August 28, 2025 • 41 mins
On today’s episode of Simply Money presented by Allworth Financial, the President takes aim at the Fed, Kroger announces 1,000 job cuts, and Bob and Brian break down why your “diversified” portfolio might not be as safe as you think. Plus, the rise of elder scams, and your questions on taxes, retirement planning, and charitable trusts.
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Episode Transcript
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Speaker 1 (00:00):
This free off is a the American people are authentic
voices fifty five kars he the talk station.
Speaker 2 (00:15):
Tonight, more turbulence regarding the relationship between our president and
the Federal Reserve and Cincinnati's largest public company announces a
thousand job cuts.
Speaker 3 (00:27):
You're listening to Simply Money, presented by Allworth Financial. I'm
Bob Sponseller along with Brian James.
Speaker 4 (00:32):
Well.
Speaker 3 (00:33):
Brian, for the first time in modern history, a city
US president has fired, or at least tried to fire
a Federal Reserve governor.
Speaker 4 (00:41):
Update us on what's going on here, Well, big headlines here.
This is some some unprecedented actions here to follow the
unprecedented actions we've kind of seen all year long, as
we've got somebody with a little bit of a new approach.
So so President Trump declared he had terminated Federal Reserve
Governor Lisa Cook. He's using her of this is a
quote having a long tracord of housing, a track record
(01:03):
of housing market manipulation and unethical mortgage dealings. That's a
quote direct for the president. Uh. Not not a lot
of evidence yet that's coming, of course, That's something now
that we're living in the age of social media and headlines.
We start with the accusations first, we don't back them
up with evidence. That's where we are right now. That's
coming should be fairly easy to determine whether this is
a thing that actually happened or not. She's accused of
(01:25):
having misstated the whether which residence was her primary residence. Obviously,
for your primary residence, you get the best interest rate
you can possibly get. If it's a secondary residence that's
considered an investment property, and then you don't you get
to pay a little more for that because it's more
of a business transaction. That is the accusation U. And
so we'll have to wait to see what more comes
(01:46):
of this, to see if there's if there's truth to it.
If there is, then well, yeah, that's probably not a
good look for a federal or to serve governor somebody
at that level should be probably be thinking a little
bit differently. But that's where we are today. Yeah, it's
not a good look.
Speaker 3 (01:59):
It's it's all so, and you know, you run the
course of you run the risk of upsetting anybody anytime
you give an opinion. But I really wish the president,
you know, we still live in a country where you
are you are innocent until proven guilty?
Speaker 4 (02:14):
And uh, I think the facts are out.
Speaker 3 (02:17):
You know, you got to let the facts come out
on this stuff before you go fire somebody or even
fire off tweets on social media. If FED Governor Cook,
you know, violated federal mortgage law, she probably deserves to,
you know, need to step down from her spot. But
I what what upsets people, you know, in general and
(02:37):
in the financial markets and all that is when we
get this volatile you know, immediate texting and social media
post especially by the President of the United States, that's
unsettling for a lot of people. And you know, personally,
I wish he.
Speaker 4 (02:51):
Wouldn't do that. So it calls into question the independence
of the.
Speaker 3 (02:56):
FED, which we've talked about and and will continue to
talk about here a little bit this morning.
Speaker 4 (03:02):
Yeah, and I think it's at least a Cook is
not really the issue here. I think the issue is
really what you just said, is if if she's convicted
or whatever or confirmed to have done these things, then yes,
she should lose her job and we should all move
on and then add her to the list of people
that maybe weren't quite on the up and up on
both sides of the aisle in a powerful position politically.
(03:22):
That that, to me is the small story. The bigger
story is it was the concern that the president is
looking for specific individuals who did certain things because he
wants to be able to create a spot to move
somebody in, you know, with good batter or right, wrong
or and different. That's what the discussion is, and that's
where the end of the discussion of independence comes. If
somebody wants to show, you know, a list of all
(03:44):
the every FED governor and here's what they may or
may not have done, and then we clean it up
that way, great, I'm fine with that. We're shining a
bright light into every corner. I'd like to see that
at every corner or every level of government clean up.
The mess is targeting, and we just want to get
rid of this person, and we're going to ignore what
the other stuff is done. Then that bring the question
of the independence of the FED into question, a sort
(04:04):
of a witch hunt of sorts to create a spot
to put in with somebody who will agree with you.
That's the concern. Whether it's valid or not, that's gonna
that's for the public to decide. But I think that's
really what the discussion is here.
Speaker 3 (04:15):
Yeah, in the delicate balance that we try to got,
you know, we try to walk here with the Federal
Reserve is they are supposed to be and largely are
an independent body. The governors are appointed by the presidents.
They serve what is it, fourteen year terms, but they're
not really accountable to anybody on a daily basis. So
(04:37):
you know, they sit there and they're independent, and we
hope they all follow the rules. We hope they all
work in the best interests of the country. But I
think we're all naive if we think that presidents and
their cabinet appointees don't meet with these Fed governors and
try to influence Federal Reserve policy. I think the difference
(04:58):
with this president. I mean, you go back fifty seventy years.
Every single president in history has had multiple meetings with
Federal Reserve chairman.
Speaker 4 (05:07):
That's nothing new.
Speaker 3 (05:08):
I think what's new with this president is we go
out on social media or in press conferences and we
just you know, pokem and produm and criticize them. That
is a new thing that again I wish would not happen,
and I think that can be unsettling for people.
Speaker 4 (05:25):
Yeah, it really can, and there is a little bit
of precedent for this. So this we went through this
not that long ago with Trump versus Wilcox. Here, So
when will Cox Kathy Harris were similar officials on two
different government boards, National Labor Relations and the Merit Systems
Protection Board. I don't know what that second one is,
to be quite honest, but anyway, earlier this year, President
(05:45):
Trump removed them despite specific statutes that prevents any president
from that protects those folks from being fired without cause.
Willcox should have been in her finishing her term until
twenty twenty eight, for example. So they both of those
people sue and they argue that their removal violated that
long standing statutory constitutional protection. And so that's where we
(06:06):
are now. The Supreme Court in May granted an emergency
stay of that lower court ruling, and so that one
is still being fought out. This is another one where
the there's where it's fairly black and white that the
president does not have the power to do this, but
whether that's actually going to be enforced is in question.
And again, lots of questions here, and I think the
smallest one of these is whether Lisa Wied on her
mortgage application. There are much bigger questions here. There are
(06:29):
plenty of able bodied people who can serve in the
role of board governor. We don't lose a ton if
one gets swapped out. That is not the question you're
listening to.
Speaker 3 (06:37):
Simply money present of by all Worth Financial on Bob's
funtseller along with Brian James all Right.
Speaker 4 (06:42):
Switching gears here.
Speaker 3 (06:43):
The other story that we're following Kroger, and we've known
about some of these job cuts announcements going back months
and months, but Kroger finally announced that it is cutting
one thousand corporate jobs in a major reorganization, and we
now know that that includes two hundred corporate jobs right
here in Cincinnati.
Speaker 4 (07:02):
Brian, Yeah, so this just happened the other day. So
fewer than one thousand corporate employees they are going to
be losing their jobs. But this does not include This
is mostly administrative headquarters type roles, store manufacturing, distribution staff
unaffected here. But Interim CEO Ron Sergeant said, this is
basically a strategic move to shift resources toward efforts that
(07:24):
better serve customers. And some of this is in reaction
to that failed merger with Albertson's that was shot down
for anti trust reasons not long ago, so they took
some financial hits from that, and so what they're trying
to do is get their profit margins back to where
they were, and these are some steps that they're taking
to go in that direction. So they had plans to
close they are already in June. They already had plans
(07:45):
to close about sixty underperforming stores over a year and
a half. That's about five percent of their twelve hundred locations,
and that's supposed to have about one hundred million dollar
charge financially speaking. So despite all of that, Kroger still
expects they're looking for a modest gain out of all this,
and they're looking to move those savings from these moves
into enhancing the customer experience and including you know, job
(08:08):
offers to employees from closing stores, trying to find work
for them somewhere that they actually need them. So there
is some efforts being made there as well. It's not
all about sick.
Speaker 3 (08:17):
Yeah, anytime you do a merger, I mean, let's face it,
Brian companies try to merge because they think there's some
efficiencies to be found there which improve profit margins. I mean,
that's part of merging and running a business. It's not
good for the people that are impacted, but it's just
part of how business works. And let's hope and pray
that those two hundred individuals in Cincinnati are able to
(08:38):
be you know, relocated within the company to another role
or laying on their feet in some way, which I'm
sure they will.
Speaker 4 (08:45):
You know, Kroger had.
Speaker 3 (08:46):
About fifty eight hundred employees in Greater Cincinnati as of
a year ago, four hundred and fourteen thousand employees in
total for the whole company. So again, when it impacts you,
it's a big deal. But two hundred employees, you know,
it's a percentage of the total, not a huge number.
Speaker 4 (09:06):
Yeah, and this is not the first time, even this
year that the Kroger has made this decision. So a
little earlier this year, the eighty four to fifty one company,
the Artist formerly known as dun Humby, laid off several
different positions just just in the idea of again cost cutting.
And they didn't really say exactly how many positions there
were at the time, but I know that just from
the phone calls that we received here from people who
(09:28):
are impacted by it. I know that was it was
probably a bigger number than what we might might anticipate. Now,
if you find yourself in this situation, Kroger or not, well,
this is where we come back and we talk about
guess what financial planning? Well, okay, this is a no
fun situation. How are we going to deal with it? Well,
hopefully you've got an emergency fund in place. Right. If
we lose a job, there's usually some kind of severance
(09:49):
package involved. Sometimes there's not. So that's why we need
to make sure and let's make sure that we know
what we're spending in the first place. Right, that's where
it all starts. Lay off or not understand which your
situation is, so that you can understand the packed of
some situation like this. Therefore, if I know what I'm
spending on a monthly basis, how much is three months,
six months, nine months of my expenses? Maybe twelve months
if you want to be super conservative, and then make
(10:10):
sure that dollar amount is accessible somewhere. That buys you
time to avoid running up credit card debts or tapping
into your longer term retirement savings, which is usually going
to come with taxes and penalties. Yeah.
Speaker 3 (10:21):
And the big thing that hits people, you know, out
of thin air, that they don't often think about and
they should is healthcare. You know, if you're someone impacted
by this layoff, look at the potential cobra coverage healthcare coverage. Again,
we have no idea about what severance packages are being
put out there, but make sure you're taking a good
hard look at how your healthcare is going to be
(10:42):
impacted and make sure you're covered there.
Speaker 4 (10:45):
Coming up next, you.
Speaker 3 (10:46):
Think you're diversified, We're going to break down why what
looks like a well balanced portfolio might actually be anything
but that you're listening to simply money. Presented by all
Worth Financial on fifty five KRC the talk station make.
Speaker 4 (11:00):
Us the number one preset on your car radio and
on the free Knew It Improved iHeartRadio app Free Never
sounded so good.
Speaker 5 (11:07):
Fifty five krc D Talk Station. Allworth 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 (11:29):
You're listening to Simply Money, presented by all Worth Financial
on Bob Sponseller along with Brian James. If you can't
listen to Simply Money live every night, subscribe to get
our daily podcasts. You can listen the following morning during
your commute to work or on your way to the
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Speaker 4 (11:48):
About us as well.
Speaker 3 (11:49):
Just search Simply Money on the iHeart app or wherever
you find your podcast. Well, Brian, yesterday we spent a
lot of time discussing the importance of diversific and as
we just said, if you missed it, we encourage you
to download yesterday's podcast. And if you're listening right now
thinking you are diversified, let's take a few more minutes
(12:11):
and make sure that's the case.
Speaker 4 (12:13):
Yeah, So let's talk about why the Sometimes we can
think we're diversified, but we're not. So the illusion of diversification.
So conventional wisdom says diversification is about spreading the risk.
If I own a bunch of different things, then I
then then know one of them can sink my ships.
And that pretty much is true from a very high level.
But what can look like diversification actually oftentimes is not.
(12:34):
You might have a whole bunch of different accounts, investment accounts,
or you might have a whole bunch of different investment
in ticker symbols on that quarterly statement. But that's not
really the point. If you can't just simply assume that
because you have a bunch of different things, that that's
really going to have the diversification effect that you need.
What matters is how those investments behave as a team,
individually and together under all these different market conditions. So
(12:57):
one of the biggest things that you need to look
for more of us own mutual funds or exchange traded
funds ETFs, UH and UH. The assumption can be, if
I have a bunch of these different ones, then I'm
properly diversified. However, your largest of large ETFs mutual funds
all are going to own Apple, Microsoft, Amazon and Video
and so forth. So while you may have a dozen
different funds in there, a lot of them are giving
you the exact same exposure. So I think back way
(13:19):
back to Bob, this will, this will, let's go, let's
take a wayback machine. As a financial advisor, I don't
know if you remember something called the Janice Big four
funds from the late nineties and early early two thousands.
Oh yeah, yep. Jannis Fund, Jannis twenty Fund, Mercury Fund,
and Worldwide Fund. These funds were just going gangbusters and
everybody decided, you know, it's all they need. There were
articles you were you were getting.
Speaker 3 (13:38):
We were getting twenty five, twenty seven, twenty eight percent
a year out of those suckers for a good four
to five six year run.
Speaker 4 (13:44):
It was great. Look at this, I've got a diversified
portfolio averaging me twenty five percent. What can go wrong
with this scenario? Well, here's what went wrong. The dot
com crash dragged them all underwater. Those the Big four
were heavily and concentrated in tech and telecom names. The
bubble burst from peak to trough, those four funds lost
sixty to eighty percent of their value, and that was
just devastating to people who had piled in at the top. Now,
(14:07):
if you were properly diversified, two thousand and one two
thousand and two were no fund But at the same time,
you can survive those types of things. But if you
truly did only look at last year's performance of these
various funds and invest that way, and lots of people
still do this. Unfortunately, then you did get hammered and
it hurt. Yeah, if you fast.
Speaker 3 (14:25):
Forward to today, I mean one company in particular that
happens to be reporting earnings after the bell, Navidia. It
now makes up eight and a half percent of the
cap weighted sm P five hundreds. So you look at
a lot of these big cap funds. You know, so
many of these mag seven big tech cap you know,
(14:46):
big tech companies make up such a big cap weighting
of the SMP that any hiccups at all among these
magnificent seven stocks are going to cause more volatility in
that S and P five hundred. So people think, well, hey,
I'm in the S and P five hundred, I'm diversified.
And to your point, Brian, if you look at the
holdings of these large cap growth funds, you might be
(15:08):
surprised that the holdings in them are almost, you know,
very close to identical.
Speaker 4 (15:13):
Because let's face it, the.
Speaker 3 (15:14):
Mutual fund industry, the managed money industry, they all talk
about beating the index.
Speaker 4 (15:19):
Well what is the index. It's the S and P
five hundred.
Speaker 3 (15:22):
None of them want to stick their neck out too
far and go away from that index because the minute
they quote unquote underperform, people fire them. So it's just
a herd mentality. And this cap weighting, you know, with
so much concentration in so few stocks, can leave you
with a portfolio that is way more volatile than you
(15:44):
might have bargained for. So what do we do about that, Brian,
in terms of building a nice, balanced, well diversified, truly
diversified portfolio.
Speaker 4 (15:53):
Yeah, so I want to start off by making sure
we understand what the problem is. So you used a
couple of words in there that I want that might
be new to some people. Half weighting, What does that mean? Well,
we talk about the S and P five hundred and
a lot of people are aware that's the five hundred
largest companies in the United States, good, bad, and different.
But the assumption can be that, well, that must be
my investment is divided evenly across those five hundred names
(16:14):
inside that mutual funder exchange traded fund. And that is
not the case. And that's the point Bob was making
as we're sitting here right now. The magnificent seven that's Apple, Microsoft,
and VideA, Amazon, Alphabet Meta, which is Facebook, and Tesla.
Those are about a third thirty four percent of the
S and P five hundred. If you invested in that
index fund, that's not a bad investment, but just know
that a fully a third of it is just those
(16:35):
seven companies. That's what CAF weighting means. The bigger the
company is, the more of a percentage of that index
that makes up there.
Speaker 3 (16:42):
And there are like S and P equal weight funds
out there and ETFs that you can invest in, so
there's a lot of different things you can do. What
we're trying the point we're trying to drive home here
is when we really look at risk management and how
assets work together, you have to look at how things correlate,
you know, bonds, stocks, emerging markets, international, small cap, mid cap,
(17:06):
large cap.
Speaker 4 (17:07):
That's really what.
Speaker 3 (17:08):
You want to build in terms of having a portfolio
that gives you the highest rate of return per unit
of risk. If risk is something you're even concerned about.
Speaker 4 (17:18):
Yeah, I want I want to share some of So
I think this is an interesting topic and I'm dragging
you down a little bit of a rabbit hole here,
but this whole cap weighted versus equal weighted discussion here.
So I just did a quick comparison since January of
two thousand and three, the equal weighted right, dividing it
evenly over five hundred holdings, that has outperformed only twelve
out of twenty one years. The cap weighted side, which
(17:40):
is what we normally, that's what you see at the
bottom of your TV screen every that's the version of
the S and P five hundred. That one, of course
has had the edge nine out of those years. So,
but the difference can be significant in the actual outperformance
because when we're in good years, when technology is going
great guns, then absolutely the cap weighted version will perform
better because seven of those stocks make up a third
(18:01):
of the S and P five hundred. But when those
stocks kind of hit the skids, like happened earlier this
year and a few years ago as well, when they
were all making tens of thousands of layoffs, then the
equal weighted version will be better. So are we saying
you should choose one or the other. No, The point
is you should understand what you own and how it
actually works, because what this means the technology can take
a massive hit technology sector and it'll drag the S
(18:21):
and P five hundred down the cap weighted version of it.
But that means maybe finance and insurance and defensive type
companies might be doing okay, you have to make sure
those are represented in your portfolio.
Speaker 3 (18:31):
You're listening to Simply Money presented by all Worth Financial
on Bob Sponseller along with Brian James.
Speaker 4 (18:36):
Hey, Brian.
Speaker 3 (18:36):
Something that comes up sometimes in the office when I
meet with prospective clients is this whole idea of advisor diversification.
Some people think if they've got two, three, four different
quote unquote advisors, that they're getting the best of all
worlds because they're getting all this different advice and they
can get all these ideas. You know, how does that
(18:58):
work in your world in real practice. I've got my
opinion on and I'm interested in yours.
Speaker 4 (19:04):
Sure, yeah, and my my thinking on that. What I
always tell people is if you if you're going to
have more than one advisor, first of all, it's your money.
You do the thing that puts you to sleep at night.
If you can sleep better having more people looking at it,
that's fine. However, that puts you ultimately in the position
of being an advisor. You're the CEO and you have
you know, now you have four vice presidents of you know,
four chief financial officers underneath you, all of whom are
(19:26):
going to give you their varying different opinions. And as
long as you've hired good, competent people, they're going to
be good opinions. But at the same time, you're going
to have to decide I'm going to listen to this one,
that one or the other one. And what I've found
is that most people wind up frustrated and just confused
because they're getting information from a bunch of different sources.
And what they do is they shut down and they
don't act on anything because they've got too much information
(19:47):
coming at them. So advisors are advisors are paid for
a reason. You need to trust them or not pay them.
If you're not going to act on the advice you're given,
you're being given and that includes if you're simply overwhelmed
with all the detail, then you need to question whether
that's the right approach for you. So I think it
creates more confusion than anything else. I could not put
that any better. Here's the all Worth advice.
Speaker 3 (20:09):
Real diversification isn't just owning a little bit of everything.
It's being smart about where your money's going, why it's there,
and what it's supposed to.
Speaker 4 (20:18):
Do for you.
Speaker 3 (20:18):
Make sure every dollar has a job, whether it's for growth,
income or leaving a legacy. You're listening to Simply Money,
presented by all Worth Financial on fifty five KRC the
talk station.
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What's Happening d one year in jail.
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Speaker 3 (20:54):
You're listening to Simply Money, presented by all Worth Financial
on Bob's sponseller along with Brian James. Joined tonight by
our technology and cybersecurity guru, mister Dave Hatter.
Speaker 4 (21:04):
Dave, it's always great to have you with us tonight.
Speaker 3 (21:08):
You want to talk about elder scams and this is
something that seems to be growing and growing in regularity,
and it's something we all need to be aware of
and make plans to prevent.
Speaker 6 (21:19):
Yeah, guys, sadly this appreciate you having me on. It's
always I think this is an important topic because you
know I have elderly parents. I know many of your
listeners do, and this is a growing concern. So just
one stat and this is a great site for folks,
by the way, just for general stats and information. The
Internet Crime Complaints Center IC three, which is run by
(21:40):
the FBI. They put out a fraud report every year
that's got all kinds of stats in it. And again
the site is just useful in a lot of ways.
I encourage people to bookmarkt IC three dot gov. Elderfrond
losses hit four point eight eight billion and twenty twenty four,
a staggering forty three percent jump from the previous year.
The average senior victim lost over eighty three thousand dollars.
(22:02):
And then another good site for some insight into this
is the Federal Trade Commission FTC FTC dot gov. So
here's a headline from a public service announcement they put out,
business and government impersonators go after older adults life savings.
Speaker 4 (22:16):
And then they have.
Speaker 6 (22:17):
Some stats in there too, and they say, in fact,
reported losses of over one hundred thousand dollars increase nearly
sevenfold from twenty twenty to twenty twenty four. So you know,
I hate to always be the doomsday guy, the guy
with the tenth fol hat, always warning about this stuff.
But you know, I don't want to see people lose
their entire life savings. And is we spend more time
(22:38):
online and every facet of our lives working, education, you know, school,
you name it, think about it. What are you not
doing online nowadays? It just creates that many more attack
vectors for the bad guys. You're throwing things like artificial
intelligence and the ability to generate, to clone someone's voice,
to generate incredibly realistic videos, incredibly realistic texts, to kind
(22:59):
of eliminate all the old school tells like well, I
got an email asking me to do something weird, and
I need to send gift cards to the hamlet, and
county sheriffs can to arrest me, but the grammars all
weird and so forth, All that's gone. The bad guys
have access to low cost or free tools that make
it really easy for them to run these sort of
scams at scale. And again, you don't have to take
(23:20):
my word for it. You can see what the FBI
is saying, You see what the FTC is saying. And
at one last point, and then I'll let you guys
start asking some specific questions. Is you know this again?
The documentation is all out there. The scams are increasing.
They're targeting elderly people in some cases, but you know,
we're all subject to all kinds of scams, and this
(23:40):
kind of education is important, as is a healthy dose
of skepticism and vigilance. You know, the Hamlet and County
sheriff is not going to call you and tell you
that because of a parking ticket, they're coming at three
to arrest you if you don't buy gift cards or
send an INMO payment, right, they don't operate that way.
Speaker 4 (23:57):
Hey, hey, Dave. So yeah, and then those those they
are all great examples. But you're right, this isn't new
news anymore. And I think the one, the one that
is new is the to me is the deep fake stuff.
I don't think we've even scratched the surface on that.
I have yet to hear a story, you know, about
somebody losing an awful lot of money yet to that,
but that is coming and it's gonna be huge. So
these articles you said is extremely helpful here, but they
(24:19):
reference an awful lot about cyber insurance. So I don't
want to drag you off course here, but is this
something that we should be considering. I mean, maybe we
all have home insurance, we have fire insurance, we got
flood insurance in some case. Is it we at a
point where we should all consider cyber insurance? Do you think? Uh?
Speaker 6 (24:33):
I think it's worth it as a business, absolutely, But
I also find that many small businesses that I talk
to about this stuff because on my real job, I'm
not talking about this all the time and trying to
help business.
Speaker 4 (24:45):
Come on, David, this is your real job.
Speaker 6 (24:47):
Yeah, you know, people will say, well, I've got cyber insurance.
I don't like to care about this, and I just
like to remind folks, well, your fire insurance does not
keep your building from burning down, you know, ideally it
helps you recover should that happen. So you can't just
say well, I got insurance, I'm good to go.
Speaker 7 (25:03):
Right.
Speaker 6 (25:03):
You need a strategy where you're trying to harden your environment,
defend yourself against these kind of attacks. Be smart, be vigilant,
move slow, and then you know, be resilient. Part of
that resilience, you know, in addition to backups and so forth,
might be insurance. You know, as an individual, does it
make sense to get some kind of personal cyber insurance? Maybe,
(25:24):
especially if you have a lot of risk if you're
a high net worth person.
Speaker 4 (25:28):
But I think there's a lot of things you can do. Guys.
Speaker 6 (25:30):
Again, the first step is always knowledge, right. I mean,
you can't defend against something you don't know about. Knowledge, skepticism.
It's doing the simple things we talk about all the time, strong,
unique passwords, multifacture authentication. It's also doing things like freezing
your credit. I'm sure you guys would agree. You know,
my card is frozen. Yeah, and until I need to
(25:51):
get credit, I keep it frozen. I unlock it when
I need it, and I lock it back. You know,
it's not foolproof, but you know you're raising the bar
making yourself a much more difficult target for the bad
guys because in most of these cases, especially you know,
these targeting of elders, they're not specifically targeting individuals. They're
going for low hanging fruit. And if you take the
(26:13):
kind of advice we're given out here, if you harden yourself,
if you do these basic practices, you're going to be
a much more difficult target. They're just going to move on.
And again, the skepticism, you know, I encourage any of
your listeners pick up the phone and try to call
Microsoft or Google and get help. And my point is
they are not looking at your computer and going, hey,
(26:33):
I think you've got a virus. I'm going to call
you up today and tell you let me help you
remove this virus. If you get a call, an unsolicited
call from a company that claims you have some kind
of virus and they want to help you, the likelihood
that that is not a scam is probably greater than
all three of us getting hit by a media right now,
it is a scam, right, So again, vigilance, knowledge, skepticism, and.
Speaker 4 (26:58):
You know, when you look at the numbers.
Speaker 6 (27:00):
One of these reports say there's eighty five trillion dollars
in wealth out there in the Baby Boom and Silent generation.
The bad guys know this, right, They know there's an
enormous amount of money. They know in a lot of cases,
older people may not even be aware that it's possible
to create a very you know, a perfect deep fake
audio or video. And you know, you guys mentioned there
(27:20):
is documented evidence already more in a corporate setting of
large scale fraud that's been perpetrated using deep fake voice
cloning and videos.
Speaker 4 (27:29):
I encourage your folks go look up the.
Speaker 6 (27:31):
Story about the Ferrari CFO who got a nearly got
deep fake voice cloned into fraud from the so called
Ferrari CEO. And these are people that know each other personally.
Speaker 4 (27:42):
This is the real gave us a segment maybe for
next week. I'm in right that one. Now. It's why
I wouldn't to look into it, well documented.
Speaker 3 (27:50):
Dave, I was going to ask about the whole phone
thing and voice cloning.
Speaker 4 (27:55):
Yeah, so I'll just ask it this way.
Speaker 3 (27:57):
I mean, are we now at a point where it's
just because I know what I do. I never answer
my phone ever, ever, ever, unless I know who's calling me,
I just don't answer my phone. Are we at the
point now where our advice to folks, especially elderly and
maybe vulnerable folks, just give that blanket advice, do not
(28:18):
answer your phone unless you know who it is.
Speaker 4 (28:21):
Are we at that point? Is that the best way
to protect folks?
Speaker 6 (28:25):
I think so I can tell you I do not
ever answer my phone from a number I don't recognize,
and I'm even sometimes skeptical if it is an number
I do recognize. Because keep in mind, guys, spoofing, which
in my mind is the biggest driver of all this
creating something that looks realistic but isn't. It's fairly easy
to do in any digital mechanism. It's really easy to
send a phone call from any number you want if
(28:47):
you know what you're doing, and it does not require
a lot of skills. So you know, if I could
find one of your two cell phone numbers, or if
I happen to have it, I could easily spoof a
call that would look like it came from your cell phone.
I could easily send a text that looks like it
comes from you. You know, same thing with emails. So skepticism, vigilance,
don't answer the phone if it's important. They'll leave a message,
or they'll contact you some other way. Go read what
(29:10):
the government says. You know, IRS, FBI. They are not
going to call you and tell you some terrible thing
is going to happen to you if you don't make
it in when a payment by five PM. They don't
operate that way, and they state that clearly on their
own websites. So again, there's tons of useful information out
there that can help people avoid these kind of scams.
Speaker 4 (29:29):
FTC dot gov, IC three dot gov.
Speaker 6 (29:32):
But it all starts with skepticism and caution like don't
answer your phone. If you don't recognize the number, they'll
leave a message, and if they don't, must not be important.
Speaker 4 (29:41):
All right, good stuff as always, Dave.
Speaker 3 (29:43):
You're listening to Simply Money, presented by all Worth Financial
on fifty five KRC, the Talk station, Mark Levin.
Speaker 7 (29:51):
You know, America, we spend an awful lot of time
in this country responding to an unreality created by the
people who hate America to buy people who get sucked
into the narratives that are pushed out there each and
every day. And they're posting, and they're posting, and they're posting,
and they'll move on to the next thing, and the
next thing and the next thing. That's what the media
enemy do.
Speaker 1 (30:11):
Mark Levin Tonight at ten oh six on fifty five KRS,
the talk station Finding Great Candidates.
Speaker 4 (30:19):
The hirings are welcome to here. Why do we keep
letting thousands of people come over and do nothing about it?
My family's safety.
Speaker 3 (30:25):
Is at risk.
Speaker 1 (30:26):
Fifty five KRC, the talk station. You're listening to Simply
Money and presented by all Worth Financial. I'm Bob sponsorller
along with Brian James. Do you have a financial question
you'd like for us to answer. There's a red button
you can click while you're listening to the show right
on the iHeart app.
Speaker 3 (30:46):
Simply record your question and it will come straight to us.
All right, Brian, Joe and Mount Lookout says, our tax
refund was nearly twenty thousand dollars this year. That feels wrong,
so we'd be adjusting something with our CPA or our paycheck.
Speaker 4 (31:03):
Yes, next question, Well that's a what for Joe? Yeah,
that's and again, this stuff happens, right. This isn't because
people are incompetent or anything like that. It's just sometimes
you just don't know what direction things are coming from. So, Joe,
I'm gonna guess that twenty twenty four, which is the
tax here we'd be talking about here twenty twenty four?
For you, there probably were some unique situations that happened.
(31:23):
Perhaps you maybe sold a business, or maybe you inherited
an IRA took distributions out of it. And it sounds
like so I'm gonna guess it sounds like you knew
there was a big tax situation happening, and so you
did your withholding properly or you did quarterly estimated payments,
which is good, but you maybe did a little too
much good. So yeah, twenty thousand dollars is a fat
(31:43):
is a pretty fat refund refunds. Of course, for those
who maybe aren't thinking about it this way, refunds are
not a something to celebrate. There's something to fix, as
Joe is sensing here, because that just simply means you
gave the irs way too much money. This didn't matter
so much, you know, over the past, prior you know,
maybe three years ago and well beyond that, when interest
rates were nothing and you couldn't get a lot of
money for just sitting on your cash. But now that
(32:06):
twenty thousand dollars that probably could have earned you eight
hundred nine hundred bucks just sitting in a bank account
spitting out money market account, spitting out three or four percent.
So definitely something you want to fix. I would look
to understand what the situation was that was unique in
twenty twenty four and if that's going to repeat again,
well then yeah you should worry about your withholding. But
if that was some one time things, then you might
be okay. But definitely you use the keyword talk to
(32:27):
your CPA and figure out what that situation is, so
let's go. We'll move on to Rob in Mount Washington.
Rob says he's sixty seven and he's got a fifty
eight year old spouse. They feel confident about their nest egg,
but they're worried about that age gap. So they want
to think. They want to know how should they be
thinking about income and portfolio allocations given the fact that
there's a there's a nine year difference in their ages. Well, Rob,
(32:47):
a couple quick things come to mind.
Speaker 3 (32:49):
One that may impact which Social Security claiming strategy you take,
meaning you know it may make some sense after you
run the numbers to delay taking your Social Security until
a because remember.
Speaker 4 (33:01):
Your spouse's spousal.
Speaker 3 (33:03):
Benefit after you're gone is going to be impacted by
when you take your benefit. So that's one thing to
keep in mind. And that kind of leads to the
overall point I want to make here is longevity planning. Uh,
you know, you're nine years older than your spouse. Women
tend to live longer than men, as we all know,
so you got to make sure that portfolio is positioned
(33:24):
for the really long haul here, because your spouse is probably.
Speaker 4 (33:27):
Going to live into her early or mid.
Speaker 3 (33:30):
Nineties if there's not some you know, health issues that
I obviously don't know about. So longevity planning is a
key that that may you know, impact how your portfolio
is allocated. And then that gets into income planning, which
we talk about all the time. If you if you've
got that long term mindset and you can evaluate where
all your income sources are going to come from, that's
(33:52):
where you could take the most tax efficient approach to
your income streams during retirement. So if you think a
few various things to think about there, all right, Dave
and blue Ash says, I set up a charitable remainder
trust last year, how do I start using it effectively?
Speaker 4 (34:08):
And what should I be watching out for? Brian? Okay,
so this is a great important question from Dave, and
I certainly hope that there was some discussion about these
very topics before you sign on the dotted line for
that trust, because charitable trusts are can be good for
lots of reasons, but there's also some pitfalls. As with anything,
there's no there's no black and white everybody should do
this solution to anything anymore. So, uh, let's define some terms.
(34:30):
Charitable remainder trust is something where it's a way where
you can donate a fixed amount of money but still
benefit from it. So ultimately, what you do is you
set up a trust and then you put this This
is for sizable amounts. We're not talking five ten thousand dollars.
We're talking hundreds of thousands. Usually that's not a minimum,
but there's a there's a certain amount that makes it,
you know, worthwhile versus not. And the whole point of
(34:52):
it is you put you put some money away, you
get a deduction on it because you have permanently given
the money away. You will never see the principle again.
You gave it away irrevocably. That's an important word. You'll
never see this pile of dollars again. However, that pile
of dollars is allowed to be invested and you can
generate income off of it and benefit from that. So
the word remainder simply means I'm going to put this
(35:14):
money in and I'm going to live off the interest,
and the remainder when I die goes to whatever charity
I have designated in the trust. But again, the big
thing there is this is irrevocable. You'll never see those
dollars again. It has to pay you at least five
percent to that income beneficiary. It can't pay any more
than fifty percent. That one always confused me. I can't
imagure that anything that pays fifty percent and is still
(35:34):
legit you get all your money back anyway. There are
tax limitations, so the deduction is limited to the present
value of that remainder interest. In other words, it doesn't
matter what it grows to over the twenty years that
you live. What matters is what you put in in
the first place. So many moving parts of charitable remainder trust.
These are also known as cracks and cruts, and I'm
not going to get into that for the legal walks,
but if you run across those terms, all of those
(35:56):
are different versions of charitable remainder trust that you might
run across thinking about your state planning. So good on Dave,
for obviously he's thought about his estate planning and made
some decisions. Just make sure you understand the moving parts
that come along with that.
Speaker 3 (36:08):
All right, Coming up next, We've got Brian's ever popular
bottom line segment. You're listening to Simply Money, presented by
all Worth Financial on fifty five KRC, the talk station.
Speaker 4 (36:19):
News. When it happens breaking news tonight. We are coming
to you live news when you need it.
Speaker 5 (36:25):
You're going to want to listen to this news.
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When you least expected.
Speaker 5 (36:29):
We've never quite seen anything like this.
Speaker 1 (36:31):
Cheaping you up today on what's happening.
Speaker 4 (36:33):
This is going to be quite the event tonight, and
you're going to want to make sure you leave the house.
Speaker 1 (36:36):
Extra early, locally, nationally, everywhere in between.
Speaker 5 (36:40):
I don't know what I would do without it.
Speaker 1 (36:42):
Fifty five KRC the talk station, Men, summertime is here.
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Hey that next month I have to choose between groceries
for my kids or gas for my car.
Speaker 1 (36:53):
Talk about it here. Fifty five KRC the talk station.
Speaker 4 (37:00):
Get this movie.
Speaker 3 (37:01):
You're listening to Simply Money, presented by all Worth Financial
on Bob Sponsorller along with Brian James. And it's time
for Brian's bottom line. He's going to give us some
good stuff tonight about longevity planning.
Speaker 4 (37:13):
Bob. We've been talking about inflation and the price of
eggs and all that stuff for what seems like years.
That's actually only been about maybe three or four years,
but whatever, it feels like decades. I want to talk
about a different type of inflation today. And that's longevity inflation,
or otherwise known as outliving your money. So we'll all
worry about inflation at the grocery store, of the gas
pump and all that kind of stuff. But the CDC
reported that the US life expectancy has bounced back to
(37:36):
seventy nine years and that's the highest we've seen since
before COVID, And one in four sixty five year olds
is going to live past ninety That's that's you know,
that's that's the situation that we're in now. And for
anybody who's a little doubtful of this, you know, with
this all the time happens where we'll tell people, hey,
we're going to run your financial plan out to age
ninety five, because you've got plenty of money to die young.
That's not the problem. The concern is outliving it. And
(37:57):
they'll say, oh, then this is when you get the
list of people. All right, Bob, my uncle Bob died here,
and my mom died here. I'm not going to live
past eighty two and a half. That's what I'm going
to die. And I say, well, that sounds fun. Mark
that date on your calendar and we'll pinpoint it. But no,
that leaves a lot of a risk on the table.
So you know, I always encourage people go go to
any nursing home at lunchtime and go ask any of
those folks if they thought they were still going to
be around at this point. But funny here, no, go ahead,
(38:20):
go ahead. Sorry. So yeah, So here's the here's the concern.
But social Security was created back in nineteen thirty five,
life expectancy was only sixty one and most people didn't
even live long enough for the benefits to turn on.
And now, of course, not only we living longer, but
just just the cost of being retired, the cost of
not being retired as soaring. So you know, the Fidelity
(38:41):
now estimates a sixty five year old couple is going
to need three hundred and fifty one thousand dollars just
for health care and retirement. And that's not long term care.
That's just going to the doctor and taking your pills
and all those kinds of things for thirty years.
Speaker 3 (38:52):
Bob, Yeah, And I apologize for interrupting, but it just
brought up something that I unfortunately am dealing with.
Speaker 4 (38:59):
A lot right now with my clients.
Speaker 3 (39:01):
Folks that have been with me for thirty years and
I love them dearly, but they're aging. And you know,
I'm not an actuary, I'm not a doctor. I'm just
giving you some anecdotal information. You know what I'm seeing here, Brian,
to your point, you know the folks that want to
plan on passing away at seventy eight, seventy nine.
Speaker 4 (39:20):
Or eighty two.
Speaker 3 (39:21):
What I'm seeing with regularity now is the age that
this memory decline stuff and dementia and things are happening
where we have to involve kids and other family members
to help take care of people.
Speaker 4 (39:37):
It seems to.
Speaker 3 (39:38):
Rear its head in that eighty five to eighty nine
year window. I mean a lot of people are living
that long, and you've got a plan for that, and
not only to not run out of money, but have some.
Speaker 4 (39:51):
Long term care plans.
Speaker 3 (39:54):
Not just money, but plans built into your overall you know,
strategy here.
Speaker 4 (40:00):
Because it's real, it's happening. I'm seeing it every day. Yeah,
And I think what occurred to me. I don't remember
this thirty years ago when I started. I don't remember
talking to clients who were intensely worried about about dementia
and those kinds of things. I think our bodies have
now gotten to the point where we can keep them
functioning a lot longer than we can keep our brains functioning.
So we've now moved into a place where you know,
(40:21):
the engine runs fine, but that computer that runs the
whole thing isn't quite working so well. But yeah, there's
an enormous amount of concern for the kinds of things
that happened here. So again, just something to think about.
Don't worry so much about the cost of eggs, worry
worry more about what your plans are for that super
long term of life.
Speaker 3 (40:39):
Yeah, there's a financial component and a family communication component.
Get out in front of it when you can. All right,
thanks for listening. You've been listening to simply money? Is
that about all worth? Financial?
Speaker 4 (40:48):
On fifty five kr see the talk station Mark Levin.
Speaker 7 (40:53):
Probably the people who should be listening aren't, but there
are a lot of people who tune in by accident.
Speaker 4 (40:58):
Let me start listening. I get this wherever I go listen.
I listened for a week. I listened to two he said.
I like this guy. I like what he has to say.
Speaker 1 (41:05):
Mark Levin Tonight at ten o six on fifty five
KRZ the talkstation. Hey, if you're sending your child off
to college,
This free off is a the American people are authentic
voices fifty five kars he the talk station.
Speaker 2 (00:15):
Tonight, more turbulence regarding the relationship between our president and
the Federal Reserve and Cincinnati's largest public company announces a
thousand job cuts.
Speaker 3 (00:27):
You're listening to Simply Money, presented by Allworth Financial. I'm
Bob Sponseller along with Brian James.
Speaker 4 (00:32):
Well.
Speaker 3 (00:33):
Brian, for the first time in modern history, a city
US president has fired, or at least tried to fire
a Federal Reserve governor.
Speaker 4 (00:41):
Update us on what's going on here, Well, big headlines here.
This is some some unprecedented actions here to follow the
unprecedented actions we've kind of seen all year long, as
we've got somebody with a little bit of a new approach.
So so President Trump declared he had terminated Federal Reserve
Governor Lisa Cook. He's using her of this is a
quote having a long tracord of housing, a track record
(01:03):
of housing market manipulation and unethical mortgage dealings. That's a
quote direct for the president. Uh. Not not a lot
of evidence yet that's coming, of course, That's something now
that we're living in the age of social media and headlines.
We start with the accusations first, we don't back them
up with evidence. That's where we are right now. That's
coming should be fairly easy to determine whether this is
a thing that actually happened or not. She's accused of
(01:25):
having misstated the whether which residence was her primary residence. Obviously,
for your primary residence, you get the best interest rate
you can possibly get. If it's a secondary residence that's
considered an investment property, and then you don't you get
to pay a little more for that because it's more
of a business transaction. That is the accusation U. And
so we'll have to wait to see what more comes
(01:46):
of this, to see if there's if there's truth to it.
If there is, then well, yeah, that's probably not a
good look for a federal or to serve governor somebody
at that level should be probably be thinking a little
bit differently. But that's where we are today. Yeah, it's
not a good look.
Speaker 3 (01:59):
It's it's all so, and you know, you run the
course of you run the risk of upsetting anybody anytime
you give an opinion. But I really wish the president,
you know, we still live in a country where you
are you are innocent until proven guilty?
Speaker 4 (02:14):
And uh, I think the facts are out.
Speaker 3 (02:17):
You know, you got to let the facts come out
on this stuff before you go fire somebody or even
fire off tweets on social media. If FED Governor Cook,
you know, violated federal mortgage law, she probably deserves to,
you know, need to step down from her spot. But
I what what upsets people, you know, in general and
(02:37):
in the financial markets and all that is when we
get this volatile you know, immediate texting and social media
post especially by the President of the United States, that's
unsettling for a lot of people. And you know, personally,
I wish he.
Speaker 4 (02:51):
Wouldn't do that. So it calls into question the independence
of the.
Speaker 3 (02:56):
FED, which we've talked about and and will continue to
talk about here a little bit this morning.
Speaker 4 (03:02):
Yeah, and I think it's at least a Cook is
not really the issue here. I think the issue is
really what you just said, is if if she's convicted
or whatever or confirmed to have done these things, then yes,
she should lose her job and we should all move
on and then add her to the list of people
that maybe weren't quite on the up and up on
both sides of the aisle in a powerful position politically.
(03:22):
That that, to me is the small story. The bigger
story is it was the concern that the president is
looking for specific individuals who did certain things because he
wants to be able to create a spot to move
somebody in, you know, with good batter or right, wrong
or and different. That's what the discussion is, and that's
where the end of the discussion of independence comes. If
somebody wants to show, you know, a list of all
(03:44):
the every FED governor and here's what they may or
may not have done, and then we clean it up
that way, great, I'm fine with that. We're shining a
bright light into every corner. I'd like to see that
at every corner or every level of government clean up.
The mess is targeting, and we just want to get
rid of this person, and we're going to ignore what
the other stuff is done. Then that bring the question
of the independence of the FED into question, a sort
(04:04):
of a witch hunt of sorts to create a spot
to put in with somebody who will agree with you.
That's the concern. Whether it's valid or not, that's gonna
that's for the public to decide. But I think that's
really what the discussion is here.
Speaker 3 (04:15):
Yeah, in the delicate balance that we try to got,
you know, we try to walk here with the Federal
Reserve is they are supposed to be and largely are
an independent body. The governors are appointed by the presidents.
They serve what is it, fourteen year terms, but they're
not really accountable to anybody on a daily basis. So
(04:37):
you know, they sit there and they're independent, and we
hope they all follow the rules. We hope they all
work in the best interests of the country. But I
think we're all naive if we think that presidents and
their cabinet appointees don't meet with these Fed governors and
try to influence Federal Reserve policy. I think the difference
(04:58):
with this president. I mean, you go back fifty seventy years.
Every single president in history has had multiple meetings with
Federal Reserve chairman.
Speaker 4 (05:07):
That's nothing new.
Speaker 3 (05:08):
I think what's new with this president is we go
out on social media or in press conferences and we
just you know, pokem and produm and criticize them. That
is a new thing that again I wish would not happen,
and I think that can be unsettling for people.
Speaker 4 (05:25):
Yeah, it really can, and there is a little bit
of precedent for this. So this we went through this
not that long ago with Trump versus Wilcox. Here, So
when will Cox Kathy Harris were similar officials on two
different government boards, National Labor Relations and the Merit Systems
Protection Board. I don't know what that second one is,
to be quite honest, but anyway, earlier this year, President
(05:45):
Trump removed them despite specific statutes that prevents any president
from that protects those folks from being fired without cause.
Willcox should have been in her finishing her term until
twenty twenty eight, for example. So they both of those
people sue and they argue that their removal violated that
long standing statutory constitutional protection. And so that's where we
(06:06):
are now. The Supreme Court in May granted an emergency
stay of that lower court ruling, and so that one
is still being fought out. This is another one where
the there's where it's fairly black and white that the
president does not have the power to do this, but
whether that's actually going to be enforced is in question.
And again, lots of questions here, and I think the
smallest one of these is whether Lisa Wied on her
mortgage application. There are much bigger questions here. There are
(06:29):
plenty of able bodied people who can serve in the
role of board governor. We don't lose a ton if
one gets swapped out. That is not the question you're
listening to.
Speaker 3 (06:37):
Simply money present of by all Worth Financial on Bob's
funtseller along with Brian James all Right.
Speaker 4 (06:42):
Switching gears here.
Speaker 3 (06:43):
The other story that we're following Kroger, and we've known
about some of these job cuts announcements going back months
and months, but Kroger finally announced that it is cutting
one thousand corporate jobs in a major reorganization, and we
now know that that includes two hundred corporate jobs right
here in Cincinnati.
Speaker 4 (07:02):
Brian, Yeah, so this just happened the other day. So
fewer than one thousand corporate employees they are going to
be losing their jobs. But this does not include This
is mostly administrative headquarters type roles, store manufacturing, distribution staff
unaffected here. But Interim CEO Ron Sergeant said, this is
basically a strategic move to shift resources toward efforts that
(07:24):
better serve customers. And some of this is in reaction
to that failed merger with Albertson's that was shot down
for anti trust reasons not long ago, so they took
some financial hits from that, and so what they're trying
to do is get their profit margins back to where
they were, and these are some steps that they're taking
to go in that direction. So they had plans to
close they are already in June. They already had plans
(07:45):
to close about sixty underperforming stores over a year and
a half. That's about five percent of their twelve hundred locations,
and that's supposed to have about one hundred million dollar
charge financially speaking. So despite all of that, Kroger still
expects they're looking for a modest gain out of all this,
and they're looking to move those savings from these moves
into enhancing the customer experience and including you know, job
(08:08):
offers to employees from closing stores, trying to find work
for them somewhere that they actually need them. So there
is some efforts being made there as well. It's not
all about sick.
Speaker 3 (08:17):
Yeah, anytime you do a merger, I mean, let's face it,
Brian companies try to merge because they think there's some
efficiencies to be found there which improve profit margins. I mean,
that's part of merging and running a business. It's not
good for the people that are impacted, but it's just
part of how business works. And let's hope and pray
that those two hundred individuals in Cincinnati are able to
(08:38):
be you know, relocated within the company to another role
or laying on their feet in some way, which I'm
sure they will.
Speaker 4 (08:45):
You know, Kroger had.
Speaker 3 (08:46):
About fifty eight hundred employees in Greater Cincinnati as of
a year ago, four hundred and fourteen thousand employees in
total for the whole company. So again, when it impacts you,
it's a big deal. But two hundred employees, you know,
it's a percentage of the total, not a huge number.
Speaker 4 (09:06):
Yeah, and this is not the first time, even this
year that the Kroger has made this decision. So a
little earlier this year, the eighty four to fifty one company,
the Artist formerly known as dun Humby, laid off several
different positions just just in the idea of again cost cutting.
And they didn't really say exactly how many positions there
were at the time, but I know that just from
the phone calls that we received here from people who
(09:28):
are impacted by it. I know that was it was
probably a bigger number than what we might might anticipate. Now,
if you find yourself in this situation, Kroger or not, well,
this is where we come back and we talk about
guess what financial planning? Well, okay, this is a no
fun situation. How are we going to deal with it? Well,
hopefully you've got an emergency fund in place. Right. If
we lose a job, there's usually some kind of severance
(09:49):
package involved. Sometimes there's not. So that's why we need
to make sure and let's make sure that we know
what we're spending in the first place. Right, that's where
it all starts. Lay off or not understand which your
situation is, so that you can understand the packed of
some situation like this. Therefore, if I know what I'm
spending on a monthly basis, how much is three months,
six months, nine months of my expenses? Maybe twelve months
if you want to be super conservative, and then make
(10:10):
sure that dollar amount is accessible somewhere. That buys you
time to avoid running up credit card debts or tapping
into your longer term retirement savings, which is usually going
to come with taxes and penalties. Yeah.
Speaker 3 (10:21):
And the big thing that hits people, you know, out
of thin air, that they don't often think about and
they should is healthcare. You know, if you're someone impacted
by this layoff, look at the potential cobra coverage healthcare coverage. Again,
we have no idea about what severance packages are being
put out there, but make sure you're taking a good
hard look at how your healthcare is going to be
(10:42):
impacted and make sure you're covered there.
Speaker 4 (10:45):
Coming up next, you.
Speaker 3 (10:46):
Think you're diversified, We're going to break down why what
looks like a well balanced portfolio might actually be anything
but that you're listening to simply money. Presented by all
Worth Financial on fifty five KRC the talk station make.
Speaker 4 (11:00):
Us the number one preset on your car radio and
on the free Knew It Improved iHeartRadio app Free Never
sounded so good.
Speaker 5 (11:07):
Fifty five krc D Talk Station. Allworth 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 (11:29):
You're listening to Simply Money, presented by all Worth Financial
on Bob Sponseller along with Brian James. If you can't
listen to Simply Money live every night, subscribe to get
our daily podcasts. You can listen the following morning during
your commute to work or on your way to the
gym or at the gym. And if you think your
friends could use some financial advice, tell them.
Speaker 4 (11:48):
About us as well.
Speaker 3 (11:49):
Just search Simply Money on the iHeart app or wherever
you find your podcast. Well, Brian, yesterday we spent a
lot of time discussing the importance of diversific and as
we just said, if you missed it, we encourage you
to download yesterday's podcast. And if you're listening right now
thinking you are diversified, let's take a few more minutes
(12:11):
and make sure that's the case.
Speaker 4 (12:13):
Yeah, So let's talk about why the Sometimes we can
think we're diversified, but we're not. So the illusion of diversification.
So conventional wisdom says diversification is about spreading the risk.
If I own a bunch of different things, then I
then then know one of them can sink my ships.
And that pretty much is true from a very high level.
But what can look like diversification actually oftentimes is not.
(12:34):
You might have a whole bunch of different accounts, investment accounts,
or you might have a whole bunch of different investment
in ticker symbols on that quarterly statement. But that's not
really the point. If you can't just simply assume that
because you have a bunch of different things, that that's
really going to have the diversification effect that you need.
What matters is how those investments behave as a team,
individually and together under all these different market conditions. So
(12:57):
one of the biggest things that you need to look
for more of us own mutual funds or exchange traded
funds ETFs, UH and UH. The assumption can be, if
I have a bunch of these different ones, then I'm
properly diversified. However, your largest of large ETFs mutual funds
all are going to own Apple, Microsoft, Amazon and Video
and so forth. So while you may have a dozen
different funds in there, a lot of them are giving
you the exact same exposure. So I think back way
(13:19):
back to Bob, this will, this will, let's go, let's
take a wayback machine. As a financial advisor, I don't
know if you remember something called the Janice Big four
funds from the late nineties and early early two thousands.
Oh yeah, yep. Jannis Fund, Jannis twenty Fund, Mercury Fund,
and Worldwide Fund. These funds were just going gangbusters and
everybody decided, you know, it's all they need. There were
articles you were you were getting.
Speaker 3 (13:38):
We were getting twenty five, twenty seven, twenty eight percent
a year out of those suckers for a good four
to five six year run.
Speaker 4 (13:44):
It was great. Look at this, I've got a diversified
portfolio averaging me twenty five percent. What can go wrong
with this scenario? Well, here's what went wrong. The dot
com crash dragged them all underwater. Those the Big four
were heavily and concentrated in tech and telecom names. The
bubble burst from peak to trough, those four funds lost
sixty to eighty percent of their value, and that was
just devastating to people who had piled in at the top. Now,
(14:07):
if you were properly diversified, two thousand and one two
thousand and two were no fund But at the same time,
you can survive those types of things. But if you
truly did only look at last year's performance of these
various funds and invest that way, and lots of people
still do this. Unfortunately, then you did get hammered and
it hurt. Yeah, if you fast.
Speaker 3 (14:25):
Forward to today, I mean one company in particular that
happens to be reporting earnings after the bell, Navidia. It
now makes up eight and a half percent of the
cap weighted sm P five hundreds. So you look at
a lot of these big cap funds. You know, so
many of these mag seven big tech cap you know,
(14:46):
big tech companies make up such a big cap weighting
of the SMP that any hiccups at all among these
magnificent seven stocks are going to cause more volatility in
that S and P five hundred. So people think, well, hey,
I'm in the S and P five hundred, I'm diversified.
And to your point, Brian, if you look at the
holdings of these large cap growth funds, you might be
(15:08):
surprised that the holdings in them are almost, you know,
very close to identical.
Speaker 4 (15:13):
Because let's face it, the.
Speaker 3 (15:14):
Mutual fund industry, the managed money industry, they all talk
about beating the index.
Speaker 4 (15:19):
Well what is the index. It's the S and P
five hundred.
Speaker 3 (15:22):
None of them want to stick their neck out too
far and go away from that index because the minute
they quote unquote underperform, people fire them. So it's just
a herd mentality. And this cap weighting, you know, with
so much concentration in so few stocks, can leave you
with a portfolio that is way more volatile than you
(15:44):
might have bargained for. So what do we do about that, Brian,
in terms of building a nice, balanced, well diversified, truly
diversified portfolio.
Speaker 4 (15:53):
Yeah, so I want to start off by making sure
we understand what the problem is. So you used a
couple of words in there that I want that might
be new to some people. Half weighting, What does that mean? Well,
we talk about the S and P five hundred and
a lot of people are aware that's the five hundred
largest companies in the United States, good, bad, and different.
But the assumption can be that, well, that must be
my investment is divided evenly across those five hundred names
(16:14):
inside that mutual funder exchange traded fund. And that is
not the case. And that's the point Bob was making
as we're sitting here right now. The magnificent seven that's Apple, Microsoft,
and VideA, Amazon, Alphabet Meta, which is Facebook, and Tesla.
Those are about a third thirty four percent of the
S and P five hundred. If you invested in that
index fund, that's not a bad investment, but just know
that a fully a third of it is just those
(16:35):
seven companies. That's what CAF weighting means. The bigger the
company is, the more of a percentage of that index
that makes up there.
Speaker 3 (16:42):
And there are like S and P equal weight funds
out there and ETFs that you can invest in, so
there's a lot of different things you can do. What
we're trying the point we're trying to drive home here
is when we really look at risk management and how
assets work together, you have to look at how things correlate,
you know, bonds, stocks, emerging markets, international, small cap, mid cap,
(17:06):
large cap.
Speaker 4 (17:07):
That's really what.
Speaker 3 (17:08):
You want to build in terms of having a portfolio
that gives you the highest rate of return per unit
of risk. If risk is something you're even concerned about.
Speaker 4 (17:18):
Yeah, I want I want to share some of So
I think this is an interesting topic and I'm dragging
you down a little bit of a rabbit hole here,
but this whole cap weighted versus equal weighted discussion here.
So I just did a quick comparison since January of
two thousand and three, the equal weighted right, dividing it
evenly over five hundred holdings, that has outperformed only twelve
out of twenty one years. The cap weighted side, which
(17:40):
is what we normally, that's what you see at the
bottom of your TV screen every that's the version of
the S and P five hundred. That one, of course
has had the edge nine out of those years. So,
but the difference can be significant in the actual outperformance
because when we're in good years, when technology is going
great guns, then absolutely the cap weighted version will perform
better because seven of those stocks make up a third
(18:01):
of the S and P five hundred. But when those
stocks kind of hit the skids, like happened earlier this
year and a few years ago as well, when they
were all making tens of thousands of layoffs, then the
equal weighted version will be better. So are we saying
you should choose one or the other. No, The point
is you should understand what you own and how it
actually works, because what this means the technology can take
a massive hit technology sector and it'll drag the S
(18:21):
and P five hundred down the cap weighted version of it.
But that means maybe finance and insurance and defensive type
companies might be doing okay, you have to make sure
those are represented in your portfolio.
Speaker 3 (18:31):
You're listening to Simply Money presented by all Worth Financial
on Bob Sponseller along with Brian James.
Speaker 4 (18:36):
Hey, Brian.
Speaker 3 (18:36):
Something that comes up sometimes in the office when I
meet with prospective clients is this whole idea of advisor diversification.
Some people think if they've got two, three, four different
quote unquote advisors, that they're getting the best of all
worlds because they're getting all this different advice and they
can get all these ideas. You know, how does that
(18:58):
work in your world in real practice. I've got my
opinion on and I'm interested in yours.
Speaker 4 (19:04):
Sure, yeah, and my my thinking on that. What I
always tell people is if you if you're going to
have more than one advisor, first of all, it's your money.
You do the thing that puts you to sleep at night.
If you can sleep better having more people looking at it,
that's fine. However, that puts you ultimately in the position
of being an advisor. You're the CEO and you have
you know, now you have four vice presidents of you know,
four chief financial officers underneath you, all of whom are
(19:26):
going to give you their varying different opinions. And as
long as you've hired good, competent people, they're going to
be good opinions. But at the same time, you're going
to have to decide I'm going to listen to this one,
that one or the other one. And what I've found
is that most people wind up frustrated and just confused
because they're getting information from a bunch of different sources.
And what they do is they shut down and they
don't act on anything because they've got too much information
(19:47):
coming at them. So advisors are advisors are paid for
a reason. You need to trust them or not pay them.
If you're not going to act on the advice you're given,
you're being given and that includes if you're simply overwhelmed
with all the detail, then you need to question whether
that's the right approach for you. So I think it
creates more confusion than anything else. I could not put
that any better. Here's the all Worth advice.
Speaker 3 (20:09):
Real diversification isn't just owning a little bit of everything.
It's being smart about where your money's going, why it's there,
and what it's supposed to.
Speaker 4 (20:18):
Do for you.
Speaker 3 (20:18):
Make sure every dollar has a job, whether it's for growth,
income or leaving a legacy. You're listening to Simply Money,
presented by all Worth Financial on fifty five KRC the
talk station.
Speaker 4 (20:30):
What's Happening d one year in jail.
Speaker 1 (20:36):
Bread University to turn himself into his day's news.
Speaker 4 (20:40):
Is now Illinois a disaster?
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Five KRC the talk station.
Speaker 4 (20:45):
You're listening to Lee Filter, an iHeartRadio station.
Speaker 3 (20:54):
You're listening to Simply Money, presented by all Worth Financial
on Bob's sponseller along with Brian James. Joined tonight by
our technology and cybersecurity guru, mister Dave Hatter.
Speaker 4 (21:04):
Dave, it's always great to have you with us tonight.
Speaker 3 (21:08):
You want to talk about elder scams and this is
something that seems to be growing and growing in regularity,
and it's something we all need to be aware of
and make plans to prevent.
Speaker 6 (21:19):
Yeah, guys, sadly this appreciate you having me on. It's
always I think this is an important topic because you
know I have elderly parents. I know many of your
listeners do, and this is a growing concern. So just
one stat and this is a great site for folks,
by the way, just for general stats and information. The
Internet Crime Complaints Center IC three, which is run by
(21:40):
the FBI. They put out a fraud report every year
that's got all kinds of stats in it. And again
the site is just useful in a lot of ways.
I encourage people to bookmarkt IC three dot gov. Elderfrond
losses hit four point eight eight billion and twenty twenty four,
a staggering forty three percent jump from the previous year.
The average senior victim lost over eighty three thousand dollars.
(22:02):
And then another good site for some insight into this
is the Federal Trade Commission FTC FTC dot gov. So
here's a headline from a public service announcement they put out,
business and government impersonators go after older adults life savings.
Speaker 4 (22:16):
And then they have.
Speaker 6 (22:17):
Some stats in there too, and they say, in fact,
reported losses of over one hundred thousand dollars increase nearly
sevenfold from twenty twenty to twenty twenty four. So you know,
I hate to always be the doomsday guy, the guy
with the tenth fol hat, always warning about this stuff.
But you know, I don't want to see people lose
their entire life savings. And is we spend more time
(22:38):
online and every facet of our lives working, education, you know, school,
you name it, think about it. What are you not
doing online nowadays? It just creates that many more attack
vectors for the bad guys. You're throwing things like artificial
intelligence and the ability to generate, to clone someone's voice,
to generate incredibly realistic videos, incredibly realistic texts, to kind
(22:59):
of eliminate all the old school tells like well, I
got an email asking me to do something weird, and
I need to send gift cards to the hamlet, and
county sheriffs can to arrest me, but the grammars all
weird and so forth, All that's gone. The bad guys
have access to low cost or free tools that make
it really easy for them to run these sort of
scams at scale. And again, you don't have to take
(23:20):
my word for it. You can see what the FBI
is saying, You see what the FTC is saying. And
at one last point, and then I'll let you guys
start asking some specific questions. Is you know this again?
The documentation is all out there. The scams are increasing.
They're targeting elderly people in some cases, but you know,
we're all subject to all kinds of scams, and this
(23:40):
kind of education is important, as is a healthy dose
of skepticism and vigilance. You know, the Hamlet and County
sheriff is not going to call you and tell you
that because of a parking ticket, they're coming at three
to arrest you if you don't buy gift cards or
send an INMO payment, right, they don't operate that way.
Speaker 4 (23:57):
Hey, hey, Dave. So yeah, and then those those they
are all great examples. But you're right, this isn't new
news anymore. And I think the one, the one that
is new is the to me is the deep fake stuff.
I don't think we've even scratched the surface on that.
I have yet to hear a story, you know, about
somebody losing an awful lot of money yet to that,
but that is coming and it's gonna be huge. So
these articles you said is extremely helpful here, but they
(24:19):
reference an awful lot about cyber insurance. So I don't
want to drag you off course here, but is this
something that we should be considering. I mean, maybe we
all have home insurance, we have fire insurance, we got
flood insurance in some case. Is it we at a
point where we should all consider cyber insurance? Do you think? Uh?
Speaker 6 (24:33):
I think it's worth it as a business, absolutely, But
I also find that many small businesses that I talk
to about this stuff because on my real job, I'm
not talking about this all the time and trying to
help business.
Speaker 4 (24:45):
Come on, David, this is your real job.
Speaker 6 (24:47):
Yeah, you know, people will say, well, I've got cyber insurance.
I don't like to care about this, and I just
like to remind folks, well, your fire insurance does not
keep your building from burning down, you know, ideally it
helps you recover should that happen. So you can't just
say well, I got insurance, I'm good to go.
Speaker 7 (25:03):
Right.
Speaker 6 (25:03):
You need a strategy where you're trying to harden your environment,
defend yourself against these kind of attacks. Be smart, be vigilant,
move slow, and then you know, be resilient. Part of
that resilience, you know, in addition to backups and so forth,
might be insurance. You know, as an individual, does it
make sense to get some kind of personal cyber insurance? Maybe,
(25:24):
especially if you have a lot of risk if you're
a high net worth person.
Speaker 4 (25:28):
But I think there's a lot of things you can do. Guys.
Speaker 6 (25:30):
Again, the first step is always knowledge, right. I mean,
you can't defend against something you don't know about. Knowledge, skepticism.
It's doing the simple things we talk about all the time, strong,
unique passwords, multifacture authentication. It's also doing things like freezing
your credit. I'm sure you guys would agree. You know,
my card is frozen. Yeah, and until I need to
(25:51):
get credit, I keep it frozen. I unlock it when
I need it, and I lock it back. You know,
it's not foolproof, but you know you're raising the bar
making yourself a much more difficult target for the bad
guys because in most of these cases, especially you know,
these targeting of elders, they're not specifically targeting individuals. They're
going for low hanging fruit. And if you take the
(26:13):
kind of advice we're given out here, if you harden yourself,
if you do these basic practices, you're going to be
a much more difficult target. They're just going to move on.
And again, the skepticism, you know, I encourage any of
your listeners pick up the phone and try to call
Microsoft or Google and get help. And my point is
they are not looking at your computer and going, hey,
(26:33):
I think you've got a virus. I'm going to call
you up today and tell you let me help you
remove this virus. If you get a call, an unsolicited
call from a company that claims you have some kind
of virus and they want to help you, the likelihood
that that is not a scam is probably greater than
all three of us getting hit by a media right now,
it is a scam, right, So again, vigilance, knowledge, skepticism, and.
Speaker 4 (26:58):
You know, when you look at the numbers.
Speaker 6 (27:00):
One of these reports say there's eighty five trillion dollars
in wealth out there in the Baby Boom and Silent generation.
The bad guys know this, right, They know there's an
enormous amount of money. They know in a lot of cases,
older people may not even be aware that it's possible
to create a very you know, a perfect deep fake
audio or video. And you know, you guys mentioned there
(27:20):
is documented evidence already more in a corporate setting of
large scale fraud that's been perpetrated using deep fake voice
cloning and videos.
Speaker 4 (27:29):
I encourage your folks go look up the.
Speaker 6 (27:31):
Story about the Ferrari CFO who got a nearly got
deep fake voice cloned into fraud from the so called
Ferrari CEO. And these are people that know each other personally.
Speaker 4 (27:42):
This is the real gave us a segment maybe for
next week. I'm in right that one. Now. It's why
I wouldn't to look into it, well documented.
Speaker 3 (27:50):
Dave, I was going to ask about the whole phone
thing and voice cloning.
Speaker 4 (27:55):
Yeah, so I'll just ask it this way.
Speaker 3 (27:57):
I mean, are we now at a point where it's
just because I know what I do. I never answer
my phone ever, ever, ever, unless I know who's calling me,
I just don't answer my phone. Are we at the
point now where our advice to folks, especially elderly and
maybe vulnerable folks, just give that blanket advice, do not
(28:18):
answer your phone unless you know who it is.
Speaker 4 (28:21):
Are we at that point? Is that the best way
to protect folks?
Speaker 6 (28:25):
I think so I can tell you I do not
ever answer my phone from a number I don't recognize,
and I'm even sometimes skeptical if it is an number
I do recognize. Because keep in mind, guys, spoofing, which
in my mind is the biggest driver of all this
creating something that looks realistic but isn't. It's fairly easy
to do in any digital mechanism. It's really easy to
send a phone call from any number you want if
(28:47):
you know what you're doing, and it does not require
a lot of skills. So you know, if I could
find one of your two cell phone numbers, or if
I happen to have it, I could easily spoof a
call that would look like it came from your cell phone.
I could easily send a text that looks like it
comes from you. You know, same thing with emails. So skepticism, vigilance,
don't answer the phone if it's important. They'll leave a message,
or they'll contact you some other way. Go read what
(29:10):
the government says. You know, IRS, FBI. They are not
going to call you and tell you some terrible thing
is going to happen to you if you don't make
it in when a payment by five PM. They don't
operate that way, and they state that clearly on their
own websites. So again, there's tons of useful information out
there that can help people avoid these kind of scams.
Speaker 4 (29:29):
FTC dot gov, IC three dot gov.
Speaker 6 (29:32):
But it all starts with skepticism and caution like don't
answer your phone. If you don't recognize the number, they'll
leave a message, and if they don't, must not be important.
Speaker 4 (29:41):
All right, good stuff as always, Dave.
Speaker 3 (29:43):
You're listening to Simply Money, presented by all Worth Financial
on fifty five KRC, the Talk station, Mark Levin.
Speaker 7 (29:51):
You know, America, we spend an awful lot of time
in this country responding to an unreality created by the
people who hate America to buy people who get sucked
into the narratives that are pushed out there each and
every day. And they're posting, and they're posting, and they're posting,
and they'll move on to the next thing, and the
next thing and the next thing. That's what the media
enemy do.
Speaker 1 (30:11):
Mark Levin Tonight at ten oh six on fifty five KRS,
the talk station Finding Great Candidates.
Speaker 4 (30:19):
The hirings are welcome to here. Why do we keep
letting thousands of people come over and do nothing about it?
My family's safety.
Speaker 3 (30:25):
Is at risk.
Speaker 1 (30:26):
Fifty five KRC, the talk station. You're listening to Simply
Money and presented by all Worth Financial. I'm Bob sponsorller
along with Brian James. Do you have a financial question
you'd like for us to answer. There's a red button
you can click while you're listening to the show right
on the iHeart app.
Speaker 3 (30:46):
Simply record your question and it will come straight to us.
All right, Brian, Joe and Mount Lookout says, our tax
refund was nearly twenty thousand dollars this year. That feels wrong,
so we'd be adjusting something with our CPA or our paycheck.
Speaker 4 (31:03):
Yes, next question, Well that's a what for Joe? Yeah,
that's and again, this stuff happens, right. This isn't because
people are incompetent or anything like that. It's just sometimes
you just don't know what direction things are coming from. So, Joe,
I'm gonna guess that twenty twenty four, which is the
tax here we'd be talking about here twenty twenty four?
For you, there probably were some unique situations that happened.
(31:23):
Perhaps you maybe sold a business, or maybe you inherited
an IRA took distributions out of it. And it sounds
like so I'm gonna guess it sounds like you knew
there was a big tax situation happening, and so you
did your withholding properly or you did quarterly estimated payments,
which is good, but you maybe did a little too
much good. So yeah, twenty thousand dollars is a fat
(31:43):
is a pretty fat refund refunds. Of course, for those
who maybe aren't thinking about it this way, refunds are
not a something to celebrate. There's something to fix, as
Joe is sensing here, because that just simply means you
gave the irs way too much money. This didn't matter
so much, you know, over the past, prior you know,
maybe three years ago and well beyond that, when interest
rates were nothing and you couldn't get a lot of
money for just sitting on your cash. But now that
(32:06):
twenty thousand dollars that probably could have earned you eight
hundred nine hundred bucks just sitting in a bank account
spitting out money market account, spitting out three or four percent.
So definitely something you want to fix. I would look
to understand what the situation was that was unique in
twenty twenty four and if that's going to repeat again,
well then yeah you should worry about your withholding. But
if that was some one time things, then you might
be okay. But definitely you use the keyword talk to
(32:27):
your CPA and figure out what that situation is, so
let's go. We'll move on to Rob in Mount Washington.
Rob says he's sixty seven and he's got a fifty
eight year old spouse. They feel confident about their nest egg,
but they're worried about that age gap. So they want
to think. They want to know how should they be
thinking about income and portfolio allocations given the fact that
there's a there's a nine year difference in their ages. Well, Rob,
(32:47):
a couple quick things come to mind.
Speaker 3 (32:49):
One that may impact which Social Security claiming strategy you take,
meaning you know it may make some sense after you
run the numbers to delay taking your Social Security until
a because remember.
Speaker 4 (33:01):
Your spouse's spousal.
Speaker 3 (33:03):
Benefit after you're gone is going to be impacted by
when you take your benefit. So that's one thing to
keep in mind. And that kind of leads to the
overall point I want to make here is longevity planning. Uh,
you know, you're nine years older than your spouse. Women
tend to live longer than men, as we all know,
so you got to make sure that portfolio is positioned
(33:24):
for the really long haul here, because your spouse is probably.
Speaker 4 (33:27):
Going to live into her early or mid.
Speaker 3 (33:30):
Nineties if there's not some you know, health issues that
I obviously don't know about. So longevity planning is a
key that that may you know, impact how your portfolio
is allocated. And then that gets into income planning, which
we talk about all the time. If you if you've
got that long term mindset and you can evaluate where
all your income sources are going to come from, that's
(33:52):
where you could take the most tax efficient approach to
your income streams during retirement. So if you think a
few various things to think about there, all right, Dave
and blue Ash says, I set up a charitable remainder
trust last year, how do I start using it effectively?
Speaker 4 (34:08):
And what should I be watching out for? Brian? Okay,
so this is a great important question from Dave, and
I certainly hope that there was some discussion about these
very topics before you sign on the dotted line for
that trust, because charitable trusts are can be good for
lots of reasons, but there's also some pitfalls. As with anything,
there's no there's no black and white everybody should do
this solution to anything anymore. So, uh, let's define some terms.
(34:30):
Charitable remainder trust is something where it's a way where
you can donate a fixed amount of money but still
benefit from it. So ultimately, what you do is you
set up a trust and then you put this This
is for sizable amounts. We're not talking five ten thousand dollars.
We're talking hundreds of thousands. Usually that's not a minimum,
but there's a there's a certain amount that makes it,
you know, worthwhile versus not. And the whole point of
(34:52):
it is you put you put some money away, you
get a deduction on it because you have permanently given
the money away. You will never see the principle again.
You gave it away irrevocably. That's an important word. You'll
never see this pile of dollars again. However, that pile
of dollars is allowed to be invested and you can
generate income off of it and benefit from that. So
the word remainder simply means I'm going to put this
(35:14):
money in and I'm going to live off the interest,
and the remainder when I die goes to whatever charity
I have designated in the trust. But again, the big
thing there is this is irrevocable. You'll never see those
dollars again. It has to pay you at least five
percent to that income beneficiary. It can't pay any more
than fifty percent. That one always confused me. I can't
imagure that anything that pays fifty percent and is still
(35:34):
legit you get all your money back anyway. There are
tax limitations, so the deduction is limited to the present
value of that remainder interest. In other words, it doesn't
matter what it grows to over the twenty years that
you live. What matters is what you put in in
the first place. So many moving parts of charitable remainder trust.
These are also known as cracks and cruts, and I'm
not going to get into that for the legal walks,
but if you run across those terms, all of those
(35:56):
are different versions of charitable remainder trust that you might
run across thinking about your state planning. So good on Dave,
for obviously he's thought about his estate planning and made
some decisions. Just make sure you understand the moving parts
that come along with that.
Speaker 3 (36:08):
All right, Coming up next, We've got Brian's ever popular
bottom line segment. You're listening to Simply Money, presented by
all Worth Financial on fifty five KRC, the talk station.
Speaker 4 (36:19):
News. When it happens breaking news tonight. We are coming
to you live news when you need it.
Speaker 5 (36:25):
You're going to want to listen to this news.
Speaker 4 (36:27):
When you least expected.
Speaker 5 (36:29):
We've never quite seen anything like this.
Speaker 1 (36:31):
Cheaping you up today on what's happening.
Speaker 4 (36:33):
This is going to be quite the event tonight, and
you're going to want to make sure you leave the house.
Speaker 1 (36:36):
Extra early, locally, nationally, everywhere in between.
Speaker 5 (36:40):
I don't know what I would do without it.
Speaker 1 (36:42):
Fifty five KRC the talk station, Men, summertime is here.
Speaker 2 (36:49):
Hey that next month I have to choose between groceries
for my kids or gas for my car.
Speaker 1 (36:53):
Talk about it here. Fifty five KRC the talk station.
Speaker 4 (37:00):
Get this movie.
Speaker 3 (37:01):
You're listening to Simply Money, presented by all Worth Financial
on Bob Sponsorller along with Brian James. And it's time
for Brian's bottom line. He's going to give us some
good stuff tonight about longevity planning.
Speaker 4 (37:13):
Bob. We've been talking about inflation and the price of
eggs and all that stuff for what seems like years.
That's actually only been about maybe three or four years,
but whatever, it feels like decades. I want to talk
about a different type of inflation today. And that's longevity inflation,
or otherwise known as outliving your money. So we'll all
worry about inflation at the grocery store, of the gas
pump and all that kind of stuff. But the CDC
reported that the US life expectancy has bounced back to
(37:36):
seventy nine years and that's the highest we've seen since
before COVID, And one in four sixty five year olds
is going to live past ninety That's that's you know,
that's that's the situation that we're in now. And for
anybody who's a little doubtful of this, you know, with
this all the time happens where we'll tell people, hey,
we're going to run your financial plan out to age
ninety five, because you've got plenty of money to die young.
That's not the problem. The concern is outliving it. And
(37:57):
they'll say, oh, then this is when you get the
list of people. All right, Bob, my uncle Bob died here,
and my mom died here. I'm not going to live
past eighty two and a half. That's what I'm going
to die. And I say, well, that sounds fun. Mark
that date on your calendar and we'll pinpoint it. But no,
that leaves a lot of a risk on the table.
So you know, I always encourage people go go to
any nursing home at lunchtime and go ask any of
those folks if they thought they were still going to
be around at this point. But funny here, no, go ahead,
(38:20):
go ahead. Sorry. So yeah, So here's the here's the concern.
But social Security was created back in nineteen thirty five,
life expectancy was only sixty one and most people didn't
even live long enough for the benefits to turn on.
And now, of course, not only we living longer, but
just just the cost of being retired, the cost of
not being retired as soaring. So you know, the Fidelity
(38:41):
now estimates a sixty five year old couple is going
to need three hundred and fifty one thousand dollars just
for health care and retirement. And that's not long term care.
That's just going to the doctor and taking your pills
and all those kinds of things for thirty years.
Speaker 3 (38:52):
Bob, Yeah, And I apologize for interrupting, but it just
brought up something that I unfortunately am dealing with.
Speaker 4 (38:59):
A lot right now with my clients.
Speaker 3 (39:01):
Folks that have been with me for thirty years and
I love them dearly, but they're aging. And you know,
I'm not an actuary, I'm not a doctor. I'm just
giving you some anecdotal information. You know what I'm seeing here, Brian,
to your point, you know the folks that want to
plan on passing away at seventy eight, seventy nine.
Speaker 4 (39:20):
Or eighty two.
Speaker 3 (39:21):
What I'm seeing with regularity now is the age that
this memory decline stuff and dementia and things are happening
where we have to involve kids and other family members
to help take care of people.
Speaker 4 (39:37):
It seems to.
Speaker 3 (39:38):
Rear its head in that eighty five to eighty nine
year window. I mean a lot of people are living
that long, and you've got a plan for that, and
not only to not run out of money, but have some.
Speaker 4 (39:51):
Long term care plans.
Speaker 3 (39:54):
Not just money, but plans built into your overall you know,
strategy here.
Speaker 4 (40:00):
Because it's real, it's happening. I'm seeing it every day. Yeah,
And I think what occurred to me. I don't remember
this thirty years ago when I started. I don't remember
talking to clients who were intensely worried about about dementia
and those kinds of things. I think our bodies have
now gotten to the point where we can keep them
functioning a lot longer than we can keep our brains functioning.
So we've now moved into a place where you know,
(40:21):
the engine runs fine, but that computer that runs the
whole thing isn't quite working so well. But yeah, there's
an enormous amount of concern for the kinds of things
that happened here. So again, just something to think about.
Don't worry so much about the cost of eggs, worry
worry more about what your plans are for that super
long term of life.
Speaker 3 (40:39):
Yeah, there's a financial component and a family communication component.
Get out in front of it when you can. All right,
thanks for listening. You've been listening to simply money? Is
that about all worth? Financial?
Speaker 4 (40:48):
On fifty five kr see the talk station Mark Levin.
Speaker 7 (40:53):
Probably the people who should be listening aren't, but there
are a lot of people who tune in by accident.
Speaker 4 (40:58):
Let me start listening. I get this wherever I go listen.
I listened for a week. I listened to two he said.
I like this guy. I like what he has to say.
Speaker 1 (41:05):
Mark Levin Tonight at ten o six on fifty five
KRZ the talkstation. Hey, if you're sending your child off
to college,
Simply Money News
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