How to Set-up a Personal Pension and Live Comfortably During Retirement

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

Producer:
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.

Producer:
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.

Randy Sams:
Hey, good morning. Central Arkansas would like to welcome you this Saturday morning to Your American Retirement on 101.1 FM. The Answer We're Little Rock comes to talk. My name is Randy Sams. I am your host for the program. I want to tell you how much I appreciate the listeners, people that are joining us today. I've gotten a lot of good feedback from folks. Let me tell you a little bit about what we do at SMMG Financial. That's the company that that I have. I've had it now for nine years at SMMG Financial. Your retirement, Your American Retirement. Basically, we are focused on addressing major financial issues facing retirees and pre-retirees in America today by helping people understand and prepare for a secure retirement, not a risky retirement. So, folks, people ask me all the time, you know, Randy, what do you do? There's just kind of a little snapshot of what I do, what we do, what our mission is, is to get you, whether you're in retirement or whether you're getting close to retirement, gets you prepared and help you understand what your options are, what products are available for you. So you'll go in that you'll have a secure retirement, not a risky retirement. Hey, I want to give a shout out to all the listeners today. Again, today is Saturday. Happy Easter weekend. Let me give you this piece of advice. He is risen. You know, folks, I do dinner seminars. And one of the things that that I speak about, you know, I focus and specialize in retirement planning, but this being Easter weekend.

Randy Sams:
It would not do me any favors if I didn't tell you that the best retirement plan, the eternal retirement plan has been offered by our Heavenly Father through His Son, Jesus Christ. And I'll just tell you this. I can do retirement planning for you here. Put together a plan. But Almighty God has put together the best retirement plan, the eternal retirement plan for every one of us that will take that opportunity that will receive him. But today is the day before Easter. And let me tell you, he is risen. But hey, let's get on with the show again. I want to thank all my listeners. Folks, we have a podcast. Wherever you enjoy listening to podcasts, YouTube, Spotify, wherever that may be, if you will go and look up your retirement, YourAmericanRetirement.com. Again, YourAmericanRetirement.com. We don't play the whole show though. So our podcast is not the whole radio show that you're going to listen to. We have anywhere from 2 to 3 to four minute snippets of what we feel like are some of the most important segments of the show. Just to kind of give you, you know, kind of pique your interest to get you to go to the website, the website, YourAmericanRetirement.com, or you can also call me at 8669907664 Is the toll free or direct number (501) 249-2343. So please check out our YouTube channel, subscribe. Give us a thumbs up.

Randy Sams:
Help us out there. You know, again, we have a video highlights and special content. So just again search YourAmericanRetirement.com. So please reach out to us. We absolutely love reading and hearing your messages. We'd be happy to Answer any of your questions on the show that you leave as far as comments and set up a complimentary consultation with you, you and your spouse. So listen to this. So after last week's show, you know, I get several inquiries. I get several suggestions from folks that, you know, you have you have concerns about retirement. What is it when you lay your head down on the pillow that concerns you? Is it is it your retirement income? Is it your expenses? Is it how to make sure that you don't run out of money, whatever it might be? Is it long term care? Is it Medicare? Is it Social Security? And we could just keep going on and listing and listing and listing. But I got an email from a listener. It was a young lady that was here in Arkansas, and she was listening to the show last Saturday morning. And this young lady lives in Missouri, so how about that? She was in Little Rock. She listened to the show on 101.1 FM, the Answer. And she was very intrigued and very interested in some of the subjects that we were talking about on last week's show. So she sent me a little email and said, Hey, I'd like to set up that free consultation with me and my husband.

Randy Sams:
So I spoke with her, as a matter of fact, this morning and sent her some information for her and her husband to complete and kind of a financial data information form that I have kind of gives me kind of a roadmap of where you guys are at financially, what assets you may have and what we have to work with and some of your objectives. But I've sent that to her. She's going to fill that out and get it back to me. And guess what? Then I'm going to contact her and we're going to do first contact will be over the telephone, kind of going over what what her information is. But I just wanted to kind of give you that. It's really good. I mean, I think it's fantastic. We've gotten a lot of good suggestions from our listeners as to what some of the show content you'd like to listen to, some of the subjects that are of concern to you. But I really love it when we get folks that are just traveling through Turn on 101.1 FM, the Answer at the perfect time to listen to Your American Retirement. And the subject matter that we speak of was of interest to this young lady and to many others that have reached out and touched base with me. So we love to be able to have those consultations. But hey, look, I've got another free offer for our listeners.

Randy Sams:
If you get in touch with me, you can receive a copy of our report on the new Secure Act 2.0 and what it means for your retirement. So the free report is yours today. When you get in touch with me on the website, YourAmericanRetirement.com or you call me on our toll free number (866) 990-7664. Again go to the website YourAmericanRetirement.com or give me a call on the toll free number (866) 990-7664. And we'll send you a copy of the new secure Act 2.0 and what it means for your retirement. And we have a bonus offer. If you get in contact with us, you will also receive our report called Too Big to Fail. When banks collapse and what it means for consumers and retirees. Really good report, especially with all the information that we've seen, everything that has occurred over the past, you know, 3 or 4 weeks. Again, if you get in contact with us, you'll get two reports the Secure Act 2.0 and what it means for your retirement. And also too big to fail when banks collapse and what it means for consumers and retirees. So give me a call. (866) 990-7664. Or go to YourAmericanRetirement.com and leave us your information. Tell us that you'd like to have those free reports and we'll get them in the mail to you or we'll email them to you, whichever is easiest for you. So anyway, folks, again, thank you for listening. You don't know what it means to me to have people that that that call just to leave, you know, give me a thumbs up kind of tell me that they enjoy listening to the to the show that.

Randy Sams:
Our train of thought. What we look at as far as preparing folks for retirement. Or getting people in retirement back on the right track is exactly what you want to listen to. So again, thank you for listening. We we really appreciate it. Uh, today's show a little bit about today's show. We're going to do the quote of the week. We're going to talk about nine ways to live comfortably during retirement. And a little bit of information about why you should want to meet with an advisor such as myself. And then if we have time, we're going to talk about we're going to do a little right or wrong, maybe a couple of problem solvers. I also have a little parable. You know, we we're here we are on Easter weekend. And we talk about Jesus. And if you read the Word of God, if you read the Bible, you know that Jesus spoke in parables. How a little parable that's written by another person that I follow quite, quite often, and in one of the segments, maybe two of the segments, we'll go over that parable and kind of give you some food for thought as far as retirement and why we do what we do at Qmg Financial. So folks, the financial wisdom quote of the week.

Producer:
And now wholesome financial wisdom, it's time for the quote of the week.

Randy Sams:
Comes from Mr. Warren Buffett. Never test the depth of the river with both your feet. Never test the depth of the river with both of your feet. That is brought to us by Mr. Warren Buffett. Mr. Warren Edward Buffett, born in Omaha, Nebraska in 1930, is an American businessman. He's an American business icon. He's an investor. He's a philanthropist. He has a net worth. Get this $104 billion as of March 2023. Now, folks. So his net worth makes him the fifth richest man in the world. So again, financial wisdom by Mr. Warren Buffett never test the depth of the river with both your feet. Got a great example about that. I had a gentleman, he was from Tennessee, and we had some really good conversations and he was getting ready to retire and we started speaking about annuities. So his thought was, you know, man, I've heard so much about annuities. But after we spent a lot of time speaking, I gave him a lot of illustrations. He basically said, Randy, he said, when I was younger and I was about to jump into the swimming pool. He said, I never would jump into the swimming pool, you know, to see if the water was cold.

Randy Sams:
I never would just jump in there and see. He said. I'd always put like maybe one toe or maybe, you know, one foot in the water to kind of test the water to see if it was okay for me to jump in. So what he told me was this He had a certain amount in his 401. K. He said, I'm going to take a smaller amount and I'm going to put it into the annuity. So I'm going to test the water, put my little toe in it, and let's see how it is. Well, guess what? Since that time, which has been a couple of years ago, we've done a couple of annuities for him since then. So he took Mr. Warren's vice. Warren Buffett's vice. And he didn't jump in with both feet, but he tested the water out. But since he said, Hey, the water's fine, come on in. We've been able to ride a couple of more annuities for him. So, hey, listen, right after the break, I'm going to come back and ask those questions. All right. Again, Your American Retirement with Randy Sams on 101.1 FM. The Answer.

Producer:
Are you interested in ways to protect and grow your hard earned money, Your American Retirement is here to help. Here's Randy Sams.

Producer:
Visit YourAmericanRetirement.com to schedule a free consultation today. And now back to the show.

Randy Sams:
Hey, welcome back. You're listening to Your American Retirement on 101.1 FM. The Answer Where Little Rock comes to Talk. I am Randy Sams, president CEO of SMMG Financial. Thank you for joining us on today's show. We're going to continue. We're going to talk about nine ways to live comfortably during retirement, no matter how much you have or have not saved. All right. You write that down. Nine ways to live comfortably during retirement, no matter how much you have or have not saved. All right. Number one, maximize your final earning years and don't take Social Security until your full retirement age to receive 100% of the Social Security benefit you are owed. Don't settle for less by taking it too early. If possible. Even delay taking Social Security to age 70 to receive a 24% boost in your benefit. Folks, spend a little bit of time on this. One of the things that we are going to focus on if we have a consultation, remember the free consultation that we talk about. If we set that up, we're going to talk to you about Social Security. You're going to give us your objectives and we're going to be able to decide and put together a game plan. We're going to do a retirement income report for you and kind of let you decide, is it best for me to turn on income, my Social Security income at age 62, or should I wait to age 67? Or if you can, can I wait to age 70? Folks, this is where it comes in of a importance.

Randy Sams:
It's all about income. So the longer you can delay taking that Social Security payment. The better off you're going to be. In other words, your income, your Social Security retirement benefit is going to be higher at age 67 than it is at age 62. And remember, when you turn on that Social Security stream, you have a short window of opportunity to say, hey, I made a mistake. I don't want it now. Okay? But if you turn it on at 62 and you keep it on at 62, that amount that you receive is going to be for the rest of your life. And it can be anywhere from 25 to 30% less than what your full retirement benefit would be at age 67. Okay. Now, you may not say. Yeah, but Randy, that gives me five years of taking that Social Security at age 62. Yes, it does. But at some point in time, if you'd have waited to age 67, the additional amount that you will receive every month catches up and then goes ahead and now you're ahead of the ball game for the rest of your life. And then we can talk about age 70. As a personal example, I just met with a gentleman. If he waits to age 70 to turn on his Social Security, it adds an additional $1,000 a month to his Social Security benefit. Folks, that's 12,000 a year. All right. So after a certain age, say 78, 79 years of age, where he now breaks even and goes ahead, he's going to stay ahead that $1,000 a month for the rest of his life, even based on the full retirement age.

Randy Sams:
So that's why it's important for us to talk about Social Security, whether you turn it on now or whether you should wait for your full retirement age or if possible, let's put it together and build a Social Security bridge where you can wait to age 70. Number two, pay your house off or downsize and pay cash for your new smaller house and invest the difference. The happiest retirees that I meet with have paid off their mortgages and have guaranteed lifetime income. Did you hear that? You want to be happy. You want to have a hap hap Happy retirement. Pay off your mortgage. Get that debt off of your back and then set yourself up with a guaranteed lifetime income annuity. So how much guaranteed income do you currently have? That's one of the questions that we ask. Number three, bank. The money you save from having no mortgage payment any longer into a safe investment account. Making smart reinvestments in your future can pay off as you get older. Try to maximize and use catch up contributions to your advantage. All right. So any money that you get, that's called equity from your house. If you can use that to put it into some type of a safe investment account. To help pay off. You can set it up into a into a guaranteed income annuity. Starting at at a later date to help for and cover inflation.

Randy Sams:
But the ordinary contribution limit for an employer sponsored plan like a 401. K or a 403 B in 2023 is $22,500 per year. But if you're over 50. You can contribute an additional $7,500 annually for a total of $30,000. So folks, if you're working and your employer offers you a 401. K plan and they offer you a matching. Take advantage of it. But when you hit age 50, if you have. Income. If you have a positive income gap, in other words, you have money after you've paid all your bills and everything. Consider putting that money, additional money into that 401. K. Remember, if you're over age 50, you can put an additional $7,500 into that 401. K and you'd be surprised what that additional $7,500 will accumulate to over a five year, ten year, 15 year period. Okay. So number four, stick to the course and don't let emotions get in the way of your smart retirement plan. That's why we have to do annual reviews folks with our clients. We sit down. And we look and see how everything's going. Incomes looking great. Expenses are in, you know, in line. You guys are having a hap hap. Happy retirement. You've joined the country club. You're playing golf, you're playing pickleball, you're taking cruises, you're having a great time. That's what we want to do. But we got to stick to the course and we got to not let emotions, especially in this time that we're in today with the banks and economy and stock markets.

Randy Sams:
It's crazy. Okay. Number five, implement a Roth IRA conversion before age 73. This will help protect you from future tax increases and eliminate required minimum distributions from your retirement plan. Folks, I'm in the process of working with a client right now, and this is what we're about to set up. If you are over age 59.5, you can take advantage and you have a 401. K with your current employer. You can take advantage of what's called an inservice distribution. You can Google that in-service distribution, which means that you can take a portion or all of your 401. K balance and we can put that into an annuity. And what our objective is, is we're going to take that annuity and we're going to we're going to utilize that as a Roth conversion. All right. So we're going to put it into an annuity that will allow us to take 10% annually and put that into that Roth conversion. So instead of taking a huge amount, say, 3 or $400,000 out of your 401. K, having to pay that huge tax burden on 300, $400,000, we're going to take that 300 and 400,000, put it into an annuity. How do you eat an elephant one bite at a time. So every year we're going to take 10% out. You pay the taxes on that 10%. What's left over goes into that Roth conversion. We do that over a ten year period. That Roth conversion has continued to accumulate. And guess what? It now becomes a tax free benefit.

Randy Sams:
You no longer have to worry about these. And any funds that you take out of that Roth conversion are now tax free and you can pass that on to your heirs tax free. Also not creating putting them in a tax burden. Let's build your own personal pension. You can never outlive you. Receive a bonus. With certain fixed indexed annuities. You can grow your principal with market like gains and no market risk. So the money you invest in an indexed annuity is protected by Flor and you can never do worse than a 0% in a year. Remember, zero is your hero. So here's what I say. Guarantee yourself and your spouse a lifetime income with a personal pension. So take your 401. K, take your 403. B, take your IRAs. If you're over 59.5 and we can put that they'll put those funds into a guaranteed lifetime income annuity and set yourself up and your spouse up with a personal pension. All right. Replace your bonds completely. Two strategies for that. Number one, fixed indexed annuities and a structured note ladder. All right. If you have an income annuity, you add an income annuity to your portfolio. It acts like a triple A rated bond and a triple C rated return with triple C rated return. So it's going to do two things. It's going to lower your risk and it's going to increase your returns. All right. So number eight, diversify your accounts between tax deferred taxable and tax free. Number nine. Accurately calculate your monthly expenses and build a positive income gap.

Randy Sams:
At the start of your retirement positive income gap. Here's the formula. Deduct your monthly expenses from your monthly income. Anything left over? That's a positive income gap. A negative income gap. You have more expenses than you have income coming in. All right. We want to be able to set you and your spouse up with a positive income gap, and we can do that. With a guaranteed lifetime income annuity. So number number one question. Those are the nine ways to live comfortably. Two questions I want you to ask yourself How much guaranteed income do I currently have? Number two, have I eliminated the number one retirement risk from my retirement plan? That number one, retirement risk is longevity risk. The longer you live. You have the possibility of running out of money? The longer you live, you may not spend enough. You may not spend. You may spend too much. All right. The longer you live, you're going to have some health issues, more than likely. So give us a call. (866) 990-7664. Or go to our website YourAmericanRetirement.com. Leave us your information. We'd love to sit down and have a free consultation with you and your spouse and talk about some of the objectives. Talk about some of the nine ways to live comfortably and help us. Let us help you set yourself up for a happy and a secure retirement. Hey again, you're listening to Your American Retirement on 101.1 FM. The Answer where Little Rock comes to talk. We'll be right back.

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Are you concerned about market volatility, rising taxes, economic uncertainty and how it all could affect your future in retirement? Then tune in to Your American Retirement to learn how you can protect and grow your hard earned money. Your American Retirement. Every Saturday at 1 p.m. right here on 101.1 FM. The Answer protect your hard earned money today and schedule a free no obligation consultation now at YourAmericanRetirement.com.

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If inflation and living expenses are putting more of a financial strain on your bottom line, it may be time to explore canceling those unnecessary subscriptions. I'm Jim. With the Retirement.Radio Network Powered by AmeriLife. In recent years, streaming and subscription services have dominated the digital space. According to a survey done by Chase Bank in February of last year, the study found that a whopping 71% of Americans waste over $50 a month on unwanted subscription fees, and it's becoming increasingly harder to cancel these subscriptions. Meanwhile, the Federal Trade Commission proposed a provision back in March targeting the struggles of customers to cancel their unwanted subscription payment plans. Under this new proposal, titled Click to Cancel, the sellers would face a requirement to make subscription cancellations as simple and as straightforward as possible. Axios technology reporter Ashley Gold was a guest recently on CBS News MoneyWatch to break down this new proposal.

Ashley Gold:
Those little prompts you see that are like, Are you sure you want to cancel? We can offer you this deal. We can offer you that deal or to cancel, you actually have to call us between these business hours or to cancel. You have to show up in person and tell us why. None of that's going to be allowed anymore. If what the FTC wants to do passes in its final form.

Producer:
So in the meantime, how can you keep your subscription prices from slashing further into your own personal bottom line? Review all of your monthly subscriptions from every sector on every device and cancel the ones you don't need. Useful tools like rocket money and pocket guard can help you track down these unwanted subscriptions and clear them from your monthly expenses. Cutting back on your monthly subscriptions. It's an important factor to consider, and it's part of our 23 retirement cost cutters of 2023 for the Retirement.Radio Network Powered by AmeriLife. I'm Jim Tabaka to get your free copy of 23 Retirement cost Cutters for 2023, reach out to Randy at (866) 990-7664 or visit the website YourAmericanRetirement.com.

Producer:
Are you concerned about market volatility, rising taxes, economic uncertainty and how it all could affect your future in retirement? Then tune in to Your American Retirement to learn how you can protect and grow your hard earned money. Your American Retirement. Every Saturday at 10 a.m. right here on 101.1 FM. The Answer protect your retirement and schedule a free no obligation consultation now at YourAmericanRetirement.com. Miss part of today's show. Your American Retirement is available wherever you listen to podcasts and online at YourAmericanRetirement.com.

Randy Sams:
Hey welcome back. You're listening to Your American Retirement on 101.1 FM. The Answer Where Little Rock comes to Talk. My name is Randy Sams. I am your host, president, CEO of SMMG Financial. Folks, if you've listened to the show, a lot of you guys, I know y'all listen every Saturday and thank you so much. But you know where I stand on guaranteed lifetime income and you know where I stand on annuities. All right. So I've got a little story that I'm going to spend some time and go over with you. And this story is from Advisor Perspectives. It was written by David. And this was done on March 21st, 2023, and it's called Annuity Never. So listen, here's the parable. You know, Jesus spoke in parables. We're going to do a little parable today. So are you. Properly responding to the need for lifetime income. Consider this parable. Not. Five minutes into the meeting with Cheryl Burke, a financial planner, appeared to fully understand her twin priorities. Number one, protect Cheryl's nest egg and number two, provide monthly income that will last for the duration of her retirement. Those were unambiguous objectives from Cheryl's perspective. I recommend an annuity, Burke said. She replied. How does it work? Well, you purchase an annuity with a lump sum of money. In turn, it provides you a monthly paycheck. The payments can commence as soon as 30 days, or they may be deferred until a later date if there is a deferral.

Randy Sams:
The amount of the payments you receive will be higher. Are the payments guaranteed? Ask Cheryl. Burt replied. Guaranteed. No, not guaranteed. But there is a high probability that you will receive the payments for your entire lifetime. Cheryl asked. High probability. What does that mean? Well, said Burke. My computer printout indicates that you would have a 95% probability of receiving these payments for as many as 30 years. That would take you several years past your life expectancy. So there's a margin there. But again, no certainty that I will continue to receive the income, Correct? Burt replied, A high probability 95% is quite high. That should give you confidence. Cheryl, however, did not feel confident. Her inner voice told her that she should seek out another financial adviser. So the following day, Cheryl called her friend Jamie. And ask if she could recommend a financial adviser. Well, my husband likes a guy named Andy. Here's what Jamie said. The following week, Cheryl met Amy and Andy at his office. As she did when she spoke with Bert, Cheryl very specifically described her goals and financial priorities. Number one, protect her assets. Number two, provide income. Andy's response was like, Bert's. Cheryl, I believe you should purchase an annuity. The reason is that it will continue to pay you monthly payments throughout retirement. Andy. I have questions about that. I can't know how long I'm going to live in retirement. I do know that my mom lived until age 94.

Randy Sams:
If I live to an old age, say to 94, like my mom or even to 100. Will the annuity continue to pay me for that long? Good question. Good chance, asserted Andy. Let me get a printout from my computer here while we're speaking. A moment later, Andy picked up the key piece of paper. It says here, Cheryl, that you will have a 77% chance of receiving this income for as long as 30 years. Cheryl paused for a moment. Andy. I'm no mathematician, but this tells me there's a 23% chance that my income will not last. Am I right? Yes, Cheryl, you are correct. But 7,777% is a high probability. It should give you confidence. You see in a pattern here yet? So the following day, Cheryl decided to take another path. She called a well known investment firm, you know, one that advertises heavily on television. When she finally connected with a financial adviser, she again described her goals and objectives. Once again, it was an annuity that the adviser recommended. I suggest you purchase an annuity that will pay monthly income and has a 90% probability of lasting for 30 years. Cheryl asked the advisor, Is there no annuity that guarantees that the income will last until I die? What happens if I live for 42 years? I don't want to be well into my old age only to discover that I have lost all my income. No, replied the adviser. Annuities don't do that, but there is a 90% probability your income will continue.

Randy Sams:
And that's really high. Really, really high. That should give you confidence. Hmm. Where did we hear that before? So several days later, Cheryl met her friend Kathy for lunch. Cheryl related her frustrating experiences with the three financial advisers. She described how each adviser had recommended an annuity, but that each recommendation. Varied when it came to what Cheryl considered to be the most important issue for her was income. Okay, said Kathy. You explained your needs in a consistent way to all three of them. Why the three different results? Seems to me that this annuity business is pretty arbitrary. I'm thinking like you when I retire, I want certainty. The last thing I want to be is to be worrying about my income stopping. What do these advisors expect? That we should go and become financial burden on our kids? Exactly. That's my perspective, said Cheryl. It's amazing to me that all three of these advisors, the financial advisor, asked me to be confident. But how can I be confident when one says 95%? Another says 90% and yet another says 77%. That doesn't give me any confidence at all. The that only gives me skepticism. They're asking me to trust this annuity approach, but there's nothing that I can hold on to that is certain. The annuities, they suggest, have no guarantee of anything. So, Cheryl continued, Look, I watched my mother in retirement.

Randy Sams:
God knows I took over the job of paying her bills. It taught me that when I retire. I will need income. That doesn't stop if I live to 90, 95 or 100. I absolutely know that I will need income every month. And it has to be income that I can count on. It needs to be 100% certain. This annuity, these advisors keep suggesting is no Answer for that. So the ladies looked at each other. Neither said anything for what seemed to be a long time. There were, however, they were communicating, you know, that look that they give each other. So some things just don't need to be spoken. Finally, Kathy spoke. I questioned whether these three men actually heard you when you described what you wanted. You ask that they protect your money. You stated that you want income that is guaranteed for life. They responded by recommending an uncertain approach. And then then they expected you to feel confident about a recommendation that did not provide what you told them you wanted. This is such an inappropriate way to treat a potential customer. It would actually be funny if it wasn't so sad. Cheryl said, Yes, that's how I see it. I'm supposed to push aside my needs in favor of their Answer. Annuity. Makes me wonder, is it the men or is it the companies behind them? Are they trained to be this way? They pretend to listen to me and then just recommend what they want to sell.

Randy Sams:
I think it's probably the culture, said Kathy. I won't do business with that. I'll look for a woman to work with or a man who will hear me. Assuming I can find one. She laughed. And believe me, Cheryl replied, I will never buy one of those annuities. No, no, no. I want certainty. I want it guaranteed. Don't let me. Don't tell me to be confident in some percentage that is entirely dependent on whom I speak with. These people just don't get me so they won't get my money. My search continues. Annuities? Never. Did you hear that, folks? That's the parable. But now I want you to make this substitution. Consider this satirical story. Folks, this was satire. You know, I love annuities, but this time substitute Monte Carlo simulation in conjunction with systematic withdrawal plan where I said annuity substitute Monte Carlo simulation in conjunction with a systematic withdrawal plan. Okay. A monte Carlo simulation is a process that produces a less than 100% guarantee, not annuities. Annuities. A lifetime income annuity will give you a 100% guarantee. So this reveals what is wrong with the most used approach for retirement income planning. Do you see why systematic withdrawal strategy is misaligned with the needs and objectives of most boomer women? So when will planners move past this? Will it be only when they are fired by widows? Or will they accede to women's concerns about outliving their incomes and start recommending the longevity protection that only annuities can provide? Remember, guaranteed lifetime income annuity.

Randy Sams:
So I would ban Monte Carlo simulations in the context of retirement income planning. In practice, Monte Carlo is used as a proxy for safety, but it is not a proxy for safety. So to advisors and planners who remain steadfast in your opposition to annuities, give it up. All your historical objections to annuities have been eliminated. Are you not a fiduciary? Are you not legally bound? To act in the client's best interest in the woman's best interest. If you are. Then give her the client the guarantees she wants and deserves. So I'm not condemning Monte Carlo simulation per se. Monte Carlo has shown its utility in many industries and contexts. Rather, I'm highlighting that Monte Carlo simulation is misused by advisors when it is understood by clients as a proxy for safety to instill a false sense of confidence in. In instances where clients, especially women, are denied longevity protection because of a monte Carlo simulation indicating a high probability of continued income, expect the outcome to be shame for a long time to come. Folks, that's why I love annuities. Guaranteed lifetime income annuities. I can look you in the face and say 100% guarantee lifetime income. In other words, your blood pressure will go to zero before your annuity does. Hey. My name is Randy Sams. You're listening to Your American Retirement on 101.1 FM. The Answer. We'll be right back.

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Producer:
Do you want to be a jet setter in retirement? Keep an eye on how much you're spending. I'm Matt McClure with the Retirement.Radio Network. Powered by AmeriLife. Pretty much everyone loves saving money, but that doesn't mean you can't pack your bags and see the world. This year. There are some simple steps you can take to reduce costs while still checking off your travel wish list. One thing to consider traveling during the off season peak season will always be more crowded and more expensive. So take that trip to the beach in the early fall when the weather is still warm, but the kids are back in school. While the timing of your trip is important, so is when you book Mark with a popular travel focused YouTube channel. Walters World says you should book as far in advance as possible.

Walters World:
I know, for example, in Germany, if you pre-book your tickets on the train, it's a significant discount than if you buy the same day. So make sure you use that advantage of doing things beforehand, whether it's a hotel room or it's tickets to a show or it's tickets to transportation, it can make a big difference. So use those discounts you can get by booking early.

Producer:
Also look for deals on flights and hotels through discount sites. Consider booking a rental home or apartment instead of a hotel, and think about taking public transit instead of a cab or ride share. So have you considered all the ways to cut your travel costs this year? It's a key question to consider, and it's one of the 23 retirement cost cutters for 2023 with the Retirement.Radio Network powered by AmeriLife. I'm Matt McClure.

Producer:
To get your free copy of 23 Retirement cost cutters for 2023, reach out to Randy at (866) 990-7664 or visit the website YourAmericanRetirement.com.

Producer:
Like what you're hearing you can watch the show to visit YouTube.com and search Your American Retirement to watch clips from this program.

Randy Sams:
Hey welcome back. Central Arkansas again you're listening to Your American Retirement on 101.1 FM. The Answer where Little Rock comes to talk. My name is Randy Sams. I'm your host, the president CEO of SMMG Financial. Hey, folks, we're going to wrap up the show today. We're going to talk about a little thing, reasons why you should meet with an advisor or financial professor, professional number one, if you don't understand what an expense ratio is, you need to meet with an advisor. If you don't understand the risk you are taking with your investments, you need to meet with an advisor if you don't have a formal retirement plan. In other words, one that's not written on a restaurant napkin, you need to meet with an advisor. If you don't understand how you should manage risk in your portfolio as you get older. If you don't know if you should pay your house off or not. If you don't have a health care plan or a long term care plan in place, hey, you know how you can meet with an advisor, You can go to YourAmericanRetirement.com. Leave me your contact information or you can call 86699076648669907664. Leave us your information and we'll be glad to reach out and set up a consultation. So what are you going to get when you set up that free consultation for our listeners? We're going to provide these comprehensive consultations at no cost to you, our listeners, and there is no obligation. Folks, We're in the education business. You only work with us if it's best for you.

Randy Sams:
So we will help you analyze your financial situation. We will closely examine any annuities that you may currently have, and we will we will discover exactly how much you are paying in fees and help you cut unnecessary cost in your 401. K or any other retirement savings account. I'm going to back up to the one before this, before I finish these. A meeting with a couple right now. She's had an annuity for quite a while and she is wanting to do something different with that annuity. So what we're doing is we have looked at her annuity, we've gone through it, and we've highlighted some areas of concern for us and of concern for her. And we're going to be able to present a couple of options. Again, it's her decision whether or not she wants to change. But the good thing is, is that she's had the annuity long enough that there are no surrender charges. There are no penalties for her moving the money and she can take the money from that current annuity and move it into a different annuity. She's young enough that if she wants it to continue to grow and then turn on income later on. So we're going to look at a couple of different options for her. We're going to present those to her and give her options to put her funds from the current annuity she have, which is not growing, doing very much for her currently and put it into a guaranteed income annuity. So we can also help you with your Social Security and planning for your Medicare.

Randy Sams:
Folks. You remember a little bit earlier we talked about is it best for you to turn on your Social Security at age 62? Is it best to wait till your. Full retirement age, which may be 66.5 or 67, or can we create a Social Security bridge and get you all the way to age 70? That's a good question, isn't it? So they're going to say, Randy, what's a Social Security bridge? Hey, call (866) 990-7664. I'll call you back and we can talk about it or go to the website YourAmericanRetirement.com and say hey Randy I want that information on that Social Security bridge what that's all about so we can put together a plan that will take you to age 70. It could take you from 62 to 67. It could take you from 62 to 70. It could take you from 67 to 70. A lot of little intricate intricacies there that we're going to look at and we'll meet with you. So we're going to compare your current situation to what's possible. If you work with us. Remember, it's your money. And if it matters to you, it matters to me. So folks, want to give you a little example. Some of the things that that we can do for you. We're going to do a little problem solver for you. I've got an example of a client. This is looking at a bond replacement. Help this family close their income gap.

Producer:
It's time for this week's problem solver.

Randy Sams:
A problem. A man who just turned 70 still works. His wife does not work and is ready for him to retire. The wife wants to travel, but the husband is concerned they don't have enough saved for retirement. The way they want or enough saved to retire the way they want. She wants to join the country club. She wants to play golf. She wants to play tennis. She wants to go make it. Every day is happy hour. Every day is Saturday. Every hour is happy hour. So the man has $900,000 saved in a 401. K. The couple would receive 4800 a month in combined Social Security. So they're a little bit short. But here's the solution Got 900,000 to work with. By replacing their bonds and investing into an annuity, they will generate an additional 2000 every month of income for the rest of their life. That's his and hers. They also found ways to cut their monthly expenses to to fill their retirement income gap. In other words, their income gap was negative. They had too many expenses and not enough income. So we were able to take care of that. So they will save money by deleting. Their portfolio and advisory fees and their annuity is tied to an index so that an annual cost of living adjustments will help them outpace inflation. So they get to enjoy the upstroke of that index. And remember, zero is your hero. So if you're listening to the show right now and you feel like you can relate to some of the scenarios that we describe on our program, please get in touch with us so we can provide you with a free, complimentary consultation just for listening to the show today and remember our free give.

Randy Sams:
Folks, if you'll get in contact with me. (866) 990-7664. Or YourAmericanRetirement.com. We ask for our free reports today we're giving away two. We're giving away Secure Act 2.0 and what it means for your retirement. And the second report we're given away absolutely free. Too big to fail when banks collapse and what it means for consumers and retirees. So again, if you go to the website YourAmericanRetirement.com or call (866) 990-7664. Leave us your information. Tell us you want those free reports and we'll send them to you in the mail or we'll send them to you via email. Either way. All right. So folks, I want to tell you how much I've enjoyed today's show. Again, like we said, to begin with, this is the day before Easter. God has given us the best retirement plan, the best eternal retirement plan that anyone has an opportunity and everyone has an opportunity to take advantage of. So remember, as it says in the word of God, he's not here. He is risen. Hey, Randy Sams, you're listening to Your American Retirement on 101 FM. The Answer where Little Rock Comes to talk. Have a great Easter weekend. God bless you.

Producer:
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 YourAmericanRetirement.com today that's YourAmericanRetirement.com.

Producer:
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. AmeriLife assumes no responsibility or liability for the content of this message. The information contained herein is provided on an as is basis with no guarantees of completeness, accuracy, usefulness, timeliness, or of the results obtained from the use of this information.

Ford Stokes:
Chapter nine, you can create your own personal pension. Big idea Using an annuity to create a personal pension helps you create a lifetime income stream, but it also helps you leave a legacy for your beneficiaries. All annuities can create annuity income to supplement the income you need before or during retirement. Those who are approaching retirement are afraid that they will run out of money. But an annuity can help make sure you have income you can never outlive. An annuity can be a great investment for your portfolio, but encourage you to be careful that you don't overpay for your annuity. When you put your money into an annuity, the annuity company will pay you your money back at a date. You specify you don't want an annuity company to charge you too much to simply pay your money back to you. I'm confident that leaving a remarkable family legacy is important to you. You likely want to have money left over when you pass away to leave your beneficiaries. The goal of a personal pension is to generate lifetime income with no risk that grows your money and allows penalty free withdrawals. An annuity can create a lifetime income with market like gains and no market risk, while also allowing you to build enough wealth to leave for your beneficiaries when you pass away. Don't give the annuity company fees for doing nothing. We prefer fixed index annuities for our clients that do not have an income writer fee. But you can still create a personal pension without an income writer on your annuity.

Ford Stokes:
If you get an annuity with an income writer, but don't utilize the features of that income writer, then you are not getting what you paid for. You are literally just paying the annuity company 1 to 2% each year. You defer annuity using your annuity without receiving a single benefit for that annual fee. This income writer fee will also draw down your account value or principal, depending on how that index is performing. The growth on your entire account value could be significantly and negatively impacted. Some accumulation focused annuities are built to deliver increasing payments. Without an income writer, you should consider the features your income writer is providing you before deciding to purchase it. As an add on. Make sure you utilize the features you are paying for more ways to get the most out of your annuity. The longer you wait to turn on the annuity, the more you'll receive an annual payments. This is because your annuity will spend a longer time in the accumulation phase, meaning it will spend more time building up your account value. Your annual payments will grow as your account value grows. Believe it or not, you can generate your own personal pension by distributing no more than 5% a year with penalty free withdrawals from your accumulation based annuity policy. Many accumulation annuities are set up to be RMD friendly so you won't suffer a penalty when you have to take your RMD. It would be silly for you to be penalized for something you are required to do. Annuity companies take this into account by creating products that make taking your RMDs easier.

Ford Stokes:
Inspect what you expect with any annuity. Don't just go with what the annuity agent or adviser tells you. Read it for yourself Specifically, you should read the annuity illustration guaranteed and non-guaranteed tables included within the annuity illustration. Also, please remember that an annuity policy is a contract between you and the annuity company. So caveat emptor or buyer beware applies here. Be aware of the annuity you are buying and choose an annuity that works best for you that will help you build a successful retirement and they'll offer you peace of mind. Whether you choose to generate income through penalty free withdrawals or invest annually in an income rider know the consequences of both. This is a decision you will make at the beginning of the investment process. One poor decision here can cost you 1 to 1.5% of annual growth over a 30 year retirement. This could come out to be a significant loss. Educate yourself on your options and the specifics of each option you are considering. Making the right decision up front will save you a lot of frustration in the long run. Also, please remember that if you withdraw too much annually, say 10%, you will run out of money in 10 to 12 years. Make sure that you are working with an advisor who can help you choose the appropriate withdrawal amount so that your money lasts for your entire lifetime. As discussed above, we recommend no more than 5% be withdrawn each year from your account.

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