market volatility.
FIAs are designed to provide protection from market downturns while maintaining accumulation benefits for growth.
So again, if this, this may be a new concept to you, you may never have heard of that before, but its main job is to protect you from market volatility. So ask yourself, how much of my hard earned retirement savings am I willing to risk in the market?
So when we meet, part of our initial discussion is figuring out what your risk score is.
So anywhere from 0 to 80. No, not to 100, but 0 to 80, 80 being the most aggressive. Dale earn hard, wide open, pedal to the middle. You know it's easy to say that because I'm, I'm, I live not far from the speedway here in Daytona and the other people back, back down to a zero. Right. So that's conservative doomsday. I don't, I'm gonna just hold on my money in cash. Well, there's a problem being too far one way or the other on that, on that scale. So our job in the first appointment is to identify where do you fall? Are you a 20, 30? Are you a 60? Are you a 55? What's your number?
Because once we have a number, we can then determine the right portfolio design for your retirement.
So again, kind of getting back to that safety into main benefits of the fixed index annuity, protection from market volatility.
Next is tax deferred growth.
So while that annuity is earning interest year over year, I'm not going to get a 1099 from the bank like, like you would from the bank. You're not going to get a 1099 from the, the annuity company for that growth. Only if I withdraw money. Right, so you're not avoiding taxes. But again, any growth you're not paying as it's growing.
Next is you can guarantee a lifetime income stream. So I know bonds can guarantee a lifetime income at a certain rate. Those bond prices and coupons are always fluctuating and you can never outlive that income.
And lastly, whatever's left in your account when we establish that annuity, we will be listing your beneficiaries.
So if you, you know, God forbid, pass away without ever taking any income, all of the money that you put in there will go to a beneficiary that you choose. So, so again, it's going to provide a death benefit for beneficiaries when you pass away.
So in most financial conversations, you know, fixed index annuities are really only suitable for at most 70 of your portfolio.
And typically, you know, so typically the top end is 70, but our clients are really only using about 25 to 50% of those retirement savings, while the rest is allocated to a smart risk investment that may provide further opportunity for additional growth and kind of closing out that. That's the idea of why we come up with your number is, well, you scored a 55, so that means you should have about X amount remaining in the market. X amount and something safe that you can never outlive and things like that. Matt. So again, this is very common in what we do, right?
[00:25:13] Speaker A: And it's all about balance. You know, for you, what's best for you, again, in your individual situation.
And you don't have to guess about your retirement future. They're going to map it out for you. At Amerilife of Central Florida, Bradley and his wife Madison will be glad to show you what your options are for that sort of results in advance retirement that we've been talking about here, that blueprint for that. They'll run the tax analysis, identify hidden fees in your current portfolio, show you what that expense ratio looks like now and what it would look like if you were to work with them, and then also show you what guaranteed income could look like as part of your plan as well. The website is Plan retirement your way.com Plan retirement your way.com. you could also call them at 386-3206-406-386-3206406.
Well, last couple of minutes here of the show, Bradley, and we teed this up at the top. So I wanted to cover it just really quickly here. There is a big 401k curveball coming the way of people who are higher earners this year. The Wall Street Journal reports that workers who are 50 and older and earn more than about $150,000 a year will no longer be allowed to make pre tax catch up contributions to their 401k.
Those dollars must go into a Roth 401k. They can't go into that traditional account. They have to go to the Roth 401K. And the big difference is that, you know, traditional catch ups lower your taxable income today. But Roth catch ups don't. You have to pay that tax now and the withdrawals later are tax free. So it's a little bit of. Okay, a balancing act. All of it's a balancing act with, you know, just getting what, what is right for the person.
But that is something to just keep in mind, folks, as you are sort of navigating the tax landscape now and in the future. Right, Bradley?
[00:27:06] Speaker C: Right. No, I agree. And that's a great point, Matt, to make. And, and because people, you know, Once they're over 50, sometimes they feel like they're behind and they want to make those catch up contributions. So just be aware that over 150,000 you can no longer make those catch up contributions. So be sure to get those contributions in during the working year so that way you're not caught paying an additional tax on money that you had intended on saving. So that's a great way to wrap up the show and get point there. Matt, thank you.
[00:27:35] Speaker A: Yeah, no worries. Thank you. And that's going to do it for our time here together this week. It always flies by this week. No exception to that rule for sure. But Bradley, thank you so much for all that you bring to the table every time we get together and we'll talk to you again next time.
[00:27:50] Speaker C: Thanks again, Matt. Appreciate it. And for you listeners out there, 386-320-6406, give me a call. Happy to chat. Take care.
[00:27:59] Speaker B: Thanks for joining us for Retirement your Way with Amerilife of Central Florida. Our goal is to bring clarity and confidence to your retirement journey. Remember, Bradley and Madison Hardin are here to help you create a personalized plan for the future you deserve. If you'd like to schedule a no cost, no obligation consultation, give the team a call at 386-320-6406 or visit planretirementyourway.com and don't forget to tune in next week, same time, same place for more strategies, insights and support to help you live retirement your way. Investment advisory services offered through Brookstone Capital Management, LLC, a Revolution registered investment advisor. BCM and AmeriLife are separate companies but are affiliated through Common ownership Insurance products and services are not offered through BCM, but are offered and sold through individually licensed and appointed agents not affiliated with the United States Government. Bradley and Madison Hardin do not offer tax or legal advice. Consult with your tax advisor or attorney regarding specific situations. Opinions expressed are subject to change without notice. These opinions are not intended to predict future performance of any product. All information provided is believed to be from reliable sources. However, we make no representation or warranty as to the accuracy of any statement. This information is intended to be educational in nature and does not provide a guarantee or specific result. All copyrights and trademarks are the property of their respective owners. Amerilife assumes no responsibility or liability for the content of this message. The information contained herein is provided on an as is basis with no guarantees of completeness, accuracy, usefulness, timeliness, or the results obtained from the use of this information.
[00:29:32] Speaker A: Any comments regarding safe and secure investments and guaranteed income streams refer only to fixed insurance products. They do not in any way refer to investment advisory products. Rates and guarantees provided by insurance products and annuities are subject to the financial strength of the issuing insurance company, not guaranteed by any bank or the fdic.
