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How To Retire At 30 Living Off Investments

in order to live off of
your investments completely. And I know that the title of this video may sound crazy about retiring by 30, and there are a lot of people
out there selling a pipe dream of you can retire by 30
as long as you invest in this course, or go buy real estate and while that may work for some people I'm not here to sell you guys a course or to pitch you on any
kind of product like that. What we're going to
simply talk about here is how much money you need to have invested in order to live off of your investments and essentially not have
to work to earn your money. And believe it or not, there's
actually countless people out there who have in fact
retired as early as 30 years old, by following this exact strategy
that I'm going to outline. So if this idea of retiring early and not having to work for your money is something that interests you. What I want to ask you
guys to do is go ahead and drop a like on this
video just show your support.

I really do appreciate
that as it helps out with the algorithm and allows this video to get shared with more people. But what we're going to look
at in particular in this video is something called the 4% rule, and that essentially
shows you just how much money you need to have set aside, in order to live
off of your investments. Now you can in fact live off of different types of investments like real estate or the stock market for
example or a business that's providing income for you. But what we're going to use in this video as an example is a passive
stock market investment, and we'll show you exactly
how much money you need to have invested in order
to live off of that income. So the goal here with this
strategy is to simply invest your money and have a large
amount of money invested and then you would
essentially be living off of the interest income or
the growth of that money without touching the principle.

And as I'm sure you guys can imagine if you're not touching the principle or your initial investment, then your money could
foreseeably last forever. Now, the sooner you're able to retire is all based on how much
money you're able to save up and how little money you are
spending each and every month, and there's actually a
whole movement of people that are following this
exact strategy, and it's something out there called FIRE, and FIRE stands for financial
independence retire early. And there's a lot of
people who are doing blogs and videos and all kinds of
stuff about this concept, and there are countless
examples out there, of people who have retired
as early as 30 or even less. By following these strategies. Alright guys so there's
basically three steps you have to follow in order to do this, and as I'm sure you can imagine, step number one is to be frugal or to spend as little money as possible, because ultimately what
you're looking to do is save and invest enough
money that the interest or the dividends, or
whatever the growth is pays for your monthly living expenses.

And as I'm sure you guys can guess if your monthly expenses
are $6,000 versus $3,000, you're going to need a
lot more money invested to cover those expenses. So being frugal and saving
as much money as possible is actually going to serve
two different purposes here. Well, number one, the
less that you're living on the more of your paycheck
you're able to save up, and the more of your paycheck
you're able to save up, the more you're able to
contribute to that freedom fund, which will eventually be paying for all of your living expenses. And then second of all by spending as little money as possible
every single month, you actually don't need
to save up as much money to potentially live off of the interest or the growth of your money.

And we're going to go over
those exact numbers right now. Alright guys so step number two
that you have to follow here is going to be a tough one, but that is going to be saving 50 to 70% of your take home income and again, if you're looking to
retire by 30 years old, let's say you want to work from 20 to 30, and then not work for
the rest of your life, you're going to have to take
some drastic actions here.

And that is why you need to live off of a microscopic amount of money. And that's why step number
one is so important, by cutting down as much as possible on those monthly expenses. So people who are trying to do this, you're not going to see
them driving brand new cars, you're not going to see
them going on vacations, they're probably going to be,
you know, eating canned beans and doing campfires in the
backyard as summer entertainment. Not that there's anything wrong with that, but they are literally spending
as little money as possible, because they're focusing
on the long term picture of what they are trying to do. So people who are following
this FIRE movement are often aiming to save 30
times their annual expenses, and that will allow them to
withdraw about 4% per year without basically touching that principle and that is where that
4% rule comes into play.

And that is basically where you're able to draw from an account about 4% per year, and over a long period of
time based on the growth of that account and those investments, it shouldn't be chipping
away at the principle which should in theory
give you unlimited money. So what you're aiming
to do here is to lower your monthly expenses as much as possible.

Figure out what it costs
you to live per year, multiply that by 30, and then
save up that amount of money by saving 50 to 70% of your
paycheck every single week or month, or however often
you are getting paid. Alright so now the question
you guys have been waiting for, just how much money do
you need to have saved up and invested to live off of that money following the 4% rule. Well if your annual expenses
are $20,000 per year, they would recommend having 30 times that amount of money saved and
invested, so $600,000. If your annual expenses were $35,000, that number becomes 1.05 million. If you're somebody
spending $50,000 per year on your living expenses
you would need to have $1.5 million saved and invested,
and for the final figure here, if you spent $100,000 per
year on cars and housing and food and all of that,
you would need to have about $3 million to successfully
follow this strategy.

So I'm sure this goes without saying guys, the best way to follow the strategy and to reach that retirement as quickly as possible is going to be
to keep your monthly expenses as low as possible. And just to put it in
perspective for you guys, every additional $100
that you spend per month, if you follow this is
an additional $36,000 you need to have set
aside in that freedom fund to support that $100 of monthly spending. So if you're serious
about this and you want to retire at 30, or even younger, you are spending literally as little money as humanly possible. Alright so the final step
to following this strategy is going to be passively
investing in the stock market. So most people following this strategy are actually following
the Warren Buffett style of passively investing in index funds. And if you're not familiar,
index funds are basically a way for you to have diversified
exposure to the stock market. Where you're not essentially
picking what stocks are going to outperform,
you're just passively owning the entire market.

So people following this strategy are not out there trying
to beat the market, they are not stock
traders or stock pickers they simply passively invest
in these low fee index funds, one of the most popular ones being VOO or the vanguard 500 fund. And essentially what you are doing, is buying a small piece of the 500 largest publicly traded companies out there, and all the different
dividends those companies pay are all collectively put together, and then you earn a quarterly
dividend from that ETF.

And over the last hundred
years or so the stock market, on average, has returned
about eight to 10% per year. So if you were only drawing
4% from that account, based on historical data, you should never be
touching that principle over a long period of time. And that is how you would
be able to live off of 30 times your annual income, if you save that money and invest it. Now that being said that
is the perfect segue into the sponsor for this
video which is Webull. So if you guys are
interested in getting started with investing in the stock market, this is a totally commission
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any fees to please trades with them and you can
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willing to give you up to two completely free stocks just for opening up an account with them. Number one, if you open the account, you're going to get a free
stock worth up to $250, and then when you fund the account, you'll get an additional
stock worth up to 1000.

So if you do the math there, that is two completely free stocks worth up to $1,250. Now I am affiliated with Webull, so I do earn a commission in the process if you use my link, but
if you guys are interested in grabbing two completely free stocks that is going to be down
in the description below. So finally, the last
thing I want to do here is to put all of this together, and go through a real
example of how you could in fact follow this strategy and even retire by 30.

Now again, this is going to
require some very drastic saving because essentially you're trying to work for about 10 years of your life and then not have to work
for the rest of your life. So most people will never
be able to accomplish this, because of the amount of
sacrifice that is required, with that being said, let's go ahead and run
through the numbers now. So let's say you're earning
a salary of $75,000 per year from your job, and ideally,
you don't have any, you know school loans,
student loans, medical bills, or anything like that. So you haven't gotten
sucked into the consumerism and you don't have like a brand new car so your expenses are as low as possible.

And I know this sounds like
you know theoretical situation, but this was actually
about the same situation I was in, when I graduated
college I was 20 years old, now I was making about $68,000, so a little bit less, but I had no debts, I had no car payment,
and so I was somebody who could have potentially
followed this strategy. So after you pay your
taxes, your take home pay is going to be around $56,250. Now we know already in
order to pull this off, you need to save 50 to
70% of that take home pay in order to actually build up enough money to live off of that income. So we're going to assume
you are saving 70% of that take home pay. So you would need to live off of 30% of that post tax income, which
amounts to just over $16,000, or around $1400 per month.

Now, is that possible? It absolutely is. Is it easy? Absolutely not, you're certainly not going to be going out to the
bar and buying beers or going out to dinner,
you're probably going to be living in a tiny apartment driving an old car and eating at home for breakfast, lunch, and dinner. But if that type of
sacrifice is worth it to you for the long term picture, it is something you may
be willing to do yourself. So each year you would
be saving and investing a staggering amount of money, which is 70% of your take home pay
or just over a $39,000. And that is how you would
be able to pull this off, and assuming you kept that
cost of living the same at around $16,000, just over 16,000. your freedom number, or 30
times your annual expenses, would be just over $506,000. So, how long would it take
you to save up that money? Let's go ahead and answer that now.

Well if you took that
$39,375 per year of money that you are saving and
invested in the stock market, earning 8% return, and
as we said, historically, it's an eight to 10% so we're going to go on the conservative side, well in 10 years at 8%
return career you would have $570,408.40, meaning you could then, if you kept those living
expenses the same, following that 4% rule, not have to work for your
money past that point.

And just to circle back
guys what this really comes down to is the level
of sacrifice involved. Are you really willing to live
off of about $1400 per month, or do you want to have vacations and going out to get dinner
and things like that? So it's not people who are doing this that are out there traveling and dining it's people that are living
as frugal as possible and finding enjoyment
in other areas of life other than just, you know,
spending money on dining and things like that. Now, is this a strategy I
would personally follow? Probably not because I
am one of those people that enjoys traveling, I enjoy dining, and I do spend a little bit
more than the average person, so my freedom number would be
multiple millions of dollars, but instead I follow the
strategy of earning as much as possible and saving a
lot of that earned money, and then eventually allowing
that to supplement my income by having that interest
or the growth of my money paying for a lot of
those things that I want.

And believe it or not,
guys, there are honestly countless people out
there that have followed this exact strategy and
retired at 30 or less. One of the most well known people being Mr. Money Mustache, he has a whole blog where he documented this whole journey of becoming financially
independent and retiring early with both him and his wife. So I'm going to link up his blog down in the description below
as well as a couple of other stories about
people who have followed this exact strategy and
retired at 30 or less. So that's going to wrap
up this video guys, thanks so much for watching. If you're new to this channel, make sure you subscribe and
hit that bell for notifications so you don't miss future videos, and I hope to see you in the next one..

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What Do You Do With Yourself After Retirement? – Dr. Devi Shetty with Sadhguru

Devi Shetty: Sadhguru, I am constantly torn between my senior colleagues, who are extremely skilled surgeons. Sadhguru, the… on the heart there are some procedures, which are done by very few people on this planet. I’ll give an example – I do an operation called pulmonary endarterectomy that’s the blood clots from the leg goes to the lung arteries and it clogs up all the arteries. So twenty… twenty-five years ago there was no cure for this. And once you are diagnosed, you are destined to die within a year. Today people who are on home oxygen for two years, three years you do the operation they can go back to skydiving or they can go to scuba diving. That’s the transformative effect but there are only fifty surgeons less than fifty surgeons in this world who can operate. And like this we have some of my colleagues who are extremely gifted surgeons. They are in their fifties now. And some of them are constantly talking about retirement.

Especially one surgeon he is a extremely gifted surgeon who can fix any damaged valve. He is single, he has no other commitments every other day he talks about going to Banaras or somewhere and retire and I keep telling him that God didn’t create him to retire and meditate. He has to be fixing all these problems So he gives me extension every six months Guruji. So at the end of six months the usual rigmarole starts, he talks about retirement and everybody is depressed in the hospital. So how do you deal with this kind of people? Sadhguru: You must you must give him a one year sabbatical with me Yes, because the need or the idea of retirement enters anybody’s mind because of the monotony of what they’re doing, whatever it may be.

Somebody else may think it's a great thing but in your experience somewhere it's becoming monotonous or stagnant. Stagnation is one thing that human intelligence and human system cannot take. And most of the ailments are because of stagnation stagnation of life. They may be… they may be getting their you know once in three years promotion. They may be making little more money. All these things may be happening but somewhere experientially there’s a stagnation, which could be a major cause for many of the complex ailments that people manufacture within their systems.

The more complex they get you try to create more talented surgeons. I am saying we are manufacturing the problems, we are trying to manufacture a solution. I think as we offer solutions people who have adl… already gotten into problems, they need solutions. But it's very important that we teach people how not to create these problems, so that instead of fifty, you have to produce five thousand expert surgeons to attend to all these people who are on self-help to illness. So I would say a surgeon who is who has a certain competence and who has worked through his life, if he wants to explore something of his own nature, that will be the greatest thing to do because he is not a man without commitment nor competence.

When competence and commitment is there, you should not run him through the rig ram role (rigmarole?) and destroy that possibility. It’s important that he explores something of his own nature, which will make him We don't know what he’ll come up with. You cannot even estimate what he may come up with. I think a sabbatical is good. He may come up with something that you have not thought possible. Devi Shetty: I will… I will convey your message Sadhguru. I am sure he is watching this program.

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Retirement Financial Advice: Money Lessons You Need to Know in Retirement

once your earning years are over and you've built Your Nest Egg for retirement you need to be smart about so many decisions now we're not financial planners and we make that very clear with everyone but we are retired and we do spend time making sure we're doing the right thing financially with our own money because oh bad financial habits and lack of knowledge can actually ruin your we have we have a couple they're good friends and he felt like he knew what to do with the marketplace with his Investments and he clearly didn't because he had his money in stocks when it when they went down and he pulled it out and put it into cash when it went up so for eight years he was on the wrong side of every single one of the stock market moves and because of that he lost a significant amount of his retirement assets and that's really difficult and today we find that they're struggling many of their dreams have vanished and they both actually had to go back to work now there's nothing wrong with work but it's just not what they had planned so we can't emphasize enough right out of the shoot having a financial planner is so important because it gives you a plan it gives you a vision it gives you an idea but it also does this which I think is most important it takes the emotion out of the marketplace which can get the best of you think you know what's going to happen at a new presidential election and frankly you don't that's right so let the experts help you with that because we don't want to have what happened to them happen to you today we want to share some practical ideas that may maintain or even improve your financial situation and again the number one lesson today is don't manage your money without a financial planner and we don't mean a stock broker what we mean is someone who has a fiduciary responsibility to make recommendations that are are really good for you not good for them and they talk to you about the strategies and you might say well sure they do but they also talk to you about withdrawal strategies right how much should you be withdrawing each year in order to preserve your nest day how much do you need each month and then they pull it from the smartest place it needs to come from using tools like tax loss harvesting you can't just take money out of a stock because you want to because you're going to have capital gains right right and you know we're not a big fan of multiple planners but we'll leave that part up to you so the first one is make sure you get a financial planner somebody you're comfortable with the second is keep your emergency fund intact kind of no matter what you need to have emergency savings that doesn't disappear when you retire it's more important than ever to have accessible cash set aside for any type of emergency so two three four months of expenses in a cash account that way your financial planner can invest the rest of your money and always always be thinking about you're going to need more money in 60 days so what can they put you into short term so you want to have this cash account so you can cover any kind of emergency expenses or just if you want to leave stuff in the market a little bit longer you've got some cash or even if you have any big purchases that are coming down the pipe that's true making sure your financial planner knows that you're ready for that so the second thing is the emergency fund now here's another um here's another way that you can get into trouble or you're also a way to dig yourself out of trouble you want to take a look at all your luxuries and make sure that they haven't become a burden because frankly that happened to us we both had jobs we were both working gosh 15 years ago we bought our first boat and we bought four boats over the next 15 years but we could afford it because we both were working we both had money and it was our floating vacation home so to speak I I call the last one that we had a lifestyle about because we went away on that one a lot it was a little bit larger but once we were tired all of a sudden it was like well we don't really want to go out on it the weather isn't good you know we'd rather stay home we'd rather be with for the price of diesel or the price of gas you know the price of storage the price of hauling the price you know all of those things have to be factored in when you have a fixed income yeah and we didn't have the same earning capacity to kind of keep up with the luxury so we stopped using it and then it became a burden like why aren't we using it and it was a year ago now that we decided to sell it and it's sold within a month because we kept really good care of it but the thing is if you have luxuries it's really important to take a look at them and say that's something we're really getting a lot of satisfaction of because it's going to cost you money well there are also luxuries that you have and then there's luxuries you provide for others right so we have six children and we were providing cell phones homeowners insurance auto insurance airline tickets for them and their significant others are partners and you know that was all fine when we were dual income but as they aged and as we aged and as we came into a fixed income place we needed to start peeling some away and giving those responsibilities back to them and they can afford it they all have great jobs and if they're ever stopped but it was a luxury it was to be able to do that for him but but frankly it also gave us a lot of satisfaction a lot of fulfillment to be able to help them right so it was hard for us to Pivot to in our mind take these things away from the kids but they you know at some point they've got to be to stand on their own two feet so and we needed to reduce the support so we sold the boat we paid off two car loans we came to an agreement with the kids and slowly weaning them off of some of these things we've always paid for you know because they they can't afford it and you know they they they're fine with it right they even they say it's kind of silly that you're paying my cell phone bills so it's it's another cord to cut that um you know it's hard to do but we want to encourage you to do it yeah so that was the third one the fourth one is you know really trying to figure out how to live a little below your means you know and that's new for us for our entire career as our income went up our living style and our cost of living and everything we did went up with it you know hard work learning and growing you know we were climbing the corporate ladder Mark was building his business you know it was easy to have your lifestyle kind of follow you yeah and you know we both come from humble beginnings and we improved our lifestyle as we went up but then then it's sort of when when you retire you have to think okay well my income's not going to keep going up as a matter of fact it's going to go down so how do we want to live what are some things we can do to live within our means and even underneath our means so and there were a couple things we had to agree to right so you know I call it shopping for sport right so there's there's no more you're better at that than pickleball kind of just opening up and saying oh you know look what just came into my feed I'll take a look at those earrings or that bracelet or those dresses or those sunglasses I think about it I kind of have a little bit of a sunglass addiction so so you know there was you know we agreed that we would do no more shopping for sport yeah it was one of Instagram Amazon it's so easy to spend money today and you get hooked on this new game you don't even leave your house you don't even leave your house you know keeping up with the Joneses that's not necessary anymore right you know who are the Joneses anyway today it's other retirees we're not taking on any more debt we've paid down most of our debt you know again we have a financial planner and you know we have a more modest wardrobe I mean our fancy or fanciest clothes are for our YouTube channel right and we're eating out less we made the agreement that for health and economic reasons we would eat out less so leave living below your means is something you can control and it's something that you can put some time and intention into so another really important thing to get to know is everything about social security and we we don't know that much about it so our financial planner and our accountant has said you don't need to take it yet and that's kind of all we're thinking about at this point they'll let us know when it makes sense and when it makes sense it'll make sense but you have to really understand or have someone coaching you on what's important because everyone's financial situation is different yeah and I really believe the more you know about it the better off you'll be even if you do your own investigation you know Social Security was not meant to be your primary source of income as you age in America it was meant to be a supplemental income so you have to understand the amounts you can get at what future ages and can you still work and does your state tax it or not you know there's a lot of rules around Social Security and my recommendation would be just get to know your rules in your state around your age just for the knowledge I don't know but I think there's a certain amount of uh you can't earn a certain amount of money and still get Social Security I don't really know but you have to know that's I guess that's the point you really need to know everything about social security check with your account and your financial plan right here's a big one for us and it should be for you too I think you know money will never buy you happiness and we've heard that like our whole lives and so we actually did a little bit of research and you know what really defines happiness for us and we came across this quote and part of it is from Warren Buffett but it says you know we want to do what we want when we want with whom we want for as long as we want and that to us will Define our happiness you know now some of what you do will require money but it's not all about buying stuff and things you know most of what we do for happiness now is experiences I I would think that for us and tell me if you agree but the something we just spent money on is giving us more happiness now for a very low value than anything else I remember paying forever you know what it is your pickleball racket pickleball so we joined the YMCA uh for like eighty dollars a month for the family we bought a pickleball racket for 100 bucks and six balls for eighteen dollars and we're getting like five or six hours of use out of that each week yeah that's happiness that really is making us happy it's not a new car it's not a new set of golf clubs right it's not what we're used to thinking that was um would create happiness and we're also looking at vacations differently right now that we have the full seven days to ourselves many vacations to visit friends or family you know they become Tuesday Wednesday Thursday versus the high traffic weekend Friday Saturday Sunday so many vacations Beach days lunch dates you know we just renting a boat for a day we're doing that with company comes we're renting pontoon boats now for the day to take companies out it's three hundred dollars for a day which in one respect sounds like a lot but it's a lot cheaper than owning a boat right that's true so we still get out on the water now look you clearly need money in retirement we all can agree on that but how much do you need and how much is enough you've got to figure out how much you have how much you can pull out each month and how long it's going to last those are key questions you need to work through with your planner and your account yep and paying attention to some of these things that we just shared will help guide you and keep you out of trouble now we hope you enjoyed this video and if you did you're going to like this next one called the truth about early retirement what they don't tell you it's one of our most popular videos and you know we're not getting any younger so why steal these fabulous years from ourselves our family and our friends watch this one next

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Your Tell-All Guide to Saving for Retirement

I'm Britt, the co-founder of Dow Janes, and 
every single week I have someone asked me   how they can start saving for retirement 
or how much they need or if it's too late   to start saving. Today, I'm going to share my 
top tips for starting to save for retirement.   And don't worry; it's easier than you think.
If you want more ideas for saving, investing,   and making the most of your money, 
don't forget to hit the subscribe button   and the bell so you don't miss any new 
videos. And if you liked this video,   definitely give it a thumbs up.
All right. So, there are some misconceptions   about retirement saving that I want to address. 
First, one thing people often ask us is how much   do I need for retirement? What's the magic number? 
And the truth is it varies widely.

It depends on   where you want to live or what lifestyle you 
want to have or when you want to retire. Are   you trying to retire at 40 or at 70?0.
If you take anything away from today, I want   you to just start saving 20% of your pre-tax 
income for your retirement, and you'll be fine.   To learn more though, keep listening.
Okay. So how do you start saving for   retirement? What you do is you follow the roadmap 
steps. You make sure you're doing things in the   right order. So we have a whole nother video 
on the roadmap steps, but just to recap,   the first thing you want to do is make sure 
you're spending less than you make each month.
  The second thing is to pay off any 
high-interest rate debt you have, which is   anything with an interest rate over 7%, then 
you want to build up an emergency fund.

And   then once you have those three things in place, 
you're ready to start saving for retirement.   So, to do that, you're going to find your monthly 
savings number. You can use a simple retirement   calculator to figure out how much you want to have 
in retirement. I'll link to one in the description   below. What you'll do is you'll add in your 
current savings, anything you've already saved   for retirement already, anything you expect to get 
from social security, and then you'll adjust the   savings amount to see exactly how much you need 
to save each month to be on track, to meet your   retirement goals. It's a super easy calculator, 
you just enter the numbers. It'll spit out exactly   what you need to do, and that number, that savings 
amount, that's going to be your monthly goal.
  So, if you don't already have an account, 
you'll open up a retirement account,   and that's where you'll begin to transfer that 
savings amount to that account each month.
  Where should you save your money? There are 
different types of retirement accounts.

So,   if your employer offers matching, then you'll 
want to open a 401(k) or 403(b). In addition,   you can open a Roth IRA or a traditional IRA. 
IRA stands for Individual Retirement Account.   If you're self-employed, you can also open a SEP 
IRA. So for the Roth traditional or SEP IRAs,   you can open those at any brokerage places 
like Vanguard, Charles Schwab, Fidelity,   or with a robo-advisor like Wealthfront or 
Betterment. Any of those places offer retirement   accounts. So, it's super easy to get started. 
Then if your employer offers 401(k) matching,   you definitely want to advantage of that.
So, what is 401(k) matching? It's when you   save money for your retirement and your company 
contributes the same amount that you save.   They'll often match up to a certain amount 
or a certain percentage of your salary.
  So, if your company matches 4% of your 
salary and you make $5,000 per month,   you could contribute $200 per month towards your 
retirement, and your company would contribute an   additional $200 per month.

So you basically get 
$200 in retirement money for free each month.
  It's a way for companies to incentivize 
their employees to save for retirement.   So, if your employer offers this, definitely take 
advantage of it. It's the easiest free money out   there. And make sure you're contributing the 
maximum amount that they're willing to match.
  Okay. The next thing you'll do, if your employer 
doesn't offer matching, or if you're, um, if   you've already maxed that out, the next thing 
you want to do is max out your contribution to   your Roth or your traditional IRA. So, each year, 
the IRS limits the amount that you're allowed to   contribute. In 2021, the amount is $6,000.
If you're over 50, you have an extra bonus. You   can contribute $7,000. So, try to contribute the 
maximum amount to those accounts each year. So,   max out your 401(k) to where your company matches 
max out your Roth or your traditional IRA. If   you're self-employed, you could also contribute to 
your SEP IRA. If you're a great saver and you're   saving more than those amounts, you can open 
your own brokerage account.

So, a non-retirement   account, and save the money there. You can use 
that money for whatever you want, but you can   know that you're saving that for retirement.
Once you've saved the money in those accounts,   what you're going to do is invest that savings. So 
for the easiest and simplest way to get invested,   you'll invest in target date funds. These 
are pre-made portfolios that allocate your   money to a mix of stocks and bonds that 
are appropriate based on your age.
  If you want to invest in index funds yourself, 
or if you're picking a fund that your employer   offers, then you can use these rules of thumb. 
Generally, you want your portfolio to be invested   in the percentage of stocks that is equal to 
120 minus your age.

So if you're 20 or younger,   you want to have 100% of your portfolio 
in stocks. If you're 30, you want 90%   in stocks, for example. And just a quick 
note that if you invest in target date funds,   that will do that for you. The allocation 
changes the allocation of stocks and bonds   changes over time as you get older.
One quick thing to know is that you   actually don't need to take your money, your 
retirement money, out the year that you retire.   You can leave it invested while you're in 
retirement and just take out what you need,   which means you actually have more time 
than you think for your money to grow.
  So, hopefully that gives you some peace of mind. 
If you're getting started later in the game,   if you're wondering how much you should be 
saving in retirement savings each month,   we have a couple of rules of thumb for you.

And 
the bottom line is the sooner you start saving for   retirement, the less you actually have to save, 
because if you start sooner and you invest that   money, it will grow and it will grow over a longer 
period of time. If you're starting later in life,   you have to save more because it has less 
time to grow. So, if you're in your twenties,   you can save 15% of your pre-tax income each 
month and you'll be set. If you're starting   in your thirties, you want to save 20% of your 
pre-tax income. If you don't have anything saved   and you're just starting to save for retirement in 
your forties or your fifties, you'll need to save   even more since you're starting later and your 
money has less time to grow. If this is you, watch   out for our next video on how to start saving 
for retirement if you're in your fifties.
  All right, the sooner you start saving for 
retirement, the easier it is.

So, here's a recap   of the steps: One, follow our wealth building 
roadmap, so you know what to do in what order.   Two, find your monthly savings. Number three, open 
a retirement account. Four, take advantage of free   money. Five, max out your contributions. Six, 
invest your retirement savings, and seven,   contribute to your retirement savings each 
month. If you want to learn more about how   to build your wealth and invest your retirement 
savings, then definitely check out our webinar,   Think Like an Investor. The link's in the comment 
below.

All right. Thanks for watching..

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How to Setup Solo 401k Plan to Invest in Gold?

hi there Welcome to our gold investment video series in today's video we'll discuss a question we received from a follower how to set up solo 401k plan to invest in gold let's break it down gold offers protection against inflation currency fluctuations and helps balance portfolios by reducing risk first check your eligibility solo 401K is perfect for self-employed professional or business owners without full-time employees other than spouses next choose your solo 401K provider wisely look for plan flexibility a clear fee structure and excellent customer service setting up involves registering your business applying for an in selecting and researching a provider completing the application and signing the adoption agreement one once set up open a self-directed solo 401K for full control fund it and decide on your gold investment be it bullion bars coins or even ETFs keep compliance in mind gold should have at least 0.995 Purity and must be stored in an IRS approved depository remember no self-dealing manage your solo for 01k with regular contributions reporting and keeping up with regulatory changes optimize your gold investment by monitoring the market diversifying and doing periodic assessments remember while gold is globally recognized it has its risks it can be less liquid volatile and unlike stocks doesn't pay dividends in conclusion investing in gold through a solo for 01k can diversify and stabilize your retirement savings always consult with a financial adviser to ensure this strategy aligns with your retirement goals thank you for watching our video for more in-depth information about gold Iris upto-date comparison of the top gold Ira companies special promotional gold Ira deals and a free gold Ira investment kit visit raremetal blog.com or click the link below

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401K to Gold IRA Rollover

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How To Save For Retirement: Suze Orman Shares Her Best Money Advice | TODAY

>>> AND WE’RE BACK WITH OUR >>> AND WE’RE BACK WITH OUR SPECIAL SERIES LIVING LONGER SPECIAL SERIES LIVING LONGER TODAY, EXPLORING WAYS TO LIVER TODAY, EXPLORING WAYS TO LIVER NOT ONLY LONGER BUT BETTER. NOT ONLY LONGER BUT BETTER. >> THIS MORNING WE’RE FOCUSING >> THIS MORNING WE’RE FOCUSING ON YOUR FINANCES AND THE NEW ON YOUR FINANCES AND THE NEW ADVICE EXPERTS ARE GIVING TO ADVICE EXPERTS ARE GIVING TO MAKE YOUR MONEY REALLY LAST.

MAKE YOUR MONEY REALLY LAST. >> THE GOOD NEWS AMERICANS ARE >> THE GOOD NEWS AMERICANS ARE LIVING LONGER, WHAT THAT MEANS, LIVING LONGER, WHAT THAT MEANS, A NEW FOCUS ON MAKING YOUR MONEY A NEW FOCUS ON MAKING YOUR MONEY LAST. LAST. >> AS YOU’RE PLANNING FOR YOUR >> AS YOU’RE PLANNING FOR YOUR FUTURE, DON’T UNDERESTIMATE HOW FUTURE, DON’T UNDERESTIMATE HOW LONG YOU’RE GOING TO LIVE. LONG YOU’RE GOING TO LIVE. >> IN FACT, ABOUT ONE OUT OF >> IN FACT, ABOUT ONE OUT OF EVERY FOUR 65-YEAR-OLDS TODAY EVERY FOUR 65-YEAR-OLDS TODAY WILL LIVE PAST 90. WILL LIVE PAST 90. >> THE OLD ADVICE USED TO BE >> THE OLD ADVICE USED TO BE THAT AS YOU’RE PLANNING FOR THAT AS YOU’RE PLANNING FOR RETIREMENT EXPECT TO LIVE INTO RETIREMENT EXPECT TO LIVE INTO YOUR 80s.

YOUR 80s. NOW THE EXPECTATION IS THAT NOW THE EXPECTATION IS THAT YOU’LL HAVE A GOOD CHANCE OF YOU’LL HAVE A GOOD CHANCE OF LIVING INTO YOUR 90s, MAYBE EVEN LIVING INTO YOUR 90s, MAYBE EVEN CELEBRATING YOUR 100th BIRTHDAY. CELEBRATING YOUR 100th BIRTHDAY. >> WITH LONGEVITY CAN COME THE >> WITH LONGEVITY CAN COME THE ADDED STRESS TO SAVE MORE. ADDED STRESS TO SAVE MORE. >> PLANNING FOR THE FUTURE HAS >> PLANNING FOR THE FUTURE HAS BECOME A LOT MORE CHALLENGING BECOME A LOT MORE CHALLENGING AND REALLY THE ONUS IS NOW ON AND REALLY THE ONUS IS NOW ON THE INDIVIDUAL MORE THAN EVER.

THE INDIVIDUAL MORE THAN EVER. >> SO HOW DO WE MAKE SURE WE’RE >> SO HOW DO WE MAKE SURE WE’RE FINANCIALLY PREPARED FOR ALL FINANCIALLY PREPARED FOR ALL THOSE EXTRA YEARS? THOSE EXTRA YEARS? IT’S EASY. IT’S EASY. JUST CALL SUZE ORMAN, A PERSONAL JUST CALL SUZE ORMAN, A PERSONAL FINANCE EXPERT. FINANCE EXPERT. SHE HOSTS SUZE ORMAN’S WOMEN AND SHE HOSTS SUZE ORMAN’S WOMEN AND MANY PODCASTS. MANY PODCASTS. >> WE’RE LIVING LONGER. >> WE’RE LIVING LONGER. THAT’S GREAT, BUT THE BAD NEWS THAT’S GREAT, BUT THE BAD NEWS IS, WE SURVEYED OUR TODAY.COM IS, WE SURVEYED OUR TODAY.COM AUDIENCE. AUDIENCE. THEY SAID 60% OF THEM FELT LIKE THEY SAID 60% OF THEM FELT LIKE THEY DON’T HAVE THE AMOUNT OF THEY DON’T HAVE THE AMOUNT OF MONEY THAT THEY’RE SAVING RIGHT MONEY THAT THEY’RE SAVING RIGHT NOW THAT, THAT IT WON’T LAST NOW THAT, THAT IT WON’T LAST THEM THROUGH THEIR RETIREMENT.

THEM THROUGH THEIR RETIREMENT. >> IF YOU REALLY THINK ABOUT IT, >> IF YOU REALLY THINK ABOUT IT, YOU GUYS, MOST PEOPLE BARELY YOU GUYS, MOST PEOPLE BARELY HAVE THE MONEY TO PAY THEIR HAVE THE MONEY TO PAY THEIR BILLS TODAY LET ALONE SAVE IN BILLS TODAY LET ALONE SAVE IN THEIR MINDS FOR THE FUTURE. THEIR MINDS FOR THE FUTURE. >> PEOPLE FEEL LIKE THEY CAN’T >> PEOPLE FEEL LIKE THEY CAN’T SAVE. SAVE. >> THEY JUST FEEL THAT WAY, AND >> THEY JUST FEEL THAT WAY, AND THEY HAVE TO CHANGE THAT BECAUSE THEY HAVE TO CHANGE THAT BECAUSE THEY ARE GOING TO SPEND MORE THEY ARE GOING TO SPEND MORE YEARS IN RETIREMENT THAN THEY YEARS IN RETIREMENT THAN THEY EVER DID WORKING IF YOU THINK EVER DID WORKING IF YOU THINK ABOUT IT BECAUSE MOST PEOPLE ABOUT IT BECAUSE MOST PEOPLE THINK THEY’RE GOING TO RETIRE AT THINK THEY’RE GOING TO RETIRE AT 65, MAYBE THEY WORK 30 YEARS, 65, MAYBE THEY WORK 30 YEARS, THEY’RE GOING TO LIVE TO 100 THEY’RE GOING TO LIVE TO 100 POSSIBLY.

POSSIBLY. >> OENGWNING A HOUSE WAS ALWAYS >> OENGWNING A HOUSE WAS ALWAYS THE PLAN, BUT FOR THESE THE PLAN, BUT FOR THESE MILLENNIALS, THEY’RE OPEN ABOUT MILLENNIALS, THEY’RE OPEN ABOUT THE FACT THEY THINK THEY’LL THE FACT THEY THINK THEY’LL NEVER BE ABLE TO AFFORD A HOUSE, NEVER BE ABLE TO AFFORD A HOUSE, NEVER MIND SOME LONGEVITY OR NEVER MIND SOME LONGEVITY OR 401(k). 401(k). >> THAT’S NOT SUCH A HORRIBLE >> THAT’S NOT SUCH A HORRIBLE THING. THING. I DON’T THINK THAT THE KEY TO I DON’T THINK THAT THE KEY TO YOUR RETIREMENT IS OWNING A YOUR RETIREMENT IS OWNING A HOME.

HOME. I THINK THE KEY TO YOUR I THINK THE KEY TO YOUR RETIREMENT IS HAVING ENOUGH RETIREMENT IS HAVING ENOUGH MONEY TO PAY WHATEVER YOUR MONEY TO PAY WHATEVER YOUR EXPENSES HAPPEN TO BE SO THE KEY EXPENSES HAPPEN TO BE SO THE KEY IS TO GET RID OF AS MUCH IS TO GET RID OF AS MUCH EXPENSES AS YOU CAN, DON’T HAVE EXPENSES AS YOU CAN, DON’T HAVE DEBT. DEBT. IF YOU DO HAVE A HOME, MAKE SURE IF YOU DO HAVE A HOME, MAKE SURE YOUR MORTGAGE IS PAID OFF BY THE YOUR MORTGAGE IS PAID OFF BY THE TIME YOU RETIRE. TIME YOU RETIRE.

THAT WOULD BE MY NUMBER ONE TIP THAT WOULD BE MY NUMBER ONE TIP TO TELL EVERYBODY THEY HAVE GOT TO TELL EVERYBODY THEY HAVE GOT TO DO IF THEY DO OWN A HOME. TO DO IF THEY DO OWN A HOME. >> WE’RE GOING TO GET INTO THAT. >> WE’RE GOING TO GET INTO THAT. WE HAVE THE THREE W’S. WE HAVE THE THREE W’S. THE FIRST IS WHERE. THE FIRST IS WHERE. WHERE IS THE BEST PLACE TO WHERE IS THE BEST PLACE TO INVEST YOUR MONEY SO IF YOU DO INVEST YOUR MONEY SO IF YOU DO HAVE 30ISH YEARS OF RETIREMENT HAVE 30ISH YEARS OF RETIREMENT YOU’RE SET? YOU’RE SET? >> I’VE SAID FOR A LONG TIME, >> I’VE SAID FOR A LONG TIME, JUST FORGET THE TAX WRITE OFFS JUST FORGET THE TAX WRITE OFFS OF YOUR PRETAX 401(k) OR IRA. OF YOUR PRETAX 401(k) OR IRA. FORGET THOSE NOW, AND IF YOUR FORGET THOSE NOW, AND IF YOUR CORPORATION OFFERS IT, CAN YOU CORPORATION OFFERS IT, CAN YOU CO CO DO A ROTH 401(k) OR A ROTH IRA DO A ROTH 401(k) OR A ROTH IRA WHICH ARE AFTER TAX WHICH ARE AFTER TAX CONTRIBUTIONS.

CONTRIBUTIONS. WHY? WHY? YOU DON’T HAVE TO WORRY WHAT THE YOU DON’T HAVE TO WORRY WHAT THE TAX BRACKETS ARE GOING TO BE 20, TAX BRACKETS ARE GOING TO BE 20, 30, AND 40 YEARS FROM NOW. 30, AND 40 YEARS FROM NOW. I PERSONALLY THINK THEY’RE GOING I PERSONALLY THINK THEY’RE GOING TO SKYROCKET OVER THE YEARS, SO TO SKYROCKET OVER THE YEARS, SO THEREFORE WHAT YOU SEE IS WHAT THEREFORE WHAT YOU SEE IS WHAT YOU GET IN A ROTH IRA OR A ROTH YOU GET IN A ROTH IRA OR A ROTH 401(k). 401(k). AGAIN, IT’S PRETAX VERSUS AFTER AGAIN, IT’S PRETAX VERSUS AFTER TAX, BUT AFTER THAT IT’S TAX TAX, BUT AFTER THAT IT’S TAX DEFERRED VERSUS TAX FREE.

DEFERRED VERSUS TAX FREE. IT’S FOR YOUR BENEFICIARIES IN A IT’S FOR YOUR BENEFICIARIES IN A PRETAX ACCOUNT THEY’RE GOING TO PRETAX ACCOUNT THEY’RE GOING TO PAY TOTAL TAXES ON IT. PAY TOTAL TAXES ON IT. >> LET’S GO BACK TO DEBT FOR A >> LET’S GO BACK TO DEBT FOR A SECOND. SECOND. FOR PEOPLE WHO HAVE STUDENT FOR PEOPLE WHO HAVE STUDENT LOANS, THEY’VE GOT CREDIT CARDS, LOANS, THEY’VE GOT CREDIT CARDS, THEY’VE GOT THAT MORTGAGE.

THEY’VE GOT THAT MORTGAGE. HOW DO YOU PRIORITIZE THE DEBT? HOW DO YOU PRIORITIZE THE DEBT? WHAT DO YOU PAY AND WHEN? WHAT DO YOU PAY AND WHEN? >> STUDENT LOAN DEBT IS THE MOST >> STUDENT LOAN DEBT IS THE MOST DANGEROUS DEBT YOU CAN HAVE BAR DANGEROUS DEBT YOU CAN HAVE BAR NONE BECAUSE IN 90% OF THE NONE BECAUSE IN 90% OF THE CASES, 99%, IT IS NOT CASES, 99%, IT IS NOT DISCHARGEABLE IN BANKRUPTCY. DISCHARGEABLE IN BANKRUPTCY. SO THEY HAVE THE LEGAL AUTHORITY SO THEY HAVE THE LEGAL AUTHORITY TO GARNISH YOUR WAGES AND TO TO GARNISH YOUR WAGES AND TO REALLY THEN DECREASE YOUR INCOME REALLY THEN DECREASE YOUR INCOME SO STUDENT LOAN — SO STUDENT LOAN — >> TAKE CARE OF THAT FIRST. >> TAKE CARE OF THAT FIRST.

>> FIRST THAT. >> FIRST THAT. THEN IF YOU HAVE CREDIT CARD THEN IF YOU HAVE CREDIT CARD DEBT THAT NEEDS TO GO BECAUSE DEBT THAT NEEDS TO GO BECAUSE DEBT IS BONDAGE. DEBT IS BONDAGE. YOU GOT TO GET OUT OF THAT. YOU GOT TO GET OUT OF THAT. AND THEN YOU START WORKING, IF AND THEN YOU START WORKING, IF YOU’RE GOING TO STAY IN YOUR YOU’RE GOING TO STAY IN YOUR HOME FOR THE REST OF YOUR LIFE, HOME FOR THE REST OF YOUR LIFE, GET RID OF YOUR MORTGAGE GET RID OF YOUR MORTGAGE PAYMENT. PAYMENT. >> I WANT TO FOLLOW UP ON THAT. >> I WANT TO FOLLOW UP ON THAT. YOU DON’T WANT TO HAVE A YOU DON’T WANT TO HAVE A MORTGAGE, A LIVE MORTGAGE STILL MORTGAGE, A LIVE MORTGAGE STILL GOING BY THE TIME YOU RETIRE. GOING BY THE TIME YOU RETIRE. WHY? WHY? >> BECAUSE YOUR MORTGAGE PAYMENT >> BECAUSE YOUR MORTGAGE PAYMENT IS YOUR HIGHEST MONTHLY EXPENSE IS YOUR HIGHEST MONTHLY EXPENSE THAT YOU’RE GOING TO HAVE BAR THAT YOU’RE GOING TO HAVE BAR NONE.

NONE. >> WHEN YOU RETIRE. >> WHEN YOU RETIRE. >> IT’S FAR EASIER TO PAY OFF >> IT’S FAR EASIER TO PAY OFF YOUR MORTGAGE THAN TO SAVER THE YOUR MORTGAGE THAN TO SAVER THE MONEY TO GENERATE THE INCOME TO MONEY TO GENERATE THE INCOME TO PAY OFF YOUR MORTGAGE. PAY OFF YOUR MORTGAGE. YOUR GOAL IN RETIREMENT IS TO BE YOUR GOAL IN RETIREMENT IS TO BE TOTALLY DEBT FREE 100% IN TOTALLY DEBT FREE 100% IN RETIREMENT. RETIREMENT. IF YOU DON’T HAVE ENOUGH MONEY, IF YOU DON’T HAVE ENOUGH MONEY, DECREASE YOUR EXPENSES, AND THEN DECREASE YOUR EXPENSES, AND THEN YOUR MONEY WILL GO FURTHER.

YOUR MONEY WILL GO FURTHER. >> GOT YOU. >> GOT YOU. >> WHAT ABOUT WHEN, WHEN DO YOU >> WHAT ABOUT WHEN, WHEN DO YOU START? START? I KNOW, WHEN WE’RE BORN WE I KNOW, WHEN WE’RE BORN WE SHOULD START SAVING. SHOULD START SAVING. >> YOU HAVE THE 200 BUCKS WHEN >> YOU HAVE THE 200 BUCKS WHEN YOU’RE 30. YOU’RE 30. >> PEOPLE ALWAYS THINK THEY HAVE >> PEOPLE ALWAYS THINK THEY HAVE TIME, TIME IS THE MOST IMPORTANT TIME, TIME IS THE MOST IMPORTANT INGREDIENT IN YOUR RETIREMENT INGREDIENT IN YOUR RETIREMENT RECIPE.

RECIPE. LET’S JUST SAY YOU HAVE 40 LET’S JUST SAY YOU HAVE 40 YEARS. YEARS. YOU’RE YOUNG. YOU’RE YOUNG. YOU HAVE 40 YEARS UNTIL YOU’RE YOU HAVE 40 YEARS UNTIL YOU’RE GOING TO BE 70. GOING TO BE 70. YOU PUT $200 A MONTH AWAY INTO A YOU PUT $200 A MONTH AWAY INTO A ROTH IRA OR ROTH 401(k). ROTH IRA OR ROTH 401(k). AVERAGE MARKET RETURNS, DO YOU AVERAGE MARKET RETURNS, DO YOU KNOW THAT YOU WOULD HAVE KNOW THAT YOU WOULD HAVE $1.1 MILLION AT 70, WHICH I $1.1 MILLION AT 70, WHICH I THINK SHOULD BE THE NEW THINK SHOULD BE THE NEW RETIREMENT AGE, BUT YOU WAIT TEN RETIREMENT AGE, BUT YOU WAIT TEN YEARS. YEARS. >> YOU’RE TALKING ABOUT HAVING A >> YOU’RE TALKING ABOUT HAVING A SURPLUS OF 200 BUCK WHEN IS SURPLUS OF 200 BUCK WHEN IS YOU’RE 30. YOU’RE 30. SHOULD YOU TAKE THAT 200 AND SHOULD YOU TAKE THAT 200 AND APPLY IT TO ONE OF THESE OTHER APPLY IT TO ONE OF THESE OTHER THINGS.

THINGS. >> YOU NEED TO BE SAVING >> YOU NEED TO BE SAVING ESPECIALLY IN A 401(k), ESPECIALLY IN A 401(k), ESPECIALLY IF THEY MATCH YOUR ESPECIALLY IF THEY MATCH YOUR CONTRIBUTION. CONTRIBUTION. YOU PUT IN A DOLLAR, THEY GIVE YOU PUT IN A DOLLAR, THEY GIVE YOU $0.50. YOU $0.50. I DON’T CARE IF YOU HAVE ANY I DON’T CARE IF YOU HAVE ANY MONEY. MONEY. YOU CAN’T PASS UP FREE MONEY. YOU CAN’T PASS UP FREE MONEY.

IF YOU STARTED PUTTING, JUST IF YOU STARTED PUTTING, JUST LET’S SAY $200 A MONTH AWAY, AND LET’S SAY $200 A MONTH AWAY, AND YOU NOW ONLY HAVE 30 YEARS LEFT YOU NOW ONLY HAVE 30 YEARS LEFT VERSUS 40, YOU’D ONLY HAVE LIKE VERSUS 40, YOU’D ONLY HAVE LIKE $400,000. $400,000. YOU JUST BLEW $700,000 BECAUSE YOU JUST BLEW $700,000 BECAUSE YOU WAITED TEN YEARS. YOU WAITED TEN YEARS. IT WAS ONLY A $24,000 DIFFERENCE IT WAS ONLY A $24,000 DIFFERENCE IN THOSE TEN YEARS. IN THOSE TEN YEARS. BUT THE TEN YEARS, THE SOONER BUT THE TEN YEARS, THE SOONER YOU BEGIN, THE BETTER YOU’LL BE. YOU BEGIN, THE BETTER YOU’LL BE. >> JUST TO CARSON’S POINT. >> JUST TO CARSON’S POINT. IF I HAVE 200 BUCKS TO SPARE,KY IF I HAVE 200 BUCKS TO SPARE,KY CAN EITHER PAY OFF MY CREDIT CAN EITHER PAY OFF MY CREDIT CARD DEBT AND START SAVING IN A CARD DEBT AND START SAVING IN A ROTH IRA, WHAT WOULD MY CHOICE ROTH IRA, WHAT WOULD MY CHOICE BE? BE? >> YOUR CHOICE THERE IS TO PAY >> YOUR CHOICE THERE IS TO PAY OFF YOUR CREDIT CARD DEBT.

OFF YOUR CREDIT CARD DEBT. >> IF YOU DON’T HAVE MUCH MONEY >> IF YOU DON’T HAVE MUCH MONEY YOU MAY BE BEHIND ON YOUR CREDIT YOU MAY BE BEHIND ON YOUR CREDIT CARD PAYMENTS, AND YOUR INTEREST CARD PAYMENTS, AND YOUR INTEREST RATES ARE 15, 18%. RATES ARE 15, 18%. THAT’S A GUARANTEED RETURN. THAT’S A GUARANTEED RETURN. WHEN YOU PAY OFF YOUR CREDIT WHEN YOU PAY OFF YOUR CREDIT CARD DEBT, YOU’RE GUARANTEEING A CARD DEBT, YOU’RE GUARANTEEING A FANTASTIC RETURN. FANTASTIC RETURN. >> WHAT IS THE ONE SMALL THING >> WHAT IS THE ONE SMALL THING YOU WOULD TELL OUR VIEWERS YOU WOULD TELL OUR VIEWERS BEFORE WE GO? BEFORE WE GO? >> HERE’S WHAT’S REALLY >> HERE’S WHAT’S REALLY IMPORTANT. IMPORTANT. MANY PEOPLE HAVE ADVICE FOR ALL MANY PEOPLE HAVE ADVICE FOR ALL OF YOU. OF YOU. SOMETIMES THAT ADVICE IS GOOD SOMETIMES THAT ADVICE IS GOOD FOR THE PERSON GIVING THE FOR THE PERSON GIVING THE ADVICE, AND SOMETIMES IT’S GOOD ADVICE, AND SOMETIMES IT’S GOOD FOR THE PERSON RECEIVING IT.

FOR THE PERSON RECEIVING IT. MY ADVICE IS THIS, PLEASE DON’T MY ADVICE IS THIS, PLEASE DON’T DO ANYTHING THAT YOU DON’T DO ANYTHING THAT YOU DON’T UNDERSTAND. UNDERSTAND. IT IS BETTER TO DO NOTHING THAN IT IS BETTER TO DO NOTHING THAN TO DO SOMETHING YOU DO NOT TO DO SOMETHING YOU DO NOT UNDERSTAND BECAUSE SOMETIMES YOU UNDERSTAND BECAUSE SOMETIMES YOU CAN DO SOMETHING AND IT BLOWS CAN DO SOMETHING AND IT BLOWS ALL YOUR MONEY, AND SO IF IT ALL YOUR MONEY, AND SO IF IT DOESN’T FEEL RIGHT TO YOU, YOU DOESN’T FEEL RIGHT TO YOU, YOU HAVE TO TRUST YOURSELF MORE THAN HAVE TO TRUST YOURSELF MORE THAN YOU TRUST OTHERS. YOU TRUST OTHERS. IT’S YOUR MONEY, AND WHAT IT’S YOUR MONEY, AND WHAT HAPPENS TO YOUR MONEY IS GOING HAPPENS TO YOUR MONEY IS GOING TO DIRECTLY AFFECT THE QUALITY TO DIRECTLY AFFECT THE QUALITY OF YOUR LIFE, NOT MY LIFE.

OF YOUR LIFE, NOT MY LIFE. NOT ANYBODY ELSE’S LIFE, SO IF NOT ANYBODY ELSE’S LIFE, SO IF YOU REALLY WANT TO BE POWERFUL YOU REALLY WANT TO BE POWERFUL IN LIFE, YOU HAVE TO BE POWERFUL IN LIFE, YOU HAVE TO BE POWERFUL OVER YOUR OWN MONEY. OVER YOUR OWN MONEY. >> THAT’S GOOD ADVICE. >> THAT’S GOOD ADVICE. IN SOME CASES FINANCIALLY DOING IN SOME CASES FINANCIALLY DOING NOTHING IS BETTER THAN MAKING A NOTHING IS BETTER THAN MAKING A CHOICE TO YOUR DETRIMENT. CHOICE TO YOUR DETRIMENT. >> NEVER TALK YOURSELF INTO >> NEVER TALK YOURSELF INTO TRUSTING ANYONE. TRUSTING ANYONE. YOU WALK INTO A FINANCIAL YOU WALK INTO A FINANCIAL ADVISER’S OFFICE AND THEY FEEL ADVISER’S OFFICE AND THEY FEEL LIKE THEY KNOW WHAT YOU’RE LIKE THEY KNOW WHAT YOU’RE DOING. DOING. THEY MUST KNOW, YOU DON’T KNOW THEY MUST KNOW, YOU DON’T KNOW AND YOU BELIEVE THEM. AND YOU BELIEVE THEM. SOMETIMES THEY GIVE GREAT AED SOMETIMES THEY GIVE GREAT AED VICE AND SOMETIMES THEY GIVE VICE AND SOMETIMES THEY GIVE ADVICE THAT’S NOT SO MUCH.

ADVICE THAT’S NOT SO MUCH. >> THAT STUFF’S TRUE IN >> THAT STUFF’S TRUE IN ANYTHING, RIGHT? ANYTHING, RIGHT? >> WHEN YOU THINK ABOUT IT, >> WHEN YOU THINK ABOUT IT, SAVANNAH, YOUR MONEY AND YOUR SAVANNAH, YOUR MONEY AND YOUR LIFE ARE ONE. LIFE ARE ONE. WHO YOU ARE AND WHAT YOU HAVE IS WHO YOU ARE AND WHAT YOU HAVE IS ONE. ONE. IT’S YOU’RE THE ONE WHO EARNS IT’S YOU’RE THE ONE WHO EARNS IT.

IT. YOU’RE THE ONE WHO INVESTS IT. YOU’RE THE ONE WHO INVESTS IT. YOU’RE THE ONE WHO SAVES IT, AND YOU’RE THE ONE WHO SAVES IT, AND YOU’RE THE ONE WHO’S GOING TO YOU’RE THE ONE WHO’S GOING TO LIVE. LIVE. >> WE’LL JUST GO TO YOU. >> WE’LL JUST GO TO YOU. YOU’RE OUR TRUSTED SOURCE. YOU’RE OUR TRUSTED SOURCE. >> COME ON, EVERYBODY, COME JOIN.

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How 2024’s Record Retirement Numbers Could Spark a Recession | WSJ

– [Narrator] You're looking at
a chart of the US population, and these are the baby boomers. This year, a record number of them will reach
traditional retirement age. By 2030, they'll all be 65 or older. This is creating a fiscal problem because fewer taxable
workers means less money for social security. – If Congress does nothing,
we're gonna hit a major crisis.

– [Narrator] Here's how
this demographic shift threatens the future of one of the country's most
important government programs and what can be done to fix it. Baby boomers or those born between 1946 and 1964 have been propping
up the US economy for decades. – Their mere numbers
contributed for a long time to rapid economic growth and because every worker
contributed social security that made social security
look very healthy. – [Narrator] But as boomers
started exiting the workforce in 2008, the number of
retirees grew rapidly. – Not only do you have more
retirees collecting benefits for more years, you
have fewer young people entering the workforce
because birth rates were lower for their parents' generation, and that creates a squeeze
on both directions.

Higher expenses from all
those retirees living longer, lower payroll tax revenue from fewer people entering the labor force because of those declining birth rates. – [Narrator] This puts a lot
of pressure on social security and without policy change, projections show the trust
funds will be depleted in 2034. – There's a misconception out there that when the social security
trust fund is exhausted, the system is somehow
bankrupt and there's no money. Social security is an integral part of the federal government, and as long as the federal
government is not bankrupt, social security is not bankrupt. – What's really happening is
the program is running out of treasury bonds, which are basically IOUs
from the government. For many years, social security
was taking in more money than it needed to pay out in
benefits, so it lent money to the government to
use for other programs, and it got IOUs in return. – Around 10 years ago though,
that situation flipped around.

For the last decade, we've been
paying out more in benefits than we've been collecting
in social security revenue. – [Narrator] But because the program had so many IOUs stashed
away from previous years, it's been able to keep
paying benefits in full by cashing in on those IOUs. – Right now, there's
roughly $3 trillion in IOUs, but each year that $3 trillion stash gets a little bit smaller. By the year 2034, all of the
IOUs will have been cashed in. – That means retirees would see overnight about a 25% benefit cut. – [Narrator] This number will
likely increase as the number of workers per retiree continues to fall. – Simply because we're not about to go bankrupt doesn't
mean there's no problem.

There very much is a problem. – [Narrator] Studies
show that the majority of Americans rely on these
monthly benefits checks for retirement income. According to census bureau
data, about 50% of people between 55 and 66 years old
have no retirement savings. – Can you imagine right now if you had to take a 25% reduction
in your take home pay, you still have to pay rent. You gotta buy groceries,
you gotta pay utilities. – It's especially important for those who don't have college degrees, people on the lower end
of the income spectrum. – [Narrator] Fichtner says, when retirees have less retirement income, they also generally spend less money. – That means less economic activity. That means less employment because employers have to lay off people 'cause no longer is that money coming in. It's a ripple effect that could be basically a
senior induced recession. – But social security is only
meant to replace a percentage of a worker's pre-retirement income based on lifetime earnings. So as much as 78% for very
low earners to about 42% for medium earners and
28% for maximum earners. – This is three legged stool
we talk about all the time.

It's supposed to be social
security is one leg, your employer provided pension is a second leg and your
personal savings a third. Well, social security
is financial challenges. We don't have pensions really anymore. About 10% of the population has pensions and then it's hard to save on your own when you've gotta pay off student loans and housing costs are so high. – [Narrator] About half of Americans do have retirement accounts
like 401Ks and IRAs, but those are all subject to market risk. – I hear a lot, well,
those are 65 year olds.

Why do I have to worry
about the boomers today? Well, this impacts every
generation that's coming up behind. – They might not be asked to pay a slightly higher payroll tax. More important, they might be asked to work a little bit longer. – [Narrator] And like most
things in the economy, social security's funding
shortfall isn't an isolated issue. – It's one of the reasons
the federal budget deficits is as large as it is. It means that we have to borrow money, which means issuing bonds. That tends to put up
pressure on interest rates, which means it's harder to afford a house. It means that Congress might have to cut spending on other
programs like the military or the environment in order to make sure that there's enough money
for social security. – [Narrator] So what needs to
happen to put social security on more sound footing? Congress needs to pass a law. – Congress has stood still and not enhanced social
security since Richard Nixon.

– [Narrator] When and what kind of law, that we still don't know. There's been a number of proposed
solutions over the years. – This legislation demands that the wealthiest people in this country start paying their fair share of taxes, – But policymakers generally
disagree on whether to raise taxes or cut benefits. – You'll have two approaches
to how to solve this problem, and you're not gonna do it. – There's probably no single magic bullet, which will put social security
on a long-term footing. Instead, Congress is
probably going to have to look at a variety of steps which will collectively fix the problem.

– [Narrator] But economists
don't expect action to be taken anytime soon. – Everybody, including on Capitol Hill, knows that social security has a problem. Nobody, especially those in Capitol Hill, are prepared to do anything about it. – As we all apparently
agree, social security and Medicare is off the books now, right? They're not to be smart.
(clapping and cheering) – We all would wish that
politicians would show the political courage
necessary to tackle this now and not wait until the 11th hour. Benefits and changes to retirement programs
take a while to phase in. One of the last major reforms we had for social security were the 1983 reforms. – [Narrator] Those amendments
raised the retirement age to 67, but it took nearly
40 years to phase them in.

– There is a 10 year window, but we don't have 10 years to act. – There has to be some kind
of a legislative solution that comes along between now and then. By law, the program can't
borrow anywhere else. The program's too important,
too popular for it to basically be allowed
to run out of money..

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2 Retirement Tax Planning Strategies To Save THOUSANDS In Your Retirement Portfolio!

how would you like to save hundreds of thousands of dollars potentially in taxes in retirement well these two strategies I'm going to go through today when combined together have the potential to do just that now if you don't qualify for net unrealized appreciation because you don't have company stock inside your 401k you can still qualify for zero percent taxes on your long-term capital gains and dividends so when we combine these strategies together it creates a very powerful tax and income planning tool that you can use for your retirement [Music] foreign as you can tell I'm pretty excited about this video because we're going to discuss two tax planning strategies the net unrealized appreciation which I've not yet done a video on the YouTube channel about and also the zero percent taxation for long-term capital gains and dividends and you're going to want to stick around until the end of the video where I incorporate these two strategies into a real life financial planning case now unless you've searched net unrealized appreciation to find this video there's a pretty good chance you've never heard of net unrealized appreciation so in its most basic form it's when you have company stock that's been issued inside your 401k you have the option of rolling that money outside of your 401k not into an IRA but rolling it out only paying income tax on the basis that's been distributed and potentially pay long-term capital gains tax on the appreciation so that appreciation from where it was issued to where it is whenever you roll it out and retire or sever from service or become 59 and a half that's what's called your net unrealized appreciation we're here in Houston Texas where we have a lot of client clients that worked at Exxon Mobil or Chevron or some of the other big oil and gas companies we also have clients from all over the country that work for other companies that can take advantage of this net unrealized depreciation strategy so I'm going to use Exxon because we come across this plan a lot we're very familiar with the Exxon retirement plan and I want to illustrate how this concept works and there's some nuances here and there's also some financial planning considerations and of course tax ramifications that we're going to go through but if I worked at Exxon let's say from 1995 to 2020 and as part of my compensation I receive shares of stock each year over the course of my employment so these numbers are not historically accurate but I want to convey the the principle here so in the beginning years if Exxon was trading at twenty dollars and I received a hundred shares and then next year maybe I received them at 22 dollars per share and twenty five dollars per share and over time as I've received more shares as part of my compensation package the value has typically increases the price at which you were issued those shares in the year you received them is what's called your cost basis so if we do this Nua rollout that's the amount that you'll have to pay income taxes on but it's a really cool opportunity here because over time most stocks appreciate in value Exxon today is at a hundred and sixteen dollars per share so the concept of Nua is if I was issued stock at twenty dollars a share and I keep it in the IRA and now it's at 116 dollars a share that's a massive amount of capital appreciation and if I roll it to an IRA and distribute it at that point or at some point in the future I'm going to income taxes and that can can lead to a pretty big tax liability now we're down the road when I need income but if stocks appreciate it over time we typically have a mixed cost basis when it comes to the amount of shares that we've received from the company so first thing to know here and first thing to ask your company is do you guys provide a breakdown of the cost basis on an annual reporting period or do you take the average cost basis so we come across some companies here that they will provide you the information of the exact cost basis and the amount of shares that you've received in each year in that case we can really cherry pick which shares we want to roll out and really take advantage of this strategy because typically we're going to take the lower cost basis ones some companies don't allow you to cherry pick based on the lower basis shares that were issued they calculate an average cost basis for all the shares issued so this is not nearly as advantageous as being able to cherry pick sometimes it can still make sense especially if it's an older 401k or if it's a stock that has really really appreciated since those shares were issued in the average cost basis is down so this video my primary purpose is to help educate you around the financial planning considerations of the Nua rollout so I'm not going to cover all the rules and reg surrounding it I'll do that in a later video though but a couple things you should know this becomes an opportunity whenever you sever from service or typically when you're entering retirement there are some other qualifications but we'll cover those later now if you sever from service prior to age 55 you will be subject to a 10 penalty on the amount you distribute so just be aware that if you're under the age of 55 you've severed from service you have company stock inside your 401k that that 10 penalty for early distribution still applies we have Exxon this 401K here so the total value is about 1.5 million in this hypothetical example the shares the tote in totality the shares have been issued over the course of the working career equals about a six hundred thousand dollar cost basis so I'm going to use the example here where we can cherry pick the individual shares so the next question becomes which shares should I consider doing the Nua rollout because I don't have to roll all six hundred thousand basis out in the real world typically this 1.5 million of fair market value may also be comprised of mutual funds such as growth funds income Etc within the 401K for the purpose of this example Exxon stock is valued at 1.5 million dollars the cost basis of those Exxon shares within the 401K is 600 000.

Just want to point out in the real world typically everyone does not have all their money invested in their company stock but I've I've absolutely seen that over the years so the question becomes which shares do we want to take advantage of the annual rollout with the general rule of thumb is the lower cost basis Shares are more attractive and that's determined by the the value of the stock today anything above 50 percent cost basis to fair market value typically we don't want to consider for Nua now there are some extenuating circumstances sometimes with financial planning considerations that it may make sense but when we do the math and we extrapolate out looking at the value that you would have in the ira versus paying taxes on the basis now annual taxation for growth dividends Etc the Breakeven point isn't that attractive when we look at these shares that are above 50 percent cost basis to fair market value I personally like to see them around 20 or 30 percent really tops so whenever you have shares that are 10 15 20 25 cost basis to fair market value those are typically very attractive opportunities and in some situations Thirty thirty five forty percent could possibly make sense it just depends on the overall financial plan that you're putting together in other circumstances so this is a tax analysis so you may want to reach out to your CPA for help or assistance in doing this or your financial advisor if they're qualified and skilled enough to help you make these determinations I want to run through some numbers now so let's assume for whatever reason this person decides to do the whole Nua rollout so just so we understand the how this functionally works the 600 000 rolls out of the 401K into a non-ira account income tax is due on that six hundred thousand dollars you're probably looking at about a 27 28 maybe 30 percent effective tax rate we'll go with 30.

So 100 eighty thousand dollars of income taxes would be due on the basis being rolled out but in this scenario you're not just rolling out 600 000 That's the basis you're actually rolling 1.5 million dollars out of the 401K and only paying income tax on the basis now if you sell it immediately the net unrealized appreciation is the difference between the basis and the fair market value so you have nine hundred thousand dollars of gain there so if you sell that nine hundred thousand you're looking at the more preferential long-term capital gains tax that would be a pretty big tax still so the question becomes the are what planning considerations should we hold on to this stock do we feel comfortable having this much in one company what is our other wealth what if we break it out over a few years so this is what we're really going to dive into now I just want you to understand how this actually works in regards to the functionality okay let's cover how this actually works so we take the Exxon stock the basis is 600 000 but the full value is 1.5 million so if in this example we decide we want to do it all we would roll the full 1.5 million out of the 401K it will go into a non-ira account but you only owe income taxes on the basis the 600 000.

If you sell the stock immediately you will owe long-term capital gains tax which is a more preferential rate than income taxes at this level of income on the difference between the basis and the fair market value or nine hundred thousand there but you don't have to sell it right away if you don't sell it right away and then you sell it six months later you'll be subject to short-term capital gains tax because you're holding period rules take take into a place or taken to effect if you don't sell it immediately but if you wait 12 months after the distribution date 12 months in one day then you qualify for long-term capital gains tax treatment so some of the financial planning considerations are now what are the income taxes due what is my income and tax plan year one year two year three of retirement how does this fit into that overall tax and income plan and how do we optimize how do we reduce the total taxes we pay while maximizing the value that we retain if we have to pay income taxes on six hundred thousand dollars you're looking at an effective tax rate there of about 27 28 maybe 30 percent so 30 on 600 is a hundred and eighty Grand so you'd write that check to Uncle Sam and you would have 1.5 million outside of the 401K in the more preferential tax environment of long-term capital gains and dividends now you would have annual taxation on these dividends so that's something else we need to consider and we also need to consider future tax rates and make assumptions with what do we think income tax rates are going to be in the future long-term capital gains and dividend rates all of these things go into the analysis but for now this is the logistics of how it works we roll it all out pay income taxes on the basis we can either sell it immediately and pay long-term capital gains on the differential or we can hold it and if we hold it past the distribution date sell it within 12 months short-term capital gains sell it post 12 months long-term capital gains okay so I want to dive deeper into the two options we have just high level so option A is We Roll everything to the IRA we do not take advantage of the Nua rollout eligibility things that we have to consider here is future tax rates rmds other income sources and the secure act now this is not an exhaustive list this is just some of the big ones we have to take and consider future tax rates because when everything is inside that tax infested Ira when you distribute it in the future you have to pay income taxes you've given up the ability to take advantage of long-term capital gains and dividend taxes which are typically a preferential rate rmds Force distributions from your retirement account and when added with other income we oftentimes see people who did not plan for this have 150 200 250 even more of income because of required minimum distributions and their other income so when doing this analysis we have to extrapolate out and look at these factors to help make the decision today secure act I threw this in here because it forces distribution of your retirement accounts if they go to a non-spouse beneficiary that's more than 10 years younger than you full distribution of the retirement account within 10 years so if you have kids and it's important to leave this money to your children if they have income and they're working and now your retirement account has to be fully distributed within 10 years that could be a massive amount of income going on top of their income which now 30 40 50 60 potentially of your retirement account has gone to Uncle Sam if you live in a state with income taxes that could be an issue as well inheritance taxes so a lot of issues here rolling everything into the IRA you can be hit with um pretty big income taxes down the road option b is we do take advantage of the Nua rollout either wholly or in a partial Nua rollout how that works is we would take the shares that we do decide to take advantage of this strategy and we roll them into the non-ira account some things to consider there is that what are long-term capital gain rates now what are they possibly going to be in the future but also we have annual taxation of the dividends and if we're buying and selling inside that account whatever we do not roll into the non-ira account with the strategy the rest of the funds from your 401k go into the IRA and then of course whatever's left here we have the same considerations that I went through over here so now there are financial planning considerations here let's say I was at 35 cost basis to fair market value so I'm kind of right there where mathematically it may not make sense but how much non-qualified money do I have how much essentially I'm saying how much do you have outside of your retirement accounts because if you're entering retirement and all that money is inside that tax infested 401K then you don't have any ability to manipulate what goes on your 1040 your tax return by manipulate I mean we determine which accounts were withdrawing income from to manage our taxable income that we report to the IRS if we pull from our non-qualified accounts think your bank account well you don't have to report that so if you need a hundred thousand a year we pull 50 from your bank and 50 from your IRA you get your 100 000 but only fifty thousand goes on the tax return that's how we can manipulate that so how much non-qualified money do you have if you don't have much we may want to consider doing a little bit higher Nua rollout because even mathematically it may not make sense when we just compare that decision in isolation to do or not to do the Nua rollout but when we now look at the other benefits that we're receiving such as the ability to do Roth conversions the ability to manipulate what goes on our 1040 the ability to possibly qualify for a health care subsidy if you retire before the age of 65 by managing the reportable or taxable income that's reportable we can qualify for a subsidy so this is why we're so big on financial planning because as you can see it's not just about Investment Management in retirement that's important absolutely but when we tie in financial planning with Investment Management we can create some really optimal scenarios where we're creating a ton of value and helping you have more income pay less tax and ultimately have more value throughout the course of your retirement okay this is the part that I mentioned in the beginning of the video where we're going to tie into kind of a real world plan planning case so we laid the groundwork for what Nua is and some of the considerations that you have to make in order to determine if it makes sense for you to do the Nua rollout so what I want to point out here is the tax and income plan for retirement years one two and three for someone who takes advantage of the Nua rollout because the question becomes when do we sell that stock if we have 30 40 50 percent of our entire net worth in our company stock it's pretty risky to hold on to that position just so we don't pay more in taxes so here's where we're going to tie the financial planning considerations of the real world application and decisions we have to make on the Nua rollout with years one two and three of someone just entering retirement one of the big risks is if we roll it out the company's stock and we decide not to sell it because we don't want to pay the long-term capital gains immediately if we hold on to that that concentrated Equity position we have increased our risk now there are investment strategies that can be used such as buying a put option or what we call an Equity caller but I want to just talk about the tax and income plan here so in this scenario client rolls out the annual way so they have a large concentrated Equity position and they've paid income tax on the basis but do not want to sell the company stock yet so as part of the tax and income plan what I want to show you is we could break this up so year two year three and even year four possibly depending on the size of the concentrated Equity position Company stock where zero percent taxes essentially so we have total income here of a hundred and twenty thousand so what this is the tax and income strategy where we're generating income year two of retirement not year one because in year one you've done the the Nua rollout you have a big tax liability from paying income taxes on the cost basis of that company stock so here's your two so year two the the tax and income strategy is don't take anything out of the 401K no Roth conversions we're going to sell the company stock that we previously rolled out take advantage of Nua and we can have a hundred and twenty thousand dollars of income here as long as it's all capital gains and dividends your total tax liability 458 dollars now what I've done here is assumed twenty thousand dollars of dividends because if you have company stock and you roll it out it probably paid some dividends so 20K there and a hundred thousand of long-term capital gains we're realizing we're recognizing so this is darn near zero percent on a hundred and twenty thousand dollars of retirement income and we're divesting from that company stock now again some risk management strategies we could have an equity caller or put option helping to support downside volatility of that concentrated position but just taxing in complaining wise I want to show you how how this can work out so here now I've added 125 000 of long-term capital gains with twenty thousand dollars of dividends total AGI 145 000 the total tax 4208 on 145k of income 2.9 percent so again we've divested so maybe this is year two of retirement or year three we've divested from the company stock we've reduced our risk we've provided the income that we needed for retirement and we've done so in a way that's tax advantaged same thing goes on now I wanted to point this one out because I've here I've thrown in the same 20 000 of dividends 125 000 of long-term capital gains so we're selling the stock again but now we also take advantage of a twenty thousand dollar Ira distribution so this is which accounts do we pull income from in retirement how do we generate income what's the tax plan total AGI comes up to 165 the total tax is 7208 but here's the cool part the IRS ordering rules for how you pay tax on income based on where that income is generated the distribution from the IRA is actually tax-free but what happens is when you take money out of the IRA it brings some of those long-term capital gains into taxation so I did a video not too long ago where we talked about adjustments and Social Security and IRA distributions and wealth conversion taxes the tax code is filled with these where if we we take one more dollar of income it brings one other item into now a taxable State such as Social Security or long-term capital gains or dividends so just just be aware of that I guess 165 000 of income seven thousand two hundred and eight dollars in income taxes representing a four point four percent tax rate so now one two three four years into retirement we've divested the uh concentrated stock risk we provided income and a very tax advantaged manner we still have that Ira with a lot of money in it to deal with but once this is done we would probably at that point start down the Roth conversion path now every situation is different but hopefully these topics and ideas and and considerations when it comes to risk management income planning tax planning and retirement will help you have a better retirement if you want to learn in more detail how to potentially pay zero percent in long-term capital gains and on your dividends click this video right here I did a couple years ago where we do a deeper dive into the special tax advantage [Music] thank you

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Retirement Planning for Singles

Retirement is a big deal for anybody, and that's especially true for single people who may be retiring with just one income and who may have built up a nest egg solely off their own savings. So, we know that single people can and do retire comfortably. In fact, one quarter of people over age 60 are living alone in their household, and that number is slightly higher for women, and that's, of course, due to women's longevity. So what we're going to talk about here is retirement for single people. First, we'll go over some averages to give you a rough idea of what the landscape looks like for single people, then we'll get into how much money you might need as you go into retirement, then we'll talk about some tips that can help improve the chances of retiring comfortably. Let's start with the average retirement income for single people. So it's $42,000 on average for an individual in retirement, and that comes from the US Census Bureau. The median is a little bit lower at $27,000.

So a friendly reminder of how this works: The median is the middle, so if you line up all of the survey results, people telling you what their income is, for example, that arrow points at the middle observation, which would give us the median down at the bottom. But if we go to the average, that is going to get skewed by, in this case, wealthy people, for example, they have a very high income. When it comes to Social Security, the average is about $1,500 a month or $18,000 per year.Your level depends, of course on your earnings, if you had higher earnings during your working years, then you tend to potentially have a bigger benefit than that, and it could be lower, and then of course, your claiming age is also an important thing. If you claim early at age 62, you get a reduced benefit. That's likely to bring down the amount you get.

Next, we have pensions, some people get an income from a job they worked at. That might be in the public sector as a teacher, a firefighter, that sort of thing, or even in the private sector, you could have a pension from your job, and those incomes just are all over the board, it could be high, it could be low, but these are different sources of income that people might have in retirement. This is just a friendly reminder that this is just one video and it may cover some interesting information, but it's not specific to you so I hope you'll do a lot more research, hopefully check with some professionals and get some individualized advice, and that way you can improve the chances of things going well for you.

So now let's talk about how much you might need as you go into retirement. Unfortunately, there's no single answer on what you need because it depends. So the first step is to figure out what sort of income you're going to need, and I've got other videos on that, I'll put links in the description to get you some more information, but you can look at replacing a portion of your income, or you can just say, I want X amount of dollars per year, or you can go with other approaches, but first we need to know how much income you are hoping for. Next, we tally up your income sources, so that might be some guaranteed income that comes in from Social Security, for example, or from your pension at your workplace, but that forms a base of income and that might or might not cover what you need. But it gives us a base and then if we need to fill that in, we can supplement withdrawals from your retirement savings, so that might be out of your IRA, your 401, 403, these accounts that you have built up over time can provide supplemental income to help fill the gap between that guaranteed income you get and the amount you actually want to spend.

There are a number of ways to figure out how much to withdraw and to set up different strategies, there might be bucking strategies, there might be withdrawal strategies like the 4% rule. Or if you don't like that, make it the 3% rule to be safer, or take out more if you think that's not enough and you're selling yourself short. Ultimately, there are a number of ways to approach this, so you just pick one that works well for you, and again, I can point you to some resources on figuring that out. And finally, you will want to look at taxes and inflation, so during your retirement years, it's reasonable to assume that prices may increase on many of the things you buy, so we want your income to be able to increase as well, Social Security typically does rise, but maybe not at the same rate as the things you're buying, so your withdrawals may need to account for that.

Plus we've got taxes. You typically will owe taxes if you're taking distributions or you're taking withdrawals from pre tax retirement accounts. If you have a pension that might be taxable as well. We just want to look at all of these things and figure out what your ultimate money left over to spend each month is going to be. For an over simplified example, let's just look at Jane Doe.

She's 60 years old, she's single, she wants to retire in about five years, she makes about 80,000 a year and has 700,000. A lot of people retire with less than that, a lot of people retire with more. I'm going to bring up my financial planning software that I use with clients, and we'll just go over kind of why there's no single answer on how much you need. Now, if you can tell me exactly how long you'll live and what the markets will do and what inflation will look like, we can tell you exactly what you'll need. But there are a lot of unknowns, so a lot of times we start with a probability of success and I'll go over what that means, and then we look at little tweaks and how different changes might affect that probability of success, so working an extra year might bring her from…

Let's say 75% to 84% likely to succeed. Now, success and failure are pretty complicated. They don't necessarily mean that you go completely broke, but you may need to make some adjustments, so let's talk about what does the success mean? We, again, cannot predict the future, so we say, Let's look back and say, You get dealt 1,000 hands. You're playing a game of cards and you get 1,000 hands. Some of those are good and some of those are bad, so the very good ones tend to be up here, near the top. And you actually end up with a lot of money left over. Some of them are not as good and you end up running out of money early. The median is, again, that one that's right in the middle when we line them up in order for best to worst.

And so you might say, you're probably not going to get the best, you're probably not going to get the worst, although anything is possible. So that's how we go with this likelihood of success. Now, maybe she doesn't want to work an extra year, so we can look at different ways of accomplishing things here. By the way, we've built in some long term care in case she does get sick and needs that at the end of life. She's looking to spend about 4,000 a month, that's after some health care costs that are going to inflate each year, and she's saving a decent amount in some 401K and taxable accounts. Let's say she goes ahead and maxes out that Roth, is it going to make a big difference? Not really, 'cause she only has five years left. So what we do here is we start looking at all of these different variables and playing with the pieces and figuring out what does it take to make her successful at her retirement, or at least successful enough that she's comfortable making that transition.

So here are some tips to improve your chances. The first is to plan for long term care. If you're living on your own, you don't have somebody in the house who can help you do things, and it's arguable if even a couple is capable of managing this on their own… I mean, if you think about a couple, is one of the people physically able to move the other person around and do they have the skills to provide health care, and the time and the energy, frankly, to provide all that type of care? So it's important for everybody, but it's especially important for single people to plan for this care. So you can look at getting insurance, you can look at budgeting for some costs, like we showed you in the software, you might want to budget for a much bigger number if you go into memory care or something like that with 24 hour supervision, it can get really expensive quickly.

And you can explore different living arrangements, maybe doing things with friends or certain communities that might be a good fit for you. Next is to avoid leaving money on the table so if you were previously married and your spouse passed away or you've been divorced, you may be eligible for benefits. That's maybe from Social Security, you can potentially get a survivor's benefit, or if you were married for at least 10 years and you've been divorced, you can potentially get spousal benefits on your ex spouse's work record. It's just important to explore all of these to see if there are any resources available for you.

Next is to make a plan, and I am of course biased as a financial planner, but I think it is really helpful to go through the process, and the main goal isn't to get a big document that tells you what your financial plan is. Instead, really, the benefit is going through that process and learning a lot about your finances as you do it, and in that process, you get an idea of what the risks are, how you're doing, you might get confidence and clarity on whether or not you can go ahead and retire, if you should do certain things or not. It's just a very valuable process for a lot of people, but I'll leave that for you to decide. If you found this video helpful, please leave a quick thumbs up. That gives me feedback that this is something you might enjoy more of, so thanks for watching and take care..

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Why This Investment System Can Help Retirees Worry Less About Their Retirement Plan

I want to share an investment system for retirees to hopefully assist you as you're thinking about and planning for your retirement we're also going to look at how to prepare your retirement for the multiple potential potential economic Seasons that we may be headed into so we want to look at the multiple seasons and then the Easy System that's going to help lower taxes and then lower risk as well now if I haven't met you yet I'm Dave zoller and we help people plan for and Implement these retirement strategies really for a select number of people at streamline Financial that's our retirement planning firm but because we can't help everyone we want to share this with you as well so if you like retirement specific videos about one per week be sure to subscribe so in order to create a proper investment plan in system we want to make sure that we build out the retirement income plan first because without the income plan it's much harder to design the right investment strategy it's kind of like without the income plan it's like you're guessing at well 60 40 portfolio sounds good or you know May maybe this amount in the conservative bucket sounds reasonable you already know and and you feel that as you get close to retirement that goal of just more money isn't the the end-all goal that we should really be aiming for for retirement it's more about sustainability and certainty and then really the certainty of income and possibly less risk than before the last 30 years uh the things that you did to be successful with the financial side are going to look different than the next 20 or 30 years now if you need help defining the the income plan a little bit then look at the DIY retirement course below this video now once you do Define your goals for retirement and then the income needed to achieve those goals then creating the investment system becomes a lot easier and within the investment plan we really know that we can only control three things in all three things we actually want to minimize through this investment system the first thing we can minimize or reduce is how much tax you pay when investing we had a a client who was not a client of streamline Financial but of a tax firm coming to the the CPA firm in March to pick up his tax return and he was completely surprised that he had sixty thousand dollars of extra income on his tax return that he had to pay tax on right away before April 15th and it was due to the capital gains being recognized and other distributions within his investment account and he said but I didn't sell anything and the account didn't even go up that much last year and I got to pay tax on it but he was already in the highest tax bracket paying about close to 37 percent on short-term capital gains and dividends and interest so that was an unpleasant surprise and we see it happen more often than it should but this can really be avoided and here's two ways we can control tax so that we don't have to have that happen and really just control tax and pay less of it is the goal and I'll keep this at a high level but it'll get the the point across number one is the kinds of Investments that you own some are maybe funds or ETFs or individual uh equities or things like that the funds and ETFs they could pass on capital gains and and distributions to you each year without you even doing anything without you selling or or buying but it happens within the fund a lot of times now we would use funds and ETFs that are considered tax efficient so that our clients they can decide when to recognize gains rather than letting the fund company decide now the second way is by using a strategy that's called tlh each year there's many many fluctuations or big fluctuations that happen in an investment account and the strategy that we call tlh that allows our clients that's tax loss harvesting it allows them to sell an investment that may be down for part of the year and then move it into a very similar investment right away so that the investment strategy stays the same and they can actually take a write-off on that loss on their taxes that year now there's some rules around this again we're going high level but it offsets uh you know for that one client who are not a client but who had the big sixty thousand dollars of income he could have been offsetting those capital gains by doing tlh or tax loss harvesting that strategy has really saved hundreds and thousands of of dollars for clients over a period of years so on to the next thing that we can control in our investment plan and that's cost this one's easier but many advisors they don't do it because it ends up paying them less now since we're certified financial planner professionals we do follow the fiduciary standard and we're obligated to do what's best for our clients so tell me this if you had two Investments and they had the exact same strategy the same Returns the same risk and the same tax efficiency would you rather want the one that costs 0.05 percent per year or the one that costs 12 times more at point six percent well I know that answer is obvious and we'd go with a lower cost funds if it was all the same low-cost funds and ETFs that's how we can really help reduce the cost or that's how you can help reduce the cost in your investment plan because every basis point or part of a percentage that's saved in cost it's added to your return each year and this adds up to a lot over time now the last thing that we want to minimize and control is risk and we already talked about the flaws of investing solely based on on risk tolerance and when it comes to risk a lot of people think that term risk tolerance you know how much risk can we on a scale of one to ten where are we on the the risk factor but there's another way to look at risk in your investment strategy and like King Solomon we believe that there's a season for everything or like the if it was the bird song There's a season for everything and we also believe that there's four different seasons in investing and depending on what season we're in some Investments perform better than others and the Four Seasons are pull it up right now it's higher than expected inflation which we might be feeling but there's also a season that can be lower than expected or deflation and then there's higher than expected economic growth or lower than expected economic growth and the goal is reduce the risk in investing by making sure that we're prepared for each and every one of those potential Seasons because there are individual asset classes that tend to do well during each one of those seasons and we don't know nobody knows what's really going to happen you know people would would speculate and say oh it's going to be this or this or whatever might happen but we don't know for sure that's why we want to make sure we just have the asset classes in the right spots so that the income plan doesn't get impacted so the investment system combined with the income system clients don't have to worry about the movements in the market because they know they've got enough to weather any potential season I hope this has been helpful for you so far as you're thinking about your retirement if it was please subscribe or like this video so that hopefully other people can be helped as well and then I'll see you in the next one take care thank you

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