Simply Money

Episode Transcript

Speaker 1 (00:07):
Tonight what the President and Congress's proposed tax reform could
mean for your wealth. You're listening to simply Money presented
by all Worth Financial. I'm Bob Sponseller along with Brian James.
All Right, Brian. Current Congress is currently debating and they
actually the House actually passed uh or in the wee
early hours of Thursday morning, the one big beautiful Act.

(00:31):
This still has to go to the Senate. It looks
like they're targeting, you know, the House wanted to get
their version done by Memorial Day, so you can check
the box on that one. This thing still has to
go to the Senate, you know, for final approvals. So
I think this is still a work in progress. But
let's get into some of the key provisions of what

(00:53):
could be coming down the pike here in the very
near future. Yeah.

Speaker 2 (00:58):
So, first and foremost, one of the big parts of
this is something that the President has been talking about
really since he put it in place in twenty seventeen.
So twenty seventeen, the signature legislation from President Trump's first
administration was the Tax Cuts and Jobs Act. That's the
thing that resulted For those of you who are experiencing
these kinds of things. That resulted in basically the doubling

(01:21):
of the standard deduction, which wiped out a lot of
things like the benefit of charitable deductions for people unless
you're making huge deductions. It also took away some deductibility
of mortgage interest and some other things, as well as
some tax cuts that were largely focused on corporations. Individual
people got a couple percentage points, but the corporate tax
break went from thirty nine percent down to twenty one.

(01:44):
And so that however, because we can't pass laws permanently anymore,
nobody's willing to vote for something that gets carved in stone.
It has what's called a sunset. Sunset happens to a
December thirty first of this year, so that act is
going to expire. Therefore, the big piece of the one
Big Beautiful Tax Bill Act, as they have called it.
That's not all worth naming of it. That's that's what

(02:05):
the writers of this bill have called it. But the
big part of that is extension of those twenty seventeen
tax cuts, so seeking to make permanent those tax reductions
that popped up in twenty seventeen and are going to
go away if nothing else is put in place. So
it also proposes eliminating federal income taxes on tips and
overtime pay for workers earning under one hundred and sixty

(02:25):
thousand dollars annually. And here we go again. That exemption
would expire in twenty twenty eight. Right, we can't carve
anything in stone anymore because it just can't get pushed through.
But we might be able to compromise with folks across
the aisle if we put an expiration date on some
of these things.

Speaker 1 (02:39):
So, in other words, for folks that are waiting tables,
keep your job until twenty twenty eight, get tax free tips,
and then switch jobs before the text block changes. I'm joking,
but yeah, it's ludicrous how fluid some of this tax
law can be and has been. The standard deduction under
this new bill. And I've just done a ursery read

(03:00):
through this, Brian, because I don't want to get too
wrapped up in it, because I know, like all these
tax bills, they can and do change, and there's a
lot of things that are going to change. You get
talked about between now and when this thing might get
signed in early July. But standard deduction has written now
would rise to thirty two thousand dollars a year for
married couples. Finally, jointly, that's up from current law thirty thousand.

(03:25):
Not a big change there. The big one that we've
heard about in the media here in recent days is
a lot of these congressmen, especially in New York and
Illinois and some of these high state and local tax states,
they were you know, standing up, jumping up and down
about this salt deduction. It looks like the House has
at least settled in on a forty thousand dollars salt

(03:48):
deduction for families with up to five hundred thousand dollars
in income. And what that salt deduction means is the
deduction that's allowed for state and local and real estate taxes,
which is are which are a big deal in states
like Illinois and New York.

Speaker 2 (04:03):
Yeah, any state that has high state and local taxes,
obviously is really is really fond of this. And those
actually happen to be the states that have a lot
of you know, Chicago obviously is a big business center
as well as New York City, one of the biggest
on the face of the earth, if not the entire universe.
And so therefore those folks they happen to live in
states that also have democratic leanings, and therefore they've had

(04:23):
a lot of a lot higher state and local taxes,
not to mention a lot higher incomes, because those are
of course our higher cost of living areas in the world,
and so therefore that's a higher percentage of higher income
means an awful lot of dollars Bob. So they're looking
to put that in place to again kind of appease
and hopefully get this dragged across the finish line.

Speaker 3 (04:44):
So metefits for seniors too.

Speaker 2 (04:46):
About a four thousand dollars deduction for Social Security recipients
over age sixty five is involved here too.

Speaker 1 (04:52):
Well, And I know the President campaigned on making Social
Security tax free. This doesn't exactly do that. I guess
this is a compromise. While we can't make it entirely
tax free, let's just throw a four thousand dollars dollars
deduction at people, you know, eight sixty five and over
and hopefully have roughly the same impact as making Social

(05:13):
Security tax free.

Speaker 2 (05:15):
Right, And I think we all here, we're all drawn
to the words tax free. My life would be so
much easier if there just were no taxes, and I
think we get a little bit of tunnel vision. There's
a lot of things that taxes cover. They aren't coming
from anywhere else, so we have to tax somebody. There
just has to be some way that we all come
together to pay for some of the things in life.
We can't all, you know, live on our own plots

(05:36):
of land and never leave them again. So if we
continue down this path, we are not going to end
up in a good spot.

Speaker 1 (05:43):
You know.

Speaker 2 (05:44):
I hope there's some recognition down the line that, Okay,
we're going to cut taxes, but we have also got
to cut spending as well. I feel like the messages
out there that we're cutting spending, but I'm not seeing
the results yet, Bob, I'm not super excited that Elon
really really did much in his couple months throwing a
hissy fits there in the White House.

Speaker 1 (06:02):
Yeah, that's a that's a topic we could spend an
entire show talking about. But I agree. I think they talk.
They talk a good game about cutting spending. But the
way the seat, you know, the Congressional Budget Budget Office
has scored this thing out, which is a whole other topic.
It really doesn't lower the country's debt. It slows down

(06:25):
the growth of the debt, and they're hoping for economic
growth to make up the different Parkly tax cuts do
stimulate economic growth. That's hard to score in advance, so
we'll see what happens. You're listening to Simply Money presented
by all Worth Financial. I'm Bob Sponseller along with Brian James.
Let's get into Brian, you know what do we do

(06:47):
about what we know about this tax bill? Now? I'm
going to share my opinion right up front. I don't
think people should be doing much of anything in terms
of drastic changes and decisions and planning other than what
you would normally do in a regular year. Because to
the point you've already brought up, Brian, I think these
tax rates are pretty much going to stay intact. Those

(07:08):
are going to get made permanent. That takes a lot
of uncertainty out of things. I think the stock and
bond market have already priced in, you know the fact
that these twenty seventeen tax cuts are going to be
made permanent. I don't think other than that people should
be I don't think people should be really making any
drastic changes in their planning right now for a couple reasons.

(07:30):
This tax bill really doesn't have a lot of impact
for most people. And second, things probably can and will
change between now when we get final passage of this bill.

Speaker 2 (07:43):
What do you say, Brian, things are probably going to
change between now and when you and I get behind
these microphones again, because that's just how this works. Remember,
we're only halfway through our bicamera legislature on this. It's
got to go through the other camera. But yeah, so
I think the one of the things people have talked
about since twenty seven is Okay, tax and we just
got a tax cut. The pendulum has swung in a

(08:03):
direction where we got a tax cut in place, and
it survived a democratic administration. If this goes through, it
sounds like it's going to become permanent until it's not.
So I would say, what we've done here, is this
goes through, is we've extended the window of lower taxes,
which taxes are historically low anyway you want to look
at it. Right, even before this tax cut, they were

(08:24):
still historically low compared to our higher tax periods in history,
despite the rhetoric. But anyway, if you're a person who
was looking at roth conversions, for example, a lot for
a long time now, For several really, since twenty seventeen,
a lot of people had a clock ticking to twenty
twenty six. I got to get all my roth conversions
done by twenty twenty six because taxes are going to
go up as we're sitting here right now.

Speaker 3 (08:43):
Yes, that is true.

Speaker 2 (08:43):
Taxes are going to go up if this bill passes,
that'll be extended out. However, I can't imagine that the
pendulum is never ever ever going to swing back the
other way politically, especially with all of the rhetoric and
the absolute hate that's out there right now. Means that
taxes could go up in the future. So I wouldn't
take your eye off the ball. If you've been working

(09:04):
on your roth conversions, just appreciate the fact that you've
probably got a little bit of an extension there to
get more of it done. But it should behove you
to continue that, maybe even do a little bit more,
if that's your goal to reduce your future r and
ds and to take the burden off of your kids
who might inherit those dollars a long time from now.
You got a little more time to do it, so
take advantage of it.

Speaker 1 (09:24):
One other thing that I think it does make make
sense to take a look at, and this is for
a really very high net worth people, and that's the
gifting and estate implications which are still very unclear in
this bill. The current exemption is thirteen point six million
dollars per person that you can pass down to the

(09:44):
next generation. I haven't seen anything that makes that permanent,
you know. And if it's not made permanent, that exemption
can fall to seven million dollars from thirteen point six
in twenty twenty six. So if it makes sense to
do some gifting and planning around large estates, I think
you still want to spend some time doing that in
twenty twenty five, just to make sure you get out

(10:06):
in front of what could or could not happen based
on what comes down the pike when the Senate gets
a hold of this tax bill. Other than that, I
think you do the same kind of planning that you
always do, you know, look at the raw of conversions,
look at charitable giving opportunities, all the major stuff that
we always do, Brian, and every client review that we

(10:27):
do with our clients.

Speaker 3 (10:29):
Yeah, and let's clarify one thing because this comes up
all the time.

Speaker 2 (10:32):
So we'll have people who come in and they'll say, Okay, well,
you know I've got, you know, five million dollars, my
wife's got five million dollars. We each own a business
or whatever. And I know these sounds like big numbers
to a lot of people. And that's kind of the point.
Even these folks with their ten million dollars in combined
assets do not have an estate tax problem currently. So
that's thirteen point six million dollar exemption. That's for each

(10:52):
member of a married couple. So meaning you could, as
we're sitting here right now, you can pass twenty seven
million dollars down to your kids without paying state taxes.

Speaker 1 (10:59):
So if you're.

Speaker 2 (11:00):
Anywhere south of that, as most of us are, is,
state taxes are not going to be a thing.

Speaker 1 (11:05):
Here's the all Worth Advice. Talk with your fiduciary financial
advisor about whether there are tax moves to make in
reaction to that one big beautiful bill. Coming up next
is Kroger overcharging you what a recent investigation just revealed. Next,
you're listening to Simply Money presented by all Worth Financial
on fifty five KRC, the talk station. You're listening to

(11:32):
Simply Money presented by Allworth Financial on Bob Sponseller along
with Brian James straight Ahead at six forty three, we
are answering your questions about company stock, the after tax
portion of your four oh one k and more. If
you're a regular shopper at Kroger, you might want to
pay close attention here, Brian, what's going on with Kroger

(11:54):
and Kroger shoppers.

Speaker 2 (11:55):
Recent investigation Bob by Consumer Reports in collaboration with the
Guardian and the Food and Environment Reporting Network, has uncovered
a concerning pattern about one hundred and fifty times where
customers were overcharged due to expired sales tags still displayed
on those shelves.

Speaker 3 (12:10):
So a lot of us do this.

Speaker 1 (12:11):
I do it too.

Speaker 2 (12:11):
I know what I want to buy, and I just
look at the generic version and the whatever other brand,
and I look at the one that's two for whatever
or on sale or and then I never.

Speaker 3 (12:21):
Look at it again.

Speaker 2 (12:22):
I don't look at what happens at the cash register
when I actually scan it, I throw it across the
scanner and chuck it into the cart. So these discrepancies
were found across twenty six stores in fourteen states, including Washington,
d C. As well some of these tags are being
about ninety days out of date, So in other words,
you're looking at a sale from three months ago, but
when you get to the cash register that you're not
paying attention to anyway, you end up paying more. So

(12:44):
this has hit all three states within our listening area here, Ohio, Kentucky,
and Indiana. So what's happening is pick up a box
of cereal it's on sale, I see a full price
all of a sudden, if I'm paying attention about a
bucks seventy more per item or an eighteen percent increase
over what they were supposed to be elegant for all.

Speaker 1 (13:01):
Right, Brian, I understand the story, I understand the issue,
and I'm sure Kroger will get on this and probably
already has to correct the problem. But we're talking about
only one hundred and fifty instances of this happening over
twenty six stores and fourteen states. That doesn't look like
a wide systemic problem. It's something to call attention to.

(13:23):
But uh, you know, Kroger has responded and they said
these incidents are isolated and not reflective of their overall operations.
And more importantly, as they always do, Kroger came out
and said, hey, we'll make it right. You know, if
you found an air, if you found a problem, you know,
all you got to do is come up to that
customer you know support counter that they have in every store,

(13:45):
and they refund the money. I think the key the
problem here is, you know, most people don't keep your
keep your Kroger receipts. And if you were, you know, wildly,
if you were in a hurry and just going through
that check checkout aisle and you overpaid for these items,
you're not going to have that seat to go back
and claim that dollars seventy per item. So I don't know.
I think to some extent, it's a whole lot of nothing.

(14:09):
You know, a lot of headline news here, but just
something to throw out there. And I think the reminder
is make sure if something's on sale when you do
go through that checkout aisle, make sure you're being charged
what any store, not just Kroger, but any store says
you should be charged.

Speaker 2 (14:26):
Yeah, Bob, I want to add run because we got
a lot of hard working Kroger people who are probably
listening to.

Speaker 3 (14:30):
Us right now.

Speaker 2 (14:31):
It is a big, huge, huge company and this isn't
something that somebody sat around a boardroom and said, hey,
let's pick these twenty six stores out of our twenty
nine hundred and gouge people. Nobody did that. It's a
big operation. Stuff happens, so give a little grace for
the problem to be fixed. It's good that we're shining
light on it, but again, not an intentional thing.

Speaker 1 (14:49):
Totally agree, all right. Another item that is really important,
especially for me, Brian, is if you're a sports fan,
especially one who has ditched cable, heads up, ESPN is
about to make a big move. They are launching a
new standalone streaming service this fall, but it's going to

(15:11):
run you about thirty dollars a month. I already have
ESPN Plus, Brian, because I like to watch college baseball.
I guess now we're going to get a brand new
opportunity to pay thirty dollars a month. And ESPN wants
to bundle some NFL games, NBA games, college football, the
works into one package. I don't know what to think

(15:31):
about this, because you know I've got When you look
at Netflix, HBO, Max, you know, Amazon Prime, and now ESPN,
it looks like everything's becoming unbundled from cable. You know
what everybody wanted. But boy, when you add up all
of these separate services, to me, the total bill is
starting to not even resemble what that good old cable

(15:54):
bill used to be. You got to really watch what
you're spending on all these subscriptions each month.

Speaker 2 (15:59):
Yep, job, I found something this morning when I was
drinking coffee that you don't know about because it's not
on our list of things to talk about today. But
I think this is an important reaction to it. It's
actually getting more favorable if you're paying attention to how
the game works. You can pick up a lot of
these streaming services as a bundle from something else. For example,
if you're a T mobile subscriber, you get MLB, you

(16:20):
get MLB Baseball every year, and they're currently also offering
Apple TV. You can also get Netflix with the right plan.
Local cable provider Spectrum also offers I believe it's Peacock
and paramounts Disney with some of their more basic packages.
It's not as painful as you used to be. However,
they don't really advertise these These are for things where
for people who really know where to look. They're trying

(16:42):
to hang onto those customers but they don't want to
give it away to anybody who's not putting that much
effort into it. So for all of these streaming services,
every one of them is tied to some bundle somewhere.
It could be a credit card. There are credit cards
out there that the little rewards they provide is free
streaming for or a credit towards these digital streaming services.
There are ways to beat this game, but you've got
to do your homework, just like anything else.

Speaker 1 (17:05):
It sounds like we need to get we need to
take an elective course in college, like a correspondence online
course on how to navigate managing your entertainment subscriptions because
this could get very complicated and very expensive in a hurry.
All right, every Sunday you will find our all Worth
Advice in the Cincinnati Choir and here's a preview MT

(17:28):
from Ohio County. Brian asks, as things stand now, I
think my Social Security benefits will be taxed. Is there
a way to avoid this? So yeah, there are ways
to and.

Speaker 3 (17:39):
We're not gonna say avoid.

Speaker 2 (17:40):
I don't think there's really nothing any more that where
you can avoid taxes, you can mitigate, you can reduce.
So social Security benefits are taxable, and I just ruined
somebody's morning.

Speaker 3 (17:49):
Some people didn't know that.

Speaker 2 (17:50):
But it is based on your income, so and also
depending on whether you're married or single and so forth.
But nobody pays taxes on one one hundred percent of
their Social Security benefits. At worst, eighty five percent of
your soci Scurity benefits is going to be taxed. Now,
I did not say eighty five percent taxation. What I
mean is if your Social Scarity benefit is ten thousand

(18:12):
a month, only a year, rather only eighty five hundred
of that is taxable. That's of course applied to your
whatever other income you have as well. That's the max.
Nobody pays more than more taxes than on eighty five
percent of their Social Security So yeah, there are other
things you can do as well. Bigger conversation though.

Speaker 1 (18:31):
Well, and you hit that eighty five percent tax exposure once,
you know, for a married finling joint couple, you know,
as soon as your income gets up around forty four
thousand dollars, so you get there pretty darn quickly. It's
it's it's virtually impossible to totally avoid taxes on Social Security.

Speaker 3 (18:47):
So next question comes from Mike and Sharonville.

Speaker 2 (18:50):
Mike says his dad is a retired widow over with
about ten thousand dollars in credit card debt, and when
he passes away, Mike wonders, if he's going to have
to worry about paying that off?

Speaker 3 (18:58):
What do you think about that, Bob.

Speaker 1 (18:59):
In most case is absolutely not. Now the ten thousand
dollars is going to have to be paid some way, somehow.
It's going to come out of the estate, you know,
at the end, you know, so whoever is supposed to
inherit inherit Dad's money at ten thousand dollars has to
be paid off before the inheritance has passed down. The
key here to avoid, you know, kids being liable for
this is do not join jointly have joint accounts with

(19:23):
your parents, because then you're liable for all of it.
All right, think you are immune to fraud? All Worth,
Steve Ruby and our tech expert Dave Hatter join us
next to discuss the staggering amount of money that criminals
are stealing. You're listening to Simply Money presented by all
Worth Financial on fifty five KRC, the talk station. You're

(19:49):
listening to Simply Money presented by all Worth Financial. I'm
Bob sponseller along with Steve Ruby, and tonight we're joined
by our cybersecurity expert, mister Dave Hatter. How you doing today, I'm.

Speaker 4 (20:02):
Good as always. Thanks for having me on g I'd
appreciate the opportunity to raise awareness about these important topics.

Speaker 1 (20:08):
Well, it's an important topic and we appreciate you coming
on the thing we want to talk about today. We
just saw an article that said that Federal Trade Commission
indicates that Americans lost a total of twelve point five
billion dollars to fraud in twenty twenty four, and that's
a twenty five percent increase over the previous year. Dave,

(20:32):
what in the world is going on?

Speaker 4 (20:35):
Yeah, I know that's a pretty mind blowing number. And
I want to point out and you know, FTC is
a good source for this kind of information. So is
the FBI, and so I don't forget. I encourage all
of your listeners to go to the Internet Crime Complaint
CENTERIC three dot gov. This is an FBI sponsored site.
Not only can you report incidences of some sort of
cyber crime flash fraud there, but it's full of lots

(20:57):
of useful tips to help you avoid these kind of things.
I bring that up not only because it's a useful
resource and I encourage everyone to report this sort of fraud.
I've seen FBI agents at public presentations say that because
in many cases, there is no requirement to report this
sort of fraud. I mean, there are certain legal requirements
for businesses in some cases, but because there's no overall

(21:20):
global requirement to report this, you know, they estimate that
the number of this number of dollar amount of fraud
is actually much higher than what's being reported. So while
twelve point five billion dollars seems like a mind blowing amount,
I also believe it's much larger because I know many
people who've had some kind of scam or fraud perpetrated
on them and they didn't report it. Right. They're embarrassed,

(21:42):
they don't see any value in it. They know law
enforcement doesn't have the resources to go after small scale frauds,
so they just don't report it. Yeah, it's pretty insane,
and unfortunately guys, because the scammers are very good at
finding you. They'll go wherever their people are, whether it's
video games, social media, email, text, and they've gotten really

(22:02):
good at spoopy things and making things seem legitimate, like
the toll scams we've seen, so it's everywhere. Unfortunately.

Speaker 1 (22:09):
Well, Dave, that twenty five percent increase, you know, twenty
twenty four over twenty twenty three is just a mind
blowing number, at least to me. What has changed over
the last twelve months. I mean you brought up the
toll text thing. I no, lie, Dave, I've gotten five
of these things within the last week, no kidding, and

(22:30):
that's not hyperbole. I've gotten five text messages about some
kind of Ohio turnpike toll fee just within the last week.
But what is causing a twenty five percent increase from
twenty twenty four over twenty twenty three in this fraud area.

Speaker 4 (22:48):
Yeah, I've got some of those myself. And I think
it's a combination of things. First off, more and more
applications Internet of things is so called smart devices. You know,
more of your data is being collected, more of your
data is being sold through data brokers. More of your
data is being leaked or breached all the time. I
would bet you almost everyone in your audience has gotten

(23:08):
at least one data breach notification from some organization they
did business with. LA some cases didn't even know that
this organization had their data, the National.

Speaker 5 (23:16):
Public Data Business with and they still get yeah.

Speaker 4 (23:20):
Exactly, yeah, because their data was sold at some point
right National Public Data background check company. Anyone that's ever
gone through a background check knows, you know, the kind
of sense of information they collect. And this is why
it's not trivial when these data breaches happen and their
data's out there. I know, people think, well, I got
nothing to hide. My stuff's already out there. Part of
what is fueling these attacks is the fact that hackers

(23:41):
don't necessarily have to write a program and just randomly
carpet bomb email addresses or phone numbers with texts or
even voice phone calls. They now have information about you.
They know who you are, they know where you are.
They probably know something about your interest, which also then
helps some crap much more realistic message. But my point
is there's so much data being leaked all the time

(24:03):
through these breaches. The bad guys have a treasure trove
of information not only to find you, to find you
via email, to find you via text, to find you
via phone, maybe find you on social media. Because they'll
go wherever people are. They'll use whatever mechanisms they can,
but to know enough about you that they can impersonate
legitimate agencies. And thanks to AI, a lot of the

(24:24):
old school red flags things like well, the grammar's weird,
the spelling's wrong, the punctuation doesn't make sense. That's all gone.
Now even if you don't speak English at all, you
can use these tools to generate perfect pros, send out
texts in mass to lists of people that you've gotten
through some sort of breach, and you know, they know
more people are spending more time online. They know people

(24:46):
are using these various technologies in their everyday lives. So
if you're not skeptical, if you're not tuned into the
kind of scams that are taking place out there, you
know you're unfortunately already made victim for them. And again
they're using what Wherever there are people are, you can
guarantee there will be there with some type of scam.

Speaker 1 (25:05):
So this article is interesting to me.

Speaker 5 (25:08):
One tidbit I pulled out of is that younger people
have actually reported losing money to fraud more often than
people over seventy, So the age ranges of between twenty
and twenty nine. That makes up forty four percent of
all reports filed last year, and I was kind of
asking myself why that might be the case, and maybe
it's because these individuals were almost born into technology and

(25:29):
they've put themselves out there more or maybe is it
they're actually self reporting fraud more often than people ever
seventy What are your thoughts around that, I'm curious.

Speaker 4 (25:40):
Yeah, if I had to guess, I would say some
combination of the two things you just mentioned. I think
a lot of older people probably aren't using as much
technology as younger people, so there's not as many attack
vectors to get to them. And secondarily, I think younger
people are more likely to understand that they can go
report these things that are probably more like to report it. Now,

(26:01):
that's kind of speculation on my part. I don't have
any psychographic data to back that up, just from talking
to people of various age ranges and people that this
has happened to. I know with a lot of older
people who have become a victim of one of these
sorts of scams, whether it's you know, peak butchering or
the toll scam, that there's so many of these different
ways they'll come at you, and they're so good I mean,
at the end of the day, these folks are con artists.

(26:23):
They're just using these electronic mediums to get to you.
I bet everyone of your listeners has gotten the old
Hey I thought we were meeting for lunch today from
some number you've never seen before, right, And they're trying
to engage you in a conversation, build up some rapport.
This is the peak Butchering idea. And then then the
Devinci tests to Hey, did you know I'm making a
lot of money and crypto let me tell you about it.

(26:44):
As crazy as that sounds, these scams are rampant, and
they know that more and more people are using text,
more and more people are comfortable with text, and they
know it's impossible to look at a text message with
the naked eye and know whether it's forgitimate or not.
On those told things, guys, if you look through that
very carefully, these guys are so creative and deviious. On
an Apple phone, if you get a text with a

(27:05):
link in it, like to go pay your purported toll,
it's disabled by desault if that is not a known
contact to your phone, And if you read the instructions
in there, they tell you very carefully reply to this
so it adds that to your approved list, and then
open it again so you can click the link. They
actually give you instructions that tell you how to become

(27:26):
a victim of their devious little scam. Again, these people
are making enormous amounts of money. They're very smart, and
that's why you know that the best thing you can
do outside of awareness is a healthy dose of skepticism.
But text, I think is going to be an increasing
attack vector because everyone uses it. And again, it's really
hard to look at a text and know whether it's

(27:46):
legitimate or not.

Speaker 1 (27:49):
All right, great stuff, as always from our cybersecurity expert,
Dave Hatter. Dave, thanks again for coming on with us.
Coming up next America's Favorite segment, Ask the Advisor. You're
listening to Simply Money presented by all Worth Financial on
fifty five KRC the talk station. You're listening to Simply

(28:14):
Money presented by all Worth Financial. I'm Bob Sponsller along
with Steve Ruby. Do you have a financial question that
you'd love for us to answer. There's a red button
you can click right there on the iHeart app. Simply
record your question and it will go straight to us.
All right, it's time Steve for our Ask the Advisor segment.

(28:35):
Let's let it rip here.

Speaker 3 (28:36):
I am fifty five years old. I don't have any
idea of when I want to stop working. What does
a financial plan look like in that situation?

Speaker 5 (28:45):
So that's Robert and Fort Thomas, and this is a
great question.

Speaker 1 (28:48):
I have so much fun with it.

Speaker 5 (28:49):
Already called myself a financial planning door Bob, you tried
to call yourself not one, but let's face it, you
are to Building a financial plan will give us that
baseline understanding of where you are today if we maintain
the status quo, such as maybe I just want to
work into full retirement sixty seven years old, g lexo security.

(29:10):
Once you have that financial plan, you can start playing
around with the numbers. You know, what would it look
like to retire at sixty two? What would it look
like to retire at sixty seven but spend more money?
We can find all kinds of different scenarios to show you.
Maybe you're fortunate enough that you have a terrible day
at work and you decide never to go back, even

(29:31):
though you're only fifty five years old, because in this situation,
your four oh one K would be eligible for the
rule of fifty five and you could pull penalty free.
I mean, there are so many different planning opportunities, but
a big one is how do we close the gap
on health insurance? Are you held from some other vehicle
or from some other benefits to your employer, for example,
or do we have to shop on the open market
to close that gap until sixty five? Nonetheless, creating that

(29:53):
baseline can give us that opportunity to run different planning scenarios,
to explore a range of possibility. And that's what financial
planning is about. It can help you answer some questions
that maybe you don't know you should be asking.

Speaker 1 (30:05):
Great point, I think you know, we talk about it
all the time. Money is a tool, and the great
thing about a good financial plan is it presents choices,
and choices are good in life. All right, let's hear
next from Jerry and Madeira. What do you got, Jared Creed?

Speaker 2 (30:21):
Does it make sense to start contributing to the after
tax portion of my verro one?

Speaker 1 (30:25):
K Well, I think this is on a case by
case basis and in general, depending on your income. If
you're a high income earner, we want to max out
that pre tax bucket. First, in a lot of retirement plans,
you've got three buckets from which to choose. You've got
your pre tax contributions, then your ROTH, and then your
after tax. The first thing we want to do, irrespective

(30:47):
of all the tax stuff, is make sure that we
are maximizing that matching benefit from the company. You want
to make sure you contribute up to that matching portion
because most of the time these matching contributions or you know,
roughly fifty cents on the dollar free money, so to speak,
on usually around the first five or six percent of

(31:08):
your pay. But you know, when when folks have maxed
everything out and they looked at WROTH options and all that,
these after tax portions, depending on how your plan is constructed,
can lead to some of this mega backdoor WROTH planning
that can come in handy for high income earners. And

(31:29):
we're seeing more and more people look at that because
it allows you to maximize way above the standard IRA
and standard four oh one K contribution limits what you
can actually put away in a retirement plan and then
get it into that WROTH bucket so it can grow
tax free.

Speaker 5 (31:46):
Just to be clear, when we're talking about way above
that limit in twenty twenty five is seventy thousand dollars.
That's the most money that can enter your four to
one K plan. Trump chance for you, Steve, Yeah, right,
I wish maybe maybe when i'm your age, I'll be
able to save that much, But he grimaced, Right, No,
I do want to point this out because it's so
valuable that limit. That seventy thousand dollars. That's the combination

(32:08):
of pre tax, roth after tax, and company contributions. So
working with an advisor to help you map out what
that looks like so that we can maximize the after
tax feature your four and K is a huge benefit.

Speaker 1 (32:21):
All comes down to planning. Great point, all right, let's
hear from Julie and Franklin. How do you handle concentrated
stock risk, especially when it's part of an executive compensation package.

Speaker 5 (32:33):
So this is a great question because obviously there are
executives out there with significant positions in a single company
stock because it's how they are compensated, not entirely, but
sometimes significantly, And in doing so, a lot of your
future retirement success could be tied to that single company stock.
And that's honestly, that's by design for executives so they

(32:55):
have skin in the game. But making sure that when
you do make that transition into retirement, we are exploring
tax efficient ways to unwind or diversify is massively beneficial.
The easiest way, and it's almost like a duck thing.
You could sell the stock, but in doing so you
are going to realize taxes, So mapping that out accordingly

(33:16):
is very important. I would argue more importantly would be
some kind of strategy like hedging selling options against the stock.
I know that this is stuff that a lot of
advisors have access to. We can help with this. This
is where you sell covered calls against the option option
strategy against the stock, and if you generate that premium,

(33:39):
then you can use that to offset the gains of
selling the stock. If you realize a loss on selling
the call, then you can use those losses to offset
the gains of selling the stock. So no matter what happens,
you're able to capitalize on that option strategy to sell
some of the stock. There's also things like diversifying through
exchange of funds or direct indexing. There are a lot

(34:01):
of strategies to deploy. Obviously, some of this stuff gets
rather confusing and you know, it always goes back to
explore help professionally from an advisor that can navigate these
these different options with you.

Speaker 1 (34:13):
Yeah, a ton of great options out there, Steve. But
to your point, you know, when you get into some
of these more complex options, you really would benefit from
having a good fiduciary advisor walk you through what the
options are and then more importantly, make sure that we're
only using options that truly fit well for your personal
financial plan. Coming up next agem of advice from our

(34:35):
very own mister Steve Ruby, who believe it or not,
is going to tell us it's okay to spend our
own money. You're listening to Simply Money presented by all
Worth Financial on fifty five KRC the talk station Black.
You're listening to Simply Money presented by all Worth Financial

(34:57):
on Bob Sponseller along with Steve Ruby, and that theme
song can only mean one thing, A Ruby gem of
advice is coming. Steve lay it honest.

Speaker 5 (35:08):
So this one, this one's very fresh for me, and
it hits kind of hard because it was literally a
meeting that I.

Speaker 1 (35:13):
Had just yesterday.

Speaker 5 (35:16):
This is a couple I've been working with for a
couple of years, now and they've they've been prolific travelers
in their lives. They have so many wonderful stories, such
great advice to provide if you're looking for feedback about
places to go or places not to go. They're in
their eighties. Health has begun to rapidly, rapidly decline for
one of them, and they're leaving the Cincinnati area and

(35:36):
they're moving to another state to be closer to some
of their family. And the big questions in the face
of a period of volatility were how much can we
take out or what options should we explore that that
minimize time and effort on our part. That they don't
want to take on debt, for example, but they wanted
to explore maybe borrowing against some of the investments that

(35:57):
they have to not only get into what would be
probably their final home, but make it perfect for them.
And this is important because traveling has been such an
important part of their lives, and you know, one in
the couple is no longer particularly mobile, and she wants
to make sure that she was able to look out

(36:18):
the window and feel comfort and feel joy. And there
was a lot of stress around the idea of taking
distributions during a period of volatility.

Speaker 1 (36:29):
For them.

Speaker 5 (36:30):
Their children are well off. It's not important to leave
money behind that they're fine financially, so we look at
their situation. They have fixed income, they have social Security,
they have pensions, They have a fair amount of assets
to pull from if they needed to. But the fear
was there because of the current market volatility and questions
surrounding will it create a problem for them in the
long term. They also have long term care, so sitting

(36:52):
down reviewing the plan, having a conversation and the answer
is quite simple but surprising to them. Spend your money.
Spend it. It's okay, we can do a distribution. We
can pay to make this home perfect for you, And
there were tiers in the meeting. It was very challenging,
but the value that it brings to have an advisor

(37:12):
in the room explaining that this is an option for
you and there's nothing to worry about was incredibly valuable
for them.

Speaker 1 (37:20):
Well, as I sit and listen to you tell that story,
a couple thoughts come to mind. Stee. First of all,
aren't those clients blessed to have someone like you as
a true fiduciary advisor who has worked with them for years?
And help them build a plan, maintain a plan, and
be able to anticipate a situation like this where you're

(37:41):
able to walk them through some of these critical final
years of life where they can truly enjoy all the
fruits of their labor over decades, decades and decades. I'm
sure it was very meaningful.

Speaker 5 (37:53):
Oh it was, Yeah, it was. It was a great
meeting at the end of the day, a challenging meeting,
but a great one for them to know that they
will be fine financially and to have their advisors signing
off on a rather large distribution to make their you know,
some of their dreams come true.

Speaker 1 (38:09):
Good stuff, all right, thank you for listening. You've been
listening to Simply Money, presented by all Worth Financial on
fifty five KRC, the talk station