Scandal-Free Retirement

If you take a close look at most folks’ financial situations, you’ll find that it’s almost scandalous how badly their financial matters have been handled. Let’s talk about the steps people should take to create a scandal-free retirement.


John Stillman: You're listening to, Wright Money Tips with Isaac Wright, President of Financial Dynamics and Associates, the author of Navigate Your Way to a Secure Retirement, and he's also a chartered financial consultant. Isaac, good to talk with you, as always. Maybe I should ask, what does a chartered financial consultant even mean? What do you have to do to achieve that designation?

Isaac Wright: No, always good to ask this kind of question. Sometimes we hear the parlays of different titles and we don't know what it represents, but a chartered financial consultant is actually a multi-year study course with multiple exams through different topics to basically allow you to be able to sit back and say that you have some due diligence behind the education of offering financial advice. So CFP, CHFC sometimes those are kind of intermingled, but I mean there are two different designations. Overall though, some new designations that are out there today, retirement income certified professional is also starting to make a headway. But for 20-plus years of doing this, John, I'm glad to see that education has taken a forefront to allowing people to feel more confident in their advisor.

John: Yeah, and just because somebody has or doesn't have a particular designation doesn't mean they are or aren't the right person for you to work with, but it does give you some kind of indication as to the level of expertise there. All right. Just wanted to mention that. In any case, if you'd like to get in touch with Isaac and the team at Financial Dynamics, the number to call or text, whichever you prefer, 804-777-9999. That's 804-777-9999. Isaac, let's talk about how to have a scandal-free retirement. If you take a look at most folks' financial situations, you might find that it's almost scandalous how badly their financial matters have been handled.

Isaac: Like the television show that's no longer on the air.

John: That's right. Did you watch Scandal?

Isaac: I did. My wife and I love that show.

John: I loved it the first several seasons, the last couple of seasons, I don't know. I mean, I watched it. I was still into it, but it wasn't the same to me.

Isaac: It went a little over the top. It went from being more realistic to a little bit more propaganda-ish, in my opinion.

John: Yes, I would agree with that. All right, so we're going to talk about the steps you need to take to rid your retirement of scandals. Okay? First thing you need to do is hang with me here. Impeach consumer debt.

Isaac: Hey, that would be something I think both sides of the aisle would rally behind. But one of the things too, you got to keep in mind that when you're dealing with trying to create a financial plan with a high probability of success, especially as you stop working and you transition to where your retirement income is going to be social security, maybe if you're fortunate enough to have a pension, but obviously many people now, very few have solid pensions to lean on. You're going to be using your investment dollar to make up for that "shortfall" that you need to cover your expenses.

Isaac: Well, if you have a lot of consumer debt, if you're buried in things that you have to pay off, especially at a higher interest rate, that's going to put you in a position where you're really going to be behind the eight ball and maybe not be able to do all the things that you've wanted to do. Let's call it with a discretionary amount of money per month because it's all going to pay bills. And maybe bills that, again, if they can be paid off, would free up more monthly money for you to be able to have towards other goals. So when we say impeach consumer debt, of course you can see that we're being somewhat playing on words today, but please know that that's very important for you when it comes to your own financial plan.

John: All right, so let's talk about the next step you want to take after you've impeached your consumer debt, you want to stop the leaks. Stop the leaks in your budget, Isaac.

Isaac: Well, when it comes to budgeting, I think sometimes people can say that's a four letter word, cause we all spend a different amount of money month-to-month. I think we all can agree on that. And a leak doesn't mean necessarily that you have certain things that you spend money on one time here and one time there, but I would almost say the leaks or a leak in general is something that takes you by surprise. And sometimes by not going through the exercise of estimating your monthly expenses and estimating money that you know ... and I would even call this more importantly of the budget you have, the expenses that you have month after month after month.

Isaac: I'll give you a great example. Many people complain about how expensive Verizon is when it comes to their bill, internet, phone. I mean, the amount of money you can spend is getting up there, two, three, $400 a month, if not sometimes more I've heard. Maybe consider a streaming service to watch television. And all of a sudden, you can cut your bill 30, 40, $50 a month. Many people have Medicare supplements that are paying two, $300 a month for a supplement that they've raised their rates on three or four times since they've turned 65. Maybe shop that out. See if you can save 50 or $100 a month on the exact same type of policy. These are things that you can start shutting off the "leaks" and estimating expenses a little bit better, and also lowering expenses as well towards your retirement.

John: So impeached consumer debt, stop the leaks in your budget. The next step to a scandal-free retirement is you ... actually, in this case, you do want obstruction, Isaac. You want to obstruct your catastrophic market losses.

Isaac: Well, obstruction here means simply understanding through multiple different ways how much money you're likely to lose based upon a portfolio you're putting together, if the market would have another significant pullback ala 2008, 2000, 2001, 2002 again. It's been quite a long time since we've had a significant stretch of a bear market, but it will happen again and you don't want to become too greedy at a point where it may cost you more. You may have to make a decision.

Isaac: I always tell people, many people that have listened to me for years, I call it your uncle point, how much money are you willing to lose even on paper before all of a sudden you start making some significant or maybe some drastic decisions that otherwise you never would have made if you would have had a risk tolerance towards your portfolio? And that's one of the things we can help you with at our office. If you're not familiar with that, we can talk to you about, again, it's not necessarily sometimes how much money you make, it's how much you keep and we can help walk you through what that looks like. So if you have any questions on any of these today, again, reach out. Talk to us here at our office. Talk to me personally if you would like. 804-777-9999.

John: You can also text that number if that's easier for you. 804-777-9999. Somebody will get back with you that way. Of course with the text, it might not be quite as immediate as if you just call and talk to somebody. But if you text, we'll get back to you eventually. All right, so you want to impeach consumer debt, stop the leaks in your budget, obstruct your catastrophic market losses, and then Isaac, you need to be a whistleblower. Blow the whistle on unnecessary or excessive fees in your investments.

Isaac: Well, you always want to be aware of that. So if it takes our firm to blow the whistle on what you are actually spending in advisory, and mutual fund, and in investment, and even to some degree the amount of money you're paying in taxes towards the, let's call it the end game of your portfolio. We want to make sure that you're in a place where, listen, everything has expenses, everything has fees, everything ... there's going to be a cost to do business. And here's the thing you need to understand is not necessarily you're going to be able to eliminate all that, but what value are you receiving for the fees that you're paying? Now, if you've listened to me for again years, we talked about this, this is our investment cents review. It's a very important part of our process here. And we can also educate you if you're already in a good spot too. It doesn't mean everything's bad.

Isaac: So we may blow the whistle positively on your situation. But if there's a negative situation or room for improvement, we will absolutely "blow the whistle" to let you know, "Hey, here are a few things we can help you with." So just know this. And again, if you don't have a situation where you understand your full degree of expenses or how your risk is in your portfolio, as we get here closer to the end of the year, I think you want to know that. I know we're playing off of this coming right out of elections, but just know that this is a personal matter that you can take control of. And I think sometimes people lose track of that by just watching so many other information that goes by their screen every day. Take advantage of understanding your own personal situation cause that's something you can control.

John: All right, the last item in a scandal-free retirement. Isaac, do you care to guess? Again to review, we've impeached consumer debt. We've stopped the leaks in the budget. We've obstructed catastrophic market losses. We've blown the whistle on unnecessary fees. What is our last step? What are we missing here?

Isaac: I'm scared to ask.

John: Well, we want collusion, we want to collude with a good advisor.

Isaac: That's true ... I love all these terms, man. Good work. Collusion with a good adviser. Well, let me say this, I'm glad we're ending this on a positive note of collusion because you do want to have someone that really does have your back. I know for years, again, without overselling our firm or myself, I just know that over 20-plus years and especially now being in our new office space at the intersection of 288 and Powhite, we've had a lot more families come visit with us. We're a lot more, let's call it face-to-face with those that would prefer that. We can still talk to you over the phone. We can do a video conference, so we try to use technology to be assisting you in terms of your time management as well. But you have to have, in my opinion, I think you got to have somebody willing to help advise to some degree.

Isaac: Some of you may need more help than others. Some of you may be very much a do it yourself type of person and you've heavily weighted all of your financial planning based upon things that you've read, done, researched and there's nothing wrong with that. I always tell people this though. What happens if something happens to you? What happens if you have a situation where you have not at least philosophically covered the basis with an advisor, that if something happens to you, maybe your spouse all the sudden is in left field because you've done all the work, or maybe simply you don't want to do all the work anymore? So again, it doesn't mean finding an advisor means somebody that's going to hard press you into buying an investment. It's really about managing and maintaining a healthy relationship and that's the way a professional relationship should be anyway. So John, I'm glad to cover all of this post-election and post-drama to all the multiple news outlets that are out there today.

John: Yeah, they're going to have to find a new way to get some ad revenue for a little while after the political ads are done. At least temporarily. It won't be long before they pick right back up.

Isaac: It never is, is it?

John: Yeah. So thank you, Isaac, as always. Again, this is Wright Money Tips. You can find out more online at Isaac is a chartered financial consultant and the President of Financial Dynamics and Associates. The number to call or text is 804-777-9999. That's 804-777-9999. Thanks so much for tuning in. We'll talk with you again soon. Right here, same time, same place.

Announcer: Information is for illustrative purposes only and does not constitute tax, investment or legal advice. Always consult with a qualified investment, legal or tax professional before taking any action.

Announcer: Advisory services offered through JW Cole Advisors, Inc, JWCA. Financial Dynamics and Associates, Inc. and JWCA are unaffiliated entities.