April 17, 2025 • 24 mins
Market volatility in 2025 doesn't have to derail retirement plans if you've properly structured your income sources and diversified your investments. Proper retirement planning involves creating stable income buckets that aren't totally dependent on market performance, allowing retirees to weather economic storms with confidence.
• Sequence of returns risk can pose a significant danger when withdrawing from declining investments
• Traditional retirement income approaches like dividend stocks or bonds may only yield 2-4% and can lack stability
• Professional retirement planning should involve creating guaranteed income streams of 5-6% regardless of market conditions
• Having income buckets prepared before retirement can eliminate the stress of watching markets daily
• Catch-up contributions allow those over 50 to save up to $31,000 in 401(k)s and $8,000 in IRAs annually
• Working slightly longer or part-time can significantly improve retirement security
• Review investment fees, insurance policies, and subscriptions to potentially uncover hidden savings opportunities
• Emotional preparation for retirement can be as important as financial readiness
• Diversification in retirement means more than just different market sectors—it includes stable income sources
Schedule a complimentary consultation to receive personalized retirement planning guidance at masterplanretire.com or call 770-980-9262.
Have a topic or question you'd like Mark and Evan to address in a future episode? Email us at info@masterplanretire.com or call 770-980-9262.
https://masterplanretire.com/
Catch all episodes of our podcast at https://www.masterplanyourretirement.com/resources/episodes
Listen to Mark Fricks on Saturdays at 8:30 a.m. EST on AM920 WGKA and 12:00 p.m. on XTRA 106.3FM WFOM.
Sign up for one of our upcoming events at https://www.masterplanyourretirement.com/events
Purchase Mark's Book, The Road Less Traveled: Turning Your Retirement Worries Into an Excursion of a Lifetime on Amazon.com https://a.co/d/4fx94Al
Advisory services offered through MasterPlan Retirement Consultants, Inc., a Registered Investment Advisor in the state of Georgia. Insurance, tax and commodities services offered through Fricks and Associates, Inc. dba MasterPlan Retirement Consultants. The aforementioned are affiliated companies.
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Evan (00:06):
Is 2025 still your year to retire?
Hey folks, welcome back andthank you for joining us.
Welcome to Retirement Roadmapwith MasterPlan Retirement
Consultants.
My name is Evan and with me, asalways, retirement planner Mark
Fricks.
So, during this episode we'llconsider if those who wanted to
retire in 2025 may need toreconsider, and we'll also touch
(00:29):
on how those running behind onretirement savings can still
catch up.
Mark, we've had a prettyexciting year four months into
2025.
Mark (00:37):
Yeah not too many phone calls, but a few here and there,
right, but mostly just watchingthe markets and how quickly
they can turn on one or twowords.
Sure, absolutely, which hasalways been true, by the way,
it's worse now because of socialmedia and so many talking head
shows out there.
It is a little bit worse, butthe more we look at the history-
(00:58):
I found a great article theother day about the history and
how every time we have acorrection that's motivated by
emotion, there's a recovery.
You know pretty quickly.
Don't leave the market.
We're going to talk about allthat today, of course, but just
don't let emotions, you know,run your portfolio.
Evan (01:16):
Well, 2025 feels shaky for retirees.
I mean, they can't help butfeel it.
With markets down, inflationstill lurking, 401k is taking a
hit.
It's no surprise that many aresecond guessing their retirement
plans.
Mark (01:27):
Well, it's not a great time to start taking money out
of an account, a retirementaccount, when it's down 10, 15,
20%, for sure, and so many timeswhen people retire, that's the
first thing they start doing issupplementing their income
retirement income with one oftheir stock market accounts,
which is not how we do it.
So we have different rulesabout that, but that's what a
(01:48):
lot of people do.
It's the old-fashioned way.
I'll just turn on my IRA orwhatever and yeah, that's
dangerous and imagine retiringin 2007.
In 2008, 2009, 56% drop.
You'd go back to work.
You'd almost have to.
So I don't think that's wherewe're headed today, for sure,
but certainly this is a year ofunrest until they work out all
(02:10):
the tariffs and things like that.
So, the simple answer is,unless you've been preparing for
retirement for a few years andhave said it with a true
retirement planner, you may wantto reconsider pushing it down a
little bit.
Evan (02:22):
Yeah, absolutely.
Well, you know, just like yousaid, it all depends on your
setup.
Every person is different.
Whether 2025 is a bad year toretire, it comes down to how
much you've saved, how you planon withdrawing your money, what
lifestyle you plan to live.
Every situation is different,just like all of retirement
planning.
Mark (02:40):
Absolutely.
And again, hopefully those thatare listening are working with
someone and not just aninvestment broker or something
like that, or an insurance agent, somebody that really looks at
all eight to 15 areas ofretirement to make sure it all
comes together.
One of those most importantareas is income planning, and we
don't use a moderate oraggressive stock market account
(03:03):
to produce income.
We use tools that are stable,that have guaranteed principle,
and you don't have to worryabout the market.
It's going to produce sameincome regardless of what the
market does.
People that get started with usone year, three years, five
years away from retirement.
We just progressively move theminto that position and by the
(03:24):
time they hit retirement, it'sjust a, it's a set it, it's turn
it on, let's get going.
Evan (03:28):
Yeah, that's right and you know you got to be aware of the
sequence of returns risk.
I mean, the problem is when youdon't have a plan, when you're
not planning for your incomebuckets or accounts and you're
just pulling from marketaccounts.
You are at the mercy of thestock market and the economy.
What's going on right there.
You're not planning and takingcontrol of your own retirement.
Sequence of returns risk,pulling from your investments
(03:51):
during a market dip, that canlock in your losses early on,
which is bad news for along-term income.
Mark (03:56):
Well, and the old way of doing it was either, again,
taking it out of the stockmarket and maybe more
conservative.
So I've gone heavy bonds.
Well, bonds, historically overthe last 30 years, are barely
producing two to 4%.
That's inflation, barely youknow.
Or maybe you know the oldfashioned way of hey, I'm going
to buy a bunch of dividendstocks, and if you don't know
what a dividend is, it's aprofit shared by the company
(04:18):
that you own stock in.
So for every stock you own,maybe you get $10 or whatever it
is, and that's great in goodyears.
But as the economy and themarkets, when they hit those
downtimes, dividends drop too,and so again, that's not a
guaranteed income stream.
And again, our best dividendportfolio is producing about
3.5%.
Again, that to me is not enoughincome.
(04:39):
We like these tools thatproduce 5% to 6% income and it's
guaranteed regardless of themarket.
So again, it's the sequence ofreturns.
I'm glad you mentioned that.
That's a real risk because weknow over time the market goes
up, but it goes up in thisfashion, and so if you're taking
money out every month or everyquarter, are you hitting a dip
or a height or what?
(04:59):
And we don't know.
And that's the unknown, whichis why we want that stable
bucket.
And again, you need to beprepared now and not wait till,
hey, I'm retiring next week.
It's never too late, so don'tnot call us but a true
retirement planner that can haveyou know when do you turn on
Social Security.
Again, how do you develop thatincome plan?
(05:20):
And then all the other piecesthat fit together with that tax
strategy, long-term carestrategies, healthcare
strategies, medicare consultingI mean, I can go on again for
another eight or 10 items, butthey all matter.
But really, as I think we'vesaid before, I think the most
important thing is a solidincome plan, right?
Evan (05:39):
Right.
And another note don't panicand go all cash.
Jumping ship when the market isdown means missing the recovery
.
Now that doesn't mean you can'thedge with some cash.
Some of our more aggressiveportfolios actually have a
portion in cash right now.
However, if you're all in cashand you lock in those losses,
not only are you locking in yourloss, but you're missing out on
(05:59):
the recovery.
History shows those who staythe course often come out ahead.
In fact, one of my clients, he,in 2008, that market drop
scared him and he moved all tocash in his 401k and you know,
with money market funds.
So he was.
He was earning less thaninflation.
He was earning something.
He wasn't keeping up withinflation.
I didn't meet him till 13, 14years years later.
(06:23):
Actually longer, 15 years laterand he still had a healthy 401k
.
He had over half a million inthere.
But just thinking about howmuch he missed out on all those
years of market returns.
Mark (06:34):
I'm thinking over 500% Probably.
I think it's the number that'spopping in my head that if he
had just stayed, even thoughthere was a drop, he didn't need
the money, he wasn't retired.
Leave it alone.
Again, it depends on your agedepends on a lot of factors.
These are not blanketrecommendations.
Here's the other thing.
You can't blame someone forthat either, because we were all
given 401k s back in the late70s, early 80s.
(06:57):
That's when they rolled themout.
All of a sudden, we moved frompensions to 401k s.
Did they give us courses?
No, training no.
Evan (07:03):
How to handle that, did they tell us?
Okay, there are two bigemotions that are going to
control how you respond to your401k.
That's fear and greed.
You got to tamper both of those.
They both work against you.
Yeah, you really should bemanaging your co-workers 401k
and he can manage yours, so youcan take a step back or just do
the opposite.
Don't actually do that, folks.
Mark (07:30):
The comedy episode.
Just do the opposite, becauseeverything I've ever done is
wrong.
Let me do the opposite.
Everything I do will be rightnow.
But really, I mean that's whatWarren Buffett says.
The world's greatest investor iswhen do you buy?
When there's blood in the water, the worse things get, the more
you should buy.
And now, um, you know he wentto cash recently.
I bet you right now he'sgetting back into the market and
buying some stuff.
Um, gosh, I mean, so manystories I could tell we won't,
(07:52):
we don't have time.
But again, that's why, uh, weuse professional money managers
that do it for our clients, doit for us, because we don't want
to be involved in the emotionalaspect.
We want those computeralgorithms that are reading
what's happening, trying to lookahead into the markets and
making the right moves asquickly as possible.
The portfolio you mentioned,that's pretty aggressive.
(08:14):
They're 25% in cash now, butthey didn't move 25% in cash
three weeks after the drops.
They moved very quickly, almostimmediately, and they did not
catch a lot of those drops thatoccurred.
So it's not about and that'sthe problem with the 401k you
can only make a couple of movesa month, and so you may have to
wait another two weeks beforeyou make a move.
That might be good.
It keeps you from making a movebecause all of a sudden, the
(08:37):
next day it's up again.
Evan (08:38):
Well, we already saw some recovery recently after the
extension of the 90 dayextension for the tariffs.
Mark (08:44):
I think the last stat I saw and I may be off on this a
little bit, but I think 90% ofour gains in a year come in a
10-day period.
I think that's correct and I'mnot saying 10 days in a row,
Maybe one day in February, oneday in April, whatever.
So if you're out of the marketone of those 10 days, you've
(09:04):
missed a big percentage of thegain for that market.
So again, I'm not talking tosomebody that's 62 retiring next
year.
That's a different setup, but Iam talking to folks that are
forties and fifties.
And then as we, like I saidearlier, as we start getting
five years away, we startchanging some three years away,
start changing some more oneyear away.
(09:25):
Big changes, retired boom,we're set up.
Evan (09:28):
It's all it's ready to go.
Yeah, so not really speaking toour clients right now.
If you've not spoken to aretirement planner, you've got
to plan for flexibility, and I'mgoing to be careful about
making blanket statements,excuse me, because, again, we
say this over and over.
These are not one-size-fit-allanswers, but you know, if you
have not really planned forretirement, if you can cover two
(09:50):
to three years of expenseswithout touching your
investments, hey, you're on asolid spot.
You don't have anything toworry about.
Otherwise, it might be wise towait a little longer and ride
out the storm.
If you were thinking of 2025 asa retirement year, some real
key factors to consider.
One where is your income comingfrom?
Do you have an income plan?
Mark (10:10):
As we've already mentioned , and that's how important it is
.
We will talk about that inevery other show, every other
episode.
We'll talk about that because,again, knowing where your income
is coming from for the next 30years by the way, it's not set
in stone, it's very changeable,very flexible, but being able to
look ahead and say no.
I talked to a guy one time andhe did not become a client, he
(10:31):
was very much a do-it-yourselferand he basically had already
retired.
He'd been retired about a yearand he admitted to me that he
pretty much wakes up almostevery business morning in
retirement looking at what themarket's doing, because he's
relying on the market for hisincome.
Evan (10:50):
What kind of retirement is that 25, 30 years of doing that
in retirement is notcomfortable.
Mark (10:54):
I don't know.
They go back to work.
Evan (10:55):
Yeah, it's stressful, wow.
So 2025 could be a good year toretire if you've been saving
consistently, managing debt,keeping your investments
diversified, having those incomebuckets prepared.
Inflation right now isrelatively tame.
It doesn't always feel like itwhen you're buying eggs, but
inflation is relatively tame andmarket dips don't have to
(11:15):
derail your plans if you'reprepared.
In fact, most of our clientshave their income buckets
prepared way before theirretirement.
In fact, yesterday we met witha couple who we've been with us
for a long time.
They retired earlier this year.
Mark (11:30):
Happy loving life.
They could not quit hugging us.
They could not quit thanking us.
Uh, if it had been for guys, wewould not be able to retire at
this point.
No stress, I mean, just it wasbeautiful.
I've known them for probably 40years through church and
everything else, and we've beenworking with them I think we
figured up 17 years but just itwas so good, it was such a great
(11:54):
ending to yesterday to to meetwith them and they were making
some final changes on theirtrust as they, as they enter
retirement.
But just it was so good.
It's so rewarding, yeah, yeahwell and.
Evan (12:05):
But they didn't retire in 2025 on a whim.
You know they had a plan inplace for it.
Like Mark said, we've knownthem for 17 years, so we started
working with them on their plana long time ago.
That's so much time to prepareand uh for accounts and build
towards your goal in retirementbecause they know where their
money's coming.
They know where their income'scoming from this year and it's
(12:27):
not their market, and the moneythey do have in the market.
Mark (12:29):
They don't need it, right.
So.
But one of their accounts wasup yeah, a good, a good bit and
they needed to buy a car withinthe next two months.
So we left alone most of themarket accounts, but we went to
their precious metals account,right, which was up
significantly and and was ableto buy almost a brand new car,
uh, with what they had grown by.
(12:50):
So that was really cool too.
We always want a place we can goto that's going to be up.
I've never seen a market andhistorically I think this is
true is there's never been amarket where there's not
something that's up.
So we want a little bit ofeverything so that if we need
money, we can go to thatparticular bucket that is up and
grab it.
(13:10):
Otherwise, the income is comingfrom the stable bucket and it's
never going to be down.
So again, diversification whenyou're 25 or 30 is hey, have
some large growth, small growth,small cap, these types of
things.
But diversification inretirement is much more involved
, and then you even get into taxdiversification.
(13:31):
So, by the way, I want to makea quick, I guess, announcement
here, or commercial break,whatever.
Make sure you visit our website.
It is a treasure trove ofresources for retirement.
Bookmark it.
It's masterplanretirecom.
Lots of checklists onretirement.
(13:51):
Every episode we've done overthe last couple of years is on
there via podcast, via YouTube.
Of course, our radio show aswell.
It's every subject in the worldas it pertains to retirement.
But also there's a littlebutton on there.
It says schedule a meeting.
This is a complimentary meetingto figure out where you're at,
(14:11):
talk about your dreams, yourgoals, your fears.
What does your retirement lifelook like?
We talk about that for severalminutes and really want to
explore what your ideas are.
Maybe you've talked about itbefore and you and your spouse
are looking at each other likeyou know, I don't know.
Do we want a second home?
Do we want to move?
Well, whatever it might be.
But, most importantly, we willthen run you a series of reports
(14:32):
that will tell you again whoyou truly are when it comes to
numbers, and I think it's a bigrelief.
It's like going to a doctor andyou know, yeah, they may find
something wrong, but you can'tfix it till you find out what's
wrong.
So that's what thesecomplimentary meetings will do.
I hope you'll sign up for it,evan, and I will meet with you
one or the other or both,depending on the schedule.
(14:54):
And again, it's just a goodchat and then some reports that
will help you out.
By the way, the phone number isalso 770-980-9262.
So if you like to talk to alive person, give that a try.
770-980-9262.
Evan (15:12):
Yeah.
So if you're thinking ofretiring in 2025 or even
subsequent years, do a pulsecheck on your retirement before
calling it quits.
Ask yourself some key questionsAre you maxing out your
retirement accounts?
Is your living situationaffordable?
Can you emotionally handlemarket swings without a paycheck
?
Are you completely reliant onmarket swings on whether or not
you're able to retire?
(15:32):
If you're behind on savingfolks, it's not too late.
You can use catch-upcontributions up to $31,000 or
$34,750 for ages 60 to 63.
But if you're over 50, up to$31,000 in a 401k in 2025.
Even small increases incontributions, especially with
employer matches, can lead tobig gains over time.
Mark (15:54):
And even if you're maxing out your 401k or 403b or thrift
savings plan, you can still do apersonal IRA or Roth individual
like through a company, like us, or something up to $8,000 if
you're 50 and older.
So if you really are makinggood money maybe the kids are
through college you've got thatextra money that's come in.
That's $38,000 to $42,000 moreyou could be saving right now,
(16:18):
plus whatever the match is.
Evan (16:20):
So that's some heavy-duty saving right there and maybe you
do need to work a little bitlonger.
That's the case for some people.
Sometimes we talk to someonewho just cannot bear to think
about going into work one moreday and we have to work with
them and figure that out.
But maybe working a little bitlonger and automating your
savings is the way you need togo.
A couple extra years on the jobcan really make a difference,
(16:42):
building your nest egg andlowering debt, or maybe cutting
back.
Mark (16:46):
Or maybe even cutting back for a while.
A lot of companies will letsomebody work less hours and
keep most of your benefits orjust walk away because you can't
stand the company and go find apart-time job.
Evan (16:56):
We just had a big episode on that the power of part-time
work, not only financially,because it helps supplement
retirement income, butemotionally, and it's hard to
make that huge shift in yourlifestyle, sometimes to just
completely cut off what is, formany of us, our largest social
circle through employment.
Mark (17:13):
Well, Evan and I, we love what we do and I know I mean
I've been doing this a long time.
If I just woke up one morningsaid I'm done, I really don't
know what I'd do in my life.
I mean, I love teaching, I lovedoing the episodes, I love
sitting in front of a client anddesigning a retirement roadmap
that fits their needs exactly.
It's just so many things I lovedoing.
(17:34):
Not crazy about the paperwork,but everything else so.
But we got great people herethat do a lot of the paperwork.
That's the good news.
But yeah, so I don't see myselfnow.
Will I slow down eventually?
Probably because I'll have toright's.
It's hard to imagine now.
Other people out there likethey're like, hey, when I hit 60
(17:55):
, I'm done, I am done with this,and that's fine too.
Everybody's different.
But we have other clients andwe've talked about this or
they're afraid to retire,they're afraid their health's
going to deteriorate.
Yeah, which is why we talkabout what are you gonna be
doing?
Let's talk about us.
Come, come up something to do.
And again, we had a wholeepisode a couple weeks ago about
that.
So you going to be doing?
Let's talk about it, let's comeup with something to do Again.
We had a whole episode a coupleof weeks ago about that, so you
might want to go back andlisten to that one if you missed
it.
Evan (18:15):
Yeah.
So retirement is not a one sizefits all.
So whether you're ready now orthinking of punting to next year
, it's more of the numbers.
Yeah, the finances areincredibly important for
longevity, but it's aboutconfidence as well.
Emotional confidence,flexibility, creating a next
chapter you're genuinely excitedto live, because if you're
afraid to retire, that's not theretirement that I want to enter
(18:37):
into.
I want to make sure I'mconfident and I have a plan.
Mark (18:39):
Yeah, that's stress free.
That's one of the reasons why alot of folks want to retire is
stress.
Stress at work, and so you knowit helps us live longer without
the stress.
So having a stress-freeretirement will extend your life
span, I believe for sure.
So that is important.
Evan (18:57):
A couple other things that you could do leading up to
retirement.
You know you did mention the Bword earlier budget to help
boost savings.
Hopefully we'll blip that out.
Yeah, we'll blip that out Againeveryone's situation is
different what they're able todo.
But 50-30-20 rule is a commonrule to use, Basically 50% for
(19:17):
needs, 30% for wants, 20% forsavings and debt.
If you're able to start there,that's a great place to start
and then you can adjust as youmove along, help you catch up a
little bit.
Watch out for sneaky investmentsfees.
This is one we don't talk abouttoo often, but management fees
might sound small but they coulddelay your retirement,
especially if all of your moneyis in a 401k or something else
(19:38):
like that.
I bet you most of thatinvestment is in mutual funds.
You say, well, my 401k has gota pretty low fee.
Yeah, the 401k itself mighthave a low fee, but those mutual
funds within your 401k eachhave their own fee associated
with them as well, and youprobably don't know what they
are unless you read theprospectus for each individual
mutual fund, and I don't knowtoo many people who have ever
(19:59):
done that.
Now not many, and those feesrun from a half percent up to
over 2% per fund.
Mark (20:06):
And so there was a study done by the government a few
years ago and they said 401K,403Bs were the most expensive
investment vehicles.
So that's why we're very quickto take a look at that under a
fiduciary responsibility and seeabout rolling that out.
A lot of people may or may notknow this, but when you turn 59
1⁄2, even if you still work forthat company, you can roll out a
(20:29):
portion or all of that 401kinto an individual investment
account.
Make sure you use one underfiduciary where there's no
commissions built in, no hiddenfees, just that one management
fee.
That's right on the top.
You see it when you open yourstatement, so be careful that it
eat it away, like you said.
Evan (20:44):
And if this is a season that you feel like you need to
tighten your belt a little bit,you could hunt for hidden
savings.
Review insurance policies,phone and cable plans, unused
subscriptions.
I know most of us are guilty ofthat.
You might find money hiding inplain sight and maybe even
cancel that fifth streamingservice you forgot about.
Mark (21:02):
I've talked to people that have been with the same
insurance company like for carand auto for like 20 years.
You should shop that everythree years.
There's no loyalty left withinsurance companies.
You could be with them 20 years, have two accidents and you're
gone.
It doesn't matter, you've beenthere 20 years.
And so I love using independentagents because they represent
multiple companies, kind of likewe do, and so you get the very
(21:23):
best rate to develop arelationship with that agent.
They're always shopping for you.
They have your back becausethey don't work for the
insurance companies, they workfor you.
But shop it.
Don't be afraid to shop it andget the very best rate.
Combine them Like auto withhome.
You get a discount as well.
But that's just one example.
You touched on several thingsthat are important.
Evan (21:45):
Well, it's tax season.
Right now.
Put your windfalls to work.
Instead of spending your taxrefund or bonus, send it to your
IRA.
Pad your emergency fund.
Mark (21:54):
Uh future, you will thank you and be very careful about
and you mentioned this earlier,alluded to it, Evan, be careful
about putting all of your moneyin your 401k, especially if
you're under 59 and a half.
You still need that savings onthe side and that you've got to
get to that.
You can't get to your 401kwithout a penalty under 59 and a
half, so be careful.
Evan (22:14):
Uh, that's to spread out your savings.
Yeah, and we mentioned thisthroughout this entire episode,
folks, but if you have notstarted considering your own
retirement plan, start theconversation.
We are retirement planners, butthere are other retirement
planners out there.
Get help somewhere, even ifit's just a consultation.
We offer complimentaryconsultations A lot of places do
(22:35):
but you need to get at leaststart that conversation.
Get an idea of where yourfoothold is.
Like Mark mentioned earlier,with our consultations, we give
basically a 10,000 foot view ofyour retirement.
We organize your accounts.
We run a series of reportswhere.
Where are your strengths, yourweaknesses, what do you need to
look out for?
Whether it's tax strategy, bearmarkets, like we've discussed a
(22:56):
lot today.
When are you able to retire,social security reports.
All of this has to worktogether.
Mark mentioned a little bitabout our clients who came in
earlier to tighten up theirtrust documents.
Is your estate plan in place?
Folks, all of this has to worktogether.
It's something we do.
We're happy to work with you.
Come on in- office, we'll buy acup of coffee or we could do
(23:18):
something via zoom as well, butif we can help you, folks, just
come have a conversation with uswe h ave people that listen to
these episodes from across thecountry.
Mark (23:28):
We teach classes across the country, so this is not just
about Metro Atlanta.
We work with folks in multiple,multiple states.
I think we're up to about 25states now that we work with
folks in, so don't worry aboutwhere you're at, you know.
Give us a call Again.
We could do a Zoom.
I can do a phone call with you.
Whatever works for you to takeadvantage of that complimentary
(23:50):
consultation.
So visit masterplanretirecom,get that scheduled, and I think
that pretty much wraps us up fortoday.
Hope everybody has a great weekand until we see each other
again, plan well and prosper.
This was Retirement RoadmapRadio with Mark Fricks of Master
Plan Retirement Consultants.
To schedule a complimentaryconsultation, go to
(24:13):
masterplanretirecom or call770-980-9262.
Thanks for listening andremember plan well and prosper.
Speaker 3 (24:23):
All matters discussed during this show are for
informational purposes only.
Each individual situation mayvary and the opinions expressed
here may not apply to everyone.
Materials presented arebelieved to be from reliable
sources and no representationscan.
We'll see you next time.
Is 2025 still your year to retire?
Hey folks, welcome back andthank you for joining us.
Welcome to Retirement Roadmapwith MasterPlan Retirement
Consultants.
My name is Evan and with me, asalways, retirement planner Mark
Fricks.
So, during this episode we'llconsider if those who wanted to
retire in 2025 may need toreconsider, and we'll also touch
(00:29):
on how those running behind onretirement savings can still
catch up.
Mark, we've had a prettyexciting year four months into
2025.
Mark (00:37):
Yeah not too many phone calls, but a few here and there,
right, but mostly just watchingthe markets and how quickly
they can turn on one or twowords.
Sure, absolutely, which hasalways been true, by the way,
it's worse now because of socialmedia and so many talking head
shows out there.
It is a little bit worse, butthe more we look at the history-
(00:58):
I found a great article theother day about the history and
how every time we have acorrection that's motivated by
emotion, there's a recovery.
You know pretty quickly.
Don't leave the market.
We're going to talk about allthat today, of course, but just
don't let emotions, you know,run your portfolio.
Evan (01:16):
Well, 2025 feels shaky for retirees.
I mean, they can't help butfeel it.
With markets down, inflationstill lurking, 401k is taking a
hit.
It's no surprise that many aresecond guessing their retirement
plans.
Mark (01:27):
Well, it's not a great time to start taking money out
of an account, a retirementaccount, when it's down 10, 15,
20%, for sure, and so many timeswhen people retire, that's the
first thing they start doing issupplementing their income
retirement income with one oftheir stock market accounts,
which is not how we do it.
So we have different rulesabout that, but that's what a
(01:48):
lot of people do.
It's the old-fashioned way.
I'll just turn on my IRA orwhatever and yeah, that's
dangerous and imagine retiringin 2007.
In 2008, 2009, 56% drop.
You'd go back to work.
You'd almost have to.
So I don't think that's wherewe're headed today, for sure,
but certainly this is a year ofunrest until they work out all
(02:10):
the tariffs and things like that.
So, the simple answer is,unless you've been preparing for
retirement for a few years andhave said it with a true
retirement planner, you may wantto reconsider pushing it down a
little bit.
Evan (02:22):
Yeah, absolutely.
Well, you know, just like yousaid, it all depends on your
setup.
Every person is different.
Whether 2025 is a bad year toretire, it comes down to how
much you've saved, how you planon withdrawing your money, what
lifestyle you plan to live.
Every situation is different,just like all of retirement
planning.
Mark (02:40):
Absolutely.
And again, hopefully those thatare listening are working with
someone and not just aninvestment broker or something
like that, or an insurance agent, somebody that really looks at
all eight to 15 areas ofretirement to make sure it all
comes together.
One of those most importantareas is income planning, and we
don't use a moderate oraggressive stock market account
(03:03):
to produce income.
We use tools that are stable,that have guaranteed principle,
and you don't have to worryabout the market.
It's going to produce sameincome regardless of what the
market does.
People that get started with usone year, three years, five
years away from retirement.
We just progressively move theminto that position and by the
(03:24):
time they hit retirement, it'sjust a, it's a set it, it's turn
it on, let's get going.
Evan (03:28):
Yeah, that's right and you know you got to be aware of the
sequence of returns risk.
I mean, the problem is when youdon't have a plan, when you're
not planning for your incomebuckets or accounts and you're
just pulling from marketaccounts.
You are at the mercy of thestock market and the economy.
What's going on right there.
You're not planning and takingcontrol of your own retirement.
Sequence of returns risk,pulling from your investments
(03:51):
during a market dip, that canlock in your losses early on,
which is bad news for along-term income.
Mark (03:56):
Well, and the old way of doing it was either, again,
taking it out of the stockmarket and maybe more
conservative.
So I've gone heavy bonds.
Well, bonds, historically overthe last 30 years, are barely
producing two to 4%.
That's inflation, barely youknow.
Or maybe you know the oldfashioned way of hey, I'm going
to buy a bunch of dividendstocks, and if you don't know
what a dividend is, it's aprofit shared by the company
(04:18):
that you own stock in.
So for every stock you own,maybe you get $10 or whatever it
is, and that's great in goodyears.
But as the economy and themarkets, when they hit those
downtimes, dividends drop too,and so again, that's not a
guaranteed income stream.
And again, our best dividendportfolio is producing about
3.5%.
Again, that to me is not enoughincome.
(04:39):
We like these tools thatproduce 5% to 6% income and it's
guaranteed regardless of themarket.
So again, it's the sequence ofreturns.
I'm glad you mentioned that.
That's a real risk because weknow over time the market goes
up, but it goes up in thisfashion, and so if you're taking
money out every month or everyquarter, are you hitting a dip
or a height or what?
(04:59):
And we don't know.
And that's the unknown, whichis why we want that stable
bucket.
And again, you need to beprepared now and not wait till,
hey, I'm retiring next week.
It's never too late, so don'tnot call us but a true
retirement planner that can haveyou know when do you turn on
Social Security.
Again, how do you develop thatincome plan?
(05:20):
And then all the other piecesthat fit together with that tax
strategy, long-term carestrategies, healthcare
strategies, medicare consultingI mean, I can go on again for
another eight or 10 items, butthey all matter.
But really, as I think we'vesaid before, I think the most
important thing is a solidincome plan, right?
Evan (05:39):
Right.
And another note don't panicand go all cash.
Jumping ship when the market isdown means missing the recovery
.
Now that doesn't mean you can'thedge with some cash.
Some of our more aggressiveportfolios actually have a
portion in cash right now.
However, if you're all in cashand you lock in those losses,
not only are you locking in yourloss, but you're missing out on
(05:59):
the recovery.
History shows those who staythe course often come out ahead.
In fact, one of my clients, he,in 2008, that market drop
scared him and he moved all tocash in his 401k and you know,
with money market funds.
So he was.
He was earning less thaninflation.
He was earning something.
He wasn't keeping up withinflation.
I didn't meet him till 13, 14years years later.
(06:23):
Actually longer, 15 years laterand he still had a healthy 401k
.
He had over half a million inthere.
But just thinking about howmuch he missed out on all those
years of market returns.
Mark (06:34):
I'm thinking over 500% Probably.
I think it's the number that'spopping in my head that if he
had just stayed, even thoughthere was a drop, he didn't need
the money, he wasn't retired.
Leave it alone.
Again, it depends on your agedepends on a lot of factors.
These are not blanketrecommendations.
Here's the other thing.
You can't blame someone forthat either, because we were all
given 401k s back in the late70s, early 80s.
(06:57):
That's when they rolled themout.
All of a sudden, we moved frompensions to 401k s.
Did they give us courses?
No, training no.
Evan (07:03):
How to handle that, did they tell us?
Okay, there are two bigemotions that are going to
control how you respond to your401k.
That's fear and greed.
You got to tamper both of those.
They both work against you.
Yeah, you really should bemanaging your co-workers 401k
and he can manage yours, so youcan take a step back or just do
the opposite.
Don't actually do that, folks.
Mark (07:30):
The comedy episode.
Just do the opposite, becauseeverything I've ever done is
wrong.
Let me do the opposite.
Everything I do will be rightnow.
But really, I mean that's whatWarren Buffett says.
The world's greatest investor iswhen do you buy?
When there's blood in the water, the worse things get, the more
you should buy.
And now, um, you know he wentto cash recently.
I bet you right now he'sgetting back into the market and
buying some stuff.
Um, gosh, I mean, so manystories I could tell we won't,
(07:52):
we don't have time.
But again, that's why, uh, weuse professional money managers
that do it for our clients, doit for us, because we don't want
to be involved in the emotionalaspect.
We want those computeralgorithms that are reading
what's happening, trying to lookahead into the markets and
making the right moves asquickly as possible.
The portfolio you mentioned,that's pretty aggressive.
(08:14):
They're 25% in cash now, butthey didn't move 25% in cash
three weeks after the drops.
They moved very quickly, almostimmediately, and they did not
catch a lot of those drops thatoccurred.
So it's not about and that'sthe problem with the 401k you
can only make a couple of movesa month, and so you may have to
wait another two weeks beforeyou make a move.
That might be good.
It keeps you from making a movebecause all of a sudden, the
(08:37):
next day it's up again.
Evan (08:38):
Well, we already saw some recovery recently after the
extension of the 90 dayextension for the tariffs.
Mark (08:44):
I think the last stat I saw and I may be off on this a
little bit, but I think 90% ofour gains in a year come in a
10-day period.
I think that's correct and I'mnot saying 10 days in a row,
Maybe one day in February, oneday in April, whatever.
So if you're out of the marketone of those 10 days, you've
(09:04):
missed a big percentage of thegain for that market.
So again, I'm not talking tosomebody that's 62 retiring next
year.
That's a different setup, but Iam talking to folks that are
forties and fifties.
And then as we, like I saidearlier, as we start getting
five years away, we startchanging some three years away,
start changing some more oneyear away.
(09:25):
Big changes, retired boom,we're set up.
Evan (09:28):
It's all it's ready to go.
Yeah, so not really speaking toour clients right now.
If you've not spoken to aretirement planner, you've got
to plan for flexibility, and I'mgoing to be careful about
making blanket statements,excuse me, because, again, we
say this over and over.
These are not one-size-fit-allanswers, but you know, if you
have not really planned forretirement, if you can cover two
(09:50):
to three years of expenseswithout touching your
investments, hey, you're on asolid spot.
You don't have anything toworry about.
Otherwise, it might be wise towait a little longer and ride
out the storm.
If you were thinking of 2025 asa retirement year, some real
key factors to consider.
One where is your income comingfrom?
Do you have an income plan?
Mark (10:10):
As we've already mentioned , and that's how important it is
.
We will talk about that inevery other show, every other
episode.
We'll talk about that because,again, knowing where your income
is coming from for the next 30years by the way, it's not set
in stone, it's very changeable,very flexible, but being able to
look ahead and say no.
I talked to a guy one time andhe did not become a client, he
(10:31):
was very much a do-it-yourselferand he basically had already
retired.
He'd been retired about a yearand he admitted to me that he
pretty much wakes up almostevery business morning in
retirement looking at what themarket's doing, because he's
relying on the market for hisincome.
Evan (10:50):
What kind of retirement is that 25, 30 years of doing that
in retirement is notcomfortable.
Mark (10:54):
I don't know.
They go back to work.
Evan (10:55):
Yeah, it's stressful, wow.
So 2025 could be a good year toretire if you've been saving
consistently, managing debt,keeping your investments
diversified, having those incomebuckets prepared.
Inflation right now isrelatively tame.
It doesn't always feel like itwhen you're buying eggs, but
inflation is relatively tame andmarket dips don't have to
(11:15):
derail your plans if you'reprepared.
In fact, most of our clientshave their income buckets
prepared way before theirretirement.
In fact, yesterday we met witha couple who we've been with us
for a long time.
They retired earlier this year.
Mark (11:30):
Happy loving life.
They could not quit hugging us.
They could not quit thanking us.
Uh, if it had been for guys, wewould not be able to retire at
this point.
No stress, I mean, just it wasbeautiful.
I've known them for probably 40years through church and
everything else, and we've beenworking with them I think we
figured up 17 years but just itwas so good, it was such a great
(11:54):
ending to yesterday to to meetwith them and they were making
some final changes on theirtrust as they, as they enter
retirement.
But just it was so good.
It's so rewarding, yeah, yeahwell and.
Evan (12:05):
But they didn't retire in 2025 on a whim.
You know they had a plan inplace for it.
Like Mark said, we've knownthem for 17 years, so we started
working with them on their plana long time ago.
That's so much time to prepareand uh for accounts and build
towards your goal in retirementbecause they know where their
money's coming.
They know where their income'scoming from this year and it's
(12:27):
not their market, and the moneythey do have in the market.
Mark (12:29):
They don't need it, right.
So.
But one of their accounts wasup yeah, a good, a good bit and
they needed to buy a car withinthe next two months.
So we left alone most of themarket accounts, but we went to
their precious metals account,right, which was up
significantly and and was ableto buy almost a brand new car,
uh, with what they had grown by.
(12:50):
So that was really cool too.
We always want a place we can goto that's going to be up.
I've never seen a market andhistorically I think this is
true is there's never been amarket where there's not
something that's up.
So we want a little bit ofeverything so that if we need
money, we can go to thatparticular bucket that is up and
grab it.
(13:10):
Otherwise, the income is comingfrom the stable bucket and it's
never going to be down.
So again, diversification whenyou're 25 or 30 is hey, have
some large growth, small growth,small cap, these types of
things.
But diversification inretirement is much more involved
, and then you even get into taxdiversification.
(13:31):
So, by the way, I want to makea quick, I guess, announcement
here, or commercial break,whatever.
Make sure you visit our website.
It is a treasure trove ofresources for retirement.
Bookmark it.
It's masterplanretirecom.
Lots of checklists onretirement.
(13:51):
Every episode we've done overthe last couple of years is on
there via podcast, via YouTube.
Of course, our radio show aswell.
It's every subject in the worldas it pertains to retirement.
But also there's a littlebutton on there.
It says schedule a meeting.
This is a complimentary meetingto figure out where you're at,
(14:11):
talk about your dreams, yourgoals, your fears.
What does your retirement lifelook like?
We talk about that for severalminutes and really want to
explore what your ideas are.
Maybe you've talked about itbefore and you and your spouse
are looking at each other likeyou know, I don't know.
Do we want a second home?
Do we want to move?
Well, whatever it might be.
But, most importantly, we willthen run you a series of reports
(14:32):
that will tell you again whoyou truly are when it comes to
numbers, and I think it's a bigrelief.
It's like going to a doctor andyou know, yeah, they may find
something wrong, but you can'tfix it till you find out what's
wrong.
So that's what thesecomplimentary meetings will do.
I hope you'll sign up for it,evan, and I will meet with you
one or the other or both,depending on the schedule.
(14:54):
And again, it's just a goodchat and then some reports that
will help you out.
By the way, the phone number isalso 770-980-9262.
So if you like to talk to alive person, give that a try.
770-980-9262.
Evan (15:12):
Yeah.
So if you're thinking ofretiring in 2025 or even
subsequent years, do a pulsecheck on your retirement before
calling it quits.
Ask yourself some key questionsAre you maxing out your
retirement accounts?
Is your living situationaffordable?
Can you emotionally handlemarket swings without a paycheck
?
Are you completely reliant onmarket swings on whether or not
you're able to retire?
(15:32):
If you're behind on savingfolks, it's not too late.
You can use catch-upcontributions up to $31,000 or
$34,750 for ages 60 to 63.
But if you're over 50, up to$31,000 in a 401k in 2025.
Even small increases incontributions, especially with
employer matches, can lead tobig gains over time.
Mark (15:54):
And even if you're maxing out your 401k or 403b or thrift
savings plan, you can still do apersonal IRA or Roth individual
like through a company, like us, or something up to $8,000 if
you're 50 and older.
So if you really are makinggood money maybe the kids are
through college you've got thatextra money that's come in.
That's $38,000 to $42,000 moreyou could be saving right now,
(16:18):
plus whatever the match is.
Evan (16:20):
So that's some heavy-duty saving right there and maybe you
do need to work a little bitlonger.
That's the case for some people.
Sometimes we talk to someonewho just cannot bear to think
about going into work one moreday and we have to work with
them and figure that out.
But maybe working a little bitlonger and automating your
savings is the way you need togo.
A couple extra years on the jobcan really make a difference,
(16:42):
building your nest egg andlowering debt, or maybe cutting
back.
Mark (16:46):
Or maybe even cutting back for a while.
A lot of companies will letsomebody work less hours and
keep most of your benefits orjust walk away because you can't
stand the company and go find apart-time job.
Evan (16:56):
We just had a big episode on that the power of part-time
work, not only financially,because it helps supplement
retirement income, butemotionally, and it's hard to
make that huge shift in yourlifestyle, sometimes to just
completely cut off what is, formany of us, our largest social
circle through employment.
Mark (17:13):
Well, Evan and I, we love what we do and I know I mean
I've been doing this a long time.
If I just woke up one morningsaid I'm done, I really don't
know what I'd do in my life.
I mean, I love teaching, I lovedoing the episodes, I love
sitting in front of a client anddesigning a retirement roadmap
that fits their needs exactly.
It's just so many things I lovedoing.
(17:34):
Not crazy about the paperwork,but everything else so.
But we got great people herethat do a lot of the paperwork.
That's the good news.
But yeah, so I don't see myselfnow.
Will I slow down eventually?
Probably because I'll have toright's.
It's hard to imagine now.
Other people out there likethey're like, hey, when I hit 60
(17:55):
, I'm done, I am done with this,and that's fine too.
Everybody's different.
But we have other clients andwe've talked about this or
they're afraid to retire,they're afraid their health's
going to deteriorate.
Yeah, which is why we talkabout what are you gonna be
doing?
Let's talk about us.
Come, come up something to do.
And again, we had a wholeepisode a couple weeks ago about
that.
So you going to be doing?
Let's talk about it, let's comeup with something to do Again.
We had a whole episode a coupleof weeks ago about that, so you
might want to go back andlisten to that one if you missed
it.
Evan (18:15):
Yeah.
So retirement is not a one sizefits all.
So whether you're ready now orthinking of punting to next year
, it's more of the numbers.
Yeah, the finances areincredibly important for
longevity, but it's aboutconfidence as well.
Emotional confidence,flexibility, creating a next
chapter you're genuinely excitedto live, because if you're
afraid to retire, that's not theretirement that I want to enter
(18:37):
into.
I want to make sure I'mconfident and I have a plan.
Mark (18:39):
Yeah, that's stress free.
That's one of the reasons why alot of folks want to retire is
stress.
Stress at work, and so you knowit helps us live longer without
the stress.
So having a stress-freeretirement will extend your life
span, I believe for sure.
So that is important.
Evan (18:57):
A couple other things that you could do leading up to
retirement.
You know you did mention the Bword earlier budget to help
boost savings.
Hopefully we'll blip that out.
Yeah, we'll blip that out Againeveryone's situation is
different what they're able todo.
But 50-30-20 rule is a commonrule to use, Basically 50% for
(19:17):
needs, 30% for wants, 20% forsavings and debt.
If you're able to start there,that's a great place to start
and then you can adjust as youmove along, help you catch up a
little bit.
Watch out for sneaky investmentsfees.
This is one we don't talk abouttoo often, but management fees
might sound small but they coulddelay your retirement,
especially if all of your moneyis in a 401k or something else
(19:38):
like that.
I bet you most of thatinvestment is in mutual funds.
You say, well, my 401k has gota pretty low fee.
Yeah, the 401k itself mighthave a low fee, but those mutual
funds within your 401k eachhave their own fee associated
with them as well, and youprobably don't know what they
are unless you read theprospectus for each individual
mutual fund, and I don't knowtoo many people who have ever
(19:59):
done that.
Now not many, and those feesrun from a half percent up to
over 2% per fund.
Mark (20:06):
And so there was a study done by the government a few
years ago and they said 401K,403Bs were the most expensive
investment vehicles.
So that's why we're very quickto take a look at that under a
fiduciary responsibility and seeabout rolling that out.
A lot of people may or may notknow this, but when you turn 59
1⁄2, even if you still work forthat company, you can roll out a
(20:29):
portion or all of that 401kinto an individual investment
account.
Make sure you use one underfiduciary where there's no
commissions built in, no hiddenfees, just that one management
fee.
That's right on the top.
You see it when you open yourstatement, so be careful that it
eat it away, like you said.
Evan (20:44):
And if this is a season that you feel like you need to
tighten your belt a little bit,you could hunt for hidden
savings.
Review insurance policies,phone and cable plans, unused
subscriptions.
I know most of us are guilty ofthat.
You might find money hiding inplain sight and maybe even
cancel that fifth streamingservice you forgot about.
Mark (21:02):
I've talked to people that have been with the same
insurance company like for carand auto for like 20 years.
You should shop that everythree years.
There's no loyalty left withinsurance companies.
You could be with them 20 years, have two accidents and you're
gone.
It doesn't matter, you've beenthere 20 years.
And so I love using independentagents because they represent
multiple companies, kind of likewe do, and so you get the very
(21:23):
best rate to develop arelationship with that agent.
They're always shopping for you.
They have your back becausethey don't work for the
insurance companies, they workfor you.
But shop it.
Don't be afraid to shop it andget the very best rate.
Combine them Like auto withhome.
You get a discount as well.
But that's just one example.
You touched on several thingsthat are important.
Evan (21:45):
Well, it's tax season.
Right now.
Put your windfalls to work.
Instead of spending your taxrefund or bonus, send it to your
IRA.
Pad your emergency fund.
Mark (21:54):
Uh future, you will thank you and be very careful about
and you mentioned this earlier,alluded to it, Evan, be careful
about putting all of your moneyin your 401k, especially if
you're under 59 and a half.
You still need that savings onthe side and that you've got to
get to that.
You can't get to your 401kwithout a penalty under 59 and a
half, so be careful.
Evan (22:14):
Uh, that's to spread out your savings.
Yeah, and we mentioned thisthroughout this entire episode,
folks, but if you have notstarted considering your own
retirement plan, start theconversation.
We are retirement planners, butthere are other retirement
planners out there.
Get help somewhere, even ifit's just a consultation.
We offer complimentaryconsultations A lot of places do
(22:35):
but you need to get at leaststart that conversation.
Get an idea of where yourfoothold is.
Like Mark mentioned earlier,with our consultations, we give
basically a 10,000 foot view ofyour retirement.
We organize your accounts.
We run a series of reportswhere.
Where are your strengths, yourweaknesses, what do you need to
look out for?
Whether it's tax strategy, bearmarkets, like we've discussed a
(22:56):
lot today.
When are you able to retire,social security reports.
All of this has to worktogether.
Mark mentioned a little bitabout our clients who came in
earlier to tighten up theirtrust documents.
Is your estate plan in place?
Folks, all of this has to worktogether.
It's something we do.
We're happy to work with you.
Come on in- office, we'll buy acup of coffee or we could do
(23:18):
something via zoom as well, butif we can help you, folks, just
come have a conversation with uswe h ave people that listen to
these episodes from across thecountry.
Mark (23:28):
We teach classes across the country, so this is not just
about Metro Atlanta.
We work with folks in multiple,multiple states.
I think we're up to about 25states now that we work with
folks in, so don't worry aboutwhere you're at, you know.
Give us a call Again.
We could do a Zoom.
I can do a phone call with you.
Whatever works for you to takeadvantage of that complimentary
(23:50):
consultation.
So visit masterplanretirecom,get that scheduled, and I think
that pretty much wraps us up fortoday.
Hope everybody has a great weekand until we see each other
again, plan well and prosper.
This was Retirement RoadmapRadio with Mark Fricks of Master
Plan Retirement Consultants.
To schedule a complimentaryconsultation, go to
(24:13):
masterplanretirecom or call770-980-9262.
Thanks for listening andremember plan well and prosper.
Speaker 3 (24:23):
All matters discussed during this show are for
informational purposes only.
Each individual situation mayvary and the opinions expressed
here may not apply to everyone.
Materials presented arebelieved to be from reliable
sources and no representationscan.
We'll see you next time.
Popular Podcasts
Crime Junkie
Does hearing about a true crime case always leave you scouring the internet for the truth behind the story? Dive into your next mystery with Crime Junkie. Every Monday, join your host Ashley Flowers as she unravels all the details of infamous and underreported true crime cases with her best friend Brit Prawat. From cold cases to missing persons and heroes in our community who seek justice, Crime Junkie is your destination for theories and stories you won’t hear anywhere else. Whether you're a seasoned true crime enthusiast or new to the genre, you'll find yourself on the edge of your seat awaiting a new episode every Monday. If you can never get enough true crime... Congratulations, you’ve found your people. Follow to join a community of Crime Junkies! Crime Junkie is presented by audiochuck Media Company.
24/7 News: The Latest
The latest news in 4 minutes updated every hour, every day.
Stuff You Should Know
If you've ever wanted to know about champagne, satanism, the Stonewall Uprising, chaos theory, LSD, El Nino, true crime and Rosa Parks, then look no further. Josh and Chuck have you covered.