June 6, 2025 • 35 mins
5 Biggest Stealth Retirement Costs – Chris Boyd and Jeff Perry review a recent article
from Kiplinger’s magazine (linked below) as they discuss the “Five Biggest Stealth Costs
in Retirement.” The conversation begins with the notion that most people planning for
retirement have a basic understanding of their future cash flow needs. Chris and Jeff dig
into the costs that many people make incorrect assumptions about or ignore all together.
Included in the conversation are unexpected health care costs, income tax errors,
unanticipated financial emergencies, family member needs/gifts, and the long-term
impacts of inflation.
https://www.kiplinger.com/retirement/the-biggest-stealth-costs-in-retirement
For more information or to reach TEAM AMR, click the following link:
https://www.wealthenhancement.com/s/advisor-teams/amr
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:00):
Welcome to Something More with Chris Boyd.
Chris Boyd is a certified financial planner practitioner
and senior vice president financial advisor at Wealth
Enhancement Group, one of the nation's largest registered
investment advisors.
We call it Something More because we'd like
to talk not only about those important dollar
and cents issues, but also the quality of
life issues that make the money matters matter.
(00:22):
Here he is, your fulfillment facilitator, your partner
in prosperity, advising clients on Cape Cod and
across the country.
Here's your host, Jay Christopher Boyd.
Welcome everybody, thanks for being with us for
another episode of Something More with Chris Boyd.
I'm here with Jeff Perry.
We are both of the AMR team with
Wealth Enhancement Group and happy to have you
(00:42):
with us again.
If you are just joining us for the
first time, know that we welcome your calls,
your questions, the mailbag, as you guys did
recently.
We'd love to hear from you if you
would like to reach out.
AMR-info at wealthenhancement.com, toll free 866
(01:03):
-771-8901.
If you have your own personal questions, we're
happy to do a consultation as well.
Today, we are talking about some of the
biggest unexpected challenges that people face in retirement.
Jeff, you had come across a really good
article in Kiplinger, which Kiplinger is really a
(01:24):
good quality magazine.
It is, it is.
That's probably something worth promoting if people are
looking for just a good publication.
Kiplinger has been consistent over the years of
having good stuff.
Decades and decades.
I don't know how long it's been, but
they're facing all the challenges that the magazine
(01:44):
industry is facing, right?
Yeah.
The cost of delivering a magazine to people
is not inexpensive.
And so the size of our magazines is
going down and they're all transitioning, but I
have always found them to be- Kind
of taken over Money Magazine's role, right?
Yeah.
(02:04):
Money Magazine.
To your point.
No, absolutely.
I think Money Magazine's gone from publication.
Yeah.
Yeah.
It's just a web.
Sorry, I interrupted.
You were saying they've been quality for a
long time.
Quality for a long time.
A little bit above the basic.
Money was kind of the basics, but still,
(02:24):
they're writing for the masses as we talk
about sometimes.
But I don't see a bias in their
writing.
They seem to be open-minded to different
topics and subjects and opinions.
It is.
That's a good suggestion if people are looking
for a publication.
Yeah.
Lots of good articles that are...
I mean, they've got the flashy headlines at
times, but it tends to...
(02:45):
Everyone's got to have a hook, right?
But at the same time, it's good financial
content, I think, for sound personal finance strategies
and so forth.
Yep.
Keep you informed.
Well, in any case, a good article from
that.
You want to set things up to talk
about this or you want me to?
(03:05):
What do you want to do?
Well, it inspired me because we do formal,
comprehensive financial planning for our clients, meaning we
really dig down to their assets, their cash
flows, their expenses, their goals, their dreams, their
risks, not just their risks from being under
-invested or their risks of being over-invested,
(03:27):
but their risk of things that they don't
even think about, right?
So, and I have seen in my own
experience with friends, neighbors, and certainly see it
with clients, is when people get ready to
retire, or they're thinking about their retirement, and
you ask them, like, so what do you
spend every year?
(03:48):
They have a handle on it, you know?
Some people have an exact number, and I
worry about those people a little bit.
Like, I'm just kidding.
But, you know.
You're impressed by it, I know.
I am impressed by it.
No, but most people, when you talk to
them, they go through, they start thinking, what
do I pay every month, right?
And they know they have, maybe they have
(04:09):
a mortgage, maybe they have rent.
They know they have property taxes.
They know they have utilities, car payments, car
repairs.
You know, they know they have food, which
is a big help for people now.
And they kind of come up with a
number, and it's almost always too low, because
they forget things.
But even more riskier to their long-term
(04:31):
success of their plan is the things that
don't come up frequently.
The things that they, well, the things that
change in retirement.
And they either don't attribute an appropriate dollar
amount, or they just miss it all together.
And this article talks about the stealth things
that can really destroy your cashflow in retirement.
(04:53):
And so I thought it was, since we
see it almost every day.
There are plenty of them, right?
There are just things that you maybe underestimate,
or maybe just don't think about until, you
know, there's a cost.
The first one on the list is one
that I think we see all the time,
(05:14):
especially people that we know very well, and
they get older, is healthcare costs.
So even if you retire, and you have
Medicare and a good supplement, or you have
a good company plan, if you retired early,
and you think like, okay, I usually spend
a couple thousand dollars a year on my
non-covered medical things.
(05:36):
But the older that you get, the more
this healthcare cost creeps up and up, and
things that you didn't even forecast.
We have some good friends, and they're not
that old.
They're older than us, but they're not that
old.
And they're just going through this period of
expensive dental work.
(05:57):
Yeah, that's a big one.
Yeah.
Hearing aids and dental implants.
Right.
These are like big things that kind of
seem to crop up at a certain age
that hadn't been an issue before that.
Right.
Everybody has a dental trip.
Some people might've gone to the dentist today,
that Adil is saying.
I don't know.
(06:18):
But- I just came from a dental
cleaning yesterday.
Jeff is giving me a hard time.
And whether or not you have dental insurance,
it's usually maybe one thing happens a year,
and you go in, just as you get
older, that filling, that cavity, that one crown
that fell off, that you need another one.
(06:39):
Right, right.
And you can kind of handle it.
It's a couple thousand bucks.
Right.
And then you- You start to multiply.
You need a root canal, you know, then.
But when you talk about these posts, and
implants, and bridges, it gets really expensive.
Yeah.
So, the number one- Hearing aids is
another thing that I've run into, where, you
(07:01):
know, maybe it's a certain age range that
clients start to face this as a need.
It's legitimate, yeah.
But, apparently, they can be quite costly too.
And that's an example of an unexpected, a
stealth expense related to healthcare.
Could be other things, like actual deductibles, and
(07:24):
co-pays with a hospital stay, or something
like that.
More severe.
Yeah.
Do we include late in life, like longer,
long-term care kind of related expenses?
I think we should, because, you know, one
of the- I was referencing the financial
plan, and things that people forget.
(07:45):
But one of the things that we do
with our clients is, even when we get
all the data right, we believe we have
it right.
Yeah.
We start to talk about what ifs, and
we stress test the plan for what ifs,
and, you know, the big one, there's a
lot of them, but the big one that
comes up that most people really haven't contemplated.
(08:06):
They might know it might happen to somebody
else, but they really can't process that it
could happen to them as a long-term
care event.
Yeah, yeah.
And the costs associated with that, even if
you're talking at home, you know, it doesn't
have to be like a nursing home stay,
necessarily.
Right.
(08:26):
Maybe it's just the need for extra care
at home, and having people come in more
regularly for various considerations, that can really have
an additional cost that's beyond your regular cashflow
plan.
Even if it's not a permanent thing, you
(08:46):
know, you could have an injury or an
illness where you need some convalescing at home,
but you may need a few months of
extra help, and that's very expensive.
Yeah.
Well, I would add just, you know, when
you're talking about stress testing, we can come
back if there's more you wanna talk about
the healthcare component, but I think that's clearly
(09:08):
one that comes up and can be pretty
significant and pretty dramatic when unexpected.
And, you know, this article talked about, what
was it, 43%?
What was that 43% about that people
are having stress, and the unexpected costs create
(09:34):
a lot of stress for them in retirement.
But in any case, I think the one
thing that you talked about that we do
often stress test for is inflation.
You know what I mean?
And that's, I think, more on people's minds
the last year or two.
Because of 2022, we had that big run
(09:57):
-up in inflation temporarily, and the Fed's drastic,
you know, effort to try to rein in
inflation.
That hit some of our listeners, I'm sure,
with an awareness of, you know, that this
is something I've got a plan for.
(10:18):
We usually have seen, we've been kind of
spoiled over the last 20 years plus, maybe.
Even in a low inflationary environment with maybe
2% inflation, or even lower as the
norm.
I think if we were, you know, when
I started in the industry in the 90s,
(10:39):
we used to talk about long-term inflation
as three and a half percent.
And maybe 3% over a shorter period
of time.
You know, now you get to where we've
been, 2% for a long time.
The Fed's goal is 2%, but whether they're
gonna be able to achieve that.
And, you know, we've talked about this before,
(11:00):
but going from, you know, an environment where
we were increasing our free trade and exporting
arguably jobs, but, you know, manufacturing costs to
lower expense locations.
Sure.
Was helping to keep inflation low as we
(11:21):
look to reverse that pretty, you know, dramatically
with the trade policies that are proposed.
Trying to bring more of that activity back
to our shores.
That will probably raise costs and that could
show up in the form of inflation.
So we may need to start thinking about
(11:42):
a higher inflation assumption.
That's something we should probably think about.
We've kind of been using two and a
half percent as a number of late over
the years.
And then we stress test for, you know,
three and a half percent or something.
But yeah, it might be time to revisit
that.
Probably is.
(12:03):
You're right to note that the inflation spike
after COVID, after the government, all the government
spending and everything that, you know, really in
the supply chain stuff, it got people's attention,
which is good.
Good that it got their attention, not good
that it happened.
But it points out a longer stealth risk
(12:26):
to a financial plan is for those individuals
who are doing their own planning and saying,
okay, spend $5,000 a month, $60,000
a year.
Right now I bring in 70.
I'm good, I have extra cash.
But if you don't include that inflation factor
and to your most recent point, the correct
(12:46):
inflation factor, and you're going to be in
retirement 20 or 30 years, think about how
much things cost 20 or 30 years ago.
And so 20, 30 years from now, you're
purchasing a new car or you're just buying
your weekly groceries or you're doing a home
(13:06):
repair.
If you haven't factored that cumulative effect of
two or 3% a year, into your
cashflow projections, you're going to have a struggle
more than likely at the end of your
life when it's supposed to be the easiest
time.
I used to do these seminars and we'd
(13:27):
start off with, when we talk about inflation,
we'd say, all right, how many people today
came in a car that cost more than
their first house?
Hands go up.
And at that time, almost everybody's hand would
go up.
And I don't know if that's still the
(13:48):
case, but- Maybe if some of our
older clients, but if you're buying a car
today at 50,000, which isn't crazy, right?
20 years from now, it's going to be
six digits.
Yeah, right.
So, yeah.
So, well, all right.
(14:10):
So inflation, you got to be planning for.
Healthcare costs, we got to be planning for.
You just mentioned the idea of home repairs
and maintenance.
I think that's something we don't always include
in our budget.
We tend to say, well, what's it cost
for the, you know, what do you spend?
And you kind of say, well, yeah, I
(14:30):
had to do that.
One time though.
That was a one-off.
Yeah, exactly.
And the roof, I won't need that for
20 years or whatever.
But, you know, then there's renovations.
Then there's, you know, new appliances or whatever.
And it's not every year.
(14:51):
It's not all the time.
It's almost every year, something.
There's something maybe.
But as far as like either to include
it in the budget as a either annually
or maybe every few years there's a outlay
of some note or to just say, hey,
you know, I expect we're going to want
(15:12):
to renovate the kitchen, the bathroom, some other,
you know, major house expense periodically.
We should plan for that as part of
our plan in the mix.
I don't think most people do that.
Do you?
No, I don't think most people do.
And sadly, I've seen lately a few folks
(15:33):
I know who are mortgage free and in
retirement and they're doing fine and something comes
up and they just don't have the assets,
the liquid assets.
And then they go back to a home
equity.
And now they have, you know, it solves
their problem, you know, for that new roof,
for that big repair, right?
(15:53):
But now they have a payment which wasn't
projected in their cashflow.
Hmm.
So I love the idea of, you know,
talking about it in a financial plan, but
also planning for it with the form of
a bucket or a silo of money, you
know, dedicated for emergencies generally is fine.
Yeah.
But having that reserved that if the AC
(16:14):
heating unit goes out and it's $10,000
that you're not running to the bank to
get a loan or you're not going without
some people, you know, we see these stories
that people, especially in the Northeast where people
couldn't fix their furnace and nobody knows and
they're just trying to get through.
So having that liquidity bucket that you can
(16:36):
handle a couple of these things without chaos.
Yeah.
I think it's challenging sometimes to plan for
things.
Things tend to come up at the wrong
time.
You know, you're talking about that furnace or,
oh, I know I need this, you know,
$10,000 expense, but I'm gonna put it
(16:59):
off or whatever.
And then how do you plan for the
timing of that in a way that is
more manageable, less disruptive?
You know, if it's something where you're taking
it from investments and the market's down, it's
bad, right?
So yeah, just, well, anyway, that's one of
(17:21):
those things.
I think it's perpetually challenging just as a
planning.
It's definitely challenging.
And I'm hoping, you know, with this conversation
that we're having is people can consider this
before they need it.
You know, what's, I'm gonna attribute the quote
to the wrong person.
(17:42):
So I'm not gonna attribute it to anyone.
It's just not mine.
It's, I haven't had an emergency since I've
had an emergency fund.
Yeah.
Because it's not an emergency anymore.
Yeah, yeah.
It's just, okay, you know, I don't wanna
spend 10 grand today, but I can and
I have to.
So, you know, if you're approaching retirement and
you're thinking about your plan or you're in
(18:03):
early stages of retirement and you have some
ability to put some money away, this is
something that you should do.
We're not asking you to give up the
money.
We're just asking you to segregate it perhaps.
Well, to your point, I mean, one of
the things that sometimes people recommend is to
have one to 2% of your home's
value planned annually for repairs and maintenance and
(18:30):
that kind of a possibility.
Right.
Oh, good.
Good financial planning and business.
You take part of your earnings and retain
them, retained earnings for future needs.
That could be, you know, cashflow pressures or
it could be growth or opportunities.
It's just, you know, we're talking about stealth
(18:51):
things that can erode your retirement and certainly
an unexpected repair.
Well, we're calling them unexpected, but if you
retire and you're- You should expect some.
Yeah.
Yeah.
You know, too, similarly, you know, we've talked
about this before as well.
One of the solutions here can be, sometimes
maybe it makes sense to downsize or relocate
(19:13):
or maybe you upgrade to a newer place
that doesn't have as many of those kinds
of needs, but you can limit some of
the challenges you might face if you do
that relocation.
You know what I mean?
Hey, we owned a house that was 140
years old in downtown Sandwich, Maine.
(19:37):
I bet that always had costs.
A beautiful home, but we were clear, you
know, when we bought it that we bought
it in 2011, I think, that when we
retired, we did not want to live in
that home because the potential for repairs on
an older home is just even more difficult
(19:57):
to predict.
It can be a drain.
And serious repairs, you know?
Hey, let's go back one more, too, just
to the healthcare.
You know, how do people deal with that?
What are some suggestions they might, you know,
think about how to manage those costs?
I mean, one possibility is, you know, evaluate
whether long-term care insurance is an appropriate
(20:19):
tool for you.
It's expensive at times and sometimes can be
an absolute cost.
Sometimes people think in terms of a sinking
fund, you know, that just they have sort
of a segregated funds allocated with that expense
in mind.
You're an advocate of that, right, Jeff?
(20:39):
Absolutely.
And then, you know, maybe there's other things,
like if your work plan allows for a
HSA, maybe you stock money away in your
HSA while you're working.
Excellent.
That you can use it in your retirement
to help some of these costs.
Maybe you invest in trying to stay healthy.
(21:02):
Well, that's a great investment in my mind.
You know, some of the activities that will
foster a healthier lifestyle or that kind of
thing could also be relevant.
I don't know, those were just a couple
of things.
One final thing on healthcare, the article touches
on this, and I mean, we didn't say
(21:24):
it probably because it's so obvious, but make
sure you have the right health insurance.
You know, some people push that, you know,
whether it's somebody young, and they say, I'm
healthy, or going into retirement, I'm just gonna
have Medicare and, you know, some free supplement
that I can get, or really, they focus
(21:45):
on cost more than quality after they leave
their employer.
And that can be a stealth loss if
you have a serious issue and you have
a 20% co-pay, for example.
I mean, it's not unusual.
It's a great point, because you gotta start
with the basics, right?
Fundamentals, right?
(22:07):
Blocking and tackling, right?
When it's football.
But when it comes to financial planning, some
basic insurance protection, your whole plan can be
disrupted if you don't have the basics covered.
And that means homeowners insurance, that means health
insurance.
We don't like these expenses.
Nobody wants to spend it, and health insurance,
(22:29):
ridiculously expensive.
Ridiculously expensive.
There's just no getting around it.
It's like insane.
But if you don't have it, the alternative
of, you know, if you end up having
to pay for a major surgery, cancer treatment,
fill in the blank of like some serious
health issue, you'll be devastated financially.
(22:50):
Yeah, we know that in bankruptcy, the number
one reason that for personal bankruptcies is a
medical event, uninsured medical event.
So we feel like it's not gonna happen
to us, but we know it does happen,
so.
Yeah, good point.
All right, good topics.
Hey, just one other thing.
We talked about inflation.
Let me just go back to that.
(23:11):
How would you say people can prepare for
inflation?
It's all about having a financial plan and
not one on the back of a napkin
about a comprehensive financial plan that calculates in,
you know, your future cash flows.
Not the cash flow on retirement day, but
the cash flow 30 years from now with
some projections and some allowances, it will give
(23:33):
you, you know, a more accurate depiction of
whether or not you're ready.
That's a good point.
And the way you think about your investments,
the way you design your portfolio is gonna
help to mitigate that risk.
Maybe we talk about social security decisions a
lot.
Sometimes that's maybe factors into helping to mitigate
the inflationary concerns.
All right, what were some of the other
(23:54):
of the five big ones that they talked
about There were two others in this article.
One was taxes.
And I do see that with people who
don't appropriately calculate the taxes in retirement or
they just, you know, it's not they forget.
They just don't appreciate that when they were
working, they had taxes withheld.
(24:14):
Yeah.
And, you know, we see clients and, you
know, here's stories of like people taking withdrawals
from their retirement savings or taxable brokerage account.
And, you know, we talked to them at
that time, like, do you need to withhold
taxes?
And so many people who get in trouble,
don't contemplate and say, no, I'll deal with
(24:34):
that later.
Or they put it off, right?
Yeah.
And they say, you know, or I'm gonna
put that money back.
So I don't need it, right?
Yeah.
Things like that.
And then it kind of snowballs where they
use that money and then don't have liquid
money.
Yeah.
So you need to pay.
And they're like, I had such a big
tax bill.
Why?
You know, and then they have to take
(24:57):
more money out of their retirement plan again
for the next year.
So they got a big tax bill again,
you know, that kind of thing.
You can see these kinds of things over
and over again happening, right?
I had one neighbor probably two weeks ago
that was complaining about his CPA and said
that, you know, he made all the estimated
taxes that he told them to make.
So I was drilling down with them a
(25:19):
little bit.
And to this example, exactly, he said, well,
I guess I took an extra withdrawal last
year and didn't withhold any money on it.
Darn CPA.
Did you call your CPA and tell him
this?
Yeah.
He was basing it upon, you know, the
previous year.
So, you know, it's just pay attention to
it, right?
(25:39):
You pay quarterlies probably for a reason, but
do a calculation when you're paying that quarterly
and say, am I on track?
Yeah.
Or sit down with your advisor and say,
you know, I feel like I've had a
lot of capital gains this year or, you
know, I took that extra withdrawal.
Do you think I need to increase my
quarterly?
Talk to somebody about it, do a calculation
(26:01):
as you're doing the quarterly so you don't
get surprised by a big tax bill that
you can't pay.
Yeah, good point.
I would say we oftentimes talk in our
financial planning process about strategy around tax diversification
and the tax prioritization, where to draw from,
and that can have virtue, but it can
(26:23):
be challenging too.
And there's times when people don't want to
draw down their taxable accounts first fully, you
know.
We often try to think in terms of
sequence, try to use the taxable account money
first, IRA type money second, and then the
Roth money last, thinking that's going to grow
(26:43):
the most and we want it to tax
-free, you know, maximum growth potential.
But sometimes we got to revisit that because,
oh, our tax bracket went down.
Maybe we want to prioritize paying some taxes
sooner, whether that means to use that money
for withdrawal or do a conversion or whatever
it might be.
But paying attention to these tax considerations is
(27:08):
a real planning opportunity.
And sometimes it's, well, let's face it for
all of us, it's frustrating.
Nobody likes taxes, right?
Well, that's all the more reason to do
it though.
You know, you mentioned that kind of general
rule that you hear people say, taxable first,
IRAs, Roth.
But that's not, it's a general rule, fine,
but it's not the right rule or the
(27:30):
- In all circumstances, yeah.
It may be right for you one year,
but the next year maybe you should have
a whole different strategy because of your current
tax situation.
So it's where these general rules kind of
- Yeah.
So it goes back to making sure you
have the right financial planning guidance in this
process.
A good tax advisor, that CPA that someone
(27:51):
was complaining about, right?
But, you know, you got to keep them
in the loop, keep them involved, get good
guidance in the process between your financial advisor,
your tax advisor and so forth, the state
planning and all the rest of it and
the whole team of people you deal with.
So that was, yeah, go ahead.
Speaking of team, the last stealth- Yes.
(28:13):
Item is family.
We've talked about this one before, the unexpected
expense that inevitably hits a lot of families
with expense and unexpectedly.
What are common circumstances that lead to this?
(28:34):
Well, so it could be a positive that
you want to be generous, or it could
be, I hate to use the word negative,
but it could be a challenge.
So it could, on a positive side, you
could have this inspiration to help someone go
to college or someone buy their first home
or someone get married, you know, a nice
wedding or someone, whatever.
(28:55):
A gifting strategy that you want to be
gifting to them routinely.
Right.
But you could do too much.
You could do too much.
So you don't want to give away all
your resources before you're done needing them.
Yeah.
There's also a circumstance where family members have
unexpected divorce or health issues or whatever it
(29:18):
may be.
There can be these things of that sort.
And parents so frequently want, we've talked about
this many times, but they want to help.
They care about family first, right?
We all care about our family.
Of course.
However, there are times when sometimes that can
be abused, or you have to give thought
(29:39):
to, am I able to do this?
So, you know, I'd like to help, but
am I able to do it in a
way that doesn't put my own financial security
in jeopardy?
Right.
And sometimes you have to show restraint or
you risk your own financial security in the
process.
(29:59):
Yep.
And be careful, even if you, make sure
that people understand what you're offering to do.
Never say I'll pay for your wedding.
Yeah.
Because your wedding could be- What's that
mean?
That could be open-ended, yeah.
It could be $5,000 or $50,000.
Make sure you're- Gotta be specific, be
(30:22):
precise.
If you're being generous or if you're helping
out a loved one who maybe has a
job loss or a divorce or whatever the
situation, talk to your spouse if you have
one, talk to your financial planner and come
up with a figure or a way to
help somebody and articulate it with specificity that
we're helping you for two months.
(30:42):
You know, we can help you for two
months.
That's what we can afford or we can
contribute $5,000 to the wedding or whatever
it is.
And that way the generosity is understood and
appreciated.
And the person receiving it didn't hire a
12 piece band for the wedding.
Yeah.
It doesn't think that mean they have a
year off and they can just go the
(31:04):
slow path of getting that next job.
So it applies- No, that's a great
point.
And then similarly, like you, if you are
saying, well, maybe I'll help them.
I was meeting with people recently in various
circumstances.
They bought a house that they were now
having a family member reside in, a condo
(31:24):
house.
I forget what it was, but the idea.
And so, but I'm going to charge you
rent or that you maybe, if you take
on the mortgage of their place that you
have a contract or, you need to have,
(31:47):
I mean, let's face it.
It's very hard to, you're going to go,
collect on that and- Foreclose.
Foreclose on someone.
You know, so you really have to give
detailed thought, but when possible, put it in
some like formalized terms so that everybody's on
(32:09):
the same page.
This is what we're agreeing to.
And that having that formality about it makes
it less of a, well, you know, mom
can afford that or dad can afford that.
You know, they can, they won't mind.
A lot of times parents don't tell what
they can and can't afford.
And it's just assumed that their resources are
(32:30):
oftentimes greater than they may even be.
So, yeah.
So be specific and, you know, document it.
And I think that's great advice.
And that way the recipient is appreciative of
what you're doing and they understand it.
And there's no hard feelings later.
Yeah, and to, I think we've had this
theme throughout.
Work with your financial planner to evaluate what
(32:52):
can you really do that you can afford?
Or if it's gonna be challenging, how do
you navigate?
What do I need to do to be
able to do what I want to help?
It may mean some changes need to occur,
you know?
And so you can evaluate what's gonna be
the way that gets you to the end
(33:14):
result that you most value and want, you
know?
Super important.
Because when you have that financial plan in
place, then you can go to the advisor
and say, I'm thinking of doing this.
Does it affect my longevity, my plan?
How does this work?
And then you get, you know, kind of
relief that it doesn't, or you get like
a point of caution to say, all right,
maybe I should do something else as you
(33:36):
indicated.
And sometimes too, you can have the benefit
of saying, well, I wanted to, but my
financial advisor.
Yeah, blame us, it's fine.
You know, if it helps, if you have
that kind of need for a little buffer,
you know, you can be like, oh, I
really was hoping to do more, but my
financial advisor tells me, you know, that kind
(33:57):
of thing.
Nothing wrong with that.
Sometimes it's helpful to have that third party
in the mix in that role.
Absolutely.
But it's ultimately, in reality, money is yours.
These decisions are yours.
Sure.
We're here to counsel and guide, but you
know, it's ultimately up to you how you
handle these issues, but we can try to
(34:19):
give you guidance and help in the process.
So I guess that's a good place for
us to wind down, Jeff.
If there's anything that you need listeners as
you run into your personal challenges of these
stealthy issues, maybe it's a good time to
update your financial plan.
Make sure you're addressing all of these issues
(34:41):
and have them well thought out.
We can be a resource in the process.
Don't hesitate to reach out.
Until next time, everybody keeps striving for something
more.
Thank you for listening to Something More with
Chris Boyd.
Call us for help, whether it's for financial
planning or portfolio management, insurance concerns, or those
quality of life issues that make the money
(35:02):
matters matter.
Whatever's on your mind, visit us at somethingmorewithchrisboyd
.com or call us toll-free at 866
-771-8901 or send us your questions to
amr-info at wealthenhancement.com You're listening to
Something More with Chris Boyd Financial Talk Show.
(35:23):
Wealth Enhancement Advisory Services and Jay Christopher Boyd
provide investment advice on an individual basis to
clients only.
Proper advice depends on a complete analysis of
all facts and circumstances.
The information given on this program is general
financial comments and cannot be relied upon as
pertaining to your specific situation.
Wealth Enhancement Group cannot guarantee that using the
information from this show will generate profits or
ensure freedom from loss.
Listeners should consult their own financial advisors or
(35:45):
conduct their own due diligence before making any
financial decisions.
Welcome to Something More with Chris Boyd.
Chris Boyd is a certified financial planner practitioner
and senior vice president financial advisor at Wealth
Enhancement Group, one of the nation's largest registered
investment advisors.
We call it Something More because we'd like
to talk not only about those important dollar
and cents issues, but also the quality of
life issues that make the money matters matter.
(00:22):
Here he is, your fulfillment facilitator, your partner
in prosperity, advising clients on Cape Cod and
across the country.
Here's your host, Jay Christopher Boyd.
Welcome everybody, thanks for being with us for
another episode of Something More with Chris Boyd.
I'm here with Jeff Perry.
We are both of the AMR team with
Wealth Enhancement Group and happy to have you
(00:42):
with us again.
If you are just joining us for the
first time, know that we welcome your calls,
your questions, the mailbag, as you guys did
recently.
We'd love to hear from you if you
would like to reach out.
AMR-info at wealthenhancement.com, toll free 866
(01:03):
-771-8901.
If you have your own personal questions, we're
happy to do a consultation as well.
Today, we are talking about some of the
biggest unexpected challenges that people face in retirement.
Jeff, you had come across a really good
article in Kiplinger, which Kiplinger is really a
(01:24):
good quality magazine.
It is, it is.
That's probably something worth promoting if people are
looking for just a good publication.
Kiplinger has been consistent over the years of
having good stuff.
Decades and decades.
I don't know how long it's been, but
they're facing all the challenges that the magazine
(01:44):
industry is facing, right?
Yeah.
The cost of delivering a magazine to people
is not inexpensive.
And so the size of our magazines is
going down and they're all transitioning, but I
have always found them to be- Kind
of taken over Money Magazine's role, right?
Yeah.
(02:04):
Money Magazine.
To your point.
No, absolutely.
I think Money Magazine's gone from publication.
Yeah.
Yeah.
It's just a web.
Sorry, I interrupted.
You were saying they've been quality for a
long time.
Quality for a long time.
A little bit above the basic.
Money was kind of the basics, but still,
(02:24):
they're writing for the masses as we talk
about sometimes.
But I don't see a bias in their
writing.
They seem to be open-minded to different
topics and subjects and opinions.
It is.
That's a good suggestion if people are looking
for a publication.
Yeah.
Lots of good articles that are...
I mean, they've got the flashy headlines at
times, but it tends to...
(02:45):
Everyone's got to have a hook, right?
But at the same time, it's good financial
content, I think, for sound personal finance strategies
and so forth.
Yep.
Keep you informed.
Well, in any case, a good article from
that.
You want to set things up to talk
about this or you want me to?
(03:05):
What do you want to do?
Well, it inspired me because we do formal,
comprehensive financial planning for our clients, meaning we
really dig down to their assets, their cash
flows, their expenses, their goals, their dreams, their
risks, not just their risks from being under
-invested or their risks of being over-invested,
(03:27):
but their risk of things that they don't
even think about, right?
So, and I have seen in my own
experience with friends, neighbors, and certainly see it
with clients, is when people get ready to
retire, or they're thinking about their retirement, and
you ask them, like, so what do you
spend every year?
(03:48):
They have a handle on it, you know?
Some people have an exact number, and I
worry about those people a little bit.
Like, I'm just kidding.
But, you know.
You're impressed by it, I know.
I am impressed by it.
No, but most people, when you talk to
them, they go through, they start thinking, what
do I pay every month, right?
And they know they have, maybe they have
(04:09):
a mortgage, maybe they have rent.
They know they have property taxes.
They know they have utilities, car payments, car
repairs.
You know, they know they have food, which
is a big help for people now.
And they kind of come up with a
number, and it's almost always too low, because
they forget things.
But even more riskier to their long-term
(04:31):
success of their plan is the things that
don't come up frequently.
The things that they, well, the things that
change in retirement.
And they either don't attribute an appropriate dollar
amount, or they just miss it all together.
And this article talks about the stealth things
that can really destroy your cashflow in retirement.
(04:53):
And so I thought it was, since we
see it almost every day.
There are plenty of them, right?
There are just things that you maybe underestimate,
or maybe just don't think about until, you
know, there's a cost.
The first one on the list is one
that I think we see all the time,
(05:14):
especially people that we know very well, and
they get older, is healthcare costs.
So even if you retire, and you have
Medicare and a good supplement, or you have
a good company plan, if you retired early,
and you think like, okay, I usually spend
a couple thousand dollars a year on my
non-covered medical things.
(05:36):
But the older that you get, the more
this healthcare cost creeps up and up, and
things that you didn't even forecast.
We have some good friends, and they're not
that old.
They're older than us, but they're not that
old.
And they're just going through this period of
expensive dental work.
(05:57):
Yeah, that's a big one.
Yeah.
Hearing aids and dental implants.
Right.
These are like big things that kind of
seem to crop up at a certain age
that hadn't been an issue before that.
Right.
Everybody has a dental trip.
Some people might've gone to the dentist today,
that Adil is saying.
I don't know.
(06:18):
But- I just came from a dental
cleaning yesterday.
Jeff is giving me a hard time.
And whether or not you have dental insurance,
it's usually maybe one thing happens a year,
and you go in, just as you get
older, that filling, that cavity, that one crown
that fell off, that you need another one.
(06:39):
Right, right.
And you can kind of handle it.
It's a couple thousand bucks.
Right.
And then you- You start to multiply.
You need a root canal, you know, then.
But when you talk about these posts, and
implants, and bridges, it gets really expensive.
Yeah.
So, the number one- Hearing aids is
another thing that I've run into, where, you
(07:01):
know, maybe it's a certain age range that
clients start to face this as a need.
It's legitimate, yeah.
But, apparently, they can be quite costly too.
And that's an example of an unexpected, a
stealth expense related to healthcare.
Could be other things, like actual deductibles, and
(07:24):
co-pays with a hospital stay, or something
like that.
More severe.
Yeah.
Do we include late in life, like longer,
long-term care kind of related expenses?
I think we should, because, you know, one
of the- I was referencing the financial
plan, and things that people forget.
(07:45):
But one of the things that we do
with our clients is, even when we get
all the data right, we believe we have
it right.
Yeah.
We start to talk about what ifs, and
we stress test the plan for what ifs,
and, you know, the big one, there's a
lot of them, but the big one that
comes up that most people really haven't contemplated.
(08:06):
They might know it might happen to somebody
else, but they really can't process that it
could happen to them as a long-term
care event.
Yeah, yeah.
And the costs associated with that, even if
you're talking at home, you know, it doesn't
have to be like a nursing home stay,
necessarily.
Right.
(08:26):
Maybe it's just the need for extra care
at home, and having people come in more
regularly for various considerations, that can really have
an additional cost that's beyond your regular cashflow
plan.
Even if it's not a permanent thing, you
(08:46):
know, you could have an injury or an
illness where you need some convalescing at home,
but you may need a few months of
extra help, and that's very expensive.
Yeah.
Well, I would add just, you know, when
you're talking about stress testing, we can come
back if there's more you wanna talk about
the healthcare component, but I think that's clearly
(09:08):
one that comes up and can be pretty
significant and pretty dramatic when unexpected.
And, you know, this article talked about, what
was it, 43%?
What was that 43% about that people
are having stress, and the unexpected costs create
(09:34):
a lot of stress for them in retirement.
But in any case, I think the one
thing that you talked about that we do
often stress test for is inflation.
You know what I mean?
And that's, I think, more on people's minds
the last year or two.
Because of 2022, we had that big run
(09:57):
-up in inflation temporarily, and the Fed's drastic,
you know, effort to try to rein in
inflation.
That hit some of our listeners, I'm sure,
with an awareness of, you know, that this
is something I've got a plan for.
(10:18):
We usually have seen, we've been kind of
spoiled over the last 20 years plus, maybe.
Even in a low inflationary environment with maybe
2% inflation, or even lower as the
norm.
I think if we were, you know, when
I started in the industry in the 90s,
(10:39):
we used to talk about long-term inflation
as three and a half percent.
And maybe 3% over a shorter period
of time.
You know, now you get to where we've
been, 2% for a long time.
The Fed's goal is 2%, but whether they're
gonna be able to achieve that.
And, you know, we've talked about this before,
(11:00):
but going from, you know, an environment where
we were increasing our free trade and exporting
arguably jobs, but, you know, manufacturing costs to
lower expense locations.
Sure.
Was helping to keep inflation low as we
(11:21):
look to reverse that pretty, you know, dramatically
with the trade policies that are proposed.
Trying to bring more of that activity back
to our shores.
That will probably raise costs and that could
show up in the form of inflation.
So we may need to start thinking about
(11:42):
a higher inflation assumption.
That's something we should probably think about.
We've kind of been using two and a
half percent as a number of late over
the years.
And then we stress test for, you know,
three and a half percent or something.
But yeah, it might be time to revisit
that.
Probably is.
(12:03):
You're right to note that the inflation spike
after COVID, after the government, all the government
spending and everything that, you know, really in
the supply chain stuff, it got people's attention,
which is good.
Good that it got their attention, not good
that it happened.
But it points out a longer stealth risk
(12:26):
to a financial plan is for those individuals
who are doing their own planning and saying,
okay, spend $5,000 a month, $60,000
a year.
Right now I bring in 70.
I'm good, I have extra cash.
But if you don't include that inflation factor
and to your most recent point, the correct
(12:46):
inflation factor, and you're going to be in
retirement 20 or 30 years, think about how
much things cost 20 or 30 years ago.
And so 20, 30 years from now, you're
purchasing a new car or you're just buying
your weekly groceries or you're doing a home
(13:06):
repair.
If you haven't factored that cumulative effect of
two or 3% a year, into your
cashflow projections, you're going to have a struggle
more than likely at the end of your
life when it's supposed to be the easiest
time.
I used to do these seminars and we'd
(13:27):
start off with, when we talk about inflation,
we'd say, all right, how many people today
came in a car that cost more than
their first house?
Hands go up.
And at that time, almost everybody's hand would
go up.
And I don't know if that's still the
(13:48):
case, but- Maybe if some of our
older clients, but if you're buying a car
today at 50,000, which isn't crazy, right?
20 years from now, it's going to be
six digits.
Yeah, right.
So, yeah.
So, well, all right.
(14:10):
So inflation, you got to be planning for.
Healthcare costs, we got to be planning for.
You just mentioned the idea of home repairs
and maintenance.
I think that's something we don't always include
in our budget.
We tend to say, well, what's it cost
for the, you know, what do you spend?
And you kind of say, well, yeah, I
(14:30):
had to do that.
One time though.
That was a one-off.
Yeah, exactly.
And the roof, I won't need that for
20 years or whatever.
But, you know, then there's renovations.
Then there's, you know, new appliances or whatever.
And it's not every year.
(14:51):
It's not all the time.
It's almost every year, something.
There's something maybe.
But as far as like either to include
it in the budget as a either annually
or maybe every few years there's a outlay
of some note or to just say, hey,
you know, I expect we're going to want
(15:12):
to renovate the kitchen, the bathroom, some other,
you know, major house expense periodically.
We should plan for that as part of
our plan in the mix.
I don't think most people do that.
Do you?
No, I don't think most people do.
And sadly, I've seen lately a few folks
(15:33):
I know who are mortgage free and in
retirement and they're doing fine and something comes
up and they just don't have the assets,
the liquid assets.
And then they go back to a home
equity.
And now they have, you know, it solves
their problem, you know, for that new roof,
for that big repair, right?
(15:53):
But now they have a payment which wasn't
projected in their cashflow.
Hmm.
So I love the idea of, you know,
talking about it in a financial plan, but
also planning for it with the form of
a bucket or a silo of money, you
know, dedicated for emergencies generally is fine.
Yeah.
But having that reserved that if the AC
(16:14):
heating unit goes out and it's $10,000
that you're not running to the bank to
get a loan or you're not going without
some people, you know, we see these stories
that people, especially in the Northeast where people
couldn't fix their furnace and nobody knows and
they're just trying to get through.
So having that liquidity bucket that you can
(16:36):
handle a couple of these things without chaos.
Yeah.
I think it's challenging sometimes to plan for
things.
Things tend to come up at the wrong
time.
You know, you're talking about that furnace or,
oh, I know I need this, you know,
$10,000 expense, but I'm gonna put it
(16:59):
off or whatever.
And then how do you plan for the
timing of that in a way that is
more manageable, less disruptive?
You know, if it's something where you're taking
it from investments and the market's down, it's
bad, right?
So yeah, just, well, anyway, that's one of
(17:21):
those things.
I think it's perpetually challenging just as a
planning.
It's definitely challenging.
And I'm hoping, you know, with this conversation
that we're having is people can consider this
before they need it.
You know, what's, I'm gonna attribute the quote
to the wrong person.
(17:42):
So I'm not gonna attribute it to anyone.
It's just not mine.
It's, I haven't had an emergency since I've
had an emergency fund.
Yeah.
Because it's not an emergency anymore.
Yeah, yeah.
It's just, okay, you know, I don't wanna
spend 10 grand today, but I can and
I have to.
So, you know, if you're approaching retirement and
you're thinking about your plan or you're in
(18:03):
early stages of retirement and you have some
ability to put some money away, this is
something that you should do.
We're not asking you to give up the
money.
We're just asking you to segregate it perhaps.
Well, to your point, I mean, one of
the things that sometimes people recommend is to
have one to 2% of your home's
value planned annually for repairs and maintenance and
(18:30):
that kind of a possibility.
Right.
Oh, good.
Good financial planning and business.
You take part of your earnings and retain
them, retained earnings for future needs.
That could be, you know, cashflow pressures or
it could be growth or opportunities.
It's just, you know, we're talking about stealth
(18:51):
things that can erode your retirement and certainly
an unexpected repair.
Well, we're calling them unexpected, but if you
retire and you're- You should expect some.
Yeah.
Yeah.
You know, too, similarly, you know, we've talked
about this before as well.
One of the solutions here can be, sometimes
maybe it makes sense to downsize or relocate
(19:13):
or maybe you upgrade to a newer place
that doesn't have as many of those kinds
of needs, but you can limit some of
the challenges you might face if you do
that relocation.
You know what I mean?
Hey, we owned a house that was 140
years old in downtown Sandwich, Maine.
(19:37):
I bet that always had costs.
A beautiful home, but we were clear, you
know, when we bought it that we bought
it in 2011, I think, that when we
retired, we did not want to live in
that home because the potential for repairs on
an older home is just even more difficult
(19:57):
to predict.
It can be a drain.
And serious repairs, you know?
Hey, let's go back one more, too, just
to the healthcare.
You know, how do people deal with that?
What are some suggestions they might, you know,
think about how to manage those costs?
I mean, one possibility is, you know, evaluate
whether long-term care insurance is an appropriate
(20:19):
tool for you.
It's expensive at times and sometimes can be
an absolute cost.
Sometimes people think in terms of a sinking
fund, you know, that just they have sort
of a segregated funds allocated with that expense
in mind.
You're an advocate of that, right, Jeff?
(20:39):
Absolutely.
And then, you know, maybe there's other things,
like if your work plan allows for a
HSA, maybe you stock money away in your
HSA while you're working.
Excellent.
That you can use it in your retirement
to help some of these costs.
Maybe you invest in trying to stay healthy.
(21:02):
Well, that's a great investment in my mind.
You know, some of the activities that will
foster a healthier lifestyle or that kind of
thing could also be relevant.
I don't know, those were just a couple
of things.
One final thing on healthcare, the article touches
on this, and I mean, we didn't say
(21:24):
it probably because it's so obvious, but make
sure you have the right health insurance.
You know, some people push that, you know,
whether it's somebody young, and they say, I'm
healthy, or going into retirement, I'm just gonna
have Medicare and, you know, some free supplement
that I can get, or really, they focus
(21:45):
on cost more than quality after they leave
their employer.
And that can be a stealth loss if
you have a serious issue and you have
a 20% co-pay, for example.
I mean, it's not unusual.
It's a great point, because you gotta start
with the basics, right?
Fundamentals, right?
(22:07):
Blocking and tackling, right?
When it's football.
But when it comes to financial planning, some
basic insurance protection, your whole plan can be
disrupted if you don't have the basics covered.
And that means homeowners insurance, that means health
insurance.
We don't like these expenses.
Nobody wants to spend it, and health insurance,
(22:29):
ridiculously expensive.
Ridiculously expensive.
There's just no getting around it.
It's like insane.
But if you don't have it, the alternative
of, you know, if you end up having
to pay for a major surgery, cancer treatment,
fill in the blank of like some serious
health issue, you'll be devastated financially.
(22:50):
Yeah, we know that in bankruptcy, the number
one reason that for personal bankruptcies is a
medical event, uninsured medical event.
So we feel like it's not gonna happen
to us, but we know it does happen,
so.
Yeah, good point.
All right, good topics.
Hey, just one other thing.
We talked about inflation.
Let me just go back to that.
(23:11):
How would you say people can prepare for
inflation?
It's all about having a financial plan and
not one on the back of a napkin
about a comprehensive financial plan that calculates in,
you know, your future cash flows.
Not the cash flow on retirement day, but
the cash flow 30 years from now with
some projections and some allowances, it will give
(23:33):
you, you know, a more accurate depiction of
whether or not you're ready.
That's a good point.
And the way you think about your investments,
the way you design your portfolio is gonna
help to mitigate that risk.
Maybe we talk about social security decisions a
lot.
Sometimes that's maybe factors into helping to mitigate
the inflationary concerns.
All right, what were some of the other
(23:54):
of the five big ones that they talked
about There were two others in this article.
One was taxes.
And I do see that with people who
don't appropriately calculate the taxes in retirement or
they just, you know, it's not they forget.
They just don't appreciate that when they were
working, they had taxes withheld.
(24:14):
Yeah.
And, you know, we see clients and, you
know, here's stories of like people taking withdrawals
from their retirement savings or taxable brokerage account.
And, you know, we talked to them at
that time, like, do you need to withhold
taxes?
And so many people who get in trouble,
don't contemplate and say, no, I'll deal with
(24:34):
that later.
Or they put it off, right?
Yeah.
And they say, you know, or I'm gonna
put that money back.
So I don't need it, right?
Yeah.
Things like that.
And then it kind of snowballs where they
use that money and then don't have liquid
money.
Yeah.
So you need to pay.
And they're like, I had such a big
tax bill.
Why?
You know, and then they have to take
(24:57):
more money out of their retirement plan again
for the next year.
So they got a big tax bill again,
you know, that kind of thing.
You can see these kinds of things over
and over again happening, right?
I had one neighbor probably two weeks ago
that was complaining about his CPA and said
that, you know, he made all the estimated
taxes that he told them to make.
So I was drilling down with them a
(25:19):
little bit.
And to this example, exactly, he said, well,
I guess I took an extra withdrawal last
year and didn't withhold any money on it.
Darn CPA.
Did you call your CPA and tell him
this?
Yeah.
He was basing it upon, you know, the
previous year.
So, you know, it's just pay attention to
it, right?
(25:39):
You pay quarterlies probably for a reason, but
do a calculation when you're paying that quarterly
and say, am I on track?
Yeah.
Or sit down with your advisor and say,
you know, I feel like I've had a
lot of capital gains this year or, you
know, I took that extra withdrawal.
Do you think I need to increase my
quarterly?
Talk to somebody about it, do a calculation
(26:01):
as you're doing the quarterly so you don't
get surprised by a big tax bill that
you can't pay.
Yeah, good point.
I would say we oftentimes talk in our
financial planning process about strategy around tax diversification
and the tax prioritization, where to draw from,
and that can have virtue, but it can
(26:23):
be challenging too.
And there's times when people don't want to
draw down their taxable accounts first fully, you
know.
We often try to think in terms of
sequence, try to use the taxable account money
first, IRA type money second, and then the
Roth money last, thinking that's going to grow
(26:43):
the most and we want it to tax
-free, you know, maximum growth potential.
But sometimes we got to revisit that because,
oh, our tax bracket went down.
Maybe we want to prioritize paying some taxes
sooner, whether that means to use that money
for withdrawal or do a conversion or whatever
it might be.
But paying attention to these tax considerations is
(27:08):
a real planning opportunity.
And sometimes it's, well, let's face it for
all of us, it's frustrating.
Nobody likes taxes, right?
Well, that's all the more reason to do
it though.
You know, you mentioned that kind of general
rule that you hear people say, taxable first,
IRAs, Roth.
But that's not, it's a general rule, fine,
but it's not the right rule or the
(27:30):
- In all circumstances, yeah.
It may be right for you one year,
but the next year maybe you should have
a whole different strategy because of your current
tax situation.
So it's where these general rules kind of
- Yeah.
So it goes back to making sure you
have the right financial planning guidance in this
process.
A good tax advisor, that CPA that someone
(27:51):
was complaining about, right?
But, you know, you got to keep them
in the loop, keep them involved, get good
guidance in the process between your financial advisor,
your tax advisor and so forth, the state
planning and all the rest of it and
the whole team of people you deal with.
So that was, yeah, go ahead.
Speaking of team, the last stealth- Yes.
(28:13):
Item is family.
We've talked about this one before, the unexpected
expense that inevitably hits a lot of families
with expense and unexpectedly.
What are common circumstances that lead to this?
(28:34):
Well, so it could be a positive that
you want to be generous, or it could
be, I hate to use the word negative,
but it could be a challenge.
So it could, on a positive side, you
could have this inspiration to help someone go
to college or someone buy their first home
or someone get married, you know, a nice
wedding or someone, whatever.
(28:55):
A gifting strategy that you want to be
gifting to them routinely.
Right.
But you could do too much.
You could do too much.
So you don't want to give away all
your resources before you're done needing them.
Yeah.
There's also a circumstance where family members have
unexpected divorce or health issues or whatever it
(29:18):
may be.
There can be these things of that sort.
And parents so frequently want, we've talked about
this many times, but they want to help.
They care about family first, right?
We all care about our family.
Of course.
However, there are times when sometimes that can
be abused, or you have to give thought
(29:39):
to, am I able to do this?
So, you know, I'd like to help, but
am I able to do it in a
way that doesn't put my own financial security
in jeopardy?
Right.
And sometimes you have to show restraint or
you risk your own financial security in the
process.
(29:59):
Yep.
And be careful, even if you, make sure
that people understand what you're offering to do.
Never say I'll pay for your wedding.
Yeah.
Because your wedding could be- What's that
mean?
That could be open-ended, yeah.
It could be $5,000 or $50,000.
Make sure you're- Gotta be specific, be
(30:22):
precise.
If you're being generous or if you're helping
out a loved one who maybe has a
job loss or a divorce or whatever the
situation, talk to your spouse if you have
one, talk to your financial planner and come
up with a figure or a way to
help somebody and articulate it with specificity that
we're helping you for two months.
(30:42):
You know, we can help you for two
months.
That's what we can afford or we can
contribute $5,000 to the wedding or whatever
it is.
And that way the generosity is understood and
appreciated.
And the person receiving it didn't hire a
12 piece band for the wedding.
Yeah.
It doesn't think that mean they have a
year off and they can just go the
(31:04):
slow path of getting that next job.
So it applies- No, that's a great
point.
And then similarly, like you, if you are
saying, well, maybe I'll help them.
I was meeting with people recently in various
circumstances.
They bought a house that they were now
having a family member reside in, a condo
(31:24):
house.
I forget what it was, but the idea.
And so, but I'm going to charge you
rent or that you maybe, if you take
on the mortgage of their place that you
have a contract or, you need to have,
(31:47):
I mean, let's face it.
It's very hard to, you're going to go,
collect on that and- Foreclose.
Foreclose on someone.
You know, so you really have to give
detailed thought, but when possible, put it in
some like formalized terms so that everybody's on
(32:09):
the same page.
This is what we're agreeing to.
And that having that formality about it makes
it less of a, well, you know, mom
can afford that or dad can afford that.
You know, they can, they won't mind.
A lot of times parents don't tell what
they can and can't afford.
And it's just assumed that their resources are
(32:30):
oftentimes greater than they may even be.
So, yeah.
So be specific and, you know, document it.
And I think that's great advice.
And that way the recipient is appreciative of
what you're doing and they understand it.
And there's no hard feelings later.
Yeah, and to, I think we've had this
theme throughout.
Work with your financial planner to evaluate what
(32:52):
can you really do that you can afford?
Or if it's gonna be challenging, how do
you navigate?
What do I need to do to be
able to do what I want to help?
It may mean some changes need to occur,
you know?
And so you can evaluate what's gonna be
the way that gets you to the end
(33:14):
result that you most value and want, you
know?
Super important.
Because when you have that financial plan in
place, then you can go to the advisor
and say, I'm thinking of doing this.
Does it affect my longevity, my plan?
How does this work?
And then you get, you know, kind of
relief that it doesn't, or you get like
a point of caution to say, all right,
maybe I should do something else as you
(33:36):
indicated.
And sometimes too, you can have the benefit
of saying, well, I wanted to, but my
financial advisor.
Yeah, blame us, it's fine.
You know, if it helps, if you have
that kind of need for a little buffer,
you know, you can be like, oh, I
really was hoping to do more, but my
financial advisor tells me, you know, that kind
(33:57):
of thing.
Nothing wrong with that.
Sometimes it's helpful to have that third party
in the mix in that role.
Absolutely.
But it's ultimately, in reality, money is yours.
These decisions are yours.
Sure.
We're here to counsel and guide, but you
know, it's ultimately up to you how you
handle these issues, but we can try to
(34:19):
give you guidance and help in the process.
So I guess that's a good place for
us to wind down, Jeff.
If there's anything that you need listeners as
you run into your personal challenges of these
stealthy issues, maybe it's a good time to
update your financial plan.
Make sure you're addressing all of these issues
(34:41):
and have them well thought out.
We can be a resource in the process.
Don't hesitate to reach out.
Until next time, everybody keeps striving for something
more.
Thank you for listening to Something More with
Chris Boyd.
Call us for help, whether it's for financial
planning or portfolio management, insurance concerns, or those
quality of life issues that make the money
(35:02):
matters matter.
Whatever's on your mind, visit us at somethingmorewithchrisboyd
.com or call us toll-free at 866
-771-8901 or send us your questions to
amr-info at wealthenhancement.com You're listening to
Something More with Chris Boyd Financial Talk Show.
(35:23):
Wealth Enhancement Advisory Services and Jay Christopher Boyd
provide investment advice on an individual basis to
clients only.
Proper advice depends on a complete analysis of
all facts and circumstances.
The information given on this program is general
financial comments and cannot be relied upon as
pertaining to your specific situation.
Wealth Enhancement Group cannot guarantee that using the
information from this show will generate profits or
ensure freedom from loss.
Listeners should consult their own financial advisors or
(35:45):
conduct their own due diligence before making any
financial decisions.
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