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New Year, New Opportunities to Meet Your Budget Goals · Money In Motion with Klaas Financial

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  Speaker 1: And our phone lines they are open for you right now.
• 0:03
  Speaker 1: If you've got questions for our retirement planning professionals love
• 0:06
  Speaker 1: to have you join us this morning. Telephone number to
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  Speaker 1: get on the air six oh eight three two one
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  Speaker 1: thirteen ten. That's six oh eight three two one thirteen ten.
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  Speaker 1: We'll be chatting this morning with CJ. Closs and Eric
• 0:16
  Speaker 1: Schwartz of Kloss Financial. Don't forget you learn more about
• 0:19
  Speaker 1: class Financial on their website CLSs financial dot com. That's
• 0:22
  Speaker 1: Coss Klaas Financial dot com. Telephon umper for the office
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  Speaker 1: right here in Madison six so eight four four two
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  Speaker 1: five six three seven. No charge for that initial get
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  Speaker 1: to know your appointment tech Loss Financial. It will be
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  Speaker 1: complimentary to you. I can their number six oh eight
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  Speaker 1: four four two five six three seven as mentioned talk
• 0:39
  Speaker 1: this morning with CJ. Closs and Eric Schwartz. CJ, how
• 0:41
  Speaker 1: you doing this week?
• 0:43
  Speaker 2: I'm doing great?
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  Speaker 3: How are you fooling? I'm doing really really well? Eric?
• 0:45
  Speaker 1: How are you doing keeping warm?
• 0:48
  Speaker 4: I'm I'm doing my best winters back? Yeah, I can't
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  Speaker 4: complain too much.
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  Speaker 1: Yeah, especially earlier this week that weather was just outstanding.
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  Speaker 4: Spring was here.
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  Speaker 3: You're ready one day? Yeah, we did it and it
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  Speaker 3: was Uh.
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  Speaker 1: It is definitely a fantastic day, and of course it's
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  Speaker 1: a great opportunity.
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  Speaker 3: Speaking of great days, if you haven't.
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  Speaker 1: Had a chance to learn more about Colass Financial, I
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  Speaker 1: urge you to head on over to the website coassfinancial
• 1:09
  Speaker 1: dot com. That's Coss k l aas financial dot com.
• 1:13
  Speaker 1: You can learn about the team at Coss Financially. You
• 1:15
  Speaker 1: can learn about their separate divisions. You can also schedule
• 1:17
  Speaker 1: a complementary conversation right at cossfinancial dot com. Speaking of
• 1:21
  Speaker 1: complementary conversations, you can also give them a call six
• 1:23
  Speaker 1: oh eight four four two five six three seven. No
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  Speaker 1: charge for that initial get to know your appointment at
• 1:28
  Speaker 1: Coss Financial. It will be complementary to you again that
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  Speaker 1: number six oh eight four four two five six three seven.
• 1:35
  Speaker 1: We're going to be talking about when it comes to
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  Speaker 1: planning and being very precise about your planning and kind
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  Speaker 1: of putting out that money management blueprint. We'll get to
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  Speaker 1: that in just a moment. A couple of things as mentioned,
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  Speaker 1: phone lines are open. Love to gate your retirement related questions,
• 1:48
  Speaker 1: Love to get you on the air with those also
• 1:51
  Speaker 1: got a great chance for you to win a fantastic
• 1:53
  Speaker 1: prize from our friends at Class Financial, a twenty five
• 1:55
  Speaker 1: dollars gift card to Amazon with the class quiz questioning
• 1:58
  Speaker 1: the week, I'll tell you a little bit later on
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  Speaker 1: in the out or a half hour about how you
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  Speaker 1: can win that little note. Oftentimes, both the question and
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  Speaker 1: answer to the week's class quiz question the week question
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  Speaker 1: comes up during the program, and before we start this
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  Speaker 1: week's conversation, let's actually take a look back at last
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  Speaker 1: week's show and get the question and answer there as well.
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  Speaker 3: Eric, absolutely so.
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  Speaker 4: Last week on our show, we talked about the difference
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  Speaker 4: between the fiduciary standard and something a little simpler than that,
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  Speaker 4: which is suitability. And our question last week was the
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  Speaker 4: fiduciary standard is underscored by something commonly referred to as
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  Speaker 4: best interest or good enough? Which of those two is correct?
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  Speaker 4: And the correct answer last week for that fiduciary standard
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  Speaker 4: is best interest.
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  Speaker 1: And if you miss any part of that show, a
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  Speaker 1: lot of really important information as you make some of
• 2:49
  Speaker 1: your decisions when it comes to retirement planning and those
• 2:52
  Speaker 1: type of things. It was a very informative program last week,
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  Speaker 1: and listen back online at clossfinancial dot com. That's closs
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  Speaker 1: k l a a financi dot com. Don't forget you
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  Speaker 1: have another chance to win today on the program twenty
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  Speaker 1: five dollars gift card to Amazon. Tell you a little
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  Speaker 1: bit about that later on the show. As mentioned, we're
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  Speaker 1: going to be talking this week about how folks can
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  Speaker 1: set them selves up for a financially successful twenty twenty six,
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  Speaker 1: things like budgets and savings goals and other good financial
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  Speaker 1: habits and CJ. How can folks really make sure they're
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  Speaker 1: starting off this year on the right financial foot?
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  Speaker 2: Yeah, great question, Sean. Today in today's show, we're going
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  Speaker 2: to be talking a lot about kind of the fundamentals
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  Speaker 2: of managing your cash flow, and we're going to start
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  Speaker 2: with the most basic part of that, which is tracking
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  Speaker 2: your expenses. Now, as we discuss this today, you know,
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  Speaker 2: I want everybody to think of like building a home.
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  Speaker 2: If you build a home, I think most most adults
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  Speaker 2: who have ever owned a home understand that the least
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  Speaker 2: kind of sexy part of the home, but the most
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  Speaker 2: critical part of the home is the foundation that you lay.
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  Speaker 2: If you go talk to any general contractor or builder,
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  Speaker 2: they will they will say, how did you how did
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  Speaker 2: you secure that wall? Right, is that just sheet rock
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  Speaker 2: or did you actually put you know, up two bipores
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  Speaker 2: in between it. So, in a similar way, like a home,
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  Speaker 2: you need a foundation. It's what stops it from blowing
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  Speaker 2: over when a big storm comes through. Well, you know
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  Speaker 2: why am I talking about this because in the context
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  Speaker 2: of your financial health and your future finances, a humongous
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  Speaker 2: part of whether or not you will succeed or fail,
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  Speaker 2: whether you will blow over in a storm or stand
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  Speaker 2: up tall, is whether or not you get a hold
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  Speaker 2: of your cash flow and don't over complicate cash flow.
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  Speaker 2: Cash Flow is money in and money out. That's all
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  Speaker 2: it is. And so you know, expense tracking, as we're
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  Speaker 2: talking about it is really about awareness. Most people overspend
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  Speaker 2: because they're unaware, not because they're financially irresponsible. Tracking shows
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  Speaker 2: you reality without judgment. Well, most people can name their
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  Speaker 2: big bills like oh, you know, I have a mortgage,
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  Speaker 2: They're much less clear about their daily spending. How much
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  Speaker 2: did I spend on that coffee or that app or
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  Speaker 2: that convenience store purchase when I went to Walgreens. So
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  Speaker 2: those are the types of leaks in your cash flow
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  Speaker 2: or in your budget that can weaken your overall future.
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  Speaker 3: Talking this Morning with CJ.
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  Speaker 1: Closs and Eric Schwartz, our retirement planning professionals from Class Financial.
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  Speaker 1: It's the new year. Maybe you have a new question.
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  Speaker 1: Love to hear from this morning? Gets you on the
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  Speaker 1: air six oh eight three two one thirteen ten. That's
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  Speaker 1: six oh eight three two one thirteen ten, gets you
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  Speaker 1: right on the air with CJ and Eric of Class Financial.
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  Speaker 1: The website Coss Financial dot com. That's class klaas financial
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  Speaker 1: dot com. I know there's some people that are saying,
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  Speaker 1: you know what, I'd love to keep better track of
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  Speaker 1: my finances, but I just don't have time. Is there
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  Speaker 1: any kind of realistic way to track without kind of
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  Speaker 1: making that a full time job?
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  Speaker 3: CJ? Yeah, good question.
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  Speaker 2: There certainly is, although I will remind everybody nothing good
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  Speaker 2: happens you're in your life without efforts and time. So
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  Speaker 2: it'd be like saying to your spouse, you know, I'd
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  Speaker 2: really love to be in a good relationship with you,
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  Speaker 2: but I just don't have time for that. Yeah, try
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  Speaker 2: that one on for size and see how it fits
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  Speaker 2: with your spouse. So in a similar way, what i'd
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  Speaker 2: say to you is, yes, we're going to give you
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  Speaker 2: some tips and tools for simplifying this, and it's like
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  Speaker 2: anything else, the more time you spend on anything, the
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  Speaker 2: more efficient you will get at doing that as well,
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  Speaker 2: meaning you can do the same task in less time.
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  Speaker 2: But there is no one size fits all when it
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  Speaker 2: comes to this kind of tracking of expenses and budgeting. Now,
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  Speaker 2: there are a lot of apps available to help when
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  Speaker 2: tracking and analyzing spending. The apps will actually allow you
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  Speaker 2: to kind of like link up your credit card and
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  Speaker 2: your bank accounts to extract your transaction level data, and
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  Speaker 2: then you can organize everything with the help of the app. Often,
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  Speaker 2: you know, there's systems like Quicken and QuickBooks and many
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  Speaker 2: others that allow you to track all of this pull
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  Speaker 2: it in. They'll even like auto categorize based on what
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  Speaker 2: they think the expense was. You can modify those categories,
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  Speaker 2: and this is great if that route isn't for you,
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  Speaker 2: which in a moment here I'm going to talk about
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  Speaker 2: how that route isn't for a lot of people. You
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  Speaker 2: can always do things the old fashion way and review
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  Speaker 2: your transactions manually to keep it from becoming overwhelming. Just
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  Speaker 2: take five minutes a day to review and categorize your
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  Speaker 2: daily transactions, and then by doing this you'll get a
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  Speaker 2: sense of where your money is actually going. Now I
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  Speaker 2: hinted at this. I said, for a lot of people,
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  Speaker 2: these apps are not the right fit. Here's why. Here's
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  Speaker 2: the proof, everybody. If simplification of tracking expenses was the
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  Speaker 2: problem to be solved, we would all be much better
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  Speaker 2: off financially than our grandparents were. Let me repeat that,
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  Speaker 2: if simplification of tracking where your money was going was
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  Speaker 2: the problem that needed to be solved, we would all
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  Speaker 2: be much better off financially than our grandparents were because
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  Speaker 2: we have tons of tools that our grandparents never had.
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  Speaker 2: But surprise, surprise, our grandparents were actually much better at
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  Speaker 2: managing money than we are today. So what I want
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  Speaker 2: to say to you is it's not about tools, it's
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  Speaker 2: about effort. And often the tools create so much simplicity
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  Speaker 2: for us that we stop thinking our brains turn off.
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  Speaker 2: So my encouragement would be I'm not saying what's right
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  Speaker 2: for you. If a technology tool helps you, God bless you,
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  Speaker 2: go ahead and do it. But if you're finding that
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  Speaker 2: all these apps and tools are just leading you down
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  Speaker 2: a path that leads to nowhere, then go back to
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  Speaker 2: pen and paper and just right just write down, oh
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  Speaker 2: I bought a four dollar coffee today and I bought
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  Speaker 2: a and just categorize it the good old fashioned way.
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  Speaker 2: Whatever works best is what we would support, CJ.
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  Speaker 1: Have you seen how much stuff is out there though,
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  Speaker 1: and how easy they make it to buy stuff?
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  Speaker 4: Well, that's does it right. I'm like, who's winning the day?
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  Speaker 4: The budgeters or the marketers?
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  Speaker 3: And I think it's the market. Yes, it's talking this
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  Speaker 3: morning with CJ.
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  Speaker 1: Claws and Eric Schwartz, our retirement planning professionals from Class Financial,
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  Speaker 1: the website class financial dot com. That's Class k l
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  Speaker 1: aa S financial dot com. Tell for number six O
• 9:00
  Speaker 1: eight four four two five six three seven, no charge
• 9:03
  Speaker 1: for the day, She'll get to know you. Appointment at
• 9:05
  Speaker 1: Colss Financial. It will be complimentary to you again the
• 9:07
  Speaker 1: number six O eight four four two five six three seven.
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  Speaker 1: So CJ outlined forrest kind of the importance of understanding
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  Speaker 1: where our money is going. Now, Eric, let's take it
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  Speaker 1: one step further. What where do we go then from there?
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  Speaker 4: Yeah, I first want to just point out here before
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  Speaker 4: we jump into this one. For CJ, I did I
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  Speaker 4: do have a four dollars coffee sitting next to me here,
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  Speaker 4: and I did write it down on a post it note.
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  Speaker 4: So thanks getting We track that and and I'll check
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  Speaker 4: it with you after the show.
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  Speaker 2: Here you're headed towards good things in the future, Yeah,
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  Speaker 2: I feel it.
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  Speaker 4: I plan to get an email later from my budgeting
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  Speaker 4: app telling me I overspent you.
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  Speaker 1: Yes, sometimes guilty pleasures are good for you.
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  Speaker 3: So let's look at that next step.
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  Speaker 4: Eric. Yeah, so so the next step in our process
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  Speaker 4: here is to actually build your budget. Okay, So budgets
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  Speaker 4: get a really bad reputation. People hear that and they
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  Speaker 4: think restrictions. They think, you know, like like they're sort
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  Speaker 4: of being like parented or told what to do. But budgets,
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  Speaker 4: they're really more about like figuring out how you're going
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  Speaker 4: to spend your money. You have a finite amount of
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  Speaker 4: dollars that come in each month, and this is actually
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  Speaker 4: telling you where your your money is going to be
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  Speaker 4: going before it actually disappears. And the level of detail
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  Speaker 4: that you choose to get into with your budget is
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  Speaker 4: really up to you. I mean, CJ and I do
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  Speaker 4: this with folks all the time, and some form or
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  Speaker 4: some really really detailed budgets with you know, I spent
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  Speaker 4: this amount on coffee, I spent that amount on you know,
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  Speaker 4: very specific things. Some people need that they need that
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  Speaker 4: and discipline and information to kind of stay on track.
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  Speaker 4: But then for other people, they'll say, you know, I
• 10:53
  Speaker 4: know how much comes in every month. I know I
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  Speaker 4: want to have, you know, twenty five percent of that
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  Speaker 4: going to to this and fifty percent to that, And
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  Speaker 4: they use those kind of broader categories, but they're still
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  Speaker 4: tracking it. Right. If you're if you're looking to be
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  Speaker 4: kind of one of those really really specific, category oriented butchers,
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  Speaker 4: you can use an app CJ like you need a
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  Speaker 4: budget or Monarch Money is another one that's out there.
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  Speaker 4: They'll do some of that heavy lifting for you. They'll
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  Speaker 4: even offer you some guidelines as to what percentage of
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  Speaker 4: your income should go to which category of expense. But this,
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  Speaker 4: this next step we're talking about here is really about
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  Speaker 4: taking Like that first step is about tracking or spending,
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  Speaker 4: gathering the information you need to make a you know,
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  Speaker 4: an informed decision about how you're going to spend your money.
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  Speaker 4: And then this next step is actually saying, Okay, here's
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  Speaker 4: how much I get I get every every two weeks
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  Speaker 4: from working right, and here's my total income, this is
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  Speaker 4: my net pay. How am I actually going to divide
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  Speaker 4: that up. There's a whole bunch of ways that that
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  Speaker 4: you could do this for simplicity. Today, just as an example,
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  Speaker 4: I'm going to talk about one kind of budgeting of thumb,
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  Speaker 4: just to kind of demonstrate how you can build a
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  Speaker 4: simple budget. This one is called the fifty to thirty
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  Speaker 4: twenty rule, so it's a pretty common one. It suggests
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  Speaker 4: that fifty percent of your income would go towards your
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  Speaker 4: needs such as housing, groceries, utilities, thirty percent of your
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  Speaker 4: income should go towards wants like hobbies or entertainment. Then finally,
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  Speaker 4: twenty percent of your income should go towards you know,
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  Speaker 4: savings and debt reduction. And to be clear, this is
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  Speaker 4: just an example. It gives you, gives you some place
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  Speaker 4: to start. It's not for everybody, but you know, if
• 12:36
  Speaker 4: you can apply this to your specific situation, it puts
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  Speaker 4: you in a position to start adjusting it for yourself.
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  Speaker 4: So some people may have higher debt payments or more
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  Speaker 4: aggressive saving goals. This is just a spot to start,
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  Speaker 4: so take some time review your own income, review your expenses,
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  Speaker 4: and kind of build guardrails around that that will actually
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  Speaker 4: help you meet your goals.
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  Speaker 1: Really good starting point this morning as we talk with
• 12:59
  Speaker 1: Eric Schwarz and CJ.
• 13:00
  Speaker 3: Closs.
• 13:00
  Speaker 1: They are our retirement planning professionals from Class Financial website
• 13:04
  Speaker 1: coss Financial dot com that's coss k l a as
• 13:07
  Speaker 1: financial dot com. Great place to get to know the
• 13:09
  Speaker 1: team at Coss Financial. Also how they can assist you
• 13:12
  Speaker 1: or if you're a business the different divisions of Class Financial,
• 13:15
  Speaker 1: get to know the team there as well. Class Financial
• 13:17
  Speaker 1: dot com. You can also schedule a complementary chat right
• 13:20
  Speaker 1: from the website, or you can pick a phone give
• 13:22
  Speaker 1: a call six O eight four four two five six
• 13:24
  Speaker 1: three seven. First apployment at Coss Financial. It will be
• 13:27
  Speaker 1: complementary too, not cost you a thing again their number
• 13:30
  Speaker 1: six O eight four four two five six three seven
• 13:32
  Speaker 1: will continue our conversation with CJ and Eric. We will
• 13:35
  Speaker 1: do that next as Money in Motion with Coss Financial
• 13:38
  Speaker 1: continues right here a thirteen ten wib I talking with
• 13:41
  Speaker 1: our retirement planning professionals CJ.
• 13:43
  Speaker 3: Closs and Eric Schwartz.
• 13:44
  Speaker 1: Of course they come to us from Coss Financial right
• 13:46
  Speaker 1: here in Madison. The website Coss Financial dot com that's
• 13:50
  Speaker 1: coss k l a a s Financial dot com. Are
• 13:53
  Speaker 1: TOEPH number six so eight four four two, five, six,
• 13:55
  Speaker 1: three seven, talking about the importance of budgeting and of
• 13:59
  Speaker 1: course with new Year, a lot of us looking to
• 14:02
  Speaker 1: better ourselves, improve our position overall, feel better about things,
• 14:05
  Speaker 1: and of course build some security. And great day to
• 14:08
  Speaker 1: do that talking about some of the important things when
• 14:11
  Speaker 1: it comes to budgeting, and Eric, you know, we talked
• 14:15
  Speaker 1: just before the break about kind of making that budget,
• 14:17
  Speaker 1: but what about finding ways to actually stick to it.
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  Speaker 1: I'm one of these guys. I like to talk a
• 14:23
  Speaker 1: good game, but sometimes when it comes to putting things
• 14:26
  Speaker 1: in action, not quite as great about that part of
• 14:29
  Speaker 1: the process.
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  Speaker 4: You know, I think you're not alone, Sean. I think
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  Speaker 4: there's a reason that we generally around the beginning part
• 14:37
  Speaker 4: of the year talking to folks a lot about this.
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  Speaker 4: It's tough to do. Life happens, right. We make these
• 14:42
  Speaker 4: plans and we have these great ideas, and it's not
• 14:46
  Speaker 4: easy to stick to a budget. So the best advice
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  Speaker 4: I can offer is to be flexible. So your budget
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  Speaker 4: needs to be able to adjust to real life. Now
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  Speaker 4: this doesn't mean that, you know, oh, just don't worry
• 14:57
  Speaker 4: about it, because things will happen and it's not your fault.
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  Speaker 4: It's more like when you're building this budget, you need
• 15:02
  Speaker 4: to build in some contingency, some wiggle room, right, So
• 15:06
  Speaker 4: setting aside that contingency in your budget to cover more
• 15:10
  Speaker 4: expensive months. Right, annual expenses, Hey, my my home and
• 15:15
  Speaker 4: auto insurance came do and I, you know, maybe I
• 15:18
  Speaker 4: pay it twice a year or once a year. So
• 15:20
  Speaker 4: I have a large expense this month. I need to
• 15:22
  Speaker 4: actually be setting money aside in advance so that I
• 15:25
  Speaker 4: have money to pay that or I have to pay
• 15:27
  Speaker 4: my annual life insurance premium or Christmas time, I know
• 15:31
  Speaker 4: I'm going to be spending more on gifts. It's all
• 15:33
  Speaker 4: about building in a contingency and planning for those future expenses,
• 15:38
  Speaker 4: and that way, you know, when when other surprises that
• 15:41
  Speaker 4: you don't plan on pop up, you can still stay
• 15:44
  Speaker 4: on track. So a budget that's too rigid and it
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  Speaker 4: kind of only works under the best of circumstances, it's
• 15:50
  Speaker 4: generally not going to last long because people get frustrated
• 15:53
  Speaker 4: and we don't like doing things that it doesn't feel
• 15:56
  Speaker 4: like we're good at. And so if you if you
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  Speaker 4: build a really really i'll call it aspirational budget or
• 16:04
  Speaker 4: spending plan, and you think, gosh, all I need to
• 16:06
  Speaker 4: do is just is just stick to this and everything
• 16:09
  Speaker 4: is going to be I'm going to feel so much better.
• 16:12
  Speaker 4: Odds are something is going to happen, an unexpected expense,
• 16:16
  Speaker 4: car repair, just something you are not thinking about is
• 16:19
  Speaker 4: going to come up. So be flexible and it'll help
• 16:22
  Speaker 4: keep you from from getting frustrated and giving up on
• 16:25
  Speaker 4: this new year's resolution.
• 16:27
  Speaker 1: Talking this morning with Eric Schwartz and CJ clossup Class
• 16:29
  Speaker 1: Financial Online, Coss Financial dot com that's Coss k l
• 16:32
  Speaker 1: a as Financial dot com and CJ. Eric did talk
• 16:35
  Speaker 1: about it's kind of that contingency planning when it comes
• 16:38
  Speaker 1: to your budget in that earlier section, what about kind
• 16:41
  Speaker 1: of a larger and maybe a more a more thoughtful
• 16:44
  Speaker 1: contingency plan.
• 16:46
  Speaker 2: Yeah, that's a great point, Sean. So, as Eric mentioned,
• 16:49
  Speaker 2: life happens, and we want to be in a position
• 16:52
  Speaker 2: to weather unexpected expenses. So we generally suggest that folks
• 16:56
  Speaker 2: set aside three to six months worth of living expenses
• 17:00
  Speaker 2: in an emergency fund. The emergency fund should be an
• 17:03
  Speaker 2: account separate from your normal savings account that you don't
• 17:07
  Speaker 2: use unless you absolutely need to. Now, some common things
• 17:12
  Speaker 2: that happen with these emergency funds is number one, people
• 17:16
  Speaker 2: don't set them to the side and they're just in
• 17:17
  Speaker 2: a general account and then they end up getting spent.
• 17:20
  Speaker 2: Number two, people don't define emergency, and so you know,
• 17:24
  Speaker 2: they come in and meet with us or just look
• 17:26
  Speaker 2: at this as spouses together and they go, well, you know,
• 17:30
  Speaker 2: we had that emergency fund, but then you know, we
• 17:32
  Speaker 2: got the new car, and it's like, oh, that's interesting.
• 17:36
  Speaker 2: I wouldn't define a new car as an emergency, right,
• 17:39
  Speaker 2: so you do you do want to think of emergency
• 17:42
  Speaker 2: through the lens of unplanned for, unknown expense, something that
• 17:48
  Speaker 2: can be planned for you should not call an emergency.
• 17:52
  Speaker 2: And then kind of error number three that we see
• 17:53
  Speaker 2: within this is people calling these one time expenses that
• 18:00
  Speaker 2: actually could somewhat be planned for an emergency. It sounds
• 18:03
  Speaker 2: a lot like the one I was just mentioning before.
• 18:05
  Speaker 2: But let me define this better, like, hey, the water
• 18:08
  Speaker 2: heater went out. That is an emergency for sure, I'm
• 18:12
  Speaker 2: not saying it's not. But do we know the you
• 18:16
  Speaker 2: know the age of our water heaters, do we know
• 18:18
  Speaker 2: the furnaces? Can we act or maybe our roof is
• 18:21
  Speaker 2: another great example of this, Right, Oh, I've got a
• 18:24
  Speaker 2: twenty eight year old roof and it just turns out
• 18:26
  Speaker 2: that it started to leak in the twenty ninth year.
• 18:28
  Speaker 2: It's like, yeah, I don't know that I would call
• 18:30
  Speaker 2: that an emergency. That's probably something that we should have
• 18:33
  Speaker 2: been mindful of and started to set money aside for.
• 18:36
  Speaker 2: So truly, the emergency fund is meant for the I
• 18:40
  Speaker 2: had no way of planning for this. Okay, here would
• 18:43
  Speaker 2: be an example. I have a five year old roof.
• 18:46
  Speaker 2: I get hail damage and my insurance company won't pay,
• 18:49
  Speaker 2: and I've got leaks all over the place. Now that
• 18:52
  Speaker 2: shouldn't happen. If that happens, you got a terrible insurance company.
• 18:55
  Speaker 2: But I think everybody gets the point. There are certainly
• 18:59
  Speaker 2: definable emergencies. Or my child got very sick and I
• 19:04
  Speaker 2: needed to, you know, get some emergency medicine for them
• 19:07
  Speaker 2: that wasn't covered by our health insurance plan. I think
• 19:10
  Speaker 2: you everybody gets the idea, really be cautious and set
• 19:13
  Speaker 2: aside these emergency reserves. Now, we would also say start reasonably.
• 19:20
  Speaker 2: Sometimes people will go, well, gosh, six months of living
• 19:23
  Speaker 2: expenses is fifty thousand dollars for our family. There's just
• 19:26
  Speaker 2: no way I can get there, I understand, So start
• 19:29
  Speaker 2: with one thousand, start with a couple thousand dollars, pay
• 19:32
  Speaker 2: down your high interest debt, and slowly build up that
• 19:35
  Speaker 2: emergency fund to where you need it to be. And
• 19:38
  Speaker 2: just remember the things that are the hardest to accomplish
• 19:41
  Speaker 2: are also the hardest to get rid to of f
• 19:45
  Speaker 2: And what do I mean by that? If it takes
• 19:47
  Speaker 2: me three years to get an emergency fund, I will
• 19:51
  Speaker 2: bet that you are not easily going to give up
• 19:53
  Speaker 2: that emergency fund. And that's a good thing. So if
• 19:57
  Speaker 2: it takes you a long time to build that up,
• 19:59
  Speaker 2: just no, oh that it'll probably be a pattern of
• 20:02
  Speaker 2: life that you will stick with.
• 20:06
  Speaker 3: Talking this morning with CJ.
• 20:07
  Speaker 1: Closs and Eric Schwartz, our retirement planning professionals from Class
• 20:10
  Speaker 1: Financial online Cossfinancial dot com. That's Coss k l a
• 20:13
  Speaker 1: as Financial dot com. I hope you get a chance
• 20:15
  Speaker 1: to check out the website. Don't forget You can, of course,
• 20:18
  Speaker 1: start a complementary conversation right online or give them a
• 20:20
  Speaker 1: call at Class Financial six oh eight four four two five,
• 20:23
  Speaker 1: six three seven. That first call the Class Financial, that
• 20:26
  Speaker 1: first appointment not going to cost you a thing. That'll
• 20:28
  Speaker 1: be complementary again their number six oh eight four four two, five, six, three, seven,
• 20:32
  Speaker 1: looks into our conversation with c J and Eric next
• 20:34
  Speaker 1: as Money in Motion with COSS Financial continues right here
• 20:37
  Speaker 1: on thirteen ten, Wuiba talking with CJ Closs and Eric Schwartz,
• 20:42
  Speaker 1: our retirement planning professionals from Class Financial Online Cossfinancial dot com.
• 20:46
  Speaker 1: That's coss k l aa S Financial dot com. And
• 20:49
  Speaker 1: as we've kind of worked through this stuff, Eric talk
• 20:51
  Speaker 1: a lot about cash flow management and getting started kind
• 20:54
  Speaker 1: of the right way for twenty twenty six. What are
• 20:57
  Speaker 1: some of the other kind of like big takeaways folk
• 20:59
  Speaker 1: should should be gathering from today's show, Eric, Yeah, if.
• 21:03
  Speaker 4: I was a breakdown the takeaways from the show here
• 21:08
  Speaker 4: and what I would call kind of our money management
• 21:10
  Speaker 4: blueprint for twenty twenty six, I'd summarize it in three
• 21:13
  Speaker 4: main points. So first one is you need be tracking
• 21:17
  Speaker 4: your spending on a regular basis so that you are
• 21:20
  Speaker 4: actually dealing with facts and not just guessing about where
• 21:23
  Speaker 4: your money is going. Second, we want to use that
• 21:26
  Speaker 4: clarity to budget with intention and make sure that we're
• 21:30
  Speaker 4: assigning a job or a purpose to each of those dollars.
• 21:34
  Speaker 4: And third, we want you to be saving consistently so
• 21:37
  Speaker 4: that unexpected events don't derail your future, right, So making
• 21:41
  Speaker 4: sure that you've set aside funds in that emergency fund,
• 21:44
  Speaker 4: or even on a shorter term basis, making sure you're
• 21:47
  Speaker 4: planning for some of those infrequent but known expenses, some
• 21:53
  Speaker 4: of them that CJ was just referencing there, and I
• 21:56
  Speaker 4: know a lot of what we've really talked about today.
• 21:58
  Speaker 4: It may seem pretty simple, but in practice, we see
• 22:01
  Speaker 4: a lot of people struggle with actually implementing this. So
• 22:05
  Speaker 4: much of building kind of these good financial habits is
• 22:08
  Speaker 4: behavioral and nature, right, so we almost have to trick
• 22:10
  Speaker 4: ourselves into too, building these habits through repetition and consistency.
• 22:15
  Speaker 4: So for listeners, I just encourage you as you begin
• 22:19
  Speaker 4: hopefully implementing some of these ideas. It may feel really
• 22:24
  Speaker 4: simple and really like gosh, why am I doing this again?
• 22:27
  Speaker 4: Like I get it, But the really, really great thing
• 22:30
  Speaker 4: about repetition is that it eventually becomes second nature. It
• 22:33
  Speaker 4: eventually becomes a habit, and that's when you can really
• 22:35
  Speaker 4: build financial security for yourself and for those that you
• 22:38
  Speaker 4: care about.
• 22:39
  Speaker 3: A lot of great information this week in the program.
• 22:41
  Speaker 1: Don't forget if you missed any part of today's show
• 22:43
  Speaker 1: or you want to listen back to previous programs, you
• 22:45
  Speaker 1: can always head on over to cossfinancial dot com, subscribe
• 22:48
  Speaker 1: and listen back to the podcast again. That available to
• 22:51
  Speaker 1: you at cossfinancial dot com. That's cost A l aas
• 22:54
  Speaker 1: Financial dot com. While you're there, you can submit a
• 22:56
  Speaker 1: question to be answered right here on the program and
• 22:59
  Speaker 1: the Money and Ocean listener question corner. Chuck wrote in
• 23:02
  Speaker 1: Chuck says he's Chuck from some prairie. He says, I'm
• 23:05
  Speaker 1: fifty seven and planning to retire at sixty. I've been
• 23:08
  Speaker 1: holding off on making money, taking money, excuse me, from
• 23:12
  Speaker 1: my four ROH one K, because I don't want to
• 23:14
  Speaker 1: pay an early withdrawal penalty before fifty nine and a half.
• 23:17
  Speaker 1: But one of my co workers just retired at fifty
• 23:20
  Speaker 1: six and told me he's using his four ROH one
• 23:23
  Speaker 1: K for income without paying any any penalties. How is
• 23:28
  Speaker 1: this possible? And CJ, we'll let you answer Chuck's question.
• 23:32
  Speaker 2: Well, Chuck, thank you so much for submitting this question,
• 23:36
  Speaker 2: because actually we have covered this topic a few times
• 23:39
  Speaker 2: on our show, so so just to kind of remind
• 23:44
  Speaker 2: everybody what Chuck is asking here is Hey, he he's
• 23:48
  Speaker 2: fifty seven, planning to retire at sixty. He knows the
• 23:51
  Speaker 2: age fifty nine and a half rule for pulling money
• 23:54
  Speaker 2: out of retirement account without a penalty. But he's got
• 23:57
  Speaker 2: this friend who's who's saying, I'm fifty six and I'm
• 24:00
  Speaker 2: you are already pulling out without a penalty. What's going
• 24:01
  Speaker 2: on here, Well, your co worker, Chuck is likely using
• 24:05
  Speaker 2: something called the age fifty five rule. So if you
• 24:09
  Speaker 2: leave your job in the year you turn fifty five
• 24:12
  Speaker 2: or older, you can take withdrawals from that employer's four
• 24:15
  Speaker 2: oh one K or four h three B without paying
• 24:19
  Speaker 2: the usual ten percent early withdrawal penalty. Now, I think
• 24:22
  Speaker 2: the IRS doesn't call this an early withdrawal penalty. They
• 24:24
  Speaker 2: call us like an extra tax. Because it sounds nicer,
• 24:27
  Speaker 2: we just call it an early withdraw penalty. So even
• 24:30
  Speaker 2: though he your friend, is only fifty six, because he
• 24:33
  Speaker 2: left his job after turning fifty five, he can use
• 24:37
  Speaker 2: his four oh one K for income. But Chuck, here's
• 24:40
  Speaker 2: the key. This is a really important detail. This rule
• 24:43
  Speaker 2: only applies to the plan from the job you just left,
• 24:47
  Speaker 2: not any other old four oh one K plans, And
• 24:51
  Speaker 2: you do still have to pay taxes on the money
• 24:53
  Speaker 2: you withdraw, you just don't have to pay the penalty.
• 24:57
  Speaker 2: And then here's the other key. The money must be
• 25:00
  Speaker 2: left in that old plan. So say I'm working at
• 25:05
  Speaker 2: XYZ company, I retire at fifty six or fifty seven
• 25:09
  Speaker 2: or fifty eight, so I'm not yet fifty nine and
• 25:10
  Speaker 2: a half. If i retire from there and leave the
• 25:13
  Speaker 2: money in XYZ S four one K plan, then I
• 25:17
  Speaker 2: can pull money out penalty free. But Chuck, if all
• 25:20
  Speaker 2: I do is I roll that over to my IRA, well,
• 25:22
  Speaker 2: now I've got to wait till age fifty nine and
• 25:24
  Speaker 2: a half. So so, Chuck, great question, Love that you
• 25:28
  Speaker 2: submitted it. I will encourage all of our listeners. These
• 25:31
  Speaker 2: are part of the reasons why why people like us
• 25:33
  Speaker 2: have jobs, because there's a lot of dues and don'ts
• 25:35
  Speaker 2: in the internal revenue code. So by all means, reach
• 25:39
  Speaker 2: out to us if you have additional question.
• 25:41
  Speaker 3: It seems like there's a lot more don'ts in the
• 25:42
  Speaker 3: eternal Yes.
• 25:44
  Speaker 1: Sir, talking this morning with CT Clause and Eric Swortz,
• 25:48
  Speaker 1: don't forget. If you've got a question, you two could
• 25:50
  Speaker 1: be just like Chuck. You can email Class Financial head
• 25:53
  Speaker 1: on over the website COLSS Financial dot com. That's coss
• 25:55
  Speaker 1: Klaas Financial dot com. Submit a question right from the
• 25:59
  Speaker 1: web site info at cossfinancial dot com. Of course, you
• 26:02
  Speaker 1: can always give them a call six oh eight four
• 26:04
  Speaker 1: four two five six three seven. Don't forget that initial
• 26:06
  Speaker 1: appoyment at Cost Financial. It will be complimentary to you.
• 26:09
  Speaker 1: You're going on to hold on to that telephone number
• 26:11
  Speaker 1: because it's time now for the Closs Quiz Question the Week.
• 26:13
  Speaker 3: It works like this.
• 26:14
  Speaker 1: In just a moment, I'll ask you the class Quiz
• 26:16
  Speaker 1: question of the week. You will then have thirty minutes
• 26:17
  Speaker 1: from the in today's program to call the Class Financial
• 26:19
  Speaker 1: office right here in Madison at six oh eight four
• 26:22
  Speaker 1: four two five six three seven. If you are the
• 26:25
  Speaker 1: first call correct answer, you will win this week's prize,
• 26:28
  Speaker 1: which is a twenty five dollars gift card to Amazon.
• 26:31
  Speaker 1: This week's COLSS Quiz question the Week. Is this true
• 26:34
  Speaker 1: or false? Experts often suggest setting aside three to six
• 26:39
  Speaker 1: months of expenses as an emergency fund. Is that true
• 26:43
  Speaker 1: or is that false? Telephone number six oh eight four
• 26:45
  Speaker 1: four two five six three seven. That's Class Financial's office
• 26:48
  Speaker 1: right here in Madison. Six oh eight four four two
• 26:51
  Speaker 1: five six three seven. CJ Eric. It's always fantastic chatting
• 26:55
  Speaker 1: with both of you guys. You enjoy this great Dan.
• 26:56
  Speaker 3: We'll do it all again real soon. Thanks Sean, Thanks Sean,
• 26:59
  Speaker 3: see you guys. News comes you way next year. On
• 27:01
  Speaker 3: thirteen ten w IB eight