Retirement Ready

July 5th, 2025. 

Episode Transcript

Speaker 1 (00:03):
Live from the wgy iHeart Studios. Welcome to Retirement Ready
with your host Dave Kopek from the Retirement Planning Group.
Every week, Dave and his team discuss the ways they
can help people make informed decisions about their retirement assets
to maintain, improve, and secure their desired quality of life.
Here's your host, Dave Copek.

Speaker 2 (00:25):
Hello, and welcome to the Retirement Planning Show. My name's
Nicholas DIMIs.

Speaker 3 (00:29):
Certified financial planner with the Retirement Planning Group. Alongside me
today I have Christopher McCarthy and Christopher Kopek, and we're
here to discuss some pre and post retirement planning, mostly
on the pre side. If you want to call our
office to talk about your own unique situation, you can
give us a call at five one eight five eight
zero one nine nine. This is a pre recorded show,

(00:52):
so we're not doing any call ins today. But again,
if you want to call our office anything spikes your interest,
that number is five one eight five zero.

Speaker 4 (01:02):
Nine.

Speaker 3 (01:03):
And when I mentioned pre retirement planning, I wanted to
bring up annuities. You know, I think a lot of
folks out there have a bad reputation with annuities or
they have a bad reputation, so maybe they're just misunderstood
as well. You know, I've got an article here it

(01:23):
says four out of five Americans can't even properly define
an annuity.

Speaker 2 (01:27):
So maybe it's just the fact of the unknown that
scares them.

Speaker 3 (01:31):
So we want to sit down today and kind of
describe the different types.

Speaker 2 (01:37):
Of annuities that are available for folks out there.

Speaker 4 (01:42):
I think it's an important topic. Like you were saying earlier,
a lot of people have a bad taste in their mouth,
but they haven't had the opportunity to really educate themselves
on all the different areas that people could really benefit
from them.

Speaker 3 (01:57):
Yeah, and it doesn't have to be you know, your
full retirement count or your full four oh one K
deferred count, whatever you've accumulated throughout your lifetime.

Speaker 2 (02:05):
You don't have to turn that into an annuity.

Speaker 3 (02:07):
You know, you can take a piece of it and
provide some baseline income, which we talk about on the
show quite a bit. So you want to make sure
you have an an adequate amount of resources coming in
each month to take care of your baseline expenses. You know,
an annuity might be the appropriate vehicle to do so.
So MacArthur. You've been doing it for what forty years?

Speaker 4 (02:27):
Forty years yep.

Speaker 2 (02:29):
And you specialized in annuities yep.

Speaker 4 (02:32):
Pretty much my whole career and what I love about
since joining all of us here, we got a great team.
Only about three to five percent of all the investment
management we do of annuity, but we understand that they
have a very important place and if the situation is
right and it's a good fit for the client, we

(02:55):
need to look at it, and that's what we do.

Speaker 3 (02:58):
Yeah, I completely agree with you, and you know, I
think Chris also has seen, you know, a few scenarios
where annuities.

Speaker 2 (03:05):
Have worked out well for clients.

Speaker 3 (03:07):
You know, your father has been doing them for years,
so we see the back end of these annuities. You know,
if they purchased them back in twenty ten or twenty twelve,
you know, you had those thirteen fourteen years of growth
on the annuity contract and now we're finally turning those
annuities on to generate income for retirees.

Speaker 5 (03:28):
Yeah.

Speaker 6 (03:28):
Yeah, there's a lot of ways that they can help
in different situations, you know, satisfying that baseline income that
we always talk about, and like you were hinting at
earlier is that it's a it's a portion of the
overall allocation for people and satisfying you know, your income

(03:49):
in retirement can be done by carving off you know,
your largest asset, which is probably your four to one
K or your whatever that may be that you've been
saving in for your entire career. So you take you know,
twenty five percent of that. See what you can do
and what you know, income can be generated off an

(04:09):
annuity for the remainder of your life to you know,
help supplement social Security if you don't have a pension,
and just help that, you know, baseline income in retirement.

Speaker 3 (04:21):
Yeah, you need three things in a portfolio, right guarantees,
you need liquidity, and you need growth right G LG
That's how I like to describe it. But the first
G guarantees you know, the annuity right, that provides a
parachute for a lot of folks, you know, depending on

(04:42):
which type you choose, and it can also provide guaranteed income. Right,
so as far as investment returns, you can purchase what
are called writers on these annuity contracts which will provide
a guarantee growth rate on the contract. And then guaranteed
income at a certain point in your life. So if
you're someone that doesn't have a pension, right, you've worked hard,

(05:04):
you've contributed to a four to oh one K, but
you don't have any sort of pension.

Speaker 2 (05:08):
The only real.

Speaker 3 (05:09):
Pension you're gonna have a Social Security once you reach
you know, sixty two or sixty seven or whenever you're.

Speaker 2 (05:14):
Gonna turn it on.

Speaker 3 (05:15):
And I knewity might be an option for you, right,
taking a lump sum from your four oh one K
or you know, twenty five thirty percent of that value
and trying to figure out, you know, what can that
provide me for a monthly income? What can that provide me,
you know, on an annual basis, so that if something
happens to me, my spouse is taken.

Speaker 2 (05:35):
Care of as well, you know.

Speaker 3 (05:37):
And just pillow planning is what we call it, right,
being able to sleep at night knowing there's a paycheck
coming in next month.

Speaker 4 (05:44):
I think it's very important also to realize when people
look at the back of a one dollar bill and
they look over the pyramid, one of the words is
a newer tie. It's Latin for two pey. So if
you're sitting there and receiving a New York State pension
or state and federal or local government pension, federal pension.

(06:07):
Those are all forms of annuities, and people don't even
realize they have one. And like you said earlier in
the in our talk here, this is something that just
needs to be looked at. Many people out there do
not have any other guaranteed income stream other than Social Security.

(06:32):
So if you can take all your hard earned money
and look to see it doesn't have to be an
immediate annuity where your money is fosen. There's so many
different setup for annuity. You can have your money fully
invested and still receive a monthly income stream for the

(06:53):
rest of your life and still have your money fully invested.
So it's not worth poopo annuities until we have an
opportunity to sit with people, educate them on what's out
there so they can make an educated decision if it's
right for them.

Speaker 3 (07:11):
Four out of five Americans do not know what an
annuity is adult Americans, so that's concerning, right.

Speaker 2 (07:20):
And we had a seminar.

Speaker 3 (07:23):
Recently with an annuity wholesaler and he was able to
describe some different products that might fit for individuals out there,
and I think it was a very educational seminar that
we had, and it just goes to show, you know,
a lot of people are curious that they want to
understand what these products are. You know, in the fifties

(07:45):
and sixties, pensions started going away right in the past.

Speaker 2 (07:49):
A lot of people thought, you know.

Speaker 3 (07:51):
I'm gonna work hard and this company's gonna take care
of me when I go into retirement and.

Speaker 2 (07:54):
Continue to pay me a monthly income stream.

Speaker 3 (07:57):
That wasn't the case after a lot of those pension
those pensions started vanishing.

Speaker 2 (08:02):
So what did the government do. We started creating deferred
compensation plans.

Speaker 3 (08:06):
Right, so four oh one k's pre tax accounts that
are turning into an issue. And you heard the Gentleman
talk about that on at that seminar on Wednesday.

Speaker 4 (08:16):
Yep.

Speaker 5 (08:17):
Yeah, he did a good job.

Speaker 6 (08:19):
I think he did a really good job at explaining
you know how these there's two overall avenues that we're
looking at currently in the annuity space. One is obviously
the pension, generating your own pension, getting guaranteed income for
the remainder of your life, and then the other one
was you know, putting a belt in suspenders, as my
father would say, on your account, and it's the buffered product,

(08:44):
you know, having a ten or twenty percent downside protection
on your money. And the way he phrased it, you
know when he's going through and going over, you can
get more than market participation in some of these products.
Is it's not too good to be true. It's too
good to be free and too good to be liquid,
you know, so, and too good to be free is

(09:04):
the pension product, which is the you know, guaranteed income
for life, and that's that's, you know, a product where
you're satisfying income for the remainder of your life. And
if you're getting into that, you're looking for a pension
and then the buffered product is just downside protection. So
being invested in you know, an ENDOC like the S

(09:25):
and P five hundred and having either ten to twenty
percent downside for a certain segment of time that you
that you're giving up liquidity on that money for. So
it's definitely something that if people are interested in, you know,
there's options out there for them.

Speaker 5 (09:42):
And these are fairly new products even to us.

Speaker 6 (09:45):
So that's why you know that informational UH was not
only beneficial for you know, the people that participated and
showed up, but even ourselves.

Speaker 4 (09:53):
You know what I found very impressive, Well, the number
of people that were asking question right, the presentation with me,
not only between the gentlemen from the company, but also
your father. Yeah, and the interaction the participation I was
really happy with because you could tell I think a

(10:16):
lot of people, whatever their perception was about the annuities,
it was different than what they actually sat and learned about.
And I thought it was a great evening. I really did.

Speaker 2 (10:29):
Yeah, and some nice appetizers.

Speaker 3 (10:31):
I think I ate a whole plate of cantalope and
it was a really good presentation. So are these annuities
right for everyone?

Speaker 4 (10:39):
No?

Speaker 3 (10:39):
Right, there's individuals out there that it's not suitable for,
but you know a majority of people and I think
it is, you know, just looking at these products and
giving them ideas. I think Chris brought up a great
point also about the fees. Right, A lot of people
think these are super expensive. It depends on the product
that you get involved with.

Speaker 2 (10:58):
Right.

Speaker 3 (10:59):
If you're gonna to provide a guaranteed income source for
the rest of your life, you're gonna pay for that, right.
It just like the sunroof on your car or having
air conditioner.

Speaker 2 (11:09):
You're ACU working.

Speaker 3 (11:11):
My truck is currently not working, so I did not
choose that annuity option with my truck. But again, you're
going to pay for those guarantees associate with the contract.
You know, some of those parachute you know, buffered products,
they have lower fees, right because liquidity is the cost.
You know, you can't get in and out of those
as as fast. But again, even like the gentleman was describing,

(11:33):
there are some products that do have liquidity.

Speaker 2 (11:36):
With those buffered products.

Speaker 3 (11:37):
So again it's a very difficult landscape to understand for
the basic you know investor out there, But we can
educate you and form you and show you examples that.

Speaker 2 (11:50):
May benefit you.

Speaker 3 (11:51):
So again, if you want to call our office and
schedule an appointment and see if one of these products
might fit your portfolio, you can give us a call
at five point eight five eight zero one nine one nine.
Again that's five one eight five eight zero one nine
one nine. We also have a website to check us
out at www dot rpg retire dot com and it's

(12:13):
rpgretire dot com on the web.

Speaker 2 (12:16):
And uh and again just kind of scroll through the website.

Speaker 3 (12:18):
We have a question box on there if you want to,
you know, submit any questions to us. If you're too
scared to pick up the phone and speak to one
of us because we bite, then that's fine as well.
So again, uh five one eight five eight zero one
nine one nine. We're gonna take a quick break again.
My name is Nicholas Dumas, certified Financial Planner with the

(12:39):
Retirement Planning Group. Alongside me Chris and Chris the CNK
of the Retirement Planning Group. So we're gonna take a
break and we will be back right after this.

Speaker 7 (12:51):
The eighty six percenters, do you know that eighty six
percent of the population has no defined benefit pension plan.
For most of us, we have to take our life
savings and create a paycheck for the rest of our
lives in retirement. What is your plan for retirement income distribution?
How you manage your assets during the most critical years
of your lifetime. Nobel Prize winning economist William Sharp has

(13:11):
called retirement income distribution the nastiest, hardest problem in finance.
He points out that investment, uncertainty, and mortality can derail
the most careful laid out retirement income plan. Call our
offices today to start the process of building a retirement
income distribution plan. After forty one years of being in
the financial services business, you need to start taking action

(13:32):
to start building your own personal retirement income distribution plan.

Speaker 5 (13:36):
How do you do that?

Speaker 7 (13:36):
To take action? Five one eight five eight zero one
nine one nine. That's five one eight, five eight zero
one nine one nine or RPG retire on the web.
Don't procrastinate, motivate to start building your retirement income distribution plan.
Five one eight five eight zero one nine one nine.
You've spent a lifetime saving for retirement. Now it's time
to make that money work for you. Here's the secret

(13:58):
most people miss. You have to create your own retirement
income plaint. Social Security is not enough, pensions are rare.
You need a strategy that turns savings into monthly income
that will last a lifetime. At the Retirement Planning Group,
we build customized income distribution plans so you can retire
with confidence, retire smart, Live well full eight eight eight
five eight zero one nine nine for your complementary consultation.

Speaker 1 (14:22):
News Radio Waight ten and one o three one WGY Thanks.

Speaker 2 (14:26):
For tuning in today.

Speaker 3 (14:28):
This is a Retirement Planning Show, got Nico, Chris and
Chris speaking to you through whatever sound system you're listening
to this on Did you ever see that show?

Speaker 5 (14:41):
Which one, No, I don't worry about it.

Speaker 3 (14:44):
But again is the Retirement Planning Show. Today we're speaking
on annuities, so we wanted to, you know, bring it
up and start describing the different types of vehicles that
are out there for retirees to start planning their hronment
and where that next paycheck is going to come from,
because when you put that two week notice in, you

(15:05):
know that paycheck is going to stop coming in also,
so you need to make sure you have a plan.
No plan is a plan and it's a bad plan.
So again, I think an annuity might be an option
for you. So before the break, we were describing, you know,
some different types of annuities, income annuities versus you know,
there's buffer annuity products out there now as well, which

(15:27):
we're seeing a lot of inflow in. But I want
to break down what an income annuity is, how they work,
how they grow.

Speaker 2 (15:35):
Over time, and how income is generated.

Speaker 3 (15:37):
So I know I'm throwing a lot at you McCarthy,
but you know you are the expert, so I'd like
you to go through.

Speaker 4 (15:43):
I certainly wouldn't go that part. All right, Well, I'm
just happy to be here. But like you said, this
very there's a lot of different annuities out there. It
is our job to make sure that if an annuity
it's a good pit, what type of annuity is the
best bet. And like you said, I have worked with

(16:06):
annuities pretty much all my forty years in the business,
and there's many different types. The ones that we specialize
in and you're referring to, is an income annuity. It
gives you a very unique ability that you from day
one can fully invest your money. That will always be

(16:29):
the case. And while investing your money, you create an
income based which is an amount that your payout will
be based on based on your age. And it just
goes like you said earlier, your money's working for you.
It's invested. You're getting an income stream that from day one,

(16:53):
you build a base minimum income stream with the ability
every year to give yourself a raise. That raise is
because of whether it's a five or six percent simple
roll up, or you have a good year in the
market and you lock up at the higher income based level.

(17:15):
It's it's a lot to take in, Yeah.

Speaker 3 (17:18):
But I think high level. You know, it was a
really good good job describing it. There's two values with annuities, folks, right,
so Chris was just describing you know, the income benefit.
There's an income benefit, and there's also the contract value.
So when you invest, you know, let's say you put
two hundred thousand dollars into one of these annuity products,

(17:40):
you know that two hundred thousand dollars going is going
to be invested. You know, you can choose your asset allocation.

Speaker 2 (17:46):
You know.

Speaker 3 (17:46):
They might require a minimum amount in fixed income. You know,
so maybe you can only have eighty percent in the
stock market, but you have to have twenty percent in
some sort of fixed income or bond product. You know,
but you can invest that money and try to beat
the five or six percent simple growth that's going to

(18:07):
be associated with the income base.

Speaker 2 (18:10):
The purpose of these contracts, you know, while you.

Speaker 3 (18:12):
Hold them and don't turn on the income, is to
try to get them to grow, you know, and if
you can beat the five or six percent, then, like
Chris mentioned, you get a step up, which is great,
So that income benefit will step up to that new
contract value. If your investments perform well, and then next
year it'll grow by the five or six percent, simple

(18:33):
depending on the contract. So so again you want to
try to grow those two numbers to the highest you
can before you turn the income on. And then from there,
depending on your age, there's going to be a withdrawal
amount that's available to you.

Speaker 4 (18:46):
Correct.

Speaker 6 (18:47):
Yeah, and depending on I just wanted to throw into it,
depending on you know, what you're looking to do. If
you're going into like this income product, what we'll do
with the investments, like Nico is saying, if they have
like an underlying bond requirement where you have to have
about twenty twenty five percent in the bonds, then we

(19:10):
will just go as aggressive as possible in the equity
side of it, you know, or will recommend that, you know,
because the bond once you meet that bond allocation, whatever
the requirement is, the goal of the investments is to
beat the five to six percent, like Nico was saying.
So you want to try and you know, outperform what

(19:32):
you're what the guaranteed rate is on the growth to
get those step ups, you know, to continue to outperform
in the contract and lock in like a higher guaranteed
income amount that you'll eventually receive once you start taking
the income.

Speaker 4 (19:48):
I think one of the benefits. Again, we can't emphasize
this enough. The income annuity we're talking about is for
people that do not have a lot of guestuaranteed income
each month plan for retirement. This is a beautiful way
to consider setting yourself up for a guaranteed self funded pension.

(20:13):
And this is really where we have found the best fit. Now,
if you're fortunate, you've got strong social security, you have
a strong pension, that's wonderful. Your need or desire to
look at this type of product may not be as
great as someone who just has Social Security at their

(20:37):
only form of guaranteed income. So what we're trying to
do is we're trying to facilitate as many avenues for
an individual or a couple that they can sleep at
night knowing that even with their money fully invested, even

(20:58):
with markets ups and down, they have a baseline income
already established in the hope that it can only be
increased in time.

Speaker 3 (21:09):
Yeah, one of the biggest concerns with retirees is running
out of money, right, and these income products are going
to guarantee an income.

Speaker 2 (21:19):
Stream for the rest of your life.

Speaker 3 (21:20):
You know, maybe not only your life also maybe also
your spouse's life. You know, maybe when you elect to
annuitize or turn on the income down the line, you
choose some sort of period certain, right, so it's based
on your life plus you know, ten years period certain,
so if something happens to you you've passed away, it's
still going to pay out to your kids or your nephew,

(21:42):
your niece, you know, for the remaining six five, four
years that are left on that ten year period.

Speaker 5 (21:50):
Certain.

Speaker 2 (21:50):
So when you do get to that.

Speaker 3 (21:52):
Age where you're ready to turn on the income, you
just retired and this account's been growing for the last
seven or eight years, you know, and and now you
need to make a decision. Right, you get to that
age and you decide, hey, I just want this for
my life. You know, I have these other assets. Maybe
I have a life insurance policy that's going to pay
out to my kids.

Speaker 5 (22:10):
So the.

Speaker 3 (22:12):
Loss you know that the inheritance is there for the
for the children. Now you focus on yourself, right, and
creating an income stream that you're going to feel comfortable
with and and and annuitize that and turn it on
based on you know how old you are and what
that withdrawal benefits going to be.

Speaker 2 (22:31):
So I think they're great products.

Speaker 4 (22:33):
And I think this is another strong point to emphasize
because I think part of the reason many people may
have a little bad taste in their mouth about annuity.
This is not an annuity where you give the insurance
company a block of money and then they're going to
tell you you're going to get a guaranteed income per

(22:54):
month for the direct of your life and you lose
access to your money. That is an immediate annuity. We
are not talking about them. We're talking about a variable
annuity with an income benefit writer. Your money is available
to you, your money is fully invested. You will have

(23:18):
access to your money in the future with the hope
that as we do better, your money grows, your income
base grows, your income grows. It's a very very attractive
avenue for people that do not have a lot of
guaranteed income.

Speaker 3 (23:37):
And we're definitely not saying to just go and buy
one of these products, right.

Speaker 2 (23:41):
They need to be suitable. You need to understand what
you own.

Speaker 3 (23:44):
Right, So if you do purchase an annuity, or if
you have an existing annuity and you're not sure what
it is, or what it's doing, or how it's invested,
or what it's going to provide as far as income
down the line. We'd be more than happy to take
a look at that annuity. So the only thing that
we really need as a statement. You know, a statement
tells a thousand words to us. We're able to see
when it was purchased, if they're surrender charges of associate

(24:08):
with the contract, what the current income amount would be.

Speaker 2 (24:11):
And you know, also how it's performed.

Speaker 3 (24:14):
We're really able to dive into, you know, how it's
done over the last you know, five ten years, however
long ago you bought it. But again, you know, we
just we take a look at that statement, see what
you have. You know, if it's a non qualified annuity,
so a non retirement annuity, there may be better vehicles
or more tax efficient vehicles for income payout, you know,

(24:35):
through a different company. So so again, we do a
lot of work with annuities. I've seen hundreds of annuity
statements and I'm sure you've seen thousands. So I think
we've got the experience here to understand what you own
and try to figure out the best game plan for
you forward.

Speaker 4 (24:53):
I think another very important point you were talking about suitability.
If people only how much paperwork have to be submitted
for each annuity that is written. This is not something
that anybody can just sell on a whim. We have

(25:13):
a lot of channels that need to be approved to
make sure that we're doing what's right for the client,
so we don't have to worry about the ethics. But
we have to submit all our paperwork to broker dealers.
We have to be in compliance with fin the sec

(25:33):
so on and so forth. This is something that is
a very calculated avenue that needs to be explored and
we need to abide by. So it's it's a very
strong contender. Like I said earlier, for people that don't.

Speaker 7 (25:52):
Have eighty six percent, do you know that eighty six
percent of the population has no defined benefit pension plan.
For most of us, we have to take our life
savings and create a paycheck for the rest of our
lives in retirement. What is your plan for retirement income distribution?
How you manage your assets during the most critical years
of your lifetime. Nobel Prize winning economist William Sharp has

(26:14):
called retirement income distribution the nastiest, hardest problem in finance.
He points out that investment uncertainty and mortality can derail
the most careful laid out retirement income plan. Call our
offices today to start the process of building a retirement
income distribution plan. After forty one years of being in
the financial services business, you need to start taking action

(26:35):
to start building your own personal retirement income distribution plan.
How do you do that? To take action? Five one
eight five eight zero one nine one nine. That's five
one eight, five eight zero one nine one nine or
RPG retire on the web. Don't procrastinate, motivate to start
building your retirement income distribution plan. Five one eight, five

(26:55):
eight zero one nine one nine on you gy.

Speaker 6 (26:58):
All right, and we are back. So we just you know,
hit on the income products. So the next thing to
hit on is the buffered products, the Belton suspender products
where they you get a ten or twenty percent downside
protection on your assets. This is something that is a

(27:18):
compliment or can be a compliment to the other product,
and it's where your money is fully invested in. You
know one of the major indices like the S and
P five hundred, and you can choose you know which
time frame you're looking to invest your money in whether
it's a one year, a three year, or a six
year time frame, and then you get to choose, you know,

(27:42):
how much of a protection do you want on the
downside risk, so that's either ten or twenty percent on
the downside, and in some cases, you know, you get
more than market participation, so that's you know, you can
outperform the indossy. So the insurance companies can offer this
because you are losing the liquidity on your money, although

(28:04):
there are some products where your money is completely liquid
to you. And let's dive into it.

Speaker 4 (28:11):
Mister McCarthy, Well, I think it's very very important that
we explain what we mean by liquidity. It's a very
important topic when you're looking at these products. They come
in one, three and six year buckets. Like Chris said,
what it is is you're buying a cycle of time.

(28:36):
So in the one year bucket, if you want to
achieve the potential of that bucket, you have to hold
the money in for the year, same with the three year,
same as the six year. Now, if we're going to
take a step back and look at liquidity period, we're
fortunate enough that we can offer these annuities to client

(28:59):
there's no handcuffs, there's no surrendered charge period. We set
it up that they can get in and out of
the product as little or as often as possible. There
will not be any sales chargers. The only thing with
these products is, like every other investment we work with

(29:20):
clients we build, we have it a fee agreement. Will
charge a fee that will be the only cost to
the clients. So from a liquidity standpoint, can I get
in and out of this product? Yes, In order to
achieve the rewards with each bucket, you have to stay

(29:44):
in for the year, or the three year or the
six year. I think it's very very important that people
understand that.

Speaker 3 (29:50):
Right.

Speaker 2 (29:51):
Are you someone that's scared of the market.

Speaker 5 (29:54):
Right?

Speaker 3 (29:56):
These are for folks that, you know, they want market exposure,
but they want protection in case the market doesn't do well.
You know, there's a lot of things happening, you know, geopolitically,
there's bombs flying around right now, interest rates are high,
inflation slowed just good. You know, we've got a really

(30:19):
really hot market right now. You know, the last two
years market was up twenty five, twenty five. You know
this year market's up what five?

Speaker 5 (30:29):
Yeah, Yeah, we've bounced back.

Speaker 3 (30:30):
So we've had, you know, two really good years. Twenty
twenty two the market was down, we've come back. Your
account values are probably above where they were beginning of
twenty twenty two. You know, maybe it's time to look
at that for one k or ira or whatever account
you may have, whether it's a non qualified account or
a qualified retirement account, and start taking some of those

(30:53):
gains and getting it into a vehicle that's going to
provide some protection. On the downside, you know, God forbid,
the market does drop.

Speaker 2 (30:58):
Over the next year, next three years.

Speaker 3 (31:01):
You know, it's it's not a bad idea to put
some you know, put a parachute on your account, especially
as you get closer to retirement. You know, are we
saying that this product is suitable for everyone. No, you know,
but if you're someone that's nervous or you know, you
think you've you've had a really good run, you've been
one hundred percent equities and you've just said, you know,
forget about it, I'm just going to keep it there.

(31:23):
The market is resilient over time. You're getting to a
point now where you're gonna have to start taking income
off your account. You can't afford a twenty percent downswing
and I got a million bucks. It's two hundred thousand dollars.
Say you retire next year and you wanted to take
fifty thousand a year, You're down to seven hundred and
fifty thousand dollars in your account when originally it had
a million, right, and just because of poor market timing

(31:44):
on your exit into retirement, now you're struggling to make
ends meet. So again, I think it makes sense for
the people that are getting closer to retirement, maybe they're
four or five years out from retirement. In the red zone,
which we like to call it. You should be doing
a lot of planning in the red zone. And I
think this is a vehicle that makes sense for people
that want some protection on their portfolios. Now you can

(32:06):
get market exposure, like Chris said, you get even you know,
better participation. So some of these products, if the market
does one hundred percent, you're up what one hundred and
ten percent or one hundred and five percent, So again,
they give you some upside potential with downside protection. So
I think they're great products.

Speaker 4 (32:26):
You know what I love about working with you guys.
I've learned so much over the last year and four
months i've been affiliated, So I'm a perfect example. You
can teach an old dog new trick. We've been very
fortunate and even though the annuities are only three to
five percent of our overall book of business that we

(32:48):
manage for client, we are finding that this is having
a stronger and stronger present. For example, three years ago,
interest rates were next to zero before inflation started the skyrocket.
Times like that. The product we're talking about right now

(33:12):
is going to be hotter than pancakes because we didn't
have a lot of avenue that we could guarantee some
rate of return for our clients. Now we have solid
income portfolios made up of bonds and equity funds that
we've done very well for clients. Interest rates are coming

(33:34):
back down. There's going to be less choices for people
to go other than the equity market. So what better
way to get into the equity market with downside protection.
I think it's a win win. I think it's a
win win how people. I don't think people can afford

(33:56):
not to look at this. Didn't mean you're going to
do it, but we're here to educate and we'll be
the first one. If you're not a candidate, We'll tell you.

Speaker 5 (34:07):
Yeah, I agree.

Speaker 6 (34:09):
I think it's I think it makes a lot of
sense for a lot of people to look in this area.
And that's kind of why we're we're talking about it
is because, like McCarthy just said, ninety percent of our book,
you know, ninety to ninety five percent of what we
do is manage assets. So that's through model allocations that
we build in office and manage you know, rollover iras

(34:31):
for clients or individual accounts and that sort of you know,
asset management. But you know, we kind of see the
industry as a whole, you know, shifting more and more
towards these variable annuity products as they get more and
more competitive with you know, asset management through a fiduciary
financial advisor. So utilizing these and learning more about them

(34:55):
is you know, something that since McCarthy joined US has
been you know, you know, very at the forefront of
like what we're trying to do this year. And having
that you know seminar was great and talking to a
lot of these different wholesaler representatives, you know, learning more
and more about you know, how these products work and
how they fit into an overall portfolio. The more you

(35:17):
learn about them, you know, the more they start to
make more and more sense. And I think it's just
informing people more about you know, what's out there and
what's what's going on, and you know, these different market
situations and how it can help because like you said,
you know, if if someone's scared wants s and P
five hundred like returns, yet they're nervous about you know,

(35:40):
the downside. Oh man, I don't want to take a
twenty percent hit. I can't do that over the next
five six years. But they got cash sitting on the
sideline that's in you know, the bank where rates are
going to come down. You know, your money market's not
going to get you four or five percent anymore. If
rates start coming down, you know, it might come back
down to two. Well, that's not really that competitive anymore.

(36:00):
So shifting some of that money off the sidelines and
getting it into a product that is in the S
and P five hundred but has a ten to twenty
percent downside eraser, you know, is is great. And I
think to hit on like how that eraser works is
good too.

Speaker 5 (36:18):
You know, we should probably dive into that a little bit.

Speaker 6 (36:21):
And how you know that first ten or you go
into the ten or the twenty. You know how the
how the buffer actually you know works in the product.

Speaker 4 (36:30):
I think it's essential everybody, regardless of what happened, you
have been that thing you're doing. We always want to
outperform inflation. If we are not earning enough, we're losing money.
It may not be losing money in a negative or
read on a statement, but we need to outperform at

(36:52):
minimum what inflation. And this give people a great opportunity
to get in to a program where they can have
downside risks like you just shared with market returns and liquidity.
I mean again, what was so heartwarming I think recently

(37:16):
at that seminar was the participation of the audience and
all the questions that were being asked, because I think
a lot of people were turned on in a positive,
positive way that annuities are not what they thought they were.
They were much more comprehensive in nature, offered much more

(37:39):
because back in the day, all the really was was
fixed intric annuities. You know, then there was a slow evolution.
What's offered right now is more than I've ever seen
in forty years. Yeah, there's a lot to look at
there's a lot of scenarios that annuities make sense. Well.

Speaker 6 (37:59):
I think that also goes to like the insurance companies
probably we're listening, you know, over the last thirty to
forty years. They're like, man, we're getting a bad rap.
You know, we got to release some products that make
sense for the everyday investor where it's more competitive with
like an asset management firm like ourselves. Like they needed
to find where they what avenue could they take up

(38:23):
that asset managers are doing for their clients. And you
know what we can do is we can build out
an income model and you know, you know, generate as
much interest and dividends as we possibly can. But we
can't say that, you know, we can guarantee lifetime income
from your account, but these products can now guarantee lifetime
income for your money that you're putting into them, or

(38:44):
guarantee downside protection. You know, we can't guarantee downside protection
in your account and through an asset management you know,
putting you in a model allocation, whether it's a sixty
forty or seventy thirty, however you're invested. But that's I
think where they found their neiche and in the word guarantee.
You know, when you tell someone you have downside protection

(39:04):
or self funding a pension and guaranteed income for life.
You know, those two uh talking points are very attractive
for a lot of you know, every day investors.

Speaker 2 (39:15):
What does everyone want?

Speaker 3 (39:16):
Everyone wants market participation with no risk. So I think
this is definitely a topic that needs to be addressed
with you know, majority.

Speaker 2 (39:24):
Of folks out there.

Speaker 3 (39:25):
But again, this is the retirement planning show our numbers
five one eight, five eight, zero nine one nine. If
you want to sit down and have a chat. Everyone,
We got to take another break and we'll be back
right after this.

Speaker 7 (39:37):
We are living through the greatest wealth transfer in the
history of mankind. Trillions of dollars of wealth will change
hands from one generation to the next. Your money to
our beloved children and grandchildren. Are you ready? Your future
is written by chance, it's written by action. Now's the
time to build your plan, protect your assets, and position
yourself for the opportunity. Don't wait, take action. The future

(39:59):
favors those that are prepared well. Eighty eight five eat
zero one nine one nine. That's eighty eight five eats
zero one nine one nine one wgy.

Speaker 3 (40:10):
Everyone thanks for tuning in today as the Retirement Planning Group,
Nicholas Dumas here with Chris McCarthy and Christopher Kopek, and
on today's show, we've been discussing annuities, you know, the
ins and outs. You might be tired of listening to us,
but we're going to keep talking anyways, because I think
they make sense for a lot of people out there

(40:30):
that are either looking for an income stream looking from
for some sort of protection that an insurance company will provide.
You know, these are insurance vehicles right at the end
of the day, so that insurance company is absorbing, you know,
either the first ten or the first twenty percent on
these buffered products, the risks associated with the market loss.

(40:50):
So I think, Chris, do you want to go through
that a little bit more and the downside protection and
how that works.

Speaker 6 (40:56):
Yeah, So as far as like you know, the protection
on the in the buffered product, so ten percent or
the twenty percent. You know, you got two options as
far as how much protection you want on your invested assets.
So the ten percent, you know, you say the market's
down fifteen, it's going to erase the first ten of losses,

(41:17):
so your account would be down somewhere around five. And
then if you're within the buffer, so market's down eight, whatever,
you'll you're flat. You know your account you know at
anniversary will be flat. And if you're up, great, you're up.
You know, you're the market. You've made money over the
last year. And there are you know, caps on the

(41:37):
upside for some of the products, and they're different and
they're you know, they're varying on how much market upside
potentially you can capture. Uh and that's you know, the
downside to getting into one of the buffered products. But
you know the benefit of the buffer products is avoiding loss.
You know, how much loss can we mitigate in these
downside markets over a period of time. And then the

(41:59):
twenty percent buffer works the same exact way. So the
twenty percent buffer, you know, markets down ten after your
timeframe that you're in the product for your flat you know,
the market's down twenty five. You know, congratulations, you're down
five and everyone else is down twenty five. So it's
just it erases, you know. The you got to think
of it as like that's your max amount of losses

(42:22):
you can erase ten or twenty. So however much protection
you want to put on your assets or your investments
is you know, whichever product you know, we can sit
down and review all the different scenarios and all the
different you know, upside potentials with the different time frames,
if it's something that interests you.

Speaker 5 (42:42):
But yeah, did I miss anything, MacArthur.

Speaker 3 (42:44):
I think people, oh sorry, go go. I think people
need to light a fire, right, you need to get
moving on these products. I think they're in a great
point right now. In the past, we've done work with these,
you know, over the last six seven years.

Speaker 2 (42:59):
You know, these cap for a lot lower.

Speaker 3 (43:01):
You know, you looked at a ten percent downside or
fifteen percent downside protection and the cap was maybe seven
percent on the upside for the most you can get
for that year with seven percent or eight percent, you know,
now you're looking at over perform or outperforming the indexes
right up to a certain cap. So I think some
of those are like three hundred percent or something crazy

(43:22):
like that. So so again, these caps are better now
annuity companies are competing to try to win your business,
so they're offering better vehicles to do what you're trying
to accomplish. So I think they are at a good
point when the FED starts decreasing rates, they might change
cap rates as well, so lighting a fire and getting going.

(43:44):
While these options are available, and while these participation rates
are so high, I think makes a lot of sense.

Speaker 4 (43:51):
I couldn't agree more. I mean there's a lot of
valuable that go into what they set. As you guys
have explained you. As far as we cannot talk about
all the different setups and a buffer annuity over the radio,
it's just impossible, there's too much to say. It's definitely

(44:15):
something worthwhile in person where we can look at a monitor,
go over different scenarios, different avenues that are available to you.
It's kind of mind boggling how many different setups that
you can have.

Speaker 6 (44:33):
Well, they make it fully customizable to whoever you know
is looking for the product, which is a good thing.
It's not a bad thing, it's a good thing.

Speaker 4 (44:40):
But I'll tell you, I think the most powerful thing
for anybody listening is who wouldn't give up some upside
gain to ensure downside protection? I think that really is
what it comes down to. Like, Christy did a great job.
You know, if you're in the s and P. Five

(45:02):
hundred and a down five percent and you got a
ten percent downside buffer, you didn't lose any money. You're
at zero. Right If the S and P was down
fifteen percent and you got a ten percent buffer, SMP's
down fifteen, but you're down five. A lot of people
would be happy only being down five verse fifteen. So

(45:27):
they're just exciting product. There's a lot of different avenues.
In order for us to really get into different features,
it's really got to be one on one. We need
to see in person, go over over a monitor. But
I know this is going to really blow away a
lot of people.

Speaker 3 (45:46):
They're tax advantage tax advantaged products as well for non
retirement accounts. Right, So if you take money from the
bank and put it into one of these products, you
can go in and out of indexes without being taxed
on the dollars over the you know, three six or
six years that you hold. You know your buffered product,
you're deferring all that tax liability. And then you could

(46:09):
take the money at the end of it and in
ten thirty five into a different product and use it
for income if that's something you're looking to do.

Speaker 2 (46:15):
So you know, you could do a buffer growth strategy.

Speaker 3 (46:19):
And then on the back end turn it into some
sort of sort of income stream for the rest of
your life, if that's an option as well. So these
are very customizable. There's a lot of options out there.
They're insured up to five hundred thousand dollars by New
York State Insurance Fund, so even if the company were
to default, you know, New York State will step up

(46:39):
and covers that first five hundred thousand dollars per individual investor.
So again, they're great products, and I think a lot
of people just don't know about them, you know. And
if you don't know, then you tend to not move forward. Right,
So you need to know all the ins and outs
of a vehicle before you purchase, like a truck or

(47:01):
a car. But you also need to know all the
ins and outs of a variable annuity or a buffer
annuity before you make that decision as well.

Speaker 4 (47:10):
These are great things to consider also for legacy planning
estate planning. One thing about annuities, when we went through
the Secure Act and they went from taking the inherited
eye arrays that people used to be able to excuse

(47:34):
me stretch over their lifetime, now they have to take
them out over ten years. The non qualified stretch is
still the only lifetime stretch that I'm aware of that
was unaffected. So a lot of people that are leaving
money for their children, their grandchildren. These types of annuities

(47:54):
are excellent for legacy planning. A lot of people that
are doing a state planning.

Speaker 3 (48:00):
Especially if you're uninsurable so you can't purchase a life
insurance contract. You know, these annuity products might make sense
because you don't have to go through a physical.

Speaker 4 (48:10):
Absolutely, that's a great or a combination. Well, there's a
lot of different ways that these can be set up
and coordinated that you really can maximize not only income
and investment potential, but also a legacy and a state planning.

Speaker 3 (48:30):
I mean, yeah, let's say if you if you do,
you know, qualify for life insurance as well. So let's
say you're someone that does have a death benefit on
your head or you and your spouse's head that's going
to be paid out to your children when you pass away.
You know, you've done all your state planning work. You
have an irrevocable trust set up or revocable trust, and

(48:50):
that insurance policy is going to get paid out to
that trust. And instead of giving the trustees the right
to access that you know lump some that gets deposited
into the trust. You have some dictations in there to
where it's going to purchase some sort of lifetime annuity
for your kids and then it's going to pay them
out of monthly income stream versus you know, receiving a
four or five hundred thousand dollars lump some. You know,

(49:13):
you see this for a lot of families who are struggling.
The kids may be struggling with you know, addiction or
alcoholism or gambling problems. So again, you want to give
them a monthly income stream versus this lump sum of cash.

Speaker 2 (49:28):
That's going to be placed on their desks.

Speaker 3 (49:30):
So again, I think it's a great estate planning legacy
type of play that can really create some generational wealth
or generational income for you.

Speaker 4 (49:39):
No, I couldn't you know, like I said, And I've
been around the block a long time and it's get
amazing to me the evolution of the whole annuity business.
And you know, for people to take the time like
they did at the seminar, and we will have future seminis.

(50:00):
The participation was great and I really loved seeing because
you could tell people were enjoying learning more about it
and that their perception was not what they thought it was.
And I know we've already had a number of people
that call up for appointment and it's wonderful. It's heartwarming

(50:22):
because you're doing a good service and I think it's valuable, right.

Speaker 6 (50:27):
And the thing is for the advisors out there, if
your advisor isn't bringing up these products to you or
at least mentioning them that they're available or out there,
it's probably because they're not licensed to even provide them
for you. So it's you know, the reason that we're
bringing them up is because they've just come into the
light as far as being very competitive now. So it

(50:49):
makes a lot of sense to talk about them and
bring them up and at least explain them more to
people to get them, you know, a better understanding and
feel more comfortable about them. Because if it makes a
lot of sense for you know, a large majority of
the people that we meet with, then it makes sense
to talk about So that's why, you know, the seminars
make sense, you know, having the wholesalers come in and

(51:10):
explain them to people if need be, just to get
to people to understand that these products do exist, you know,
you can self fund a pension, you can add downside
protection onto your investments. So there's a lot of different
avenues out there that these insurance companies have become, you know,
a lot more competitive in the space of asset management.

Speaker 3 (51:32):
So we're running up on the end of the show. Here,
is there one more thing you want to say? McCarthy.

Speaker 4 (51:38):
I just think that we pride ourselves so much as educators.
It's our job to educate our clients what's out there,
find out where they are and what their goals are,
and how can we best meet their goal. Nothing is
off the table, including annuities. If it's a good fit,

(51:59):
we're going to look at it. If it's not, we're
not going to waste your time. But I think it's
so important let the client make the decision, and it's
up to us to help them make the most educated decision.

Speaker 5 (52:14):
Right.

Speaker 3 (52:14):
So we're gonna put options in front of you and
you know, discuss who you are and what you're looking
to accomplish. You know, half our job is listening and
then the rest is you know, putting these options in
front of you so you can make an informed decision
on what you're doing with your assets.

Speaker 2 (52:29):
So everyone. This is this was the Retirement Planning Show.

Speaker 3 (52:33):
If you want to call our office numbers five one eight,
five eight, zero, one nine one nine again that's five
one eight, five eight, zero, one nine one nine everyone.

Speaker 2 (52:42):
Thanks for listening today. We'll see you again next time.

Speaker 1 (52:49):
Thank you for listening to the Retirement Planning Show boasted
by Dave Kopec. If you would like to talk with
Dave or someone at the Retirement Planning Group, called five
one eight, five eight zero, one nine one nine five
one eight, five eight zero one nine one nine during
business hours, or visit RPG retire dot com. The Retirement
Planning Group has five convenient offices located in Albany, Malta,

(53:12):
Lens Falls, Syracuse, and Oneata. Tune in again next week
for retirement planning strategies with Dave Kopek right here on WGY.

Speaker 6 (53:26):
The information or services discussed on this shows for informational
purposes only and is not intended to be personal financial advice.
The investments and services offered by us may not be
suitable for all investors.

Speaker 5 (53:37):
If you have any doubts as to the merits of
an investment, you should seek advice from an independent financial advisor.