How to Properly Prepare for Retirement: Don’t Get Left Behind!

11.10.23: Audio automatically transcribed by Sonix

11.10.23: this mp3 audio file was automatically transcribed by Sonix with the best speech-to-text algorithms. This transcript may contain errors.

Speaker1:
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.

Speaker2:
Welcome to your American Retirement with your host, Randy Sams. Get set for a full hour of financial information and economic news affecting your bottom line. Randy works hard each day to educate Americans like you on how to reach the financial freedom they've worked so hard for, and he can help you too. So now let's start the show. Here is your host, Randy Sams. Hello again, Central Arkansas. Welcome to your American retirement. My name is Randy Sams. I want to thank you for joining me on this Saturday morning. Hopefully you've got, uh, so far your Saturday morning has been great. You've had a couple of cups of coffee because I want you to sit back, get your pens and your paper pads, your notepads. So we take a lot of notes. We've got a lot happening. Got a jam packed show on tap for you. And hey, you know, I got to give this plug. Don't forget to check out our show in podcast form on Apple, Google, Spotify, or wherever you get your podcasts. And remember to visit YouTube, our YouTube page. That's youtube.com, and search for your American retirement. You'll see my smiling face. Shout out this morning to all my listeners again in Benton, Arkansas. Hey, just a little plug. I am running for justice of the peace for Saline County elections. Not till 2024, but I just wanted to throw that out. So all my listeners that are in the Saline County area, Benton, Bryant, I'll be running for justice of the Peace in District nine.

Speaker2:
So I appreciate all your prayers and all your support. But hey, let's get ready and kick this show off. You know, folks, I get asked several times, uh, I've been doing this. I've been in this business for 37 years, will be 38 next year. I've enjoyed every year of it, meeting lots of people. Um, my previous jobs, I've traveled all over the country and working for two very large insurance companies. But anyway, I've always focused on the like the senior benefits, annuities, Medicare, retirement benefits, life insurance, and been involved in creating products, uh, in the pricing of products. So I understand, you know, probably a little bit more than maybe some of the agents out there. And I'm not slamming anybody else out there. So don't take that wrong. But having the inside knowledge that I do, I'm able to kind of look at products and kind of decide, is this really going to be a good product for my clients? But I get asked all the time, Randy, you know, you've been doing this radio show and there's a lot of folks out there in the insurance business that don't do radio shows. So. So why did you choose to do a radio show? Well, that's that's a good question. I have been looking at trying to do a radio show for a couple of years now. It's just not being able to run into the right people and I guess the right timing.

Speaker2:
God's timing is always perfect. And, uh, everything kind of came together last year. And as you know, we've been on the air at 101.1 FM. The answer for, oh, gosh, it'll be almost two years, almost two years. So we've had a really good time. And I enjoy doing what I do because, folks, uh, I believe in education. If you've heard me in the past, you know that our objective is to make sure that we educate those people who are getting ready to retire or those people that are in retirement right now, educate you on the products that are available to help address the risk that we are going to face in retirement. That's what we want to do. So we want to set you up. We want to educate you and prepare you for what a safe retirement, a secure retirement, not a risky retirement. So people, if this is the first time you listen to the show, uh, if whether you're in Benton, whether you're in little Rock, whether you're in Bryant, whether you're in Conway, Haskell, wherever you might be. This is why we do the show every week. And I'm going to run through these. I'm not going to elaborate on them a whole lot, but number one, I want to educate retirees and pre-retirees by again, providing valuable information and insights, helping you make informed decisions about your financial future. We believe that knowledge is power, and we don't want our listeners or our clients to ever feel powerless in retirement.

Speaker2:
Folks, there's a lot of questions. What risk are we going to face in retirement? That's what we like to do when we sit down and do a consultation with our clients, we go over what risk you are going to basically run into. You're going to see in retirement. No, no two ways about it, okay. If we live long enough, we're going to see another market crash. If we live long enough, we're going to probably have some health issues. All right. If we live long enough, we're going to be concerned about spending too much money or not spending enough money, all right. Or not leaving any money for the kids. So there's a lot of things that we need to address. Rest. So we want to educate you on what you can do to be prepared for your hopefully happy, happy, happy retirement. That's what we're all about. Number two, we want to address retirement challenges that you, as retirees and pre-retirees will encounter. And we want to offer smart strategies, safe strategies, and solutions to help navigate these obstacles. Folks, you're going to have to look at longevity risk. You don't have to look at market risk. You don't have to look at inflation risk. There's a bunch of them that we have to look at. Sequence of return risk. All right. But those are things that we would address with you face to face.

Speaker2:
And we want to empower smart financial decision making by sharing our knowledge. Again. You know, you heard me earlier. I'll be in the business for 38 years as of 2024, which is just right around the corner. Folks take advantage of our knowledge and our expertise, as well as examples of how we are helping listeners and clients every week. I've got a great example of that today. Hopefully you'll be taking notes and you can give us a call once you listen to this new concept. Well, it's not really new. It's I've done it several times in the past, but I think it's been a while since I've spoken about it on the show. But later on, I'm going to give you a concept that we just put together for a gentleman. One of our listeners that gave me a call and we were able to put together what I feel like is a fantastic plan for he and his family. Number four, we want to promote financial literacy because so many people feel like financial freedom is simply out of reach. So I'm here to answer your questions and help you understand what you need to do in order to reach your own retirement goals. Folks, you've heard me say this again smart financial. We do not do cookie cutters. We're not one of those people or one of those farms, or one of those organizations that have come to you.

Speaker2:
And I'm going to offer you the same program that I just did for Mr. and Mrs. Smith or Mr. and Mrs. Jones or whoever it might be. All right. We're going to sit down and we're going to go over some things we're going to put together, uh, what you have as far as your finances go, what we can work with, what are your objectives in retirement? What are you wanting to do? What are your basic living expenses? We got to address those first. And then we're going to look at your wants and your needs. Are we going to put together what we call a paycheck. And then we can also put together what we call a paycheck a pla y c h e k paycheck. That's what we want to do for you. Number five, we want to serve as your trusted God. I want to earn your business. And we do that by sitting down. No obligation on your part. And let's see what we can put together. Put together a retirement plan based on your objectives, not mine. It's your money. And we want to see you be able to keep that money and enjoy and have a happy and a safe, secure retirement. So let's jump into that and get this show started. Well, let's go right into let's key up that music, please. Mr. Jim, my producer, let's key up the financial wisdom quote of the week music.

Speaker3:
And now for some financial wisdom. It's time for the quote of the week.

Speaker2:
And the financial wisdom quote of the week. Do not be embarrassed by your failures. Learn from them and start again. That's great. That is given to us by Mr. Richard Branson. Again, do not be embarrassed by your failures. Learn from them and start again. So Mr. Branson is an entrepreneur. This magnet known for his daring ventures in various industries. He was born in 1950. He is the founder of the Virgin Group, which includes over 400 companies spanning from music Airlines, Face Travel, so he is celebrated for his adventurous spirit, philanthropic efforts and his significant contributions to the world of innovation. So, Mr. Richard Branson has given us the financial wisdom. Quote of the week. Thank you so much, Mr. Branson. All right, public service announcements. Let's get these out of the way, folks. I'm going to talk about this over the next few shows. Uh, because AEP is something that a lot of you that listen to the show should be aware of. If you have Medicare, could be Medicare Advantage, could be just Medicare Part A, B could be prescription drug plan. It could be a Medicare supplement plan. So I want to do this to let everybody know that you can make a change if you want to.

Speaker2:
Right now when you're listening to this show, okay, AEP, which is for the Medicare Advantage. And that stands for annual enrollment period. And it started October 15th and it will run through December 7th this year. And that allows you if you want to, you can switch from one Medicare Advantage plan back to original Medicare if you so choose. Or you can switch from original Medicare to a Medicare Advantage plan. Or if you have a Medicare Advantage plan and you want to change that to a another Medicare Advantage plan, you can do that during AEP. And if you have a. Drug plan. Maybe your prescriptions have changed this year. Maybe your pharmacy has gone out of business, whatever it happens to be, if you need to change your prescription drug plan, you can do that. Switch that to a different standalone prescription drug plan. All right. Now what happens beginning January 1st? Well, that means we run into what's called Oep open enrollment period. And during open enrollment period that begins on January 1st, 2024 and runs through March 31st, 2024. Now, you can only make changes during Oep, folks if you made a change during oep. So if you did not just to your current plans during IEP, you can't go into January 1st, 2024 and say, oh, I want to change my Medicare Advantage plan.

Speaker2:
If you didn't make that change during AEP, you can't do that during Oep. All right. So you cannot switch your plans during Oep if you didn't make a change during AEP. Hope you understand. Unless of course, you qualify for a chronic plan or a dual dual plan, dual eligible plan. So you can switch back from, uh, if you made a change during your Medicare advantage and you find out during between January 1st and March 31st, you want to change back, you can do that. Uh, you can switch from original Medicare to a Medicare Advantage plan, as long as I feel like that should be done during AEP. But anyway, so that should tell you what you can and cannot do during AEP. And if you have made a change to your prescription drug plans at the end of 2023 and you want to make that change, you can go back to a different prescription drug plan if you are in original Medicare. So anyway, folks, we're going to be right back. Thanks for listening. Your American Retirement 101.1 FM. The answer.

Buddy, you're a boy. Make a big noise playing in the street. Gonna be a big man someday. You got mud.

Speaker4:
On your face, you big.

Speaker2:
Disgrace. Visit your American retirement. Com to schedule a free consultation with Randy today. And now.

Speaker5:
Back to the show.

Speaker2:
All right. Welcome back to your American retirement on 101.1 FM. The answer where little Rock comes to talk. So don't forget to check us out on our YouTube page, visit youtube.com and search your American retirement and look for my smiling face. You'll know you're in the right spot. All right, so again, folks, that was a little what you can and cannot do during EP. And a lot of people say, well, Randy, I listen to the show last week and I heard the same thing. That's right. I believe in repetition. You learn from hearing it over and over, or at least I do. But there's a lot of folks that may not have listened to the last couple of shows, and they're just joining in today, and I want them to understand. And because I get questions all the time, you know, why am I seeing so many commercials on TV? Or why am I getting phone calls? Or why am I getting all these Medicare Advantage and all this information about Medicare in the mail right now? Good question. That's because you're in a EP and I want you to understand what it's all about and what you can do and what you cannot do. And I didn't cover all of that. It would take too much time. We'll do that individually if you want to, because I like to spend a lot of time helping my clients understand exactly what Medicare is all about.

Speaker2:
Part A, part B, what Medicare Advantage is all about, what prescription drug plans are all about, and what Medicare supplement plans are all about. Okay, because we want you to make a wise decision because it's your plan, not mine. All right. So you got to reevaluate your Medicare plan each year, and you will likely find that you can save money on some of your Medicare expenses. So a lot of retirees do a Medicare coverage check every year. That's why I believe that you should have a local agent. I'll raise my hand. You need to have a local agent that you can work with that you can see face to face, eyeball to eyeball, sit across the table and ask questions, because you may have an opportunity to save some extra money with new plans that are coming into the area, or prescription drug plans. If you have a standalone prescription drug plan, maybe that plan doesn't cover everything that you need and you need to make that switch. All right. But I got to say this. Please be aware that there are scams out there that you need to be aware of during this year's Medicare AEP. And I'm not saying this to scare anybody, so please don't take it wrong. I'll do this to educate you. Okay? Beware of unsolicited contacts. Be cautious of unsolicited phone calls, emails, door to door visits, offering Medicare, excuse me, related services. So, folks, if, uh, Randy Sams comes to your door.

Speaker2:
Uninvited. That's unsolicited, and I can't do that. I wouldn't do that, but I'm just using myself as an example. So if I were to pull up into a neighborhood in little Rock or Benton or Bryant or wherever it might be Conway and just decide to go knocking on doors. And as someone comes to answer the door, give them my business card and say, hey, would you like to talk about Medicare Advantage? Folks? I can't do that. If you haven't invited me to your house for an appointment, that's prohibited activity. Okay. Phone calls. I know that you see advertisements after advertisement after advertisement on the TV about Medicare Advantage, about, hey, we're going to save you money. Are you in this area? We're going to give you money back. Just call this toll free number, folks. That's called bait. They want you to make that phone call to that toll free number because you got to insta. You got to make that phone call to them. They can't call you. And then they're going to try to get you to switch your plans, which may not always be in your advantage. And I will tell you, I personally do not believe in that because my question to you is, do you know who that person is you're talking to on the other end of the phone? What's the possibility that if you have an issue with the plan that you took with that person over the telephone, that you're going to ever be able to talk to that person again? Okay, I'm a big believer in working with an independent agent or an independent agency.

Speaker2:
Work with someone that understands Medicare, work with someone that understands Medicare Advantage, Medicare supplement, and prescription drug plans. Work with your local agent. I'd love to be your Medicare Advantage agent or your Medicare supplement agent, I really would. But there's plenty of us out there. But I just don't understand why someone would answer. See something on the television and they call a toll free number and get talked out of their current plan. Because they were told, oh, there's going to be a much better plan. But after it's all said and done, guess what? It's not a good plan. That's why you have to remember that if you got talked into switching your plan in AEP, and then you find out January 1st next year or February 1st next year, that, hey, this isn't a plan that I thought it was during Oep you can switch back, you can change that plan. All right. So it's kind of a safeguard for you, but I just don't understand why anybody would do that over the telephone. But number this is very important. Keep your Medicare card secure and avoid sharing your Medicare number. So I again I ask questions all the time. Why would you give your Medicare card number out over the telephone? I'm not saying that the people who are taking it from me are going to do anything nefarious with it, but it's yours.

Speaker2:
It's not theirs. And that's why I believe in working with local agents, because you're there with them face to face. If there's an issue with the plan, you can take care of that issue, right? With that agent, that local agent. So that takes care of AEP. Let's run into very quickly. Let's look at RMDs. Folks. If you are 73, if you turn 73 in 2023, then you are eligible. You are required to take a distribution from your qualified plans, your 401 KS, your IRAs, anything that's been taxed, deferred. If you've been growing that plan tax deferred and you haven't been taking income out of it or taking any withdrawals out of it, then at age 73, starting in January 1st, 2023, that age jumped up from 72 to 73. You are required to take an RMD, so as we approach the end of the year, it's important to remember that the deadline for taking your required minimum distributions, or RMD, is fast approaching. That is December 31st, so missing the deadline could result in significant penalties. So be sure to mark your calendars and prioritize this important financial task before it's too late. Okay, so an RMD from employer based retirement plans and traditional retirement accounts IRAs will be due December 31st. For most people who turned 73 this year, or if you're older than 73, you probably have been already taking RMDs.

Speaker2:
But don't forget those distributions are taxable. That's why they want you to take it, folks. It'd be nice if Uncle Sam would just let us start a 401 K when we're 25 years old, and continue to just allow us to make contributions or allow us to allow that 401 K to just grow tax deferred forever and ever and ever. And whenever we pass away, pass it on to our spouse or pass it on to our children. It doesn't happen that way. So that's what happens. So they put an age before it started out at 70.5, then it moved up to 72. And again because of the secure act it moved up to 73 January 1st 2023. Okay, so there's one exception. If you turned 73 years old this year, 2023, you have until April 1st of 2024 to take your RMD and pay the taxes on it. Does that make sense? So if you turned 73 in July of 2023, if you don't want to take your RMD this year before December 31st, you have to take your 2023 RMD by April 1st of 2024. Okay, so you say, well, why wouldn't I just postpone it? Well, because here's what happens. If you delay taking your 2023 RMD until April 1st of 2024, guess what 2024 you have an RMD that's also going to be due, and it's got to be paid by December 31st, 2024.

Speaker2:
You can't delay it. So that means that in 2024, if you delay your 2023 RMD this year until next year, you're going to be taking two RMDs. Both of them are going to be taxable okay, so it's your decision. But I just want to make you aware of it. So you'll also have to take that RMD in 2024 if you don't take it for 2023. All right. So that means it's you're going to be making two RMDs in one year, which could possibly, possibly push you into a higher tax bracket. So you want to say goodbye to RMDs and divest the Aria or the IRS from your retirement plan so we can help you with what we call a Roth conversion. So that's tax free withdrawals. Roth IRA contributions are made with after tax dollars. So all withdrawals, including earnings or tax free in retirement flexibility. Unlike traditional IRAs, you're not required to take minimum distributions. Ever. Did you hear that because you've already paid your taxes? Tax diversity. Roth conversions provides you the ability to diversify your tax liabilities, allowing you to have access to both tax free and taxable income sources in retirement. All right, so two forms of tax free investments or tax free income. One is Roth IRAs. And number two is life insurance okay. So if you want to take advantage of that. Give us a call (866) 990-7664 or go to the website Your American Retirement and ask for your free, no obligation consultation to see how one of these tax free strategies might help your retirement.

Speaker2:
So you again, you can call us on our toll free number (866) 990-7664 or go to the website your American retirement.com. All right. You know. A lot of people have looked at retirement age as being 65. So a lot of Americans are not ready for retirement. And that's why we do this show. While we love doing this show, you know, we've talked about today getting you prepared for retirement. We've talked about Eaps, the AEP, the Oep that helps you with your health coverage, your health insurance. Because at some point in time, folks, you know, we haven't spoken about long term care in a while, so we'll probably spend some time on one of the show's upcoming shows talking about long term care. Do you have it? Most people don't. Did you know that 72% of the people that are 65 today, 72% of those people that are 65 today will need some type of long term care, but the majority of you do not have it. So here we go. Uh, thank you for listening so far. I want you to stay tuned and come right back, because we're going to find out why people that are turning 65 are not ready for retirement. You're listening to your American retirement will be right back.

Speaker5:
Are you interested in ways to protect and grow your hard earned money? Your American retirement is here to help.

I'm riding in your car. You turn on the radio. You're pulling me close.

Speaker5:
It's that time of year again. Medicare's annual enrollment period is here for decades, Randy Sams, the host of Your American Retirement, has helped the people of Arkansas navigate the complexities of their choices in retirement. Stop guessing when it comes to something as important as your health and your wealth. Get the answers you need by calling Randy now at (866) 990-7664. That's (866) 990-7664. Learn more at your American retirement.

Speaker6:
Clash of Speed and Iron are coming to a streaming service near you this fall. I'm Jim Terubok with the Retirement Radio Network powered by Amara Life. This November, streaming giant Netflix will stream its first ever live sporting event, the Netflix Cup, a golfing competition featuring Formula One racers and PGA tour golfers. Josh Shafer of Yahoo! Finance explains how this new venture makes sense for Netflix.

Speaker7:
This is happening the week that F1 is in Las Vegas and this event is happening in Las Vegas. So for fans to be able to engage with their favorite drive to survive characters, I think is something to think about here.

Speaker6:
The golfing exhibition will showcase two star studded rosters with names including Rickie Fowler and Lando Norris, who will play a professional eight hole course, with the two top teams advancing to the final hole to determine the winner of the inaugural Netflix Cup title. Meanwhile, the Netflix sports catalog that features hit series such as quarterback continues its upward growth with this new live event and will be charging up to $2 million to secure advertising space. Any advertiser that wants in for the crossover golf event will have to commit to spending $2 million on Netflix ad supported tier. So what does this mean for the live sports future of Netflix? The streaming service has been very timid about producing live sports content, but according to The Wall Street Journal, live boxing could be shown on the platform in the near future. And with the NBA television rights deal up for bidding next year, analysts wonder if Netflix could jump further into the live sports pool in the future for the retirement radio network powered by Amara Life. I'm Jim Terebovlia.

Speaker5:
Thanks for listening to Your American Retirement. If you like what you're hearing, subscribe to our YouTube channel to watch videos from this program and other recent episodes.

Speaker2:
Hey, thanks for joining us on this week's edition of Your American Retirement. Be sure to check out the podcast version of the show on Apple, Google, Spotify, or wherever you get your podcasts. Again, thank you for joining us this Saturday morning. Okay, millions of Americans will soon turn 65, and they are not ready for retirement, folks. Last week's show. We did a little segment. Uh, well, I talked about what's known as peak 65. Peak 65. And I'm not going to spend a lot of time on this, but peak 65 votes in 2024. There will be more baby boomers turning 65 than ever before. So today, when you're listening to this show. As a baby boomer. There are 10,000 baby boomers turning 65 every day in 2024. That number jumps up to 12,000. So beginning in 2024, there's going to be 12,000 baby boomers turning 65. That's why they call it peak 65, because that's the most that it's ever been, and it's the most that'll ever be after that time. But millions of Americans who will soon be turning 65, they are not ready for retirement. Let's find out why Americans close to retirement or recently retire are still not prepared. That's what that's what we're in business for. According to a new survey from the Alliance for Lifetime Income, the Alley is a nonprofit consumer organization that educates Americans on how to protect their retirement.

Speaker2:
That's crazy that Americans close to retirement or recently retired are not really prepared. They're still not prepared. So long gone are the times when most Americans could rely on a pension to provide an additional stream of retirement income. That's left many pre-retirees and retirees at risk of running out of money in the coming decade. So, folks, you know the old story. My parents. A lot of grandparents in the words folks used to go to work when they were in, some in their teens, some in their 20s, and they would work at that job for the next 35, 40 years or longer. And then when they retired, they had a pension, okay, a defined benefit plan that was waiting for them that the company put together and invested in for the benefit of their employees. Unfortunately, over the years. The majority of employers today. If I say 85%, it's a little bit over 85%. So 85% of employers today do not offer a pension plan to their employees. So what happened to that, Randy? Well, if it now has switched the burden for retirement planning for retirement funding has now switched from the employer to you, the employee. It's gone from a defined benefit to a defined contribution plan, i.e. the 401 K, 403 b IRAs. So now it's on your back. Okay, so a lot of folks aren't familiar or are not prepared for retirement.

Speaker2:
And here's what the Alliance for Lifetime Income basically they did a survey and this is what they found. 51%, so more than half of consumers between the ages of 45 and 75 feel they do not have enough retirement money to last their whole lifetime. 32%, that's nearly a third, are not confident they will have enough money in retirement to safely cover their basic monthly expenses. Folks, that that hurts my heart when I see that because that's what we do. That's what our focus is. That's what our passion is, is to make sure that you understand what you're going to incur, what your what will occur during your retirement, what financial risk, more and more than likely are going to arise in your retirement. We want you to be prepared. We want you to be educated, and we want to be able to show you the products and educate you on what you need to do to be prepared. I don't want you to be in that 32%. Know that you're not confident you're going to have enough money in retirement to safely cover your basic monthly expense. All right, 44% are retired currently or retired previously and have gone back to work. 44% that are retired now or retired previously. And they've gone back to work. You know why? Sometimes it's because they want to. But a lot of times when I'm talking to folks because something happened right before you got ready to retire, the market dropped your 401 K balance.

Speaker2:
Your your retirement balance went down. You went ahead and retired, so you had less money in your retirement fund, your retirement account. And so now, just to make sure that you can have enough money to make ends meet, that you meet those basic monthly, monthly expenses. A lot of folks have had to go back to work. If you want to be a Walmart door greeter because you feel like you want to and you want to have that interaction with other people, that's great. But a lot of people today, because of the financial situations that they find themselves in, they were not prepared financially for retirement. They're having to go be that Walmart door greeter or whatever job you may choose because of a half two situation, not a want to. Okay, so there's growing demand for protection and annuities, folks. You know, I preach annuities. I believe in them. I've got three of them myself. So I believe in annuities and what they can do for you and your family. I believe in guarantees. It's safe money, not risky money. So the survey also reveals how consumers want as much as 80% of their retirement savings to be invested in safer investments. Folks, those of you who are listening, if you're married, if you're if you're female.

Speaker2:
I wish I would have been able to take a survey or whatever, but I one of the things that I always come across when I'm meeting with a husband and a wife, the wife is wanting to make sure they are looking for security. They want to make sure that they're not going to lose their money. So they're not they're more apt to to go with a plan that gives them a guaranteed income, no matter what happens to the stock market, than they are to put it into a risky plan. All right. But that's where I let the husband and wife have the debate. But I'm telling you, the majority of the wives that I meet with, even with their husband, they're they will tell me that they're looking for security. They want their retirement funds to be secured, to be safe and not risky where they can, where they might lose some of it, or a portion of it, or all of it, possibly so. Individuals protected by a pension. Or an annuity have a significantly more positive outlook on their retirement prospects, according to the survey. I say it all the time. I'm not getting phone calls from the folks that we have done annuities for. We have them set up on guaranteed income, or it may be a growth annuity, or it could be a guaranteed interest rate annuity.

Speaker2:
Amiga. I've not received any phone calls from any of those clients that have been upset because we put them in that. Matter of fact, the phone calls I get, most of them are very happy that they made that choice and we were able to put them into the right program, the right plan for them and their family also. Consumer demand for annuities has skyrocketed to an all time high amid concerns about unprecedented market volatility. And falling retirement investments, according to the Alliance of Lifetime Income. All right. So what do we do to try to help our clients? We want to be able to build a safe retirement plan with what we look at fixed indexed annuities. All right. What is a fixed indexed annuity. Good question. If I was. Our insurance contracts that provide a guaranteed income stream for your retirement. So if we do an indexed annuity, we'd set it up for income. It's guaranteed income. We can also do an indexed annuity. For growth. For protection, you can use an indexed annuity that allows you to have a certain percentage as far as a free withdrawal amount, and you can use that as a play check. I've got clients that that's what they do. They're one of the lucky ones that have pensions and they have Social Security. So they've got a a good income stream coming in off of that.

Speaker2:
But they also like to travel or they like to do things for their kids or grandkids. So they put money into the indexed annuity. They're not going to lose anything. Remember, in an indexed annuity, zero is your hero. So you can't lose anything. And from time to time they'll make withdrawals to go take those trips, to take those cruises or whatever it happens to be, or spend that money on their kids and grandkids. Okay, so this is an alternative to bank CDs and traditional bonds and provide a way for investors to protect their retirement savings from market volatility. And folks, that's what I say. We have to address the risk that you are going to incur that you will see during your retirement. And one of those is market volatility. That's why it goes up. That's why it goes down. It doesn't always go up. And sometimes those downs are a whole lot more dramatic than the goings ups. Okay. So we got to provide protection from market downturns while providing potential for growth. And that's what the indexed annuity will do. So some of the main benefits for the indexed annuity protection from market volatility. So the indexed annuity provides protection market volatility. Because the annuity is linked to the performance of an underlying stock market index, the income is not directly affected by short term market fluctuations, so this makes them an attractive option for investors who are looking for a steady and reliable income stream.

Speaker2:
So, folks, your funds in an indexed annuity, they're not invested directly in the index you're getting a participation rate could be 30%, could be 50%, could be 60%. But that's why the protection is there. If your money was directly invested in the index, if that index went down, so would your account. But with an indexed annuity you're getting a participation rate. So if that index happens to go -0 is your hero okay. Tax deferred growth. This means that any earnings of the annuity are not subject to taxes until withdrawals are made. So a lot of people like that because it's tax deferred growth lifetime income stream. Don't worry about breaking your budget and enjoy retirement income that you can count on and never outlive. That's the main reason that we like to do the indexed annuity is because the income stream folks in retirement, I've yet to meet anybody that's getting close to retirement or that is in retirement that does not need income. You retire on income, not assets, because assets can be lost. And if your income is being generated strictly from those assets, then your income could be lost also because of the assets being in the stock market. All right. So. My opinion as a financial professional. Okay. Every time a professional fixed indexed annuities are suitable for up to 70% of your portfolio, do the rule of 100.

Speaker2:
If you're 60 years old, take 60 from 100 at least 40. You should have 60% of your retirement funds in safe investment, safe money products, annuities, and 40% in equities or more risky investments. 70 over 30 work the same way. Typically, our clients are using fees in a 20 to 50% portion of their retirement savings, while the rest is allocated to smart risk investments to provide further opportunity for additional growth. Okay, so our clients are using fees for anywhere from 20 to 50% portion of their retirement savings. And that's something that we would that we would work with you and figure out what's going to be the best amount for you all. Okay. So the fees are going to offer you safety. They're going to offer you growth and they're going to offer you income. It's the best of all worlds as far as I'm concerned. So folks listen, as I gave an example last week on a gentleman that called, I've got another gentleman that that has been listening to us for a while, and we put together a plan that I want to talk to you about in the next segment. I call this my combo split annuity concept. So please come right back. You're listening to your American Retirement Home, 101.1 FM. The answer.

By the look in my.

Speaker1:
Fixed annuities, including multiyear guaranteed rate annuities, are not designed for short term investments and may be subject to restrictions, fees and surrender charges as described in the annuity contract. Guarantees are backed by the financial strength and claims paying ability of the issuer.

Speaker5:
Welcome back to your American retirement. Here's Randy Sams.

Speaker2:
Are you listening to your American retirement? Join us every Saturday morning at 10 a.m., right here on 101.1 FM. The answer where little Rock comes to talking. Again, folks, I want to thank you for joining us. We love hearing from and helping our listeners and all of those folks that are listening today, this morning that have left me a great comments, critiques, ideas on upcoming shows, what it is that concerns you about retirement. You know, you can give us a call (866) 990-7664. Leave us your information. We'll be glad to get back in contact with you and have a little discussion and find out what it is that we can do for you. Again, there's no obligation on your part. If we can't do something that puts you in a better situation or makes you comfortable about about to go into retirement, then I'm not going to ask you to do business, folks. I want to earn your business. I want to earn your trust. Something must be happening. That's right. Because we've been doing this for 38 years, and there's not a lot of folks out there. And I'm not trying to toot my own horn, but there's not a lot of folks out there that have been in this industry for 38 years. I enjoy doing what I do, helping people again retire what prepare for a safe and a secure retirement, not a risky retirement. So folks, talking about that, I left off the last segment talking about annuities.

Speaker2:
And I want to give you an example of what we recently were able to do for a gentleman and his wife. They're local. They listen to the show. And they gave us a call and we were able to put together. What I feel like is a is a great concept, especially now because folks, as you know, interest rates are high today. Now, I don't know what they're going to be next week. I don't know what they're going to be next month. I can't tell you what they're going to be in 2024 or 2025. All I know is today that interest rates are high. If you've ever tried to, if you're trying to do a mortgage or you're trying to do a car loan, or if you go to the bank and you've got some extra cash and you want to put it into those certificates of depression, I mean, certificates of deposit CDs, right? You're getting a much better offer on your CD rates today than you were last year or two years ago or three years ago. I'm renewing annuities today that we're getting 2% offer from two years ago, three years ago. And that was a great offer because CDs were paying, what, less than a half a percent. But today we're taking that same money that we invested 2 or 3 years ago and putting that into a new mega multi year guaranteed annuity.

Speaker2:
And those rates are up to five and a half over 6%. But let's talk about this example folks. So what I call this is my combo split annuity concept combo split annuity concept okay here's the example. This is what we were able to do. So we have a gentleman that called me. We went and met with he and his wife and they had $500,000. Now folks that money was nonqualified funds. So that's money that they had in a savings account that they had accumulated. And I'm not saying that you got to have $500,000 for me to work with you. I'm just using this as an example. This is a real life example. This couple had $500,000, actually had more. But that's what we were working with in Nonqualified funds. That means that those funds had been taxed. They were paying taxes on those funds. So we took $500,000. And what they were wanting to do is they wanted to be able to generate an income for the next seven years and then be able to take, hopefully have the same amount of money that they invested, the $500,000 to be able to look at and see in seven years what's available for them to put that $500,000 into. Okay, so here's what we did. Comes in okay. So we took the $500,000. And I ran all kinds of illustrations and proposals and all of this. So the split is going to be between a mega Meiga, which is a multi year guaranteed annuity, and a Spia Spia single premium immediate annuity.

Speaker2:
All right. So here's what we did. We took $329 and three 300 $329,254. Let me say that again $329,254. And we put that into a seven year mega with a guaranteed rate of 6.15%. All right. That's guaranteed for seven years. And we're going to leave that money in there and just let it accumulate over the next seven years at 6.15% guaranteed interest rate. All right. So, Randy, what do we do with the other one. You said you're wanting to generate some income. So we took $170,746. And I know these are odd amounts, but. This is what got them to their target. And we were able to work that split out. So $170,746 went into a spia single premium immediate annuity, which means that when that money was invested, it began to generate income immediately. For seven years, it's a seven year spia. And so what did they get as far as income for their $170,000? Good question. That $170,000 generated a guaranteed $2,393.81 per month, $2,393.81 guaranteed per month. Both of these carriers that we used were A+ rated carriers. Now, if you do the math into the Spia, we put $170,000, just a little bit over 170,000. It generated 200 or $2393.81 per month. Multiply that by 84 months, which is the seven year period, and that generated guaranteed income over that seven year period will be $201,000.

Speaker2:
All right. So they invested 170,000 over the seven year period. They've got a monthly income guaranteed. And at the end of seven years that amount equals $201,000 from their initial investment of 170,000. I think that's pretty good. But that's the income from the Spia and that is guaranteed. Now, the exciting part is that we look at this picture seven years down the road and remember what their original investment was, $500,000, but we took 329,000 of that money, and we put that into a seven year Miga guaranteed annuity at 6.15% compounded interest over seven years. So guess what? That grows to that $329,254 at 6.15% compound interest for seven years grows to $500,001. Did you get that? So we took 500,000. We did a combo. We did a split. We put some of the money into a spia, which generated an immediate income for those clients. Over the next seven years, they're guaranteed that income. And then the other money we put into the seven year guaranteed annuity fixed rate annuity at 6.15%. And that money that was invested in the Miga is guaranteed to grow to $500,001 at the end of seven years. And here's what's great about this feature. This annuity that we're looking at. It's fully liquid at seven years. No surrender charges. The surrender charges during the original seven years do not apply going afterwards. So they could leave the money in there if they wanted to, or they've got their original $500,000 at the end of seven years to make a decision.

Speaker2:
Do we want to leave it in there? Do we want to take an income? Do we want to do the same thing again with the 500,000? That's going to depend on what the interest rates are. But folks take advantage today on what the interest rates are. What are the interest rate? They're high today. I can't tell you what they're going to be next week. Like I said earlier, I know that the ten year Treasury, I believe it was somewhere about a little bit about 5% for the ten year Treasury. I know this year it dropped down to about 4.5, maybe 4.56. So if the ten year Treasury drops down, then the interest rates that we're being offered for these multi year annuities will probably decrease also. So that's why we do this. You got a tax exclusion and you got the deferred benefit okay. Because remember this was qualified. This was non qualified funds. So the funds that she get that they got from the Spia there's an exclusion ratio on there. So not all of that was taxable. You got even payments guaranteed income for the next seven years. You got diversification because we diversified that 500,000 into two different companies. And you've got the extra liquidity because the seven year Miga also gave this clients, these clients the opportunity to take out 10% of their account value if they wanted to, or they could take the interest payments that they accumulated, but they didn't want to do that, that Spia took care of all the income that they needed additional for the next seven years.

Speaker2:
They were just excited that, hey, we invested 500,000. We got over the next seven years, we're guaranteed to have $200,000 in income guaranteed. And at the end of seven years, our original investment of 500,000 is still sitting there waiting for us. All right. To them, it was a win win situation and I had to agree. But I'd love to do the same thing for you guys if you'll give us a call (866) 990-7664 or go to the website Your American retirement.com. Just leave me a message, leave me your contact information and say, hey Randy, I listen to your show this Saturday morning. I like that concept of that split annuity, the combo annuity. Would you give me a call and let's see what we might be able to put together for me and my spouse. Love to do that for you folks, okay. Because I believe that annuities can be a valuable part of a diversified portfolio. You. I call it a personal pension or an annuity may be a good choice. So if your Social Security isn't enough to cover your basic expenses, if you're concerned, you may outlive your savings. In other words, if you're concerned that your blood pressure.

Speaker2:
Or your retirement account will hit zero before your blood pressure does. You're concerned that you may outlive your savings. If you want to reduce risk and protect part of your retirement savings, you want to reduce and delete fees on part of your portfolio. That's why we need to get together. And you need to give us a call. Because, folks, we love doing what we're doing. We love working with our clients, and we know there are some issues that a lot of you don't understand. That's what we do. We take our time. We spend time with you as clients, as listeners, again, take advantage of the free, no obligation consultation. You know how to get in contact with me. (866) 990-7664 or go to the website Your American retirement.com. Please leave me your information. I'd love to sit down with you. Just introduce myself to you, have a conversation with you over the telephone, and then from there, let's see what we can put together for you and your spouse. So folks, I want to thank you for listening to your American retirement this Saturday morning with me. If you've missed any part of today's show, go back in the podcast archives on Apple, Google, Spotify, or whichever platform you get podcasts from. I want you to go out. Have the have a fantastic rest of your Saturday. Have a great week. God bless Go Hogs and we'll talk to you next weekend.

Speaker5:
Thanks for listening to your American retirement. You deserve to work with licensed financial insurance experts who can offer sound strategies for protecting and growing your hard earned money. To schedule your free, no obligation consultation, visit your American retirement.com today. That's your American retirement.com, not affiliated with the United States government. Randy Sams does not offer tax, legal or investment advice. Consult with your tax advisor or attorney regarding specific situations. Opinions expressed are subject to change without notice. These opinions are not intended as investment advice, nor do they 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 a specific result. All copyrights and trademarks are the property of their respective owners. Amara Life 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 of the results obtained from the use of this information.

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