Episode Transcript
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Speaker 1 (00:06):
Tonight is inflation stock plus how much money should you
really have in the stock market? You're listening to Simply Money,
presented by all Worth Financial and Ami Wagner along with
Steve Ruby.
Speaker 2 (00:17):
Everyone hopefully has recovered from their Turkey comus in time
to start thinking once.
Speaker 1 (00:22):
Again about the markets. What's going on? How's your four
one k? And maybe because so many people did cook
and bake over the weekend, maybe the conversation was a
long line of inflation and eggs, because yes, eggs are
getting expensive once again joining us tonight, not necessarily on
the price of eggs, but yes, the impact of inflation
(00:43):
is our chief investment Officer, Andy Stout. Andy, you had
said many times over the past couple of years that
as the Federal Reserve, our niche and central Bank worked
to bring down inflation by raising interest rates, that it
could get tricky and a little sticky. And I think
that's where we've landed with inflation.
Speaker 3 (01:00):
Yeah, if you look at where inflation is right now
and how it's evolved the past few years, the easy
part of the FED job it's done now. The FED
is in that last mile and it's just like in
a marathon, which for the record. I have never run,
nor will I ever.
Speaker 2 (01:17):
Run, but you heard last mile.
Speaker 3 (01:21):
From what I've heard, that last mile is really hard.
So and that's where the FED is right now. The
last mile for this inflation battle. It's going to be
a long one. It's not as easy as getting it
down when we had that initial spike in June of
twenty two. Now we're at the point where we're seeing
(01:41):
these monthly ratings still coming in a little bit higher
than we want, and that's going to make it last
longer before we get to where the FED wanted to be.
On top of all of that, we're talking about slowing
down inflation. That doesn't mean prices revert back to where
they were, that would be def We're just talking about
slowing the growth of inflation. So if you're expecting the
(02:06):
price of eggs or whatever it is to get back
to where it was before June of twenty twenty two,
you're probably going to be waiting for a long while.
And in all honesty, you probably don't want that because
if that does happen, it's going to come along with
some other things like a pretty deep recession, a pretty
strong drop into stock market. So really you just want
(02:29):
inflation to slow down to become more manageable, because otherwise
your whole lifestyle change will or your whole lifestyle will
see a decrease for the worst.
Speaker 4 (02:39):
Well, let's be clear, inflation might be a little sticky currently,
but the economy, when we pull back the curtain a
little bit, still has firm footing. Correct.
Speaker 3 (02:49):
Yeah, we got the third and final update for GDP growth,
which is the total growth of the US economy for
the third quarter. We got that last week and it
came in at two point eight percent, which is decent,
but really kind of how we think about it, Steve is,
if growth is at two percent, we'll call that, we
(03:10):
call that trend growth. So basically what you would expect
if the economy is experiencing just normal growth and the
Federal Reserve has a neutral stance, meaning they're not being
restrictive or accommodative with interest rates. Currently they're being restrictive. Still,
we're seeing above trend growth, which is pretty impressive, and
(03:33):
that just goes to show you that the consumers are
keeping uh on their steady diet of spending. And I mean,
if you just think about it, the overall makeup of
the economy is seventy percent consumer spending, and we got
some data last week showing that personal spending is continuing.
Speaker 5 (03:55):
Uh.
Speaker 3 (03:56):
And on top of that, though, personal incomes also saw
a pretty good increase, and that's a positive because what
that means is that savings rate has increased from four
point one to four point four percent, and that means
that the consumers have a longer runway to keep spending
to keep this economy chugging along. So we're seeing some
(04:16):
definite progression for the overall economy and we're not seeing
much risk in the near term in terms of economic downside.
Speaker 1 (04:26):
You just answered all my questions. I was just going
to say, Andy that you have a recession scorecard, which
is looking at what fourteen leading economic indicators to say, hey,
here's what we think the economy is going moving forward.
Speaker 2 (04:38):
What does that tell you?
Speaker 1 (04:39):
And then also I'm just wondering what your your comment
is on the resiliency of the consumer, because you know,
we look at so many headlines and doing the show,
and there have been so many people over the course
of the past year making all kinds of terrible predictions
about where the economy is heading, where the stock market
is heading.
Speaker 2 (04:57):
Yet it doesn't seem to bear that out.
Speaker 3 (05:01):
Yeah, and a lot of that is on the consumer side,
or we've been influenced heavily by what the government did
post COVID For obviously, they are trying to keep the
economy afloat when the whole economy shut down, not just
here in the US but globally, and what happened was
the flood of money that entered the economic system has
(05:27):
really it's well, first of all, it's burred inflation, but
it's also made up more challenging to have a deeper
understanding of different indicators because you're being influenced by this
massive money supply that's out there, and that's just made
the overall analysis more challenging. On top of that, another
thing that's made things more challenging is constantly data constantly
(05:51):
being revised. For instance, if we went back about three
months ago, the government had said the savings rate was
two point eight percent, which is very low, and that
had me worried that, Okay, you know, stuff is about
to get, you know, really bad. However, the next month
they revised it up from two point eight to four
point nine.
Speaker 2 (06:12):
I'm gonna say, I've never heard you use the word worried.
Speaker 3 (06:15):
Before well, I mean aside from you know, talking about
you know, my kids, and you know the worries they
give me. Sure, you're right, But the thing is, the
data said one thing, and then all of a sudden
the government changed the data and that's completely changed the picture.
And then where we look at where the data is
(06:36):
right now, it certainly suggests that these leading economic indicators,
which are data that moves before the broad economy, you
got to take with them a little less, uh, you know,
with the less of a grain of salt, because what's
going on is there being the water is being muddied
by constant revisions, by the influx of money from the government.
Speaker 4 (06:57):
Uh.
Speaker 3 (06:57):
But when we take a step back and we look
at the big picture, things are okay. The world isn't
coming to an end. The economy's on decent footing. Inflation
is still higher than where we want it to be,
but that should come down. But I don't expect it
to come down anytime soon. Maybe second quarter of next year,
maybe the third quarter. Before we see any real progress.
I kind of think we're going to kind of be
stuck in this two and a half percent and inflation
(07:21):
ran on year over year basis for some time, and
that's going to keep the Fed slow and cautious when
it comes to interest rate cuts.
Speaker 4 (07:30):
Yeah, I want to hone in on that a little
bit because we have some important updates coming out this
week that obviously could impact the Fed's next decision. So
let's let's chat about that.
Speaker 3 (07:39):
Yeah, probably the biggest one is going to be the
monthly jobs report. So when we get that on Friday,
we're going to see what the number of a jobs
that employers added for the month of November was and
also what the unemployment rate was for last month. Economists
expect the unemployment rate the main at four point one percent,
which is still historically low. We'll see how that shakes out, obviously,
(08:02):
and the other thing the economists are looking for as
employers adding two hundred thousand jobs. That would be a
lot better than what they did the prior month, which
was just an addition of twelve thousand jobs. Now, remember though,
that was very low, and it was very low, most
likely because of hurricanes Helene and Milton. Now, with that
(08:23):
being said, we also saw, getting back to data revisions,
the government revised the prior two months, so you're looking
at September and August lower by one hundred and twelve thousand,
and there was no weather impact in that data. So
what that shows is that while the job market is
(08:44):
in decent shape with a four point one percent unemployment rate,
you know, it's definitely some cracks out there. There are
definitely some cracks out there that we got to keep
watching to see if things start to, you know, crumble,
because that's going to force the Fed's hand and another
direction to where they would have to actually cut rates
more quickly in order to make sure that the unemployment
(09:06):
rate doesn't get out of hand.
Speaker 1 (09:08):
Indy, I want to switch now from the data to lessons.
It's hard to believe, but we are in December now.
So looking back on the past year presidential election, right
markets have been on a tear. What do you think
the lesson if you could say, hey, looking back over
the past year, here's the takeaway for investors, what do
(09:28):
you say.
Speaker 2 (09:28):
That is.
Speaker 3 (09:32):
The most obvious one is, you know, don't freak out
because of politics. Don't freak out because of what you
see in the headlines, because regardless of you know, the
wrong or right party is in the oval office. Markets
have done well and this year is no exception. I
mean even leading up to the election and post election,
we've seen some pretty strong returns. I mean, the large
(09:55):
cap stocks have had another great year. We've had actual
AY fifty three record highs in the s m P
five hundred this year. So that's not just since the election.
That was before the election. There was plenty before the election.
And what the market's looking at, the market's looking at
the economy being in decent shape, and that translates into
(10:17):
corporate profits really uh, you know, lifting stock prices because
earnings are what matter more. They had are, so they
matter so much more than what the is going on
in the obal office. They matter so much more than
what's going on and you know, local politics or whatever
headline you want to see, that is more often than not.
(10:38):
I mean, people are trying to sell advertising and they're
able to do that by selling fear. But when you
look past the headlines, what you see is you see
the economy still in good shape. You see companies like
Procter and Gamble earning record amounts of money, and that
in turn is resulting in your four or one K
looking pretty good.
Speaker 1 (10:59):
Great perspective as always from our chief investment officer and
the stout. And there's an analyst out there who is
making headlines right now for saying you shouldn't have more
than sixty percent of your retirement dollars in stocks, regardless
of what age you are. We're gonna look at that
argument next. You're listening to Simply Money presented by all
Worth Financial. Here in fifty five KRC the talk station.
(11:23):
You're listening to Simply Money presented by all Worth Financial.
I mean me Wagner along with Steve Rube. If you
can't listen to our show every night, you don't have
to miss a thing that we talk about. We have
a daily podcast for you. Just search Simply Money. It's
right there on the iheartapp or wherever you get your podcasts.
Coming up at six forty three, we're looking at the
world of dividend funds.
Speaker 2 (11:42):
Does this make sense for you? We'll talk about it. Okay.
Speaker 1 (11:45):
How many subscription services are you shelling out money for
every month?
Speaker 2 (11:50):
And have you ever had issues with any of them?
Speaker 1 (11:53):
Because recently something came to light, specifically with Netflix and
for those of you who watched that huge Mike Tyson,
Jake Paul fights whatever it was acting I don't even
know exactly.
Speaker 2 (12:06):
What that was.
Speaker 4 (12:09):
Money grab.
Speaker 1 (12:10):
Money grab is a great way of putting it and
then made so much money. And for those who wanted
to tune in, a lot of you who tuned in
via Netflix couldn't.
Speaker 2 (12:19):
Even see it.
Speaker 4 (12:20):
Did you try to watch it or did you watch it?
Speaker 1 (12:22):
No, my husband kept clicking back over back and forth,
which drives me crazy anyway. But it was all the
fights leading up to it. But I mean it was like,
you know, you could have called how that was going
to go long before it went down, so it wasn't worth.
Speaker 4 (12:35):
Me staying up for I mean, it was still the
whole spectacle of it that I almost felt obligated to
watch that. Yeah, I did, and I didn't have as
many problems as other people did when it When I
first turned it on, I got a little spinny circle
and then I like exited out and went back in
and it just picked up my my I would imagine
my stream. That meant that it was a few seconds
to late, which whatever I don't particularly care about, but
(12:58):
I know that there was a lot of talk about
people just not able to watch it because it was
the stream was causing so many problems and it's gone
as far as a Florida man suing Netflix over.
Speaker 1 (13:12):
I know, right, I mean, in the world of things
that are so upsetting that you should sue over, I'm
not going to question anybody else's decisions, but this is
an interesting one.
Speaker 2 (13:24):
The lawsuit is accusing Netflix of providing a substandard.
Speaker 1 (13:27):
Experience during an event which was expected to draw a
high viewership, no questions. So many people were watching that,
and I know it is frustrating when you can't watch,
you know, games that you're really into or whatever, when
it's this just I don't want to call it.
Speaker 2 (13:43):
It's absurd.
Speaker 4 (13:44):
Okay, sure call it absurd, that's fine. Call it what
you need to amy. I mean, the lawsuit itself is
full of hyperbole here, I mean it says these are
words from the lawsuit itself. Sixty million Americans were hyped
to see Aron Mike Tyson the Baddest man on the
planet versus YouTuber turn Prize fighter Jake Paul the Baddest
streamer on the planet. Like that's actually from the lawsuit.
Speaker 1 (14:06):
Yes, the baddest dreaming on the planet is what they
called it.
Speaker 3 (14:10):
I don't know.
Speaker 1 (14:11):
I mean first world problems, right, First world problems.
Speaker 2 (14:15):
I don't know.
Speaker 1 (14:17):
You've heard his preach over and over that everyone's financial
situation is unique. We have different goals, we've saved different amounts.
Speaker 2 (14:25):
But tonight there is someone.
Speaker 1 (14:27):
Out there who's making a claim about something that he
says makes sense for everyone. You know, often when someone
comes out with a roll of thumb, we're going to
pretty immediately call it a role of dumb. We'll get
into that in a moment, but I'm just going to
put it out here for you, Steve.
Speaker 2 (14:43):
This is a regular contributor to market Watch.
Speaker 1 (14:45):
His name is Mark Colbert, and he claims that even
if you're twenty two in your first working and you're
first putting money into a four to one k for retirement,
no more than sixty percent of that money should be
exposed to the stock market.
Speaker 4 (15:00):
No, thank you. Yeah, even if you plan to work
another thirty or forty years. He's saying this. I mean
the article, it's titled why no more than sixty percent
of your retirement money belongs in stocks? This blows my mind.
You know, he does acknowledge that his advice runs directly
counter to kind of a glide path strategy that exists.
(15:23):
It's kind of what a target it's exactly what a
target date retirement fund does, which you know Steve Sprovac
used to call a good enough fund. If you're just
entering the workforce, you have your first four to one K,
and you want to use a target date twenty sixty fund,
I mean, go for it. As your situation gets more complex,
your needs get more complex. Obviously, a fiduciary financial planner
is going to argue find the sweet spot for the
(15:45):
level of risk you need to take, comfortable taking the
risks that you can afford to take to optimize your
growth strategy over the years. But this guy just comes
out and says the glide pass strategy oftentimes falls short
to a simple constant sixty forty.
Speaker 1 (16:00):
Yes, he did a little experiment here. He looked at
his sort of sixty forty you know, for over forty years,
how that portfolio would do versus the traditional glide path.
Say you're in your twenties and you're putting ninety percent
in the stock market, and then that glides right a
little more conservatively as you get closer to retirement. And
(16:21):
he looked at the results of that portfolio, and here's
his conclusion in thirty four percent of the years. He
says his portfolio sixty forty had more retirement than that
glide Path portfolio. Right, so thirty four percent of the time,
about a third of the time. In an additional maybe
third of the years, it came very close to matching
the glide Path lagging by less than one half of
(16:44):
a percentage point. I have so many issues with this,
and I think one of them is and I'm speaking
on behalf of a lot of the investors that we
work with here at all worth. Many of them understand
how the market cycles work, that every four to six
there's going to be potentially a twenty percent pullback to
the markets, and as the result of that, I know
(17:06):
lots of them have just really because they understand how
markets work, and that the fact that they rebound one
hundred percent of the time to new hives don't necessarily
aren't curled up around their money. They understand, you know,
so they're fine with having ninety percent in stock, are
exposed to stocks over the course of.
Speaker 2 (17:24):
Most of their working years. That wasn't even part of
this equation.
Speaker 4 (17:27):
Yeah, it doesn't take into consideration a dollar cost averaging
as well. I mean, what are we doing here, Because
when the markets go down and you're actually putting in
a set amount through your paycheck each pay period, then
you're buying those investments when they're at a discount, so
that when the markets go back up, now you have
more shares and you see that wealth balloon, sometimes very quickly,
(17:50):
depending on the size of your portfolio.
Speaker 1 (17:53):
I just think of someone in their twenties with only
sixty percent stock exposure, and it actually like boggles my mind.
And I think if you start there and then you're
talking about maybe thinking about getting more consistent through the years,
where are you going to end up?
Speaker 4 (18:07):
I mean fifty to fifty, right.
Speaker 2 (18:09):
Forty sixty, you know?
Speaker 1 (18:10):
And I think the concern there is when you look
at inflation, and hello inflation over.
Speaker 2 (18:15):
The past few years.
Speaker 1 (18:16):
You know, we talk about the silent killer of retirement.
You get too conservative in nut stock exposure and by
the time you're paying taxes, by the time you're paying inflation,
you're actually losing ground on your investments. And so I
just think by putting out there this blanket statement, nobody
should have more than sixty percent stock exposure.
Speaker 2 (18:36):
If you are putting those dollars toward retirement. It makes
zero sense to me.
Speaker 4 (18:40):
No, no, it doesn't, and it doesn't take into consideration
the financial situation as you enter retirement, such as sources
of fixed income like a pension, social security, part time work,
the types of things that would make it so you
don't actually have to tap into your investments, in which
case you wouldn't necessarily be focusing on building a legacy
at that point. If you're only sixty forty, then over
(19:01):
the long term, it's not going to give you an opportunity.
You're talking about inflation, that's a great point. Yeah, that
is a silent killer. But if you want your money
to turn into more money, and that money makes more money, yeah,
that's compounding interests. That's where you need to have a
higher stock exposure to enable your investments to actually do
that for you, especially if you're going to retire early
and you have inflation to worry about and a longer
(19:24):
time horizon to pull from the investments. This is not
an article that I agree with.
Speaker 2 (19:29):
If you cannot, yeah, not at all. To your point.
Speaker 1 (19:31):
I have a number of clients who have enough income
and retirement that they're not pulling from those investments whatsoever.
So it would make sense to let it grow. Here's
the all Worth advice. We don't believe in this one
size fits all, and neither should you find yourself a
good financial advisor who can tailor an approach specifically for you. Okay,
just in time for the holidays, We've got some scams
(19:54):
to talk about how to protect yourself.
Speaker 2 (19:55):
Our colleague Bill Shredder is in for that.
Speaker 1 (19:57):
Next, you're listening to Simply Money presented by all Worth
Findinancial Here on fifty five KRC the talk station. You're
listening to Simply Money presented by all Worth Financial.
Speaker 2 (20:09):
I Needy Wagner along with Steve Ruby.
Speaker 1 (20:12):
Tis the season for lots of things right, spending the
holidays and also scammers trying to target you, your family,
your loved ones.
Speaker 2 (20:21):
We have a special treat for you tonight. Joining us
is one of.
Speaker 1 (20:23):
Our colleagues, Bill Schredder, who has a special designation. He
is an expert in how to protect his clients from scams.
And I really want to start with that, Bill, How
did you This isn't a designation that a lot of
financial advisors have. How did you get to the point
of having one?
Speaker 4 (20:42):
Correct?
Speaker 5 (20:42):
Actually, very few financial planners have them. Yeah. I started
doing it simply because I had clients who were being
scammed and I was doing a lot of research for them.
And by the time I was done doing all that research,
I was like, the credential makes sense. Yeah, because unfortunately,
specially people over the age of sixty five, over the
age of sixty But now it's truly everybody. We're all
(21:05):
targets of, you know, people who want to commit fraud,
who want to steal your money.
Speaker 2 (21:10):
Yeah.
Speaker 5 (21:11):
The level of scams out there and how good the
scams are is just improving constantly, and it's very difficult
to detect.
Speaker 4 (21:20):
Yeah, this is one where I imagine the continuing education
is rather important because I feel like criminals that use
this energy of THEIRS for scamming. You know, I don't
have the letters after my name like you do, but
I sure hate these scammers. It's truly a disgusting thing.
CFCs Certified Financial Crime Specialists. I think that's pretty cool.
I know that you wanted to talk about a couple
(21:42):
of scams that are front and center right now as
we transition into the holiday season, specifically a holiday recipe
website fraud where I think somebody in your family actually
fell victim to this.
Speaker 5 (21:53):
Yeah, family and friends. Yeah, and it's happening more and
more often. But what happens is you go to a website.
You're looking up recipe for Thanksgiving, recipe for Christmas, and
you're reading it, no problem, and all of a sudden,
big blaring, you know sound, you know, screeching sound comes
through your your computer telling you you're being hacked. And
(22:14):
it's coming from like, you know, Microsoft Defender or you
know some other sounds like a legitimate name, and it
gives you an eight hundred number to call. And of course,
because basically it's screaming at you, get it gets your attention, panic,
let me let me call. And while you're while you're
talking to a person who stays in character, they're collect
(22:35):
they're collecting all your personal information, and then ultimately they're like, well,
let's send I'll send you a link to access your computer.
And they're talking to you and they're showing you screenshots
of what you know, what's on your computer, but none
of those are real. They have somebody else accessing your computer,
stealing whatever data they can, and meanwhile you're giving them
(22:55):
your personal information, very often credit card numbers, bank account numbers,
I mean, you know, they charge a fee as well
to do this with you. And the unfortunate thing is
is then the next thing, you know, you get off
the phone call, everything seems to be working fine, and
a few days later, your accounts and your credit cards,
you know, and even your computer all of a sudden
(23:16):
is ransomware. Or basically you are you're seeing withdraws, big
withdraws from your accounts.
Speaker 2 (23:22):
And all you were doing was try to look at
a recipe.
Speaker 5 (23:24):
All yeah, because the website is actually fake. What it's
doing is it's showing up in search engines usually you know,
three or four down. It's free, and what happens is,
basically you go to it. It's a neat recipe because
the recipes that are on the site are real. But
the site itself is designed for, you know, for phishing
and forgetting this information from you. And even if ultimately,
(23:48):
you know, they can't get in your computer or they
don't get a lot from you, every data point they
get on you is worth money. This is a business
run by criminal syndicates. You know, your profile and initially
be worth ten dollars to them, that's what they paid
for it.
Speaker 4 (24:03):
They add data to.
Speaker 5 (24:04):
It, like your driver's license number, or your sold security number,
or a credit card or pin number. The more they
add to it, the more valuable your profile becomes, either
for themselves to use or they sell it to another syndicate.
I mean all of us. We're constantly getting these days
emails and text messages from what we think are legitimate sites.
(24:27):
You know it's coming from Amazon. No, it's not.
Speaker 2 (24:30):
Yeah, they just know that.
Speaker 5 (24:32):
Okay, thirty percent of America shops at Amazon, especially the
holiday season. This is a great time to say there's
a problem with your order.
Speaker 2 (24:39):
I've always said.
Speaker 1 (24:40):
That about scammers that wherever there are a lot of
people and wherever there's a lot of money changing hands,
right they're going to figure out a way to be.
Speaker 2 (24:48):
In the middle of that.
Speaker 1 (24:50):
To your point, we're ordering so many packages right now,
We're doing so much holiday shopping. I have my credit
card number memorized after this weekend, just.
Speaker 2 (24:59):
Buying so much.
Speaker 1 (25:01):
What's your advice to people as they're taking off things
on their list, their holiday shopping list, how can they
make sure that they're also protecting their information, their financial information.
Speaker 5 (25:11):
Okay, there are a few things that they can do.
Number one, of course, it's the realization that nobody needs
your full sol Security number. Yes, hey, the IRS is
not going to call you and ask you for your
soul Scurity number if you're already have it. You know
the banks are not going to do the same thing.
So any any text message, any email you get that's
basically a panic telling you you're gonna lose your soul
Security benefit, You're gonna lose your health insurance. There's going
(25:33):
to be a problem with the direct deposit. You know
that is most likely fake creating Urgency Act exactly. So
you know, that's one thing as far as realizing that
the information is not needed. You don't need to give
it to anybody. If someone asks for your PIN number,
hang up on them. The other thing that I recommend
to people is if you're using bank accounts like a
(25:53):
debit card, don't have that debit card connected to an
account that has a lot of money in it. For example,
if I use a debit card on a website it
turns out it's fraudulent. I gave away that number, They're
going to start testing the account. You know, trying to
take a dollar, trying to take five dollars, you know,
ten dollars, one hundred one thousand, ten thousand, especially around
when sold security is due to arrive into your account.
(26:16):
If they know your birthday age, they can they can
predict that. But what happens is people can have like
one hundred thousand dollars or fifty thousand dollars sitting in
their checkbook. No, that can be in a savings account,
disconnected from the account where you're using the debit because
somebody is going to actually, you know, take that money
and you know, yes, it can be recovered by the bank,
(26:36):
but it takes time. Meanwhile, you for next ninety days,
you don't have you don't have actual money to pay
your bills necessarily, So that is you know, that's you know,
that's another thing. The other recommendations I have, which are
common ones, is look at who is sending the message.
If it's coming from Microsoft, coming from the IRS, coming
from your bank, I'm pretty sure they're not using a
(26:58):
Gmail account. It's coming from a Gmail account, then it's
you know, it's not odd when you when you hover
over links, the link will tell you basically what it's
going to. I am pretty sure Microsoft does not use
Google drives. I am pretty sure your Amazon does not
use a Google Drive, so you know then that, okay,
(27:19):
this is not a real link. So when you get
text messages, when you get emails, don't use the links
or the phone numbers that they provide in the email
of the text. Instead, go right to the normal source.
If you call your bank, the bank will have the
record of whatever the issue is, if it's real.
Speaker 2 (27:37):
Uh.
Speaker 5 (27:37):
And again, the I R S does not call people.
They do not text people. You know, you know you
will know if you have a tax problem with the
I R S well in advance of this one of this,
you know, offer to basically settle your tax debt for
ten thousand dollars in gift cards.
Speaker 4 (27:53):
Then gift cards. Yeah, that's that's another thing that people
do it exactly right.
Speaker 1 (27:57):
I got a text earlier today and it's a number
I don't recognize. It's a local number, and it says
I didn't forget about shooting the elf pictures with you, literally.
Speaker 2 (28:07):
Like just random something. And I almost was like who
is this? And I was like, this is obviously a scam.
Speaker 1 (28:12):
And then when you respond to these random tax messages,
then then they know that it's a live numbers. So
something else to keep an eye on. If you're getting taxed,
don't don't respond. It's not it's not funny when you just,
you know, try to mess with them, because then they
know they've got a live number.
Speaker 4 (28:28):
It's really tempting to respond with some kind of a
stupid picture of an else, you know, but don't do it.
Speaker 5 (28:33):
Yeah, and when you call them and when you text
them and all that, they will stay in character.
Speaker 3 (28:37):
You know.
Speaker 5 (28:38):
The people on the other end a good at it.
They're very good at it, and sometimes they're actually almost
prisoners to it. They have to do it. It's not
a moral issue. It's like they're trapped somehow.
Speaker 4 (28:47):
That's terrible.
Speaker 5 (28:48):
Oh you think about it, that whoa, it's you know,
it's a serious issue because you can't just walk away
from a criminal syndicate and think, Okay, I'm just going
to go ahead and they'll let me go. There's a
lot of training that goes into these things. You know,
you have to be very good at at different languages
and basically dialects and all that and.
Speaker 2 (29:08):
Acting on top of it. Yeah, great advice.
Speaker 1 (29:13):
What to keep an eye out for for you, for
your loved ones this holiday season in order to protect
yourself from being scammed. From our good friend Bill Shutter
from right here at all Worth you're listening at Simply
Money here on fifty five KRC, the talk station. You're
listening to Simply Money presented by all Worth Financial. I mean,
you Wagner, along with Steve Ruby, you have a financial question.
(29:35):
It's keeping you up at night. You and your spouse
just can't get on the same page. Well, there's a
red button you can click on while you're listening to
the show. It's right there on the iHeart app. Record
your question. It's coming straight to us.
Speaker 3 (29:46):
You know.
Speaker 1 (29:47):
I think, especially when people get closer to retirement, Steve,
it's this sort of mental of that paycheck is no
longer coming in, and now it is what are my
sources of income going to look at look like in retirement?
And for a lot of people either the idea of
dividends sounds great or in some cases it also makes
(30:08):
a lot of sense.
Speaker 4 (30:09):
Yeah, I mean, there's there's potential for rental properties for income.
There's part time work, there's social security, there's pensions.
Speaker 2 (30:17):
Are those lucky enough to have pensions?
Speaker 4 (30:18):
Sure? Yeah, it's kind of fallen to the wayside here,
but nonetheless, another opportunity for income generation would be dividends.
So that's when corporate corporate profits that you know, companies
pay to shareholders flow through on stock or maybe shares
of me TF or a mutual fund that you own
flow through to you as the investor. This is certainly
(30:41):
another way to generate income in retirement for those that
are freaked out, which many are, about what's going to
happen when you're no longer receiving a paycheck.
Speaker 1 (30:49):
Yeah, these can come in the form of individual companies
like Procter and Gamble, Coca Cola. Right, long time, well
established companies tend to pay dividends, sometimes higher dividends or.
Speaker 2 (31:01):
Dividend paying funds also an option here.
Speaker 1 (31:04):
I think when you're a younger investor not yet retired,
if you have some dividend paying funds, often you don't
even see those dividends. You just reinvest them. You just
kind of go back into the investment. But this becomes
more and more important and in a much more interesting
strategy when you get to retirement and you're actually than
living off of, you know, potentially part of these dividends
(31:27):
as part of your income stream.
Speaker 4 (31:29):
Yeah. So when you own an individual stock for a
well established company like you mentioned, like Coca Cola for example,
it's easy to see what kind of dividend that company
may offer in exchange for owning a share. You know,
these are well established companies that are been paying dividends
for a long time, so there's a way that you
can almost count on it in this roam.
Speaker 2 (31:45):
Really do they go down? Sometimes they do? Sure, you
have to say that General Electric.
Speaker 4 (31:49):
Yeah, exactly, I mean it doesn't a penny. A stock
doesn't have to pay you a dividend.
Speaker 3 (31:54):
Right.
Speaker 4 (31:54):
To be clear, that is not something that has happened.
There is risk involved with this, especially if you're counting
on generating income off of you know, your only source
of income being dividends. This is not something I would recommend.
It is certainly a way to diversify income streams and retirement,
and again with an individual company, stocking can be easy
to see what that's going to be usually with that asterisk.
(32:20):
You know, one that I see a lot of in
this region anyways is Procter and Gamble. For example, a
lot of folks not only have retired there, but they
have family that's retired there and maybe even inherited shares,
and they're sitting in you know, an account just paying
you dividends, but there's also dividend paying funds, high dividend
yield strategies versus you know, more of a growth strategy,
(32:40):
where the high dimendend yield strategy is more often than
not continuing to pay those dividends, whereas the growth one
it's not as well of established of a company that
might not pay dividends, but when it doesn't, you're also
potentially seeing the value of the shares go up.
Speaker 1 (32:56):
As a general rule here and this is very general
company it tend to pay dividends or more value companies. Right,
they are the well established you know, think like not
going to win the race, but you know, always coming
in strong.
Speaker 2 (33:12):
Versus where you might get your growth.
Speaker 3 (33:14):
Right.
Speaker 1 (33:15):
You think about the Magnificent seven, right, the companies that
have really fueled the growth in the S and P
five hundred over the course of the past year. Now
I'm not saying those companies you should be necessarily all
in on those individual companies, but they tend to not
pay any dividends. Why because rather than reinvesting the proceeds
into the investors, they reinvest that money into research and development.
(33:37):
More growth, more growth, right, and so I think it
makes sense to have kind of both as part of
your investment portfolio, not necessarily focusing on one to the other.
Speaker 2 (33:47):
And I agree with you.
Speaker 1 (33:48):
For anyone who's like well, I like to be able
to count on dividends.
Speaker 2 (33:51):
This can be my source of income and retirement.
Speaker 4 (33:54):
Not a great plan, no, I mean, certainly there are
folks out there that are very comfortable and having a
dividend paying portfolio and generating income off of it. But
at the same time, you're potentially giving up capital appreciation. Yeah,
you're giving up the opportunity to be invested in some
of these growth companies where over the long term you're
keeping up with inflation. There's maybe a little bit more
(34:16):
speculation involved that could grow your assets more than just
a portfolio of high dividend paying value company stock. This
is certainly a place that can hold up. It's a
strategy you can hold a place in your overall portfolio
for generating some income. But this isn't something that I
would recommend as your only means of generating income or
(34:38):
what you want to do with your portfolio in its entirety.
Speaker 2 (34:41):
Here's the all worth advice.
Speaker 1 (34:43):
Talk to a financial professional to see if this strategy
can make sense for you, but don't go all in on.
Speaker 2 (34:49):
Any strategy until you've talked to a pro.
Speaker 1 (34:52):
Coming up next December is here and so as a
little Wagner wisdom, that's natural. Listening to Simply Money presented
by all Worth Financial here on fifty five KRC the
talk station.
Speaker 2 (35:08):
You're listening to Simple.
Speaker 1 (35:10):
Money present Am I all Worth Financial. I Meani WAGNERA along.
Speaker 2 (35:12):
With Steve Ruby. For those of you who have.
Speaker 1 (35:15):
Not checked the calendar yet, we are in December.
Speaker 2 (35:19):
You have to know.
Speaker 1 (35:19):
I mean every time you turn on the radio Christmas music,
any stores that you go into Christmas, It's Christmas time everyone.
Speaker 2 (35:25):
We are at the holidays.
Speaker 1 (35:28):
And it allowed me to have some interesting conversations over
the past weekend and really reflect on how much December
and the holidays have become about like consumption in spending
money and listen, I'm not the grinch about this, but
my I sound a little grinchy, but I don't want
you all to feel like a grinch in January when
(35:50):
the credit card bills start to come.
Speaker 2 (35:53):
Yes, I'm helping everyone think ahead.
Speaker 1 (35:56):
Here's why holidays can get bigger and bigger every year
we talk about lifestyle creep, there's holiday creep.
Speaker 2 (36:03):
I think it.
Speaker 1 (36:03):
Happens, and it's like, you know, you kind of make
holidays nicer and nicer every year. Speaking of my own family, right,
We've got I've got nieces and nephews who are now
getting married. We've got boyfriends of my kids that are
part of the gets bigger and bigger and bigger. And
in my parents they buy for everyone and it's just
insanity for them to even keep up with all of it.
Speaker 2 (36:24):
And this year we decided, okay, for the adults, we're
just going to pick a name and buy for each other.
Speaker 1 (36:31):
And we just included our parents in that so that
they're not gone for eight million people.
Speaker 2 (36:36):
And it was a way to.
Speaker 1 (36:37):
Make it a little easier, a little less expensive, and
still make it fun for everyone.
Speaker 4 (36:44):
This is great because I'm sure not everybody in your
family is on the same exact financial wavelength.
Speaker 2 (36:49):
Sure.
Speaker 4 (36:50):
Yeah, So creating a scenario we're not where you're almost
not obligated to spend money on everybody because you just
have that one name can be a very big relief
for some folks in your family, I would imagine here,
And if not your family, then certainly others that would
implement a very similar strategy to what you're doing in
your household and in your family.
Speaker 1 (37:11):
And I was also talking to my best friend on
my way into the office this morning, and she was
talking about the fact that she started Christmas shopping in
October because she wanted to spread it out over three
credit card bills.
Speaker 4 (37:23):
Oh that sounds terrible.
Speaker 2 (37:25):
Okay for you who wait until Christmas Eve to do
your Christmas.
Speaker 4 (37:28):
Shop O day Christmas Eve, come on, give me some
credit Christmas.
Speaker 2 (37:31):
Eve, December twenty third.
Speaker 1 (37:32):
But for those who liked to plan ahead and don't
want the ginormous bill in January, that can also play
out really well. So don't get to December without a plan,
spend like crazy, get to January, can't pay it all off.
And I think experiences rather than stuff I've seen this
year over year every year.
Speaker 2 (37:53):
And I said it to my husband again the other day.
Speaker 1 (37:55):
I was spent all day online shopping for the kids,
and I was like, share, can we just like do.
Speaker 2 (38:00):
Something where there's a memory involved.
Speaker 1 (38:02):
And we're not buying all this little stuff that, by
the way, by the time February rulls around, the've forgotten
about it.
Speaker 4 (38:07):
Anyway, give yourself some credit. You can find something sentimental
that might stick with them and their memories.
Speaker 1 (38:12):
Yeah, well maybe just kind of a middle ground. But
it's easy to get into this holiday season. And just
as seed deals, right, I mean, it's cyber Monday now
and there's everywhere. Every time you get online, there's seventy
five different emails with great deals that you just can't
pass up, and so you just buy bye bye, keep track,
don't let your credit card bill surprise you when it
(38:32):
comes to January. And if it seems to be exorbitant
and it's becoming stressful, have conversations. Be the one to
bring it up in your family. I guarantee if you're
feeling that way, there are there are other people in
your family feeling.
Speaker 2 (38:46):
The same way. Thanks for listening. We hope you're going
to tune in tomorrow.
Speaker 1 (38:49):
We're talking about why just investing in the S and
P five hundred may not be diversified enough. You've been
listening to Simply Money, presented by all Worth Financial here
on fifty five krs the talk station and
Tonight is inflation stock plus how much money should you
really have in the stock market? You're listening to Simply Money,
presented by all Worth Financial and Ami Wagner along with
Steve Ruby.
Speaker 2 (00:17):
Everyone hopefully has recovered from their Turkey comus in time
to start thinking once.
Speaker 1 (00:22):
Again about the markets. What's going on? How's your four
one k? And maybe because so many people did cook
and bake over the weekend, maybe the conversation was a
long line of inflation and eggs, because yes, eggs are
getting expensive once again joining us tonight, not necessarily on
the price of eggs, but yes, the impact of inflation
(00:43):
is our chief investment Officer, Andy Stout. Andy, you had
said many times over the past couple of years that
as the Federal Reserve, our niche and central Bank worked
to bring down inflation by raising interest rates, that it
could get tricky and a little sticky. And I think
that's where we've landed with inflation.
Speaker 3 (01:00):
Yeah, if you look at where inflation is right now
and how it's evolved the past few years, the easy
part of the FED job it's done now. The FED
is in that last mile and it's just like in
a marathon, which for the record. I have never run,
nor will I ever.
Speaker 2 (01:17):
Run, but you heard last mile.
Speaker 3 (01:21):
From what I've heard, that last mile is really hard.
So and that's where the FED is right now. The
last mile for this inflation battle. It's going to be
a long one. It's not as easy as getting it
down when we had that initial spike in June of
twenty two. Now we're at the point where we're seeing
(01:41):
these monthly ratings still coming in a little bit higher
than we want, and that's going to make it last
longer before we get to where the FED wanted to be.
On top of all of that, we're talking about slowing
down inflation. That doesn't mean prices revert back to where
they were, that would be def We're just talking about
slowing the growth of inflation. So if you're expecting the
(02:06):
price of eggs or whatever it is to get back
to where it was before June of twenty twenty two,
you're probably going to be waiting for a long while.
And in all honesty, you probably don't want that because
if that does happen, it's going to come along with
some other things like a pretty deep recession, a pretty
strong drop into stock market. So really you just want
(02:29):
inflation to slow down to become more manageable, because otherwise
your whole lifestyle change will or your whole lifestyle will
see a decrease for the worst.
Speaker 4 (02:39):
Well, let's be clear, inflation might be a little sticky currently,
but the economy, when we pull back the curtain a
little bit, still has firm footing. Correct.
Speaker 3 (02:49):
Yeah, we got the third and final update for GDP growth,
which is the total growth of the US economy for
the third quarter. We got that last week and it
came in at two point eight percent, which is decent,
but really kind of how we think about it, Steve is,
if growth is at two percent, we'll call that, we
(03:10):
call that trend growth. So basically what you would expect
if the economy is experiencing just normal growth and the
Federal Reserve has a neutral stance, meaning they're not being
restrictive or accommodative with interest rates. Currently they're being restrictive. Still,
we're seeing above trend growth, which is pretty impressive, and
(03:33):
that just goes to show you that the consumers are
keeping uh on their steady diet of spending. And I mean,
if you just think about it, the overall makeup of
the economy is seventy percent consumer spending, and we got
some data last week showing that personal spending is continuing.
Speaker 5 (03:55):
Uh.
Speaker 3 (03:56):
And on top of that, though, personal incomes also saw
a pretty good increase, and that's a positive because what
that means is that savings rate has increased from four
point one to four point four percent, and that means
that the consumers have a longer runway to keep spending
to keep this economy chugging along. So we're seeing some
(04:16):
definite progression for the overall economy and we're not seeing
much risk in the near term in terms of economic downside.
Speaker 1 (04:26):
You just answered all my questions. I was just going
to say, Andy that you have a recession scorecard, which
is looking at what fourteen leading economic indicators to say, hey,
here's what we think the economy is going moving forward.
Speaker 2 (04:38):
What does that tell you?
Speaker 1 (04:39):
And then also I'm just wondering what your your comment
is on the resiliency of the consumer, because you know,
we look at so many headlines and doing the show,
and there have been so many people over the course
of the past year making all kinds of terrible predictions
about where the economy is heading, where the stock market
is heading.
Speaker 2 (04:57):
Yet it doesn't seem to bear that out.
Speaker 3 (05:01):
Yeah, and a lot of that is on the consumer side,
or we've been influenced heavily by what the government did
post COVID For obviously, they are trying to keep the
economy afloat when the whole economy shut down, not just
here in the US but globally, and what happened was
the flood of money that entered the economic system has
(05:27):
really it's well, first of all, it's burred inflation, but
it's also made up more challenging to have a deeper
understanding of different indicators because you're being influenced by this
massive money supply that's out there, and that's just made
the overall analysis more challenging. On top of that, another
thing that's made things more challenging is constantly data constantly
(05:51):
being revised. For instance, if we went back about three
months ago, the government had said the savings rate was
two point eight percent, which is very low, and that
had me worried that, Okay, you know, stuff is about
to get, you know, really bad. However, the next month
they revised it up from two point eight to four
point nine.
Speaker 2 (06:12):
I'm gonna say, I've never heard you use the word worried.
Speaker 3 (06:15):
Before well, I mean aside from you know, talking about
you know, my kids, and you know the worries they
give me. Sure, you're right, But the thing is, the
data said one thing, and then all of a sudden
the government changed the data and that's completely changed the picture.
And then where we look at where the data is
(06:36):
right now, it certainly suggests that these leading economic indicators,
which are data that moves before the broad economy, you
got to take with them a little less, uh, you know,
with the less of a grain of salt, because what's
going on is there being the water is being muddied
by constant revisions, by the influx of money from the government.
Speaker 4 (06:57):
Uh.
Speaker 3 (06:57):
But when we take a step back and we look
at the big picture, things are okay. The world isn't
coming to an end. The economy's on decent footing. Inflation
is still higher than where we want it to be,
but that should come down. But I don't expect it
to come down anytime soon. Maybe second quarter of next year,
maybe the third quarter. Before we see any real progress.
I kind of think we're going to kind of be
stuck in this two and a half percent and inflation
(07:21):
ran on year over year basis for some time, and
that's going to keep the Fed slow and cautious when
it comes to interest rate cuts.
Speaker 4 (07:30):
Yeah, I want to hone in on that a little
bit because we have some important updates coming out this
week that obviously could impact the Fed's next decision. So
let's let's chat about that.
Speaker 3 (07:39):
Yeah, probably the biggest one is going to be the
monthly jobs report. So when we get that on Friday,
we're going to see what the number of a jobs
that employers added for the month of November was and
also what the unemployment rate was for last month. Economists
expect the unemployment rate the main at four point one percent,
which is still historically low. We'll see how that shakes out, obviously,
(08:02):
and the other thing the economists are looking for as
employers adding two hundred thousand jobs. That would be a
lot better than what they did the prior month, which
was just an addition of twelve thousand jobs. Now, remember though,
that was very low, and it was very low, most
likely because of hurricanes Helene and Milton. Now, with that
(08:23):
being said, we also saw, getting back to data revisions,
the government revised the prior two months, so you're looking
at September and August lower by one hundred and twelve thousand,
and there was no weather impact in that data. So
what that shows is that while the job market is
(08:44):
in decent shape with a four point one percent unemployment rate,
you know, it's definitely some cracks out there. There are
definitely some cracks out there that we got to keep
watching to see if things start to, you know, crumble,
because that's going to force the Fed's hand and another
direction to where they would have to actually cut rates
more quickly in order to make sure that the unemployment
(09:06):
rate doesn't get out of hand.
Speaker 1 (09:08):
Indy, I want to switch now from the data to lessons.
It's hard to believe, but we are in December now.
So looking back on the past year presidential election, right
markets have been on a tear. What do you think
the lesson if you could say, hey, looking back over
the past year, here's the takeaway for investors, what do
(09:28):
you say.
Speaker 2 (09:28):
That is.
Speaker 3 (09:32):
The most obvious one is, you know, don't freak out
because of politics. Don't freak out because of what you
see in the headlines, because regardless of you know, the
wrong or right party is in the oval office. Markets
have done well and this year is no exception. I
mean even leading up to the election and post election,
we've seen some pretty strong returns. I mean, the large
(09:55):
cap stocks have had another great year. We've had actual
AY fifty three record highs in the s m P
five hundred this year. So that's not just since the election.
That was before the election. There was plenty before the election.
And what the market's looking at, the market's looking at
the economy being in decent shape, and that translates into
(10:17):
corporate profits really uh, you know, lifting stock prices because
earnings are what matter more. They had are, so they
matter so much more than what the is going on
in the obal office. They matter so much more than
what's going on and you know, local politics or whatever
headline you want to see, that is more often than not.
(10:38):
I mean, people are trying to sell advertising and they're
able to do that by selling fear. But when you
look past the headlines, what you see is you see
the economy still in good shape. You see companies like
Procter and Gamble earning record amounts of money, and that
in turn is resulting in your four or one K
looking pretty good.
Speaker 1 (10:59):
Great perspective as always from our chief investment officer and
the stout. And there's an analyst out there who is
making headlines right now for saying you shouldn't have more
than sixty percent of your retirement dollars in stocks, regardless
of what age you are. We're gonna look at that
argument next. You're listening to Simply Money presented by all
Worth Financial. Here in fifty five KRC the talk station.
(11:23):
You're listening to Simply Money presented by all Worth Financial.
I mean me Wagner along with Steve Rube. If you
can't listen to our show every night, you don't have
to miss a thing that we talk about. We have
a daily podcast for you. Just search Simply Money. It's
right there on the iheartapp or wherever you get your podcasts.
Coming up at six forty three, we're looking at the
world of dividend funds.
Speaker 2 (11:42):
Does this make sense for you? We'll talk about it. Okay.
Speaker 1 (11:45):
How many subscription services are you shelling out money for
every month?
Speaker 2 (11:50):
And have you ever had issues with any of them?
Speaker 1 (11:53):
Because recently something came to light, specifically with Netflix and
for those of you who watched that huge Mike Tyson,
Jake Paul fights whatever it was acting I don't even
know exactly.
Speaker 2 (12:06):
What that was.
Speaker 4 (12:09):
Money grab.
Speaker 1 (12:10):
Money grab is a great way of putting it and
then made so much money. And for those who wanted
to tune in, a lot of you who tuned in
via Netflix couldn't.
Speaker 2 (12:19):
Even see it.
Speaker 4 (12:20):
Did you try to watch it or did you watch it?
Speaker 1 (12:22):
No, my husband kept clicking back over back and forth,
which drives me crazy anyway. But it was all the
fights leading up to it. But I mean it was like,
you know, you could have called how that was going
to go long before it went down, so it wasn't worth.
Speaker 4 (12:35):
Me staying up for I mean, it was still the
whole spectacle of it that I almost felt obligated to
watch that. Yeah, I did, and I didn't have as
many problems as other people did when it When I
first turned it on, I got a little spinny circle
and then I like exited out and went back in
and it just picked up my my I would imagine
my stream. That meant that it was a few seconds
to late, which whatever I don't particularly care about, but
(12:58):
I know that there was a lot of talk about
people just not able to watch it because it was
the stream was causing so many problems and it's gone
as far as a Florida man suing Netflix over.
Speaker 1 (13:12):
I know, right, I mean, in the world of things
that are so upsetting that you should sue over, I'm
not going to question anybody else's decisions, but this is
an interesting one.
Speaker 2 (13:24):
The lawsuit is accusing Netflix of providing a substandard.
Speaker 1 (13:27):
Experience during an event which was expected to draw a
high viewership, no questions. So many people were watching that,
and I know it is frustrating when you can't watch,
you know, games that you're really into or whatever, when
it's this just I don't want to call it.
Speaker 2 (13:43):
It's absurd.
Speaker 4 (13:44):
Okay, sure call it absurd, that's fine. Call it what
you need to amy. I mean, the lawsuit itself is
full of hyperbole here, I mean it says these are
words from the lawsuit itself. Sixty million Americans were hyped
to see Aron Mike Tyson the Baddest man on the
planet versus YouTuber turn Prize fighter Jake Paul the Baddest
streamer on the planet. Like that's actually from the lawsuit.
Speaker 1 (14:06):
Yes, the baddest dreaming on the planet is what they
called it.
Speaker 3 (14:10):
I don't know.
Speaker 1 (14:11):
I mean first world problems, right, First world problems.
Speaker 2 (14:15):
I don't know.
Speaker 1 (14:17):
You've heard his preach over and over that everyone's financial
situation is unique. We have different goals, we've saved different amounts.
Speaker 2 (14:25):
But tonight there is someone.
Speaker 1 (14:27):
Out there who's making a claim about something that he
says makes sense for everyone. You know, often when someone
comes out with a roll of thumb, we're going to
pretty immediately call it a role of dumb. We'll get
into that in a moment, but I'm just going to
put it out here for you, Steve.
Speaker 2 (14:43):
This is a regular contributor to market Watch.
Speaker 1 (14:45):
His name is Mark Colbert, and he claims that even
if you're twenty two in your first working and you're
first putting money into a four to one k for retirement,
no more than sixty percent of that money should be
exposed to the stock market.
Speaker 4 (15:00):
No, thank you. Yeah, even if you plan to work
another thirty or forty years. He's saying this. I mean
the article, it's titled why no more than sixty percent
of your retirement money belongs in stocks? This blows my mind.
You know, he does acknowledge that his advice runs directly
counter to kind of a glide path strategy that exists.
(15:23):
It's kind of what a target it's exactly what a
target date retirement fund does, which you know Steve Sprovac
used to call a good enough fund. If you're just
entering the workforce, you have your first four to one K,
and you want to use a target date twenty sixty fund,
I mean, go for it. As your situation gets more complex,
your needs get more complex. Obviously, a fiduciary financial planner
is going to argue find the sweet spot for the
(15:45):
level of risk you need to take, comfortable taking the
risks that you can afford to take to optimize your
growth strategy over the years. But this guy just comes
out and says the glide pass strategy oftentimes falls short
to a simple constant sixty forty.
Speaker 1 (16:00):
Yes, he did a little experiment here. He looked at
his sort of sixty forty you know, for over forty years,
how that portfolio would do versus the traditional glide path.
Say you're in your twenties and you're putting ninety percent
in the stock market, and then that glides right a
little more conservatively as you get closer to retirement. And
(16:21):
he looked at the results of that portfolio, and here's
his conclusion in thirty four percent of the years. He
says his portfolio sixty forty had more retirement than that
glide Path portfolio. Right, so thirty four percent of the time,
about a third of the time. In an additional maybe
third of the years, it came very close to matching
the glide Path lagging by less than one half of
(16:44):
a percentage point. I have so many issues with this,
and I think one of them is and I'm speaking
on behalf of a lot of the investors that we
work with here at all worth. Many of them understand
how the market cycles work, that every four to six
there's going to be potentially a twenty percent pullback to
the markets, and as the result of that, I know
(17:06):
lots of them have just really because they understand how
markets work, and that the fact that they rebound one
hundred percent of the time to new hives don't necessarily
aren't curled up around their money. They understand, you know,
so they're fine with having ninety percent in stock, are
exposed to stocks over the course of.
Speaker 2 (17:24):
Most of their working years. That wasn't even part of
this equation.
Speaker 4 (17:27):
Yeah, it doesn't take into consideration a dollar cost averaging
as well. I mean, what are we doing here, Because
when the markets go down and you're actually putting in
a set amount through your paycheck each pay period, then
you're buying those investments when they're at a discount, so
that when the markets go back up, now you have
more shares and you see that wealth balloon, sometimes very quickly,
(17:50):
depending on the size of your portfolio.
Speaker 1 (17:53):
I just think of someone in their twenties with only
sixty percent stock exposure, and it actually like boggles my mind.
And I think if you start there and then you're
talking about maybe thinking about getting more consistent through the years,
where are you going to end up?
Speaker 4 (18:07):
I mean fifty to fifty, right.
Speaker 2 (18:09):
Forty sixty, you know?
Speaker 1 (18:10):
And I think the concern there is when you look
at inflation, and hello inflation over.
Speaker 2 (18:15):
The past few years.
Speaker 1 (18:16):
You know, we talk about the silent killer of retirement.
You get too conservative in nut stock exposure and by
the time you're paying taxes, by the time you're paying inflation,
you're actually losing ground on your investments. And so I
just think by putting out there this blanket statement, nobody
should have more than sixty percent stock exposure.
Speaker 2 (18:36):
If you are putting those dollars toward retirement. It makes
zero sense to me.
Speaker 4 (18:40):
No, no, it doesn't, and it doesn't take into consideration
the financial situation as you enter retirement, such as sources
of fixed income like a pension, social security, part time work,
the types of things that would make it so you
don't actually have to tap into your investments, in which
case you wouldn't necessarily be focusing on building a legacy
at that point. If you're only sixty forty, then over
(19:01):
the long term, it's not going to give you an opportunity.
You're talking about inflation, that's a great point. Yeah, that
is a silent killer. But if you want your money
to turn into more money, and that money makes more money, yeah,
that's compounding interests. That's where you need to have a
higher stock exposure to enable your investments to actually do
that for you, especially if you're going to retire early
and you have inflation to worry about and a longer
(19:24):
time horizon to pull from the investments. This is not
an article that I agree with.
Speaker 2 (19:29):
If you cannot, yeah, not at all. To your point.
Speaker 1 (19:31):
I have a number of clients who have enough income
and retirement that they're not pulling from those investments whatsoever.
So it would make sense to let it grow. Here's
the all Worth advice. We don't believe in this one
size fits all, and neither should you find yourself a
good financial advisor who can tailor an approach specifically for you. Okay,
just in time for the holidays, We've got some scams
(19:54):
to talk about how to protect yourself.
Speaker 2 (19:55):
Our colleague Bill Shredder is in for that.
Speaker 1 (19:57):
Next, you're listening to Simply Money presented by all Worth
Findinancial Here on fifty five KRC the talk station. You're
listening to Simply Money presented by all Worth Financial.
Speaker 2 (20:09):
I Needy Wagner along with Steve Ruby.
Speaker 1 (20:12):
Tis the season for lots of things right, spending the
holidays and also scammers trying to target you, your family,
your loved ones.
Speaker 2 (20:21):
We have a special treat for you tonight. Joining us
is one of.
Speaker 1 (20:23):
Our colleagues, Bill Schredder, who has a special designation. He
is an expert in how to protect his clients from scams.
And I really want to start with that, Bill, How
did you This isn't a designation that a lot of
financial advisors have. How did you get to the point
of having one?
Speaker 4 (20:42):
Correct?
Speaker 5 (20:42):
Actually, very few financial planners have them. Yeah. I started
doing it simply because I had clients who were being
scammed and I was doing a lot of research for them.
And by the time I was done doing all that research,
I was like, the credential makes sense. Yeah, because unfortunately,
specially people over the age of sixty five, over the
age of sixty But now it's truly everybody. We're all
(21:05):
targets of, you know, people who want to commit fraud,
who want to steal your money.
Speaker 2 (21:10):
Yeah.
Speaker 5 (21:11):
The level of scams out there and how good the
scams are is just improving constantly, and it's very difficult
to detect.
Speaker 4 (21:20):
Yeah, this is one where I imagine the continuing education
is rather important because I feel like criminals that use
this energy of THEIRS for scamming. You know, I don't
have the letters after my name like you do, but
I sure hate these scammers. It's truly a disgusting thing.
CFCs Certified Financial Crime Specialists. I think that's pretty cool.
I know that you wanted to talk about a couple
(21:42):
of scams that are front and center right now as
we transition into the holiday season, specifically a holiday recipe
website fraud where I think somebody in your family actually
fell victim to this.
Speaker 5 (21:53):
Yeah, family and friends. Yeah, and it's happening more and
more often. But what happens is you go to a website.
You're looking up recipe for Thanksgiving, recipe for Christmas, and
you're reading it, no problem, and all of a sudden,
big blaring, you know sound, you know, screeching sound comes
through your your computer telling you you're being hacked. And
(22:14):
it's coming from like, you know, Microsoft Defender or you
know some other sounds like a legitimate name, and it
gives you an eight hundred number to call. And of course,
because basically it's screaming at you, get it gets your attention, panic,
let me let me call. And while you're while you're
talking to a person who stays in character, they're collect
(22:35):
they're collecting all your personal information, and then ultimately they're like, well,
let's send I'll send you a link to access your computer.
And they're talking to you and they're showing you screenshots
of what you know, what's on your computer, but none
of those are real. They have somebody else accessing your computer,
stealing whatever data they can, and meanwhile you're giving them
(22:55):
your personal information, very often credit card numbers, bank account numbers,
I mean, you know, they charge a fee as well
to do this with you. And the unfortunate thing is
is then the next thing, you know, you get off
the phone call, everything seems to be working fine, and
a few days later, your accounts and your credit cards,
you know, and even your computer all of a sudden
(23:16):
is ransomware. Or basically you are you're seeing withdraws, big
withdraws from your accounts.
Speaker 2 (23:22):
And all you were doing was try to look at
a recipe.
Speaker 5 (23:24):
All yeah, because the website is actually fake. What it's
doing is it's showing up in search engines usually you know,
three or four down. It's free, and what happens is,
basically you go to it. It's a neat recipe because
the recipes that are on the site are real. But
the site itself is designed for, you know, for phishing
and forgetting this information from you. And even if ultimately,
(23:48):
you know, they can't get in your computer or they
don't get a lot from you, every data point they
get on you is worth money. This is a business
run by criminal syndicates. You know, your profile and initially
be worth ten dollars to them, that's what they paid
for it.
Speaker 4 (24:03):
They add data to.
Speaker 5 (24:04):
It, like your driver's license number, or your sold security number,
or a credit card or pin number. The more they
add to it, the more valuable your profile becomes, either
for themselves to use or they sell it to another syndicate.
I mean all of us. We're constantly getting these days
emails and text messages from what we think are legitimate sites.
(24:27):
You know it's coming from Amazon. No, it's not.
Speaker 2 (24:30):
Yeah, they just know that.
Speaker 5 (24:32):
Okay, thirty percent of America shops at Amazon, especially the
holiday season. This is a great time to say there's
a problem with your order.
Speaker 2 (24:39):
I've always said.
Speaker 1 (24:40):
That about scammers that wherever there are a lot of
people and wherever there's a lot of money changing hands,
right they're going to figure out a way to be.
Speaker 2 (24:48):
In the middle of that.
Speaker 1 (24:50):
To your point, we're ordering so many packages right now,
We're doing so much holiday shopping. I have my credit
card number memorized after this weekend, just.
Speaker 2 (24:59):
Buying so much.
Speaker 1 (25:01):
What's your advice to people as they're taking off things
on their list, their holiday shopping list, how can they
make sure that they're also protecting their information, their financial information.
Speaker 5 (25:11):
Okay, there are a few things that they can do.
Number one, of course, it's the realization that nobody needs
your full sol Security number. Yes, hey, the IRS is
not going to call you and ask you for your
soul Scurity number if you're already have it. You know
the banks are not going to do the same thing.
So any any text message, any email you get that's
basically a panic telling you you're gonna lose your soul
Security benefit, You're gonna lose your health insurance. There's going
(25:33):
to be a problem with the direct deposit. You know
that is most likely fake creating Urgency Act exactly. So
you know, that's one thing as far as realizing that
the information is not needed. You don't need to give
it to anybody. If someone asks for your PIN number,
hang up on them. The other thing that I recommend
to people is if you're using bank accounts like a
(25:53):
debit card, don't have that debit card connected to an
account that has a lot of money in it. For example,
if I use a debit card on a website it
turns out it's fraudulent. I gave away that number, They're
going to start testing the account. You know, trying to
take a dollar, trying to take five dollars, you know,
ten dollars, one hundred one thousand, ten thousand, especially around
when sold security is due to arrive into your account.
(26:16):
If they know your birthday age, they can they can
predict that. But what happens is people can have like
one hundred thousand dollars or fifty thousand dollars sitting in
their checkbook. No, that can be in a savings account,
disconnected from the account where you're using the debit because
somebody is going to actually, you know, take that money
and you know, yes, it can be recovered by the bank,
(26:36):
but it takes time. Meanwhile, you for next ninety days,
you don't have you don't have actual money to pay
your bills necessarily, So that is you know, that's you know,
that's another thing. The other recommendations I have, which are
common ones, is look at who is sending the message.
If it's coming from Microsoft, coming from the IRS, coming
from your bank, I'm pretty sure they're not using a
(26:58):
Gmail account. It's coming from a Gmail account, then it's
you know, it's not odd when you when you hover
over links, the link will tell you basically what it's
going to. I am pretty sure Microsoft does not use
Google drives. I am pretty sure your Amazon does not
use a Google Drive, so you know then that, okay,
(27:19):
this is not a real link. So when you get
text messages, when you get emails, don't use the links
or the phone numbers that they provide in the email
of the text. Instead, go right to the normal source.
If you call your bank, the bank will have the
record of whatever the issue is, if it's real.
Speaker 2 (27:37):
Uh.
Speaker 5 (27:37):
And again, the I R S does not call people.
They do not text people. You know, you know you
will know if you have a tax problem with the
I R S well in advance of this one of this,
you know, offer to basically settle your tax debt for
ten thousand dollars in gift cards.
Speaker 4 (27:53):
Then gift cards. Yeah, that's that's another thing that people
do it exactly right.
Speaker 1 (27:57):
I got a text earlier today and it's a number
I don't recognize. It's a local number, and it says
I didn't forget about shooting the elf pictures with you, literally.
Speaker 2 (28:07):
Like just random something. And I almost was like who
is this? And I was like, this is obviously a scam.
Speaker 1 (28:12):
And then when you respond to these random tax messages,
then then they know that it's a live numbers. So
something else to keep an eye on. If you're getting taxed,
don't don't respond. It's not it's not funny when you just,
you know, try to mess with them, because then they
know they've got a live number.
Speaker 4 (28:28):
It's really tempting to respond with some kind of a
stupid picture of an else, you know, but don't do it.
Speaker 5 (28:33):
Yeah, and when you call them and when you text
them and all that, they will stay in character.
Speaker 3 (28:37):
You know.
Speaker 5 (28:38):
The people on the other end a good at it.
They're very good at it, and sometimes they're actually almost
prisoners to it. They have to do it. It's not
a moral issue. It's like they're trapped somehow.
Speaker 4 (28:47):
That's terrible.
Speaker 5 (28:48):
Oh you think about it, that whoa, it's you know,
it's a serious issue because you can't just walk away
from a criminal syndicate and think, Okay, I'm just going
to go ahead and they'll let me go. There's a
lot of training that goes into these things. You know,
you have to be very good at at different languages
and basically dialects and all that and.
Speaker 2 (29:08):
Acting on top of it. Yeah, great advice.
Speaker 1 (29:13):
What to keep an eye out for for you, for
your loved ones this holiday season in order to protect
yourself from being scammed. From our good friend Bill Shutter
from right here at all Worth you're listening at Simply
Money here on fifty five KRC, the talk station. You're
listening to Simply Money presented by all Worth Financial. I mean,
you Wagner, along with Steve Ruby, you have a financial question.
(29:35):
It's keeping you up at night. You and your spouse
just can't get on the same page. Well, there's a
red button you can click on while you're listening to
the show. It's right there on the iHeart app. Record
your question. It's coming straight to us.
Speaker 3 (29:46):
You know.
Speaker 1 (29:47):
I think, especially when people get closer to retirement, Steve,
it's this sort of mental of that paycheck is no
longer coming in, and now it is what are my
sources of income going to look at look like in retirement?
And for a lot of people either the idea of
dividends sounds great or in some cases it also makes
(30:08):
a lot of sense.
Speaker 4 (30:09):
Yeah, I mean, there's there's potential for rental properties for income.
There's part time work, there's social security, there's pensions.
Speaker 2 (30:17):
Are those lucky enough to have pensions?
Speaker 4 (30:18):
Sure? Yeah, it's kind of fallen to the wayside here,
but nonetheless, another opportunity for income generation would be dividends.
So that's when corporate corporate profits that you know, companies
pay to shareholders flow through on stock or maybe shares
of me TF or a mutual fund that you own
flow through to you as the investor. This is certainly
(30:41):
another way to generate income in retirement for those that
are freaked out, which many are, about what's going to
happen when you're no longer receiving a paycheck.
Speaker 1 (30:49):
Yeah, these can come in the form of individual companies
like Procter and Gamble, Coca Cola. Right, long time, well
established companies tend to pay dividends, sometimes higher dividends or.
Speaker 2 (31:01):
Dividend paying funds also an option here.
Speaker 1 (31:04):
I think when you're a younger investor not yet retired,
if you have some dividend paying funds, often you don't
even see those dividends. You just reinvest them. You just
kind of go back into the investment. But this becomes
more and more important and in a much more interesting
strategy when you get to retirement and you're actually than
living off of, you know, potentially part of these dividends
(31:27):
as part of your income stream.
Speaker 4 (31:29):
Yeah. So when you own an individual stock for a
well established company like you mentioned, like Coca Cola for example,
it's easy to see what kind of dividend that company
may offer in exchange for owning a share. You know,
these are well established companies that are been paying dividends
for a long time, so there's a way that you
can almost count on it in this roam.
Speaker 2 (31:45):
Really do they go down? Sometimes they do? Sure, you
have to say that General Electric.
Speaker 4 (31:49):
Yeah, exactly, I mean it doesn't a penny. A stock
doesn't have to pay you a dividend.
Speaker 3 (31:54):
Right.
Speaker 4 (31:54):
To be clear, that is not something that has happened.
There is risk involved with this, especially if you're counting
on generating income off of you know, your only source
of income being dividends. This is not something I would recommend.
It is certainly a way to diversify income streams and retirement,
and again with an individual company, stocking can be easy
to see what that's going to be usually with that asterisk.
(32:20):
You know, one that I see a lot of in
this region anyways is Procter and Gamble. For example, a
lot of folks not only have retired there, but they
have family that's retired there and maybe even inherited shares,
and they're sitting in you know, an account just paying
you dividends, but there's also dividend paying funds, high dividend
yield strategies versus you know, more of a growth strategy,
(32:40):
where the high dimendend yield strategy is more often than
not continuing to pay those dividends, whereas the growth one
it's not as well of established of a company that
might not pay dividends, but when it doesn't, you're also
potentially seeing the value of the shares go up.
Speaker 1 (32:56):
As a general rule here and this is very general
company it tend to pay dividends or more value companies. Right,
they are the well established you know, think like not
going to win the race, but you know, always coming
in strong.
Speaker 2 (33:12):
Versus where you might get your growth.
Speaker 3 (33:14):
Right.
Speaker 1 (33:15):
You think about the Magnificent seven, right, the companies that
have really fueled the growth in the S and P
five hundred over the course of the past year. Now
I'm not saying those companies you should be necessarily all
in on those individual companies, but they tend to not
pay any dividends. Why because rather than reinvesting the proceeds
into the investors, they reinvest that money into research and development.
(33:37):
More growth, more growth, right, and so I think it
makes sense to have kind of both as part of
your investment portfolio, not necessarily focusing on one to the other.
Speaker 2 (33:47):
And I agree with you.
Speaker 1 (33:48):
For anyone who's like well, I like to be able
to count on dividends.
Speaker 2 (33:51):
This can be my source of income and retirement.
Speaker 4 (33:54):
Not a great plan, no, I mean, certainly there are
folks out there that are very comfortable and having a
dividend paying portfolio and generating income off of it. But
at the same time, you're potentially giving up capital appreciation. Yeah,
you're giving up the opportunity to be invested in some
of these growth companies where over the long term you're
keeping up with inflation. There's maybe a little bit more
(34:16):
speculation involved that could grow your assets more than just
a portfolio of high dividend paying value company stock. This
is certainly a place that can hold up. It's a
strategy you can hold a place in your overall portfolio
for generating some income. But this isn't something that I
would recommend as your only means of generating income or
(34:38):
what you want to do with your portfolio in its entirety.
Speaker 2 (34:41):
Here's the all worth advice.
Speaker 1 (34:43):
Talk to a financial professional to see if this strategy
can make sense for you, but don't go all in on.
Speaker 2 (34:49):
Any strategy until you've talked to a pro.
Speaker 1 (34:52):
Coming up next December is here and so as a
little Wagner wisdom, that's natural. Listening to Simply Money presented
by all Worth Financial here on fifty five KRC the
talk station.
Speaker 2 (35:08):
You're listening to Simple.
Speaker 1 (35:10):
Money present Am I all Worth Financial. I Meani WAGNERA along.
Speaker 2 (35:12):
With Steve Ruby. For those of you who have.
Speaker 1 (35:15):
Not checked the calendar yet, we are in December.
Speaker 2 (35:19):
You have to know.
Speaker 1 (35:19):
I mean every time you turn on the radio Christmas music,
any stores that you go into Christmas, It's Christmas time everyone.
Speaker 2 (35:25):
We are at the holidays.
Speaker 1 (35:28):
And it allowed me to have some interesting conversations over
the past weekend and really reflect on how much December
and the holidays have become about like consumption in spending
money and listen, I'm not the grinch about this, but
my I sound a little grinchy, but I don't want
you all to feel like a grinch in January when
(35:50):
the credit card bills start to come.
Speaker 2 (35:53):
Yes, I'm helping everyone think ahead.
Speaker 1 (35:56):
Here's why holidays can get bigger and bigger every year
we talk about lifestyle creep, there's holiday creep.
Speaker 2 (36:03):
I think it.
Speaker 1 (36:03):
Happens, and it's like, you know, you kind of make
holidays nicer and nicer every year. Speaking of my own family, right,
We've got I've got nieces and nephews who are now
getting married. We've got boyfriends of my kids that are
part of the gets bigger and bigger and bigger. And
in my parents they buy for everyone and it's just
insanity for them to even keep up with all of it.
Speaker 2 (36:24):
And this year we decided, okay, for the adults, we're
just going to pick a name and buy for each other.
Speaker 1 (36:31):
And we just included our parents in that so that
they're not gone for eight million people.
Speaker 2 (36:36):
And it was a way to.
Speaker 1 (36:37):
Make it a little easier, a little less expensive, and
still make it fun for everyone.
Speaker 4 (36:44):
This is great because I'm sure not everybody in your
family is on the same exact financial wavelength.
Speaker 2 (36:49):
Sure.
Speaker 4 (36:50):
Yeah, So creating a scenario we're not where you're almost
not obligated to spend money on everybody because you just
have that one name can be a very big relief
for some folks in your family, I would imagine here,
And if not your family, then certainly others that would
implement a very similar strategy to what you're doing in
your household and in your family.
Speaker 1 (37:11):
And I was also talking to my best friend on
my way into the office this morning, and she was
talking about the fact that she started Christmas shopping in
October because she wanted to spread it out over three
credit card bills.
Speaker 4 (37:23):
Oh that sounds terrible.
Speaker 2 (37:25):
Okay for you who wait until Christmas Eve to do
your Christmas.
Speaker 4 (37:28):
Shop O day Christmas Eve, come on, give me some
credit Christmas.
Speaker 2 (37:31):
Eve, December twenty third.
Speaker 1 (37:32):
But for those who liked to plan ahead and don't
want the ginormous bill in January, that can also play
out really well. So don't get to December without a plan,
spend like crazy, get to January, can't pay it all off.
And I think experiences rather than stuff I've seen this
year over year every year.
Speaker 2 (37:53):
And I said it to my husband again the other day.
Speaker 1 (37:55):
I was spent all day online shopping for the kids,
and I was like, share, can we just like do.
Speaker 2 (38:00):
Something where there's a memory involved.
Speaker 1 (38:02):
And we're not buying all this little stuff that, by
the way, by the time February rulls around, the've forgotten
about it.
Speaker 4 (38:07):
Anyway, give yourself some credit. You can find something sentimental
that might stick with them and their memories.
Speaker 1 (38:12):
Yeah, well maybe just kind of a middle ground. But
it's easy to get into this holiday season. And just
as seed deals, right, I mean, it's cyber Monday now
and there's everywhere. Every time you get online, there's seventy
five different emails with great deals that you just can't
pass up, and so you just buy bye bye, keep track,
don't let your credit card bill surprise you when it
(38:32):
comes to January. And if it seems to be exorbitant
and it's becoming stressful, have conversations. Be the one to
bring it up in your family. I guarantee if you're
feeling that way, there are there are other people in
your family feeling.
Speaker 2 (38:46):
The same way. Thanks for listening. We hope you're going
to tune in tomorrow.
Speaker 1 (38:49):
We're talking about why just investing in the S and
P five hundred may not be diversified enough. You've been
listening to Simply Money, presented by all Worth Financial here
on fifty five krs the talk station and
Simply Money News
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