Your Money, Your Wealth

Original publish date March 5, 2016 (hour 1). Note that content may be outdated as rules and regulations have changed. Episode 7 of YMYW is dedicated to retirement accounts and everyone who has one! Joe and Big Al share the biggest myths, misconceptions, and mistakes people make. Plus, new laws and proposals that could have a big impact on your retirement.

Original publish date February 27, 2016 (hour 2). Note that content may be outdated as rules and regulations have changed. In episode 6 of YMYW, Larry Swedroe joins the show to discuss what recency bias is and why you should avoid it. Joe and Al ask Larry what the key to successful investing is, and Larry talks about his books The Incredible Shrinking Alpha and Think, Act and Invest like Warren Buffett. 2:12 “The conventional wisdom goes like this: take distributions first from taxable accounts such as your brokerage accounts, then from tax-deferred accounts like your IRAs and 401(k)s…that is the rule of thumb for most advisory firms” 8:05 Interview with Larry Swedroe 9:14 “What investors tend to do, as we know, is they tend to buy after periods of strong performance which means they’re buying when prices are high and then they tend to sell after periods of poor performance, which means valuations are relatively low and expected returns are not high” 10:01 “Research shows, shockingly, that individual investors on average are such poor investors that they actually underperform the very mutual funds they actually invest” 13:21 “The key to successful investing is to understand what Napoleon advised about military strategies: He said battles are never won on the field, they’re won in the preparation stage” 15:26 “You have to just accept that markets are unpredictable and you must have discipline, you want to be a buyer when everyone is panic selling and you want to be a seller when everyone else is getting greedy. There is a simple although not easy way of doing that and it’s called rebalancing your portfolio” 16:14 “What people don’t understand is really how stocks are priced” 20:01 “People have this notion that if they can get in and out of certain asset classes or get in and out of certain markets, that’s going to enhance their overall investment experience, but actually the opposite is true” 21:04 “The key is to understand how markets have changed over the last 70 years” 23:59 “It’s not necessarily the mutual fund, it’s the allocation and how you’re actually positioning the overall accounts towards different areas of the markets” 24:55 “Here’s the key: what investors need to focus on is not trying to choose a money manager or stock that they think will outperform…what you do want to focus on is putting your money in the asset classes that you believe are appropriate for you to hold” 28:43 “Investing is really simple; you need to have a well-thought-out plan to make sure you don’t take more risk than you have the ability, willingness and need to take” 35:25 “When you have a fund that’s outside of a retirement account and the manager is buying and selling, that’s causing short-term gains which are the most expensive of gains. Now all of sudden you’re paying more in taxes”

Original publish date February 27, 2016 (hour 1). Note that content may be outdated as rules and regulations have changed. In episode 5 of YMYW, Joe and Big Al discuss the financial planning landscape and why they chose to start Pure Financial. Big Al breaks down a few of the presidential candidates' tax plans. Plus, why women are better savers and investors than men. 00:00 - Intro 02:23 “Everyone needs a financial plan. Everyone absolutely needs a financial strategy to make sure they know what they need to be doing” 04:33 “We don’t sell any products, there are no commissions generated to our firm” 08:17 “Our firm thinks it [the fiduciary rule] is a phenomenal thing, because we act as a fiduciary 100% of the time” 12:22 “We want to protect you against unscrupulous sales practices and things like that because we know the industry; we’re in the business and we see the good, bad, ugly all day every day” 13:50 “In the tax realm, there are a lot of strategies he [Obama] wants to get rid of…right now I think it’s important to realize what some of those strategies are so if they do apply to you, that you make sure you take advantage of them while they’re still here” 14:28 “You can still do Roth IRA contributions for 2015 all the way up until April 15th of this year (2016)” 22:03 “Ted Cruz wants to do a flat tax; he wants to do a 10% flat tax across the board…who is that going to impact? It’s going to impact the lower and middle class, while the wealthy will end up with a lot more money in their pockets” 27:10 “When you are married to a spouse who is making a lot of income, your self-employment income is pretty highly taxed, because you’re already in the highest bracket and you’ve got self-employment tax to boot” 31:24 “Vanguard shows that women are the ones signing up for 401(k) plans and saving a larger piece of their salaries compared with their male counterparts”

Original publish date February 20, 2016 (hour 2). Note that content may be outdated as rules and regulations have changed. In episode 4 of YMYW: are you doing your retirement all wrong?  Joe and Al discuss recent Social Security changes and which claiming strategies you shouldn't miss out on if you qualify (restricted application and file & suspend). Find out how you can make more informed decisions when incorporating Social Security into your overall financial strategies. The two finish off the hour explaining why working even one extra year can have a huge impact on your retirement. 1:59 “Money will have to last retirees a lot longer, so that’s longevity risk”  7:29 “More older adults are retiring with outstanding debt” 11:32 “If you’re 62 and older before the end of last year, you could still file a restricted application... Also, you have another deadline: April 30th: file for your benefits and then suspend them; these are the two things that are changing” 12:49 “The spousal benefit is half of the spouse’s benefit” 16:43 “No Social Security benefits are taxable in California—zero" 17:34 “Congress just got rid of a few Social Security claiming strategies this year, so the new rules make it more important than ever to make informed decisions when incorporating Social Security into your overall financial strategies” 18:44“Those final few years that you actually work make a big, big difference in the success or failure of retirement." 23:40 “A lot of you, when you really sit down and look at your situation, it’s a little bit tighter than you might want it to be" 34:55 “There’s a lot of new things with the new tax bill that can benefit you from a permanent basis”

Original publish date February 20, 2016 (hour 1). Note that content may be outdated as rules and regulations have changed. In episode 3 of YMYW, Joe tells us about the most significant financial strategies to start implementing now; Surprising things the government wants to tax you on; and the return of "Tax Chat" as Big Al shares a couple of tax tips. 02:40 “You can’t control the stock markets, you can’t control interest rates, you can’t control the price of oil...” 06:00 “You want to make sure you have enough capital in your overall portfolio to maintain that [retirement] lifestyle” 10:25 “We’ve been doing this radio show for over 10 years, we teach a lot of retirement courses at local universities and community colleges. If you go to our website we have a learning center with over 200 videos. What we try to do is make sure we empower people” 15:39 “Educate yourself to understand how much risk you’re taking in the portfolio” 17:10 “Taxes are something that you actually do have some control over, as long as you know how to manipulate and utilize the tax code to your advantage” 31:29 “A lot of you are in the sandwich generation, and what the sandwich generation means is that you have elderly parents that you are caring for and then you still might have kids on the payroll, so money is going every which way except your retirement” 31:50 “One of the biggest financial risks to retirement is your own grown children”

Original publish date February 14, 2016 (hour 2). Joe and Big Al discuss negative interest rates and how they could affect you. Plus, the President released this year's budget proposal! Big Al and Joe break it down and explain what the changes could mean for you and your beneficiaries.   4:24 “If you work an extra two years, it means that’s two years less that you’re taking from your portfolio and that’s two years more that you’re deferring your overall Social Security benefits” 10:22 “There are significant changes going on with Social Security; we are doing a webinar [on February 23rd, 2016] if you’d like to sit in the comfort of your own home and listen for an hour” 11:43 “For a long time economists believed that nominal interest rates or the amount of money received for depositing money was theoretically bound to zero” 12:05 “Lately, however, central banks from Europe to Japan have implemented a negative interest rate policy in order to stimulate economic growth” 19:18 “Here’s what they’re trying to eliminate: the backdoor Roth IRA, the stretch IRA, and step-up in cost basis at death” 19:55 "Here's how it [step-up in cost basis] works: when you pass away, your assets get stepped up to whatever they're worth at the date of death. Let's just say you bought a home for $100,000 and now it's worth $1 million and you pass away--you didn't sell it. When your kids get it and if they sell it for $1 million, do they have to pay gains on the $900,000 gain? The answer is no - it's a step-up in basis so it's as if your children bought that asset for $1 million. It works with stocks, real estate and anything outside of your retirement account, it gets that step-up in basis" 22:02 "Here's another change: adding RMDs at age 70 1/2 for Roth accounts" 24:08 “If it’s a large account, your non-spouse beneficiaries are going to pay a ton of tax in those accounts if you have a large balance in those accounts” 26:47 “You want to convert while assets are down because if you convert now, the recovery with the future growth in the IRA is all tax-free” 28:22 “What you need to do right now is have a forward-looking tax strategy created so you can figure out what steps you need to do this year, next year and the future so you can stay out of higher tax brackets coming” 30:02 "If you have more than $3.4 million in a retirement account, you will no longer be able to contribute to retirement accounts. You can still save money but it won't be sheltered from tax" 31:25 “Capital gains is a lot lower rate than ordinary income rate, in fact capital gains for most people is 15%, but ordinary income tax rates go as high as 39.6% so it can be a huge tax savings”

Original publish date February 14, 2016 (hour 1). Welcome to the Your Money, Your Wealth® podcast: retirement planning, investing, and tax reduction made fun. Hosts Joe Anderson, CFP®, and Alan "Big Al" Clopine, CPA of Pure Financial Advisors have been providing financial education on the Your Money, Your Wealth® radio show in Southern California since 2008, and on the Your Money, Your Wealth® television show in San Diego since 2014! In this, the first episode of the YMYW podcast, Big Al tries to stump Joe with the financial literacy test that Forbes says 80% of participants failed. 3:08 “Just because the balance of your overall portfolio goes down, that doesn’t necessarily mean you lost money – that’s volatility; that is normal in any type of market cycle” 7:03 “Another thing you should be doing is tax loss harvesting, so you want to harvest some of the losses if you have down positions. Sell those and buy something similar to take those losses on your tax return” 8:05 “An article out of Forbes Magazine reveals that 81% of Americans failed a basic financial literacy test” 8:44 “Planning for your retirement can be scary, but when you think you know what you’re doing and you really don’t, the final outcome could be really scary” 12:22 “What’s interesting about this is a lot of folks who took the test were very confident in their abilities to retire successfully (yet 80% failed the test)” 20:59 “Which of the following types of long-term bonds typically have the highest yield? Triple A-rate corporate bonds, B-rated corporate bonds or treasury bonds?” 24:56 “Anything that comes out of a retirement account that you took a deduction for is going to be paid full ordinary income tax and the state of California tax” 26:11 “As a CPA I would honestly say, it’s been 30 years+ in the business and it does amaze me how many people fail to get the message about tax planning until they make a mistake that costs them thousands of dollars” 32:10 “There is an age limitation on IRAs, so after 70 ½ you can no longer contribute to an IRA, however if you’re over 70 ½ you can still contribute to your employer-sponsored plan” 34:06 “When do you want to do your Roth conversions? When the market is down!”