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PP_FullShow_062422.mp3: this mp3 audio file was automatically transcribed by Sonix with the best speech-to-text algorithms. This transcript may contain errors.

Matt McClure:
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.

Matt McClure:
Welcome to Prosperity Principles with your host Ed Crews. 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 it 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 Crew's.

Matt McClure:
Hello and welcome to Prosperity Principles. I am Matt McClure here alongside the man of the hour himself, Ed Crews. Hi, Ed.

Ed Cruz:
How are you, Matt?

Matt McClure:
I'm doing well. I'm hot, but I'm doing I'm doing well.

Ed Cruz:
Everyone else feels that way right now. The temperatures are.

Matt McClure:
Soaring. I know, right? I mean, in I'm, as you probably know, based in Atlanta, but you're, of course, right here in beautiful central, sunny central Florida. And things are things are pretty much always hot this time of the year.

Ed Cruz:
Yeah, you forgot that. Humid also.

Matt McClure:
Oh, the humidity is really what gets you. I spent a couple of days in Las Vegas not all that long ago, and it was hot. But but the dry heat is just different. And people will make fun of me for saying that. But it really is.

Ed Cruz:
But it is because I've been there and I can tell you all you have to do is walk out to your mailbox and you're already breaking a sweat here.

Matt McClure:
That absolutely it kind of hit you like a ton of bricks sometimes when you walk outside. But so we are here, of course, not to just talk about the weather. We are here to talk about on this week's program what to do with your money right now. And that is something that I know a lot of people are wondering because of all that's going on. When you look at the at the financial headlines, you look at the stock market, you look at just everything that's sort of happening in the world. Before we get into too much of that, though, if someone is tuning in for just the very first time, remind them, if you will, or introduce them to yourself, if you will, who you are and what it is that that you do.

Ed Cruz:
Well, for 24 years now, I, Edwin Cruz, the owner of Prosperity Financial, have been out there helping people in central Florida. Helping them with their with their number one concern, and that is how to preserve their assets. And so for many years, you know, people have asked me in many different various forms, how can I get these gains? How can I protect my money? You know, they say it sounds too good to be true, but I'm here to tell people that it really does exist.

Matt McClure:
Now. And that's an important thing to know, is that there's not you know, you don't always have to be. Speaking of Las Vegas, which I did a moment ago, you don't always have to be stepping up to a a table game when you put you put your money down. It's not it doesn't always have to be a gamble. There can be some safe and secure returns on your investments out there.

Ed Cruz:
Absolutely. And, you know, it's been dubbed the modern dilemma. I don't know if you've ever heard the term, but, you know, people are just constantly asking, how does one grow their money without jeopardizing that, their wealth? And I think it's an obviously an important subject to cover. And most people don't even know that these options exist out there.

Matt McClure:
Yeah, it's very true. And so that's why you're here, is to educate folks on exactly what those options are. And because knowledge is power, you know, and when we're talking about money, knowledge is can be money, too. So if someone calls up at and we'll give them, of course, the the contact information and the website info and all of that here momentarily. But if somebody contacts you and wants to work with you, they they have those questions raised. Some of those questions that you talked about, what's that experience like? What's it like when somebody calls or reaches out and and says, hey, I'd like to work with you, get some advice about what I could do with my money.

Ed Cruz:
Well, the first thing I'd like to ask them is what their overall concern is. What is it that they plan on doing with that money? Is it more for their own income needs in the future to supplement their their income? Or are they looking to pass this money along to their beneficiaries? A little bit of both. So once I understand what your needs and concerns are, then we could move on to the discovery phase. What is it that you're trying to protect? How much of your assets are you trying to protect? We try to keep it simple, basic to the core, because when you cover too many subjects at the beginning, obviously it could leave your head spinning. So we don't want to do that. We want to make it simple. We'll cover the other subjects later, but let's first find out what's really moving you at this time, and then we can move forward at a later time with the with the rest of the portfolio or the rest of what your interest are.

Matt McClure:
Yeah, it's you know, we talk about all of the options that are there. But as you say, because there are so many options, they can be confusing. So it's really important to have someone like you to then help make sense of it all because you'll need you'll need a hand in all of this. I mean, you know, when I was looking into different types of annuities, I had no idea that there were so many different types of annuities in so many different options out there. But of course, that's something that you know very well and I'm sure help all of your your clients sort of sift through and find the thing that's right for them because it's not a one size fits all deal.

Ed Cruz:
That's right. You know, some people want wealth preservation. Some people are wanting to know how they can lower their their tax exposure. Some people are looking for, like I said, that guaranteed income. It just depends what you want to do. Are you looking to retire in two days, two months, two years? So plans are going to vary based on your timeline and what your main concerns are. So we we definitely have to customize a plan for you in order. For you to have that future success.

Matt McClure:
Yeah. And if people do want to reach out and what's that information, share it with our listeners as we get the show really, really going here today.

Ed Cruz:
Yeah. If you want to reach out and have a chat about what you're concerned may be, you can reach out to me at 3862285769. And I'm offering to anyone that calls in and is looking for some additional information. We have a book called The Annuity 360 Learn All You Need to Know About Annuities. And and I think that this will be a definite way to jump start the teaching process here.

Matt McClure:
Yeah, definitely so. And we're actually going to hear a little snippet from the Annuity 360 book coming up just a little bit later on in the show. So once again, that number, folks, 3862285769. And you can get, of course, that free copy of Annuity 360 with your call my prosperity team dot com also is the website. Well on to kind of the meet of the show here today ad and that is I teased it up at the top here what to do with your money right now? You know, people are looking, as I said, at the stock market numbers and all of that, and they're saying, oh, there's so much volatility out there. And there really is you know, the markets have been volatile since the fourth quarter of last year. We we saw we'd sort of gotten used to over the previous decade or so of kind of this at least slow and steady growth in the markets. You know, post 2008 financial crisis, there was kind of a slow, steady growth. And then it sort of picked up pace. Picked up pace. We saw a volatility like 2018, 2019. Then, of course, COVID happened and now in the economic recovery, a lot more volatility. So it's just it's kind of scary for people, right? I mean, you're looking you're sitting here reading the headlines and it's kind of like, okay, what in the world am I going to do with my money?

Ed Cruz:
Yeah, absolutely. And the first thing people think of when when volatility hits the market, they want to turn to bonds. And, you know, when when we look at the performance of bonds over the past five, ten, 20 years, they've really underperformed. And so there have been many studies done out there, but one in particular done by by Mr. Ibbotson. And anyone that knows any of the financial analysts that are out there would be familiar with this name. But in doing these studies, they have now come to the conclusion, and many have Jeremy SIEGEL and several others, they've come to realize that bonds are being outperformed by fixed indexed annuities. So when we look at total performance in a portfolio, instead of having stocks and bonds or mutual funds in stocks and bonds, they're actually looking at having part of this portfolio supplementing out the bonds with fixed indexed annuities. And so they're playing a bigger role in retirement planning. And the the other major issue that that investment advisors are having out there is coming up with guaranteed income solutions. And so those are things that we like to concentrate on in your portfolio because they will make the world of difference in retirement down the road.

Matt McClure:
Yeah. And for our listeners who might be, you know, this is their first time joining us here on the show talked about exactly what if fixed indexed annuity is it's a very it's a particular type of annuity. I said there are a lot of options and this is one of them. But why is that one that you think does so well?

Ed Cruz:
Well, a fixed index annuity will protect your gains. And so when we think about safety, people think, okay, well, I want my principal to be safe, but no one ever gives thought to the gains as well. And so when you can think about ratcheting your money up and never being able to go backwards, that's quite interesting to a lot of people when they come to realize, hey, if I have 100,005 years later, let's say it's worth 125,000 140,000, regardless of what the number is that's also protected. It's not just what you put in, but it's everything that comes to end of term, whether it's a 12 month or a 24 month type index, it's fully protected. You don't have to worry about the seesaw of of the market, the ups and the downs. You don't have to worry about losing sleep at night. You can really put your head on the pillow and rest. Well, some people are worried about if I make X amount of dollars and this is not in IRAs, but in in just regular savings, you know, I have to pay taxes on my gain. Is there a way to avoid that? Well, I can help you avoid and help you defer taxation. If I can help you protect your money from probate. No one wants to give that money back to the government, so we help there. If you have a long term care needs, if you have home health care needs, a phrase can help you there. So they're very it's a very helpful tool in many ways. And so when we sit down and speak about this, obviously we can speak more in depth about more of the benefits of fire of fixed indexed annuities.

Matt McClure:
Yeah. And you talked about about taxes there as well for a moment. There are a couple of different types of tax free investments that that are out there. Really only two of them. One is that you mentioned they're a Roth IRA, the other is life insurance. And that comes to, of course, speaking of of an individual's needs, really, you know, benefiting the next generation family and or the family that really counts on you for you and your income to to live. And so this is providing for them in the future, right?

Ed Cruz:
That's right. And going to into the topic of the tax free investments, Roth IRAs are one segment of that and very interesting to know that there are created in 1997 and this was to help combat that issue of every income source that we have in retirement is taxable. So how can we create a tax free source of income for our futures? Now, just know that when you invest your money in a Roth IRA, the the initial investment and future investment into this Roth IRA, it's not a tax deductible opportunity at the time, but it will make a world of difference when you retire. How nice would it be to be at a lower tax bracket in retirement? When you're on a fixed income, it's different when we're currently working, making our wages or commissions or however anyone makes their living. It's easy to say, Well, you know, I have the opportunity to earn more. And so therefore and more than likely there's a two income household, but once you get to retirement, you really need to, you know, to put together a plan so that as inflation occurs like today or as other costs rise naturally, that you do have more in the bank that you're that you're protecting or that's protected for you. So a Roth IRA becomes a big advantage once you retire in the future?

Matt McClure:
Yeah, definitely. It's definitely one of those one of those tools to have in the arsenal there as you retire. And then, of course, we spoke about life insurance and passing along to the to the next generation and to your family as you and also building that cash value. And and you can also take cash or take tax free distributions from life insurance, as well as it builds that cash value.

Ed Cruz:
Yeah. But I'll say this before we get to the life insurance, let me add to that Roth IRA, because other thoughts came in. And I think it's important for the audience to know that when you have these type of of qualified accounts, always remember that if you take income prior to 59 and one half, you may have to pay a 10% federal penalty. So when coming up with a plan, again, we have to know when retirement's coming. Right. Also know that prior to the age of 50, your contributions at this point right now and that's what's in law are 6000 per year. And but if you are over the age of 50, you have what's called catch up contributions. And and so therefore, you can add an extra $1,000 above. So that helps you to create a faster retirement because the added amount you could put in and also remember the compound interest effect that is good for all of our retirement plans. So those are a couple key things and there there's a whole lot more. But again, I just wanted to the listeners to know some of these. Areas that they need to know in order to make a decision in regards to to getting a Roth IRA. Unlike a life insurance plan, with a life insurance plan, again, you will have the opportunity to add in a premium into that life insurance. There are no limits to that. So instead of six or 7000, if you wanted to do ten, 15, 20,000 into one of these plans on an annual basis, you would have that opportunity. And so obviously that would help you create a larger bucket per say as far as retirement income. And so that's there's going to be a huge advantage there, but there's nothing to say that you can't do both at the same time. So, you know, always think of multiple sources of income in retirement.

Matt McClure:
Yeah, definitely don't don't have all of the eggs in one basket, as it were. Now, we've been talking a lot so far in the show at about risk. And this is sort of brings me to I want to go into a little bit more detail on some particular kinds of risk that we've sort of touched on. But I want to go into that in a moment. But first, what I want to do here is throw it to our good friend and overall all around good guy, Ford Stokes. He's the one who wrote the book Annuity 3060. And just listen to a little bit about what he has to say from the book about reducing risk in your portfolio with annuities. We're we'll take a listen to that and then we'll come back. We'll talk more about bond risk in particular and some other types of risk that you can avoid with a fixed indexed annuity. Just right after we listen to Ford from Annuity 360, this is Chapter 16 of the book.

Speaker4:
Reduce Risk in your portfolio with annuities. Big Idea and annuity can protect against several risks that can affect retirees and pre-retirees and offer a better financial safety net than other investment types. One of the biggest benefits of investing in annuities is reducing risk in your portfolio. With current market volatility, pre-retirees and retirees are more concerned than ever about their retirement funds and protecting their hard earned wealth. We believe that annuities can be the answer to risks in your portfolio. Longevity risk retirees and pre-retirees are concerned about outliving their wealth. We have offered some strategies in this book that will stretch your retirement funds, such as following the 4% rule. But annuities can offer even more protection against this fear. We are living longer, so it is important to plan for at least three decades of retirement. An annuity can help create an income you can never outlive. Your money will last for your entire retirement by utilizing monthly, quarterly or yearly distributions from your annuity account after your money grows during the accumulation phase, market risk fixed index annuities can protect you from market risk. These annuities are not actually invested in the market. They are only tied to a specific market index. This means that you enjoy all the benefits of your market index when it performs well, but you are not exposed to any of the market risks. Should your index perform poorly, you will either make money or remain flat. You will never lose any money. Zero is your hero. Inflation risk annuities can offer riders that can help you adjust for inflation, even though a rider might reduce your payout.

Speaker4:
Protecting yourself from inflation will ensure that your money lasts and is not exposed to any unnecessary risk. It is important to have an annuity with a payout linked to the Consumer Price Index or CPI instead of one that increases at a fixed rate each year. To ensure you are protected against inflation risk. An annuity that increases at a flat rate each year does not offer sufficient protection against inflation. Sequence of return risk. An annuity with a lifetime withdrawal benefit can counteract the effects of a down market. At the start of your retirement research conducted by Retire, one has shown that you can flip 15 years of returns from retiring during a recession to retiring during a market that is up and completely changed your retirement outlook. The positive returns would offset your withdrawals and grow your assets before your account felt the effects of a negative return. Consider a smart, safe plan with a smart, safe plan. Your money is invested not in the market. The characteristics of investing not in the market include growth with safety market upside limited to no downside principal and gains protection low cost 0 to 1% annual fee time horizon of 7 to 14 years can earn 5 to 7% annually. Options are available. For guaranteed income. Here are some examples of not in the market investing bank CDs. The annual percentage yield RPI is about 1 to 2%. Your time horizon is typically 1 to 3 years and you cannot access the funds until the contract is up.

Speaker4:
Treasuries, the APY is about 3%. Your time horizon is ten years and you cannot access the funds until the ten years is up. Fixed annuities the annual percentage yield is between three and 4%. Your time horizon is typically 4 to 7 years. You are able to access the funds during the contract period. Multi year guaranteed annuities or minus. You get between two and 4% growth on your principal depending on the duration of your policy. This is less growth than a fixed indexed annuity, but it is guaranteed the annuity company is required to pay you the rate they promised for the duration of your policy. Fixed indexed annuities you receive between five and 7% growth on your principal. The time horizon is 7 to 14 years and you do have access to the funds in your account if you need them. A smart, safe plan does not invest your money directly in the market. Your investment is tied to an index without being invested directly in it. This means that you get a portion of the market gains without the market risk. You may want to consider investing in a fixed indexed annuity over other not in the market options. If you invest in Treasuries or CDs, you will lose ground in your investment due to inflation. Investing in a fixed index annuity will likely cut down on your inflation risk. We prefer accumulation annuities because they minimize your risk in several areas and they lock in your gains through the use of point to point protection periods, meaning you won't lose money.

Matt McClure:
And that was from the book Annuity 360 by Ford Stokes. Reduce Risk In Your Portfolio with annuities and annuities. One of the one of the things we've been talking about and especially with regard to reducing risk and it's it's an important way to keep in mind reducing that risk because there is so much market volatility right now.

Ed Cruz:
Yeah. And, you know, just like we said about fixed indexed annuities, there are or annuities in general, there are many different types. You know, bonds are under that same umbrella. You have US Treasury bonds, you have Treasury inflation protected bonds, which by the way, I've recently heard some of these bonds were actually paying about 9 to 10%. But again, that's only during a high period of inflation. Prior to this, you were lucky if you're getting one, one and one half percent. And the overall bond market was just underperforming at at about two and one half, 2 to 2 and a half percent. So not a lot of interest. Again, you have corporate bonds. You have we could just get into a plethora of of these of names of all these bonds. But the bottom line is, you know, with with when we're talking about risk and associated risk and bonds, you have systematic risk. You have the market risk. You have interest rate risk. You have political risk. You have. Business risk. We could just keep going down the line. You know, our dollar, the, the, the way it fluctuates, it creates a currency risk on on these bonds. So why get yourself into so much risk, so much unknown paying fees for a security that doesn't really return much back to you.

Ed Cruz:
The the common sense solution here and it's been said over and over now and there are plenty of white papers to support. And back this up is an phia fixed indexed annuity. We're participating in the market and people say, well, doesn't that go through all these risk as well? The answer is, is no. And simply because, again, what I mentioned earlier, whenever you have a fixed indexed annuity, we know that your principal is 100% guaranteed and protected. We know that all gains are also protected and a bond will not react in the same fashion. So again, if anyone out there wants to hold on bonds, I'm not telling you to unload them. But there is a better solution out there, and that's a fixed indexed annuity, which will allow you to get a reasonable rate of return on average. It'll protect your dollars. It'll provide you with a guaranteed income. It'll give you deferral if it's if it's not qualified money. And it will also help you eliminate advisory fees that these that these brokers are charging you.

Matt McClure:
Yeah. And that sort of leads me into, you know, the people who you know, who exactly is it that that those who should be working with an insurance professional like yourself and a professional professional, rather, in annuities like yourself, people who are, you know, looking to have these types of returns maybe that are sort of market like returns, right? But but that are not subject to the same kind of risk that being invested in the stock or bond markets could be.

Ed Cruz:
Yeah. People that come to me, I could say from the experience and people that are sent to me because I do receive a ton of referrals on an annual basis. When people get laid off of work, they say, Go see Ed Crews. When when people are changing jobs, friends of mine, they say, Hey, Ed, what can I do with this money if you're looking to retire soon? If you're already retired, there's really no reason not to contact someone like myself to get a second opinion. Just like you would go to a doctor for a second opinion. Why wouldn't you go to a financial person for a second opinion? The biggest mistake we can make is just following one path, one path alone. We know that that doesn't always lead to success. You know, there are bumps in the road and you want to avoid some of those, you know, right now during this turbulent time. Should you lose 50% of your assets? How long will it take to regain that? If we go back to 2007, 2008, when people lost, let's say on average, 38, 38 and a half percent. It took people five, six, seven years to regain their assets. And I actually know an individual still work with him, but he's never seen his his portfolio grow back to where it was at the height in 2006. So, you know, when people say it always comes back. Well, not really. And how many people lost a majority of their assets during that period? You know, we could lead into housing. We'll leave that for another day. But we know it's not true that it always rises. It was really only in recent history that housing has gone the way it has. So when we look at investments in general, we want to diversify. We want to learn more. We want to we want to have other ideas because being stuck in one area or one way of thinking, it's not going to be helpful to you in the long run.

Matt McClure:
Yeah, that that is, I think, something that's very important and sometimes overlooked because I think people when they when they think about investing or in in their retirement, they think of probably one of two things, and that is the stock market or bond market, and they think about Social Security. But in the end, that that those can be two pieces of the puzzle. But they're there there's a much larger puzzle out there. And you're not necessarily going to see the whole picture or benefit from the whole picture if you're only looking at part of it.

Ed Cruz:
That's right. And speaking to the topic of Social Security, you know, it's it's like a chair with with one leg. Right. If we just have one income or think one way, that's not going to be you're not going to be on unstable ground there. Right. You need to have additional legs to that chair. You know, and right now, Social Security is under intense attack. In fact, I just read a report earlier today talking about how each person's Social Security could be underfunded by a lifetime amount of up to 200,000. Doesn't that mean that we're going to have to at some point change the payouts on Social Security? We're going to have to reduce Social Security in order for it not to go under. And if that doesn't concern you and move you to do something in addition to Social Security and just thinking that that's going to take care of you in the future, I don't know what's going to motivate you, but Social Security is unstable at this point, and we must have multiple sources. And pensions are a thing of the past, so we can't really even depend on pension.

Ed Cruz:
And if you have a rental income, if you have a41k, that you're going to convert into some sort of income stream. If you have additional savings, which you should, whether it's at the bank or individual retirement accounts that that you have taken, taken charge of, you just need to start thinking of how can I create multiple sources of income in retirement? Because if we don't get there, we're going to be left like some of those people. We look back and say, boy, how do they survive just on Social Security? We don't want to be there. We don't want to go there. And the sooner you start, the easier it's going to be because it's it's a saving as a thing of habit. And if you don't get yourself in the habit of setting aside, start with 5%, bump it up to ten in the future. But if you don't get into some sort of habit, you will be in trouble in the future because. Make up for it once you're in your later years. It's very difficult.

Matt McClure:
Yeah, you're absolutely right about that because you don't want to, in my sort of mode of thinking and you're the expert here, obviously, but kind of in my mode of thinking is it's not ever necessarily too early to start planning, but it can be too late. You know, you don't want to just wait and wait and wait and then be caught with with your hands tied behind your back and only be able to do so much. The more prepared you are as soon as possible, the better.

Ed Cruz:
Well, absolutely. You know, I deal obviously with many families and many personalities. And, you know, it's funny, I run into while speaking to, let's say, the parents that are in their seventies, their kids are in their forties and fifties. And you have that different thinking, you know, the one that says, yes, I've been saving since since I was 20 or 30 years old, and I come to find out they're worth $1,000,000, million and a half dollars. Then I have the other guy that says, well, I was just kind of enjoying life and now I'm trying hard. And just recently I sat down with one of these with one of these clients and and, you know, he told me, I've waited too long, haven't I? And I said, Well, there's still hope. You know, he has a decent income, but now I'm telling him what he needs to do in order to catch up and get to the situation that he's telling me he wants to be in and the mountains pretty steep. I think he can do it, but now he really needs to sacrifice. Whereas had you started earlier, the sacrifice isn't all that much.

Matt McClure:
Yeah, it's absolutely very true. And a lot of people who come to you, I'm sure, for financial and insurance advice are people who are, as we've talked about, you know, tired of riding that roller coaster ride of the stock market. They want to safeguard a lot of their money. And there are also people who and we mention the word insurance here because, you know, annuities are an insurance product and there are people who are also looking to purchase life insurance. And that's one of those only two types of tax free investments that we talked about a little earlier.

Ed Cruz:
Yeah, you know, I get that from time to time. People hear, hey, I heard through the grapevine here that that I'm able to get a tax free income through life insurance. Is that true, Ed? And I tell them absolutely it is. There's a commitment because it's unlike having an IRA where you can make that commitment when you're ready to make that commitment with a life insurance plan, obviously you're a little more committed to a monthly or quarterly or annual payment. But if you if you set aside those assets and get yourself a life insurance plan with the idea of having tax free income, what I will say to those people is that they will need to give it some time. This is any time you invest, it's not something that you want to think that you can just go in for three, four or five years and and your investment is set. You know, like anything, compound interest is important to the to that investment. And so when you're dealing with a life plan, you definitely want to have at least a ten year timeline so that you that product actually matures to a degree, so that you can so that you just don't start pulling income out of it and collapse the plan. So it's important that you sit down with someone that's going to be honest with you, because I see too many plans out there where people make these offerings, they make all these guarantees, but don't tell them what the stipulations are.

Ed Cruz:
So whenever doing, whenever you do one of these plans, I will say be observant of whatever the cost are inside of that plan. The charges, the rate of return and get multiple illustrations don't just settle for four for one for one illustration that somebody shows you and it looks rosy. Get multiple illustrations, try to see where maybe one went wrong or or y one is just overinflated. In this world of of of indexes inside of these products, you have to know what will work, what won't work. A lot of them do just use the standard S&P 500, know what their what their comp history looks like, what their participation rate history looks like. You don't want to get into a plan that offers you 90% participation rate in the S&P 500 and come to find out five years later that they're that their participation rate has now been dropped down to 50 40%. Know the history. And if you cover your bases, if you ask all the right questions, you will have a successful retirement plan.

Matt McClure:
There you go. Knowledge is power and so is working with the right financial and insurance professional to help you plan your retirement. This is Prosperity Principles with Edwin Cruz. I'm Matt McClure here alongside Ed Crews, who is, of course of the Prosperity Financial Group. My Prosperity Team dot is the website. The phone number once again, 3862285769. If you would like more information or to speak with Ed and hear more about a lot of the things that we've been talking about, about how you can plan for a successful retirement. And of course, you're offering up something for free. And I just want to like if this wasn't radio, I'd hold up a big neon sign that said free stuff right here ad for for our listeners. What are you offering them?

Ed Cruz:
Absolutely. We're offering the annuity 360. Learn all you need to know about annuities. And this will also help you decide which ones are right for you, what's wrong for you, what to avoid. Just like I said about life insurance, fixed indexed annuities, you can go down that same path with companies that, just as I tend to look at it, don't respect their their consumers. And we need to get to a point where we trust each other. If we if we can't trust each other, we shouldn't be committed to each other. So, you know, I've been doing this far too long. And trust is key issue. If you're if you're going to hire me to do a job for you, I'll do a fantastic job for you. But you have to take some of my advice as well. Right. It's it's difficult when you deal with people that seem to think they know more than you because maybe they've had some other experiences, but those may have been some bad experiences. I'm here to bring you a positive experience. And this book is going to help you tremendously.

Matt McClure:
Yeah, very, very educational. Can lay a good foundation for a lot of great conversations and some great financial planning with you. And what we're going to do right now, though, take a quick break and we're going to come back on the other side. And what I want to do here is we've talked some in the early part of the show about inflation and just, you know, kind of the ways. And we also talked about the heat. So this is going to be perfect for for this next little portion of the show here, because I actually recently spoke with someone talking about an expert in the energy markets, talking about how increasing energy prices, coupled with all the heat that we've got that we're experiencing really across the country, not only in central Florida, I know you guys are kind of used to it, but we're kind of used to it here in Georgia, too. But, you know, we've got the high temperatures and we've got those high energy prices and how that's all kind of coming together in a little bit of a perfect storm. We'll listen to that here during this quick break.

Matt McClure:
We'll come back. We'll talk about that on the other side. And then we'll talk more about how people can cut some costs during times of high inflation like this. Once again, this is Prosperity Principles. I'm Matt McClure here alongside the man of the hour, as I like to call him, Ed Kruse with Prosperity Financial. We'll be right back. On the other side of this break, this is Prosperity Principles. My Prosperity team, once again is the website. Town's day, the heat is likely not the only thing making you sweat this summer. I'm Matt McClure with the Retirement Radio Network powered by Emera Life. With energy prices soaring and record breaking heat waves across the country. The cost of cooling your home could set you back a pretty penny this year. The Wall Street Journal reports the average American household will pay $540 in electricity bills during the summer months, up $90 from a year ago. An air conditioning can make up a big chunk of that total, especially in hotter and more humid areas of the country. Sarah Baldwin is with the think tank Energy Innovation.

Sarah Baldwin:
Because we have a confluence of factors, the increased price for both gas and oil, as well as natural gas in homes and buildings, and an extremely hot summer and likely to be record heat all over the country as well as the world, largely due to climate change. We're feeling the pressures on both sides, but if.

Matt McClure:
You think there's nothing you can do to ease the pain, you'd be wrong. Baldwin says there are some things you can do that will cost you only a little, if anything at all.

Sarah Baldwin:
Paying attention to when you're turning on appliances, when you're turning on the AC. If you have a thermostat that you can program setting that thermostat to a modest temperature instead of going straight to really, really cold, looking at what kind of window coverings you have.

Matt McClure:
Other improvements may be a bit more costly.

Sarah Baldwin:
Update your air conditioner to the most efficient unit. A heat pump. Air conditioner is going to be your best bet. You can also look at replacing windows and doors. Those can be a bit more costly but can have huge benefits in the long term.

Matt McClure:
And don't overlook your power company. It could have some programs or incentives to help you cut back on energy use and save yourself some money in the long term. Baldwin says renewable energy is the way to go since prices are much less volatile than things like oil and gas.

Sarah Baldwin:
The sun, the wind, geothermal, hydroelectric, other carbon free sources like nuclear are all generally very cost stable relative to their more volatile and spiking fossil fuel counterparts.

Matt McClure:
So how will you survive the summer heat and its impact on your wallet as you plan for retirement? That's a key question to consider as the mercury and inflation keep going up with the retirement radio network powered by a marine life. I'm Matt McClure. 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.

Matt McClure:
You're listening to Prosperity Principles to schedule your free no obligation consultation visit my prosperity team dot com.

Matt McClure:
Welcome back to Prosperity Principles with Edwin Cruz of Prosperity Financial. I'm Matt McClure here alongside Ed Cruz. And and you just heard their kind of how a few different things are really affecting inflation right now. You know, of course we've have energy prices which have been soaring lately and they've they've kind of really been a driving factor of a lot of the inflation that we've seen overall. But then, you know, you couple with that these hot temperatures, you know, I was, you know, kind of floored by just this sort of kind of percentage increase in the Wall Street Wall Street Journal story that I quoted there, where the average American household is going to pay about 540 bucks in electricity bills during the summer months, and that's up $90 from a year ago. That's a big chunk of of that 540 total that you're seeing as far as this year's increase. And, you know, air conditioning is is not necessarily the biggest energy saver in your home. So that can make up a big chunk of your electric bill during this time of year.

Ed Cruz:
Yeah. And, you know, I mean, I'll go a step further. I read a report from the Labor Department about two or three days ago, and they said that all of this inflation, all of the high cost of everything at this point, food, energy, you name it, the average family is going to spend an additional 50 $500 a year. Again, that's painful, especially for people that are on fixed incomes. It's just it's it's too much for some to bear. We'll probably see additional problems. It's the domino effect from from all this. And and the problem is I don't think that what we've seen so far, I don't think we're at the peak yet. And that's that's the sad way to look at it. You know, people who are retired or looking to retire, you really just can't afford to deal with this at this time. How do you prepare for those unknowns? That's a big problem. Again, if you're looking to retire and you have and you have these issues, obviously the one thing that you need to shore up is that guaranteed income. That's obviously one of our strengths and that's what most people need right now. And that's what we're here to do. We're here to help in whatever your biggest pressing issue is, right.

Matt McClure:
And right now, of course, everybody dealing with inflation and trying to figure out not only how to plan for the future in the midst of inflation, but also kind of how to make it day to day right now with trying to cut costs. You know, the woman that I spoke with there a moment ago was talking about how, you know, setting your thermostat, getting a programmable thermostat, things like that, because we're talking specifically about air conditioning. There are some other things I think that you can do, though. And we were looking at those and kind of a a little bit of a cost cutter of the week, kind of a mini segment here. But one of those things that that could help you save a little money. And as a matter of fact, I've had some loved ones who've recently retired and or, you know, the husband died, that kind of a thing, and have been looking to to downsize some things to save money because they don't necessarily need the big house anymore or don't necessarily need two cars anymore, that kind of thing. So downsizing your house and or your vehicles could be something if that might work for you. That could be a strategy that you could use to kind of cut back on costs and save some to make up for what's going out the window with inflation right now.

Ed Cruz:
Yeah, absolutely. In fact, what you just mentioned, cost cutting. I'm dealing with two clients right now that are going through exactly this. One of them, they they sold their home. That was about 2000 square foot down to about 1200 square feet. They had two vehicles. They're down to one. And so obviously, that's one less insurance, less maintenance on a vehicle. Their their cost for the home. And it isn't a 55 plus community. This this this helps them to maintain a level of independence. This helps them with the activities that they want to do instead of having to go out and drive. They're in their own community doing these things. So so they're not having to put that much more gas in their vehicle. In fact, they've cut down on their on their fuel, they tell me, by about two thirds, which is quite substantial, especially at $5 a gallon. So making these making these choices, downsizing the way that these people are doing. The other client, she's moving in with her sister. You know, her husband passed away about nine months ago. We've been talking about how best to consolidate. And her final decision is she's moving down to South Florida with her sister and and she'll be helping her because even though she receives Social Security, she has a pension and she does have income from an annuity.

Ed Cruz:
There are multiple factors there. She was in a very expensive community. And so with her sister being in another community, that's I wouldn't say cheap to say the least. Down in the West Palm Beach area, they kind of figure that moving in together, having their assets together, their income together, that they can obviously continue to enjoy more of that financial freedom by by living together. So people are finding ways to do this. But most don't want to give up that privacy. Most don't want to give up that independence. And so most people have to think a little harder on what they want to do going forward to cut down on their expenses. It's not easy to cut back on expenses when you get used to a certain style lifestyle. It's just not simple going backwards. So, you know, my heart goes out to to those people, but we do have solutions to help you.

Matt McClure:
And once again, that goes back to why it's important to talk with someone who is an expert in these things and can can really help you make those decisions that are difficult ones because, you know, these are not easy things to to deal with. And, you know, you want to know all of your options and you want to know the ways that are the right solutions for you. Because as I said earlier, not one size fits all in the least. We'll just just hear about about 5 minutes or so from the end of the show here, Ed, but I wanted to cover a couple of ways. You know, we've been talking about inflation. We've been talking about the different options that you have because of inflation, because of interest rate hikes, because of all of these different things that markets have been really volatile the way that you can have a secure and safe retirement. But I wanted to bring up just a few things here before we go about how to live comfortably during retirement, no matter how much you're able to save. Right. There are a few tips that we have here for for our listeners. And let's just kind of run through these in our last few minutes. The first one here, it has to do with with housing, right. And kind of what we were just talking about and, you know, making sure that you are not house poor, I guess, in other words.

Ed Cruz:
Right. You know, when you own a home, there's something called the mortgage that comes along with it for most people. And the one thing that you don't want to do going into retirement is have is having a mortgage payment. Now, eliminating a mortgage payment. Does it mean that it's all gone? Right, because tied into that is your homeowner's insurance and your property taxes. And for some people, some HOA fees and the list can go on. But if if you eliminate that mortgage, that would be more than likely in most cases, about two thirds of that that you will have in retirement. So so that's that's obviously one of the one of the ways to to live comfortably during retirement.

Matt McClure:
Yeah. And the other way that that's very closely related to that here is, you know, banking that money that you save from having zero mortgage payments and then investing what you save each month. And that way you have more. Money to you. That's there when you need it.

Ed Cruz:
Right. And, you know, some people say to me, okay, I have finished paying off my mortgage. What should I do now with with these assets they're building up in the in the bank. And the first thing I ask them is, what type of return are you getting at the bank? And of course, everyone out there knows that you're going to be receiving about 1/10 to 2 to 5 tenths interest at the bank. And that's not even keeping pace with inflation during low inflation.

Matt McClure:
Especially not right now.

Ed Cruz:
Especially not right now. So obviously, the one thing that you want to do is, is here the options that are out there, you might be able to get four, four or 5% rate for five years. If you want something short term. Or you might be able to average six, seven, 8% per year using one of our strategies. So depending on what it is that your needs are and your outlook is and what you're using that money for or what to use it for in the future, you know, we can help customize a plan for you.

Matt McClure:
Yeah, absolutely. And so many other things. And as a matter of fact, I want to I want to just sort of put a bookmark there as a as kind of a tease for for our next show, because we're going to talk a lot more about ways that people can live comfortably during retirement as the shows and the weeks go along here. But that, I think, is a good place for us to kind of begin wrapping things up for this week's particular show. But it has been an absolute pleasure to spend the last just about hour now with you and and kind of, you know, hearing all about things that people can do really to build that safe and secure income stream for their retirement. It doesn't have to be a gamble. As we said in the beginning here. There can be ways that that you can really have a secure retirement and you all can can help them with it at Prosperity Financial. Talk a little bit more, just as in the last minute of the show here at about how people can get in touch with you and what your first kind of conversation is going to be like with them.

Ed Cruz:
Absolutely. Well, the one thing I will tell everyone out there is that there are benefits to working with you. If you're looking for again, if you're looking for that safety, if you're looking to sleep better at night, we can help you. If you're if you're looking for that tax deferral, we can help you there. There are many things that we can enlighten you with. And remember when you call in. We do have the Annuity 360 book that will help you to learn all you need to know about annuities. And I thank you for the time here today as well.

Matt McClure:
Yeah, thank you so much. I really appreciate you and all of your advice and the time that you've spent with us and our listeners here. My Prosperity Team. Com is the website folks and that number to call for that free copy of annuity 360 is 3862285769 that's 3862285769. This is Prosperity Principles. Ed Kruse is your host. I'm Matt McClure, editor. Have yourself a great rest of the weekend and we'll see you next time.

Ed Cruz:
Thank you, Matt, and everyone out there listening.

Matt McClure:
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 my Prosperity Team dot com or pick up the phone and call 3862285769. That's 3862285769.

Matt McClure:
It's 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 married 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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