Bad Money Habits That Could Ruin Your Retirement

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

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

Producer:
Welcome to Safe Money Masters with Greg Castle. Get ready for a full hour of financial information and economic news you can't afford to miss. Greg works hard each and every day to help hard working Americans like you navigate challenges and reach the financial freedom they desire and deserve. So now let's start the show. Here's Greg Castle.

Greg Castle:
Hello and welcome to Safe Money Masters, where our main goal is to help you, our listeners, become masters of your money and teach you how to keep it safe. You know, hope you're having a terrific Tuesday. My name is Greg Castle. I'll be your host, along with my co-host of producer Matt McClure. Matt, I think that we have another great show lined up for our listeners today. Now, why don't you tell us a little about what to expect?

Producer:
Yeah, I'm hoping that it's going to live up and I'm sure it will live up to those lofty expectations that we always have for ourselves here on Safe Money Masters. We set the bar high. And so it's, you know, we got to keep keep raising it every every week here. But yeah, we've got a lot coming up on today's show. We're going to, of course, start off, as we usually do with some words of wisdom in our quote of the week. We've got some bad money habits that could have a a big impact on your retirement. We'll have some things to watch out for there. What it's like to work with us and specifically what it's like to work with Greg Castle and the good folks there at Castle Financial Solutions Group and also how to be proactive about your retirement instead of being reactive. How to be proactive about your retirement. And we'll have some strategies for success preventing retirement tax bombs and how to take advantage of some tax free options. That will also be a big topic of discussion for us. And then ten key resolutions for a sound financial plan. Plus this week in history, if we if we get there, if we get all the other items crammed into this next hour of radio and podcast land that we have for you here. It's a bunch to get to, but it's it's all good stuff, Greg.

Greg Castle:
Sell like a great show. Hey, Matt, just like always, before we continue, I'd like to take just a minute to remind our listeners what the show is all about. The whole premise of our show is to bring you topics and tools that are going to help you grow and protect your wealth and retirement income. So, of course, we hope you keep tuning in so you can catch us every Tuesday evening at 6 p.m. on Moneytalk 1010 on your local FM stations, 92.1 and 103.1. And if by chance you happen to miss an episode, by all means try and catch the replay at SafeMoneyMasters.com or wherever you listen to your favorite podcast. And you can also catch us on YouTube channel, Subscribe to see weekly video highlights and special content. So if you've got any questions or comments, we'd love to hear from you. Feel free to email me at Greg@SafeMoneyMasters.com or give me a call at (813) 430-7100.

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

Greg Castle:
The quote is, I am not a product of my circumstances. I am a product of my decisions. And that quote comes directly from Stephen R Covey.

Producer:
Yeah, it's and it's powerful, powerful stuff there. You know, Stephen Covey was an American educator, author, businessman, speaker as well. He was the author of the book. And he actually died back in 2012. But he was the author of A. Really a bestselling book in recent memory here. The Seven Habits of Highly Effective People, 1996, Time magazine named it one of the most 25 influential people of that year. I mean, just, you know, somebody who really knew what he was talking about when it came to productivity in your life.

Greg Castle:
Yeah, as a matter of fact, going back to the Seven Habits of highly Effective people, you know, for years I taught, you know, executives and leaders, and one of the things they used to teach them was communication. And there was a quote that came directly from seven habits of highly of people that deals highly effective people that deals with listening. And remember this quote very, very well. And more advisors should remember this quote as well. Hopefully they adhere to it. And that is we should seek first to understand, then to be understood, which means basically that, you know, we shouldn't jump in and interrupt a client when they're talking until we fully understand what they're trying to tell us. And once we have what they're trying to tell us and understand what they're trying to say to us and intimate to us, then at that point, then we have the right to come back and interject and and offer a solution or, you know, just continue the conversation. But we should seek first to understand, then to be understood. And I can tell you from experience, too many times people that I've talked to and I've probably been we've all been probably been guilty this a time or two in our lives.

Greg Castle:
And that is somebody will be talking to us, whether it be on the phone. I used to be guilty of this when I talk to my mom on the phone. Because your. My mom loved to talk. And. So I would you know, I would tune her out. I would do whatever I'm doing, work on the computer, whatever. You know, I did my daily phone call to my mom. So always great love talking to her. But I would just tune her out and all of a sudden she would you know, she would say something. I thought, okay, whenever she stops, I'll jump back in and say something. And then I realize all of a sudden that she has changed directions of what I was going to say is no longer appropriate. So, you know, we should seek first to understand, then to be understood. So I have digressed here. So what do we have next? Matt?

Producer:
Yeah, that's a very good illustration there. And another great quote to to talk about from Stephen Covey there. And boy, wouldn't know anything about a mom who loves to talk on the phone. Okay. So I love I love my mom, though, and I love every chance to to be able to talk to her and grateful for it. But okay. So before I digress here, some bad money habits that could ruin your retirement. You know, on a on a previous show, we've really been highlighting some of the most productive habits that wealthy people use to protect and grow their money. Right? We kind of talk about that each and every week, try and give people, you know, the the insights on some positive things to do with with their money this week. We kind of want to turn that on its head a little bit and and shine a spotlight on some habits to watch out for and avoid because, you know, developing any one of these bad habits could really put your future and your retirement at some serious, serious risk here. And number one is a big one. Think it's something that a lot of people find themselves in this situation and it can be a hard one to get out of if you find it yourself doing this. And that is living paycheck to paycheck.

Greg Castle:
Yeah, there there's so many people that I know that that actually, you know, this falls, they fall into this category. I read an article recently that said that as of January 2023, the beginning of this year, at least 60% of us adults are living paycheck to paycheck. And that's just unbelievable. You know, too many people spend every dollar they make and soon after they're paid. Um, and, you know, we all, you know, we know that at times that things are going to get tight. Just make sure that you're very careful that you don't make a habit of living beyond your means and always waiting for the next paycheck and and already having it spent before it ever gets here. Not a good way to live. That can definitely that can definitely ruin your retirement.

Producer:
Yeah, definitely. So it's not a good feeling to know that, you know, the cheque, the cheque is in the mail, but the money's already been spent and it's, it's out the door before that cheque even arrives. So that's not a good feeling at all. Number two is another kind of month to month sort of a thing. But this is instead of money coming in, this is part of that money going out. This may be a reason why you're living paycheck to paycheck, and that is carrying credit card debt month to month.

Greg Castle:
Yeah. You know, credit cards, credit cards have just excessively high rates. Apr is typically run with somewhere between 20 and 30%. Addition to paying high interest fees, you're also carrying a carrying a balance is also going to have a negative impact on your credit score, and that could prevent you from borrowing money or receiving favorable rates when necessary to purchase a home or buy a car, or invest in your own business or whatever you want to spend money for. If you need credit and you've got really, really high interest rates or you're carrying high balances on your credit cards, that can really come back to haunt you. So credit card debts are a major source of financial stress in the United States, as we just mentioned to you. You know, living paycheck to paycheck is no way to live. And if you carry credit card debt, you know, work on paying those credit cards off as soon as possible, starting with the highest interest debt and working your way down to being debt free.

Producer:
Yeah. And that that should be a big goal, I think, for everyone being as as debt free as humanly possible and getting there as quickly as you can because especially those high interest debts really, as you say, can can just wreck your retirement plan. Yeah, it really can. And that's, of course, folks, if you're just tuning in, the list that we're going through here, the bad money habits that could ruin your retirement. And number three is having no emergency fund.

Greg Castle:
You know, we found back in Covid, back during Covid back in 2020 when everything, you know, went went to hell in a handbasket. So many people lost their jobs. They were working in service jobs, you know, restaurants or or resort businesses especially, you know, here in Florida. A lot of that goes on. And. Those folks that had no emergency savings, you know, really, really felt the sting of it. Financial problems definitely came into play. So lack of emergency savings savings can lead to long term financial problems. You know, according to a study I read by the Federal Reserve said that 40% of adults that would have difficulty covering unexpected expenses of $400. 12% said that they would have to borrow or sell something to cover the expense. I'll do your best not to borrow from your retirement savings to pay for emergencies. You know, my recommendation or the general accepted recommendation is that you have at least six months of expenses in liquid emergency fund that can be used to quickly cover unexpected costs. Um. Now, of course, if you. We're already retired and you have guaranteed lifetime income. That's not going to decrease. You know, you're going to be much better off. And perhaps that six month rule may not apply to you because the likelihood of you losing your job or retired is going to be nil. And by the same token, you should be okay. So maybe having 2 or 3 months in case something really happens to you, like your air conditioner goes out and you got to replace it, that's a big expense or having a plumbing issue. A buddy of mine just told me about an issue he's having with his water going into his house and it's really, really bad. But, you know, even if you're retired, some things sometimes expenses should come up and bite you in the butt. If you don't have an emergency fund set aside for those, it can really hurt you. And you don't want to have to to plunge into your retirement savings to cover those expenses.

Producer:
It could potentially be, you know, if it's a big issue like you just talked about, especially something, you know, where it's dealing with the house, maybe there are some structural issues or something or replacing some big ticket item like that Hvac system that can really that amount of money at once, if you don't have it set aside, can can be a lifestyle change for people. It really could and something to watch out for. Definitely and really have that emergency fund in place. Number four, bad habit of money that could really have a big impact on your retirement here. Not knowing where you spend your money. You got to know where it's going.

Greg Castle:
Man. We find that too many people really don't have clear financial goals. So with no formal plan in place, you know, things can really go haywire. You know, at a minimum. We like for people to have a budget of monthly needs and wants so they can effectively tell every tell where every dollar is going to go. You know, be on the lookout for recurring charges for monthly subscriptions and services, review your last few months of bank and credit card expenses to verify that you aren't taking any notice, that you're not making any unnecessary cost. Part of having a budget and a lot of people really hate the budget. They really don't want a budget because if they have a budget, then it might prevent them in their mind from getting the things that they want, which is probably true. That's what a budget is for, to make you control your spending. But, you know, part of having a budget is having a plan for any extra money that you bring in. If you receive a bonus from work, it can be easy to spend that money with no consideration for your larger goals. You know, a better idea is to have a plan for that extra income. You know an example, let's say 25% goes to saving for retirement. 25% goes toward a family vacation fund. The remaining 50% goes toward paying down the mortgage. That's not that's not 25, 25 and 50 of all your paychecks. But that's just that's just discretionary money that you have 25% for savings, 25% for perhaps a family vacation, and the other 50% go to pay down the mortgage.

Producer:
Yeah, just bottom line is have a plan. Because if you don't like you said, you know, you don't really know where anything is going and it's you're just losing money. You might as well just have holes in your pockets. You know that the money, just as soon as you put it in, it's fallen right out and you don't know where it winds up. Yeah.

Greg Castle:
If if I were to summarize this entire thing and basically it's the entire thing we're talking about in today's show is going to be have a plan. Have a plan. Have a plan without a plan. You know, you're driving on a road with cliffs and curves and not knowing where you're going to go in the dark. So, you know, just just take some time, spend at least as much time planning for your retirement as you plan for your vacation every year.

Producer:
Yeah. Yeah. At least. There you go. And number five is, you know, our our on our list rather, I should say, of these bad money habits is people, you know, not wanting more from their careers.

Greg Castle:
Improving your income, you know, is the best thing you can do to increase your net worth and prepare for successful retirement. So you need to seek out opportunities to advance in your profession. If you're happy where you are and you're not very high up the the not very high on the rung of the corporate ladder, that's okay. But at the same time, you know, usually dedication, self-education, communication, those things all pay a big dividend on improving your ability to earn additional income. And when it comes to I know from having, you know, been a consultant for years and years, when we go into succession planning, we go into we went into taking a look at who's going to make a good supervisor from the technical, you know, pool that was out there, the working pool that was out there, the hourly pool or someone that we wanted to promote into management from a supervisor position or director from a management position. Things that came up most were the ability for the you know, what does that person done to improve themselves? You know, have they taken leadership classes on their own? Have they done some other things on their own? Have they gone to the courses that were offered by the company in certain cases? And, you know, if you don't do anything at all, that's going to improve, you know, your ability to to earn a better paycheck, then, you know, number one, shame on you.

Greg Castle:
And number two is that, you know, don't expect that you're going to get big promotions when time comes around. The If you can't improve your income at work, consider improving your schedule. If a company is offering you a four day work week for the same pay, I think we've talked about this in a previous show. But, you know, if you got a chance for a four day workweek, same pay and you want to consider that, no problem, it gives you extra time if you want to get a second job or make money with a hobby, you can do that. Now, as they say, you know, time is money. So having a flexible employment situation can be just as valuable as a raise and can give you the opportunity to earn money from side gigs or travel more often. But, you know, just just make a point to try and prove yourself. You'll be you'll be glad that you did.

Producer:
Yeah, absolutely. Can make a huge, huge difference there. Number six on this list is not knowing how to minimize tax. We'll get into this guess a little bit later on in a little bit more depth here. But, you know, not knowing how to minimize taxes, not only is, you know, something, we're talking about retirement planning. So so not only, you know, your potential future retirement or potential future tax bill, rather, but your current tax bill each and every year when you file.

Greg Castle:
Don't just check the check the box on file again next year, you know, consider working with a tax professional who consider your unique situation and answer the questions that you have and help save on taxes. Because right now, tax planning is really key. We know that, you know, do the job tax cut and job acts from 2017 that the the highest marginal tax rate was cut from 39% down to 36 and change. And we know that at the end of 2025 that tax rate is going to go up again to back where it was before, at least, if not higher. And if you were to ask someone, oh, you think taxes are going to go? Well, Matt, do you think taxes are going to be higher, lower or the same in the future?

Producer:
I if I you know, just wild stab in the dark here. I'm going to say they'll be higher.

Greg Castle:
You know, you are so smart, very intuitive, always like that about you anyway. Anyway, the you know what I ask clients, you know, clients that are really not taking advantages of the tax free investment opportunities. And I'll ask them, do you think taxes are going to go up, down or remain the same in the future? Everyone, without a doubt, without exception, says taxes have got to go higher. And I say, you are so right. So why are you doing what you're doing? You know. So let's talk about how to save you some taxes here. Anyway. You know, tax pro can can help you legally claim all available tax deductions and credit and some of those you may not be aware of. So trust the experts when it comes to something as important as your money. And we'll talk about it a little bit later. But you need to utilize the only two types of tax free investments, and that is Roth IRAs and life insurance products such as whole life, permanent life or annuities.

Producer:
Yeah, absolutely right. Definitely things to look into and we'll go in more depth, as we say here in just a bit. Number seven on this list of bad money habits that could really impact your retirement, being being unwilling, I should say, being unwilling to take normal risks with your money. Now, we talk, of course, obviously, the name of the show is Safe Money Masters. Right. So we talk about keeping money safe and getting, you know, growth at the same time. But obviously, there are a lot of things that people do with their money. You know, you don't want to just keep it under the mattress. You know, that's that's not going to be a good thing. It's not going to do anything for you then. So there's going to be at least a little bit of risk that you take, right?

Producer:
Uh, you would.

Greg Castle:
Think, you know, some people just don't trust anything. They don't trust people. They don't trust the markets, They don't trust banks. They don't trust anybody. I guess we all know some people like that where they just are, you know, grandpa grump or somebody, I don't know. But anyway, they. There's my when I correct my granddaughter, sometimes she'll look at me and say you're grumpy britches and say okay so and new nickname for me anyway I try not to be grumpy but you know she just doesn't take no very well. But anyway, some people just are very untrusting of the stock market or even other safer kinds of investments. You know, we talk about annuities. Some people have heard bad things about annuities. There are some annuities that I would talk about about for retirees particularly. However, there are some very good types of annuities, but people sometimes just don't trust me. They've heard so much information out there, good, bad, indifferent. They don't know who to trust. They don't know what to trust, and it makes them very untrusting in general. Taking risk as part of investing. You know, you have a low tolerance for risk. Then we can help you put together a plan that prioritizes protecting your assets. In other words, keeping your money safe, going back to safe money masters, making you masters of your money and keeping it safe while still giving your savings the opportunity to grow with market like returns. So give us a call. (813) 430-7100. We'll help you out.

Producer:
Yeah, that's right. And that number once again 813430 7100. You can also go to save money Masters.com That's the website and you can fill out the form there to get in touch with Greg Castle and the folks there at Castle Castle Financial Solutions Group as well. Now, talking about going from risk here to talking about the timeline that you have for retirement. Right. You know, people we use the term time horizon quite a bit in the financial space. And so a big mistake that a lot of people make is number eight on our list, Greg, and that is waiting too long to invest in your retirement.

Greg Castle:
There was a very, very wise man once who said that compound interest is the eighth wonder of the world. Little test for you, Matt. You know who said that?

Producer:
I do know who said that was Albert Einstein, wasn't it?

Greg Castle:
Very, very good. You were. You were two for two today. I'm so impressed. You know, just like Einstein said, take advantage of the benefits of compound interest by developing a good saving habit as soon as possible. You know, you don't need a lot of money to get started. If you're young and don't have a lot of money. It doesn't take a lot. But get started because you know you're developing a habit. Whenever that you don't develop a habit, it's too easy to just come through and pass it up. I'll do it later. I'll do it next year. I'll do it the year after. I'll do it when I turn 40. I'll do it when I turn 50. I know some 60 year olds that don't have a penny saved, so you don't need a lot of money to get started. And you can begin investing with your own IRA or Roth IRA preferably. And you set up automatic payments and contributions to make that happen for you. So definitely take advantage of those things. Don't wait too long to invest in your retirement because those people that started young and got some advice and developed a plan and develop a systematic approach to savings. Um, an investment whenever that they get ready to retire. And I've talked to those folks now that have done those things. They are very, very well set. If they just need to, you know, plan to make sure that they're going to be able to continue on. But at the same time, you know, they they have they have done well. And I'm always congratulate folks that have done those things.

Producer:
Yeah. And for for good reason. They're. Well, number nine on this list of bad money habits is just sort of this general belief that money is bad, you know, that it's not something to be discussed or talked about or anything. You know, I think some people, especially when you're when you're younger, I know that, gosh, when I was in school anyway, I used to get I used to have this sort of attitude where I would just just, you know, pretend that my homework didn't exist and that it would go away with my homework. Right. But it didn't go away and quickly found out that if you treated it as if it would go away, your grades would really suffer for it. So I turned that around really quick. But, you know, there's money. People treat money that way, whereas like just something that sort of happens in the background, but you don't really talk about it that much.

Greg Castle:
No. And there's there's a lot of folks that, you know, for example, people from the generation before mine, those folks were just kind of taught to, you know, not really talk about money all that much. And especially if they didn't have a lot, they didn't really mention it. And I can talk like I can go back to my my family, for example. Never knew how much my dad made, and he didn't make a lot. You know, we were probably lower middle class families and a family and then. But even with with that said, it's just I didn't know how much money my dad had made or didn't make until he passed away. And I was trying to help mom and manage your finances. And it was just it wasn't that he believed that money was bad or we believed money was bad. It was just they just weren't wants to talk about what they had or didn't have. And so for many people and many families, money is a taboo subject that's not to be discussed. The custom has become embedded in the culture and as a result, our country at large is serious lack of financial education and literacy. They don't teach you about money in school, normally, at least not in, you know. K through 12. Some college courses. If you take business courses or finance courses, you know you'll learn more about it. But for those folks that don't go to college and don't take business courses, you know, you really don't know how to handle money unless your parents have taught you.

Greg Castle:
It's really important to do that. So if you're a parent now or a grandparent, find a way to teach your kids or grandkids about the importance of money and not to be greedy with them, but but help them teach the importance of money and the importance of saving their money. When managed properly, money can provide stability and security for you and your family. It can also show you how to achieve your wants, such as buying a second home or taking family on a nice vacation or buying your dream car. But my advice buy your dream car after it's two years old. Let someone else take the depreciation off of it. Money can also be a powerful tool for change. Considering donating to your church or other organizations you value and trust money. Someone was heard when someone would say this and it really, you know, impacted the way I thought about things. And that was, you know, you need to to make more so you can give more. If you don't have enough money to to handle your own needs and wants, there's no money to help other people with. So the more that you actually make, the better opportunity you have to help those that are less fortunate than yourself. So money should not be taboo.

Producer:
Yeah, absolutely. It can be a can be a great force for good when you're able to give back to those who are, as you say, less fortunate. 100%. And going back just a second to that piece about, you know, financial education, financial literacy, there are, you know, a few states here and there that sort of slowly but surely are requiring at least some form of financial education. But absolutely. Right. You know, that that just, you know, generationally has not been nearly enough of that in this country. You know, you've got kids in school who are doing this, you know, taking these courses in advanced trigonometry and algebra and geometry and all this stuff. And yet, you know, they don't know how to balance their bank account or, you know, just write the check for the rent or whatever, you know, like that. Not that people really write physical checks all that much anymore, as least as much as we used to. But still, the basics of, of, you know, your financial life coming up with a budget and staying to it and all that.

Greg Castle:
So yeah funny funny story I. And needed to write a check yesterday and I couldn't find my checkbook. When I finally found it. Um, you know, this is July. The last check I wrote was October of last year.

Producer:
So did you have to blow the cobwebs away when you found it?

Producer:
Yeah, pretty much.

Producer:
It's getting to be that way here with technology, but yeah, no, you're absolutely right. Financial education. Super, super important.

Greg Castle:
Put put that checkbook someplace where could, you know, make sure I wouldn't lose it and then forgot where I put it. So.

Producer:
Yeah, exactly. Yeah.

Greg Castle:
That's where I lost it anyway.

Producer:
Yeah, right.

Greg Castle:
Last place I looked, I found it. Yeah.

Producer:
It's always the last place you look. There you go.

Producer:
Yeah.

Producer:
Well, rounding out our list of bad money habits here that could really impact your retirement is not saving enough money into an investment account.

Greg Castle:
You have contribution limits on some IRA accounts. For example, the IRA contribution limits for 2023 are 6500 for those under age 50 and allowing for make up contributions for those that are 50, 50 or older, you can contribute an additional $1,000. It makes it 7500 over for those. So before you buy that next big want, consider paying yourself first and investing in your future. You know, if you're if you're tired of worrying about your future and you're ready to learn how to create a safe money retirement, simply pick up the phone and give us a call at (813) 430-7100. Once again, that number is (813) 430-7100. Or email me personally at Greg@SafeMoneyMasters.com. You know, we help pre-retirees and current retirees with this all the time. So pick up the phone and give us a call.

Producer:
Yeah, absolutely. The thing to do and when you call that number or use that email address, type that email address into your your email, you can reach out for a free consultation. Now, Greg, you know, a lot of our listeners, um, you know, may have thought about reaching out either to you or to someone else because there are seems like a ton of options out there for people when it comes to choosing a financial professional to help them along that road. Planning for retirement. To talk for a second, if you will, about what distinguishes. You at Castle Financial Solutions Group from the others that they might hear about out there?

Greg Castle:
Okay. That's a good question, Matt. The you know, first of all, you know, we're not greedy at Castle Financial Solutions Group. In other words, our primary goal is to make sure that everyone has the opportunity to plan for retirement and come out with a good plan when it's all done. So, you know, we encourage you to find a financial advisor. Preferably it will be us If it's not. As long as you find someone that you trust and that you are getting great advice from, then you know, by all means, you know, we won't we won't begrudge you for that. But as far as what distinguishes us other than that, is that, you know, first of all, there are the fees. Advisory firms typically adhere to one of three models. You know, model one is a fee based model where they they charge you a fee based on their assets under management or how much of their money, how much of your money do they have. And that total amount basically they're charging an annual fee for. As your money grows, then so does their fee doesn't change. However, they're making that fee on a higher amount of money. If you lose money, they're still getting the same fee. So a slightly lower amount of money. So again, it goes back to that commercial you hear all the time. It says, we do better when you do better.

Greg Castle:
The fee doesn't change. What it is, is what is going to be. And fees typically range somewhere between, you know, one and 1.5% for for most advisory firms for assets under management. Uh, the second model is a commission based model where in other words, an advisor or a company may say, okay, you know, take this product, in which case the company whose whose product or service that they recommend to you pays that advisor a one time in this case commission or fee commission, let's call it that. Rather than get confused on the fee based product, they pay them a one time commission, at which point that money does not come out of your funds that you're putting into the investment or transfer it into an investment. In other words, that money is basically considered to be a marketing expense for independent advisors or other category, but none of it comes out of your money, but it's only paid one time. So down the road somewhere, instead of having to pay that 1 or 1.5% every year over and over and over again to a fee based advisor, a commission based advisor gets paid one time to service you. It doesn't mean they stop servicing you once they get that commission. Hopefully not anyway, but you know, it's just a one time, one time commission pay to them. And the third model is basically a hybrid of the two where they basically charge a fee for investments that are considered assets under management and for products that they would sell, you know, such as life insurance products of some type, whether it be life insurance, whole life term life or annuities.

Greg Castle:
They would get a commission on those products. Castle Financial Solutions Group, You know, we deal only in safe money strategies and if elected, not to be a fee based firm. Instead, we typically take a one time commission from whichever company or carrier our client's chosen, and the client never pays us a dime. And none of that commission ever comes out of their, uh, their funds. So they put a $100,000 into a product. That $400,000 goes in and nothing comes out. So it's still all their money. So basically that could save them thousands per year in fees as depending on the size of the portfolio. So don't get me wrong. You know, though, our vast network of professionals, through our vast network of professionals, you know, we can offer our clients everything they need. But most importantly, you know, we can help you develop a safe money retirement plan that's safe from market loss. And it's also inflation adjusted. If you've got an old 401. K from a previous employer, you know, we can help with the Roth conversions or help roll it into a safe vehicle that provides market like gains and guarantees, no loss due to market volatility.

Greg Castle:
And we can also help you with Social Security planning, a strategy that seems like something so simple. You turn a certain age, you follow for Social Security. No big deal. But if you plan wrong or you take it wrong, it can cost you literally hundreds of thousands of dollars over your lifetime. So it's important to take a look at Social Security planning. We can also compare your current situation with what's possible if you work with us. And remember, it's your money. It matters to you. I promise you that it matters to us. So give us a call at (813) 430-7100 or shoot me. Greg Kassel an email at Greg@SafeMoneyMasters.com. Now, also, if you like what you hear on this show, Castle Financial Solutions is going to be hosting a Safe Money Strategy seminar on Thursday, July 20th. We're going to repeat that same seminar on Tuesday, July 25th. Carrollwood Country Club. And that's just going to start at 6:30 p.m. and we'll actually provide some food for you. It probably won't be filet mignon because the country club is going to be there, but hopefully you don't come for the food even though it'll be provided. Hopefully you come for the information and to learn how you can develop a safe money retirement roadmap.

Producer:
Now the food is just going to be the the proverbial cherry on top. And, you know, maybe you'll actually have some kind of dessert with a cherry on top. You never know. But that'll be a good, good thing for folks. I know. And just a lot of great information. So yeah, if you like what you hear on the radio or on the podcast, definitely go in person there for that event coming up here.

Producer:
Look forward to seeing you. Yeah.

Producer:
Couple just a couple of weeks from now. Well, all right. So so moving on here, Greg, let's talk about you know, I talked about earlier as we were starting the show, being proactive rather than reactive when it comes to planning for your retirement. So, you know, this sort of goes along with that theme that you were talking about earlier, which was, you know, have a plan, have a plan, have a plan. Right? And so this means being proactive is you've got a plan and you're putting that plan in place. So let's talk about some things that you can do now that our listeners can do to really be proactive and and not be reactive when it comes to planning for retirement.

Greg Castle:
Think one of the best examples, this is something that happened recently, and that was with some bank failures like Silicon Valley Bank and some others where people learned very quickly as to begin to react to the fact that they haven't adhered to this. And that is, don't keep more than $250,000 in a single bank that protects you and your family from volatility inside the banking sector. So we recommend keeping significantly less than the FDIC limit in the bank in general, because most banks offer very low interest on your deposits while inflation eats away at your spending power. Banks, not the best place to keep your money, especially if you want it to grow very quickly. Now, banks have you know, they've stepped up a little bit and they're just rates have gotten better on savings accounts and some money market accounts and CDs. But there are still better safe money opportunities out there than bank CDs. And if we've got a banker listing, please don't get mad at me. I'm just stating the facts. Another thing you can do is establish a retirement income plan today by replacing the bond portion of your portfolio with alternative income producing investments that offer market like gains without market risk. You know, bonds can actually go down. You know what you pay for by you actually can you run a deficit.

Greg Castle:
So another thing you can do is take advantage of the only two types of tax free investments that are out there that I know of anyway. We've already talked about those. And that's a Roth IRA. So you can start a Roth IRA set up automatic contributions. You can also convert your existing tax deferred retirement savings into a Roth IRA by implementing a Roth conversion. Now, I will qualify that and say that we talk you know, we talk about Roth conversions a lot, financial advisors talking about it a lot. There are certain circumstances where Roth conversion may not be the best option for you. And without knowing your situation, I don't want to get into any alternate strategies right now, but you need to talk to somebody to see if a Roth conversion is going to be good for you. Also, the Roth is one way to to basically take advantage of tax free investments. The other we've talked about time and time again and there's life insurance products and life insurance can offer a death benefit in case you die too soon. But it's also a great tool to build your retirement savings and generate tax free income in your golden years.

Producer:
Another way to.

Greg Castle:
Be proactive and less reactive would be to work with a legal expert, you know, help have them help you put a will in place for your financial wishes and or your final wishes in a state. If you don't have a legally binding will, your family could be in court for years while your final affairs are trying to be settled by the state through probate.

Producer:
And, you know.

Greg Castle:
Make sure you have a plan for when your spouse passes away because. Unless you both die in a car crash, plane crash, or just happen to eat the same bad food in the same day, the likelihood of one of you surviving the other is extremely probable. It could happen to either one of you. I'll expected my mom would pass along before my dad. She had a lot of health issues. Didn't happen that way. And so you never can tell who's going to be the the last to survive while working with a financial advisor or a professional, you can feel confident that your retirement is not at risk. Should you or your spouse pass away sooner than expected. Oftentimes the spouse who was a do it yourself retirement planning expert passes away, leaving the surviving spouse with questions and no one to turn to to find out exactly what was going on. According to statistical data data from the World Health Organization. Globally, men have lower life expectancy than women. According to Jeff Foxworthy. That's because they want to. But anyway, the we don't want to go there. I suggest that men are more likely to pass away before their female partners in marriages. And although it's important to note that life expectancy is just an estimate and is influenced by many factors, you know, still. Just bear in mind that either spouse could predecease the other. Be prepared for the widow's tax by meeting with us or reading our free report. The information is yours today when you reach out to us. We'll send you a report on

Greg Castle:
Understand how your Social Security benefits are calculated and make a plan for when you'll start receiving it. Understand also that the 2021 Social Security trustees report projected that the program's trust fund reserves are going to be depleted somewhere around 2033. And at that point, unless our elected officials, you know, do something to address the shortfall, Social Security beneficiaries could potentially face a reduction in their benefits. That projection is projected to be somewhere between 25 and 33%, not just for those people that would apply after that. But the current projection is that every Social Security beneficiary, including those that are currently drawing Social Security, could be impacted by that. So we want our clients to to have a solid income plan in case Social Security can't make payments as expected. You've got to factor that in. And probably the last thing is going to be to determine your big budget items before you retire. If you have plans to pay for family weddings or grandchild's education, you want to plan for that in advance. Additionally, if you know you want to travel a lot in your 60s, 70s, 80s, you're going to want to budget for a vacation fund that suits your needs. So if you want to learn more about how you can get personalized safe money retirement roadmap and make sure that you have the money to do those things and avoid some of the things that we just talked about, then give us a call at (813) 430-7100 or shoot me an email at Greg@SafeMoneyMasters.com.

Producer:
Easy ways to reach out there. And as we continue on here, Greg, we've got some some very important information to share with our listeners that we've touched on just a little bit here or there. But let's go into just a little bit more detail now about it because we brought it up a couple of times, but we want to sort of dive in to a couple of steps to take to avoid a retirement tax bomb. People could have this this big tax bomb just waiting to go off as soon as they retire and not even know it. So so let's let's discuss that and maybe ways to defuse that bomb before we get there.

Greg Castle:
But too often we find that people are keeping most of their retirement savings in tax deferred accounts, such as work based 401 seconds, 403 B's TSP, or even an IRA. And while we're happy to see that so many people are saving for retirement, what concerns us is the taxes you're going to pay when you finally have to withdraw that money spend in retirement. So there's there's, for example, tax deferred. Tax deferred means that you haven't paid taxes on that money yet. The government will eventually, you know, force you to take that money through what's called required minimum distributions or RMDs. And any time you withdraw money from these accounts, you're going to owe taxes on that money. An example, let's say that you made it to retirement. You and your spouse are both in your 60s and you decide that it's time to go in that bucket list. Vacation. Maybe it's a trip to Europe. It could be a cruise or even a great American road trip to visit some of our national parks. Vacation will be three weeks and the budget is going to be $10,000. However, when you withdraw the money from your tax deferred retirement account, you're going to owe money on. You're going to owe taxes on that money. For this example, let's say your federal tax rate is 24%.

Greg Castle:
So pull up my handy dandy calculator here. And with 24% going, Uncle Sam, you only have $7,600 for your trip. If you need to spend $10,000 for this vacation, you would need to withdraw $13,100 to cover both taxes and expenses. So what's the solution? Take advantage of tax free investments and implement Roth or. Implement a Roth conversion if it's appropriate for you. You will no longer have RMDs because RMDs are not taken out of Roth accounts. And you can you can withdraw the money tax free. So meanwhile, the money that you keep invested in the account will grow tax free. You should choose to leave your Roth to a beneficiary after your pass. That money will be passed down tax free. So, you know, Roth's have great advantages over traditional IRAs. If you have the option to to have a Roth. By all means, you should. You should consider that. So if you're interested in maximizing your retirement savings and learning what a Roth could do for you, or even if a Roth is appropriate for you, a Roth conversion is appropriate for you, then get in touch with us at Castle Financial Solutions Group at (813) 430-7100. As always, our consultations are complimentary and there's never any obligation.

Producer:
Well, Greg, just about well, a little over five minutes left here on the clock as I as I look at it, ticking away. But I wanted to get to these ten key resolutions for a sound financial plan. We can kind of go through these here pretty quickly. Um, you know, resolutions usually made at the beginning of the year. We're like halfway through a little over halfway through now. And so as we're entering this kind of latter half of the year, the third quarter, it's probably a good time to sort of take stock, you know, and sort of take a step back, look and see where we are and maybe make some mid-year resolutions to keep your retirement plan on track. So we got ten of them here. Greg, let's run through resolution number one. If you don't have an investment plan, make one.

Producer:
Yeah, I think we probably.

Greg Castle:
Ought to do here is why don't we cover these very quickly and maybe come back and cover them more in depth in another episode. Yeah. So resolution number one, if you don't have an investment plan, make one. You know, for example, if you're trying to lose weight, it's not going to happen if you wing it. It's the same with investments. Resolution number two would be rebalance, re rebalance even the diversified portion of your portfolio. Market fluctuations over the past year may have distorted your asset allocation away from whatever you settled on your investment plan. If allocations are 3 to 5% different from your target amounts, then it's time to rebalance. But do remember that rebalancing can are taxable accounts can create capital gains. Resolution three would be build up your emergency savings fund, as we've already talked about that as a general rule of thumb, we should aim to have enough to cover 3 to 6 months of expenses in case you lose your job. Resolution for pay down debt. I mean, pay down debt. Pay down debt, pay down debt. You need to be debt free as before you go into retirement, if at all possible. Resolution five cut spending. Uh, that just goes without saying, is that there's a transition period. You've got the accumulation phase where you want to get your money as fast as you can, grow your money as fast as you can.

Greg Castle:
You want to take risk transition phase, you wind down, you cut spending, you begin to transition from more aggressive investments to more conservative investments and cut spending to help reduce that. The next one is going to be to maximize your company investment plan at work. 401 K 403 B TSP. Make sure you invest enough to get your full match that's offered by your employer. Anything over and above that might be better suited to, you know, for outside investments outside the company. Resolution seven Update your estate plan. If you don't have one, you need to get one and we can help you with that. We have a network of professionals that we can refer you to that are very good at trust, estate planning, those type of things, and we can help you with that as well to make sure we're incorporated into your retirement plan. Resolution eight. Check your Social Security record if you do nothing else today. If you don't have one already, go to tsa.gov again. Ssa like Social Security Administration SSA gov to create an account if you don't already have one because you need to look at your for several things. Number one, look at your earnings history. Take a look and make sure that Social security is is not being that your social security account has not been hacked some way.

Producer:
Number nine, Check your credit report.

Greg Castle:
Go to the three bureaus. Get your credit report. Your scores range from 3 to 8. 380 to 850. 740 is considered to be good. That'll save you some money when you go for to apply for credit. And then number ten would be create financial planning, create a create a financial planning owner's manual. In other words, make sure your loved ones know you know what they have, where to access it, and who do you call to get it. So if you're worried, if you're tired of worrying about your future, you're ready to learn how to create a safe money retirement account or roadmap. Simply pick up the phone. Give us a call at (813) 430-7100. Or email me personally at Greg@SafeMoneyMasters.com. Also, don't forget if you like what you hear on the show, you know we are hosting a Safe Money Strategy seminar on Thursday, July 20th, and they're going to repeat it again on Tuesday, July 25th at Carrollwood Country Club at 6:30 p.m. We don't have time for this week in history, however. There are some special days for today. So today is.

Producer:
National Blueberry.

Greg Castle:
Muffin Day. National Free Slurpee Day. Go to 7-Eleven and pick you one up. It's also, by the way, National 7-Eleven Day, believe it or not. It's also National Swimming Pool Day and National Mojito Day. So I'm going to grab a blueberry muffin. I'm going to go down to 7-Eleven. Give me a free Slurpee. I'm going to come home, fix a mojito, and I'm going to go to the pool. So it's not a good plan, doesn't it, Matt?

Producer:
That sounds like a great day to me. Greg, I love that plan.

Producer:
All right.

Greg Castle:
So I think it's a I think it's sort of a wrap for the show for today. And Matt, thank you for all your contributions and for your time today.

Producer:
No worries, sir.

Producer:
Thank you. I appreciate all of your insights, as usual.

Greg Castle:
Well, with all that said, we hope the listeners have enjoyed the show. Hope you'll tune in next week on the same bat time.

Producer:
Same bat channel.

Greg Castle:
All right. Have a great have a great week, folks. Take care. See you next week.

Producer:
Thanks for listening to Safe Money Masters with Greg Castle. You deserve to work with a financial expert who has a track record of helping clients exceed their financial goals by implementing safe and proven strategies to schedule your free No obligation consultation with Greg. Visit SafeMoneyMasters.com.

Producer:
Not affiliated with the United States Government. Greg Castle 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. 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 the results obtained from the use of this information.

Producer:
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.

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