12.17.22: Audio automatically transcribed by Sonix

12.17.22: this mp3 audio file was automatically transcribed by Sonix with the best speech-to-text algorithms. This transcript may contain errors.

Producer:
Any examples used are for illustrative purposes only and do not take into account your particular investment objectives, financial situation or needs, and may not be suitable for all investors. It is not intended to predict the performance of any specific investment and is not a solicitation or recommendation of any investment strategy.

Producer:
Welcome to Prosperity Principles with your host Ed Cruz. Each week, Ed and his company seek to educate Americans like you by providing real strategies for protecting and growing their hard-earned money. Get set for a full hour of financial information and economic news affecting your bottom line. Ed wants you to reach the financial freedom you've worked so hard for. So now let's start the show. Here's Ed Cruz.

Edwin Cruz:
Welcome back to Another Week of Prosperity Principles. I'm Edwin Cruz. And as we close out this year, we want to start you on the path to financial freedom in 2023 and beyond. So we have a lot to cover here today. And we want to welcome back our co-host, Matt McClure.

Producer:
Hey there, Ed, How's it going? I know you've been you have been busy. It's been a busy time of the year, but I hope you're doing well this week as we get ready for Christmas. Boy, I can't believe it's just a few days away.

Edwin Cruz:
It's unbelievable. You know, I say it to everyone I speak to at this point, it seems like I just said Happy New Year just a couple of months ago. And here we are going into another new year soon and the holidays are upon us. But business doesn't stop. This market has a lot of people scared. We keep seeing all the changes, another half percent rate hike. And so with just everything in flux, business is just not slowing down. And you know, there comes a time where for as busy as you are and you appreciate that you do sometimes want a little a little break here.

Producer:
Just a little bit of a breather. You know it's a round out the year and then hit the ground running again for the start of 2023, you know. But yeah, we've got a lot of great stuff on the show today for folks looking forward to 2023 and some great tips to.

Edwin Cruz:
Absolutely. You know, when when we think about coming into a new year, there's a lot of things that that we say we could have done, we should have done. But at some point you have to implement a plan. And that's what we're here to help people do.

Producer:
Absolutely. It's all about education. It's all about, you know, learning about the different options that you have for your finances, planning for your future, taking care of your finances, not only now, but in your future for your retirement years and all of that setting you up for success. And we really, really do appreciate you joining us here for this edition of Prosperity Principles. We're going to be around here for the next hour, and we're going to also be around on the website really is in perpetuity here. The website is MyProsperityTeam.com. You can go there, get past episodes of the show. You can subscribe to our podcast as well. Yeah, we're we're all over the place on the podcast apps any of them that you listen to and want to take part in subscribe to us we would really appreciate that. Just go there to, you know, Apple Podcasts or Spotify or whatever Search for Prosperity principles. The show will come up, you'll see the logo there. It looks like a tree and, you know, growing and prospering. And that will be there on the logo for the show. And subscribe to us.

Edwin Cruz:
And for our listeners out there, we want to remind them that we do have a book, The Annuity 360 book, and we want to get that in your hands. You know, if you didn't do it in 2022, now's your time to change things for 2023. Call us for that book. 386 228 5769.

Producer:
Yeah, it's a good one too. And it's not a tremendously long read at all, but it is jam packed with a lot of great information about annuities and how they can potentially help you for your retirement planning and provide you with an income in retirement and a good steady income in retirement as well. Ed, we've got, as we mentioned, a lot of great stuff coming up in the show today. We'll start out with our Quote of the week here in just a few. We do have some important updates for the end of this year for the end of 2022. So we'll go over those as well. We'll also talk about RMDs. That's something that comes up toward the end of the year, a topic that people think about right around this time. So we'll talk about them. They're required minimum distributions. What are they? How can you avoid them potentially? And we'll talk about it. A Roth conversion could become a secret weapon in your retirement plan. We'll talk about that as well. We'll also have a financial checklist to jumpstart your new year. And we'll talk about the inflation demonstration this week. I love it because it's based on the song The 12 Days of Christmas. And I think it's just kind of it's kind of a cute way to look at the inflation kind of situation that has been going on. But it's it's eye opening. At the same time, it's like we don't ever really get to have fun when we talk about inflation. So this is sort of a way to do it. So I.

Edwin Cruz:
Love that. I'll just say it's not such a fun topic when you're thinking of how much more it's costing you. But you're right. You've got to put a little shed, a little light. Do it right?

Producer:
Yeah. Laugh to keep from crying, you know. That's one of those kind of situations. And then if we get to it, because we've got so much going on this hour, how much Americans are spending on Christmas trees this year? That's a big one. And also, we'll look at this week in history. All right. That's what's coming up on the show. So stick around for all of that and even maybe a little bit more. But right now, we're going to start off with our Quote of the week.

Producer:
And now for some financial wisdom, it's time for the Quote of the Week.

Producer:
We'll add this week. Our words of wisdom come from Will Rogers, who, of course, is no longer with us. He actually died back in 1935. But, you know, right around the dawn of the entertainment age with radio and that being something in the early part of the 20th century that really made him very popular. He was an entertainer, a humorist. He was Oklahoma's favorite son. They say he traveled around the world three times. He made 71 films, wrote more than 4000 nationally syndicated newspaper columns. Boy, he was he accomplished a lot in his lifetime. So this is what Will Rogers said one time. He said, quote, The difference between death and taxes is death doesn't get worse every time Congress meets. I love that. Yeah.

Edwin Cruz:
And you think about that today. And for as much as I'm all for helping all around the world, you know, we look at all this all this money going out as I look at to all these countries and you know that that's going to lead to taxes eventually. It has to lead back to taxes because somebody's got to pay that bill as we hand this money around the world. So absolutely. You know, it does kind of make you cringe every time our our politicians get together.

Producer:
Yeah. You know, and it's not as you say, it's not like we want people who are different countries, who are our allies and things like that to be high and dry and just, you know, left, left in the lurch, so to speak. But it's you know, it's also a thing where you have to kind of think about what is the impact going to be on us here at home and and our pocketbooks and our wallets. And yeah, it is it's a concern for a lot of folks going forward. All right. So let's go on now to some important reminders, Ed, for the end of this year, we've got the Social Security cost of living adjustment that is going to go into effect at the beginning of 2023. Walk us through this, because this is a result of that inflation that we just love talking about so much.

Edwin Cruz:
Yeah, well, I mean, again, going back and saying there are some things that we can make light of and have fun. Well, this is a this is a good one, at least for for those recipients that are on fixed income. We we all know that the increase for Social Security, the cost of living adjustments going to be 8.7% this year. And if we follow up and tag on last year's 5.9% cost of living increase, that brings our two year total to 14.6%. And at least for everyone on fixed income, that's something that that everyone should or seniors are again, receiving. Social Security should be should be happy about because they've been squeezed. And and I talked to many people that have had to sacrifice in Converse to that. Then we're talking about taxes. Right. And there are new tax brackets coming up for 2023. There are some differences in some of the and some of the write offs that individual employed people will have. But if you take a look at the the brackets themselves, some of those some of those differences being where you would have where you would have fallen, let's say in the 12% tax bracket at a stage somewhere in the lower 80,000 range. Now you are in that at 89 for 50. So some differences here there talk, talk to your tax professional about that and that will apply for single filers and joint filers. There are going to be changes. So, you know, pay attention to those things. They will have an impact when it comes time to file. So again, here comes year end and that mad rush to your CPA is coming soon.

Producer:
Yeah. And you've got to be careful about it, too. If you are one of those who, as so many people have over the past couple of years, taken on those side hustles, you know, and you've got got a second job, you've got to make sure that you are taking out enough from your withholdings to cover that tax burden. If you have that second job that throws you into another tax bracket, just pay attention to that because, hey, I speak from experience on that. That one has come back to bite me in the you know, where a couple of years in my past. So so I do speak from experience on that one.

Edwin Cruz:
Ed you know, a lot of people, they take on these jobs and they really don't think about any additional tax exposure. You know, same thing goes for our retirees that want to make excess withdrawals to help their children or to do that extra trip or to buy that vehicle that they've always wanted. And the one thing that I constantly have to explain to them is it's going to put you in that next tax bracket. If you take X amount of dollars out, that makes them rethink their strategy. But there are strategies that help lessen that burden, taking the same amount of money out, but lessening that tax burden. We'll get into some of those possibilities here throughout the show. But I also have some additional ways of making that happen that are not listed here. But that's why you meet with with an advisor like myself. You want to know every angle that you can take, every possibility, anything that you can do to help yourself out. Whether it's through taxes or through the way that you invest. Again, it's not what you do at that moment of time. It's what you do throughout the years that has a compounding effect and lead to that one moment when you need to make that that right decision at that right time.

Producer:
Yeah, it's like we've talked about before on the show, you know, with like compounding interest, you know, it's like it all builds up over time and it can be a good thing if you're earning compounding interest. It could be a bad thing if you're having to pay it. But it's the same thing with like the effort that you put forth into planning for your retirement. Your situation can either get much better over the years or it can get much worse. That's that's a great, great point and a great way to look at it, I think. All right. Well, let's moving on here to our next topic of discussion, which is those RMDs, those pesky RMDs that people love so much, especially people who are, you know, turning 72. Let's talk about them. They're required minimum distributions. Tell the listeners if they might not have even, you know, had this across their mind. What are RMDs at and why should people be concerned about them?

Edwin Cruz:
Yeah, and quite concerned required minimum distributions obviously are distributions that the federal government mandates on you from your from your tax deferred accounts. When you were working you had a 401 K, if you're self employed you are building up in an IRA or a Sep IRA. If you're a nurse, somebody in the health care system may have a 401 aa403b and we could keep going down the list. But they're all qualified plans for most people. Those qualified plans are due on December 31st. If you are the age now 72 or older, people tend to get a little confused because it used to be 70 and one half and you have to kind of remind them it is now 72 and those distributions are taxable required minimum minimum distributions are for tax deferred accounts, like I said, and you don't pay your taxes until you remove that money. Anything that you've contributed to, anything that your employer has contributed into your plan, everything is pretax. So when you start taking those withdrawals, you have to you have to pay taxes on it. Unless your taxable income is at such a point where your CPA says you may not have to owe on taxes, but that's a rare instance. So again, when you turn 72, you have to start taking required minimum distributions every year and you can't skip the only exception where you might not have to take that required minimum distribution by the end of the year is when you turn 72.

Edwin Cruz:
You have until April 1st of the following year to take your required minimum distributions and pay taxes on it. The only problem with waiting if you do such a thing, is that in that given year you may have to take to required minimum distributions. So I advise against waiting on taking that first time required minimum distribution. You're just better off taking it the year before and getting it over with because if you double up on it, obviously that may throw you into another tax bracket. There's a lot of things that you have to keep in mind when making these decisions. Congress determined that it would give people that three month grace period, but it comes with consequences. As I always say, every decision we make has a consequence. So we have to be alert to what it is. And again, making two of those could could hurt you. You know, the one thing that we will always do is, is give you that advice on when you should take it, why you should take it. It's not just, you know, I just don't want to tell somebody to do it. I want to tell them to do it. And the purpose behind it, make sure that we're doing this in some sort of efficient way and required minimum distributions.

Edwin Cruz:
You know, a lot of people say, well, what is that, 3%, 4%, 5% of what I have? And it's not based on a percentage like that. It's actually a life expectancy table. There's a divisor factor. And again, it doesn't matter where you are in this process. If you want to know what that divisor factor is, we have the charts to show you what that is. You could also look it up on IRS.gov, but then getting down to it, if you don't take a distribution, what could happen? Well, first of all, the IRS is going to come in and say you now have a penalty of 50%. And I don't know anyone out there that would be happy to give away 50% of what that distribution was going to be to the IRS. In addition to that, not only is that quite a hefty penalty, you still have to pay taxes on not just the portion that they gave you, the additional that 50% or the other 50%, but the 50% you paid to the government, you still have to pay taxes on that as well. So talk about getting banged around. You know, the one thing that I would say is if you have multiple accounts out there, that when it comes to retirement accounts, you might want to think about consolidation, because the older we get, the more forgetful we get.

Edwin Cruz:
Right. And I've helped people get out of this situation. Case in point, had a nurse that we already had probably half a million sitting in in in accounts where we were managing the the RMDs, the required minimum distributions. But she forgot about her, her 403 B when she was a hospital administrator at another hospital. And two years into this she says, Ed, you know, I have this other account sitting over here. And I said, Och, I said, And you're taking your required minimum distributions, correct? And she says, No, I'm not. And so obviously that was not good. But we did write an extensive letter to the IRS. We had a CPA write everything out, what she would owe, what she should have taken, what she owes. We sent a check along with it and the IRS forgave the rest. Now, is that always going to happen? I doubt it, especially during these times. This was this was over ten years ago that I did this for someone. So, again, consolidation might be something that you're that you might want to consider. Don't miss out on taking your your required minimum distributions because it could be quite costly.

Producer:
Yeah definitely that 50% penalty as you say there, you know, the biggest penalty that the IRS doles out and they take it seriously. Uncle Sam wants his money, you know, but but there could be a way, I think, for a lot of folks here, Ed, to say goodbye to those RMDs and really kick the IRS out of your retirement plan altogether. I mean, you know, a lot of people say, well, I worked for 40 years or however long in my career, and, you know, now that I'm retired, why am I still paying income tax? You know, I don't have it's not like there's work that is going on. But there are actually some ways to reduce a large portion of that tax risk in retirement. And really these RMDs and any penalties that you might have to pay the taxes that you would have to pay on those RMDs That's all something that you can really get rid of If a particular strategy is right for you, that is.

Edwin Cruz:
Oh, absolutely. And it's funny you mentioned that there are people I run into that truly believe once they're taking out their required minimum distributions or reach full retirement age, that that they don't have to pay taxes. And I don't know where some people get their information from, but we all know that myths fly around. And but no, there's no there's no unicorn out there. No, no fairy dust out there that's going to get rid of the IRS from taking your from taking your distributions or or taxing you, I should say, on your distributions. They're going to come. But what can you do? And the one question that I that I do like to ask people is, do you think taxes are going up or down in the future? You know, think about where we are today. Again, going back to our our country's debt. You know, when I ask people and this is in other surveys, it's not just my questioning. We we talk about this all the time. Most people do believe that taxes are going up in the future. And, you know, at this point now, they're going to go up a tick. It's not that much at this point, but I do. You believe that there's a whole lot more coming in the future. So you might want to consider kicking the IRS out of out of being a partner in your retirement. And you know, what can you do? First of all, you can reduce future tax rate hikes by implementing a Roth conversion strategy. And, you know, you have to be careful there. You don't want to overcommit one year because that could put you in in a world of hurt when it comes to taxation.

Edwin Cruz:
So you do this systematically knowing where the limits are, where your income is, and where that next tax bracket is. Smart, smart retirees diversify their money into different tax buckets. And so would you be interested in generating tax free income during your 30 plus years of retirement? You know, people are living longer, so we have to consider that this is not a strategy that you're doing now and it's only going to affect you for the next five, ten, 15 years. It could literally affect you for 20, 25 years. And that's a lot to think about. So, you know, obviously in our industry, we have different ways that we look at things and, you know, we have proven legal strategies to help you do that. So we all know that the market is down this year. So now could be a very good time to do the conversions for for these IRAs. And so why would you continue to pay ordinary income taxes decades after you've stopped working? You know, now's the time to take advantage of doing Roth conversions. And even even more than that, you might want to set up and distribute that over ten years into a, let's say, life plan. And therefore you may get tax free income if if that's money that you don't need. This is a way to pass that money along completely tax free. So not just tax deferred to you as as you're as you're here, but truly tax free to the next generation, which is more than likely in a higher tax bracket than you are in retirement.

Producer:
Yeah. And folks, you can learn much more about that and get a free full retirement plan consultation. Go to MyProsperityTeam.com. It's MyProsperityTeam.com or call the number 386 228 5769. That number once again 386 228 5769. Well, as we mentioned at the top of the show here, Ed, we we can't believe it. I know I can't. I'm pretty sure you can't believe it. But at the end of the year is just about here and we're going to start 20, 23. But what we want to do, folks, is help you start it off the right way, get a jump start on your new year. And we've got a financial checklist here to go through, Ed, as we continue on. Number one is a biggie on this list, and it's pay off your credit card balances. I mean, this is one of the things that I, you know, had in my mind earlier when we were talking about or I just mentioned it briefly, really compounding interest, because that I think credit cards are kind of the biggest or one of the biggest sources of that compounding interest that just really snowballs.

Edwin Cruz:
Yeah, with rates going up, the national Fed rates going up, you know that extra half a point, you know, all that is is costing you in some way. And you know, credit cards now have annual percentage rates of over 20%, some of them well into the high twenties and even low thirties. And so that's not where you want to be. You know, you want to you want to minimize all that debt and, you know, start with the highest interest rates and try to pay those off. And if you've ever listened to Dave Ramsey, you know, I don't agree with everything he says. But when it comes to getting out of debt, I definitely agree. Look at that credit card with the smallest balance. Get that thing paid off and work your way up. You know, every time you pay one off, it's a victory. It's a win. And, you know, in life, if we don't feel like we're winning, we we tend to give up. And so let's go ahead and put our minds to it and and start and start getting some wins so that we can keep moving on. And so, you know, again, getting rid of that debt is going to free up so much money that before you know it, you know, they'll be you'll have that extra money for that extra investment, you know, for your future. And so, you know, that's the ultimate goal. And, you know, but let's sit down, let's talk about it and let's put a good plan together.

Producer:
Yeah. And it's like you're giving yourself a raise. You know, when you do something like that, you're you're paying yourself once you get rid of that debt and then you got more money to then pay yourself for your future. And so that's always a good place to be. All right. So that's paying off your credit card balances. The next thing on the checklist here, folks, is to maximize your tax bracket with a Roth conversion. We just we just talked about Roth conversions and how they can be beneficial as far as getting rid of your RMDs. And so here we go again, this bears repeating because it's important.

Edwin Cruz:
It does. There are no required minimum distributions on Roth IRAs. And, you know, while you're working now, you can start taking advantage of making some some smaller conversions and putting yourself in a better position because, you know, when once you convert to a Roth, you've already paid the taxes. So Uncle Sam has already received his cut. So as this money grows now over the next five, ten, 15, 20 years, all of that growth and your principal, it's all tax free. So, you know, there's a there's another good, good way of looking at this. If you were to pre-deceased you leave that money to your spouse or to your children, you're leaving that tax free. And what what better way of taking care of your family than to go ahead and get a jump on this and start preparing for yourself. And if it's not for you, preparing for the ones that you love, and if you truly love them, you will do this. You'll want to complete your Roth conversions before you start taking required minimum distributions. That's for multiple reasons. But when when when required minimum distributions kick in, you just don't want to have that burden of being in that next tax bracket. You just want to minimize some things. You want to simplify it before you get there. So like I said, even before you before you get to that age of of taking those required minimum distributions before you retire, you know, if you're if you're already in your fifties, you can start thinking about these these conversions already, or at least in your early sixties, get that get that plan implemented. But but do this. It's going to be a huge burden lifted off of you when you when you start taking those required minimum distributions with a much smaller amount, it will be quite helpful when you're on that fixed income.

Producer:
Yeah, definitely so. Well so number three on our list here at is to set a monthly budget for your retirement. And I think a lot of people might be might hear that and think, oh gosh, a budget, it's overwhelming. I've got to get out the spreadsheets and the, you know, all this stuff. I got to practice my long division and my calculus and everything. It doesn't have to be that hard, though.

Edwin Cruz:
Yeah. Pull out your grandkids geometry book or something. Right. And. And get to work. But no, listen, you know how much income is required to meet your needs and wants in retirement? You know, most people don't want a lifestyle change during retirement. And if that's you, then we need to plan for inflation and future tax increases. You need to start thinking of these things, you know, while you're working. You have certain expenses. You know, when you're retired, you just you put that put that together, see what you need, see what you're spending. Now look at those differences and then have someone that can give you an honest idea on what that future income is going to look like so that, you know, whether you have an income surplus or whether you have an income gap.

Producer:
Yeah, absolutely. So important to know that and really be prepared for it and plan for it in the future. Well, all right. So the next item on our financial checklist for the new year is to develop a plan to pay off your house. And this one can be a biggie, too. And it might sound another one like like it's a little bit overwhelming or impossible to people to get rid of that mortgage entirely. But boy, can it be beneficial.

Edwin Cruz:
Absolutely. You know, the way I look at it is once you hit the age of 50, whatever raises you receive from here on out. If you still have a mortgage that should be going towards that mortgage, you shouldn't think of any other thing that that that you can do with that money except pay off that property. And if you don't do it when you turn 50, you don't pick a number. If you say, well, I plan on retiring at 67 full retirement age. Right. Well, then start ten years before that. And every raise that you get, commit the rest of that salary or wage, whatever you want to call it, commit that to your mortgage and you will realize that dream of having that mortgage paid off when when you reach retirement and. Again, it starts off. Pay off all those other revolving debts and then take that take that excess. Put all that effort into that mortgage and you will succeed.

Producer:
Yeah. And that, again, is like a giving yourself a raise kind of a situation because, you know, it's it's just money back in your pocket. And I was going to look up here just really quick. The average mortgage payment in the US, the average mortgage payment, about $100, they say, as of earlier this year. So, you know, could you use and, you know, obviously if you have a larger house or a bigger loan, depending on on where you live and all of that, if you've recently gotten a mortgage, you're probably paying a lot more because of the way that the real estate market had been anyway for the past couple of years. But like, say, it's $1,500. Could you use an extra $500 in your pocket each and every month in retirement? I would say, yeah, that would be a good thing for for pretty much anybody. I can't think of a situation where no, we'll just keep throwing that $500 a month at the at the mortgage lender and keep it out of my pocket, you know.

Edwin Cruz:
And trust me, it's another big win. And you just want those wins. It just pumps you up and it keeps you motivated in life.

Producer:
Yeah, absolutely does. Well, our next item on the checklist for New Year's finances is to maximize your Social Security income benefit. This is another biggie here, and I think some people might not even think that this is a thing that they can do. But speaking of like giving yourself more money, this is something that you have control of. And I always say, you know, control the things that you can control and don't necessarily worry yourself to death over the things that you can't. Right. But control the things that you can. And this is one of those.

Edwin Cruz:
Absolutely. And, you know, I think a lot of people know this by now. There's a lot of advisors that speak to this. But it's worth it's a great reminder. Did you know that you can increase your benefit, your Social Security benefit, by 8% each year, that you defer all the way up to the age of 70? And, you know, people say, oh, should I take it now? Should I take it later? Well, you know, I take a look at family history, how long their family has lived. I take that into consideration. But if you're still working, why take that Social Security early? It's going to get taxed on top of that anyway. Might as well just put it off. Let it continue to grow. It'll be to your benefit. And when you retire, you'll have a whole lot more that you can spend later on in retirement. And that's the goal. The key is to try to have as much income as possible in retirement. And if you start taking it early, you're only hurting yourself. You know, you're you're not hurting the government. Trust me. They pay out less. They're happier for that. So, yeah, it's a smart idea to to let it go to its full term. And that is definitely my goal in retirement. So again, we could talk about multiple factors, but but for most people, there's no reason to take it prior to at least prior to full retirement.

Producer:
Yeah. And if you would like to find out, folks, if you might have that as a strategy for yourself in retirement and give yourself that 8% raise for each and every year that you do defer taking your Social Security income benefit. You can go to MyProsperityTeam.com or call 386 228 5769 And you can talk with Edwin Cruz completely free of charge. Get a full consultation there and we'll talk more about that in a moment. But now we're continuing our checklist to sort of jumpstart your finances for 2023 and the next item, implement a bond replacement to delete fees. Just get rid of those fees and stop the bleeding in your safe money. I think a lot of people have realized and I use air quotes for the safe money part there, Ed, because, you know, people don't really consider bond to be their safe money anymore the way that the bond market has been here recently.

Edwin Cruz:
Absolutely not. And just two days ago, I sat down with someone. We went over the portfolio, and the first thing she brought up to me is, you see these fees that I'm paying? Do you charge those fees? And we obviously showed her not only do we not charge those fees, we actually have indexes or indices, depending on how you say it, that are fee free. And it just it put a smile on her face. I mean, it was such a simple conversation, but it was a question that was at that top. She didn't worry about the 25% that she lost because we looked at the statement and it says how much she's lost by dollar amount and percentage. She was really concentrating on those fees. And so when you consider alternative fixed income options that can provide you with a guaranteed income for life and zero fees, yes, that's an option. It's a big win. And again, it was the motivator for her. She wanted to know that she would eliminate these fees throughout retirement forever more. She didn't want to have to worry about that. I said, well, you know, to me, let's look at safety of your principal and everything that you earn. We want to make sure we keep all that safe. But I can understand, you know, I said fees will definitely put a dent in your portfolio. But obviously, right now, the the biggest thing putting a dent in your portfolio is this market fluctuation. But it's funny that we're talking about this because I just experienced it.

Producer:
Yeah, I have this feeling like if, you know, you had said, well, yes, we charge those fees, she would have gotten up and walked out at that very moment. It's a huge thing for her, evidently for and for a lot of people, too, who want to be paying unnecessary fees, right?

Edwin Cruz:
Absolutely not.

Producer:
Yeah, that's definitely, definitely true. Well, the most important thing, though, that we want to get across here to folks at is to schedule a retirement consultation because we say this all the time and I am a big believer in it that it's not a one size fits all thing. There is no one retirement plan or retirement strategy that's just right for everybody. So it's important that you get your particular situation looked at. And I would say that you should give Edwin Cruz a call and or go to the website MyProsperityTeam.com. So when they do that, Ed, what happens? Tell us about the free consultation and all of the things that you can help folks with.

Edwin Cruz:
Well, I mean, obviously, you know, just like this. Client asked me about fees and I would I was going to cover that subject, but she beat me to the punch. But we want to cover how how you can reduce risk fees, how we help you in situations where you may have a brokerage account and every year you're getting a 1099 for that or money at the bank that you're getting a 1099. Let us show you how you can defer those taxes or completely eliminate paying taxes forever. More on on that sum of money. Let us help you figure out if you have the best strategies under under the sun. Let us help you with Social Security maximization. Let us show you how to close the income gap that you may have. People think, Well, I have plenty of money here, and what I'm not making, I got I got $200,000 sitting in the bank and I just draw down from that. And, you know, let me show you how not only you could how you can preserve that $200,000, but actually receive more, more interest than the income that you're going to take. In some cases, some of these people are just taking two, 3%. And I mean, honestly, throughout the years, two, 3%, two or 3%, we can we can pretty much cover that with our eyes closed. So let us show you how to preserve your assets in all ways, not just from the market, but sometimes from yourself. You know, let's just show you every way that we can help you. And it's complimentary, not an arm twister. You have nothing to lose. And, you know, over the past couple of weeks, I've been from Saint Lucie all the way up to Ocala. So, I mean, I've been talking about being all over central Florida. I've been there. But if that's a service that you need more than happy to sit down with you and show you how you can better your future.

Producer:
Yeah, definitely a priority for I think a lot of folks these days. And if it is a priority for you, then you need to be reaching out to Edwin Cruz. Go to my prosperity team. That is MyProsperityTeam.com or you can call 386 228 5769. Once again that number 386 228 5769. And as Ed just said, it's completely free of any charge in any obligation. So get that free consultation today.

Producer:
Want to know where your hard earned money is going. It's time for an inflation demonstration.

Producer:
All right. Well, as we are getting ready for Christmas, which is, as I said at the top, just a couple of days away, really. We're going to look at the 12 days of Christmas here and as part of our inflation demonstration today. And yes, I did say that those two things go together, the 12 days of Christmas and the inflation demonstration, and here is how they go together. All right. Actually, PNC Bank that you may have heard of, I know they're down in Florida because I used to I used to live down in Florida, actually not far from Port Saint Lucie, which is funny that you just mentioned. You just mentioned that. But I know they got PNC is down there. So the PNC Christmas price Index is something that they come out with every year. Now. It's an annual tradition showing the current cost for one set of each of the gifts given in the song The 12 Days of Christmas. Right. It's kind of like the consumer Price index a bit. It measures the changing prices of goods and services like housing, food, clothing, transportation and more that reflect the spending habits of the average American. So I want to take a look at some of these here. And it's it's a fun way to kind of take a look at it all, even though, as we said, you get a laugh to keep from crying sometimes.

Producer:
So, for example, if you know, if you remember the song, what's the first item? A partridge in a pear tree, right? Well, that's right. This year, a partridge in a pear tree. It will cost you $280.18. That's up 25.8%. So compared to just last year, which is kind of great to turtle doves, even more expensive. 600 bucks for a couple of turtle doves and to take care of them because they take into account the cost of feed and all of that. So the rising cost of feed is really why you'll be paying a third more. Yeah, more than 33% more for two turtle doves this year. You also have, let's see, five gold rings up 39%. Six geese are laying up 9%. Seven swans are swimming. They didn't go up at all, but they still have a big price tag, more than 13,000. So, yeah, I can just keep your swans and let them let them swim at your place. And so the true cost of Christmas in song, they say, is 197,009 cents, and that's up 9.8% year over year. Boy, that's some that that is something.

Edwin Cruz:
You know I'll take those dollars and well I could buy a second home somewhere or buy that fancy sports car or. Yeah, I'd rather spend it in other ways.

Producer:
Yeah. Rather than, you know, pipers playing and selling and all that stuff, you know. Yeah, that's good to sing about this time of year, but that's a lot of money that you can keep for yourself. And speaking of money, going out the door is also, as part of our inflation demonstration this week. Boy, the cost of Christmas trees have gone up as well. And I can imagine what the because I know that there's PNC Bank in Florida. I don't remember seeing pine trees in central or southern Florida when I was down there living.

Edwin Cruz:
Well, some way somehow they get shipped down here. So we see plenty of them out there. People are buying real trees, but 33.6% of American households will buy real or fake Christmas trees. Collectively. That's $4.19 billion. That's where a be that's a big number, an average of $85.59 per real tree and $122.60 per artificial tree. And I got to tell you, I just went on on a little Christmas tour throughout our town. They have this little train. It's called The Butler Express. It's really cool, actually. But you go out there and you see some of these homes and and trust me when I tell you, some of these trees are 14, 16 feet tall. Those didn't just cost $122.60. There are some there are some big time people out there that are spending some big bucks on these big trees. So more power to them. But I'll keep my I think I have about a nine foot tree. It's good enough for me.

Producer:
Yeah. Boy, we had some friends a few years ago. They have since moved away in Atlanta, as you know. And our friends moved from Atlanta out to the Dallas Fort Worth area a few years back now. But one of my favorite things to do during the holiday season was they would always have a gathering at their house and they had Christmas trees everywhere in their house. I mean, it must have been at least a dozen Christmas trees. I believe they were all artificial, but it was cool because they would have like one with Star Wars decorations. That was always my favorite because the top are on. It was like the Death Star. I thought that was just the coolest thing. And then, you know, they have different themes for every tree. And yeah, I mean, they spent a. A pretty penny on those, but at least those were artificial. So you didn't have to buy new ones each year. It was a one time investment, and that lasted you for quite a while. So that's that was the advantage there.

Edwin Cruz:
Well, they sound like fun, creative people. And that makes for a good time during the holidays.

Producer:
Absolutely does. Well, let's talk about a little bit here as we switch gears and get into, oh, about 12 minutes or so left in our show. The clock on the wall tells me talk about once again the bonds that might be in people's portfolio, because we've talked about safety a lot and we do that each and every week because people are so longing for some safety for their investments. Right. They see all the volatility in the markets. They see the the upheaval on on Wall Street. They see what's going on with cryptocurrency. We talked about that not long ago with that the whole FTX debacle and just cryptocurrency taking a dive. That's a volatile thing anyway, right? So people want some safety, especially now. So talk about bonds and why they might not necessarily be that safe investment that that people have over the years historically thought of them as.

Edwin Cruz:
Right and you know, and and I'll say this, you know, some people tell me, no, I don't have bonds sitting in my portfolio. And sometimes you have to look at some of these mutual funds that you have. They're loaded with bonds inside of them. So when you think about bonds, let's not just look at it in one fashion, right. Listed as a bond or separate it in a category in your statements under bonds, learn know what's inside of your mutual funds, know what percentage of bonds are inside of those mutual funds. So again, it goes back to that. If I were to sit there and ask you, do you know what percentage of your portfolio is in bonds, do you really know? Have you really studied your mutual funds to know? We found out that too many people don't know what percentage of their portfolio is in bonds and they don't know what bonds they currently hold. And there are mutual funds that are just all bonds. So you really have to know what you're looking for, looking at. And if you don't know, you can go online and search for a prospectus. Yes. And look at that prospectus and look at what the what the holdings are inside of that mutual fund. And you will figure that out. You don't have to read that 100 page prospectus, but you can find that certain page that tells you the percentage of what's inside of that mutual fund. So hopefully that's a good tip. I think that alone is is worth a lot. That tip alone is is invaluable to you. Do you know that 2022 was the worst year in history for Bonds, according to The New York Times. And every time there's that interest rate hike, it's going to keep hurting that last series of bonds.

Edwin Cruz:
You think about it when those when the interest rates first went up at the beginning of the year, that hurt all the old bonds. But think about this. We've had seven increases this year. And so those bonds that that received the increases at the beginning of the year, they have already suffered because the new rates today. So just when you think things are getting better they're not know they just continue to to snowball and we don't want that. You know bonds can take up up to 40% or more of your portfolio for many retirees and pre retirees. And you know, we've talked about the different rules that are out there, right? The rule of 100, rule of 72, the 4% rule. We talk about all these things. And of course, when we think about that rule of 100, if if it's an advisor out there and he has you 8020 or at least it looks like that on paper, there might be an extra ten, 20, 30% hidden inside of mutual funds that you have to that you have to dig into and figure out if you don't know how to look. These things up, you know, contact somebody that does but get the information. As we say, don't stick your head in the sand. That's not going to help anyone. So, you know, please get in touch and talk to us about bond replacement. This is where we use fixed index annuities to help that situation. Let's eliminate the risk, let's eliminate the fees. Let's guarantee you the additional income. Let's guarantee you that every time your asset grows that it never has a chance to go backwards again. So again, just let us help you in every way, shape and form when it comes to this type of investing.

Producer:
Yeah. And you can reach out at MyProsperityTeam.com or you can go to 386 or call rather 386 228 5769. Reach out to Edwin Cruz today it's this week in history. So some big and important things happened as we take a look back at the past week or so here in our history. And the first one, that boy, this was this was a big a big date for a big guy. Yes. It was known as the refrigerator. Tell tell us about William Perry here.

Edwin Cruz:
Oh, man. I remember watching him. I don't know if you've spent much time watching him or you can look back on it. But back in 1962, the American football defensive tackle William Perry was born, nicknamed, as you said, the refrigerator. Because of his imposing size, Perry stood at 6 to £335. And if you were a running back, you did not run through that lane. It was closed it and so you didn't even go there. Perry went on to win Super Bowl 20 as a member of the 85 Chicago Bears and recorded 29 and one half sacks in his career. And I can tell you, I remember these guys that would think that they were going to I'm going to stick it to them. I'm going to run through there. And he just stuck out his hand and he would just clothesline you. That guy was crazy good. So yeah, that brings back, as you can tell, I'm smiling here. So it brings back good memories watching that big dude.

Producer:
Yeah. Boy, you don't want to see him coming toward you, that's for sure. Yeah. My goodness. Well, there we go.

Edwin Cruz:
Big.

Producer:
Yeah, right, right, right. That's the thing. As I say, he was not a wide receiver, let's put it that way. It's just pretty much a no brainer. Well, so on December 17th, so just a few days back here on that date, back in 1903, the first ever airplane took flight. And this one was one that happened at Kitty Hawk, North Carolina. Right. Orville and Wilbur Wright, where the pilots behind that first successful flight in history, Orville, actually piloted the gasoline powered, propeller driven biplane. It stayed afloat or aloft or afloat, whichever way you want to call it, for 12 seconds and covered 120 feet on its first flight there. You know, I would like to go farther than 120 feet when I get into a plane. But a lot of times now, the way that that airlines have been and I wish that a flight would take 12 seconds to get from point A to point B.

Edwin Cruz:
Yeah. You know, as kids, we have these wild imaginations. I know I've dreamed plenty of times I was flying out there. Right. So to see something like this, imagine being the first one to witness something going up like that and staying afloat. It was a heck of an accomplishment.

Producer:
Yeah, definitely So very historic. Now, Ed, I don't know if you're a big fan of this particular program or not, but it's been around for a long time, actually since 1989, December 17th, 1989, The Simpsons made its television debut, and since then it has aired 738 new episodes. I mean, that's a lot.

Edwin Cruz:
It was out there for a long time. Did I peek at it once in a blue moon? I did, but it was more my son watching The Simpsons. But, you know, I. You know, the way that they told their jokes and all that. Sometimes I was a little like, Yeah, I don't want my kid watching too much of this either, you know? I was a little squeamish about it, but, you know, just just trying to grow them up to be good citizens. But I know that they had their their time, long time. They were very popular. They sold a lot of Simpsons dolls and stores and everything else. So very popular, I understand. But now was it much of my thing? But it be get it once in a while?

Producer:
Yeah. Yeah. I was kind of the same way. I sort of liked some of the parodies of that of stuff that they did. Like one time there was a parody of Willy Wonka and the Chocolate Factory, except it was Homer going to where? To the brewery where they made the the beer. You know, it was just that was just really funny kind of the way they wove that together. But yeah, it was it was a fun show, one that I ever really got into. Well, but how about this ad? Are you a fan of How The Grinch Stole Christmas?

Edwin Cruz:
Now, that's that's funny. And it makes me laugh because I have a good buddy I grew up with and he likes to dress as the Grinch. And here this year, he went out to a he was at a 76 ers, Philadelphia, 76 ers basketball game, and he wore his costume and they actually had him up on the Jumbotron.

Producer:
I love that.

Edwin Cruz:
So so he actually and then, of course, his wife is recording all this stuff. So crazy, dude. Dr. Michael Sarnoff hat goes out to you. He pulled it off and that's great. But yeah, no, it's. That was. That was. How should I say? It's historic. It's a classic. I definitely enjoy the The Grinch and the Dr. Seuss series there.

Producer:
Yeah, definitely. And it made its television debut on December 18, 1966. The original animated How the Grinch Stole Christmas. And then there was another movie version, full length film version back in 2000 with Jim Carrey as the Grinch. I actually love that version, too, but I have to say that original animated one is always, always going to be my favorite.

Edwin Cruz:
Jim Carrey is quite the character.

Producer:
He really, really is. All right. Well, we're just coming to the end of the show here. It has once again flown by. A lot of great info, a lot of wonderful advice for the listeners out there. Now we're coming up on Christmas here. I wanted to take this opportunity to, of course, wish all of our listeners a very merry Christmas and just all of the best and to to everyone and your families also, and likewise to you. And I know that you and your family will have a great holiday. I really hope that and and wish that for you. And we'll talk again once, once again after the holiday has come and gone, I guess.

Edwin Cruz:
Absolutely. Merry Christmas to you, Matt, and our listeners. And have a good one.

Producer:
Thanks for listening to Prosperity Principles. You deserve to work with a financial and insurance expert who can offer strategies for protecting and growing your hard-earned money. To schedule your free no obligation consultation. Visit MyProsperityTeam.com or pick up the phone and call 386 228 5769. That's 386 228 5769.

Producer:
Not affiliated with the United States government. Edwin Cruz does not offer tax, legal or investment advice. Consult with your tax advisor or attorney regarding specific situations. Opinions expressed are subject to change without notice. These opinions are not intended as investment advice, nor do they predict future performance of any product. All information provided is believed to be from reliable sources. However, we make no representation or warranty as to the accuracy of any statement. This information is intended to be educational in nature and does not provide a guarantee or a specific result. All copyrights and trademarks are the property of their respective owners. AmeriLife assumes no responsibility or liability for the content of this message. The information contained herein is provided on an as-is basis with no guarantees of completeness, accuracy, usefulness, timeliness, or of the results obtained from the use of this information.

Producer:
As the song says.It's the most wonderful time.

Producer:
But don't let holiday spending wreck your retirement plan. I'm Matt McClure with the Retirement Radio Network. Powered by Amerilife. Just over $832. That's how much the National Retail Federation says the average American plans to spend on holiday gifts, food and decorations this year. Many of us will spend much more than that. So how do you keep from overdoing it? Financial website Investopedia has some tips on keeping holiday spending under control. Number one is perhaps the most important set spending limits for yourself. Tyler Ferguson with Jax Federal Credit Union agrees.

Tyler Ferguson:
Some can even go old school like myself and use a cash spending plan to ensure that you're staying inside of your budget. You're actually using cash to mitigate those swiping of the cards. It's also an effective plan if you have kids wanting to shop as well.

Producer:
That from News4Jax. The number two tip from Investopedia is to make your own naughty or nice list. In other words, if you're shopping list includes more than five people outside your immediate family, start cutting it. Then bake cookies or other treats to give to those who didn't make the cut. That way you spread holiday cheer without breaking the budget and you don't seem like Scrooge. Humbug. Other bits of advice from Investopedia include being realistic about your budget. Collecting coupons or discount codes and organizing group volunteering instead of holiday parties. Ferguson says one thing you should not overlook is getting the kids involved.

Tyler Ferguson:
For the younger kids, you want to give them a smaller dollar amount, maybe a $10 cash transaction to kind of help provide them visual observation of what they're using the funds for. And then for your older kids who have either been saving themselves already or they have a lump sum to kind of go shopping with can open up an account for them. Go over how to budget and how to spend.

Producer:
So how can you give this holiday season without busting your budget? That's a key question to consider. As Santa starts warming up the sleigh with a Retirement dot Radio Network Powered by AmeriLife. I'm Matt McClure.

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