August 22, 2025 • 41 mins
What happens when the person you trusted most with your money turns out to be the one stealing it? On today’s episode of Simply Money presented by Allworth Financial, Bob and Brian unpack the stunning story of former Northwestern Mutual advisor John Kersey, accused of running a multi-million-dollar fraud right here in Cincinnati. Bob and Brian break down how the alleged scam worked, and—most importantly—how you can protect yourself and your family from ever falling victim to something like this. Whether you’re managing $500,000 or $10 million, this conversation could save you from devastating mistakes.
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Speaker 1 (00:00):
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This is important information for you.
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Listen just FYI fifty five KRC the talk station.
Speaker 2 (00:35):
Tonight.
Speaker 3 (00:36):
How a Cincinnati financial advisor's criminal plea is impacting trust
in the wealth management world locally, and what thoughtful investors
should know Right now, you're listening to Simply Money, presented
by all Worth Financial on Bob's on Seller along with
Brian James.
Speaker 2 (00:52):
Imagine this.
Speaker 3 (00:53):
You're an investor in Cincinnati, living comfortably, stable family, trusted
financial advisory, money invested in annuities, maybe change your life
insurance policy.
Speaker 2 (01:05):
Beneficiaries around.
Speaker 3 (01:07):
Everything feels great until one day you discover your money
wasn't actually invested at all.
Speaker 2 (01:13):
That's exactly what clients of John J.
Speaker 3 (01:16):
Cursey, a former Northwestern Mutual advisor here in Cincinnati, say
they discovered Brian.
Speaker 2 (01:23):
Pretty shocking, but reasons to watch out.
Speaker 7 (01:27):
Here a little bit, right, Yeah, just another cautionary tale.
And the reason we're talking about this is because mister
Kursey did plead guilty the other day to stealing eight
point six million dollars from his clients over about twenty
years at Northwestern Mutual now Northwestern Mutual, to their credit,
did fully reimburse all the affected clients for their losses.
So this time, you know, it was a It was
(01:48):
a bullet dodge for a lot of people. But it's
just a cautionary tale for the kinds of things that
people are susceptible to. So how did he do all this, Bob, Well,
there were a lot of multiple planes regulatory filings. I
had not heard of this gentleman until this, and I
did I quickly found. You can see it all on
broker check, by the way, get to know broker check.
If you're going to hire a new advisor, you can
go see if there's been any complaints about him, about them,
(02:10):
him or her, And in this case, they're sure were
so uh on things like he instructed clients to write
personal checks directly to him.
Speaker 1 (02:17):
That is a major major red flag.
Speaker 7 (02:19):
And he just told him the money I'm gonna take
this money, it's gonna go in your insurance policies, these
annuities and trusts and whatever. But instead, mystically the manager
of the money just kind of disappeared. He attracted people
to do this with promises of you know that we
hear this all the time. I've got this secret idea
that nobody knows about. It's going to and I guarantee
you five to five and a half percent, which is
kind of crazy now because now that's that's a really
(02:40):
good marimony market fund from not that long ago. But
he was doing this during a time period where the
banks were paying absolutely nothing and he was claiming he
could get five five and a half percent guaranteed. So
these are again, if you run across this stuff, run
the other way.
Speaker 3 (02:54):
Yeah, And I think this story is not so much
about you know, Jay Kersey or Northwestern Well, by the way,
I mean, I've competed against Northwestern Mutual for decades, very
reputable firm. There are a ton of really good advisors
with that firm, So this is not a slam at
all at them. The main points we're trying to drive
(03:16):
home here is never write a check to any person
you know posing as a financial advisor. The check all
always needs to be made, paid to an investment custodial
firm like Fidelity Schwab wherever the investment money is actually held,
or directly to the insurance company. Never write a check
(03:38):
to a person, no matter how much you like them,
love them, trust them. You know, they're your neighbor, they
go to your church. Never write a personal check to
a person for investing. And I think the other thing,
the other thing here, Brian, that we came across in
this story, and believe it or not, some clients gave
mister Kersey blank checks, you know, put dollar amount and
(04:00):
left the did not write, you know, anything on where
the money was going. That's another huge red flag never
to do. And I think this, you know, he's been
an advisor, was an advisor since nineteen eighty six, you know,
he came into this business about five years before I did.
Speaker 2 (04:18):
So I'd run across.
Speaker 3 (04:19):
Him just reviewing client statements and things. And again, like
I said, our firms, you know, competed against one another,
so I'd run across his name. But I think I
think this goes back to the same the same way
clients got involved with Bernie Madoff. I mean this situation here,
nine ten million dollars is kind of a mini Birdie
(04:41):
madeoff type of situation, but the fact pattern is the same.
You know, blank checks, fictitious statements, all that. And I
guess that leads to another point that I want to
drive home here. You know, it takes you three to
five minutes to call an actual firm if you ever
have an any questions about where is my money?
Speaker 2 (05:02):
Can I have an account statement? All of that.
Speaker 3 (05:05):
I mean, most of this stuff is all online right now,
or all of it is. But if you're kind of
old school or you've had this stuff, you know, you
don't work on computers a whole lot, and you just
want to see a paper statement. You can call any
reputable office, including Northwestern Mutual by the way, and somebody
will print out and mail or email to you an
(05:26):
actual account statement. And that way you can know and
have things verified. Hey, I sent this money in, I
want to see evidence that it's been invested, and I
want to see evidence on a company account statement that
the money actually exists. So those are the main things
we're trying to call out here today.
Speaker 7 (05:44):
Yeah, and I want to make sure yet you're right,
this is not not to detegrate another firm out there
at Northwestern Mutual is very very well respected firm. But
this just kind of goes to show too, it's not
that hard to be a dirtbag in this industry, quite frankly.
And this is all attributed to court documents. Finally, is
this is that we're not reporting hearsay or anything. This
is all available in the court case because the guilty
(06:04):
plea happened the other day. So, you know, I think
the fact that the firm didn't have any record of
this and he was an employee, but think about this.
He convinced people to write blank checks, to write checks
to him. So what is to stop someone else from
creating a business card that says, hey, I work for
Northwestern Mutual or Fidelity Investments or or heck, you know
(06:25):
all Worth Financial.
Speaker 1 (06:26):
Right, This is how easy it is. You got to
have your guard up.
Speaker 7 (06:28):
As somebody is sitting in your kitchen table and they
show you a piece of paper with a logo and
a name on it, Think of how easy it was
to create that.
Speaker 1 (06:35):
So, just like Bob is.
Speaker 7 (06:36):
Saying, you know, this is something to always be super
wary of. Is So now, what are the in result
of this. Well, he pled guilty to fraud. He's been
barred by THINRA, which is the securities regulatory body, and
there's been at least fourteen complaints involving more than twelve
million dollars in alleged losses. So and so this is
obviously his career is over. He's going to go to
jail for a decent amount of time. But let it
(06:57):
be a lesson to be very vigilant on these things.
Speaker 3 (07:00):
Yeah, and again to repeat, you know, Northwestern Mutual, to
no one's surprise, stepped up and made all these clients whole.
And but you know what a huge cost to their
reputation and to say nothing in the money that they
had to dole out. And it's just a very very
sad situation. And like you said, Brian, anybody could pull
this off if they have the intention of defrauding people.
(07:22):
So the point is, have all your ducks in a row,
verify every transaction, and make sure you're getting statements from
the actual custodian insurance company what have you. Don't just
take anybody's word on it, you know, and when they say,
well we've invested it at a guaranteed five and a
half percent, you know, and in this case, this guy,
(07:44):
I guess, you know, like Bernie Madoff, created fictitious statements
and people were led to believe they were real, very
very very sad situation.
Speaker 4 (07:54):
Yep.
Speaker 7 (07:54):
And I think this is a great chance to go
over just what are the other things out there? What
else can happen? So there's there just to kind of
give an idea. This one close to home because there
are a lot of people listening to this, probably recognizing
the name, so you know that that can be helpful,
you know, kind of knowing the environment, the group that
he was in. But the other kind of things out
there that we're seeing a lot of what are called
(08:15):
romance and pig butchering scams. This is where a fraudster
will kind of build trust over time and then push
people into fake crypto investments. For example, FBI is stating
that losses are over four and a half billion dollars
here from twenty twenty four. From that kind of thing.
There's also, of course medicare and health scams. You might
get calls, in fact, we all get calls offering free
medical equipment, genetic testing. These are really just attempts tore
(08:38):
to steal Medicare information and you know, use your record
to apply for benefits. There super extra dangerous right now
because open enrollment is coming up. IRS tax scams are
out there. You'll get emails and tax claiming that your
tax refund is waiting in such instut state or whatever,
and they're fake threats of arrest for unpaid taxes. As
we always say, do not respond to anything except a
(08:59):
paper letter from the IRS, and even then call the
IRS directly, you know, look it up online and call
that number and they'll pull your record up and see
what's going on. You may even still get that the
letter itself could be fake at this point. But the
IRS of course, will never call you. They will never
text you, They will not email you. That is all scams.
The IRS will only send you letters Tech support scams,
of course, you know a lot of times firms can
(09:23):
or scammers can get a little cookie on your computer
that brings up a red screen that says, hey, you
have viruses, call this one eight hundred number and we
will fix it.
Speaker 1 (09:31):
Well, it's not really a virus.
Speaker 7 (09:33):
It's literally just a pop up to scare the daylights
out of you and get you to write a check
and rest assured if they get you to write one check,
they may come back years later, since you trusted them once,
they may come back and want thousands of dollars.
Speaker 1 (09:45):
And frankly, they honestly, they get it more often than not.
Speaker 7 (09:48):
And of course there's always phishing, defake scams, lots of
things like that, So lots of things to be to
pay attention to and be aware of.
Speaker 3 (09:55):
Yeah, and I want to talk about one more thing,
you know, with the case we're talking about here, you know,
with this fraud case, because I'm thinking of you know
how nine to twelve million dollars over a thirty five
to forty year career is not a lot of money
in proportion of the amount of money that this individual
was handling on the behalf on behalf of clients.
Speaker 2 (10:14):
Here's what I mean by that.
Speaker 3 (10:16):
If I had to guess, I'm saying, I would guess
that eighty to ninety five percent of all transactions that
this gentleman did with his clients were completely legitimate. They
were verified on statements and all that. And when you
the point is, when you get you start working with
higher net worth people two three, four, five, ten million dollars,
(10:37):
you can easily if you get people to write a
check you know personally to you, you can easily skim
off five seven thousand dollars at a pop, and it
takes thirty five forty years for that to add up
to nine to twelve million dollars. And for people that
trust the advisor don't check transaction summaries. And let's face it,
(10:58):
a ten million dollar portfolio can move around by eight
to nine thousand dollars, you know, in an hour. So
I think a lot of people just trust don't check things,
and that's how money can get skimmed.
Speaker 2 (11:11):
And I can totally see how this happened.
Speaker 3 (11:15):
So again the reminder every time you write a check
that and this is just the law, this is how
this works. You should be receiving a written confirmation and
a transaction summary. And a lot of people hate to
have their mailbox cluttered with paper or emails and sometimes
Brian people complain to us about it. Why am I
getting so much stuff? Well, this is why we are
(11:37):
trying to verify that every penny that you send to us,
we are telling you where it went, how it was invested,
the date, the amount, all that, and there's a reason
behind that. Hopefully we have illustrated that for everyone today.
One more quick point comes up frequently.
Speaker 7 (11:55):
There's a lot of people out the other are kind
of a verse to using online for financial reasons, such
as the people I've never set up my online banking
because i want to keep it protected. I've never gone
online from a sociecurity information and all that kind of thing. Remember,
if you have not set up your profile, then anyone
out there with enough information about you can set it
up on your behalf using their own contact information, their
(12:15):
own password. Now they got you, so it's in my
I believe now that you are actually more exposed if
you don't use these services than if you set them
up yourself. If you set it up yourself and somebody
changes the password, you're going to get notified fifteen different ways.
Versus if you never set it up and I have
never seen the site, You're going to have no idea
that it even happened.
Speaker 2 (12:32):
Excellent point. Here's the all Worth advice.
Speaker 3 (12:34):
The best defense against financial fraud isn't trust its due diligence,
check credentials, confirm every transaction, and ask the tough questions
before you sign anything coming up next. For many, retirement
should feel like freedom not fear, will show you ways
to ensure that that fear component doesn't happen to you.
(12:57):
You're listening to Simply Money, presented by all Worth Financials
along fifty five KRC, the Talk.
Speaker 8 (13:02):
Station fifty five KRC Cincinnati, available everywhere with the iHeartRadio
app now number one for podcasting. Fifty five KRC an
iHeartRadio station.
Speaker 6 (13:16):
Yes He's a fifty Morning at five on fifty five
KRZ the talkstation.
Speaker 5 (13:21):
All Worth Financial a registered investment advisory firm. Any ideas
presented during this program are not intended to provide specific
financial advice. You should consult your own financial advisor, tax consultant,
or a state planning attorney to conduct your own due diligence.
Speaker 3 (13:40):
You're listening to Simply Money, presided by all Worth Financial.
I'm Bob Sponseller along with Brian James from Madeira to Mason.
You've got questions, We've got answers. Don't miss today's Ask
the Advisors segment coming up at six forty three. There's
a new study out tonight that confirms what we encounter
from time to time and with our clients. Brian, many
(14:01):
people are absolutely terrified of running out of Money. Data
from the Alliance for Retirement Income reveals that fifty four
percent of Baby Boomers and Generation X combined are fearful
about outliving their savings, and that's up from forty eight
percent last year. And a Vanguard study said the average
(14:22):
four oh one K balance for Americans age fifty five
to sixty four is only two hundred and seventy one
thousand dollars right now, Brian, Yeah, so.
Speaker 7 (14:31):
This hits close to home because we're talking where we're
talking about both of us.
Speaker 1 (14:35):
Both those generations include Bob and Brian.
Speaker 7 (14:37):
And you know, I still think of myself as one
of these young, rebellious pearl jam fans that Gen X
was known to be in Nirvana and all that, which
I never really was.
Speaker 3 (14:44):
But anyway, just to clarify, just just so you don't
make me sound ancient here, I qualify for the Baby
boom generation by five days.
Speaker 7 (14:54):
So you and I hanging onto the bottom rung of
the ladder, that's right, that's right. I still look to
you your innergenerational sage like wisdom.
Speaker 2 (15:03):
All right, go ahead.
Speaker 7 (15:04):
But anyway, so, yeah, so these folks are fearful about
outliving their savings. That's the fifty four percent, like Bob said,
that's up last year was forty eight percent. And Bob,
I'm gonna throw out a bullet point that is not
in front of us. How many what percentage of people
do you think should be fearful but just have no idea?
If I'm fearful about my savings, that means I've at
least looked at my situation and I have some notion
that maybe it's not going to be enough.
Speaker 1 (15:26):
And how many people have just never looked at that.
Speaker 7 (15:28):
I have a situation right now where I'm opening somebody's
eyes to exactly what reality is, and it's well to
be quite frank.
Speaker 3 (15:35):
Brian, I have an opinion on that based on actual
client interaction. And I don't know if you find the
same thing, but I found I find often that the
people that should be fearful about running out of money aren't.
Speaker 2 (15:49):
They got their head in the sand. And the people
that have plenty of.
Speaker 3 (15:53):
Money put away and should have zero reason to fear
anything from a financial standpoint, those are the people that
are afraid to spend any money and go on a vacation.
Speaker 2 (16:02):
Do you ever find the same thing? I absolutely do.
Speaker 1 (16:04):
That's a great vit I even think about it that way.
Speaker 7 (16:06):
These surveys are great, these little bullet points we get
off the top end of them. But if you ask
somebody who spent you know, like you and I have
spent thirty years talking to people about this stuff, you
see it the other way around. Yeah, the people who
are paranoid are usually gonna be fine because we spend
a lot of our time. I'd spend ninety percent of
my time convincing people that it's okay to use what
they've built. And I say that I swear every even
five times a day in meetings with clients. You are
allowed to spend your own money. You're gonna be okay
(16:28):
versus you know, sometimes we'll run across somebody who just
hasn't ever sat down to have any idea.
Speaker 1 (16:34):
So, no, you are exactly right.
Speaker 7 (16:35):
And like I said, Bob, I appreciate your saves like wisdom,
and I look forward to sitting at your feet when
you retire and watching you with utch and spin yards.
Speaker 2 (16:42):
Yeah yeah, good, All right, Hey you brought up pearl jam.
Speaker 3 (16:46):
The people that aren't doing any financial planning, retirement savings
of all those are the people that are hanging out
at pearl Jam concerts every weekend, probably drinking and consuming
way too much of a whole bunch of things. And
those are the people we got to get in our
office and start saving for retirement.
Speaker 1 (17:03):
Says the guy from the hippie generation. Anyway, let's move
on to our next time.
Speaker 7 (17:08):
So there's another issue we'd run across a lot, So
a lot of people like we're talking about overly cautious.
Speaker 1 (17:13):
Let's talk about these folks.
Speaker 7 (17:14):
The Alliance for Lifetime Income found that forty seven percent
of retirees said spending money in retirement gives them anxiety,
and another one Employee Benefit Research Institute studies said retirees
with at least five hundred thousand had typically spent down
only eleven percent of their money within the first twenty
years of retirement. Twenty years of retirement, Bob, that's getting
me into my mid to late eighties most likely. And
(17:36):
so what they're saying is it's just not people aren't
spending down the way that they think they will. And
again that goes back to this paranoia. There's a lot
of people out there who have this fear of scarcity.
Therefore they don't spend money. Those are the ones you
and I are trying to shove out the door. I've
told my story a bunch of times about my favorite clients,
some of my favorite clients of all time, who canceled
a lifetime dream Hawaiian trip because the hot water heater died.
Speaker 1 (18:00):
They had no debt, three million dollars in the bank.
Speaker 7 (18:02):
They could have bought twenty hot water heaters just in
case and still done the trip.
Speaker 1 (18:05):
So we see it all the time.
Speaker 3 (18:07):
All Right, you're listening to Simple Money, presented by all
Worth Financial. I'm bob'spondseller along with Brian James. Let's get
into some of the challenges and the differences that we
see now between the Baby boom generation and the gen
X generation, because there are several more things that gen
X folks are needing to contend with here as they
(18:27):
navigate through pre retirement and retain.
Speaker 1 (18:29):
We thank you for your pity, Bob.
Speaker 2 (18:35):
All Right.
Speaker 3 (18:36):
What we're talking about here is something that I think
most people have heard of, this Sandwich generation. A lot
of people in their fifties and sixties are also shouldering
caregiving costs for parents, for spouses, sometimes for kids that
won't move out of the basement. There's a lot people
are juggling a lot of commitments perceived or real from
(18:59):
a financial state point that they feel like they got
to make and provide for other people, and that can
that can create some stress. And Brian, what's your recommendation
on how to deal with that stress?
Speaker 7 (19:11):
Well, first off, you know stress can be dealt with
by stress testing. So run your retirement income strategy through
some kind of tool that will that you where you
can say, here's the hunky dory outcome if nothing bad
ever happens again. You know this is this is after
we've already determined that, yes, I have a clear picture
what I think I need to spend, and I have
a clear picture what my resources are. Here's what it
looks like if nothing bad ever happens again. And then
(19:32):
what you should do is immediately run the exact same number,
same numbers, change one variable, just pretend that the market
somehow takes away twenty maybe twenty five percent. Those are
among the worst of the five worst years we've ever
had in the s and P. Five hundred, that's what
they've looked like, including the Great Depression two thousand and eight,
two thousand and.
Speaker 1 (19:47):
Two, and twenty two.
Speaker 7 (19:49):
Run it again, and see what the hit is and
see if you can take that and the way you
deal with this, you know, I think I think it's
important point to note, Bob, A lot of people have
a perception of what retirement is, and they're looking at
their forebears, their parents to their grandparents. Remember a lot
of those folks those generations had pensions. Most people nowadays
simply do not have a pension. So don't assume that
your retirement situation is going to look as comfortable as
(20:11):
those you might be modeling after. There could be very,
very different resources across those two groups, though, the answer
to that is, hey, we're all on our own.
Speaker 1 (20:18):
Maximize those contributions.
Speaker 7 (20:20):
Especially if you're fifty plus seventy, five hundred dollars more
can go into your four to one K and you
can throw one thousand dollars more into the IRA. If
you're sixty to sixty three, there's an extra enough new
goofy super catchup contribution that can get you to eleven
two fifty. Anyway, the point is make sure you're maxing
everything out.
Speaker 2 (20:35):
Here's the all Worth advice.
Speaker 3 (20:36):
Retirement anxiety is normal, but it's manageable. Run the numbers,
tap every retirement tool you have available and defend your
peace of mind with a clear, confident plan. Should you
be using AI to help you buy stuff? Our cybersecurity
expert is in to discuss that next. You're listening to
Simply Money, presented by all Worth Financial on fifty five
(20:58):
KRC the talkstation.
Speaker 1 (21:01):
Little do you Know It.
Speaker 6 (21:02):
We've been taking you back to school all summer.
Speaker 2 (21:06):
It sounds like.
Speaker 1 (21:07):
A high school term paper that got a lot more
continued education.
Speaker 4 (21:11):
Yeah, that's just smart.
Speaker 8 (21:12):
Fifty five KRC the talk station, he heart radio station.
Speaker 3 (21:22):
You're listening to Simply Money, presented by all Worth Financial
Lawnbomps bond Seller along with Brian James. Joined today by
our tech and AI and cybersecurity guru, mister Dave Hatter. Dave,
I can't wait to get your thoughts on this topic.
We came across an article recently where these AI tools
(21:42):
now you can tell them. For example, go out and
find me the best pair of gym shoes for under
one hundred dollars. Find the best quality pair of gym shoes,
find it, buy it, ship it to us, put it
on my visa card. Dave, I'll tell you right now,
there's no way in hell, I'm going to let some
computer do that for me.
Speaker 1 (22:04):
What say you?
Speaker 2 (22:05):
And what could possibly.
Speaker 3 (22:06):
Go wrong with this kind of quote unquote new and
exciting technology out there?
Speaker 9 (22:12):
Well, guys, as always, thanks for having me on, and
I think I'm glad you guys came up with this
as a topic to discuss because it touches on a
couple of things. There's this whole sort of new ish
field and AI called agentic AI or a AI agentics.
Speaker 4 (22:27):
You'll hear people say it both ways.
Speaker 9 (22:30):
And this goes beyond things like chat ept or crock
or other chatbot type systems where you sit down and
type in a prompt. The idea of agentic AI is
it essentially can act like a human.
Speaker 4 (22:43):
Being and take action on tasks.
Speaker 9 (22:46):
It has agency, right hence the name agentic and this
is sort of all the rage and the business.
Speaker 4 (22:52):
Now when you hear people talk.
Speaker 9 (22:54):
About how AI is going to put people out of
work and so forth, and when they're not talking about
super intelligence and artificial general intelligence, they're generally talking about
agentic AI, that these things are going to be set
up in this ai'll talk to that AI and it'll
do all of this stuff and work and we won't
need people anymore now, will we get there eventually? Maybe
I'm calling BS on it at the moment.
Speaker 4 (23:15):
And to answer your question specifically, Bob, No, there.
Speaker 9 (23:19):
Is absolutely not a chance in hell I would give
any sort of AI agent access to my bank accounts
or any financial system and then let it act on
my behalf. And I'll tell you why so, guys, I
spent twenty five years in this business before I sort
of transitioned into cybersecurity. As a software engineer. I wrote
(23:40):
millions of lines of code, built every kind of thing
you could imagine.
Speaker 4 (23:44):
And how many times do you.
Speaker 9 (23:46):
Think I created a bug in software and there were
unintended consequences? The answers a lot. I don't know how many.
How many times do you think I did that on purpose? Well,
the answer is never. But I'm a human being. I
make mistakes. And you know, one of the key problems
with AI to date is you have this idea of
hallucinations or confabulations where they just make things up. So
(24:07):
the idea that I'm going to trust some AI that's
a black box. I can't know what it does or
why it does it to control my money and take
actions on my behalf that involve my finances as far
as I'm concerned, completely insane, and there is no chance
I would do that.
Speaker 3 (24:21):
Kind of like asking Brian how many times he's taking
a client's money and put it in the stock market
and implied that there's no way you could lose money,
and then the stock market goes down eight percent?
Speaker 2 (24:31):
Is that kind of what you're talking about.
Speaker 9 (24:34):
Well, I don't know if i'd put Brian on the
spot like that, but yeah, be right back.
Speaker 1 (24:38):
I got to cancel a lot of calls here.
Speaker 9 (24:41):
I'm not saying there may not come a time in
the future. I mean where I might trust something like this,
although I'm super skeptical and again, spent twenty five years
writing software right now, not AI software, but writing software,
and in many cases, despite extensive testing, there were still
things that didn't work quite right, missed something over here,
or someone used the software in a way I did
(25:03):
not anticipate, and thus it didn't do what I expected
and something bad happened. So the idea that I'm going
to have a black box where I can't really know
how it works and it has known faults, right, So
from this article it came from Mark and Watch I
encourage people they should go read this for themselves if
they're thinking this is a good idea.
Speaker 4 (25:21):
They do a really good job.
Speaker 9 (25:22):
Of touching on many of the problems.
Speaker 4 (25:24):
I would see with something like this. But I just
want to read this to you.
Speaker 9 (25:27):
The tendency for AI to makes seemingly confident but potentially
wrong assumptions is getting worse. And this is the idea
of hallucination or confabulation, that they just make things up.
Recent analysis by The New York Times reveals a troubling paradox.
The most advanced AI systems are becoming more convincing, yet
are still more prone to hallucination. Open AI's newest quote
reasoning models unquote invent facts fifty one to seventy nine
(25:50):
percent of the time, compared with forty four percent for
older version, while Google Engineer's report they're reducing hallucination is
now the quote fundamental blocker unquote to wider AIA deployment.
Speaker 4 (26:01):
So when you know this going into it, and.
Speaker 9 (26:04):
You know that often it will not only hallucinate, this
is all well documented. Guys will not only hallucinate, but
then work hard to convince you what it's telling you,
which is patently false is correct as a problem not
to mention the privacy issues of this, the issues with
these things being hacked, the idea that, you know, if
a hacker could somehow get into your account, whether they
(26:24):
hack the back end of the agentic AI or they
just take over your account, that suddenly you could have
an avalanche of spending. You know, are these things really
making the best decisions on your behalf or are there
a bias in the models where they're actually picking more
expensive things rather than buying the thing.
Speaker 4 (26:38):
That would be the best fit for you. Hard to say,
those are all risks.
Speaker 9 (26:42):
And again, guys, I'm just telling you now. Everyone that
knows me knows I'm the ten foil hat guy. I'm
always the doomed guy because I know how this stuff
works to a large extent, I've been doing this for
a long time. Again, at some point in the future,
would there become a time where I might trust something
like this. Maybe, But we are still fairly in the
infancy of this, and I there is absolutely zero chance
(27:04):
I would let any sort of AI agent act on
my behalf with anything financial.
Speaker 7 (27:09):
So first thing I want to say is I do
use AI. I use chat GPT, we use copilots. Sometimes
it really is a wonderful tool for like Google on steroids,
when trying to put a puzzle together for somebody, or
answer questions about how some works or whatever. It is
a fantastic tool for that. However, can you imagine choosing
a surgeon or some kind of medical advisor whose stated
(27:29):
goal in the short term is to reduce the hallucinations.
It really seems like not the greatest idea. But I
want to take this in a slightly different direction. So Dave,
you've expressed your concerns from the technological standpoint, and that
makes it a lot of sense. We appreciate you're on
this side with us to help us understand that. Part
my brain goes to the regulatory stuff, so I am
not permitted to send out an email to all of
(27:51):
my clients without it having it being reviewed by you.
Speaker 1 (27:55):
Know a lot of compliance departments.
Speaker 7 (27:56):
And legal people who help us protect ourselves and our
clients and so forth.
Speaker 2 (28:00):
You know, there are good processes in place for that.
Speaker 7 (28:02):
I have to get I have to take continuing education
to keep up on my Certify Financial Planner degree and
all these other things. Some people are licensed and there's
lots of requirements there who at some point one regulatory body,
and there are many of them. The sec or fin
or whoever is going to have to say, hey, wait
a minute, these robots are providing advice and people are
apparently listening to it. We probably got to have eyeballs
(28:23):
on that, and then they're going to look under the
hood to figure out what is the motivation. So I'm
looking at this part of this article that refers to
sponsored results, meaning what stops somebody from throwing you know,
a language model out there that will gear somebody towards
certain products. That's illegal for a fiduciary advisor to do.
But what stops a computer? You know, the regulators are
going to have to step in on this. Have you
(28:44):
heard anything on the regulatory side of that kind of thing.
Speaker 4 (28:47):
Not specifically, but I'll answer that in a second. You
brought up a really good point.
Speaker 9 (28:51):
You know, I use this stuff myself. I prefer Rock
in general. You know, copilots built into the Microsoft platform,
and I would tell if folks from a chatout perspective again,
forget these automated agents. You know, if you understand the
risks of your data being exposed through the model to
someone else, of getting you know, false answers and things
like that. They can be like rocket tool for you
(29:14):
from a productivity standpoint. So I'm not suggesting to people
there's no value in this or they should avoid AI
in general. In fact, I encourage everyone check it out
for themselves. You'll have a better understanding of where this
stuff is at. But this agentic AI again, this black
box thing that's going to act on your behalf. And
then to your point, Brian, about the fiduciary ENNGLO of this, Yeah,
I mean, this whole agentic thing is still new. I've
(29:35):
not heard any sort of rumblings about the fiduciary aspect
and regulation around the financial interface of this.
Speaker 4 (29:42):
I mean, for the most part, all this stuff is
still the wild wild West.
Speaker 9 (29:45):
You know, we're kind of inter race with other adversarial
nations like China to try to be first on some
of this stuff so that it doesn't become a strategic
advantage and potentially a military advantage. But you know, there's
really almost no regulation around any of this. And I
think you make it really good point. The whole idea
in that article they call it sponsored results risk. Yeah, again,
(30:06):
these things are a black box and even if you
didn't have algorithmic bias in the agent, there might be
bias in the training data or someone behind the scenes,
because it would be very difficult to figure out. I mean,
that's one of the risks they point out, and I
think legitimate one and another reason why I would never
use anything like this in the near future.
Speaker 3 (30:22):
Because always from our tech expert Dave Hatter, thanks as
always for joining us. You're listening to Simply Money, presented
by all Worth Financial on fifty five KRC, the talk station.
Speaker 2 (30:33):
Who wants to be Rich?
Speaker 4 (30:34):
We call them every day millionaires every day listen to
Dave Ramsey.
Speaker 10 (30:39):
They typically say one of the things that turned their
life around was when they started looking at purchasing something rich.
People ask how much broke people and I've been both
brother okay broke. People ask how much down and how
much a month?
Speaker 6 (30:56):
Tonight at seven oh six started asking how much fide
krs the talkstation.
Speaker 2 (31:03):
I do think he is too old to run.
Speaker 6 (31:05):
In twenty twenty four, fifty five KRS the talkstation.
Speaker 3 (31:14):
You're listening to Simply Money, presented by all Worth Financial
on Bob Sponseller along with Brian James.
Speaker 2 (31:19):
Do you have a financial question you'd like for us
to answer.
Speaker 3 (31:21):
There is a big red button you can click while
you're listening to the show right on the iHeart app.
Simply record your question and it will come straight to us,
all right. David in Columbia Tusculum leads us off Brian.
He asks, how do I avoid being pushed into higher
Medicare premiums because of my RMD distributions?
Speaker 7 (31:42):
So David apparently is run into that time of life
where the financial questions are no longer so simple. I
always tell my younger clients, hey, you know, when you're
twenty and thirty years old, you're just trying not to
make a mess. Be aggressive with your investments, don't panic
when the market wobbles, and don't make a mess of
your credit. Do that for thirty years and you'll be fine.
Then you run into questions like what David has, where
obviously there's enough money that's coming out where his rmds
(32:04):
might be pushing him into a situation where the Medicare
organization says, hey, you need to pay a little bit
more for care. So the way this works, there's something
out there called IRMA IRMAA and that covers that is
basically a calculation that looks at your Medicare premiums, and
it will look for if you're married, income of two
hundred and six thousand dollars and half of that one
hundred and three thousand. If you're single. You go above
(32:25):
that income wise, and your rmds, I'm sorry, your Medicare
premiums are going to start to rise a little bit.
So required minimum distributions are a whole other concept. They
this is what happens if you have a pre tax
IRA or four oh one K, and then the IRS
eventually is going to force you to start taking money
out of that. And IRS doesn't care what you do
with it. They're simply saying you have to remove it
(32:45):
from the tax shelter, and then some percentage of that
total amount is going to be taxed. It's in the
ballpark of four percent maybe of your prior year end IRA.
So in other words, you've got a million dollar IRA,
then yes, you have forty thousand dollars worth of taxable
income that can push those IRMA Medicare premiums up. What
am I gonna do about it? This is where roth
conversions in your sixties, right that window between when you
(33:06):
have really low income. I've retired, maybe I'm living off
savings best case scenario, or maybe it's only social Security.
Therefore I'm in the lowest bracket I've seen in forever.
Do some ROTH conversions use up some of those low brackets.
You'll lower your future rm ds. You can also do
qualified charitable distributions. This is a This is your RMD,
your requirement of distribution going straight to a charity, but
it keeps it out of your modified adjusted gross income.
(33:27):
To help you avoid that, and then figure out how
to how to do your withdrawals tax efficiently. Coordinate your
taxable and your ROTH accounts first to smooth over that income.
All right, long underd answer there, But let's move on
to Elaine and Madeira.
Speaker 2 (33:38):
Bob's gone.
Speaker 3 (33:40):
I feel like David just got a full blown retirement
seminar in about three minutes. But sentiment in all right,
Come all right, Elaine and Madeira, and I'll take this one,
she says, with so many options right now, ETFs, buffer, ETFs,
direct investing, How do I or direct indexing? How do
I pick the best core investment strategy for a three
(34:01):
million dollar portfolio?
Speaker 2 (34:03):
Well, you bring up a lot of good stuff here, elane.
You know involving taxes.
Speaker 3 (34:08):
You know with direct indexing BUFFERDTS has to do with
managing investment volatility. We need to know how much of
that money is in qualified accounts iras four oh one
ks versus taxable accounts. There's a lot to balance here,
and I don't want to make this sound overwhelming, but
you know you need to sit down and develop your
risk tolerance, your cash flow needs, and then have that
(34:32):
result in an investment strategy that dovetails with a good, solid,
tax efficient income distribution strategy. And that's where sitting down
with a good fiduciary advisor that could walk you through
all that might be of help here. That'd be my recommendation.
If this is something you don't feel like you want
(34:52):
to take on yourself, get some help, partner with a
good fiduciary advisor. All right, Tom and Anderson township asks
are actively managed funds? Ever worth it if I already
own the indexes and I'm in.
Speaker 7 (35:06):
A higher tax bracket. Yeah, So this is this is
a pretty common question. You know, what we're talking about
active versus passive. Active means there's a person or a
group of persons sitting on top of a pile of
money saying we like this investment we want we don't
like this investment, We're going to buy this and sell that,
versus a passive investments which simply follows an index, So
an index such as the S and P five hundred,
(35:26):
which is nothing more than the five hundred largest companies
in the United States. So I would say, yeah, there
are times where active management is worth it, but I
don't view that in terms of beating the market quote unquote.
Where where we have at times employed active management is
in when we have kind of unique situations and we
want human brains versus blind indexes. So, for example, we
have we've have a generation and a half of people
(35:48):
who have really never seen interest rates doing what they're
doing over.
Speaker 1 (35:51):
The past three years.
Speaker 7 (35:52):
Prior to that, interest rates went down and sat on
the floor forever. Now, all of a sudden, we're in
a different situation. We've got fiscal policy and monetary policy
moving in directions we haven't ever had before, a lot
of politicization of things. I want active management sitting on
top of some of these bonds to basically protect from
some risk as opposed to just sitting on an index.
Speaker 1 (36:10):
That's how I currently feel. I'm happy with that.
Speaker 7 (36:12):
But I think that's a place, you know, for again,
for very unique situations, for a corner of the portfolio.
I don't need a human brain to tell me it's
a good idea to own the S and P. Five
hundred though. All right, we got time for one more,
so we're gonna throw it to Ken and Mason. Ken's
wondering how far out he needs to think when it
comes to tax Planning's tax planning just to this year thing?
Speaker 1 (36:29):
Or do I need to think out into the future?
Speaker 4 (36:30):
Bob?
Speaker 3 (36:32):
Yeah, I think you need to go out you know,
one five, ten years, even twenty or thirty years. And
here's what I mean by that. We're talking about what
is that RMD situation going to look like going out
longer term? And this is where the more proactive you
can get with your actual financial and cash flow plan
and tax planning, the better off you're gonna be. So
(36:54):
definitely sit down and map out some strategies and model
it out. If I do this, how does it look
one year, five years, ten years, fifteen years from now?
And that typically results in some pretty good planning. All right,
are folks choosing love over money? Or money over love.
For a growing number of Americans, they're trying to juggle
(37:15):
both and h it gets very complicated. We'll explain what
we mean next. You're listening to Simply Money, presented by
all Worth Financial. Fifty five KRC the talk station, News
when it happens, breaking news tonight, we are coming to you.
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Live news when you need it.
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You're going to want to listen to this news.
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Like this, keeping you up to date on what's happening.
This is going to be quite the event tonight.
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You're going to want to bet church to leave the
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of the hour. Fifty five KRZ the talk Station.
Speaker 3 (38:08):
You're listening to Simple Money, presented by all Worth Financial
on Bob Sponseller along with Brian James. There are a
zillion studies out there that show that money is a
major stressor in relationships. We see it every day, but
for some Brian, money ends up being the glue that
holds marriages or relationships together. There's a new survey out,
(38:30):
you know, from Chime and Talker research. You, being this
sharp gen X gentleman that you probably live on chime
every day, talk about this study.
Speaker 2 (38:41):
Tell us what we're talking about here.
Speaker 7 (38:43):
I don't know what chime is, but thank you for
the stereotype there, Bob, My goodness anyway, So yeah, new
survey here, This basically is one in five Americans say
they're staying in a romantic relationship because of financial reasons.
And this there's always loaded to this, right. This is
never as simple as it sounds. So this is we're
talking about shared bank accounts, a mortgage with two names
(39:05):
on it. You know, the cost of splitting up generally
is keeping people together, whether the romance is there or not.
Now I'm dealing with a situation in this case right now.
And sometimes it's the headline is it's the finances keeping together.
But I'm gonna get serious here for a second. It's
really the kids. Because you know, if you're trying to
make it in today's world, life is expensive, and the
(39:25):
kids cost what they cost, and all of a sudden,
now we have to split up the same amount of
income because people don't change their jobs over this usually
because you kind of can't. But now all of a
sudden that you have to figure out how these two
incomes are going to support two households in which the
same group of kids is going to live.
Speaker 1 (39:38):
And it is extremely hard. This is not just struggling
young adults.
Speaker 7 (39:42):
This happens at every stage, right people with the relationship
falls apart. Toward the end, it can get even scarier
because then there's real assets, very complex portfolios out there,
So there's a lot of things that are that can
come out, real estate investments, estate plans, all of this stuff.
It all has to kind of work together over time.
Money can hide these problems, either if there are too
(40:02):
much if there's you know, I don't know if there's
any sex things too much money, but but the plenty
of assets to rely on can mask the fact that
the that there are holes underneath the surface that we
can't see. So if you've kind of combined your finances,
but you have two different, very different financial lifestyles, that's
gonna go that's gonna surface eventually be a real problem.
Speaker 1 (40:21):
I'm sure you've seen this too, Bob.
Speaker 3 (40:22):
Yeah, I'm dealing with the situation right now where this
couple has pretty much been separated for seven to eight
years and they're just now getting around to actually finalizing
a divorce.
Speaker 2 (40:34):
And it's everything you just talked about.
Speaker 3 (40:36):
You know, they want to keep the kids stable, There's
affordability issues with keeping the house, a lot of things
that where money issues have just caused this relationship not
to end, probably when it should have. And that comes
by I guess this comes back to the major point,
you know, aligning your values, you know when it comes
(40:57):
to money is a key part of your marriage.
Speaker 2 (40:59):
And the sooner you can do that, the better.
Speaker 3 (41:01):
Here's the all Worth advice is if money is keeping
you together, make sure it's also bringing you closer.
Speaker 2 (41:07):
Thanks for listening.
Speaker 3 (41:08):
You've been listening to Simply Money and presented by all
Worth Financial on fifty five KRC the Talk Station, Mark Levin,
this is why I feel you and I we have
a special relationship. I don't deal well with Washington, I
don't deal well with cliques. Just being honest with you.
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Tonight at ten oh six on fifty five KRS, the
Talk station
Everything we do we keep you informed.
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Is FYI for your information. We'll have the latest information.
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Listen just FYI fifty five KRC the talk station.
Speaker 2 (00:35):
Tonight.
Speaker 3 (00:36):
How a Cincinnati financial advisor's criminal plea is impacting trust
in the wealth management world locally, and what thoughtful investors
should know Right now, you're listening to Simply Money, presented
by all Worth Financial on Bob's on Seller along with
Brian James.
Speaker 2 (00:52):
Imagine this.
Speaker 3 (00:53):
You're an investor in Cincinnati, living comfortably, stable family, trusted
financial advisory, money invested in annuities, maybe change your life
insurance policy.
Speaker 2 (01:05):
Beneficiaries around.
Speaker 3 (01:07):
Everything feels great until one day you discover your money
wasn't actually invested at all.
Speaker 2 (01:13):
That's exactly what clients of John J.
Speaker 3 (01:16):
Cursey, a former Northwestern Mutual advisor here in Cincinnati, say
they discovered Brian.
Speaker 2 (01:23):
Pretty shocking, but reasons to watch out.
Speaker 7 (01:27):
Here a little bit, right, Yeah, just another cautionary tale.
And the reason we're talking about this is because mister
Kursey did plead guilty the other day to stealing eight
point six million dollars from his clients over about twenty
years at Northwestern Mutual now Northwestern Mutual, to their credit,
did fully reimburse all the affected clients for their losses.
So this time, you know, it was a It was
(01:48):
a bullet dodge for a lot of people. But it's
just a cautionary tale for the kinds of things that
people are susceptible to. So how did he do all this, Bob, Well,
there were a lot of multiple planes regulatory filings. I
had not heard of this gentleman until this, and I
did I quickly found. You can see it all on
broker check, by the way, get to know broker check.
If you're going to hire a new advisor, you can
go see if there's been any complaints about him, about them,
(02:10):
him or her, And in this case, they're sure were
so uh on things like he instructed clients to write
personal checks directly to him.
Speaker 1 (02:17):
That is a major major red flag.
Speaker 7 (02:19):
And he just told him the money I'm gonna take
this money, it's gonna go in your insurance policies, these
annuities and trusts and whatever. But instead, mystically the manager
of the money just kind of disappeared. He attracted people
to do this with promises of you know that we
hear this all the time. I've got this secret idea
that nobody knows about. It's going to and I guarantee
you five to five and a half percent, which is
kind of crazy now because now that's that's a really
(02:40):
good marimony market fund from not that long ago. But
he was doing this during a time period where the
banks were paying absolutely nothing and he was claiming he
could get five five and a half percent guaranteed. So
these are again, if you run across this stuff, run
the other way.
Speaker 3 (02:54):
Yeah, And I think this story is not so much
about you know, Jay Kersey or Northwestern Well, by the way,
I mean, I've competed against Northwestern Mutual for decades, very
reputable firm. There are a ton of really good advisors
with that firm, So this is not a slam at
all at them. The main points we're trying to drive
(03:16):
home here is never write a check to any person
you know posing as a financial advisor. The check all
always needs to be made, paid to an investment custodial
firm like Fidelity Schwab wherever the investment money is actually held,
or directly to the insurance company. Never write a check
(03:38):
to a person, no matter how much you like them,
love them, trust them. You know, they're your neighbor, they
go to your church. Never write a personal check to
a person for investing. And I think the other thing,
the other thing here, Brian, that we came across in
this story, and believe it or not, some clients gave
mister Kersey blank checks, you know, put dollar amount and
(04:00):
left the did not write, you know, anything on where
the money was going. That's another huge red flag never
to do. And I think this, you know, he's been
an advisor, was an advisor since nineteen eighty six, you know,
he came into this business about five years before I did.
Speaker 2 (04:18):
So I'd run across.
Speaker 3 (04:19):
Him just reviewing client statements and things. And again, like
I said, our firms, you know, competed against one another,
so I'd run across his name. But I think I
think this goes back to the same the same way
clients got involved with Bernie Madoff. I mean this situation here,
nine ten million dollars is kind of a mini Birdie
(04:41):
madeoff type of situation, but the fact pattern is the same.
You know, blank checks, fictitious statements, all that. And I
guess that leads to another point that I want to
drive home here. You know, it takes you three to
five minutes to call an actual firm if you ever
have an any questions about where is my money?
Speaker 2 (05:02):
Can I have an account statement? All of that.
Speaker 3 (05:05):
I mean, most of this stuff is all online right now,
or all of it is. But if you're kind of
old school or you've had this stuff, you know, you
don't work on computers a whole lot, and you just
want to see a paper statement. You can call any
reputable office, including Northwestern Mutual by the way, and somebody
will print out and mail or email to you an
(05:26):
actual account statement. And that way you can know and
have things verified. Hey, I sent this money in, I
want to see evidence that it's been invested, and I
want to see evidence on a company account statement that
the money actually exists. So those are the main things
we're trying to call out here today.
Speaker 7 (05:44):
Yeah, and I want to make sure yet you're right,
this is not not to detegrate another firm out there
at Northwestern Mutual is very very well respected firm. But
this just kind of goes to show too, it's not
that hard to be a dirtbag in this industry, quite frankly.
And this is all attributed to court documents. Finally, is
this is that we're not reporting hearsay or anything. This
is all available in the court case because the guilty
(06:04):
plea happened the other day. So, you know, I think
the fact that the firm didn't have any record of
this and he was an employee, but think about this.
He convinced people to write blank checks, to write checks
to him. So what is to stop someone else from
creating a business card that says, hey, I work for
Northwestern Mutual or Fidelity Investments or or heck, you know
(06:25):
all Worth Financial.
Speaker 1 (06:26):
Right, This is how easy it is. You got to
have your guard up.
Speaker 7 (06:28):
As somebody is sitting in your kitchen table and they
show you a piece of paper with a logo and
a name on it, Think of how easy it was
to create that.
Speaker 1 (06:35):
So, just like Bob is.
Speaker 7 (06:36):
Saying, you know, this is something to always be super
wary of. Is So now, what are the in result
of this. Well, he pled guilty to fraud. He's been
barred by THINRA, which is the securities regulatory body, and
there's been at least fourteen complaints involving more than twelve
million dollars in alleged losses. So and so this is
obviously his career is over. He's going to go to
jail for a decent amount of time. But let it
(06:57):
be a lesson to be very vigilant on these things.
Speaker 3 (07:00):
Yeah, and again to repeat, you know, Northwestern Mutual, to
no one's surprise, stepped up and made all these clients whole.
And but you know what a huge cost to their
reputation and to say nothing in the money that they
had to dole out. And it's just a very very
sad situation. And like you said, Brian, anybody could pull
this off if they have the intention of defrauding people.
(07:22):
So the point is, have all your ducks in a row,
verify every transaction, and make sure you're getting statements from
the actual custodian insurance company what have you. Don't just
take anybody's word on it, you know, and when they say,
well we've invested it at a guaranteed five and a
half percent, you know, and in this case, this guy,
(07:44):
I guess, you know, like Bernie Madoff, created fictitious statements
and people were led to believe they were real, very
very very sad situation.
Speaker 4 (07:54):
Yep.
Speaker 7 (07:54):
And I think this is a great chance to go
over just what are the other things out there? What
else can happen? So there's there just to kind of
give an idea. This one close to home because there
are a lot of people listening to this, probably recognizing
the name, so you know that that can be helpful,
you know, kind of knowing the environment, the group that
he was in. But the other kind of things out
there that we're seeing a lot of what are called
(08:15):
romance and pig butchering scams. This is where a fraudster
will kind of build trust over time and then push
people into fake crypto investments. For example, FBI is stating
that losses are over four and a half billion dollars
here from twenty twenty four. From that kind of thing.
There's also, of course medicare and health scams. You might
get calls, in fact, we all get calls offering free
medical equipment, genetic testing. These are really just attempts tore
(08:38):
to steal Medicare information and you know, use your record
to apply for benefits. There super extra dangerous right now
because open enrollment is coming up. IRS tax scams are
out there. You'll get emails and tax claiming that your
tax refund is waiting in such instut state or whatever,
and they're fake threats of arrest for unpaid taxes. As
we always say, do not respond to anything except a
(08:59):
paper letter from the IRS, and even then call the
IRS directly, you know, look it up online and call
that number and they'll pull your record up and see
what's going on. You may even still get that the
letter itself could be fake at this point. But the
IRS of course, will never call you. They will never
text you, They will not email you. That is all scams.
The IRS will only send you letters Tech support scams,
of course, you know a lot of times firms can
(09:23):
or scammers can get a little cookie on your computer
that brings up a red screen that says, hey, you
have viruses, call this one eight hundred number and we
will fix it.
Speaker 1 (09:31):
Well, it's not really a virus.
Speaker 7 (09:33):
It's literally just a pop up to scare the daylights
out of you and get you to write a check
and rest assured if they get you to write one check,
they may come back years later, since you trusted them once,
they may come back and want thousands of dollars.
Speaker 1 (09:45):
And frankly, they honestly, they get it more often than not.
Speaker 7 (09:48):
And of course there's always phishing, defake scams, lots of
things like that, So lots of things to be to
pay attention to and be aware of.
Speaker 3 (09:55):
Yeah, and I want to talk about one more thing,
you know, with the case we're talking about here, you know,
with this fraud case, because I'm thinking of you know
how nine to twelve million dollars over a thirty five
to forty year career is not a lot of money
in proportion of the amount of money that this individual
was handling on the behalf on behalf of clients.
Speaker 2 (10:14):
Here's what I mean by that.
Speaker 3 (10:16):
If I had to guess, I'm saying, I would guess
that eighty to ninety five percent of all transactions that
this gentleman did with his clients were completely legitimate. They
were verified on statements and all that. And when you
the point is, when you get you start working with
higher net worth people two three, four, five, ten million dollars,
(10:37):
you can easily if you get people to write a
check you know personally to you, you can easily skim
off five seven thousand dollars at a pop, and it
takes thirty five forty years for that to add up
to nine to twelve million dollars. And for people that
trust the advisor don't check transaction summaries. And let's face it,
(10:58):
a ten million dollar portfolio can move around by eight
to nine thousand dollars, you know, in an hour. So
I think a lot of people just trust don't check things,
and that's how money can get skimmed.
Speaker 2 (11:11):
And I can totally see how this happened.
Speaker 3 (11:15):
So again the reminder every time you write a check
that and this is just the law, this is how
this works. You should be receiving a written confirmation and
a transaction summary. And a lot of people hate to
have their mailbox cluttered with paper or emails and sometimes
Brian people complain to us about it. Why am I
getting so much stuff? Well, this is why we are
(11:37):
trying to verify that every penny that you send to us,
we are telling you where it went, how it was invested,
the date, the amount, all that, and there's a reason
behind that. Hopefully we have illustrated that for everyone today.
One more quick point comes up frequently.
Speaker 7 (11:55):
There's a lot of people out the other are kind
of a verse to using online for financial reasons, such
as the people I've never set up my online banking
because i want to keep it protected. I've never gone
online from a sociecurity information and all that kind of thing. Remember,
if you have not set up your profile, then anyone
out there with enough information about you can set it
up on your behalf using their own contact information, their
(12:15):
own password. Now they got you, so it's in my
I believe now that you are actually more exposed if
you don't use these services than if you set them
up yourself. If you set it up yourself and somebody
changes the password, you're going to get notified fifteen different ways.
Versus if you never set it up and I have
never seen the site, You're going to have no idea
that it even happened.
Speaker 2 (12:32):
Excellent point. Here's the all Worth advice.
Speaker 3 (12:34):
The best defense against financial fraud isn't trust its due diligence,
check credentials, confirm every transaction, and ask the tough questions
before you sign anything coming up next. For many, retirement
should feel like freedom not fear, will show you ways
to ensure that that fear component doesn't happen to you.
(12:57):
You're listening to Simply Money, presented by all Worth Financials
along fifty five KRC, the Talk.
Speaker 8 (13:02):
Station fifty five KRC Cincinnati, available everywhere with the iHeartRadio
app now number one for podcasting. Fifty five KRC an
iHeartRadio station.
Speaker 6 (13:16):
Yes He's a fifty Morning at five on fifty five
KRZ the talkstation.
Speaker 5 (13:21):
All Worth Financial a registered investment advisory firm. Any ideas
presented during this program are not intended to provide specific
financial advice. You should consult your own financial advisor, tax consultant,
or a state planning attorney to conduct your own due diligence.
Speaker 3 (13:40):
You're listening to Simply Money, presided by all Worth Financial.
I'm Bob Sponseller along with Brian James from Madeira to Mason.
You've got questions, We've got answers. Don't miss today's Ask
the Advisors segment coming up at six forty three. There's
a new study out tonight that confirms what we encounter
from time to time and with our clients. Brian, many
(14:01):
people are absolutely terrified of running out of Money. Data
from the Alliance for Retirement Income reveals that fifty four
percent of Baby Boomers and Generation X combined are fearful
about outliving their savings, and that's up from forty eight
percent last year. And a Vanguard study said the average
(14:22):
four oh one K balance for Americans age fifty five
to sixty four is only two hundred and seventy one
thousand dollars right now, Brian, Yeah, so.
Speaker 7 (14:31):
This hits close to home because we're talking where we're
talking about both of us.
Speaker 1 (14:35):
Both those generations include Bob and Brian.
Speaker 7 (14:37):
And you know, I still think of myself as one
of these young, rebellious pearl jam fans that Gen X
was known to be in Nirvana and all that, which
I never really was.
Speaker 3 (14:44):
But anyway, just to clarify, just just so you don't
make me sound ancient here, I qualify for the Baby
boom generation by five days.
Speaker 7 (14:54):
So you and I hanging onto the bottom rung of
the ladder, that's right, that's right. I still look to
you your innergenerational sage like wisdom.
Speaker 2 (15:03):
All right, go ahead.
Speaker 7 (15:04):
But anyway, so, yeah, so these folks are fearful about
outliving their savings. That's the fifty four percent, like Bob said,
that's up last year was forty eight percent. And Bob,
I'm gonna throw out a bullet point that is not
in front of us. How many what percentage of people
do you think should be fearful but just have no idea?
If I'm fearful about my savings, that means I've at
least looked at my situation and I have some notion
that maybe it's not going to be enough.
Speaker 1 (15:26):
And how many people have just never looked at that.
Speaker 7 (15:28):
I have a situation right now where I'm opening somebody's
eyes to exactly what reality is, and it's well to
be quite frank.
Speaker 3 (15:35):
Brian, I have an opinion on that based on actual
client interaction. And I don't know if you find the
same thing, but I found I find often that the
people that should be fearful about running out of money aren't.
Speaker 2 (15:49):
They got their head in the sand. And the people
that have plenty of.
Speaker 3 (15:53):
Money put away and should have zero reason to fear
anything from a financial standpoint, those are the people that
are afraid to spend any money and go on a vacation.
Speaker 2 (16:02):
Do you ever find the same thing? I absolutely do.
Speaker 1 (16:04):
That's a great vit I even think about it that way.
Speaker 7 (16:06):
These surveys are great, these little bullet points we get
off the top end of them. But if you ask
somebody who spent you know, like you and I have
spent thirty years talking to people about this stuff, you
see it the other way around. Yeah, the people who
are paranoid are usually gonna be fine because we spend
a lot of our time. I'd spend ninety percent of
my time convincing people that it's okay to use what
they've built. And I say that I swear every even
five times a day in meetings with clients. You are
allowed to spend your own money. You're gonna be okay
(16:28):
versus you know, sometimes we'll run across somebody who just
hasn't ever sat down to have any idea.
Speaker 1 (16:34):
So, no, you are exactly right.
Speaker 7 (16:35):
And like I said, Bob, I appreciate your saves like wisdom,
and I look forward to sitting at your feet when
you retire and watching you with utch and spin yards.
Speaker 2 (16:42):
Yeah yeah, good, All right, Hey you brought up pearl jam.
Speaker 3 (16:46):
The people that aren't doing any financial planning, retirement savings
of all those are the people that are hanging out
at pearl Jam concerts every weekend, probably drinking and consuming
way too much of a whole bunch of things. And
those are the people we got to get in our
office and start saving for retirement.
Speaker 1 (17:03):
Says the guy from the hippie generation. Anyway, let's move
on to our next time.
Speaker 7 (17:08):
So there's another issue we'd run across a lot, So
a lot of people like we're talking about overly cautious.
Speaker 1 (17:13):
Let's talk about these folks.
Speaker 7 (17:14):
The Alliance for Lifetime Income found that forty seven percent
of retirees said spending money in retirement gives them anxiety,
and another one Employee Benefit Research Institute studies said retirees
with at least five hundred thousand had typically spent down
only eleven percent of their money within the first twenty
years of retirement. Twenty years of retirement, Bob, that's getting
me into my mid to late eighties most likely. And
(17:36):
so what they're saying is it's just not people aren't
spending down the way that they think they will. And
again that goes back to this paranoia. There's a lot
of people out there who have this fear of scarcity.
Therefore they don't spend money. Those are the ones you
and I are trying to shove out the door. I've
told my story a bunch of times about my favorite clients,
some of my favorite clients of all time, who canceled
a lifetime dream Hawaiian trip because the hot water heater died.
Speaker 1 (18:00):
They had no debt, three million dollars in the bank.
Speaker 7 (18:02):
They could have bought twenty hot water heaters just in
case and still done the trip.
Speaker 1 (18:05):
So we see it all the time.
Speaker 3 (18:07):
All Right, you're listening to Simple Money, presented by all
Worth Financial. I'm bob'spondseller along with Brian James. Let's get
into some of the challenges and the differences that we
see now between the Baby boom generation and the gen
X generation, because there are several more things that gen
X folks are needing to contend with here as they
(18:27):
navigate through pre retirement and retain.
Speaker 1 (18:29):
We thank you for your pity, Bob.
Speaker 2 (18:35):
All Right.
Speaker 3 (18:36):
What we're talking about here is something that I think
most people have heard of, this Sandwich generation. A lot
of people in their fifties and sixties are also shouldering
caregiving costs for parents, for spouses, sometimes for kids that
won't move out of the basement. There's a lot people
are juggling a lot of commitments perceived or real from
(18:59):
a financial state point that they feel like they got
to make and provide for other people, and that can
that can create some stress. And Brian, what's your recommendation
on how to deal with that stress?
Speaker 7 (19:11):
Well, first off, you know stress can be dealt with
by stress testing. So run your retirement income strategy through
some kind of tool that will that you where you
can say, here's the hunky dory outcome if nothing bad
ever happens again. You know this is this is after
we've already determined that, yes, I have a clear picture
what I think I need to spend, and I have
a clear picture what my resources are. Here's what it
looks like if nothing bad ever happens again. And then
(19:32):
what you should do is immediately run the exact same number,
same numbers, change one variable, just pretend that the market
somehow takes away twenty maybe twenty five percent. Those are
among the worst of the five worst years we've ever
had in the s and P. Five hundred, that's what
they've looked like, including the Great Depression two thousand and eight,
two thousand and.
Speaker 1 (19:47):
Two, and twenty two.
Speaker 7 (19:49):
Run it again, and see what the hit is and
see if you can take that and the way you
deal with this, you know, I think I think it's
important point to note, Bob, A lot of people have
a perception of what retirement is, and they're looking at
their forebears, their parents to their grandparents. Remember a lot
of those folks those generations had pensions. Most people nowadays
simply do not have a pension. So don't assume that
your retirement situation is going to look as comfortable as
(20:11):
those you might be modeling after. There could be very,
very different resources across those two groups, though, the answer
to that is, hey, we're all on our own.
Speaker 1 (20:18):
Maximize those contributions.
Speaker 7 (20:20):
Especially if you're fifty plus seventy, five hundred dollars more
can go into your four to one K and you
can throw one thousand dollars more into the IRA. If
you're sixty to sixty three, there's an extra enough new
goofy super catchup contribution that can get you to eleven
two fifty. Anyway, the point is make sure you're maxing
everything out.
Speaker 2 (20:35):
Here's the all Worth advice.
Speaker 3 (20:36):
Retirement anxiety is normal, but it's manageable. Run the numbers,
tap every retirement tool you have available and defend your
peace of mind with a clear, confident plan. Should you
be using AI to help you buy stuff? Our cybersecurity
expert is in to discuss that next. You're listening to
Simply Money, presented by all Worth Financial on fifty five
(20:58):
KRC the talkstation.
Speaker 1 (21:01):
Little do you Know It.
Speaker 6 (21:02):
We've been taking you back to school all summer.
Speaker 2 (21:06):
It sounds like.
Speaker 1 (21:07):
A high school term paper that got a lot more
continued education.
Speaker 4 (21:11):
Yeah, that's just smart.
Speaker 8 (21:12):
Fifty five KRC the talk station, he heart radio station.
Speaker 3 (21:22):
You're listening to Simply Money, presented by all Worth Financial
Lawnbomps bond Seller along with Brian James. Joined today by
our tech and AI and cybersecurity guru, mister Dave Hatter. Dave,
I can't wait to get your thoughts on this topic.
We came across an article recently where these AI tools
(21:42):
now you can tell them. For example, go out and
find me the best pair of gym shoes for under
one hundred dollars. Find the best quality pair of gym shoes,
find it, buy it, ship it to us, put it
on my visa card. Dave, I'll tell you right now,
there's no way in hell, I'm going to let some
computer do that for me.
Speaker 1 (22:04):
What say you?
Speaker 2 (22:05):
And what could possibly.
Speaker 3 (22:06):
Go wrong with this kind of quote unquote new and
exciting technology out there?
Speaker 9 (22:12):
Well, guys, as always, thanks for having me on, and
I think I'm glad you guys came up with this
as a topic to discuss because it touches on a
couple of things. There's this whole sort of new ish
field and AI called agentic AI or a AI agentics.
Speaker 4 (22:27):
You'll hear people say it both ways.
Speaker 9 (22:30):
And this goes beyond things like chat ept or crock
or other chatbot type systems where you sit down and
type in a prompt. The idea of agentic AI is
it essentially can act like a human.
Speaker 4 (22:43):
Being and take action on tasks.
Speaker 9 (22:46):
It has agency, right hence the name agentic and this
is sort of all the rage and the business.
Speaker 4 (22:52):
Now when you hear people talk.
Speaker 9 (22:54):
About how AI is going to put people out of
work and so forth, and when they're not talking about
super intelligence and artificial general intelligence, they're generally talking about
agentic AI, that these things are going to be set
up in this ai'll talk to that AI and it'll
do all of this stuff and work and we won't
need people anymore now, will we get there eventually? Maybe
I'm calling BS on it at the moment.
Speaker 4 (23:15):
And to answer your question specifically, Bob, No, there.
Speaker 9 (23:19):
Is absolutely not a chance in hell I would give
any sort of AI agent access to my bank accounts
or any financial system and then let it act on
my behalf. And I'll tell you why so, guys, I
spent twenty five years in this business before I sort
of transitioned into cybersecurity. As a software engineer. I wrote
(23:40):
millions of lines of code, built every kind of thing
you could imagine.
Speaker 4 (23:44):
And how many times do you.
Speaker 9 (23:46):
Think I created a bug in software and there were
unintended consequences? The answers a lot. I don't know how many.
How many times do you think I did that on purpose? Well,
the answer is never. But I'm a human being. I
make mistakes. And you know, one of the key problems
with AI to date is you have this idea of
hallucinations or confabulations where they just make things up. So
(24:07):
the idea that I'm going to trust some AI that's
a black box. I can't know what it does or
why it does it to control my money and take
actions on my behalf that involve my finances as far
as I'm concerned, completely insane, and there is no chance
I would do that.
Speaker 3 (24:21):
Kind of like asking Brian how many times he's taking
a client's money and put it in the stock market
and implied that there's no way you could lose money,
and then the stock market goes down eight percent?
Speaker 2 (24:31):
Is that kind of what you're talking about.
Speaker 9 (24:34):
Well, I don't know if i'd put Brian on the
spot like that, but yeah, be right back.
Speaker 1 (24:38):
I got to cancel a lot of calls here.
Speaker 9 (24:41):
I'm not saying there may not come a time in
the future. I mean where I might trust something like this,
although I'm super skeptical and again, spent twenty five years
writing software right now, not AI software, but writing software,
and in many cases, despite extensive testing, there were still
things that didn't work quite right, missed something over here,
or someone used the software in a way I did
(25:03):
not anticipate, and thus it didn't do what I expected
and something bad happened. So the idea that I'm going
to have a black box where I can't really know
how it works and it has known faults, right, So
from this article it came from Mark and Watch I
encourage people they should go read this for themselves if
they're thinking this is a good idea.
Speaker 4 (25:21):
They do a really good job.
Speaker 9 (25:22):
Of touching on many of the problems.
Speaker 4 (25:24):
I would see with something like this. But I just
want to read this to you.
Speaker 9 (25:27):
The tendency for AI to makes seemingly confident but potentially
wrong assumptions is getting worse. And this is the idea
of hallucination or confabulation, that they just make things up.
Recent analysis by The New York Times reveals a troubling paradox.
The most advanced AI systems are becoming more convincing, yet
are still more prone to hallucination. Open AI's newest quote
reasoning models unquote invent facts fifty one to seventy nine
(25:50):
percent of the time, compared with forty four percent for
older version, while Google Engineer's report they're reducing hallucination is
now the quote fundamental blocker unquote to wider AIA deployment.
Speaker 4 (26:01):
So when you know this going into it, and.
Speaker 9 (26:04):
You know that often it will not only hallucinate, this
is all well documented. Guys will not only hallucinate, but
then work hard to convince you what it's telling you,
which is patently false is correct as a problem not
to mention the privacy issues of this, the issues with
these things being hacked, the idea that, you know, if
a hacker could somehow get into your account, whether they
(26:24):
hack the back end of the agentic AI or they
just take over your account, that suddenly you could have
an avalanche of spending. You know, are these things really
making the best decisions on your behalf or are there
a bias in the models where they're actually picking more
expensive things rather than buying the thing.
Speaker 4 (26:38):
That would be the best fit for you. Hard to say,
those are all risks.
Speaker 9 (26:42):
And again, guys, I'm just telling you now. Everyone that
knows me knows I'm the ten foil hat guy. I'm
always the doomed guy because I know how this stuff
works to a large extent, I've been doing this for
a long time. Again, at some point in the future,
would there become a time where I might trust something
like this. Maybe, But we are still fairly in the
infancy of this, and I there is absolutely zero chance
(27:04):
I would let any sort of AI agent act on
my behalf with anything financial.
Speaker 7 (27:09):
So first thing I want to say is I do
use AI. I use chat GPT, we use copilots. Sometimes
it really is a wonderful tool for like Google on steroids,
when trying to put a puzzle together for somebody, or
answer questions about how some works or whatever. It is
a fantastic tool for that. However, can you imagine choosing
a surgeon or some kind of medical advisor whose stated
(27:29):
goal in the short term is to reduce the hallucinations.
It really seems like not the greatest idea. But I
want to take this in a slightly different direction. So Dave,
you've expressed your concerns from the technological standpoint, and that
makes it a lot of sense. We appreciate you're on
this side with us to help us understand that. Part
my brain goes to the regulatory stuff, so I am
not permitted to send out an email to all of
(27:51):
my clients without it having it being reviewed by you.
Speaker 1 (27:55):
Know a lot of compliance departments.
Speaker 7 (27:56):
And legal people who help us protect ourselves and our
clients and so forth.
Speaker 2 (28:00):
You know, there are good processes in place for that.
Speaker 7 (28:02):
I have to get I have to take continuing education
to keep up on my Certify Financial Planner degree and
all these other things. Some people are licensed and there's
lots of requirements there who at some point one regulatory body,
and there are many of them. The sec or fin
or whoever is going to have to say, hey, wait
a minute, these robots are providing advice and people are
apparently listening to it. We probably got to have eyeballs
(28:23):
on that, and then they're going to look under the
hood to figure out what is the motivation. So I'm
looking at this part of this article that refers to
sponsored results, meaning what stops somebody from throwing you know,
a language model out there that will gear somebody towards
certain products. That's illegal for a fiduciary advisor to do.
But what stops a computer? You know, the regulators are
going to have to step in on this. Have you
(28:44):
heard anything on the regulatory side of that kind of thing.
Speaker 4 (28:47):
Not specifically, but I'll answer that in a second. You
brought up a really good point.
Speaker 9 (28:51):
You know, I use this stuff myself. I prefer Rock
in general. You know, copilots built into the Microsoft platform,
and I would tell if folks from a chatout perspective again,
forget these automated agents. You know, if you understand the
risks of your data being exposed through the model to
someone else, of getting you know, false answers and things
like that. They can be like rocket tool for you
(29:14):
from a productivity standpoint. So I'm not suggesting to people
there's no value in this or they should avoid AI
in general. In fact, I encourage everyone check it out
for themselves. You'll have a better understanding of where this
stuff is at. But this agentic AI again, this black
box thing that's going to act on your behalf. And
then to your point, Brian, about the fiduciary ENNGLO of this, Yeah,
I mean, this whole agentic thing is still new. I've
(29:35):
not heard any sort of rumblings about the fiduciary aspect
and regulation around the financial interface of this.
Speaker 4 (29:42):
I mean, for the most part, all this stuff is
still the wild wild West.
Speaker 9 (29:45):
You know, we're kind of inter race with other adversarial
nations like China to try to be first on some
of this stuff so that it doesn't become a strategic
advantage and potentially a military advantage. But you know, there's
really almost no regulation around any of this. And I
think you make it really good point. The whole idea
in that article they call it sponsored results risk. Yeah, again,
(30:06):
these things are a black box and even if you
didn't have algorithmic bias in the agent, there might be
bias in the training data or someone behind the scenes,
because it would be very difficult to figure out. I mean,
that's one of the risks they point out, and I
think legitimate one and another reason why I would never
use anything like this in the near future.
Speaker 3 (30:22):
Because always from our tech expert Dave Hatter, thanks as
always for joining us. You're listening to Simply Money, presented
by all Worth Financial on fifty five KRC, the talk station.
Speaker 2 (30:33):
Who wants to be Rich?
Speaker 4 (30:34):
We call them every day millionaires every day listen to
Dave Ramsey.
Speaker 10 (30:39):
They typically say one of the things that turned their
life around was when they started looking at purchasing something rich.
People ask how much broke people and I've been both
brother okay broke. People ask how much down and how
much a month?
Speaker 6 (30:56):
Tonight at seven oh six started asking how much fide
krs the talkstation.
Speaker 2 (31:03):
I do think he is too old to run.
Speaker 6 (31:05):
In twenty twenty four, fifty five KRS the talkstation.
Speaker 3 (31:14):
You're listening to Simply Money, presented by all Worth Financial
on Bob Sponseller along with Brian James.
Speaker 2 (31:19):
Do you have a financial question you'd like for us
to answer.
Speaker 3 (31:21):
There is a big red button you can click while
you're listening to the show right on the iHeart app.
Simply record your question and it will come straight to us,
all right. David in Columbia Tusculum leads us off Brian.
He asks, how do I avoid being pushed into higher
Medicare premiums because of my RMD distributions?
Speaker 7 (31:42):
So David apparently is run into that time of life
where the financial questions are no longer so simple. I
always tell my younger clients, hey, you know, when you're
twenty and thirty years old, you're just trying not to
make a mess. Be aggressive with your investments, don't panic
when the market wobbles, and don't make a mess of
your credit. Do that for thirty years and you'll be fine.
Then you run into questions like what David has, where
obviously there's enough money that's coming out where his rmds
(32:04):
might be pushing him into a situation where the Medicare
organization says, hey, you need to pay a little bit
more for care. So the way this works, there's something
out there called IRMA IRMAA and that covers that is
basically a calculation that looks at your Medicare premiums, and
it will look for if you're married, income of two
hundred and six thousand dollars and half of that one
hundred and three thousand. If you're single. You go above
(32:25):
that income wise, and your rmds, I'm sorry, your Medicare
premiums are going to start to rise a little bit.
So required minimum distributions are a whole other concept. They
this is what happens if you have a pre tax
IRA or four oh one K, and then the IRS
eventually is going to force you to start taking money
out of that. And IRS doesn't care what you do
with it. They're simply saying you have to remove it
(32:45):
from the tax shelter, and then some percentage of that
total amount is going to be taxed. It's in the
ballpark of four percent maybe of your prior year end IRA.
So in other words, you've got a million dollar IRA,
then yes, you have forty thousand dollars worth of taxable
income that can push those IRMA Medicare premiums up. What
am I gonna do about it? This is where roth
conversions in your sixties, right that window between when you
(33:06):
have really low income. I've retired, maybe I'm living off
savings best case scenario, or maybe it's only social Security.
Therefore I'm in the lowest bracket I've seen in forever.
Do some ROTH conversions use up some of those low brackets.
You'll lower your future rm ds. You can also do
qualified charitable distributions. This is a This is your RMD,
your requirement of distribution going straight to a charity, but
it keeps it out of your modified adjusted gross income.
(33:27):
To help you avoid that, and then figure out how
to how to do your withdrawals tax efficiently. Coordinate your
taxable and your ROTH accounts first to smooth over that income.
All right, long underd answer there, But let's move on
to Elaine and Madeira.
Speaker 2 (33:38):
Bob's gone.
Speaker 3 (33:40):
I feel like David just got a full blown retirement
seminar in about three minutes. But sentiment in all right,
Come all right, Elaine and Madeira, and I'll take this one,
she says, with so many options right now, ETFs, buffer, ETFs,
direct investing, How do I or direct indexing? How do
I pick the best core investment strategy for a three
(34:01):
million dollar portfolio?
Speaker 2 (34:03):
Well, you bring up a lot of good stuff here, elane.
You know involving taxes.
Speaker 3 (34:08):
You know with direct indexing BUFFERDTS has to do with
managing investment volatility. We need to know how much of
that money is in qualified accounts iras four oh one
ks versus taxable accounts. There's a lot to balance here,
and I don't want to make this sound overwhelming, but
you know you need to sit down and develop your
risk tolerance, your cash flow needs, and then have that
(34:32):
result in an investment strategy that dovetails with a good, solid,
tax efficient income distribution strategy. And that's where sitting down
with a good fiduciary advisor that could walk you through
all that might be of help here. That'd be my recommendation.
If this is something you don't feel like you want
(34:52):
to take on yourself, get some help, partner with a
good fiduciary advisor. All right, Tom and Anderson township asks
are actively managed funds? Ever worth it if I already
own the indexes and I'm in.
Speaker 7 (35:06):
A higher tax bracket. Yeah, So this is this is
a pretty common question. You know, what we're talking about
active versus passive. Active means there's a person or a
group of persons sitting on top of a pile of
money saying we like this investment we want we don't
like this investment, We're going to buy this and sell that,
versus a passive investments which simply follows an index, So
an index such as the S and P five hundred,
(35:26):
which is nothing more than the five hundred largest companies
in the United States. So I would say, yeah, there
are times where active management is worth it, but I
don't view that in terms of beating the market quote unquote.
Where where we have at times employed active management is
in when we have kind of unique situations and we
want human brains versus blind indexes. So, for example, we
have we've have a generation and a half of people
(35:48):
who have really never seen interest rates doing what they're
doing over.
Speaker 1 (35:51):
The past three years.
Speaker 7 (35:52):
Prior to that, interest rates went down and sat on
the floor forever. Now, all of a sudden, we're in
a different situation. We've got fiscal policy and monetary policy
moving in directions we haven't ever had before, a lot
of politicization of things. I want active management sitting on
top of some of these bonds to basically protect from
some risk as opposed to just sitting on an index.
Speaker 1 (36:10):
That's how I currently feel. I'm happy with that.
Speaker 7 (36:12):
But I think that's a place, you know, for again,
for very unique situations, for a corner of the portfolio.
I don't need a human brain to tell me it's
a good idea to own the S and P. Five
hundred though. All right, we got time for one more,
so we're gonna throw it to Ken and Mason. Ken's
wondering how far out he needs to think when it
comes to tax Planning's tax planning just to this year thing?
Speaker 1 (36:29):
Or do I need to think out into the future?
Speaker 4 (36:30):
Bob?
Speaker 3 (36:32):
Yeah, I think you need to go out you know,
one five, ten years, even twenty or thirty years. And
here's what I mean by that. We're talking about what
is that RMD situation going to look like going out
longer term? And this is where the more proactive you
can get with your actual financial and cash flow plan
and tax planning, the better off you're gonna be. So
(36:54):
definitely sit down and map out some strategies and model
it out. If I do this, how does it look
one year, five years, ten years, fifteen years from now?
And that typically results in some pretty good planning. All right,
are folks choosing love over money? Or money over love.
For a growing number of Americans, they're trying to juggle
(37:15):
both and h it gets very complicated. We'll explain what
we mean next. You're listening to Simply Money, presented by
all Worth Financial. Fifty five KRC the talk station, News
when it happens, breaking news tonight, we are coming to you.
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You're going to want to listen to this news.
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Like this, keeping you up to date on what's happening.
This is going to be quite the event tonight.
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Speaker 3 (38:08):
You're listening to Simple Money, presented by all Worth Financial
on Bob Sponseller along with Brian James. There are a
zillion studies out there that show that money is a
major stressor in relationships. We see it every day, but
for some Brian, money ends up being the glue that
holds marriages or relationships together. There's a new survey out,
(38:30):
you know, from Chime and Talker research. You, being this
sharp gen X gentleman that you probably live on chime
every day, talk about this study.
Speaker 2 (38:41):
Tell us what we're talking about here.
Speaker 7 (38:43):
I don't know what chime is, but thank you for
the stereotype there, Bob, My goodness anyway, So yeah, new
survey here, This basically is one in five Americans say
they're staying in a romantic relationship because of financial reasons.
And this there's always loaded to this, right. This is
never as simple as it sounds. So this is we're
talking about shared bank accounts, a mortgage with two names
(39:05):
on it. You know, the cost of splitting up generally
is keeping people together, whether the romance is there or not.
Now I'm dealing with a situation in this case right now.
And sometimes it's the headline is it's the finances keeping together.
But I'm gonna get serious here for a second. It's
really the kids. Because you know, if you're trying to
make it in today's world, life is expensive, and the
(39:25):
kids cost what they cost, and all of a sudden,
now we have to split up the same amount of
income because people don't change their jobs over this usually
because you kind of can't. But now all of a
sudden that you have to figure out how these two
incomes are going to support two households in which the
same group of kids is going to live.
Speaker 1 (39:38):
And it is extremely hard. This is not just struggling
young adults.
Speaker 7 (39:42):
This happens at every stage, right people with the relationship
falls apart. Toward the end, it can get even scarier
because then there's real assets, very complex portfolios out there,
So there's a lot of things that are that can
come out, real estate investments, estate plans, all of this stuff.
It all has to kind of work together over time.
Money can hide these problems, either if there are too
(40:02):
much if there's you know, I don't know if there's
any sex things too much money, but but the plenty
of assets to rely on can mask the fact that
the that there are holes underneath the surface that we
can't see. So if you've kind of combined your finances,
but you have two different, very different financial lifestyles, that's
gonna go that's gonna surface eventually be a real problem.
Speaker 1 (40:21):
I'm sure you've seen this too, Bob.
Speaker 3 (40:22):
Yeah, I'm dealing with the situation right now where this
couple has pretty much been separated for seven to eight
years and they're just now getting around to actually finalizing
a divorce.
Speaker 2 (40:34):
And it's everything you just talked about.
Speaker 3 (40:36):
You know, they want to keep the kids stable, There's
affordability issues with keeping the house, a lot of things
that where money issues have just caused this relationship not
to end, probably when it should have. And that comes
by I guess this comes back to the major point,
you know, aligning your values, you know when it comes
(40:57):
to money is a key part of your marriage.
Speaker 2 (40:59):
And the sooner you can do that, the better.
Speaker 3 (41:01):
Here's the all Worth advice is if money is keeping
you together, make sure it's also bringing you closer.
Speaker 2 (41:07):
Thanks for listening.
Speaker 3 (41:08):
You've been listening to Simply Money and presented by all
Worth Financial on fifty five KRC the Talk Station, Mark Levin,
this is why I feel you and I we have
a special relationship. I don't deal well with Washington, I
don't deal well with cliques. Just being honest with you.
Speaker 6 (41:22):
Tonight at ten oh six on fifty five KRS, the
Talk station
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