When It Comes to Your Money: Get More in 2024!

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

Speaker1:
Any examples used are for illustrative purposes only, and do not take into account your particular investment objectives, financial situation or needs and may not be suitable for all investors. It is not intended to predict the performance of any specific investment, and is not a solicitation or recommendation of any investment strategy.

Speaker2:
Welcome to your American Retirement with your host, Randy Sams. Get set for a full hour of financial information and economic news affecting your bottom line. Randy works hard each day to educate Americans like you on how to reach the financial freedom they've worked so hard for, and he can help you too. So now let's start the show. Here is your host, Randy Sams. Hello again, Central Arkansas. I want to welcome you to your American retirement. I want to thank you for joining me this morning. On this Saturday morning. I hope you've had your cup of coffee. One cup, two cup, three cup, whatever it takes you to get going. But again, we have a jam packed show for you guys on tap today. So again thank you for joining. And hey, we always have to remind you, don't forget to check out the show in podcast form on your Apple or Google or Spotify or wherever you might get your podcasts. And also you can visit our YouTube page, go to youtube.com and search your American retirement. You know you hit the right spot when you see my smiling face. Alright guys. Hey look, listen, I want to give a shout out to all my friends and family that are listening in Benton, Arkansas. Oh, I can't forget Bryant. Haskell, you know, all Saline County. I hope you guys are are doing well. And plus, let me give myself a plug.

Speaker2:
I am running for justice of the Peace in Saline County District nine. So if you're in district nine, I would appreciate your vote. I'll thank you for joining me this morning for your for your American retirement. But also if you're able to go out and vote again, all listeners. Early voting begins February 20th. Okay. February 19th is a Monday. It is a holiday. So early voting starts February 20th, runs through March 4th, and then the actual primary election day is March 5th. So again, I would appreciate all my listeners that are in Saline County District nine, if you'd give me a check mark beside my name. Anyway, listen, our podcast will give you the different episodes that you can look at. You can, you can listen to if you go to youtube.com, you're going to see a little snippet of today's show or previous shows. We don't put the entire show on YouTube. Uh, you can go to get that. And just going to show you just a little bit about what's going on in the show and hopefully pique your interest to go to your podcast provider or go to the website, your American retirement.com, look up any previous program that we've had over the last couple of years, and you'll be able to listen to the entire show. Okay. But again, please. Don't hesitate to give us a call. Please reach out and contact us. Let me know what it is that you have a concern about.

Speaker2:
If you're getting close to retirement or you're in retirement and you've got some things that are bothering you, some things that you're thinking about, and you want to try to get together with somebody, folks, that doesn't cost you a dime to take advantage of what we do at Qmg financial. Okay. We love to listen to. All our listeners when they call in and leave us a little snippet of, hey, the show was great. Uh, like for you to maybe cover this subject here in the near future. And that's what we do. We put together the shows based on what some of our input from the clients have been, or our listeners have been. So again, a lot of people have asked, Randy, you know, you've been doing this for a couple of years. Uh, some people don't last this long. Why why is it what is it that you like to do about the show? Why is it that we host the show each week? Well, that's a good question. Number one, the show is for you. Okay, so if this is your first time listening to your American retirement. I want to talk a moment about why we are here, why I do what I do, and why we're broadcasting in central Arkansas. Okay. Number one, we want to educate retirees and pre-retirees. You know what our mission is? We are all about educating our clients.

Speaker2:
The folks that we meet with. We are all about educating, getting you aware of what can happen in retirement, the risk that will probably occur during retirement. And we want to set you up for a safe and a secure retirement, not a risky retirement. So. By providing valuable information like we do on this show, and insights help make you or help making an informed decision for our clients. We help you make an informed decision about your financial future. That's what we're all about, okay? We understand that knowledge is power, and we don't want our listeners or clients to ever feel powerless in retirement. That's why we want to meet. That's why we want to have a discussion, free consultation. And let's look at what some of your concerns are. Let's figure out what the biggest risk for you and your spouse might be during retirement. Okay. So again this also includes staying current with the latest developments, trends and best practices in retirement planning. Because the financial world, as you know, keeps moving. Guys there are new products to going out today that we didn't have last year. We did definitely didn't have three or 4 or 5 years ago. Okay. We want our listeners to understand, and we don't want you to be left behind by some new product or some new theory or something that may be on the horizon that we see that could possibly happen.

Speaker2:
We want to set you up, remember, for a safe and a secure retirement, not a risky retirement. Number two reason why we do what we do. We want to address retirement challenges that retirees and pre-retirees often encounter while offering smart strategies and solutions to help navigate these obstacles. Okay, again, you heard me say this earlier. What is it that keeps you up at night? If you're getting close to retirement and your retirement window may be five years, ten years down the road? And that's okay, because we need to start thinking about retirement today, okay? If you're going to retire next month or you're going to retire next year, that's cutting it pretty close as far as I'm concerned. All right. We need to start thinking about hey, Randy, uh, just turned 60. I'm going to retire at age 68. That's my target date. What can we put together right now that's going to help our position, myself and my spouse's position in seven years or eight years or nine years, that's what we like to do, okay. Because remember, we're all going to face the number one risk in retirement. That's called longevity risk, the risk of outliving your money. And we want to be able to address that risk with you. Look at what your wants and your objectives are. And we take a longevity risk very very serious okay.

Speaker2:
We don't want to set you up with a retirement plan that's good to age 8585 or age 90. We want to set you up with a retirement program that's good for as long as you live, and then set it up for as long as your spouse lives. Also, number three, why do we do what we do? Why do we host this show every week? We want to empower smart financial decision making by sharing our knowledge. Now, folks, I've been in the business for 38 years and our expertise, as well as examples of how we are helping listeners and clients every week. Okay, not every time that I do this, but from from time to time on, on some of the shows, I've given examples of, you know, some of the things that we've done because, folks, I don't have a one size fits all program, okay, this is not what we did for this client last week, and we're going to do for the same client next week. We want to sit down and listen to what your objectives are, what you and your spouse's projectives are. Objectives are what your wants, what your needs are. During retirement. And then let's put together a plan together based on your wants and your objectives. Not the same, same plan and objective that we did last week with somebody else. Okay. It's not a one size fits all. So. You know, like when? When should I take Social Security? Do I? Am I going to be able to retire with enough income? Those are things that we have to talk about.

Speaker2:
Whenever we set up our meeting and we talk and we have a discussion. So number four, we want to promote financial literacy. Because so many people feel like financial freedom is simply breech. We are here to answer your questions and help you understand what you need to do in order to reach your own retirement goals. Folks, that's what I love, that, okay? That's why we do what we do. You you're you know, you you. I don't talk about product. I don't talk a lot of times about certain annuities with certain companies or whatever. We talk about concepts. You know, I do talk a lot about income because that's that's my mainstay. I believe you retire on income, not assets. It's great to have assets, but assets can be lost, folks. I've yet to meet someone that's in retirement or someone that's getting close to retirement where they don't. Have a concern about having enough income. Okay? Remember, you retire on income, not assets. We can use those assets to set you up with a guaranteed income. And then number five, we want to serve as your trusted guide. So we are your resource. We hope that we're your resource for any questions and helping you manage the complexities and preparing for and thriving in retirement.

Speaker2:
So. Folks. That's why we love doing this show. Okay, I'm we're going on two years now. I've gotten many, many, many, many, uh, phone calls. Uh. What can I say? Compliments about the show. About how it's helped you, uh, figure out some of the questions that you've had. Maybe it was a concern that you had, and you listened to the show, and you got that concern taken care of. You may have called me and we've had a discussion, but folks, that's why we love doing the show. So listen again, I set this up. We've got a great show we're going to talk about. We're going to when you come back from this break coming up, we're going to set this thing up. We've got our financial quote of the week, alright, financial quote of the week. And then also we have four tips to boost your savings. And segment two. All right. So when we come back we're going to be talking about the four tips to boost your savings. But we're going to start all that off with the financial quote of the week. So again you're listening to your American retirement I am Randy Sams. I am your host. I will continue to be your host as long as they let me on this radio station 101.1 FM. The answer. So folks, we're going to be right back. Thanks for listening.

Speaker3:
Thanks for listening to your American Retirement. If you like what you're hearing, subscribe to our YouTube channel to watch videos from this program and other recent episodes.

Driving tonight on a plane.

Speaker3:
Visit your American retirement.com to schedule a free consultation with Randy today. And now back to the show.

Speaker2:
Welcome back to your American retirement on 101.1 FM. The answer where little Rock comes to talk. Folks, don't forget to check out our YouTube page, visit youtube.com, and search for Your American Retirement again. You'll know you hit the right spot when you see my smiling face. All right, folks, listen, you know what? I think it's time for a little financial wisdom, Mr. Jim. What do you think? So how about let's key tune up that financial wisdom quote of the week music and let's get her on.

Speaker4:
And now for some financial wisdom. It's time for the quote of the week.

Speaker2:
All right. This week's financial quote of the week. More people should learn to tell their dollars where to go instead of asking them where they went. I like that one. Okay, y'all know to write that down, more people should learn to tell their dollars where to go instead of asking them where they went. I have a lot of times when I meet with folks in retirement planning when it comes to retirement, they realize they haven't saved enough. We'll talk about that in a little bit going on in this show. But anyway, this week's financial quote of the week is given to us by Robert Roger Babson. Uh, he was an American entrepreneur, economist, and business theorist. In the first half of the 20th century. So Mister Roger Babson is best remembered by founding a college named after him, Babson College. So that is our financial wisdom quote of the week. So I don't want you asking, where did your money go? We want to get you set up where you know where you are sitting, and you've got a good target. All right. You got a target in, in, in your sights that, you know, when your retirement age is going to be and you already know what you're going to be retired on. As far as guaranteed income, folks, it's all about guarantees. You know, you've listened to this show over and over and over and you've heard me talk about guarantees. Okay, do you want a what if or do you want a sure thing? All right.

Speaker2:
Now we have Oaklawn racetrack that is, um, open I think it opened last month. And you can go down there and bet on the ponies. All right. Now some people are going to come up to you and say, hey, man, I got a tip. Okay. Is it a sure thing? No. You know how the races are horse races. Have you ever been there? But most people that I talk to and I ask them that question, are you more apt to take advantage of a sure thing? Or what if most people choose the sure thing? All right. That's why I am so adamant about setting my clients up with guaranteed income. It's a sure thing. So even if we were drawing a retirement plan up for eight years or ten years out in the future. I can tell you today exactly what income you're going to get, what you're going to retire on. Okay. There's too many programs out there that are going to allow us to do that. We should know what your Social Security is going to be just by the reports that you get from Social Security. All right. But I could go on and on about that. But listen, we're going to get into the next segment here. Many people that I deal with are getting close to retirement. So listen to this. Here are four tips to boost your savings.

Speaker2:
Gotta have that for retirement. You got to be able to have more than just one method of savings. Okay, four tips to boost your savings. So saving and investing for retirement is crucial. No matter your age. But as you get closer to your golden years, it's even more important to make sure you have enough set aside to live the lifestyle you expect, the lifestyle you would love to have. Okay, for those who are getting close to retirement but aren't quite in the retirement red zone just yet, remember that red zone five years before five years into. Here are some steps to take if you need to generate extra funds. Number one understand cash flow and be willing to adjust at any age. It's important to assess what goes to fixed spending monthly expenses such as mortgage bills or basic living expenses. Folks, that's what we want to address when we meet basic living expenses. We want to address those first. Okay. And we got to compare with typical discretionary spending. Those are what we call wants. You want to travel. You want to join the country club whatever it happens to be, because this helps you get a handle on spending and saving habits, and puts a spotlight on excess cash that could likely shift from the discretionary bucket into the retirement savings bucket. So, folks, when we meet, we're going to talk about your needs. Those are your basic expenses.

Speaker2:
And then we're going to talk about your wants okay. And depending on what your wants are some people are just happy in retirement. You know maybe you want to get your mortgage paid off. We got to focus on getting the mortgage paid off during retirement or even before retirement. Okay. You want to travel. That's going to be a want. But we got to be specific. As far as what do you mean by travel? Do you want to travel the state of Arkansas? Do you want to travel the United States? Do you want to travel the world? Different financial outlay on those, am I correct? Yes. So we got to look at your needs, your basic expenses. And then we're going to look at your wants and put together a program for it. Because remember, as you get closer to retirement, it may be time to double down on spending and saving habits. All right. For example. For a lot of empty nesters, it may make financial sense to downsize. A home a few years before entering retirement to provide a cushion of additional assets. You might even consider relocating to a cheaper housing market, so in some instances it could potentially unlock assets in the home equity, further aiding in retirement readiness. Now, I see a lot of times, you know, people have, uh, been living in their houses for 30 years, 40 years even. And when they bought the house 30 years ago or 40 years ago, they paid a certain dollar amount.

Speaker2:
Well, because of the value of real estate, you know, boom, exploding. Just think of the equity that they have in that house, okay? So they could take that equity, maybe buy a smaller house, relocate into a into a lower housing market, and then you have the extra money from your equity. Don't spend it all on another house. Put some of it away and then you have a mortgage free house. Okay. But we got to look at understanding your cash flow and be willing to make adjustments. Number two, make small yet meaningful increases. So Vanguard's annual How America Saves report recently highlighted that in 2022, nearly a quarter of workers saved at least 10% of their income. I'd like for that number to be higher, but it says a quarter of workers saved at least 10% of their income, and the average deferral rate remained at a historic high of 7.4%. So, combined with an employer contribution, the total average contribution was 11.3%. In other words, the employees picking back 7.4%. The employer is matching up to a certain percent, which when you add those together, the total average contribution is about 11.3%. Many Americans are on a solid track, but there's still work to do. Okay, so again, people ask me, Randy, is it is it worth me investing in the 401 K? I always say you never pass up free money. And what I mean by free money is this if you have a 401 K available through your employer and they have a matching contribution, they're going to match up to a certain percentage.

Speaker2:
Okay. So let's say they match up to 3%. Why? You know, if you do 3%, they'll match up to 3%. If you do five, they're going to match three. If you do two, they're going to do two. So why not at least take advantage of that 3% that they're going to match? You do three. Let them do three. That's 6% you're putting back. But then if you can do ten and they do three, now you're putting back 13. See how that works. So I'm a big believer in free money. And then at a certain point in time down the future, when you can move that money out of a risky 401 K, whatever your investments might be inside your 401 K, that's when we want to talk about moving that money into maybe an income annuity, a guaranteed income annuity. Okay. So here, if possible, save 12 to 15% of your income towards retirement savings. Aim to increase your 401 K contributions by 1% each year, or make it a personal mandate to boost contributions every time you get a raise. I like that one. While these minimal changes may not feel significant today on the front end, the power of compound interest will pay off big time over the long term.

Speaker2:
So when an individual is about a decade outside of retirement, they should aim to contribute the highest amount possible to retirement accounts. Okay, now folks, when you hit 59.5 and you're still working and you have a 401 K or a 403 B, or whatever your plan might be, or an IRA. There's a process called inservice distribution, which means that we can take a percentage of your 401 K balance. You can take it all if you want, but let's just use a percentage, say 50% of it, and move that money into a guaranteed income annuity. Now why do I do that? Why do I talk about this? Because I have a guaranteed income annuities right now. Today, as you're listening to this show that guarantee me and you an 8% compound interest for the next ten years. Okay. So if you put 200,000 into the guaranteed income annuity, guaranteed compound interest of 8% at the end of ten years, your 200,000 is guaranteed to more than double. All right. It's going to be around 425,000 somewhere in that range. And did that math very quickly in my head. So if you want to get specific, you can call me and I'll do that. But at 8% interest guaranteed for ten years, that's hard to beat. And then if you took 50%, you've still got 50% left in your 401 K. You continue to work, you continue to make your contributions, your employer continue to match your contributions, and you've got the best of both worlds, okay.

Speaker2:
So make small meaningful increases. All right. So I love that in-service distribution feature because of the fact that a lot of people are not aware of, I had someone the other day talk about they said, well, Randy, I'll get penalized if I take money out of my 401 K. And I said, well, how old are you? Well, they're 60, just turned 60 years old. And when I told them about the in-service distributions, guess what? Their eyes lit up because they like that idea of being able to. They worked really hard. They've got a good amount of money in their 401 K. They don't want to keep it in a risky investment as far as indexes or stock, you know, bonds or whatever. And they wanted to take part of their money. I think we did about 60% of their 401 K and move that into a guaranteed income annuity, where they had the peace of mind, knowing that no matter what the stock market did, their money was growing at 8% compound interest for the next ten years. So, folks, listen, we've still got number three and number four to cover. So I want you to come right back because we're going to talk about catching up the consider catch up contributions. And don't let market volatility scare you. We're going to be right back. You're listening to your American retirement.

Speaker3:
You're listening to your American retirement. To schedule your free no obligation consultation visit your American retirement.com.

Let's sit together.

Speaker1:
Do you want a steady stream of income for retirement? Then it's time to consider annuities. I'm Matt McClure with the Retirement Radio Network powered by Amara Life. Gone are the days when most employers offered pensions with guaranteed lifetime payouts to their workers. But what if I told you that you can build your own personal pension? It's possible with an annuity. An annuity is a financial product that provides a series of regular payments to an individual over a specified period of time, often for the rest of their life. There are several.

Speaker5:
Options for you to consider when choosing an annuity. Be confident in knowing that there is an annuity out there that can meet all of your needs.

Speaker1:
Ford Stokes is founder and president of Active Wealth Management and author of the book annuity 360. There are several different types of annuities, including fixed, variable, and fixed indexed.

Speaker5:
A fixed annuity offers a specific guaranteed interest rate on their contributions to the account. A fixed indexed annuity is an accumulation based product offered by an insurance company. The growth of your fixed indexed annuity is dependent on the performance of a chosen stock market index, but your money is not actually invested in this index. This offers you great growth potential and exceptional protection for your investment.

Speaker1:
While each can provide tax deferred growth and a lifetime income stream, variable annuities put your principal at risk in the market.

Speaker5:
If you are currently investing in a variable annuity, your funds could be in serious trouble if the market experienced any downturns.

Speaker1:
With so many possible choices to consider, it's essential you speak to a financial advisor or professional to help you make the best decision for your future. So are you ready to consider an annuity as part of your retirement plan? It's a key question to consider as you approach what should be your golden years with the Retirement Radio Network powered by Amira Life? I'm Matt McClure. Fixed annuities, including multiyear guaranteed rate annuities, are not designed for short term investments and may be subject to restrictions, fees and surrender charges as described in the annuity contract. Guarantees are backed by the financial strength and claims paying ability of the issuer.

Speaker3:
Are you interested in ways to protect and grow your hard earned money? Your American retirement is here to help. Here's Randy Sams.

Speaker2:
Hey, thanks for joining us on this week's edition of Your American Retirement. So please be sure to check out the podcast version of the show on Apple, Google, Spotify, or wherever you get your podcasts. So, folks, let's finish up the four tips to boost your savings. Number three, consider catch up contributions. Now, folks, if we have time in the next segment, we're going to talk about this a little bit more in depth. Um, because a lot of people don't understand when you hit age 50, there are some things that you can do to really supercharge your retirement plans. Okay. So but listen, consider catch up contributions intended to help investors who are aged 50 and older. Catch up contributions are offered in eligible retirement vehicles such as IRAs 401 S, simple IRAs, simple 401 S for those who need to make up for missed investment opportunities, and if the extra savings effort is within your budget, catch up contributions can ultimately bolster savings efforts. In other words, it'll supercharge your savings effort. It'll supercharge your retirement planning. So in 2024, as an example, the standard annual IRA contribution limit now this is for an IRA is $7,000. But those age 50 and older can make a catch up contribution of an additional $1,000. Now folks that can change every year. It may stay the same, but you just think about it. If you're 50 and you can add an additional $1,000 over the next ten years when you hit 60.

Speaker2:
And again, that could go up. Like I said, when it says $1,000, that doesn't mean it's locked in at 1000 forever. That's just what it is for 2024. But that's an additional $10,000 that you've put into your IRA account. But remember, you've got the magic of compound interest. All right. One of the greatest wonders of the world is compound interest. That's how you can take a little a small amount today, and it can grow into a huge amount many years from now. Okay. But that's what we want to do. As an example, 401 K. Your maximum contribution for 2024 on a 401 K is 23,000. But if you're age 50 and older, you can contribute your catch up contribution. 400 401 K is $7,500, which means you can put a total of $30,500 into your 401 K. Okay, now that makes a big, big, big difference. You do 7500 over ten year period, 75,000 plus the magic of compound interest over that time. Now you see how this works. So that catch up contribution will help you supercharge your retirement plan. Something you got to think about. And that's why I want to spend a little bit more time, maybe in one of the this next segment after we get through. All right. Number four. Don't let market volatility scare you now, folks. That's one of the risks that we address when we sit down and we have our free consultation with you okay.

Speaker2:
We're going to talk about longevity risk. Yes. We're going to talk about long term care risk. We're going to talk about market volatility. Wouldn't it be great if the market just stayed and just continued to go up. But as you know, over the past 3 or 4 years, you've had the ups and you've had the downs, probably had more downs than we've had up right now. We're going a little bit up, but what's going to happen 2022. It was down 2023. It started making a little bit up, but it was still down overall from when compared to 2022 2024. We have some good increases going on. We hope it stays that way. Okay, but listen, don't let your emotions get the best of you and aim to never abandon a long term retirement savings plan. Market volatility will always be present, but it's incumbent on long term investors to weather the storm. Now, this can be difficult to remember if market is wreaking havoc on a portfolio as you get closer to retirement. Remember that retirement red zone five years before five years into retirement? For those within a 10 to 15 year window, this is where a trusted financial advisor or retirement planner can come into play, as we can help assess and reevaluate your financial plan. Okay, listen, we got to be able to remind investors to stay the course and stick the design plan, stick to the design plan that was built alongside their trusted guidance.

Speaker2:
Now, guys, you know, one of the things that I do at SMC financial is we are going to address market volatility risk, okay. I want to help you avoid that as much as possible. So you ask Randy how do we do that. Well, we just talked about it a little while ago about the in-service distribution. You've been working with your employer. He has a 401 K. You've been doing your maximum contributions. You're now 59.5. And you want to take that volatility because you've over the time you've been working, you've seen those big ups in the 401 K. And you've seen those big drops in 401 K. Folks, I can tell you all the horror stories about 2008. I didn't even want to look at my 401 k balance at that time, because it had dropped by 35, I think 3,540%. But if you're young enough, you can kind of overcome some of that. But here's how we address it. Here's how I help you avoid market volatility. We're going to take a percentage of your 401 K plan or your 403 B or your IRA. And we're going to take that market volatility risk off the table. How. We're going to put it into an annuity. Hopefully it will be a guaranteed lifetime income annuity for you because it doesn't matter what the market does.

Speaker2:
Remember what I just said. We can take that money you've had in the 401 K. Put that in into a guaranteed income annuity growing at 8%. Compound interest guaranteed for the next ten years. You've got the peace of mind knowing that that amount of money that you put into that annuity is going to be growing, no matter what the stock market does. You can let the stock market in your in your other 401 K balance. If you took 50% and left 50% in your 401 K, then you got to deal with the volatility there. But we're just talking about a small amount of your 401 K taking that market volatility away from that, taking that risk away and putting that into a guaranteed income annuity. All right. So folks if you haven't heard from your advisor lately please talk to us and get a second opinion. So we love to help you. We would love to help you set the path to retirement you've always envisioned for yourself and your family. All right. Now let's go right into ten ways to improve your finances in 2024. All right, ten ways. To improve your finances in 2024. Because folks, when it comes to improving your financial situation, the most important step is getting started. Remember that. When's the best time to start? Right now.

Speaker2:
Here are ten concrete steps you can take to get more in 2024. So let's look at short term first okay. Short term financial goals achievable within a year. We're going to perform a financial checkup to review the past year and set goals for the current year. We're going to check your credit score, pull free credit reports for the accuracy and planning purposes. All right. Number three, create a timeline for goals, balancing competing objectives and prioritizing based on available income. What is it that you have that we can work with to set your plan in action for you? All right, again, maybe a five year window, maybe a ten year window. But we're going to see what you have to work with. And then that's what we're going to use to set the plan up. Number four, reconfigure your budget by reviewing expenses, aligning spending with values, and identifying areas to cut expenses. You know, we just spent a little time there about four ways to boost your savings. And one of the things we looked at was reviewing your expenses. What do you have going out versus what you have coming in? And then number five, for a short short term financial goals review and adjust investment strategy at least once a year to align with goals, risk tolerance and time horizon. Okay, now long term financial goals. Again, we're talking ten ways to improve your finances in 2024.

Speaker2:
We just looked at five short term financial goals. Let's look at five long term financial goals. Let's build an emergency fund over time by automating monthly savings into a high yield savings account. Savings accounts are doing pretty well right now the interest that they're offering. So take advantage of that. Number two, increase retirement savings by adjusting monthly contributions to IRAs 401 as workplace retirement plans or fixed indexed annuities. Number three prioritize paying down debts, particularly credit card debt, with regular payments to save on interest. Now, folks, you know, if you've had a meeting with me and we talk about credit credit cards, I am not against you having a credit card as long as you use it wisely. Okay? A lot of people that I know and I have no issues with this whatsoever. They're using their credit card to pay their bills, but the reason they're using it to pay their bills is because at the end of the month, they pay it off. But a lot of credit card companies today offer you what rewards program. So they're taking the money that they would have spent anyway, putting it on the credit card. And at the end of the month they pay that credit card off. So they have a zero balance. So they're not getting dinged with that huge, exorbitant interest rate. Okay. That's using a credit card wisely. Sometimes you have to use them for emergencies, and I understand that.

Speaker2:
But I don't have anything against you having a credit card as long as we use it wisely. All right. Number four increase earning potential by exploring new job opportunities or side income, updating LinkedIn profiles, and gaining more skills. Folks, you should always be learning, okay? New job opportunities. Is there an opportunity for you to take on a new job, a new opportunity? You look back at your experience and you say, hey, maybe the people I'm working with don't appreciate me as much as I feel like they should. Okay, there may be other opportunities you don't know. You don't know until you look right. I had someone the other day that I was talking with. And and and they were looking for a job. And one of the things that I kept telling them was this okay, because they kept looking at what their experience was, what their experience was. And I kept telling them, folks, you you got to be able to sit down. When you go to a job interview, your first sale has got to be yourself, okay? Don't be don't be worried about what you used to do. Be able to sell yourself in the fact that, hey, I'm going to be here for you. I'm going to do what you want me to do, and I'm going to learn. All right. But always be open to maybe new job opportunities up.

Speaker2:
Keep your LinkedIn profile updated as far as if you've changed jobs or whatever, and then always be looking to increase the skill level that makes you more valuable to your current employer. Also, number five identify personal financial priorities such as saving for a down payment or building an education fund for your children or grandkids. Okay, a lot of us grandparents out there, we love our grandkids. We love our kids also, but we love our grandkids. And we think about, you know what? What's college going to cost in 15 years from now or 12 years from now, or ten years from now or five years from now, whatever. But if you've got your financial priorities, you've got them set correctly. You can start saving for a down payment, maybe a house or for educational fund for your children. Okay, so look, leverage technology, leverage your systems and automation for financial task and save time and energy. Utilize budgeting. Budgeting apps, automated savings financial advisors as supplementary tools to improve finances. Bottom line folks speak to an experienced financial advisor, i.e. retirement planner, and build a plan that's tailored for you. So folks, listen, I want you to come right back because we're going to jump into a little bit more information about those catch up contributions, how they can benefit you. If you're 50 years old or older, you're listening to your American retirement will be right back.

Speaker3:
Miss part of today's show. Your American Retirement is available wherever you listen to podcasts and online at your American retirement.com.

Speaker6:
Do you think I'm such a fool to believe everything you say is true? That just goes to show. That you really don't know why you're out painting the town. Do you think I'm home? Just sitting.

Speaker3:
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 your American retirement.com. 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.

Speaker2:
You're listening to your American Retirement. Please join me every Saturday at 10 a.m. right here on 101.1 FM. The answer where little Rock comes to talk. Well, folks, you know, earlier in today's show, we spoke about four ways to to boost your savings in retirement or set you up for retirement. And one of the things we spoke about was what's known as a catch up contribution. Um, a lot of clients that that we deal with, a lot of questions that we deal with whenever folks call in and we talk about a 401 K, and a lot of folks aren't aware of the ability to be putting more because especially folks. Listen, I know when I deal with folks that a lot of people are maxed out on their 401 K, again, the max contribution for 2024 on a 401 K, remember what I said was 23,000. So a lot of you may have your 401 K maxed out. But the good news is if you're 50 years or older, they're going to allow you to do what's known as a catch up contribution. Why is it called a catch up contribution? I'm glad you asked. So listen, what are catch up contributions and how do they work? So if you're listening today and you're 50 years or older, you can supersize your contributions. I call them supercharge your contributions to your retirement accounts because starting at age 50, workers can supersede the mandated limits with what are known as catch up contributions.

Speaker2:
That's catch up, not catch up. Catch up. Okay, how much more you can contribute varies on the type of account and regulations that are regularly updated by the IRS, meaning what it is this year may not be the same as next year. It may increase. Okay, so if you hit the half century mark and want to squirrel away more money, catch up contributions can help. And here's what you need to know about those. So what are catch up contributions? They were introduced by President George W Bush in 2001. W 2001 catch up contributions allow employees age 50 and older to make additional deposits into their tax advantaged retirement savings accounts, so catch up contributions may be made to a 401 K plan, 403 B plan A government 457 b plan A traditional or a Roth IRA, a Sarsat Sep s a r Sep a simple 401 k or a simple IRA. Okay, I'm not going to go into each one of those. You know what a 400 1KA, 403 B and IRAs are anyway, okay. But the dollar amount that you can contribute depends on the kind of account. And that fluctuates with inflation, though that amount may not change every year okay. So it may not change. It may be the same. The limit on the catch up contributions for 401 K plans for 2024, as an example, is an additional $7,500, the same as it was in 2023.

Speaker2:
So see, it didn't change. It stayed level for your 401 K. So so the maximum standard contribution on 401 K plans in 2024 is 23,000, meaning that employees 50 years of age or older can take advantage or take an advantage of catch up. Contributions can contribute up to $30,500. Now, folks, I want to I want to expand on that. That's $7,500 additional that you can add. And I'm just using a ten year period from 50 to 60. Okay. You I mean, you don't have to stop at 60. I'm just using 60 as a target. Okay. But over that ten year period and that's just keeping that catch up contribution level at $7,500. It probably will increase over the next ten years. Okay. But as an example, last year's amount was in 2023 was $7,500. This year's amount is the same $7,500. But you got to realize you're taking that additional $7,500 each year over ten year period is an additional $75,000. And when you use the magic and the power of compound interest, that's $75,000 can turn into a lot, a lot of money. Okay, just the $30,500 over a ten year period, folks. That's over 300,000. How many of you today can raise your hand up listening to the show that says, I wish my 401 K balance your age 60 or 60 1 or 62. How many of you would like to say, I wish my 41K balance was three over $300,000? Okay.

Speaker2:
You see how that can help? That's why you need to be able to work with folks like myself at Qmg Financial that understand, hey, if you're working and you've maxed out your 401 K, but you're 50 years old or 52 years old, have you ever thought about doing a catch up contribution? And they go, what is that, Randy? That's what we're talking about. Okay, so here's how catch up contributions work. For the most part, employees may begin making catch up contributions starting January 1st of the year. They turn 50. That makes sense. So what if you turn 50 in October? The rule says you can start making those catch up contributions starting January 1st of the year. You turn 50. Okay, so if you turn 50 in September of 2024, you could be doing the additional 7500 into your 401 K right now as of January 1st, 2024. Okay. Certain plans may have unique allowances. However, some 403 B's. Up, for example, allow employees who have been with the same company for at least 15 years to increase their contribution limit before turning age 50. So we have to be aware of what type of plan you have, and then sometimes we have to look and do a review of the plan documents. Okay. But here are some of the contribution limits for 2020 for. A retirement plan may have different contribution limits as well, so it's important to see which can apply to you.

Speaker2:
Which plan do you have. So these are your 2024 catch up contributions. So again if you have a 401 K, your 2024 contribution limit for an individual is $24,000, $23,000. I said 24 just went right into it. 23,000 is the Max 401 K benefit or contribution. You can make. Your catch up contribution limit is 7500. Now folks, you don't have to do 7500, but that's what you can max out okay. So if you can do an additional 2000 or 3000 or whatever that might be, take advantage of it. Your age 50, it's legal. You can bypass that 23,000 and put more money into it, up to $30,500. And again, like I said, you do that over a ten year period. Just no growth at all is 30 is over 300,000. All right. So let's look at an IRA. This is a Roth IRA or a traditional IRA. Your 2024 contribution Max for an individual for an IRA either Roth or individual is $7,000. Your catch up contribution for the individual is 1000, which means that your total contributions, your limit for age is 50 or above is $8,000. For three b, it's the same as a 401 K your 457 B's are the same. The 2024 contribution max for those two types of plans is 23,000. Your catch up contribution limit is 7500, which makes your total contribution including the catch up for ages 50 and above $30,500. Okay, so some of the benefits folks catch up contributions help individuals make up for the years they didn't save enough.

Speaker2:
Okay, maybe during the years that your kids were going through school. Or going through college. Okay. And you had to kind of. Allocate more money towards their education, which is great, which is fine. I'm happy for you to do that. But now since the kids have graduated college, okay, they may have moved out. Now they're graduated college, they got their own job. Now guess what? You just turned 51 years of age. They graduated college. And what do you want to do, man? Take advantage of that catch up contribution okay. Because during the years that you weren't able to save enough, now take advantage of that starting at age 50. So by contributing more to your retirement accounts, your money will have more time to grow and take advantage of. What have I said many times during the show? Compounding interest. So another benefit you're also decreasing your current taxable income. How do I do that Randy. Well 401 K. Contributions are for all three. B contributions are pre-tax. So if you put more money pre-tax, that means you've got less money coming in or going out as an income, you see. So if your income is lower you just decrease to your taxable income, but you're still stacking away, stuffing away, supercharging that 401 K, because you're putting that additional $7,500 in there. So that's what helps. So depending on what kind of account the money you contribute may be pre-tax tax deferred each of which has benefits.

Speaker2:
So contributions to Roth IRAs basically are made with after tax money anyway. So your withdrawals are tax free. So folks I hope that helps you understand a little bit more about why we need to get together. We need to set up a consultation because we're going to provide you with comprehensive, no cost consultation to you, our listeners. And again, there's no obligation. You only work with us if it's best for you. We're going to help you analyze your and, you know, your financial situation. We're going to closely examine any annuities you may have. We're going to put together a retirement plan based on your objectives, what your wants, what your needs are. We're going to discover exactly how much you're paying in fees when your 401 K IRAs, whatever it might be. And we're also going to help you with your Social Security planning and determine the appropriate time to start taking those benefits. So, folks, listen, I want to thank you for listening to your American Retirement for joining me on today's show. If you missed any part of today's show, go back in the podcast archives on Apple, Google, Spotify, or whichever platform you get your podcasts from. So folks, it's Saturday. It's a beautiful day. Go out. Make it a great Saturday. Have a great upcoming week. God bless. Go, hogs! We're going to talk next week.

Speaker1:
Thanks for listening to your American retirement. You deserve to work with experienced, licensed financial insurance professionals who can offer sound strategies for protecting and growing your hard earned money. To schedule your free, no obligation consultation, visit your American retirement.com today. That's your American retirement.com, not affiliated with the United States government. Randy Sams does not offer tax, legal or investment advice. Consult with your tax advisor or attorney regarding specific situations. Opinions expressed are subject to change without notice. These opinions are not intended as investment advice, nor do they predict future performance of any product. All information provided is believed to be from reliable sources. However, we make no representation or warranty as to the accuracy of any statement. This information is intended to be educational in nature and does not provide a guarantee or specific result. All copyrights and trademarks are the property of their respective owners. A mirror life assumes no responsibility or liability for the content of this message. The information contained herein is provided on an as is basis with no guarantees of completeness, accuracy, usefulness, timeliness, or the results obtained from the use of this information.

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