Ep 41: Opportunities For Retirement’s Late Bloomers

On This Episode

Maybe you’re close to retirement and think you don’t have nearly enough money saved. But let’s talk about some reasons that the news might not be as bad as you think.

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PFG Private Wealth Management, LLC is an SEC Registered Investment Advisor. 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. The topics and information discussed during this podcast are not intended to provide tax or legal advice. Investments involve risk, and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial advisor and/or tax professional before implementing any strategy discussed on this podcast. Past performance is not indicative of future performance. Insurance products and services are offered and sold through individually licensed and appointed insurance agents.

Here is a transcript of today’s episode:


Mark: Hey, everybody. Welcome into another edition of the podcast. It’s Retirement Planning Redefined with John and Nick, Financial Advisors at PFG Private Wealth. You can find them online at pfgprivate wealth.com. That’s pfgprivatewealth.com. A lot of good tools, tips, and resources there as well as a way for you guys to find the podcast, listen to past episodes, subscribe to it, all good kind of stuff. We are going to talk about opportunities for late bloomers in retirement this go around on the podcast. [inaudible 00:00:28] what’s going on? John, how are you, buddy?


John: I’m good. How you doing?


Mark: Hanging in there. Not doing too bad. Hope things are going well for you. Nick, you doing all right, my friend?


Nick: Yep. We’ve had some nice fall weather here lately, so I’ve been enjoying that.


Mark: There you go. Humidity finally-


John: Yeah, I get to put a hoodie back on and no humidity


Mark: Vacation [crosstalk 00:00:47].


John: By enjoying, Nick means he’s just open up his balcony door versus going outside.


Mark: Gotcha. Let the wind in. All right. That’s all right. Hey, I’ll take it. That’s good. Let’s talk about these late bloomers here. Maybe you’re close to retirement and you think you don’t have nearly enough money saved. We mentioned that on the prior podcast a couple of weeks ago. That’s often the case with people. They feel automatically like well, I know I don’t have enough, even though you have no idea because you’ve never sit down and done a plan and gone through a process to try to find out, but let’s just assume that you don’t have nearly enough or you think you don’t. There’s some good news. There’s some places we could actually gain some ground pretty quickly.


Mark: Guys, I’ve been using this analogy for this. I turned 50 this year and Memorial Day is kind of the unofficial kickoff to summer. It’s not actually summer, but everybody just kind of treats it like it is. It’s kind of how summer starts. 50 seems like the unofficial kickoff to retirement because it’s when you start going, I better get serious. Right? When people turn 50, they start to think about this a little bit more. Catchup contributions is a great way and you can make some serious dent in the savings that you need with some of the things that government allows us to do once you turn 50. Talk to me about that.


John: Once you turn 50, you can do catchup provisions, which if you have a individual or retirement account, AKA IRA, you can put an extra 1,000 into it if you’re above the age of 50. If you got yourself and a spouse, it’s an extra two grand you can put in there. Most people, where we kind of maximize the strategy is in the 401k where you can actually do an additional 6,500, which is a nice way to not only save, but also reduce your taxes. With the 401k, it’s pretty easy because you just contact your payroll provider or go online where your investments are and a couple of clicks and there you go. As we say, once it’s done through your payroll, it’s easy to just set it and forget it. You just adapt to what you have as your net income moving forward. Definitely once you hit age 50 something, you need to start consider just saving more to hit your goals in retirement.


Mark: Oh, yeah. I mean, $6,500, that’s not chicken feed, especially over, let’s say, 15 years. If you’re 50 and you’re planning to retire at 65, that can add up. That can make a nice dent in catching up from being behind. Now, I know you don’t have kids to speak of. John, your kids are too little just yet, but kids coming off the payroll, this is something you guys still deal with. You have a lot of clients that, when you get 50 plus, hopefully you’re making the most money in your life that you have. Usually that’s the case for a lot of people when they’re in 50 plus. As my dad used to call us, biscuit snatchers, come off the payroll because we’re no longer doing things like the car insurance, cell phone. As a matter of fact, my daughter’s out working and doing things as a young adult and she’s actually paying the cell phone bill for her mom and I, so how about that?


Nick: This is interesting. I would say that over the last, probably six, seven years, we’ve seen this get pushed back a little bit where it tends to be the kids start to come off the payroll with clients that are in their early 60s, but it’s substantial and it’s usually a huge relief. We’ve got clients that have been able to bump up their savings by 1 to $2,000 a month with kids graduating from college or whatever it may be. It makes a huge difference, whether it’s saving more money, whether it’s using that additional money to maybe help you achieve the goal of paying your mortgage off by the time you retire. Recapturing those funds is a really, really big deal. When they come off the payroll, just figuring out a way to try to recapture at least 50 to 60% of that could make a huge difference to help somebody catch up.


Mark: John-


John: You like that term biscuit snatcher, don’t you?


Mark: You like that?


John: You used that in one of our workshops, so…


Mark: That’s what my dad used to call us because he loved his biscuits and I was always running and snatch one and take off with it. You’re going to get this at some point, John. Obviously, you do this for your clients. You help them navigate this now, but with your two little ones one day, you’ll be having all these extra things and then they’ll come off the payroll. I mean, it could be sizeable. You could be paying their car payment, their cell phone, car insurance, maybe some health insurance, so it adds up.


John: I actually just experience some of that because… And my wife works. She’s just actually wrapped up her master’s program for nurse practitioner, but we had a nanny for that period and that just stopped. That just freed up some cash flow, which was pretty significant for us, but so I know the feeling of it.


Mark: A lot of places and a lot of opportunities for “late bloomers” in retirement to gain ground if you’re behind. Another one, guys, is disappearing debt. Maybe you’ve got some things… Again, we’re going to use this analogy of the 50 range, like 50 to 60. You’re getting into that pre-retirement stage. You’re trying to make sure you’ve got enough. My wife and I just got our boat paid off, just I think last month or two months ago, something like that. She just paid off her car. Now, she’ll probably get another one between now and the time we get to retirement, but still, you get the idea. Credit cards, things like that, that stuff’s really starting to dwindle down. [crosstalk 00:05:56].


Nick: Being able to recapture those is a big deal. The car thing is still an interesting thing just from the perspective of growing up up north and you have to deal with rust and the wear and tear of winters have on cars and all that, whereas down here in Florida, they can last so much longer. That’s a good example of something that people are able to leverage to help recapture some money to save. Like you said, that mortgage going away, getting that paid off or eliminating that credit card debt. I’ve had a few clients that in the last 12 to 24 months, they’ve been able to wipe out debt that they had had from… One was healthcare related and a couple of other things. Being able to redirect that money and that’s always the key is to recapture and redirect. That can make a big, big difference.


Mark: Especially the credit card stuff because there’s the whole bad debt, good debt thing. Take those high interest things first and get rid of those. Since we mentioned the home, that’s another place, so maybe a downsize is on the radar. In this area, a lot of people doing the condo kind of thing. Maybe you don’t want to do the big house. Maybe you’re moving from up north, Nick, to your point a minute ago. The difference is maybe you want to think about it from a everything needs to be on the first floor because my knees can’t handle the stairs standpoint. Either way, prior to recently now… Recently, the housing market’s been pretty crazy, so selling it, you might get a lot of money, but you also might pay a lot of money for the next place, but it could be potentially a place where you could capture some more gains as well.


Nick: Replacement cost is high right now, but downsizing can definitely be something. We’ve had a few clients do that recently. We’ve also had some clients, and this is a good reminder of the… For example, we’ve got one client that has had a beach rental that they’ve been using to rent out Airbnb for a while. They’re going to take advantage of the market by selling their primary residence at a pretty high number and then going ahead and no longer renting out the Airbnb rental and moving into that space. That’s something that they’re able to take advantage of.


Nick: Then not only that, but from a strategy standpoint, there’s that capital gains exclusion that’s out there where a married couple can exclude up to $500,000 of gains in a property. They’re able to exclude the gain in their primary residence and then we went through and reviewed that if they then live in the rental that would’ve been previously the rental, if they live in that for two years and then sell to maybe shift into another property, that they can exclude the gains in that if they wait the two years. There’s some strategy that can get involved in that space to help you on taxes and help you also downsize.


John: One thing with the downsizing, and we’ve run into this a couple of times where I would say just be careful with downsizing because we’ve had some scenarios where someone thought they were downsizing and when we started to really evaluate the costs of everything, it really wasn’t much of a downsize.


Mark: Good point.


John: It needs to makes sense, especially when you take in account, property taxes here where you can homestead and when you move, you can transfer it over, but sometimes you don’t get the biggest bang for your buck. It’s just as important to really evaluate the new house. Does it need renovations? Things like that. The maintenance costs, and that’s where you always go back to the plan when making these type of decisions because we’ve seen scenario areas where someone wanted to, we actually evaluate it and it’s like that doesn’t make sense to do it.


Mark: Another great point. There’s so many reasons to consider it. Obviously, there’s the financial potential as we’re talking about this particular go around, but as I mentioned, it could also be something where you need to simply because you cannot physically handle the house anymore. You got to take a lot of those things into consideration, but right now, we’re talking about how to use the money to gain ground. It’s just another way you could potentially make up some of that if you’re a late bloomer. Then the final one is maybe the twilight career. If you want to find a silver lining through all this pandemic stuff, it’s the fact that the world has definitely embraced telecommuting from work, or just all kinds of different really, jobs and things that you could do remotely. Maybe you do need to make some ground and maybe you can’t do the full corporate job or whatever it was that you were doing as your main career, but a twilight career could be there. You could be selling your crocheting stuff on Etsy or whatever. You could be consulting just from your kitchen.


Nick: We’re in an era where workers have a little bit more power right now post and I guess still on the tail end of COVID. We’ve had clients that have been able to… Sometimes we call it the make my day strategy where they’re important to the company. They know it and they go through and they negotiate. They’ve been working from home, at least for a portion and they’ve still been productive, so they’ve gone to their employer and said, “Hey, if I can work from home three days a week, I’ll continue to stay here for X amount of time,” or just using some of the stuff that’s going on as leverage because companies are having a really difficult time hiring. It’s become very, very competitive. We’ve had some clients go ahead and use that to their leverage. Then like I said, it’s just they take advantage of that until they’re no longer happy and then they exit.


John: We’ve seen a lot of people a little different where they start working part-time and really start getting into hobbies that they enjoy for income, photography, event planning, things like that. There’s definitely a lot of different avenues you can go in this period of time here because we’ve seen quite a few people churn hobbies into income.


Mark: That could be a great way to not only offset the shortfall you may have or even whatever the case might be, but it’s also just something to do. I mean, just keeps you active so why not “double dip”? Get something out of it. You’re getting some activity, something you enjoy, but also adding a little something the to the income levels.


Nick: I was going to also mention that where one thing that we have found from some people is not having a purpose or a routine has been very difficult.


Mark: Oh, yeah.


Nick: Some people handle it better than others, but in general, people need some sort of purpose. Some people are able to take that extra time, spend it with kids, grandkids, travel, do all these different things and they’re very comfortable or they have an active social life and it works out well. A lot of people got a lot of those interactions via work, and so not having them anymore, spending an extra 40 hours a week with their spouse, as much as they love them can be a little bit much. Whether it’s volunteering, whether it’s finding something, just having an open mind and looking for something that fulfills you and gives you purpose is a really big deal.


Mark: You got to have something to retire to as well, otherwise you just turn into a couch tater and you don’t want to do that. Those are so some places where you can make up some ground if you are a late bloomer in retirement, meaning basically you feel like you started too late or you don’t have enough put away. Of course, how do you know? Well, you know by getting a plan put together to see if you are even behind because again, you might not be. Reach out to the guys, to the team at PFG Private Wealth. Stop by the website, pfgprivatewealth.com. Get scheduled to come in for a consultation and find out, first of all, even if you are behind and if you are, then you can look at some of these options and some of these opportunities that we highlighted today on how to make up that ground, pfgprivate wealth.com. That is pfgprivatewealth.com. Don’t forget to subscribe to the podcast while you’re there on Apple, Google, iHeart, Spotify, whatever platform you like to use. You could find it all at the main website, pfgprivate wealth.com.


Mark: While you’re there, you can drop a line as well and we take those from time to time here on the show. Let’s wrap up with an email question from Elizabeth. She says, “Guys, I have a pension fund from a previous job in a different state. It’s been sitting there for years, but I do have the option to take the lump sum and invest the money myself, or just leave it there and get the monthly pension once I retire. Thoughts?


John: This is coming up quite a bit lately with pensions offering these lump sum payouts for participants. It really important to evaluate if you take that lump sum, what type of income could you expect from it on a, basically, lifetime basis. What goes into that is really your risk tolerance. What could you expect to achieve from a rate of return based on how much risk you want to take? Again, you want to look at this from a conservative standpoint. What we’ve done in the past with clients, we might compare it to maybe doing their own type of guaranteed income stream through some other financial vehicles and see is it similar and maybe provide some more flexibility they’re comfortable with, the financial health of the current pension. I wish there was an easy answer for this, a yes or no, but as always, it depends on your plan and your situation, and what works for you and, and your family if you have beneficiaries. There’s a lot of different factors that go into this.


Nick: Testing it through the plan’s so important, especially John alluded to the beneficiary aspect. For example, we’ve had a fair amount of clients that maybe they’re single, whether it’s widow, divorce, whatever, and their beneficiaries are their kids. The thought of having worked for a company for a prolonged period of time and what would be a substantial pension. Their kids not being able to benefit from that at all if they were to pass away early doesn’t sit well with them. They’ll look for alternatives. There are a ton of factors that go into that, but comparing and using realistic variables when you’re making those comparisons is really important.


Mark: I mean, it’s one of those things where a lot of times, you do have more controlling options if you take the money in lump sum and do it yourself, but it’s not the right fit for everybody. Definitely a great question. Reach out and call the guys and have a one on one conversation or share some more details for sure. 813-286-7776 is how you can get ahold of them if you’ve got questions of your own, 813-286-7776 or again, stop by the website, pfgprivate wealth.com. That’s all our time this week here on the podcast. We appreciate you guys as always, for John and Nick. I’m your host, Mark and we’ll see you next time here on Retirement Planning Redefined.

Ep 31: Where Crisis & Opportunity Meet

On This Episode

To write the Chinese word for “crisis,” you combine elements of two different Chinese characters. One character means “danger” while the other one means “opportunity.” Translated into English, it means “opportunity riding on a dangerous wind.” Let’s discuss how some of these crises might actually be opportunities, depending on your situation and perspective.

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PFG Private Wealth Management, LLC is an SEC Registered Investment Advisor. 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. The topics and information discussed during this podcast are not intended to provide tax or legal advice. Investments involve risk, and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial advisor and/or tax professional before implementing any strategy discussed on this podcast. Past performance is not indicative of future performance. Insurance products and services are offered and sold through individually licensed and appointed insurance agents.

Here is a transcript of today’s episode:


Marc: Time for another edition of the podcast. Thanks for hanging out with us as we talk investing finance and retirement here on Retirement Planning – Redefined with John and Nick from PFG Private Wealth, and we’re going to talk about when crisis meets opportunity here on this episode of the podcast. But first I’ll say hi to the guys, and then we’ll dive into what that means. What’s going on, Nick? How are you?


Nick: Oh, doing well, doing well. It’s been a really busy start to the year. People are anxious to kind of check in and go over things and all that kind of stuff, so we’re enjoying catching up with everybody and just kind of walking them through where we are and how things are going.


Marc: Good. Yeah. As the first quarter winds down, I imagine that’s the case. John, what’s going on with you, my friend?


John: Oh, not too much. As Nick mentioned, just a very busy start to the year, so yeah, get in touch with everyone has been good. And I think the last time we said the weather’s starting to warm up around here, so we have two or three months of some really nice weather, then it’s going to get scorching hot. So just try and enjoy the nice 70s to 80s for the time being.


Marc: There you go. Exactly. Well, so what we’re talking about this week here on the podcast is some people view certain things that are going to happen to us in retirement, or that happen to us in general, when it comes to our financial lives as a crisis, and other look at it as an opportunity, right? So I’m going to give you guys a couple here. I’ll let you guys expound on those based on what you see or what you do, and we’ll just discuss some of these ways that these crises, if you will, might actually be an opportunity, a good way for you to look at it, maybe change your perspective just a bit.


Marc: Now, John, I know we’re in totally different spaces when it comes to this, you and I, but I am an empty nester. I’ve been one now for, well, actually about two and a half years going on three years. But for some parents the idea of empty nest is a very joyous one. My wife and I were pretty surprised at ourselves. We were like, “Sweet. We love her, but bye, do your thing, have a good time.” And for others, obviously, there’s a very sad attachment and sometimes they have trouble with it. But from a financial standpoint, what’s some things to think about here?


John: Some of the things you can think about is definitely your cash flow. I would assume for the most part is now you have a little extra cash flow. So from a financial standpoint, I think, in the last session we talked about in the 50s having a little bit extra money to save.


Marc: Right.


John: We see that quite a bit when kids are out of college. You’re no longer paying for college bills. Your electricity, water bills, maybe gone down a little bit.


Marc: Cell phone.


John: And the big one is groceries.


Marc: Groceries.


John: That really shot down for certain people here, and it really gives you an opportunity to either save some more for retirement or go on some more vacations and travel, you know?


Marc: That’s a good point. Nick, I wasn’t trying to leave you out there, but I know that you don’t have any little ones yet, so I just was getting John’s take on that. What do you see though, from a planning aspect?


Nick: Yeah, it’s interesting because we almost see this happen in kind of like two phases. So, for a lot of our clients, the first phase is when the kids go away to school. It’s kind of like … Or even from the standpoint of when the last kid goes away to school, so there’s that period of time where they’re away at school, but they’ll come home on breaks, and maybe during the summer they stay at home, and so there’s a little bit of adjustment. But while they may not be at home, they may still be on the payroll per se?


Marc: Right.


Nick: And then there’s that kind of full shift into, all right, they’re gone, they’re off the payroll and what now sort of thing. And for some, depending upon the age that they are, that’s where grandkids may come into play. And so there’s a little bit of a transition where maybe you’re watching the grandkids a couple of days a week, and people tend to kind of like having some sort of interim between they’re being a crazy household versus an empty household.


Nick: But really that recapture of money that was being spent, saving it, putting it away, so that’s one of the most effective tools I would say that we have to kind of help people with this process is if we’re able to show people. Maybe they’re somewhere from five to eight years out from retirement and it’s like, “All right, our expenses have dropped by a thousand dollars a month with the kids kind of shifting out of the house. We had originally planned to retire at 65, but if we save this thousand dollars a month, is there a chance that we could retire at 62, 63, 64?”


Nick: And so, kind of going through a planning process and showing them like, “Hey, yeah, in some cases, if we can recapture those dollars, if we can put that money away, we can get you into that next phase of life a little bit quicker.” There’s a huge relief for many people that comes with that where there’s less … Even if they are going to continue to work, knowing that they may not necessarily have to work, there’s a huge kind of mental relief that we see in people. And so I’ve seen that really alleviate some of that mindset change quite a bit.


Marc: Gotcha. Yeah. And so whether you view the empty-nest syndrome as a crisis because you’re like, “What are we going to do? We’re all by ourselves.” And maybe it’s a standpoint of you got to spend more time with your spouse. It’s just the two of you. Who knows what your viewpoint is? But at the same time, you could look at it as an opportunity to maybe put away more for retirement, whether it’s they’re half off the payroll, completely off the payroll, to both of the guys’ points here. So try to find the opportunity in that versus necessarily the crisis.


Marc: All right, so let’s move to the next one, guys, and that is market downturns or market crashes. You know, obviously they’re going to be stressful no matter what happens. I mean, just what we saw a year ago now last March with the downturn due to the pandemic. And so I get where the crisis can come into play, so what some things to think about in the event that we want to try to turn that mindset into more of an opportunity?


John: Yeah, so when we have downturns in the market, a good opportunity is really buying into it. It’s like you have a store that’s going out of business and they have their going out of business sale and you kind of jump in there and see what they have that you can get at a very discounted price. Same thing with stocks.


John: I mean, just to give an example of one, and I kind of use this in the class, because I feel like I’m always there, is Disney. Their stock dropped quite a bit last March when we started to shut down, and that was a great buying opportunity if you had some cash on the sideline to take advantage of it, because it’s really skyrocketed since then. And I’m just using Disney as an example. There’s a lot of other ones as well that we can discuss, but you know, if you’re … position yourself to really take advantage of a market crash, you can really put yourself ahead and when the things rebound. So, there’s definitely some opportunity in market crashes.


Marc: I think people sometimes immediately latch on to the paranoia side of it. But if you had a good plan in place, it might not feel as much of a crisis, I guess.


Nick: You know, one of the conversations that we’ll have with clients as they do shift into retirement, for those that may be a little bit skittish about the market in general, or if we have concerns that some market volatility will kind of derail them from their plan, just maybe overall that the market stresses them out a little bit, what we’ll do is kind of figure out. Like, “Hey, how many months of expenses will make … If we hold X amount of months in cash to cover expenses, will that put you in a place where you’ll feel comfortable?” Because with a crash there’s two parts. Number one is to not bail and to cash out at a loss. Number two is if you have cash handy to put that cash, like John said, and enter it into the market and take advantage of the upside. It can be significant.


Nick: So for clients that are fully retired, being able to have some of that cash set aside to be able to take advantage of opportunities, and also prevent them from acting in a way that is not good for them longterm can be important. And for those clients that are actually still working and still actively saving into accounts, saving on a monthly basis or on a consistent bi-weekly basis helps, whether it be [inaudible 00:08:23] cost averaging is what a lot of people know it as, helps you buy in at times when the market’s low or at a discount, once it bounces back, you can really bounce back in a significant way, and make a difference.


John: Yeah, So another opportunity you can do in a market crash is really do some Roth conversions on IRA assets.


Marc: Good point.


John: So what you would do is … And I think we’ve discussed this in kind of one of our last sessions. But now that this has come back up, it’s probably a good time to bring it up again, is if your IRA balance drops, that could be a good opportunity to convert it and pay less taxes on a lower balance at that point in time.


Marc: Okay. All right. Certainly some good points to think of, and again, we’re trying to show some areas, silver linings, if you will, where something might feel like a crisis or seem like a crisis, but maybe there’s an opportunity there to be had. And of course, a lot of that comes down to, as I mentioned, just having a good plan in place that’ll help you alleviate some of those feelings because you’ll know what to expect as you’re walking into some of these scenarios.


Marc: Number three, guys, maybe a little bit tougher, obviously, to plan for, but still something that has to happen. And this is one that I think just gets avoided mostly because people are afraid to talk about it, but it’s long-term care, and maybe that’s the crisis is the continual rate hikes or something like that.


Nick: Yeah. With clients that have long-term care policies, we try to make sure that we explain, and when we do our classes, we walk through this section. We try to make sure that we explain so that they fully understand that premiums for traditional long-term care policies can go up, and anybody that’s really purchased a policy in the last decade is really starting to see that now. And so, those policies do have what are called non-forfeiture options, so they have the ability to either keep their premium the same and reduce benefits, or pay more and keep their benefits the same. And we really try to take it on a case-by-case basis, but it’s important to take it into consideration and understand because it is absolutely a factor that can impact the overall planning, and is just really another reason that when you’re planning for expenses for clients, building in buffers on expenses and making sure that the plan works well, this is an important space to make sure that you cover.


Marc: Yeah, certainly some good points. And sometimes maybe it’s just a good reminder, a kick in the tush that we sometimes need, to just look at some of the things we’re a little bit afraid of addressing. And nobody likes thinking about it, but it is part of life, so it’s certainly worth having a conversation.


Marc: One more here guys, and that is the crisis, and we saw this obviously a lot in the last 18 months or so of downturns, getting laid off, in this case, whole industries really suffering due to the pandemic. It’s certainly going to be tougher to look for opportunities there, but from a retirement standpoint, and we’re not necessarily talking about people that are in their 20s or 30s or 40s, but from a retirement standpoint, any things we can try to find here to turn that into an opportunity? Maybe getting laid off early, the first thing that would pop into my mind is that if you had a good plan in place, you’d be able to know if that’s necessarily a bad thing or a good thing. It might just be saying, “Okay, well, it’s time for me to go ahead and retire and I know I’m going to be okay.”


John: We’ve seen that situation’s come up recently where we’ve had clients laid off and it’s like, “Hey, Nick, John, let’s get together to do a meeting.” And in the meeting, it’s, “All right, let’s look at how the plan looks without you working currently,” and we find out it doesn’t look as bad as they thought, and it kind of makes them feel a bit better about their current situation.


John: We’ve also had some other scenarios where maybe it doesn’t look great, but it’s, “Hey, you don’t need to go work full time anywhere. You can go find something that you enjoy to do and maybe work part time and the plan still looks solid.” So, that’s something to just keep an eye on is if you are laid off, you don’t necessarily need to get back to the income that you were making before. Maybe you can now go do something else that maybe you enjoy more or a second career, and maybe at part time, your plan still works. And that’s where it’s important to plan ahead and make sure that you have the ability to make decisions and be able to monitor those.


Nick: Yeah, I would add, in reality for somebody that’s within a couple of years of retirement, the money that they are going to save in those years, if they’ve done pretty well up until that point … So, let’s say for example, somebody is planning on retiring at 65 and they get laid off at 63. Well, the money that they were going to save between 63 and 65 wasn’t going to have a huge, huge impact on their overall plan and make it rapidly improve. However, not having to dip into the money that they’ve saved in those couple of years will be important. So kind of along the lines of what John said, it’s like, “Hey, if we can …” We’ll go through the plan and say, “Maybe you’re used to making a hundred grand a year, but if you can find something making 40 or 50 that can help you avoid having to dip into your accounts, let your accounts to continue to grow, and even if you can’t save for these next couple of years, it lets you hold the line, that can be really a win-win and make an impact.”


Nick: So between that and kind of sticking with the fundamentals of trying to make sure that you have six plus months of expenses in cash and really kind of the tried-and-true things from a planning standpoint, can help people get through that. And we’ve also seen people kind of have a sense of relief where they were getting burned out at work. They weren’t really happy there anymore. They didn’t realize how much it was taking out of them and just literally a month or two to regroup kind of refreshes them, and they end up in an opportunity that’s a lot better than the one that they were in anyways.


Marc: Yeah. Some great points for sure. I mean, try to find that opportunity in it. Maybe if you’re lucky enough to have a position where a pension was involved, maybe they’ve offered you a lump sum buyout, whatever the case is, or the monthly. So, it’s worth having those conversations to find out where you stand, because it may not be that crisis that you initially thought it was.


Marc: But it’s the gut punch when you first find that out, sure. But if you’ve got a plan in place or you go and you find out and you have those numbers run, you may certainly find, to the guys’s point, that you could be in better shape than you realized. And it’s interesting that the way you guys phrase that, because my brother’s actually right there now. He’s 63 and he’s going to be … They’re going to be closing up the business here that he works for in the next couple of months. And so he’s at that cusp as well, and he’s like, “Well, I’m going to take a look at my numbers again.” And so he sat down and talked with his advisor, and he’s like, “I think I can just go to part time,” to John’s point, “and just do some things that I want to do now.” There’s a couple of little hobby ideas he’s been thinking about doing.


Marc: So you never know, right? You got to look for the opportunity where you can. And it’s hard to sometimes not focus on the crisis, but with a good strong plan in place, that’ll certainly help you do that. And that’s kind of the whole point. That’s one of the reasons we do the podcast is to shine some light on some areas to think about that.


Marc: And you’ve been listening to Retirement Planning – Redefined. Stop by the website at PFGprivatewealth.com. Check out the guys there. A lot of good tools, tips, and resources. You can contact them to come in for a consultation or review or talk about your situation. You can find the podcast there, subscribe to it that way, or drop us an email here as well on the program. And we’ve got one this week we’re going to wrap up with. Jane has a question for you guys. She says, “It’s about 401k funds. If I don’t use the target date retirement fund, is there a certain number of funds that I should allocate within my 401k? I don’t want to under or over diversify. Is there a right number of funds or does it really just depend?”


John: Our answer to almost everything is, “It always just depends.” It sounds like Jane, she’s not doing the prebuilt kind of option, which is the target date, and is looking just to really build her own portfolio, which is fine. But it’s really more important as far as how many funds you have to get into the right asset classes. So, 401ks do a really good job of making sure that you have a lot of different asset classes to choose from. And when I say asset classes, large cap, small cap, bond funds, international, that’s the way you want to diversify within a portfolio.


John: It really comes down to your risk tolerance, which again, with the 401k platforms, they typically have a questionnaire for you when you sign up or on the website. And then once you determine that, I’m just throwing it out there, if you’re moderate, then you’re going to want a certain mix of those asset classes to make sure you have a good portfolio for you. Easier said than done, so it’s really important to work with a financial professional to make sure that you have the right number of funds and you’re diversified in the right asset classes for your situation.


Marc: All right, there you go. Thank you so much for the question. We certainly appreciate it. And you know, every situation’s a bit different. There’s universal truths to apply to all of us, and that’s one of the reasons, again, we do the podcast to share some of those things, but every situation can be uniquely different when it comes to retirement planning. So, reach out to the team and give them a call if you have some questions at (813) 286-7776.


Marc: Don’t forget to subscribe to us at Retirement Planning – Redefined on Apple, Google, Spotify, iHeart, Stitcher, so on and so forth. You can find all the information at PFGprivatewealth.com. Guys, thanks for your time this week. I appreciate it as always. John, have yourself a great week. Nick, you as well, my friend.


Nick: Thanks, Marc. Thanks.


John: Have a good one. Thanks.


Marc: We’ll talk to you a little bit later here on the program. This is Retirement Planning – Redefined.