Speaker 1 0:04
Stay tuned right now for Retire Smart Maryland, the radio hour from Elite Income Advisors, focused on helping you build a stronger financial future and make the best of your retirement years. Retire Smart Maryland covers income and investment strategies, opportunities to help you grow and protect your wealth. Examining tax-efficient planning techniques and addresses legacy and estate planning considerations. Also, perspectives on the latest financial headlines and what you need to do. It’s time right now for Retire Smart Maryland with Elite Income Advisors.
Speaker 2 0:39
If you’re tired of the same old generic financial playbooks, and you’re ready for the unvarnished truth about your money, you’re in the right place. Welcome to Retire Smart Maryland. I’m Mike Bauer, alongside Prashant Sabapathi of Elite Income Advisors, from the main office in Ellicott City to the satellite location in Annapolis. Everybody at the team is happy to help you in Central Maryland, pre-retirees and retirees to build strategies that actually work in the real world. Prashant, looking forward to the show today. Always good to catch up with you.
Speaker 3 1:07
Good to be back, Mike. I’m excited for today’s show, especially in this first segment. I’ve been getting a lot of questions on Social Security lately. I was actually doing a workshop in our community, and we do a bunch of these workshops. You can always visit eliteincomeadvisors.com to get a list of some of the workshops we’re doing if you think it could make sense for you to attend. But I was having a conversation with somebody who attended one of my workshops about the cost of living with Social Security, and so I figured why not talk about it a little bit on the on the air today and see where that conversation takes us. So it’s been it’s been a great week, a lot of interesting conversations, and really happy to kind of dive into some of this stuff on the show today.
Speaker 2 1:52
And for anybody listening, if you want to have a conversation with Prashant, the number to call 833-856-1387. Have your calendar ready because you get right on his calendar at 833-856-1387. All right, let’s get into it. Big news on the horizon: the cost of living increase. The cola could be the fourth largest increase in the last 36 years, and that sounds like great news until you look at really why it’s happening. Prashant, let’s dig into the truth about Social Security-it sounds like great news on the surface, but why should retirees hold off on celebrating just yet?
Speaker 3 2:27
Well, I think what’s really interesting is you go back to the 8.7% increase that we got a couple years back. This was off the heels of the 2022 inflation crisis, and you know what I heard? I feel like what I heard from a lot of my clients that year is Social Security gave us eight 8.7% Why does it actually feel like my Social Security check didn’t keep up with the cost of living? And that was something that I heard time and time and time again in 2022 2023 timeframe. And so I dived into that, and I found a couple things. Number one, do you remember where the top inflation rate was back in 2022, Mike? Like where it absolutely topped out at per the government’s
Speaker 2 3:13
metric. I mean, it was double digits for sure. Was it somewhere around 14% I don’t know if I’m if I’m remembering. Remember, I think once you wrap
Speaker 3 3:19
in the cost of food and energy, which is oftentimes excluded from core CPI, we were looking at double digits, but the real CPI number that was reported was 9.1% at its highest. But that excludes food and energy, right? So let’s think about this. Inflation topped out at 9.1. Social Security gave us 8.7, and then what happened to the cost of Medicare over the last few years? Here, the cost of Medicare Part B went up, right? And Medicare Part B is paid for directly from your Social Security check. So, if they gave you this cost of living increase, which I would argue didn’t actually keep up with cost of living, and then the price of health care went up, and they sucked that right out of your social security check. Your real increase after all these adjustments, I would argue, didn’t actually go up that much. So if it felt like your social security check didn’t keep up with the cost of living, I’d argue it’s because it didn’t actually keep up with the cost of living, so you can’t only look at one side of this equation. You can’t just look at a 3.9 or potential 4.2% increase and say, “Great, I got a raise. I think you have to look at it from the standpoint of what happened to my real expenses. Did those go up by just 3.9 or 4% And I’ll tell you what I go to the grocery store. I just went over the weekend, and it feels last weekend, and it feels like everything is costing more. You go to the gas pump; it costs more. There was a period of time where maybe oil prices dropped a little bit, but now it feels like with everything going on in Iran. And everywhere else, oil prices are back up, and as a result, we’re paying more at the pump. So I think you have to look at real increases, not nominal increases that are that aren’t adjusted for what your actual expenditures are.
Speaker 2 5:13
Again, for Sean, if we’re talking about percentages and the CPI going up, what are those? You said energy. I mean, those are those are not optional expenses for pretty much everybody listening in terms of the things that are not factored into those big numbers we see on the headlines.
Speaker 3 5:29
Well, I always thought that that was so silly that food and energy prices are excluded from calculation. I don’t know about you, but other than my mortgage, food and energy are the two things I spend the most amount of money on. It’s gas for my car. It’s heating my house. It’s food at the grocery store. Those types of things are inherently going to be higher. I mean, you remember what it’s like like 10 years ago, just going out to eat like for dinner at at a nice restaurant on the weekend. I mean, if businesses are paying more for their supply, you think they’re just going to eat that cost? Of course not. They’re going to pass it on to you, and so the same night out on a Saturday night is going to cost inherently more today than it did a year ago, than it did five years ago, and certainly more than it did 10 years ago. So the way I kind of equated is, you know, imagine getting a bigger bucket to bail water out of your sinking boat, right? Because the leak is getting faster and faster. The bigger bucket doesn’t mean that you’re winning; it just means that you’re losing at a slower rate, right? But eventually, it’s precisely the type of thing that could derail you if it’s not addressed in a in a really meaningful way. So if inflation outpaces your fixed income, a larger check just buys you less lifestyle, not more. But I think it’s hard to kind of pull the layers back and see that in real time as you’re going through it, and so it’s an interesting conversation we’ve been having with a lot of folks.
Speaker 2 7:08
For anybody listening, if you want a clear picture of how your income and taxes stack up against inflation, which apparently doesn’t include energy and food, when we see those numbers on the headlines, Prashant and the team at Elite Income Advisors can run for you. Call 833-856-1387 or visit eliteincomeadvisors.com. Prashant, when when we talk about this as the bigger picture of retirement planning, how does this change the way that people should look at retirement planning as a whole, or the questions they should ask with you when they meet with you?
Speaker 3 7:40
One thing I always ask to people who do spend their their valuable time coming in to visit with me is this idea of hey, do you have an income roadmap written down that you can reference at any given point in time? Like all of our clients have a written income plan that they can reference when things get a little bit tough, so what is a written income plan? It’s a document where you should be able to look at one sheet of paper or one screen on your computer and have at least a rough understanding of how much income you’re going to have coming in each and every month, each and every year for the rest of your lifetime after accounting for taxes after accounting for costs of living, so that’s where I would start. Mike is with a written income plan. If your advisor hasn’t put together a written income plan, or if you’re a do-it-yourselfer that’s never mapped that out, it’s a great opportunity to pick up the phone, give us a call, schedule that no cost, no obligation visit with our team of elite income advisors, the phone number it’s 833-856-1387. That’s 833-856-1387. If you’re looking at next year’s cost of living adjustments and hoping that it finally gives you gives your retirement the breathing room that you need, let’s take a look at actual numbers, actual math, and let’s map out that income plan so that you have the confidence to retire the way that you deserve after 30 or 40 years of hard work. Free appointment. It starts with that phone call. It’s 833-856-1387.
Speaker 4 9:19
How do you really know if you’re ready for retirement. Is it a number in your account? A certain age? Maybe a feeling? Hey, the truth is, retirement planning usually comes down to whether all the pieces are working together: income, investments, taxes, healthcare planning, also long-term goals. The team at Elite Income Advisors they help people evaluate where they stand today, and they identify areas that may need attention before retirement begins. So, call the team at Elite Income Advisors today for your complimentary retirement readiness review at 833-856-1387. That’s 833-856-1387.
Speaker 1 10:00
Some financial representatives are required to work within a corporate system, and others have the flexibility to work beyond it. In some environments, advisors may be limited to certain tools, products, or approaches, often shaped by the structure of the organization they represent. It can influence how recommendations are made and how strategies are built over time. Independent financial advisors may have the ability to evaluate a broader range of options based on a client’s specific situation. When you’re planning for retirement, that flexibility can play a role in how your income strategy, tax planning, and investment decisions come together. Because your financial life isn’t a one-size-fits-all solution, and the strategy built around it shouldn’t be either. Elite Income Advisors operates as an independent financial advisory firm focused on building retirement strategies around your goals, your timeline, and your financial situation. Elite Income Advisors’ objective is to provide guidance that is clear, objective, and aligned with what matters most to you. So call Elite Income Advisors today from Retire Smart Maryland and schedule your complimentary retirement review. 833-856-1387. That’s 833-856-1387. Or go to their website Elite Income advisors.com.
Speaker 2 11:16
On Retire Smart Maryland, we just talked about how a bigger cola number isn’t necessarily a bigger win, and unfortunately, Prashant, that’s not the only trap. I’m Mike Bauer, joined by Prashant Sabapathi of Elite Income Advisors. You can reach them at 833-856-1387, or head to eliteincomeadvisors.com. Set up a no cost, no obligation visit. And for anybody listening out there, you know, has maybe researched when to start Social Security. Type that into Google or some sort of AI, and you’ve run into the idea, and probably they spit this out. A break-even age, Prashant, and that’s the age where waiting starts to pay off versus claiming early. And it it sounds pretty simple, but it’s rarely the whole story. Getting the decision wrong can absolutely affect a family for decades. So, Prashant, aside from my tiny little Cliff Notes version, what is a break-even age, and why isn’t it really the whole picture?
Speaker 3 12:09
So, the break-even age is how long you have to live in order to justify your collection decision. So, hypothetically, let’s just say that you were considering collecting at 62 years old, and you want to evaluate whether collecting at 62 or say 66 is the more appropriate decision. Well, one thing you would look at, and one factor shouldn’t be the end all be all, in my opinion, but one factor is the break even. So hypothetically, let’s just assume that the break even is about 74 and a half years old. What that means is that if you collected at 62, and you outlive 74 and a half, you could have, in theory, gotten more income by delaying your benefit till 66. Okay. Now, if you pass away prior to 74 and a half, then guess what? You made the right decision to go ahead and collect early. Okay, so you see the problem with just looking at the break even is you got to know exactly when you’re going to die in order to understand whether or not you made the right decision. The problem is we don’t get that information until it actually happens, right? So then the second thing to look at is what if you looked at a break-even hypothetically and it said, “Hey, wait till 70 because you have great family history, have great health, and so maybe waiting till 70 is the right thing for you to do. Well, what happens if you want to retire when you’re 65? I’d argue you still need a paycheck, you still need income coming in, and if you’re going to delay Social Security until 70, that means you have to have enough pension income, enough other savings, whether it’s in an IRA, a 401k, or a Roth. You need to have that set aside in a safe place to draw income off of while you bridge till 70 years old. So if you don’t have enough of a nest egg to make it over that period of time. Collecting at 70 might be the best strategy from a break-even standpoint, but it might not be the best strategy for you. And so this goes back to what I’ve said for years, and that is when you go to file Social Security, the one thing that you cannot file without is confidence. You need to have confidence that you are making the correct decision for you and your family, especially if you’re married. Simply because once you make that decision, you don’t get too many do overs. You got to get it right the first time. It’s potentially a million dollar or more lifetime income decision, and so I think if I was dealing with a million dollars, which I do every day with my clients, it deserves a heck of a lot of care and attention. And what I found, Mike, is people for whatever reason don’t view it that way, and they make really impulsive decisions that. Could end up costing them to the tune of 10s, if not hundreds of 1000s of dollars over the course of their lifetime. And so, I mentioned this first visit. You schedule that appointment. By the way, that phone number it’s 833-856-1387. You dial that phone number. Just come in and chat with us. You’re not agreeing to become a client. What you are doing though is figuring out a couple things. One, we’re going to talk about this decision with Social Security. We’ll actually be able to run you a free report. I’ll print it out for you and send it home with you the very first time you come into the office. It’ll help you untangle the mess that is Social Security. That’s number one, and I think when you have a report like that, it’ll give you the confidence you need to make the right decision for you and your family. But number two, when you come in for that appointment, you’re not committing to anything. You’re trying to figure out whether or not me and my team are even the right match for you. If we find a mutual good fit, maybe we’ll find an opportunity to work together professionally. But if we don’t, it’s not the end of the world. We’ll simply go our separate ways, and there’s no hard feelings.
Speaker 2 16:03
Prashant, what do you say to somebody who says, “You know what? I’m going to take it as soon as I can. I’m going to get it right off the bat. Take it early, and I’m going to invest the difference in you know one of a million different directions. But what do you say to somebody that that comes to you and says, “You know what? That’s what I want to do. I
Speaker 3 16:18
want to understand how we got to that decision making process to begin with. By the way, I have a lot of clients that do just that. I’m not saying that there’s anything wrong with doing it that way. And really, my own curiosity, I like to understand how people made the decision. Is it because we’re scared of Social Security running out of money one day, which the solvency reports show that there will be a shortfall in the future. Is it because we feel like, hey, we paid a ton of taxes for this benefit over the course of our career, and we’re not going to let one day go by that we don’t get to harness the tax money that we put in? By the way, also very legitimate point of view to have. Is it because we truly believe that’s going to yield us the highest amount of lifetime income? And so, without saying yes, no, right, wrong, I think what I would do is understand what goes into that decision-making process. I think another thing to look at is if we are going to collect our benefit early, like at 62 or before our full retirement age. I think we have to ask the question: Are we still going to work during that period of time? Because there is an earnings test, you can’t collect Social Security and earn more than a certain amount of money, which it’s you know approximately. Don’t quote me on the number, but it’s around $24,000 per year. If you’re earning in excess of that, you might find yourself in a situation where you’re paying back benefits. So I think how we got to the decision absolutely matters, and it’s critical in determining whether or not that is the actual right decision for you.
Speaker 2 17:49
And I’m sure there are many people listening that that think about it exactly like you did in terms of okay, I’m going to retire from my day job, the one that I’ve been doing for years and years, but I want to do something on the side, and that’s an important question to bring up when you are talking with Prashant and the team at Elite Income Advisors. You can reach them 833-856-1387 or [email protected]. So spouses are often part of the equation when it comes to when do I take Social Security because they are going to get it as well. So, how does this decision of when to turn on Social Security change when you’re obviously in a in a relationship and your spouse is part of the equation?
Speaker 3 18:31
I think you have to coordinate both benefits together. Okay, the first thing that comes to mind is survivor benefits, and I can’t, for what it’s worth, I can’t stand the terminology they use, calling these things survivor benefits. I don’t know if you know anything about Social Security. When one spouse passes away, you typically, in most cases, will lose the lower of the two benefits. So let’s say I have Spouse A collecting 50,000 a year Social Security, Spouse B collecting 40,000 a year Social Security spouse A, the higher benefit dies first. Spouse B loses their own 40,000 and takes Spouse A’s 50,000, and that is what is called the widows or survivors benefit. And to this day, I haven’t been able to figure it out, Mike, how we lose one of the incomes, and yet that is supposed to be a benefit to me, right? And so, with that being said, I think couples avoid talking about things surrounding morbidity and mortality, things like long-term care, estate distribution, what happens if one spouse passes away first, and we avoid that simply because it is uncomfortable, and avoiding those survivorship conversations is kind of like driving on a road trip across the country and refusing to look at a map or discuss who takes the wheel if somebody gets sick. Right? If there’s an emergency, you don’t want the other spouse flying blind, and so it’s not. Enough to just understand how you are going to collect your own social security benefit. I think you have to consider survivor benefits if you’re married and how you collect benefits as a couple to make sure that you are optimizing it for your situation. And by the way, that applies if you are married, and that applies if you are divorced. So if you were married and divorced, you might actually have access to what are called ex-sposal benefits, which could give you the opportunity to increase your Social Security payment based on the work record of your ex-spouse. A lot of moving parts to that. So many people do not map this stuff out. Please make sure that you have a comprehensive and coordinated Social Security plan. When we run that Social Security timing report for you, it will include considerations based on what-not just what you’re doing, but what your spouse is doing as well.
Speaker 2 20:53
You know, and Prashant, as you mentioned, you rule number one: one thing is you cannot file without confidence. So, for anybody listening, before you make that decision, make sure you can do it with confidence. Set up a visit with the team at Elite Income Advisors online at Elite Income advisors.com. You can also go 833-856-1387. All right, Social Security is not tax free income. How do you help people figure out what impact taxes are going to have-not on everything, but on this specific element of taxes when it comes to Social Security in retirement.
Speaker 3 21:29
Look, believe it or not, Social Security could be totally tax-free depending on your income. But for most of our clients, like I’d say the majority, probably well over 95% of our clients, Social Security will be taxable in some form or fashion. Now, how much you pay taxes on is going to depend on things like your total provisional income. One thing we know for certain, Mike, is that at worst, even for the person earning the highest level of income, 15% of the benefit is going to be federally income tax free, but I think there’s been a lot of news and and talk on the kind of mainstream media just about is Social Security tax free. I know that comes up every political cycle. The answer is it could be tax free, but for most of you, you will pay federal income tax on it. And so the question then becomes how much federal income tax? Which, in order to determine that, it is a function of your total income situation. And so, when we map out that written income for life roadmap that I was talking about in the first segment, understanding all of your sources of income will help you understand whether or not your Social Security benefit is actually taxable, so it’s actually super easy when you map out your income and see it all in one place. You can go through every source of income and say this is taxable, this is taxable, this is non-taxable, this is partially taxable, and all of that data together is what allows you to understand whether or not your Social Security benefit is actually taxable. Some of you will find that you might not pay taxes on a tremendous piece of your Social Security benefit. Others will find that the full 85% that could be taxable is taxable. And I think untangling that mystery is ultimately what becomes one of the more important pieces to your Social Security planning. Listen, if you’re married and listening right now, if you’re single, worried about when to take your Social Security, it’s a great opportunity to pick up the phone and give us a call. I have operators, by the way, standing by. They’re ready to take your phone call. So when you call in, make sure you have your calendar in front of you because they’re going to help you schedule that appointment. You’ll either come into our Ellicott City or Annapolis offices, or you can book a virtual phone call or Zoom call with us. And all you’re doing is setting up that first visit to talk through the specific concerns that you have. The phone number is 833-856-1387. That’s 833-856-1387. It is no cost, no obligation to simply come in, sit down, and talk about the things that are most important to you, your family, and your future. So pick up the phone, give us a call, have your calendar ready, and let’s get you in the office and let’s have a conversation about your retirement. 833-856-1387.
Speaker 4 24:30
Call the team at Elite Income Advisors for your personalized retirement strategy right now at 833-856-1387. Nobody wants to feel like their retirement plan came off an assembly line. Your life is different. Your goals are different. Your concerns are different. Your financial strategy should also reflect all that stuff. The team at Elite Income Advisors-they take the time to understand what matters most to you, and they build retirement strategies designed around you. Your lifestyle, your priorities, and your long-term goals. Call Elite Income Advisors today for that free financial plan review. 833 850-613-8071. more time. 833-856-1387.
Speaker 1 25:16
When you take Social Security can affect more than just when the checks begin. You’ve paid into Social Security for decades, so how do you know when to take it to get the most out of it? On the surface, it may seem like an easy call, but your benefit amount can vary depending on when you claim. If you’re married, your decision could affect your spouse as well, and depending on your overall income, a portion of those benefits may be subject to taxes. So it’s not just about picking a date, it’s about how that decision fits into your overall retirement income plan. How will Social Security work alongside your other accounts, your investments, not just today but years down the road? These are the kinds of decisions that can benefit from a coordinated approach. Elite Income Advisors and Retire Smart Maryland works with individuals to evaluate Social Security timing and the strategies as part of a broader retirement plan, helping bring clarity to how these pieces may fit together. So call Elite Income Advisors today to get your free Social Security and retirement income review. 833-856-1387. That’s 833-856-1387, or schedule your time at their website, eliteincomadvisors.com.
Speaker 4 26:24
Hey, if you want to retire soon, then here’s something that you may not realize until it happens: taxes. They can affect almost every part of your retirement income, your IRA withdrawals, your Social Security required minimum distributions. It all starts working together once retirement begins, that’s why Elite Income Advisors-they help people build retirement income plans that also take taxes into account. Because the goal isn’t just creating income; it’s helping you keep more of it. Call today for your complimentary tax reduction review at 833-856-1387. That’s 833-856-1387.
Speaker 2 27:05
Thank you so much for listening to Retire Smart Maryland. I’m Mike Bauer, joined by Prashant Sabapathi of Elite Income Advisors, main location in Ellicott City, but they also have a satellite location conveniently located in Annapolis, and they’re conveniently located online. Love a good website, eliteincomeadvisors.com. Love when it matches. You don’t have to type in any crazy letters, eliteincomeadvisors.com, and let’s let’s get into a conversation that I’m sure you have a lot, or maybe you don’t have it necessarily, but you see others having it. Where two spouses with completely different ideas about money. Walk through the door. They’re meeting with you at Elite Income Advisors, and they are hypothetically, let’s just say, not on the same page. One’s conservative. One wants to stay invested. One wants to retire. The other one wants to keep working. I’m sure these are situations that you see all the time, Prashant, where two come in and they’re not on the same page.
Speaker 3 28:02
Yeah, I mean, look, I literally ran into this this past week. Actually, had a client and they’re on the same page in terms of when they want to retire and what their life will look like when they retire. But they are fundamentally on different pages. One of them has retirement accounts and they want to grow their retirement accounts to a certain balance. Okay, the other one has been just saving money, but cannot stand the market. Doesn’t want to be in the market. Got burned really badly in 2008, and as a result, has avoided the market ever since. Now, who’s to say who’s right and who’s wrong? I’d say, look, it’s not for any advisor to say how you should feel about your money. I mean, you worked hard for it, you accumulated it, you deserve to feel how you’re going to feel about your money. I think what is more complicated when we’re on differing pages here is figuring out how to coordinate it all together to strike the appropriate balance to make sure that at the end of the day, your plan works. Okay, I think most of our clients who are 1015, 20 years into retirement, they don’t look back. If I had to guess, they’re not going to look back and say, “I wish that I was invested a little bit more, or hey, I wish that I put a little bit more money in this annuity, or hey, I wish that I had bought a CD instead of being in the market, right? Like, I think they look back and say, “Did my retirement turn out to be everything that I wanted to be, and then some? If the answer is yes, then our plan worked. Yes, we can always go back and second guess any individual decision, but I think most people just want to know that they’re going to be okay, Mike. And so, what is the best way to accomplish that goal while maintaining the security that people feel by wanting to be in the market, wanting to not be in the market? Everything is unique. To each person, but let’s just make sure that your plan works. And I think when you can demonstrate that a financial plan is going to work, it allows space for couples to be on different pages working to the same end goal. So it’s okay if you’re on different pages than your spouse. That’s actually very common. I think the question is, how do we work through that to create a plan that actually is successful at the end of the day.
Speaker 2 30:23
You know, Prashant, when when you’re sitting down with couples, and I’m sure you ask a lot of questions, and maybe one of the hypothetical questions is, well, you know, you ask to to spouse A, you say, would you be comfortable with if this happened in the market? Let’s say it’s a 15 20% drop in the market, and then you ask the same question to the to the other spouse, spouse B. You maybe maybe they look at each other a little bit, but I’m sure over your years of experience, Prashant, you’ve seen the look on the face of spouse B when spouse A gets that question of like, okay, what are they going to say? Are they comfortable? Because they they don’t know necessarily. Maybe they haven’t had this conversation themselves, and I mean, do you ever feel like in those situations, especially when you’re talking about risk, that maybe you turn into a little bit of a couples counselor for shot, where you get oh, I’m reading off of your face that you’re not comfortable with his answer.
Speaker 3 31:17
Yeah, look, I I have run into that, and it highlights a bigger point, which is not that necessarily they’re on different pages; it’s that they just don’t know what page the other is on. And what we end up finding when we just put it out, pull it, put it all out into the open, and like design the income plan, design the investment plan, design the estate plan, is that for married couples? You’ll probably be on the same page more than you think. I mean, there. Hopefully, there’s a reason you got married in the first place, right? Right. You are on the same page on a lot of really important things. It’s just natural that the the the more you dig into it, the more you will find that there is a sense of commonality, a sense of agreement between each other, and it’s just never been talked about. And so, I think that’s one of the coolest things about what I do. And by the way, this applies to people that become clients of elite income. This applies to people who don’t become clients of elite income, I’ve met with so many couples who never ended up doing business with us. Who will still send me a note or send me an email afterwards, just saying, “Hey, thanks. You forced us to think about things in a way that we never thought about it. And even though we didn’t work together, it was still a valuable interaction. And so I think that’s one of the neatest parts of what we do here at our firm, and I think you have to have these conversations. You have to get out in front of it. One a good friend of mine, he’s another advisor in the industry down in North Carolina. He always told me, like this was years ago. He’s somewhat of a mentor to me, but he always used to say that when there’s a hurricane or there’s a flood, it’s too late to find shelter at that point in time when you’re in the middle of it. Like you should have a plan for where you’re going to go when there’s a hurricane, right? And that’s what having these conversations are proactive. Like you don’t want to find yourself where your spouse gets sick, or your spouse passes away, or something in your life happens that forces you to make a decision really quickly, and you haven’t considered what the outcome is. And so, I refuse to put my clients in that situation. I would rather talk about the hard things up front, so that when they happen, we can say we’ve already had a conversation. We know generally how people feel, which makes the decision-making process a heck of a lot less burdensome. And I think that’s so important.
Speaker 2 33:52
Love that truth over comfort. I mean, truth right there. And and you know, Prashant, as you mentioned, when the hurricane comes is not the time to go get toilet paper. That’s not the right time. The time is before that. The shelves are going to be empty if that’s the case. One thing that is the case in many relationships is you just generally one person is kind of the financial point person, and the other person is I don’t want to say along for the ride, but doesn’t have as much involvement or as much responsibility when it comes to looking at finances. How does that come into the conversation when you’re sitting down with couples and talking about retirement?
Speaker 3 34:28
I’m very straightforward. I prefer to operate with a style of transparency. Like in our first visit, one of the things that we will talk about is like, look, let’s say that you could make tweaks to your financial plan to accomplish X and Y and Z. Let’s say that we were to recommend that you do X or Y with your money, move your money to this account, move your money, and convert it to a Roth IRA or something of that nature. How would you go about making the decision? Like, is it something that you guys talk about together? Is it something that you need to run by a third party? Do you already have an advisor that you need to run it by before you make a decision? And so, like, I prefer to have these conversations about decision making up front, right? So often I’d see a married couple, but only one spouse comes to the appointment, and that’s okay if that works for you. But one thing we’re definitely going to do is I’m going to ask you, like, how is your spouse going to feel if you make the decision without them? Like, I know how my spouse would feel, even though I handle a lot of our financial stuff and she handles a lot of our healthcare and household stuff. We still run every major decision by each other to make sure that we’re 100 on the same page. And so, I think understanding decision making dynamics is an important part of the financial planning process. I’m okay if one spouse makes all the decisions. I just want to make sure that the second spouse doesn’t feel excluded, or doesn’t feel that something was done without their knowledge or consent. And so, being on the same page on this type of thing, we try to get out in front of that. This is what that first appointment is for. It’s not for us to give you advice. It’s to determine how you make decisions and whether or not me and my team are even the right fit as one piece of your financial dream team, so to speak, and so you know it’s an interesting conversation. And based on the reactions I get, Mike, it’s a conversation that a lot of people have never had before. So it it makes for a lot of very thought provoking conversation.
Speaker 2 36:37
Yeah, you know, I I saw that a Merrill Lynch study recently found 56% of widows and widowers wish they had been more involved in the financial planning conversation during their marriage, and the number rises among those widowed before age 70 as well. Women statistically more likely to outlive husbands. There’s probably a lot of reasons there. I mean, I’m I’m a married husband, and I also like skydiving, and you know, standing way too close to the grill on a hot day. So yes, I’ve I can maybe see where those where those numbers come from. But if somebody wants to come in, whether it’s themself, it’s them and their spouse, and meet with you and have that first meeting, Prashant, how do they do that?
Speaker 3 37:16
Super simple. We made it really easy. Okay, as long as you’re not driving, listening to the show right now. The phone number is 833-856-1387. Go to Spotify. You can check out if you are driving. You want that number. You can always check us out on the internet. Go on Spotify. Search Retire Smart Maryland. Apple Music. Retire Smart Maryland. Get the number there. It’s 856 1387. Schedule that no cost, no obligation, confidential conversation with me and my team. Schedule it now. Our time slots go really quickly. We’ve opened up the next two weeks here for appointments. So call in, get in the office. Let’s talk about your situation and figure or not figure out whether or not you are on track for the retirement you deserve.
Speaker 1 38:05
Over the years, the market has gone through cycles, large gains, sharp drops, unexpected events, and periods of uncertainty. And while stock markets have historically recovered, the important question becomes: Does your timeline allow for recovery? If you’re getting closer to retirement or already relying on your investments for income, market volatility can affect you very differently than years ago. Losses can carry more weight, especially when withdraws are part of the equation. The investment focus adjusts from simply growing assets to helping protect what you’ve built, not by guessing what the market will do next, but by understanding how your investments are positioned today for tomorrow. Claim your free portfolio risk report and protection review right now from Elite Income Advisors 833-856-1387. Elite Income Advisors will review your investments to identify areas that may be exposed to unnecessary risk and explore strategies designed to better align with your stage of life and income needs, claim your free portfolio risk report and protection review at 833-856-1387. That’s 833-856-1387, or go to the website eliteincomeadvisors.com.
Speaker 4 39:17
Call the team at Elite Income Advisors for your free written income plan right now 833 850-613-8071. of the biggest fears people have about retirements-it’s pretty simple: running out of money. Because retirement today could last 25 or even 30 years, and people wonder all the time whether their savings will really support them throughout all those years, including the healthcare costs and everything else that life throws at you, the team at Elite Income Advisors they help people create income-focused retirement plans designed to help bring more confidence and clarity to the future. Call the team at Elite Income Advisors today 833 850-613-8071. more time. 833-856-1387, or visit eliteincomeadvisors.com.
Speaker 2 40:10
Thank you so much for listening to Retire Smart Maryland. I’m Mike Bauer, joined by Prashant Sabapathi of Elite Income Advisors, and we’re talking real answers for your money. And right now, one of the biggest wild cards in retirement planning, Prashant, is healthcare. For anybody listening, you spent 30 or 40 years laser focused, putting money away, doing the right thing, but you might not have taken as much time thinking about what it costs to stay healthy once you get there and are actually working from your nest egg, not working for your nest egg, so Prashant, I’m guessing a lot of people assume Medicare is a safety net. It catches everything. It’s a finish line. You’re good, but it’s it really is just a starting line. So when somebody says to you, Prashant, I’ll just go on Medicare and I’ll figure it out. What’s the blind spot they’re missing there? A
Speaker 3 40:58
couple things come to mind here. So number one is integrating how primary and secondary insurance work together as a part of your overall healthcare plan when you get to retirement. So that’s blind spot number one because obviously you’re going to look at Medicare, which comes in Part A, Part B, and Part D, and then you’re going to look at things like Medicare supplements, or potentially Medigap policies, or even Medicare Advantage plans. So with so many different options out there, I think integrating primary coverage like Medicare with secondary coverage becomes an important piece just purely from a healthcare standpoint. Okay, that’s blind spot number one, and there’s a lot that goes into that. It’s not quite as simple as just saying, “Hey, I’ll get to 65 and figure it out. I think the second thing, Mike, this one’s really interesting, is there’s this big misconception out there I’ve found with affluent retirees. So let’s say if you’ve saved north of let’s say $750,000 for retirement, I think there’s this misconception that because we have been paying Medicare taxes throughout the course of our entire career, when we get to 65, we retire, we transition to Medicare, that the pure cost of our health care in retirement will go down. I mean, that’s what I would think if I had no prior knowledge, because I thought that’s what I was paying all these taxes for, is to have good social safety net insurance when I get to retirement. And of course, what we are finding is that by the time you rope in the cost of Medicare Part B, Medicare supplements, Medicare Part D prescription drugs, and the threat of Irma. Irma is the income-related monthly adjusted amount, which is a surcharge on your Medicare Part B based on your income. We’re finding it might be anecdotal, or there might be a trend that a lot of our clients who are affluent end up paying so much more than they expect to pay for Medicare when they get to age 65 and older, and that is a function of them doing a really good job saving money, which seems, for lack of a better word, ridiculous to me when I get to retirement. So, with that being said, there are things you can do to potentially reduce the cost of your healthcare in retirement. However, you have to be proactive about it, not reactive. And so, so much of the financial planning conversation exists outside of just investments, social security, and tax. You have to rope healthcare planning into the overall financial picture. If you haven’t done that, or if your advisor has never talked to you about Medicare or Irma, I think it’s a fair question to ask whether or not you’re actually working with a retirement specialist. Okay, and if you don’t know, could be a great opportunity to just get a second look at it to figure out whether or not you’re truly on track,
Speaker 2 44:02
you know. And you mentioned to be proactive rather than reactive. The first step in being proactive is give Prashant and the team at Elite Income Advisors a call 833-856-1387. They can help walk you through everything from the Part Bs to the Part Ds to Medicare to Advantage to Original, all of that, eliteincomeadvisors.com is the website. But like I said, the number again is 833-856-1387. Really appreciate you helping pull back the curtain on the true cost of healthcare, Prashant, and helping people get a clear understanding of how these costs impact their specific timelines. If you want an individual take on that, just give Prashant a call. Get on the calendar. Speaking of timing, timing is very important in terms of enrolling for Medicare. What do folks listening right now to Retire Smart Maryland need to know about enrollment timing, and even more potentially important potential penalties?
Speaker 3 45:00
Look, I I’m not gonna say that I’m an expert on Medicare or anything like that, but here’s what most of our clients will do as they are approaching 65. So let’s say a year or so before 65, we start to have a Medicare focused conversation, not necessarily about what supplements you’re gonna take or that type of thing, but just to get you prepared for what potential costs could end up looking like, whether or not you’re going to retire, all that stuff plays a role in how to have the Medicare conversation. Now, what is typical is three months before your 65th birthday, you can kind of start the process of figuring out how to get enrolled in Medicare, and then you have up until approximately three months after you turn 65. Once you start to bridge past that period of time, you could be subjected to additional penalties for not enrolling. So my advice is: at first, sit down with your retirement advisor to figure out what the general Medicare landscape is going to look like, and then from there get hooked up with a Medicare specialist. Which I can refer you to a Medicare specialist. I’m not a Medicare specialist. I don’t sell Medicare supplements or anything. I have no kind of horse in that race. But what I can do is I can refer you to someone who can help you with that healthcare planning piece of it, and I think you want to start that process up to a year ahead of time, but really with a target enrollment of three months before to about three months after your 65th birthday.
Speaker 2 46:37
Yeah, and I mean, and if you enroll late, if you miss that, you know, you think, hey, I’m just got you. I’ll I’ll take care of it later. I’ll take care of it later. Well, later can cost you permanent and compounding enrollment penalties if you get in late. So get with Prashant sooner rather than later, so you don’t subject yourself to those permanent and compounding penalties. Long-term care. When we’re talking about Medicare, long-term care is part of the conversation, but it’s actually a whole separate conversation. How does that work, Prashant?
Speaker 3 47:05
This is another blind spot, I would say, Mike. It’s people think that because they paid so much in Medicare taxes, that if they went to a nursing home or got sick, that long-term care would just be covered by the federal government. Not really the case, and if you’ve watched me on television or if you’ve been listening to the radio show for quite some time, you’ve probably heard my story about my mom, who was 57 years old, and at 57 she was diagnosed with dementia, and so obviously very young to be diagnosed with something like that. She struggled with dementia for eight years. The last four years, four to five years of her life, required extensive long-term care. We chose to do it in a home health care setting, but our family was outputting anywhere from 8000 to $12,000 every month just to take care of my mom, and so before she passed away, we estimated that we spent out of pocket probably anywhere from 400 to maybe $700,000 out of pocket to deal with long term care costs. So I think the natural question is if it happened to you, and the government didn’t pick up a piece of that tab. What would that do to your retirement plan? Are you able to support 8000 or $10,000 per month after taxes in additional cost? If the answer is yes, great. But now are you at undue risk of running out of money sooner than you anticipated? If the answer is no. I don’t think I could absorb eight to 10,000 potentially of additional costs. What do we do about it at that point in time? Right. So everything is integrated. Medicare can cover pieces of long-term care, but certainly does not cover all of it, and it’s only typically for a limited period of time. If it happened to you, how are you going to deal with it? If you don’t have the answer to that question, or if you don’t even know how to start thinking about the answer to that question, written income plan is the way to go. When you have an idea of how much income you’re going to have coming in, and whether or not you’re running an income gap or an income surplus, it starts to allow you the opportunity to answer some of these questions. Yet, so many people that we visit with have no clue where to start. If you find yourself in that boat, just give us a call, folks. It’s 833-856-1387. Mike, it’s also a really good opportunity for people to get a free copy of my book. I actually talk about long-term care in the book. There’s a website that I created, folks. It’s retiremaryland.com. That’s www.retiremaryland.com. If you visit retiremaryland.com, fill out a quick questionnaire. I will take care of all the shipping and the handling. I got a great team. They will send you a free. Copy of my book. It’s called Fiscal Health Retirement Wealth. It’s your prescription for income generation, tax management, financial peace of mind. It’s an easy read, less than 100 pages. You’ll be able to read it in one sitting. Share it with your friends. Get your free copy. retiremaryland.com, and then to schedule your appointment, call us 833-856-1387.
Speaker 2 50:24
All right, I’m spoiler alert for anybody listening right now. I’m going to go to the last page of the book, and I’m going to read a quote from you, Prashant. Last page of the book, and I think it sums up exactly what we talked about here. And we’ll end with Nike on this, but create a comprehensive and coordinated plan. This is literally the last page of the book because your withdrawals affect your taxes and income and peace of mind. Get a plan that looks at the whole picture and includes everything: investment, taxes, social security, income, Medicare, like we’ve talked about in this segment, RMDs, and your hopes and your dreams. And then you finish with Nike. Just do it. So just do it. Go online retiremaryland.com is how you get a hold of that book, and you can read the rest of the book. It’s very valuable. I just wanted to zoom to the end because I know that you close as we’re talking in this segment, closing a Medicare focus segment. You actually close the book talking about just that. Retiremaryland.com is where you get the book, or as Prashant mentioned, set up a visit. You can head in, have a one-on-one conversation with him and the amazing team at Elite Income Advisors at Ellicott City. You could set up a meeting in Annapolis as well. They do also meet virtually, EliteIncomeAdvisors.com, or just pick up the phone and call 833-856-1387 on behalf of Prashant and the whole team at Elite Income Advisors, I’m Mike Bauer. Thanks for listening. We’ll see you next time.
Speaker 4 51:47
You know, retirement worries-they’re different for everybody. For some people, it’s do we actually have enough money? For others, it’s healthcare costs, it’s taxes, it’s market swings, or just not having a clear plan in place. And honestly, a lot of people are carrying those concerns around quietly. Elite Income Advisors-they sit people down, they help organize the big picture for you, and they make retirement strategies designed around real-life goals and concerns, not just generic advice. Call the team at Elite Income Advisors today at 833-856-1387 to get started on your complimentary written financial plan, that’s 833-856-1387. Annuity guarantees are subject to the claims paying ability of the issuing insurance company. If you withdraw money from or surrender your contract within a certain period of time after investing, the insurance company may assess a surrender charge. Withdrawals may be subject to tax penalties and income taxes. Persons selling annuities and other insurance products receive compensation for these transactions. Products are subject to fees and additional expenses. Any comments regarding safe and secure investments and guaranteed income streams refer only to the fixed insurance products. They do not refer in any way to securities or investment advisory products. Information presented on this program is believed to be factual and up to date, but we do not guarantee its accuracy, and it should not be regarded as complete analysis of the subjects discussed. Discussion should not be construed as an offer to buy or sell, or a solicitation of an offer to buy or sell the investments mentioned. Professional advisors should be consulted before implementing any of the strategies discussed. Investments involve varying degrees of risk, and there can be no assurance that any specific investment or strategy will be suitable or profitable for a client’s portfolio. Investment Advisory Services offered through Elite Income Advisors Incorporated, a registered investment advisor located in Ellicott City, Maryland. The firm only conducts business in states and jurisdictions in which they are properly registered or exempt from registration requirements. Registration is not an endorsement of the firm by securities regulators, and does not mean the advisor has achieved a specific level of skill or ability. Content should not be viewed as personalized financial advice. Insurance and annuity products are sold separately through Retirement Planning Services Incorporated. Neither firm is affiliated with or endorsed by the Social Security Administration or the IRS. Social Security, Medicare, pension, and tax rules are subject to change at any time. Insurance and annuity products are sold separately through Retirement Planning Services Incorporated. President Ozer Culhagil, Prashant Sabapathi, and Jonathan DeFeo receive commissions for the sale of insurance products as insurance agents for Retirement Planning Services Incorporated. Insurance and annuity product guarantees are subject to the financial strength and claims-paying ability of the issuing insurance company. Morgan Patrick is not a client of or affiliated with Elite Income Advisors. However, he has a financial incentive to promote our services because he was compensated for his work on Retire Smart Maryland. The program is paid production of Elite Income Advisors.
