2.17.23: Audio automatically transcribed by Sonix

2.17.23: 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, everybody. I'd like to welcome you to this morning's show. I want to thank you for taking some time on this Saturday morning. You're up a little bit early, I guess now it's 10:00. So you're not you're not up early. You guys have probably been up since 6:00. Hey, listen, again, thank you for joining. You're listening to Your American Retirement on 101.1 FM The Answer My name is Randy Sams. I am your host. I'm also the president CEO for SMMG Financial. And folks, I just want to thank you again for tuning in to Your American Retirement. Thanks for listening to the show. We've had a lot of good comments over the past few weeks. Basically since the start of 2023. We've had some really good comments and some good suggestions as far as what folks want me to kind of spend some time on the show and talk about as far as retirement planning, folks, that's what we're all about at SMMG. You know, I just want to let you also know that you're listening to us on 101.1 FM The Answer. But you can also go to your favorite podcasts wherever you listen to your podcast, YouTube, Spotify, whatever that might be, and look for YourAmericanRetirement.com. And you're going to see we have a podcast. So do me a favor. If you go to that podcast, give us a thumbs up. Tell your friends and family about it.

Randy Sams:
We again love hearing from our listeners and it's something that we take to heart, folks. We want to make sure that we educate more Americans on ways to reach financial freedom and retire successfully and securely. You see, we believe in educating. Yeah, you know, I'm in marketing, I'm in sales. But, you know, what I tell people is they said, well, you know, I've had a lot of sales people come by and talk to me. Randy And what makes you different? I said, Well, you know, I make my living. By what? By what I sell. But guess what? You're under no obligation. See, I believe in educating my clients. So I'm going to spend time with you and listen to your objects. I'm going to listen. Okay? That's what's important. We're going to listen to what your objectives might be. We're going to talk about different things. We're going to talk about income. We're going to talk about Social Security. If you're lucky to have them. We're going to talk about health insurance. We're going to talk about long term care. So there's a lot of things that we're going to spend time talking about. But mainly I'm going to listen to you talk about what your objectives are during retirement. So remember what we do. We're focused on addressing major financial issues facing retirees and pre-retirees in America today by helping people understand, educate and prepare for a secure retirement, not a risky retirement.

Randy Sams:
Folks. That's what we do at SMMG Financial, Your American Retirement. So, folks, again, check our website, check out the Web, the podcast again with any questions that you may have. Again, we love helping our listeners and we can provide comprehensive consultations to anyone who reaches out to us. And again, guess what? There's no obligation. So take advantage of my 36 years experience in this in this industry and working with folks like yourself. You know, I travel five states, so I'm quite busy working with folks all across the, you know, central, I guess you'd call it the Southeast, Arkansas, Tennessee, Mississippi, Louisiana, Texas, some in Oklahoma, a little bit in Missouri. So you add those up, there's more than five. But my main focus are the five states right around Arkansas. Okay. So folks, people ask me, So, Randy, again, what do you do at SMMG? Well, we want to focus on removing two things from your retirement. Number one is stress. And number two is rocking chairs that might or might not make a lot of sense to you. But believe when you spend some time with me, you'll understand. So removing stress, because as you know, stress is a killer. Stress leads to a lot of different health issues for a lot of folks out there. You know, stress. You worry about spending too much. You're worrying about running out of money. You're worrying about, am I going to get sick as I get older? You know, am I going to be able to join that country club? Am I going to be able to take those cruises? So that's what we want to take.

Randy Sams:
We want to take that worry, worry, worry out of your retirement. And we want to make sure. That your retirement account does not hit zero before your blood pressure does. Does that make sense? So we want to make sure that your retirement account does not hit zero before your blood pressure does. All right, then. Rocking chairs. What is rocking chairs have to do with my retirement, Randy? Well, rocking chairs are for those people who have sit around and worried about not having enough money. And they're afraid to go out and do anything. You know, you've worked all your life to enjoy retirement, folks. And that's what we want you to do, is we want you to enjoy your retirement. All right. But if you're concerned about running out of money, if you're concerned about spending too much money and withdrawing too much, what's it going to be then? Are you going to do is you're going to sit around, you're going to be on that front porch sitting in that rocking chair. And you know what? Rocking chairs, they don't get you anywhere, folks. You're just going back and forth, back and forth. So let us take that stress away from you.

Randy Sams:
Let us take you out of that rocking chair and let us put you in a situation where you're going to enjoy your retirement, where you're going to have a safe and a secure retirement, not a risky retirement. So, folks, that's what we do at SMMG. And again, I want to thank you for listening Again, my name is Randy Sams. You're listening to Your American Retirement on 101.1 FM The Answer and folks, you know, already said we appreciate our listeners and from time to time should like I said quite often, so far in 2023, we've had a lot of folks that have left some very good comments, very good suggestions on what they would like for us to talk about. And on today's show, the first little segment here I'm going to talk about, we had a listener, a couple of shows back. If you all remember, we spoke about RMDs with the Secure Act 2.0 that took effect in January 1st, 2023. There were some changes to the RMDs, in other words, an RMD. So what I'm going to look at right now and talk very quickly is planning for your first required minimum distribution in retirement. Folks, this should help those of you who. May not be the age of taking an RMD, but at least this way you'll know when. Right now the IRS Uncle Sam requires you to start taking those RMDs. So here's what happens when you have a qualified retirement plans like a 401.

Randy Sams:
A 403 B IRAs. They offer you no tax advantages. It's all tax deferred. So they offer tax deferral on your contributions and growth until distribution. So what happens is to prevent individuals from taking advantage of this tax deferred growth. You know, in perpetuity, in other words, forever. There are certain rules in place. Those rules are put in place. One of them is called a required minimum distribution. So, in other words, folks, we've worked all our life. We've accumulated a lot of money in that 401. K or that 403 B or that IRA. Then all of a sudden we get to a certain age, you know, we may not need that money. We may not feel like we may have a good pension, we may have Social Security. Our expenses are minimal and that money's just sitting there. Well, instead of us being able to just leave it there and leave it to our spouse when we pass away or leave it to our kids or grandkids, Uncle Sam has put in one of the requirements is a required minimum distribution, so taxpayers with qualified retirement accounts are required to start taking distributions from the accounts once you hit a certain age now, right? The age was 70.5 prior to 2020, it jumped up to 72 from 2020 to 2022. And starting in 2020 through 2023, that new age is 73. Okay. So with the passage of the secure 2.0 act.

Randy Sams:
Your RMD. Now, if you were going to turn 72 this year, you were probably thinking you were going to have to take that RMD. Well, guess what? They've given you a one year reprieve. But next year in 2024 you will have to take that RMD at age 73. And the bill also includes a provision to increase the RMD age in ten years to age 75. So folks. The RMD rule applies to all employer sponsored qualified retirement plans accounts, with the exception of Roth IRAs and beginning in 2024 due to secure 2.0 Act Roth 401 K's are also included. So if someone is still working at or beyond RMD age and their company offers a qualified retirement plan such as a 401. K, the distribution requirement for that plan specifically is deferred until the person retires or otherwise stops working for that company. Basically what that means, folks, is if you're 73 and you're still working at a company that has a 401. K and you're still making contributions and they're still matching those contributions, as long as you're still actively at work, you don't have to take those RMDs. But once you quit, once you retire. Then you have to start taking those RMDs. All right. So. You know, due to the mechanics of the RMD age increasing from 72 to 73 this year in 2023, a smaller subset of people will be required to take their first distribution in 2023.

Randy Sams:
So if you turn 72 in 2022, your first RMD would need to come out by April 1st, 2023 and a second RMD for 2023 would need to be distributed by December 31st 2023. That makes sense. So if you turn 72 last year and you didn't take your first RMD by December 31st last year, you have the grace period. Only grace period is for the first rmd that you have to take, you have to take that RMD for 2022 at least by April 1st, 2023 and then you have to turn right back around before the end of this year and take your 2023 RMD distribution. All right. So the RMD amount, it's a minimum amount that must be withdrawn and subject to tax. It's calculated using life expectancy tables provided by the IRS. The intent is to draw down tax advantaged retirement accounts over the life of the taxpayer. So as a result. The minimum distribution amount will change every year, depending on the current age factor and the prior years distribution. So folks, I hope that kind of clears up a little bit about the RMDs. If you've got other questions, remember you can go to the website YourAmericanRetirement.com or call me 8669907664. Leave me your message. Leave me your contact information and I'll get back with you and we can discuss RMDs concerning your objectives. Hey again, thank you for listening. We'll be right back.

Producer:
This is Your American Retirement to schedule a free no obligation consultation with Randy. Visit YourAmericanRetirement.com

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.

Randy Sams:
Hey, welcome back, folks. Again, my name is Randy Sams. I'd like to welcome you to Your American Retirement on 101.1 FM The Answer Where Little Rock Comes to Talk. Hey, again, I want to give a shout out to all our listeners. I want to thank you for joining us this Saturday morning. As you know, we have before we'd been on in the afternoon here at 101.1 FM, and they changed up our times, which is great as far as I'm concerned. So you guys get to hear my beautiful voice first thing in the morning again at 10:00 on 101.1 FM The Answer Let your friends and family know that our time for our YourAmericanRetirement.com radio show has changed to 10:00 on Saturdays, folks. We're going to do a little financial wisdom.

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

Randy Sams:
Quote of the week. The quote of the week comes from Mr. Dave Ramsey. Some of y'all may be big fans of Dave. Dave Ramsey. He's been around for a long time. But the quote of the week, financial wisdom Financial peace isn't the acquisition of stuff. It's learning to live on less than you make. Whew. That's a tough one right there. It's learning to live on less than you make so you can give money back and have money to invest. You can't win until you do this. All right. So that that's that's some pretty sound financial advice because, folks, here's what I see with today's situations, a lot of folks, is they're living paycheck to paycheck. You know that a lot of people are struggling, but it's learning to live on less than you make. So you can give money back and have money to invest. So you can't win until you do this. That quote of the week is by Mr. Dave Ramsey. So, folks, we want you to live a lifestyle in retirement that you enjoy, but we also want to make sure that your money outlives you. Remember that little quote I gave to you? We don't want your retirement account to hit zero before your blood pressure does. All right. So we want you to live a long life with a lot of no stress. Take that stress off. Don't have to live in those rocking chairs. So we want you to. Make sure that you outlive your money, outlives you in retirement. So I encourage all my listeners to visit my website.

Randy Sams:
YourAmericanRetirement.com . Leave me your contact information. Leave me a message. I'll get back in contact with you or leave me a message. (866) 990-7664. Give us a call again. (866) 990-7664. Or local 501 249 2343. So again, folks, schedule a complimentary consultation with me. There's no obligation. We want to learn more about you, how we can help you live a stress free retirement lifestyle that you deserve. Remember, we want to take away that stress. So folks, listen. We're going to jump right into what I've got some questions about. Some folks have gotten you know, they love the show because we talk about retirement. We talk about what some of the things if you're getting ready to retire, you got to plan for retire. What are some of the questions we should be asking ourselves If we're in retirement? Things may not have been working out like we planned. So if we make changes, you know, what are some of the things that we need to look at? So here's what I've got to say. So what to Know about retirement unknowns? Four Questions To Better Understand Retirement Income folks, I've yet to meet with a retiree or someone who's about to be a retiree. That doesn't need income. You see, the question you got to ask yourself is this. Where will the paycheck come from when the paychecks stop? So when you retire, where's that money going to come from? Where's that income going to come from? Social Security, pension? What else? All right. So that's what we're going to talk about.

Randy Sams:
Four questions to better understand retirement income. So whether you've been planning for decades or scrambling to catch up for years, retirement is one of life's best or least defined, most surprising phases. So let me say that again retirement is one of life's least defined and most surprising phases when it should be one of your best phases. Right? We break down common retirement unknowns and some options that you can help tackle them. So here's what we're going to do. So preparing for your golden years can both be exciting and intimidating. However, as you plan for your retirement, there are several important factors that can make things easier to understand to create a clearer path for a successful retirement. So consider these four questions or these four topics as you navigate the retirement planning space, hopefully with Randy Sams at SMMG Financial, give us a call. Number one will outlive my retirement savings, Folks, this is known as longevity risk. All right. The short answer to this question is it depends. So many people heading into retirement or planning for it are concerned about focusing on accumulating as many assets as possible so they can spend them once they retire. Okay. So when you're working, guess what? It's all about accumulation. It's all about accumulation. It's all about accumulation. All right. So accumulated assets are highly dependent upon several factors, including taxes, market declines, changes in personal lives like divorce. And once retirement begins, retirees might begin spending their assets and how quickly they spend those assets and how long those assets will last depends upon like I said, your withdrawal rate.

Randy Sams:
Are you taking that too much? Are you taking that too little? So to put this into perspective, the average 65 year old can expect to live another 20 years in retirement. It's estimated that half of those 65 year old retirees today will live to 93. Did you hear that? Half of those 65 year old retirees today will live to be age 93 unless assets are carefully calculated to take this into account. Accumulated wealth is likely to decline in that time frame. A fixed indexed annuity can help provide more stability when it comes to finances in retirement. Fixed indexed annuity is a retirement product purchased from an insurance company. I call it a risk transfer vehicle in exchange for certain guarantees. So an insurance product, the money is not invested in the stock market or index. It's protected from index declines while still having the opportunity to grow each year. So the longer the income from the annuity is deferred, the more opportunity for tax deferral and growth potential there is because growth in that indexed annuity is tax deferred. Okay, so. The structure of a lifetime income annuity is built around longevity. So we want to take that longevity risk off the table. All right. It's designed to pay for as long as needed, as long as you live with options for a spouse to continue receiving payments after death. Okay. So you can set up a single life payment based on your life only.

Randy Sams:
Or we can set it up for joint life where it's paid for your life upon your death. Then it's paid to your spouse as long as they live. All right. So. And. Guess what? It potentially eliminate probate time and cost. All right. Eliminate that probate. When's the right time to retire? This is timing risk, folks. Every retirement is different and so is your retirement threshold. So plans often change and you can. And so your retirement plan can change. Also, such as when you plan to leave workforce, you plan on leaving early. Your account went down by 25% last year and now you're going to have to work a couple of years longer. According See, according to a recent survey, nearly half of retirees, 48%, left the workforce earlier than they'd planned. All right. A majority of earlier than expected departures from the workplace were due to health or disability issues. That's why we want to talk about long term care when we meet. All right. And as well as company changes, you've probably seen a lot of headlines lately about a lot of these big tech companies are laying off thousands of employees right now. All right. So you see, folks, there may not be a retirement, a magic retirement age or a dollar amount. Reframing retirement assets as retirement income can clarify what your money can do for you when the time comes. Okay. Map out your retirement practices, priorities. You must have what you're going to have to have. Basically what we're looking at, folks, is your basic expenses.

Randy Sams:
All right. So map out your retirement priorities, your must haves, your you know, what do I need? These are my basic expenses. And identify the income option to fund them. Number three, can my retirement portfolio handle a market downturn? And how does uncertainty impact my nest egg, my retirement nest egg growth? This is known as sequence of returns risk folks. So fixed indexed annuities. Can you tell I'm a big fan of fixed indexed and also provide a potential upside with growth and protect. This potential downturn. Market volatility. A fixed indexed annuity product can help shield a portion of your retirement income. So this guaranteed income stream provides payouts that are not tethered to market, not tied to the market, and also provides diversified index linked crediting strategies for stability and growth potential over time. Okay, so here's what happens, folks. Sequence of return. So money lost in market declines requires exponentially higher returns to recover. Example A 10% loss requires an 11% gain to recover. Back to where you were. A loss of 25% takes 33% gain to recover where you were to begin with. A 30% loss requires a 43% to break even and so on. All right. So the principal protection of a fixed indexed annuity establishes a retirement foundation that you can build off, saving yourself the time. And capital it takes to recoup market loss so your money can work for longer and work harder for you in that fixed indexed annuity. All of this, coupled with the growth potential and guaranteed lifetime income payout options, help ensure a reliable lifelong income generator.

Randy Sams:
Folks, that's why I'm a big annuity, especially guaranteed income is what I look at. Okay. How does Social Security impact my retirement income? Over half of future retirees believe Social Security will cover their basic living expenses. Folks, that's a lot. Over half of future retirees believe Social Security will cover their basic living expenses. However, Social Security covers less than half of a given worker's income before retirement. So efficiency is the key when it comes to retirement income. That means diversifying your retirement portfolio can help build stability that doesn't solely rely on Social Security folks. Only 7% of pre-retirees have a three legged retirement plan, which includes income from Social Security defined benefits, which would be a pension plan and a personally funded income, which is the annuity. All right. So we can take with a fixed indexed annuity, we can help turn assets into dependable income to supplement Social Security. So defined benefit plans or defined contribution accounts. Plus it allows penalty free withdrawals annually up to 10% during the contract value of the contract value and increase payment options that can kick in if healthcare needed. All right. So folks, consider working with us at SMMG Financial to clarify the questions you may have. But those are four questions that people ask why it's important to make sure you've set yourself up with a guaranteed lifetime income. Hey again, my name is Randy Sams. You're listening to Your American Retirement on 101.1 FM The Answer. We'll be right back.

Producer:
So you know where you are now and where you want to be in retirement. So how do you plan to get there? I'm Matt McClure with the Retirement.Radio Network Powered by Amara Life.

Heeeeeere's Jacky!:
Do you have any other questions for me, Counselor?

Producer:
There are a lot of questions to ask yourself when you start your retirement plan. Questions like When should I retire? How much money will I need? When should I claim Social Security? What about health care costs and taxes? In retirement, this complicated puzzle means you're probably going to need some help coming up with a smart retirement plan.

Ford Stokes:
If you want to retire successfully, you really need to plan early. You know, Inspector G, expect and get prepared. Putting a plan in place now while you're still working is a great idea.

Producer:
Ford Stokes is founder and president of Active Wealth Management. Once you find a financial professional you want to work with, they can help you answer all the questions you may have.

Ford Stokes:
Back to what Warren Buffett said. If you don't find a way to make money while you sleep, you're going to work until you die. So we need to do everything we can to figure out a way to make money while we're sleeping. We talk about this human capital versus actual capital. When you're young, you have a lot of human capital. You've got a lot of a lot of room left, a lot of capital left in your career. Right. But at the same time, a lot of people that are older let's say you're 65, 70 years old, you don't have a lot of human capital left, but you should have a lot of capital that is making money while you sleep. And if you don't, then you didn't make the right decisions.

Producer:
There are also some retirement costs you may not have considered yet. Long term care, for example. Did you know it's not covered by Medicare? What about home renovations? If you decide to stay in your home instead of moving into a facility? Your home might need some updates to ensure you're safe and comfortable. And those are just the tip of the iceberg. So do you have a fiduciary financial advisor or professional to help you wade through the complicated retirement planning process? That is a key question to consider. If you want to make the most of your hard earned money with a Retirement.Radio Network powered by AmeriLife. I'm Matt McClure.

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

Randy Sams:
Hey, welcome back again. My name is Randy Sams. Thank you for joining me on Your American Retirement 101.1 FM The Answer Where Little Rock Comes to Talk. Hey, folks, today's show we've been talking about RMDs. We've been talking about retirement income, questions you need to ask yourself, folks, this is all part if you've listened to the show over the past few weeks, you know, we've been kind of focusing on the smart retirement plan. We kind of look at this as the Smart retirement Plan series, smart lifestyle, smart legacy, smart adjustments, smart money, safe money. So that's what we look at, folks. That's what we do at SMMG Financial. We want to sit down with you and we want to put you in what we consider to be the best position where you can have a safe and a secure retirement, not a risky retirement. All right. I believe in guaranteed income. Income is what you retire on, folks. You don't retire on assets while you're working. We all want to accumulate as much as we possibly can. All right. But when you get to that age, again, I call it the retirement red zone. Five years before five years into retirement. Folks, you want to take the risk off the table. You have gotten yourself to a point where other people are trying to get to. So your objective from that point on, five years before five years, it's all right. You see what happens with that sequence of returns kicks in.

Randy Sams:
You're you've decided to retire and you're taking money out, You're making withdrawals. You may be taking it out of an IRA. You may be taking it out of a managed account. You may be taking it out of a 401. K. All right. But when you start taking money out, you're not in the accumulation anymore. You're in the accumulation. All right. Your accounts usually aren't increasing. It's decreasing or staying level, hopefully. But many of you that retired in 2022, I've had a lot of conversations over the past year and a half, folks, where you got close to retirement with that 401 K value. That value dropped by 2022, 25%. All right. So what's it doing for you in 2023? And some of you had planned on retiring within a couple of years, but since that value of that 401. K or that retirement account, whatever type it might be dropped, you have had to push that off. So your retirement is no longer going to let's say you were 63, your retirement is not going to be at 65 or you're at 65 and you were going to try to retire at 67. But since those values of your retirement funds dropped by 2,025%, some of you, the conversations that I've had have decided to go ahead and work a couple of years past that age that you were looking at. So again, folks, remember, Smart retirement plan is what we're all about..

Randy Sams:
Our goal, to help you live the retirement you work so hard for....

Randy Sams:
Take those cruises. We want you to live. Retirement like every day is Saturday. Every hour it's every day is happy hour. All right. We want to get you to that point. So let's get together and have a conversation about what you want for your retirement, what your objectives might be for your retirement, what they might look like so we can build a smart plan. And we can assist you in helping to fund that. Remember, you will travel more in your 60s and 70 seconds than you will in your 80s and beyond. Remember, if you listen to the last years, I told you the three phases of retirement, your go go years, your slow go years and your no go years. All right. Your go go years on. This one example is like 60 to 70. Could be 60 to 80. That's where you want to go every day. You want to do stuff and then your slow go years is when you hit that you still can go, but you just don't want to. And then your no go years are basically when you're not leaving the building until you're leaving the building, if you understand what I'm talking about. All right. So if you want to travel abroad during your retirement, we want to make sure that you have a plan that considers your travel plans and how far you want to travel. You want to take a world cruise versus rent an RV and drive to Nashville or go to the Grand Canyon. It's going to make a difference on how we set the retirement funds up. So remember, you don't want to outlive your retirement funds.

Randy Sams:
Okay.

Randy Sams:
You want your funds to outlive you. So we do not want to see your retirement account hit zero before your blood pressure does. So The happiest people in retirement are those that are living within their means and have income sources they can count on. It's called guaranteed lifetime income. Folks, we can help you navigate Social Security pensions for employers. Personal pension plans from annuities and any other retirement income you have. Folks, we're all going we're also going to sit down and talk about long term care, and we're also going to talk about Medicare, Medicare Advantage, Medicare supplements. So there's a lot of things, a lot of topics we're going to spend time with you to talk about smart adjustments. You got to make adjustments, folks. As things change your adjustment, your plan might need to change. So you should have your portfolio and your retirement plan reviewed annually to ensure you are on track to meet your goals and outlive your money. So let me ask you a question. How long's it been since you've heard from your advisor? If you hadn't heard from your advisor lately, or they are telling you just to hang in there. Write it out, folks. Write it out is great when we're young. All right. When we're young. Personal story here. In 2008, I was still working.

Randy Sams:
I was still employed. All right. 2008 hit my 401. Balance went down by, I think, 40%, maybe even more. So a lot of y'all probably did the same thing I did when I got those quarterly statements from my 401. K guess where they went? They went in the drawer. I didn't even open them. All right. So I was young enough, though, in 2008 to where I could I guess I could withstand the 4 or 5, six years that it actually took for the market to recover. And my 401. K value get to the point where it was before 2008. All right. But when you're young, you might be able to withstand those types of drops. You might be able to withstand that. Just hang in there, ride it out. But when you get to the point where you're in retirement or getting close to retirement. You owe it to yourself to sit down with us and see what your plan could be missing. All right. We provide consultations at no cost to our listeners. You know, you can call me (866) 990-7664. Or go to our website YourAmericanRetirement.com . Leave me your information. I'll get in contact with you. Be glad to sit down with you and we'll look at what you have set up and see if there's any adjustments that we can help you make.

Randy Sams:
So remember, reviewing your assets regularly allows you to know when you should rebalance. So over time the performance. It's a different assets can cause a portfolio's allocation to drift away. From how it was originally set. So if you rebalancing. Maybe it helps you retain and maintain your desired level of of diversification and reduce that risk. Okay. So. We need to make sure that we're doing annual reviews. Folks do annual reviews with all my clients, my annuity clients, because as you know, if we're doing an indexed annuity. Some of the index strategies are one year strategies and what we have to do at the end of that one year, we get together and we discuss and look at how that index performed. And if it did great, then we just want it to leave. We want to leave those funds in there. We can do that. Or if we want to reallocate those funds to maybe a different. Index that may have outperformed that certain index. We can do that, but we do that on an annual basis at SMMG Financial. So please give me a call. (866) 990-7664. If you haven't heard from your advisor lately, go to our website YourAmericanRetirement.com . Leave me your information. I'll be glad to set up a free consultation.

Producer:
Need a higher rate of return from your safe money. Listen up. It's time to beat the bank CD rates.

Randy Sams:
One of the things we want to look at, folks, we got beating the bank CDs. How many of you all have money in CDs? What do they call them? Cds, Certificates of depression. I think CDs are paying a little bit more right now today at the banks than they were, say, a year ago just because the interest rates. So we're going to talk about a little thing known as a mega a multi year guaranteed annuity, folks. When I when I give an example. Now listen to what I'm about to say. All right. When I give an example. Plants that I'm talking with. So it's easy for them to understand. And I use the word a fixed rate or a guaranteed annuity or a MIGA, which is a year guaranteed annuity. They can relate. To that to a CD. Now, remember, a CD is offered through the bank. An annuity is not an annuity is an insurance product. All right? It is a risk transfer product. So when I talk about a MIGA. And if I use a CD as an example. The reason I use that is this is they work on the same concept. They're not the same type of product. But if you go down to the bank. And you give your banker. A certain amount of money, $100,000. And you say you can keep this money for one year. How much interest are you going to give me? Guaranteed. And they're going to give you a dollar amount or a percentage amount. All right. Maybe 1%. Maybe 1.5%. All right. If you leave the money in there for two years, it may be 2% or 2.5%. So the same thing works with a mega a multi year guaranteed annuity. All right. You and I will sit down. We'll look at what you have and we'll look at the migas that are available today and that gives us a guaranteed rate of return. All right. There's no if, ands or buts. Your principle is protected and you're guaranteed a interest rate return during that period of time. So here's what happens. So the.

Randy Sams:
Rising interest rate.

Randy Sams:
Present opportunities for conservative investors as interest rates continue to rise. So do rates for bank CDs, but we encourage you to consider an alternative if you're interested in protecting and growing your safe money. Remember part of a safe retirement. Safe money. All right. So CD rates are good right now, but many major rates again, mega, multiyear guaranteed annuity rates are actually more favorable. So this can be particularly beneficial for those looking for higher returns without taking too much risk. Don't consider it to be any risk because you're not going to lose any of your money. All right. But please don't settle for low bank CD rates. Folks, I'm going to give you an example Right now. I have carriers that are offering a three year mega rate. So that means that you we do a contract with that annuity company. The funds are in there for three years right now. The guaranteed rates range from anywhere from just below 5% up to 5.5%. All right. So that money is in there growing guaranteed rate of just under 5%, up to over 5.5%, depending on which carrier we decide to go with. Of course, if you're like me, you're going to say, well, Randy, I want the 5.5%. That makes sense. Five year mega rates right now are a little bit over 5.5%. All right. So you put your money into that mega and you're guaranteed during that three year or that five year period of whatever length of time you choose that you've got that guaranteed rate of return. Now, here's what happens. A lot of times I have clients that are using a mega as an income supplement. What I mean by that is this. If I've got a manga right now that's paying me five and a half or a little bit over 5.5% and I've got a certain dollar amount, I may have a good Social Security benefit coming in.

Randy Sams:
I may have a pension. I'm talking to folks that may have a military pension also on top of a, you know, a company pension. So if you're one of the lucky few who actually have a pension, you may not feel like I need a lot of income, but I could use a little income as a paycheck. A play check. A play check. All right. So here's what you can do. We put that money into the annuity, that mega, that five year mega. And let's say the interest just for simple math is 5.5%. And we switch that. We put you into a mega that allows you to take out those interest payments. All right. So that money is there. And during that five year period, every year with monthly or quarterly or semiannual or annual, they're going to send you a check or they're going to make a deposit for that 5.5%. So if you have $100,000 into an Omega, what's 5.5%? So on an annual basis, you're going to get $5,500. All right. Now, you might just use that. As what? You might just use that as your play check. So folks, it's great to be able to look at Micah's. We can use a Micah to help supplement your income and we can help you protect those funds that are going to be there to make sure you don't outlive your retirement. Hey, we'll be right back. Again, my name is Randy Sams. You're listening to Your American Retirement on 101.1 FM The Answer.

Producer:
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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 . You're listening to Your American Retirement to schedule your free no obligation consultation visit YourAmericanRetirement.com .

Randy Sams:
Hey, welcome back again. My name is Randy Sams. I am your host for Your American Retirement. You're listening to us on 101.1 FM The Answer Where Little Rock Comes to Talk. Folks, again, I want to thank you for joining the show. Hopefully you've taken some good notes and understand why we at SMMG Financial are focused on helping educate our clients to set you up on all the products that are available to set you up for a safe and a secure retirement, not a risky retirement. So, folks, we're going to talk about smart legacy. Okay. What is a legacy? Well, a lot of times, you know, legacy is what I'm going to leave to my family. I'm going to leave it to my spouse. I'm going to leave it to my kids. I'm going to leave a legacy to my grandkids. So planning for the end of your life can often be difficult to discuss. Many of your family members don't want to think about life without you. Well, that's awful good, isn't it? A lot of times it makes me feel better if people are upset, if I'm going to pass away versus if they're happy I'm not around any longer. So anyway, your family doesn't want about life without you, hopefully, and may choose not to make a plan to avoid hard conversations. Folks, I've had those conversations with mom and pops and they want to have the kids there and the kids just get upset because they do not want to think about mom and dad not being in their life. But folks, that's part of part of the planning process. You know, you want to set yourself and your spouse up with that guaranteed lifetime income. And then we want to talk about how can.

Randy Sams:
I get for my kids or grandkids. All right. So the reality.

Randy Sams:
Is that making it for the end of your life.

Randy Sams:
Actually protects your family. The benefits of owning your assets are passed on to loved ones in an efficient manner, said Wills. Retirees can avoid heavy taxes associated with distributing assets after death, such distributed according.

Randy Sams:
To your wishes. This eliminates the possibility of family disputes over who should receive what assets. A lot of times, folks, I will talk to folks about setting up a trust. Okay. I'm not an attorney. I didn't play one on TV and I didn't spend the night at a Holiday Inn Express last night. So I don't give any attorney advice. All right. But you can set up a trust that can designate how you want your assets distributed to your kids, to your family members, which may help family disputes or eliminate family disputes over who should receive what if it's already set in stone? You can provide for your loved ones in the event of your death. So this can provide peace of mind knowing that your entire family be taken care of even after they are gone. Folks, let me just give you a little side note here. All right. You know that what we do at SMMG Financial is we want to sit with people and we want to we want to.

Randy Sams:
Help you spend your money.

Randy Sams:
We want to take off the stress. We want to take away the stress. We want to get you out of those rocking chairs and we want you to join the country club. We want you to play tennis. We want you to play pickleball. We want you to take those cruises. We want you to live life like every day is Saturday. Folks, you've worked too long and too hard not to be able to enjoy your retirement. So listen, when I say this, I want to meet with you and set you up with a retirement plan where we can help you spend your money. Okay. When I say we can help, we're going to help you arrange a plan that helps you spend your money so well. Randy, what if I want to leave something to my kids? We're talking about a legacy. That's where life insurance comes in, folks. Set yourself up with a life insurance program. A life insurance policy. Figure out how many children you have That should be easy or grandkids. You might help with that because a lot of y'all have a lot of grandkids and then determine how much you want to leave each one of those folks. So let's say you have four kids, four children, and you want to leave each one of them $200,000. Then we would look at an $800,000 life insurance policy. All right. We can do a single pay. We can do a ten pay. We can do a we can do a set it up for a second to die. Which means that even though you may pass away first, that plan is still active and it's not going to pay out until your spouse passes away. The second to die policy.

Randy Sams:
All right. So let us set up a plan where we can utilize a life insurance plan, a life insurance policy to leave your kids that inheritance, to leave a legacy via that life insurance policy. Guess what? The benefit to your children are All right. They're each going to get the same amount, but a death benefit is tax free. All right. So let's use a life insurance policy and then let's sit down and figure out how we can put together a plan where you guys can live every day like it's Saturday and not have to worry about spending your money. All right. Wills and trust a will and a trust. Our legal documents that are used to manage a person's assets after their death, but they serve different purposes and have some key differences. A will is a legal document that outlines how a person's assets should be divided upon their death. Folks, if you all ever heard of families having disputes over wills or having disputes over the estate because the person who just passed away did not have a will. It happens every day. It amazes me. Folks, you can write a will. You can write it down on a piece of paper. All right. You can go to Google and you can Google make a will and you can set yourself up with a will. All right. Leave it with an attorney. Have an attorney. Set it up for you. Whatever you want to do. But you need to have a will, because without a will, your family does not know how you want your assets distributed. All right. Especially if you're the second spouse. So if you're a husband and wife and the husband is passed.

Randy Sams:
Away and all the.

Randy Sams:
Assets have been passed to the wife and then mom has passed away without a will, what happens to the estate? That's when we see a lot of issues, family disputes about who gets what. I deserve this. You don't deserve anything. Anyway, let's take those off the table, set up a will and make your wishes known. A trust is an arrangement that allows a person. To transfer their assets to a trustee during their lifetime. The trustee is then responsible for managing the assets and distributing them to beneficiaries named in the trust folks. Do you know what? Excuse me.

Randy Sams:
I have set up.

Randy Sams:
Annuity.

Randy Sams:
Plans.

Randy Sams:
For my clients and they have a family trust set up. And we allow the trust to be or they set the trust up to be the owner beneficiary of that annuity. All right. Nine times out of ten, they set the trust up as being the beneficiary. What does that mean? That means that they may have a certain dollar amount that they want to leave as a legacy. But instead of having the family members, having to decide what dad or mom or mom or dad, you know, wanted each one of us to have. They set up a trust.

Randy Sams:
We put the annuity in place.

Randy Sams:
Said the trust as the beneficiary. And inside the trust they have designated how they want those funds distributed to the kids or grandkids. Okay, so you can have that trust set up with that and that annuity can be paid to that. A death benefit can be paid to the trust. All right. So remember, it allows the person to transfer their assets to a trustee during their lifetime, and then the trustee is then responsible for managing the assets and distributing them to beneficiaries named in the trust. So you want all the argument off the table. Set yourself up a will set yourself up a trust. Leave funds in the trust and have the trustee by your wishes designated on how I want those funds distributed. All right. Our two big tips for planning your legacy. Number one, again, you just heard me have a will. Don't leave your legacy in the hands of the courts or in the state called probate. Make your last will clear so your family doesn't have to bear any additional burden after you pass away. Have a Roth IRA. Funds within a Roth will pass to your beneficiaries tax free, and any growth within that Roth is tax free as well. Don't let your in your family inherit a tax bomb. All right. So now what about a Roth IRA? So, Randy.

Randy Sams:
Roth IRAs. You have tax free withdrawals. You have no age limit on the contributions. You have no required minimum distributions. If you remember the first of the show we talked about, a listener had a question on their RMDs because of the new Secure Act 2.0 that took effect in January 2023. So no required minimum distributions, unlike an IRA or 401 K at age 73. Okay. Potential for compound growth. You have some flexibility. And what I want to talk about now is Roth conversion. So folks, here's what I do a lot of times with folks. Let's say you have your you're still working, you have a 401. K balance and you want to take advantage of what we state. And it's known as an in-service distribution. That means when you hit age 59.5. All right. Remember, if you withdraw funds from a 401. K, except on special circumstances, but most of the time, if you're 57 years old and you start taking money out of your 401. K just because you need to buy a new truck or whatever happens may be. You will be penalized. All right. But once you hit 59.5 for any qualified plans that you might have, 400, three, 401. Iras, you can put those money, those monies into an annuity. Now, Randy, why would I want to do that? Well, if we're going to talk about setting up a Roth IRA, and let's say you have 200,000 in your 401.

Randy Sams:
K and you want to do a Roth. If you take that full 200,000 out this year, in 2023, you're going to be responsible for the tax burden on the full 200,000. Is that correct? So what's that's going to do? Number one, probably it's going to put you in a much higher tax bracket. Right. So here's what we do. We set the annuity up, put it into an annuity that allows us to make those withdrawals over a ten year period at 10%. So every year we'll be drawing 10% of that 200,000. We're paying the taxes on 20,000 over that ten year period. At the end of ten years, we've fully converted that 200,000 over to a Roth IRA. Okay, So folks, listen. We are experts on retirement planning. We would love to give you a free no obligation consultation, so please give me a call. (866) 990-7664. Or go to YourAmericanRetirement.com and leave us your contact information. We'd love to get in contact with you and set up a free no obligation consultation. My name is Randy Sams. I want to thank you for joining me this Saturday morning. You're listening to Your American Retirement on 101.1 FM The Answer Have a great Saturday.

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.

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