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December 31, 2023 • 44 mins
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(00:01):
In your corner, saving one investorat a time, working for clients,
not companies, all while bullyproofing portfolios, totally committed to sharing academic truth is
about the missing, always representing MainStreet and not Wall Street. Team,
It's your Son Money team and thisis the Sound Money Investment Show with Drown

(00:22):
Financial Advisors. Hello and welcome tothe Sound Many Investment Show with Brown Financial
Advisors. I'm Greg Brown and I'mJames Worth and we are a registrit investment
advisory firm. We are independent.We do work for clients and not companies.
To receive your complimentary and personalized financialincome plaian give us a call at

(00:42):
five one three, five seven,five nine sixty five four if you're seeking
advice on old four one K fourto three B some type of employer sponsor
plan, even an INUA analysis.And here's the point. Before you do
that, fateful rollover to the IRAthe INUA analysis. If you're no longer
with the company than as rule,your money should not be there either,

(01:03):
so we can help you roll thatout into a tax through IRA. Take
control of your money innu way.Otherwise, give us a call five one
three, five seven, five ninesixty five four. Our website Brownfinancial Advisors
dot com. Email team at BrownfinancialAdvisors dot Com. Our home offices in
Milford, but we'll also have locationsin Blue Ash, Woricsester and Florence,
greg. You know when you mentionedthe NUA, it's a choice you can

(01:26):
make on doing a rollover properly fromthe corporate healthstot in the four one K
figuring out the right amount to putinto after tax account versus remain in the
text deferred account. There's there's kindof a mathematical science to that to get
it right. You know, ifyou don't do it right to the IRA,
then you're going to give unnecessary moneyto the irs. So some things

(01:49):
to keep in mind. And themore money you keep on your side of
the balance sheet over time, deferredgrowing at some average rate of return over
time when you look back at theend of your days, the end of
retire, back to the retirement eventitself, the kind of additional capital resources
and bucket of money that exist fora significant other when you leave it behind,
or beneficiaries and errors, it canbe significant. So getting it right,

(02:15):
you know, you get one realgood shot at retiring. Rarely do
you get redoos and as you enterretirement it's very likely something you haven't done
before. Well, we see it. We see it all the time.
Now it's true. Is your activeadvisors here and key team at Prow Financial
Advisors, the Sound Money team,we have seen about I would say,

(02:38):
anywhere from five hundred to nine hundredinteractions with households, clients prospects per year.
So it's like we get to liftthe roof off of these homes of
all these people from a financial perspective, see what works, what doesn't,
and so we have a great dealof experience, even though we haven't entered
retirement ourselves, we've seen over thepast fifteen to twenty years, gosh,

(03:01):
you know ten fifteen thousand households,and you know that doesn't mean all of
those are our clients. We advisea lot of people at different levels.
We're a holistic firm. Issue you'veheard, taxes, insurance, investments,
financial planning, income planning. Wehelp a lot of people at many different
levels. So the magnitude that impactand the magnitude of what we've been able

(03:22):
to see what people intend to do, what they're doing, what they shouldn't
do, what works and what doesn'twork. It's significant, and we ask
you to consider leveraging this experience sothat you make the best of your retirement
decisions as you enter retirement and getit right, get it right the first
time, the only time right.And today you know our subject isn't too

(03:46):
far away from this conceptually. Todayit's retirement costs that you should not underestimate.
You underestimate the expense side. You'llbe surprised at how much additional income
you have create from your investments,more so than you anticipated, which could
what drive down the value of thoselong term buckets of money on an accelerated
basis, causing them to maybe notlast as long as you do, in

(04:10):
effect outliving your money. You don'twant to do that. So understanding the
three primary ways that people may underestimatethe cost of living in your retirement,
let's kind of jump in. Haveyou not underestimated the cost of something before?
Right, You've been there, We'veall been there. Let's use college
tuition as an example, because weall know how expensive college has become.

(04:33):
It's led people to wonder, youknow, is it worth it? Should
they go? They see very prominentcelebrity type people that bypass the college and
educational phase their life and jump rightinto what they believe is productive life,
you know, a career path ofsome kind. It's still I would say,
we wouldn't recommend that. Still tryto get all the education on your
side you can. They always saythat that's the one thing that no one

(04:57):
can ever take away from you,So we encourage that to still be true
for you. Now. Well,one issue you might want to debate is
what type of degree is young andgoing for. So when you have the
children's going off to college getting whatseems like a degree in under water basket
weaving or something productive like that,you know that's maybe the point. But

(05:18):
still getting a productive, usually businessrelated degree is the point about the importance
of a good college degree. Itcertainly is even today. Probably the many
decades that a business degree is afoundational basis of knowledge that can be so

(05:39):
applied in many directions is so truestill today. And then larry on top
of that's some special interest or directionor whatever the whatever the analysts are saying
the best direction for college equaling careerequaling pay and the ability to pay off
some of this sticker shock tuition thatyou may encounter where you're trying to put

(05:59):
or help other people go through schools, particularly certain schools. And we've all
seen children, maybe grandchildren, havinga desire to go a certain school,
maybe an in state prominent school hasthe big college sports program, it has
just you know, it's it's almamater of the other family members, or
wanting to go just across the borderand become an out of state student and

(06:23):
get clabbered with, you know,not having in state tuition. A lot
of factors here. As you approachretirement, though, it needs to become
more about your story and your incomeand the reliability, predictability and efficiency of
that income, and to turn thecorner on being that wallet and purse for
the entire family tree. You know, you do it through accumulation phase.

(06:45):
You're the go to vacations, specialneeds, first cars, just always there.
You know, private tuition to privateschools in the all through elementary,
junior high school, whatever your situationis, You've always been that go to
in all likelihood, but turning thatcorner to where you can offer love,
place to sleep and some food whenyour children kind of hit a crossroads of

(07:06):
difficulty and stopping shy of just tryingto fix all the problems financially. That's
one of the most critical things.I think you fight the fire against spending
more than you thought you would inretirement. That's not one of our real
talking points in our information when weshare today, But that's just from the
heart. There's one from experience foryou. If you're out there experiencing that

(07:27):
you got to get some help,you got to get some help. That's
a black hole that could really wipeyour retirement ambitions off the map. And
in terms of cost for just thecollege concept, here the College Board reports,
and this is a board that hasanimal statistics on college expenses through surveys.
It reports that moderate college budgets foran end state public college average nearly

(07:50):
twenty seven thousand dollars a year.And that's the tuition. Now imagine for
some of the answery costs that goalong with that moderate budget out of private
college is about fifty two thousand,nearly double. So even something as simple
as a really good restaurant you've probablyseen and noticed the prices are shocking you

(08:11):
as well. They've gone up severaltimes since inflation started kind of peeking its
head out and it's normal. Imean, when there's inflation, costs go
up, bag size stay the sameon chips, but the number of chips
decrease in all these things and we'veexperienced that. But think about being on
the other side of the coin,when something tends to be less expensive than

(08:33):
what you anticipated. That's a greatfeeling, right. So we're often likely
to purchase something if we find outit costs less than we thought. But
think about some of the costs thatfactor into actually retirement. Now, Unfortunately,
many people estimate the cost across theboard and it can lead to not
only financial stress, but I wouldsay emotional stress too. So today we

(08:56):
want to help you better understand preparefor those important retirement cost so that you
can be prepared to enjoy the goldenyears. So let's get into the thought
provoking questions that tie into today's show. So, for starters, what are
the costs that are most often overlooked, underestimated, or not properly accounted for?
And starts with one of the biggestones, which is our spending habits,

(09:20):
are spending patterns, and typically whenwe start getting into retirement, instead
of our spending patterns going down,usually in the first two to five years
of retirement, they go up,maybe not substantially yet, but still comparatively
speaking, when you're still working,they still increase. Now they tend to
level out and go down after awhile, but still that initial wave of

(09:41):
spending is something that you need toproperly account for in your income plan,
in your retirement plan. That's againif you even have a plan. Another
big one is inflation. And Iknow, up until this, you know,
the last couple of years what theFED called inflation. As far as
a transitory thing, I guess transitorymeans it's just simply not permanent, right,
but it still means that you needto factor that into your overall plan.

(10:03):
Is if inflation averages around the historicalnorm, which is around three percent
or so. And again different measurementsof inflation, depending upon which CPI measurement
you're looking at, inflation could bea little bit more, maybe a little
bit less, and it doesn't justsimply you know, prices going up is
not completely uniform across all different sectorsof the economy. So if you look

(10:24):
at gas prices, you look atmedical expenses. But that's another one.
Categorically, as far as in retirementis the cost of medical or healthcare expenses,
and it could be anywhere from yourinsurance premiums, whether it be the
Medicare premiums. Some people are subjectto IRMA, which is the income related
Medicare penalty. That's if your income, according to our government is a little

(10:46):
bit too high, or your taxfiling status. You're trying to play tricks
and games with the tax attorney.Think aha, I'm going to file separately
and I'm going to avoid some ofthese taxes. Then you get that nasty
little surprise with the Medicare premiums,maybe doubling or trip ping, and suddenly
you're five hundred dollars savings on taxesis dwarfed by that six thousand dollars expense
that you just incurred with your Medicare. So little things like that that added

(11:09):
to big things. And we're goingto get back on track of this after
the commercial break about the retirement costs, that you should not underestimate our fund
about the office five one, three, five, seven, five, nine
to sixty five more call as wecan help, but stay tenure listening to
the Sound Money Investment Show with BrownFinancial Advisors here on fifty five cars Detox
Station. Opinions expressed are solely thoseof Brown Financial Advisors and should not be

(11:35):
interpreted as specific advice. Materials presentedare believed to be from reliable sources and
no representations can be made as toits accuracy. All ideas and information should
be discussed in detail with one ofour qualified investment advisors prior to implementation.
Market based investments involve risk, andpast performance is no guarantee of future results.
Insurance based investments offer guarantees based uponthe claims paying ability of the issuing

(11:58):
company. All insurance, tax andmortgage ses are offered through Brown Insurance and
Tax Advisors LLC. Brown Financial Advisorsand Brown Insurance and Tax Advisors are affiliated
companies and may only transact business inthose states in which registered or were otherwise
legally permitted. Welcome back to theSound Money Investment Show with Brown Financial Advisors.
I'm Greg Brown and I'm James Borthand we are an independent RIA that's

(12:20):
a registered investment advisory firm. Wedo our for clients, not companies.
That's Main Street and not Wall Street. Our fund number five one, three,
five, seven, five, nine, sixty five to four. Website.
Brownfinancial Advisors dot com. Email teamat Brownfinancial Advisors dot com. Our
home offices in Milford, but welshave locations in Blue Ash, Westchester,
and Florence. All Right, youknow, James, I just had this

(12:43):
ass of us this past week.People want to know if we still see
clients routinely, if we see newprospects, and just people in need looking
for help willing to be helped.Yes, on all three of those.
Absolutely, we have from the beginning. We've been here from the beginning and
we still do it today. Sowe're not just mister microphones from an ivory
tower that show up just to youknow, just to sprinkle some knowledge upon

(13:05):
you and then retreat to our habitat. We're in the trenches every day working
with you and for you, doingthings for you and enjoy doing that.
And we appreciate all of you thatare clients and those who listen to us
each week, whether you are ornot. And just want to make that
point because there's so many people outthere on radio media, you know,

(13:26):
other forms of media that seem tohave a lot to say about subjects like
this, but they haven't seen aclient and so on. They probably can't
even remember and that you deserve morethan that. I just felt compelled to
share that because you can underestimate thequality and the source of your advice too.
And so we're real, you're real. Let's really get together one of
these days and see what we cando. And now we're talking about retirement

(13:50):
cost that you should not underestimate andunderstanding these three primary ways in particular that
folks out there just underestimate their costof living in retirement. The best time
to do something about that and getthat recalibrating and in sync is now.
Never too late to do the rightthing, never too early either. And
James, you're going through some ofthe thought provoking questions that are related to

(14:13):
today's show. Yes, a bigcategory would be the medical expenses. So
in the category of long term care, that would mean do you have a
plan or does your plan account forat least a potentiality of one or both
of you going into a nursing homeor some type of home based care in
case you don't need the full gamutof skilled nursing facility level care, but

(14:37):
you still need some type of assistance. So a couple of options there is
having a home care approach or maybeassisted living approach as far as that's concerned.
But one of the questions that weget quite often is about long term
care insurance, whether that's the bestoption to cover the potential nursing home expenses
that you might incur later in life. And depending upon what age that you're

(14:58):
looking looking at, as far asdoing this analysis, the odds might be
as high as fifty percent that oneof you would be going into a nursing
home or maybe even looking at you, honey and me, it's like one
of us is going, sorry,honey, it's you, it's not me.
That's always the Usually, i'd saythat's almost always the case, is
you look across the table and say, well, it's not going to be

(15:20):
me, so it's got to beyou. But another approach, perhaps that
might be in some cases a betterapproach is more of a hybrid approach.
And what I mean by that isusing an asset based policy or type of
insurance plan that would have a writeror coverage for potential long term care expenses.
So here's how that works. Youtypically have either life insurance or an

(15:41):
annuity with the built in rider that'sgoing to cover a large degree of any
potential nursing home expenses, and whythat approach might be superior is because if
you don't go into a nursing home, then that means that your asset will
still get used with its intended purposeof how you were purchased it. So
with the long term care insurance policy, really those are kind of the user

(16:04):
or lose it now if you alreadyhave one, by all means, do
not cancel that without a thorough examinationof the benefits of your policy. But
if you're looking at whether you shouldbuy something like that versus a hybrid approach,
well, that's again part of theplanning process that we can help you
with. Greg any thoughts on that, Yes, that's that's a lot of
information you get your mind around iflong term care is a concern for you,

(16:26):
and it should be for many,because James just said it, basically,
it boils down to one and two. It's either me or you,
right, And what are the costs? If you look at in today's dollars,
a skilled nursing facility is going tocost upwards of eight thousand dollars a
month. Do the math. That'stwelve you know, twelve times eight is
ninety six thousand per year, andthat's just for a semi private room at

(16:48):
a nursing facility. Yeah, andwe want to have a plan before you
get the notification that one of you'sabout to change addresses right ahead of time,
whether it's religning buckets of money andinvestments and sequence of which buckets you
take liquidity from and cash flow fromto redirect towards the care needs of someone
keeping them at home as long aspossible, says the living is an option

(17:08):
home health care and option anything tokeep you out of the full blown long
term care facility. But what hereferenced where the types of policy exists that
most people aren't aware of. Andyes, we know for sure we're going
to die, So if we startthere with a life insurance policy, it's
going to pay tax free money toa lot of people we care about when
we're gone. Well, we knowthat's going to happen someday. So if

(17:29):
we have the policy, it issure to pay now the expense that you
have or the amount of money youpay in premium towards that. Here's where
he was suggesting that you can usehis policy certain policies in a new way,
and that would be let's say aboutupwards of sixty percent on average of
the death benefit can be advanced asa living benefit to pay the cost towards

(17:51):
the cost of long term care,and the residual forty percent would still go
on to be that death benefit taxfree money at the end of your journey.
So instead of paying a premium that'spretty high for you know, both
of you having LNG term care insuranceand then separately having a life insurance policy
with its premium on all these premiumsweighing down the burden of your expenses and

(18:15):
weighing down your cash flow in retirement, you can unify some of these things.
Now, broker's firms don't deal withthis. They don't even spend time
on this. They're just they kindof talk through yeah yeah, yeah,
financial information, a little bit ofa plan, and then they immediately make
a hard core press towards investing yourmoney because they're one trick ponies. It

(18:40):
acts, there's an action like there'smultiple legs on that pony. But when
it boils down to the real whathits the road, the rubber that hits
the road, it's just your moneygoing to some kind of investment. And
then if it's an insurance agent actinglike a financial advisor. They'll go through
the same blah blah blah stuff andthen boils down to how much money they
can stuff right into an annuity andmake a fact commission. You deserve better

(19:03):
on all the above. And that'swhy you know, something like long term
care that everyone's concerned about, butfew people do anything about or have a
plan for it if it happens,and will it happen? One and two
chance after age sixty five, Solook in the mirror or look at the
person next to you, just likeyou said. When we're doing seminars and

(19:23):
public speeches, it's kind of interesting. People be sitting at a table and
you bring up this subject and thenyou talk about the statistic of one and
two, and then you have thecouples at tables stare it cross at each
other and say it's them or us, or one of us and one of
them, and it just kind ofgets people thinking for a moment. Anyway,

(19:47):
James, I know there's many morequestions. Oh yeah, health insurance.
So if you're under the age ofsixty five, typically sixty five is
the bridge to medicare. And whenit comes to medicare, insurance, we
can help you with the approach ofwhich and it's a suitability issue first and
foremost when we say is it Medicareadvantage versus is Medicare supplement and the prescription

(20:07):
drug plans out there. So whenyou have the teeter totter of the decision
tree that says, do I wantto pay with cost certainty what the insurance
premium is and have virtually no outof pocket expenses or do I want to
maybe pay as you go When welook at the Medicare advantage model of health
insurance, either way, you shouldhave excellent health insurance coverage as long as

(20:30):
your providers are in the network foryour advantage plan. So that's really the
biggest consideration if you're looking at theadvantage plans is are all of your doctors
medical providers in the network and ifyou're looking at the little subtleties of and
in network versus out of network provider, all those different things. As far
as the decision trees, including theprescription drug plans, we can help you

(20:51):
with that, whether it's the openenrollment period coming up October the fifteenth,
or just during the other times ofthe year when you might be aging into
medicare or have newly found eligibility toa medicare plan. But if you're under
the age of sixty five, considerationsinclude COBRA marketplace plans. Typically for the
marketplace plans, those are especially importantif you might qualify for subsidies for paying

(21:12):
for your health insurance. Now,another category that is a major risk factor
would be about the market risk.So when we talk about at least whether
the actuality or the perception of riskfrom potential downturns in the market as we
have mostly seen this year so far, But does it also provide as far
as your approach your plan, away to at least potentially keep up with

(21:37):
the rate of inflation. So goingback to the risk or the perception of
risk, and maybe this is thepoint that we'll talk about later in the
show today, is that not allstocks or equities have the same degree or
measurement or amount of risk. Here'swhat that means. You might look at
domestic stocks versus international stocks. Internationalstocks might be also emerging market type categories

(21:59):
of stocks, large cap versus smallcap. All those different things play into
the overall risk factor. Some havemore, some have less. As far
as how your your investment plans areare allocated. So those are just some
of the factors that we're going totalk about today. We have more to
get to after the commercial break.Stay tuner. You're listening to the sound
Man Investment Show. Our fund numberfive one, three, five, seven,

(22:22):
five nine, six, five fourcallus we can help, but again,
stay tunure. Listening to the soundMan Investment Show with Brown Financial Advisors
here on fifty five KRC Detox station. Welcome back to the sound Many Investment
Show with Brown Financial Advisors. I'mGreg Brown and I'm James moore Than.

(22:45):
We are a REDSIRT investment advisory firm. We are independent. We do work
for clients and odd companies and itreally does all start with the plan.
That means actually having a plan,knowing what you own and why you own
it. So, whether you're seekingadvice on an old four one k b
irate rollover, investment planning, retirementplanning, income planning, tax planning,

(23:06):
social security maximization, a Roth conversionanalysis, in your way analysis, and
for some perhaps even in service rollover. All those and more we can help
five one, three, five,seven, five nine to sixty five four.
Our website Brownfinancial Advisors dot Com,Email team at Brownfinancial Advisors dot com
and our home office is in Milford, but Wessoll locations in Blue Ash,
Westchester and floren Shaw. All right, we're discussing today the retirement costs that

(23:32):
you should not underestimate. James wentthrough a lot of the questions involved kind
of tied to this subject, andyou know, including not to overlook building
a budget, calculating some of yourexpenses. We can help with that,
calculating a pre retirement which you mightthink you'll need, is income and cash
flow in retirement or if you're alreadyin retirement, it's sometimes a good exercise
just to budget where you are,how you're spending, where money's going,

(23:56):
is anything you can shave with that, Let's say, reducing your the quality
of your lifestyle is a worthy exercisebecause it just assures further that the money
that you have to live up onthe rest of your forever is going to
be fortified and you know, alittle more abundant. And then when Social
Security people ask the so security accountfor inflation, well, yes, no,

(24:17):
kind of sort of maybe you knowthere are intermittent increases tied to inflation,
but it seems like the greatest inflatedexpense that rides side saddle with that
is Medicare. There are large increaseson an inflation adjustment or an increase on
soci security in certain years, andthen lo and behold. Oftentimes it's pegged

(24:37):
almost exactly to the increase in Medicarepremium, or in some years it's a
little in excess, but then theywon't give as much the following year of
the year after and as an increase, but all the while each year annually
increasing Medicare nonetheless. So it's reallyone of those things that it feels more
like you're just taking money out ofone pocket put in the other, rather
than truly getting to benefit by anincrease to go buy other stuff with,

(24:59):
like you know, bread, eggsand milk. Now, it's just one
of these things that we see withpre retirees underestimating various costs really all the
time. So don't be discouraged ifyou do the same. It's just part
of the process of fine tuning.Now we have collectively multiple decades of working

(25:19):
towards this retirement event. That's theaccumulation phase, accumulating money so that you
can one day retire. Your mindsetwas to grow that money. But now
that you're getting closer to retirement,or maybe you're already in retirement, we
believe a mindset should shift and itneeds to take place more towards the accounting
for expenses, the fine tuning ofa budget, properly aligning your investment resources,

(25:44):
investment buckets with a job description anda purpose. So now you need
to start thinking about insulating to yourretirement portfolio. Which parts for growth,
which parts for emergencies, which partsfor liquidity? In general, what part
is for income? To resolve thegap and income you might have between sales,
security and your actual needs, thatis going to need to be backfilled

(26:04):
with an appropriate mix. We thinka balanced mix of investment solutions so you
can live a hope so retirement orI no SOO retirement. You need a
confident retirement and we can deliver thatin working with you. That's something you
can achieve and you should and youdeserve it. So start thinking about something
important. Costs to come along withretirement, make sure you're properly prepared for

(26:27):
them. Well, let's start withthe assumption about spinning habit. So the
assumption that we see quite often isthat people say that they'll spend less in
retirement then while they're still working.And in some ways that might be the
case. If you look at,well, I don't have to drive to
work on a day and end dayout basis, so perceptively I'm going to
be driving less. So that mightbe one category that we don't spend quite

(26:48):
as much money, Maybe don't eatout quite as much, or maybe we
out eat out even more. Soevery single day might seem like a Saturday,
which might make that spending habit seema little bit more like we're spending
more, not less. That couldbe a problem when you don't have that
wage based income coming in on aday in a doubt basis. So let's
do the math here. Let's justuse easy math as an example here that

(27:11):
if a married couple makes one hundredthousand a year combined, that means,
if you're going to use the roleof thumb, that you're only going to
need eighty percent of your previous retirementincome. So that one hundred thousand means
you only need eighty thousand coming into make ends. Meat. Well,
that's all fine and well if yourspending habits have also decreased by twenty percent.
So if your income decreases by twentypercent, you're spending decreases by twenty

(27:34):
percent, and you were already makingends meat as it was then everything so
far, so good right now.That also means, however, that most
people that's not how it works out. During your working years, you might
have gotten into a certain habit ora certain routine where you go to work,
come home, eat dinner, doa few other things, go to

(27:56):
bed rents, repeat, next dayis the same as the previous day.
But once again, in retirement,it might be where now you have time
for the different hobbies, some aremore expensive than others. Maybe it's traveling,
maybe it's playing golf. Maybe it'sgoing off and seeing the wild West
that you didn't get to see whileyou're still working, or going internationally and

(28:17):
seeing the sites that you didn't getto see. So again, where you
travel, how you travel could sometimesbe a little bit expensive, could be
a lot expensive. And that's thepoint is are you properly planning for that
as part of your overall retirement plan, your income plan. Greg The thought
that everyone's attempting to chase the meanwhatever I guess, whatever you anticipate retirement,

(28:41):
to be about, read about,think about, be careful because I
would say you're not average. Mostpeople are not average. That's why you
need a plan for you. Onaverage, no one has averaged exactly.
So it's good to get an averageamount of information from any source you can.
But then when you pivot to tryto apply it to you, remember

(29:03):
it's not necessarily for you. You'renot average. So come in so that
we can help you with a customizedplan. We'll take and account all the
current investments and buckets of money youmight have, annuities, life policies,
cash value them, are not longterm care, yes or no, your
actual needs, and then we'll alignyour money between green and yellow. You're
mostly invested out there on red money. It's I hope so many. We

(29:27):
want to get that to more cautionaryand make it more like probably so many.
It's still market risk, maybe tosome degree aligned with your risk,
and then move a good amount overto green money too. That's I know,
so money, that's the safer sourcesof money. Things that are fully
insured guaranteed can guarantee you lifetime income. Of course, all based on the

(29:47):
claims paying ability of an insurance company. But which part of your money you're
willing to lose, whatever part you'renot, Let's make sure we put it
in a place where you can't andthe amount that you're willing to risk according
to the right risk, aligned witha plan, and making sure we address
cash flow needs, retirement to muslimback cash flow and get your cash flow
plan, your income plan in motion. And there are a lot of really

(30:11):
neat, boutique like investments that wecan offer that Wall Street doesn't. That's
where you go to the land ofcookie cutter. Here you're going to get
a custom approach with boutique solutions notgenerally available to the public and oftentimes not
available with the exclusion, I guessthe exception of the high net worth folks.
We can bring a lot of reallycool high net worth typically strategies down

(30:34):
to say the twenty five thousand dollarsminimum level of investing. And if you're
out there and discourage, well,twenty five thousand I don't have that.
Well, if you're just getting started, well, let us help you along.
Let us be your tour guide tothe horizon of your future personal success.
That can start with one thousand dollarsand if your investor not on one
off, we will help you withyour plan over time. Get on a

(30:56):
path of contribution, not just stuckin a company plan, but your individual
plan. You should start and parallelyour plan with the company plan, like
the vour one K side by side, like two tracks or rails that make
up a track, and just getit rolling. Most likely, most likely

(31:17):
folks out there might be involved inwhat you might call the honeydew list,
going shopping, spending time doing thingsrepairs, updating the roof, updating hvac
or eating air, making sure thebasement isn't as leaky this year as it
was last year, all those typesof things. If you're doing while you're
still working and battening down a hatch, that's a good thing. If you

(31:38):
find that you're done with all thosethings and you can get a lot of
good years out of your home andwhere you live without large additional expenses,
that's a good step to have behindyou as you turn in your turn towards
your actual retirement, because expenses otherwise, they can just add up so quickly
and start digging into your retirement bucket, causing you a great deal of stress

(32:00):
because you're already going through a transitionof being constructively working for so many years
and about to spend as many yearsas you did in your work in time
in your retirement time frame, retirementphase. But you have to take all
the money you collected saved and thenturn it into something that somehow is just
going to last as long as youdo. When most of us, I'd

(32:20):
say, really all of us don'teven know how long that is. You
need help in this area. We'llask folks sometimes do any of you still
go to a pediatrician? Well,you don't, and there's a reason for
that. So you need to walkaway from Wall Street, which has been
your accumulation phase, partner the pediatricianand upgrade your retirement, your investment structure

(32:42):
to what you really need in thisphase, this distribution phase. We are
those experts investments, financial planning,estate planning, tax preparation, tax advisory,
insurance advice on all these things thatcan be the mortar between the bricks.
There's just a lot we can dofor you, and we'll help you
take advantage of that. Will fullyeask where you are, give you a
comprehensive plan and help you in allof these areas. With a full set

(33:06):
of recommendations complementary no obligation. Ourfund number at the office five one three,
five seven, five nine sixty fiveto four again five one three,
five seven, five nine sixty fivefour call us we can help. Now
after break, we're going to sharesome surprisingly good news about inflation and how
this is going to effect maybe nextyear's Social Security and Medicare rates, So

(33:27):
stay tuned for that. You're listeningto the sound Many Investment Show with Brown
Financial Advisors here on fifty five KRCDetok station. Welcome back to the Sound
Many Investment Show, Brown Financial Advisors. I'm Greg Brown and I'm James Boorthan.
We are an independent registered investment advisoryfirm. We do work for clients

(33:52):
and not companies. Our fund numberfive one three, five seven, five
nine sixty five four, website BrownfinancialAdvisors dot Com. Team at Browndfinancial Advisors
dot com and our home office isin Milford, but we lost some locations
in Blue Ash, Icester and Florence. Greg well, as we continue with
the retirement costs that you should notunderestimate, James, what's another thing people

(34:14):
underestimate. It's got to be inflation, and maybe it's when we look at
the historical numbers versus the recent numbersof inflation or what the government calls inflation.
Here's how that looks. Historically,what we've been looking at is around
a three percent and again historical averageof inflation. It was actually under three
percent up until this year. Nowit's right around three percent over the long

(34:37):
term. This year, however,what we're seeing is inflation is trending towards
nine percent, and that carries maybesome good news and bad news aul at
the same time. So your badeggs and milk costs about oh, i
don't know, nine percent more,maybe even more like twenty percent more,
it seems like. But when itcomes to Social Security and Medicare, this

(34:58):
is where there's some surprisingly good news. So for the recipients of Social Security,
there's what's known as the COLA,the cost of living adjustment, and
with inflation trending around nine percent onthe what's called the CPIU index, that
means that the Social Security recipients willalso see a nine percent increase via their

(35:19):
cost of living adjustments. Now here'sthe other part that's kind of i'd say
surprisingly good news, is that Medicarepremiums are actually set to decrease next year.
So those Medicare Part BE premiums,what's known as the standard Medicare Part
B premium is supposed to go fromone hundred and seventy dollars a month down
to one sixty four month. Sopercentage why it s, that's about a

(35:39):
three percent decrease is what we're lookingat for the Medicare Part B. Now,
again, put a little asterisk nextto that, or maybe a big
asterisk next to that, is thepeople who are subject to IRMA. You're
still going to wind up paying more, sometimes a whole lot more for really
the same type of insurance coverage,which is the standard what looks like the
standard Part B coverage. However,just because of your income reaches a certain

(36:04):
threshold, or maybe your tax filingstatus is a little bit different, and
you know, we can help youwith all this as far as analyzing whether
you're being penny wise and pound foolishor if you're actually saving money via how
your tax filing status goes. Butthat's the surprisingly good news is that Medicare
premiums, for the first time ina long time, are scheduled to decrease
next year. Yeah, I wasjust thinking, that's a twelve percent more

(36:30):
to be made up of government expendituresand Social Security and Medicare by tax collection
and for those who pay taxes.So and then watch out that thirty one
trillion dollar deficit may just continue togo up. So on the good news
for that one, if you ifyou listen to our administration to out the

(36:51):
so called good news about the depthsof spending, is that they're actually decreasing
the rate of the increase. Yeah, but nevertheless, there's still a deficit.
There's still the death that's continuing toincrease. But they are, however,
working on decreasing the rate of theincrease. If that's good news,
then that's good news. And somuch Washington works on legislation approved expenditures called

(37:15):
budgets. If they don't find away to spend money that they may not
need to be spending, then theylose the appropriation. So they spend it
anyway. It's just that's not today'ssubject. But it's always out there on
the burner, the back burner,and it burns. And while the deficits
increase, they do some funky maththat says inflation actually makes the real economic

(37:37):
impact of the deficit of thirty onetillion to be more like twenty six.
I don't my math, My calculatordoesn't do that, James. I just
don't get it. But something else, just put in perspective. If the
average inflation rate year years three percent, there's a Social Security estimate that says,
through the Limera, the Secure RetirementInstitute, that one hundred and seventeen

(38:00):
dollars of your Social Security over twentyyear period will just go to the being
consumed by inflation. So it isimportant that social Security has a cola based
trajectory of increases year over year.Even if it does go to Medicare,
that's a real expense in retirement thatyou have to solve for. So it's
going somewhere to kind of equalize.So, you know, it's good.
I just wish there was more ofa budgetary approach of Congress to make these

(38:23):
increases functional rather than so dysfunctional likeeverything else. Underestimating health care and long
term care. We kind of talkedabout that, and there are a lot
of research and data out there thatsays that the health care expenditures account for
almost twenty percent of the economy,and that's a lot, so a lot

(38:45):
of your expenses. You know,we've had numbers in the past and recent
shows where if you're sixty five arebetter. You might between now and the
rest of your life need about twohundred and sixty five thousand dollars in codepayste
deducts. What's whatever true too outof pocket health care expenses, and some
will think if they're healthier, James, we hear this often, I'm healthier,

(39:07):
I think my expenses and healthcare willbe less. Well contrarily, statistically
and actually the longer you live,even if you have lesser health care expenses,
year over year, you had moreyears you're back into about the same
number of someone you might say that'sless healthy. That just simply means when
you're doing your retirement plan. Ifyou think about the overall average lifespan of

(39:29):
people who've made it to age sixtyfive, on average, you're going to
live another twenty years. So theaverage life expectancy goes from seventy eight and
eighty four you know, men versuswomen, to more like eighty three to
eighty five, or even eighty fourto eighty six. So depending upon you
if you've already made it this far, across that proverbial lake and you keep
swimming. Now, your average lifeexpectancy is looking at eighty five with a

(39:52):
pretty high probability of making it intoyour nineties. And that takes a lot
of planning and budgeting for is tomaybe being able to fund your retirement.
Yeah, so true. If youhave a concept of funding anything, it
needs to be realistic too. Howmany times you arrived at a budget and

(40:13):
a wish list and things you wantto do and then you find you don't
have the resources. Well, somepeople don't stop there. They still pursue
the things they know they can't afford. And that's just that's a trap.
If you did that during your earlieryears in life and you figured it out,
there's a cost to that. Yougot too deep into credit cards,
debt, got behind with the irs, and you've turned the corner of about
a decade that followed and got itall smoothed out. Take that lesson of

(40:37):
life and build upon it. Don'tfall through the trap door of more expenses
than cash flow. And there aresome key takeaways in all this. First
thing you want to do jameson gettingorganized. Getting organized, that's part of
actually having a pun in the firstplace, but preparing expensive's retirement. How

(40:57):
about this, Are you thinking aboutthe life that you want to live in
retirement based on what you can affordor what you know? This is the
what you have for discretionary spending versusyour necessary spinning. You want to know,
i'd say, the details of whatyour spinning patterns are and understand how
they may change a little bit dependingupon the season or the reason. So
whether that's spending that goes up anddown depending upon whether it's summer versus winter.

(41:23):
How about vacations, holidays, Christmasspending. I know many people who
blow out their budgets at Christmas timeand it's like for what for why?
And you know, I know itfeels good, but man, did you
spend within your means or did yougo way beyond your means? Yeah,
they'll spend a quarter to half thefollowing year making up for the expense they

(41:44):
shot overshot in the year prior insuch a holiday. I think it really
helps if you break it down intothe categories of what's essential versus discretionary.
So that's your needs versus your wants. Greg Yep, what do you need
versus what do you want? Andof course, you need what you need,
so that's primary. The budget hasto go to that make you for

(42:05):
sure you solve for that. Soworst case scenario, have the base,
it's covered, discretionary. It justis what it is. Is the things
you don't necessarily need but you enjoydoing well. Don't starve your retirement by
not doing some of the things youlike to do. It's just a matter
of how much, what scale,what can you afford. Another takeaway is
stick to your income plan. Onceyou establish all this, just stick to
it. You need to be disciplinedin this financial phase because whether you have

(42:30):
a lot or less, you're ona fixed income. Some people have more
of a fixed income to solve forthese issues and others. But you need
to stick to it. It's scalable. It's a scalable truth. So once
you become organized and figure out youressential and discretionary expenses, then you just
want to refer to your income planretirement. Do you have a plan?
You know failing the plan is aplan to fail. So let's get together

(42:52):
and get a plan. We'll getyou the complete retirement picture, retirement plan,
comprehensive plan. Then break down themoney where it goes assign it a
We will then project and share allthe recommendations that we have. We won't
hold anything back. Can you decideif you see a good fit to work
together. Now it's just if you'refortunate to have a pension, then add

(43:12):
any form of soci security on that. For most households that have that going
on, to have a more narrowgap between what they need versus what they're
getting makes it a little easier.But so many people don't have that,
So how can we replicate that.We can create for you as self funded
pension, fully insured guaranteed income.There are solutions, and then the rest
of your money can be properly deployedin market investments because you won't have independency

(43:32):
on it for income, so youcan you can look at different ways to
risk that for a reward and alsomaybe eliminate or try to eliminate different biases.
So when we talk about social security, talk about pension. All those
are forms of annuities. So anannuity is an annuity, whether it's run
by the government or the corporation,such as a pension, and we can

(43:54):
help you to maximize those different typesof benefits and as far as the taxes
when you say, well, whichaccount is a tax impact of taking from
qualified versus non qualified accounts? SocialSecurity are their spousal benefit options? Are
their family benefit options? All thoseand more. There's so much we can
help with our fune number. Iwas just gonna say, keep it simple,

(44:14):
don't make it complicated or you won'tbe able to do it or stick
to it. Good point. Goodway to finish this up again our phone
number five one three, five seven, five nine sixty five four call us.
We can help now on behalf ofGreg myself James. We want to
thank you for listening today. Havea great we can remember this sound money
where good things are believable, achievableand true for you
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