Episode Transcript
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Speaker 1 (00:00):
Welcome to the hidden world of wealth, where secrets of
the affluent become accessible to you. You are listening to
Your Money Matters, the most provocative financial radio show on
the airwaves. You are about to start your educational journey
here on Your Money Matters with your host, Drew Prescott,
(00:22):
President of Prescott Private Wealth and Chartered Retirement Planning Counselor.
Drew will unlock the complexities of the financial landscape with straightforward,
powerful insights. Whether you're planning for retirement, managing in a state,
or looking to grow your wealth. Consider this your exclusive invitation.
Turn up the volume, lean in closer. Let's navigate the
(00:45):
hidden paths of prosperity together. Your financial enlightenment begins now.
Securities all produce a terror Financial Specialists LLC Member fen
the SIPC reservices offered through Setara Investment Advisors LLC SOTERA
firms are under separate ownership from any other named entity.
(01:06):
Four five to one. Who's Sixth Street, Troy, New York
one two one eight zero.
Speaker 2 (01:34):
Welcome back, everybody. You are listening to Your Money Matters
and I'm your host, Drew Prescott, Chartered Retirement Planning Counselor
credited wealth management advisor and president here at Prescott Private Wealth,
located at four to fifty one. Who's extreet in Troy,
New York, And thank you for tuning in today. Very
excited to have you here and appreciate your support every weekend.
(01:57):
And I'm excited to have you join me today as
we discuss some strategies that you should consider before you retire,
because retirement is a journey that requires careful planning and
avoidance of common pitfalls. And today we'll cover the five
biggest mistakes that could derail your retirement. You know, retirement
(02:18):
is something everybody dreams about. It's some think about it
how soon they can retire, and while others really focus
on making sure that they have enough money saved. So,
whether you're just starting your career, you're midway through, or
maybe you're nearing retirement, it's crucial to avoid simple yet
(02:39):
costly mistakes. And today I'll break down these mistakes and
give you actionable steps to secure your financial future. So
have you heard the staggering statistics? According to a twenty
twenty four study by Employee Benefit Research Institute, nearly forty
percent of Americans aged thirty five to sixty four have
(03:03):
saved less than fifty thousand dollars for retirement. Now that's
an alarming number. So, considering how long retirement can last
and how expensive life can be, even if you've been
diligently saving, you might still be making costly mistakes near strategy.
(03:23):
So let's put it in perspective here. We're living longer
and often we're well into our eighties and beyond, and
medical advancements and healthier lifestyles they've extended life expectancy now.
But this also means that you'll need to make your
money last much longer, and that's not easy when life
(03:44):
is full of unpredictable events like illnesses, disability, divorce, and
even natural disasters as we've seen recently. But all of
these can derail even the best laid savings plan. So
today I'll share tips on safeguarding your financial future and
will answer crucial questions like is my portfolio well balanced?
(04:08):
Am I maximizing my contributions? And at what age should
I claim Social Security? We'll also address how to build
a retirement plan that's not just about numbers, but about
your dreams and your goals. And mistake number one is
not having a retirement plan. So let me introduce you
(04:30):
to Jim and Linda. Jim was a sixty two year
old factory worker who had been contributing to his four
oh one K for decades, and his wife, Linda. She
managed the household finances and assumed that their savings were enough.
They'd planned to retire. They wanted to travel, but they
didn't really have a written plan, and when Jim had
(04:51):
a health scare at sixty three and had to retire early,
that's when they realized that they hadn't saved enough money
to cover their expenses, let alone travel the world as
they had planned. Now, unfortunately, many Americans make this same mistake.
They assume that social Security will cover their needs, and
that's not the case in most scenarios. So let me
(05:13):
ask you, do you think that eighteen hundred and eighty
two dollars per month, which is the average social Security
benefit for twenty twenty four, do you think that that's
enough to live on? For most people?
Speaker 1 (05:25):
It is not.
Speaker 2 (05:26):
And social Security is a great supplement, but it is
not a comprehensive plan. So to avoid this mistake, start
out by writing down your retirement goals, like where do
you see yourself in retirement. Are you gardening, are you
guys traveling or maybe starting a new hobby or a business.
(05:48):
Will Studies show that people with written retirement plans have
five times more money saved than those who don't. So
writing down your goals forces you to think about the
costs that are associated with retirement, and it allows you
to create a roadmap. So take control of your savings.
(06:10):
At age fifty nine and a half. You can begin
withdrawing from your four toh one K or your IRA
without an early distribution penalty. But just because you can
do that does not mean that you should. Your retirement
savings are like your primary income source, and early withdrawals
(06:31):
could leave you financially short in your latter years. So
workers that are aged fifty and older can make what
we call catch up contributions to both iras and four
to one ks. So for twenty twenty four, the limits
are seventy five hundred dollars for iras and thirty thoy
(06:53):
five hundred for four to one ks. Now, these increased
limits are a golden opportunity for late savers to close
the gap on their retirement goals, so take advantage of
them if you have not already. Now, Mistake number two
is not knowing where your money goes. Now, budgeting may
sound simple, but it's critical. And if you don't know
(07:14):
how much you're spending, how can you actually ensure that
your savings will last. Now, this mistake often sneaks up
on people because expenses in retirement they can change dramatically.
For instance, healthcare costs tend to rise. We know that
you may travel more frequently in your early retirement years,
and new hobbies and leisure activities can also increase spending.
(07:37):
So let's talk about numbers for a second here. According
to a twenty twenty four study by Fidelity Investments, the
average sixty five year old couple will need three hundred
and fifteen thousand dollars simply to cover healthcare costs throughout
their retirement. Now that's just healthcare, So if you add
(07:59):
in living expenses, travel, and inflation, you can see how
easy it is to outspend your savings. So here's a
pro tip for you. Create a detailed budget for your
retirement and be realistic about your needs and your wants,
and also account for inflation. Well, if you're working with
(08:21):
a financial advisor, they can help you do this analysis,
and they can analyze your spending patterns and make adjustments
to ensure that your money lasts. Now, this takes us
to mistake number three, making sure that your money lasts,
because underestimating longevity is a major threat to your financial
(08:42):
picture and retirement. And here's a question for you, how
long do you expect to live? Now, if you're in
good health, there's a high probability that you'll live into
your late eighties or even nineties. Now, this longevity is
absolutely a blessing, but it also means that your retirement
saving must last longer than ever before. So consider this.
(09:06):
A balanced portfolio with a mix of stocks and bonds
historically provides better long term growth than keeping your money
in cash or low yield investments. Now, it's important to
review your portfolio regularly and adjust it, and you're going
to want to adjust it based on your risk tolerance
(09:28):
through time. In addition, we want to look at your
time horizon and your financial goals. Now, the financial goals
is key because that leads us into mistake number four,
which is failing to plan for unexpected events. Because life
is unpredictable. As we all know, you might face a
(09:49):
serious illness, need long term care, or deal with a
natural disaster. Now, how prepared are you for these possibilities
above and beyond your find financial goals? Well, insurance is
a pivotal part of your retirement plan. Long term care insurance,
for example, can help cover the cost of nursing homes,
(10:10):
in home care, or assisted living facilities. Now, without it,
these expenses can really drain your savings. And similarly, disability
insurance can protect your income if you're still working and
unable to perform your job duty to illness or injury.
Now let's turn to mistake number five here, and what
(10:34):
we'll do is, as the show keeps going on, I'll
unpack each one for you later on as well. Okay,
so I'll give you some opportunity to take some notes
and some actionable steps that'll be helpful for you. Now,
mistake number five is ignoring estate planning. So let's just
talk about something that most people avoid, which is a
state planning. So without a valid will, your assets may
(10:58):
be subject to state probate laws, which can be time
consuming and expensive for your loved ones. So state planning
isn't just about wills, It's also about designating your beneficiaries
on your accounts and creating a power of attorney for
medical and financial decisions. And this ensures that your wishes
are honored or even if you become incapacitated, So your
(11:23):
retirement starts here. Planning for retirement doesn't have to be overwhelming.
So whether you're thirty five or sixty five, the best
time to start is now. So to help you avoid
these common mistakes, I've created a free guide that's titled
the five Things that Can Derail your retirement. If you
(11:45):
want it quick, feel free to send me an email
Drew at PRESCOTTPW dot com leave me a voicemail at
five one eight two zero three one nine eighty three.
But if you want to take a moment and go
over to our website at PRESCOTTPW dot com, you will
see it right inside of our blog and you can
help yourself there. So how do we avoid mistake number two? Well,
(12:12):
in our next piece here, we're going to dive into
the importance of knowing where your money goes. Budgeting and
understanding your expenses are critical, as we've said, so don't
go any place. I'll be starting here with more insight
on securing your retirement that you've always dreamed of. So
(12:33):
if you're just joining us here today, you're listening to
your money matters. I'm Drew Prescott, President Wealth Advisor at
Prescott Private Wealth, and I hope you can find a
value in our discussion up to this point about the
five things that could derail your retirement, because these pitfalls
are more common than you think, but with the right strategies,
they're also completely avoidable. So if you'd like a copy
(12:55):
of this guide the five things that can derail your retirement,
simply call us A five one eight two zero three
one nine eighty three or PRESCOTTPW dot com and you'll
find it right in our blog section here. Now, the
second biggest pre retirement mistake is putting your savings in
the wrong place. So let's dive into mistake number two,
(13:18):
placing your hard earned savings in the wrong place. Retirement
planning is not just about saving money, it's about growing
that money and in the right way. So let me
share a story about Sarah. Sarah had inherited seventy five
thousand dollars from her mother, and like many people, she
wanted to keep that money safe, so she put it
(13:39):
in her bank, getting a standard savings account, and it
sat there for years untouched. So now here's a question.
Do you know what the average interest rate on a
bank account is in twenty twenty four? This number is
gonna blow you away. Uh, but it's only aboutero point
four percent. So that means that her seventy five thousand
(14:00):
dollars grew by less than three hundred dollars per year,
barely keeping up with inflation. So imagine instead, if Sarah
had taken that money out and invested it in a
money market fund or a roth ira or even a
high yield savings account. Over the years, that difference could
(14:21):
have been tens of thousands of dollars. Now, if she
had invested it, it could have grown to be something
very significant. Now, this is a mistake that I see
far too often is that people are so concerned about
keeping their money safe that they don't let it grow.
And what they do not realize is that being overly
(14:42):
cautious can actually cost them. So traditionally, when you're dealing
with a financial advisor, they recommend that as you approach retirement,
your portfolio should become more conservative to minimize risk. So
while this advice might make sense on the surface, today's
(15:05):
economy is telling us a different story because we're living
longer than ever before, and according to the Social Security Administration,
the average retirement lasts about twenty years, and nearly half
of women who are sixty five today will live on
to see the age of ninety. And that's a long
time to make your money last. So here's where being
(15:27):
overly conservative can be just as dangerous as taking on
too much risk. So let's say that you move all
of your money into bonds or certificates of deposits CDs
to play it safe. So while these options are less
volatile than stocks, they also provide lower returns, and if
(15:47):
inflation rises, which is currently hovering around three to four
percent annually in the US, your purchasing power could shrink
significantly over time. Now, to put it in another way,
your retirement savings must not only last longer, but they
also need to work harder. So what is the role
(16:11):
of stocks in a retirement portfolio. Well, stocks often get
a bad reputation for being too risky, especially for retirees,
but here's the reality. Over the long term, stocks have
consistently provided higher average returns than bonds or cash. Yes,
(16:31):
they are more volidile in the short term, but when
held in a diversified portfolio, they can help you outpace
inflation and grow your wealth. So think about it this way.
If you're sixty five today, you could easily live another
twenty five to thirty years. Now, that's long enough for
your portfolio to weather the ups and downs of the
(16:53):
market and still come out ahead. So why does diversification matter. Well,
here's another common mistake. People think that they're diversified because
they own several mutual funds. But often these mutual funds
hold the same stocks, which means that you're not truly
spreading your risk. True diversification means spreading your investments across
(17:17):
small cap and large cap stocks, international funds, bonds, real
estate investment trusts, and alternative investments such as commodities or
private equities. Now, the goal here is really to create
a portfolio that isn't overly dependent upon the success of
any one sector or market. For example, if the US
(17:40):
market takes a hit, your international investments or bonds could
help cushion that blow. And I like to say that
diversification is like an umbrella, sunglasses, and a raincoat all
in your bag, if you're prepared for whatever the weather
or the market throws at you. If you're prepared that way. Now,
(18:03):
the importance of setting realistic expectations is very important because
another challenge that retirees face is overestimating returns. So if
you're expecting an eight to a ten percent annual growth
but your portfolio is delivering four to six percent, you
could run out of money much faster than you had planned.
And this is where working with a financial advisor becomes
(18:25):
critical because advisors can help you set a realistic expectation
based on your risk tolerance, time horizon, and retirement goals,
and they can help you adjust your plan as needed,
ensuring you to stay on track. Now, what we need
to do again, as we said earlier, is to stay
(18:46):
on track is budgeting, so knowing where your money goes.
So let's shift gears for a moment and talk about that.
Do you know how much you spend each month? Now
many people may think so, but we see that a
lot of people underestimate their expenses, especially in retirement, and
it's a myth that retirement automatically means spending less. In fact,
(19:11):
I always tell people as we're planning for retirement, you're
probably going to spend the same amount and potentially more
in the early years of retirement because you've got these
pent up goals and travel plans and everything else that
you want to do. Now, as you get a little
bit older, your propensity to consume kind of goes away.
(19:36):
So I always tell people, and no offense out there
to anybody, but I say, you know, in the beginning
of your retirement, if you retire early, well you got
a lot of life ahead of you, and you're going
to probably pick up new hobbies and stay quite busy.
If you're someone that retires at sixty five or seventy,
I always say, you know, from sixty five you've got
(19:58):
a solid price no. Ten, possibly fifteen years of really
staying active, golfing and traveling and doing all these things, gardening,
all these things that you really love. Now, when you
get to eighty, I don't care who you are, you
slow down a step by the time that you are.
(20:18):
If you're still healthy and you're at eighty five years old,
you still are not as busy as you ever were.
And then when you get a little bit older, maybe
you just need a warm blanket and some hard tack. Candy,
but you don't need nearly as much money any longer.
So when you spend more time in your early retirement years,
(20:43):
as you travel, and like I said, as you pick
up new hobbies or you complete home improvement projects, you're
gonna need a little extra juiceter in those times. So
let's not forget what we covered earlier, which is a
healthcare cost. Remember how I refer to that twenty twenty
four study by Fidelity with which found that the average
sixty five year old couple will need three hundred and
(21:03):
fifteen thousand dollars to cover health care expenses in retirement.
And that's a significant expense that many people fail to
account for. So again, here's a pro tip for you.
Create a detailed retirement budget that includes not just your
daily living expenses but also your healthcare, travel, and inflation.
(21:25):
And revisit this budget annually because this does change and
you're going to have to make adjustments as your needs change.
So here's a question that I want to have you
reflect on for a second. You personally, have you kept
a realistic budget and have you overestimated your returns? So
(21:47):
that's that's a dangerous place to be because retirement is
not the time to guess. It's the time to plan strategically,
and financial advisors can help you with that by creating
a comprehensive budget, diversifying your portfolio, maximizing your retirement contributions
help you plan for unexpected expenses, and they can also
(22:11):
help you navigate complex decisions such as when to claim
social Security or how to maximize taxes on your withdrawals. Now,
I always get a good laugh out of people that
say clients even that say yeah, I think I've decided
I'm going to take social Security at this time and
blah blah blah. Anytime I've ever heard a client say
(22:34):
that and tell me their philosophy behind why, the reasoning
seems a little flawed. So I take them through a
maximizer with social security just to educate. Now, I would
say probably eight times out of ten they kind of
(22:57):
change their strategy after learning the facts about social security. Now,
good for them, Good for you for reviewing what you
think your social security strategy should be. But you really
need to work with a professional to make sure that
you have the actual number and you have a plan
in place, because you can't choose your proper social security
(23:21):
date without having a financial plan that's written by a professional.
So if you're unaware about your current retirement plan or
you want to avoid these common mistakes, I'd love to
help you. Here at Prescott Private Wealth, we specialize in
guiding individuals and families through every stage of retirement planning.
(23:41):
And if you're listening today and you'd like to receive
a free guide to the five things that can derail
your retirement, call us at five one eight two zero
three one nine eight three, email me at Drew at
PRESCOTTPW dot com, or go to PRESCOTTPW dot com under
blog and you'll be able to see this that I
prepared for you. Now, the next mistake that I want
(24:06):
to cover here is underestimating longevity. And in order to
tackle this common pitfall of underestimating how long you live
and how much money you'll need, it is crucial to
plan for the long haul. So stay tuned because we're
(24:26):
going to cover that here. And I want to make
sure that again you're getting some actionable steps that can
be productive for you and your family in retirement years.
And again, if you're interested in receiving a copy of
these steps, feel free to call us. You're listening to
your money matters. I'm your host, Drew Prescott, chartered retirement
(24:48):
planning counselor and accredited wealth management advisor at Prescott Private Wealth,
located at four fifty one, who's extreet in Troy, New York.
Feel free to keep an eye on our blog. I
keep that updated weekly Prescott dot com. So when you're working,
your weekends are primarily spent at the office. Right, did
(25:10):
I say weekends? I think I said weekends. I didn't
mean too I wanted to say weekdays. So when you're working,
your weekdays are primarily spent at the office. Now, your
free time while you're working is limited to just evenings
and weekends, right, And that's when most discretionary spending occurs.
When you're dining out, you're shopping, you've got recreational activities,
(25:31):
or maybe you've got weekend getaways. Well, now imagine that
every day in retirement is like a Saturday. Without a
plan or a budget, it's going to be easy for
spending to start to spiral out of control. So what
starts as an occasional treat, now it starts to turn
(25:53):
into a lifestyle that drains your retirement savings faster. Than
you had expected. So here's the hard truth. The Federal
Reserve reports that the median retirement savings for Americans is
just sixty thousand dollars, So for people that are aged
fifty five to sixty four, it's only one hundred and
(26:15):
three thousand. So let's be honest, how far will that
really get you when you consider the average retirement last
twenty to thirty years. This is why it's important to
start saving as early as possible. So when is the
best time to start saving for retirement? The answer simple,
(26:37):
It was yesterday, but then second best is today. So
in twenty twenty four, the IRS increased the annual contribution
limits for four toh one ks to twenty three thousand dollars,
with an additional seventy five hundred dollars catch up contribution
(26:57):
for those of you who are over the age of fifty,
bringing it to thirty thousand, five hundred. Now, iras now
allow contributions up to seven thousand dollars with a one
thousand dollars catchup for older savers. So if you're starting late,
(27:18):
the stakes are high. According to Vanguard founder Jack Boggle,
individuals who begin saving in their forties should aim to
contribute twenty five percent of their income to catch up.
So while this may sound daunting, it really underscores the
importance of starting early. Now. Waiting too long is one
of the biggest regrets that retirees express. The earlier that
(27:43):
you begin saving, the more time your money has to
grow through the power of compound interest. So another component
that you're going to want to pay attention to here
is healthcare, and that's the elephant in the room now.
One of the most underestimated retirement expenses is healthcare. So
(28:06):
even if you're healthy now, it's almost inevitable that you'll
face rising medical costs as you age. The rising cost
of healthcare is awfully steep now. According to Fidelities twenty
twenty four estimate, the average couple retiring at sixty five
will need approximately three hundred and fifteen thousand dollars to
(28:29):
cover their healthcare expenses during retirement. Now, this includes your
Medicare premiums, deductibles, out of pocket expenses for prescriptions, hospital visits,
and other things. Now, it's also important to note that
Medicare does not cover everything, and the key exclusions for
Medicare that are excluded are dental envision care, hearing aids,
(28:56):
and most long term care needs. So failing to account
for these gaps can lead to significant financial strain. So
supplemental insurance such as metagap or Medicare advantage plans, they
can help fill some of these gaps, but they come
with additional costs. Now, if we look at the long
(29:18):
term care side of things, more than seventy percent of
retirees will require some form of long term care. Now
this might include in home care, it could be assisted
living or a nursing home. Now, the costs here are
absolutely staggering. The median annual cost for assisted living in
(29:39):
twenty twenty four is now fifty four thousand dollars, and
a private room in a nursing home averages one hundred
and nine thousand per year. Now, every market's different, so
this is just an average number. Now, the trend is
clear that these costs are only increasing. Long term care
(30:00):
insurance is a way to prepare, but the earlier that
you purchase it, the more affordable it will be. And
Melanie Hagen, who's a senior care expert, she put it bluntly.
She said, buy long term care insurance or make a
plan for who will care for you if you face
(30:20):
a serious medical condition that prevents independent living. Now, this
kind of planning is more than financial. It's about preserving
your peace of mind and protecting your loved ones from
bearing the burden. Now, I don't have this study in
front of me, but there was a study that was
done years ago, and there's been plenty of specials out
(30:43):
there as well that talk about when one spouse requires care,
the spouse that is providing the care tends to age
quicker and their health declinents faster than the individual that
initially required care. So the emotional strain, the physical strain,
(31:07):
all of that comes into play, which also ties into
a strain on their health. So that is why it's
very important to have a plan put together as just
simply a way of reducing the burden for your loved ones. Now,
let's talk about the importance of diversification, because we can't
talk about retirement savings without discussing diversification. Now, some retirees
(31:32):
shy away from the stock market entirely, believing that it's
just too risky, but avoiding the market all together can
be just as dangerous, if not even more so. Now,
conventional wisdom says that the stock market is risky, but
avoiding it all together can be even riskier if your
money cannot keep pace with inflation, and that is something
(31:55):
that you need to keep in the forefront of your mind. Now,
you want to balance risk and reward because the stock
market may experience some short term volatility, but it has
historically delivered higher returns over a long term compared to
bonds or cash. And a diversified portfolio one that includes stocks, bonds,
real estate, and alternative investments it helps you balance risk
(32:20):
while still capturing growth. So here's an example. If you
place all of your money in bonds or CDs, you
might avoid market downturns, but you'll also likely lose purchasing
power over time due to inflation. So a mix of
asset classes ensures that you're prepared for different market conditions
(32:41):
while maximizing potential returns. Now, let me give you a
couple of actionable steps for planning for retirement expenses. The
first would be create a realistic budget. Now, a budget
is your first line of defense against overspending, and I
would courage you to account for both fixed costs like
(33:02):
housing and variable costs like travel and dining. Out, but
don't forget to include healthcare, inflation and other potential surprises.
The second area that I would like to point out
is to increase your savings. Now. Maximize contributions to retirement
accounts like your four toh one ks and iras, and
(33:25):
if you're over fifty, take advantage of these catch up
contributions to help accelerate your savings. The third thing that
I would say to take a note for is plan
for healthcare costs as we've been talking about, and investigate
supplemental insurance options to cover gaps in your medicare, and
(33:45):
if long term care insurance is right for you, purchase
it sooner rather than later. The fourth component here is
diversify your investments. Work with a qualified financial advisor to
ensure that your portfolio is diversified across multiple asset classes,
because this reduces the risk while keeping your money working
(34:10):
for you. Now, the fifth piece here would be update
your plan regularly. Now, retirement planning is not just a
set it and forget it, so you want to review
your plan annually to account for changes in your expenses,
health and market conditions. So why partner with a financial advisor?
(34:31):
Because a financial advisor navigates the complexity of your retirement expenses,
and that can feel overwhelming when you go at it
by yourself. So that's where a trusted financial advisor really
comes in. Advisors can help you create and manage a
comprehensive budget, strategically allocate your investments, account for rising healthcare
(34:56):
and long term care costs, and also help you stay
discipline and focused on your long term goals because retirement
it's one of the most significant financial transitions that you
will ever make, and with the proper guidance, you can
avoid some of these pitfalls and create a secure financial retirement.
(35:18):
So if today's discussion is really resonating with you, don't
wait to take action. Call five one eight two zero
three one nine eight three or go to Prescott PW
dot com. You can schedule a time with me right
on the website, go into New Clients and UH you'll
see that there's a three step process to prepare to
(35:41):
meet with me, which starts off with a risk profile,
then it does a FactFinder, and then lastly, after you
completed those two, you schedule a time and we'll be
face to face where we could do a zoom call
doesn't matter where you are in the country. We have
clients all over the place in different states. So in
our next segment, we'll tackle another common pitfall, which is
(36:06):
taking Social Security benefits too early, because many retirees tend
to leave thousands of dollars on the table by claiming
benefits at the wrong time. So I want you to
stay tuned to learn how to make the right decisions
and maximize your lifetime income. Now, if you've just joined us,
(36:29):
we've already covered some very big topics and now we're
diving into the fourth pitfall that could derail your retirement,
which is Social Security. And a crucial part of your
retirement planning is social Security. So I want to make
sure that you choose the proper timing of electing to
(36:50):
receive your Social Security benefit. Now, social Security is often
misunderstood and it's underestimated. It's not just a government check.
It's a key component of your retirement income strategy. So
making the wrong decision about when and how to claim
your benefits can leave tens of thousands of dollars on
(37:13):
the table. So here's the thing. Social Security was never
meant to be your sole source of income. It's designed
to replace about forty percent of your pre retirement income.
Yet for many Americans it's the primary or it's the
only source of retirement funds, and this makes it all
(37:36):
the more important to get this right. So let me
share a story about a friend of mine. Bill. Bill
absolutely hated his job for years. He endured long hours,
a difficult boss, and daily frustrations, so he made his
mission to retire as soon as he turned sixty two
(37:56):
years old. Well, on his birthday, he uh, he walked
out of the office and for the last time, he
just felt like he had finally become victorious over this job.
They felt like he was finally free. But then the
(38:17):
reality set in because Bill quickly discovered that the monthly
Social Security check that he had been counting on was
much smaller than he expected. Why. Well, because claiming Social
Security benefits at aged sixty two is a twenty five
percent reduction in your monthly payment compared to waiting until
(38:40):
your full retirement age, which for Bill was sixty seven.
So he also didn't know about the earnings limit. And
in twenty twenty four, if you claim Social Security before
your full retirement age, you can only earn up to
twenty one thousand, two hundred and forty dollars per year
before penalty. He's kick in, and the penalty is for
(39:03):
every two dollars that you earn above that limit, Social
Security withholds one dollar from your benefits. So this crushed bill.
He had finally realized that if he had waited until
his full retirement age, or better yet, until his age
of seventy, his monthly benefit could have been up to
(39:25):
seventy five percent higher. But it was a tough lesson
for him, but it's one that we can all learn from.
Speaker 1 (39:33):
Now.
Speaker 2 (39:33):
The key numbers for twenty twenty four with Social Security,
let's cover those for a second. Let's look at the
numbers to understand the impact of your claiming decision. So
claiming at sixty two your benefits are reduced by twenty
five percent compared to your full retirement age. Claiming at seventy,
(39:57):
your benefits increase by eight percent par per year beyond
your full retirement age. That's for a total boost of
seventy six percent. So here's an example. If your monthly
benefit at your full retirement age age sixty seven would
be two thousand dollars a month, then at sixty two,
(40:18):
you would receive fifteen hundred dollars per month. At seventy,
you would receive two thousand, six hundred and forty dollars
per month. So that's a difference of eleven hundred and
forty dollars per month at age seventy compared to age
sixty two. So over a twenty year retirement, the extra
(40:41):
benefits could total more than one hundred and twenty five
thousand dollars. That's huge money. So longevity and social security.
One of the biggest mistakes that people make is underestimating
how long the live. So here's the reality. According to
the Social Social Security Administration, a sixty five year old
(41:02):
couple in twenty twenty four has a fifty has a
fifty percent chance that at least one spouse will live
to age eighty nine, and a third of couples will
have at least one partner that lives past the age
of ninety five. So what does that mean for you? Your
(41:24):
retirement savings needs to last at least thirty years. Social
Security is one of the few sources of guaranteed income
that adjusts for inflation, which it makes it an invaluable
tool for long term financial security. So waiting to claim
social Security can significantly increase your monthly income, which is
(41:46):
especially important if you live a long life. So it's
a bet that's worth considering, not just for yourself, but
for your spouse too. Now let's talk about spousal benefits.
What do you need to know? Well, social Security isn't
just about your individual benefits. It also provides spousal benefits,
(42:07):
which can be up to fifty percent of your spouse's
full retirement age benefit. Now, this is particularly important for
households where one partner earns significantly more than the other.
So if you're the higher earner, delaying your benefits until
age seventy can maximize the survivor benefit that your spouse
(42:30):
will receive after your passing. So this could be the
difference between financial stability and hardship for your loved one.
Now let's get to know the rules here. You have
earning limits and taxation. So if you claim Social Security
before full retirement age and you continue to work, you
(42:52):
need to be aware of the earning's limit. As I
had mentioned earlier in twenty twenty four, the limit is
twenty one thousand, two hundred forty dollars per year, So
for every two dollars that you earn that is above
that threshold. Social Security withholds one dollar from your benefits,
So once you reach full retirement age, that limit goes
(43:15):
away and you can earn as much as you want
without any penalties. But here's another wrinkle. Social Security benefits
can be taxed, so if your income exceeds a certain threshold,
up to eighty five percent of your benefits may be taxable.
So this is why working with a financial advisor is crucial.
(43:38):
We can help you navigate these complexities and maximize your
tax burden. And the emotional side of retirement is something
that's very real. It's easy to focus on the numbers,
but retirement is about more than finance. It's about your
quality of life. And often, if often, here clients say,
(44:03):
I'll just work longer, but what if health issues or
layoffs make that impossible. Well, by having a solid social
security strategy in place, you can reduce stress and uncertainty. Remember,
the decisions that you make today will shape your retirement
for decades to come. So how do you maximize your benefits?
(44:24):
Here's some actionable items for you to get the most
out of your Social Security. Number one, know your full
retirement age, because your full retirement age depends upon your
birth year, so for those of you that are born
in nineteen sixty or later, your full retirement age is
sixty seven. Number two, consider delaying benefits and if possible,
(44:48):
wait until age seventy to claim, because each year that
you delay adds eight percent to your monthly benefit. The
third piece would be coordinate with your spouse develop a
strategy that optimizes benefits for both of you, especially the
survivor's benefit. Number four. Understand your earnings limits if you
(45:09):
plan to work while receiving benefits, keep your income below
the annual limit until you reach your full retirement age.
And last, but not least, work with a financial advisor
because navigating Social Security can be complex and a professional
can help you evaluate your options and the best decision
(45:30):
for your situation. Now, if you're just joining us, we've
been talking about the five things that can derail your
retirement and the phone number to get a copy of
your free guide is five one eight two zero three
one nine eight three, or go to Prescott PW dot
com and go to our blog and you will see
it posted there as well. You're listening to your money
(45:50):
matters I'm your host, Drew Prescott, chartered retirement planning counselor
and accredited wealth management advisor at Prescott Private Wealth located
at four to fifty one, who's extreet and troying. And
in the next segment, we'll cover the fifth pre retirement mistake,
which is underestimating inflation. So the other component here is
(46:15):
we want to discuss tapping into your four to one
k too early. Now that is a costly mistake. We've
reached the final mistake in our series here, which is
a big one, which is tapping into your four oh
one k too early. So for many this can be
the costliest financial misstep in their retirement planning journey. And
(46:39):
let me just share a story about a client of mine.
We'll say his name is Bill, and he had a
leaky roof and after years of patching this thing, it
was just time that he finally did a complete replacement.
And the cost, well it was hefty, and it was
about fourteen thousand dollars. Well, Bill didn't have the cash
(47:01):
on hand, so he turned to what seemed like an
easy solution, which was his four oh one K. And
what Bill didn't realize was how much that decision would
ultimately cost him because he was under fifty nine and
a half and he faced a ten percent early withdrawal penalty. Well,
on top of that, the money was taxed as ordinary income,
(47:26):
So after factoring in federal and estate taxes, Bill's ten
thousand dollars roof ended up costing him significantly more. Now,
the moral of the story here is that your four
to oh one K is meant for retirement. It's not
meant for short term expenses. So if you're considering dipping
(47:46):
into those funds, it's time to explore other options like
a personal loan or a home equity line of credit
which might carry lower interest rates in avoid penalties, allowing
you to keep your savings for retirement in tax So
why is it so expensive to tap into your retirement
(48:09):
savings too early. Well, here's why dipping into your four
oh one K before retirement is one of the worst
mistakes that you can make. Is because one taxes and penalties.
Withdrawals before fifty nine and a half, as we just covered,
are subject to a ten percent early withdrawal penalty, plus
(48:30):
their tax is ordinary income. So this means that you
could lose up to thirty to forty percent of your
withdrawal to tax and penalty, depending upon what tax bracket
you're in. Number two, you're losing that compounding growth, So
every dollar that you take out is a dollar that
no longer has the opportunity to grow. So, thanks to
(48:53):
compounding interest, even small withdrawals can have a massive impact
on your retirement balance over time. Time. Number three is
setting a bad precedent for yourself. Once you've dipped into
your retirement account, it's tempting to do it again. Years ago,
I used to always explain if you had two opportunities
(49:17):
to put money away, the first one made I share
this with younger people, and I say, the first bucket
makes no money, but you cannot access it no matter what.
The second one makes a rate of return, but you
(49:38):
have the ability to tap into it in thirty years
from now. Which one has more money, and in most situations,
it's the one that you cannot access. So this can
lead to a vicious cycle of withdrawals when you start
to tap into your four to one K early, and
it leaves your retirement savings dangerously depleted. So instead of
(49:58):
focusing on what you you can't do with your retirement savings,
let's talk about what you can do to maximize them.
In twenty twenty four, the IRS increase the annual contribution
limit for retirement accounts. Your four to one K can
now contribute up to twenty three thousand dollars with an
(50:19):
additional seventy five hundred dollars catchup contribution if you're fifty
years old or older. Now that's a total of thirty thousand,
five hundred per year for older workers and with iras,
the contribution is seven thousand, with a one thousand dollars
catchup contribution for fifty year older, giving you eight thousand
dollars limit. So if you're not maxing out these limits,
(50:44):
you're leaving money and growth on the table. And employer
matches in particular are essentially free money that should that
you should really take full advantage of. So here are
some steps to avoid this mistake. To break down some
practical steps to avoid the trap of tapping into your
(51:04):
retirement savings early. Number one, plan early, start saving as
early as possible, because the power of compound and growth
can't be overstated. Number two, build an emergency fund. One
of the best ways to avoid dipping into four to
one ks is to have an emergency fund. Aim to
(51:25):
save at least three to six months worth of living
expenses in a high yield savings account.
Speaker 1 (51:31):
Now.
Speaker 2 (51:31):
This will give you a financial cushion for any unexpected
expenses and prevent you from making a bad decision like
tapping into your four to one K. Number three, maximize
your contributions. If you're fifty years old or older, use
that ketchup contribution to supercharger savings, and every extra dollar
that you invest today will pay dividends in retirement. Number four.
(51:56):
Treat retirement accounts as though they are sacred. View your
four to one K and your IRA is untouchable until
retirement because they're your safety net for when you no
longer have a regular paycheck. The fifth piece is consult
a financial advisor. If you're facing financial challenges, a financial
advisor can help you explore alternatives to withdraw Alternatives to
(52:21):
withdrawing from your retirement accounts. Sometimes refinancing debt or creating
a stricter budget can solve the problem without jeopardizing your future.
So why protecting your four to one K matters? It matters,
So you want to think of your retirement savings as
a golden goose. The egg it lays is the future income.
(52:47):
So if you raid the nest and harm the goose,
you're going to have fewer eggs in those years to come.
So retirement planning is really it's a journey, and it
requires great patience, discipline, and a commitment to making smart
decisions all the way. So let's recap these five mistakes
(53:08):
that we've discovered. The first is not having a plan.
Without a roadmap, you're flying blind, and a written retirement
plan is the first step toward financial security. The second
is saving in the wrong places. Now a diversified portfolio
helps your money grow while managing risk. Number three underestimating expenses.
(53:32):
These expenses are healthcare costs, inflation, and lifestyle choices that
can drain your savings faster than you think. The fourth
piece we covered is claiming Social Security too early, so
waiting until your full retirement age or longer can significantly
boost your benefits. The fifth and final piece is tapping
(53:54):
into your four to one K two early, so taxes, penalties,
and lost growth really make this a costly mistake. You've
worked hard to build a career, to support your family
and to save for the future. Well now it's time
to take care of you. So make a plan, stick
to it, and set yourself up for your retirement that
(54:17):
you deserve. So if today's discussion has resonated with you,
don't wait to take the next step. Call me at
five point eight two zero three one nine eight three
or visit PRESCOTTPW dot com and set your appointment, go
to new clients and follow the three step process. So
(54:38):
as you think about your retirement your retirement, remember this,
it's not just about the numbers. It's about your freedom.
Freedom to spend your days as you choose, pursue your passions,
and enjoy the fruits of your labor. Thank you for
joining me today on your money matters with Drew Prescott,
Chartered Retirement Planning counselor an accredited Wealth Management advisor at
(55:02):
Prescott Private Wealth in Troy, New York. So until next time,
take care of your finances, plan smart, and enjoy the
journey to a fulfilling retirement. God bless you all and
thank you so much for taking the time out on
this beautiful Sunday, and hope that you have a wonderful weekend.
Welcome to the hidden world of wealth, where secrets of
the affluent become accessible to you. You are listening to
Your Money Matters, the most provocative financial radio show on
the airwaves. You are about to start your educational journey
here on Your Money Matters with your host, Drew Prescott,
(00:22):
President of Prescott Private Wealth and Chartered Retirement Planning Counselor.
Drew will unlock the complexities of the financial landscape with straightforward,
powerful insights. Whether you're planning for retirement, managing in a state,
or looking to grow your wealth. Consider this your exclusive invitation.
Turn up the volume, lean in closer. Let's navigate the
(00:45):
hidden paths of prosperity together. Your financial enlightenment begins now.
Securities all produce a terror Financial Specialists LLC Member fen
the SIPC reservices offered through Setara Investment Advisors LLC SOTERA
firms are under separate ownership from any other named entity.
(01:06):
Four five to one. Who's Sixth Street, Troy, New York
one two one eight zero.
Speaker 2 (01:34):
Welcome back, everybody. You are listening to Your Money Matters
and I'm your host, Drew Prescott, Chartered Retirement Planning Counselor
credited wealth management advisor and president here at Prescott Private Wealth,
located at four to fifty one. Who's extreet in Troy,
New York, And thank you for tuning in today. Very
excited to have you here and appreciate your support every weekend.
(01:57):
And I'm excited to have you join me today as
we discuss some strategies that you should consider before you retire,
because retirement is a journey that requires careful planning and
avoidance of common pitfalls. And today we'll cover the five
biggest mistakes that could derail your retirement. You know, retirement
(02:18):
is something everybody dreams about. It's some think about it
how soon they can retire, and while others really focus
on making sure that they have enough money saved. So,
whether you're just starting your career, you're midway through, or
maybe you're nearing retirement, it's crucial to avoid simple yet
(02:39):
costly mistakes. And today I'll break down these mistakes and
give you actionable steps to secure your financial future. So
have you heard the staggering statistics? According to a twenty
twenty four study by Employee Benefit Research Institute, nearly forty
percent of Americans aged thirty five to sixty four have
(03:03):
saved less than fifty thousand dollars for retirement. Now that's
an alarming number. So, considering how long retirement can last
and how expensive life can be, even if you've been
diligently saving, you might still be making costly mistakes near strategy.
(03:23):
So let's put it in perspective here. We're living longer
and often we're well into our eighties and beyond, and
medical advancements and healthier lifestyles they've extended life expectancy now.
But this also means that you'll need to make your
money last much longer, and that's not easy when life
(03:44):
is full of unpredictable events like illnesses, disability, divorce, and
even natural disasters as we've seen recently. But all of
these can derail even the best laid savings plan. So
today I'll share tips on safeguarding your financial future and
will answer crucial questions like is my portfolio well balanced?
(04:08):
Am I maximizing my contributions? And at what age should
I claim Social Security? We'll also address how to build
a retirement plan that's not just about numbers, but about
your dreams and your goals. And mistake number one is
not having a retirement plan. So let me introduce you
(04:30):
to Jim and Linda. Jim was a sixty two year
old factory worker who had been contributing to his four
oh one K for decades, and his wife, Linda. She
managed the household finances and assumed that their savings were enough.
They'd planned to retire. They wanted to travel, but they
didn't really have a written plan, and when Jim had
(04:51):
a health scare at sixty three and had to retire early,
that's when they realized that they hadn't saved enough money
to cover their expenses, let alone travel the world as
they had planned. Now, unfortunately, many Americans make this same mistake.
They assume that social Security will cover their needs, and
that's not the case in most scenarios. So let me
(05:13):
ask you, do you think that eighteen hundred and eighty
two dollars per month, which is the average social Security
benefit for twenty twenty four, do you think that that's
enough to live on? For most people?
Speaker 1 (05:25):
It is not.
Speaker 2 (05:26):
And social Security is a great supplement, but it is
not a comprehensive plan. So to avoid this mistake, start
out by writing down your retirement goals, like where do
you see yourself in retirement. Are you gardening, are you
guys traveling or maybe starting a new hobby or a business.
(05:48):
Will Studies show that people with written retirement plans have
five times more money saved than those who don't. So
writing down your goals forces you to think about the
costs that are associated with retirement, and it allows you
to create a roadmap. So take control of your savings.
(06:10):
At age fifty nine and a half. You can begin
withdrawing from your four toh one K or your IRA
without an early distribution penalty. But just because you can
do that does not mean that you should. Your retirement
savings are like your primary income source, and early withdrawals
(06:31):
could leave you financially short in your latter years. So
workers that are aged fifty and older can make what
we call catch up contributions to both iras and four
to one ks. So for twenty twenty four, the limits
are seventy five hundred dollars for iras and thirty thoy
(06:53):
five hundred for four to one ks. Now, these increased
limits are a golden opportunity for late savers to close
the gap on their retirement goals, so take advantage of
them if you have not already. Now, Mistake number two
is not knowing where your money goes. Now, budgeting may
sound simple, but it's critical. And if you don't know
(07:14):
how much you're spending, how can you actually ensure that
your savings will last. Now, this mistake often sneaks up
on people because expenses in retirement they can change dramatically.
For instance, healthcare costs tend to rise. We know that
you may travel more frequently in your early retirement years,
and new hobbies and leisure activities can also increase spending.
(07:37):
So let's talk about numbers for a second here. According
to a twenty twenty four study by Fidelity Investments, the
average sixty five year old couple will need three hundred
and fifteen thousand dollars simply to cover healthcare costs throughout
their retirement. Now that's just healthcare, So if you add
(07:59):
in living expenses, travel, and inflation, you can see how
easy it is to outspend your savings. So here's a
pro tip for you. Create a detailed budget for your
retirement and be realistic about your needs and your wants,
and also account for inflation. Well, if you're working with
(08:21):
a financial advisor, they can help you do this analysis,
and they can analyze your spending patterns and make adjustments
to ensure that your money lasts. Now, this takes us
to mistake number three, making sure that your money lasts,
because underestimating longevity is a major threat to your financial
(08:42):
picture and retirement. And here's a question for you, how
long do you expect to live? Now, if you're in
good health, there's a high probability that you'll live into
your late eighties or even nineties. Now, this longevity is
absolutely a blessing, but it also means that your retirement
saving must last longer than ever before. So consider this.
(09:06):
A balanced portfolio with a mix of stocks and bonds
historically provides better long term growth than keeping your money
in cash or low yield investments. Now, it's important to
review your portfolio regularly and adjust it, and you're going
to want to adjust it based on your risk tolerance
(09:28):
through time. In addition, we want to look at your
time horizon and your financial goals. Now, the financial goals
is key because that leads us into mistake number four,
which is failing to plan for unexpected events. Because life
is unpredictable. As we all know, you might face a
(09:49):
serious illness, need long term care, or deal with a
natural disaster. Now, how prepared are you for these possibilities
above and beyond your find financial goals? Well, insurance is
a pivotal part of your retirement plan. Long term care insurance,
for example, can help cover the cost of nursing homes,
(10:10):
in home care, or assisted living facilities. Now, without it,
these expenses can really drain your savings. And similarly, disability
insurance can protect your income if you're still working and
unable to perform your job duty to illness or injury.
Now let's turn to mistake number five here, and what
(10:34):
we'll do is, as the show keeps going on, I'll
unpack each one for you later on as well. Okay,
so I'll give you some opportunity to take some notes
and some actionable steps that'll be helpful for you. Now,
mistake number five is ignoring estate planning. So let's just
talk about something that most people avoid, which is a
state planning. So without a valid will, your assets may
(10:58):
be subject to state probate laws, which can be time
consuming and expensive for your loved ones. So state planning
isn't just about wills, It's also about designating your beneficiaries
on your accounts and creating a power of attorney for
medical and financial decisions. And this ensures that your wishes
are honored or even if you become incapacitated, So your
(11:23):
retirement starts here. Planning for retirement doesn't have to be overwhelming.
So whether you're thirty five or sixty five, the best
time to start is now. So to help you avoid
these common mistakes, I've created a free guide that's titled
the five Things that Can Derail your retirement. If you
(11:45):
want it quick, feel free to send me an email
Drew at PRESCOTTPW dot com leave me a voicemail at
five one eight two zero three one nine eighty three.
But if you want to take a moment and go
over to our website at PRESCOTTPW dot com, you will
see it right inside of our blog and you can
help yourself there. So how do we avoid mistake number two? Well,
(12:12):
in our next piece here, we're going to dive into
the importance of knowing where your money goes. Budgeting and
understanding your expenses are critical, as we've said, so don't
go any place. I'll be starting here with more insight
on securing your retirement that you've always dreamed of. So
(12:33):
if you're just joining us here today, you're listening to
your money matters. I'm Drew Prescott, President Wealth Advisor at
Prescott Private Wealth, and I hope you can find a
value in our discussion up to this point about the
five things that could derail your retirement, because these pitfalls
are more common than you think, but with the right strategies,
they're also completely avoidable. So if you'd like a copy
(12:55):
of this guide the five things that can derail your retirement,
simply call us A five one eight two zero three
one nine eighty three or PRESCOTTPW dot com and you'll
find it right in our blog section here. Now, the
second biggest pre retirement mistake is putting your savings in
the wrong place. So let's dive into mistake number two,
(13:18):
placing your hard earned savings in the wrong place. Retirement
planning is not just about saving money, it's about growing
that money and in the right way. So let me
share a story about Sarah. Sarah had inherited seventy five
thousand dollars from her mother, and like many people, she
wanted to keep that money safe, so she put it
(13:39):
in her bank, getting a standard savings account, and it
sat there for years untouched. So now here's a question.
Do you know what the average interest rate on a
bank account is in twenty twenty four? This number is
gonna blow you away. Uh, but it's only aboutero point
four percent. So that means that her seventy five thousand
(14:00):
dollars grew by less than three hundred dollars per year,
barely keeping up with inflation. So imagine instead, if Sarah
had taken that money out and invested it in a
money market fund or a roth ira or even a
high yield savings account. Over the years, that difference could
(14:21):
have been tens of thousands of dollars. Now, if she
had invested it, it could have grown to be something
very significant. Now, this is a mistake that I see
far too often is that people are so concerned about
keeping their money safe that they don't let it grow.
And what they do not realize is that being overly
(14:42):
cautious can actually cost them. So traditionally, when you're dealing
with a financial advisor, they recommend that as you approach retirement,
your portfolio should become more conservative to minimize risk. So
while this advice might make sense on the surface, today's
(15:05):
economy is telling us a different story because we're living
longer than ever before, and according to the Social Security Administration,
the average retirement lasts about twenty years, and nearly half
of women who are sixty five today will live on
to see the age of ninety. And that's a long
time to make your money last. So here's where being
(15:27):
overly conservative can be just as dangerous as taking on
too much risk. So let's say that you move all
of your money into bonds or certificates of deposits CDs
to play it safe. So while these options are less
volatile than stocks, they also provide lower returns, and if
(15:47):
inflation rises, which is currently hovering around three to four
percent annually in the US, your purchasing power could shrink
significantly over time. Now, to put it in another way,
your retirement savings must not only last longer, but they
also need to work harder. So what is the role
(16:11):
of stocks in a retirement portfolio. Well, stocks often get
a bad reputation for being too risky, especially for retirees,
but here's the reality. Over the long term, stocks have
consistently provided higher average returns than bonds or cash. Yes,
(16:31):
they are more volidile in the short term, but when
held in a diversified portfolio, they can help you outpace
inflation and grow your wealth. So think about it this way.
If you're sixty five today, you could easily live another
twenty five to thirty years. Now, that's long enough for
your portfolio to weather the ups and downs of the
(16:53):
market and still come out ahead. So why does diversification matter. Well,
here's another common mistake. People think that they're diversified because
they own several mutual funds. But often these mutual funds
hold the same stocks, which means that you're not truly
spreading your risk. True diversification means spreading your investments across
(17:17):
small cap and large cap stocks, international funds, bonds, real
estate investment trusts, and alternative investments such as commodities or
private equities. Now, the goal here is really to create
a portfolio that isn't overly dependent upon the success of
any one sector or market. For example, if the US
(17:40):
market takes a hit, your international investments or bonds could
help cushion that blow. And I like to say that
diversification is like an umbrella, sunglasses, and a raincoat all
in your bag, if you're prepared for whatever the weather
or the market throws at you. If you're prepared that way. Now,
(18:03):
the importance of setting realistic expectations is very important because
another challenge that retirees face is overestimating returns. So if
you're expecting an eight to a ten percent annual growth
but your portfolio is delivering four to six percent, you
could run out of money much faster than you had planned.
And this is where working with a financial advisor becomes
(18:25):
critical because advisors can help you set a realistic expectation
based on your risk tolerance, time horizon, and retirement goals,
and they can help you adjust your plan as needed,
ensuring you to stay on track. Now, what we need
to do again, as we said earlier, is to stay
(18:46):
on track is budgeting, so knowing where your money goes.
So let's shift gears for a moment and talk about that.
Do you know how much you spend each month? Now
many people may think so, but we see that a
lot of people underestimate their expenses, especially in retirement, and
it's a myth that retirement automatically means spending less. In fact,
(19:11):
I always tell people as we're planning for retirement, you're
probably going to spend the same amount and potentially more
in the early years of retirement because you've got these
pent up goals and travel plans and everything else that
you want to do. Now, as you get a little
bit older, your propensity to consume kind of goes away.
(19:36):
So I always tell people, and no offense out there
to anybody, but I say, you know, in the beginning
of your retirement, if you retire early, well you got
a lot of life ahead of you, and you're going
to probably pick up new hobbies and stay quite busy.
If you're someone that retires at sixty five or seventy,
I always say, you know, from sixty five you've got
(19:58):
a solid price no. Ten, possibly fifteen years of really
staying active, golfing and traveling and doing all these things, gardening,
all these things that you really love. Now, when you
get to eighty, I don't care who you are, you
slow down a step by the time that you are.
(20:18):
If you're still healthy and you're at eighty five years old,
you still are not as busy as you ever were.
And then when you get a little bit older, maybe
you just need a warm blanket and some hard tack. Candy,
but you don't need nearly as much money any longer.
So when you spend more time in your early retirement years,
(20:43):
as you travel, and like I said, as you pick
up new hobbies or you complete home improvement projects, you're
gonna need a little extra juiceter in those times. So
let's not forget what we covered earlier, which is a
healthcare cost. Remember how I refer to that twenty twenty
four study by Fidelity with which found that the average
sixty five year old couple will need three hundred and
(21:03):
fifteen thousand dollars to cover health care expenses in retirement.
And that's a significant expense that many people fail to
account for. So again, here's a pro tip for you.
Create a detailed retirement budget that includes not just your
daily living expenses but also your healthcare, travel, and inflation.
(21:25):
And revisit this budget annually because this does change and
you're going to have to make adjustments as your needs change.
So here's a question that I want to have you
reflect on for a second. You personally, have you kept
a realistic budget and have you overestimated your returns? So
(21:47):
that's that's a dangerous place to be because retirement is
not the time to guess. It's the time to plan strategically,
and financial advisors can help you with that by creating
a comprehensive budget, diversifying your portfolio, maximizing your retirement contributions
help you plan for unexpected expenses, and they can also
(22:11):
help you navigate complex decisions such as when to claim
social Security or how to maximize taxes on your withdrawals. Now,
I always get a good laugh out of people that
say clients even that say yeah, I think I've decided
I'm going to take social Security at this time and
blah blah blah. Anytime I've ever heard a client say
(22:34):
that and tell me their philosophy behind why, the reasoning
seems a little flawed. So I take them through a
maximizer with social security just to educate. Now, I would
say probably eight times out of ten they kind of
(22:57):
change their strategy after learning the facts about social security. Now,
good for them, Good for you for reviewing what you
think your social security strategy should be. But you really
need to work with a professional to make sure that
you have the actual number and you have a plan
in place, because you can't choose your proper social security
(23:21):
date without having a financial plan that's written by a professional.
So if you're unaware about your current retirement plan or
you want to avoid these common mistakes, I'd love to
help you. Here at Prescott Private Wealth, we specialize in
guiding individuals and families through every stage of retirement planning.
(23:41):
And if you're listening today and you'd like to receive
a free guide to the five things that can derail
your retirement, call us at five one eight two zero
three one nine eight three, email me at Drew at
PRESCOTTPW dot com, or go to PRESCOTTPW dot com under
blog and you'll be able to see this that I
prepared for you. Now, the next mistake that I want
(24:06):
to cover here is underestimating longevity. And in order to
tackle this common pitfall of underestimating how long you live
and how much money you'll need, it is crucial to
plan for the long haul. So stay tuned because we're
(24:26):
going to cover that here. And I want to make
sure that again you're getting some actionable steps that can
be productive for you and your family in retirement years.
And again, if you're interested in receiving a copy of
these steps, feel free to call us. You're listening to
your money matters. I'm your host, Drew Prescott, chartered retirement
(24:48):
planning counselor and accredited wealth management advisor at Prescott Private Wealth,
located at four fifty one, who's extreet in Troy, New York.
Feel free to keep an eye on our blog. I
keep that updated weekly Prescott dot com. So when you're working,
your weekends are primarily spent at the office. Right, did
(25:10):
I say weekends? I think I said weekends. I didn't
mean too I wanted to say weekdays. So when you're working,
your weekdays are primarily spent at the office. Now, your
free time while you're working is limited to just evenings
and weekends, right, And that's when most discretionary spending occurs.
When you're dining out, you're shopping, you've got recreational activities,
(25:31):
or maybe you've got weekend getaways. Well, now imagine that
every day in retirement is like a Saturday. Without a
plan or a budget, it's going to be easy for
spending to start to spiral out of control. So what
starts as an occasional treat, now it starts to turn
(25:53):
into a lifestyle that drains your retirement savings faster. Than
you had expected. So here's the hard truth. The Federal
Reserve reports that the median retirement savings for Americans is
just sixty thousand dollars, So for people that are aged
fifty five to sixty four, it's only one hundred and
(26:15):
three thousand. So let's be honest, how far will that
really get you when you consider the average retirement last
twenty to thirty years. This is why it's important to
start saving as early as possible. So when is the
best time to start saving for retirement? The answer simple,
(26:37):
It was yesterday, but then second best is today. So
in twenty twenty four, the IRS increased the annual contribution
limits for four toh one ks to twenty three thousand dollars,
with an additional seventy five hundred dollars catch up contribution
(26:57):
for those of you who are over the age of fifty,
bringing it to thirty thousand, five hundred. Now, iras now
allow contributions up to seven thousand dollars with a one
thousand dollars catchup for older savers. So if you're starting late,
(27:18):
the stakes are high. According to Vanguard founder Jack Boggle,
individuals who begin saving in their forties should aim to
contribute twenty five percent of their income to catch up.
So while this may sound daunting, it really underscores the
importance of starting early. Now. Waiting too long is one
of the biggest regrets that retirees express. The earlier that
(27:43):
you begin saving, the more time your money has to
grow through the power of compound interest. So another component
that you're going to want to pay attention to here
is healthcare, and that's the elephant in the room now.
One of the most underestimated retirement expenses is healthcare. So
(28:06):
even if you're healthy now, it's almost inevitable that you'll
face rising medical costs as you age. The rising cost
of healthcare is awfully steep now. According to Fidelities twenty
twenty four estimate, the average couple retiring at sixty five
will need approximately three hundred and fifteen thousand dollars to
(28:29):
cover their healthcare expenses during retirement. Now, this includes your
Medicare premiums, deductibles, out of pocket expenses for prescriptions, hospital visits,
and other things. Now, it's also important to note that
Medicare does not cover everything, and the key exclusions for
Medicare that are excluded are dental envision care, hearing aids,
(28:56):
and most long term care needs. So failing to account
for these gaps can lead to significant financial strain. So
supplemental insurance such as metagap or Medicare advantage plans, they
can help fill some of these gaps, but they come
with additional costs. Now, if we look at the long
(29:18):
term care side of things, more than seventy percent of
retirees will require some form of long term care. Now
this might include in home care, it could be assisted
living or a nursing home. Now, the costs here are
absolutely staggering. The median annual cost for assisted living in
(29:39):
twenty twenty four is now fifty four thousand dollars, and
a private room in a nursing home averages one hundred
and nine thousand per year. Now, every market's different, so
this is just an average number. Now, the trend is
clear that these costs are only increasing. Long term care
(30:00):
insurance is a way to prepare, but the earlier that
you purchase it, the more affordable it will be. And
Melanie Hagen, who's a senior care expert, she put it bluntly.
She said, buy long term care insurance or make a
plan for who will care for you if you face
(30:20):
a serious medical condition that prevents independent living. Now, this
kind of planning is more than financial. It's about preserving
your peace of mind and protecting your loved ones from
bearing the burden. Now, I don't have this study in
front of me, but there was a study that was
done years ago, and there's been plenty of specials out
(30:43):
there as well that talk about when one spouse requires care,
the spouse that is providing the care tends to age
quicker and their health declinents faster than the individual that
initially required care. So the emotional strain, the physical strain,
(31:07):
all of that comes into play, which also ties into
a strain on their health. So that is why it's
very important to have a plan put together as just
simply a way of reducing the burden for your loved ones. Now,
let's talk about the importance of diversification, because we can't
talk about retirement savings without discussing diversification. Now, some retirees
(31:32):
shy away from the stock market entirely, believing that it's
just too risky, but avoiding the market all together can
be just as dangerous, if not even more so. Now,
conventional wisdom says that the stock market is risky, but
avoiding it all together can be even riskier if your
money cannot keep pace with inflation, and that is something
(31:55):
that you need to keep in the forefront of your mind. Now,
you want to balance risk and reward because the stock
market may experience some short term volatility, but it has
historically delivered higher returns over a long term compared to
bonds or cash. And a diversified portfolio one that includes stocks, bonds,
real estate, and alternative investments it helps you balance risk
(32:20):
while still capturing growth. So here's an example. If you
place all of your money in bonds or CDs, you
might avoid market downturns, but you'll also likely lose purchasing
power over time due to inflation. So a mix of
asset classes ensures that you're prepared for different market conditions
(32:41):
while maximizing potential returns. Now, let me give you a
couple of actionable steps for planning for retirement expenses. The
first would be create a realistic budget. Now, a budget
is your first line of defense against overspending, and I
would courage you to account for both fixed costs like
(33:02):
housing and variable costs like travel and dining. Out, but
don't forget to include healthcare, inflation and other potential surprises.
The second area that I would like to point out
is to increase your savings. Now. Maximize contributions to retirement
accounts like your four toh one ks and iras, and
(33:25):
if you're over fifty, take advantage of these catch up
contributions to help accelerate your savings. The third thing that
I would say to take a note for is plan
for healthcare costs as we've been talking about, and investigate
supplemental insurance options to cover gaps in your medicare, and
(33:45):
if long term care insurance is right for you, purchase
it sooner rather than later. The fourth component here is
diversify your investments. Work with a qualified financial advisor to
ensure that your portfolio is diversified across multiple asset classes,
because this reduces the risk while keeping your money working
(34:10):
for you. Now, the fifth piece here would be update
your plan regularly. Now, retirement planning is not just a
set it and forget it, so you want to review
your plan annually to account for changes in your expenses,
health and market conditions. So why partner with a financial advisor?
(34:31):
Because a financial advisor navigates the complexity of your retirement expenses,
and that can feel overwhelming when you go at it
by yourself. So that's where a trusted financial advisor really
comes in. Advisors can help you create and manage a
comprehensive budget, strategically allocate your investments, account for rising healthcare
(34:56):
and long term care costs, and also help you stay
discipline and focused on your long term goals because retirement
it's one of the most significant financial transitions that you
will ever make, and with the proper guidance, you can
avoid some of these pitfalls and create a secure financial retirement.
(35:18):
So if today's discussion is really resonating with you, don't
wait to take action. Call five one eight two zero
three one nine eight three or go to Prescott PW
dot com. You can schedule a time with me right
on the website, go into New Clients and UH you'll
see that there's a three step process to prepare to
(35:41):
meet with me, which starts off with a risk profile,
then it does a FactFinder, and then lastly, after you
completed those two, you schedule a time and we'll be
face to face where we could do a zoom call
doesn't matter where you are in the country. We have
clients all over the place in different states. So in
our next segment, we'll tackle another common pitfall, which is
(36:06):
taking Social Security benefits too early, because many retirees tend
to leave thousands of dollars on the table by claiming
benefits at the wrong time. So I want you to
stay tuned to learn how to make the right decisions
and maximize your lifetime income. Now, if you've just joined us,
(36:29):
we've already covered some very big topics and now we're
diving into the fourth pitfall that could derail your retirement,
which is Social Security. And a crucial part of your
retirement planning is social Security. So I want to make
sure that you choose the proper timing of electing to
(36:50):
receive your Social Security benefit. Now, social Security is often
misunderstood and it's underestimated. It's not just a government check.
It's a key component of your retirement income strategy. So
making the wrong decision about when and how to claim
your benefits can leave tens of thousands of dollars on
(37:13):
the table. So here's the thing. Social Security was never
meant to be your sole source of income. It's designed
to replace about forty percent of your pre retirement income.
Yet for many Americans it's the primary or it's the
only source of retirement funds, and this makes it all
(37:36):
the more important to get this right. So let me
share a story about a friend of mine. Bill. Bill
absolutely hated his job for years. He endured long hours,
a difficult boss, and daily frustrations, so he made his
mission to retire as soon as he turned sixty two
(37:56):
years old. Well, on his birthday, he uh, he walked
out of the office and for the last time, he
just felt like he had finally become victorious over this job.
They felt like he was finally free. But then the
(38:17):
reality set in because Bill quickly discovered that the monthly
Social Security check that he had been counting on was
much smaller than he expected. Why. Well, because claiming Social
Security benefits at aged sixty two is a twenty five
percent reduction in your monthly payment compared to waiting until
(38:40):
your full retirement age, which for Bill was sixty seven.
So he also didn't know about the earnings limit. And
in twenty twenty four, if you claim Social Security before
your full retirement age, you can only earn up to
twenty one thousand, two hundred and forty dollars per year
before penalty. He's kick in, and the penalty is for
(39:03):
every two dollars that you earn above that limit, Social
Security withholds one dollar from your benefits. So this crushed bill.
He had finally realized that if he had waited until
his full retirement age, or better yet, until his age
of seventy, his monthly benefit could have been up to
(39:25):
seventy five percent higher. But it was a tough lesson
for him, but it's one that we can all learn from.
Speaker 1 (39:33):
Now.
Speaker 2 (39:33):
The key numbers for twenty twenty four with Social Security,
let's cover those for a second. Let's look at the
numbers to understand the impact of your claiming decision. So
claiming at sixty two your benefits are reduced by twenty
five percent compared to your full retirement age. Claiming at seventy,
(39:57):
your benefits increase by eight percent par per year beyond
your full retirement age. That's for a total boost of
seventy six percent. So here's an example. If your monthly
benefit at your full retirement age age sixty seven would
be two thousand dollars a month, then at sixty two,
(40:18):
you would receive fifteen hundred dollars per month. At seventy,
you would receive two thousand, six hundred and forty dollars
per month. So that's a difference of eleven hundred and
forty dollars per month at age seventy compared to age
sixty two. So over a twenty year retirement, the extra
(40:41):
benefits could total more than one hundred and twenty five
thousand dollars. That's huge money. So longevity and social security.
One of the biggest mistakes that people make is underestimating
how long the live. So here's the reality. According to
the Social Social Security Administration, a sixty five year old
(41:02):
couple in twenty twenty four has a fifty has a
fifty percent chance that at least one spouse will live
to age eighty nine, and a third of couples will
have at least one partner that lives past the age
of ninety five. So what does that mean for you? Your
(41:24):
retirement savings needs to last at least thirty years. Social
Security is one of the few sources of guaranteed income
that adjusts for inflation, which it makes it an invaluable
tool for long term financial security. So waiting to claim
social Security can significantly increase your monthly income, which is
(41:46):
especially important if you live a long life. So it's
a bet that's worth considering, not just for yourself, but
for your spouse too. Now let's talk about spousal benefits.
What do you need to know? Well, social Security isn't
just about your individual benefits. It also provides spousal benefits,
(42:07):
which can be up to fifty percent of your spouse's
full retirement age benefit. Now, this is particularly important for
households where one partner earns significantly more than the other.
So if you're the higher earner, delaying your benefits until
age seventy can maximize the survivor benefit that your spouse
(42:30):
will receive after your passing. So this could be the
difference between financial stability and hardship for your loved one.
Now let's get to know the rules here. You have
earning limits and taxation. So if you claim Social Security
before full retirement age and you continue to work, you
(42:52):
need to be aware of the earning's limit. As I
had mentioned earlier in twenty twenty four, the limit is
twenty one thousand, two hundred forty dollars per year, So
for every two dollars that you earn that is above
that threshold. Social Security withholds one dollar from your benefits,
So once you reach full retirement age, that limit goes
(43:15):
away and you can earn as much as you want
without any penalties. But here's another wrinkle. Social Security benefits
can be taxed, so if your income exceeds a certain threshold,
up to eighty five percent of your benefits may be taxable.
So this is why working with a financial advisor is crucial.
(43:38):
We can help you navigate these complexities and maximize your
tax burden. And the emotional side of retirement is something
that's very real. It's easy to focus on the numbers,
but retirement is about more than finance. It's about your
quality of life. And often, if often, here clients say,
(44:03):
I'll just work longer, but what if health issues or
layoffs make that impossible. Well, by having a solid social
security strategy in place, you can reduce stress and uncertainty. Remember,
the decisions that you make today will shape your retirement
for decades to come. So how do you maximize your benefits?
(44:24):
Here's some actionable items for you to get the most
out of your Social Security. Number one, know your full
retirement age, because your full retirement age depends upon your
birth year, so for those of you that are born
in nineteen sixty or later, your full retirement age is
sixty seven. Number two, consider delaying benefits and if possible,
(44:48):
wait until age seventy to claim, because each year that
you delay adds eight percent to your monthly benefit. The
third piece would be coordinate with your spouse develop a
strategy that optimizes benefits for both of you, especially the
survivor's benefit. Number four. Understand your earnings limits if you
(45:09):
plan to work while receiving benefits, keep your income below
the annual limit until you reach your full retirement age.
And last, but not least, work with a financial advisor
because navigating Social Security can be complex and a professional
can help you evaluate your options and the best decision
(45:30):
for your situation. Now, if you're just joining us, we've
been talking about the five things that can derail your
retirement and the phone number to get a copy of
your free guide is five one eight two zero three
one nine eight three, or go to Prescott PW dot
com and go to our blog and you will see
it posted there as well. You're listening to your money
(45:50):
matters I'm your host, Drew Prescott, chartered retirement planning counselor
and accredited wealth management advisor at Prescott Private Wealth located
at four to fifty one, who's extreet and troying. And
in the next segment, we'll cover the fifth pre retirement mistake,
which is underestimating inflation. So the other component here is
(46:15):
we want to discuss tapping into your four to one
k too early. Now that is a costly mistake. We've
reached the final mistake in our series here, which is
a big one, which is tapping into your four oh
one k too early. So for many this can be
the costliest financial misstep in their retirement planning journey. And
(46:39):
let me just share a story about a client of mine.
We'll say his name is Bill, and he had a
leaky roof and after years of patching this thing, it
was just time that he finally did a complete replacement.
And the cost, well it was hefty, and it was
about fourteen thousand dollars. Well, Bill didn't have the cash
(47:01):
on hand, so he turned to what seemed like an
easy solution, which was his four oh one K. And
what Bill didn't realize was how much that decision would
ultimately cost him because he was under fifty nine and
a half and he faced a ten percent early withdrawal penalty. Well,
on top of that, the money was taxed as ordinary income,
(47:26):
So after factoring in federal and estate taxes, Bill's ten
thousand dollars roof ended up costing him significantly more. Now,
the moral of the story here is that your four
to oh one K is meant for retirement. It's not
meant for short term expenses. So if you're considering dipping
(47:46):
into those funds, it's time to explore other options like
a personal loan or a home equity line of credit
which might carry lower interest rates in avoid penalties, allowing
you to keep your savings for retirement in tax So
why is it so expensive to tap into your retirement
(48:09):
savings too early. Well, here's why dipping into your four
oh one K before retirement is one of the worst
mistakes that you can make. Is because one taxes and penalties.
Withdrawals before fifty nine and a half, as we just covered,
are subject to a ten percent early withdrawal penalty, plus
(48:30):
their tax is ordinary income. So this means that you
could lose up to thirty to forty percent of your
withdrawal to tax and penalty, depending upon what tax bracket
you're in. Number two, you're losing that compounding growth, So
every dollar that you take out is a dollar that
no longer has the opportunity to grow. So, thanks to
(48:53):
compounding interest, even small withdrawals can have a massive impact
on your retirement balance over time. Time. Number three is
setting a bad precedent for yourself. Once you've dipped into
your retirement account, it's tempting to do it again. Years ago,
I used to always explain if you had two opportunities
(49:17):
to put money away, the first one made I share
this with younger people, and I say, the first bucket
makes no money, but you cannot access it no matter what.
The second one makes a rate of return, but you
(49:38):
have the ability to tap into it in thirty years
from now. Which one has more money, and in most situations,
it's the one that you cannot access. So this can
lead to a vicious cycle of withdrawals when you start
to tap into your four to one K early, and
it leaves your retirement savings dangerously depleted. So instead of
(49:58):
focusing on what you you can't do with your retirement savings,
let's talk about what you can do to maximize them.
In twenty twenty four, the IRS increase the annual contribution
limit for retirement accounts. Your four to one K can
now contribute up to twenty three thousand dollars with an
(50:19):
additional seventy five hundred dollars catchup contribution if you're fifty
years old or older. Now that's a total of thirty thousand,
five hundred per year for older workers and with iras,
the contribution is seven thousand, with a one thousand dollars
catchup contribution for fifty year older, giving you eight thousand
dollars limit. So if you're not maxing out these limits,
(50:44):
you're leaving money and growth on the table. And employer
matches in particular are essentially free money that should that
you should really take full advantage of. So here are
some steps to avoid this mistake. To break down some
practical steps to avoid the trap of tapping into your
(51:04):
retirement savings early. Number one, plan early, start saving as
early as possible, because the power of compound and growth
can't be overstated. Number two, build an emergency fund. One
of the best ways to avoid dipping into four to
one ks is to have an emergency fund. Aim to
(51:25):
save at least three to six months worth of living
expenses in a high yield savings account.
Speaker 1 (51:31):
Now.
Speaker 2 (51:31):
This will give you a financial cushion for any unexpected
expenses and prevent you from making a bad decision like
tapping into your four to one K. Number three, maximize
your contributions. If you're fifty years old or older, use
that ketchup contribution to supercharger savings, and every extra dollar
that you invest today will pay dividends in retirement. Number four.
(51:56):
Treat retirement accounts as though they are sacred. View your
four to one K and your IRA is untouchable until
retirement because they're your safety net for when you no
longer have a regular paycheck. The fifth piece is consult
a financial advisor. If you're facing financial challenges, a financial
advisor can help you explore alternatives to withdraw Alternatives to
(52:21):
withdrawing from your retirement accounts. Sometimes refinancing debt or creating
a stricter budget can solve the problem without jeopardizing your future.
So why protecting your four to one K matters? It matters,
So you want to think of your retirement savings as
a golden goose. The egg it lays is the future income.
(52:47):
So if you raid the nest and harm the goose,
you're going to have fewer eggs in those years to come.
So retirement planning is really it's a journey, and it
requires great patience, discipline, and a commitment to making smart
decisions all the way. So let's recap these five mistakes
(53:08):
that we've discovered. The first is not having a plan.
Without a roadmap, you're flying blind, and a written retirement
plan is the first step toward financial security. The second
is saving in the wrong places. Now a diversified portfolio
helps your money grow while managing risk. Number three underestimating expenses.
(53:32):
These expenses are healthcare costs, inflation, and lifestyle choices that
can drain your savings faster than you think. The fourth
piece we covered is claiming Social Security too early, so
waiting until your full retirement age or longer can significantly
boost your benefits. The fifth and final piece is tapping
(53:54):
into your four to one K two early, so taxes, penalties,
and lost growth really make this a costly mistake. You've
worked hard to build a career, to support your family
and to save for the future. Well now it's time
to take care of you. So make a plan, stick
to it, and set yourself up for your retirement that
(54:17):
you deserve. So if today's discussion has resonated with you,
don't wait to take the next step. Call me at
five point eight two zero three one nine eight three
or visit PRESCOTTPW dot com and set your appointment, go
to new clients and follow the three step process. So
(54:38):
as you think about your retirement your retirement, remember this,
it's not just about the numbers. It's about your freedom.
Freedom to spend your days as you choose, pursue your passions,
and enjoy the fruits of your labor. Thank you for
joining me today on your money matters with Drew Prescott,
Chartered Retirement Planning counselor an accredited Wealth Management advisor at
(55:02):
Prescott Private Wealth in Troy, New York. So until next time,
take care of your finances, plan smart, and enjoy the
journey to a fulfilling retirement. God bless you all and
thank you so much for taking the time out on
this beautiful Sunday, and hope that you have a wonderful weekend.
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Therapy Gecko
An unlicensed lizard psychologist travels the universe talking to strangers about absolutely nothing. TO CALL THE GECKO: follow me on https://www.twitch.tv/lyleforever to get a notification for when I am taking calls. I am usually live Mondays, Wednesdays, and Fridays but lately a lot of other times too. I am a gecko.