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1.6.22: 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, Edwin Cruz. And here we are in 2023. Just one final. Happy New Year to everyone and I won't go through that again. But, you know, we're going to we're going to be discussing a lot of topics here today. And and but before we get to that, I want to welcome in our audience always listening to us. And I really appreciate the calls that I get. And from my clients letting me know that they've listened to me. And and for the new callers out there that don't know me, I've been in in the business for 24 years of of helping people get past the challenges of finances. And you know, when we sit here and we think about this, here we are in a new year and people make resolutions, people want to make changes, but sometimes they just don't know how they want to make these changes. And, you know, for those that are looking for a little more insight, when you call us at 386 228 5769. There is a book, The Annuity 360 book that we do offer that will help you get a head start on our knowledge here. And we want to help you achieve your goals. And you know, why is it that people call me? People do call me because for one, they're looking for safety. We know what happened here in 2022, and I know that we're going to have part of our segment dive into that. The other big reason is people are looking for income.

Edwin Cruz:
You know, what's the number one fear that people have that's running out of money? You know, once you do that, you've exhausted your your income sources. Now what you know, you could literally be in your eighties, even in your nineties and not know which way to turn. So we have guaranteed solutions to help you there. We have small business people that call us for for tax deferral. They're looking for ways to minimize their tax exposure so we can help you there all while maintaining some sort of liquidity and making sure that you avoid probate. So these are just a handful of reasons that people call us. And, you know, there's a lot of bad, bad information out there. There's a lot of bad product out there. And you want to make sure that you make the right decisions. And so when people ask me, you know, what type of what type of information can you give me that's different from the rest? Well, the one thing that I like to do is show you, for one who who earned the product of the year. I think that's a good start. Or what indices worked for the year, right? What indexes worked for the year? You want to know these things because you know, you want to know that that person is actually out there tracking these things for you. So anyway, there's a lot that we're going to talk about. And with all that said, I want to welcome in my co host, Mat McClure. Welcome.

Producer:
Mat Hi there. Ed Yeah, great, great way to start the year there by just reflecting on 2022, which we'll do, we'll kind of do this, this roundup of it today in the show. And I think that's going to be a useful exercise for people just to put things in perspective, but then also to look ahead. And I think you said it right. I mean, people are looking for safety. They're looking for income in their retirement. And I think those are a couple of things that you can especially help them out with.

Edwin Cruz:
Well, that's our that's our specialty, right? 24 years and we'll keep it going.

Producer:
That's right. That's right. And that is the goal. And of course, the goal of the show here is education. You know, telling folks what are some of these things that you can do, educating the listeners about so many different things. And we're going to cover, as you said, a lot of ground today. You mentioned the phone number. I'll mention it one more time is 386 228 5769. That is to give Edwin Cruz a call and talk to him about anything dealing with your money problems or challenges that you might be having at this time. You know, whether you're looking forward to retirement or you just want to get a grip on your financial situation, you can also go to MyProsperityTeam.com. That's the website for the show. Once again,You can find prosperity principles anywhere you listen to podcasts as well. We'd love it if you would subscribe and if you would just give us a shout out there and leave us a rating, we would absolutely love it. Well, as we said, a lot coming up here on the show today. We've got some big takeaways from 2022, all that fun stuff. But you know that you kind of alluded to there the down markets, the inflation, the food, the energy costs, interest. Rates, all of that. But amongst all the bad news, we're going to find some good news as well. And that might be some some opportunities here for folks. So we've got that. We've got a segment called Beating the Bank CD's, plus the most important change to make in your plan In 2023, we'll do a little inflation demonstration. And we've also got some good stuff in this week in history. So all that coming up on this show today for this week. But first, let's get things cookin here with our quote of the week.

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

Producer:
And I said, quote of the week, It's actually quotes of the week. This time around. We got we got another two for one special, a buy one get one here on the on our quotes of the week. And you didn't even have to pay for the first one. So there you go, folks. It's just they're both a treat for you. The first one comes from Robert G. Allen, who is an influential investment advisor, author. He's got several best selling personal finance books out there. And his quote that we're going to share this week is how many millionaires do you know who have become wealthy by investing in savings accounts? I rest my case. You can imagine when he posed that question, he heard a lot of crickets.

Edwin Cruz:
Absolutely. You know, the title of the show today, right, is How to Start 2023 on the Right Foot. And one thing's for sure, leaving your money just sitting around inside of savings accounts or any type of passbook account or money market account, it's really not going to fulfill your financial goals. So you definitely want to sit down with someone and and at least get some ideas on what you can do to better yourself. And now's the time. It's early in the year. Get started on the right foot.

Producer:
Yeah, that's right. And that's absolutely one way to do it. And well, of course, during the show today, go through many, many more. And so our second quote of the week comes from someone from the sports world who, you know, have heard of everybody listening. Venus Williams, an American professional tennis player, of course, former number one in the world in both singles and doubles and, of course, sister to Serena Williams as well. She said this, quote, I don't focus on what I'm up against. I focus on my goals and try to ignore the rest. I love.

Edwin Cruz:
That. Yeah, there's a reason that they put horse blinders on horses, right? They want to get them to the finish line. And so if you're a little squirrely and your focus is everywhere else, you're going to miss the goal. And that's why when we give you the information, we don't just want to tell you. We want to be able to offer it to you in some written form so that you could focus in on something, right? Not just think about what we spoke about, but something to to really guide you through it. And so again, let us help you focus in on your goals and and help you ignore the rest. And, you know, when when we have these type of markets that were that were involved in and have been for the past year, it's it's easy to to try well let's let's buy this mutual fund or let's buy this stock or and you're all over the place you're spinning your wheels rather than focusing in on how am I going to get to that goal of having that guaranteed income. You know, and that's the whole point of life as we go through it is to have income to sustain our lifestyles. And so if we focus in on income instead of how much we're building up, right, there are guaranteed ways to focus in on income. And if you want to know what or how to achieve that, give us a call at 386 228 5769.

Producer:
Yeah absolutely right and go to MyProsperityTeam.com as well and you can reach out by clicking there on the contact us page and just fill out that really simple form there send it to Ed and he'll get right back to you. Absolutely. Well, so as we've been mentioning here, Ed, we're going to tee up this next segment, which will be a big chunk of the show and that are the big takeaways from 2022. You know, it was not a great year for the markets. It was not a great year for a lot of people's 401. Ks, their IRAs, any type of investment that they had in the markets at all, and even their bond portfolios. You know, bonds are supposed to provide that safety when the markets are down, bonds are supposed to go up. Well, that hasn't really been the case this year at all. It's been kind of just I think the technical term for it once again is weird. It's been a weird time in the financial world. So let's let's take a look at it here. And as we go through the big takeaways from 2022.

Edwin Cruz:
Absolutely. You know, 2022 was a reminder that down years do happen. Right? In fact, this was the worst year since 2008 when we had the housing crash. And so you need to be able to manage your risk in a in an effective way that protects your principle and gains the best that that you can or the best way that you can. The S&P 500 lost a little over 20% and 2022, and that's your broad index. That broad index definitely reflects quite well to what I was seeing towards the latter half of the year when I visited clients and new people. Nasdaq lost a little over 35% in 2022. Again, if you are heavily invested in technology, you kind of felt it a little more. If if you were a little broader, you know, you were in that range of 20 to 25%. And I will say, you know, when I go back and look at everything. Which I obviously have done. The average loss that I saw out there, to be more specific, was right around 20 to 23% in portfolios. That's quite a substantial number. When you sit down and think about how much that is in cash and how long it took you to save that in terms of years to lose it in one year, it's quite painful. So there's there's a lot that continues to happen. Obviously, we see inflation continues to to rise, although it's gone down somewhere at about 7.1%, I think is what I last saw. You know, it's still quite high. I mean, we haven't seen this type of inflation in a long time. But, you know, as as we keep spending or at least our government does, we see that the feds are are not not shying away from raising those interest rates. And by doing that, with that Fed rate rising, that is what that's what's hurting the bond market. That correlation that generally happens between stocks and bonds isn't happening because of those rises in the interest rate.

Producer:
Yeah, and that's what's led to a lot of that weirdness as we as we say, you know, trying to combat inflation is something that's also led to these these interest rate increases and other measures to try and combat inflation is also led to a lot of these corporate layoffs that we've been seeing as well. That's been one of those contributing factors. You know, you see a lot of these tech companies, I think what was it, Amazon just this past week announced, what, 17,000? I think it was layoffs. It was in the teens.

Edwin Cruz:
Yeah. 5% of their.

Producer:
Workforce. Yeah. Which is just crazy, crazy number. And you go back not all that far or all that long ago in history and you know Amazon was probably seemed like they were hiring that many people a day for for a good long while. Right. But yeah it's really tamped down a lot of the economic growth which you know the Fed sort of goal there is to prevent the economy from overheating. But it's they're trying to walk this tightrope of how do we do we go too far or do we not do enough? Like it's a very delicate balance, You.

Edwin Cruz:
Know, absolutely is, because too much of that obviously is going to cause a recession and who knows how deep that recession could get. So you do have to play a little balancing game. And and, you know, we've seen fuel kind of come down some, which is always a welcoming cost that we'd love to see go down because most Americans are out there traveling to their jobs and to functions. And, you know, you want to have a little fun, go here, go there. But when gas prices, you know, when it's costing you 80 to $100 to fill up your tank, well, that kind of takes a little joy out of you.

Producer:
Yes, it does. It makes the road trip not quite so fun. Well, you know, I saved up all this money to go on this vacation, and now I've spent all my money putting it in the tank of my car. Yeah, it's not a fun thing, but, yeah, as you said, you know, the prices have come down. They've spiked a little bit since that big winter storm that came through much of the country here a couple of weeks back, I think just before the the Christmas holiday. And boy, it was cold up here in Atlanta where where I live. It was down into the single digits. I think we had wind chills below zero a couple of days. Oh, boy. That was luckily, all we got was a cold in the wind and we didn't we missed out on like those blizzard conditions. But I imagine I would venture a guess to say, because I've been in Florida around this time of year that you're doing better than we are up here.

Edwin Cruz:
But we're doing better. But I'll tell you, when you had that cold blast, we had we had four days where it was freezing or worse here in the Orlando area, surrounding area. So, you know, it was chilly. And, you know, we mentioned gasoline, but of course, you know, electricity, natural gas, oil that, you know, heats up homes. You know, all of these prices, when we compare it to a year ago, you're you're definitely paying an extra 10 to 20%, depending where you are in the country. You're paying more for it. You know, I do have gas that's delivered to the home, and I've definitely seen a spike in that price. So, you know, it's it's affecting everyone. And and we live in Florida. I can't imagine if you live somewhere north of of of the Mason-Dixon Line, as they call it. You know, when you live up in those northern states and it's just cold every day and it's, you know, 20 to 30 degrees, I can't imagine what those people's fuel bill is like. And, you know, it's no fun. And of course, you know, feed into that. We still have a war going out there in Europe and winter storms. Well, we're far, far, far from over there because we're just in January. And it seems like towards the end of this month, in February, typically seems to be your worst month. So we're definitely headed for a lot more of demand when it comes to energy.

Producer:
Yeah, absolutely. Ah, and then, of course, energy prices. It doesn't even. And there you know, we've talked about inflation sort of across the board. But one place where people have really been feeling it has been, you know, going to the supermarket and going to out to restaurants. You know, food costs have really, really gone up. And there's some interesting stats here, Ed, from the USDA. And they break it down by category. Right. So those that food at home, which is when you go out to the grocery store or the supermarket and you buy food, you bring it home, you eat it, you prepare it there, That rose 12% over the past year, 12%. And then this was a little bit of a surprise to me. What rose less than that? Were the food away from home? So that's going out to restaurants that rose eight and one half percent. Of course, that was already already more expensive to begin with than, you know, buying food at the grocery store. But still, either way, you're not going to be happy. But I can't necessarily imagine a bunch of people being like, oh, should I go out to eat now? Instead of going to the grocery store and buying my food? But I don't know, maybe that's crossed their mind.

Edwin Cruz:
You know, it's funny because I do see a lot of people out in restaurants. I've spoken to strangers and they'll sit there and say, you know, we're we're actually probably we might be eating out more now because things are so expensive in the supermarket. And, you know, I think people are swayed when they see that one time bill supermarket bill, It used to be, say, $175. Now it's 250. You know, you start making irrational decisions. Although it went up, let's say $75, because I've seen I mean, you've probably heard of a place called Aldi. They're supposed to be your your discount food store. Right. But, you know, recently my wife went there and for the first time ever, I saw a $220 receipt coming out of Aldi. I mean, I would have never thought that. So, you know, but you start seeing that, you start thinking that you're better off because it's costing you so much more. You're better off going to the restaurant. Well, you know, do that two times a week for four, four weeks in a month. And those eight times alone will cost, you know, less than for a couple. You're talking $500 at minimum. And that's that's getting off easy. So, you know, it's people definitely need to start making better decisions. It's still going to be cheaper to cook your food at home If you can afford it, more power to you. But, you know, if you're if you're looking to create that that that future that you want to create, sometimes you just have to trim a little bit around that. Around the edges.

Producer:
Yeah, absolutely right. You know, just cut where you can and be able to afford those essentials still. And another thing, too, just before we move off of the whole eating thing, because, you know, it's one of my one of my more favorite topics here.

Edwin Cruz:
One of our pastimes, right?

Producer:
That's right. That's right. I do I do enjoy stuffing my face every now and then. But, you know, I mean, when you look at the bill at a restaurant, too, I've seen a lot of these like COVID surcharges and things being added to restaurant bills or even just like a, you know, a you know, a lot more restaurants pre adding some sort of service charge like that would be, you know, some 18 to 20% like what you would probably tip normally just going ahead and adding that to the bill in advance rather than letting you tack that on at the end. So it's like, you know, maybe the the items themselves have gone up in price a little bit, but then those extra charges are also adding more to your restaurant bill as well, at least from my experience.

Edwin Cruz:
Oh, absolutely. You know, I was thinking about that after I stopped speaking. I'm like, yeah, I had the tip after that, too. So absolute surcharges, tips. You keep adding it up. It gets expensive.

Producer:
They'll they'll nickel and dime you and then the nickel and dimes turn into dollars and fives and tens and twenties. Yeah. Well and then of course, you know we mentioned interest rates a moment ago, but but put this into perspective a little bit for us because it's been across the board that these people hear interest rate increases and they think, okay, what the Fed does is just from a technical standpoint is that they raise what's called the federal funds rate. That's what they control and that's the overnight lending rate that banks charge each other to be able to meet certain requirements of the Federal Reserve requires them to have a certain amount of money on hand, all that stuff. So they that's what the Federal Reserve charges. So then obviously it stands to reason, right, that if it cost the banks more money to borrow from each other, they're not just eating that cost there. They're going to pass the expenses on to you.

Edwin Cruz:
Absolutely. I mean, that's the way business rolls, right? Yeah. You know, just like we were talking about supermarkets, all that, you know, the more cost rise on their end, you know, fuel surcharges, everything else, it gets passed along. And, you know, I was just talking to a buddy of mine. He's a he's a real estate agent. And we were talking about this. One area up north here called Ocala and how much prices have gone up in this and horse country, as we call it. But. The the the pressures of the raise in interest rates right now, it's causing for home prices to start slipping. We're seeing homes now used to move in 3 to 5 days. And at one point it was you're lucky if you had 24 hours to think about putting your putting putting a bid on a house because it was gone if you didn't. But, you know, homes are now at 30 to 45 days and in some areas moving on 60 days listed. And that's because interest rates, you know, interest rates have risen, as you said. And if we go line by line here, let's let's go with let's see here fixed rate mortgage. We started out fixed rate mortgages, if you remember, we're slightly under 4%. And you know, from from that point to now, you know, we're close to 7%. And when you think about that, that's a it's about a 75% increase in interest interest rates on a home.

Edwin Cruz:
And that's a big number, you know, by 30 years. If we look at new cars, if you go out there and it could be a used car because even used car interest rates are are tremendously high. But on average, we're looking at 6.1% when they were just slightly a little over 4% when my son got that expensive pickup truck just earlier this year. So I know these rates because because I kind of lived through it. Right. And look at credit cards. I mean, credit cards are high to begin with. They're about the only ones that didn't move much. But that's already because there are they're already taking advantage of you. They were slightly under 18. They're slightly over 19. So, you know, any way you look at it, you're not really getting a break in any way, shape or form. And even though they've raised these rates at a clip of three fourths of a basis points the last time at at half a basis point, I truly believe we're going to continue to see this. And they've made the remark that they're going to and they've said that in the past and didn't hold to that. But at this point, I don't see this thing slowing down. I see another half percent, at least another 2 to 3 times this year at minimum.

Producer:
Yeah, That's I think sort of the consensus from a lot of people who are looking from the outside in on on the Fed's moves are feeling that same sort of way that you know from the signals reading the tea leaves here that's kind of the expectation is that interest rates will continue to go up. Maybe by that, as you say, half a percentage point rather than three fourths of percent that we saw earlier with those several increases of that magnitude, which we had not seen in so, so long. We'll give us the bottom line here. I mean, it was a rough year for a lot of folks for for most everybody who is out there who had this sort of, as we call it, buy and hold strategies for their stock and bond portfolios or whatever their investments are for the future. It was a rough year. And so put bring it all into focus here for us and put it into perspective as we kind of move forward.

Edwin Cruz:
Yeah, I like that. The bottom line, So I will say that from experience as I'm talking to people out there, what I'm seeing is that too many pre retirees and retirees are afraid to spend their money because of the Dow markets and rising inflation. You know, they're not sure what they're going to have a month from now, three months from now, six months from now on their on their portfolios. You know, on our end, we know that we keep people safe, but we don't hold 100% of our clients money. We want it to be an overall good plan for them. So, you know, the big worry is what are they going to have come six months, nine months, a year from now? We don't have a crystal ball, but at least we can help put you in a in better hands. Right. So we want to help you solidify a plan that will empower you to live the retirement lifestyle that you've worked hard for. So. So how can you get started just by simply contacting us today at 386 228 5769.

Producer:
That's right. And when you do call that that number, you can get a full and free, completely free of any cost, any obligation retirement consultation with Edwin Cruz. And you can call that number again it's 386 228 5769 or you can go to the website MyProsperityTeam.com. And so when somebody does reach out to you and say that they're they're spooked by what they've seen in the in the markets and in the financial world all all tolled over this. Last year. What does that free consultation look like?

Edwin Cruz:
Yeah, absolutely. We'll go over the plan that you have and you may already have annuities in your portfolio. You may have mutual funds in stocks, but you're looking to improve upon what you have. So when you do after we do the review, we will see if there's a way to cut down on the fees that are in your current plan. If you just have an outdated plan that needs to be renewed, we'll look over any IRA or 41k that you may have out there. You know, at first glance, when we speak to people, when we work with people, we don't always get all of the information. For as much as you stress, it's important for you to know everything about their situation to best help them. I have found that about 50% of the clients will come to me later on and just tell me that, hey, you know, I know you asked for all this and I wrote all this down for you or, you know, we did this together. But I do have another account sitting over there. And so we'll go over that and we'll find ways to improve upon their situation. But, you know, apart from that, you know, if you're pre Social Security, let's talk about your Social Security strategy that you have going forward. What Medicare plan do you have? Is there a way to improve upon that Medicare plan? And I know that the enrollment period is over, but you can always prepare for the next one. So, you know, we could help you there. So there's a number of things that will help you do. It's not just it's not just looking at your finances. We're looking at income. We're looking at your tax exposure. We're looking at a lot of things. Let's sit down, talk. Let's make this 2023 a great year.

Producer:
Yeah, it's more than just your basic consultation there where we're saying, okay, well, here's the money you have in the bank and here are some of your expenses and och well you know, take in more than you spend and that's it. That, that would be a very basic thing but it's a comprehensive consultation. So if you would like something that is very comprehensive, absolutely free of charge to you folks, go to MyProsperityTeam.com or call 386 228 5769. And you can also call up and receive a copy of the book annuity 360 it's by Ford Stokes who is a great guy great financial advisor in his own right and really knows the ins and outs of annuities and puts it all together in this book in just a very approachable way and in a very non intimidating way. I think that you can learn a lot. It's not a very long read, but it is crammed full of great information about annuities. So go to the website again, My Prosperity time.com or call 386 228 5769. You can get a free copy of that book by reaching out to Edwin Cruz. We'll add we as we move on here. So so wrapping up this sort of section of the show, I teed this up in the beginning that there was a lot of bad news. And we've we've run through pretty much all the bad news that we can there and that, you know, there are you know, there's inflation, there's interest rate increases. We've got down markets and all of that, all of the bad stuff. So that's all the bad news brighten our days here a little bit because there's got to be some good news in all of this, right?

Edwin Cruz:
Absolutely. You know, this market does present buying opportunities as as you would hear any advisor out there talk about. But, you know, when you're going into the fixed market, I will caution people that there's a lot of information out there. You have to know how this information or how it was derived. You want to make sure that you're not being given numbers that that based on current rates or current opportunities, make you think that that was what you just missed out on. So I know that that may confuse a lot of people out there because just in me saying it, I know what I'm talking about, but it does sound confusing. You need to sit down with someone that will go over what past numbers look like, current numbers, you know, how are these numbers back tested? It's very important because companies will and this is down the board find financial in the financial world, people will just pick out the best day to start the best data and and give you that type of number. You know, you want something that's truly tested on a daily on a daily basis over a period of time to come up with a true back casted number. There's just so much information that we can give you to show you how you know what to look for. Don't be deceived by this. You know, watch out for that landmine. But there's a lot of great buying opportunities, as I said, especially in certain sectors that we have confidence in. It's a good time to get into a fee efficient asset with your current holdings, and we could start having that Roth conversion plan put in place.

Edwin Cruz:
You know, you may you may have plenty of write offs from what happened last year. You may have sold some stuff off at a loss. So this would be the perfect time to do a conversion to offset those those taxes. So again, opportunities out there, you may not know what's out there working. I do have an index referral sheet that I look at on a month to month basis. I look over many of the indices that are in the marketplace and we can track either progress or regression within that. And at the end of the year, I just got my final year end report. I see that there are certain indexes that came up. So just because the market's down doesn't mean that there's no opportunity. There's always opportunity. You just have to know where to look for that opportunity. So, you know, let us be that source to help you get through and navigate through these issues that, you know, unless you have a little insider information, you're not going to be able to decipher this. So let us help you do that moving forward. We do have other ideas. You know, you may you may want to start a Sep IRA. If you're a small business, you may be looking to get out of your your current 41k plan, but you're still employed. You know, that's that's also a tricky area. But there are so many ways that we can help you. There are so many opportunities. Just give us a try and we won't disappoint. Yeah.

Producer:
Yeah. That's what the point of all this is. You don't know what you don't know. So find out what you don't know by talking to an expert. And I know a guy. His name is Edwin Cruz, and you can call him at 386 228 5769.

Producer:
Need a higher rate of return from your safe money. Listen up. It's time to beat the bank CD rates.

Producer:
So as we started off the show today, Ed, we mentioned savings accounts and, you know, sort of one type of them is a bank CD certificate of deposit. It's been around for a long time and. Are one of our quotes of the week was basically saying how many people do you know became millionaires by investing in savings accounts. Cricket, cricket, Cricket. You know so let's talk about beating the bank CD's. One of the one of the sort of weird things about the current economic environment that we're in right now is that with interest rates going up, some of the interest rates on a lot of bank CD's will go up as well. But there are still, we think anyway, much better opportunities out there for folks. Break this down for us.

Edwin Cruz:
Absolutely. And you know, you call them certificates of deposit. I know plenty of people that call it certificates of disappointment, but that's a whole nother story.

Producer:
Especially these days, right? Yeah.

Edwin Cruz:
You know, beyond the reasonable emergency fund, we don't like to see people holding too much money in savings accounts. Cd's kind of are in that area, you know, put that money to work for you at rates that make a difference. You know, you want to get a reasonable rate of return. And when you start talking half percent, 1%, one and one half percent, 2%, is that really a reasonable rate of return? You know, we have solutions like multiple year guaranteed annuities or as some insiders call it, migas solutions that range from 2 to 5 years. Very simple, straightforward, just like a CD, but with better protection. And and it's a better way to grow your wealth. So why get 2% on a on a two year CD when you can get 3%? Why get three and one half percent on a five year CD? When with a MIGA, you can receive 5 to 2, five and a 4%. There are just there are smarter ways to do things. It's it's it's the same as far as the look of it on on the on the cover. But when you dive inside of it, there are so much more protection inside of it. You know, it avoids probate. You're getting a larger rate of return. You can turn this into a lifetime income. You can't do these things with with CD's. So you know, why not upgrade? You know, we all like to upgrade. I don't know anybody that would would say, yeah, I'll stay here when I know that this is better for me. There are plenty of ways to better yourself and that's what today is all about. Let's get 2023 started off on the right foot and let's make better decisions for ourselves, for our families, and for our future.

Producer:
Yeah, you're right. Absolutely. You know, seize the day. See? Seize the year, Make 2023 a great one for you. And, you know, I was just looking here at actually at bankrate.com, looking at some bank CD rates. And a lot of them look like they could be fairly decent, but some of them that looked like they're better rates are ones that banks that I've never heard of. But you look at the look at the big boys like, you know, Bank of America, for example, Chase or Wells Fargo. I mean, they're all just at one and one half percent or well below that. I mean, you know, with B of A and Chase well below 1%. So it's you know, you're just not getting you're not even remotely trying to keep up with inflation at that point.

Edwin Cruz:
And, you know, when you think about reserve requirements, right, Because we look at banks, we say, yeah, our money safe at the bank. But did you know that they only have to keep about 10% in reserve where when you have a mega multiple multi year guaranteed rate annuity there is dollar for dollar kept in a reserve account. What does that mean to you? You know, if a company were to run into some trouble, at least you know that 100% of your assets are there and can be directed back to you versus the possibility of waiting up to ten years to get it back from a bank. So even if the interest rates were equal, I would say there is the advantage on the annuity side because of reserve, because of avoiding probate, being tax deferred, giving you that tax advantage. There's just so many things that I could say. It's a win win win for you in a mega over a CD. I mean, we could we could have a show on that itself.

Producer:
Yeah, absolutely could. There is so much to go into with it. And, you know, another type of annuity that we talk about quite a bit is a fixed indexed annuity. And that's one of these things. Where we've as we sort of mapped out the show this weekend, we were talking about, you know, if people want to make just one change to their retirement plan in 2023, a fixed indexed annuity could be a great solution for a wide swath of people, because here you have, you know, the old defined benefit plans from employers like the old pension plans that have gone the way of the dinosaur largely. But even though those have really disappeared, for the most part, a fixed indexed annuity can really be your own personal pension that you create for yourself.

Edwin Cruz:
Absolutely. You know, you've got to take advantage of the interest rate environment right now. And, you know, it's it's a big topic when we talk about interest rates. This has this has created so much more opportunity in fixed index annuities. And so by replacing the bonds that you currently hold in your portfolio with fixed index annuities, you could take advantage by getting rid of not just your bonds, but anything that has a low yield in savings. You know, the the new 60 over 40 portfolio is 60% stocks, 40% fixed index annuities back if you turn back the clock ten, 15 years ago, they used to say 60% stocks, 40% bonds. But that is no longer shown to be the most effective way to move on in your portfolio if you really want to stay up with times. And we all do. Again, fixed index annuities are a big part of of the mix. You know, they're even talking about adding these into into retirement plans into 41k plans and there's a reason for that. They have found to be extremely effective. Will they outperform some individual stocks? Absolutely not. But that's not the goal anyway, because, again, if if that stock portfolio grew to 200,000, now, what what are you going to do with it? How are you going to how are you going to create your income stream? Are you putting too much pressure on that portfolio? Are you maybe being a little too light with it? Let us help you get it right. And that's what this is all about, Making a better 2023 work for you this year. Let's do it. You know, just give us a call. Know annuities are safe, they're fee efficient, and it's a way to generate an income for life. So why wouldn't you want to better yourself?

Producer:
Yeah. And folks, you can reach out at MyProsperityTeam.com or call 386 228 5769. That is 386 228 5769. If you would like some more information and you know Ed we've talked about the book annuity 360 here and I think this is actually a good place for us to share just a little snippet from the book. It's the chapter that has to do with what we were just talking about, the fixed indexed annuity. The annuity is just right. We like to call it the Goldilocks annuity around here. Sometimes it is the fixed indexed annuity. Let's listen to a little bit of Ford Stoke's, the author, reading from annuity 360 here and we'll talk more about it and continue with the show on the other side.

Ford Stokes:
Chapter 13 The Annuity. That is just right. The fixed indexed annuity. Big idea. A fixed indexed annuity gives you a portion of market like gains without market risk. Your investment is tied to an index but not directly invested in it. How does it work? And fire gives the owners or annuitants the chance to earn higher yields than fixed annuities. When the index they are tied to performs well, they typically will also provide some protection against market declines. The rate on an fire is calculated based on the year over year gain in the index or the average monthly gain over a 12 month period. Fires often have limits on the potential gain at a certain percentage. This is known as the participation rate. The participation rate can be 100%, which means the account would be credited with all the gains, or it could be as low as 25%. Most fiAs have a participation rate between 80 and 90% benefits guaranteed income stream with Americans living longer and spending more time in retirement, many retirees are concerned about outliving their savings. In turn, they're searching for a product that can help ensure a steady income stream for A IS are designed with guaranteed lifetime income so you can never outlive your earnings diversification of portfolio. A balanced portfolio is essential for managing risk and reward in the financial markets designed for the long term phase are a great retirement vehicle to ensure you're not putting all your eggs in one basket for a IS offer the ability to make some money without the risk of losing it. Secure principal. Even with market volatility, investors will not lose value on their fixed indexed annuities. Your savings aren't exposed to market fluctuations, so even in a negative market return, you will not fall below zero.

Ford Stokes:
You can never lose your interest once it is credited to your principal tax deferred growth phase. Offer long term tax deferred savings. As long as your money stays in the annuity, you will not be taxed on the interest earnings. Once you receive a payout, the annuity will be taxed just like ordinary income predictable earnings. Because fees offer predictable income, Americans feel more comfortable when withdrawing funds from these retirement vehicles as opposed to an IRA or for one K. Choosing an FIA is an efficient way to plan for your future as your interest earnings rate always remains somewhere between the interest rate floor and the cap. No matter what happens to the market, you can still count on payments throughout your golden years. Potential drawbacks of fixed indexed Annuities Surrender Charges. A surrender charge is a type of sales charge you must pay if you sell or withdraw money from a fixed, indexed and even a variable annuity during the surrender period, a set period of time that typically lasts 6 to 8 years after you purchased the annuity. Surrender charges will reduce the value and the return of your investment withdrawal limits. Almost all fixed indexed annuities play surrender free withdrawal limits within the annuity contract that generally range from 5 to 10% of the principal. While all annuities must be armed, friendly and provide for a penalty free withdrawal from a qualified annuity account equal to the RMD requirement for the client's age carriers limit the amount of withdrawal to enable them to grow the money invested for themselves and the client not suitable for short term investing. If you want to grow your money, but you also need access to 100% of your money, then a fixed indexed annuity may not be right for you.

Producer:
Fixed annuities, including multi year guaranteed rate annuities, are not designed for short term investments and may be subject to restrictions, fees and surrender charges as described in the annuity. Contract guarantees are backed by the financial strength and claims paying ability of the issuer. Remember, all of Ed's listeners receive a free financial consultation just for listening to the show, visit my prosperity team com to learn more and schedule an appointment. Thanks for listening to Prosperity Principles and subscribing wherever you listen to podcasts. So that was a clip from the book Annuity 360 read by Ford Stokes, the author of the book himself. And if you enjoyed that, if you learn something, you can get a free copy of the book all completely free of any cost or any obligation to you. Just go to MyProsperityTeam.com or call 386 228 5769. That's 386 228 5769.

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

Producer:
So in this week's inflation demonstration, and we talk a lot about inflation on the show, but that's, of course, because it is it is a thing that's really affecting us all. But here's something I think that's going to be our topic of discussion today that will probably hit home for a lot of people. And that is something from this Fox Business article about the the adult children of retirees really worried about their parents finances, right?

Edwin Cruz:
Absolutely. Because it has an impact. And, you know, sometimes the the thought could be for one reason, maybe not so good and the thought could be for good reasons weren't really worrying about their parents. But, you know, high inflation, you know, is is taking its toll on families. And 60% of respondents expressed concern that inflation is hurting their parents financial situation. And many said that they're afraid that their parents won't be able to afford retirement in later years. And this is from the survey from American Advisor Group. The retirement savings crisis is real, and many Gen-X adult children are telling us that caring for their parents will be extremely difficult and potentially unattainable. And that's from Eddie Herder Arg's, vice president of Brand Strategy. And I will say, you know, I, I hear these people, you know, what was it about two weeks ago sat down with someone? We're going over their income stream. They have a pension. Fortunately, Social Security and and that's it. That's all they were taking for income. And so, you know, in speaking to the parent that called me in and the child that was sitting there, we started discussing, well, do you have any assets that you could, you know? Derive some income from because this is what they were showing me and they're presenting me with a list of how much they pay on a monthly basis.

Edwin Cruz:
As far as bills, they're showing me what the income is, and they wanted me to create magic out of that. And you know, I'm not a magician. I'm here to to to help create solutions to problems. And so when I asked about what else they had, well, yeah, they had a CD at a bank close to six figures. They had a brokerage account, no IRAs in this household, but they did have a brokerage account that was well over six figures. And I said, Well, what are you using that money for? Well, that's in case I need it for nursing home. I need to keep it liquid. That's in case things get really bad. And I'm just left there scratching my head and they're so worried about all these other things, just like we were talking about earlier. You know, if you have that squirrelly brain and you're not really focused, you just can't really come up with that plan or solution. And I said, well, why not fix all this in one fell swoop? You know, what does it take? I started asking them questions. What's it take in case you need long term care? What do you think you'll need? Well, you know, the average cost about 60, 70,000 and so on and so forth.

Edwin Cruz:
And this gentleman was in very good shape. So I presented them with a solution that by putting X amount of dollars into this program, you get three times the amount for long term care boom. We settle that long term care issue once and for all. They felt so good hearing that. And now we had all this extra money that was just from the CD. Now we have all this extra money. Would you like to have an income from that? And if you need anything extra in addition, long term care, whatever it may be, we can we can we can make sure that it's there for you for that reason. So again, inflation has people thinking not in the best ways, but we have the solution to beat the inflation. We have the solution for the other problems that may be on your mind. And trust me, when it comes to health care, inflation really is a big thing because regardless of what's been going on in the stock market, inflation in health care has been tremendously high for well over two decades, three decades. So a big concern, inflation. But when it comes to health care, you can add that to it times three.

Producer:
Yeah, absolutely can. And you know, and especially if people are walking around with with no insurance or with insurance, that's not the best, then they have to pay more and more out of pocket. And boy, it can just especially if you have no insurance coverage at all from a health standpoint, it can just really wreak havoc on your finances. And you're right. Absolutely. That is what a lot of people do worry about. But I can imagine that that has got to be one of the most satisfying parts of the job is when you find a situation like the one that you just talked about and you said, wait a minute, what else do you have? And they have well, we got this in a CD. And he said, you know, just again, why is that? Why is that there? Why is it not doing something else for you? We can actually make it work for you. We can address your needs without having to tie up all this money forever. And then all of a sudden, oh, they just have so much relief. I'm sure it's like a weight was just lifted off of them.

Edwin Cruz:
They had a purpose for it, but it was misappropriated. Yeah, right. And so it's just about giving saying, Hey, you know what? You have this concern and you have that sitting there, but this is the way to handle that problem. And then you have this other problem here, which now with that being freed up, now you have this. And if you need it for these other purposes, it'll help you with that. So, you know, it's just if you don't, as you always say, you know, you don't know what you don't know. If you don't sit down with someone that will give you these these ideas, ways to accomplish these things, you'll just you'll always be left scrounging around, not knowing what to do, Just because you didn't take the time. You were too afraid to sit down with someone. And let me tell you, you know, I've done radio not just here now, but in the past on another network. And I'll tell you, some people listen to me for three months, six months, a year before they have the courage to call. And I want to invite people to just call, ask the question. Listen, we all don't know something. I don't know everything, right? If I have a medical concern, I'm calling someone. If I have some other sort of concern, mechanically, I call someone. And so financially, if you have that concern, call me. Let me help you.

Producer:
Yeah, that's right. And you can call 386 228 5769. That number once again, 386 228 5769. It's this week in history. So some big things happened this week in history in the sports world, especially here. And starting off with one more than 100 years ago this week Back in 1920, right?

Edwin Cruz:
That's right. You know, and one of the most impactful transactions in Major League Baseball history occurred when Babe Ruth was bought from the Boston Red Sox. And me being a New York Yankees fan, obviously, this was a great move by my beloved team. And so, yeah, that's that's a fun one for me to talk about.

Producer:
Yeah, I bet. You know, I mean, I think they made out Oak and that particular deal, you know, particularly because the first Yankee Stadium was obviously the house that Ruth built and all that. I mean, he was just just the probably the most legendary baseball player of all time and, you know, most legendary for wearing the Yankees uniform, too, I will say.

Edwin Cruz:
And if you think about this, that move is still paying off for the Yankees. Whenever somebody buys a Ruth shirt with the Yankee logo on it, it's still paying the New York Yankees. So, yeah, thank you very much.

Producer:
Here. Over 100 years later, you're still reaping the benefits. Well, another baseball related happening happened this week in 1976 when Ted Turner purchased the Atlanta Braves, get this, for a reported $12 million for the entire team.

Edwin Cruz:
What an investment.

Producer:
I mean, really, they haven't won as many World Series as the Yankees have won, obviously. But who has? But they've won since 1976. They've won two World Series umpteen thousand, it seems like pennants in the postseason, whether it's a league championship or a divisional championship. So, yeah, it's a good return on Ted Turner's money there, too.

Edwin Cruz:
Oh, my goodness. It doesn't get any better. I mean, that that team is now worth, who knows, 506 hundred and 700 million. It's a great franchise. The Atlanta Braves, Ted Turner, TBS network, the whole works. I mean, they got it going on.

Producer:
That's absolutely right, 100%. Well, also this week in History in 1975, Wheel of Fortune, the TV game show made its very first airing on NBC. I do. You do you watch much Wheel of Fortune, Ed?

Edwin Cruz:
You know, I used to more in the past, not so much anymore. But as we could see here, I mean, the show ranks as the longest running syndicated game show in the United States and has taped over 7000 episodes. That's a lot.

Producer:
Yeah, That's a lot of Pat Sajak and Vanna White. There you go. Well, all right. Well, just about running out of time here, but I got again, I'll get in one more this week. In 1935, it was back on on the eighth in 1935, singer, guitarist, actor, all all around. Very talented guy. Elvis Presley was born. Um, and my, my sister has actually just become like this Elvis super fan over the past couple of years. She went to Graceland and the whole thing. And so I know that that date means a lot to her as well as I'm sure it does a lot of people, because Elvis is a legend.

Edwin Cruz:
He's iconic.

Producer:
Absolutely. So we'll add that just about does it for this week's episode of Prosperity Principles. I thank you, sir, for once again, bringing great, great advice. A lot of things, a lot of great knowledge for folks who are listening. And I appreciate everything that you do. And we'll talk again next week.

Edwin Cruz:
Thank you, everyone.

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. A measure of life 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.

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