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July 23, 2023 • 44 mins
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(00:01):
In your corner, saving one investorat a time. I'm working for clients,
is not companies, all while bullyproofingportfolios, totally committed to sharing academic
truths, abottom missing always representing MainStreet and not Wall Street. Team,
It's your Sun Money team and thisis the Sound Money Investment Show with Drawn

(00:22):
Financial Indors. Hello and welcome tothe Sound Money Investment Show at Brown Financial
Advisors. I'm Greg Brown and I'mJames Worth, and we are a registered
investment advice refirm. We are independent. We do work for clients and not
companies. To receive your complimentary andpersonalized financial and complainant, give us a
call at five one three five sevenfive four, whether you're seeking advisal on

(00:46):
old four one K four three B, some type of employer sponsored plan,
perhaps even in any way analysis here'sthe point about all this. If you're
no longer with the company, thanas a rule, your money shouldn't be
there either, So we can helpyou roll that out into a tax uitual
iray take control of your money.Give us a call five one three five
seven five. This is our website, Brown Financial Advisors dot com. Email

(01:11):
share your thoughts to team at BrownFinancial Advisors dot com. Our homeophicis in
Milford, but we also have locationsin blue Ash, Westchester and Florence,
greg Well. To get started today, this subject is pretty important, I
would say retirement and income planning.Someday the finish line will be retirement and
retirement is a new beginning. It'sreally the first, I guess period of

(01:33):
time in your life that you areconstructively unemployed. You're going to work nowhere,
You're going to work on pursuing thedreams and goals and ambitions to be
more the version of the idol you. But we find that's to the contrary.
People have never been busier. Infact, they oftentimes tried that don't
know how they ever had enough timeto work well. Those people that are

(01:55):
happiest are the ones that have aplan and that plan includes income because retirement
is cash flow. And what kindof plan should they have? What kind
of plan? Should you have acustom plan? And what does it mean
to have a custom plan? Anddo you have a plan? James tell
us, Does everyone have a plan? Oh no, it's like the failure

(02:15):
to plan is a plan to fail. There you have it, so you
might have one, just may notlike the outcome. So what does a
true financial plan look like? Well, most important components of a solid plan,
well, they would be something thatyou would be looking for because it'd
be about you, right, sobetter Yet, if you don't have a
plan, but you simply have investments, do you think that's enough? How

(02:37):
do you organize? And which bucketsof money do you use? First?
What you use for cash flow,what do you use for growth? What
do you use for emergencies? Whatdo you use for just chasing those toys
or those places and things? Itall matters, and it's best to have
a plan. Now we tend toWhat we tend to find most of the
time is people think that they havea plan, but when they break it

(02:58):
down and examine it, they furtheranalysis. They more or less have kind
of a report, kind of aone page picture of something. There's more
details, I guess. Even ifyou were to reverse engineer a paint by
numbers picture and you peel back thelayers, you do find the underpinnings beneath
the colors, the organization and sequenceby numbers that tie specifically two colors.

(03:21):
So that when you finally accomplish thisand you lay out the plan or the
image you have a rather beautiful picture. Very same here. It's otherwise.
If if you just stumble into theaverage let's say, investment place offering so
called financial services and advice, whatyou likely walk in and out of is
a cooker cutter situation where for youit's a hammer and for you, let

(03:45):
me see what happened to toolbox ahammer? Wait, wait, you're pretty
unique, you're special. Let's seehere another hammer. You might need a
screw driver assault. I mean,we oftentimes in public seminars just kind of
joke about have you ever tried toscrew a nail with a hammer or hammer
a screw right vice versa. Imean, you need to right tools.

(04:06):
You just need the right tools andwithout the right plan, and it shouldn't
be cookie cutter. So let's builda custom plan together. What we offer
is an opportunity for you to comein either call us five one three five
seven five nine six five four fiveseven five nine six five four or email
us team at Brown Financial Advisors dotcom or go online Brown Financial Advisors dot

(04:28):
Com as our website, and there'sa place there, a little form you
can say, hey, I'd liketo have one of those complimentary appointments and
other options. You could have dinneron us or dinner with us. If
you go to the seminar section atthe top of our menu of our website,
you can click there and you canyou can kind of go down a
decision tree. One is you don'twant to sit with a bunch of strangers
in a public seminar and eat astate dinner with your new best friend.

(04:53):
You could just opt to come infor the appointment here. We'll spend time
looking at everything you have. We'llhave you back with all the recommendation,
the plan, all the everything,without holding anything back. We want you
to have clear recommendations and guidance,all complimentary without any obligation. It will
still send you out you and yoursignificant other for a state dinner or the
other option has just come join usin one of our evenings of food,

(05:15):
Fund and Finance at one of thelocal restaurants, where we'll just speak about
all things retirement and challenge you andthen ask you to come in and do
something special for you, and thatwould be put together conference and plan.
We'll cover investments, insurance, estateplanning, income planning, cash flow,
pension selection and maximization, So securitymaximization, it's pretty important, and so
many of these things when it pullswrite down to it, you want to

(05:38):
get it right the first time.You know, retirement does not come with
duovers. And we've this is inour first rodeo. We've seen thousands of
homes households over the years and it'sbeen a really awesome benefit to see the
various dynamics and the outcomes, andwe know what works, what works really
well, what works less well,and what's going to be a collision course

(06:00):
for your personal financial failure. Soyou don't have to risk getting it wrong
the first time, because you onlyget the one time. So let's help
you. Let us help you bydiscontacting us James about provoking questions about custom
retirement and income planning. Oh absolutely, the thought provoking questions that tie into
today's show. So for starters,what exactly are your financial objectives? Are

(06:25):
they measurable? Are they written down? Are they just maybe ideas flooding around
in your head? And for theindividual versus the collective, you is the
spouse part of these conversations. Arethey involved in the decision making process in
planning for your retirement, your income, maybe even your legacy plan on the
end of your days. Right,What do you need your money to do

(06:46):
for you? Here's what that means. Do you have a specific job title
or description for your various different investmentaccounts. You might have one that's tailored
more for future growth, one that'stailored more for current income. Or you
could try to do two things atone time and get neither one done.
What are the main priorities for yourretirement, as in, what do you

(07:06):
feel like you either want to orneed to accomplish? You know? What
are your life goals is kind ofanother way of phrasing that, do you
have sufficient income or cash flow tosupport your lifestyle? Your lifestyle that you
have now the one that you wantto project into retirement and maybe perhaps not
just again the individual you, butalso the collective you. From Which accounts

(07:30):
will you draw income and in whatsequence? So if you need additional cash
flow in retirement, where's it goingto come from? What bucket of money
have you? As Greg mentioned earlierabout maximizing different types of sources of income,
whether it be from social security orpensions, or taking if you have
a pension option, taking the lumpsum versus the annuitized version of the pension.

(07:51):
To what degree are you at riskfor maybe running out of money at
least prior to running out of life. Are your investments properly aligned with your
personal risk tolerance? What is yourrisk tolerance? Is that the same answer
now as it was, say lastyear or five years ago. You know,
we hear this oftentimes when the market'spulling back suddenly, I want to
be conservative, and then when themarket's doing well, well, that's what

(08:16):
I want to be aggressive. Theproblem is, you wait until the market's
not doing well to then become conservative. You wait until the markets have done
well, and then you become aggressive. So timing the market does not really
work in that direction because you windup chasing the returns instead of capturing the
returns. Yeah, you know onthat you might get lucky if you walk
away with a win. You needto understand that probably statistically you just experience

(08:39):
an outcome driven by luck and notlikely a repeatable process. So therefore,
to catch that it's not a processat all, it's scientifically disproven to be
a process. And becoming more conservativedoes that mean necessarily replacing equities with bonds
in your portfolio or is there maybea more effective bond replacement strategy that you

(09:00):
should look at instead. Do youhave a plan to properly address inflation risk?
Yes, going back a couple ofyears, we heard that inflation was
transitory until it wasn't. Have youfactored in the potential for a healthcare and
I'll say the word emergency. Thiscould be something short term, it could
be something long term. Think thedifference is an acute short term issue versus

(09:22):
a chronic long term issue. Wenormally think of nursing home when it comes
to a chronic long term issue.Do you have a financial advisor to help
provide guidance with the planning process.So the last one is where this all
you know, the rubber meets theroad, if you will. The having
an actual financial advisor who was wellsuited for all these different areas of need,

(09:43):
whether it be for investments, retirementplanning, income planning, even tax
planning, and it all fits togetherand at the end is legacy planning.
But again, don't wait till it'stoo late to do your legacy planning.
Very true, a financial advisor who'smulti espinary like wealth coach, all of
the things like you've probably heard thismany times. We look at ourselves as

(10:05):
the Mayo Clinic of financial services becauseit's all inclusive, it's holistic, and
that matters. James, a plan, like you said, financial advisor here
being the last item here out ofsome some ud ten things that we've discussed
here and provoking questions. You couldturn this upside down. Everything lines up
with having good advice, you know, having a goal. Personally, I

(10:30):
think I've come at a crossroads inlife where and when we hear it with
clients too, they reach an endof some goals and they've reached many and
fail to set new ones that aremeaningful and keep on keeping on. And
if you think about stepping in retirement, most people have reached the pinnacle of
most of their goals and objectives andneed to and then transition into some new

(10:54):
goals and objectives. So your planis really a series of goals that have
a series of steps, and someof those steps might be to avoid market
timing and other things mentioned and otherthings that we're going to mention as we
continue to discuss customize financial planning andincomplaining for you, our funderment joalphas five
one, three, five seven,five, nine, six five four calls.
We can help, but stay tune. You're listening to the Sound Money

(11:16):
Investment Show with Brown Financial Advisors hereon fifty five cars the talk station.
Opinions expressed are solely those of BrownFinancial Advisors and should not be interpreted as
specific advice. Materials presented are believedto be from reliable sources and no representations
can be made as to its accuracy. All ideas and information should be discussed
in detail with one of our qualifiedinvestment advisors prior to implementation. Market based

(11:39):
investments involve risk, and past performanceis no guarantee of future results. Insurance
based investments offer guarantees based upon theclaims paying ability of the issuing company.
All insurance, tax and mortgage servicesare offered through Brown Insurance and Tax Advisors
LLC. Brown Financial Advisors and BrownInsurance and Tax Advisors are affiliated companies and
may only transact business in those statesand which registered or were otherwise legally permitted.

(12:03):
Welcome back to the Sound Many InvestmentShow. Brown Financial Advisors. I'm
Greg Brown and I'm James Bourton.We are a registered investment advisory firm.
We are independent. We do ourfor clients, not companies. That's Main
Street and not Wall Street our funder, but the office five one three,
five seven five siour website Brown FinancialAdvisors dot com, email team at Brown

(12:24):
Financial Advisors dot com, and ourhome office is in MILFORDBOO WELSTO have locations
in Blue Ash, Westchester and Florence. Greg Well, let's we cruise along
with this subject today, creating acustom retirement and income plan. So what
does it mean to have a customplan? And do you have a plan?
James said, if you you havea plan, whether it's to succeed

(12:45):
or to fail, guess which onewe want to help you with today.
I'm reminded of the song lyric andthis is I think Rush, but it
goes connect this. If you choosenot to decide, you still have made
a choice. Yes, So don'tbe today's Tom Sawyer. Yeah something all
right? Well that was an awesomeband, three guys and they just and
they went all the way then untilNeil the drummer just couldn't go anymore.

(13:09):
What anyway? Gosh, I wastoo young to even appreciate that music at
the time, but that drumming,see that was that was the queue.
We're talking eclectically about the past andthe sirens who to remind us to keep
moving forward. Run from this iron. So here we go. What about
a custom plan for you? Today'sgoal? Here? We're simple with this.

(13:33):
Here's the problem. A lot ofplans that we've seen people bring into
us either don't exist. They're singlepage. They're just an investment statement to
say, here's the stuff I own, and I'm diversified because I own lots
of stuff. Ouch, a littlemisguided needs some help or best cookie cutter
plans not good enough. We needto do better. So what do you
think some of these have in common? Well, James, share some thoughts

(13:56):
as we go forward here, Sincetoday's show is all about planning. Income
needs, cash flow, understand yourrisk tolerance, inflation protection, meeting it,
seeding inflation so you can have enoughcash flow to actually spend some of
your money too and still have itlast as long as you do not outliving
your money. I mean, thelist goes on. Those are those are
objectives that are built into the overallgoal of planning. James, we see

(14:18):
it all the time. The goalis to have a successful retirement. Great,
you're retired now, is it justgoing to be automatic. You know
what your plan? Well, Iplan to have enough money each month,
you know, pretty much make ithow long lifetime, overcome what inflation?
At what risk level? Hopefully thecorrect one. Do your investments line up
with your risk they better, whereyou'll react, you'll market time, Just

(14:41):
it goes on and on. Sothere's really more you drilled down elements to
an actual plan. That's why theone pager and the cookie cutter just won't
work. James. Yeah, soas far as having a financial plan,
and maybe this is the importance ofwhy you should have one. And let's
kind of, you know, backtrackjust a little bit, because you hear

(15:01):
the term thrown around quite a bit, kind of loosely at that as you
heard all the time assumingly on theinternet, it must be true. If
it's on the internet, it's onthe news. Financial planners, advisors,
salespeople talk about it, they're marketingrefers to it as well. So you
need a financial plan. But that'sthe resounding message. But maybe the question

(15:22):
is why. Well. According toa recent Tdmare Trade study called Goal Planning
Survey, fifty six percent of Americansage twenty five and above feel that they
have a good grasp on their investmentsand understand how their assets are allocated.
Now that means of those who actuallyhave a plan, fifty six percent.
That means forty four percent do not. So you can always say the positive

(15:46):
is more than half and the negativeis well almost half. Forty four percent
don't have a plan. And ofthose, again who actually have a plan
in place, they are the oneswho feel that they have a good grasp
on their investments and they understand howtheir assets are allocated. That's like saying
what do you own and why doyou own it? So again, those
with the plan also tend to havea higher savings goal, and part of

(16:08):
the savings is the investment goal forretirements. Yeah, I was just thinking.
I was just thinking about the optimismand some numbers, I know,
some of these are like statistics.Yeah, and then thinking of optimism.
You know, the other day atthe copier when it wasn't working and it
was about you know, toner andsome percentage of it being empty, and

(16:30):
it looked like, you know,was acting like it was empty. And
then Julie in our office comes along. She says this, She says,
James, it still shows that it'sit's more than half full, And I
thought, did you catch that?That's that optimism. We get so deep
into numbers and things that I don'tknow if we're always as optimistic as we
should be. We just get sointo the black and white. You should

(16:52):
have fun with this. All thosenumbers you just heard, you should take
away there's a positive outcome for youwaiting to happen by having a custom plan
for you doing all the things ingredientwise that make a wonderful recipe that's pleasing
to the palate. And it canbe a fun process filled with optimism,
hope, and a lot of thingsthat drive good health, wellness, prosperity.

(17:17):
And if you're a little late tothe party of being an optimist and
a happy person with a bouncing yourstep, can I invite you to start
today and do it aligned with yourretirement opportunity, because that's really part of
your plan too, is to livelong and prosper prosper means more than money,
and many of you know that,so let's just make sure we're doing

(17:37):
that. So when we look attaking all this a bit further and taking
and implying some of that research andhaving some confidence in dealing with numbers and
making them real for you. LikeJames says at the end of every show,
you know these things are true andpossible for you. Just because things
sometimes sound too good be true.The old cliche is, well then it

(17:59):
can't be no no, you know, sometimes, darn it, things can
be good enough to be true andtrue for you. So let's look at
But on the other side, ifyou listen to too much of the negativity,
you know, some of this seemsalmost biblical. You know. There's
the adage about there's always going tobe wars, and rumors of wars sound
familiar. It's been happening not justnow, but has happened in the past

(18:21):
decade, has happened fifty years ago, It's going to happen fifty years into
the future as well. That doesn'tmean just simply ignore everything. It just
maybe take it with a grain ofsalt. When it comes to what you
see on the evening news or whatevertime of the day that you're watching,
it would not be on the newsif they did not want you to be
unsettled about what's going on in theworld around us. Yeah, there's such

(18:42):
a flat flood of information. Ifit's not provocative in some way, it's
just not going to capture your attentionor imagination. Unfortunately, I think we
can do some more positive things likethis one. Do you know we can
captivate and capture the facts of yourreality as it relates to money in best
its finance and planning, and feelthat you need a plan that holds together

(19:03):
your diversified financial world again altogether helpsyou understand your situation better, solidify your
goals, your objectives. Kind ofsets you your money and your family on
the right track. Kind of needsyou the financial freedom and the mindfulness to
be okay about feeling okay, youknow, confident and secure. So what

(19:25):
should your financial plan cover, youmight ask, Well, here's some general
areas, pretty important areas. Numberone, income planning, cash flow.
Right, try to retire without cashflow? It'd be specific your foundational income,
typically from social security or maybe youknow you have a pension, not
many of those at least much anymore, and enough of this perhaps to pay

(19:45):
your bills. Okay, so youcan slow down on starting to draw from
your investments. Or what if youdon't have enough foundational income you have a
specific monetary need for cash flow ina month basis in your foundational or other
sources forces of income. Foundational sourcesforces are insufficient, leaving a gap.

(20:10):
So with this gap, we needto use these other assets buckets of money
correctly invested properly, the right risk, for the right duration, the right
purpose. Everything you should align withthe job description kind of stuff to get
you that income. Some of yourmoney will be will be dedicated towards the
income objective. Other money will befor liquidity. Other money will be for

(20:32):
the longer term growth to hedge meaningmeat and beat inflation over long periods of
time, so you'll have ample moneyand resources later to continue to draw from.
Okay, now, what's that partof what's income planning part of an
overall comprehensive financial plan investment planning?Have you defined your risk tolerance for your
plan? Has it changed? Doyou know for a fact, a mathematical

(20:52):
fact, something called the sequence ofreturns could be your worst enemy if you
do the same type of investing,Even if you've done quite well through the
accumulation phase, and you try todo that in retirement, randomness can come
and swipe enough of your money throughsequence of returns and markets that none of
us control and could have you runout of money before you run out of

(21:14):
life, and you'll be standing therewondering what you did wrong. I just
did what I've always done and italways worked. Telling you in distribution phase,
everything changes. You can't do itthe same way. You need to
come see us, and you needto move away from brokerage firms and banks
and these sources of non real financialadvisory information. You know, for example,
do you still go see a pediatrician? No, probably not, And

(21:38):
you shouldn't see these generalists in theseother areas of financial services either because you're
not going to get the care thatyou need. So what impact would being
in the wrong risk level in differentfull market cycles? What's a full market
cycle? It's bear to bull tobear, or it's bull bear bull say
it's a sequence which comes first,that the bear hits you first. Early

(22:00):
in retirement, your mathematical outcomes ofyour sustenance you're maintaining of your wealth through
all seasons of your retirement is challengedwith a head wind that could be of
hurricane wind force and you will notsucceed. So it won't be necessarily anything
you did wrong except not have theright plan with the right mixture the right
tools for the right purpose, forthe right outcome. So are you paying

(22:25):
too much in investment fees? Totalcost of ownerships which you need to understand
not just fees, but all thecost And that's what we'll bring your attention
to make sure that you're not pricingyour investments in properly. Anyway, We'll
continue yes on the fees, thinkof direct and direct overlaps, redundancies,
inefficiencies, etc. Etc. There'smore. There's much more up under about
the alphice five one three five seven, five nine six five four call us

(22:49):
we can help, but stay tuned. Listening to the Sound Money Investment Show
with Brown Financial Advisors here on fiftyfive KRC the Tux Station. Welcome back
to the Sound Many Investment Show withBrown Financial Advisors. I'm Greg Brown and

(23:10):
I'm James Bourton. We are anindependent RIIA. That's our registered investment advisory
firm working for clients and not companies. And it does it does all start
with the plan. That means havinga plan, knowing what you own and
why you own it. So whenyou're seeking advice on an old four one
K four three b IRA rollover investmentplanning, retirement planning, income planning,

(23:33):
tax planning, socialist community of maximization, a Roth conversion analysis for some perhaps
even any way analysis, and anin service rollover all those in more we
can help five one, three,five, seven, five four. Our
website Brown Financial Advisors dot com,email team at Brown Financial Advisors dot com,
and our home office is in Milford, bookstub locations in Blue Ash,

(23:55):
Westchester, and Florence. Greg taxis working with investments, work with the
financial planning in a holistic firm suchas ours. You can go from tax
trapped to tax free and anywhere inbetween more tax friendly as a part of
your overall plan. You know that'staken for granted a lot too. So
we're kind of continuing and on incomeplanning and investment planning. Well, before

(24:17):
we get back to the topic oftoday, what is or what are maybe
some of the reasons Greg for peopleto visit our websites. Well, our
website has a lot of information likeeasy access to us on a complimentary without
any obligation basis to get you fullyassessed where you're at, what you hold,
what it really is, look atthe spread spees, margins, loads
and expenses that you might be payingthe total cost of investing, which might

(24:38):
might might very well be higher thanthat you realize, and to break it
all down and then pivot and showyou a show you the way produce and
create together your financial plan with allthe investments and recommendations, nothing held back.
You make a decision based on good, cold, hard facts. You
understand exactly the cost, and yousee if there's a reason for us to

(25:00):
continue work forward. Also, onour website, go to seminars. There's
a tab there or a button orsomething on there for seminars. Choose a
date. We have upcoming dates eachmonth where we have food fund and finance
and we get together and just sharesome things, make some challenges. Hopefully,
have you come on in and visitus, and then you can always

(25:21):
catch our podcast. You might notbe listening to this show live, probably
not, but you can catch uson podcast anytime. What are some of
the sources for podcasting, Well,besides our website, Yeah, you can,
because we're gonna have the five mostrecent shows listed on our website.
But you can go to Apple,Spotify, places like that as well.
So that's a little information. We'resteering you back to our website for a

(25:44):
reason. Yeah, because there's goodinformation. So income planning and investment planning
big components of the overall financial plan. Why you need cash flow. Once
you know your foundational income SoC securitymaybe pension versus how much you need on
a monthly basis, we establish yourgap through the gap in your financial plan.
We go to work with the rightinvestments to meet those gaps in every
other aspect component of your plan,which can include a lot from the taxes

(26:08):
to understanding how you take a requirementof distributions that money you have to take
from your iras over time, tothe legacy planning. You know, there's
two components of legacy. There's thisside of eternity and the other side.
You want to be prepared for both. And even the areas of long term
health care. Think about that.The two top I guess things about getting

(26:30):
older and money and retirement that worrypeople. Really it's three, but it's
the top two is not having enoughmoney to last a lifetime. Number two
is going to a nursing home.Number three it's just healthcare needs and challenges
and ability to afford healthcare throughout allof the years of your remaining life.
Right, So those are biggies.Nonetheless, when it comes to income planning,

(26:56):
you know last year was a verybad year for bonds. The bond
market to kind of recovery, that'sall good, but you need to be
aware of some alternatives. So ifyou're out there and you have some dormant
cash, so number one, youjust have cash, that's what collecting dust.
Pretty much, we have a stablevalue fund that you could expect two
to four percent currently a promise offuture returns. It's not a compliant statement.

(27:18):
I'm giving you an arrange. Itchanges dynamically time depending when you're listening
to this. Just give us acall. The point is, you don't
have to have dormant dust collecting cashand it can stay fully liquid. That's
the key. You don't have totie it up. But if you're out
there shopping for CDs and you're kindof looking for some safe, safe money,
we have cash opportunities for three yearsnorth of five percent, five years,

(27:40):
five point six to five seven,even touching upon five eight here soon
somewhere in that range. And they'remore liquid than CDs at the bank.
They pay better than CDs at thebank. We call them CD type annuity.
So if they stay in tax referral. They don't hit your tax return
every single year. And maybe here'sthe hierarchy of interest rates. So if
you look at who's gonna pay what, So the CD shoppers out there listen
to this. Banks will pay theworst. Credit unions might pay a little

(28:03):
bit better, but insurance companies willbe better paying better than all of those
above. Yep. So if you'relooking for better rates, you need to
shop with something that will be somethingcalled an annuity. I know that can
be a scary word for some peopleout there, but what we're talking about
is a short term annuity that lastsfrom two years to three years to five
years your choice on all of these. It's a fixed interest rate. It's

(28:25):
called a multi year guaranteed annuity.Every year the interest rate is guaranteed.
Yeah, so if you're a CDshopper, this is an upgrade for you.
So you have the liquidity of thestable value to make something you have
the fixed guaranteed return highly competitive inthe CD quote unquote hype annuity. And
then we kind of morph into somemarket strategies. James take us through one

(28:47):
or two of these and these arelook at these as hybrid investment solutions you
might consider annuity killers. So ifyou're out there doing the dinner circuit and
you're in front of these insurance salestermites getting pounded about why you should have
fixed index annuity. There are somegood wins and good purpose. But right
now we have some market based alternativesthat are just literally smoking gun annuity killers,

(29:08):
and then some bondary replacement strategies tothat kind of give you the world
the upside of equities with the reductionof downside risk or even the elimination of
it. But James Well market basedstrategies remember this, there's always some degree
or measure of risk in a marketportfolio. But what we're doing is we're

(29:29):
trying to mitigate or at least mostlyeliminate the amount of risk that you're taking.
So the concept is called a bufferedindex portfolio and the buffered index and
this is just our marketing name forthe product is a buffered index portfolio,
and these are real what we havefor offerings currently today we have concepts called
the cap and the buffer cap.Think of the cap is your upside potential.

(29:53):
Buffer is your downside protection. Andwe have two different offerings right now
that have a one hundred percent downsideprotection. Yes, one hundred percent downside
protection. Now here's a tradeoff forthe upside potential. There's a cap and
for one of our strategies. Wehave a twelve twelve month but Ford index
that has a cap of nine pointtwo five percent. We also have another

(30:17):
one that has a twenty four monthmaturity, so two years with a cap
of twenty two over twenty two percent. So door number one, commitment of
time is one year. Door numbertwo, commitment of time is two years.
What's a tradeoff. The first onehas a cap of right around nine
percent, the second one has acap of right around an annualized figure of
eleven percent, So twenty two overtwo eleven if you annualize over one.

(30:40):
Yeah, so that nine and aquarter percent in one year. So if
the SMP or the Dow, whichthe less you're performing the two went up
ten percent, you would get ninein a quarter over the two year product
we're offering strategy, it would bewell, the twenty two point two five
percent cap to the upside would meanliterally you would get if the market was
up twenty three, you would gettwenty two point two five it was down

(31:03):
twenty you'd be down zero. Andthen you might call those the pessimistic approaches.
What if you're an optimist, youthink two years out the market's going
to be higher. What might begood for that person who's more optimistic?
James, Well, I would say, if you're just asking me, how
about an uncapped opportunity to the upside? An uncapped opportunity upside? What does

(31:23):
that mean? Well, this onewould be dual directional. Now this is
adding a third layer. Don't meanto get complicated, because it's really not
followed. This the lesser performing theSMP or the DAWs results after two years.
So two years later we opened upour Christmas present and see what the
results of the indices were. Ifthey're up, you make money, well,
how much money? Well, ifit's up twenty, you get twenty,
it's up thirty, you get thirty. It's uncapped to the upside.

(31:47):
What's the catch, Well, thisone doesn't have one hundred percent downside protection,
but it has something you probably don'thave in your market investments already downside,
some protection shock absorption. This onehas a buffer, a fifteen percent
cap to the upside, and itabsorbs the first fifteen percent of any downside.
So if the outcome was negative twenty, you'd be down five the fifteen

(32:07):
percent first fifteen percents absorbed. Here'ssomething interesting. If it's a negative result
between zero and negative fifteen, thatbuffer amount a negative becomes a positive,
So a negative fourteen becomes a positivefourteen. So that's why it's called duel.
You can dually. You can makemoney two ways on the upside of
a market, and in certain rangesof outcomes negatively become positive. These are

(32:31):
things. This is differentiation time oneoh one. This is why we're different.
You don't get this from brokerage firms. You can't get it from insurance
agents acting like financial advisors. Youneed to know there are options. Our
toolbox has a lot of different toolsin it. We joke about the mothership
puts one or two tools in everytoolbag, and then no matter what you

(32:51):
get, you always get the toolsthat the mothership put in the toolbag when
you actually need a whole other setof tools from a whole larger array of
tools and a toolbag. These arejust some examples. So dormant cash solution
for fixed needs and fixed interest ratesfor the CD minded person solutions for the
person that wants to reduce or eliminatedownside risk but have a market strategy that's

(33:12):
boutique in nature and exclusive and uniquein terms of proprietary solutions. We have
solutions traditional investing, all kinds ofsolutions, really cool equity strategies, fund
to pay strategies using ETFs that arelow cost, low redundancy, just a
lot of solutions, all wrapped ina financial plan, income plan that's customized
for you. And one more,because those that we have just mentioned are

(33:36):
designed for future growth. We alsohave a portfolio designed for carent income called
the Designed Income Portfolio, and whatthat is designed to do is provide a
steady stream of income while not depletingthe underlying nest egg. There's more details,
there's much more. Offen number five, one, three, five,
seven, five, nine, sixfive four calls We can help, but

(33:57):
stay tune. You're listening to theSound Money Investment Show. Brown Financial Advisors
here on fifty five cars the talkstation. Welcome back to the Sound Many
Investment Show with Brown Financial Advisors.I'm Greg Brown and I'm James Fourth and

(34:19):
we are an independent registered investment advisorfirm. We do work for clients,
not companies. That's main Street onwall Streets. Our fun number five one
three, five seven, five four, website Brown Financial Advisors dot com.
Email team at Brownfinancial Advisors dot com. Our home office is in Melford,
but we also have locations in BlueAsh, Westchester and floren Shall. Continuing

(34:42):
with creating a customer retirement and incomeplan kind of just arrived at some other
components talked about income planning investment planning. We took a little detour there and
covered some alternative solutions should be awareof. And then James, what with
income always always comes this other thingcalled what oh? Tax planning? And
guess what? It's always tax season. I know it seems more busier than

(35:02):
other times of the year, especiallynow. But tax planning think dollars and
also tax rates. So can youincrease your tax efficiency or at least to
mitigate the taxation on things like yourSocial Security benefits? Not pay more on
your Medicare premiums if you're age sixtyfive plus or at least on Medicare.
How does the different type of incomeget tax That means capital gains tax rates

(35:24):
versus ordinary tax rates. We alsodovetail into iras that means R and D
planning. And this is where maybethe income the cash flow needs intersect.
What are the repercussions, pros andcons of doing qcds? That stands for
qualified charitable distributions. So perhaps ifyou don't have an advantage in your taxes

(35:45):
of donating to your favorite charity usuallychurch, but to your favorite charity from
your checking and Safety's account. Again, there's no tax deduction for many people
to do it that way, Soperhaps replace that with deductions or donations directly
from I'm your IRA that count towardsyour R and D but do not count
as income. That's known as aqualified charitable distribution. Legacy planning. What's

(36:07):
going to happen? Not if,but when you die? Will your errors
and your loved ones, hopefully yourloved ones inherit your stuff in the most
tax efficient ways possible? What willbe your legacy? Long term care?
Do you have a plan for apotential long term care stay? So long
term is like saying long term health, long term care, as far as

(36:28):
staying at home, how's that goingto work? Sometimes the best policy is
to have a long term care policy. Sometimes the best policy is to have
a plan called an asset based protectionplan that addresses these needs. But again,
every part of an overall retirement planshould at least address the potential for
a long term care stay. Gregany thoughts, Oh, just that those

(36:51):
required minum distribution ages have changed withthat secure at two and two zero Dot
A, I'm waiting for a twopoint one yes right now. The new
age for R and DS the startdate is age seventy three and what seems
like in about a decade or soit's going to ramp up to age seventy
five. So initial steps needed tocreate a customized plan. You know,

(37:12):
all the things we described here areneeded in a plan and at the very
least they need to be discussed andfully addressed. Now when it comes to
retirement and creating that plan, alwaysbuild the foundation of income planning component first,
the amount of income you're going toreceive versus amount you need. Determine
the gap, and then we getto work on the appropriate approach. Whether
you want some I know so moneygreen fully insured guaranteed income for life to

(37:36):
fill that gap, and then investyour market risk dollars in such a way
that you don't have a dependency orneed for income from them, or if
you want to use a market approachand use some of the things we describe
and kind of blend them together.Have a multifined approach. It's always good
too, and we tap into someof that by a certain amount to give
you the cash flow you need tofill that gap and keep growing your money

(37:58):
while you're using your money and joinyour money too. So it's just that
that's what gets into the custom aspect, and we just need to understand your
situation better, see what you havenow, make sure we get it all
cleaned up, tightened up, perfectlyaligned with your objectives and cast that powart
and projected as an actual plan foryou. James, Well, the plan
itself, the foundation is cash flow. The foundation is the income plan and

(38:22):
retirement. At least it's supposed tobe more about doing what you want and
less about what you have to do. But once again, your once versus
the needs, they kind of haveto be balanced out. So you have
to be able to spend confidently butalso within your overall budget. Having a
budget, having a plan that requiresyou to know what you spend and to
make sure that you have again enoughcash flow enough income to do that.

(38:45):
So when you retire, how muchincome will be coming in from different types
of reliable sources that might be calledsocial security, might be pensioned. And
by the way, social Security isnot going bankrupt, not anytime soon.
Not as long as we have Paulianswho want to be politicians, it's going
to stay intact. Greg any thoughtson that, I would agree they might

(39:07):
change a little this and that,but if they want to us still be
elected, they got to keep tellingthe truth the way they see it.
So let's talk about So you haveyour income and now James mentioned how important
is to gather that understand that forwhat it is. Then we need to
determine again if there's a shortfall.So if there's a short fall, how

(39:28):
much is it? We'll call thisagain that income gap. Mentioned it several
times throughout this show. Let's sayyour short fall, after factoring in all
the inflows and outflows on a monthlybasis, that your gap is two thousand
per month. When you need toconsider the financial vehicles that will actually help
you bridge that gap and provide theadditional two thousand dollars per month. And
that's net, right, not grosslike net pay spendable money we're talking all

(39:50):
bottom line spendable money. So whenfocusing on the rates of return, looking
at the different investment vehicles, itneeds to be more secondary to the income
development. So, in other words, we need to choose a tool that's
going to provide the income by purposefirst and foremost, then look at rates
of return and other aspects of growth. Don't confuse your income with growth.

(40:12):
It's like asking the old adage aboutpeople want equity rates to return with treasury
risk. Well, some things arejust this is for income, that's for
growth. This is for dividends reinvestedfor growth and cash flow, certain annuity
products or for guarantees of income,but not for growth. It's safety and
income versus safety and growth, oradjusted or managed risk for growth. All

(40:36):
these different categories or characteristics of investmentsmatter. So does your asset pool,
your collection of goodies, income savings, investments support and bridge that income gap?
Currently? Do they do it efficiently? Do they do it tax efficiently?
They do it in terms of whereit's broken down by purpose of money.
What is the withdrawal rate that youneed? What does that mean?

(41:00):
Well, forty thousand dollars a yearis a four percent withdrawal rate if you
have a million dollars, so that'sthe withdrawal rate. To sustain a withdrawal
rate, you need a sustainable investmentto be able to do that while it
stays growing too, because what elseis always happening in the background, Inflation
is fighting for the same dollars you'retrying to use. So hopefully your asset

(41:21):
pool can support the two thousand dollarsper month needed. That's twenty four thousand
a year. So how much moneydo you need to be able to throw
off if you will, the fruitof twenty four thousand a year net after
tax. So here's what is meantby sustainable. If you need an income
gap covered at that twenty four thousanddollars a year, and you have a
million dollars in a nest egg,then thirty thousand a year is at three

(41:43):
percent withdrawal rate, which is goodsustainable rate, no doubt about that.
Very comfortable with that. And ifyou have a three hundred thousand nest egg,
then that thirty thousand dollars per yearwould be ten percent withdrawal rate.
Now you're talking something different. Verydifficult to sustain all the market cycles that
exist for the rescue you forever.So what is your projected life expectancy?

(42:05):
Oh? Not only how long doyou need a certain withdrawal rate up a
certain nest egg to produce a certainamount of cash flow, it's how long
do you have to do it too? Projected life expectancy? How long do
we need to have the plan inorder to supplement the income gap concept here,
Let's say add five to ten yearsto that number to avoid running out
of money prior to running out oflife. Obviously, planning to make sure

(42:28):
that you'll have the withdrawal long enoughis key to everything. Cashflow is key
sustainability. Don't outlive your money.Let's get together and get this right now.
Another part of this is how tomatch different types of financial vehicles or
investments to maybe help meet those objectives. So, for examples, dividends from

(42:49):
securities that means from the stocks,the equities, mutual funds, ETFs,
exchange traded funds, dividends from rates, real estate investment trusts. We're not
a huge fan of the reats oursSometimes the fund becomes in charge of when
you get to buy and sell.That's maybe the biggest drawback to those.
But how about income from annuities,preferably via income writers not annuitizing the contract.

(43:12):
Big difference yield otherwise known as interestfrom fixed income, that would mean
bonds. So if you hear theterm, the terminology, I know English
terminology is to say bonds is fixedincome, fixed income is bonds. Bonds,
you're just simply buying someone's debt.That means government debt, corporate debt.
So whether it be from bonds orbond funds, the interest or the

(43:34):
yield from those designed income portfolio wetouched on a little bit earlier is a
clever approach, I would say tohow you can draw sustainable income from a
portfolio without draining the underlying nest egg. Very important concept because instead of just
simply killing the fruit tree, you'rejust picking the fruit off the tree and
leaving the tree intact to then growmore fruits. Any closing thoughts, greg

(43:59):
nope at is a vital, vitalanalogy there. Keep your orchard intact,
keep picking fruit. It's very important. Don't break branches and componish your tree
of your orchard where there would beno more fruit because of no no more
tree. All right, I'll foundabout the alphas five one three, five,
seven, five nine six five fouragain five one three, five,
seven, five nine six five fourcall us we can help now on behalf

(44:21):
of Greg myself, James, thankyou for listening today, Have a great
week and remember this sound money,where good things are believable, achievable and
true for you
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