Planning Tips for Retirement

Episode Transcript

Speaker 1 (00:00):
Join this week by our retirement planning professionals, Malia Quavis
and Kyle Kite. They come to us from Klass Financial.
Their website Klossfinancial dot com. That's Class k l aa
s Financial dot com. Their telephone number six oh eight
four four two five six three seven. No charge for
that initial get to know your appointment tech Coss Financial.
It will be complimentary to you again. Their office number

(00:22):
here in Madison, six oh eight four four two five
six three seven. I'm gonna be talking about wrapping up
the year and some retirement goal planning with Malia and
Kyle this morning. Don't forget though, if you have any
questions related to retirement. Of course, they are our retirement
planning professionals from Class Financial and they are here for you.
I just pick a phone, give us call six oh
eight three two one thirteen ten. That's six oh eight

(00:43):
three two one thirteen ten. I'll get you on the
air with folks from Class Financial. Speaking of our friends
from Class Financial, Malia, how are you doing this morning?

Speaker 2 (00:51):
Very good? That Christmas list is counting down quickly, isn't it.

Speaker 3 (00:56):
Yeah?

Speaker 1 (00:56):
With that late late Thanksgiving and it is it is
just are you s keeping a warm. I know for
folks that don't know you're you're originally a Califora It's
been a number of years, but you're a California native.

Speaker 3 (01:06):
Are you standing war? Yeah?

Speaker 2 (01:07):
Yeah, this is a little chilli. I think we got
to wear our extra long underwear.

Speaker 1 (01:12):
I think you're right on the Santa's on to something
with that outfit. Kyle, how have you been?

Speaker 3 (01:18):
I'm doing great, Sean, good to talk with you.

Speaker 1 (01:21):
Are you are, Kyle? Are you from Wisconsin? Are you
with native Wisconsin or Midwesterner?

Speaker 3 (01:26):
Nope, native Midwesterner. I'm born and raised right out right
by our Rockford office.

Speaker 1 (01:30):
Oh fantastic.

Speaker 3 (01:31):
Which is I'm used to it? Yeah?

Speaker 1 (01:33):
Yes, sure you are as used to it as you
can for sure. Of course, we've got a fun conversation.
Had an important conversation ahead as well with Melia and Kyle.
We're going to talk again about retirement goal planning. It's
always great to listen to the program, but don't forget
if you step out of the car, maybe you miss
part of it, or you want to listen back. You
can always check out the podcast available to you online

(01:54):
at klassfinancial dot com. That's Closs k l a as
Financial dot Com. Also great feature of the program is
the class Quiz question the week. Your chance to win
a fantastic prize this week is no exception. You have
a chance to win a twenty five dollars gift card
to Cheesecake Factory from our friends at Class Financial. And
before we get to our conversation about retirement goal planning
as we ring in the new year, let's actually talk

(02:17):
about last week's class Quiz question week get the question
and answer there as well.

Speaker 3 (02:20):
Malia.

Speaker 2 (02:22):
Yeah, so last week we had a great conversation about
maybe considering raining in some of that holiday spending so
they you don't end up on the other side of things,
which is probably more debt on your on your books
than you would care to have. So the question last
week was true or false. Winter holiday spending in the
US and twenty twenty four is estimated to be about

(02:44):
nine hundred and eighty billion dollars true or false. Correct
answer was true and it was as we saw black Friday.
The results were tremendous out there, So congratulations to our
winner from last week who correctly answered that that was
Rachel of one on a key. So listen carefully. Today's
question for the price.

Speaker 1 (03:04):
And again that's a chance to win a twenty five
dollar gift card to Cheesecake. Fact, we'll tell you a
little bit later on in the program how you can
win that. As Malia mentioned though, it's definitely important to
pay close attention because just about every time the question
answer comes up during this show. Of course, the website
of mbend their costs financial dot com. That's cost financial
dot com. And as mentioned, we look towards the end
of the air. Of course, twenty twenty five is nearly here.

(03:26):
Are there retirement goals that we should probably be doing
right now, Kyle planning.

Speaker 3 (03:31):
For Yeah, absolutely, Sean. As always, you know, these years
fly by. I joke with people it feels like July
fourth was just yesterday. But here we are already at
Christmas time. But there's no better time than right now
to start looking at potential adjustments that you may want
to make into twenty twenty five, to make sure you're
moving towards those goals that you're shooting for down the line.
So today we've got some great ideas to help you

(03:52):
start out on the right foot, but really to before
we get into twenty five, the first thing that we
should do is look back at what we where at
today and what went on. Obviously, So the first one
is to assess your current debt. Excuse me, so, as
Malia said, sometimes around the holidays, people spend a little
bit extra on those Christmas presents and things like that.

(04:12):
So you got to include any of this that you
may have just accumulated over the holidays here and really
understand the amount of interest you're paying to hold onto
that debt, because again, credit cards tend to be really
high interest. But also look at your mortgage debt and
does it make sense to make an extra payment or
two per year, as you've heard us talk in the past.
By doing that extra mortgage payment a year, that really

(04:34):
cuts down on the time that you're paying on that mortgage.
It's pretty pretty wild when you look at the big
picture of it. And then can you another year to
avoid a higher car payment? So obviously, car companies are
really good about running good advertisements this year with special
financing and all that kind of stuff to kind of
tempt you into this. But if yours is doing fine,
does it make sense to hold onto it for a

(04:55):
little while longer to keep those payments lower. Obviously, and
with debt obvious just comes your overall monthly budgets. Does
your paycheck go every month? Is it going to just debt?
Do you have so many bills out there that you
don't feel like you've got a lot left over? Is
it going towards something that you're not even conscious of? Right,
so going out to eat a few times more than
you realize, or spending a little more when you do

(05:16):
go out those types of things, and then understanding where
you and your household spend your income every month, will
all properly allocate funds towards something beyond just today. So
this is something that we always, you know, want to
want to be conscious of and make sure we know
where every dollar's going. Obviously, talking this small number three
would be review your emergency savings account, so again make

(05:36):
sure you have to you have a plan to have
at least that three to six months is kind of
the gold standard that he's shooting for, but it can
always go up a little bit like that, and it's
really a good good time to see if there's any
adjustment you can make to start saving a little bit
more here and there. And then reviewing your retirement account.
So a lot of times you want to look at
how much you put away last year and then did

(05:59):
you take advantage of the full company match, and can
you improve upon this in twenty twenty five by simply
increasing your percentage. So this is one of those little
things that we try to get people to do, is
that a lot of times, as you go into the
new year, you'll likely get a raise or something like that,
and you should be taking part of that raise. And
even just increasing your four to one K contribution by

(06:19):
one or two percent, you may not even feel it
on the paycheck, go a long way over the long
term for you talking this morning with it. And then
obviously when you're putting into the retirement accounts, you've got
to be aware of what the contribution levels are. So
these tend to adjust every year, and in twenty twenty
five they're going to be going up slightly. So it's
going to be going up to twenty three thousand, five
hundred for just a regular four oh one K or

(06:41):
four h three B planes that are under age fifty.
But remember if you're over age fifty, you get a
catchup of seven five hundred dollars this next year, so
you could be putting in a toll of thirty one
thousand if you're over the age of fifty. And now
there's a new little wrinkle that we have to be
aware of that if you're between the ages of sixty
and sixty three, they've actually come out with an extra

(07:03):
catchup contribution, if you want to think of it that way,
to get your total catchup to eleven thousand and two fifty.
So the most that you could be putting in as
a sixty, sixty one, sixty two, or sixty three year
old is actually a thirty four thousand and seven to fifty,
not that thirty one thousand for people under the age
of sixty. And remember these are four to one k
contributions that I just talked about, But IRA contribution levels

(07:26):
are a little bit different. So IRA contribution levels in
twenty twenty five are going to be the same as
they were in twenty twenty four, which is seven thousand
dollars for people under the age of fifty and one
thousand dollars catch up for those over the age of fifty,
so you can put a total of eight thousand and
if you're over the age of fifty. Nice. And then finally,
the one big thing that sometimes people forget about these,

(07:48):
and they're really really powerful accounts where big fans of these,
which is a health savings account, So these are associated
if you have a high deductible health plan through your
employer or if you're on the exchange and a high
deductible health plan. This is an account that you can do.
It's a health savings account. As I mentioned, that's tax
advantage way to save money. So this is what we

(08:10):
call triple tax preferred here, so HSA contribution. So the
money you put in actually reduces your tax will income.
And then you can invest HSA funds. A lot of
people leave them sitting in like a cash money market
savings account type thing, but you can actually invest them
if it's at the right custodian and if you if
the investment grows, you're going to get tax free growth

(08:30):
on that. And then as long as you pull it
out for qualified medical expenses, it's actually tax free. So
again that's the triple tax I was talking about. You
get the deduction when you put it in, it grows
tax free, and it comes out tax free as long
as you use it for qualified expenses. And in twenty
twenty five you're gonna be able to put aside as
much as forty three hundred bucks for an individual and
then eighty five fifty for a couple or a family

(08:52):
with an extra thousand dollars catch up if you're over
the age of fifty five, So again about fifty three
hundred or ninety five to fifty if you're over the
age of fifty. And another good thing about these is
even if you do them for medical expenses, once you
turn sixty five, they basically become another IRA and that
you can pull the money out and you just have
to pay the income tax on it, but you don't
have to pay the penalty because if you take it

(09:13):
out for non qualified medical expenses, they do penalize you,
so you want to make sure you're using it for
that if you can. But once you get over sixty five,
that penalty goes away, which is a nice little thing
to have with those as well.

Speaker 1 (09:24):
Yeah, sounds like an amazing tool to make use of
this morning, as we talk with Kyle Kite and Malia Quavis,
our retirement planning professionals from COSS Financial. You can learn
more about Class Financial on the website cossfinancial dot com.
That's COSS k l AA S financial dot com. You
can learn more about the team at Costs Financial. You
can also learn about the separate divisions and sign up

(09:45):
for the weekly Market Pulse newsletter. It's a nice little
email you get once a week. It's got a snapshot
of what's been going on in the markets recently, as
well as a link to the most recent podcast that
is free to you over at cossfinancial dot com. That's
Coss k l aa S Financial dot com. Scroll down
towards the bottom you'll see a little envelope that says
stay current. That's where you can subscribe to the weekly
Market Pulse newsletter. Speaking of staying current and staying connected

(10:08):
with COSS Financial. Of course, you can always call their
office right here in Madison six ' oh eight four
four two five six three seven. No charge for that
initial get to know your apployment Tech Loss Financial. It
will be complementary to you again that telephone number six
oh eight four four two five six three seven. We'll
get some details on some of the other things you
should be considering doing when it comes to retirement goal planning.

(10:28):
As we look towards twenty twenty five, with Malia and Kyle,
we will do that next as Money in Motion with
Coss Financial continues right here on thirteen ten. WIBI joined
this week by our retirement planning professionals from COSS Financial,
Malia Quavis and Kyle Kite. Of course, you can learn
more about everyone at COSS Financial, including Malia and Kyle

(10:49):
if you head on over the website cossfinancial dot com
that's Coss Klaasfinancial dot com. Under the about tab you
can get to know the team there. Speaking of being
at the website, a lot of fantastic information about class
financial things about their separate divisions. Also chance to sign
up for the weekly Market Pulse newsletter that available to
you at Cossfinancial dot com. There a telephone number office

(11:09):
right here in Madison six' oh eight four four to
two five six three seven. No charge for that initial
get to know your appointment tech Loss Financial. It will
be complementary to you again their number six oh eight
four four two five six three seven. Looking this week
towards twenty twenty five, talking about retirement goal planning and
Malia as as we're kind of going through some of

(11:29):
these steps, I've got to guess there's a lot more here.
Are there some other areas we should be considering when
it comes to planning and of course getting ready for retirement.

Speaker 2 (11:37):
Yeah, I think we've got to. We've compiled a really
great list here today just for people to say, hmmm,
am I missing something in some of these areas that
we're discussing. So one of them, certainly is taking the
time to review your asset allocation that you have within
your retirement assets. So you know, I do think the
holidays is a good time to slow down a little

(11:59):
bit and take a peak, you know, under the hood
and see what has happened this year. If you don't
have a financial advisor you're meeting with, certainly do this
on your own and really reflect how your investments have performed.
And perhaps they're out of they're out of whack at
this point. And I mean that in a good way,

(12:20):
because what we've seen is a lot of growth in
certain sectors and you may be needing to rebalance so
that your strategy is what it should be at this
point in your life. So really take time to make
sure that you are allocated the way you should be
for risk and then also looking at your time horizon.

(12:41):
So many people are like, yeah, I mean, I'm not
going to retire for fifteen years, well, that obviously might
not be quite as important as someone retiring in five
or two. So you really want to understand, you know,
your situation and how much risk you should have out
there on the table. Many people we've had shows about this.
Many people are heavy in their own company stock. Nothing

(13:04):
against your current company, whoever that may be. I'm sure
they're high performing and that's great, and I'm sure when
there's a great year, you believe that will always be
the case. Same with certain certain stocks you might hold individually.
But what we've seen is, especially when we're planning for retirement,
we don't want that much risk concentrated in one single stock.

(13:26):
And sometimes that happens without you even realizing it because
as you do retirement contributions, those come in the form
of company stock. So you really want to take us
a good look at what is compiled in your current
four oh one K or four oh three B. So again,
as you get closer to retirement, it's important that your
allocation matches up with your goals and timelines. The next

(13:49):
item we want you to do is put together a
net worth statement, So you want to take time to
carefully review your bank and investment statements. Tally all your debts,
I know that's the one. We'll gulp it and your savings,
put it together. And what you're gonna do is you're
gonna take your assets minus liabilities and determine your net worth.
Now assets do include your home and your car and

(14:13):
so forth, plus your investments, and then we subtract out
your liabilities that would include of course some mortgage, car loans,
personal loans, and of course credit card debt. And what
we want to do is kind of try to stay
on track from you know, quarter to quarter to make
sure we are slowly decreasing that debt and hopefully increasing

(14:36):
the assets, whether it be savings or savings in your
bank or certainly your retirement savings. It's really important to
know where you're at. And you know, speaking to my
daughter the other day and I said, well, so have
you looked at your four one K this year? And
she's in her twenties and she goes, she goes, I can't.

(14:56):
I'm not going to look at that because I know
I can't touch that yet.

Speaker 3 (14:59):
Mom.

Speaker 2 (15:00):
And I'm like, well, it's always a good thing to
see the baramna go up right, we don't like to
see it go down. We all understand that, but just
see incrementally that it increases. That should give you a
good feeling as you approach retirement. We also want you
to review your Social Security benefits. Either review or set
up an account at social SSA dot gov Social Security Administration.

(15:25):
You can get a statement online and that will give
you information about your earnings records, your estimated benefits, and
how much you or your family would receive in disability,
survivor or retirement benefits. So you know, we have our
clients do this on a regular basis. They no longer
send out those nice little statements unless you request it,

(15:46):
but typically just go online. You can see what your
benefit's going to look like at your full retirement age, which,
if everyone's listened to our show enough years, that's known
as your FRA. And you know we also talk about
you might want to hold back and not collect at
your FRA. You might want to wait till age seventy,

(16:07):
so those delayed retirement credits start adding into your future benefit.
And those delayed retirement credits are as much as eight
percent per year from that FRA up to age seventy,
So you want to understand because social security for most
people is going to be a good portion of their
future income. We also want you to review your beneficiary,

(16:29):
so we want to make sure all your investment accounts
reflect who should receive your assets if you're no longer here.
You want to make sure your will or your trust
also reflect the same beneficiaries. And then we also want
to want to make sure you have your power of
attorney documents in place, so that would be power of
attorney for property meaning investment assets as well as real

(16:53):
estate and other assets. We also want you to have
your health power of attorney in place so people could
speak on your behalf if you were unable to, so
make sure you do that. We would say review your
beneficiaries on a yearly basis because things change in families
and we want to make sure that your wishes are
carried out as you would like them to be.

Speaker 1 (17:13):
Talking this morning with Malia Quavis and Kyle Kite. They
are all retirement planning professionals from Class Financial. Their website
class financial dot com that's Class k l aas Financial
dot com. And the telephone for the office right here
in Madison six so eight four four, two, five, six
three seven and Malia. While we're reviewing things, there could
be certain insurance policy life insurance policies. You probably want

(17:35):
to make sure that those are up to date as well,
don't you.

Speaker 3 (17:38):
Yeah.

Speaker 2 (17:39):
Interestingly enough, some people have carried life insurance policies for
fifty plus years, like they got them when they're in
their twenties, And we're reviewing with people and they're in
their mid mid seventies, and well, we will really look
at the death benefit, how much has been put into
the policy? Is there a cash vew you attached to

(18:00):
the policy? And what we hear many times is people say, well,
I've been putting I've been paying my premium for fifty
plus years, and I don't want to stop paying it.
But then we look at really the details again and
go does it make sense to be keeping it for
that amount of death benefit? Or better yet, can we
actually take that cash value and apply that towards the

(18:22):
premium at the very least, So you really want to
look at does that make sense to keep the policy
in place? Please, please, please do not go out and
cancel these policies until you've reviewed them with somebody. But
you also want to make sure that you have beneficiaries
on those policies that still reflect your current life. And

(18:42):
then finally we're going to say, you know, we're big
planners here, so we want you to begin goal planning
for your retirement. I don't care if it's fifteen years,
twenty years out, or five years. We want you to
start planning. So when do you ideally want this to happen?
Obviously that's a moving could be a moving timetable for you.
Where would you want to live in retirement? How much

(19:05):
money do you need to make that a reality? Again,
you're going to sit down, hopefully with a financial planner
at some point and say, okay, tell me what do
I need and how am I going to get there?
And so with that, they will tell you what steps
you need to take today to reach that tomorrow, which,
believe it or not, is just around the corner. So

(19:26):
we just would say slow down, we'll assess where things
are at today so you can get to that future.

Speaker 1 (19:32):
Just fantastic information this week. A lot of information on
this week's program. Do't forget if you missed any of it.
If you can always listen back to this in previous
shows podcast right online at classfinancial dot com that's coss
k l Aasfinancial dot Com. Artel for number six oh
eight four four two five, six three seven. No charge
for that initial get to know your appointment that clause financial.

(19:53):
It will be complimentary to you again. They're number six
oh eight four four two five six three seven. We'll
do the class quiz question so weak walls to take
it down the home stretch with Kyle. We will do
that next as Money in Motion with Coss Financial continues
right here on thirteen ten Wibi, it's money in Motion
with Coss Financial. Don't forget about the website class financial
dot com. That's Coss Klaasfinancial dot Com. They're telling phe

(20:16):
number six so eight four four two five six three seven.
Talking this week with Malia Quavis and Kyle Kite, talking
about planning when it comes to retirement planning. Of course,
this time of year, a lot of us putting things
into perspective with the new year upon us, twenty twenty
five will be here in no time. And had some
great tips so far, and Kyle continuating along with that,
there are some things that we should be keeping in

(20:37):
mind as we plan for retirement, aren't there?

Speaker 3 (20:39):
Yeah, absolutely, Sean, We're going to switch gears a little
bit of the softer stuff now outside of the numbers.
But a big thing that we notice, obviously when we
deal with so many retirees is to stay active and
exercise your mind and your body. So know one that
retirement may be around the corner, and of course the
uncertainty that comes with that. Keeping yourself active will help
you get to the retirement you're dreaming of. So don't

(21:00):
wait till you retire to get healthy and exercise can
almost always help reduce stress. So most people, if they
have grandkids, that's going to be a big part of it.
They want to be able to chase them around and
all that kind of stuff. But also exercise in your
mind as well, so puzzles, doing all kinds of stuff,
and socially too, get out with friends, those types of
things that all leads to a fulfilled retirement. And you know,
find a hobby. So if you already have one, great,

(21:21):
spend some more time on that and things like that.
But if not, take a class or try something new,
because retirement may just be a few years away. You
want to start figuring out what the next bring. Right now,
a lot of people are picking up pickleball, it feels
like all of our clients have gotten into this thing.
So's that's a good one to keep moving and obviously
meet some great people too. And then another one is

(21:43):
to just evaluate your current job. So is your job
creating each stress? Is it time to find a new job,
and do you need to find a second job to
get your debt paid off sooner? So, like I said
so many times, where we're working with people that are
close to retirement, and if you've got your nest egg
built and you know you're looking really good for retirement,
you may just want to kind of take your foot
off the gas, but not fully retire, and just find

(22:04):
something a little less stressful for the last few years
of your career, honestly. Also, speak to your partner about
your joint financial situations mean that you can't have separate
bank accounts and some separate goals, but it's at least
good to all be on the same page so that
you guys know what you're working towards and what that
retirement could look like in the future, and live within

(22:25):
your means. So this is kind of where we started
the show, which is stop unnecessary spending. So evaluate every purchase.
Is it a need or a want? Remember that debt
makes everyone stressed and does not help you retire quicker.
So this is one of the questions that we always
get asked, you know, is how much do I need
to retire? And that number looks different for everybody, because
people that may not make a ton of money, but

(22:45):
they're good at living within their means, they're good at
sticking to a budget. They can have a very successful
retirement just because they've lived within those means. And meet
with a financial advisor to bring together your questions and
formulate a plan to accomplish your goals. And a lot
of people like to do this on their own. And
obviously you could find some great stuff out on the
internet and YouTube and all that kind of stuff now,

(23:07):
but all those answers that you're getting out there aren't
tailored to your specific situation. Nation is obviously going to
be different than your neighbors or maybe even your closest friends.
So you want to make sure that someone that you're
meeting with an outside council that is making sure you're
on the right track and accomplishing all those goals that
you want to And finally listen to our Money and
Motion show or our podcast, So we do this every Thursday.

(23:30):
We've been doing it for a lot of years now,
and we obviously post all of these on our website,
so we've got a lot of great resources on our website,
and like I said, listening to just these shows play back,
we've covered a lot of these topics that we just
kind of clossed over today, but we do in depth
shows on all of them that we've covered today.

Speaker 1 (23:47):
Really good advice this morning from Kyle Kaite Emily Aquavis,
our retirement planning professionals from Class Financial. Yeah, the website
is fantastic. Class Financial dot com. That's Class Klaasfinancial dot com.
Really to listen back to this in previous shows podcast there,
and as Kyle mentioned, we go in great depth and
do a lot of these topics we covered this week
and previous shows, so you can definitely check those out

(24:09):
online at Klassfinancial dot com. That's Coss k l aas
Financial dot com. The telephone number for the officer right
here in Madison six oh eight four four two five
six three seven. No charge for that initial get to
know you appointment at COSS Financial. It will be complimentary
to you I got a telephon number six oh eight
four four two five, six three seven. Go on and
hold on to that telephone number now because it's time
for the class Quiz question of the week. It works

(24:31):
like this. In just a moment, I'll ask you the
class quiz question the week. We'll then have thirty minutes
from the interday's program to call the COLSS Financial office
right here in Madison at six oh eight four four
two five six three seven. If you are the first
caller with the correct answer, you'll win this week's prize,
which is a twenty five dollars gift card to Cheesecake Factory.
This week's COLSS Quiz question the week? Is this true
or false? IRA contribution levels in twenty twenty five will

(24:56):
remain the same at seven thousand dollars. If you are
under the age of fifty, Is that true or false?
Telephone number six O eight four four two five, six
three seven. First call quick ans went that twenty five
dollars gift card to the cheesecake factory. Deffer gets, well,
that's CSS Financial's office right here in Madison. No charge
for that initial gets Tony appointment at COSS Financial. It
will be complementary to you again their number six O

(25:18):
eight four four two five six three seven Melia Kyle,
It's always great chatting with both of you guys.

Speaker 3 (25:24):
Have a fantastic day, Thanks Sean, Thanks Sean.

Speaker 1 (25:27):
Doctor Marty Greer joins US next year on thirteen ten
do wleu ib a