Are you a golfer? Even if you’re not, the game of golf can teach us valuable lessons about retirement planning. For example, hitting a hole-in-one might be thrilling, but it won’t necessarily guarantee your overall success. And just like you need different clubs in your golf bag to play a round, you need a well-balanced approach to your investments in retirement. But perhaps the most important lesson from golf is the value of having a caddy. In retirement planning, a financial advisor can help you navigate the hazards and make the most of your financial “clubs.” Tune in to this episode to learn more about how the game of golf can help you plan for a successful retirement.

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PFG Private Wealth Management, LLC is a registered investment adviser. All statements and opinions expressed are based upon information considered reliable although it should not be relied upon as such. Any statements or opinions are subject to change without notice. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investment involve risk and, unless otherwise stated, are not guaranteed. Information expressed does not take into account your specific situation or objectives and is not intended as recommendations appropriate for any individual. Listeners are encouraged to seek advice from a qualified tax, legal, or investment adviser to determine whether any information presented may be suitable for their specific situation. Past performance is not indicative of future performance.

Transcript of Today’s Show:

For a full transcript of today’s show, visit the blog related to this episode at https://www.pfgprivatewealth.com/podcast/

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Marc: Back in for another edition of the podcast. Thanks for hanging out with John and Nick here with me. Talk investing finance and retirement here on Retirement Planning – Redefined. We’re going to have a little fun with this podcast conversation, a little golf lesson and tie-in to financial planning or retirement planning. So this will be fun. It’s right up your guys’ alley. John, just a few weeks back, you guys had your annual golf tournament, and we had talked on the prior podcast, it went really well. I should have had this ready for you. We could have talked about it then, but that’s okay.

John: Yeah, yeah. It’s all right. If you want to ask questions about it, I can definitely tell you. It was a great event and we donated to Boys and Girls Club of Tampa Bay and Tampa Hope, which provides homeless shelter stuff. So, yeah.

Marc: That’s awesome. Yeah.

John: Yeah.

Marc: All right, so are you a big golfer yourself?

John: No, I’d like to be when I can get back at it, but I’m not very good. It’s been on my to-do list to take some lessons and be able to get on the course, but I like-

Marc: Well, you don’t have to be good to like it. I think that’s most people.

John: Yeah, no, I like going on the cart and driving around and hanging out with my buddies.

Marc: There you go. Nick, what about you? Are you a golfer at all?

Nick: I wouldn’t call it golf, personally, I go out and I hack for-

Marc: Yeah, there you go.

Nick: … about seven or eight holes-

Marc: There you go.

Nick: … and then I’m pretty much done at that point.

Marc: You’re a hacker. Okay.

Nick: Yeah, maybe now that I’m in my forties it’ll be something that I reengage with, but I enjoy being out there when it’s the nicer time of year, the cooler time of year here. It’s fun to hang out with buddies and go and be out, but it tends to be a four to five hour chunk. So it just depends on my mood, I guess.

Marc: Yeah, it certainly can be fun. It can be a frustrating sport, but it’s easy to do, and of course it’s obviously a very popular sport for retirees and pre-retirees, so it’s easy to do some financial analogies with it. Since you guys just had that golf tournament and raised some money, which, again, is fantastic. This’ll be a little fun podcast conversation. So let’s jump in and talk about some lessons we can get from the game of golf financially speaking, and we’ll just have a little fun with this. So hitting a hole in one. I’ve actually seen this done live in person. I was playing with some friends a couple years back and we were playing with…. we got put with an older couple and she won the day, she was killing us. She was right down the fairway every time. We were all left and right around the sun. She was awesome, but her husband, on a par three, popped one up and lo and behold dropped it right in the hole. It was just totally awesome to see that happen. Thinking about this guys, I think about getting lucky in the market one time. Because this guy’s attitude changed when he got the hole in one. He was super excited. He obviously was very cool, but you could see the rest of the day he felt pretty cocky about his game. I would imagine that from a market standpoint, that could be the same thing. You do really well on one investment in the market and you think, oh, I got this whole financial thing figured out, and it might not be that easy.

Nick: Yeah. It can be interesting. Just in general, and you alluded to it, people like to talk about their wins more than their losses. That’s something that we see quite a bit. It’s a similar concept as when you have a friend that goes to Vegas and they talk about how they hit on a certain thing, but not necessarily that they came back less money than they started. It’s that concept. The goal when we’re focusing on financial planning, retirement planning, that sort of thing, is a long, well-thought-out strategy that encompasses multiple decisions, builds in options for different scenarios and really is just more strategic than having a single goal in trying to necessarily get lucky.

Marc: Well, and John, I was going to say, I think most golfers would agree that a hole in one is a little bit of skill, but a whole lot of luck. Maybe that’s the same thing to be said for the market, but you can strategize properly with your retirement and not just be wishing for luck, I suppose, in retirement, right?

John: Yeah, yeah, you definitely want to have a strategy and a plan versus just rolling it all in one event, unlikely event really happening. So you want to make sure that you put together the strategy, and again, you’re just trying to hit, bring it to baseball, those singles and doubles consistently, versus always trying to go for the home run.

Marc: Well, like I was saying, the gentleman’s wife, at the end of the day, he got cocky because of that fairly early, and he clearly was going to beat the two younger guys that he was playing with that day, me being one of them. I think he felt like the day was his because of the hole in one. But she wound up winning the day from having and shooting the best round because she was consistent. To your point with baseball there, she was right down the fairway, 150 yards every time. She ended up just kicking our tush because, like I said, we were all over the map, somebody else’s hole and everything else from slicing and all sorts of good stuff. So consistency, while a hole in one is sexy, consistency is probably the better idea for a strategy. So let’s talk about clubs in the golf bag. This is a fun analogy to think about too. You’re probably not going to go play golf and go Happy Gilmore and just show up with a driver and a putter. You need some more things in there.

John: 100%. This goes with your investments. You can’t just have just one tool in the bag there. You definitely need to have different investment vehicles doing different things so you really hit your goals. In case with golf, you make sure you get the best score possible. Same thing with your retirement planning and investments. You want to have different investments. Here’s the term everyone hears, diversify. You want to have different investments in your portfolio, investment portfolio, and different investments overall, whether that be some fixed income stuff, and then especially nowadays with the rates being the way they are, CDs are definitely a great option right now. So you want to have the different irons, different drivers, different-

Nick: Yeah. One thing that people tend to obsess about is, “What’s best, what’s best, what’s best? Should I have this or should I have that?” So frequently our answer is, “Well, it depends,” and or, “Yes, all of the above,” and it dovetails into this where, “Sure, you do want to have some funds that are going to be pre-tax and also some funds that’ll be tax-free later on,” and really focusing on the fact that just because something is better right now doesn’t mean it’s going to be better later. So the ability to be able to adapt and pivot and adjust to whatever the scenario is, is super important.

Marc: Yeah, and that’s the point of, “It depends,” sometimes with that answer because while it’s not the flashiest of answers, because it’s not a set it and forget it. Your strategy is going to change. Just like the club you’re going to have to pull out of the bag may change. You may think it looks like a simple 7 iron shot, but as you start to look at it and evaluate a little bit more, you might realize that it’s not, you got to go with a different club. So different clubs do different things, different investments do different things. Having that arsenal, I suppose, at your disposal is really what you want to do, versus, again, like I said, just trying to be Happy Gilmore out there and use a driver and a putter only. Probably not going to go the way you want to go. That comes to the final one here for this little fun analogy, guys, is listening to a caddy. Now, granted, when a lot of us go play golf, we don’t have the luxury of having a caddy, but you may have some friends who you’re doing a foursome or whatever and they’re giving you some advice or things of that nature. And while you don’t want to ask your friends necessarily for financial advice, if you ever have got the chance to play with an actual caddy, it’s pretty freaking cool. A true professional can really make the difference. I’d say that’s an easy analogy to what you guys do.

John: Yeah, 100%. I will say having an advisor in your corner, just someone to talk to, ends up having… people end up making better decisions with that. Just go back to the most recent thing, COVID here, where I would say the first month of that was really calming people down and talking them off a ledge. I’ll tell you how many times we heard, “Oh, I’m so glad we got the chance to talk because I was getting really nervous and thank you for your time.” So just having that resource of someone to bounce some ideas off of or just talk things through, ends up in the long run helping someone out financially more than they realize.

Marc: Yeah, definitely. Again, it’s the little things. It’s not always just the Xs and Os, sometimes it is having that sounding board, “Hey, I’m thinking about this idea. What do you think?” “Okay, this is a good idea because X, Y, Z,” or, “This is maybe not a good idea because X, Y, Z.” So it’s certainly important to have those conversations and if you need some help, reach out to the team. Obviously, as always, they’re here to help you with this, to help you get to and through retirement. Pfgprivatewealth.com is where you can find them online. Pfgprivatewealth.com, and drop us a line while you’re there, send an email in to the website if you’d like to have your questions answered. Of course, they’re going to certainly do that with each and every question, but we also take those from time to time here on the podcast. So yeah, let’s wrap up with one or two here guys. We’ll see how we can go, see how many we can get through. We got Claire, and she says, “I’m supposed to retire next month, guys, but I haven’t really done any planning at all.” Yikes. “I just realized that I still need to figure out Social Security options, pension options, Medicare options, and as well as what I’m just going to do with my time.” Wow. “Should I push my retirement date back until I figure this out?” Guys, that’s a interesting one and a tough one. Not trying to pick on her, but she’s done zero planning and thinking about retiring in a month.

Nick: Yeah, probably not a good idea. There’s two ways to address this. Well, what we would say to somebody in this situation is, “Okay, yeah, you need to focus ASAP on putting together a plan,” because usually when this happens, it’s because of anxiety of what the answer is going to be. It’s the concern that whatever the results are of the plan are going to say, “Hey, retiring is not a good idea,” or that the plan doesn’t look good or that sort of thing. So taking the action to do something is really, really important, and you can’t rewind time. So getting that plan in place. Would recommend holding off on the retirement until you can put the plan in place. Just there’s probably options in strategies that they’re not familiar with that can be put in gear sooner than later and could help to make that retirement more successful, because people’s ability to reenter the workplace after they have exited is often much more difficult than they realize.

Marc: Yeah, John, I’d say probably just call somebody, right? Get started. Don’t wait one more minute, right?

John: Yeah. Mistakes can be costly and it sounds like Claire has a lot of important decisions to make, especially with the Social Security and the pension there, one wrong move on that, you could be losing thousands of dollars, basically, is what I’m getting at.

Marc: Yeah, yeah. Yeah, so you got to get a strategy, Claire. Do you need to push off retirement? You’re just not going to know until you figure the two… Her question is, “Should I figure this stuff out?” Yeah, get in, sit down with a professional and find out where you stand and they’ll be able to help you determine is retirement next month even possible? I guess my question would be, how do you know that you could retire next month? She says, “I’m supposed to.” Maybe they’re going to retire her from the job. Maybe she’s been told. I don’t know. It could be one of those types of things, but either way I would get in to see a qualified professional, ASAP, and of course John and Nick are here to help. So 813-286-7776. All right, final question here. We’ll do one more. Lee says, “Guys, I don’t understand the Social Security spousal benefit. My wife worked for about five years before we had kids and hasn’t worked since, but she does have some benefit of her own. What is she entitled to? How does it work?”

Nick: This is a good question, and the reason that we wanted to review this with people is because sometimes the tricky part with dealing with planning, retirement planning, is the jargon or the terms that people use. Sometimes they mix up the terminology and that can lead to mistakes, which can lead to big problems. In this case, from a spousal benefit standpoint, in general, people are eligible either for a benefit of their own based upon their own work history, and that is only valid if they have 40 quarters of work. So 10 years of work. Now, if they are married, and there are some additional scenarios, if they were previously married but married for at least 10 years and are divorced, there are some options on spousal benefits at that point. There’s so many different scenarios that if somebody’s situation is complicated, we highly recommend that you reach out to an advisor that’s familiar with this space. But in this specific example, the spouse working for five years is not going to be eligible for her own benefit. She is going to be eligible for a spousal benefit, and that spousal benefit is a calculation factored on the primary earner’s income and how long they’ve paid into the benefit and that sort of thing. So this is something that we would tell, “Hey, we can help with this scenario. The main information we’re going to need is going to be the Social Security statements, and then we have some software that helps us pick, show what those numbers look like. But the spousal benefit is going to be a factor of the primary income earner’s benefit amount.”

Marc: Okay. Yeah, so definitely can get very complicated. Thanks for sending the question in. Hopefully that helps you out, but definitely have a conversation with a qualified financial professional. Reach out to John and Nick to talk more about Social Security and eligibility and all those good things and how it plays into it. 813-286-7776 is the number to call, or stop by the website, pfgprivatewealth.com. That’s pfgprivatewealth.com. Don’t forget to subscribe to the podcast on Apple, Google, Spotify, all that good stuff. As always, we appreciate your time. You can catch past episodes by subscribing or check out future episodes when they come out. Thanks for your time today, for John and Nick. I’m your co-host, Mark Kelly, and we’ll see you next time here on Retirement Planning – Redefined.