Joe Anderson, Author at ROI TV

How to Retire Smarter: Tax Strategies, Rental Property Tips, and Giving Back

Joe Anderson — Sun, 22 Jun 2025 12:19:56 +0000

Planning for retirement requires more than just saving—it demands strategy. From managing tax brackets to navigating charitable giving and protecting real estate investments, this article covers smart financial decisions that can help you retire with confidence.

Let’s start with Roth conversions. Alex from Massachusetts asked whether he should convert more of his traditional IRA into a Roth while staying in the 24% tax bracket. Even if he remains in that bracket, the flexibility of Roth accounts is invaluable. Roth IRAs allow for tax-free withdrawals and are not subject to required minimum distributions (RMDs), giving you more control over your income in retirement. Plus, if one spouse passes away, the surviving spouse may be taxed at a higher single rate, making Roth conversions even more compelling. Putting higher-growth investments into a Roth also means more long-term gains without added tax burdens.

Then there’s Steve from San Diego. In just five years, he grew his portfolio from $100,000 to $775,000 by following tough-love advice from Joe and Big Al. With $40,000 from work and $47,000 from Social Security, his income is nearly covering his $100,000 annual expenses. The suggestion? He may be able to retire soon, but adding a bit more to savings and shifting some investments to safer assets can help protect against sequence-of-return risk—the danger of retiring during a market downturn.

Now let’s talk about real estate. Mike asked whether forming an LLC for his three duplexes would help with taxes. The short answer is no—LLCs don’t provide tax benefits for rental properties. Their primary value lies in asset protection. If a tenant sues, the LLC can shield your personal assets. While separate LLCs for each property offer the most protection, they also come with higher administrative costs. Liability insurance can be a simpler alternative or complement.

Charitable giving is another area where strategy matters. Qualified Charitable Distributions (QCDs) allow individuals over 70½ to donate directly from their IRA to charity—up to $100,000 annually, indexed for inflation. This reduces taxable income and fulfills RMD requirements. QCDs are ideal for those who are charitably inclined and taking the standard deduction.

For larger charitable intentions, Charitable Remainder Trusts (CRTs) or specifically Charitable Remainder Unitrusts (CRUTs) may be worth exploring. Horry wanted to know if he could use his IRA to fund a CRUT. Yes, but the structure must ensure at least 10% of the trust’s value goes to charity. The trust sells assets tax-free, provides income to the donor, and then donates the remainder. However, because CRUTs have administrative costs and complex tax rules, they’re best suited for those with significant assets.

Finally, Joe and Big Al reminded us of the importance of lowering equity risk as you approach retirement. Markets fluctuate, and pulling from stocks during downturns can rapidly drain your portfolio. Keeping enough in cash or bonds to cover a few years of expenses can help ride out rough markets without touching your long-term investments.

Retirement planning isn’t one-size-fits-all. But with careful tax management, smart charitable strategies, and a balanced investment approach, you can make your money last and leave a legacy you’re proud of.

Intended for educational purposes only. Opinions expressed are not intended as investment advice or to predict future performance. Past performance does not guarantee future results. Neither the information presented, nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Consult your financial professional before making any investment decisions. Opinions expressed are subject to change without notice.

IMPORTANT DISCLOSURES:

• Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, LLC. A Registered Investment Advisor.

• Pure Financial Advisors, LLC. does not offer tax or legal advice. Consult with a tax advisor or attorney regarding specific situations.

• Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

• Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

• All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.

• Intended for educational purposes only and are not intended as individualized advice or a guarantee that you will achieve a desired result. Before implementing any strategies discussed you should consult your tax and financial advisors.

The post How to Retire Smarter: Tax Strategies, Rental Property Tips, and Giving Back appeared first on ROI TV.

How Much Do You Really Need to Retire? Breaking Down the Numbers and Strategies

Joe Anderson — Thu, 19 Jun 2025 12:33:09 +0000

It’s one of the most common financial questions I hear: “How much do I really need to retire?” The answer is different for everyone—but one thing’s clear: most people are underestimating what it takes.

Alan Clopine and I will walk you through the numbers, the strategies, and the traps to avoid so you can retire with confidence. Here’s what you need to know.

1. Retirement Savings: The Real Targets

People love to throw around round numbers—$500,000, $1 million—but retirement planning is more complex than that.

Longevity matters. If you’re 65 today, you’re likely to live well into your 80s or even 90s. That’s a long time to fund.
Healthcare is a big expense. The average 65-year-old couple spends around $315,000 on medical costs over their lifetime.
Inflation silently eats your purchasing power. At 3% annually, your dollar loses half its value in about 24 years.
Taxes aren’t going anywhere. Pre-tax accounts like 401(k)s will be taxed as income later, while Roth IRAs grow tax-free. Knowing where your dollars live matters.

To plan right, you need to look at your spending habits, location, expected health costs, and tax positioning—not just the balance in your account.

2. Generating Income in Retirement

Once you’ve saved, the next question is: How do I make it last?

We explored the pros and cons of two common strategies:

Annuities

Offer guaranteed income for life by shifting risk to an insurance company.
A 67-year-old investing $1 million could get $6,300/month, based on Schwab’s estimator.
Downsides? High fees, lack of flexibility, and surrender penalties.

Investment Portfolios

More potential for growth and flexibility.
But they come with market volatility and require smart withdrawal strategies.

We modeled different withdrawal timelines using a 6% return:

$19,000/month for 5 years
$8,500/month for 15 years
$6,400/month for 25 years
$5,600/month for 35 years

It’s all about balancing income, flexibility, and longevity.

3. Social Security Timing: The Game Changer

Social Security makes up 50% or more of income for over half of retirees—so getting the timing right is key.

Claiming at 62 reduces your benefit by up to 30% permanently.
Waiting until age 70 can increase your benefit by up to 75% compared to early filing.
Married couples should coordinate benefits to maximize their lifetime payout.

For most people, it pays to delay if you can afford to—especially if you’re in good health.

4. Want to Become a Millionaire?

It’s more doable than you might think—if you start early.

At 30, save $700/month.
At 40, save $1,400/month.
At 50, save over $3,000/month.

Start small, automate it, and take full advantage of employer matches. Once you hit age 50, don’t forget catch-up contributions—they can turbocharge your savings.

5. Stretching Retirement Dollars Further

Not all retirement savings strategies are about investing—cost control is just as powerful.

Downsize your home.
Move to a tax-friendly state. Leaving California for West Virginia could save $30,000/year in living costs.
Trim discretionary spending. Dining out less and traveling smarter can add years of runway to your retirement funds.

We also recommend reviewing your debt picture and aiming for a lean balance sheet heading into retirement.

6. Use the Free Financial Blueprint

Don’t guess—know where you stand.

Our Financial Blueprint Tool at YourMoneyYourWealth.com lets you plug in your numbers and see where you land. It gives you a clear outlook:

All Good
Average
Needs Help

The best part? It’s free, and you can do it from the comfort of your home.

Bottom line: Retirement is more than a number. It’s about strategy—income, taxes, inflation, lifestyle, and timing. With the right tools and planning, you can retire comfortably and stay there.

IMPORTANT DISCLOSURES:

• Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, LLC. A Registered Investment Advisor.

• Pure Financial Advisors, LLC. does not offer tax or legal advice. Consult with a tax advisor or attorney regarding specific situations.

• Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

• Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

• All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.

The post How Much Do You Really Need to Retire? Breaking Down the Numbers and Strategies appeared first on ROI TV.

Top Retirement Regrets and How to Avoid Them Before It’s Too Late

Joe Anderson — Tue, 17 Jun 2025 12:21:50 +0000

Retirement is supposed to be the reward for decades of hard work—but for many, it brings along some serious “I wish I had…” moments. From saving too little to misjudging healthcare costs, regret can be a powerful teacher. Fortunately, if you’re still in the planning stage, you can use others’ hindsight as your foresight.

1. The Most Common Regrets in Retirement
Nearly 8 out of 10 retirees say they wish they had saved more. Sixty-three percent regret not having a detailed financial plan. And 54% say they never planned properly for inflation. Healthcare is another pain point—many underestimate medical expenses or skip supplemental policies like Medigap, only to regret it later. Social Security is also a frequent misstep. Claiming early can permanently reduce your monthly benefit by 25–30%. And 40% of retirees regret entering retirement with high-interest debt like credit cards and car loans, which erode fixed incomes.

2. Financial Planning: The Cure for Regret
Regret often comes from not planning. That’s why calculating your net worth, tracking your cash flow, and projecting your monthly needs is so critical. Joe and Big Al stress maximizing 401(k) contributions—especially the catch-up option if you’re over 50—and diversifying your savings buckets. Relying only on tax-deferred accounts can backfire in retirement. And don’t ignore inflation: $50,000 in annual expenses today may cost $90,000 in 20 years.

3. Social Security: Timing Is Everything
Most people claim Social Security at 64, but delaying until age 70 can increase your benefit by 8% annually after full retirement age. That can mean a 70% higher check compared to claiming at 62. Waiting may not be ideal for everyone, but building Social Security into your broader strategy—alongside your other income sources—can help you avoid lifelong regrets.

4. Don’t Rush Into Housing Changes
Selling your house or moving away from your social network might sound smart financially—but it often leads to regret. Retirees have shared that leaving too quickly led to isolation and logistical headaches. Joe and Big Al suggest “test-driving” new locations with short-term rentals before making big decisions. Compatibility with your lifestyle matters more than property values.

5. The Role of Passive Income
Many retirees wish they had built more passive income streams—dividends, real estate, bond ladders, and synthetic dividends through ETFs or mutual funds. These assets create reliable income without the need to withdraw principal. But diversification still matters. Chasing yield can increase risk or tax liability. A balanced portfolio helps smooth the ride.

6. The Debt Problem
Debt is a major regret—especially credit card balances, auto loans, and even student debt. Joe and Big Al recommend organizing all debts and creating a payoff strategy like the snowball or avalanche method. It’s not just about entering retirement debt-free—it’s about managing the debt you have with a clear plan and low stress.

7. What Retirees Say About Their Lifestyle
Some retirees wish they had spent more on experiences and less on things. Others found that retirement left them bored or struggling to find purpose. The transition from work to retirement is harder than most expect. Even spending more time with your spouse can create new tension after decades of work-life separation. Be intentional about filling your days with meaning, not just leisure.

8. Health and Longevity: The New Retirement Frontier
As Mickey Mantle once said, “If I knew I was going to live this long, I’d have taken better care of myself.” That line hits hard in retirement. Today’s retirees are more health-conscious, and it pays off. A healthy lifestyle doesn’t just reduce costs—it boosts energy and longevity. Make exercise, nutrition, and mental well-being part of your retirement plan.

9. The Retirement Curveball: Early Exits
Over half of retirees leave work earlier than planned—due to health issues, caregiving needs, or workplace dissatisfaction. And for 1 in 5, the emotional adjustment is tougher than expected. That’s why financial freedom alone isn’t enough. You need purpose, connection, and routine to thrive.

Final Thoughts
Regret doesn’t have to be part of your retirement story. Learn from those who’ve been there—build a strategy that includes flexibility, health planning, social connection, and real income. With the right plan, retirement can be everything you dreamed—minus the “should haves.”

IMPORTANT DISCLOSURES:

• Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, LLC. A Registered Investment Advisor.

• Pure Financial Advisors, LLC. does not offer tax or legal advice. Consult with a tax advisor or attorney regarding specific situations.

• Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

• Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

• All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.

The post Top Retirement Regrets and How to Avoid Them Before It’s Too Late appeared first on ROI TV.

How to Maximize Social Security, Roth Conversions, and Retirement Spending Without Losing Sleep

Joe Anderson — Sun, 15 Jun 2025 12:19:54 +0000

Planning for retirement isn’t just about having enough—it’s about making smart decisions to keep more of what you’ve saved. This week’s conversation really drove that home as we tackled Social Security timing, tax-smart Roth conversions, and whether expensive annuities and adviser fees are worth it.

1. The Social Security Puzzle
Richie and Heather from Idaho are facing a common but tricky decision—when to claim Social Security. Richie wants to wait until full retirement age in 2029, and Heather is considering claiming at 62 in 2025. But we walked through the math together and saw that delaying until 70 could significantly boost their lifetime income, especially for Heather’s survivor benefits. Her monthly benefit could grow from $1,830 at 62 to $3,358 at 70. And Richie? From $2,747 to $4,789. That’s a serious increase.

We always remind couples to weigh their Social Security timing against other income sources like IRAs and brokerage accounts. If you draw from those first, you might avoid higher taxes and give your Social Security more time to grow.

2. Strategic Roth Conversions
We also looked at how Roth conversions could help Richie and Heather reduce their future tax burden. Since they’re currently in a lower tax bracket, converting portions of their traditional IRA into a Roth IRA now—up to the top of the 12% bracket—makes a lot of sense. That way, they avoid larger required minimum distributions (RMDs) later and keep their brokerage account liquid for near-term spending needs.

3. Coordinating Retirement Spending and Portfolio Allocation
Their $2.625 million portfolio is in a 60/40 equity-to-fixed-income mix, and they plan to spend $120,000 per year (not including taxes). That gives them a lot of flexibility, but we encouraged them to avoid viewing their accounts as separate “buckets.” Instead, it’s better to manage the entire portfolio as one cohesive plan. For example, they’re withdrawing $50,000 soon to upgrade their travel trailer, and we talked about how to time that without triggering a big tax hit or pulling from equities in a down market.

4. A Cautionary Tale About Indexed Annuities
Rebecca and Sam from Virginia called in with a major regret: a $1 million indexed annuity they bought in 2022. Rebecca was frustrated with the confusing terms and underwhelming growth. We showed them that in many cases, these annuities take 20 years just to break even. While they offer “guaranteed income,” the trade-off is poor long-term performance. They’re now considering cashing out at the $954,000 surrender value—yes, that’s a $50,000 loss, but it may be worth the freedom to reinvest elsewhere.

5. Overpaying for Financial Advice
To make matters worse, Rebecca and Sam’s adviser is charging them 2% annually on their $1.2 million portfolio. That’s $24,000 per year—far above the industry standard of 0.60% to 0.70%. And if that adviser also earned a hefty commission on the annuity sale, that’s a red flag. We encouraged them to get a second opinion from a fiduciary who puts their interests first and charges a fair rate.

6. Don’t Bank on Social Security Tax Reform
Gerri from Phoenix asked about Donald Trump’s proposal to eliminate taxes on Social Security. While it sounds good, we don’t expect it to happen. These ideas tend to surface during campaign season but rarely materialize. We told Gerri to stick to his current strategy of waiting until 70 to claim benefits—because solid, long-term planning beats political speculation every time.

7. Claiming Social Security with a Twist: The Lump Sum Option
Pete Ware chimed in with an advanced tactic: waiting until age 70.5 to claim Social Security and then requesting six months of retroactive payments. That lump sum wouldn’t reduce the ongoing benefit amount, and it would create a full year for Roth conversions without Social Security income inflating the tax bill. It’s a smart move for the right person, but like any strategy, it needs to be part of a broader financial plan.

The Takeaway
Every decision in retirement has a ripple effect. Claiming Social Security early might cost you thousands over time. Overpaying for advice could mean retiring later than you’d like. And an annuity that feels “safe” could quietly erode your nest egg. But with careful planning—especially around taxes—you can make the most of your savings and build a secure, tax-efficient retirement.

IMPORTANT DISCLOSURES:

• Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, LLC. A Registered Investment Advisor.

• Pure Financial Advisors, LLC. does not offer tax or legal advice. Consult with a tax advisor or attorney regarding specific situations.

• Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

• Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

• All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.

The post How to Maximize Social Security, Roth Conversions, and Retirement Spending Without Losing Sleep appeared first on ROI TV.

Break Through Retirement Barriers with These Smart Financial Strategies

Joe Anderson — Thu, 12 Jun 2025 11:17:01 +0000

Why Most Americans Struggle with Retirement Planning
Joe Anderson and Big Al opened the discussion with a sobering stat: 77% of people don’t have a written retirement plan. Only 21% have one on paper, while the rest rely on mental plans—or no plans at all. Their recommendation? Start with the basics. Calculate your net worth by subtracting liabilities from assets, evaluate your monthly cash flow, and begin saving—even if it’s just $50 per month.

Automate Your Savings Early
Starting early gives your money time to grow, and automating your savings ensures consistency. Set up recurring transfers to your 401(k), IRA, or savings account. Joe and Big Al emphasize the concept of “paying yourself first” to prioritize future stability over short-term indulgence.

Understanding Market Behavior and Diversification
Markets fluctuate. A 15% drop within a five-year period is normal. Joe and Big Al stressed diversification—spreading money across cash, stocks, bonds, and alternative assets—tailored to your timeline and goals. This cushions your portfolio against volatility and avoids emotional, fear-based decisions.

Build an Emergency Fund and Tackle Debt
They recommend saving enough to cover 3–6 months of living expenses in an emergency fund. When it comes to debt, consider balance transfers, consolidation, or negotiating with lenders. Use the avalanche method (highest interest rate first) or snowball method (smallest balance first) to stay motivated and make progress.

Smart Moves for Childcare and Health Costs
Childcare costs can consume up to 27% of a family’s income. Consider a Flexible Spending Account (FSA), which allows $5,000 in tax-free savings. You might also qualify for up to $1,050 per dependent through the child care tax credit. For health expenses, Health Savings Accounts (HSAs) offer another tax-advantaged strategy, with contribution limits of $4,150 for individuals and $8,300 for families in 2024.

Managing Student Loan Debt
Federal student loan debt averages $40,000. Joe and Big Al highlighted income-driven repayment plans as a helpful option. They also pointed out that employers can provide up to $5,250 in tax-free assistance toward your student loans—a benefit more companies are starting to offer.

Boosting Retirement Savings with Catch-Up Contributions
If you’re over 50, take advantage of catch-up contributions: an additional $7,500 for 401(k)s and $1,000 for IRAs. Beginning in 2025, those limits will increase. Redirecting bonuses, tax refunds, or raises into your retirement accounts can accelerate your savings without changing your lifestyle.

The Overspending Trap
Even though 80% of people say they have a budget, most don’t stick to it. Joe and Big Al suggest using budgeting apps, tracking discretionary expenses, and distinguishing between needs and wants. Overspending during retirement—on travel, luxury vehicles, or home renovations—can shorten the lifespan of your savings.

Plan for a Longer Retirement Than You Expect
Americans are living longer—up to 87 years for women and 85 for men by 2050. Many people plan to work into their late 60s, but early retirement often becomes necessary due to health or employment issues. Trimming your budget by just 10% could stretch your savings by five years.

Get Personalized Help with the Financial Blueprint
To make all of this easier, Joe and Big Al recommend using the free “financial blueprint” tool available on the Your Money Your Wealth website. It shows whether you’re on track and what to change if you’re not. With the right tools, a few smart habits, and consistent effort, you can break through retirement barriers and create long-term financial freedom.

IMPORTANT DISCLOSURES:

• Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, LLC. A Registered Investment Advisor.

• Pure Financial Advisors, LLC. does not offer tax or legal advice. Consult with a tax advisor or attorney regarding specific situations.

• Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

• Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

• All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.

The post Break Through Retirement Barriers with These Smart Financial Strategies appeared first on ROI TV.

Your 11 Step Path to Financial Freedom

Joe Anderson — Tue, 10 Jun 2025 14:40:11 +0000

Everyone wants financial freedom—but most people don’t have a plan to get there.

In this episode of Your Money, Your Wealth, Big Al Clopine and I laid out 11 specific steps that can guide you toward building and sustaining true financial independence. It’s not just about saving more—it’s about thinking strategically and living intentionally.

Here’s how you can get there:

Step 1: Take Inventory of Your Net Worth

Start by calculating your net worth:
Assets – Liabilities = Net Worth

List out your:

Bank accounts
Retirement savings
Real estate
Jewelry or valuables
Any business assets

Then subtract your:

Credit card balances
Student loans
Car loans
Mortgage

You have to know where you’re starting before you can plot a course forward.

Step 2: Understand Your Cash Flow

Track your monthly income and expenses. Ask:

What’s coming in consistently?
Where is it going?
Are you spending more than you earn?

Financial freedom depends on positive, intentional cash flow, not just a big salary.

Step 3: Define What Financial Freedom Means to You

It’s different for everyone:

54% say it means being debt-free
50% say it means living comfortably
Only 13% say it means being rich

Your version of financial freedom should reflect your values, not someone else’s lifestyle.

Step 4: Pay Off Bad Debt

High-interest debt—especially credit cards—kills financial momentum. Example:

$8,600 balance
$272/month payment
53 months to pay off
$5,600 in interest!

Make a plan to eliminate debt aggressively.

Step 5: Build an Emergency Fund

Before you invest or upgrade your lifestyle, save 3–6 months of essential expenses. This keeps you from falling back on credit cards during life’s unexpected turns.

Step 6: Invest Strategically

Once you’ve got cash flow and a safety net, invest intentionally. Consider:

Diversified stock and bond portfolios
Real estate
Business ventures
Index funds

Remember: your investment mix should match your goals and risk tolerance.

Step 7: Maximize Tax-Advantaged Accounts

Use every tool the tax code gives you:

401(k) or 403(b) — often with employer matches
Traditional and Roth IRAs
HSAs (if you’re eligible)

This reduces your tax bill now and in retirement.

Step 8: Consider Roth Conversions

Converting traditional IRA or 401(k) funds into a Roth lets you pay taxes now at lower rates and enjoy tax-free withdrawals later. It’s a smart move for many people in lower-income years or before RMDs hit.

Step 9: Create Passive Income Streams

These give you freedom from needing a paycheck:

Rental properties
Dividends and interest
Royalties or side hustles
Social Security (claimed strategically)

The goal: income that supports your lifestyle—even if you stop working.

Step 10: Adjust As Life Changes

Markets shift. Tax laws change. Health and goals evolve.

Revisit your financial plan annually:

Are your investments aligned with your risk?
Are your goals the same?
Do your withdrawal strategies need a tweak?

Financial freedom isn’t static—it’s dynamic.

Step 11: Think About Sustainability, Not Just Wealth

The final key? Sustain it.

Don’t burn out. Don’t blow it. Create systems that let you enjoy your money, give back, and live with purpose. That’s what real freedom looks like.

Final Thoughts

There’s no magic number for financial freedom—but there is a strategy. These 11 steps are designed to take you from wherever you are to a place where your money supports your life—not the other way around.

Start small. Stay consistent. And remember: freedom isn’t just for the rich. It’s for anyone willing to plan for it.

IMPORTANT DISCLOSURES:

• Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, LLC. A Registered Investment Advisor.

• Pure Financial Advisors, LLC. does not offer tax or legal advice. Consult with a tax advisor or attorney regarding specific situations.

• Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

• Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

• All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.

The post Your 11 Step Path to Financial Freedom appeared first on ROI TV.

How to Actually Reach Financial Freedom: The Strategy That Works

Joe Anderson — Mon, 09 Jun 2025 11:50:44 +0000

Financial freedom looks different for everyone. For some, it means being debt-free. For others, it’s about living comfortably. But at the end of the day, true financial freedom comes when your passive income covers your lifestyle and you no longer have to work unless you want to.

In this week’s episode, Big Al Klopp and I broke down exactly what it takes to get there and stay there. It’s not just about saving more; it’s about thinking differently about money, time, and the future.

What Financial Freedom Really Means

According to recent data, 54% of people define financial freedom as being debt-free, and 50% say it’s about living comfortably. Only 13% equate it with being rich.

For us, financial freedom means your passive income matches or exceeds your expenses. That’s the point where you get to choose how you spend your time.

But here’s the catch: freedom comes from cash flow, not just net worth. If you have millions in assets but no income from them, you’re still on the clock.

The Roadblocks That Get in the Way

Most people don’t get stuck because they’re lazy. They get stuck because of:

Not saving enough
Carrying too much debt
Living paycheck to paycheck
Emergencies that wipe out savings

Take credit card debt as an example. The average balance is $8,600, and if you pay just $272 per month, you’ll be at it for 53 months and spend $5,600 in interest.

If you want freedom, the first step is cutting the chains and for many, that starts with credit cards.

3 Steps to Financial Freedom

Big Al and I recommend this simple process:

Inventory – Know your numbers: assets, liabilities, net worth
Invest – Grow your money through smart allocation
Sustain – Build systems to maintain freedom over time

Calculating your net worth is key. Add up what you own (bank accounts, retirement plans, real estate, etc.) and subtract what you owe (mortgages, loans, credit card balances). That’s your starting point.

And remember: always pay yourself first. Before you spend on wants, contribute to your 401(k), IRA, or savings account.

Taxes: The Sneaky Expense That Eats Your Freedom

Taxes are one of the biggest threats to financial independence. In California, a single filer earning $100,000 nets just $72,000 after taxes.

Want to fight back? Use:

401(k) and IRA contributions to lower taxable income
Roth accounts for tax-free growth
Capital gains strategies married couples can pay 0% on gains if income is under $94,000

And don’t forget: IRA and 401(k) withdrawals in retirement are taxed like ordinary income. Plan ahead, or risk surprise tax bills later.

Retirement Savings: It’s Never Too Early (But Don’t Wait)

The math is simple. If you start saving $700/month at age 30, you could hit $1 million by 65. Wait until 50, and you’ll need $3,500/month to get there.

That’s the power of compound interest time is your biggest ally.

If you’re self-employed, look into:

Solo 401(k)s
SEP IRAs
SIMPLE plans

And if your employer offers a match? Don’t leave free money on the table.

Build an Emergency Fund (Before You Need It)

Before you start investing aggressively, make sure you’ve got 3–6 months of expenses saved in a high-yield savings account. This keeps you from falling back on high-interest credit cards during emergencies.

Also:

Set up automatic bill payments
Monitor your accounts
Improve your credit score by paying on time and keeping usage low

Passive Income: The Secret Sauce to Sustainable Freedom

Want freedom? You need income streams that don’t depend on you clocking in.

Some options include:

Rental properties
REITs
Dividend-paying stocks
Social Security

If you wait until age 70 to claim Social Security, you’ll get 124% more than if you claim early. That’s a massive difference.

Plus, don’t underestimate side hustles like freelancing, consulting, or tutoring especially in the early stages of retirement.

Keep Adjusting Because Life Will

Markets change. Taxes change. Health changes. You need a plan that can adapt.

That’s why we talk about the 4% rule a guideline, not gospel. Some years, you may need to pull back to preserve your portfolio. That’s called managing sequence of returns risk retiring into a bad market could force you to sell investments at a loss.

Check in on your plan regularly and pivot when needed. Flexibility is freedom.

Final Thoughts

Financial freedom isn’t about getting rich. It’s about getting clear. Clear on your income, your expenses, your values, and your goals. It’s about using your money to support the life you want—not the other way around.

Whether you’re just getting started or refining your strategy, remember this: it’s possible. You can have a plan that works, a life that feels right, and a future you’re excited about.

You just have to start.

IMPORTANT DISCLOSURES:

• Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, LLC. A Registered Investment Advisor.

• Pure Financial Advisors, LLC. does not offer tax or legal advice. Consult with a tax advisor or attorney regarding specific situations.

• Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

• Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

• All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.

The post How to Actually Reach Financial Freedom: The Strategy That Works appeared first on ROI TV.

Real Retirement Plans That Work and Don’t

Joe Anderson — Sun, 08 Jun 2025 12:51:39 +0000

When it comes to retirement planning, no two paths are the same. That’s what I love about what we do at ROI TV diving deep into real stories with real people and real numbers.

This week, we walked through three very different retirement plans John Pierre, Tiger (not Woods), and James & his wife and each one had a different challenge: risk management, lifestyle creep, or navigating legacy wealth. I’ll take you through each, so you can see how we tackled their goals and avoided the most common pitfalls.

John Pierre: A Near-Retiree Without Bonds

Let’s start with John Pierre, age 61, and his wife, 58. They plan to retire in the next year or two and want to spend about $150,000 annually, with $80K for basic expenses and $50K for travel.

Their portfolio? Impressive:

$2M in 401(k)s and IRAs
$500K in Roth accounts
$3M in brokerage
$200K in cash
Zero bond allocation

That last part? A red flag.

Joe and Big Al advised a 20–25% bond allocation—about $1.5M—to create a 10-year buffer of “safe money” during potential market downturns. That allows the rest of their portfolio to stay in equities for growth, but with a cushion to ride out the bad years.

We also talked about using municipal bonds in taxable accounts. They’re tax-efficient and can help smooth the process of Roth conversions, which we’re starting in 2025. Risk tolerance is critical here, especially if your gut tells you to sell during a downturn. Build your plan around how you actually behave, not how you wish you would.

Tiger (Not Woods): The Overconfident Millennial Millionaire

Tiger is 33, and he and his wife make $240,000 a year. Their numbers:

$3.2M net worth
$2M in brokerage
$1M in pretax retirement
$150K in Roth
$375K in crypto
$1M home with a 2.75% mortgage

He’s planning to retire when his taxable account hits $2.8M—and that’s excluding crypto. Add to that a potential $5 million inheritance, and you can imagine why Tiger feels like he’s winning the game.

But here’s the warning: overconfidence bias. Just because you hit it big once with a few stocks or crypto doesn’t mean that strategy will work forever.

Tiger wants to cut his retirement contributions, spend an extra $2,000/month, and lean into brokerage investments. Joe and Big Al hit the brakes. Inheritance is not a financial plan. And speculative returns are not predictable. The advice? Stay disciplined, keep saving, and don’t let lifestyle creep sabotage your future freedom.

James & His Wife: Rich in Assets, Not in Income—Yet

James and his wife, both 60, want to retire next year on $180,000 annually. Their portfolio:

$2M in 401(k)s
$2M in deferred compensation
Purchased annuities with GLWBs (guaranteed lifetime withdrawal benefits)

They’ll get:

$47K/year from annuities starting at 65
$20K/year more from annuities starting at 74
$50K/year in Social Security starting at 70

They’re also planning aggressive Roth conversions throughout their 60s to reduce the tax burden before RMDs (required minimum distributions) begin at 73.

Joe and Big Al offered a balanced take. They’re not the biggest fans of annuities (they usually benefit the insurance company more than you), but in this case, they work well as a bond substitute. That gives James room to take more risk with liquid assets to drive growth and liquidity for those planned conversions.

Why Delaying Social Security Matters

If you can afford to delay claiming Social Security, it can be one of the most powerful tools in your retirement plan. You gain 8% per year in delayed retirement credits plus COLA (cost-of-living adjustments).

But it’s not just about the math. Seeing your account balances drop in a market downturn while you delay withdrawals can be scary. That’s why Joe and Big Al always talk about Social Security as longevity insurance. You may not need the money at 62 but you might at 85. Plan accordingly.

Big Picture Advice

Here’s what all three scenarios had in common:

Don’t rely on speculation or inheritance
Keep a balanced asset allocation
Know your true risk tolerance, especially once you stop working
Avoid lifestyle creep your future self will thank you
Make automated saving part of your plan so you don’t spend what you don’t see

We say this every week, but it’s worth repeating: retirement planning isn’t just about the numbers. It’s about behavior, discipline, and having the flexibility to adapt as life evolves.

IMPORTANT DISCLOSURES:

• Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, LLC. A Registered Investment Advisor.

• Pure Financial Advisors, LLC. does not offer tax or legal advice. Consult with a tax advisor or attorney regarding specific situations.

• Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

• Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

• All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.

The post Real Retirement Plans That Work and Don’t appeared first on ROI TV.

Your Retirement Recipe: Savings, Plans, and Financial Freedom Tools

Joe Anderson — Thu, 05 Jun 2025 11:55:55 +0000

Retirement planning doesn’t need to be intimidating. Think of it like following a recipe. You need the right ingredients, a step-by-step method, and maybe a little guidance from experts. That’s exactly what Joe Anderson and Big Al delivered with their “recipe for retirement” strategy designed to help you mix savings, smart tax moves, and income planning into a sustainable path toward financial freedom.

The Retirement Blueprint Starts with Saving

Just like no Italian dish is complete without pasta, no retirement plan works without savings. It’s the base of everything. Joe and Big Al emphasized the importance of having a financial blueprint, a personalized guide you can use to see if your current strategy matches your long-term goals. It’s a free tool they recommend to get started—plug in your numbers and get a roadmap.

Understanding Defined Contribution Plans

You’ve likely heard of 401(k), 403(b), or 457 plans. These are defined contribution plans employer-sponsored retirement accounts where you choose how much to save, and the final benefit depends on your contributions and investment returns.

In 2024, you can contribute up to $23,000 to these plans or $30,500 if you’re over 50. Many employers match 4-6% of your salary, so at the very least, you should contribute enough to grab that free money.

If you work in schools, hospitals, or other public service roles, you may be eligible for both a 403(b) and a 457. That’s a huge advantage for supercharging retirement savings.

The Power of IRAs and Roth IRAs

For more flexibility, IRAs offer tax-deferred (Traditional IRA) or tax-free (Roth IRA) growth. You can contribute up to $7,000 annually—or $8,000 if you’re over 50. Roth IRAs are subject to income limits ($146,000 for singles and $230,000 for couples), but higher earners can still access them through a “backdoor Roth IRA.”

Spousal IRAs let non-working spouses save for retirement, and even minors with earned income can open an IRA starting them on the financial journey early.

Defined Benefit Plans: Old School, Still Powerful

While less common today, defined benefit plans (like traditional pensions and cash balance plans) still exist and offer guaranteed monthly income in retirement. They’re typically funded by the employer, with distributions taxed as ordinary income.

These plans focus on what you’ll receive rather than what you contribute unlike 401(k)s where the outcome depends on market performance.

Retirement Options for Entrepreneurs

If you’re self-employed, you’re not left out. Solo 401(k) plans allow you to contribute both as the employee and the employer, with a 2024 cap of $76,500 (if over 50).

SEP IRAs, funded by employers only, allow contributions up to $69,000 and they can be set up retroactively. SIMPLE IRAs are geared toward small businesses with employees, offering easier setup and lower contribution limits.

And since 2023, some of these plans even allow Roth contributions for those seeking tax-free growth.

Making the Most of Equity Compensation

Almost half of S&P 500 companies offer Employee Stock Purchase Plans (ESPPs), letting workers buy shares at up to a 15% discount. That discount is taxed as ordinary income, but it’s still a great perk especially if your company’s stock is on the rise.

Restricted Stock Units (RSUs) and stock options offer even more potential, but they also carry risks. If your compensation is heavily tied to your company’s stock, make sure to diversify. Otherwise, you could end up with too many eggs in one basket.

Evaluating Job Offers with ESPPs

A listener named Jill asked if it’s worth taking a lower-paying job with strong ESPP benefits. My advice? Look beyond just salary. If the company has growth potential and the stock benefit is strong, it could be worth the trade-off. But don’t base the decision on stock perks alone—consider the whole compensation package and your career goals.

S-Corp Owners and Retirement Contributions

Kyle from Seattle asked about retirement plan contributions as an S-Corp owner with no wages. Big Al made it clear: you need earned wages to contribute. Distributions don’t count. So Kyle would need to restructure how he pays himself if he wants to fund a retirement plan.

The Bottom Line

Retirement planning isn’t just about maxing out an account. It’s about understanding your options, using the tools available to you, and balancing growth with tax efficiency. Whether you’re a full-time employee, self-employed, or somewhere in between, there’s a recipe for your financial freedom. Start by saving, diversify your strategy, and stay informed as the rules evolve.

IMPORTANT DISCLOSURES:

• Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, LLC. A Registered Investment Advisor.

• Pure Financial Advisors, LLC. does not offer tax or legal advice. Consult with a tax advisor or attorney regarding specific situations.

• Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

• Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

• All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.

The post Your Retirement Recipe: Savings, Plans, and Financial Freedom Tools appeared first on ROI TV.

How to Stage a Retirement Comeback: Smart Strategies for Financial Freedom

Joe Anderson — Tue, 03 Jun 2025 11:50:13 +0000

Joe Anderson and Coach Big Al are sounding the alarm: 20% of people aged 50 and older have absolutely nothing saved for retirement. Meanwhile, over 60% of Americans are worried they won’t have enough to retire. With life expectancy stretching to age 90 and the average retirement age at 64, this financial gap is becoming increasingly dangerous. But it’s not too late. Here’s how you can stage a fourth-quarter comeback.

1. Assess Your Starting Point If you’re in your 50s or early 60s, the clock may be ticking, but the game isn’t over. Many people nearing retirement believe they need $1.6 million, yet the average retirement savings for those aged 55-64 is around $400,000. That’s a big gap, but Joe and Big Al show that with the right strategy, you can still create a workable plan.

2. Spending Adjustments Make a Big Difference In a case study of a couple in their mid-50s, reducing annual spending from $100,000 to $90,000 extended their retirement savings by six years. This single tweak made their money last until age 84 instead of 78. It turns out, cutting back a little on travel, dining out, or unnecessary subscriptions could make a big long-term difference.

3. Working Longer or Delaying Retirement If you can work an extra two years, you gain twice: more money saved and fewer years drawing from your savings. In the case study, working until 66 (instead of 64) had almost the same positive impact as cutting expenses by 10%.

4. Roth Conversions and Tax Strategies Taxes don’t retire when you do. Joe and Big Al recommend using Roth conversions to shift money from traditional accounts to Roth IRAs while you’re still earning. Doing so can lower your future tax burden and give you tax-free income in retirement. Just make sure you use non-retirement assets to pay the tax bill, or you’ll lose the compounding advantage.

5. Sequence of Return Risk Is Real The early years of retirement are vulnerable to market downturns. If your portfolio drops and you’re withdrawing funds at the same time, it can cripple your future. Maintaining a balanced allocation and keeping your withdrawal rate low can protect your savings during rough markets.

6. The Triple Lindy Strategy Joe and Big Al combine four power moves: save more, spend less, delay Social Security, and work longer. They call this the “Triple Lindy,” and it could extend your savings lifespan to age 94. These adjustments may seem small individually, but together they have a massive impact.

7. Take Advantage of Catch-Up Contributions Starting in 2025, Americans aged 60–63 can contribute 150% of the standard catch-up limit. That’s $11,250 in additional contributions annually. Someone starting from $0 at age 59 could still end up with $340,000 by age 67 with diligent saving and a 6% return.

8. Plan for Health and Long-Term Care Long-term care costs can derail even the best retirement plan. With assisted living averaging $65,000 per year and skilled nursing at $100,000, make sure to include healthcare planning in your retirement strategy.

9. Understand Your Spending Patterns While many advisors say you’ll spend 80% of your pre-retirement income in retirement, Joe and Big Al warn this varies widely. Some retirees spend more early on during the “go-go” years and later face higher healthcare costs. Plan for flexible spending.

10. Use a Realistic Rate of Return Expecting a 6% return on your 401(k) is a conservative and practical benchmark for planning. Stick to a 60/40 stock-to-bond allocation and avoid emotional reactions that lead to buying high and selling low.

Final Thoughts It’s never too late to stage a retirement comeback. With the right mix of spending adjustments, tax planning, catch-up contributions, and strategic timing, you can extend your savings well into your 90s. And who knows? You might end up better off than if you’d started early but planned poorly.

IMPORTANT DISCLOSURES:

• Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, LLC. A Registered Investment Advisor.

• Pure Financial Advisors, LLC. does not offer tax or legal advice. Consult with a tax advisor or attorney regarding specific situations.

• Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

• Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

• All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.

The post How to Stage a Retirement Comeback: Smart Strategies for Financial Freedom appeared first on ROI TV.

Mastering Roth IRA Rules and Retirement Tax Strategies

Joe Anderson — Sun, 01 Jun 2025 13:37:52 +0000

Planning for retirement involves more than just saving—it requires a detailed understanding of tax laws, account rules, and how to make the most of every dollar. In this week’s Your Money, Your Wealth discussion, Joe Anderson, Big Al Clopine, and Julie Anderson tackled a range of retirement planning questions, from early withdrawals to Roth conversions, diversification, and tax efficiency.

If you’ve ever wondered about Roth IRA withdrawal rules, the best way to manage stock holdings, or how to avoid costly tax missteps, this article is for you.

1. Funding Early Retirement Before Age 59½

Peter Lemon asked how to cover a few “gap years” before age 59½ without triggering penalties on retirement account withdrawals. He considered using Roth IRA contributions, which can be withdrawn tax- and penalty-free at any time. But he was unsure how that applied to dollars rolled over from a 401(k).

Julie clarified that even after a rollover, Roth contributions retain their original basis and are still eligible for penalty-free withdrawals. However, earnings on those contributions are subject to the five-year rule or age 59½, whichever comes later.

Joe and Big Al cautioned against tapping Roth IRAs too early, emphasizing that preserving tax-free compounding is often worth the wait. Alternatives like the IRS 72(t) election—which allows for penalty-free withdrawals if you take equal periodic payments for five years or until age 59½—were also discussed.

2. Paying Roth Conversion Taxes from Retirement Accounts: A Costly Move

One common mistake? Using retirement funds to pay the taxes on Roth conversions. Big Al illustrated this with a cautionary tale: a couple withdrew $500,000 to pay off a mortgage, leading to a $200,000 tax bill and additional stress.

Whenever possible, taxes on Roth conversions should be paid from non-retirement (non-qualified) assets. Otherwise, you risk reducing your long-term nest egg and missing out on future tax-free growth.

3. Backdoor Roth Contributions vs. Brokerage Accounts

David from Cincinnati asked whether to prioritize backdoor Roth contributions or build liquidity through a taxable brokerage account. With $630,000 in assets at age 30, he’s in a strong position either way.

Joe pushed for maximizing Roth contributions to take advantage of tax-free compounding. Big Al made a case for building up liquidity, especially with kids and potential home improvements on the horizon.

The takeaway? It depends on your goals. If you’re laser-focused on retirement, Roth wins. If you value flexibility, taxable accounts give you more freedom.

4. Consolidating Individual Stocks vs. Index Funds

Another listener asked whether they should roll 20 individual stock positions into an S&P 500 ETF. Big Al noted that an index fund offers broad diversification across 500 companies—compared to the limited scope of 20 individual stocks.

Joe added that selling stocks may trigger capital gains taxes, so investors should evaluate both the tax implications and their confidence in the individual holdings.

5. Understanding the Roth IRA Five-Year Rule

A common point of confusion: does the five-year rule apply to non-taxable Roth conversions, like those from after-tax 401(k) contributions?

Big Al confirmed it does. All Roth conversions—taxable or not—are subject to the five-year waiting period before the money can be withdrawn penalty-free. That’s in addition to the rules around age 59½ and original contribution tracking.

6. Home Office Deduction After the Tax Cuts and Jobs Act

Big Al clarified that the home office deduction is now only available to self-employed individuals. Employees can no longer claim it on their federal returns. However, some states still allow it—so it pays to check local tax laws.

7. Balancing Pretax and Roth 401(k) Contributions

A participant asked if contributing 15% pretax and 5% Roth is a smart strategy. Big Al said it depends on expected tax rates in retirement.

Pretax contributions lower your taxable income today but are taxed later. Roth contributions offer no upfront break but provide tax-free withdrawals. Balancing the two offers flexibility, especially if you’re unsure where future tax rates will land.

8. Can You Use Roth Dollars to Pay for Roth Conversion Taxes?

Michelle wondered if it’s okay to pay Roth conversion taxes using Roth IRA dollars. Joe and Big Al said it’s technically allowed—but not ideal.

Why? Because using Roth funds today means giving up future tax-free growth. If other non-qualified money is available, it should be used instead.

IMPORTANT DISCLOSURES:

• Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, LLC. A Registered Investment Advisor.

• Pure Financial Advisors, LLC. does not offer tax or legal advice. Consult with a tax advisor or attorney regarding specific situations.

• Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

• Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

• All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.

The post Mastering Roth IRA Rules and Retirement Tax Strategies appeared first on ROI TV.

Retirement Pop Quiz: 18 Questions to Get You Ready to Retire

Joe Anderson — Thu, 29 May 2025 11:07:08 +0000

Think you’re ready to retire? Joe Anderson and Big Al Clopine from Your Money, Your Wealth want to make sure you’re not just hoping you’re ready—they want to help you know. In this special episode, they lay out 18 essential questions designed to stress-test your retirement readiness. If you can confidently answer these, you’re likely in good shape. If not, it might be time to revisit your plan.

The Retirement Readiness Pop Quiz

1. What age do you plan to retire?

It sounds simple, but most people underestimate this. The average retirement age in the U.S. is 62, often not by choice.

2. How long will you live?

Consider current life expectancy: about 84 for men and 87 for women. A 65-year-old couple has a 50% chance one of them lives to 92.

3. How much annual income will you need?

Base it on lifestyle goals, not a vague percentage of pre-retirement income.

4. How much have you saved for retirement so far?

Roughly 46% of U.S. households have $0 saved. Where do you stand?

5. How much do you plan to spend annually in retirement?

Create a detailed budget, including discretionary and fixed expenses.

6. What are your sources of retirement income?

Include Social Security, pensions, rental income, annuities, and investment withdrawals.

7. When will you claim Social Security?

Claiming early at 62 reduces benefits permanently. Delaying increases them significantly.

8. What is your Social Security breakeven age?

This is the age when total lifetime benefits from claiming later surpass those from claiming early.

9. Are you coordinating benefits with your spouse?

Delaying the higher earner’s benefit can increase survivor income.

10. What is your retirement savings goal?

Fidelity suggests 10x your income by age 67. Is your number realistic?

11. What is your withdrawal strategy?

The 4% rule is a starting point. Will you withdraw the same amount each year, or adjust with the market?

12. What is your portfolio allocation?

Stocks vs. bonds? Domestic vs. international? Are you considering risk tolerance and time horizon?

13. Are you accounting for inflation?

With 3% inflation, $1 today will be worth $0.81 in 20 years.

14. Have you considered healthcare costs?

Fidelity estimates a 65-year-old couple may need $300,000 for out-of-pocket medical expenses.

15. Are you planning for long-term care?

Consider whether you want insurance or will self-insure. Long-term care can derail a retirement budget.

16. Have you created a tax plan?

Taxes can be your biggest expense in retirement. Are you strategically withdrawing from pre-tax and Roth accounts?

17. Are you prepared for required minimum distributions (RMDs)?

RMDs start at age 73 or 75, depending on your birth year, and apply to pre-tax accounts.

18. Do you have a written retirement plan?

Only 33% of workers do. A written plan increases confidence and retirement success.

Key Takeaways from Joe and Big Al

Start early and save consistently $750/month from age 30 or $1,530/month from age 40 can grow to $1 million by retirement.
Use Roth conversions while tax brackets remain low until 2026.
Don’t underestimate healthcare or inflation plan ahead.
Your investment vehicle matters less than your asset allocation.

IMPORTANT DISCLOSURES:

• Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, LLC. A Registered Investment Advisor.

• Pure Financial Advisors, LLC. does not offer tax or legal advice. Consult with a tax advisor or attorney regarding specific situations.

• Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

• Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

• All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.

The post Retirement Pop Quiz: 18 Questions to Get You Ready to Retire appeared first on ROI TV.

The Formula for Retirement

Joe Anderson — Tue, 27 May 2025 11:54:26 +0000

When it comes to retirement, there are few things more important than having a plan—and the earlier you start, the better. In a recent episode of Your Money, Your Wealth, financial pros we walked viewers through key retirement planning strategies, formulas, and tax moves to help secure long-term financial goals.

The Power of Compound Interest and the Rule of 72

We kicked things off by highlighting compound interest, famously referred to by Albert Einstein as the “eighth wonder of the world.” Unlike simple interest, compound interest grows your money exponentially over time by earning interest on both your initial investment and accumulated interest.

They broke down the Rule of 72, a simple formula to estimate how long it takes for an investment to double. Divide 72 by your expected rate of return: a 7% return means your money will double in about 10 years. But at 2%, it takes a staggering 36 years. Clearly, rate of return and time are your biggest allies.

Start Early, Save Consistently

To drive home the importance of starting early, they compared saving $100 a month beginning at age 25 versus age 35. That 10-year head start could result in an additional $100,000 or more in savings over a lifetime thanks to compounding. Even modest annual increases in savings can have a profound impact on retirement outcomes.

Calculating Retirement Spending and the Shortfall

Next, we explained how to calculate retirement needs. Start with your current expenses and adjust for 3% inflation. Subtract expected income like Social Security, then multiply the annual shortfall by 25 to find your target retirement savings. For example, someone expecting $144,000 in annual expenses with $55,000 from Social Security needs to fund an $89,000 shortfall. Multiply by 25, and you get a $2.2 million savings goal.

Understanding the “Retirement Smile”

Spending in retirement isn’t linear. I want to introduce you to the “retirement smile”: higher spending in early retirement (“go-go years”), a dip during the “slow-go” years, and a rise again due to healthcare costs in the “no-go years.” Many retirees spend more in retirement than they expected, making accurate planning crucial.

Applying the 4% Rule

The 4% rule remains a helpful benchmark. If you retire with $1 million, withdrawing $40,000 per year (4%) gives you a strong chance of not outliving your money, assuming a 6% return. However, the duo stressed that withdrawals should be adjusted dynamically based on market performance and personal needs.

When to Claim Social Security

Social Security claiming strategies also play a huge role. Claiming at age 62 could reduce benefits by 30%, while delaying until 70 can boost payments to 124% of your full retirement amount. We suggested evaluating factors like health, income needs, and whether you’re still working when making this decision.

Reevaluating the Rule of 100

The traditional Rule of 100, which suggests subtracting your age from 100 to determine stock allocation, was challenged. They argued that allocation should reflect individual risk tolerance, goals, and legacy plans. For example, a risk-tolerant investor may opt for more stock exposure, while others may want more cash for security.

Tax Planning and Roth IRA Conversions

One of the most actionable strategies they shared was Roth IRA conversions. With tax rates expected to rise in 2026, converting pre-tax retirement funds now could yield massive long-term savings. Converting in lower tax brackets (like 12% or 24%) today helps reduce your required minimum distributions (RMDs) and future tax bills.

Tax Allocation Across Account Types

Understanding how different accounts are taxed is another key strategy. Use tax-deferred accounts (like IRAs) strategically during low-income years, and prioritize Roth IRAs for tax-free growth. Taxable brokerage accounts provide flexibility but may generate capital gains.

Plan for Longevity

With life expectancy on the rise, couples have a 50% chance one partner will live to 92. We emphasized planning for a longer-than-expected life to avoid outliving your money, especially considering rising healthcare costs.

Use the Retirement Readiness Guide

Finally, the team encouraged everyone to download their Retirement Readiness Guide. It’s packed with practical tools to calculate savings targets, plan withdrawals, and optimize investments for a confident retirement.

Bottom line: Retirement success is about more than just saving—it’s about making smart decisions across the board. The earlier you start, the more prepared you’ll be to live your best retired life.

IMPORTANT DISCLOSURES:

• Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, LLC. A Registered Investment Advisor.

• Pure Financial Advisors, LLC. does not offer tax or legal advice. Consult with a tax advisor or attorney regarding specific situations.

• Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

• Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

• All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.

The post The Formula for Retirement appeared first on ROI TV.

Real-Life Strategies for Taxes, Withdrawals, and Wealth Building

Joe Anderson — Sun, 25 May 2025 14:06:51 +0000

Retirement planning is never one-size-fits-all—and for good reason. Whether you’re managing a multimillion-dollar portfolio or navigating a modest pension with rental income, success depends on strategy, timing, and tax-savvy moves. In this week’s episode, Joe Anderson and Big Al tackled seven real-life retirement scenarios that prove there’s more than one path to financial freedom.

1. Safe Withdrawal Rate Planning for a High-Net-Worth Couple

A couple aged 58 and 56, with $4.3 million in assets, plans to retire in 2025 and spend $165,000 annually—including $65,000 on discretionary items like vacations. Their portfolio includes $2.6 million in deferred accounts, $1.6 million in taxable investments, and $325,000 in rental property equity.

Joe and Big Al crunched the numbers: a safe withdrawal rate supports $175,000 annually for 35 years, and even $225,000 in the first decade. But market risk looms large. The couple is advised to:

Develop a diversified investment strategy
Incorporate Roth conversions early for tax control
Plan distributions to avoid spikes in ACA premiums

2. Using Roth Conversions After Moving to a Tax-Free State

James Bond—yes, really—asked if moving to a tax-free state like Texas or Nevada to do Roth conversions is legit. With $5.6 million in assets, he’d save serious money avoiding California’s income tax.

Big Al confirmed the move works—but only if it’s genuine. Change your driver’s license, voter registration, and spend at least 183 days there. Anything less could trigger an audit and retroactive tax bills.

3. Single Dad’s Retirement on a Lean Budget

A 54-year-old single father in San Francisco hopes to retire at 62. With $620,000 in investments, $3,000 in monthly rental income, and an $800 monthly parental pension, his goal of spending $72,000 annually is doable.

With smart investing, his portfolio could hit $1 million by 62. Adding in a $25,000 pension at 65 and $3,100 in monthly Social Security at 70, his strategy is conservative, flexible, and aligned with his lifestyle.

4. Stress-Free Career Planning at 45

Rob, 39, wants to scale back his high-stress job in six years, with an eye on early retirement in his 50s. His net worth is $1.8 million, and he saves $60,000 annually.

Big Al projected Rob could grow his portfolio to $2.3 million by 45 and $4.1 million by 55 at 6% returns. The advice? Keep saving, keep investing, and stay open to pivoting into lower-stress work when the time is right.

5. Managing Capital Gains on a Home Sale

A Fremont homeowner was concerned about exceeding the $500,000 capital gains exclusion. With a $300,000 purchase price and a $1.2 million sale value, taxes were inevitable.

After deductions, they face roughly $67,000 in federal and state taxes. Still, they walk away with massive equity and are reminded that the temporary spike in Medicare premiums is manageable given their financial windfall.

6. Pension vs. Lump Sum: What’s the Better Bet?

A 61-year-old with $3 million in liquid assets asked if he should take a $520,000 lump sum or a $38,000 per year pension.

Joe and Big Al found the pension’s net present value was comparable to the lump sum at common discount rates. The choice boils down to:

Take the pension to preserve liquid assets while waiting for Social Security
Take the lump sum if you want investment control or to leave a legacy

7. Real Estate Concentration vs. Retirement Account Diversification

Lloyd Christmas (no relation to Dumb & Dumber), a business owner with $7.3 million, prefers commercial real estate and isn’t a fan of retirement accounts.

While his strategy has worked so far, Joe and Big Al warned that market downturns could wipe out income. They advised:

Opening Roth accounts for long-term tax-free income
Creating a balanced mix of real estate and paper assets
Stress-testing his strategy against worst-case scenarios

Final Takeaway: Customize Everything

No two retirement plans are alike. Whether you’re managing $600,000 or $6 million, the key is thoughtful strategy. That means managing taxes proactively, preparing for market downturns, and being honest about your lifestyle needs. With the right plan—and the right team—you can design a retirement that fits your future, not just your finances.

IMPORTANT DISCLOSURES:

• Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, LLC. A Registered Investment Advisor.

• Pure Financial Advisors, LLC. does not offer tax or legal advice. Consult with a tax advisor or attorney regarding specific situations.

• Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

• Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

• All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.

The post Real-Life Strategies for Taxes, Withdrawals, and Wealth Building appeared first on ROI TV.

Avoid These Retirement Mistakes

Joe Anderson — Thu, 22 May 2025 11:33:07 +0000

Retirement Planning and Avoiding Sabotage

Joe Anderson and Al Calpine emphasized the importance of intentional retirement planning to avoid sabotaging decades of savings. They encouraged having realistic expectations about retirement, accounting for market fluctuations, and making informed decisions. They also raised awareness of elder fraud, citing 88,000 victims over age 60 who lost $3.1 billion in 2022—an 84% increase from the previous year. Planning for lifestyle and purpose, not just finances, is essential for a happy retirement. Despite 55% of people expecting to work past 65, only 19% actually do, showing the gap between expectations and reality.

Financial Missteps and Buyer’s Remorse

Common financial missteps include buying RVs, dream homes, or boats without thorough research, often leading to buyer’s remorse. Joe and Alan advised visiting destinations multiple times and in different seasons before making major purchases. They also warned about overestimating investment returns, underestimating inflation, and overlooking medical expenses, which can all disrupt retirement plans.

Inflation and Investment Strategies

Inflation erodes purchasing power over time—$100 in 2000 equals about $180 today. Coffee prices have risen from $0.25 in 1970 to over $3 today, illustrating the need for investment strategies that outpace inflation. Joe and Al recommend maintaining a diversified portfolio that includes equities to grow wealth over time. They discussed sequence-of-return risk, which occurs when retirees withdraw funds during market downturns, and encouraged mitigating this with a diversified and flexible withdrawal strategy.

Required Minimum Distributions (RMDs)

Understanding RMD rules is critical. Depending on birth year, RMDs start at age 72, 73, or 75. RMDs must be taken separately from each 401(k) but can be aggregated for IRAs. Mistakes can lead to double taxation or higher tax brackets. Early planning, especially for large account balances, allows retirees to explore tax-saving strategies like Roth conversions.

Social Security Claiming Strategies

Claiming Social Security too early can reduce benefits permanently. Waiting until full retirement age (typically 67) or age 70 increases monthly payouts. Attendees were advised to consider their health, assets, and spousal needs when deciding when to claim. The gap between retiring at 62 and qualifying for Medicare at 65 was highlighted, as private insurance costs during this period can be significant.

Long-Term Care and Medical Expenses

Long-term care is expensive, with nursing home rooms averaging $10,000 per month. In high-cost areas like California and New York, it’s even more. Joe and Alan recommended ensuring enough capital is available to cover such costs, even without long-term care insurance. Planning for the financial needs of a surviving spouse is also crucial.

Estate Planning

Estate planning is often neglected, with half of Americans dying without a will or trust. This can result in assets going through probate and distribution being determined by state law. Joe and Al advised creating key documents: wills, trusts, durable powers of attorney, and healthcare directives. Ensuring beneficiary forms are up to date is also vital.

Retirement Lifestyle and Communication

Retirement isn’t just about money—it’s about how you spend your time. Unrealistic expectations, like spending every moment with a spouse, can cause friction. Jim from Solana Beach shared that having too much unstructured time led to challenges in his marriage. Joe and Alan encouraged developing hobbies, volunteering, or part-time work and having open discussions with partners to align retirement expectations.

Legacy and Investment Decisions

Kristen from Tacoma asked whether retirees should exit the stock market once they have enough money. Joe and Al explained that the answer depends on whether assets are intended for personal use or as a legacy for heirs. If the goal is to grow a legacy, staying invested makes sense. If not, capital preservation may be more appropriate. They advised aligning investment strategies with long-term goals, risk tolerance, and retirement objectives.

IMPORTANT DISCLOSURES:

• Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, LLC. A Registered Investment Advisor.

• Pure Financial Advisors, LLC. does not offer tax or legal advice. Consult with a tax advisor or attorney regarding specific situations.

• Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

• Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

• All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.

The post Avoid These Retirement Mistakes appeared first on ROI TV.