Why is it important for advisors to never lose sight of who they're actually working for?

Well, I think because every financial decision affects someone's life, right? We are very, very important, right? Behind an account balance is a person who worked for that money and has plans for it.

Our conversation is to stay connected to what matters to that person and their family.

And I think that's, I'm very passionate about this because we see a lot of people come in and out of our office daily.

And there's a lot of people who have current advisors and they're afraid to ask for money.

They're afraid to call and ask about, hey, should I get into this IPO or whatever it is? And I think a lot of times these advisors feel like if they gather up individuals assets, well, now that that client's got to work for them.

And I tell people that it's like, hey, people or the advisor does lose touch with that because you're paying them some sort of fee.

into let's run into

[laughs]

But, um, you know, the, the tax for capital gains is something that's always been kind of on the table as far as adjusting or changing as well.

Um, but you know, the, the tax only applies to the gains, not the entire selling price.

And, you know, if you're in a home for that amount of time, you've probably made some qualifying improvements that could potentially increase your cost basis there too.

So, you know, if you've got the 250,000 exclusion for the individual, if you're married, the 500,000, um, and there's, there's a lot to do with that.

And we hear a lot of times from people that they wanna downsize.

Um, the issue in the world that we find ourselves in today is that, yeah, we could, um, downsize, you know, for, you know, little or I guess less maintenance costs potentially, um, maybe, uh, not navigating stairs so well, and we wanna go to a one-level ranch or rancher.

Mm-hmm

Sure.

So is that $3,000? Is that gonna be $10,000? Do you have no idea and your c- your, um, your spending's completely out of control? 'Cause we've seen people like that as well.

Um, so you know, you got to determine what it's gonna cost you every month to keep your lights on, right, to buy the groceries, pay, uh, health insurance, maintain the house, cover the things that you absolutely have to pay for, and that should be your starting point.

Uh, but do you know what that looks like? And that's where, you know, people have to get serious and really kind of dive into those numbers.

And let's face it, in today's world, it's so easy to track things.

Um, all you got to do is open up your phone, get to your credit card app.

It'll track your spending for you.

Why do so many people feel like they're starting from scratch every time they think about retirement planning?

Hmm.

So, you know, and w- there's always the caveat of past performance isn't always, you know, predicting the future.

But maybe someone says that they need 1.4 million to retire, or you'll need exactly 80% of your previous income.

Those numbers might be useful as a starting point, but they don't tell you anything about your lifestyle, um, taxes, Social Security, pension, debts, or goals.

So once again, when people get too fixated on a, a specific number, and look, we've seen how many studies in the past say, "We need a million.

We need two million.

We need five million." You know, you can take out 8%.

As we wrap up, though, I'm going to leave you with the final word.

But how do you guys help clients account for those lifestyle expenses so that they can enjoy retirement without necessarily worrying about overspending?

Well, Chris, I feel like that was a little dig at me when you were talking about the emotional turmoil that it can cause.

It's a dig at a lot of people, honestly.

I honestly don't want to talk about the NFL anymore right now, not until next year.

I don't think we've ever seen this disparity that we've seen in the Washington Commanders.

year.

But anyway, moving on, let's talk about some fun things.

What is a do-it-yourself retirement plan? When does a do-it-yourself retirement plan become more work than people actually expect?

What separates an advisor who is simply charging a fee from one who is actually providing value for what you're paying?

Well, I agree.

I think it's a very fair question.

It's a question that we field quite a bit.

I mean, it used to be that the first conversation we had, the first question that we would field from a prospect or client or what have you is, what's it going to cost me? Well, we've got to get through building that retirement roadmap to kind of see what things look like.

But I think it's a fair question because nobody should pay a fee without understanding what they're receiving for it.

And I don't care who you are.

are like 10 pieces with my son, sure.

So is there a way, is there an income strategy that can work regardless of how long one spouse or both spouses live?

Well, longevity might be one of the hardest variables in retirement because none of us know what our expiration date is.

So we can estimate different returns on investments or inflation or spending, but nobody knows whether they're going to live to 60, 65, 78, 88, 98, whatever.

I mean, those are all things that you got to pay attention to.

We were working with a gentleman one time, and the first time I met him, he walked into the door and said, you know what? We're planning this for 10 years because I won't be here in 10 years.

Now, he was 60.

It's not like he was 95, right? And I asked, and of course, I could visibly see that he probably wasn't in the best of health.

But for people who've done a good job saving for retirement, is this the kind of tax surprise they could still face?