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Everyone has a different reason, goal or something they want to accomplish in retirement. Let’s explore some of the various motivations people have in retirement and how your financial advisor can help you accomplish what you set out to do. Important Links Website: http://www.yourplanningpros.com Call: 844-707-7381 ----more---- Transcript Of Today's Show: Speaker 1: Hey, everybody. Welcome into another edition of Plan With the Tax Man. Thanks for hanging out with Tony Mauro and myself as we talk investing, finance, and retirement. And this week on the podcast, what kind of retirement are you living for? Speaker 1: Everybody's got a different reason or a goal or something that they hopefully want to accomplish in retirement. So let's explore some motivations that people have, Tony, in retirement, and how you guys go about doing what you do to help them accomplish said goals and said things. And we'll dive into that this week. What's going on, my friend? How are you? Tony Mauro: I'm good. Getting ready to go on a little midsummer vacation here in Wyoming. Yeah. This hits home with me. I'm not, of course retired, but we like to travel. So it's always important that we get out and do that. Speaker 1: Gotcha. Where are you going in Wyoming? Tony Mauro: We're going up to Brush Creek, which is a kind of a working cattle ranch type thing. Speaker 1: Okay. Tony Mauro: So it's an all inclusive. It's right just west of Laramie. Speaker 1: Yep, gotcha. Tony Mauro: I don't know about an hour or two, I think. But it looks great. It looks fun. A lot outdoor stuff. Speaker 1: Very cool. My in-laws are from Wyoming, so I'm versed. They live there and we go out every so often and see them and we meet them in Grand Teton over in Jackson, so. Tony Mauro: Yeah. Speaker 1: Yeah, it's Jackson. Because if you say Jackson Hole, they go, "No, no, no. It's not Jackson Hole." Even though I think the rest of the country sometimes refers to it that way. The first time we went there and I said, "Looking forward to seeing all the stuff that Jackson Hole has to offer," the lady at the diner was like, "No honey. It's just Jackson." And I was like, "Oh, okay. Well, the sign said Jackson Hole, but whatever." So yeah, no, it's beautiful out there though. Speaker 1: I will say this. If you don't like the cold and of course, you and I were talking about snow and cold right before we got started, do not go to Wyoming in February. I have lived in Chicago and New Jersey and Detroit. I've lived in some cold areas and some windy areas, but I have never experienced anything like the cold that it is Wyoming in the month of February. Tony Mauro: Well, I went skiing in Jackson Hole. I mean, at least at that place in Jackson. But I went in December, and I remember it was cold, but everybody was talking about it way back that it really gets cool after January. Speaker 1: Yeah, man. We had to go out February for a family thing and it was ... It's the wind, right? I mean, the temps were pretty cold, but that wind. They're from Casper. And so it just comes straight down and just cuts through you like, I mean, literally like a knife. Like I said, I've lived in Chicago where the wind is windy city, right? It gets pretty blustery there and it'll cut right through you. But boy, I tell you what, Wyoming in February. Now in June, I love it. It's absolutely gorgeous in June, but yeah, I'm not so much of a fan in February. Speaker 1: But anyway, I digress. I suppose we should get into what we were talking about today. But actually it works really well Tony to your point because you're talking about taking a vacation, spending time with family. I was just mentioning family. Speaker 1: And so what are you living for in retirement? Well, that's usually number one, spending more time with family. Now this could be in whatever set of plans that you may have, but that's usually what people have as number one on the list, and making those pennies work to get it done, those retirement monies to work to get that done, whether it's trips, whether it's events or whatever. Tony Mauro: Yes. I would say with our clients, the number one thing that people want to do. I mean, obviously when we talk with them, the first thing that sets all this up is, do I have an adequate retirement so I can do some of these things? But when we start asking, "Well, what do you want to do?" Number one is this, is spending time with family. Tony Mauro: A lot of times these days, not like when I was little at home. My family was in the same city. Kids move away and then you've got grandkids, and even brothers and sisters spread out throughout the country. They want to go spend time, the time they have left and enjoy the company. So it's important that, depending on what they think and how many times they want to go out and do that, is we have to work to ... And all these things we're going to talk about, to kind of section off parts of retirement that it's going to be used for those purposes. That way they don't have to worry about, "Well, if I do this, am I going to be okay? Can I still pay my bills? Can I still go out to eat once in a while?" Speaker 1: Right. Tony Mauro: So that's what I think is important, to be able to do that without having to skimp on everything else. And that goes for all of these, but. Speaker 1: Yeah. And of course family is going to be the top of the list for most people. And so we want to figure out a way to maximize our time, but also maximize the way we can do things efficiently so as to still have plenty in retirement for ourselves when we kind of start to wind down. Speaker 1: Now, maybe Tony, you were really frugal with your spending over the years, and you were just a really good saver. And so you get to retirement and you're like, "Yeah, I'm going to buy some stuff. I want to get some things that I really want." Maybe that you've had an eye on a classic car, or you wanted to rebuild one, or you've wanted to build some grandiose garden in the backyard, and you're going to need a tiller or a small tractor, whatever. You just want to buy some things. Tony Mauro: Yeah. And it's just like, and this ranks high up there. Although when we really start talking with them about the things they want, it seems like the older they get, the less they want stuff. They'd rather have experience and time, of course, but early on in retirement, yeah, a lot of people say, "I've done without for so long. I really want to do this or that." A lot of times it's a vehicle. Speaker 1: Yeah, sure. Tony Mauro: A lot of times it's something for the house or a new house or a second house- Speaker 1: Kitchen remod, or an RV or something. Yeah. Tony Mauro: Yeah. We just had a lady that she just came to us as a financial client, and she's very much into her house and she really wants to remodel it and have it nice. It's just her, but that's important to her. So one of our main questions is, was, can I take X amount out to do what I want to do and still be okay, depending on how long I live? So we calculated it all out and she has plenty of money to do that. And so that's what she's doing. So she could feel good about what she's doing and still know that I'm going to be okay in my life. Speaker 1: Right. Well, and I'm glad she's thinking about that, versus I imagine sometimes clients, and I'm sure this is frustrating as an advisor, but you're going to figure out a way to help them get through it, hopefully. But the client that calls up and says, "Hey Tony, guess what? We just did something." And I imagine you go, "Oh, no. What did you do?" Especially ... And again, not to say that you're on a budget and you can't make a move without getting your advisor's permission. That's not what I'm trying to go to at all. It's just that if you're talking about bigger ticket items, you may want to, like this lady did, you may want to say, "Hey, let's run some numbers real quick to make sure that if I go goofy on the house remod, that I'm still within my parameters for a good retirement." Tony Mauro: Yes. And I would definitely reiterate that. If you're going to do big ticket items, definitely check with somebody because what a lot of people forget is what is the tax consequence going to be on this. A lot of a hundred thousand to do a world trip or something, or buy a new house, especially if it's never been taxed before. Generally they don't have any penalties or anything, but you want to know that going in so you don't get hit with the big tax consequences that you might not have been expecting. Speaker 1: And the ramifications of that too. Not only the tax bill, but also maybe the tax bump right up to the next category, yeah. Tony Mauro: Yeah. Speaker 1: Yeah. I'll tell you what, if you're spending $100,000 on a world trip folks and you need some extra people to go, I will volunteer because that sounds like a good time. Tony Mauro: Yes. Well, that's the next topic. And I'll tell you, it's always near and dear to my heart. Speaker 1: The big travel plans. Yeah. Go for it. Tony Mauro: Is the travel plans. I mean, we have several clients who have wanted always to go on a worldwide trip. And when you talk about it, I mean, they're out for 200 days sometimes. And it bucks north of about 80,000 to 90,000 bucks. Speaker 1: Really? Tony Mauro: The highest one I've seen was 105. Speaker 1: Holy moly. Tony Mauro: Yeah. Speaker 1: That's amazing. Tony Mauro: But they really wanted to do it. And they had it all planned out. They've been wanting to do it all their lives and they were able financially to do it. And they had set money aside just for this, all throughout their retirement. So wasn't even ... It was like in a separate account, and they loved every minute of it. They knew that they could go and spend all that money, which some people might find offensive maybe, but that's what they wanted to do. Speaker 1: But you know what? They earned it. It's theirs. Do what you want with it. Tony Mauro: Yeah, it's their money. And they covered all the bases. So it wasn't like this was their last $100,000. So they felt very responsible about doing it and they wanted to do that. But a lot of people don't go that far, but they do. And me included. I'd love to be able to travel in retirement once a quarter or so, and hopefully knock off bucket list items before the physical health starts giving out. That's another concern of a lot of people, because not that many are that excited to go on halfway around the world for that matter at 80, 85 years old and just the body is [inaudible 00:09:16] Speaker 1: Well, talking about spending that much money, I kind of have ... It's the same feeling I had kind of have towards weddings. My wife and I were on the same page. I've never understood the concept of spending $40,000, $50,000, $60,000 on a wedding or whatever that people do, whether it's the parents chipping in, whether you've saved to do it yourself. But you know what? It's your money. It's whomever is deciding to do that. So who am I? It's not for me. I don't get it. So I would rather spend that money on maybe big travel plans. So to each their own, right? Speaker 1: So whatever it is that you're doing with your retirement money, and maybe that's one of the things you're doing. Maybe you're going to fund your child or your grandchild's massive wedding or a destination wedding or whatever. It all comes back to, Tony, are you discussing it with your advisor? Are you getting the planning steps in place so that they're aware a) I think that's a huge component. Please make sure you talk to your advisor so they can properly have you invested and structured in a way that you're planning for this. Tony Mauro: Yeah. I mean, you have to do that. And more and more people do want to help kids and grandkids as they get older. My dad has been that away a little bit. He's very much into now helping his grandkids and helping them out of college and whatnot. And that's very important to people, as they enter retirement. So as long as you check with your advisor and that's part of what you want to do, then, like you said, it's your money and you're the ultimate boss so to speak. You have your own money, your own destiny. So, as long as you've got some good advice, and in many times, a lot of things on this list, people like to do a lot of them. It's just ... Speaker 1: More than one. Tony Mauro: Yeah. Not quite as grand, but I want to do all of this stuff, but in moderation. So it's good after you retire to stay on a plan or besides just knowing that you have enough to live on is to how can I do what I want to do and still makes sense in my financial picture? Speaker 1: Well, the Xs in those are clearly important because that's how we're going to fund the things, but also having, what are you living for, what are you thinking about, what are you wanting to get to in retirement? And whether it's any of the things we listed or maybe even giving it away to charity or whatever the case might be, it all comes back to having a good structure laid out and working with someone who is going to be able to design those buckets that's going to be able to look at things from a tax efficient nature, because even if we want to spend ... Let's say, we're one of those folks that say, "I want to spend everything I got." Well, that's great. Do that. But why not do it as efficiently as possible so that you can maximize it? I mean, unless you just really want to give uncle Sam more than your fair share. Tony Mauro: Yeah, exactly. And the last topic really has to do with a little bit of a tax deductions and that's being charitable. And a lot of retirees want to, especially the ones that don't have anybody to leave it to, to give some money away. It makes them feel great while they're here. And then also getting a plan together for when they're gone as to what's going to happen to their money and where it goes. And they really feel good about being able to leave some. In a few cases, we've had all of it to charity. You commend them for that. Again, that's their choice. You stand back and say, "Well, gosh, I wouldn't do that," or whatnot, but you can say that about any of these. But that's their choice. And with the right planning, they can do it and still have a great lifestyle while they're here. Speaker 1: Oh, absolutely. Yeah. And it all comes back to just what you want to accomplish. And as you said earlier, some people may want to give it all to the kids. Although we're seeing more people starting to say, "You know what, instead of sitting on all this money and then passing away and leaving it to our family, what if we spend the money on them together with them? Like we do things." Speaker 1: And I think COVID maybe brought that back around to the forefront a bit. I think we were starting to head that direction societally anyway and saying, "Hey, experiences are probably going to be where it's at versus maybe the old way of thinking in the '70s, '80s and '90s of let me amass all this money and then just leave it to my family." Speaker 1: So I think people want to start doing more of that. Maybe that's a silver lining that we could take from being locked down and things of that nature, where we're now like, "Hey, let's get out and do some things together as a whole family." Maybe not just the husband and wife or the couple or whatever, but also, bring the kids or bring the grandkids or bring a nephew or a niece, or like the extended family, if you can, and things of that nature. So lots of ways to look at it, really just asking yourself, what kind of retirement are we living for or are we working for so that we can enjoy when we get there. Speaker 1: That's going to do it this week for the podcast. So as always, don't forget to subscribe to us on Apple, Google, Spotify, iHeart, Stitcher, whatever the case might be. If you've got any questions on how to structure your buckets or how to set things up or how to make sure that you're funding these things properly and you haven't started working with an advisor and you need some help, reach out to Tony. Find him online at yourplanningpros.com. That's yourplanningpros.com. He's got over 23 years of experience as an EA and a CFP serving folks here, well, really all around. So just reach out to him and get started. Speaker 1: You can subscribe to us on the podcast. You can find all that good stuff, a lot of good tools, tips, and resources at the website. And most importantly, if you need to take some action, do so today. It's typically no cost or obligation to do it, but you do have to let them know. Yourplanningpros.com. That's yourplanningpros.com. Speaker 1: Tony, I'm going to let you go. So I guess the next time I talk to you, I guess I'll see how your vacation went. Tony Mauro: Yeah. I'll give you some stories. Speaker 1: Sounds like a plan. We'll talk about Wyoming some more and I hope you have a great time. And folks, you stay safe and sane out there and enjoy the rest of your summer, and we'll see you here in August on Plan With the Tax Man. Disclaimer: Securities offered through Avantax Investment Services. Member FINRA, SIPC, Investment advisory services offered through Avantax Advisory Services. Insurance services offered through Avantax Insurance Agency.