Let's Talk Money

October 25th, 2025.

Episode Transcript

Speaker 1 (00:02):
Good morning everybody.

Speaker 2 (00:03):
Thanks so much for joining me on this Chilli Fall weekend.
My name is Harmony Wagner. I'm a wealth advisor Appuchet
Financial Group, Certified Financial Planner or CFP, and also a
Certified Private Wealth Advisor CPWA, and it's my to join
you for the next hour and share the show with you.
I have a lot that I want to talk about
and would love to hear from the listening audience as well.

Speaker 1 (00:24):
Before I done that, I do have a little bit
of a sad thing to think about. But I did
realize that this is the last weekend we have before
daylight savings Time. That's right, next weekend we'll be in
November and we're gonna get an extra hour of sleep,
but it's going to start getting a lot darker. And
it's as it always stinks up on me every year.
It's crazy how fast the last few months of the
year ago, and lots of end of year tax planning

(00:48):
and financial strategies to put into place. So we'll talk
about that a little more throughout the rest of the broadcast.
And also if daylight Savings Time and the cold and
the dark makes you want to move to somewhere warmer.
We'll talk about what that might meet as well. So
before I get into all that, I do want to
remind everybody the phone lines are open, so you can
give me a call and ask whatever questions you might have.
The number is one eight hundred talk w G Y

(01:10):
one eight hundred eight two five five nine four nine.
If you aren't able to call or don't refer to
you'd rather ask in a written format, we have an
option for that too. You can email in questions to
ask Bouche at Bouche dot com. That's ask b O
U C H E Y at bouchet dot com. So
please utilize that. I say this probably every time, but
there's there's no silly questions And if you're thinking it,

(01:33):
chances are are somebody else is too, So please feel
free to ask. And I'd much rather talk about what
you want to talk about than just the things that
I could ramble on about for hours. Well, let's kick
things off with the market recap. It was a great
week in the markets. Actually, for anybody who tracks a
day to day you may have noticed that at the
end of yesterday's session we did close out at record

(01:53):
highs for all three of the major indexes and the
doll closed about forty seven thousand for the first time.
Cynthia Nadzac also had a new all time highs to
close the week. The drivers behind this we saw a
lot of happiness and exuberance from investors and as we
saw some software then expected inflation data coming out yesterday.

(02:14):
I will note that it came out over a week
later than typical because of the government shut down, the
data was delayed, but we did see the CPI release
come out yesterday morning and it showed the September inflation
at three percent. Even this was lower than expected by
just a hair but still lower. I will note also
that it was a little bit higher than the August

(02:34):
one at two point nine, so not necessarily great news
from an absolute perspective, but relative to expectations it was positive.
It was it came in lower than expected, and this
reinforced the idea that the FEDI likely to cut rates
by a quarter point at its remaining two meetings in
twenty twenty five. So we'll be closely following you know
what comes from the FEDE, the decisions at their next

(02:55):
two meetings, and also the commentary coming out indicating you
know what they speck the future to hold, but all
of the that was good at positive for markets this week.
There's also some optimism about President Trump meeting with the
Chinese leader, Jijingping next week, so we're hoping for some
resolution on some of the trade war headlines that we've

(03:16):
been seeing. And we're also coming off a very strong
week of earnings as well, So all these factors really
came together for another banner week for the major indexes. Interestingly,
some of the individual company names that were leaders, especially
on Friday, or Ford, which rose by over twelve percent,
was the big winner for the day with them producer
Albemarle and General Dynamics, a defense contracting company. I note

(03:39):
these because all these companies are a step away from
the AI giants that have been responsible for a lot
of the market run up this year. We hear a
lot of talk about an AI bubble. You know, we've
seen a magnificent seven making up you know, almost a
third of the SMP. So typically the S and P
is so diversified with five hundred of the US largest
companies in the US that we don't see as much

(04:01):
volatility driven by any one single company or stock. We
are at a higher risk of that because these big
players make up such a huge percentage of it. When
you look at a diversified index fund, for example, and
you compare it to an individual stock, even for a
great company, the volatility metrics in any given year are
dramatically higher with the individual company. Right, an individual stock

(04:25):
is likely to swing up to fifty percent from peak
to trough at any given year. Meanwhile, and more diversified
index is about half of that or even less. You know,
it might see about between fourteen percent and even up
to twenty percent typically, but not nearly as much as
the individual stocks. So when you start thinking about, okay,

(04:45):
a third of the S ANDP is made up by
these magnificent seven, that really does drive some additional opportunity
for volatility. If even one of those names you know,
has a down week, it's going to dramatically impact the
market performance overall. So it is nice to see some
other companies starting to have some good weeks here, But
don't take your eyes off tech yet. We do have Amazon, Apple, Meta,

(05:08):
and Microsoft all reporting Q three earnings next week, so
I would expect that's going to really play into market
performance as we go forward. As far as bonds. We
did see bond yields initially decline after the CPI report
came out, but they did end up rallying intra day
and ended the day nearly flat. Now, economy wise, we
do the FED meeting next week. Like I said, inflation

(05:29):
came in at three point oh which was software and expected.
So what we take away from this inflation is still
higher than the preferred range. However, it's not the runaway
train that many were fearing earlier in this year during
the tarif driven volatility of March and April. So we
may not be out of the woods. There's still certainly
a possibility for you know, more volatility ahead. But the

(05:50):
trend line is comforting at this point in the sense
that we're not seeing inflation skyrot rockety again as we
did a few short years ago. Despite the relatively news
on the inflation front, right, we're seeing it maintain. A
lot of Americans are still really feeling the sting and
that's been the inflation has been above the target for
about three consecutive years, so that does tend to you know,

(06:12):
wear down American households. Coming out of COVID, people had
a lot more cash reserves than is typical, and that
was that really bleed people's ability to get through that
period of very high inflation. We had the spike in
twenty twenty two where it crossed nine percent briefly, however
as it's you know, come down slowly but really stayed

(06:33):
above the FETs target of two percent. Right, we're still
at three percent, and particularly for middle working class Americans,
their way to increases that have not kept up with inflation,
and I was leaving a lot of people still struggling
to cover their expenses and find the ability to save
for future goals. There was a consumer sentiment survey conducted
in September. The results came out just a week or
two ago, and seventy four percent of respondence in that

(06:56):
survey said that they felt economic conditions are either fair
or poor. So we're seeing a real low for consumer sentiment,
especially if you look over the last two years. The
only other time that it was worse was in June
twenty twenty two, which, as I just mentioned, that was
when inflation was really at its peak. But we're actually
very close to that level that was the record low,

(07:17):
and we're just a hair above that now. So despite that,
there the markets have been, you know, on an incredible
almost three year now bull market run, and inflation is
staying relatively low and muted, but people are still not
feeling great about what's going on. I think a lot
of people have concerns, and one good week in the
markets isn't going to erase that. There still is worries about,

(07:41):
you know, what the future could hold, how some of
these bigger concerns play out. I talked about the AI bubble.
You know, there's the trade war going on, geopolitical tensions.
So you know, yes, it's great that we expect the
FED to still cut rates, but that's not going to
necessarily ease the pain for you know, or the worry
that a lot of investors are having right now. So,

(08:01):
you know, as I like to do, we look at
the macro side of everything. We look at what's going
on and the markets in the economy, but what do
we really pull from it?

Speaker 3 (08:08):
Right?

Speaker 1 (08:08):
We are just the average Americans trying to do what's
right in our own portfolios and our own personal financial lives.
How do we boil this all down and what do
we take from it now? I was on the show
exactly one week ago, and I was talking about volatility
and what to do right. We had come off a
week with some volatility, which had been a break from
from a very calm stretch, so people were feeling a

(08:29):
little bit nervous. I certainly got that feeling from clients
I was speaking to, and so I was talking about
what to do in volatility, how do you prepare for
it and all that. Now we have a week like
this and you know, a lot of people might get
comfortable again. You can get complacent, You can think that
all the volatility is, you know, short lived. I think
what we really have to take away whenever you zoom
out you really can see this clearly, is that anything

(08:51):
is possible in the markets any given day, week, month, year.
We have to maintain that long term investment in philosophy
that overtime, the stock market is the best asset class
to be invested. Of course, there's going to be volatility,
and you have to be prepared for that. And as
I talked about last week, there's some ways that you
could take advantage of that, but you do have to

(09:12):
be be prepared and realize that the volatility is just
as much a part of being an equity investors as
the up years and the growth. Now, it doesn't mean
that it's you know, a bad thing, but you do
have to be prepared for at any moment that something
could could change. There could be headlines, there could be
bad earnings, there could be you know, something going on
politically or with international relations that could really affect the markets.

(09:34):
And sometimes it's short and sometimes it's not right. I
think any of anyone who's been invested for more than
a couple of years knows that there are times where
the market is down for a long time and that's painful.
That's that gets tiring to look and see your portfolio
down and to maintain that patience, but it really is
the key that will get you through through the downtimes
to stay disciplined, stay invested, and wait for that market recovery. Now,

(09:58):
of course you've got to be prepared for it. Right.
So so if anybody is out there and they're taking
distributions from their portfolio, that reminds you again. I know
I'm going to sound like a broken record, but you
want to be taking advantage of the ups to set
aside any cash that you need in the short term. Right,
if any client comes to me and they ask I'm
going to be making this purchase taking a withdrawal from
my portfolio in the next you know, year, eighteen months,

(10:19):
two years, even, that's a sign to me that I
need to be preparing for it now. Anything we know
about ahead of time, we want to be proactive to
address and plan for. So if you are planning on
taking something out of your your invested portfolio, whether you're retired,
maybe you live off it, you take monthly withdrawals to
support your lifestyle. Maybe you just you know you have
something coming down down the pipe that's going to be

(10:41):
a bigger withdrawal. Now could be a great time to
set it aside, to put it in something more conservative,
to get it out of the markets, because, as we've
seen historically and recently, you know, anything can happen, and
we want to be prepared and proactive and take advantage
of the right moment. A lot of clients you know,
come to me and and I am thinking of one
in particular who you know knew we need to take

(11:03):
some cash, but it's it's hard. Natal experiences myself when
I was about to take a big withdrawal for a
house dump payment a couple of years ago. It is
so hard not to watch your portfolio day to day
when you know you have to take something out and
try to wait for the best moment. And what I
would tell anybody who's in that spot is, please don't
wait for the best moment. You will probably not see it,
and if you do, you will probably not recognize that

(11:24):
it is. And take a good moment if you if
you recognize it, if you say, hey, markets are at
all time highs right now. I'm not saying that next
Friday they won't be at new all time highs, but
right now that that's where they are, and so it
can be a good moment to set aside some cash.
I'm going to go to the phone lines now and
talk with Jonathan. Good morning, Jonathan. How are you today?

Speaker 3 (11:47):
Yes, I know it is and I'll listen to your answer.

Speaker 1 (11:57):
Okay, great question. So annuities are something that gets sold
a lot in the financial services industry. If anybody's been
listening to the show for any length of time, you
know that at Bouchet Financial Group we don't sell annuities.
We are not huge proponents of annuities. I am not
saying that they don't work for anybody, but a lot

(12:18):
of people they are not the right move, And particularly
as a fiduciary and a financial advisor, I take a
lot of issues with the way that they are often
sold and pushed upon people who might not understand all
that they mean. Annuities are sold as a guaranteed investment product, right.
That is the big draw for people who would purchase one.
The thing that you have to realize is that you know,

(12:40):
for any guarantee, and I'll put that in quotes, you
have to give up an awful lot. So annuities tend
to have high fees, so you know you're you're paying
maybe a big commission to whoever sold it to you upfront.
You may or may not be told about that or
realize it, but it's quite common and also typically the
ongoing annual fees and be steep compared to some other options.

(13:02):
If you decide to go down the path and you
annuitize it, right, you turn this asset that you had
into an income stream that can feel That can feel nice.
Right if you almost create a pension for yourself, You're
not worried about market volatility. You know you're gonna get
your check every month as long as that annuity company
is a going concern and solvent, but you know you're

(13:23):
gonna get your check every month. The issue becomes that
number one, you can't access the lump sum anymore. So
if you need to now you know, replace your furnace,
then you need to take out X amount of dollars
to do that. You're not going to have any luck
calling up the annuity company and asking for you know,
in advance. So you do take away some of your flexibility,

(13:44):
and you also take away the ability for your errors
to inherit it. So instead of it being an asset
where if you don't use all of it it goes
to the people that are important to you, it's going
to you know, just go back to the annuity company.
So you run the risk if you live for longer
than your life expectancy whatever they actuarily determine as your
life expectancy, then you do benefit from it. But if
you don't, then you know they do. You also can

(14:07):
often do similar things and now I know, there's not
that guaranteed element, so that's what really draws people into
the annuities. But you can often generate a cash flow
stream from your portfolio in a relatively secure and sustainable
way without without compromising some of the flexibility or paying
the high fees. So, as I said, it's not wrong
for everybody, and we work with clients and I have

(14:30):
worked with the client rights that I think that actually
does make sense for you. But I will say ninety
nine percent of the time it is not the best
and we are able to address whatever that client's concerns
are why they're pursuing an annuity, We're able to address
that in other ways. I'll go back to the phones
and talk with Jim from Troy Morning.

Speaker 3 (14:46):
Jim say, how are you doing good? Opening a lot
of information that my question is around hsas and just
trying to figure out if we qualify or not. I
get really confused with this concept. So my wife has
the health insurance, she's a teacher. They don't offer an HSA.

(15:08):
They do offer it at my employer. So with that
being said, would I qualify? Does it matter? Do you
have to hold the insurance as the person who holds
the HSA accounts? Does that make sense?

Speaker 1 (15:21):
I think I see what you're asking. Yeah, I'll try
to answer and if I miss anything, let me know.
So to be eligible to contribute to an HSA, you
have to be enrolled in a high deductible health plan.
It should be very clear when you're enrolling that whether
it's high deductible and HSA eligible or not. I believe
the threshold is and don't quote man as, I believe
it's somewhere between thirteen hundred and sixteen hundred is what

(15:42):
that deductible would have to be or hire to qualify.
But you know, either way, it should be very clear
from your plan if it's an option. So let's say
that you enroll through your work and your wife can
stay on her own insurance. I'm sure she puby has
great benefits through the teaching system, so you can enroll
on your Now, if you are just single, you can
only contribute up to the single limit, which is about

(16:04):
forty three fifty or something like that, So you can
only contribute single. You cannot contribute the family maximum, unless
if you had children and they were on your plan,
you could do that. However, to use the HSA, you
can use it for yourself. You can use it for
any dependence that you want, So even if your wife
isn't covered by your healthcare plan, you can still use
it for her. And that's espctually what I do personally.

(16:26):
My husband is a teacher as well, and I have
an HSA plan through my work. It's just under me.
I'm the only one covered there, but I contribute to it.
And then whenever, you know, he goes to the dentist
or whatever, he can swipe the HSA card, I can
use it for him. So there's kind of that. There's
two eligibility requirements, right Who can contribute in this case,
it would only be you as long as you're enrolled
in the hyproductrical plan. But who can use it? It's

(16:49):
you know, you, your wife, I think children, anybody in
your family? Did answer your question?

Speaker 3 (16:54):
Yeah very much to thank you so much.

Speaker 1 (16:57):
Yeah, thanks for coming, Jim, have a great day you too.
We're gonna go to a quick break here, but we'll
be right back with more. Let's talk money on WGY.
Thanks everybody for hanging with me through that quick break,
and I'll just do a shameless plug if you're listening
to that little ad and are interested in signing up,
it's gonna be a great presentation. Admission is free, but

(17:17):
see things limited, So if you want to come and
listen to our team talk a little bit more about
how financial planning and estate planning work together to maximize
your retirement and your legacy. Please sign up at to
five thirty on a Wednesday, November twelfth at the Hotel
Brookmire in Saratoga, and you can sign up right on
our website. It's gonna be a great, really informative and
educational seminar, and so if if you're interested, go ahead

(17:40):
and sign up. So I have a couple of email
questions that i'll go to now. In the first one
comes from an emailer who is asking about why a
fund that closed yesterday up is now showing an extended
hours value and showing some change after market close. Obviously
markets are not open today, so he's wondering why it

(18:01):
may be different. I'm not looking at that exact app
or stock, but what I will say is that sometimes
you may see future's movement after hours, and so you
may see what appears to be fluctuations in the price
of either an index or a stock or a fund
after hours, and so that could be what you're seeing.
I don't know for sure, but that's what I would guess.

(18:22):
So so I don't have a more concrete answer for you,
but but hopefully that helps and on Monday morning, when
when the market opens, you'll be able to see, you know,
exactly what that stock price is a live or fund
price in this case. Another emailer asks how do we
decide if and when to rebalance client accounts and shares
that their own method is to do nothing, and they,

(18:42):
you know, they just don't rebalance it until it's very
out of tolerance. This is a great question. Some firms
do this more on a as a science or I
really should just say as a routine, And they might
say every six months we're going to rebalance, every year,
going to rebalance. There can be some merit to that,

(19:03):
and if you do a lot of research on it,
on kind of the methodology of this question of how
often do you rebalance your accounts, you know, I would
say it is better than doing nothing. If you were
to say, I'm just going to go in and make
sure every six months or a year or whatever timeframe
you're comfortable with that I'm on target, I would say,
you know, we don't do that. We take more of
a customized approach. We're monitoring more of the parameters and

(19:26):
what we're seeing in the markets. So, for example, at
the end of last year, so December, we went through
and for all of our clients qualified accounts, by which
I mean iras, roth irays, any of these tax defferred
or tax free accounts where rebalancing is not going to
trigger a tax bill for any clients. For any of those,
we did rebalance back to target at the end of

(19:48):
last year, our thesis being we were at the end
of it at that point a two year bull market.
We saw some potential reasons for volatility ahead with a
change in political administration and just some economic concerns underlying,
and so we felt that it was a good time
to rebalance back to target for those qualified accounts. We
also had seen a period after two great years in

(20:09):
the equities market where equities had grown to be out
of proportion for a lot of these clients, which you know,
all of our clients are in risk based portfolios. So
when one side does much better than the other, which
typically over time the equities will outperform the fixed income,
you're going to have to pull it back otherwise you're
going to have a much more aggressive portfolio. So we

(20:29):
don't do it every year, we don't do every six months.
We could do it more or less frequently than that,
but we are really monitoring what do we see ahead
and when is at the right time. Now, it certainly
becomes more challenging. And taxable accounts right the investment brokerage accounts,
revocable trust irrevocable trusts, which in fact have a very
compressed tax bracket system and are even more tax sensitive,

(20:51):
and so there are times we would rebalance that. That
tends to be more on a customized basis for each
client and just trying to determine, you know, what's most
appropriate for them and their tax situation. Clients who are
very tax sensitive, we might allow their taxable account to
get more out of whack, and instead of rebalancing in

(21:13):
that account where they would get hit with taxes, we
might rebalance in their IRA. So for example, maybe they
want to be you know, sixty forty, their taxable account
grows to eighty twenty. Well, now we're going to put
the IRA to you know, fifty to fifty, So we're
going to try to balance it out an overall perspective
to make it as appropriate for them an overall as

(21:35):
we can. So a great question. Thanks so much for asking.
I always appreciate hearing from the listening audience, So before
you know we come to the bottom of the half,
I'll just kind of finish what we were chatting about
before you know. We've got a lot going on in
the markets right now. And if you were to ask
me to debate reasons why this bill market could continue,

(21:57):
I could do that. And if you were to ask
me to take the other side and say, you know,
why are there risks? I could do that too. And
that's pretty common, right. There is always things that are
facing the economy and there's always reasons to be optimistic overall.
You know, from a long term perspective. As a firm,
we are very optimistic, right. We've been overweight technology for

(22:18):
many years because even though it's in that growth sector
and it can certainly have more volatility exposure than just
the broad market or more value companies, we believe in
the long term prospects of that and our clients have
been rewarded for that over time. So there is a
lot of reasons to be, you know, optimistic when you
step back and look at it from a long term perspective.

(22:40):
Even the most you know, difficult downturn, it doesn't always
take that long to come back. A lot of people
feel like it will. That's not always how it works.
We even saw it back in two thousand and eight,
one of the most severe declines of our time. That
you know, our clients were made whole within nineteen months.
So even things that feel really severe feel really dramatic,

(23:01):
which is not the situation we're in now. But you
never know what's coming. It's great to maintain that long
term perspective and it is really the key to being
successful in your portfolios over time. So we're coming down
to the half here, but don't go anywhere. We're gonna
come back after the brief break for more. Let's talk money,
brought to you by Bouchet Financial Group, where we help

(23:23):
our clients prioritize their health while we manage their wealth
for life. Don't go anywhere. We're going to talk about
moving south in retirement and other important life transitions right
after the break, so we'll be right back. Hi, everybody.
Thanks for staying with me through that brief break. This
is Harmony Wagner Wealth Advisor, that Bouchet Financial Group CFP

(23:45):
Certified Financial Planner and CPWA Certified Private Wealth Advisor, and
it's a pleasure to have the opportunity to speak to
the radio audience today. I know we have a lot
of people who tune in week after week loyally, so
thank you for that, and maybe someone's tuning in for
the first time. Wherever you are. Thank you for spending
this hour with me. I hope you're getting something valuable
or maybe at least interesting out out of the broadcast today.

(24:08):
As you just heard, the phone lines are open, so
please give me a call. We've had a lot of
great questions already through phone and email and would love
to field some more. So if you have a question,
you can call one eight hundred talk w g Y.
That's one eight hundred eight two five five nine four nine.
You also have the option to send a question via
email if you prefer. That email address is ask Bouche

(24:29):
at Bouche dot com. It's a s K B O
U C H E Y at bouchet dot com. Well
before before, at the intro of the show, I was
talking about how we have daylight savings next week, and
there's definitely that that chill in the air. A lot
of the leaves that seem to be down now and we're,
you know, approaching the end of fall, and we all
know what happens after that, And for anyone who might

(24:51):
be thinking about moving somewhere else, somewhere warmer, whether full
time or just doing some kind of a snowbird situation
where you spend the the cold, dark months of the
Northeast somewhere else. I thought, maybe it will take some
time to talk about that. I don't think I've talked
about this on the on the show before, but we
do have a lot of clients who who are snowbirds,
who spend a lot of time in another part of

(25:12):
the country, and so let's see about what the financial
implications are for doing that. Now, whenever a client comes
to us and says that they'd like to pursue that,
of course, the first thing that we think about is costs. Right,
So you you've got some changing cash flow situation whenever
you make a big drastic change like that, and so
the most obvious financial planning concern is how to cover that,

(25:35):
and particularly housing, which usually represents the most significant expense.
So some people are preferring to purchase a second home
and that in which case you have to plan for,
you know, the initial purchase price and or financing. Plus
you're gonna have ongoing annual costs of taxes, insurance, maintenance,
and improvements. You have to realize too, that you know,
even if it's affordable to you, you still be taking

(25:56):
on a really large risk by having two properties, right
whatever one you're not and at the time, you're going
to probably be thinking about the other one and having
to have a plan in place to make sure it's
monitored and taking care of. Especially if you're much far
farther away. You know, you can't just start up the
street to it. So that's something to think about, both
the financial end of it and the risks the risk
management side to it. Alternatively, you might elect her rent instead,

(26:20):
take some of the risk out and just have the
flexibility to be there for a few months at a
time or weeks at a time, and that can be
a benefit too. You Now you may spend more in
rent than you would in a mortgage payment for the
months that you're there, but you have the flexibility you
can go different places every year. And especially for people
who are doing this for the first time, right, they

(26:42):
maybe lived in New York all their life. All they
know is they don't want to do another winter here.
But you may not really know where you want to be,
and so renting is a great way to test drive
some different cities states, see where what you want to
be and before you even if you are thinking about
buying at some point, to really test the waters and
see see where you really want to end up. You know,

(27:03):
I have a client the other week who is doing
something similar, right, they're going to be moving to Florida
are they're planning to And they were talking about how
you know, one one it's a couple and one spouse
wanted to rent for a little bit and then buying
me after a year, and the other doesn't want them twice.
And you know, my advice to them was, you know,

(27:24):
moving twice, would that be fun? I don't think anybody
really enjoys moving. You have to have a sixth sense
of humor to think that's fun. But it is way
easier to move when you're renting than to move if
you if you purchased and realized you didn't like it,
so selling the house, the closing costs, the timing of
everything is so much more complex when you purchase something

(27:46):
too soon and it ends up not being the right place.
And so it is really a question you want to
be asking if you're going somewhere that you're not familiar
with the area or the state, or exactly what you
might want to try renting first. But either way, there's
going to be some of these financial costs right now,
in addition to how's the expenses, you're gonna have to
plan for travel costs, So how are you going to

(28:07):
get to it or from your winter destination and how
often are you going to want to come back? Do
you still have family in the area that you're going
to want to see, you know, more often than just
for half of the year, So there could be some
increase in travel costs. Living expenses often spike as well.
So when the weather is no longer a limiting factor,
a lot of people find that their hobbies and activities
can continue year round, so that may involve a higher

(28:30):
entertainment or a leisure budget. So all of these things
factor into how much is it going to cost me
to be a snowbird? Right you might think, Oh, I'm
just living in a different location, it really shouldn't cost
me much more. That's not the norm for most people,
and so when you are considering it, I would recommend
that you plan pretty carefully and mean you're gonna have
to have a good handle on what you're spending is
now and then be realistic with yourself about what it

(28:51):
might be going forward. And I would always air on
the side of overestimating your spending needs at first. You
can always scale it back right. Your portfolio is not
going to come plane if you end up spending less
from it. But the opposite is not always true. So
making sure that you're doing the right planning and you're
being honest with yourself. With all of our financial planning,
we're highly, highly conservative. If a client tells me they're

(29:12):
spending one hundred thousand, I'm likely going to suggest we
put one hundred and ten thousand as a spending number
in the plan. I just want to make sure that's
just one example. But I want to make sure that
if I'm telling a client you know you can retire,
you can you can do this, that there are cushions
and wiggle rooms built in there where if they come
back and say, you know that I'm spending more than
I thought, we can say we planned for that, instead

(29:34):
of having a much more difficult conversation. So the same
is true if you're planning for a snowboard type situation. Now,
a second thing, and maybe you thought I was going
to say this first, but a second thing we look
at is taxes. Now, forewarning, I would never advise a
client to make a decision about where to live based
on state income taxes. They do have an impact, not

(29:55):
usually a make or break impact on a client's financial situation,
but they do have an impact, so we include that
in cash flow planning. Some states, like Florida Tennessee have
no state income tax, so moving to one of those
probably would have a positive impact on your net after
tax cash flow as long as you, you know, declare
residency there. If you if you're coming from New York,

(30:17):
you're gonna have to switch to be a resident of
Florida or Tennessee or w whatever it might be to
receive the state no state income tax. So it does
take time and it's a process, but that generally would
have a positive effect. Other states, you know, I think
about North Carolina, California, those are not considered especially tax
friendly for retirees, and so you've got to be aware
the state tax bill might eat into your your spending ability.

(30:39):
You know, it's not again, it's not usually a make
or break decision. And New York is not the best
for taxes either, so anyone who's moving from here, you know,
not likely to be much more painful, but it is
something to be aware of, and especially especially especially if
your plan is very tight, meaning that you know you're
you're spending is about the maxiitic be now without running

(31:02):
into portfolio issues down the road. In that case, it
might be more of a concern and you might think about, Okay,
how am I going to address costs and the sustainability
of my portfolio, so that that could be a factor,
at least on the planning side. I don't usually suggest
that it's a decision making factor, meaning we oftentimes have
someone you know, sit down and say, I want to
go to Florida. I don't want to pay and come

(31:23):
taxes anymore. And as the conversation unfolds, we realize they
don't have any friends there, they've never been there, they
don't even maybe really like hot weather. You know, they
just are doing it for the tax benefit, in which
case we would probably advise them not to. It's not
usually such an important consideration that you would want to
make a life change like that over it, but it

(31:44):
factors in the other important thing about especially if you
do change your state of residency and or buy property
in another state, is that it's going to affect the
estate laws. So you need to understand the probate situation,
the estate tax laws for the state that you want
to end up in so that you can do the
right estate and tax planning when you're there. Now, if

(32:05):
you have a will and it's done, it was done
in New York, as long as you're moving to another
state in the US, your will is going to be honored. However,
it might not be optimized. And that's something really important,
especially for people who are retiring and then they're moving
and they're planning on spending the rest of their days
in this new state. You're going to want to meet
with an attorney that's licensed in the state that you're
going to be living in and make sure that your will,

(32:27):
any trust, you have, any powers of attorney, healthcare directives,
all those things that make up a good estate plan,
that those things are correct and optimal for this state
that you're in, that nothing is missed. Because the laws
do vary from state to state, that variants can be larger,
it can be small, but either way, you know you
want to make sure that you address that before your
errors are having to down the road. A couple other

(32:51):
more ancillary or administrative items, So if you're moving out
of state or spending just you know part of the
year out of state is medical coverage. For retirees, access
to healthcare providers could be a really important thing to
think about. And if you're spending six months or even
three four months in a different part of the country,
your odds of needing care in a different state go up.

(33:13):
So for anyone who's sixty five or older and it's
enrolled in Medicare, their coverage will be active in any state,
So you know your coverage will be active. You're still
gonna have to find providers that you like and trust,
but it's not quite as complicated. For those who are
under sixty five, who might be on a private plan
or employer sponsored, you might need to evaluate, you know,
how's my policy going to work for me if I'm
away from home, and how am I going to get

(33:35):
care if I need it? So in both cases, you
know you're going to have something to think about if
you're moving, especially for those extended periods of time. And finally,
you know, beyond the major financial and health related items.
There's just a lot of logistics to consider. You know,
it's not a decision that you would want to make hastily.
You know, you're thinking about how you're going to maintain
the home that you're not living in at the time.

(33:55):
If you're planning on changing your primary residence for tax purposes,
you're going to have to plan to make sure you're
spending enough time there. You're also going to have to
do things like change your driver's license, voter registration. You know,
depending on the situation, they can be really strict about
where you're spending your time, where you're charging your credit card,
all those things. So a lot of logistics told think about,

(34:16):
especially if you're saying, I really want to get this,
you know, no state tax, I'm going to Florida. I
want the income tax benefits. So having a plan in
place for that, and even just thinking about how you'll
make new connections, how you'll you know, build the community
around you in your new location. You know, that is
it's not a financial it's not a tangible thing, but
it is something that really improves the quality of somebody's

(34:39):
retirement is having good community and you know, people that
you can rely on and spend time with. So that
is a part that can be difficult when you're moving
to a new area. So having a plan in place
or some kind of semblance of how you're gonna address
that is a good idea. We're going to go to
a brief break here, but we'll be write back with
my let's talk money on WGU don't go anywhere. Thanks

(35:01):
thanks for staying with me through that brief break. This
is Harmony Wagner, wealth advisor at Bouchet Financial Group and
CFP and CPWA, and it's a pleasure to join you
for this hour and to share about things that I'm
passionate about, things that I could talk all day about,
and also to hear your questions and if you do
have any that you'd like to ask, you can either
call in one eight hundred talk w G Y. That's

(35:24):
one eight hundred eight two five five nine four nine,
or feel free to send an email as well if
you're more comfortable. It's Askbouche at Bouche dot com. That's
a sk b O U c h E Y at
Bouchet dot com. You just heard the little advertisement that
we're having an event a seminar on Wednesday, November twelfth

(35:44):
at the Hotel Brookmire in Saratoga, And if anyone is,
you know, considering it, I would really encourage you to
sign up. It's a very informative event, very engaging, you know,
partnering with an attorney in the area who's great and
also our team will be presenting on planning with purpose
and especially connect the dots between your financial plan and
your estate plan and just how important all that is.

(36:05):
You know, we work with a lot of high net
worth clients and estate planning, although we are not attorneys
and do not give legal advice or write any documents
in house. Uh. You know, the financial planning and estate
planning really are so closely tied together, and you know,
you want to make sure that you're aligning everything, that
that your financial information is well communicated to your attorney

(36:26):
so they can make you the best recommendation based off
of how your assets are structured and split up and
what your concerns and priorities are. And then that loop
closes back. After you've got the estate documents done, you
want to go back to your financial planner and make
sure everything's executed. That is such an important part of it.
The best estate plan is not going to do anything

(36:46):
for you if it's not signed and trust funded or
accounts retitled, beneficiaries changed as needed. So that execution piece
is really really important. You know, a good attorney will
be giving you a letter of instruction after you all
done and saying, hey, this is what you need to
bring to your advisor and also any action steps that
you might need to do personally to make sure that

(37:07):
the estate plan that you worked hard on and designed
is actually put in place. So we're seeing a state
planning grow as you know a lot of the discussions
that we have with clients forty percent of clients in general,
this is just a general survey want an advisor that
offers a state planning guidance. They especially when it comes
to beneficiary designations, tax strategies, and education on a state

(37:29):
planning basics. You know, a lot of people work really
hard their whole lives, and of course they work with
their own retirement in mind, but for anyone who has
you know, children, grandchildren, nieces, nephews, people that you care
about in your life, you often want to really make
sure you do that wealth transfer right right. That could
be the last piece in a really impactful financial life

(37:49):
is you know, funding all of your goals, creating the
life that you and maybe your spouse or partner had
dreamed of, and then also having a successful wealth transfer,
you know, to the next generation. So when we sit
down with the client, we start by learning about their situation. Right,
I want to hear, who are the important people in
your life, what's your vision, what would it mean for
you to support them, what would it mean for those

(38:11):
individuals to be successful? And then we look at their
existing estate documents and their beneficiaries and we say, this
is how it would all flow. Now, something happened to
you today, This is exactly who would get what and
what the implications would be to those people, and does
that align with your goals? Right? And if it doesn't,
what changes need to be made? And at that point
it would be referring an attorney, it might be making

(38:33):
beneficiary changes and anything that needs to happen to make
sure that the plan is in alignment with with their
priorities and also their concerns. Right. We have some people
who say, Hey, I have a child who I love dearly.
I want to make sure they're taken care of. But
I don't trust that they're going to be very prudent
managing this money, and so maybe a spend thrift trust
is appropriate, right, And again an attorney will draft that

(38:54):
and give all the information on it. But as the advisors,
it's our job to say, I hear that you're concerned
about this, and I think this is something that could work,
and here's how you're going to you know, you can
pursue it. Estate planning can be really complicated. It's not
for everyone. You know, if you have a really simple situation,
you may not need a whole trust structure and everything.
But at the same time, there are a lot of
different reasons why you might, and so it's good to

(39:16):
have those conversations. Right, if you're going to be close
to the estate tax threshold, right, which is going up,
I mean for federal purposes, it's going up to fifteen
million next year. It's just a hair under fourteen million now,
So maybe you're saying, oh, I don't have a state
tax issue, Well, state wise you might, right. New York
is about half of that. Other states have even lower
estate tax thresholds. So you've got to think about the

(39:38):
state system as well as the federal system. When you're
thinking about that, right, if you have any complexity in
your life, maybe you were married previously, and how children
from a different marriage, and now you're remarried, and you know,
how do you handle the different family dynamics, and what
do you want to happen to your assets after you're
no longer here. All of those things may complicate your
estate plan, and it's always worth talking with an attorney

(39:59):
that you try us who's going to give you good advice? Now,
who's going to sell you on every trust in the book,
But who's going to say, you know, let's look at
what's appropriate for your situation. It's a really customized process
for each person or couple, so really important to have
the right partners lined up, attorneys, advisors, often tax preparers
as well. And you know, I'll say it again, I'll
say that a million times. The execution is so so important.

(40:21):
You know. I have seen clients come in with unsigned
documents and they tell me their estate plan is done,
and that makes me shutter. It's actually happened to some
famous celebrities too, where I think it was maybe the
artist formerly known as Prince, who did not have a
state documents in place and I don't recall exactly where

(40:42):
his his assets went, but it was, you know, certainly
not what you think he probably would have wanted. So
the execution is so so important. Everybody has to do it,
whether you're a celebrity with many, many millions of dollars
or the average joe. Make sure your estate planning is done.
This past week, we had a Woman in Wealth seminar
are down in Albany, and I had the pleasure of

(41:02):
being one of the panelists on that seminar along with
some of our partners, Claire McCrae who's an attorney at
Lumri Graysler, and Leah Henderson, who is a CPA with
Tilbecker to Yourmanty, and we had a great conversation. The
panel was about navigating life's transitions and try especially geared
towards women, but open to anyone to attend. And you know,

(41:23):
we talked about things that you might face earlier in
your career, buying a home, starting a family, and also
you know, mid career as well as more retirement type things.
And you know, something that we talked about which I
think resonates with a lot of people, is this idea
of you know, as my parents' age, you know, how
do I care for them? And what are the financial
things I need to think about with that? You know,

(41:44):
I see it more and more and it does seem
to happen. You know, this is just really anecdotal, but
it feels like it happens for many people as they
are approaching or and considering retirement for themselves. Oftentimes they
all are in a situation where now a parent or
a loved one needs care and they're starting to think
about that as well. So it can be a period
of a lot of uncertainty, you know, a lot of things.

(42:06):
Just as you're trying to worry about how do I
avoid my own retirement and you're starting to think about
the aging process for yourself, you're dealing with it for
someone that you love. It's emotionally challenging. Those conversations can
be really hard to have with an aging parent. Logistically
it can be difficult, and financially. In my experience and
in the statistics would back this up, it's much more
common for women to be the ones who are taking

(42:28):
care taking a caregiving role. It's usually the oldest daughter,
which is me and my family. So, you know, I
think about this as well and relate to a lot
of people who are in that situation. But that's usually
the person who's stepping up and arranging the caregiving, and
it involves a number of different financial elements, right Your
first thing, you got to make sure your parents estate
documents are in order before they're needed, before your parent

(42:51):
isn't able to sign or make changes. Making sure that
those the state documents are in place, they're executed, that
they are in line with your parents' wishes, and especially
understanding inheritance implications, so you know, you're thinking about what
type of account is passing to what person, How are
we got taxes going to factor in? You know, with
the Secure Act, especially the Secure Act two point zero,

(43:12):
which came out just a few years ago, really complicated
things and not usually in a great way for people
who inherit iras. So previously, if you inherited an IRA
from somebody, you could stretch it out over your lifetime.
Now you have to take that whole account out within
ten years of their passing. You may also have to
take little amounts out each year, and it kind of

(43:33):
depends on the situation. It's more complex than i'll get
into right now, but but the main thing to take
away is that, you know, if you have a million
dollar IRA and you have two kids and you leave
it to them within ten years, each of them is
going to have to take out five hundred thousand of
ordinary income on top of whatever they might be earning
in their household. So it's it can be a really

(43:54):
big tax implication and something that you want to think
about right now. On the flip side, if you have
charitable inclinations and you may want to leave some money
to charity at the end of your life, well maybe
you're going to use the IRA for that instead and
divert other assets that have more favorable tax treatment and
inheritance level to your individual of family heirs. So that's

(44:17):
you know, one thing to consider and just one example
of how this process is even more complex and it
might seem at first right you think, okay, beneficiaries are
lined up, We're good. There is even you know, further
layers to it as you think about if you have
two kids, I'll go back to that same example. One
of them is a very high income earner, one of
them's not. Well, that one that's not is inheriting a
lot more after tax than the other one, and so

(44:40):
it is something to think about. Maybe you're saying, well
that that's okay, I'm fine with that, right, the high
income earner doesn't need it as much, and that can
be a totally valid approach. But if you're thinking, I
want them to inherit the same amount, then you're going
to have to potentially address it in a different way.
After the estate documents are in place. You know, you
may find as a caregiving and a caregiving role that
you're going to be managing your parents by finances at

(45:00):
some level, whether as a power of attorney. You could
be a joint account holder, typically on bank accounts is
what I see, but sometimes people even get added to
the deed of their parents' home so that they can
manage it during life. There are pros to that. So
if you're a joint account holder, you can make decisions
with the same agency that your parent could, So if
they're incapacitated unable to be wise with it or even

(45:24):
take any action on it, you're able to do that
and even after they pass away. Right, So you may
be saying a power of attorney could do the same thing,
You're totally right. As soon as that person passes, a
power of attorney no longer exists because there is no
person to have agency for. So the power of attorney
would be great during your parents' lifetime. Once they pass away,
you're not going to have access to those assets anymore,

(45:46):
and so sometimes people choose to go to joint account
route for that reason, saying I might need to access
funds shortly after my parents passing for funeral expenses or
you know, femine members traveling to services, whatever it might be,
and so I want to be join on it. That
is a good pro of that approach. However, you do
need to be aware that there will not be the

(46:07):
same step up and cost basis if you are a
joint account holder as opposed to if you're going to
inherit it as a beneficiary. So something to think about,
you know, especially for a house, and that's oftentimes I
would really caution someone for being added during their parents'
lifetime to their house or taxable account or any really
large piece of property that could receive a step up

(46:29):
and basis. But if you're joining on it, you will
not receive the full amount, so it is a big consideration.
You may also have to do a lot of planning
for care expenses and thinking about your parents' cash flow
and all that, so you know, all those things can
get overwhelming, not to mention you might be considering a
possible reduction and income, whether partial or full retirement, or

(46:49):
just taking a leave of absence to take care of
your parents. So there really are a lot of questions
that come with this, and it's just one example of
the different transitions that we walk our clients through, helping
them understand and what they need to be thinking about
and giving them peace of mind that you're covering all
your bases, that you have a good, trusted advisor who
can guide you through these things and be your partner. Well,

(47:10):
thank you so much everyone for tuning in for today's show.
I really enjoyed spending the hour with you. I hope
you gained something valuable or at least interesting for today's discussion.
Don't forget to join us right here tomorrow morning at
eight am for more Let's Talk money, brought to you
by Blouchet Financial Group, where we help our clients prioritize
their health while we manage their wealth for life. Hope
everybody has a great weekend, and one final reminder, if

(47:32):
you'd like to attend our Planning a Purpose seminar on
November twelfth. You can sign up on our website. Thanks everybody,
have a great weekend.