Things to consider in Retirement- Ask Alan
Things to consider in Retirement- Ask Alan
Alan Porter
 Oct 25 2023    22:10 PM
 
 

People often ask me about the stock market, well first off I don't give investment advice but I think everybody needs to have a diversified portfolio and it does not mean they're Diversified stock portfolio.

The market has always been unpredictable but unpredictable world events have made it even more unstable such things as a covid epidemic, unprecedented fiscal stimulus, Wars overseas and Rising inflation has made the idea of a stable Market unobtainable.

You can have great returns but you can also have great losses you you first need to ascertain your risk-

Are you conservative, moderate or willing to take risk? You also understand when you were young taking risks might suit you but when you retire you can't afford to take risks with your retirement. Do you want to have guaranteed income as part of your retirement or do you want to risk everything in the market?

You know I often tell people I'm not going to make you rich but I'm going to make sure that you never run out of money and that is the number one fear in retirement is running out of money before you run out of life!

Now understand this - I've had many people with many different ideas as I said before I want people to have a diversified portfolio but that also includes a stock portfolio, fixed and fixed indexed annuities and cash value life insurance. It is my opinion and the opinion of many educated advisors that cash value life insurance is the absolute best tax code approved tax-free retirement system available today, with many benefits a stock portfolio cannot provide.

People need to understand that it's not about ready to return to retirement it is about distribution of your assets and with certain Insurance products such as fixed and fixed indexed annuities the older you get the bigger the distribution rate is from these Financial vehicles and that money is guaranteed for life.

I show people how to have guaranteed income for life even if those assets run out of money. You can't do that with a stock portfolio.

Several things right now that are extremely important for your retirement and these include the benefits of cash value life insurance and fixed and fixed indexed annuities when properly structured-

#1 They can grow tax deferred and their distributions are tax-free and you do not have to have required minimum distribution-- this is absolutely huge!

They can eliminate many risk and retirement that a stock portfolio cannot provide such as:

Market risk sequence of returns risk which many many people have no idea about because they're financial advisors have not told them because advisors get paid a fee whether the client makes money or not!

As I said before the number one fear in retirement is running out of money before you run out of life!

This can be eliminated. More risk longevity risk which is a risk multiplier long-term care risk having money that is tax-free for pennies on the dollar. You know to pay for long-term care.

People need to understand seventy percent of all Americans are going to need long-term care at some point in their life and it costs between 50 to 200 000 a year and goes up every year and 40 percent of those people on long-term care are between the ages of 18 and 64. Now this was a huge government risk the Congressional budget office put put out last fall with a 31 trillion dollar deficit that if taxes aren't raised overall by 66 percent We can't even pay the interest on the outstanding debt & the country will default!

Well now our debt is over 32.9 trillion and it's not even a year later... but you also have protection from lawsuits liens and judgments it avoids probate and if you don't know what probate is: It is a lawsuit that you initiated that you were going to pay for and you're going to lose because what happens is that assets are seized by the government to pay the taxes on your estate and your beneficiaries are going to be less, unless they have proper planning - where we see probably less than 25 percent of your assets!

Now everybody remembers "Prince" the Entertainer had no Exit Plan & after he died his beneficiary is going to get less than 10 to 25 percent of that because the government has controlled HIS assets & it's in Probate! What's going to happen is they're going to sell all those assets to pay the taxes and what's really bad: Attorneys are going to get six to 12 percent of that estate!!

Now a stock portfolio absolutely does not give you a guarantee of any of these but it does give you a guarantee you're guaranteed to lose money when the market goes down and the fees that go along with that for your advisor because remember they are paid a fee whether you make money or not !

Again like I said, the stock portfolio could not guarantee you any of the above benefits that I just mentioned unless it is a Roth but then only a couple of benefits such as tax redistribution and no required minimum distribution.

People always tell me well I have a 401k... well, people need to understand the fees that are involved in the 401K a one percent fee over 30-year period will reduce your income by one-third and the average fee in a 401k is 2.99!

Across America people have less than half of their income when they go to retire and they have all the risk even the father of the 401K Ted B. says a 401k is the disaster and needs to be replaced!

Only 19 percent of Americans have pensions and 16 of those work for the government I read the other day that the average person only has about $135, 000 in their 401K. Well let me ask you a question: How many years is that going to last especially with the inflation that's going on the price of food and fuel? it's unattainable.

I have a team of people that I work- with top CPAs tax specific attorneys and other specialists in their fields and we collaborate together to see how to solve people's financial problems.

My practice is process driven not product driven. I treat my business just like a doctor & I will ask question after question and I expect this question to be answered because if I were to come up with some feasibility study or some financial plan without those questions answered it will be malpractice on my part.

I want people to understand things. I want them to become educated & I show people how to think outside the box of conventional financial planning & show them how to reduce and possibly eliminate both debt and taxes and then set them up with a tax-free retirement! People need to expand their knowledge & I am here to help them.

Alan Porter

 
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