No Pension? No Problem: How to Create Your Own Retirement Paycheck

TPIR Ep 117 Full Show.mp3: Audio automatically transcribed by Sonix

TPIR Ep 117 Full Show.mp3: this mp3 audio file was automatically transcribed by Sonix with the best speech-to-text algorithms. This transcript may contain errors.

Speaker 1:
Any examples used are for illustrative purposes only and do not take into account your particular investment objectives, financial situation or needs and may not be suitable for all investors. It is not intended to predict the performance of any specific investment, and is not a solicitation or recommendation of any investment strategy.

Speaker 2:
Welcome to Take Pride in Retirement, the podcast dedicated to helping members of the Lgbtq+ community protect and grow their hard earned money. Get set for a show full of education and insights with your host and advisor, Matt McClure. We recognize every family is unique. The goal of the show is to help you achieve financial freedom, so you and your loved ones can have the retirement you've always dreamed of, a retirement you can take pride in. No matter who you are, where you're from, or who you love. So now let's start the show. Here's Matt McClure.

Speaker 1:
Well hello there. Welcome to another edition of Take Pride in retirement. Matt McClure here with you, your host, your advisor, your friend, your pal, and your confidant. Thanks so much for being a part of things, as always.

Speaker 2:
And I am Josh Rhett Noble, the attache to the advisor, aka co-host, aka Matt's husband.

Speaker 1:
He is all of those things. And today we're going to be talking about something that a lot of people, I think, wish that they had and wish that they knew more about, but most don't either have one or know anything about them really. And that is a pension.

Speaker 2:
Yeah. Pensions feel like something our parents or grandparents had, right? It's not something that people our age can count on.

Speaker 1:
Yeah, it's absolutely right. And there is good news, though, that just because pensions are rare does not mean that you can't create your own. So we're going to talk about that all throughout the show today. First of all, before we get too deep into it, though, I do want to say thank you for watching, for listening, for subscribing. That's your.

Speaker 2:
Subscribe. Sorry, I always had my little tune. I was just like listening. You're like, oh yeah, you talk to those people that I know.

Speaker 1:
I changed it up a little bit today. I was trying to catch you off guard there. Um, but, uh, no, that's, uh, it would be wonderful if you would do that. Um, wherever you get your podcasts, please subscribe there, leave us a rating and a comment. We'd love it. Also, um, wherever you, uh, go on your, your YouTube, which is usually the YouTube app or youtube.com. Uh, please subscribe like the video, um, you know, subscribe to the channel, leave comments, all those things, send it to friends, uh, you know, spread the word about, you know, the way that we are going about spreading information about how you as an LGBTQ person or ally or whomever deserve a retirement you can take pride in no matter what, no matter who you are, where you come from, who you love, how you identify, how much money you have, any of those things you deserve a retirement you can take pride in. You can also go to the website, take pride in retirement.com. You can give me a call 85524692118552469211 is the number, and free consultation is what you can get. Um, you know, deep dive into your financial situation and see if we can make that better. That is the goal. All right. So today we're going to walk through how to create a personal pension for yourself and using something called an annuity to do that and or multiple annuities, perhaps if that's correct and right for your situation and how you can create a personal pension using that. So especially important for Lgbtq+ couples and individuals who may not have those sort of traditional safety nets in life, right?

Speaker 2:
Yeah. And I mean, like, I want to start too with Matt is like, why a personal pension matters more than ever right now. And so with that idea, like, why is this idea of a personal pension such a big deal right now, right this moment?

Speaker 1:
Yeah. Well, one right now, there's so much uncertainty, economic uncertainty, global uncertainty with, you know, wars overseas and that kind of thing. And so that creates a lot of turmoil in the markets. Naturally, it creates a lot of turmoil in people's everyday lives and creates inflation, especially among energy prices. I have got to once I once I leave the office here and head home, I've got to stop and get gas and I'm not looking forward to it. So, um, that's not going to be a pleasant experience. So that's one of the things that really, or one of the kind of overall concepts that makes it super important right now, because annuities do offer safety from that market risk. And also most people today don't have any kind of pension, especially a pension that was, um, you know, sponsored by an employer. Right. I mean, you used to, uh, it used to be the norm, uh, back a few decades ago, you would, uh, work for 30, 40 years for a company, you'd retire, they'd give you the gold watch and the pension and send you along your way. And that pension is a lifetime income, right? And so that that was the company's promise to you as one of the benefits of working for that company. But now they've been replaced by 401 S, four O, three B's other type of employer, employer and employer sponsored plans. Easy for me to say. And IRAs, which are individual retirement accounts as well. And so that shifts the responsibility from the employer to you. And it shifts the risk from the employer to you as well. And so the real question here for you, now that you know that the responsibility is yours, is not how much do I have saved or how much have I have my investments grown or whatever the situation might be? It's how do I actually take that big amount and turn it into income?

Speaker 2:
Yeah. So it's not just about having a big number. It's about making that number last.

Speaker 1:
Oh yeah. Yeah, that's exactly right. I mean, retirement is um, it's an income problem. It's not just a savings or investment problem, right? You, you need to have a plan for your retirement income, and you need to have a plan to make sure that you're not going to outlive that income as well. Super important. And actually on our next episode, we're going to talk about that. So, you know, it's almost like I planned, uh, teeing that up here. Uh, but so tune in for that. But you know, for LGBTQ plus folks, you also might be, um, more likely to be single later in life, um, less likely to have children as a support system, more reliant on your own financial strategy rather than having, like I was saying, you know, earlier, that sort of traditional safety net that people might have that others might have. And so if you can get a guaranteed income, um, and have that income be there for the rest of your life, that gives you so much peace of mind. And if you are not sure you know what your retirement income picture looks like, then that's where I can step in and help. Just go to take pride in retirement.com, take pride in retirement.com or reach out at, uh, the phone number 55. Two. Four. Six. 92. 11. Eight. Five. Five. Two. Four. Six. Nine. Two. One. One. And if you are watching this on the old YouTube machine, uh, that'll be scrolling across the bottom of the screen the entire episode.

Speaker 1:
So you've got plenty of opportunities to write that down. Um, but yeah, I mean, you start that conversation, it all starts with a, with a free consultation, don't charge you a thing. There's no obligation for it. And, uh, the peace of mind that you can potentially get means a whole heck of a lot. And I always say every episode, Matt is the advisor that cares. So he's going to have your best interest at heart no matter what that may be, because everyone's situation is going to be different. And that's what's great about having Matt on your side. He'll figure out what is going to help you. Yeah, that is definitely the goal. Um all right. So let's, uh, let's kind of get into, you know, what an annuity actually is here. Yeah. So when people hear annuity, I feel like they either don't understand it or they've heard something negative about it. I think that's right. I mean, annuities are one of the most misunderstood tools in in the financial world, I believe. Um, and at its core, I mean, really, when it comes right down to it, an annuity is a contract. It's a contract between you and an insurance company, usually a life insurance company or, you know, a life and annuity company or just a company that does only annuities and you put your money in it in most cases will grow at a particular rate, whether that's a guaranteed rate, like a regular fixed annuity or a myga will go through the types here in a minute, but it'll grow at a particular rate.

Speaker 1:
And then you can generate a guaranteed income for life on the other side whenever you elect to do that. And so you can think of it as a way to kind of rebuild a pension like income stream for yourself. Yeah. So it's basically you're, you're paying yourself a paycheck while in retirement. Yeah. It's one. And that concept is one of the most, um, I guess just weird mental things for people, for clients of mine who have retired to sort of wrap their minds around is I've been working all this time and I've been having this income and all of that that I could count on through my job and everything. And then I turned that corner into retirement. Suddenly I don't have that job anymore. And that income, what in the world am I going to do? It just feels really weird. And so yeah, this is one of those ways to sort of replace that paycheck in your retirement years. It provides that stable monthly income. It can last as long as you do. You know, it's not going to be something that you outlive. And in some cases, it can cover both spouses or partners as well.

Speaker 1:
It depends on how you want to structure it and what makes the most sense for you. And, um, yeah, there are just a lot of different options for how you can get paid out through it. Yeah. And I mean, I feel that that last part is really important because especially for couples who may be relying on each other financially. Yeah, that's absolutely right. I mean, survivor benefits and spousal benefits, income continuation, all those things are key, especially if one partner maybe has significantly more savings or income. Annuities can really help protect that surviving partner from any sort of financial disruption through, you know, either both being, you know, jointly on the annuity to begin with or the, you know, through a death benefit rider on, on that. So the surviving spouse would receive a lump sum in that case. So like I said, you got your options. Yeah. Well, let's talk about type of annuities, right? So and what you actually recommend, because they're not all the same. So I want you, if you can walk us through the main types without getting too into the weeds, like to talk to me like I'm five years old. That's what I say. Tell it to me like I'm five. I'm like, I don't know anything. Yeah, right. Well, well, to keep it simple, to keep it practical here, um, one of the types of annuities that we normally recommend in, in a lot of cases, it depends.

Speaker 1:
But this is one of the more common that that I'll recommend is called a fixed indexed annuity. What it does is it provides protection of the principal. So you would put in a lump sum, right. It protects that. So you don't lose the money due to a market downturn. But the reason the word indexed is in there is because it's tied to a particular market index. So on the upside, it offers growth that's tied to something like the S&P 500, for example, or maybe the Nasdaq or some sort of proprietary index that a bank might have or another financial institution. And that can include things like, you know, income riders for people who want that lifetime income. And if you want potential to the potential to get market like growth, but without the market risk, this is often a strong fit for you. And it really is the closer you get to retirement. I find a lot of people really want that to take a lot of that risk off the table, but still get growth. Yeah. So that's sort of the middle ground. So it's not super aggressive and it's not super conservative. It's just right. Right. It's like it's the Goldilocks right there as far as I'm concerned anyway. Depending on the person, it could be just right. Right. Exactly. And that's important because as we always say, everybody's situation is different. It's one of the reasons I do this show is because everybody's situation is different, and I want to try and cover as much ground as I possibly can here.

Speaker 1:
But when you go to take pride in retirement.com, you sign up for that initial consultation. Um, I will be glad to go through your individual situation with a fine tooth comb and see what is right for you. Um, so that's like, you know, the fixed indexed annuity side of things. Number two here, uh, type of annuity that we'll talk about is a Miga, which is a multi year guaranteed annuity. So MYGA multi year guaranteed annuity in the, in the biz, we call it omega. You can also think of a fixed annuity. Uh, because omega really is kind of a type of a fixed annuity. Um, but these are kind of like bank CD alternatives really. Um, they generally, especially lately have been giving higher returns than a bank CD, depending on your bank and the situation and all that, of course, but there's a fixed interest rate for a set number of years. They're very predictable and they are very stable. So these are maybe that more conservative type option. So my God. Sorry. My God. Talking back. Sorry. So anyway, this is better for like a short shorter term planning or this kind of parking money safely. Yeah, exactly. I mean, especially, you know, if you want that guaranteed growth, you know, you go, you know, right there in the contract, this is how much interest I'm going to earn over however long the contract is.

Speaker 1:
Um, if you're getting super close to retirement and you don't want, um, you know, and you're one of those people, you want to take as much risk off the table as possible. You want more guarantees. You want to see in black and white on the page what I'm going to have, then this is something for you. Or, you know, if you're waiting to maybe take income from that a little bit later on, you could do something like a longer term fixed annuity. A lot of those might offer a higher interest rate for that commitment of a longer period of time. So, um, yeah, it's again more and more options here. Another one kind of the other end of the spectrum. So that's when we're talking about migas and fixed annuities. Those are kind of the more conservative, right. But at the other end of the spectrum is the variable annuity. These are more market based. There will be some sort of safety nets and things written into the contract, but the investments are actually in the market. They're within buckets that are based in the market. So they're higher risk. They can be really complex. And in most cases, I don't really recommend those to people. Um, you know, especially people who are trying to create that sort of stable income.

Speaker 3:
So if the goal is a pension like paycheck, then this ain't the one.

Speaker 1:
Right? Right. I mean, it's, it's, um, there's still that risk there. There's still that market risk. And so, you know, go with one of the others, maybe to one, if you want to take that risk off the table, but, you know, a variable annuity. I'm not saying it's not right for anybody out there, but they tend to have higher fees and the risk is still there and all that stuff. So it's it's one that you want to be careful about. And generally speaking, not one that I recommend here. Yeah. Well, this is all great. However, how does anyone actually figure out how much income they actually need? So how do how do you know what you actually need? Important important step. Of course, you start number one with your monthly expenses, you got to factor in all of these things like your housing, your healthcare, your lifestyle, all of the different pieces of that puzzle. And then you look at any existing income sources, obviously Social Security, any like if you have a part time job, maybe in your retirement years or something like that, or if you've got a rental property that's generating income, whatever your situation might be, an existing income sources as well. So then you've got to sort of bridge that gap, right? If there's a gap between what you're bringing in and those, you know, expenses that you have, the big ones, especially the housing, the health care, all the different things that you want to do, your, your lifestyle that you lead.

Speaker 1:
Um, you want to identify that gap. And then the goal is to fill that gap, that personal pension can, can fill that gap or bridge that gap for you. So you're basically filling in this missing piece. Yeah. It's like a, it's like a puzzle that's got a piece missing out of out of it right in the middle, you know, and you want to make that pretty little picture. And, you know, we're not replacing everything with annuities. I'm don't mean to say that ever. It's like it is one piece of the puzzle as we, you know, approach your overall plan. We're strategically using them to create this foundation of guaranteed income for you. And again, for Lgbtq+ folks, super important if you don't have that family support, if you are concerned about long term care and who's going to care for you in your later years if you need long term care, and most of us will, at some point in our lives need some sort of long term care. Um, and so, you know, a lot of these annuities will have long term care riders where they will like double your income. For example, if you are having to go into a long term care situation, or they'll give you a lump sum to be able to pay for that. And, you know, if you want financial independence, no matter what happens as an LGBTQ plus person, that is super important and it can give you a lot of peace of mind.

Speaker 1:
Yeah. So let's talk about choosing the right company because that feels like a big deal. Oh yeah, it does. And you know, you want to, and I only go with when I am sitting meeting the clients and I'm recommending annuities. I am only recommending ones from strong companies. You know, you want to go with those financially strong insurers. You look for high ratings from organizations that that go in and look at the financial stability of these companies. And am best is one of those that will rate companies. And I only like to go with those that are, you know, like a, a plus rated type carriers and longer track records, those that have been around for a good long while. Um, you know, these companies are names that you would recognize and have probably seen them advertising other things on TV from another part of their business or heard the ads on the radio or whatever. But, you know, at the end of the day, the, the guarantee of the, you know, part of the guaranteed income piece and guarantee principal protection and all that is only as strong as the company that's backing it. And so that's why I only go with the strongest. So this isn't where you just pick something randomly online.

Speaker 1:
No, it's not like you, you know, you put them, uh, like a all up on the wall, a bunch of different names of companies and annuities. And then you just like throw a dart at it and whichever one it lands on. Now that's, that is absolutely not. This is we're working with somebody who understands the landscape here is really, really critical because you want if the goal is more safety, you want that money to actually be safe, right? So take pride in retirement.com. I would love to help you out. And again, this sounds like something you shouldn't try DIY. No, you need someone like Matt. Yes, there are certain things and Josh knows this. There are certain things that I can DIY. Actually quite a few things that I can DIY. I've done, you know, my. Our friend came and helped me and basically taught me how to tile a floor and like, you know, I've done a lot of paint jobs and, and, um, you know, other things putting down other types of flooring as well, like LVP and all this stuff and just repairs around the house. There are some like if I was, somebody asked me to build a porch on the back of their house, I would have no clue. So, you know, this is like the building of the porch. Um, you can, you could try, you know, to do that yourself, but you may fall through the porch.

Speaker 1:
So same thing here. I mean, annuities do have moving parts. Um, different products have different purposes. There are different things that go into it timing structure, income options, all of that matters, and a licensed advisor like myself can help match the right product with your goals, with your needs, with your situation, and avoid those unnecessary fees, the unnecessary complexity of things, and build it all into a full retirement plan so you don't have just one. You know, this one sort of annuity hanging out over here that's not working in tandem with the rest of your stuff. Because again, the annuity is not the entire picture. It's a part of the overall picture. Yeah. So bottom line with all of this, this is really about creating stability in retirement. 100%. I mean it's a personal pension through an annuity. And it can give you predictable income. It can give you protection against market volatility when it's still, you know, in in growth mode before it goes into income mode when you decide. And then it can really the most important thing is it can give you peace of mind. And so for many people in the LGBTQ plus community, especially that, you know, independence, that certainty, it really is everything. And so if you want to find out what your personal pension could look like, I would love to sit down with you.

Speaker 1:
I'll get to know your goals, your retirement lifestyle that you're working toward. Evaluate your current savings, investments, etc., your income sources, all of that, and then identify any gaps in your plan, especially that income gap we talked about. I'll show you how tools like annuities can help create guaranteed income. I'll also look over your investments and see if we can reallocate those to get you a better outcome. And then I'll answer all your questions, as many as you have, so you can really be confident about your plan, about your your new plan. And it all starts with that simple conversation. And you start that conversation by going to take pride in retirement.com. Click on the contact page there or the Get Your plan button right at the top right hand corner of the screen, and you can get in touch with me. It's absolutely free. You can also give me a call 24692118552469211. Is that number awesome. Well, this has been, uh, clarifying in a lot of ways, especially for me. So I'd like to say if this helped you listener, please share it with someone else that you think might appreciate having this news understanding, like the differences of these annuities and not to be scared. Don't be stressed and reach out to Matt. He'll help you. Be prepared. Not scared. It's the name of the game here. And, uh, thank you, Mr. Attache for being a part of the show each and every time.

Speaker 1:
As always. Here. Um. You're welcome. I thank you for it. And I thank you for watching and or listening to the show. Really do appreciate it. And until next time, take pride in yourselves and take care of each other. We'll see you then. Thanks for listening. To Take Pride in Retirement, members of the LGBTQ plus community deserve to work with a fiduciary financial advisor who puts their needs first. To schedule a free, no obligation consultation with Matt McClure and the team at Active Wealth Management. Call (855) 246-9211 or go online to take pride in retirement.com. Investment advisory services offered through Brookstone Capital Management, LLC. Bcm, a registered investment Advisor, BCM and Active Wealth Management Incorporated are independent of each other. Insurance products and services are not offered through BCM but are offered in sold through individually licensed and appointed agents. Fixed annuities, including multi-year guaranteed rate annuities, are not designed for short term investments and may be subject to restrictions, fees and surrender charges. As described in the annuity contract. Guarantees are backed by the financial strength and claims paying ability of the issuer. Any comments regarding safe and secure investments and guaranteed income streams refer only to fixed insurance products. They do not in any way refer to investment advisory products. Rates and guarantees provided by insurance products and annuities are subject to the financial strength of the issuing insurance company, not guaranteed by any bank or the FDIC.

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