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Category: Podcast

Ep. 52: The Sandwich Generation: Planning for Retirement, Juggling College Funding, and Caring for Aging Parents with Jeff McDermott

Are you approaching retirement while juggling paying for your kids’ college, or even perhaps caring for aging parents?  You are not alone.  In fact, 48% of adults are providing some sort of financial support to their grown children, while 27% are their primary support. Additionally, 25% are financially supporting their parents as well.  

The conversation focuses on the sandwich generation, which refers to individuals who are planning for their own retirement while also supporting their children and aging parents.  In this conversation, Kevin Lao and Jeff McDermott discuss various financial planning topics, including college planning, retirement savings, and caring for aging parents. They emphasize the importance of balancing saving for college and retirement, taking advantage of catch-up contributions after age 50, and having open conversations about estate planning and long-term care. They also highlight the benefits of using 529 plans, taxable brokerage accounts, Health Savings Accounts, and more. 

I hope you enjoy this episode!

-Kevin 

Connect with me here:

  • ⁠⁠Join My Company Newsletter⁠⁠

Links referenced:

  • Forbes Article: The ‘Sandwich Generation’ Is Financially Taking Care Of Their Parents, Kids And Themselves
  • Jeff McDermott on IG
  • CreateWealthFP.com
  • Whiteboard Fireside Chat: You are 50+ and want to catch up for retirement
  • Whiteboard Fireside Chat: The different types of permanent life insurance
  • SECURE Act 2.0 529 Rollover Rules

Are you interested in working with me 1 on 1?⁠⁠ 

⁠⁠Click this link to fill out our Retirement Readiness Survey

Ep. 51: Artificial Intelligence & Bitcoin: Should these Emerging Technologies Have a Place in Your Investment Portfolio? (w/Brian Bonewitz, CFA)

Are you approaching retirement and worried about the impact of Artificial Intelligence (AI) on the future of your job?  What about the impact of AI on the financial markets?  And lastly, do Bitcoin and other cryptocurrencies have a place in a well-diversified investment portfolio?

I hope you enjoy my interview with Brian Bonewitz.  Brian is an AI consultant, CFA holder, and has a unique perspective on AI, digital assets, and the impact they have on investing for retirement.

Personally, I believe the mainstreaming of Bitcoin in 2024 is likely to cap some of the upside potential, but also it reduces the downsize given some of the world’s largest asset managers are now substantial stakeholders in crypto assets.

To each their own, but I believe a decision should be made one way or the other, and likely sooner rather than later.

-Kevin Lao

Connect with me here:

  • ⁠Join My Company Newsletter⁠

Links Referenced in Episode:

  • ⁠⁠The godfather of AI sound alarm about potential dangers of AI
  • Digital Assets (IRS website)
  • 6 Things to know about Wash-Sale Rules
  • Michael Saylor on Bitcoin
  • Coinbase
  • Brian Bonewitz on Linkedin
  • Rafa.ai

⁠⁠⁠⁠Are you interested in working with me 1 on 1?⁠ 

⁠Click this link to fill out our Retirement Readiness Survey

Ep 50: 50 Truths Retirees Wish They Knew Before Firing Their Boss

Do you ever wish you could get inside the minds of existing retirees to ask them what their experience has been?  Or, ask them what they wish they would have known before they quit their day job?  This episode is for you!

In this episode of the Planning for Retirement podcast, I’ll share 50 truths that retirees wish they knew before they quit their day jobs.  Some of these are straight from the horse’s mouth, some are my observations in serving retirees for more than a decade, and some are research-based that I uncovered during this process. 

I’ll cover a range of topics including finding purpose in retirement, the misconception of retirement expenses going down, the importance of exercise and brain stimulation, the high costs of healthcare in retirement, tax traps, and much more. 

Thanks for tuning in!  Make sure to subscribe to give me a follow on social media and company newsletter below.  We’re also getting the YouTube side of things going and I’ll be posting one offs in bet

Connect with me here:

  • YouTube

  • Join My Company Newsletter

Links Referenced in Episode:

  • ⁠ 50 Truths Retirees Wish They Knew Before They Quit Their Day Job
  • ⁠Purpose and Successful Retirement Transition Questionnaire⁠
  • Shocks and the Unexpected:  An Important Factor in Retirement 
  • The life expectancy of older couples and surviving spouses 
  • How to plan for rising healthcare costs

⁠⁠⁠Are you interested in working with me 1 on 1? 
Click this link to fill out our Retirement Readiness Survey 

Or, visit my website

Ep 49: Vol 1 of “Whiteboard Retirement Plan” – Should I Retire with $1.5mm Invested at Age 65?

Welcome to this edition of The Planning for Retirement Podcast.  This is Volume 1 of this new series, The Whiteboard Retirement Plan, where Kevin breaks down a real-life client case for “Bob and Jennifer” in plain English.  The goal is to help answer the question, “Can I fire my boss?”  

ERROR IN THE VIDEO

***Hey all, just a quick note about this episode. In minute 22:47, I mentioned the spousal benefit Jennifer would collect would equate to $18k/year. However, this is not the case.

Because Jennifer filed her OWN benefit early, she would also have a lower benefit even after Bob collects his benefit at 70 and she is eligible for the spousal benefit. This includes the $12k she would receive, plus a $6k “top off” to get to the full $18k/year she would be eligible for.

For Jennifer’s claiming strategy on her own record with a PIA of $12,000/year (assuming she started at 67). If she started at 62, this would equate to a 30% total reduction from her PIA of $12,000. This reduced amount would be $8,400/year.

The $8,400 continues for life, but once Bob claims his benefit at 70, she is then eligible for the maximum $6k “top off” I mentioned earlier. This would give her a total benefit of $14,400/year, not $18k/year.

Thanks for catching that one, Roberto! Here is a link to an article you might find helpful:

https://maximizemysocialsecurity.com/can-i-start-collecting-my-own-benefits-age-62-and-then-switch-spousal-benefit-age-67

Back to the action***

He discusses the savings rate, income sources, and withdrawal rate, highlighting the need for adjustments and planning opportunities.

The episode ends with a discussion on the impact of early Social Security claiming and survivor benefits.

Bob and Jennifer are in a good position to retire, but there are some risks they need to address.

Long-term care planning is important, as 70% of people over 65 will need some form of long-term care. They should consider whether to self-fund or get long-term care insurance.

Tax planning is also crucial, as 80% of their assets are in tax-deferred accounts. They should explore Roth conversions to minimize taxes and leave a financial legacy to their children.

Finding purpose in retirement is essential, and they should consider how to spend their free time to maximize their life experiences with their loved ones.

Lastly, they need to have an optimized investment strategy to spin off income for the rest of their lives, while at the same time address a potential bear market or recession.  

Takeaways

  • Diversification is crucial in investment portfolios to mitigate the risk of selling the wrong thing at the wrong time.
  • Interest rate cuts by the Fed can impact the stock market and the economy, but volatility and corrections are normal in investing.
  • The Whiteboard Retirement Plan is a straightforward analysis on whether or not a client can fire their boss and retire comfortably.  
  • Early Social Security claiming can result in reduced benefits, affecting both the retiree and potential survivor benefits.  However, in some cases you may consider collecting early to offset a high rate of withdrawal on investments.  
  • Adjustments to your plan are necessary to ensure a sustainable retirement income. 

Links

Social Media:

Retirement Readiness Survey

Ep 48 – “Downsizing” to Retire Early

In this episode, Kevin discusses the topic of downsizing to retire early.

He shares the reasons why people downsize their homes to fund their retirement and talks about the tax implications of doing so.

Takeaways:

Downsizing to a smaller home can help fund retirement and allow for an earlier retirement. Home equity can be a valuable asset to consider when planning for retirement.

Consulting with financial and tax professionals is crucial to understand the tax implications of downsizing.

Social media algorithms can shape people’s opinions and contribute to the perception of a divided society.

Considering the emotional attachment to a home when downsizing is important, but it’s essential to consider financial goals and retirement plans.

Chapters Introduction and Overview:

The Influence of Social Media Algorithms

Emotional Attachment and Financial Goals in Downsizing

Tax Implications of Downsizing

Maximizing Home Equity for Retirement

Social Media:

⁠Facebook ⁠

⁠LinkedIn ⁠

⁠Instagram⁠

Referenced in Episode:

⁠How to keep most (if not all) of your home sale profits tax-free!

⁠Are you interested in working with me 1 on 1?  Fill out our Retirement Readiness Survey

Ep. 47 – Should You Relocate in Retirement?

It’s official, we moved to Chattanooga, Tennessee where my wife’s family is from.  Considering this big move and the fact that I’ve spoken with hundreds of retirees who relocated during retirement, I thought this would be a timely topic!  

I’ll unpack some of the main reasons I see people relocating during retirement including;

  • the weather
  • lower cost of living
  • lower taxes
  • healthcare
  • family
  • politics. 

The reasons I hear are good ones, but make sure you find a tight-knit community.  Every study I read on this topic points to a close social community being vital to maintaining health and happiness during your golden years.  

I will also encourage listeners to be open to the possibility of change and to prioritize their physical, mental, and financial health in retirement.  Nothing has to be “set in stone” in terms of where you move initially.  You can always “try it out” and decide on the long-term plan after a year or two.  

Takeaways

  • Relocating in retirement can offer opportunities for a change in lifestyle and a lower cost of living.
  • Factors to consider when deciding to relocate include the weather, lower taxes, healthcare options, proximity to family, and political climate.
  • It’s important to build a sense of community and find like-minded peers in the chosen location.
  • Relocating doesn’t have to be permanent, and it’s okay to try out different areas before making a final decision.
  • Prioritize your physical, mental, and financial health in retirement.

Links

Social Media:

Referenced in Episode:

  • AARP Article – Reasons to relocate
  • Smart Asset article – Best states to retire for taxes

Are you interested in working with me 1 on 1?  Fill out our Retirement Readiness Survey

Ep. 46 – Should I “Die with Zero?”

In this episode, Kevin Lao discusses the key takeaways from the book ‘Die with Zero’ by Bill Perkins.

He emphasizes the importance of using money as a resource and not hoarding it. He also talks about the concept of return on experiences and the different life phases for different experiences.

Kevin highlights the significance of investing in one’s health and giving with a warm hand instead of a cold one.

He also mentions the Life Cycle Hypothesis and the importance of insurance products in mitigating financial risks.

Lastly, he discusses the potential drawbacks of enabling children and the importance of open communication when giving money.

Takeaways

  • Money should be used as a resource and not hoarded.
  • Invest in experiences and prioritize return on experiences.
  • Consider the different life phases for different experiences.
  • Invest in your health to enjoy retirement fully.
  • Give with a warm hand instead of a cold one and consider the impact of timing.
  • Evaluate insurance products to mitigate financial risks.
  • Be cautious about enabling children and have open communication about money.
  • Customize your financial plan based on your unique circumstances and objectives.

Chapters

  • 00:00 Introduction and Mission of the Podcast
  • 02:26 Recommendation of the Book ‘Die with Zero’
  • 04:29 Using Money as a Resource
  • 07:43 Prioritizing Return on Experiences
  • 11:10 Different Life Phases for Different Experiences
  • 14:01 Investing in Your Health
  • 16:14 Giving with a Warm Hand
  • 26:49 The Role of Insurance Products in Retirement Planning

Links

Social Media 

Facebook 

https://www.facebook.com/KevinLaoCFP/ 

LinkedIn 

https://www.linkedin.com/in/kevin-lao-cfp%C2%AE-ricp%C2%AE-4181a29/

Instagram

https://www.instagram.com/imaginefinancialsecurity/

Retirement Readiness Survey 

Living to 100:  https://www.livingto100.com/

Die With Zero book:  https://www.diewithzerobook.com/welcome

Ep. 45 – Should I Invest in my Company Stock?

You can invest in your company stock in several ways, whether you are working for a publicly traded corporation or even a privately owned company.  

And who wouldn’t want to have ownership in the company you have your sweat equity with?  

However, there are tax implications and investment risks you must weigh before moving forward with doing so.  And even if/when you decide to invest in your company’s stock, you must have a plan and process to ensure you are not taking on unnecessary risk.  

In this episode, we’ll cover:

  • the different ways you can invest in your company stock
  • the tax implications of each strategy 
  • we’ll cover why investors are often so concentrated in their own company’s stock
  • and we’ll talk about some planning strategies along the way to help reduce unnecessary risk

Connect:

Links referenced throughout this episode:

Ways to invest in your company stock

https://finance.yahoo.com/news/invest-own-company-stock-160142745.html

RSU vs. ESOP

https://www.moneycontrol.com/news/business/personal-finance/mc-explains-how-is-an-esop-different-from-rsu-and-espp-9779721.html

The risk and underperformance of concentrated stock positions

https://www.fa-mag.com/news/the-risk-and-underperformance-of-concentrated-stock-positions-78253.html?section=68&utm_source=FA+Magazine&utm_campaign=3dd4479fde-FAN_AM_John+Hancock_060324&utm_medium=email&utm_term=0_-4b692acec9-%5BLIST_EMAIL_ID%5D

Excessive Extrapolation and the Allocation of 401(k) Accounts to Company Stock

https://www.anderson.ucla.edu/faculty/shlomo.benartzi/excessive.pdf

If you are interested in working with me 1×1, start by filling out our Retirement Readiness Survey below.  I’ll follow up with feedback on how you are tracking towards your goals, as well as how we can help you in your journey to financial independence.  

Take The Retirement Readiness Survey

Thanks for tuning in and hope you enjoyed this episode.  

-Kevin Lao

Ep. 44 – How Much Will I Spend in Retirement?

Thanks everyone for tuning in! 

As we continue our review season with clients, it’s a friendly reminder of how important a retirement spending budget is!  This is a key input your financial advisor must know to run accurate projections for you.  Remember, the outputs are only as good as the inputs.  

In our last episode, we talked about how important an assumed retirement age is.  This week, we will focus on projecting how much you’ll spend in retirement.    

This is a very personal question that is tough to fit into a “rule of thumb.”  However, I’ll focus on discussing a few rules of thumb and ways you can project an accurate spending number.  From there, we’ll talk a bit about some research in retirement spending phases and how that will impact your projections.  

And finally, I’ll talk about some of my observations on retiree spending patterns based on my years of practice.      

I hope you enjoy today’s episode.  Make sure to give us a follow if you’re interested in how to plan for retirement.    

Connect:

Articles:

Exploring the Retirement Consumption Puzzle

How much does the average 65+-year-old retiree spend?

https://www.gobankingrates.com/retirement/planning/how-much-the-average-65-year-old-retiree-spends-monthly/?utm_term=incontent_link_8&utm_campaign=1264931&utm_source=yahoo.com&utm_content=11&utm_medium=rss

Are you interested in working with us?
Fill out our “Retirement Readiness Survey” and we’ll follow up with some feedback on how you’re tracking for your goals and how we could help.

Ep. 43 – Stop Planning for a “Normal” Retirement Age

Two of our recent client meetings were with folks who retired much earlier than they had anticipated.

So, I started to go down a rabbit hole of research and thought this would be a great episode to encourage you all to STOP planning for a “normal” retirement age in your assumptions!

Even if you do end up working until 65 or 70, you should not build that into your calculations when planning for retirement.  Instead, whatever you think your expected retirement date is, push it forward 5 years.  So if you want to work until 60, push it to 55.  If you want to work until 70, push it to 65.  

The point is, that you cannot control what you cannot control.  

It then got me thinking about assumptions for retirement planning. And how the inputs/assumptions we, as financial planners, put into the calculations make a huge difference.

So, what I thought I would do for the next several episodes is go through each of those inputs (retirement age, retirement spending, inflation, longevity, investment returns, and taxes) to coach you through some of those important considerations before making certain assumptions.  Also, to point out mistakes that I’ve seen in my career practicing retirement planning.  

I hope you enjoy this episode, the FIRST-ever time we are publishing a video recording! (*Welcome to 2024 😁)

Thanks for tuning in.

-Kevin Lao

Sources:

USA Today Article – Most Americans Retire Earlier Than Expected

Connect:

Are you interested in working with us? Fill out our “Retirement Readiness Survey” and we’ll follow up with some feedback on how you’re tracking for your goals and how we could help.

[email protected]
(904) 323-2069

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