We spend more time deciding about other things than we do on our financial future. Undeniably, we’re less confident in this aspect because the system lacks in providing enough credible information that allows people to make the right financial decisions. This is why education is so important. Joe, David, Karen, and Brett lay down all the existing workshops that Thrive Financial Success is doing. They advocate the importance of getting yourself educated by sharing what people need to know about finance, be that retirement income, taxes, social security, plan for health care and health benefits. They stressed that the first important thing in talking about your benefits is making sure you have the most up-to-date information. Together with Fran and Jim of Del-Val Insurance, they also discuss some of the common mistakes people often make when thinking about insurance.

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Listen to the podcast here:

[smart_track_player url=\”https://soundcloud.com/livewiththrive/wpht-02182018\” title=\”Let\’s Talk Health Benefits\” ]

Let\’s Talk Health Benefits

Bret Elam is here, David and Karen Bezar as well. David, what was an unbelievable not only for this radio station but for Thrive Financial Services participating in the first USO Radiothon?

Joe, I had a wonderful time down there. It was great to see how many people participated. All the sponsors and the radio stations did a spectacular job of coordinating everything. To see that first year there, over $100,000 raised for the USO. Karen was on the radio and talked a little bit about our personal story related to the USO.

It was great for everybody involved. If I can take a quick moment to salute the radio station for throwing all of their assets, all of their personalities, the entire day to do something unbelievable for the USO. Nice job by Thrive Financial Services as well for getting involved. We\’re going to begin our program and lay out what our workshops looked like. I thought we’d have an opportunity that we have some additional time built into the program tonight to do that. Let\’s start that first. Bret, how are you?

I\’m glad to be back here.

Karen, it’s nice to have you here as well.

Thank you. I\’m glad to be here.

Throughout this episode, we will spend some time reminding our listeners about the workshops. We spend a lot of time, David, talking about the workshops. The more I learned about the workshops, the more intrigued I become about the dynamic of the audience. About the information that is covered. About all of the conversations that occur not only during the workshop but also after the workshop.

Joe, we think the workshops are as successful as they are because of our commitment to being authentic about advocacy and education. We don\’t discuss any products. We don\’t discuss any specific concepts or strategies. We try to educate our audience. The growth of those audiences is exciting to see. Karen was commenting because one of the things that we do at these workshops is we offer complimentary consultations. We consider them continuing education. I\’m sure as you can imagine, we couldn\’t answer every single question that could potentially pop up at one of these workshops. For a couple reasons, just time constraint. On top of it, we don\’t want to get too personal. There might be something specific to somebody that asks the question that we’ve got to go a little bit more granular, a little bit deeper to get that answered.

[bctt tweet=\”It’s not always what you make and save, but it’s what you get to keep after taxes.\” username=\”\”]

What we do is we offer these complimentary, continuing education consultations where folks can come into the office. Zero pressure, no selling whatsoever and that\’s part of our mandate because of our affiliation with that organization called the Society of Financial Awareness, a national 501(c)(3). Part of their mandate is that there can\’t be any selling. It\’s purely education-based. We offer these consultations. They\’re one hour long. There’s no pressure. It\’s all about conversation. People can come in. They bring their information and questions that they have. If they would like us to run the analysis, there are four different types of reports that we can run for the people who attend. One is a Social Security Maximization Report. Do we try to help people understand what’s the best way to get their Social Security benefits? How to maximize the benefit?

They can get a Tax Clarity map done, which is how to be efficient in retirement. It\’s not always what you make and save, but it\’s what you get to keep after taxation. What are the strategies to distribute your income in the most tax-efficient way? We do a Money Tree and that\’s a report where we look at the overall retirement. We look at all the different types of stressors or disruptors that could potentially happen and try to give a passing grade to the retirement.

If they get a green light, it means everything\’s great, 100% probability. A yellow light’s probably in that 50% or 60% probability and a red light is in that 30% and below probability. If they\’re not coming in at 100%, we can discuss different ways. Lastly, we do this Riskalyze. That consultation’s awesome. We love doing them. The impact is strong. The results that we hear from people, “I love that idea you gave to me. I used it.” That\’s a real tester too, Joe, is we hear feedback. People keep calling us. It\’s a really fun time for us.

 

One of the interesting dynamics about the workshop and about the individuals that you connect with at the workshops, they are as individual as the individual people. There are no scenarios that are the same. There may be some similarities, but each story has to be told a completely different way based on the on the information you\’re getting.

Let me kick it over to Karen. As we were driving here, we were talking about we’re at that stage in our marriage where we talk about business. We drove around doing our errands, we’re like, “What else is there to do?” “Let\’s talk about business.” Karen was telling me about some of the different people that she met from the workshop related to Social Security specifically. She could give you a great idea of some of those different scenarios you\’re talking about.

I love doing our complimentary consultations. I enjoy meeting different types of people. Everybody that comes in, they have a little bit of hesitancy. I usually call them to remind them about their appointments. I stress it is complimentary. Sometimes when they bring all their information, they set up a time to come back and see us a second time. They say, “How much is it going to cost us to meet with you again?” Honestly, we are not going to charge you anything, just your time. When I meet people, some people come in and they think, “I don\’t have enough money for retirement.” They might not. They\’re also afraid to come in and talk to us because they\’re almost embarrassed that they don\’t have enough money saved for retirement.

I met with a lovely couple. He has a pension coming to him. He knew he had Social Security. They had some money saved, but they were concerned about their future. When they left they felt a little bit more confident because the wife never worked, she never had a job. Her Social Security income that she was going to receive was going to be a pittance according to them. She did not realize she could collect half of her husband\’s Social Security income, and that made such a difference in their future.

It was between night and day the amounts of money that she was going to get versus what she thought she was going to get. They need to be informed about that. A lot of times there are single women out there and their Social Security income is greatly affected. Women more than men, they usually get lower Social Security checks because they are not the breadwinner normally. They stay home. They take care of the children. Their Social Security income sometimes is lower.

Our good friends from Del-Val Insurance will be in the studio. We\’ll introduce you to Del-Val. We\’ll bring them into the dialogue. We\’ve been talking about Del-Val and we\’re going to finally introduce Del-Val to our audience.

[bctt tweet=\”I sometimes wonder if we’re smart enough to know what we don’t know.\” username=\”\”]

Joe, what we wanted to do is take a peek into what we do at some of these workshops.

That\’s something we\’ve never done before.

I would tell you it certainly doesn\’t replace the experience, but we\’ll want to hit the topics. We want to talk about the different things. I wanted to let our audience know that at our events, these are the different topics that we cover. We cover understanding your monthly benefit, the amount that you\’re going to receive, how to calculate, where to look for it. We talk about managing the impact of taxes related to Social Security. If people decide to keep working in retirement, maybe they\’ve retired but want to go back to work. We talk a little bit about that.

We talk about Social Security in past marriages. We talk about protecting the surviving spouse. We talk about the cost of living adjustments. We talked about Medicare. We talk about strategies to maximize your lifetime benefit. We also talked about filling the retirement income gap, “Do I have enough? If I don\’t, what do I do? If I have too much, what do I do?” Last but most importantly, is taking a look at all those pieces in there and how you fit them together. I\’m going to let Bret start to go through some of these different topics and give people some highlights.

Krause, when we first started rolling out these workshops it was the Summer of ‘15. We kept on going through this with the Social Security plan. It was common knowledge for us, but seeing the a-ha moments on our clients faces after we went through those strategies of how to maximize those benefits. That’s where David, Karen and I said, “We need to take this show on the road from that education advocacy approach of teaching it to individuals out there.” There\’s a recent report that came out when they got rid of a lot of these “unintended loopholes” with Social Security back in 2015 because the upper affluent were the only ones that were taken advantage of it. It\’s not true. It\’s why we kicked things off in 2015 just educating everybody and anybody and understanding how inputting all those different puzzle pieces together.

 

We went out there and we have a group of agents that work with us that we make sure that they\’re certified. It\’s called NSSAA, which stands for National Social Security Advisors Association. All of our agents are certified to have the most up to date information and knowledge to all of these changes that do happen to Social Security. You feel that you should be able to turn to the government when you sit down with them. In their mandate says, “Please give the people that are in front of you enough information to make an informed decision, but do not give advice.” Think about the liability that\’s hanging out there if the government is out there giving financial advice to 300 million Americans out there. It’s not going to happen. It\’s their job simply to throw information.

Some of them feel like they\’re doing a good deed, but sometimes they\’re not. When we give our clients a clear direction to go in there and someone says, “No, you don\’t want to do that.” It goes along in circles. When we start talking about Social Security, it can be confusing especially with some of those rules that had changed out there. Especially when you\’re sitting down with a financial advisor, you think you\’d get that information, whether I\’m working with the government or my financial advisor to get that help. Krause, 22% of financial advisors describe themselves out there as knowledgeable about Social Security. In now\’s day and age when we talked about the volatility in the market over the past, when you\’re working with a financial advisor, number one, make sure they\’re a fiduciary. Number two, can they help me out with something other than just my investments?

We talk about all the time about putting the pieces of the plan together between investments. Investments are important, but how does it work hand-in-hand with that retirement income distribution strategy, taxes, the plan for health care, and then inevitably talking about that legacy plan. We\’re going to dive deep a little bit and talking about Social Security. David talked about the different reports that we have out there. We\’re going to talk about some of those key dates and ages when it comes to Social Security.

The first important thing in talking about your benefits is making sure you have the most up-to-date information. Social Security has a couple acronyms out there. The first one called PIA, which simply stands for your Primary Insurance Amount. It’s simply is the fancy way of saying, “This is how much you\’re going to get at these certain points in time.” Typically, we get them about two or three months before our birthday tells us how much we\’re going to receive at age 62.

[bctt tweet=\”The system is not providing enough information out there to give people the right decisions.\” username=\”\”]

Do people know the answer to that when they come to the workshop? Karen\’s ringing in the back of my mind already because I sometimes wonder if we\’re smart enough to know what we don\’t know. Every time I complete the show, I realize how much I don\’t know.

Many times, when we\’re sitting down with people, sometimes we take things for granted. We slow down and we pride ourselves in talking about layman\’s terms because people are like, “I don\’t know what to ask.” We try to bring anything and everything that\’s relevant. Hopefully creating that environment that people feel comfortable to ask us what they may feel may be a “stupid question.” Where we create that environment where there are no stupid questions. It\’s finding out information is power, knowledge is power. It’s putting all those different puzzle pieces together. The most important thing when we talk about your benefit is to make sure you have the most updated information. A lot of people think, “I\’m not retiring tomorrow,” it goes into the trash.

Many times when David, Karen and I sit down with people, they might bring in Social Security statements from 2014, 2013. Simply going on www.SSA.gov, your free registration so you can get in there and get your information. The most important thing when we talk about your Social Security amount is having the most up to date information.

Why is that, David? Why would somebody come into the workshop with information that\’s two years old? Doesn\’t it become a priority?

It\’s complacency that happens.

 

We\’re all guilty of it.

You hear the old adage. People spend more time planning a two-week vacation than they do their whole financial future. One of the interesting facts that we cover in the workshop, and it goes back to the question you asked is people are uninformed. Over 50% of the Baby Boomer population that takes Social Security takes it at the earliest possible age, then ends up having a permanent discount, and could have cashflowed a whole lot more. We want to try to get to people with these Maximization Reports as quickly as possible so we can prevent that from happening.

Krause, when we talk about the second part of the equation and figure out how to maximize my benefits. First, one is making sure I have the most up to date information. What\’s my primary insurance amount? That primary insurance amount simply comes from what are my earnings from my highest 35 years of reported income? It\’s adjusted for inflation. The second acronym that Social Security uses is called FRA, which simply stands for full retirement age. Way back when Social Security started full retirement age was age 65. For most of our people that we\’re getting in front of, people born between 1943 and 1954, full retirement age is age 66.

If you\’re born past the age of 1954, you see that full retirement age starts moving every two months. For example, in 1955, people that turned 62 last year, the full retirement age was 66 and two months. 1956, so people that turned 62 this year, the full retirement age is 66 and four months, all the way out to people born 1960 thereafter, full retirement age is age 67. What you realize, Krause is every year we can always defer all the way out to age 70. For this episode, we\’re going to assume that full retirement age is age 66.

Karen, let me ask you the example that you used of the couple in their 60s.

Yes, 61 and almost 62.

On the curve, 61, 62, they’re on the curve of preparing to get ready?

Yes, they have to make their decision. They\’ve got to start figuring out.

What we find when we start talking about some of these loopholes that got changed is its predicate. Can I still take advantage of them or not? That\’s dictated by what was my date of birth. Krause, the earliest age as David said, 50% of people take that benefit at age 62. When we sit down with people, it\’s talking about making sure that we\’re making rational decisions, not emotional decisions. Especially when we talk about pensions and we talk about Social Security, we’ve got one chance essentially to make those decisions. We need to make sure that we\’re making the right decisions actuarially. We have a couple ages 65, a 50% chance that one of them is going to make it to the age of 95. You may be spending as much time if not longer in retirement than you did during your working years. These are these decisions that we\’re making in our 50s and 60s are one-time decisions that we\’re going to have to live with for the rest of our life.

[bctt tweet=\”It’s tough to get a right advice when you’re dealing with a computer.\” username=\”\”]

David, when you hear that statistic that 50% plus uninformed, is that an indication that people are making 50% of the people in this space are making mistakes that are going to work against them?

Definitely, and it\’s a lack of education. The system is not providing enough information out there, enough credible information to give people the right decisions. If you had assets and you had other sources of income that would allow you to defer Social Security so that you could not have that permanent discount, why wouldn\’t you do it? When you see the facts and the figures, it becomes math. Math is an exact science. One plus one equals two all the time. When we look at that type of stuff, we want to point those out. Sometimes people think they need it. They haven\’t done their cashflow analysis.

Paychecks don\’t come with instructions. After we don\’t have paychecks, obviously the playbook’s gone. That\’s typically the biggest trepidation that people have is this shift in the mentality of, “What am I going to do? I\’m used to getting this paycheck every two weeks. I\’m used to getting this. I\’m used to getting that.” That\’s why we want them to take a big breath. Calm down a little bit. Let\’s get the facts and figures on paper. Let us show you how it works. Let\’s make a decision based on all the facts versus some of the facts.

We outline workshops and the information that is covered, David, in those workshops. It\’s a really good inside look for our audience, perhaps those who have considered coming to a workshop. Not sure what to expect when they get there. This provides a really nice snapshot of how they will be engaged when they get there.

We wanted to pull back the curtain a little bit so people can get a sense and don\’t have that, “What am I going to go show up at? What are these guys going to try to sell me? What am I going to be put?” It\’s such a relaxed environment. It\’s all education. We have a good time doing it too.

You mentioned a little earlier that you and David decided to bring this show on the road to get out there. You\’re doing a lot of great consistency. At least two workshops scheduled every week.

We have a team of people in addition to that. Taxes In Retirement, all these new changes at 2018 Tax Code. Krause, David was talking about you can never get a second opinion from the same person who gave you the first. A lot of people that we meet during these workshops are coming in for that. A lot of people already have an advisor when we meet them. I\’m seeing seven fingers being held up. It looks our first three Social Security reports people have already called in to get those reports. If you\’ve never gone through the exercise of getting that Social Security Maximization Report or if you\’ve dealt with an advisor says, “We need to take your Social Security right away.”

Please understand that advisors make money on the more money that they\’re holding onto. There may be a reason they\’re telling you to take Social Security right away so that they can manage more of your money. As David said, if you have that bucket of money, there may be that reason that you may want to delay Social Security and utilize some of those assets. If you\’ve heard that from your advisor or you\’ve never taken the step to at least interpret how Social Security Maximization Report works against many people do that report. However, they have no idea what it all means. It\’s like living in a vacuum that\’s out there. We take the time and interpret it, and say what makes sense given your particular situation. If you\’ve never taken that exercise, we invite you. You can visit us at ThriveFinancialServices.com.

[bctt tweet=\”It’s amazing to know how much information we are expected to know that we’ll never know.\” username=\”\”]

Spend a little bit of time talking about Social Security in past marriages. The numbers are out there. 50% of marriages end up in divorce. We meet people all the time that are divorcees and/or widowed or widowers. When the rule changed, the closure of unintended loopholes back in November of 2015, remember it passed in the middle of the night. We had a workshop the next morning. It was like, “We need to figure out all these changes so we can communicate it here.” One of the big things that changed is that you were grandfathered into a lot of these loopholes, so long as you turned 62 years old by January 2nd of 2016.

If you are of that age, if you are younger, you can\’t necessarily take advantage of this strategy that I\’m speaking about. How it works is Social Security in past marriages. Let\’s say I\’m divorced. Here are the criteria when I\’m talking about a divorce is. Am I able to collect a benefit off of ex-spouse’s work history? There are a couple of criteria that have to exist. Number one, that marriage had to have lasted for ten consecutive years. You and your ex-spouse must be over the age of 62. You\’re currently unmarried. This is a big one. Your divorce has to be final for at least two years. Long as that is the case, you were 62 before January of 16. You have the ability to do what they call is a restricted application.

 

Krause, let me put that into fruition what all that means. Let\’s say I am Jane Doe. I am divorced and I hit all that criteria. Let\’s say I may have stayed at home with the kids and John was working all those years. My benefit may not be as high as what John\’s was or what John\’s is. When I hit the age of 66 years old, I can go in there, meaning client go into Social Security and file for benefits of what they call is a restricted application. Let\’s say it was my benefit, Jane\’s benefit. Let\’s say my benefit at my age, 66, was going to be $1,600. Instead of collecting that $1,600, I could claim what they call is a restricted application to claim my spousal benefits only. What that means is I would be able to collect, if John was getting the max benefit of approximately, let\’s call it $2,700 to make the math easy. I could get 50% of John\’s benefit.

If I was a married person, the same thing applies to those dates of birth. I get to be able to get 50% of what John\’s benefit would have been. That means $1,350. Instead of me collecting $1,600 now on my own benefit, I\’m going to collect that $1,350. Every year that I\’m delaying my own benefit, that\’s going to continue to grow at a guaranteed 8%. When they\’re closing unintended loopholes, those are things that we\’re going to want to take advantage of. That\’s the importance of the educational and the advocacy workshops that we have out there. At every workshop we go to, there’s at least one person that we find that is entitled to Social Security benefits that they have no idea what that is available to them.

In that example, $1,350, they\’re able to collect that for four years. At age 70, instead of collecting that $1,600 benefit, they\’re then able to switch to their own benefit. Let\’s say $2,500, $2,600. Conventional wisdom says I go into Social Security. I go collect my $1,600. If you have the ability, and we see it all the time, people retire and go down the Social Security Administration Office. I said, “How long ago did you do that?” They said, “Two months ago.” “You need to go rewind that.” “What do you mean? I\’m getting a higher benefit.” You\’re getting a higher benefit today, but you\’re going to get even a higher benefit at age 70. If you have not taken the time to get that Social Security Maximization Report, please call us. We\’d love to sit down and go through that retirement income strategy.

David, we’ve been talking, bringing our audience into the world of what the workshop is about and what to expect. Bret was providing some good detailed information. It is amazing to me how much information we are expected to know that we\’ll never know.

Joe, that last little piece that Bret was covering was a mouthful. A lot of calculations, a lot of knowledge about which is happening, when it’s happening, that\’s what we try to stress to people is you don\’t want to be left on your own to make those decisions. That\’s what the software does. There are 567 different possible combinations of how to take Social Security. We want to try to figure that out. I’ll tell you one thing that\’s interesting, Joe. I want to make sure our audience understands this. These workshops that we do are for everybody. We see people who have struggled a little bit to accumulate the amount of money to get them the type of retirement that they want.

We have seen people that have enormous net wealth, and I\’m talking $15 million, $18 million, $20 million and they come in for the consultations. We\’re always a little curious. We ask two questions. Why? The answer to that is, “I worked my whole life. I worked 35, I worked 40 and I worked for 50 years. I want to make sure I get every single penny that\’s owed to me from Social Security.” That\’s valid. I don\’t care if you\’ve got $15 million, $20 million. If you owed it, find it out.

The second one is interesting too is that they said, “We asked our existing advisor and they basically told us to call Social Security because they\’d understand how it worked.” That does blow us away a little bit. It\’s such a crucial part of a retirement decision. Retirement isn’t just about how much money you have. It\’s how all the pieces fit together, taxation, longevity, legacy planning, cashflow and all those different things. I want to stress that you might not think you have enough. Come on out. You might think you have a lot. Come on out. You\’re going to find out.

When you do, you\’re going to have the ability, from what I can gather to take the information that would apply to your own situation. From that be able to either expand or say, “Let me come into the Thrive Financial offices. Let me sit down with Karen. Let me sit down and start to figure out the game plan. Start to figure out the next step in the conversation.”

At least get the information to make a valid decision rather than guessing through the process. Get the facts. I tell people all the time, “If you\’re going to make a mistake, you want it to be a big mistake or a little mistake. I want to make a little mistake.” Come to spend an hour with us and find out that you were spot on in your decision-making so you wasted an hour. If you don\’t come in, you don\’t find out the information, you end up taking Social Security too early and losing out. Joe, we have seen as high as $200,000 of additional benefit paid to someone who had an analysis done over their lifetime. Instead of the path that they were going to take, they took the advice of the report with our explanation and that\’s an extra $200,000. Joe, you know what I say? I say, “Every extra $200,000 in retirement helps.” Would you agree?

[bctt tweet=\”In the appetite of doing something quickly, we tend to miss a step.\” username=\”\”]

I agree. We\’ll play that sound bite many times because it\’s super important to drive home. We\’ve talked much, David, about Thrive Financial Services, about being local, about being an advocate. The partners that we have collected and that have been part of this partnership all share in your mind, certainly in mine, a vision of advocacy. I\’m going to give you the opportunity to introduce our friends from Del-Val Insurance who are joining us. The one common thread from both who are joining us here, they fit into your definition of why you wake up every day, why you do what you do. I commend you for it.

We\’ve been deliberate. When we started the show, we talked about building this tribe. The tribe was our teammates, our partners, but also our audience. We want our audience to be part of this education and advocacy to learn one, do one, teach one. If the message gets out, we could have a lot of impact on a lot of different people. When we teamed up with Fran and Jim, it was instant synergy. They come from a common mold. They\’re passionate about what they do. Incredibly educated on what they do. What sank up specifically was the advocacy. They want to help people make the right decisions with the things that they do financially.

These are good guys. We\’ve already experienced in a short time some amazing results for a lot of the clients that we\’ve already introduced them to. Joe, things that will blow you away, it\’s like, “How can you do that?” Fran and Jim, Del-Val Insurance Group based up in Southampton. They cover the whole Tri-state area. They\’re enthusiastic. We want to introduce them as our strategic partner. They\’re doing a wonderful job. I\’m going to turn it over to Fran and Jim a little bit. Let them tell us a little bit about Del-Val. I’ll come back in a little bit and tell us about some personal experience.

A pretty good introduction from a gentleman who stands by the principle of advocacy.

David, thank you for that nice introduction. Our company, Del-Val, we\’ve been in business for about fifteen years. One of the things that we do is we do the shopping for our clients. We have dozens of A-plus carriers that we use. When you call us, basically we are going to do the shopping for you. We make sure that the coverages are right. That ties into a little bit what Thrive does. Your financial situation should also be a part of your decision making when purchasing auto, home, umbrella, your business insurance. You have to make sure that you have the correct liability. You don\’t want to have a liability limit of $50,000 and you\’re protecting assets that are $200,000, $300,000, $400,000. What is the common goal is, is to bring our customer the right products at the right price? That’s the most important thing.

Would you say that that would be potentially a common mistake that somebody would make because they don\’t know?

A lot of times there are common mistakes that people don\’t know. Insurance can be complicated at times. We try and simplify it and go over coverages line-by-line so that people understand what bodily injury it is. Even when it comes to the homeowner, some of those mistakes that people make is they don\’t realize that flooding is not covered, water backup, earthquake insurance. There are things that can be added to a policy, but a lot of people are not aware. We try and not only to bring the right price, but we also try and educate the client.

Jim, let me ask you to join us into that conversation. I sometimes feel as though in the space of insurance and in that complicated world. Which has many reasons for us in our lives in different areas, as Fran mentioned, technology becomes not necessarily our friend. In the appetite of doing something quickly, we miss a step or we miss a detail.

That’s right, Krause. First, I want to say thank you. Fran and I are excited to have the power of Talk Radio 1210 and Thrive Financial behind us. We’re excited about this partnership.

We’re thrilled to have you. We’ve been talking and promoting about the partnership. For what we do, where this radio program fits within the audience, advocacy is the number one priority above any anything else. The ability to look out for the best interest of the audience ranks up there, right as a bull’s eye, number one.

You talk about the advocacy and touching on your earlier question. In now’s day and age, a lot of people are trying to do things easy, especially Millennials. They do everything online. It\’s tough to get the right advice when you\’re dealing with a computer, as opposed to sitting in front of somebody that has experience. We had been around fifteen years, but we each have over 30 years’ experience in this business. We know what we\’re doing. We do it well. You can go online, you can call an 800 number, but are you getting the right advice? Are they pointing out the deficiencies in your coverage and giving you the proper choices to make a proper decision?

Joe, one of the things that I’ve recognized and being in this business for 30 years and talking to people about all aspects of their finances. What you don\’t know can hurt you. A lot of times, what ends up happening, insurance is for those got you’s, those what if\’s and those uh-oh’s that occur throughout life. Whatever type of insurance it may be. A lot of times, we find out about these coverages, the lack thereof when it\’s a little bit too late already.

In this day and age, relate it back to what you were saying with technology, people were quick to jump. Auto insurance, homeowner\’s insurance, business insurance, unfortunately, sometimes it looked like a commodity. You may get the best price. Price and value sometimes, it\’s going to cost you in the long run. I was talking to Jim, we\’re talking about a particular person that we made an introduction to. They had the minimum state coverages. Talk about what that could mean? What could potentially happen?

From a number standpoint, Pennsylvania requires to have at least $15,000 per person and $30,000 per accident for bodily injury liability. What that means is you rear-end somebody on the way home from work, you injure that person, your insurance company\’s only going to cover you for $15,000. If that person\’s injured, they\’re probably not going to be happy with $15,000 if they\’re going to be disabled for a lifetime. That person can then come after you personally for what they want to receive in compensation.

There\’s a big problem there. If you have $500,000 in the bank, you have $15,000 in liability coverage. It\’s easily and fairly inexpensively correct with proper liability coverage, maybe an umbrella policy. It\’s easy. What we do is quite simple. I know David we\’ve worked on some numbers for you. The process is quite simple. You provide us with some basic information. We run numbers for you and we get back to you. All you need to do is call us at (215) 354-0122 or you can log on to www.DVIGI.com. We need some basic information. We’ll run numbers and more times than not, we\’re going to be able to help you.

Fran, what’s that look like? How long before you get back to somebody? What are the typical situations that you are experiencing the same?

A typical situation, if someone calls us and they happen to have the renewals and information in front of us, where we can gather that information over the phone. We can usually turn that around in a couple of hours. The other thing is that we track records of customers and referrals that we get. We find that in almost 70% of the cases, we are able to not only make sure the clients have the correct coverage, but we will also lower price 15%, 20%, 30% or more. We have the ability to shop dozens of carriers. Just because a company has a multimillion-dollar advertising campaign and you see them on TV, it doesn\’t always mean that\’s the best price or the best coverage.

 

That fits right back in, David, to the advocacy part of why this show exists. When I hear 70% of the audience can potentially save that significant money, and then you take that one step further. You put that into the equation or into the blender of our conversation. It\’s all about the ability to make the right decision. It’s important to do it. I\’m thrilled to have Del-Val Insurance as one of the partners for the show. That advocacy part for me, Fran and Jim, will go a long way in terms of changing the lives of people that we\’ll never know. We may never know them, but we’ll help change their lives.

Joe, you know how deliberate we are about protecting our clients, our audience about who we introduce them to. We want to make sure that they carry that same code of ethics, integrity, and transparency. Act as a fiduciary in the situation and really do what\’s best for the people that we\’re serving. I want to encourage our audience because here\’s what we see. We have a lot of clients, especially Baby Boomers in retirement. Physics sometimes takes over. The old physics rule of a body at rest tends to stay at rest. Unfortunately, a lot of times that\’s not the experience with these guys because I know how they operate.

We usually don\’t hear from our auto and homeowners or property and casualty advisor as often as we probably want to. I knew that was the case for us. We had to reach out to our agent and start inquiring about coverages. Adding drivers. My sixteen-year-old is driving, she\’s almost seventeen. My 21-year-old got a new car. We started talking and then when Karen and I looked, we were spending $13,000, which bothers me. $13,000 a year between our auto insurance, our homeowner\’s insurance, and our umbrella liability policy. I hooked up with Fran and Jim and got them what they needed. What came back?

It was over $3,000 in savings. That\’s $250 a month in savings on insurance. That bothers me that I didn\’t have an assertive, an aggressive, an advocate working on my behalf to say, “Dave, Karen, I might be able to save you $250 a month.” When we started talking, I was like, “If we\’re going to be in business together, I want to see what you can definitely do,” and they delivered. $250 a month is $250 a month.

As I stand here, I am almost embarrassed to say that I probably fall into the same category, only I haven\’t done anything about it yet. I’ve got four kids. I’ve got three drivers. I’ve got the house.

One thing I wanted to bring up. I know this is a situation with your business that when your clients call, they\’re going to talk to you. When they call Del-Val insurance, they\’re going to talk to Fran or I. You\’re going to get a person that has a lot of experience, knows what they\’re doing and is going to do the best job for you.

Even after we make the sale, we stay with the clients. We do annual reviews. We’re involved in the claim process. I don\’t want my customer to call the company. I want them to call me. We\’ll discuss the claim. We\’ll talk about it. I want to be their advocate. We don\’t represent a company. We represent our clients.

Jim Muelbronner and Fran Salerno joining us. You\’ll hear a lot about Del-Val Insurance. I ask you again to go to the website if that\’s the first place that you would like to start. I leave you with Fran’s reference to 70% of those individuals from around the Delaware Valley that have reached out to Del-Val Insurance group, 70% of the people that have done that included, saved money.

We saved money. It\’s that simple.

Fran and Jim from the Del-Val Insurance Group, one of the partners and part of this tribe, Bret, we are building to aid, to help and to provide great information, resources, and assets for the audience. It came across well, with the personal example from David of how Jim and Fran were able to jump onboard. Be able to jump in and be able to do some really significant savings based on the fact that they learned the information.

David, Karen and I were always careful. When we partner up with somebody. When we met these gentlemen and they continued that whole education advocacy thought. When we sit down with people, we educate them about life insurance, disability insurance, cancer insurance, all the what-ifs in life. You\’re more likely to have something happen to your house or to your car. The fact that these guys dive deep, it\’s not always the cheapest price always wins. It\’s making sure we have those right coverages. What\’s Limited Tort versus Full Tort and umbrella policies? We\’re excited to have these guys on board and what they\’ve been able to do for us and our clients in a short period of time. We\’d love to dive deep a little bit and have these guys talk about some of the other cases that we\’ve been already able to put together.

In addition to David\’s case, which I was thrilled that that worked out because here we are with the principle of Thrive Financial able to help him. That was a great start. Some of the recent referrals we\’ve dealt with were a family in South Jersey. They had two or three cars, kids driving, a house and an umbrella policy. This particular client had all the proper coverages. He happened to be paying way too much. When we ran our rates for him, we were able to save him almost $3,000 like David. He was paying a pretty good premium. Still, saving $3,000, it\’s at least a 30% savings in that case.

Jim, what would cause that steep of a premium?

Joe, it\’s usually one or two things. A lot of times it can be a poor claim history or this person\’s getting surcharged a lot. In this particular case, that wasn\’t it. It was that he had been with a particular carrier for a really long time, never had it reviewed. What happens a lot of times is those renewal rates go up. A lot of these carriers when they bring out new rates, they offer them to new clients coming in. A cable company would be a good example. The people coming in new are getting a better rate than the people that have been there for a long time, which doesn\’t seem right.

Fran, I don\’t know if this is an accurate statement. You can say yes or no if it is or it isn\’t. We get complacent. We buy a policy. The policy\’s in place. We don\’t have any reason to check the policy other than we know it\’s going to either automatically renew and we don\’t pay any attention to that detail.

That\’s true. A lot of times when you\’re with certain carriers, I would call them captive agents. You\’re with a State Farm or you’re an Allstate. When a policy comes up for renewal, if you call that agent, unfortunately they can\’t shop you. They can change your coverages, lower or higher deductibles. Where the advantage we have is because we\’re not beholden to one company. We can re-shop you again at renewal amongst all our carriers. We\’re always working to try and get the client the best price and the best coverage.

The other thing we didn\’t mention much is we also do commercial insurance. If you have a small business, you can be an artisan contractor or you can be a company that has 100 employees. We have a commercial department. We\’re working with one. In fact, we got a good lead from Thrive on a pool company that we\’re working with. It looks like we\’re going to be able to save them a substantial amount of money. It\’s a pretty nice contract. Not only do we do the residential that we do and the personal lines we do the commercial. All you have to do is call us at (215) 354-0122. Jim and I would be happy to speak to you.

Bret, I know it must be reassuring for you and certainly for David and Karen as well that when you extend a referral, that referral you know they\’re in good hands. They\’re being taken care of. The end result is going to be a positive experience for them that are going to produce additional savings for them.

It\’s our job as fiduciaries. When David, Karen and I sit down with people and go through. A lot of times we\’re meeting somebody for the first time, Krause. It\’s trying to identify what are the bullet holes that are out there in that plan and how do we fill them. We can go through that cashflow analysis and put a phenomenal plan together. Let\’s say you\’ve done a phenomenal job at saving for retirement. Let\’s say it\’s $750,000, $1.25 million, $1.5 million. We\’re using those assets as part of that income distribution plan. I\’m 73 years old and God forbid I rear-ended somebody and maybe it wasn\’t as devastating what it really is, but they found that I have assets. It\’s the importance of identifying all the different pieces of the puzzle. Property and casualty insurance are a critical piece of making sure that people have the coverages that they need.

 

In David\’s example, $250 a month is a significant amount of money. When you\’re putting together a pyramid and you\’re putting together a puzzle. You\’re working a plan for retirement and you\’re trying to understand where the buckets are. I know you talk a lot about buckets and how you\’re going to execute the utilization of those buckets. Those additional savings are worth much more than the value of savings on the surface.

It\’s leaving no rock on unturned in figuring out all those different pieces of the puzzle and putting it together. It\’s a critical piece. No one loves paying for insurance. You start thinking about all the dollars that are coming out of your pocket, paying for health insurance, auto insurance, homeowners’ insurance, disability insurance, and long-term care insurance. I can go on and on. These are critical things that they’re inevitable. It\’s making sure that if we\’re going to do it, we\’re going to do it properly and making sure it aligns with all the other puzzle pieces.

I encourage the audience around the Delaware Valley, call Del-Val Insurance. You don\’t know what you don\’t know.

Give us a call at our (215) 354-0122. We’d love to talk to you.

Jimmy thanks very much for coming in.

Thanks, Krause, it\’s always a pleasure to come downtown.

A special thanks to Fran and Jim from Del-Val Insurance for coming in. David, we spent a lot more time peeling back and giving our audience a chance to see or to feel what takes place at one of these workshops. They’re certainly filled with information. Yet that information becomes personalized based on your scenario.

We\’ll continue a little bit more with it to help people understand. We go through eleven topics on our Social Security Maximization workshops. We bring in taxation. We bring in Medicare. One of the big topics and I\’m going to kick it over to Karen. A little bit about not knowing, not planning or didn\’t know this or didn\’t know that. I also want to make sure we cover a little bit, and this is a big one, Joe. Is when the first spouse of a married couple passes away and the financial impact that brings related to taxes as well as Social Security.

I hope people stick in to read that one because that\’s an eye-opener. We get a lot of feedback and a lot of emotion. It\’s not something we want to think about obviously, but we have to plan for it. It\’s inevitable. Death and taxes, those two things we\’re going to go through during our lifetimes. Karen was doing one of these complimentary consultations with a couple where it was the husband, a Post Office worker. That\’s got some interesting complexities to it. I wanted Karen to share related to that.

If you don\’t know everything, do you want to make a big mistake or a little mistake? This couple we met at a workshop, they came in. He is retired from the Post Office. He worked for them a long time ago. He had the option of taking a pension, which meant at that point you didn\’t collect Social Security when you retired. You also didn\’t get Social Security taken out of your paycheck. You had money taken out for your pension when you retired. What they came to us for was a second opinion and Social Security Maximization Report.

He knew he wasn\’t collecting Social Security. What they didn\’t know and what they found out is his wife, who has about eight more years in the workforce, she will get Social Security. However, because of the deal that he made for his pension and with the Post Office a long time ago, if God forbid she passes away first, he does not get her Social Security check. That Social Security check is gone. Their advisor did not advise them of that information because he\’s not part of the 22% that understand Social Security.

When you hear that explained like that, that\’s a big pitfall in front of you.

People\’s eyes go wide open. It\’s like, “What do I do?” The decision\’s already been made. Alternative planning has to go into place to make sure that there isn\’t a deficit or isn\’t a gap in that income when she passes away if she were to pass away first. Bret does a wonderful job at the workshops explaining the impact of losing a spouse. We\’re not talking about the emotional side of it. It’s obviously devastating. Equally devastating on the financial side if you don\’t plan properly or don\’t understand how it can impact you, it could be a bad situation.

Bret, that can be an uneasy conversation but certainly a necessary one. We\’ve proved that and we\’ve established that. That doesn\’t necessarily make it any easier when you begin.

It\’s a simple question I started off with. There are only two inevitables in life. Those are death and taxes. During our tax workshops, we go deep into that. During both of our workshops, the Social Security and the Taxes In Retirement Workshops, we talk about what happens when the first one of us passes away. We started off earlier talking about divorcees, how Social Security fits there. When we talk about becoming a widow, widower, let\’s talk about that a little bit. I\’m going to read a couple of statistics here, Krause. More than half of elderly widows that is currently living in poverty were not poor before the death of their husbands and more than 70% of all elderly persons with incomes below the poverty line are women.

There are a couple of good answers as to why, but one good one. They outlive men. Actuarial tables. On average, upon the passing of a husband, a wife will outlive a husband on average six years. Remember what I started the show off with a little bit ago? If I have a couple age 65, there\’s a 50% chance, at least one of them will survive. Don\’t know which one, but a 50% chance at least one of them will make it to the age of 95. We need to make sure that we\’re making rational decisions, not emotional decisions when it comes to both pensions and Social Security. Here\’s a real-life example, we want to call them John or Jane again. Talk about the scenario and we ask this in the room.

When we\’re at these educational workshops, we get typically about 60% of the room. How many people are already taking or will be taking a pension in retirement? We see the hands go up in the room all the time. The follow-up question I said, “Please keep your hands up if you can tell me with absolute certainty exactly how your survivorship benefits work.” The good thing is about two-thirds of those hands stay up. The bad thing is one-third of those hands don\’t stay up. If we have George and Mary., let\’s say they\’re both collecting a pension.

They\’re both collecting Social Security. Let\’s say their household income coming in between those two sources a little less than $5,000 a month. They’ve got some assets in CDs and savings accounts. Obviously, they\’re not too high. Over the past, we’ve talked about all the volatility going out there in the market where they can\’t stomach that agita level that they put that money on the sideline where they still have a little bit of money left. Let’s say they have $50,000 and a little bit of a final expense insurance.

We have about $425,000 that they have and then we say, “What happens when George passes away?” George had that big pension versus Mary was about little more than $1,200 a month. Is that when George passes away, he took what they always were called a single life pension? When we go to retire and we\’re entitled to that pension, it\’s the biggest number that\’s popping off the chart saying, “This is how much money you\’re entitled to.” We don\’t look at the fine print. David always says, “What the big printeth give us, the small printeth taketh away.” It\’s understanding what comes with that biggest number that\’s out there. It says if you were to pass away, your surviving spouse gets nothing. In the case of that happening and understanding how Social Security works. How Social Security works upon the passing of the first spouse, the surviving spouse will always keep the greater of the two benefits. It goes hand-in-hand with that pension decision.

 

If my spouse chose that single life pension, I lost a pension payment. In addition to that, I\’m also going to lose the lower of the two Social Security payments. We make a joke, it\’s a bad joke. I call it a joke upfront before I say it here. We always say the good thing about being here in the great state of Pennsylvania, New Jersey or Delaware. Everybody in the in the Delaware Valley is aware of upon the passing of the first spouse, that property taxes get cut in half. It’s not true. There was my joke. I told you it was a joke upfront. Meaning upon the passing of the first spouse, your expenses don\’t get cut in half. In fact, we know property taxes go up. We always get in front of Mary. David, Karen and I, we sit in front of our clients and we say, “Retirement looks great.”

There\’s that awkward pause like we had right there until the first one of us passes away. What we need to realize is that when the first one of us passes away, we\’re no longer filing a joint tax return. We\’re filing a single tax return. I always tell the story about some clients has been with me from day one. As soon as I got out of college, seems like decades ago. Bill had passed away from Alzheimer\’s, being there for six years. If not properly structured, can be a devastating expense to one\’s a retirement future. A little over $12,000 a month for six years, you do the math on that. It’s a little less than $900,000 to one’s nest egg that can evaporate, again making sure that we\’re properly protected. He passed away after six years.

They chose the pension option, which was joint life. What happened was Carol had kept the pension check along with her pension check. Now they lost the lower of the two Social Security checks. We saw about a $2,000 drop in income. In addition to that, because we are no longer filing what they call that joint tax return, we\’re now filing a single tax return. We talked about that during some of our other shows, about the importance of getting that Tax Clarity map done so we can figure out how taxes are going to apply to me. We had to go take another 10% of the income. We had about $10,000 of income coming into the household. We lost two coming from Social Security. From the money that was left over, we lost another 10% to taxes.

In addition to that, what we find is Medicare surcharges. We haven\’t talked about that specifically on the show. In the importance, Krause, of having a plan for investments, income distribution, healthcare, taxation, and legacy. Not just focusing on the investment side of things. Is that between taxes, losing another 10% and understanding healthcare, healthcare surcharges on Medicare all of a sudden crept in for the first time ever? Why? Medicare surcharge level doesn\’t occur until $170,000 for a joint couple. As soon as the first person passes away, that number drops to $85,000. With all the changes to Medicare that happened in 2018, making it a lot easier to fall into these surcharges.

David, how does an individual, depending on when they arrive or depending on when they sit down for the conversation or the consultation, how do you get it all? There\’s so much. There are many different decisions that you can make that if you don\’t have an advocate, you can end up in the wrong place.

Joe, it\’s why when I start the workshops, I don\’t welcome people. I congratulate them. That you had enough initiative to leave the couch, get in your car, and drive down to a local library, community center, college campus. Sit for an hour and fifteen to an hour and 30 minutes and get yourself educated. Find out what questions I should be asking. What we don\’t know could hurt us. That\’s the start of the process. Our book, Roadmap To Navigating: Your Way To Peace Of Mind, has been doing phenomenal. The feedback that we\’re getting social media-wise and what people are responding to on it. All of this type of information, we went deep. We went into a lot of topics that we typically don\’t talk about. We hear people saying the same thing, “When I read the book, I understood it.”

For the first time since we started doing this program, it sounds like you would agree with me on this statement. We\’ve scratched the surface. We\’ve created some reasons why our audience should potentially call the 800 number or should go to one of the workshops. We’ve got below the surface.

The good part about it as fiduciaries, as veterans of the industry, of people who are passionate about what they do, we have the answers. I tell people this all the time when they\’re sitting with us. I say, “This may be your first time taking a dive in this deep. I get to do this 30 to 40 times a month. Your story\’s not new to me. I’ve heard it before. I’ve seen it before. Most importantly, I’ve got the answers on how to fix it, if it needs fixing.” There are times that people will come in and we literally pat them on the back. Give them a cookie. Wish them well and say, “You\’ve done a great job. If there\’s something that changes in the future and you need, don\’t hesitate. Give us a call.” That happens. It happens enough. It\’s good to see that there are people, the fact that they had it all together and still came out to a workshop. To make sure that it was rock solid. No stone unturned, no question left in, I applaud people like that.

[bctt tweet=\”What you don’t know can hurt you.\” username=\”\”]

Bret, our show was filled with some very detailed information.

Krause, we love getting on the radio, talking to the tribe, building the tribe and introducing great partners like Fran and Jim. We were fortunate to have in the studio with us here. I wanted to conclude our conversation again. We went deep talking about Social Security and making sure that you\’re protected. All of your puzzle pieces are protected with the help of Fran and Jim. When they ask you to say, “What do you do? Who are you? What do you guys do?” The typical answer that you get in our businesses is, “I\’m an insurance agent. I\’m a financial advisor. I\’m a retirement planner.” What does that mean? In our head, when you hear that name, there\’s that perceived notion of who that person is.

When we sit down with our clients or when people ask us this, here’s what we say, Krause, “WM = IC + RP + DS.” If you asked me, “What do you do?” and I told you that response, I\’d probably intrigue you a little bit. WM stands for Wealth Management. Wealth management equals IC, Investment Consulting. This is the typical answer, retirement planner or financial advisor. Realize that people in our business, 95% of them, that\’s all they do is investment consulting. That\’s one of the five plans. We always need to have a plan for investment management, but we talk about the other four plans that work in harmony with it.

What\’s my plan for income distribution? What\’s my plan for healthcare? What\’s my plan for taxes? What\’s my plan for legacy? We need to go beyond WM = IC. WM, Wealth Management, equals IC, Investment Consulting. The RP stands for Relationship Partnership. We say the key to any successful relationship that we have with our clients at Thrive can be described by one word. It\’s all about communication. It\’s great that the stock market goes up and down and we manage it. We\’re human beings. We\’re not robots at the end of the day. People\’s different has different agita level and how much risk they can watch that market going up and down.

We\’re looking for relationships and you have a partner in us. When we talk about DS, it talks about our Deep Support and our team that we have at Thrive. It\’s more than just David, Karen and I. It\’s important that we have a whole team that\’s working on your behalf. There are many times that we\’re sitting in front of people and it\’s why we encourage people to come in for that second opinion. Wealth management is more than investment consulting. Wealth management is investment consulting, but you also need to bring in that relationship partnership. Meaning with that communication and then having that deep support and trying to figure out how all those different puzzle pieces fit for me.

David, when I hear Thrive Financial Services and somebody asks me the question, “Who is Thrive?” Advocate is the word I use. I use it with confidence. I\’m proud to be able to say it. When I listen to a show like this, go back and listen to a show like this on the podcast and listen to some of the information that\’s being provided, I commend you for the philosophy and for the approach.

We appreciate that, Joe. One of the reasons we enjoy so much working with you as our cohost is we see the passion in your life, how you\’re an advocate. Everything that you do is out there to help people. The synergy that\’s made this show what it has so far and we have no idea where we\’re going in the future. We know it\’s going to be bigger and better. A lot of that is attributed to your passion. We enjoy spending that time with you.

Karen, I want to come to you for one last thought. Go back to the example of the story that it all started with a couple who came in. They weren\’t quite sure where the direction was going to go or where that conversation was going to lead. I have a feeling that\’s the story of your life in terms of the individuals that you meet. Helping those who you don\’t know, go on a journey.

I\’m not an Olympic athlete and I\’m not Nick Foles, I can\’t win the Super Bowl. If I can help somebody not make a mistake and that they can retire comfortably or more comfortably in the future, that\’s our Super Bowl. We love meeting new people. We love people that come in. We can say, “You did a great job.” Some people come in and they become clients. They want to meet with us on an annual basis. We want to let everybody know, we truly will meet with you the first time complementary. Give us a call if you have any questions. We\’ll be glad to answer them. You can always take it a step further, but we\’re not going to try to push anything on you or sell anything to you over the phone.

I leave you with the telephone number 1 (800) 516-5861. On behalf of our partners, Del-Val Insurance, who were with us, Jim and Fran, thank you so much. It was great to introduce you. On behalf of Bret, David, Karen and all of our readers, I\’m Joe Krause. See you next time.

Important Links:

• Society of Financial Awareness
• Money Tree
• Riskalyze
• Del-Val Insurance
• www.SSA.gov
• www.DVIGI.com
• Roadmap To Navigating: Your Way To Peace Of Mind