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Speaker 1: Is happening.

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Speaker 2: It's time to end the failed experiment of open borders.

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Speaker 1: Your countries are going to hell. Something in our country,

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Speaker 1: Charlie Kirk, I forgive.

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Speaker 3: Them Antifa across this country would be Trump assess and

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Speaker 3: Ryan Ruth guilty on all five charges.

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Speaker 1: Something in our world.

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Speaker 4: Cato countries should shoot down Russian ear crash Ricky in

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Speaker 4: all day they enter.

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Speaker 5: Their ear space.

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Speaker 1: It's always something yes, I do.

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Speaker 5: It's a very important moment.

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Speaker 6: Fifty five KRC the talk station.

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Speaker 1: Tonight, the Federal Reserve Chair offers clues on where interest

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Speaker 1: rates are headed, and we'll show you how to take

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Speaker 1: advantage of the twenty twenty six tax brackets and we

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Speaker 1: answer your questions. You're listening to Simply Money, presented by

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Speaker 1: all Worth Financial on Bob Spondseller along with Brian James Well.

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Speaker 1: FED Chair Jerome Powell spoke to economists for the first

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Speaker 1: time since the government shut down, and of course people

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Speaker 1: were all ears wanting to know how the Fed is

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Speaker 1: supposed to navigate interesrates without having some of the necessary

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Speaker 1: data that they all you know, because after all, they

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Speaker 1: are data dependent. Brian, how are they going to make

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Speaker 1: heads or tails of the economy without having government data.

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Speaker 1: Walk us through what FED chair pal had to say yesterday.

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Speaker 1: I found it to be absolutely riveting.

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Speaker 3: I'm sensing just a bit of sarcasm this morning there, Bob.

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Speaker 3: I don't know, I have a sixth sense for these things.

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Speaker 3: But I don't think you met what you just said.

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Speaker 3: So let's talk about what got Bob so focused and

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Speaker 3: riveted on federal government governmental announcements.

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Speaker 1: So on the shutdown and the data is right.

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Speaker 3: So the big thing is we've shut down a lot

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Speaker 3: of the pipelines that we used to get information from

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Speaker 3: under the auspices of the information's no good anyway, so

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Speaker 3: therefore we must not need it at all or get

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Speaker 3: it from somewhere else. So any read in my mind,

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Speaker 3: I know your opinionated on that particular topic, but so

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Speaker 3: I ed reserved there. Jerome Powell did say that they've

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Speaker 3: got a good read on the economy despite the shutdown.

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Speaker 3: Labor market weakness is remains his biggest concern as the

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Speaker 3: key risk to the economy, and that kind of goes

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Speaker 3: without saying that's always out there lurking in the background.

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Speaker 3: If we don't have people who have jobs and we

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Speaker 3: don't have money moving in a circle and so forth.

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Speaker 3: Now that's not an immediate concern, but it's basically he's

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Speaker 3: saying it's the biggest thing on his radar screen. And

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Speaker 3: he did acknowledge that they don't have all the data

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Speaker 3: that they used to Some of the important government data

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Speaker 3: is simply not available anymore because of those decisions that

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Speaker 3: were made. But he did say the FED does have

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Speaker 3: access to a wide variety of both public and private data,

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Speaker 3: as well as a nationwide network of contacts who gather

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Speaker 3: their own information, and so he's using those to assess

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Speaker 3: economic conditions. Didn't really commit on the next interest rate cut,

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Speaker 3: which would be maybe at a late October meeting if

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Speaker 3: it happens at all, but saying that the Central Bank

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Speaker 3: is going to decide at the meeting what to do.

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Speaker 3: So that was a headline that was not a headline

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Speaker 3: at all. And also he made a big point of

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Speaker 3: saying that the FED has not predecided the outcome for

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Speaker 3: that October twenty eight, twenty nine meeting.

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Speaker 1: Yeah, I mean I read this is chair Pal basically

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Speaker 1: said exactly almost verb beata in what our own chief

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Speaker 1: investment officer Andy stout here at Allworth was talking about

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Speaker 1: on Monday. You know, there's concern about the labor market,

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Speaker 1: you know, all joking aside, there is concern about layoffs

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Speaker 1: and slow hiring. FED chair pal did say that there's

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Speaker 1: mounting evidence now that suggests both layoffs and hiring remain low.

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Speaker 1: But as Andy said, you know on Monday, the FED

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Speaker 1: has always had ways to go out and gather a

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Speaker 1: lot of this data by actually talking to companies and

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Speaker 1: talking to the private sector. In other words, they don't

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Speaker 1: need to gather this stuff, you know, via fax machine,

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Speaker 1: through the Bureau of Labor Statistics, which you know, we've

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Speaker 1: come to find out the data is often old news

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Speaker 1: if they get it at all. So anyway, we won't

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Speaker 1: bang home that point. But I do think that they

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Speaker 1: are watching the labor market. Let's face the hiring is slowing,

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Speaker 1: and you know, there's arguments on both sides of all

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Speaker 1: this that hey, you know, no kidding, hiring is slowing.

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Speaker 1: Cut interest rates make capital cheaper for companies and they'll

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Speaker 1: start hiring folks. But who knows anyway. FED chair pal

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Speaker 1: did say that on inflation, he said, quote goods prices

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Speaker 1: price increases are primarily terrif related broader rather than broader

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Speaker 1: inflationary you know pressures, which means and he also said

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Speaker 1: most longer term expectations are getting more aligned with our

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Speaker 1: two percent inflation inflation goal. I read that to say, Brian,

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Speaker 1: and I'd love your perspective on this. If not for tariffs,

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Speaker 1: we'd be closer to two percent inflation. I don't know

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Speaker 1: if that's true or not, but that's that's the story

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Speaker 1: that the Fed is going with at least as of today.

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Speaker 3: I think we need to give everything more time to

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Speaker 3: adjust to our new world of less data and more

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Speaker 3: shooting from the hip with regard to these governmental decisions.

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Speaker 3: I don't like the idea, frankly, that that's that the

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Speaker 3: impact of these decisions is not going to be as

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Speaker 3: verifiable since we have just decided not to you know,

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Speaker 3: not to track some of these things anymore. And I

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Speaker 3: think there I think there was a lot of value

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Speaker 3: in that, Frankly, Uh, and I think we're going to

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Speaker 3: miss that over the over the short term here we

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Speaker 3: may we may figure out another way to do it.

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Speaker 2: So Uh.

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Speaker 3: The other points he brought up on the balance sheet,

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Speaker 3: so the Federal Reserve could be hitting a point in

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Speaker 3: coming months where it's gonna stop shrinking the balance sheet.

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Speaker 3: So what this is doing, what we're referring to here

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Speaker 3: is the FED has slowly but steadily been reducing the

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Speaker 3: balance sheet by about two point two trillion dollars basically

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Speaker 3: just dumping assets.

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Speaker 1: Uh. And this is this is a quantitative tightening policy. UH.

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Speaker 3: Wall Street pays attention to this because it does take

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Speaker 3: liquidity out of the markets. If there isn't as much

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Speaker 3: supply there, then that does that does have an impact.

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Speaker 3: But these are tools that the Federal Reserve uses to

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Speaker 3: achieve the goals that it has.

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Speaker 1: With regard to an unemployment and the interest rate policies

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Speaker 1: and so forth. Well, when we generally talk about the

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Speaker 1: Fed's balance sheet and quantitative tightening or easying, I mean

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Speaker 1: we're talking about the FED stepping in and buying treasury securities,

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Speaker 1: you know, buying government debt. And you know, I think

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Speaker 1: I think it's good that they're trimming their balance sheet,

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Speaker 1: but that means that the bond market, the US bond

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Speaker 1: market is going to have to stand on its own

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Speaker 1: two feet without government intervention. And I think we'll get

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Speaker 1: accurate pricing on on treasury bonds. You know, the ten

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Speaker 1: year treasury has been coming down and that's a good thing.

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Speaker 1: So it remains to be seen. And we still you know, look,

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Speaker 1: we still have to get the president of the United

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Speaker 1: States and you know, the leadership of China in a

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Speaker 1: room together and figure out this you know, tit for tat,

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Speaker 1: you know, tariff back and forth. That's that's really what's

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Speaker 1: going to move the needle here in the short term.

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Speaker 1: And who knows if they're gonna meet, what's gonna be

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Speaker 1: talked about. I mean, right now, it's just social media,

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Speaker 1: you know, posturing by both parties. We've seen this story before.

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Speaker 1: They'll come up with something, or they'll just continue to

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Speaker 1: kick the can down the road a little bit longer.

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Speaker 3: So, uh, hey, baba, I want to I want to

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Speaker 3: touch back on something because I feel like you and

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Speaker 3: I just both both just barfed up a bunch of

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Speaker 3: economic mumbo jumbo that doesn't really mean much to the

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Speaker 3: average person who doesn't think about this stuff all day.

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Speaker 3: So I want to go back to what what does

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Speaker 3: it mean when the FED is buying government debt? Well,

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Speaker 3: what that means is that is that the Federal Reserve

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Speaker 3: is literally purchasing treasury bonds and bills, which which are

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Speaker 3: those are IOUs that that it issued in the past, right,

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Speaker 3: so they're just buying it's buying its own debt back.

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Speaker 3: We borrow by selling treasuries to the general public. When

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Speaker 3: the Fed, when the government buys those treasuries back, it

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Speaker 3: is putting new money back into the financial system and

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Speaker 3: reducing its own debt.

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Speaker 1: So think of it like this.

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Speaker 3: The US Treasury is borrowing money to pay for government spending.

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Speaker 3: The Federal Reserve creates money electronically to buy that debt

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Speaker 3: from banks and investors. Now those sellers have cash instead

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Speaker 3: of bonds. That cash finds its way back into the economy.

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Speaker 3: So it's a trick that they we used to reduce

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Speaker 3: government debt and put that cash back into circulation to

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Speaker 3: kind of goose.

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Speaker 1: Things a little bit. So hopefully, hopefully that explains a

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Speaker 1: little of what we just know. No, that's good, excellent clarification.

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Speaker 1: All right, let's move on to earnings, you know apps,

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Speaker 1: you know, after all, earnings is the mother's milk that

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Speaker 1: moves the stock market up and down. So far, Brian,

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Speaker 1: the news has been positive in the banking industry. You know,

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Speaker 1: most of the earnings that have come out so far

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Speaker 1: have been from the big banks, you know, reporting earlier

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Speaker 1: this week, yesterday, and there's more coming out today. You know,

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Speaker 1: walk us through some of the big bank results for

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Speaker 1: the third quarter.

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Speaker 3: Yeah, banks are doing okay. Don't lose sleep over the

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Speaker 3: success of the banking industry. So so start off with

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Speaker 3: City Group. City Group beat Wall Street estimates for earnings

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Speaker 3: per share. Goldman Sachs profit for the third quarter was

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Speaker 3: up thirty seven percent from a year earlier.

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Speaker 1: You know, it's good to see the kids make it right.

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Speaker 3: These these tiny, little scrappy little financial institutions doing okay

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Speaker 3: here quarter to quarter. Wells Fargo everybody's favorite bank to

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Speaker 3: beat up whenever they play games with their their their

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Speaker 3: sales processes, their earnings per share beat analyst expectations. And

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Speaker 3: JP Morgan Chase, which is kind of the nine hundred

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Speaker 3: pound guerrilla in the room. That's the largest US bank

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Speaker 3: by assets, by the way, Well, JP Morgan's third quarter

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Speaker 3: net income was up about twelve percent from a year

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Speaker 3: ago to about fourteen point four billion dollars. And another

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Speaker 3: another big one, Black Rocks Funds, attracted about two hundred

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Speaker 3: and five billion dollars worth of net flows in the

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Speaker 3: third quarter, and that was the analyst forecast for that

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Speaker 3: was just under one hundred and seventy two billion dollars,

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Speaker 3: so they beat that by by a good chunk there.

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Speaker 1: With two hundred and five billion. So anyway, these are

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Speaker 1: good stories. We're just seeing that.

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Speaker 3: This is what chief investment Officer Andy Stout of all

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Speaker 3: Worth told us just a few days ago. We're just

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Speaker 3: seeing the numbers coming from the results that we were expecting.

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Speaker 3: So Wall Street analysts estimate that S and P five

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Speaker 3: hundred earnings are going to grow about seven point four

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Speaker 3: percent here in the third quarter, and that so far

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Speaker 3: has held up, and we've had about three quarters of

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Speaker 3: companies typically beat their earnings estimates, so we're not going

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Speaker 3: to be surprised to see those those posting growth numbers

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Speaker 3: about ten percent or even more.

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Speaker 1: You're listening to Simply Money presented by all Worth Financial

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Speaker 1: on Bob Sponseller along with Brian James Brian shifting gears

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Speaker 1: a little bit here again the number of four to

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Speaker 1: one k investors, a large number of them apparently hit

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Speaker 1: the brakes last month on stocks, dumping some stock positions

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Speaker 1: and moving into cash and bonds. And the key question

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Speaker 1: tonight is why there could be a bunch of reasons

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Speaker 1: behind that according to new data from All All Light

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Speaker 1: Solutions never heard of them. They track more than two million,

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Speaker 1: four to one k participants. There was a shift in September.

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Speaker 1: Investors moved heavily out of equities and into more conservative options.

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Speaker 1: Of the fourteen of the twenty one trading days in September,

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Speaker 1: net trading activity was moving away from equities. This marked

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Speaker 1: the highest level of investor movements and March. Why do

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Speaker 1: you think that's happened, Brian.

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Speaker 3: Well, because a bunch of people woke up one day

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Speaker 3: and decided that they were expert market timers all of

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Speaker 3: a sudden.

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Speaker 1: Look, this is not a good idea.

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Speaker 3: You know, I would really want wonder as to the

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Speaker 3: age of some of these people. Right, if you're about

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Speaker 3: to retire, and you know you've got some and we

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Speaker 3: talk all the time, especially lately, you know, if you've

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Speaker 3: got expenses coming up that you need to take distributions on,

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Speaker 3: you know that's coming, then yeah, it's a good idea

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Speaker 3: to take some risk off the table.

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Speaker 1: Prepare for that. But if these people who are.

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Speaker 3: Doing this are twenty thirty years old, they're going to

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Speaker 3: regret it if they ever figure out that they made

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Speaker 3: a mistake. Because they're doing this at a time where

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Speaker 3: the market's where the market has had a bit of

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Speaker 3: a pullback from it's high, not very much, but just

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Speaker 3: just a little bit.

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Speaker 1: We're just we're not on the upward escalator anymore. We

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Speaker 1: came down just a little bit.

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Speaker 3: But so in other words, people are doing this having

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Speaker 3: missed that peak, and they're going to miss the upside too,

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Speaker 3: because the market will move upward.

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Speaker 1: Before the headlines go up.

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Speaker 3: It'll bounce, We'll see a lot of head fakes, but

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Speaker 3: eventually one of those will be for real and it

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Speaker 3: will move back up. And at some point the role

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Speaker 3: coaster is going to be halfway up that first hill,

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Speaker 3: and people are gonna be gonna want to be running

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Speaker 3: up the steps to jump back on it. It's not

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Speaker 3: a good way to go. If you're a market timer,

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Speaker 3: please please get it.

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Speaker 1: Out of your system. It's not gonna end well for

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Speaker 1: you or or maybe Brian, some of these people have

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Speaker 1: been listening to this show where you and I have

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Speaker 1: been talking about for weeks. Now, you know, after a

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Speaker 1: good run up in the markets, now is a good

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Speaker 1: time to look at your asset allocation and make sure

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Speaker 1: you get things back in alignment. Maybe people are doing

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Speaker 1: the responsible blocking and tackling that we talk about all

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Speaker 1: the time. Let's hope. So for sure, Let's hope it's

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Speaker 1: more reallocation rather than market timing. Hope in one hand.

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Speaker 1: Blah blah blah. Coming up next, we'll break down the

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Speaker 1: new tax brackets for twenty twenty six and their potential

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Speaker 1: impact on your pocketbook. You're listening to Simply Money, presented

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Speaker 1: by all Worth Financial on fifty five KRC, the talk

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Speaker 1: station What's happening? Time for the shutdown to end? Closing

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Speaker 1: up Democrat programs.

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Speaker 3: Bodies and Gaza Lamas continues to have the gun.

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Speaker 1: We will disom the day's news.

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Speaker 6: Honoring Charlie's Metal a fifty five KRC talkstation.

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Speaker 5: All Worth Financial a registered investment advisory firm. Any ideas

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Speaker 5: presented during this program are not intended to provide specific

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Speaker 5: financial advice. You should consult your own financial advisor, tax consultant,

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Speaker 5: or a state planning attorney to conduct your own due diligence.

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Speaker 1: You're listening to Simply Money presented by all Worth Financial

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Speaker 1: on Bob Sponseller along with Brian James. If you can't

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Speaker 1: listen to Simply Money Live every night, subscribe and get

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Speaker 1: our daily podcasts. Just search simply Money on the iHeart

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Speaker 1: app or wherever you find your podcasts. Straight ahead of

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Speaker 1: six forty three. We're helping listeners with retirement balance, trust

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Speaker 1: advice although we're not attorneys, and old state plan help

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Speaker 1: and more sounds like in a state planning segment. Brian,

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Speaker 1: you better jump on chat GPT so we can figure

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Speaker 1: out what we're doing here. All right, let's talk about

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Speaker 1: something that doesn't make great dinner conversation unless you're married

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Speaker 1: to Andy Stout, but it absolutely affects your bottom line.

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Speaker 1: And that's the irs. Just released the new twenty twenty

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Speaker 1: six federal tax brackets. Brian, some more riveting information out

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Speaker 1: for people to digest what has changed as we head

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Speaker 1: into twenty twenty six. Because radio is.

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Speaker 3: The best way to look at numbers on pieces of paper.

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Speaker 3: I'm just gonna read all of this verbatim, and we'll

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Speaker 3: consider ourselves stewards of good tax information. Now, we're not

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Speaker 3: gonna glaze your eyes or your ears over. We're not

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Speaker 3: gonna read all this stuff. Here's the big picture. There's

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Speaker 3: not a whole lot of surprise. Basically, the numbers are

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Speaker 3: inching up to account for inflation a little bit. That's

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Speaker 3: really all just means a little more of your income

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Speaker 3: gets taxed at slightly higher thresholds. For most people, this

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Speaker 3: is gonna help offset inflation some but for help. But

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Speaker 3: for folks with higher income or big retirement distributions, it's

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Speaker 3: kind of still worth paying attention to. So let's jump

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Speaker 3: into some of the details that should get your attention.

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Speaker 3: Especially this time of year. Tis the season to talk

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Speaker 3: about roth IRA conversions, because most people should have a

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Speaker 3: pretty good idea. We're about eighty percent of the way

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Speaker 3: through the year, so should have a pretty good idea

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Speaker 3: what the tax year is going to wind up looking like,

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Speaker 3: and you'll need these remaining couple months to decide if

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Speaker 3: you're going to do this now. For those of you

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Speaker 3: who may not have heard of what I'm talking about,

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Speaker 3: we're referring to moving money from a traditional pre tax

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Speaker 3: IRA to a WROTH meaning I want to pay taxes

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Speaker 3: now so that from here forward for the rest of

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Speaker 3: my life, I'll pay no capital gains, no income taxes

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Speaker 3: on this money. So this benefits people who are at

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Speaker 3: lower brackets now then they'll be in the future, meaning

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Speaker 3: I want tax free distributions so that in the future

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Speaker 3: when I'm in a higher bracket, I can take advantage

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Speaker 3: of that of tax free money. This is mainly people

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Speaker 3: who were early retirees, early in retirement, who were relatively

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Speaker 3: higher earners in their working years, maybe people in the

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Speaker 3: twenty four to thirty seven percent brackets, you know, the

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Speaker 3: i'd say, the three hundred thousand and upcrowd. When those

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Speaker 3: folks retired, they could drop down to twenty two percent

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Speaker 3: or lower. But if they've got significant IRA savings, which

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Speaker 3: it's usually the case, is we see here, you know,

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Speaker 3: at these tables doing financial planning every day, required minimum

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Speaker 3: distributions kick indidate's seventy three or seventy five. That in

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Speaker 3: turn is going to force more taxes, more income taxes

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Speaker 3: on Social Security income, and it's gonna could likely trigger

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Speaker 3: Medicare IERMA search charges. Meeting your premiums go up just

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Speaker 3: a little bit. So if they convert now is the

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Speaker 3: whole point you'll pay less tax on that money than

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Speaker 3: in the future.

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Speaker 1: Brian, I want to call out a couple of examples

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Speaker 1: of actual meetings I've had with clients to talk about

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Speaker 1: this strategy over the last couple of weeks. Because the

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Speaker 1: the I found some interesting numbers when we actually dove

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Speaker 1: into the tax software and looked at the impact of

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Speaker 1: potentially doing some Wrath conversions. Here's what I mean. There

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Speaker 1: is a band of people at a certain income band

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Speaker 1: where even though you're in a lower tax bracket by

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Speaker 1: doing the Wroth conversion, now there are phase outs, you know,

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Speaker 1: based on your income on where you have to pay

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Speaker 1: higher Social Security taxes. And with this new you know,

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Speaker 1: social Security itemized deduction under the one big beautiful bill.

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Speaker 1: You know, this is one thing where you know, I

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Speaker 1: will criticize the President and the administration a little bit

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Speaker 1: on this one. They came out and said, hey, social

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Speaker 1: Security is tax free. Well it's really not tax free

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Speaker 1: for everyone. And here's what I mean. You got to

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Speaker 1: be careful if you start pulling money out thinking that

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Speaker 1: you because you might be in a lower marginal income

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Speaker 1: tax bracket. But if you pull too much money forward,

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Speaker 1: you could pay higher Social Security taxes and lose out

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Speaker 1: on some of that six thousand dollars for single people,

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Speaker 1: twelve thousand dollars for married folks itemized deduction for Social Security.

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Speaker 1: You got to watch that when you actually look at

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Speaker 1: the numbers. And I've seen that with my own eyes

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Speaker 1: here in a couple of meetings here over the last

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Speaker 1: couple of weeks, And when we actually ran the numbers,

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Speaker 1: we still did a little bit of a roth conversion,

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Speaker 1: but not quite as much as we thought we would

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Speaker 1: when we dove into the whole exercise, because you know, again,

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Speaker 1: because of these higher taxes or losses of the Social

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Speaker 1: Security deduction, it didn't give us as much benefit as

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Speaker 1: we thought we were going to get when we dove in.

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Speaker 1: I hope that makes sense, Brian. I know you run

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Speaker 1: numbers like this all day every day too. Are you

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Speaker 1: seeing some of the same things with your clients and

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Speaker 1: your review meetings? Yeah, for sure.

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Speaker 3: And as you mentioned, I'm not a huge fan of

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Speaker 3: this administration's a willingness to run fast and loose with

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Speaker 3: the facts. Yes, they let the tweets run all over

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Speaker 3: the place that Social Security is now tax free. That

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Speaker 3: was never even on the table. So all there is

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Speaker 3: is a new deduction up to six thousand dollars as

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Speaker 3: you mentioned per individual or twelve thousand for married couples.

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Speaker 3: Now that's from only only in existence for twenty five

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Speaker 3: to two twenty eight, And that happens whether you itemize

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Speaker 3: or take the standard deduction. And here's here's the important part, though, Bob,

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Speaker 3: it phases out completely if you're modified. Adjusted gross income

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Speaker 3: is over seventy five thousand dollars for a single or

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Speaker 3: one hundred and fifty for a joint filer.

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Speaker 1: So we've got a brief period.

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Speaker 3: Of time and a pretty tiny window of people who

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Speaker 3: are actually really gonna benefit from this, And yet they

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Speaker 3: let the let the announcement go out there that Social

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Speaker 3: Security is now tax free, and people took a hook

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Speaker 3: line and sacre. That stuff absolutely makes me mad as

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Speaker 3: an American voter, because we just we have to make decision.

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Speaker 3: I don't get to do financial planning for people based

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Speaker 3: on stuff I want to be true. It has to

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Speaker 3: be based on stuff that is true. Otherwise a plan

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Speaker 3: doesn't work. So just be careful. You know what you

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Speaker 3: believe and what you're how you're making your decisions. Largely,

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Speaker 3: the taxation of Social Security has not changed. Most people

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Speaker 3: are going to pay taxes on eighty five percent of

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Speaker 3: those benefits. You know, some people will benefit from that

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Speaker 3: that new deduction in the right income range in for

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Speaker 3: the next couple of years, But just assume you're going

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Speaker 3: to be paying income taxes on Social Security for at

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Speaker 3: least the foreseeable future.

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Speaker 1: Yeah. I think the point I'm just trying to drive

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Speaker 1: home here is you do need to sit down with

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Speaker 1: your fiducial advisor and your CPA and actually run these

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Speaker 1: numbers before you start pulling the trigger on things. There

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Speaker 1: are a bunch of people that are going to benefit

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Speaker 1: from that tax legislation, But when you start factoring in

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Speaker 1: some of these Wroth conversions and other strategies that we

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Speaker 1: work on for i'll say higher income folks, the benefits

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Speaker 1: go away pretty quickly. And to your point, Brian, it

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Speaker 1: would have been nice if that would have been explained

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Speaker 1: a little bit clear on the front end. All right,

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Speaker 1: here's the all Worth advice. You don't have to be

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Speaker 1: wealthy to use the tax code to your advantage, but

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Speaker 1: you have to plan like you are, and planning is

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Speaker 1: the operative word here. Run the numbers before you just

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Speaker 1: pull the trigger on some things coming up next, How

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Speaker 1: to actually prepare your kids for a future where AI

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Speaker 1: changes everything about work. You're listening to Simply Money, presented

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Speaker 1: by all Worth Financial and fifty five KRC.

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Speaker 6: The talks the days of relaxing in the drawing room

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Speaker 6: by the radio set are long gone.

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Speaker 1: These days, we're taking it to go.

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Speaker 6: The iHeartRadio powered by fifty five KRC dot com.

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Speaker 4: If you look at the RC an iHeartRadio station, you're.

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Speaker 1: Listening to Simply Money, presented by all Worth Financial. I'm

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Speaker 1: Bob Sponseller along with Brian James, joined tonight by our

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Speaker 1: career expert Julie Bauch. And Julie thanks as always for

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Speaker 1: joining us tonight. And you've got a pretty important topic

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Speaker 1: to cover. Real interested in your thoughts, and the topic is,

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Speaker 1: let's face it, giving career advice to kids has never

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Speaker 1: been more difficult. Walk us through what's going on out

438
00:21:46,480 --> 00:21:49,959
Speaker 1: there in the real world with respect to helping our

439
00:21:50,080 --> 00:21:51,760
Speaker 1: kids get gainfully employed.

440
00:21:53,359 --> 00:21:55,040
Speaker 4: No, I had to laugh when I saw that title

441
00:21:55,080 --> 00:21:57,560
Speaker 4: because my first thought was, as if they listened anyway,

442
00:21:59,400 --> 00:22:01,120
Speaker 4: my kids. I know what I'm doing, and my kids

443
00:22:01,160 --> 00:22:02,920
Speaker 4: don't listen. One of them does, one of them doesn't.

444
00:22:03,240 --> 00:22:06,240
Speaker 1: But yeah, it's it's this morning.

445
00:22:09,000 --> 00:22:13,199
Speaker 4: So the back in the day, it was it was

446
00:22:13,320 --> 00:22:17,720
Speaker 4: very easy to say go to college, something great will

447
00:22:17,760 --> 00:22:21,280
Speaker 4: be waiting for you. It's the path, it's the firm

448
00:22:21,480 --> 00:22:24,560
Speaker 4: path to success and to having the life you want,

449
00:22:25,240 --> 00:22:28,000
Speaker 4: and that is completely smashed at this point. And so

450
00:22:28,160 --> 00:22:32,320
Speaker 4: now as parents have kids in high school, kids thinking

451
00:22:32,320 --> 00:22:35,440
Speaker 4: about what sort of post high school education do I want,

452
00:22:36,000 --> 00:22:38,720
Speaker 4: be it trade school or just something post high school,

453
00:22:38,720 --> 00:22:43,320
Speaker 4: which pretty much everyone needs, we're at a loss as

454
00:22:43,440 --> 00:22:47,840
Speaker 4: to how to be helpful in that conversation because that

455
00:22:48,000 --> 00:22:53,600
Speaker 4: path has completely been smashed. Whether it is just gigantic debt,

456
00:22:53,760 --> 00:22:59,040
Speaker 4: a job market disconnect between what your your kids want

457
00:22:59,040 --> 00:23:03,160
Speaker 4: to do and what's available, just lack of job search skills.

458
00:23:03,200 --> 00:23:07,520
Speaker 4: So it's everything has changed when it comes to this area.

459
00:23:07,560 --> 00:23:11,359
Speaker 4: But I think it's an opportunity because what is going

460
00:23:11,440 --> 00:23:15,320
Speaker 4: to allow us to do is allow our kids to

461
00:23:15,359 --> 00:23:18,560
Speaker 4: be more involved in the conversation. And the challenge here

462
00:23:18,760 --> 00:23:25,280
Speaker 4: is going to be as parents believing that they know themselves,

463
00:23:26,359 --> 00:23:30,200
Speaker 4: understanding that we may have this dream. If they're really

464
00:23:30,200 --> 00:23:32,760
Speaker 4: great with their hands, it might be the Boomer or

465
00:23:32,800 --> 00:23:35,520
Speaker 4: gen X response might be, oh great, you could be

466
00:23:35,520 --> 00:23:38,560
Speaker 4: a mechanical engineer. And I think what we've got to

467
00:23:38,560 --> 00:23:41,879
Speaker 4: say as an example in that case is or you

468
00:23:41,920 --> 00:23:44,520
Speaker 4: could be a technician, you could be an hvac you

469
00:23:44,520 --> 00:23:46,399
Speaker 4: can own an HVAC company, you could be an HVAC

470
00:23:46,480 --> 00:23:50,040
Speaker 4: repair person. You could be in auto repair. You could,

471
00:23:50,119 --> 00:23:55,000
Speaker 4: you know, So there's to not just pigeonhole your kids

472
00:23:55,040 --> 00:23:59,480
Speaker 4: into something that feels like a path that felt safe

473
00:23:59,520 --> 00:24:03,840
Speaker 4: to us. Is going to be really critical because you

474
00:24:03,880 --> 00:24:08,359
Speaker 4: shouldn't be giving advice that worked decades ago or even

475
00:24:08,440 --> 00:24:12,879
Speaker 4: a decade ago to today because it's entirely different and so,

476
00:24:13,800 --> 00:24:15,920
Speaker 4: you know, it's I think the first thing in this

477
00:24:16,080 --> 00:24:19,960
Speaker 4: in this is to recognize that the advice that we

478
00:24:20,080 --> 00:24:22,920
Speaker 4: got that worked for us and worked for many others

479
00:24:23,480 --> 00:24:27,440
Speaker 4: isn't necessarily as relevant anymore. It's not that it's irrelevant,

480
00:24:27,440 --> 00:24:31,000
Speaker 4: but it's not as relevant. The kids have more options

481
00:24:31,600 --> 00:24:34,000
Speaker 4: than they used to and it's exciting, but it can

482
00:24:34,040 --> 00:24:36,040
Speaker 4: also be overwhelming. So I think our role as a

483
00:24:36,080 --> 00:24:40,760
Speaker 4: parent can be exposed them to as many opportunities, conversations,

484
00:24:40,800 --> 00:24:44,040
Speaker 4: and places and people as possible and help them start

485
00:24:44,080 --> 00:24:48,600
Speaker 4: to discern what sounds interesting, what they might want to

486
00:24:48,680 --> 00:24:52,880
Speaker 4: learn more about, and then explore all the various education

487
00:24:53,080 --> 00:24:55,880
Speaker 4: paths and experience paths to get there, because it's not

488
00:24:56,320 --> 00:24:58,480
Speaker 4: it's not a one and done anymore that these those

489
00:24:58,560 --> 00:24:59,120
Speaker 4: days are gone.

490
00:24:59,359 --> 00:25:01,920
Speaker 3: Hey, Julie, So one of the topics that I wanted

491
00:25:01,920 --> 00:25:05,200
Speaker 3: to hear from you on and that's great. I appreciate

492
00:25:05,240 --> 00:25:09,120
Speaker 3: that update. But with regard to AI, so that's everywhere,

493
00:25:09,160 --> 00:25:11,800
Speaker 3: and I kind of feel like, yeah, you can identify some.

494
00:25:11,800 --> 00:25:13,880
Speaker 1: Jobs they clearly could be done by AI right now.

495
00:25:14,080 --> 00:25:15,920
Speaker 3: But I have a feeling that that label is getting

496
00:25:15,960 --> 00:25:18,879
Speaker 3: slapped on a lot of jobs where you know, maybe

497
00:25:18,920 --> 00:25:22,359
Speaker 3: parents are kind of prematurely discouraging their kids.

498
00:25:22,400 --> 00:25:24,560
Speaker 1: Do you see that happening. Do you find yourself, you.

499
00:25:24,560 --> 00:25:26,239
Speaker 3: Know, a position where you've got to say no, hold on,

500
00:25:26,280 --> 00:25:28,159
Speaker 3: there are still paths to go do this for a

501
00:25:28,200 --> 00:25:30,800
Speaker 3: living without AI being factor, or yeah, tell me about that.

502
00:25:30,880 --> 00:25:31,280
Speaker 1: Yeah.

503
00:25:31,440 --> 00:25:34,240
Speaker 4: So here's what I think is true. When we hear

504
00:25:34,320 --> 00:25:36,399
Speaker 4: the phrase all these jobs are going to be replaced

505
00:25:36,400 --> 00:25:39,120
Speaker 4: by AI, I think it's more. I think it's more

506
00:25:39,200 --> 00:25:42,240
Speaker 4: true to say almost every job or every job will

507
00:25:42,280 --> 00:25:45,360
Speaker 4: be affected in some way by AI, and it might

508
00:25:45,440 --> 00:25:48,120
Speaker 4: just affect the way you do the job. It might

509
00:25:48,160 --> 00:25:49,920
Speaker 4: not take the job, but it might affect the way

510
00:25:49,960 --> 00:25:51,679
Speaker 4: you do the job. So when you look at what

511
00:25:51,760 --> 00:25:56,160
Speaker 4: are the things that we know to be true as

512
00:25:56,160 --> 00:25:59,480
Speaker 4: we look forward everyone entering the job market. In the

513
00:25:59,520 --> 00:26:02,400
Speaker 4: job market, it has to have a comfort level with technology,

514
00:26:02,640 --> 00:26:09,280
Speaker 4: with learning technology. They have to have really strong people skills,

515
00:26:09,760 --> 00:26:17,480
Speaker 4: soft skills listening, communicating, presenting, influencing, working across, working with customers.

516
00:26:17,960 --> 00:26:22,440
Speaker 4: They have to have those what we call soft skills. Now,

517
00:26:22,480 --> 00:26:25,280
Speaker 4: really those saft skills are becoming the most important. And

518
00:26:25,320 --> 00:26:28,000
Speaker 4: so as you look at how do you prepare your

519
00:26:28,040 --> 00:26:31,480
Speaker 4: son or daughter for what's next. The three buckets I

520
00:26:31,480 --> 00:26:36,199
Speaker 4: would focus on is technology. Now they're digital natives, but

521
00:26:36,359 --> 00:26:39,120
Speaker 4: you are not. Everybody is as comfortable as everybody else.

522
00:26:39,160 --> 00:26:42,320
Speaker 4: But are they getting exposed to the different ways that

523
00:26:42,400 --> 00:26:45,800
Speaker 4: technology help us work and do and live our lives better?

524
00:26:46,440 --> 00:26:50,000
Speaker 4: And the second is really, you know, the soft skills,

525
00:26:50,040 --> 00:26:52,680
Speaker 4: the communicating, getting along with people. You can be brilliant,

526
00:26:52,680 --> 00:26:55,200
Speaker 4: but if you're difficult to work with, you know you're

527
00:26:55,200 --> 00:26:56,840
Speaker 4: not going to have the career you want. And the

528
00:26:56,920 --> 00:27:01,240
Speaker 4: third is really an openness to learning, to taking feedback,

529
00:27:01,880 --> 00:27:04,959
Speaker 4: to getting excited about what else can I learn? What

530
00:27:05,000 --> 00:27:07,119
Speaker 4: else can I do? Those are the kind of people

531
00:27:07,320 --> 00:27:09,720
Speaker 4: and really that applies to us of all ages. The

532
00:27:09,760 --> 00:27:12,600
Speaker 4: companies are really looking for anything that smacks up I've

533
00:27:12,600 --> 00:27:15,440
Speaker 4: always done it this way, no matter how old you are,

534
00:27:15,680 --> 00:27:18,800
Speaker 4: is going to you know, is really going to limit

535
00:27:18,800 --> 00:27:20,440
Speaker 4: I would say, your opportunities for.

536
00:27:20,400 --> 00:27:24,600
Speaker 1: Growth, Julie. When I listen to you talk here, I think,

537
00:27:24,680 --> 00:27:26,600
Speaker 1: you know, I agree with you. I think the whole

538
00:27:26,640 --> 00:27:29,600
Speaker 1: paradigm here for the last five, ten, fifteen, twenty years

539
00:27:29,640 --> 00:27:33,720
Speaker 1: has been this specialization into certain areas. And what I

540
00:27:33,760 --> 00:27:36,439
Speaker 1: mean by that is we tell our kids to, you know,

541
00:27:36,520 --> 00:27:40,200
Speaker 1: get a STEM degree. Well, you know you mentioned technology.

542
00:27:40,280 --> 00:27:43,320
Speaker 1: What can tend to happen is people bury themselves behind

543
00:27:43,320 --> 00:27:46,400
Speaker 1: a computer screen and just work with numbers all day

544
00:27:46,440 --> 00:27:49,480
Speaker 1: and they have zero people skills. They've never interacted with

545
00:27:49,560 --> 00:27:54,360
Speaker 1: a customer, They've never had to critically think and engage

546
00:27:54,400 --> 00:27:57,919
Speaker 1: in God forbid, a disagreement with another human being, and

547
00:27:57,920 --> 00:28:00,800
Speaker 1: how to resolve that. That kind of is not going

548
00:28:00,880 --> 00:28:02,880
Speaker 1: to get solved by AI. You got to get out

549
00:28:02,880 --> 00:28:05,399
Speaker 1: there and mix it up in the world. I mean, shoot,

550
00:28:05,440 --> 00:28:08,960
Speaker 1: even standing behind a cash register at McDonald's for a

551
00:28:09,040 --> 00:28:11,080
Speaker 1: couple of years when you're in high school, you learn

552
00:28:11,560 --> 00:28:16,160
Speaker 1: incredible skills that are transferable to any job moving forward.

553
00:28:16,320 --> 00:28:19,919
Speaker 1: I think we've lost sight of that in society today.

554
00:28:21,119 --> 00:28:24,960
Speaker 4: We have and I just you know it's we have aired.

555
00:28:25,119 --> 00:28:27,920
Speaker 4: We have moved over to the side of I want

556
00:28:27,920 --> 00:28:30,600
Speaker 4: my kids to take as many AP classes as possible. Yes,

557
00:28:30,800 --> 00:28:33,080
Speaker 4: and then we send them off to a prestigious college

558
00:28:33,280 --> 00:28:36,240
Speaker 4: and say, Okay, they're good now, No they're not. And

559
00:28:36,280 --> 00:28:39,320
Speaker 4: I think we see the numbers of how young people

560
00:28:39,320 --> 00:28:42,520
Speaker 4: are really struggling. They're struggling because they don't know how

561
00:28:42,560 --> 00:28:46,080
Speaker 4: to navigate this world right now, and it is very challenging.

562
00:28:46,120 --> 00:28:49,360
Speaker 4: It's easy for us as boomers to say tough en up,

563
00:28:49,760 --> 00:28:53,080
Speaker 4: but it's bigger than that. And so what anything you

564
00:28:53,120 --> 00:28:57,040
Speaker 4: can do to expose your kids to difficult conversations. Don't

565
00:28:57,160 --> 00:28:59,600
Speaker 4: order their food for them, don't call their teachers, don't

566
00:29:00,120 --> 00:29:03,560
Speaker 4: make them step out and step into uncomfortable situations, and

567
00:29:03,600 --> 00:29:05,040
Speaker 4: don't get in there with a rag and try to

568
00:29:05,080 --> 00:29:08,000
Speaker 4: clean up messads. That's the kind of stuff that employers

569
00:29:08,040 --> 00:29:10,840
Speaker 4: are really struggling with. You might be making yourself feel

570
00:29:10,880 --> 00:29:14,360
Speaker 4: better in the moment, but you're really hurting your child's

571
00:29:14,440 --> 00:29:15,640
Speaker 4: chances for career success.

572
00:29:16,440 --> 00:29:18,720
Speaker 1: All right, good stuff as always, Julie, thanks again for

573
00:29:18,800 --> 00:29:21,400
Speaker 1: joining us. You're listening to Simply Money, presented by all

574
00:29:21,400 --> 00:29:25,840
Speaker 1: Worth Financial on fifty five KRC, the talk station. Hiks,

575
00:29:25,880 --> 00:29:28,240
Speaker 1: Ryan Thomas, Lee, Mark Levin.

576
00:29:28,440 --> 00:29:32,800
Speaker 2: We Americans, we patrids are irrational, irreasonable people. The people

577
00:29:32,800 --> 00:29:35,200
Speaker 2: who know good from either right from wrong. We also

578
00:29:35,240 --> 00:29:38,840
Speaker 2: know hustlers and Marxists and fascists in Islamist who endanger

579
00:29:38,880 --> 00:29:42,000
Speaker 2: our country every damn day. We're destroying our culture into

580
00:29:42,040 --> 00:29:45,480
Speaker 2: civil society, who are breeding a youth that hates America

581
00:29:45,680 --> 00:29:47,000
Speaker 2: and embraces the wrong thing.

582
00:29:47,280 --> 00:29:51,000
Speaker 6: Mark Levin tonight at ten oh six on fifty five KRC,

583
00:29:51,440 --> 00:29:52,640
Speaker 6: the talk station.

584
00:29:57,200 --> 00:29:59,600
Speaker 1: You're listening to Simply Money, presented by all Worth Financial

585
00:29:59,680 --> 00:30:02,840
Speaker 1: on bo sponsorer along with Brian James. Do you have

586
00:30:02,880 --> 00:30:05,400
Speaker 1: a financial question you'd like for us to answer. There's

587
00:30:05,400 --> 00:30:07,560
Speaker 1: a red button you can click while you're listening to

588
00:30:07,600 --> 00:30:10,719
Speaker 1: the show right on the iHeart app. Simply record your

589
00:30:10,800 --> 00:30:14,680
Speaker 1: question and it will come straight to us. Cynthia and

590
00:30:14,840 --> 00:30:18,040
Speaker 1: Mason leads us off tonight. Brian She says, our portfolio

591
00:30:18,080 --> 00:30:21,200
Speaker 1: has done well, but we haven't updated our risk profile

592
00:30:21,360 --> 00:30:24,320
Speaker 1: in years. How do you know when it's time to

593
00:30:24,320 --> 00:30:29,479
Speaker 1: adjust your mix? Good topic to talk about. Yeah, I

594
00:30:29,600 --> 00:30:30,240
Speaker 1: like this question.

595
00:30:30,360 --> 00:30:33,200
Speaker 3: So when I started in this industry, there was a

596
00:30:33,280 --> 00:30:35,640
Speaker 3: rule of thumb. As our old friend Ed Fink used

597
00:30:35,640 --> 00:30:36,840
Speaker 3: to say, rules of thumb are.

598
00:30:36,760 --> 00:30:37,480
Speaker 1: Rules of dumb.

599
00:30:38,080 --> 00:30:40,280
Speaker 3: And the rule of thumb back then was your age

600
00:30:40,360 --> 00:30:42,920
Speaker 3: in bonds. That was just the greatest balanced portfolio ever.

601
00:30:42,960 --> 00:30:44,280
Speaker 3: That that's how you could kind of set it and

602
00:30:44,280 --> 00:30:46,280
Speaker 3: forget it while I'm sitting here at fifty one and

603
00:30:46,320 --> 00:30:48,560
Speaker 3: I'm darn glad that I don't have half my portfolio

604
00:30:48,640 --> 00:30:50,560
Speaker 3: in bonds because of a rule of thumb from thirty

605
00:30:50,640 --> 00:30:54,120
Speaker 3: years ago, which is a lifetime and several economic eras ago.

606
00:30:54,560 --> 00:30:57,280
Speaker 3: So now, Cynthia, I think it has everything to do

607
00:30:57,360 --> 00:31:00,680
Speaker 3: with with how you'll react to the up and ups

608
00:31:00,720 --> 00:31:03,400
Speaker 3: and downs of the markets. I have lots of clients

609
00:31:03,400 --> 00:31:05,120
Speaker 3: who are I don't know how old you are, but

610
00:31:05,160 --> 00:31:06,680
Speaker 3: I have call on clients who may very well be

611
00:31:06,680 --> 00:31:08,880
Speaker 3: older than you that are still completely one hundred percent

612
00:31:08,880 --> 00:31:11,560
Speaker 3: stocks because we've talked about it, we've done their financial plan,

613
00:31:12,000 --> 00:31:14,520
Speaker 3: and the portion of that we of the portfolio that

614
00:31:14,520 --> 00:31:18,120
Speaker 3: we've got in stocks has nothing to do with generating

615
00:31:18,160 --> 00:31:20,960
Speaker 3: income for them. Their income is covered from maybe just

616
00:31:21,000 --> 00:31:23,640
Speaker 3: social security or socicurity plus pension or some other business

617
00:31:23,720 --> 00:31:25,800
Speaker 3: assets they've got out there, and that means that the

618
00:31:26,080 --> 00:31:28,920
Speaker 3: pile of money that is their nest egg can still

619
00:31:28,960 --> 00:31:31,440
Speaker 3: be aggressive. And if they're okay with the headlines and

620
00:31:31,480 --> 00:31:33,760
Speaker 3: they they have one hundred percent, they have one hundred

621
00:31:33,760 --> 00:31:36,640
Speaker 3: percent of their emergency fund in crypto too, right of course.

622
00:31:36,680 --> 00:31:38,480
Speaker 1: Well that's where we start. I mean I figured that

623
00:31:38,520 --> 00:31:39,720
Speaker 1: was assumed. Yep.

624
00:31:41,440 --> 00:31:44,640
Speaker 3: We've got everybody in a place where if the if

625
00:31:44,680 --> 00:31:47,600
Speaker 3: the foundation of the plan is successful and you've got

626
00:31:47,600 --> 00:31:50,440
Speaker 3: the needs covered, then some people say, you know what,

627
00:31:50,480 --> 00:31:51,880
Speaker 3: I just want to grow it. It's going to sit here,

628
00:31:51,960 --> 00:31:53,200
Speaker 3: util it goes to my kids. So I'd like to

629
00:31:53,240 --> 00:31:55,840
Speaker 3: be aggressive and continue to grow it. So there isn't

630
00:31:55,840 --> 00:31:58,440
Speaker 3: a I would say that there's not an exact time

631
00:31:58,480 --> 00:32:01,080
Speaker 3: of life to adjust. That mixt be driven by your plan.

632
00:32:01,160 --> 00:32:03,440
Speaker 3: If your needs are covered elsewhere, then maybe you don't

633
00:32:03,440 --> 00:32:06,320
Speaker 3: have to adjust that mix. It's not again, let's not

634
00:32:06,360 --> 00:32:08,440
Speaker 3: go by rules of thumb. Let's build specific plans for

635
00:32:08,480 --> 00:32:12,000
Speaker 3: specific situations. So I hope that helps their Cynthia Paul

636
00:32:12,080 --> 00:32:14,440
Speaker 3: and Milford Bob Paul says they've built most of their

637
00:32:14,440 --> 00:32:17,200
Speaker 3: worth and retirement accounts and he's wondering if there's any

638
00:32:17,240 --> 00:32:20,040
Speaker 3: smart ways out there to create some more tax diversification

639
00:32:20,440 --> 00:32:22,800
Speaker 3: before they hit that RMD age of US seventy three

640
00:32:22,920 --> 00:32:24,680
Speaker 3: or seventy five. Don't know when Paul was born, but

641
00:32:24,720 --> 00:32:26,840
Speaker 3: it'll be one of those two for him.

642
00:32:27,240 --> 00:32:29,640
Speaker 1: All right, Well, Paul, we just covered some of this

643
00:32:29,840 --> 00:32:32,840
Speaker 1: in the prior segment today talking about WROTH conversions. That's

644
00:32:32,920 --> 00:32:36,880
Speaker 1: one strategy. Another strategy that you might consider, and I

645
00:32:36,920 --> 00:32:39,440
Speaker 1: know Brian likes this strategy and uses it a lot,

646
00:32:39,640 --> 00:32:42,480
Speaker 1: is you know, start to build that WROTH bucket. Now,

647
00:32:42,920 --> 00:32:45,640
Speaker 1: you know, if you are still working and still contributing

648
00:32:45,680 --> 00:32:48,880
Speaker 1: to retirement accounts, flip some of those savings over to

649
00:32:48,920 --> 00:32:52,280
Speaker 1: the WROTH bucket and create that second bucket of assets

650
00:32:52,320 --> 00:32:56,160
Speaker 1: from which you can take income during your retirement years.

651
00:32:57,080 --> 00:32:59,440
Speaker 1: And the other thing is, once you've tapped out all

652
00:32:59,480 --> 00:33:01,800
Speaker 1: of your retire hirement account savings and you've got some

653
00:33:01,880 --> 00:33:06,120
Speaker 1: discretionary income left to save, put that in a non IRA,

654
00:33:06,440 --> 00:33:10,160
Speaker 1: just taxable brokerage account. And again you're just creating buckets

655
00:33:10,200 --> 00:33:14,160
Speaker 1: from which you can draw money and play the tax

656
00:33:14,240 --> 00:33:18,000
Speaker 1: bracket game. Here wants it's time to convert this into

657
00:33:18,040 --> 00:33:21,800
Speaker 1: actual spending during retirement years, because you don't want to

658
00:33:21,880 --> 00:33:24,360
Speaker 1: just let these rm ds get out of whack. You know,

659
00:33:24,400 --> 00:33:27,000
Speaker 1: for reasons we talk about all the time. It could

660
00:33:27,080 --> 00:33:30,720
Speaker 1: end up causing you to pay higher Medicare premiums. It

661
00:33:30,720 --> 00:33:34,120
Speaker 1: could bump you into a higher tax bracket. So there's

662
00:33:34,160 --> 00:33:36,360
Speaker 1: a couple of thoughts to consider. Sit down and work

663
00:33:36,400 --> 00:33:39,440
Speaker 1: with somebody to help you run some scenarios on how

664
00:33:39,480 --> 00:33:43,320
Speaker 1: to make this the most tax efficient situation as possible.

665
00:33:43,400 --> 00:33:46,360
Speaker 1: All Right, Tom in Westchester says, we've got several trusts

666
00:33:46,360 --> 00:33:50,920
Speaker 1: and accounts spread across many different institutions. How do we

667
00:33:51,000 --> 00:33:55,080
Speaker 1: simplify this entire structure without losing the benefits?

668
00:33:55,160 --> 00:33:57,240
Speaker 3: Brian, So, yeah, I mean, I guess the first question

669
00:33:57,240 --> 00:33:59,720
Speaker 3: I'd have for you, Tom, is what is the benefit

670
00:33:59,760 --> 00:34:02,959
Speaker 3: of you having your accounts spread across several institutions? Is

671
00:34:02,680 --> 00:34:05,440
Speaker 3: that is that? Was that a purposeful decision? You know,

672
00:34:05,480 --> 00:34:08,000
Speaker 3: a lot some people believe that that's part of diversification.

673
00:34:08,160 --> 00:34:10,319
Speaker 3: Just have some different brains working on my money, And

674
00:34:10,360 --> 00:34:12,440
Speaker 3: that's understandable. It's not the worst idea in the world,

675
00:34:12,640 --> 00:34:14,879
Speaker 3: but it does literally put you in this situation. You're

676
00:34:14,880 --> 00:34:16,880
Speaker 3: gonna have lots of you know, each institution has to

677
00:34:16,880 --> 00:34:20,319
Speaker 3: have its own account accounts for you, owned by the

678
00:34:20,440 --> 00:34:22,880
Speaker 3: entities you need. So you mentioned trusts and all these

679
00:34:22,920 --> 00:34:24,879
Speaker 3: different types of accounts where you're gonna have that set

680
00:34:24,920 --> 00:34:28,120
Speaker 3: of ownership for every institution. So I would look under

681
00:34:28,120 --> 00:34:30,239
Speaker 3: the hood for what these institutions are doing for you.

682
00:34:30,440 --> 00:34:32,759
Speaker 3: And if if you've duplicated a lot of the of

683
00:34:32,800 --> 00:34:34,640
Speaker 3: what if they're kind of doing the same thing, which

684
00:34:34,680 --> 00:34:36,960
Speaker 3: in today's day and age, they're probably not far off.

685
00:34:37,200 --> 00:34:40,560
Speaker 3: There aren't magical solutions out there for financial investment management

686
00:34:40,680 --> 00:34:43,680
Speaker 3: that don't exist anywhere else. Despite what these various institutions

687
00:34:43,760 --> 00:34:46,520
Speaker 3: might really really want you to believe, everybody still is

688
00:34:46,560 --> 00:34:49,799
Speaker 3: stuck in the same stocks and bonds market, within the

689
00:34:49,800 --> 00:34:50,719
Speaker 3: same investment world.

690
00:34:50,719 --> 00:34:52,680
Speaker 1: So you might find there's a lot of duplication already.

691
00:34:52,840 --> 00:34:55,120
Speaker 3: If that is the case, then it might be okay

692
00:34:55,200 --> 00:34:57,040
Speaker 3: to simply pick the one that serves you the best,

693
00:34:57,040 --> 00:34:59,960
Speaker 3: that you have the strongest relationship, and consolidate all those assis.

694
00:35:00,040 --> 00:35:00,640
Speaker 1: It's into one.

695
00:35:00,760 --> 00:35:03,200
Speaker 3: The important thing is that you've got the ownership structure,

696
00:35:03,239 --> 00:35:06,080
Speaker 3: the taxation structure. It sounds like that you need. Now

697
00:35:06,080 --> 00:35:08,120
Speaker 3: you're just literally, to use your words, you're just trying

698
00:35:08,120 --> 00:35:11,759
Speaker 3: to simplify. So just be sure you are actually benefiting

699
00:35:12,200 --> 00:35:14,520
Speaker 3: from the fact that you've got multiple institutions in the

700
00:35:14,520 --> 00:35:16,360
Speaker 3: mix there. If you don't, if you don't feel like

701
00:35:16,360 --> 00:35:18,680
Speaker 3: you're benefiting, then yeah, pick a good one and consolidate.

702
00:35:19,480 --> 00:35:21,640
Speaker 3: Mark and Green Hills. Bob Mark says they have an

703
00:35:21,719 --> 00:35:24,080
Speaker 3: estate plan. But it was written when their kids were little,

704
00:35:24,080 --> 00:35:26,040
Speaker 3: and now that those kids are growing and on their own,

705
00:35:26,680 --> 00:35:28,680
Speaker 3: they've got one that's good, pretty good with money, in the.

706
00:35:28,600 --> 00:35:29,919
Speaker 1: Other one maybe not so much.

707
00:35:29,920 --> 00:35:32,800
Speaker 3: So how do they update things without creating any resentment

708
00:35:32,840 --> 00:35:34,480
Speaker 3: between the two? What are some steps they can take

709
00:35:34,480 --> 00:35:35,960
Speaker 3: to handle that kind of situation?

710
00:35:36,960 --> 00:35:39,560
Speaker 1: Well, Mark, first of all, it's always great to talk

711
00:35:39,600 --> 00:35:44,400
Speaker 1: to a fellow pioneer. Go Greenhills Pioneers. In reference to

712
00:35:44,440 --> 00:35:49,959
Speaker 1: your question, green Hills means Johnny's Toys to me, that's well,

713
00:35:50,600 --> 00:35:54,280
Speaker 1: and hey, God blessed Johnny's toys in the Green Hills pool.

714
00:35:54,320 --> 00:35:58,640
Speaker 1: How about that? All right? Hey, to Mark's question, you know,

715
00:35:58,719 --> 00:36:01,600
Speaker 1: it's important that you reckongnize this, you know, and you're

716
00:36:01,600 --> 00:36:03,560
Speaker 1: getting on top of it, first of all, and I

717
00:36:03,560 --> 00:36:06,160
Speaker 1: would say you don't. You don't have to treat the

718
00:36:06,239 --> 00:36:10,239
Speaker 1: kids unequally just because one's good with money and the

719
00:36:10,280 --> 00:36:13,279
Speaker 1: others not. You don't have to treat them unequally to

720
00:36:13,840 --> 00:36:16,640
Speaker 1: help them and set them up so they can responsibly

721
00:36:16,719 --> 00:36:19,600
Speaker 1: handle their estate once they inherit it. Here's what I mean.

722
00:36:20,440 --> 00:36:23,280
Speaker 1: If one of the kids, you know, or you're worried

723
00:36:23,320 --> 00:36:25,560
Speaker 1: that they're just not gonna be good with this money.

724
00:36:25,600 --> 00:36:28,160
Speaker 1: They might blow it, they might make some big mistakes.

725
00:36:28,640 --> 00:36:31,760
Speaker 1: This would be a great opportunity to put that child's

726
00:36:31,760 --> 00:36:34,920
Speaker 1: inheritance in a trust. Sit down with a good attorney,

727
00:36:34,960 --> 00:36:37,600
Speaker 1: a good financial advisor, talk through all the pros and

728
00:36:37,680 --> 00:36:41,840
Speaker 1: cons of that and construct a strategy where the assets

729
00:36:41,920 --> 00:36:44,640
Speaker 1: could be protected for that child but they still have

730
00:36:44,760 --> 00:36:48,439
Speaker 1: access to them. And you know that tends to work

731
00:36:48,480 --> 00:36:50,879
Speaker 1: out pretty well in those kind of situations. I hope

732
00:36:50,880 --> 00:36:54,120
Speaker 1: that helps. Coming up next, Brian has his bottom line

733
00:36:54,160 --> 00:36:57,600
Speaker 1: and he's got some prudent advice here to do some

734
00:36:57,960 --> 00:37:02,800
Speaker 1: good proactive fourth quorder tax planning. You're listening to Simply Money,

735
00:37:02,920 --> 00:37:04,920
Speaker 1: is that to buy all Worth Financial on fifty five

736
00:37:05,040 --> 00:37:07,000
Speaker 1: KRC the talk station.

737
00:37:07,920 --> 00:37:10,239
Speaker 7: In order to live your dream doesn't always involve.

738
00:37:09,960 --> 00:37:11,719
Speaker 1: A pay cut, invest your time.

739
00:37:11,840 --> 00:37:14,560
Speaker 7: Yes, sometimes it involves a pay cut to get moving

740
00:37:14,600 --> 00:37:15,440
Speaker 7: and then move.

741
00:37:15,360 --> 00:37:17,080
Speaker 1: Up and invest in your future.

742
00:37:17,160 --> 00:37:19,160
Speaker 7: But I would want a path to make more than

743
00:37:19,160 --> 00:37:21,839
Speaker 7: I made, not less than I made. Dave Ramsey, There's

744
00:37:21,840 --> 00:37:23,280
Speaker 7: a lot of people need help in this world.

745
00:37:23,560 --> 00:37:24,439
Speaker 1: I want you to get clear.

746
00:37:24,480 --> 00:37:26,399
Speaker 7: I want you to spend some time very carefully going

747
00:37:26,440 --> 00:37:29,880
Speaker 7: through what are your talents, what are your passions? What

748
00:37:29,920 --> 00:37:32,800
Speaker 7: are your skills? You know, what is it you value?

749
00:37:33,640 --> 00:37:37,399
Speaker 6: Week Days at seven on fifty five KRZ, the talk

750
00:37:37,440 --> 00:37:39,799
Speaker 6: station ed that is all us we believe home.

751
00:37:40,000 --> 00:37:42,040
Speaker 4: I'm so worried that next month I have to choose

752
00:37:42,080 --> 00:37:44,640
Speaker 4: between groceries for my kids or gas for my car.

753
00:37:44,880 --> 00:37:48,640
Speaker 6: Talk about it here fifty five krs the talk station.

754
00:37:52,360 --> 00:37:54,200
Speaker 1: You're listening to simply money. Is that to buy all

755
00:37:54,239 --> 00:37:57,680
Speaker 1: Worth Financial? I'm Bob Sponseller along with Brian James, and

756
00:37:57,800 --> 00:38:03,080
Speaker 1: tonight Brian shares some good fourth quarter tax planning thoughts.

757
00:38:03,480 --> 00:38:06,400
Speaker 1: What do you have for us tonight, Brian, Well, it's October.

758
00:38:06,400 --> 00:38:09,560
Speaker 3: It's time for pumpkin spice lattes and that pumpkin beer

759
00:38:09,600 --> 00:38:12,000
Speaker 3: that shows up at all the bars everywhere. And it's

760
00:38:12,040 --> 00:38:15,359
Speaker 3: also prime tax strategy season, Bob, especially if you're somebody

761
00:38:15,400 --> 00:38:18,359
Speaker 3: with a significant portfolio or business interest that kind of thing.

762
00:38:18,960 --> 00:38:21,239
Speaker 3: The wealthy don't just file their taxes in April and

763
00:38:21,239 --> 00:38:24,200
Speaker 3: look away. They design them in the fall to dictate

764
00:38:24,239 --> 00:38:26,120
Speaker 3: what it looks like in the spring. So here's the

765
00:38:26,200 --> 00:38:28,600
Speaker 3: kind of things that we talk about here. So in

766
00:38:28,680 --> 00:38:30,840
Speaker 3: Q four you want to be looking for things harvesting

767
00:38:30,880 --> 00:38:33,880
Speaker 3: losses and potentially gains with intention. If you've got some

768
00:38:33,960 --> 00:38:36,759
Speaker 3: positions in your portfolio that lost value this year, well

769
00:38:36,760 --> 00:38:38,640
Speaker 3: that's not the end of the world. We want everything

770
00:38:38,719 --> 00:38:41,160
Speaker 3: to gain. We like paying capital gains taxes because it

771
00:38:41,160 --> 00:38:43,560
Speaker 3: means we had capital gains to begin with. However, life

772
00:38:43,640 --> 00:38:45,719
Speaker 3: doesn't work that way all the time. We lose money

773
00:38:45,760 --> 00:38:47,839
Speaker 3: from time to time. The silver lining is you get

774
00:38:47,840 --> 00:38:50,239
Speaker 3: a tax benefit, so you can liquidate some of those

775
00:38:50,280 --> 00:38:52,680
Speaker 3: positions incur the loss, got to stay out of it

776
00:38:52,719 --> 00:38:55,520
Speaker 3: for thirty days, don't fall into the wash sale rules,

777
00:38:56,120 --> 00:38:58,839
Speaker 3: and you can either take that deduction up to three

778
00:38:58,840 --> 00:39:02,760
Speaker 3: thousand dollars off your ordinary income, or you can sometimes

779
00:39:02,760 --> 00:39:05,280
Speaker 3: this is more important, you can offset some other gains

780
00:39:05,280 --> 00:39:08,280
Speaker 3: somewhere else. So maybe you've got a concentrated position somewhere

781
00:39:08,719 --> 00:39:10,359
Speaker 3: that you've always wanted to get rid of or kind

782
00:39:10,360 --> 00:39:11,920
Speaker 3: of pair back a little bit, but you didn't want

783
00:39:11,920 --> 00:39:13,759
Speaker 3: to pay the taxes. Well you can sell off the

784
00:39:13,920 --> 00:39:16,120
Speaker 3: position that's at a loss and offset the one that's

785
00:39:16,120 --> 00:39:18,560
Speaker 3: at a gain. Fix a couple problems at once without

786
00:39:18,560 --> 00:39:21,799
Speaker 3: paying taxes at all. Another one is just charity. So

787
00:39:22,160 --> 00:39:24,200
Speaker 3: giving is good, but do it strategically. If you do

788
00:39:24,239 --> 00:39:26,080
Speaker 3: it the right way, you can get some tax benefits

789
00:39:26,120 --> 00:39:28,719
Speaker 3: despite the change that came a few years ago when

790
00:39:28,760 --> 00:39:32,319
Speaker 3: we made the standard deduction significantly higher, so you didn't

791
00:39:32,360 --> 00:39:34,160
Speaker 3: have to work as hard for it. So what you

792
00:39:34,239 --> 00:39:38,280
Speaker 3: might consider is, instead of writing checks, donate appreciated stock instead.

793
00:39:38,360 --> 00:39:41,120
Speaker 3: Maybe you've got PNG that grandma and grandpa gave you

794
00:39:41,160 --> 00:39:43,560
Speaker 3: from a bazillion years ago, and it's got a lot

795
00:39:43,600 --> 00:39:46,720
Speaker 3: of really low cost basis, therefore decent capital gains built

796
00:39:46,719 --> 00:39:48,879
Speaker 3: into it. Well, rather than selling it off and paying

797
00:39:48,920 --> 00:39:51,319
Speaker 3: the taxes and writing a check to the charity, give

798
00:39:51,520 --> 00:39:55,000
Speaker 3: the shares directly. That charity will have a brochure with

799
00:39:55,040 --> 00:39:56,920
Speaker 3: their logo on it that's going to have account numbers

800
00:39:56,920 --> 00:39:59,040
Speaker 3: and DTC numbers and all this other stuff. It'll be

801
00:39:59,040 --> 00:40:01,359
Speaker 3: a step by step process to tell you and your

802
00:40:01,400 --> 00:40:03,520
Speaker 3: advisor exactly where there's dollars need to be sent.

803
00:40:03,760 --> 00:40:06,520
Speaker 1: That charity will sell the shares themselves. You will not.

804
00:40:06,960 --> 00:40:08,840
Speaker 3: Charity doesn't pay taxes anyway as long as it's a

805
00:40:08,880 --> 00:40:11,480
Speaker 3: five oh one C three, So therefore money benefits a

806
00:40:11,480 --> 00:40:14,480
Speaker 3: group of people that you want to support. Nobody pays taxes.

807
00:40:14,480 --> 00:40:17,839
Speaker 3: That's generosity with a strategy behind it. So one more,

808
00:40:18,040 --> 00:40:20,600
Speaker 3: let's use these exemptions before they shrink. Now, this doesn't

809
00:40:20,640 --> 00:40:25,000
Speaker 3: affect everybody, but this one is kind of critical. There's

810
00:40:25,040 --> 00:40:28,000
Speaker 3: about thirteen point six million dollars per person that you

811
00:40:28,080 --> 00:40:30,960
Speaker 3: can set up to go to your errors without paying

812
00:40:31,000 --> 00:40:34,520
Speaker 3: any estate taxes. So if you've been considering trust, family gifting,

813
00:40:34,560 --> 00:40:37,720
Speaker 3: those kinds of things, you've got some you've got something

814
00:40:37,719 --> 00:40:39,600
Speaker 3: to think about and sure in terms of making sure

815
00:40:39,600 --> 00:40:42,719
Speaker 3: this is structured properly, because you do need to make

816
00:40:42,760 --> 00:40:45,360
Speaker 3: sure that's a per person setup. So you want to

817
00:40:45,400 --> 00:40:47,320
Speaker 3: make sure you've got those assets spread across you and

818
00:40:47,360 --> 00:40:50,000
Speaker 3: a spouse correctly using trust. Talk to your CPA and

819
00:40:50,040 --> 00:40:52,000
Speaker 3: talk to your attorney one last night.

820
00:40:52,600 --> 00:40:56,040
Speaker 1: Nineteen thousand per person, right, so husband and wife could

821
00:40:56,080 --> 00:40:58,560
Speaker 1: give away thirty eight thousand dollars to anyone they.

822
00:40:58,560 --> 00:41:01,400
Speaker 3: Want annual gifting strategy. Yes, they can do that without

823
00:41:01,480 --> 00:41:04,080
Speaker 3: no harm, no foul. So there's a bunch of things

824
00:41:04,120 --> 00:41:06,200
Speaker 3: to go chase down here in the remaining months of

825
00:41:06,200 --> 00:41:06,560
Speaker 3: this year.

826
00:41:06,600 --> 00:41:09,040
Speaker 1: Thanks for listening tonight. You've been listening to Simply Money,

827
00:41:09,040 --> 00:41:12,120
Speaker 1: presented by all Worth Financial on fifty five KRC the

828
00:41:12,440 --> 00:41:13,000
Speaker 1: talk station.

829
00:41:14,480 --> 00:41:17,520
Speaker 6: I'm super grateful that I was able to leave him.

830
00:41:17,280 --> 00:41:19,160
Speaker 7: Financially giving thanks.

831
00:41:19,600 --> 00:41:22,000
Speaker 1: It wasn't a good situation for me and my kids,

832
00:41:21,840 --> 00:41:23,759
Speaker 1: and I just have you to think for that.

833
00:41:24,120 --> 00:41:26,440
Speaker 6: For all the advice I feel myself, I wasn't going

834
00:41:26,480 --> 00:41:27,120
Speaker 6: to cry, and.

835
00:41:27,080 --> 00:41:29,040
Speaker 1: The guidance to make good decisions.

836
00:41:29,160 --> 00:41:31,200
Speaker 7: You got control of your life and I gave you choices.

837
00:41:31,280 --> 00:41:33,040
Speaker 1: I'm proud of the Ramsey Show.

838
00:41:33,200 --> 00:41:36,640
Speaker 4: It's definitely hard to get started, but once you get going,

839
00:41:36,719 --> 00:41:39,279
Speaker 4: it's super duper easy to pack your lunch every day

840
00:41:39,320 --> 00:41:43,000
Speaker 6: And not drink Starbucks weekdays at seven on fifty five KRC,

841
00:41:43,600 --> 00:41:44,520
Speaker 6: the talk station,