Episode Transcript
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Speaker 1 (00:06):
Tonight the connection between the Super Bowl, your money and
your long term plan. You're listening disimply Money presented by
all Worth Financial, I mean Wagner along with Bob Sponseller.
You know, I love a good analogy, And this weekend
is kind of an unofficial national holiday in the form of.
Speaker 2 (00:25):
The Super Bowl. And so as we prepare.
Speaker 3 (00:27):
Are we going to talk about the price of guacamole
and taxes on our FanDuel account? Is that where you're
taking me today?
Speaker 2 (00:34):
We might we might go there.
Speaker 1 (00:35):
I don't know where we're going to go, but I
think there are a lot of similarities between how the
game is played, how you prepare for the game, and
how you might want to look at your own financial situation.
Speaker 3 (00:46):
Why don't you lay it on us?
Speaker 2 (00:48):
Well, first of.
Speaker 1 (00:49):
All, there's a playbook, right, I mean, neither of these
teams is going to come into this game on Sunday
and figure it out when they get there, right, I mean,
they have a plan in place, they know that the
goal is to win, They've figured out their strategies to
do it. And I think we all need a playbook
when it comes to our money. And you know, it
starts with the financial plan what is spending going to
(01:10):
look like when you're in retirement, and what kind of
income are you going to have, what kind of assets
do you need, what kind of investment strategy is it
going to get you there?
Speaker 2 (01:19):
And there's all.
Speaker 1 (01:20):
Different facets to that, just like there's different players on
the field that have different jobs, different roles.
Speaker 3 (01:28):
All right, I see where you're taking this now, so
let's talk. I'm following. I'm following. So all right, well,
let's talk about the first half of the game versus
the second half of the game. Let's, you know, compare.
The first half of the game is like you're working years,
accumulation years, building a savings balance in your retirement plans
and paying off debt and all those good things. And
(01:49):
then the second half is your actual retirement, protecting your
lead in the game, protecting what you've worked all your
life to build, and then avoiding big mistakes like we
talk about all the time.
Speaker 1 (02:02):
I also think when you're talking about first half versus
second half, I'm sitting here listening to you thinking.
Speaker 2 (02:07):
There are some people who are maybe asleep for the
first quarter.
Speaker 1 (02:11):
You know, just not paying attention and kind of jump
in and wake up, and they're like, oh, retirement is
now coming, I should probably jump in. There are ways
that you can catch up. There are ketchup contributors.
Speaker 3 (02:23):
I know, like the Bengals Week one game against the
New England Patriots.
Speaker 2 (02:27):
How about the first few season? Yeah, exactly.
Speaker 1 (02:30):
We kind of slept through the first few games and
then we had to play catch up throughout the season.
It didn't exactly end up working out. And remember it
came down to like the like literally other teams, right,
we didn't have control over our destiny. If you want
to have control over your destiny when it comes to
making it to the playoffs or having the life you
(02:50):
want in retirement, you better take control pretty early.
Speaker 3 (02:53):
This might be a good time for me to interject
having control over Sunday's game as a Bengals fan and
somebody who's tired of Patrick M. Mahomes getting all the
referees calls same, I'm looking forward to somebody just picking
that guy up and body slamming him into the turf
in the first quarter. Let's give him a good pop
and rattle his cage a little bit and see what
(03:15):
happens after that. What do you think, Amy, Yeah, I'm.
Speaker 1 (03:17):
Actually down for anything, but a Chiefs threinded at this
point because I think everyone outside of Kansas City is
kind of done with this outcome.
Speaker 2 (03:26):
We'll see how, you know, it plays out. But listen,
I think one of.
Speaker 1 (03:30):
The great tools that the Chiefs have is they've got
a great team roster. I mean, they've got people who
are really good at what they do at just about
every position on that field.
Speaker 3 (03:40):
Yeah. So, you know, converting that into the financial planning discussion,
you need to have a good tax plan, you need
to have a good insurance plan, you need to have
a diversified investment portfolio. You need to have a diversified,
well thought out income strategy that minimizes the taxes and
all the things that we talk about all you know,
all day long. So it's getting all the right players
(04:02):
on the field, including a good CPA, a good attorney.
So you've got the right players in place who are
actually playing out that playbook and game plan. And the
teams that do that well usually have a great chance
to win the Super Bowl or at least go to
the playoffs.
Speaker 2 (04:18):
Well, and you know, you mentioned taxes.
Speaker 1 (04:20):
I think having that tax strategy is like having good
special teams.
Speaker 2 (04:25):
You know, we've been doing a case study here for
the show.
Speaker 1 (04:28):
And it looked at people who early thirties invested a
million dollars in assets and over the course of you know,
the next thirty five years let it ride and eight
percent return. Of course, they had the same amount when
they got to retirement. But the difference between the two
different investors was one of them had an eye on
tax efficiency, looking at tax alpha, making sure that they
(04:51):
had well diversified tax treatments of how that money was saved,
and making sure that when they got to retirement their
distribution strategy was to be tax efficient.
Speaker 2 (05:01):
What's the difference between the end result for both of them?
Speaker 1 (05:04):
If you got to pick a winner, well, the one
investor with the eye on tax strategies came out six
hundred thousand dollars to the good, essentially winning that team.
You know how many times has as a Bengals fan,
it come down to one kick right, one play making
the difference, you know, for someone getting close to retirement,
(05:26):
the difference maker is often tax planning strategies. How do
you keep as much as possible in your pocket?
Speaker 2 (05:33):
Getting this right.
Speaker 1 (05:34):
Can be the difference of tens in in cases hundreds
of thousands of dollars to the good for you.
Speaker 3 (05:40):
Yeah, and pivoting this back to football. You know, the
teams that usually win these big games are the ones
that could win the game in the trenches, at the
line of scrimmage, offensive line, defensive line, and that just
gets into a good run game. Controlling the run and
investing early is kind of like running the ball consistently
(06:01):
down the field. Get a good plan in place early.
Don't worry about throwing hail mary passes at the end
of the game thinking you're going to pull it out.
Get a fundamental ground game going in those small games
over time, invested the right way in tax efficient strategies
add up to touchdowns, ball control, control the clock, and
(06:23):
run the thing out to victory.
Speaker 1 (06:25):
You're listening to Simply Money presented by all Worth Financial
I Memi Wagner along with Bob spawn saler as we
have a little fun with you going into the weekend,
the big Super Bowl weekend. I think there are a
lot of similarities between how you play football, how you
plan for it, how you play it well, and how
you've got a good kind of financial long term plan
(06:45):
in place for yourself.
Speaker 2 (06:46):
You know, you mentioned kind of hail Mary. I see that.
You know.
Speaker 1 (06:51):
I come across that from time to time, someone who
either hasn't saved or takes on way too much risk
in their portfolio, thinking that's going to be the hail
Mary pass that's going to save everything.
Speaker 2 (07:03):
I maybe even mentioned this to.
Speaker 1 (07:04):
You, But there's a guy that I come into contact
with a couple of times a year, and he's always like,
when he sees me, he makes a b lined to
me because he wants to get my take on whatever.
So earlier this year I ran into him and he said, listen,
I lost my shirt this year.
Speaker 2 (07:19):
I'm like, how'd you.
Speaker 1 (07:19):
Lose your shirt in twenty twenty four? I mean, it
was a banner year for markets. Well, I went all
in on crypto exchanges, okay, And he said, but but
I saw the riding on the wall earlier this year
after I lost so much and I took everything out
of that, and then I went on in on Nvidia
a week.
Speaker 2 (07:38):
And a half ago. I thought of that guy, and I.
Speaker 1 (07:40):
Thought, oh my gosh, it's one hail Mary pass after
another Hail Mary path.
Speaker 2 (07:45):
None of them are going to win the game for him.
Speaker 3 (07:47):
Has he come back to you yet this year and said, Amy,
give me the pick for twenty twenty five to get
all my money back, and then some has that conversation happened.
Speaker 1 (07:57):
Yeah, yeah, I think if he does, I'll be like,
it's this crazy thing called the S and P five hundred.
Speaker 2 (08:01):
Dude being diversified.
Speaker 1 (08:05):
Is it's not sexy, you know, it's not some big
play that might make the highlights on ESPN for the
next five years. It's slow in steady, but I'm telling
you it wins the game.
Speaker 3 (08:17):
I thought you were going to tell him to cash
out his HSA account and put it all on deep seat.
That's what I was expecting.
Speaker 2 (08:24):
Maybe maybe you know.
Speaker 1 (08:26):
I'm also as we're having this conversation, thinking about sometimes
how I go into these games when they're not teams
that I'm particularly interested in, like maybe this week, and
it's like, well, I'm here for the snacks and the
commercials and the halftime show, right like whatever happens in
the game, I'm not really interested in. But I think
(08:46):
the analogy here that I would draw, you know, for
people couples as particularly, who are you know, working together
to get financial goals is there's often someone who is
playing the game who knows the playbook and there's someone
who's just there for the commercials, And the problem is
if that person gets hurt on the field, someone's going
to need to go in right.
Speaker 2 (09:07):
So both of you need to.
Speaker 1 (09:09):
Be on the same page. You both got to know
how to play the game. You both got to know
the playbook in order to really really win yourself.
Speaker 2 (09:18):
A game long term.
Speaker 3 (09:20):
This reminds me of what I used to say at
all my baseball players that I coached for over thirty years,
when we're doing all the boring off season training, the conditioning,
the lifting, and things would get kind of down in
February because we really don't have the bats and balls out,
and I used to stand in front of a fun part. Yeah,
I used to say to them, guys, are you truly
(09:43):
committed or are you merely interested? And that's what usually
separates the week from the chaff right there, because everybody
wants to be there when it's fun and you're putting
the uniforms on and all that, but by that time
it's too late. When you step in the batter's box
and you're not prepared, it's usually not going to be
a very good outcome.
Speaker 2 (10:03):
You don't make it to game day, without putting in
the work.
Speaker 1 (10:05):
No, right, And you know, I think about my son
who's a high school basketball player. Right, the attention that
he puts into making sure he's eating well and sleeping well,
in working out. None of that's fun. It goes on
all year round, not just when he's taken the court
for the basketball game.
Speaker 2 (10:21):
And I think, you know, for many people who.
Speaker 1 (10:23):
I see who are really successful long term money wise,
they understand the stuff and they get it when they're young,
and they put in the work and all of us
and it may not be fun in the beginning, right,
they may not be going to happy hours and the
rest of their friends are because they're putting money into
their four oh one K. But all of a sudden,
at one point they check that four oh one k
balance and it has become real money. It has grown
(10:46):
and it is compounded, just like when you're playing a
sport and all of a sudden you realize, I just
noticed this thing that I used to not be able
to do.
Speaker 2 (10:54):
Now I can do it and do it well, you know,
and I just we're having fun with this. But I
do think there.
Speaker 1 (11:01):
Are so many similarities to the long term planning that
goes into from where you are now to where you
want to get in life. And you know and play
in a sport and play in it well.
Speaker 3 (11:12):
Well, and as you share all that amy the exhibit
A example of what you just talked about is our
good friend that we had the opportunity to speak with yesterday,
mister ed Fink. You look at his career both as
a business owner, as a financial advisor, and just as
a man as a mentor as an example, that's a
(11:33):
guy who has played the game, played for the long
game and all the right things, stuck with the good fundamentals.
And that's one winner of a human being agreed.
Speaker 1 (11:43):
Here's the all Worth advice. A winning retirement requires a
solid playbook, making adjustments along the way, a strong defense,
and so much more. Plan ahead, diversify and protect your
own financial future.
Speaker 2 (11:56):
Coming up next, the staggering.
Speaker 1 (11:58):
Amount of money people are willing to bet on the
super Bowl, plus the Super Bowl champ who will get
an insane amount of money if he decides to sell
us home. You're listening to Simply Money presented by all
Worth Financial here on fifty five krs the talk station.
You're listening to Simply Money presented by all Worth financial
I mean you Wagner along with Bob's bonseller coming up
(12:18):
at six forty three, we're playing a retirement fact or
fiction and we are talking about estate planning. We'll get
to a lot of good stuff. Stick around for that.
What would be the price, right? I mean it's hard
to imagine now because it's been a bit of a
tough season here at the end for the Bengals, But
if they were ever to go back to the Super Bowl,
and I'm hoping they do that soon, Like, would you
(12:41):
be someone who was shopping around for tickets, what would
be the price that you would say? Okay, I'm down
for that.
Speaker 3 (12:47):
I'm seeing ticket prices for Sunday's game currently in a
range between thirty eight hundred dollars to over seven thousand dollars. Amy,
So my question for you is, is that an eligible
deduction on a tax free basis from your HSA account?
If I want to make that happen by Sunday, can
you make.
Speaker 2 (13:05):
The case of all have a heart attack if I'm
not at this.
Speaker 3 (13:08):
Gate, it'll help my mental health.
Speaker 1 (13:11):
I like that. I like the case where I don't
know if the irs would see it the same way
that I do. I was listen as a lifelong Bengals fan.
For anyone else out there, you get this right, the
ups and the lots of downs that have come with us.
I was one hundred percent on my couch a few
years ago when the Bengals were going to the super
Bowl during the playoff game, before staying to my husband,
(13:31):
we need to go, we need to go. And I
looked at actually flights at the time LA and I
was like, Oh, we can do this.
Speaker 2 (13:40):
By the time the game was.
Speaker 1 (13:41):
Over, the cost of flights had tripled. And it came
from a this is a bucket list thing. I think
we should do it to. Okay, this is like a
disruptor of our long term financial plan. I'm not sure
we can actually pull this off. My cousin Jason, he
did go. He I don't know, had some kind of
crazy deal on his ticket, but would love to be
(14:02):
there someday. I think you got to figure out, like,
do I have enough money set aside where I can
check off this bucket listing and not go broken retirement.
Speaker 3 (14:12):
Yeah, let's pivot to gambling yo for guys. Okay, let's
go there for guys like me that really don't enjoy
being out in the masses and the general public and
just like to stay in their controlled environment at home. Yes,
my man cave with my smoked wings and big screen TV. Okay,
one point three to nine billion dollars is expected to
(14:34):
be wagered on the Super Bowl between the Eagles and
Chiefs on Sunday. So, thinking about our good friend Governor
de Wine, you know, if we got all that money
bet in Ohio, that's close to a half a billion dollars,
that would put some roofs on stadiums, dome staate that
that'd be a big boon to our stadium problem here
(14:54):
in Cincinnati.
Speaker 4 (14:55):
One.
Speaker 1 (14:55):
Yeah, right, going back to Governor de Wines plan to say, hey,
let's tax, let's double the tax people are paying on
these sports bets and put those towards stadiums rather than
making taxpayers be on the hug for this. You know,
I'm not a listen, I'm not a gambler at all.
My brother has a really fun Super Bowl party and
a few years ago, I mean he had projected up
on the wall what are they call the vanity.
Speaker 2 (15:17):
Bets or whatever, the crazy bets over.
Speaker 1 (15:19):
Like which commercial is shown first and what flavor of gatorade.
Speaker 2 (15:24):
They're gonna that was fun.
Speaker 1 (15:26):
I did put a few dollars into the hat on
that that was That was a.
Speaker 2 (15:30):
Ton of fun.
Speaker 1 (15:30):
But I think many people just want to bet on
the game, the winners, the losers, how it's all going
to shake out. And I think the interesting thing is
the number one bet on situation sports in all of
sports ball, if you will, is the Super Bowl. March
Madness also a big deal, but you got to think
about that spread out over several weeks. This is one day,
(15:52):
and there is a lot of money going at this game.
Speaker 3 (15:55):
Yeah, and our our good friend Dave Portnoy, the founder
of Barshed Sports, is very unhappy. You know, you want
to talk about some somebody that expresses his thoughts often
on social media. He's he's unhappy that Kansas City is
even in the super Bowl. That's because he bet a
million dollars that Buffalo would beat them and then go
(16:17):
on to win the Super Bowl. So he's blaming the officials,
getting all upset, you know. Yeah, people can go crazy
on this stuff. At one point during the Bills Chiefs game,
he wrote on x that he was quote unquote done
watching football and then proceeded to rip the referees.
Speaker 1 (16:34):
I'm going to bet that mister Portnoy is in fact
watching this game when Sunday comes around.
Speaker 3 (16:39):
Now, is that is that you amy when the first
commercial is for tostitos rather than guacamole dip, you get
that upset over it?
Speaker 1 (16:48):
No, No, honestly, you know I will be around for
the snacks. We will be a good friend's house on Sunday,
but I will be probably more socializing than paying attention
because I really don't like, really in love with either
one of these teams here. But you know, I think
it's interesting because Dave Portnoy bet a million dollars. He
probably has a million dollars to bet, right, But there's
(17:13):
a lot of people out there making bets on this
game that it's not just chump change it, it's you know,
a sizeable amount of what they have.
Speaker 2 (17:20):
Make sure if you.
Speaker 1 (17:21):
Are someone that is into this, totally fine, no shame
on that. Make sure it's not coming out of your
flour one K or instead of a floural one.
Speaker 2 (17:29):
K contribution, right. Make sure that you're keeping an eye
on the long term.
Speaker 1 (17:33):
The end game here not being who wins this game,
but who gets to retire at some point.
Speaker 2 (17:38):
Right, That's that's the difference maker here.
Speaker 3 (17:40):
All right. In other quasi football related news, Amy, talk
to me about your favorite sports figure of all time,
Tom Brady. What's going on in his world?
Speaker 1 (17:51):
Okay, well, a Tom Brady is not my favorite sports person.
Speaker 3 (17:55):
I knew that why I said that.
Speaker 1 (17:57):
But interestingly, some of our good friends live in Tampa,
and so I have been pointed in the general direction
of Tom Brady's home in in the Florida mansion in
that area. It's on some kind of crazy private island,
and he is apparently thinking of selling it. And the
(18:17):
crazy thing is it's not even on the market yet,
but apparently, reportedly, allegedly, there are already bids coming in
as high as one hundred and fifty million dollars for
this property.
Speaker 2 (18:29):
Because you know, what does it have? Will you know?
Speaker 1 (18:31):
Obviously, this former football star needs a pickleball court, basketball court,
a multi car course on his property, a customized golf course,
an outdoor infinity pool, a boat dock, thirteen person security detail.
You know I always think about, you know, kind of
next level wealth. This is like seven levels above my
(18:52):
total comprehension.
Speaker 3 (18:54):
Well, if he gets if he does get one hundred
and fifty million or anything above that, you know, it
would be the largest home sale in the history of Miami, Florida. Yeah,
pretty much dwarfing the current record by hedge fund manager
Ken Griffin, who bought a home for you know, a
paltry one hundred and seven million dollars just three years ago,
(19:14):
in twenty twenty two. So inflation's working for some people, amy.
Speaker 1 (19:19):
You know. I would also say Brady is well diversified, right,
He had some commercials a few years ago. He went
on in some kind of I can't remember what kind
of crypto or whatever exchange he was kind of kind
of pushing, you know. Ultimately he lost a little, but
he is well diversified.
Speaker 3 (19:34):
Enough that he lost more than a little.
Speaker 1 (19:36):
Well yeah, well he lost a lifetime of fortune for
most people, but for him, probably honestly a drop in
the bucket because he is pretty well diversified. Coming up next,
al Wors chief investment Officer Andy steut In to help
unwind a concentrated stock position. If you ever find yourself
in this situation, heads up to all of you Procter
and Gamble stockholders. You're listening to simply money presented by
(19:58):
all Worth Financial here and fifty five KRC The toxation.
Speaker 2 (20:06):
You're listening to.
Speaker 1 (20:06):
Simply Money, presented by all wad Financial. I Meani Wagner
along with Bob spawondseller in the Cincinnati area. We often
come across investors who have a concentrated position, so think
a lot of stock in particular companies. Right, We've got
some great, big, strong, hometown companies that we believe in.
Speaker 2 (20:30):
I'm just gonna throw.
Speaker 1 (20:31):
Procter and Gamble out there, because man, do I see
it all the time. But you know, I think over
the past couple of years, we've seen people fall in
love with tech companies. I have a client who has
a large position in Amazon right now, and so this
is something we see all the time. And the problem
is when that company is doing great, so are you.
(20:51):
And when the company is not doing so great, you're
not sleeping at night. So if this is a situation
that you are in, right, we see investors in this
all the time. We are joined by Andy Stout, our
chief investment officer, for kind of a news series that
we're starting here on the show Investor Solutions.
Speaker 3 (21:08):
Right.
Speaker 2 (21:08):
If this is.
Speaker 1 (21:09):
Something that's you're in this boat, how do you handle it? So, Andy,
this is not something new to you whatsoever. You know,
We've got lots of clients here at all Worth that
come to us in this situation. Let's talk about the
conversations that we're having with them. If someone is coming
to us with a lot of stock, right a lot
(21:30):
of their portfolio exists in one particular company, how can
we help them diversify.
Speaker 4 (21:35):
That in many ways? I mean Procter and Gamble is
a classic example. I mean you mentioned them, you know,
at the top here, and if you look at where
Procter and Gamble, if you go back, you know, ten
years ago, it was around forty dollars a share, which is,
you know, pretty insignificant compared to you know where it's
(21:56):
trading at the day. And so you have these gains
build up right now. Well, many people want to know, Okay,
how can I protect my gains or how can I
reduce my exposure without having a large tax bill? And
these are real concerns, and Amy and Bobby you're seeing
them all the time because one thing that pretty much
(22:16):
every single person at least that I know, can rally
around is, you know, let's pay lesson taxes. Or how
can we you know, not pay so much to the
I R R s so that if.
Speaker 3 (22:27):
Well, people love that dividend too. Andy, Yeah, the dividends
a good thing.
Speaker 4 (22:32):
You don't want to give that up, but you probably
rather you know, not pay Uncle Sam more than uh
more than you have to.
Speaker 3 (22:40):
So how do we do that? Right?
Speaker 4 (22:43):
So one thing, when you think about that, it's not
just about paying lesson taxes, because ultimately it's not necessarily
about reducing how many shares you have, but it could
also be about minimizing the risk you have there. So
when you think about it, yeah, we can you know,
have a predetermined ways to exit a position in a
(23:05):
tax efficient manner. Another thing that we can do, or
you know, an advisor can do, is essentially make that
single risk more market wide risks. So instead of having
exposure to one stock and which could you know, be
very volatile, could go who knows where, maybe we can
(23:26):
transfer that risk from a single stock to the broad market.
So there are quite a few ways that we can
handle that as well. So what I'll first talk about is,
you know, how an advisor can actually reduce the number
of shares in a tax efficient manner. So when you
think about that. There's a quite a few ways to
do it. The one of the more you know, one
(23:49):
of the easier ones to do, Amy and Bob is
if you have someone who happens to be charitably inclined,
the easiest thing you can do is donate that. So
this could be like a through a owner advice fund
or you know some other you know mechanism that you
can essentially donate a portion of that stock, because if
you're going to donate money anyway, why not just donate
(24:11):
the appreciated stock. There you're essentially eliminating any sort of
tax exposure from that donation and reducing or increasing your
overall tax basis and lowering your future taxes. So we
got donations. That's a really important one that I think
it's overlooked a lot, right. The second one is creating
a plan to exit out of the position over a
(24:35):
period of time through aggressive tax losce harvesting. And there
are certain ways that companies and advisors can help with this,
certain types of programs that essentially generate losses and take
those losses to offset gains in other areas. So, you know,
we can do this through programs, you know, by tax
(24:57):
smart trading as an example, where you look to look
for losses in other positions and then you know sell those,
but in order to not reduce your overall exposure, maybe
you go into something similar but not identical for I
R S reasons obviously, that allows you to maintain your
overall exposure, bank those losses and use those to offset
(25:19):
gains on the individual stock.
Speaker 3 (25:21):
A big thing with the with the charitable giving that
I don't think you mentioned, is just a reminder that
you get you get a tax deduction for the full
fair market value of the stock that you give away
to your donor advice fund or charity or chosen charity.
Speaker 4 (25:36):
Right, Andy, It's just like it's just like donating cash
in the same amount, and you can definitely have that
deduction on top of that. So it's a it's a
really good way to essentially help others while also helping yourself.
Now you we talked about ways to reduce your tax
exposure by actually exiting out of the shares. Now when
(25:57):
we think about, well, maybe you want to keep the stock,
but you want to reduce your overall exposure.
Speaker 1 (26:02):
I'm glad you're making that point, Andy, I'm glad we're
talking about this, because you know, we can't make our
investors right, even though we're saying like, hey, maybe being.
Speaker 2 (26:13):
Diversified is better.
Speaker 1 (26:15):
Lots of people have very strong, even sometimes emotional ties
to companies. Maybe it's my grandfather bought this stock said
you know, you know they they willed it to me
and told me never to sell it. Like I've heard,
I've heard every story on the spectrum about why someone
needs to keep, you know, a position in a certain company,
(26:36):
and so how then can we help kind of protect
them against themselves at that point.
Speaker 4 (26:42):
Yeah, there's a couple of ways that we can do this.
One of the more common ways is using stock options. Now,
stock options can be complicated, so you definitely want to
make sure that you fully understand, you know what you're doing.
But one way that you can essentially reduce your risk
while also you know, keeping that's keeping the underlying stock
(27:04):
is you know, employing without going into the weeds, I'll
call an exchange fund replication strategy. So using stock options,
which are calls in puts, you can essentially mimic an
underlying index like an S and P five hundred, and
at the same time you can offset all of the
risk of the stock going up or down doing what's
(27:27):
called a caller. And again you want to have a
long conversation with an advisor about this because stock callers
and stock options can be a pretty pretty complicated to
fully understand without going into the weeds. So that's one
thing that you can use as stock options do so
maintain that Procter and gamble position, uh, but eliminate that
(27:50):
company specific risk. And you don't have to use just
stock options for that. You can also use some other
strategies that are out there, but stock options are probably
one of the more well known ones to in order
to maintain your exposure.
Speaker 1 (28:06):
Andy, these are the conversations we're having in our offices
day in and day out. Right, someone coming to us
with a large part of their portfolio in one individual
company and one individual stock, you know, so we're having
these conversations, how do you mitigate this risk? What are
your options? Very much appreciate your insights on how best
to handle this. You're listening to Simply Money presented by
(28:28):
all Worth Financial here in fifty five KRC the talk station.
We're listening to Simply Money presented by all Worth Financial
and Memi Wagner along with Bob spond Sell, do you
have a financial question you can't figure out on your own.
There's a red button you can click them while you're
listening to the show. It's right there on the iHeart app.
(28:48):
Record your question. It's coming straight to us and it
is time to play retirement fact or fiction, and we're
really focusing in on estate planning right now. For step
fact or fiction, mister spond Seller, medical debt does not
pass to your heirs, to your loved ones, unless they
either co signed or are otherwise legally legally responsible for it.
Speaker 3 (29:10):
In almost every case, that is a fact. Does not
pass down to your airs now right. Yeah, it does
pass to your surviving spouse though, yeah so, but yeah
hopefully Well, very difficult topic to talk about, but fact
it does not pass down two kids.
Speaker 1 (29:28):
And this can get really tricky. I know of kind
of some some family friends. There was a situation where
they had had a major medical debt.
Speaker 2 (29:36):
He passed away.
Speaker 1 (29:38):
There's a condo that actually ended up getting willed to
the kids. But there's so much up in the air
because the medical debt situation with a surviving spouse is
not taken care of yet. Uh, And it leaves a
lot less than to the children. So you know, just
I think important to understand how these things work.
Speaker 2 (29:56):
Next, fact or fiction.
Speaker 1 (29:59):
Married couples, you don't need separate wills or estate plans.
Speaker 2 (30:04):
I'll answer this one.
Speaker 1 (30:06):
Part of this is factual and part of it is fiction.
You can use the same will or trust and have
all of your assets flow through that together as long
as it's set up properly. But what you do need
that's different in an estate plan is your own powers
of attorney, your own healthcare directives. You might have very
(30:26):
different thoughts on what you want to happen to you.
If you can't speak up to a doctor, then maybe
what your spouse would want. So it's important to think
through these things and have separate documents for those kinds
of things exactly.
Speaker 3 (30:39):
And I see this happen all the time, Amy, I mean,
I ask folks that come in and they have had
complex estate plans done, they've talked through everything, and when
I ask them about powers of attorney, they look at
me like a deer in the headlights. And you know,
we all know when we go into the hospital, that's
the first thing they ask for. Yep, you know, do
you have a health care directive and you know where
(31:02):
is it. So to your point, each spouse should should
know what they want and have a healthcare directive. And
these are not expensive, complex documents in most states, they're
just boilerplate documents.
Speaker 2 (31:15):
So you can get online.
Speaker 3 (31:16):
Yeah, but you just kind of tell them what you want.
Speaker 1 (31:19):
Yeah, I think it's important to be clear on these
and also make sure that they're updated regularly. Next factor fiction,
if you're moving to a different state, your existing estate
plan will still remain valid and compliant and you'll have
no issues whatsoever.
Speaker 3 (31:35):
I'm going to say fiction on this one. And again
I this is where I always love to get the
client's attorney involved as somebody actually moves in sometimes and
depending on which document you know, a trust for example,
it's going to work just fine. But I always want
to have the client's attorney read through these documents and
(31:56):
make sure they are valid in the state in which
they live. Am I mean one of the services we're
able to provide here at all Worth is we do
have a great team of estate planning attorneys on staff
who will do that. And gosh, we're operating in so
many states across the country. Now, we've got our attorneys
are well versed in this, and this is something that
(32:16):
you should take advantage of to have that reviewed.
Speaker 1 (32:18):
Yeah, there's community property states, there's common law states. There's
different treatments of property and things in different states. So
I think it's worth just another set of eyeballs when
you get to that new state, looking at it from
how things operate there.
Speaker 2 (32:33):
Factor fiction.
Speaker 1 (32:34):
Estate planning can help maximize or minimize taxes and fees
for your airs.
Speaker 3 (32:40):
Fact fact fact. And again this gets into proactive tax planning.
I'll just throw out one example. A lot of times
we have clients who are charitably inclined. It's way more
tax efficient to leave iras to your charities of choice.
Because you completely avoid all the income taxes and leave
(33:02):
your taxable accounts to your kids. You get a stepped
up cost basis the taxes go away. It's a beautiful thing,
but you've got to do the planning in advance.
Speaker 1 (33:11):
Yeah, I think it's really important. And you know, we
just saw some research on this. It showed how long,
first of all, it can take for an estate to
go through probate.
Speaker 2 (33:21):
I mean it can be close to years.
Speaker 1 (33:23):
It can be expensive for your loved ones, it can
be lots of headaches, and then ultimately you don't have control.
Speaker 2 (33:30):
Obviously you're gone, but.
Speaker 1 (33:32):
Things could end up in a way that you've never
intended them to, when someone outside of your family who's
never even met you, as making decisions about what happens
to everything that you've worked so hard to gain during
your lifetime. So it's really really important to have proper
estate planning set up. I know many many people I
talked to are like, you know, I know I need
(33:52):
to do it. I just don't want to do it.
I don't like thinking about it. This is an act
of love for your loved ones. Please ease make sure
you've got the proper estate planning setup. Coming up next,
we're taking you inside Bob's world of wealth. You're listening
to Simply Money presented by all Worth Financial here on
fifty five KRC the talk station. You're listening to Simply
(34:20):
Money present by all Worth Financial. I mean you Wagner
along with Bob's spond seller.
Speaker 2 (34:24):
How many years have you been an advisor?
Speaker 1 (34:26):
Now?
Speaker 3 (34:27):
Thirty four?
Speaker 2 (34:28):
Thirty four years of.
Speaker 3 (34:30):
I'm old Amy, thanks for ash.
Speaker 1 (34:33):
I am calling you experience, and I'm saying you are
bringing thirty four years of experience to the microphone now
nowaday nice when you're here with us, you like me
even more now, and so you know from your wealth
of experience, you've got some wisdom to share.
Speaker 3 (34:49):
All right, Tonight, we're going to talk about qualified charitable distributions.
And this is a topic that I come across all
the time, or should come across all the time, and
I rema, I remain kind of shocked and surprised that
more folks over the age of seventy and a half
have never heard of this number one and are not
(35:09):
taking advantage of it. Number two. So let's get into it.
A qualified charitable distribution is a provision in the tax
code for folks that are over seventy and a half
years old. We're up to one hundred thousand dollars a year.
They can leave ira assets directly to a chosen charity
and completely avoid the taxes on that gift. It's a
(35:33):
wonderful planning opportunity. Unfortunately, we're finding that a lot of
these folks are still you know, putting the check in
the offering plate at church or you know, what have you.
And you know, with the standard deduction as high as
it is now, most people are not getting any tax
benefit from their regular tithing to their church or gifts
(35:53):
to charity. Now, yeah, you can't. And so especially as
we get into age seventy three and above where you
have to take money out of your IRA every year,
this is a wonderful planning tool. And I just tell people,
we got to have a paradigm shift here. Stop writing
the check to your church. Let us do these gifts
(36:16):
for you. You tell us, tell me how much you
want to give to each charity every year, and we'll
take care of that for you. And then that comes
off the top of your taxable income. It doesn't count,
and it brings the tax bill down significantly. Now, a
couple of caveats here. You cannot make a charitable qualified
(36:37):
charitable distribution from a four to one game plan. You
cannot do that. So that's one other one of many
benefits to doing that rollover and moving it into an
IRA that you could control. And then number two, and
I learned this the hard way a couple of years ago.
You cannot make a qualified charitable distribution to a donor
(36:58):
advice fund. It has to go directly to the chosen charity.
So there's my words of wisdom tonight. If you've got
parents who are over seventy and a half, or if
you are over seventy and a half, make sure you
are talking to your advisor about this, because this is
a wonderful tech savings opportunity.
Speaker 1 (37:19):
My clients who are you know, usually in the year
before they have to do R and d's right required
minimum distributions either from their tax deferred ires or four
O one k's. There's like a nervousness about it. Right,
this is a new thing. We've never had to do
this before. We often will look at their plan and
I'll see that there's a charitable giving already in it,
(37:39):
and I'm like, okay, we can just marry these two things. Right,
You can continue to have the same impact on your
church or a charity that you love. You are already
nervous about the taxes that you are going to have
to pay on money you didn't need to pull out
because you're doing just fine.
Speaker 2 (37:56):
We can go ahead and then just give.
Speaker 1 (37:58):
That distribution straight that church or that charity no taxes.
And it's like light bulb moment, like wow, like it's
almost magic, Like I didn't know that that was an option.
So you can be really tax efficient and still have
the same impact on organizations that you love.
Speaker 2 (38:16):
Thanks for listening.
Speaker 1 (38:16):
You've been listening to Simply Money, presented by all Worth
Financial here in fifty five KRC, the talk station
Tonight the connection between the Super Bowl, your money and
your long term plan. You're listening disimply Money presented by
all Worth Financial, I mean Wagner along with Bob Sponseller.
You know, I love a good analogy, And this weekend
is kind of an unofficial national holiday in the form of.
Speaker 2 (00:25):
The Super Bowl. And so as we prepare.
Speaker 3 (00:27):
Are we going to talk about the price of guacamole
and taxes on our FanDuel account? Is that where you're
taking me today?
Speaker 2 (00:34):
We might we might go there.
Speaker 1 (00:35):
I don't know where we're going to go, but I
think there are a lot of similarities between how the
game is played, how you prepare for the game, and
how you might want to look at your own financial situation.
Speaker 3 (00:46):
Why don't you lay it on us?
Speaker 2 (00:48):
Well, first of.
Speaker 1 (00:49):
All, there's a playbook, right, I mean, neither of these
teams is going to come into this game on Sunday
and figure it out when they get there, right, I mean,
they have a plan in place, they know that the
goal is to win, They've figured out their strategies to
do it. And I think we all need a playbook
when it comes to our money. And you know, it
starts with the financial plan what is spending going to
(01:10):
look like when you're in retirement, and what kind of
income are you going to have, what kind of assets
do you need, what kind of investment strategy is it
going to get you there?
Speaker 2 (01:19):
And there's all.
Speaker 1 (01:20):
Different facets to that, just like there's different players on
the field that have different jobs, different roles.
Speaker 3 (01:28):
All right, I see where you're taking this now, so
let's talk. I'm following. I'm following. So all right, well,
let's talk about the first half of the game versus
the second half of the game. Let's, you know, compare.
The first half of the game is like you're working years,
accumulation years, building a savings balance in your retirement plans
and paying off debt and all those good things. And
(01:49):
then the second half is your actual retirement, protecting your
lead in the game, protecting what you've worked all your
life to build, and then avoiding big mistakes like we
talk about all the time.
Speaker 1 (02:02):
I also think when you're talking about first half versus
second half, I'm sitting here listening to you thinking.
Speaker 2 (02:07):
There are some people who are maybe asleep for the
first quarter.
Speaker 1 (02:11):
You know, just not paying attention and kind of jump
in and wake up, and they're like, oh, retirement is
now coming, I should probably jump in. There are ways
that you can catch up. There are ketchup contributors.
Speaker 3 (02:23):
I know, like the Bengals Week one game against the
New England Patriots.
Speaker 2 (02:27):
How about the first few season? Yeah, exactly.
Speaker 1 (02:30):
We kind of slept through the first few games and
then we had to play catch up throughout the season.
It didn't exactly end up working out. And remember it
came down to like the like literally other teams, right,
we didn't have control over our destiny. If you want
to have control over your destiny when it comes to
making it to the playoffs or having the life you
(02:50):
want in retirement, you better take control pretty early.
Speaker 3 (02:53):
This might be a good time for me to interject
having control over Sunday's game as a Bengals fan and
somebody who's tired of Patrick M. Mahomes getting all the
referees calls same, I'm looking forward to somebody just picking
that guy up and body slamming him into the turf
in the first quarter. Let's give him a good pop
and rattle his cage a little bit and see what
(03:15):
happens after that. What do you think, Amy, Yeah, I'm.
Speaker 1 (03:17):
Actually down for anything, but a Chiefs threinded at this
point because I think everyone outside of Kansas City is
kind of done with this outcome.
Speaker 2 (03:26):
We'll see how, you know, it plays out. But listen,
I think one of.
Speaker 1 (03:30):
The great tools that the Chiefs have is they've got
a great team roster. I mean, they've got people who
are really good at what they do at just about
every position on that field.
Speaker 3 (03:40):
Yeah. So, you know, converting that into the financial planning discussion,
you need to have a good tax plan, you need
to have a good insurance plan, you need to have
a diversified investment portfolio. You need to have a diversified,
well thought out income strategy that minimizes the taxes and
all the things that we talk about all you know,
all day long. So it's getting all the right players
(04:02):
on the field, including a good CPA, a good attorney.
So you've got the right players in place who are
actually playing out that playbook and game plan. And the
teams that do that well usually have a great chance
to win the Super Bowl or at least go to
the playoffs.
Speaker 2 (04:18):
Well, and you know, you mentioned taxes.
Speaker 1 (04:20):
I think having that tax strategy is like having good
special teams.
Speaker 2 (04:25):
You know, we've been doing a case study here for
the show.
Speaker 1 (04:28):
And it looked at people who early thirties invested a
million dollars in assets and over the course of you know,
the next thirty five years let it ride and eight
percent return. Of course, they had the same amount when
they got to retirement. But the difference between the two
different investors was one of them had an eye on
tax efficiency, looking at tax alpha, making sure that they
(04:51):
had well diversified tax treatments of how that money was saved,
and making sure that when they got to retirement their
distribution strategy was to be tax efficient.
Speaker 2 (05:01):
What's the difference between the end result for both of them?
Speaker 1 (05:04):
If you got to pick a winner, well, the one
investor with the eye on tax strategies came out six
hundred thousand dollars to the good, essentially winning that team.
You know how many times has as a Bengals fan,
it come down to one kick right, one play making
the difference, you know, for someone getting close to retirement,
(05:26):
the difference maker is often tax planning strategies. How do
you keep as much as possible in your pocket?
Speaker 2 (05:33):
Getting this right.
Speaker 1 (05:34):
Can be the difference of tens in in cases hundreds
of thousands of dollars to the good for you.
Speaker 3 (05:40):
Yeah, and pivoting this back to football. You know, the
teams that usually win these big games are the ones
that could win the game in the trenches, at the
line of scrimmage, offensive line, defensive line, and that just
gets into a good run game. Controlling the run and
investing early is kind of like running the ball consistently
(06:01):
down the field. Get a good plan in place early.
Don't worry about throwing hail mary passes at the end
of the game thinking you're going to pull it out.
Get a fundamental ground game going in those small games
over time, invested the right way in tax efficient strategies
add up to touchdowns, ball control, control the clock, and
(06:23):
run the thing out to victory.
Speaker 1 (06:25):
You're listening to Simply Money presented by all Worth Financial
I Memi Wagner along with Bob spawn saler as we
have a little fun with you going into the weekend,
the big Super Bowl weekend. I think there are a
lot of similarities between how you play football, how you
plan for it, how you play it well, and how
you've got a good kind of financial long term plan
(06:45):
in place for yourself.
Speaker 2 (06:46):
You know, you mentioned kind of hail Mary. I see that.
You know.
Speaker 1 (06:51):
I come across that from time to time, someone who
either hasn't saved or takes on way too much risk
in their portfolio, thinking that's going to be the hail
Mary pass that's going to save everything.
Speaker 2 (07:03):
I maybe even mentioned this to.
Speaker 1 (07:04):
You, But there's a guy that I come into contact
with a couple of times a year, and he's always like,
when he sees me, he makes a b lined to
me because he wants to get my take on whatever.
So earlier this year I ran into him and he said, listen,
I lost my shirt this year.
Speaker 2 (07:19):
I'm like, how'd you.
Speaker 1 (07:19):
Lose your shirt in twenty twenty four? I mean, it
was a banner year for markets. Well, I went all
in on crypto exchanges, okay, And he said, but but
I saw the riding on the wall earlier this year
after I lost so much and I took everything out
of that, and then I went on in on Nvidia
a week.
Speaker 2 (07:38):
And a half ago. I thought of that guy, and I.
Speaker 1 (07:40):
Thought, oh my gosh, it's one hail Mary pass after
another Hail Mary path.
Speaker 2 (07:45):
None of them are going to win the game for him.
Speaker 3 (07:47):
Has he come back to you yet this year and said, Amy,
give me the pick for twenty twenty five to get
all my money back, and then some has that conversation happened.
Speaker 1 (07:57):
Yeah, yeah, I think if he does, I'll be like,
it's this crazy thing called the S and P five hundred.
Speaker 2 (08:01):
Dude being diversified.
Speaker 1 (08:05):
Is it's not sexy, you know, it's not some big
play that might make the highlights on ESPN for the
next five years. It's slow in steady, but I'm telling
you it wins the game.
Speaker 3 (08:17):
I thought you were going to tell him to cash
out his HSA account and put it all on deep seat.
That's what I was expecting.
Speaker 2 (08:24):
Maybe maybe you know.
Speaker 1 (08:26):
I'm also as we're having this conversation, thinking about sometimes
how I go into these games when they're not teams
that I'm particularly interested in, like maybe this week, and
it's like, well, I'm here for the snacks and the
commercials and the halftime show, right like whatever happens in
the game, I'm not really interested in. But I think
(08:46):
the analogy here that I would draw, you know, for
people couples as particularly, who are you know, working together
to get financial goals is there's often someone who is
playing the game who knows the playbook and there's someone
who's just there for the commercials, And the problem is
if that person gets hurt on the field, someone's going
to need to go in right.
Speaker 2 (09:07):
So both of you need to.
Speaker 1 (09:09):
Be on the same page. You both got to know
how to play the game. You both got to know
the playbook in order to really really win yourself.
Speaker 2 (09:18):
A game long term.
Speaker 3 (09:20):
This reminds me of what I used to say at
all my baseball players that I coached for over thirty years,
when we're doing all the boring off season training, the conditioning,
the lifting, and things would get kind of down in
February because we really don't have the bats and balls out,
and I used to stand in front of a fun part. Yeah,
I used to say to them, guys, are you truly
(09:43):
committed or are you merely interested? And that's what usually
separates the week from the chaff right there, because everybody
wants to be there when it's fun and you're putting
the uniforms on and all that, but by that time
it's too late. When you step in the batter's box
and you're not prepared, it's usually not going to be
a very good outcome.
Speaker 2 (10:03):
You don't make it to game day, without putting in
the work.
Speaker 1 (10:05):
No, right, And you know, I think about my son
who's a high school basketball player. Right, the attention that
he puts into making sure he's eating well and sleeping well,
in working out. None of that's fun. It goes on
all year round, not just when he's taken the court
for the basketball game.
Speaker 2 (10:21):
And I think, you know, for many people who.
Speaker 1 (10:23):
I see who are really successful long term money wise,
they understand the stuff and they get it when they're young,
and they put in the work and all of us
and it may not be fun in the beginning, right,
they may not be going to happy hours and the
rest of their friends are because they're putting money into
their four oh one K. But all of a sudden,
at one point they check that four oh one k
balance and it has become real money. It has grown
(10:46):
and it is compounded, just like when you're playing a
sport and all of a sudden you realize, I just
noticed this thing that I used to not be able
to do.
Speaker 2 (10:54):
Now I can do it and do it well, you know,
and I just we're having fun with this. But I
do think there.
Speaker 1 (11:01):
Are so many similarities to the long term planning that
goes into from where you are now to where you
want to get in life. And you know and play
in a sport and play in it well.
Speaker 3 (11:12):
Well, and as you share all that amy the exhibit
A example of what you just talked about is our
good friend that we had the opportunity to speak with yesterday,
mister ed Fink. You look at his career both as
a business owner, as a financial advisor, and just as
a man as a mentor as an example, that's a
(11:33):
guy who has played the game, played for the long
game and all the right things, stuck with the good fundamentals.
And that's one winner of a human being agreed.
Speaker 1 (11:43):
Here's the all Worth advice. A winning retirement requires a
solid playbook, making adjustments along the way, a strong defense,
and so much more. Plan ahead, diversify and protect your
own financial future.
Speaker 2 (11:56):
Coming up next, the staggering.
Speaker 1 (11:58):
Amount of money people are willing to bet on the
super Bowl, plus the Super Bowl champ who will get
an insane amount of money if he decides to sell
us home. You're listening to Simply Money presented by all
Worth Financial here on fifty five krs the talk station.
You're listening to Simply Money presented by all Worth financial
I mean you Wagner along with Bob's bonseller coming up
(12:18):
at six forty three, we're playing a retirement fact or
fiction and we are talking about estate planning. We'll get
to a lot of good stuff. Stick around for that.
What would be the price, right? I mean it's hard
to imagine now because it's been a bit of a
tough season here at the end for the Bengals, But
if they were ever to go back to the Super Bowl,
and I'm hoping they do that soon, Like, would you
(12:41):
be someone who was shopping around for tickets, what would
be the price that you would say? Okay, I'm down
for that.
Speaker 3 (12:47):
I'm seeing ticket prices for Sunday's game currently in a
range between thirty eight hundred dollars to over seven thousand dollars. Amy,
So my question for you is, is that an eligible
deduction on a tax free basis from your HSA account?
If I want to make that happen by Sunday, can
you make.
Speaker 2 (13:05):
The case of all have a heart attack if I'm
not at this.
Speaker 3 (13:08):
Gate, it'll help my mental health.
Speaker 1 (13:11):
I like that. I like the case where I don't
know if the irs would see it the same way
that I do. I was listen as a lifelong Bengals fan.
For anyone else out there, you get this right, the
ups and the lots of downs that have come with us.
I was one hundred percent on my couch a few
years ago when the Bengals were going to the super
Bowl during the playoff game, before staying to my husband,
(13:31):
we need to go, we need to go. And I
looked at actually flights at the time LA and I
was like, Oh, we can do this.
Speaker 2 (13:40):
By the time the game was.
Speaker 1 (13:41):
Over, the cost of flights had tripled. And it came
from a this is a bucket list thing. I think
we should do it to. Okay, this is like a
disruptor of our long term financial plan. I'm not sure
we can actually pull this off. My cousin Jason, he
did go. He I don't know, had some kind of
crazy deal on his ticket, but would love to be
(14:02):
there someday. I think you got to figure out, like,
do I have enough money set aside where I can
check off this bucket listing and not go broken retirement.
Speaker 3 (14:12):
Yeah, let's pivot to gambling yo for guys. Okay, let's
go there for guys like me that really don't enjoy
being out in the masses and the general public and
just like to stay in their controlled environment at home. Yes,
my man cave with my smoked wings and big screen TV. Okay,
one point three to nine billion dollars is expected to
(14:34):
be wagered on the Super Bowl between the Eagles and
Chiefs on Sunday. So, thinking about our good friend Governor
de Wine, you know, if we got all that money
bet in Ohio, that's close to a half a billion dollars,
that would put some roofs on stadiums, dome staate that
that'd be a big boon to our stadium problem here
(14:54):
in Cincinnati.
Speaker 4 (14:55):
One.
Speaker 1 (14:55):
Yeah, right, going back to Governor de Wines plan to say, hey,
let's tax, let's double the tax people are paying on
these sports bets and put those towards stadiums rather than
making taxpayers be on the hug for this. You know,
I'm not a listen, I'm not a gambler at all.
My brother has a really fun Super Bowl party and
a few years ago, I mean he had projected up
on the wall what are they call the vanity.
Speaker 2 (15:17):
Bets or whatever, the crazy bets over.
Speaker 1 (15:19):
Like which commercial is shown first and what flavor of gatorade.
Speaker 2 (15:24):
They're gonna that was fun.
Speaker 1 (15:26):
I did put a few dollars into the hat on
that that was That was a.
Speaker 2 (15:30):
Ton of fun.
Speaker 1 (15:30):
But I think many people just want to bet on
the game, the winners, the losers, how it's all going
to shake out. And I think the interesting thing is
the number one bet on situation sports in all of
sports ball, if you will, is the Super Bowl. March
Madness also a big deal, but you got to think
about that spread out over several weeks. This is one day,
(15:52):
and there is a lot of money going at this game.
Speaker 3 (15:55):
Yeah, and our our good friend Dave Portnoy, the founder
of Barshed Sports, is very unhappy. You know, you want
to talk about some somebody that expresses his thoughts often
on social media. He's he's unhappy that Kansas City is
even in the super Bowl. That's because he bet a
million dollars that Buffalo would beat them and then go
(16:17):
on to win the Super Bowl. So he's blaming the officials,
getting all upset, you know. Yeah, people can go crazy
on this stuff. At one point during the Bills Chiefs game,
he wrote on x that he was quote unquote done
watching football and then proceeded to rip the referees.
Speaker 1 (16:34):
I'm going to bet that mister Portnoy is in fact
watching this game when Sunday comes around.
Speaker 3 (16:39):
Now, is that is that you amy when the first
commercial is for tostitos rather than guacamole dip, you get
that upset over it?
Speaker 1 (16:48):
No, No, honestly, you know I will be around for
the snacks. We will be a good friend's house on Sunday,
but I will be probably more socializing than paying attention
because I really don't like, really in love with either
one of these teams here. But you know, I think
it's interesting because Dave Portnoy bet a million dollars. He
probably has a million dollars to bet, right, But there's
(17:13):
a lot of people out there making bets on this
game that it's not just chump change it, it's you know,
a sizeable amount of what they have.
Speaker 2 (17:20):
Make sure if you.
Speaker 1 (17:21):
Are someone that is into this, totally fine, no shame
on that. Make sure it's not coming out of your
flour one K or instead of a floural one.
Speaker 2 (17:29):
K contribution, right. Make sure that you're keeping an eye
on the long term.
Speaker 1 (17:33):
The end game here not being who wins this game,
but who gets to retire at some point.
Speaker 2 (17:38):
Right, That's that's the difference maker here.
Speaker 3 (17:40):
All right. In other quasi football related news, Amy, talk
to me about your favorite sports figure of all time,
Tom Brady. What's going on in his world?
Speaker 1 (17:51):
Okay, well, a Tom Brady is not my favorite sports person.
Speaker 3 (17:55):
I knew that why I said that.
Speaker 1 (17:57):
But interestingly, some of our good friends live in Tampa,
and so I have been pointed in the general direction
of Tom Brady's home in in the Florida mansion in
that area. It's on some kind of crazy private island,
and he is apparently thinking of selling it. And the
(18:17):
crazy thing is it's not even on the market yet,
but apparently, reportedly, allegedly, there are already bids coming in
as high as one hundred and fifty million dollars for
this property.
Speaker 2 (18:29):
Because you know, what does it have? Will you know?
Speaker 1 (18:31):
Obviously, this former football star needs a pickleball court, basketball court,
a multi car course on his property, a customized golf course,
an outdoor infinity pool, a boat dock, thirteen person security detail.
You know I always think about, you know, kind of
next level wealth. This is like seven levels above my
(18:52):
total comprehension.
Speaker 3 (18:54):
Well, if he gets if he does get one hundred
and fifty million or anything above that, you know, it
would be the largest home sale in the history of Miami, Florida. Yeah,
pretty much dwarfing the current record by hedge fund manager
Ken Griffin, who bought a home for you know, a
paltry one hundred and seven million dollars just three years ago,
(19:14):
in twenty twenty two. So inflation's working for some people, amy.
Speaker 1 (19:19):
You know. I would also say Brady is well diversified, right,
He had some commercials a few years ago. He went
on in some kind of I can't remember what kind
of crypto or whatever exchange he was kind of kind
of pushing, you know. Ultimately he lost a little, but
he is well diversified.
Speaker 3 (19:34):
Enough that he lost more than a little.
Speaker 1 (19:36):
Well yeah, well he lost a lifetime of fortune for
most people, but for him, probably honestly a drop in
the bucket because he is pretty well diversified. Coming up next,
al Wors chief investment Officer Andy steut In to help
unwind a concentrated stock position. If you ever find yourself
in this situation, heads up to all of you Procter
and Gamble stockholders. You're listening to simply money presented by
(19:58):
all Worth Financial here and fifty five KRC The toxation.
Speaker 2 (20:06):
You're listening to.
Speaker 1 (20:06):
Simply Money, presented by all wad Financial. I Meani Wagner
along with Bob spawondseller in the Cincinnati area. We often
come across investors who have a concentrated position, so think
a lot of stock in particular companies. Right, We've got
some great, big, strong, hometown companies that we believe in.
Speaker 2 (20:30):
I'm just gonna throw.
Speaker 1 (20:31):
Procter and Gamble out there, because man, do I see
it all the time. But you know, I think over
the past couple of years, we've seen people fall in
love with tech companies. I have a client who has
a large position in Amazon right now, and so this
is something we see all the time. And the problem
is when that company is doing great, so are you.
(20:51):
And when the company is not doing so great, you're
not sleeping at night. So if this is a situation
that you are in, right, we see investors in this
all the time. We are joined by Andy Stout, our
chief investment officer, for kind of a news series that
we're starting here on the show Investor Solutions.
Speaker 3 (21:08):
Right.
Speaker 2 (21:08):
If this is.
Speaker 1 (21:09):
Something that's you're in this boat, how do you handle it? So, Andy,
this is not something new to you whatsoever. You know,
We've got lots of clients here at all Worth that
come to us in this situation. Let's talk about the
conversations that we're having with them. If someone is coming
to us with a lot of stock, right a lot
(21:30):
of their portfolio exists in one particular company, how can
we help them diversify.
Speaker 4 (21:35):
That in many ways? I mean Procter and Gamble is
a classic example. I mean you mentioned them, you know,
at the top here, and if you look at where
Procter and Gamble, if you go back, you know, ten
years ago, it was around forty dollars a share, which is,
you know, pretty insignificant compared to you know where it's
(21:56):
trading at the day. And so you have these gains
build up right now. Well, many people want to know, Okay,
how can I protect my gains or how can I
reduce my exposure without having a large tax bill? And
these are real concerns, and Amy and Bobby you're seeing
them all the time because one thing that pretty much
(22:16):
every single person at least that I know, can rally
around is, you know, let's pay lesson taxes. Or how
can we you know, not pay so much to the
I R R s so that if.
Speaker 3 (22:27):
Well, people love that dividend too. Andy, Yeah, the dividends
a good thing.
Speaker 4 (22:32):
You don't want to give that up, but you probably
rather you know, not pay Uncle Sam more than uh
more than you have to.
Speaker 3 (22:40):
So how do we do that? Right?
Speaker 4 (22:43):
So one thing, when you think about that, it's not
just about paying lesson taxes, because ultimately it's not necessarily
about reducing how many shares you have, but it could
also be about minimizing the risk you have there. So
when you think about it, yeah, we can you know,
have a predetermined ways to exit a position in a
(23:05):
tax efficient manner. Another thing that we can do, or
you know, an advisor can do, is essentially make that
single risk more market wide risks. So instead of having
exposure to one stock and which could you know, be
very volatile, could go who knows where, maybe we can
(23:26):
transfer that risk from a single stock to the broad market.
So there are quite a few ways that we can
handle that as well. So what I'll first talk about is,
you know, how an advisor can actually reduce the number
of shares in a tax efficient manner. So when you
think about that. There's a quite a few ways to
do it. The one of the more you know, one
(23:49):
of the easier ones to do, Amy and Bob is
if you have someone who happens to be charitably inclined,
the easiest thing you can do is donate that. So
this could be like a through a owner advice fund
or you know some other you know mechanism that you
can essentially donate a portion of that stock, because if
you're going to donate money anyway, why not just donate
(24:11):
the appreciated stock. There you're essentially eliminating any sort of
tax exposure from that donation and reducing or increasing your
overall tax basis and lowering your future taxes. So we
got donations. That's a really important one that I think
it's overlooked a lot, right. The second one is creating
a plan to exit out of the position over a
(24:35):
period of time through aggressive tax losce harvesting. And there
are certain ways that companies and advisors can help with this,
certain types of programs that essentially generate losses and take
those losses to offset gains in other areas. So, you know,
we can do this through programs, you know, by tax
(24:57):
smart trading as an example, where you look to look
for losses in other positions and then you know sell those,
but in order to not reduce your overall exposure, maybe
you go into something similar but not identical for I
R S reasons obviously, that allows you to maintain your
overall exposure, bank those losses and use those to offset
(25:19):
gains on the individual stock.
Speaker 3 (25:21):
A big thing with the with the charitable giving that
I don't think you mentioned, is just a reminder that
you get you get a tax deduction for the full
fair market value of the stock that you give away
to your donor advice fund or charity or chosen charity.
Speaker 4 (25:36):
Right, Andy, It's just like it's just like donating cash
in the same amount, and you can definitely have that
deduction on top of that. So it's a it's a
really good way to essentially help others while also helping yourself.
Now you we talked about ways to reduce your tax
exposure by actually exiting out of the shares. Now when
(25:57):
we think about, well, maybe you want to keep the stock,
but you want to reduce your overall exposure.
Speaker 1 (26:02):
I'm glad you're making that point, Andy, I'm glad we're
talking about this, because you know, we can't make our
investors right, even though we're saying like, hey, maybe being.
Speaker 2 (26:13):
Diversified is better.
Speaker 1 (26:15):
Lots of people have very strong, even sometimes emotional ties
to companies. Maybe it's my grandfather bought this stock said
you know, you know they they willed it to me
and told me never to sell it. Like I've heard,
I've heard every story on the spectrum about why someone
needs to keep, you know, a position in a certain company,
(26:36):
and so how then can we help kind of protect
them against themselves at that point.
Speaker 4 (26:42):
Yeah, there's a couple of ways that we can do this.
One of the more common ways is using stock options. Now,
stock options can be complicated, so you definitely want to
make sure that you fully understand, you know what you're doing.
But one way that you can essentially reduce your risk
while also you know, keeping that's keeping the underlying stock
(27:04):
is you know, employing without going into the weeds, I'll
call an exchange fund replication strategy. So using stock options,
which are calls in puts, you can essentially mimic an
underlying index like an S and P five hundred, and
at the same time you can offset all of the
risk of the stock going up or down doing what's
(27:27):
called a caller. And again you want to have a
long conversation with an advisor about this because stock callers
and stock options can be a pretty pretty complicated to
fully understand without going into the weeds. So that's one
thing that you can use as stock options do so
maintain that Procter and gamble position, uh, but eliminate that
(27:50):
company specific risk. And you don't have to use just
stock options for that. You can also use some other
strategies that are out there, but stock options are probably
one of the more well known ones to in order
to maintain your exposure.
Speaker 1 (28:06):
Andy, these are the conversations we're having in our offices
day in and day out. Right, someone coming to us
with a large part of their portfolio in one individual
company and one individual stock, you know, so we're having
these conversations, how do you mitigate this risk? What are
your options? Very much appreciate your insights on how best
to handle this. You're listening to Simply Money presented by
(28:28):
all Worth Financial here in fifty five KRC the talk station.
We're listening to Simply Money presented by all Worth Financial
and Memi Wagner along with Bob spond Sell, do you
have a financial question you can't figure out on your own.
There's a red button you can click them while you're
listening to the show. It's right there on the iHeart app.
(28:48):
Record your question. It's coming straight to us and it
is time to play retirement fact or fiction, and we're
really focusing in on estate planning right now. For step
fact or fiction, mister spond Seller, medical debt does not
pass to your heirs, to your loved ones, unless they
either co signed or are otherwise legally legally responsible for it.
Speaker 3 (29:10):
In almost every case, that is a fact. Does not
pass down to your airs now right. Yeah, it does
pass to your surviving spouse though, yeah so, but yeah
hopefully Well, very difficult topic to talk about, but fact
it does not pass down two kids.
Speaker 1 (29:28):
And this can get really tricky. I know of kind
of some some family friends. There was a situation where
they had had a major medical debt.
Speaker 2 (29:36):
He passed away.
Speaker 1 (29:38):
There's a condo that actually ended up getting willed to
the kids. But there's so much up in the air
because the medical debt situation with a surviving spouse is
not taken care of yet. Uh, And it leaves a
lot less than to the children. So you know, just
I think important to understand how these things work.
Speaker 2 (29:56):
Next, fact or fiction.
Speaker 1 (29:59):
Married couples, you don't need separate wills or estate plans.
Speaker 2 (30:04):
I'll answer this one.
Speaker 1 (30:06):
Part of this is factual and part of it is fiction.
You can use the same will or trust and have
all of your assets flow through that together as long
as it's set up properly. But what you do need
that's different in an estate plan is your own powers
of attorney, your own healthcare directives. You might have very
(30:26):
different thoughts on what you want to happen to you.
If you can't speak up to a doctor, then maybe
what your spouse would want. So it's important to think
through these things and have separate documents for those kinds
of things exactly.
Speaker 3 (30:39):
And I see this happen all the time, Amy, I mean,
I ask folks that come in and they have had
complex estate plans done, they've talked through everything, and when
I ask them about powers of attorney, they look at
me like a deer in the headlights. And you know,
we all know when we go into the hospital, that's
the first thing they ask for. Yep, you know, do
you have a health care directive and you know where
(31:02):
is it. So to your point, each spouse should should
know what they want and have a healthcare directive. And
these are not expensive, complex documents in most states, they're
just boilerplate documents.
Speaker 2 (31:15):
So you can get online.
Speaker 3 (31:16):
Yeah, but you just kind of tell them what you want.
Speaker 1 (31:19):
Yeah, I think it's important to be clear on these
and also make sure that they're updated regularly. Next factor fiction,
if you're moving to a different state, your existing estate
plan will still remain valid and compliant and you'll have
no issues whatsoever.
Speaker 3 (31:35):
I'm going to say fiction on this one. And again
I this is where I always love to get the
client's attorney involved as somebody actually moves in sometimes and
depending on which document you know, a trust for example,
it's going to work just fine. But I always want
to have the client's attorney read through these documents and
(31:56):
make sure they are valid in the state in which
they live. Am I mean one of the services we're
able to provide here at all Worth is we do
have a great team of estate planning attorneys on staff
who will do that. And gosh, we're operating in so
many states across the country. Now, we've got our attorneys
are well versed in this, and this is something that
(32:16):
you should take advantage of to have that reviewed.
Speaker 1 (32:18):
Yeah, there's community property states, there's common law states. There's
different treatments of property and things in different states. So
I think it's worth just another set of eyeballs when
you get to that new state, looking at it from
how things operate there.
Speaker 2 (32:33):
Factor fiction.
Speaker 1 (32:34):
Estate planning can help maximize or minimize taxes and fees
for your airs.
Speaker 3 (32:40):
Fact fact fact. And again this gets into proactive tax planning.
I'll just throw out one example. A lot of times
we have clients who are charitably inclined. It's way more
tax efficient to leave iras to your charities of choice.
Because you completely avoid all the income taxes and leave
(33:02):
your taxable accounts to your kids. You get a stepped
up cost basis the taxes go away. It's a beautiful thing,
but you've got to do the planning in advance.
Speaker 1 (33:11):
Yeah, I think it's really important. And you know, we
just saw some research on this. It showed how long,
first of all, it can take for an estate to
go through probate.
Speaker 2 (33:21):
I mean it can be close to years.
Speaker 1 (33:23):
It can be expensive for your loved ones, it can
be lots of headaches, and then ultimately you don't have control.
Speaker 2 (33:30):
Obviously you're gone, but.
Speaker 1 (33:32):
Things could end up in a way that you've never
intended them to, when someone outside of your family who's
never even met you, as making decisions about what happens
to everything that you've worked so hard to gain during
your lifetime. So it's really really important to have proper
estate planning set up. I know many many people I
talked to are like, you know, I know I need
(33:52):
to do it. I just don't want to do it.
I don't like thinking about it. This is an act
of love for your loved ones. Please ease make sure
you've got the proper estate planning setup. Coming up next,
we're taking you inside Bob's world of wealth. You're listening
to Simply Money presented by all Worth Financial here on
fifty five KRC the talk station. You're listening to Simply
(34:20):
Money present by all Worth Financial. I mean you Wagner
along with Bob's spond seller.
Speaker 2 (34:24):
How many years have you been an advisor?
Speaker 1 (34:26):
Now?
Speaker 3 (34:27):
Thirty four?
Speaker 2 (34:28):
Thirty four years of.
Speaker 3 (34:30):
I'm old Amy, thanks for ash.
Speaker 1 (34:33):
I am calling you experience, and I'm saying you are
bringing thirty four years of experience to the microphone now
nowaday nice when you're here with us, you like me
even more now, and so you know from your wealth
of experience, you've got some wisdom to share.
Speaker 3 (34:49):
All right, Tonight, we're going to talk about qualified charitable distributions.
And this is a topic that I come across all
the time, or should come across all the time, and
I rema, I remain kind of shocked and surprised that
more folks over the age of seventy and a half
have never heard of this number one and are not
(35:09):
taking advantage of it. Number two. So let's get into it.
A qualified charitable distribution is a provision in the tax
code for folks that are over seventy and a half
years old. We're up to one hundred thousand dollars a year.
They can leave ira assets directly to a chosen charity
and completely avoid the taxes on that gift. It's a
(35:33):
wonderful planning opportunity. Unfortunately, we're finding that a lot of
these folks are still you know, putting the check in
the offering plate at church or you know, what have you.
And you know, with the standard deduction as high as
it is now, most people are not getting any tax
benefit from their regular tithing to their church or gifts
(35:53):
to charity. Now, yeah, you can't. And so especially as
we get into age seventy three and above where you
have to take money out of your IRA every year,
this is a wonderful planning tool. And I just tell people,
we got to have a paradigm shift here. Stop writing
the check to your church. Let us do these gifts
(36:16):
for you. You tell us, tell me how much you
want to give to each charity every year, and we'll
take care of that for you. And then that comes
off the top of your taxable income. It doesn't count,
and it brings the tax bill down significantly. Now, a
couple of caveats here. You cannot make a charitable qualified
(36:37):
charitable distribution from a four to one game plan. You
cannot do that. So that's one other one of many
benefits to doing that rollover and moving it into an
IRA that you could control. And then number two, and
I learned this the hard way a couple of years ago.
You cannot make a qualified charitable distribution to a donor
(36:58):
advice fund. It has to go directly to the chosen charity.
So there's my words of wisdom tonight. If you've got
parents who are over seventy and a half, or if
you are over seventy and a half, make sure you
are talking to your advisor about this, because this is
a wonderful tech savings opportunity.
Speaker 1 (37:19):
My clients who are you know, usually in the year
before they have to do R and d's right required
minimum distributions either from their tax deferred ires or four
O one k's. There's like a nervousness about it. Right,
this is a new thing. We've never had to do
this before. We often will look at their plan and
I'll see that there's a charitable giving already in it,
(37:39):
and I'm like, okay, we can just marry these two things. Right,
You can continue to have the same impact on your
church or a charity that you love. You are already
nervous about the taxes that you are going to have
to pay on money you didn't need to pull out
because you're doing just fine.
Speaker 2 (37:56):
We can go ahead and then just give.
Speaker 1 (37:58):
That distribution straight that church or that charity no taxes.
And it's like light bulb moment, like wow, like it's
almost magic, Like I didn't know that that was an option.
So you can be really tax efficient and still have
the same impact on organizations that you love.
Speaker 2 (38:16):
Thanks for listening.
Speaker 1 (38:16):
You've been listening to Simply Money, presented by all Worth
Financial here in fifty five KRC, the talk station
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