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Retiring Comfortably · Money In Motion with Klaas Financial

0:00
Speaker 1: And their number six oh eight four four two five
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Speaker 1: six three seven as mentioned, joined this week by CJ.
0:05
Speaker 1: Closs and Nate bribeing CJ. How you doing this morning?
0:08
Speaker 2: I'm doing great.
0:09
Speaker 1: How are you, Sean, I'm doing really well. It's great
0:11
Speaker 1: to chat with you. Nate, how have you been.
0:14
Speaker 3: I'm happy to be back.
0:16
Speaker 1: It is great to have both of you along. Great
0:18
Speaker 1: to hear from you again Nate as well. We're gonna
0:20
Speaker 1: be talking about having a plan, having a roadmap when
0:23
Speaker 1: it comes to retirement and how important that is. We'll
0:26
Speaker 1: get the details from cjn Nate. We will get those
0:29
Speaker 1: very very shortly. As mentioned, phone lines are open for
0:31
Speaker 1: your questions at six oh eight three two one thirteen ten.
0:34
Speaker 1: That's six oh eight three two one thirteen ten. I
0:37
Speaker 1: also hope you get a chance during today's program. Head
0:39
Speaker 1: on over to the website Colassfinancial dot com. That's coss
0:42
Speaker 1: k l a a S Financial dot com. You can
0:44
Speaker 1: learn more about class financial on that website. You can
0:46
Speaker 1: also sign up for the weekly market Paul's newsletter and
0:49
Speaker 1: listen back to this in previous shows. Podcasts. That stuff
0:52
Speaker 1: all available to you at Colossfinancial dot com. That's closs
0:55
Speaker 1: K l A A S Financial dot Com their telephone
0:58
Speaker 1: number six oh eight four four two five six three seven. So,
1:02
Speaker 1: before you get rolling on this week's conversation, one of
1:04
Speaker 1: the cool features also the program is the Class Quiz
1:07
Speaker 1: question week This week no exception chance to win a
1:09
Speaker 1: great prize, a twenty five dollar gift card from our
1:11
Speaker 1: friends at Class Financial to Best Buy. I'll tell you
1:14
Speaker 1: a little bit later on the show how you can
1:16
Speaker 1: win that. And before we get rolling on this week's topic,
1:19
Speaker 1: let's actually take a look back at last week's show
1:21
Speaker 1: and get the question an answer there as well.
1:24
Speaker 2: Yeah, thanks Sean. So last week's question was a truer
1:28
Speaker 2: false question, and the question was over the last thirty years,
1:32
Speaker 2: average tuition and fees at public four year colleges have
1:36
Speaker 2: jumped one hundred and twenty five percent after adjusting for inflation.
1:41
Speaker 4: So is that a true or false statement? The answer
1:44
Speaker 4: was true, and congratulations to our winner from last week,
1:47
Speaker 4: which was Mike of Verona. Congratulations Mike, and everybody make
1:52
Speaker 4: sure you listen closely this week.
1:53
Speaker 1: Could you to be a will You sure could? Great
1:56
Speaker 1: great work there, Mike, You two can be like Mike.
1:58
Speaker 1: As CJ mentioned, listen closer to the program. Typically the
2:00
Speaker 1: question answer come up during each week's show. I'll tell
2:03
Speaker 1: you a bit later on the show how you can
2:04
Speaker 1: win that twenty five dollar gift guard. So on this show,
2:08
Speaker 1: of course, we've talked many times about the importance of
2:10
Speaker 1: having a plan or a roadmap for retirement, of course,
2:13
Speaker 1: and how key that is now as we're getting a
2:15
Speaker 1: little older. Where should we be on that map?
2:19
Speaker 3: Nate, Yeah, this is a great question to ask if
2:22
Speaker 3: you're in your accumulation phase of your retirement journey. Is
2:25
Speaker 3: you know where am I at? Am I ahead? Or
2:27
Speaker 3: am I behind? So let's talk through some key stops
2:30
Speaker 3: on your retirement roadmap to help you make informed decisions
2:35
Speaker 3: yours now. While you can't rewind the clock, we can
2:38
Speaker 3: take smart steps now, like ramping up savings, reducing spending,
2:42
Speaker 3: and knocking down debt to make the road ahead smoother.
2:45
Speaker 3: So stop one a I would say would be ask yourself,
2:48
Speaker 3: when do you want to retire or how much do
2:50
Speaker 3: you want to spend? You know that helps back into
2:52
Speaker 3: some savings amounts. You know that's a common question is
2:55
Speaker 3: how much should I sid be saving? We say, well,
2:57
Speaker 3: when do you want to retire or how much do
2:58
Speaker 3: you want to spend, then we can kind of kind
3:00
Speaker 3: of back into how much you should be saving. So
3:04
Speaker 3: one B would be obviously to save more. That's you know,
3:06
Speaker 3: something financial planners love to say is, you know, we've
3:09
Speaker 3: never heard anyone say they save too much, right, So
3:11
Speaker 3: look to maximize contributions, right. And once you turn fifty
3:16
Speaker 3: you do become eligible for what is known as ketchup contribution.
3:20
Speaker 3: So if we look at four oh one K or
3:22
Speaker 3: four h three B plans, first, the normal employee salary
3:26
Speaker 3: deferral is twenty three thousand, five hundred for the year,
3:30
Speaker 3: and if you're over fifty, that's an additional seventy five hundred.
3:33
Speaker 3: You can save up to thirty one thousand dollars per
3:37
Speaker 3: year that you could be saving for your future, which
3:39
Speaker 3: would be great. Now there is an additional this is
3:43
Speaker 3: a wonky provision honestly, in the tax code now from
3:46
Speaker 3: sixty to sixty three there's an additional catchup contribution even
3:52
Speaker 3: higher than the seventy five hundred, two hundred and fifty
3:56
Speaker 3: for twenty twenty five, So you don't get to add
3:58
Speaker 3: that to the seventy five hundred. It's in replace of
4:01
Speaker 3: the seventy five hundred, so it's a total of thirty
4:04
Speaker 3: seven thousand, seven hundred and fifty allowing you to defer
4:08
Speaker 3: into a company sponsored retirement plan, which is great. Now
4:12
Speaker 3: for those that may not have coverage through an employer plan,
4:16
Speaker 3: most should you should be eligible for a traditional or
4:19
Speaker 3: a roth IRA. What's the normal contribution limit is seven
4:23
Speaker 3: thousand dollars or it's the lesser of seven thousand dollars
4:28
Speaker 3: of your or your earned income for the year, and
4:31
Speaker 3: if you're over fifty, you can add an additional one
4:33
Speaker 3: thousand dollars for a total of eight thousand dollars, which
4:35
Speaker 3: are great. So now stop number two would be looking
4:40
Speaker 3: at health savings accounts, So these are great accounts. Okay,
4:43
Speaker 3: So these you do have to be enrolled in what's
4:46
Speaker 3: called an HSA eligible plan, so certainly ask your employer
4:50
Speaker 3: if they have a plan available, and open enrollment should
4:53
Speaker 3: be coming up here towards to make sure to see
4:56
Speaker 3: if you're eligible potentially next year as well. Now hsas
4:59
Speaker 3: are great their triple tax exempt savings vehicles, so contributions
5:03
Speaker 3: are tax deductible, earnings grow tax free, and qualified with
5:07
Speaker 3: drills are also tax free. So this is the only
5:09
Speaker 3: count that is actually triple tax free, so something very
5:13
Speaker 3: important to take advantage. Still going to have health expenses
5:16
Speaker 3: at some point in the future, and you know, these
5:19
Speaker 3: have a ton of flexibility in the sense that unlike
5:21
Speaker 3: a flexible spending account that has to be distributed fully
5:25
Speaker 3: every year, these balances can be ruled to future years.
5:29
Speaker 3: So even if you don't have a health event or expense,
5:33
Speaker 3: you know this year or next year, you can save
5:34
Speaker 3: it for retirement and continue to accumulate those funds. So
5:39
Speaker 3: just quickly hear the maximum contribution limits are foury three
5:44
Speaker 3: hundred for individual coverage and eighty five hundred and fifty
5:47
Speaker 3: dollars for family coverage plus at age fifty five, there's
5:51
Speaker 3: an additional one thousand dollars catchup contribution as well, making
5:54
Speaker 3: them great saving vehicles in addition to your traditional retirement.
5:58
Speaker 1: Accounts, really good, really good tools and really good opportunities there.
6:02
Speaker 1: As we talked this morning with our retirement planning professionals
6:04
Speaker 1: from Class Financial, CJ. Coloss and Nate Briby, you've got
6:07
Speaker 1: a question, love to have Jonas this morning, tell Fortomber
6:09
Speaker 1: to get on the air. Six eight three two one
6:11
Speaker 1: thirteen ten. That's six o eight three two one thirteen ten.
6:14
Speaker 1: You can learn more about COSS Financial on their website
6:16
Speaker 1: coss financial dot com. That's Coss k l aa s
6:20
Speaker 1: financial dot com. They're tough for number six so eight
6:22
Speaker 1: four four two five six three seven. No charge for
6:25
Speaker 1: that initial gets to know you appointment at Coss Financial.
6:27
Speaker 1: It will be complimentary too. Again their number six O
6:29
Speaker 1: eight four four two five six three seven looks you
6:32
Speaker 1: our conversation with CJNA. We will do that next as
6:35
Speaker 1: Money in Motion with Class Financial continues here on thirteen ten.
6:38
Speaker 1: Wiv A hanging out with our retirement planning professionals from
6:41
Speaker 1: Class Financial, Cjcloss and Nate Briby. Hope you get a
6:44
Speaker 1: chance today to head on over the website coss financial
6:46
Speaker 1: dot com. That's Coss k l aa s financial dot com.
6:50
Speaker 1: Great website resource to learn more about COSS Financial, learn
6:53
Speaker 1: about the team. You can learn about their separate divisions.
6:55
Speaker 1: You can also sign up for the weekly Market Pulse
6:57
Speaker 1: newsletter that available to you at cossfinancial dot com. They're
7:00
Speaker 1: telp for number six so eight four four two five
7:02
Speaker 1: six three seven. No charge for that initial get to
7:04
Speaker 1: know the appointment deck Claws Financially. It will be complementary
7:07
Speaker 1: to you talking this morning about putting together a plan,
7:10
Speaker 1: a roadmap, if you will, for for retirement and kind
7:14
Speaker 1: of knowing where we should be on that map. And
7:17
Speaker 1: you know, I've got a couple of questions for you, CJ.
7:20
Speaker 1: You still need like an emergency fund, for example, as
7:22
Speaker 1: you approach retirement, and what about the challenges of you know,
7:25
Speaker 1: debt and and how we're kind of dealing with the
7:27
Speaker 1: debt at this point. There's got to be some pretty
7:31
Speaker 1: important questions to have answered, aren't they.
7:34
Speaker 4: Yeah, so pre retired and retired people still need to
7:37
Speaker 4: make sure they have an emergency reserve savings account that
7:40
Speaker 4: is that is well funded. Unfortunately, life always seems to
7:44
Speaker 4: get in the way when when we least expect it. So,
7:48
Speaker 4: you know, stop number number three here on our on
7:50
Speaker 4: our trip is building and maintaining an emergency fund. So
7:55
Speaker 4: ideally keep at least six months of living expenses in
7:58
Speaker 4: an accessible savings or money market account. And by doing this,
8:03
Speaker 4: the buffer helps to protect your retirement accounts from unexpected
8:06
Speaker 4: expenses that keep your long term plan intact. Now, this
8:11
Speaker 4: emergency fund is actually more powerful than people realize. The
8:15
Speaker 4: emergency fund can keep you from using a credit card.
8:18
Speaker 4: It can keep from you from having to use a
8:20
Speaker 4: line of credit on your home. It can keep you
8:23
Speaker 4: from really accepting jobs that you shouldn't be. So think
8:28
Speaker 4: I lose a job, I have no emergency reserve. Well,
8:30
Speaker 4: my goodness, the first job that pops up available to
8:33
Speaker 4: me is just I'm going to take it right because
8:35
Speaker 4: I have no breathing room in my budget, so cannot
8:40
Speaker 4: emphasize enough emergency reserves. Think that is again, the six
8:44
Speaker 4: months of living expenses in an easily accessible savings or
8:48
Speaker 4: money market account is pretty critical, and that's why we
8:51
Speaker 4: highlight it as stop number three on our trip here.
8:54
Speaker 4: Now that does bring us to stop number four, which
8:57
Speaker 4: is tackling your debt head on. So you can start
9:00
Speaker 4: by accessing your full financial picture. This is your income,
9:04
Speaker 4: your expenses, and any outstanding debts. Calculate how much after
9:07
Speaker 4: tax income you'll need to maintain your lifestyle and retirement,
9:11
Speaker 4: and then identify areas of unnecessary spending and redirect those
9:15
Speaker 4: dollars towards savings or debt payoff. Eliminating debt, especially high
9:20
Speaker 4: interest debt, can drastically improve your retirement readiness. So Nate
9:25
Speaker 4: and I will often talk with people about this, like, Hey,
9:28
Speaker 4: it depends on where you're at in the phase of
9:32
Speaker 4: retirement preparation. So if you're in Nate's age or my age,
9:37
Speaker 4: or fifty eight years old, ready to retire at fifty nine,
9:41
Speaker 4: the level of aggression you have to eliminate a particular
9:44
Speaker 4: debt can actually vary. We would generally say to you,
9:48
Speaker 4: which if you've listened to our show, everybody's going to
9:50
Speaker 4: know what I'm about to say. We would generally say,
9:53
Speaker 4: retiring with no debt is bar none the best way
9:56
Speaker 4: to retire. However, if you're if you're you're not going
10:00
Speaker 4: to be able to do that, it can be risky
10:02
Speaker 4: to hear what we're saying, go at fifty eight years old,
10:06
Speaker 4: pull all your money, iud to hear four O one
10:07
Speaker 4: K and pay off your mortgage. That's not what we're saying.
10:10
Speaker 4: So you do need to work with an advisor to
10:12
Speaker 4: figure out the balancing act of that. But tackling your
10:16
Speaker 4: debt head on is critical. Think of it this way.
10:19
Speaker 4: If I could take ten thousand dollars of say emergency
10:23
Speaker 4: reserve funds, and save five hundred dollars a month on
10:29
Speaker 4: an auto payment as I head into retirement, or I
10:32
Speaker 4: could put that ten thousand dollars into my four toh
10:34
Speaker 4: one K plan that already has eight hundred thousand dollars
10:37
Speaker 4: in it. I am much better off paying off my
10:42
Speaker 4: auto loan to free up five hundred dollars a month
10:45
Speaker 4: than I am to put that same ten thousand dollars
10:47
Speaker 4: into a four to one K plan. So each situation
10:50
Speaker 4: is unique. Sit down with your advisory. But here's some
10:53
Speaker 4: fun facts. As of late twenty twenty four, the average
10:56
Speaker 4: US household with debt carries over one hundred and five
11:00
Speaker 4: thousand dollars in total debt obligations, with mortgages representing seventy
11:04
Speaker 4: percent of total debt. For baby boomers ages fifty six
11:08
Speaker 4: to seventy four, that average stands approximately at ninety seven
11:12
Speaker 4: thousand dollars. And this is according to a CNBC poll.
11:16
Speaker 4: Boomers usually have the largest portion of their debt as mortgages.
11:21
Speaker 4: Personal loans come in second, and then credit card debt
11:24
Speaker 4: comes in third. So it's important to note that these
11:26
Speaker 4: are averages, and of course individual debt levels can vary
11:30
Speaker 4: greatly depending upon different factors. But just some kind of interesting,
11:34
Speaker 4: interesting stats for.
11:34
Speaker 1: You to be aware talking this Morning with CJ. Closs
11:37
Speaker 1: and Nate Bribey are retirement planning professionals from COSS Financial
11:39
Speaker 1: the website Coss financial dot com. That's Coss k l
11:42
Speaker 1: a as Financial dot com. Dell for number six soh
11:45
Speaker 1: eight four four two five six three seven, no charge
11:48
Speaker 1: for that initial get to know your appoyment debt loss financial,
11:50
Speaker 1: It will be complimentary to you again their number six
11:53
Speaker 1: oh eight four four two five six three seven. And
11:56
Speaker 1: I know, CG. I know that there's more to tackling
11:59
Speaker 1: debt as well, and some really really interesting perspectives and
12:02
Speaker 1: things to think about when it comes to taking care
12:04
Speaker 1: of debt, isn't there.
12:06
Speaker 4: Yeah, So lingering debt in your fifties can delay retirement,
12:09
Speaker 4: So just take control of that now and try to
12:11
Speaker 4: build a plan to eliminate your debt before you retire.
12:14
Speaker 4: We would say pay off high interest credit cards as
12:16
Speaker 4: soon as possible, obviously largely because those are going to
12:22
Speaker 4: compound against you the fastest, and then again consider working
12:26
Speaker 4: towards paying off your mortgage. Now. A lot of people say,
12:28
Speaker 4: but CJ, do you know that I can get four
12:31
Speaker 4: percent on my money market and my mortgage is at
12:34
Speaker 4: two and a half, Like why would I ever do that.
12:37
Speaker 4: So I just want to remind everybody there are financial
12:39
Speaker 4: planning firms that I'll call it quantitatively centric, so think
12:43
Speaker 4: of it as math centered. And then there are firms
12:46
Speaker 4: that are behavioral centered, and truth be told, our firm
12:50
Speaker 4: tries to be balanced in these approaches. However, far and
12:55
Speaker 4: away we are a behavior centric firm. And here's why.
12:58
Speaker 4: Because we don't see math being the center of the
13:01
Speaker 4: problem for people. Okay, we don't see math, We see behaviors.
13:06
Speaker 4: So said another way, I don't think people like don't
13:09
Speaker 4: know the math of credit cards. It's not like they
13:11
Speaker 4: don't understand that they're paying twenty to twenty five percent
13:14
Speaker 4: on credit cards. It's their behaviors that are out of control. Right,
13:18
Speaker 4: So what we would say is we're not saying math
13:20
Speaker 4: doesn't matter, but we're saying behaviors matter more, and therefore
13:25
Speaker 4: those behaviors need to be modified in a robotic pattern
13:29
Speaker 4: to help you accomplish your goals. This is why we
13:31
Speaker 4: tell people pay yourself first, save into your four to
13:33
Speaker 4: one K plan, because if you rely on just simple math,
13:38
Speaker 4: your behaviors tend to override all of them. Okay, rant
13:41
Speaker 4: over all, we're trying to say is try to get
13:43
Speaker 4: your mortgage paid off. We understand the arbitrage opportunity, but
13:46
Speaker 4: we would suggest don't take advantage of that arbitrage opportunity,
13:50
Speaker 4: at least in the long run, try to get your
13:52
Speaker 4: debts paid off.
13:53
Speaker 1: Well stated this morning, CJ. Clause in Nate Briby, our
13:56
Speaker 1: retirement planning professionals from Class Financial some great understanding as
13:59
Speaker 1: well well about the thinking when it comes to working
14:01
Speaker 1: with the folks at C Loss Financial. If you want
14:03
Speaker 1: to set up appointment to make it easy to do,
14:04
Speaker 1: I can expect foe pick up the phone and give
14:07
Speaker 1: them a call six so eight four four two five
14:09
Speaker 1: six three seven that first gets to know you. Appoyment
14:11
Speaker 1: at Lost Financil no charge, It'll be complimentary to you again,
14:13
Speaker 1: they're number six oh eight four four two five six
14:16
Speaker 1: three seven. So, Nate, where canna you start start? When
14:19
Speaker 1: it comes to planning for how much I think I'll
14:21
Speaker 1: need as far as income in retirement? It seems like
14:24
Speaker 1: a big question.
14:25
Speaker 3: There it is, and honestly it's one of my favorite
14:27
Speaker 3: ones because this is truly probably the most important variable
14:31
Speaker 3: in the retirement income equation is how much do you
14:33
Speaker 3: plan to spend in retirement and you ask the client
14:35
Speaker 3: that they're going to look at you with the blank
14:37
Speaker 3: stare like do what now?
14:38
Speaker 4: You know?
14:39
Speaker 3: So determined, but this really does need to be answered
14:44
Speaker 3: before we can tell you how much you need to
14:46
Speaker 3: have you know, if you saved enough to retire. This
14:49
Speaker 3: is because how much you need to have saved depends
14:51
Speaker 3: entirely on how much you plan to spend. Okay, now
14:55
Speaker 3: you know, so this is stop five determining your retirement
14:58
Speaker 3: spending needs. And some people I assume that you retirement,
15:02
Speaker 3: but that's truly not always the case. And in fact,
15:05
Speaker 3: if you think about it, you actually have more time
15:07
Speaker 3: and opportunity to spend money in retirement, right because you're
15:09
Speaker 3: obviously not working. So you know, you know, you work
15:12
Speaker 3: all day, you go home, you cook dinner, and you
15:14
Speaker 3: read a book or watch TV. Right, Like, but you
15:16
Speaker 3: know today, if you weren't working, you could go, you know,
15:18
Speaker 3: out to lunch with your friends and go golf in
15:20
Speaker 3: the afternoon. Right, you have more opportunities to spend money, Okay,
15:23
Speaker 3: more time available. So but here's what we tell people.
15:26
Speaker 3: A good starting point would be, look at your current net,
15:28
Speaker 3: take them pay for the month and see if it's
15:30
Speaker 3: possible to replace that. Right, So, say I met twenty
15:33
Speaker 3: five hundred dollars each pay period, I get paid twice
15:36
Speaker 3: a month. That's five thousand dollars. Right, Let's see if
15:38
Speaker 3: we can get to five thousand dollars a month sources
15:42
Speaker 3: at least get us on par to what we were
15:45
Speaker 3: used to experiencing. Now, on top of that, you could
15:48
Speaker 3: add a separate like annual budget for travel or you know,
15:52
Speaker 3: some other big expenses that you would like to have
15:55
Speaker 3: in the future. And truly, I tell people, don't don't worry,
15:58
Speaker 3: I mean worry about tax but let up determine that, truly,
16:02
Speaker 3: because I've seen people coming like I'm just gonna add
16:04
Speaker 3: thirty percent on for taxes, Like, where do you even
16:07
Speaker 3: get that number?
16:07
Speaker 4: Right?
16:08
Speaker 3: It's it's not probably not going to be that high.
16:10
Speaker 3: So anyway, start with the net amount that you want
16:12
Speaker 3: and let someone like us add back on the taxes.
16:14
Speaker 3: So the first once you have that, what you're trying
16:17
Speaker 3: to hit, say five thousand a month, okay, first add
16:21
Speaker 3: up your fix your expected fixed income sources. So we
16:24
Speaker 3: look at social securities, any pensions, any part time work,
16:27
Speaker 3: and things like that. Right, where is that? What does
16:29
Speaker 3: that get us to now? Second, and more difficult would
16:32
Speaker 3: be determine how much you can withdraw from your investments,
16:35
Speaker 3: which you know to be accurate on this honestly is
16:38
Speaker 3: not as easy as it sounds. And CJN and I
16:40
Speaker 3: could with all the research we've read about this, but
16:43
Speaker 3: to simplify it, say it's anywhere from four to six
16:45
Speaker 3: and a half percent of your investments. And of course
16:48
Speaker 3: your exact number could be determined with the help of
16:50
Speaker 3: a financial planner. But but say we take we do
16:53
Speaker 3: that math, take five percent of whatever you have saved
16:56
Speaker 3: for starters, add that to your fixed income sources, and
16:59
Speaker 3: maybe that gets you. It's your current take home pay
17:03
Speaker 3: and you should be on the right track to retire
17:05
Speaker 3: with that, right. That's just kind of a rough rule
17:06
Speaker 3: of thumb. At least get us in the ballpark there.
17:10
Speaker 3: And finally, you know, just a kind of a pet
17:12
Speaker 3: peeve of all of us, is, you know, make sure
17:14
Speaker 3: you're you're tracking your cash balances. You know a lot
17:17
Speaker 3: of money markets and checking and savings accounts are paying
17:20
Speaker 3: point one percent right ten bases points. So the Fed
17:24
Speaker 3: just cut rates yesterday, I believe a quarter point but
17:26
Speaker 3: you should be getting around four percent maybe three point
17:29
Speaker 3: seventy five now on on high yield money markets accounts.
17:31
Speaker 3: So don't make sure you're maximizing your cash and other
17:35
Speaker 3: higher yielding money market vehicles if you have those available.
17:39
Speaker 1: So and and Nate, there's some real numbers to that
17:41
Speaker 1: as well. A little fun fact, isn't.
17:43
Speaker 4: There it is.
17:44
Speaker 3: It's a big number. Yeah, Sean, it's been estimated that
17:48
Speaker 3: almost two hundred and ninety one billion dollars in interest
17:51
Speaker 3: has been lost by sticking in in low yielding money
17:53
Speaker 3: markets account over let's see here a three or four
17:56
Speaker 3: year period.
17:56
Speaker 1: So wow, that's yeah, that's it's pretty staggering when you
18:00
Speaker 1: when you kind of break it down that way. As
18:02
Speaker 1: we talked this morning with Nate Briby and CJ. Closs,
18:04
Speaker 1: they are our retirement planning professionals from COSS Financial the
18:07
Speaker 1: website cost financial dot com. That's Coss k l A
18:11
Speaker 1: A S Financial dot com. They're telephon number six so
18:13
Speaker 1: eight four four two five six three seven. No charge
18:16
Speaker 1: for that initial gets know you appoyment at Loss Financial.
18:18
Speaker 1: It will be complementary to you again their number six
18:21
Speaker 1: O eight four four two five six three seven. We'll
18:24
Speaker 1: do the Closs Quiz question the week, we'll head on
18:26
Speaker 1: over to the Money in Motion Listener question corner. We'll
18:28
Speaker 1: also wrap up this week's roadmap that and so much
18:31
Speaker 1: more next as Money in Motion with Coss Financial continues
18:34
Speaker 1: here on thirteen ten. Wu ib A talking with our
18:37
Speaker 1: retirement planning professionals from COSS Financial this morning, c J.
18:40
Speaker 1: Closs and Nate Briby. The website Coss Financial dot com.
18:44
Speaker 1: That's Coss k l a A S Financial dot com.
18:47
Speaker 1: They're telephone number six so eight four four two five
18:50
Speaker 1: six three seven. No charge for that initial gets know
18:52
Speaker 1: you appointment at Costs Financial. It will be complementary to
18:55
Speaker 1: you laying out a roadmap this week, several stops along
18:59
Speaker 1: the way when it comes to you getting ready for
19:01
Speaker 1: retirement and understanding retirement. And before we get to the
19:05
Speaker 1: Money in Motion listener question corner, CJ. I know a
19:08
Speaker 1: lot of us, You know, I look towards fifty or
19:11
Speaker 1: as you hit fifty, we start to think, you know what, I,
19:13
Speaker 1: I probably should have saved more earlier. Is there any
19:16
Speaker 1: advice or any any thoughts as far as a guidance
19:19
Speaker 1: for folks that that feel that way?
19:22
Speaker 4: Yeah, good point, Sean. It is common you get to
19:25
Speaker 4: around the magical age of forty or fifty, and somewhere
19:28
Speaker 4: in that range you have this kind of like hack rap.
19:32
Speaker 4: It's this guilty feeling of I should have done more,
19:34
Speaker 4: and that's truth to be told that that is even
19:36
Speaker 4: common for people who have done quite a bit, because
19:40
Speaker 4: you never feel quite adequate. We have this phrase in
19:43
Speaker 4: our business which is people never compare down, they always
19:46
Speaker 4: compare up. What do I mean by that? If you
19:49
Speaker 4: have two hundred thousand dollars saved when you're fifty years old,
19:53
Speaker 4: you're going to compare to people that have more than that.
19:56
Speaker 4: If you have two hundred million dollars when you're fifty
19:59
Speaker 4: years old, you're going to com to people that have
20:00
Speaker 4: more than that. To see my point, we don't compare down,
20:04
Speaker 4: we compare up. So it's normal. It's normal for you
20:06
Speaker 4: only to feel like you're behind. But we would say
20:10
Speaker 4: getting started as the key that the kind of sinking
20:14
Speaker 4: your head in the sand and not being aware of
20:16
Speaker 4: where you're at is not a great strategy. So obviously
20:19
Speaker 4: this is where working with a fee based financial planner,
20:21
Speaker 4: a fee based fiduciary can really help. Because Nate and
20:24
Speaker 4: I don't meet with one or two or three people.
20:28
Speaker 4: We actually have as a firm eleven hundred households. I
20:31
Speaker 4: believe Nate oversees something like two hundred and twenty households.
20:35
Speaker 4: I oversee about one hundred and seventy households. And so
20:38
Speaker 4: you get the idea like, this is not we're not
20:40
Speaker 4: retiring once. We're not working with people in their thirties
20:44
Speaker 4: or forties. We're working with people in there's thirties, forties, fifties,
20:47
Speaker 4: sixty seventies, eighty nineties. We have people across the age spectrum.
20:51
Speaker 4: We get to see them retire, make mistakes, make good decisions.
20:55
Speaker 4: And so the idea being that working with a good
20:57
Speaker 4: advisor are our statement of hey you're in a good
21:01
Speaker 4: spot or hey you're ahead of pace is not an
21:05
Speaker 4: uneducated one. It is both an educated one and a
21:09
Speaker 4: and an experienced one. So consider working with an advisor.
21:13
Speaker 4: And then, you know, don't let pride or past mistakes,
21:17
Speaker 4: you know, stop you from making progress. Just sit down
21:20
Speaker 4: with somebody to see what changes you need to make,
21:22
Speaker 4: if any, to build a secure retirement.
21:25
Speaker 1: Great day to do just that. I got to just
21:27
Speaker 1: pick up phone, game a call, a class financial make
21:28
Speaker 1: that appointment six oh eight four four two five six
21:31
Speaker 1: three seven that initially gets to know the appointment will
21:33
Speaker 1: be complimentary to you again their number six oh eight
21:35
Speaker 1: four four to two five six three seven. Time now
21:38
Speaker 1: for the money in Motion listener question corner and Diane
21:42
Speaker 1: from Madison time to write in. She says, Hi, there,
21:44
Speaker 1: I'm sixty three years old and a widow. I feel
21:47
Speaker 1: very fortunate to be in a stable financial position, but
21:50
Speaker 1: my adult son is looking to buy his first home
21:53
Speaker 1: and is struggling with the high prices and interest rates.
21:56
Speaker 1: I'm considering taking out a home equity loan or dipping
21:58
Speaker 1: into my retirement save to help him with a down payment.
22:02
Speaker 1: Is this a good idea? And CJ, I'm going to
22:04
Speaker 1: step away from this and I'm leaving this up to you.
22:08
Speaker 4: Well, Diane, Again, I hope you know some of you
22:10
Speaker 4: listening to Diane's question may have your own opinions about this,
22:14
Speaker 4: but believe it or not, these are the questions that
22:16
Speaker 4: people have, and so Diane, thank you for asking it,
22:19
Speaker 4: and I encourage everybody else to consider doing the same.
22:22
Speaker 4: But again, thank you, thank you for your thoughtful question.
22:25
Speaker 4: And first off, it's clear that you love your son
22:28
Speaker 4: and you want him to succeed, and that's certainly admirable,
22:31
Speaker 4: But here's an important truth. Your retirement, Diane needs to
22:34
Speaker 4: come first. At age sixty three, from what you said
22:37
Speaker 4: in your question, you're likely on the doorstep of retirement
22:40
Speaker 4: or already there, and obviously, taking on new debt, especially
22:45
Speaker 4: something like a home equity loan, can significantly strain your
22:48
Speaker 4: own financial picture your own retirement. Likewise, withdrawing from retirement
22:53
Speaker 4: savings to help your son not only reduces your nest egg,
22:57
Speaker 4: but can also come with tax consequences depending upon where
22:59
Speaker 4: you're pulling that money from. So that said, if you
23:02
Speaker 4: run the numbers and your retirement is already well funded,
23:06
Speaker 4: gifting a reasonable and affordable amount from your savings without
23:11
Speaker 4: borrowing or jeopardizing your financial future could be an option
23:14
Speaker 4: that we've got affirm like ours would support. The irs
23:18
Speaker 4: allows you to gift up to nineteen thousand dollars per
23:21
Speaker 4: person per year in twenty twenty five without triggering any
23:24
Speaker 4: gift tax of reporting requirements. So kind of key takeaway
23:29
Speaker 4: here is your retirement needs to come first. You wanting
23:32
Speaker 4: to help your son, you know, buy a home, because
23:35
Speaker 4: you're right, interest rates are higher prices are higher. We
23:38
Speaker 4: get that. So if you wanted to help your son,
23:40
Speaker 4: kind of like a nineteen thousand dollars gift, assuming that's
23:43
Speaker 4: not going to submarine your own retirement, could be something
23:45
Speaker 4: you move towards. And you know, Diane, that could even
23:48
Speaker 4: become a multi year gift if you said, hey, well
23:51
Speaker 4: I really want to give them more like one hundred
23:53
Speaker 4: thousand dollars. Okay, maybe you give him nineteen thousand now
23:56
Speaker 4: nineteen thousand the next year. You get the idea you
23:59
Speaker 4: could do that, assuming it's not going to submarine your
24:01
Speaker 4: own retirement. And there are rare instances where even going
24:06
Speaker 4: above that nineteen thousand is something we might support. But
24:09
Speaker 4: final thought, Diane, and this is I want everybody to
24:12
Speaker 4: hear this. If you loan money to children that is
24:16
Speaker 4: expected to be paid off, which, Diane, you didn't specifically
24:19
Speaker 4: say this, but I want to address this topic. You
24:22
Speaker 4: loan money to your children at lower interest rates because
24:25
Speaker 4: you want to help them, but notice you're not gifting
24:28
Speaker 4: it to them, you're loaning it to them. You will
24:31
Speaker 4: permanently change the dynamic of the parent child relationship. We
24:36
Speaker 4: would just highly suggest don't do it. If you're going
24:41
Speaker 4: to give money to your children. Gift it to them.
24:44
Speaker 4: What they do with it is up to them. But
24:47
Speaker 4: don't become the lender to your children. You will permanently
24:52
Speaker 4: change the dinner table. So there you go. There's some
24:55
Speaker 4: direct guidance. I hope that was helpful. Diane. Obviously call
24:58
Speaker 4: her office if you have any other questions.
25:00
Speaker 1: A great question, great answer. As always, don't forget. If
25:02
Speaker 1: you've got a question, you can email. If you head
25:04
Speaker 1: on over to Cossfinancial dot com. You can email right
25:07
Speaker 1: from the website. Also their telephone number six oh eight
25:10
Speaker 1: four four two five six three seven. No charge for
25:12
Speaker 1: that initial get to know your appointment at Loss Financial.
25:15
Speaker 1: It will be complimentary to you again their number six
25:17
Speaker 1: oh eight four four two five six three seven. Hold
25:20
Speaker 1: on down to that telephone number now because it's time
25:22
Speaker 1: for the class quiz question of the week. It works
25:24
Speaker 1: like this. In just a moment, I'll ask you the
25:26
Speaker 1: class quiz question of the week. We'll then have thirty
25:28
Speaker 1: minutes from the today's program to call the Class Financial
25:30
Speaker 1: office right here in Madison at six oh eight four
25:33
Speaker 1: four two five six three seven. If you are the
25:35
Speaker 1: first caller with correct answer, you'll win this week's prize,
25:38
Speaker 1: which is a twenty five dollars gift card to Best Buy.
25:41
Speaker 1: This week's Class Quiz Question of the week Is this
25:44
Speaker 1: true or false? Contributions to a health savings account are
25:48
Speaker 1: considered triple tax advantage savings vehicles. Is that true or
25:54
Speaker 1: is that false? Telephone number six soh eight four four
25:56
Speaker 1: two five six three seven, first call with correct answer.
25:58
Speaker 1: When's twenty five dollars gift guard two Best Buying again.
26:01
Speaker 1: That's Class Financial Office right here in Madison. Six oh
26:03
Speaker 1: eight four four two five six three seven C J Nate.
26:07
Speaker 1: It's always great chatting with both of you, guys. Have
26:09
Speaker 1: a great day and we'll do it again real soon.
26:11
Speaker 4: Thanks Sean.
26:12
Speaker 1: All right, thanks Sean, Take care guys. News comes your
26:15
Speaker 1: way next year. On thirteen ten, wu ib A