So let's hear it from again from everyone we loved in -- yes I loved that whole hour on middle of this hour because I think it's something that. As a group we need to talk more and more about because we have so much to learn. Millions of baby boomers are beginning a process of thinking about retirement. And it is a process one that needs to be honestly thought out and plant. So where do you begin. Well according to our guest and friend of -- WL -- fortune. A certified financial planner and a certified estate planner we need to understand the economy we are retiring in two. I thank you so much for being with the spread and if anybody wants to talk to -- about anything financial. Give us a call at 2601872601870. Let's start with us we're also going to be talking about saving but let's talk about what you meant. About the need to understand the economy were retiring in two iconic at the creeps run -- for. Yeah well I think that the main messages is is that obviously the world's changing in the world's changing fast and the last ten years hasn't been I guess very kind to anyone looking for stability -- right. And so I think what I meant with that was you know measure beginning to retire you know -- the visual try to paint for people leisure. You've been in a plane for for sixty years and managed currency the runway near your common and for the landing NC are starting to make sure that you have. You know you have all of all the all the bases covered and and you just bought it through and I think that some of the things that. That are concerning people are you have a very unstable stock market witches. Dropped 50% twice now on the last. Fourteen years obviously that has folks concerned you have the uncertainty surrounding search for security and and a lot of the retirement type program so -- -- that has a lot of folks concerned and so I think. You know one of the rules we try to play -- to sit down with people help them sort of plot out with they want the rest of their life to mean and then. You know sort of help and think through some of the risks in the trade offs and and really help make those decisions. So we will be your co pilot what you said absolutely -- like it. You you would mention that money for nothing. Inside the Federal Reserve it's moving out and not to open you have not seen. Which are saying. We need to see it. Yeah I had actually written article about that a while back. And I finally did see the new arena thought it was a pretty pretty well done film and I think the reason that I was voicing that publicly that that I thought it was something people need to learn is because. The Federal Reserve is probably one of the most or least understood. Bodies of our government and it's probably one of the most important and it's the thing you don't hear a lot of people talk about your a lot of people under the political debates and things of that nature but. The Federal Reserve plays a very important role in all of our lives and it's sort of hidden role. And I think what what we've learned over the last five years particularly since 20082009. It is the Fed Chairman has almost become a household name now the most people now know who this person is and I think that says a lot. And and in the Fed is is varying gays in the economy right now they they were very active after the two and 2009 crisis which caused the stock market to collapse. And they've even been more so now and so I think the message I was descending on that our -- I think it's. You know appear entering retirement or even if you're younger I always think it's a great idea to just be educated on on how the world works and and I think you'll find you'll be able to navigate and negotiate a lot better if you're informed instance some of the variables involved in the economy so so the Fed is really dictating what interest rates are. Exactly the Fed controls interest rates which. Ultimately in in effect they control the price of everything everything from the value of our home to the to the total grocery bill. At we go make groceries on the weekends to the value of the stock market and they do that via. How how they control and basically the cost of money which is short term treasury and you know we know that home prices and home prices home interest rates have been very low. Kind of creeping up well. -- getting off subject here but I think it's important because. When most things are load and also the return on your investments can be exactly exactly and and one of the Fed's policies was designed to sort of you know he had a lot of people who spent their whole lives as savers with money in the bank and and part of the feds the method behind their madness if you well it was to make life very painful to sit on cash. And to try and July of that cash off the sidelines and so one of the things I've always advocated is it's. It's it's of it's a very difficult thing when you're trying to transition someone who's been a savings account and had you know perceived guarantee your safety of an FDIC program to transition them and the investment world I think it's it's more important than ever that advisors and planners take time to really. Educate folks as to what the feds asking -- -- do you make sure they understand the risks associated with any investment that they make. Because. That the them fast money is very much chasing. Higher interest rates right now but just remember that higher interest rates almost always come with higher risk. Okay I'm more than is the message right there it was just so eye opening to the everyday person has myself and I really put myself there. And what happened in a way to know nine it was just a game changer. And said you know our trust level our fear level everything. Changed exactly and we can even talk a lot about what led to that what caustic as I have some thoughts maybe even share some of the things that led up to it than I think people might find useful okay. Up and we will definitely do that we have a caller Leonard from the plots Leonard. Hello are you good. Mr. -- oh just let -- talking awfully simple well -- -- Obama refer jumped. Breaker -- Let me a sketch up quickly life situation I'll get to nine years old. -- -- -- And I am going to. Very well -- Operate over the months portico of the year -- there. And I'm looking for a vehicle that could lead to 6667. Years old have a couple retirement. And I'm no -- be great but like maybe the other -- dollars. -- oh clustered by giving -- there -- worship money. -- is Richard. Leonard outside of a one of the things some always cautious about it on a designated fiduciary and what that basically means is I have to be very delicate about ever issuing generic financial advice. So so I think I think my best advice to you would be to make sure you sort of sit down. Nature a year year you're optimizing your Social Security which draws I think a lot of people underestimate how important the way in which we take Social Security. Is in and what I'm finding with Social Security that might be the most important investment decision you actually make what I'm finding is because of the uncertainty surrounding it. A lot of people are opting to just take it at the earliest possible date they hear their friends saying things like it's not going to be around. And the reality of it is it's a very important investment decision because you're actually buying a very large annuity and so I would say make sure you're optimizing that process. On as far as where you wouldn't invest the remaining money did to derive the income. I would have to just sit down with peer advisor to -- contact another financial planner who would sit down with -- -- just help you think through. How much income year you're trying to withdraw -- and the types of investments you might have to make in order to meet those objections objectives just to make sure. You know you understand. The pros and cons of every decision. If you're putting in 3000 a month and what you're saying it's over what ten years. Your goal is to have a pot of 300000 dollars. Yeah well actually. Here's a murderer. Problem. If so precarious institute. 66 point two that's what could draw that well tomorrow. So you go elsewhere but electors of the additional trio a thousand ever retire. -- think it's six and -- and you know depend -- Or more of a job market. You know I guess the best way to answer your question. To give you something concrete and not be too overly vague is is. You know the if you're systematically investing in something volatility is your friends salute the quote unquote more risky that investment is. The better your ability to capitalize on that volatility by systematically funding it. On the most important thing to remember about volatility though is once we retire we immediately go from an accumulation phase of investing to a distribution -- investing. Where were withdrawing it and so volatility the same thing that was your friend on the way up can be your worst nightmare in the weight down. And -- keep that as your goal posts -- as you're considering that. The other thing I would say is be very careful of the generic financial advice about having more money in bonds as you get closer to retirement. And the reason for that is is we talked about the Fed earlier. The Fed has been playing a very large role in the bond market on mutual funds came around about the same time as interest rates pizza you know several decades ago in the world has never really seen. How fixed income mutual funds react in a rising rate environment to the extent rates are ever allowed to rise and so. Just be very cognizant of you know typically -- investments that once perceived safe. Maybe not not not working out that way. The other candidates could feel it more remarkable -- but -- but I just let them overload now. Put I understand doctor so and so the. There is no wars there's a phrase that -- you're not thoroughly confused you don't understand the situation -- and ray Leonard thank you so very much for calling. Rod I want you to stay on the line we have to take a quick break but we will be back talking to Brent fortune right after this. -- were talking about finances were talking about for the many and there are many out there baby boomers who were in the process of thinking about retirement. How do we do it. We're also on top of that later with -- fortunate about how to begin saving if you don't make a lot of money. But before we get into that let's go to mark caller Ron thank you so much for holding you had a question. -- -- and got a question my my situation. I'm 55. Years Obama mr. DA. A couple of years ago and restructure and combine -- taxes and now we've only board there and we got hit pretty hard. Optical -- -- and -- commission as well with our. Would you. I'll bite dark CPA recommended the only way to get away from those kind of -- in the -- to increase -- deductible. Person give it to the brand as an alternative. That I can do to keep that money invested. And and not just give it away to the governor's deductible. Know what money's invested. Well and well we want to try and that's where both salaried am in my life commitment and we realize that. All we have to raise our deductible per hour yet. And ordered as an -- we don't get it built from IRS. This year 111000 dollars. Or alternative that would -- looking into the port reduction -- and roll. That will -- that. -- that number. An investment. CD's now instead of just raise another direction on -- Let the government take that might recovers well into the year. I guess the short way that I would answer that as I am definitely not a licensed tax advisor so if your CPAs is kind giving you some guidance and and human comfortable working with him I would say. Absolutely he's probably thought through it pretty well and is and is giving you good guidance from from an investment standpoint. If you have after tax money there are investments that you can make if if you're. Taxable money is is triggering too much income but that's not usually a problem for people now with rates being very low -- So protecting broad spectrum where in my whatever comes toward the end of the year percolate checked in. After our. Employers to increase our production per purchase. I mean it has -- and out and do besides just give it wouldn't. So local. And it to the government. Two to god that's so I'll cover my tax base that I guess that that make it as much or. Ultimately you get at the end you're gonna get nailed again. I know it is whether -- some investment. Either it's in my local bank. I take. -- hundred per month to prove that he'd been to Egypt stay. Did you and I increased my deduction from 10% to 20%. Yes so I don't -- into the year you know. Well Leo the the only way that I -- some understand your right the only thing that I would maybe talk to your CPA write about trying to reduce your taxable income. Is to consider funding on some sort of retirement account disputes that your wife -- commission base that might mean she might qualify for. You know like -- sep IRA which would allow you to put you know considerable Mormon money into a tax deferred vehicle which could get your income down and contribution tax liability. But you know that that the thing you have to think through with any tax deferral strategy right now. I'm of the view that I don't I don't envision a scenario where tax rates are going down in the future. So you wanna make sure you're working with some money to think through whether whether to flooring income makes sense for you right now. But Dallek complicated Brett sector job McDaniel left here. In your wonderful thank you very much for the call. You know I think what -- does this. I think what -- How I interpreted is why am I giving this to the government -- like it may be put it in the bank it would earn little interest and then of course I have to painting him but it will have been earning something. Got Jokester he yesterday's storm into -- pay and pay my taxes on an ongoing basis or just at the end of the year at the end of the year but is there's a vehicle that I could put. The same money I would be adding month leap to mind deduction if I could put that something that would -- little bit and then I would have to pay but I guys. I mean it's certainly that's that's a viral strategy against the the the challenge there is is that. In a normal interest rate environment I would say that might make some sense to try and pay me now campaign and later -- I am now been in an environment where the cost him money zero and and -- interest rate on money is zero. It might end up just being a lot of work for for nothing kind of thing and and if you're gonna need the money in twelve months than just our whole -- places you can invest that money. To make that whole activity worthwhile I'm. What is the savings account at that point 00 -- -- if it's it's it's barely a mathematical figures at the thrust of what can you. I want everyone to stay with -- it's a complicated subject we're really gonna get to it though stay with this we're gonna talk to Brad portray more about money but now let's go to the newsroom. Our very special guest -- for -- who is a certified financial planner and certified estate planner. And everybody wants a simple. Answer it is gonna happen. But for those who are retired and are still looking -- the scary market. For those looking forward to retirement in a brief period of time someone like Leonard -- call. And then for those who have a long -- -- ago. Your life as a financial planner has changed so the things that you might have recommended ten years ago aren't necessarily. What you're doing today. I definitely think you know I've I've evolved and changed a lot within this industry and a lot of it has to do with the environment in which were. We're sort of managing risk and managing money in and I was mentioning earlier. Com about that 30000 foot view I mean to put into context why it's so hard. To establish concrete answers for anything is. We are. We are currently paying the price for her for decades. Sort of broken thinking it's gone now like to think about it and for the longest time. Americans were taught you know the American dream you you invest in home they call an investment I don't believe me as an investment we can talk about that. It was go to college. And and then that that gives you graduation -- income so there was more security and stability. You know then you by the diamond engagement ring which is six months' salary -- believes the going rate for one of these days. And and then you have the the big box home improvement stores who told us that. You know renovating our master -- was an investment in our future and so. If we look back at the narrative we can sort of take a step back get in the get in the 30000 foot view and say I -- Right now I'm starting to see how we got here now I understand why the Federal Reserve is having -- by almost a 100% of MBS its issuance. Because no rational person is gonna land an American money at current interest rates for thirty here since so that's how the Fed gets in that role. On that's why interest rates are -- to near zero. Because the economy really can't afford for them to rise we would we would go insolvent pretty quickly that's the nature credit based economy. And so I guess. Using that is the context how five -- you know as a planner as an investment visors -- try to perform role of educator. You know consultant guiding people is to look at this is how we got here this is why there are no easy answers. You know most people seem to agree in the biggest question I get his Social Security going to be there for me. In the way that I think of it is you almost don't even need to have an opinion -- answer about it the fact that people are asking the question is enough to tell you how much -- sat there and what makes planning so difficult. And and there's a lot of reasons for that and so. You know the first thing I try to say -- -- let's let's let's look at the narrative. At the end of the day when dying when I've summarized is that. They're really two types of monetary actions we can either consume or we can invest. Money is just sort of this. It's just this energy and when we consume it we expanded there's nothing that happens after. When we invest it we create renewable energy which is the difference between owning a home vs owning -- rental property. And then we use debt based consumption we do almost the the worst case scenario which as we we create. And energy terrain going forward to these are all the things that work. That were recovering from now there there are new easy fixes. And so I think in a lot of ways. Trying to adopt this idea that there are timeless investment strategies I think can be a dangerous game and and if if people were still -- their promoting that. You know one of the timeless investment Winston's placed -- -- to preach and was taught was that a 6040. Stock to bond portfolio was was all the average person needed while. The problem with that is is that 6040 stock to bond hopefully it depends a great deal on. On when you start distributing income to the person who retired in 1999 they have a high chance of running out of money. To the person who retired in 2000. And nine they probably have a much better chance of being successful. Because the level of volatility has been so great so on. I think that's the context that's how I've tried to evolve and I think that's why people are so confused because there's ought to be confused. There's a lot to be confused about and I think you just said to think people just don't wanna run out of money exactly and and that is a concern and it does happen in so you know the key is to save as much as you can. Which try to make it work for you exactly and then understand. What it's gonna take -- live on if you don't have a job exactly and really had -- I think that's where that. Rubber meets the road exact we can all put down rent electric not -- but it's the other things that. The surprises. That can throw people off. Absolutely and and that's why I think you have to try and balance the need for certainty and security. You know a lot of one on the investor -- is gotten very popular the idea of an annuity -- insurance company knows and everybody's scared and and and and concern and what do people do when they're concerned they're scared they want certainty they want guarantees concerning insurance companies -- Making a great deal of money right now you know. Serving the the baby boomer generation and I think those products can be useful. For stylish and that baseline income floor that you don't wanna have to worry about. On but their conceivably scenarios where if you're not careful about which insurance companies -- that. That might not even be a sure thing in 2009. There were there were triple AIG was a AAA rated insurance company going in of that event. And -- You know so I tend to put a lot more depth of thought into every investment recommendation and sometimes that makes trying to think think through what is prudent very difficult I think that the people who were really struggling right now the people who were. You know. Truly trying to understand the scope of what's taking place and how to best position and it is it's a lot like investing and -- Mears with the Fed kind of polling on whatever believers. Nobody really knows what anything is technically worth. This is a very discouraging -- But it's real and you know it's like -- say -- whether it's the new change in health care. We're not all going to be doctors to be able to figure this out we're not all going to be new to understand. The finances but it's kind of in our laps. Right well here's the thing I don't like to look at it is discouraging or negative I think the first step anybody ever tells you if you have a problem or if you're if you're honest stressful situation as you've got to acknowledge with challenges. And the challenges. There have been a lot of factors that play into. You know living out a certain narrative and if year if -- intent on holding on to that narrative that I can see how the fact that it might be going away is is is thought of -- negative to some people I don't think it is. I just think you know were in a period of immense change. Here's some of the good things that I see that come from a one of the things hour's -- there was a lot hurricanes. And look at me like I'm crazy. -- -- and all of our Kansas because for two days the family gets together nobody's rushing around like a maniac but we're jumping from job to job. We sort of were reminded about what's important in life and I think that is the that is the essence I think what were coming to the realization of so what does that have to do with this subject well. In the past six months I've been working on two I call on family mergers and acquisitions and these are clients are coming to me firm. If they want answers that I can't provide and that's what everybody wants is an answer that nobody can provide your politician can't provide your Fed Chairman can't provide it. Nobody knows with the future holds and so -- we can either embrace that. We can let it cause fear so with my clients are -- and I don't know what the future Medicaid is I don't know what the future Social Security is. They're merging with their families that I've got a client. In their kids are coming together they see being able to. Prop provide support while their children raised their grandchildren so they're moving into the same -- sold a combined council's. And then on the flip side as my client's age their kids are going to be able to provide care for them by being in the same house. Well I'm sure the average person listener -- you know roll their eyes thinking there's no lack of effort through back in with my family but but the reality is those are some of the I think the the nice things that calm from. Creative idea exactly creative ideas there's more than one weighs more one way to plan around something in the -- people with their doing and I'm -- cases like this in the last six months. They're selling homes that provides liquidity event that gives them cash resources to invest in and -- generate an income went. They now only need one washing machine if something breaks in there there's energizing their cost structure. Just great deal of synergy and so with their essentially doing is increasing the value of the time that they have left and and so I think you're gonna see more and more that you couple that this is the reason I'm not too bullish on housing American housing is because you -- the fact that boomers are retiring. Lot of my clients are already talking about the need to downsize. As as our runway gets shorter and shorter we start to realize that homes are pretty. High maintenance thing that take care of her life priorities are changed and we might not wanna spend the day cut grass or changing changing gunners went 19. On so as the boomers age and they start doing this downsizing -- consulting you've got. The next narrative about to bite us which is the idea that college creates lifetime security these kids are retiring pulling in that a lot of them. -- largely under employed because corporations found out in 2009. That they could use the crisis as an excuse to downsize labor Costco to technology. So these kids were sold a bunch of promises that that we made them -- that if you go to college and you you know go in the six figure debt loads that your future secure. Well that's not true and so now first time homebuyers and for the first time the national association of -- realtors came out with their survey last week. -- they reference college debt burden as the number one culprit in life first time homebuyers are struggling to and a remarkable. So you have this dynamic and you can already kind of see it playing out. On that doesn't mean you rush out and sell your home tomorrow but just helps to have some context as to what -- takes place in the macro economy because it helps you appreciate how difficult it is to truly manage risk. And when you have a fed and and a government that this active in managing the economy. It's hard to know what a good or bad investment even this thing. Stay with us everyone we're gonna continue talking to -- torture and -- come back we're gonna talk about. How can people save who don't make a lot of money right after the this. Well we've been talking with -- for Cheney who was late certified financial planner and certified estate planner. About. The reality will any of the -- able to retire her. And done and the complexity. That all of us are facing. Including himself as our world has changed a great deal financially. There's still some basic things you still have to know. That you have to say that this isn't gonna come out of the year. I'd like to talk to us in our final think there are a lot of people who now get it. But they don't make a lot of money and they are amassing just paycheck to paycheck but not a lot of extra money. What do you say to them about starting the process. Of having a plan to retire. Yes so the other day I went to health expo and the guy guys that trainer says the first question yes anybody that walks into his gym is. Is what is your commitment level on a scale of one to ten. -- when a loved about that is the first question. Is he was acknowledging that the battle is are either won or lost before that person even walked in to the health the cells he. And so I think my first challenge to people would be what is your commitment level about really wanting to change your current lifestyle. And if you're if you're seriously committed in doing it you'll you'll make the time and this -- always been the case for me -- make the time and and and the changes in the count of that that'll be necessary. On so for the idea that we're living paycheck to paycheck I think my response would be. At its most basic level the only way we can never generate additional wealth is we either have to get our income or expenses down. In what I've found is. The response people always give you is that when they say can't get my expenses stacks and -- live and at the baseline level. Let's assume that that's true for me -- every time I've ever -- and it's not men and again it took a hurricane to make me realize it but that announcement negotiate rock and three channels so. I can get I can get rid of more than I think I can sometimes I think we all can. If you gotta get the -- up then I would submit you need to find more time in the day in order to be able to generate at. Maybe need to work harder at the job you have maybe need to try out second job. And I would say just if you just cut the TV out your life and use whatever got done was then then then then that's where you go for your extra opportunity. We'll take another break we'll be right back. I wanna thank -- for -- so much for joining us it's just a conversation we're gonna continue to have because it is complex. -- but say think about your future and join us again tomorrow thank you very very much.