Plan With The Tax Man

Tony Mauro
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Financial, tax and retirement planning guidance from Tony Mauro. Tony is the original Tax Doctor, serving central Iowa. We’ll teach you how to properly plan for retirement, minimize your tax burden and attain a successful financial future.

  1. Oct 21

    Don't Wait Until April: Tax Moves Worth Making This Fall

    Most people don't think about taxes until they're sitting down to file, and by then, most of the best opportunities are gone. The moves that actually lower your tax bill usually have to happen before December 31. Here's what's worth tackling now.   Important Links: Website: http://www.yourplanningpros.com Call: 844-707-7381   ----more---- TRANSCRIPT:  Speaker 1: Most people don't think about taxes until they're sitting down to file, and by then, most of the best opportunities are gone. The moves that actually lower your tax bill usually have to happen before December 31st, maybe even considerably before December 31st. So we're going to talk about that this week here on Plan with the Tax Man. Hey everybody, welcome to the podcast. Thanks for hanging out with Tony Mauro and myself as we talk investing finance and retirement. Tony, a CPA and a CFP, an EA of 30 plus years at Tax Doctor Inc. is certainly going to get geeked up to talk about taxes because I don't have anybody that loves taxes except for a CPA, but then it gets like a love-hate relationship.   But we're going to talk about how to reduce or what to do to think about next year's tax conversation. We've all heard it, many of us do it, a lot of us still don't. Tax planning versus tax prep, waiting until that last, "Oh, it's mid-March, I'm going to get ready for tax season." No, as you get closer to retirement, we should be thinking about stuff sooner. And as I mentioned in the opener, Tony, please don't wait until December 25th or 27th or 30th. That's not going to be helpful either. So we'll get into it. How you doing?   Tony Mauro: It is the midst of tax season or tax planning season-   Speaker 1: That's right. I was going to say-   Tony Mauro: ... in October.   Speaker 1: ... don't jinx yourself.   Tony Mauro: Yeah. Yeah. Well, for us, as we record this, it's tax season for us because we're working on extensions which are due here coming up.   Speaker 1: Oh, okay.   Tony Mauro: So we have a little bit of prep because there are some procrastinators out there just on the prep side. But for most others, now is the time to be thinking and working with your advisor and/or tax pro on any types of moves you can make to reduce next year's bill. Because like Mark said in the beginning, when you're sitting down or dropping off your stuff, that is not the time to tax plan because there's not much left, number one. Number two, most tax pros are in the filing mode and including us, are not going to have time to sit down with you and discuss your tax plan. That has to be done outside of tax season and proactively. I always reiterate that to our clients. And for us, we have gone even more away from it is if you want tax planning, we'll certainly do it. We schedule it. They do pay an extra fee or an investment for that, but they know what they get and they get a written plan every year. But we're going to go over some of this that we discuss when we're talking to clients.   Speaker 1: Okay. Well, let's go through a few options that people may know about or may not be using or just want to learn more. Number one being consider opening a donor advised fund. What is it and what are some things that it could do for you?   Tony Mauro: Yeah. So donor advised funds really are somewhat of, and a lot of people get the terms confused, but really it's almost like a flexible, if you will, charitable savings account. You can deduct now and give money to them over time. You can basically help direct where the money ends up going and they take the advisory role and they take all these funds from all kinds of people and manage the funds themselves and allow you to just much more flexibility in giving, especially if you decide you want to give something and you're going to give over time, but you can deduct a lot of it right now, which is great.   Speaker 1: Okay. So that's donor advised funds and that may be something, again, and with any of this stuff, make sure you're talking with your tax person, your professional, your financial advisor, all that stuff before you just jump into any of these things. But if you want to learn more, Tony and the team are here to help. The other thing might be, well, if you're self-employed, I know you got a lot of clients, Tony and potential people that come in the door all the time, have their own businesses, maybe they need advice or to learn more or to look at like a SEP for their... Even gig work, I guess you maybe could use one of these, side work too.   Tony Mauro: You could use it for anything that you are having to put down self-employment income on that tax return for. It could be, like you mentioned, a SEP, it could be a simple, could be a solo 401k, all of which they vary a little bit by the amounts you can put in them and a few rules, but any of them would work, especially so it knocks off two birds with one stone in my mind. One, it's forcing you to save for retirement, which is great on the financial planning end. Two, you might be able to, well, you will if you choose one of these, be able to take some tax deductions based on how much you put in, which is a great tax planning tool to try to reduce income.   And on a lot of these, since you're self-employed, you don't have to make the decision until you're actually getting a little closer to doing your tax return. So you got a ton of flexibility in them and it's where we start with every self-employed is it's the best deal on the street. You need to set up some sort of retirement plan for yourself, even if you only put 50 bucks a month away. Got to get it started.   Speaker 1: Yeah, got to get it started. Certainly something to think about there. Let's see what else. End of the year were winding down. Check your tax withholdings. If you're still a pre-retiree and you're still working, you probably had some maybe change. Maybe you're at that stage in life where you could put a little bit more away, catch up contributions, ages change, kids off the payroll, you got a little bit more room, big refund. I mean, who knows something, but check those numbers as well.   Tony Mauro: Got to check them all the time. I find a lot of people, even though they have electronic access to their payroll portal, which houses all their pay stubs and everything else, they're not going in and checking that. And I've had, I can't tell you how many people mess up their withholdings and not even notice it until year-end and all of a sudden they're either getting a huge refund or they owe a lot. And both in my mind are signals. And if you understand why this is happening, that's great. If you don't, then you need to fix it. Most people like to err on the side, of course, not having to pay the IRS at tax time, but sometimes, and in my mind and my true opinion is I don't like to let them hold my money. So I don't like big refunds, but I want to make sure that I don't owe a lot at the end either. And that comes with a little bit of planning.   Speaker 1: Yeah, you got to do a little bit. I mean, that's all of it. It's always the strategy. It's always like, well, yeah, you say planning all the time. It's like, well, yeah, because planning's important. You just don't wing it. You don't get in the airplane and just hope the pilots... You hope he's got a plan. You hope he's not just like, "Eh, let's see what happens." If you've got an HSA, plan ahead for next year. HSAs can be a really cool item for people. It's not for everybody, but if you've got one, certainly some things to think about.   Tony Mauro: Definitely some things to think about. It's a great tax planning tool and you want to make sure that you're stuffing as much money in, assuming you like them and can qualify with the right type of healthcare, which is basically you have to have a high deductible plan, but we won't get into all that. But it really is a lot of tax advantages because you can deduct it off of your wages and when you pull money out to use them for healthcare, it's tax-free, which is great. The beauty is you can stuff a lot of money in there and later on you now can roll these into if you have a big balance and you don't need it anymore, you can roll these into some rollover IRAs and use it for retirement. So it really is a great tool and it should be looked at and at least discussed with your advisor.   Speaker 1: Yeah, yeah, for sure. And it's that triple, it's that Roth on steroids. It's got all those little cool advantages that certainly could be helpful, but again, see if it's the right fit for you or see if there's some ways that you can use that or better optimize that. Also, next one here, Tony, don't forget that if you did turn the ever moving target age for RMDs, again, please do not wait until December to do this because think about it. I mean, December, even though it might be the 31st for a deadline, does anything happen the last 10, 12 days of December? Probably not.   Tony Mauro: Yeah, probably not. A lot of advisors, a lot of fund company employees, everything is pretty slow, tough to get things in action, and I wouldn't risk it. I would just do this before, you don't have to stress out about that. But the RMDs, there aren't a lot of moving targets anymore, and I even have trouble keeping track of them depending on when people were born and things. But the bottom line is the IRS, you will have an IOU to them that says, "Hey, we're going to make you take out a required minimum of this stuff that you put away for all these years because we want our money. We want taxes."   And so they do institute a big penalty on this too, if you miss them. I've only had a couple of clients actually be subject to the penalty. We have been able to get them out of it because it was just a simple error, but you don't want all that hassle. You want to talk with your advisor about, "Do I have them coming up? How much do I need to take out? What's it going to

  2. Oct 8

    Five Financial Frights That Keep Retirees Up at Night

    It's spooky season. And while most people are thinking about haunted houses and horror movies, a lot of pre-retirees have scarier things on their minds: running out of money, or a market crash at exactly the wrong time. Today we're shining a flashlight on five of the biggest financial frights and how to prepare for them.   Important Links: Website: http://www.yourplanningpros.com Call: 844-707-7381   ----more---- TRANSCRIPT:  Marc Killian: It's spooky season, and while most people are thinking about haunted houses or horror movies and candy, a lot of pre-retirees have scarier things on their mind like running out of money or a market downturn at exactly the wrong time. So today we're going to shine a light on five of the biggest financial frights and how to prepare for them. Hey everybody, welcome to the podcast. Thanks for hanging out with Tony and I here on Plan With The Tax Man. He's the tax man, Tony Mauro at Des Moines Professional Alternative Tax Doctor. And of course he helps clients all over the country as well. So if you're checking out this podcast, you got some questions, need some help, reach out to a qualified professional like Tony and his team at yourplanningpros.com. That's yourplanningpros.com. He's been doing this 30 plus years. He's a CPA, CFP and an EA. Got all the acronyms going on there, Tony. How you doing buddy?   Tony Mauro: Yeah. I'm doing good. Rolling into October, one of my favorite times of year. I like Halloween.   Marc Killian: Me too. Yeah, Halloween's... We were going to either do things that go bump in the retirement plan or five financial frights, some sort of little funny little tie into the spooky season, but we decided to go with the five financial frights. And these are pretty standard things, Tony, but certainly something that, again, the point being if it happens at the wrong time, it's never fun. It's never good obviously in many of these, but certainly at the wrong time, like AKA right at retirement's doorstep or maybe even in the first couple of years of retirement. So let's break them down. Let's get into them.   Tony Mauro: Okay.   Marc Killian: All right. Number one, pretty easy to figure this one out. Fright number one, running out of money. Take it away.   Tony Mauro: Well, this is probably our number one thing that we talk about to everybody really, whether they're financial planning clients, tax clients or whatnot, especially this time of year. And we work a lot with our accounting clients. I'm always asking them, "What is your end goal", number one? "And are you going to be able to pay your bills when you're in retirement and live the life you want to live? And really what it starts out with is how much do you have right now? How much will you have when you want to retire? What are your monthly expenses roughly? And is that going to cover it?" And that's where, to me, a financial planner really is one area of great value because that's what you want to be working with them on, not just, "Hey, am I getting the best return that I can?" It's this. It's the number one thing that you're saving for. So I think it's the most important and I think you need to be talking to your advisor about it.   Marc Killian: Yeah. And you start getting into the questions that you want to certainly digest, especially, Tony, right now while we've got a lot of friction going on and that really kind of will walk into the next couple of ones here in a second, but it's like how much can you safely spend each year? What are the expenses? And are you tweaking that year to year? Are you making little adjustments? A lot of times people, especially the last number of years have been doing the DIY thing and they've got a general plan and they're like, "Cool, I'm groovy. I've said it. I'm good to rock." And it's like, "Well, no, there's a lot of changes out there." So we want to be addressing those like for example, fright number two, a market downturn right before we retire. Look, we keep hearing it's going to drop any day now.   It still doesn't, but it doesn't mean that the risk is any less there because historical data is historical data. Now, ever since COVID, Tony, let's be honest, between pumping all the money in, the inflation problems it's created, the bond reversals that's happened, but yet the market continues to plug along. We've got this conflict after coming off the Ukraine thing, which is still going on. There's a lot of data that says the market should not be cruising yet it is. And that makes people think it's got to fall at some point, right?   Tony Mauro: Yeah. And this is an important thing, I think in anybody's portfolio. Everybody always asks us that too, "What do you think the market's going to do?" And we always tell them the same thing is, "If we knew that, we would already be retired."   Marc Killian: I was going to say, if you knew that, you wouldn't be helping others, you'd be sitting on your own island somewhere, right?   Tony Mauro: Yeah. But I think it's important. This goes along the lines of whether a DIY or you're working with somebody is the old theory is you want to start at least preparing your portfolio to get a little more conservative as you get a little older and as you get a little nearer to retirement. So if we do have the unpredicted or predicted market reversal or a period of long term, basically zero to little gains, that you aren't going to be hit too badly with your portfolio decrease in value, let's say. And I mean, that's the biggest thing because none of us have the crystal ball.   You're just trying to hedge your bets a little bit when you get up there into your mid to late 50s because you're still in the accumulation stage, not in the distribution stage yet, but you want to, at least if you continue to invest very aggressively, let's say that you understand what could happen and that's a risk you accept. And for most, at least the people I talk to want to get a little more conservative. Therefore, a lot of times people I'm talking to in their 50s, they want a return, but they're no longer asking the question, "Well, where can I get the best return?" They want to throttle it back a bit and say, "Hey, look, I want a decent return better than I can get in a savings account, but I am not willing to put up that much risk when I've only got five, seven years left to return."   Marc Killian: Well, that's a healthy place to be because it's hard because again, a lot of us see it continuing to rock and we're like, "I want to get on some of that." And we all do it. So if you can put yourself in that position where you're able to say that, you're certainly in a good, healthy place. I mean, year to date, Tony, right? So year to date at the time we're talking, the market's up 13 and a half percent. Given all the stuff that's happened, we're here in a fourth quarter and it's still up 13 and a half percent. So it could finish out the year again strongly as prior years have done.   So it's tough. It's tough to kind of... It's not the 20% of the last couple of years. It could be, we don't know, right before the year ends out. But either way, if five or six drives your plan plenty, fine when you're close to retirement on being in the market, getting a return, things of that nature, keeping up with inflation. If 5, 6, 7, 8% drives the plan, but it reduces the risk in case something does go south, then that's not a bad thing to think about.   Tony Mauro: It's not a bad thing. And that's where your advisor should be helping you and we remind our clients as well because we have a plan with them because it is, like you say, people will come in at their quarterly meetings and say, "Gosh, the market's doing so well. Maybe we should..."   Marc Killian: Maybe we think a little more.   Tony Mauro: Yeah. And I have to remind them, "Well, that's really not our plan. If we want to change the plan, that's fine. But we have to weigh that with the risk and potential tax efficiency and things like that." So again, just another great talking point to be talking to your advisor about.   Marc Killian: And that's a huge value add working with professionals because again, you do have somebody across the table and I love how you just said that. You're like, "Well, that's not the plan and it's probably not the best idea, but if you want to talk about doing the other thing, we can." You're not the money police, but it is your job to say, "Okay, here's pros and cons of what happens if we do A, here's what happens if we do B," that kind of thing. So I think that's a great, healthy way of looking at it too. So good stuff. All right. Fright number three, certainly a big fright. Rising healthcare costs, not going anywhere, ridiculous. I think I just saw some knuckleheads arguing here recently about how long it takes to get in to see a doctor here in the U.S. right now versus other places.   And it's still really short to get into a doctor versus other places, yet the cost is really crazy. So I get these arguments, but it is what it is. And especially if you're getting right at that retirement doorstep, Tony, maybe the employer coverage is going away, make sure that you're planning for that, right?   Tony Mauro: Got to plan for that. I think with most people that being W-2'd most or all of their working careers, they have just been in a healthcare kind of mindset of set it and forget it. "I pay my premium out of my check, my employer picks up some, I know my coverages. I don't really have to navigate much other than going to the doctor," and that kind of thing. But when you get to retirement, there's all kinds of new things to navigate because when you leave that employer, now you've got to deal with, of course, Medicare.   We're talking big government now and there's premiums there, there is deductibles, there are different out-of-pocket costs along with you need a lot of supplements and a lot of w

  3. Sep 17

    The Honor and the Headache of Being an Executor

    Being named the executor of someone's will can feel like an honor. It can also feel like a lot of pressure. It's more than handing out inheritances. It's paperwork, accounts, taxes, property, creditors, and sometimes family dynamics, stretched out over months or even years. A lot of clients end up in this role without ever planning to, and we're often the first call they make. Let's talk through how we help.   Important Links: Website: http://www.yourplanningpros.com Call: 844-707-7381   ----more---- TRANSCRIPT:    Speaker 1: Being named the executor of someone's will can feel like an honor, and it can also feel like a lot of pressure. It's more than just handing out inheritances. It's paperwork, accounts, taxes, property, creditors, and sometimes unpleasant family dynamics. So this week on Plan with the Tax Man, let's talk about the honor and the headache of being an executor.   Hey, everybody. Welcome to the podcast. Thanks for hanging out with Tony and myself here as we talk about investing, finance, and retirement. And Tony, as I teed up in the teaser there, it's some things that maybe you don't know about being an executor, some of the headache sides of things. It's a nice honor that someone, your parent typically maybe names one of the children, for example, to do this. But it does come with pressure and some things that can catch you off guard. So I thought it'd be good today to highlight some of this stuff.   Tony Mauro: I think it's a great topic, because it's relevant in my world because I have several clients going through it now, a couple of family members, and then one that is a friend of a client. They're both clients. One passed away and the friend is named executor, so he's in a whole new role dealing with family that is not his family.   Speaker 1: Okay.   Tony Mauro: It's a whole dynamic.   Speaker 1: Whole dynamic. I do want to note here, Tony, that this episode is not about giving legal advice, you are not an estate attorney, but rather the role that advisors that you and your team play, and questions that you often get or hear when a client has become an executor. So we're going at it from that standpoint.   Tony Mauro: Yeah. I think that that's good, because we work closely with the estate attorneys, and they're the ones directing the legal side. We try to help out the executor, as we'll go through here-   Speaker 1: Sure.   Tony Mauro: ... on everything else.   Speaker 1: Yeah, yeah. I just want to make sure we clarified that for folks listening.   Tony Mauro: Yeah.   Speaker 1: When a client finds out they have been named executor, Tony, what does that first conversation with them sound like from your end, or what are some bullet points here that folks might want to think about or need to know?   Tony Mauro: Well, some of the things that we tell them right up front is, I ask them point-blank, "How much do you know, if anything, about being an executor?" Most don't know anything because most are surprised that they are, even sometimes kids. And so they really don't have any idea what's involved with it, even if it's a very simple, straightforward estate. It could go anything from very simple, all the way up to very complex. But I try to tell them, "This is going to be a time period. It's not going to happen in 30 days. Depending on how complex it is, it could be months to several years. There's going to be documents needed. There's probate. There's taxes." I try to lay all that out on a timeline so that I can get them thinking... "Don't get yourself overwhelmed. We'll help you. The estate attorneys will help you. You've just got to take one step at a time. Sometimes you hit roadblocks and you've got to move on." So that's the first thing we tell them.   The other thing is if they've already got an estate tax attorney working on it, which they usually do.   Speaker 1: Right.   Tony Mauro: If not, we'll refer them. But we try to point out to them things... Because they get confused on what passes by will and what passes by what I call contract or outside of the will, in other words, goes directly to beneficiaries, and try to just have a conversation with them about that. That at least gets them going.   Speaker 1: Okay. Yeah. And I imagine that a lot of times, Tony, as you've already alluded to with some different clients going through it, if a client's parent, which is usually the case, or family member has told them that they will be the executor someday, how do you prepare them for that now? Obviously, being told ahead of time does give you a little time to prepare, I would assume.   Tony Mauro: Yes. It gives you some time. And really, we try to have the conversations about mostly of, okay, trying to get your parents or whoever you're the executor for to give you access, or at least let you know where documents are, what kind of accounts they have, what kind of assets they have, who the professionals they're working with right now are, just in case. If you can get that while they're still alive, along with helping the executor with some of the things that I just talked about, which they probably don't know, and just being ready to raise your hand and say, "Okay. I don't know this. Who do I ask when the time comes?" I think that basically is what we try to tell them.   We'll always try to be there for them. I tell them that. I tell them, "Let the attorneys do their thing. I'm not an attorney. But we will help you and we will work with them with you." They're usually more than willing to help, because they tend to not like anything tax and anything outside of really what they're good at.   Speaker 1: Yeah.   Tony Mauro: They being the attorneys.   Speaker 1: Yeah. And helping a client think through those pieces, again, they're coming to you for financial advice typically anyway, so now it's like, "Hey, I've got this extra wrinkle here. Is that something you can help me with?" That's just a nice little added value-add that comes with that component-   Tony Mauro: Yes.   Speaker 1: ... I guess, that legacy planning component, right?   Tony Mauro: Yeah.   Speaker 1: So once a client is actually now fully in that role, what do you guys do? You've touched on some of that already. But helping them get through it without, I guess, maybe that overwhelmed feeling, or even that rushed feeling if they found out maybe a bit late and it's like, "Hey, Tony, I just got named this. What do I do?" Right?   Tony Mauro: Yeah.   Speaker 1: "Where do I start?"   Tony Mauro: Yeah. Where do you start? We go through the timeline with them. We have some templates that we show them, and we'll start putting the timeline for their situation through the template so they've got it and they can follow it, which is kind of nice. Then we will start helping them start to gather the financial pieces that are going to help the attorneys as far as that goes. Plus, we might need it for a final income tax return and we might need it for an estate tax return, not the kind where you pay taxes.   But a lot of us executors don't know that when someone dies, the attorneys will open up a legal entity called the estate, and assets get transferred into that estate before they get distributed, and if they're in there long enough and they earn some money, if they're investments, they have to file a tax return. The estate's an entity. And so letting them know what's coming there, and then what the attorney's going to be needing from them, and really then just being a point of contact and working through the timeline and having regular check-ins, kind of like you do with a financial plan, of where are we at in the process on all this, and just monitoring it until the whole thing closes out.   Speaker 1: So Tony, you guys really do act as a steady point of contact then through this process. Is that fair?   Tony Mauro: Yeah. I mean, that's what we do. And like I say, with the timelines that we put in front of them, they have access to on their portal, and then some regular check-ins at different times. Obviously, I just had a call today with the guy I was talking about earlier, his story is a little bit unique, because him and the deceased were both clients of mine, both financial clients, both accounting clients and tax clients. The deceased was worth, and he was a young guy when he died here at the end of last year, about 15 million. And so my buddy, who was named the executor, he's working through a fairly complex estate. And on top of that, he's got some dynamics, because as the executor, the deceased left some very pointed instructions, "Don't maybe agree with what the family has in mind," so there's a lot of butting heads already going on.   And just a general statement, I've seen it so many times, it's amazing what happens when people die and siblings or relatives are squabbling about money. It's crazy. It tears families apart, which is why I would say, and I know every attorney would agree, you need to have a will in your financial plan, because you don't want to have... I mean, this guy had an ironclad will, so even though they don't agree with some things, that's what's in the will and that's the legal document, you know?   Speaker 1: Yeah.   Tony Mauro: But it sometimes puts the executor in a tough spot, because in this case, the executor is also charged with the deceased had two sisters that he's left some money to, but he wanted it in a trust, and they can only take out income, not the principal. And of course, they are fighting that, they don't want that, but they really can't do anything about it.   Speaker 1: Yeah. I was going to say, let's maybe clarify that too, right?   Tony Mauro: Yeah.   Speaker 1: So sometimes, I think when people get named executor, it doesn't mean you can just... You don't get to wholesale do what you want. You're not in charge of this whole

  4. Sep 3

    What Hot Air Balloons Can Teach Us About Financial Planning

    Every October, hundreds of hot air balloons rise over Albuquerque for the largest balloon festival in the world. No two pilots fly the exact same path, and none of them can control the wind. Turns out, that's not a bad way to think about a financial plan either.   Important Links: Website: http://www.yourplanningpros.com Call: 844-707-7381   ----more---- TRANSCRIPT:    Speaker 1: Every October, hundreds of hot air balloons rise above Albuquerque for the largest balloon festival in the world. No two pilots fly the exact same path and none of them can control the wind. Turns out that's not a bad way to think about your financial strategy either. Let's have some fun this week here on Plan with the Tax Man with you can't steer the wind, but you can steer your financial plan. Hey everybody, welcome into the podcast. This is Plan with the Tax Man with Tony Mauro and myself here to talk investing finance and retirement and going where the wind blows, so to speak. Tony is our conversation piece this week. How you doing, my friend?   Tony Mauro: I've been fantastic. Kind of wrapping up the summer. Just got done with the fair here. And of course, as we're recording this, kids are back at school.   Speaker 1: Okay. Okay.   Tony Mauro: Yeah.   Speaker 1: Hot as Haiti still at the time we're taping this, at least in my neck of the woods.   Tony Mauro: Me too. Very hot here.   Speaker 1: Yeah, it's a little toasty. I didn't know that little fun fact there that the Albuquerque International Balloon Fiesta draws hundreds of balloons and it's considered one of the most photographed events on earth. It's like a really big deal. I didn't realize that.   Tony Mauro: It is a big deal. Well, and I picked this topic because we have a big balloon fest here. It's actually in a small town just south of us about 12 miles. It's called Indianola Balloon Fest. It has about 100, 150 balloon pilots. They get a lot of people.   Speaker 1: Oh, wow. Okay.   Tony Mauro: And the other thing is that I really respect balloon pilots because I'm a GA pilot myself, not of balloons, of airplanes. But these guys and gals are way better than us because-   Speaker 1: Gotcha.   Tony Mauro: ... they don't have thrust. They can't turn. It's all about the wind. And so they're really good.   Speaker 1: That's awesome. That's very cool. Well, good. Well, this will fun. We'll talk about this, tie this to your other passion.   Tony Mauro: Yeah, that's right.   Speaker 1: ... the retirement thing. So speaking of the wind, even at different altitudes, it does not hold still. Been doing a little bit of research here. It can be calm at 500 feet and wicked and blowing completely different direction at 2000 feet. So it's impossible to control and accurately predict, certainly. Jet stream's going to do its thing. What are the things financially speaking we could tie into this that similarly we cannot control? I mean, obviously the big ticket is the market.   Tony Mauro: That's right. The big ticket's the market. And just like the balloon pilots especially, obviously they can't control the wind, but if you've ever been to a balloon fest, most of the time they can't take off unless it's really calm on the ground. But however, just like us pilots, as soon as they get up in the air, the wind is way different and they try to find what's best for them as we do too. But it's similar in the financial lives really because there's so many things that are out of our control, the market volatility being one, what's going on politically, interest rates, oil prices. I mean, you name it, tax law changes, all kinds of things. You bring it down into your own world and it's unexpected expenses. It might be an untimely health scare, which I have a friend that's having that right now.   All kinds of things. And so the timing of those really adds to that, which is something we have to plan for and talk with your advisors about and let them know what your plans are. And they're going to tell you the same thing. Some of the stuff you can't control, you've got to just change your plan to work within it.   Speaker 1: Well, and going to that point, since they can't fight it, they change altitude, right?   Tony Mauro: That's right.   Speaker 1: They go up or above, excuse me, up and above or below to find a current that's flowing and working for them better for what they're trying to accomplish. And clearly that's a nice little reasoning piece of logic to think about with our own finance. You're not abandoning what you're trying to do, you're just maybe trying to get some headwind.   Tony Mauro: Yeah, trying to just get a little direction on where you're going, just like they are. Because as I said, they can't steer. All they can do is the way they steer is find the way the wind's blowing. And if that's the way they want to go, that's where they got to get to. And it's no different than our financial plans because all of this stuff and this noise that's going on on the side, we've got to adjust our plan, keep it flexible, change it, monitor it. Hopefully you're doing with your advisor on that so that you're not just letting your emotions run wild with some of the stuff that's going on here and in the world.   Speaker 1: Yeah. Well, and I think that's obviously easy enough for us to do is let things run with us, which is why again, having a professional in your corner, a strategy and a plan kind of helps you recenter sometimes when you get a little blown off course. We'll stay with this analogy when you get blown off course. So Tony, from down on the ground, you can only see what's basically right in front of us, next street. I mean our sight line. Our sight line is reduced when we're on the ground. Anybody who's ever gone up any kind of height knows that. From altitude, everything looks a bit more connected. That's why we love looking at the horizon, how it just seems to fade off into forever. So why do we tend to ask money questions one at a time at that ground level, so to speak, instead of looking at it from that higher elevated path?   Tony Mauro: That's a good question because we get that a lot. We get a lot of people asking just these one questions at a time. I just had a meeting yesterday with a gentleman, he's a tax client. He had a few questions about his retirement, but I tried to get him to see the bigger picture because what he wanted to know was the quintessential question is, "Am I going to run out of money when I retire?" But most people want to know, they're in the accumulation stage, "Should I be doing more? Should I pay off this debt? How long should I work?" All those types of questions. But they tend to come at us one at a time because I think they only seem to think about what's right in front of them and urgent right then. And I try to get them to kind of look at the whole picture of, "Okay, that's one of the questions in all of this, we'll answer that, but let's look at how it fits into everything and your overall financial picture." Because I think that's the best way to go with it.   Speaker 1: Yeah. I mean, each question feels more urgent on its own, which is exactly why they maybe rarely get answers so well when we're looking at them from down at ground level. Every time there's a hiccup, it's dead in front of you. So it's the only thing you seem to be focused on versus... And this I think plays into taxation a lot, Tony, which obviously you're doing both pieces of this, you're doing the CPA side as well as the CFP side. This is where that higher elevation question really starts to pay off because you're not just looking at the immediate impact, you're looking at the future impact.   Tony Mauro: You are.   Speaker 1: Or we should be.   Tony Mauro: We should be. Yeah. But I tell a lot of people that I can't really answer this question by itself because it opens up so many other questions. Just like when you go to your regular doctor and you say you've got a sore throat, they're asking you all kinds of questions because they can't really prescribe anything or help you until they really know your entire situation. So it's no different than that in finances as well. I try to hold a meeting with somebody because somebody will send me a question through their portal to say it's a tax client and they think it's a 5-minute answer when really it's, well, there's a lot of what ifs. This is a 45-minute discussion. We better have a meeting.   Speaker 1: Yeah. That makes sense. That makes sense. Well, so Tony, thinking about this and kind of closing this down a bit here, the balloon pilot isn't just flying the balloon. Most of the times, now maybe in this particular event or whatever, but a lot of times you go on one of these rides, they're narrating, right? The flight for the passenger. Yeah. They're doing some cool stuff there. They're educating you on whatever. For those who don't, same kind of thing as like a pilot pilot. You don't know what you're looking at per se. They're pointing out interesting locations. They're teaching you how the thing works. All that stuff. And I mean, come on, that's like a perfect metaphor for what you do. It's not just that you're building the plan, you're also narrating things.   Tony Mauro: We're narrating things. The technical side is building the plan. And then the narrative really is one, explaining the plan in some terms that they can understand rather than just a lot of technical jargon because they don't need to master that technical side. That's what they're paying us to do.   Speaker 1: They need a navigator, if you will.   Tony Mauro: Yeah, they need a navigator. And a lot of times for us, just like the pilot, is you want to point out to them in their financial lives what's worth paying attention to and what's maybe not. In other words, I always tell them, "Rate of return is important, but not the most

  5. Aug 20

    Why People Keep Working In Their Retirement Years

    More people in their 60s and 70s are staying on the job than ever before, and it's not always about the money. Let's dig into the real reasons retirees keep showing up to work.   Important Links: Website: http://www.yourplanningpros.com Call: 844-707-7381   ----more---- TRANSCRIPT:    Speaker 1: More and more people are retiring in their 60s and 70s and staying on the job than ever before 'cause it's not always about the money. So this week on the podcast, let's dig into some of the reasons people keep showing up to work, even in retirement.   Hey, everybody. Welcome into the podcast. This is Plan With The Tax Man with Tony Mauro from Des Moines Professional Alternative Tax Doctor Inc. Serving you all around obviously the Des Moines area and the Iowa area, but all over the country. Tony's got clients, he helps all over the place. So if you got some questions, need some help, and you're checking out this podcast, and you'd like to get a little more info or just chat about some things, he's a CPA, and a CFP, and an EA with 30-plus years in the industry and a great resource for you to tap into at yourplanningpros.com. That is yourplanningpros.com. And Tony, how you doing my friend? You doing all right?   Tony Mauro: I'm doing good. Yeah. Summer is in full force here, and enjoying it as much as I can.   Speaker 1: Nice. Yeah. So you're obviously still plugging away. I'm still plugging away. Now we're not at that age yet. We're in our mid-50s, but I'm sure you're seeing this with a lot of your clients as well, people that are into retirement, they've maybe got their strategy or they're playing with you guys, but are still working. And it could be for reasons other than the money, but I want to talk about both sets of those today, right?   Tony Mauro: Yeah.   Speaker 1: So let's dive into the first one, and we'll just start with social connections, for example. So this is not money-related. This just might be simply, "I like the people I work with, and it gets me out of the house, and it gets me some human interaction," especially, unfortunately, if you are a retiree who maybe has lost your spouse. Maybe this is a great reason to keep moving, and going to work, and doing things.   Tony Mauro: And I see a lot of clients that want this because... And I fall into this category myself, I think, is when I go to retire, I want a little social, like you say, connectivity. And with a lot of people, what I find with them is because they've been working for so long, they miss that. And they come back and tell me six months to a year into retirement that, "There's only so much golf I can do. There's only so much putts at around the house that I can do."   Speaker 1: Did you really just say that?   Tony Mauro: Yeah. And I would agree with that to an extent, and a lot of them like to go back to work. Generally, they'll go back and get something that they're not really concerned as much, especially if they don't need the money, about what it pays, other than they don't want generally tons of responsibility, or being able to set their own hours, or work part-time. But a lot of them for the social connection, they really enjoy it. And so I'm always good with that if they're asking me what do I think. And I think it can contribute to a longer life, frankly, especially like you said, if a spouse is gone.   Speaker 1: Yeah, definitely. I think a lot of people certainly continue to want to work just for that social connection alone, and that's totally fine. And I think the takeaway here, Tony, is going to be work optional, right? There's-   Tony Mauro: Yeah.   Speaker 1: ... reasons why you go to work because in retirement, and it's because it's an option, because you're choosing to versus not, because you're not choosing to, or you have to go for the money reason. And I'm going to skip around on the list. We'll get to the money one here in just a minute, but I want to do another one from the home standpoint. And that's just changes in the home. So not that there's much of a silver lining to think about with COVID, but certainly during that time period, a lot of people got a dry run of what it would look like to get into retirement with their loved one being at home together 24/7. And so maybe that was a little bit of a wake-up call. And I know, Tony, I've got advisors all over the country I talk to, like yourself. And all of you guys and gals have stories where one spouse or the other looks at the advisor and says, "Get them out of the house. They're driving you nuts."   Tony Mauro: That's right. Yeah. "I want to kill them."   Speaker 1: Right?   Tony Mauro: Yeah.   Speaker 1: So that could be a big thing to think about too, "I want to keep that sanctity of the home, so one of us is going to keep going to work because it gives us the social connections, but it also gives us a relief from the spouse."   Tony Mauro: Yeah. And I think this one I will struggle with because for a lot of people, you've been going to work for so long that it's hard to change your routine.   Speaker 1: Indeed.   Tony Mauro: And then you find out that you've been going to work, your spouse been going to work for so long, and you see each other at night on the weekends. Yeah, that 24/7 thing drives a lot of spouses on both sides crazy. And I think it's something that you have to at least take into account, especially if you're young enough and don't need the money to get out and make that happen.   Speaker 1: Yeah. And I think routines change, right? There's just various different things that just cause that uneasiness. And again, maybe it's not work, maybe it's something else. Maybe it's book clubs, or volunteering, or whatever the case might be. But I think that could be a reason people just go, "Well, you know what? I'll just go back to work because it gives me some social time with other folks. It gets me away from the spouse for a little while so we're not at each other all the time. And I make a little extra money because it helps with some of the money woes." Right? And so-   Tony Mauro: Yeah.   Speaker 1: ... that'll walk us into the money woes conversation, Tony, because some studies have shown that nearly half of retirement age folks who are still working do so out of financial necessity or financial stress. And I think this is where you've got to have that strategy and plan in place, because if you absolutely have to work for the money, no shame, it is what it is. But if you're stressed about it when you don't need to be, that's kind of silly. Find out. Go to work because you want to, not 'cause you have to.   Tony Mauro: By far, yeah. This is the biggest conversation to have with your advisor. And we do it a lot with people before they retire on... What it comes down to is a couple things. You get to that 65, 67, and say you just haven't followed good advice, and you miss the mark, and it's a little late to save. You've got to go to work because you have to. And like I say, there's nothing wrong with that. You have to do it, depending on what kind of lifestyle you want. And that's one thing. But the other thing is a lot of people tend to just go to work because they... And they really don't have to. And again, if they want to just because they don't have to, that's great. But they continue working because they're worried about running out of money when, really, they do have a good plan, and they won't run out of money.   So make a decision based on that. I think that's where the advisor, beforehand, needs to talk to them. I just had a conversation with a client, he's only 43, making some good money, but he has not done much for retirement. He just refuses to do it. And I had the conversation with him, and I told him, "Look, I'm going to pull your social security statements for you and your wife's balance from her 401(k). I'm going to extrapolate that out. So if you continue down this path, here's where you're going to be at about 67." And he was floored because he says, "That's not the money I'm making now. I won't have any money." I said, "Exactly. So you've got money worries, so you've got to start now." Not too late for him, but you need to have these conversations, especially when you're, I think, in your 40s and 50s, with your advisor, 'cause that's the whole reason you're paying us, is to say, "Am I going to be okay at retirement or not?" And I can make these easy decisions, I think.   Speaker 1: Yeah. And I think this is where the final piece of this, Tony, is if you're doubting your strategy or your plan, or you don't even have one, clearly, then this is where you got to get one, 'cause even after years of working towards the goal of retirement... And a lot of people, Tony, when they come in for those initial consultations, they're in better shape than they realize, but they still think, "I'm going to have to work. I'm never going to be able to retire." So if you've got any doubt at all, this is why it's so important to just go get a strategy. Go out and talk with one, two, three different advisors, find the one that you like, have those consultations, those reviews, see who you resonate with, do your homework, check and see if they're properly licensed and all that good stuff, and get started, because that'll help you alleviate... Then the other things we talked about today come back into play just because you want to.   Tony Mauro: That's right. And most people, I think, want peace of mind when they get to that retirement... I know I do. My big peace of mind thing right now is, "Am I going to be able to go somewhere warm for all four months of the winter when I retire?" And I've done my calculations, and I think I'm going to be in really good shape for that. And so again, peace of mind, "Okay, I can do that." But if you're at all in doubt of your plan, or if you don't have a plan, now's the time to start working. It's never

  6. Aug 6

    The DIY Retirement Plan — Where It Works and Where It Gets Expensive

    There's an entire television network dedicated to doing things yourself — home renovation, landscaping, interior design, all of it. And the DIY mentality is genuinely admirable. But when it comes to retirement planning, the stakes of a bad install are a little higher than a crooked backsplash. Let's talk about what DIY planning actually looks like in practice.   Important Links: Website: http://www.yourplanningpros.com Call: 844-707-7381   ----more---- TRANSCRIPT:    Speaker 1: We've created an entire television network dedicated to doing things yourself. Everywhere you turn, it's DIY, this and that, home renovation, landscaping, interior design, all of it. And the DIY mentality is genuinely admirable. But when it comes to retirement planning, the stakes of a bad install are a little higher than just a messed up backsplash in your kitchen. So let's talk about that this week, the DIY movement in retirement planning and what that looks like actually in practice.   Hey everybody, welcome into the podcast. This is Plan With The Tax Man with Tony Mauro. And we're going DIY this week, Tony, little pitfalls of doing things yourself. Everybody does it to a certain degree in many walks of life. You and I both have done a lot of DIY things ourselves, but certainly when it comes to the financials, this is maybe room to pause and think about this.   Technology, Tony, has changed. It's super easy to do a lot more things. Absolutely. I'll agree with that. I'm sure you will too. But the complication of preservation and distribution, AKA retirement, is vastly different than accumulation. So let's talk about that this week a little bit.   How are you doing, my friend?   Tony Mauro: I'm doing good. [inaudible 00:01:36].   Speaker 1: Do you agree with my statement there?   Tony Mauro: I agree with your statement. Yeah. And I love this topic for a lot of reasons because I think as we... Well, in the world we live in, especially with the AI advancements and whatnot, it's just getting worse and worse. Everybody wants to do everything themselves. And I think a lot of times, and I'm one of them too-   Speaker 1: Sure.   Tony Mauro: ... I used to love doing home renovations because I enjoyed it. But now that I'm a little older and I try to preach this to my son and whoever will listen, is you need to outsource everything that you're not good at or you don't enjoy because that's going to free you up to do what you do enjoy and/or make money. And we do it at our business here. I mean, I don't touch the IT. I don't touch the phones. Now, could I, and try all that? Yeah, sure.   Speaker 1: Sure.   Tony Mauro: It clutters up my life too much. And I want to give it to the guys that are good at it. And so yeah, I agree with your statement wholeheartedly.   Speaker 1: And it's one of those things where we certainly know in this world it's been more and more difficult, especially post-COVID, to get people to show up and maybe do quality jobs in different aspects of things.   Tony Mauro: Sure. Yeah.   Speaker 1: And so everybody feels like, "I'm just going to take on this." What's the old saying? If you want it done, right, do it yourself?   Tony Mauro: Right. Do it yourself.   Speaker 1: And that could be true. But I mean, my brother and I are fairly handy and we built some things around my property, Tony, but when it came time for a complete overhaul of the back deck and building a roof on it and all this kind of other stuff, I just did not feel comfortable in our skillset, so I farmed it out. Did it cost me more? Yeah, probably. But then again, maybe not because how many times might I had to double back and fix something that I didn't do right the first time because I don't have the skillset or the longevity of doing these things.   So financially speaking, I think that same thing happens. There's so many tools out there now. And growing the money... I mean, Tony, check this out. So you might know this off the top of your head, but if you don't, don't look it up. Just give me a quick educated guess. At the time we're recording right now, how much do you think the S&P 500 is up the last five years?   Tony Mauro: Cumulative?   Speaker 1: Yeah. Cumulative. Give me an idea. What do you think? Five years.   Tony Mauro: Five years, I'm going to say 45%.   Speaker 1: Okay. How blown away are you that it's 75?   Tony Mauro: That doesn't blow me away.   Speaker 1: Okay.   Tony Mauro: I was thinking a little higher, but no, it doesn't blow me away.   Speaker 1: Okay. 75. Crazy, right?   Tony Mauro: Yeah.   Speaker 1: Five years cumulatively, the S&P 500 is up 75%. The Dow up 50 over that same period. So it's easy for people to go, "Oh man, you can be an idiot and throw a dart at something and do well." But when it comes time for the... As we get closer to financial or retirement, excuse me, distribution, there's a lot more at stake. And I think this is where people start to find themselves at a crossroads. And do you find that? Do you have people coming in that are like, "I've been doing it myself, Tony, but there's a lot I don't know and I'm getting a little nervous. I want to make sure I don't screw this up because this is my forever money"?   Tony Mauro: They do. And that's how a lot of people come to us. And if they've been doing things themselves, we certainly don't tear apart what they're doing, but we just try to ask a lot of questions and make sure that not only... Because a lot of people come in, "Well, I've been doing this myself and I've been averaging 10% a year or I've been beating the S&P 500."   Speaker 1: Sure.   Tony Mauro: And I say, "Well, okay. We really have you... Let's see, but that's good." And then the first question as I ask is, "What do you have for an emergency fund?" And they have a strange look on their face. And we start talking about that. I said, "Well, what about you... Tell me about your assets and things. And then we'll get to the part of, well, what do you have for life insurance?" And so some of that stuff they don't think about. All they're thinking about, "I throw my dart at the board. I'm investing in this. It's growing. I should be okay." And that may be the case, but there's more to a comprehensive, keyword, financial plan.   Speaker 1: And you may be doing well, right. So think about my analogy a second ago about what the numbers have done. So let's say you had a million bucks [inaudible 00:05:37] on the S&P 500, you're up half a million dollars over five years. And you're thinking, "Man, I got this thing figured out." Great. Okay. So now you got a 1.5 million sitting in this account, you're getting close to retirement and you got to start pulling this money out. And now you don't realize the things that you're triggering. So your income strategy is going to affect some other things. It's going to affect your Medicaid or your Medicare, excuse me. So you're going to get those issues. You got to start dealing with the IRMAA situation. That catches people off guard. The taxation of the whole thing, Tony, is what catches a lot of people off guard. That's where a lot of people are going, "Okay, this is why I definitely need help. How can I be more efficient here?" And with you being a CPA and a CFP, you're thinking about the tax situation, but as well as the future planning.   Tony Mauro: That's right. And some of those triggers you're talking about are exactly what I think a lot of people miss really with a good advisor. With us, we're looking always at, we know you want to get the most money, especially around retirement.   Speaker 1: Sure.   Tony Mauro: We got to do it tax efficiently because we don't want to give the feds any more than you have to. So let's think about it. And let's take everything into account, Social Security and everything else you might have coming in, to make sure that that's the case, that we're always on track with that. And don't miss that by too much because it's just ineffective. And at the end of the day, you bleed money and you don't even know it.   Speaker 1: Yeah. I mean, I can see somebody coming in DIY or they've done well. Let's just go with a million bucks, Tony, because it's easy. They've got a million dollars in their portfolio. And they come in and they're like, "Hey, I heard Ramsey talking about taking 8%. I've done the math. I'm going to pull 80 grand out a year, blah, blah, blah. I should be good to go, right?" You know what I mean? And it's like, that's a quick back of the napkin thing. It's like, "Well, all right, the 4% rule is half of that. The guy who created the 4% rules moved it to 4.7."   But for easy math, Tony, you could sit there and go, "Well, does 40,000, if we go with the 4% rule, does it get it done? Does it drive the plan?" Because Ramsey's thing is, "Well, if the market averages 10% year over year at minimum, why not take 8%?" But of course, the downside of that, Tony, is that to make that happen, you're 100% invested in the market. And I think again, as we age, we're not really comfortable taking that amount of risk.   Tony Mauro: No, no. And I think that's one of the flaws that a lot of DIYers end up with is they'll come in with some... We use that example.   Speaker 1: Rule of thumb. Yeah.   Tony Mauro: Just that rule of thumb, yeah. And when we sit down and start putting some numbers to that and their situation, most of the time... And I like Dave Ramsey's stuff about getting out of debt, staying out of debt, saving and whatnot. I don't agree with the 8% year-over-year. I think that's too aggressive based on things that happen not only in the market, because he's assuming it earns 10% every year. We know it does not, even though lately it's been way up. But what if you go through a stint right when you retire that it goes up 10% one year? And then we have a situation like from '04 th

  7. Jul 23

    The National Park Guide to Retirement Planning

    Whether you're visiting one of the 63 national parks this summer or just hitting a local trail, a lot of the best practices for a great hike apply just as well to your retirement plan. Let's “walk” through a few. Important Links: Website: http://www.yourplanningpros.com Call: 844-707-7381   ----more---- TRANSCRIPT:  Marc: This week on Plan with the Tax Man, maybe you're visiting one of our national parks this summer or just out hitting the local trail. And if you are, we have some best practices for a great hike that apply just as well to your retirement plan. So let's walk through a few of these with Tony Mauro. Hey everybody. Welcome into the podcast. This is Plan with the Tax Man, with my friend Tony Mauro. How you doing buddy? Tony Mauro: I'm doing good. Marc: Yeah? Tony Mauro: Midst of summer. Marc: Yeah. Tony Mauro: It's all good. Marc: I'm telling you what, it's been crazy, incredible hot. Look folks, little FYI out there. If your AC unit fails you during the really hot months, be very, very careful because apparently mold can build in the ducts quickly when the humidity is high and the AC's not working, go figure, even though the AC's not working because the water and condensation that sits in there while waiting to get it repaired apparently turns to mold. So a little FYI because it's expensive to fix it. Tony Mauro: Yeah. Marc: And that might be a retirement expense, Tony, that you just didn't see coming, right? Tony Mauro: You didn't see coming. You better have to depend on the emergency fund. Marc: Exactly. Right. So we're always trying to provide useful nuggets of information on this podcast. But we're going to have some fun this week. Tony, I know you like to travel. I know you like to go a lot of places. Do you visit the national parks? Do you do some of that stuff? Tony Mauro: The reason that I want to talk about this, because I was just out in a couple of them last week. Marc: Oh. Tony Mauro: I had to go out to South Dakota for a wedding, and so we stopped at the Badlands National Park. Marc: Nice. Tony Mauro: And it wasn't really a park, but Mount Rushmore. But I have been to other national parks out. I've been of course to Yellowstone and a couple of others. A lot of them I still want to see, and they're very interesting. I will say- Marc: You have been at Yellowstone or not? I though you had. Tony Mauro: I have been to Yellowstone. Marc: Oh okay. Tony Mauro: Yeah. Marc: Yeah. Okay. Tony Mauro: I still have a few on my list. Zion and Bryce And some of those, but I do like to hike. I'm an amateur. Marc: Yeah. I want to go to Denali. That'd be cool. Tony Mauro: Yeah, Denali. Marc: Yeah. Or McKinley, whatever it used to be called, either way. So look, do you know how many national parks we have, by the way? There's a lot. Tony Mauro: I don't. Marc: There's a lot. 63. Tony Mauro: Is that how many? 63 national parks. Marc: Yeah. 63 national parks. Some are really big, obviously, and some are really small. I think Hawaii's got a couple. I think California's got like six, but yeah. So there's different sizes and stuff out there. So anyway, a lot of people like to visit these things as a summer thing with the kids or grandkids maybe. So we'll talk a little bit about some analogies. I'll let you spin some financial wisdom to my setup for the park conversation. So we'll start with a map. Don't leave home without a map. I know we got these cell phones and that we're attached to them now, Tony, but you might not get signal in some of these bigger parks. And if you think about it, a lot of the gates when you go into some of these national parks, the first thing a ranger does is tell you a couple things and they hand you a map. Tony Mauro: That's what they did to me. Yeah. Marc: Exactly. And that's the same thing. It's to help keep you oriented. Same thing with a financial strategy. It's to help to keep you oriented and focused. Tony Mauro: It is. I mean, the financial plan, if you have a formal one, I mean, that's your backbone. That's the map itself. And just like when I was... We did a little hike in the Badlands on our own and they gave us a map to make sure we stayed on the trails and stayed on... I equate that to just like in the financial planning world, stay on track and make sure that you're following your map as best you can. So out there in the Badlands, if you get off the trails, a lot of bad things can happen quickly. Marc: Yeah. Tony Mauro: In the financial world, it's going to be a slow burn if you get off track, but over time you get off track too much, and what's going to happen is you get to the end and you are not going to be where you though you were going to be. Marc: Mm-hmm. Yeah. Tony Mauro: And so with this plan, as it changes and whatnot, it's not like a static map that you'd be holding in your hand with hiking. Marc: Sure. But if you get a little off course, it might help you get back on. Or even those reviews serves as almost like a check-in spot. Maybe you're going on a really long trail through the parks and it's like, "Hey, we're going to stop at this little whatever this thing is." And there's a map there because maybe they've made some changes or who knows? Tony Mauro: Yeah. In our annual reviews, I mean normally the plan changes a little bit every year, if nothing else, just with a little bit of goal modifications and things like that. And then of course, maybe even rebalancing. Marc: Well, life's going to throw something at you. Tony Mauro: Life's going to throw something at you. I was just telling you before this call, life threw something at one of our clients. They've got parents going into, one's got dementia and had got to go in a nursing home with no plan. And boom, all of a sudden life changes quickly. Marc: Yep. Tony Mauro: All the better to have a map and to be following it. Marc: For sure. For sure. Well, and unfortunately, Tony, one of the problems that we run into often when we go to these lovely, beautiful national parks because our country is full of amazing locations, is unfortunately there's other people. And people don't do the best job of always picking up after themselves. So when you go to just about every national park, there's signs everywhere. "Please do not leave your garbage. Please do not do the..." Like at Yellowstone, we were just talking about that. At the sulfur pools, "Don't throw cans in the sulfur pools," things like that. Just crazy stuff that you think, hello, common sense. We should not do this. Ultimately, the message is don't leave a mess behind. And financially, same kind of thing. I mean, when we're no longer here, are we leaving a mess for our family? Tony Mauro: Yeah. And that's what I was just on the call with is that this family's mother and father are going to leave them a mess, and they didn't plan for it. And you don't want to leave your loved ones when you're gone. I'm already talking. I'm working through it myself with my wife at our life list. Something happens to one of us, we don't want to leave a mess for our son. And that means knowing where everything's at and how to close things out and what's going to go where. It's hard enough for loved ones when you're gone dealing with all the emotions. You don't want to leave them with a financial mess. And that goes from everything from no will to outdated wills, no beneficiaries on certain things, keeping all your stuff secret. I think you need to be more transparent with your heirs to make sure that you don't leave them with this and let them know what the plans are. You don't have to share every detail of every cent that you have, but I think you should leave something for them to help them when the inevitable happens. And then you're not going to be blindsided. Marc: Yeah. Yeah. I mean, and sometimes there's a lot of little things too. Unfortunately, big situations like the one you're currently dealing with there, but there's the little things people can do to not leave a mess. I mean, even something as simple as your TODs or PODs on some of your different accounts. A lot of times people don't even think about that. They got a bank account, maybe they got 50, 60, 70 grand sitting there and they forgot to put transfer on death to their spouse or whatever. So just a mess. Just make it easy when we pass on, because we're all going to pass on. Try to make it as easy as possible and leave no mess behind. The scenic route. A lot of times we go to these national parks, we love to do the scenic route. Lots of things can get in the way. It's fun to do the scenic route, but sometimes you're just tired. You want to take the quickest route too. And I think when you're thinking about retirement, sometimes it's easy, Tony, to be like, oh man, what's the fastest way to get me some more income or take advantage of this crazy market run that we've been on or whatever. So the scenic route could be the way to go. Sometimes the faster way is the way to go. It just depends. Tony Mauro: It does depend. And it depends on going back to the first thing we talked about is your map and really what's going on. What we see mostly is clients wanting the fastest way. And you hit it on the head is what's the fastest way I can get to X amount because they think that's... And what they end up doing is, without a good plan, they could end up taking a lot of risk. They could end up really shooting themselves in the foot a little bit because there's all kinds of things out there. Anything from the volatility in the markets, what's going on in the world politically. And then of course dumbing it down a little bit, just not dumbing it down, but shrinking it down to what's going on in their personal lives. You're going to have things that pop up at you that scenic route may be the better route. Our jobs as advisors is trying to mesh the scenic route with the fastest route and get the best of both of the

  8. Jun 25

    Reacting to the Most Watched Retirement Video of the Year

    Over the past year, one retirement video on YouTube pulled in 3.7 million views. The title: "Sell These 5 Things Before You Retire." We thought it was worth a conversation — not to tear it apart, but to react honestly. Do we agree? How often do we actually see this play out with real clients? Let's get into it. Important Links: Website: http://www.yourplanningpros.com Call: 844-707-7381   ----more---- Transcript:  Marc: Over the past year, one retirement video on YouTube pulled in 3.7 million views, the title, Sell These Five Things Before You Retire. We thought we would talk about those five things this week here on the podcast and break it down a little bit with Tony here on Plan With the Tax Man.   Welcome into the podcast, folks. Thanks for hanging out with Tony Mauro and myself, as we talk investing finance and retirement. And yeah, the top video of 2025 for retirement was 3.7 million views, Tony, and it's Sell These Five Things Before You Retire. So, we'll keep that in mind as we're breaking these down. I want to get your take on each of these, and does it make sense to you? Do you see that often? Just let us in on your insights as a planner who's been doing this for many years. So, this should be fun. How you doing, my friend?   Tony Mauro: Yeah, I've been doing good, been doing good. This is a good topic because I think we as planners get asked these things a lot. This was a really good video. And I did view it, I agree with most of it.   Marc: Yeah, I do too, yeah.   Tony Mauro: We'll break it down a little bit and have some fun.   Marc: Yeah. Well, let's start with the biggie. The oversized house. I think this is a huge question for obviously many, many people. Obviously, it resonated with lots of folks because yeah, I mean, it could maybe free up some significant money. Now, however, depending on what you want to do, housing prices are still pretty high. So, but I do agree overall with this concept. If it's this big place that the two of you don't need anymore, well, that's something to consider.   Tony Mauro: It is, and all of these topics really I would preface with saying it begs the question to at least discuss with your planner, because they're selling... In the video they're saying, "Okay, yeah, do this, this, and this." I don't agree with it all the time, but at least you're asking the question. But the theory here is, is obviously if you've got a big house, only two of you in it, no mortgage, maybe don't want to take care of it anymore, have had it a long time. Could sell the house, take the tax-free gain most of the time, and then either downsize and possibly have more money in your pocket to do something else with.   Now, where I disagree with this a little bit is because housing is the way it is, it seems like a lot of times when people go to sell property, at least in the Midwest, down the coast, maybe if you can make a lot of money that's a different story. But they find out, well, I make two or 300,000 on it, and then I go to find something even though it's smaller and I got to invest all of my proceeds plus the gain because things are up from when I bought, and they don't really get as far as they thought they would. But the theory is good because if you're, like in my own case, I have a fairly large yard and I talk with my wife right now. I was like, "As we age, do we really want to take care of this?" And we own the house already and it's too big just for the two of us, but I don't know. I don't know if I want to leave. So, it's a good question to talk about with your advisor, for sure.   Marc: Yeah. I mean, and it could, to your point, I mean, obviously add some significant capital to a retirement plan depending on, again, what you were going to do. Are you going to just maybe rent? Were you going to get a condo or a townhouse? But those have gotten really pricey lately too. So, it's a worthwhile exercise for sure to see what it could-   Tony Mauro: That's right.   Marc: ... do to your overall retirement plan.    Number two on that list, Tony, was supporting or financially supporting the adult children, sell this item. I absolutely agree with this one, me personally. But I mean, and it's hard for parents to go against the instinct of helping, but you can't finance retirement, Tony.   Tony Mauro: You can't, and I agree with you and with this point too. It is hard, I go through it with my own kids. Now I have a grandchild, and that's although I'm going to do whatever I want with her, but... And there's books been written about it about the... And I think it was from The Millionaire Next Door, I think it was from the book, but somebody was saying that that's economic triage. And then what happens is if you start supporting them, then they expect it. And like you said, they're going to have to go out and build their own [inaudible 00:04:29]-   Marc: And they've got decades still to do it, you don't.   Tony Mauro: They've got a lot of time, yeah. And you're running out of time. And so, I would limit this if you're going to do it at all, and try not to do it. Just for nothing else, hopefully they can figure things out on their own and become their own financially responsible adults, but obviously we're there as parents if they really fall, but I strongly urge my clients, yeah, not to do this.   Marc: Yeah. You made an interesting point too, if they really fall, yes. But I mean, look, at the same time, no, because you're going to have to sometimes, you got to rein it in, especially if your plan is just barely getting you the retirement that you needed or not even the dream retirement but just getting you into it and through it, allowing you to stop working or whatever, every situations are different, you can't sacrifice that to help them. I mean, I know it's tough, but sometimes you just got to bite that bullet or they've got to bite that bullet. But isn't it funny though how like throughout time it's some weird thing like, "Oh, well this is the grandkid and the grandkid is now more important than you. Sorry, bye."   Tony Mauro: I tell you what, it's hard. It really is, because you get like... I never thought I would be like that, but yeah, and you want to ensure their future. I don't know why.   Marc: Well, maybe because they're little and it's like it takes you back to when yours were little. And of course, we're typically in a better position when we have the grandkids to help them out. So, that probably has something to do with it too.   Tony Mauro: That has something to do with it, exactly.   Marc: Yeah, yeah. Good stuff. All right. Number three, expensive toys that become expensive burdens. Some of us spend a lot of years, Tony, the 30s to mid 50s collecting those toys and doing things that we like. And then you just one day go, that's a lot of crap.   Tony Mauro: It is, and I admit it.   Marc: Do I want it? Do I need it? Right?   Tony Mauro: Yeah. And we've all been guilty of it, whether it's a boat, you name it, a classic car.   Marc: Yeah, a travel trailer, whatever.   Tony Mauro: If you've got money, yeah, airplane, something like that. If you're not using this stuff and really don't enjoy it, you do have to start asking yourself is, do the cost of these things sitting around actually match what the enjoyment that I get out of them? For me, a lot of things is not. Things don't interest me as much as they did when I was younger. And now that you, most of the time you get a little closer to retirement, in retirement, you have the money to pay for them. But it's like, yeah, just because I can do it, I don't really necessarily get enough enjoyment out of it to just have it sitting around. Then I've got maintenance and everything else and it just freaks me out. But this is something to talk about with your advisor, especially, if you're looking at all of your assets, which your advisors should know about, not just your investments. He or she should know about everything you have.   Marc: Good point, yeah.   Tony Mauro: They may be able to advise you, "Hey, do you still enjoy this? If so, let's keep it in. If not, well, what can we do with that money to get you more enjoyment?"   Marc: Good point. And in that list, and you could have maybe put point number four here in point number three, but maybe not. I get where they're going from this, but I have a real hard time with this one, Tony. So, this will be fun to-   Tony Mauro: I do too.   Marc: Yeah, this will be a fun debate here. It's the second car. Now the argument is without the commute, two cars sitting in the garage maybe costing more than they're worth in insurance, maintenance, and so on and so forth. And granted, at a certain age, maybe this becomes more realistic, right? But you think about retirement, people are more active, they're more healthy in early days of retirement. The loss of freedom to an American is a huge deal. I mean, think about our country, our identity for, God, since the '50s has been tied up in the car, right? When we built the interstate system and all the vehicles and everything, I mean, this is a big country. And when you want to jump in the car and go someplace, even if it's down the street to the store, you want to be able to have the freedom to do that, right?   Tony Mauro: You do. And I don't have many clients, they talked about it on the video. It might be from a strict, strict planning standpoint, might be something to consider. And again, I maybe asked the question, but you hit it on the head with the word freedom, is that less Americans, at least me I know and almost everybody I know, do not want to give up that freedom of I can go, like you said, get in it and go wherever I want.   Marc: Yeah. Well, Tony, you travel a lot to Europe, right? You were just talking about that on our last podcast, right? Europe is designed differently. They walk everywhere.

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About

Financial, tax and retirement planning guidance from Tony Mauro. Tony is the original Tax Doctor, serving central Iowa. We’ll teach you how to properly plan for retirement, minimize your tax burden and attain a successful financial future.

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  • Creator
    Tony Mauro
  • Years Active
    2019 - 2026
  • Episodes
    98
  • Rating
    Clean
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    © Copyright Tony Mauro
  • Show Website
    Plan With The Tax Man