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This program is a prerecorded paid commercial announcement produced and paid for by Jacob Media Partners. No statements made during the Thrive Retirement Roadmap Radio Show shall constitute tax, legal, or accounting advice. You should consult your own legal or tax professional on any such matters. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investment, or investment strategies. Investments involve risk and, unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial advisor and/or tax professional before implementing any strategy discussed. David Bezar, Bret Elam, and Karen Bezar of Thrive Financial Services and Thrive Capital Management are licensed to offer investment advisory services through Thrive Capital Management, LLC, a Pennsylvania State registered investment advisor. Office headquarters located in Fort Washington and offices of convenience used exclusively for client meetings in Exton, Yardley, and Cherry Hill.
Joe Krause:
We come to you on a Saturday here on Talk Radio 1210 WPHT and we welcome you into Roadmap to Retirement, the Radio Show as we come to you from the Thrive Financial Services studios locally here in Fort Washington. Social distancing, the broadcast is set up in four corners of a room, so we\’re about 12 feet apart in each direction as we bring you the broadcast today, David, and I\’ll come right to you. COVID-19 alert in these extraordinary times, we are here for you, \”we\” being Thrive Financial Services. I almost feel as though I need to emphasize that right out of the box on the radio show.
David Bezar:
Yeah. Good morning, Joe. Good morning to our audience as well. In our pre-show planning, you could see there was a definite different air about what\’s going on out there and both, well, all of us really, Karen, Bret, and myself have been spending a lot of time on virtual appointments over the past couple of weeks.
David Bezar:
And I\’ll be straight with you and our audience. I have personally gotten to the point where, today\’s show is going to be probably the most critical show that our listening audience has ever heard from us. Because what I\’m seeing out there in the investing public is a avoidance, a kind of an approach of \”let me wait and see what happens,\” and people are not necessarily at a point of complete understanding how severe this potential pandemic financial crisis is going to be for the United States. This is not fearmongering. I think we\’ve had, over the two plus years we\’ve been this show, I don\’t think there is anybody in the general public that can accuse us of being fearmongers trying to play on the emotions and all that. We try to advocate, we try to educate, we try to bring enough information as fiduciaries for the listening audience to get some guidance and assistance in making good financial decisions.
David Bezar:
But through these conversations, Joe, over the past couple of weeks, I think short-term memories, long-term memories, whatever you want to call it, have gone to the wayside and people are so caught up in other things that there\’s a dislocation of understanding what\’s really happening to the financial markets. And we see these bumps in the markets where they go up, and they go up with no rational reasoning behind it, and we\’re going to talk a lot about that today, Joe.
Joe Krause:
A really, really good show today. Also, during the show, during the one-hour broadcast, we\’re going to emphasize two webinars coming up next week that you can get registered for. Bret, the webinars are filled with information. I have a feeling that the webinars are adjusting just as the days and the hours are adjusting, but it\’s a great 70 minutes of information that people can watch from the comfort of their home. I can\’t encourage enough for them to do it.
Bret Elam:
Yeah, and it\’s emphasizing just the things that we\’ve really been echoing here on 1210 over the past year, of why they\’re so important and why we need to act upon them. Again, David said when people do nothing you are making a decision. You\’re staying in the market at the end of the day. So it\’s kind of talking about, I want to talk about some of the conversations I\’ve had over the last week, and then just some of the headlines that are out there as well, Krause [inaudible 00:05:52] echoing what David just shared a moment ago and some of the concerns that I have out there, because everybody has an opinion at the end of the day. And again, you do not get a do-over when it comes to retirement so just talking about, again, unprecedented times where we\’re at today, so just talking about some things that we can be proactive with what\’s out there and just some of these conversations that we\’re having out there today and just not wanting to make a mistake, Krause.
Joe Krause:
Just a quick follow-up on that. Sharing conversations mean we can learn. People have questions. We can learn from other scenarios in terms of trying to formulate it into ours.
Bret Elam:
I\’m going to call it Informal Collaboration, if you will, Krause.
Joe Krause:
I like that, it\’s good [inaudible 00:06:31].
Bret Elam:
[inaudible 00:06:31] I\’m going to have to patent that one. It sounded good [inaudible 00:06:33] that\’s what it is. I mean, we win and learn. You never win and lose; we win and learn. And when we see mistakes, and hopefully people can avoid those next mistakes or those mistakes we see from other people, again, it\’s just sharing the message and saying, \”Hey, I never thought about that.\” And again, things like Medicare surcharges and doing rough conversions and just all those things that we\’ve talked about. And again, they\’re just that much more important today and they need to be acted upon. Now\’s not a time to be an ostrich and putting the head in the sand, Krause.
Joe Krause:
Well done, well said. Way down in the other corner of the room but still in vision is Karen Bezar. We missed you last week but it\’s nice to have you back. You\’re going to talk about another one of those changes that has come out of all of this conversation. I know in the pre-show you were talking about $100,000 and your 401(k). That\’s a conversation, I remember Bret referenced it last week, you\’re going to talk more about it.
Karen Bezar:
Just go a little bit more into detail and just like Bret said and David said, there\’s pitfalls out there, and there\’s information and we\’re getting half the information and it depends on who you\’re listening to. It\’s so confusing out there so I just want to kind of give some details. And it\’s nice to see you, nice to see a different face.
David Bezar:
I don\’t even know how to respond to that, Joe.
Karen Bezar:
We\’re still keeping to that 12-foot distance that David talks about.
David Bezar:
I think it just went to 24 feet.
Karen Bezar:
But yeah, I wasn\’t here last week but it\’s because we\’re busy and trying to keep mentally sane.
Joe Krause:
No, I get it, I understand. But the one thing I hope the audience does take away from the program, David, and I\’ll give you last word before we get into the commercial break, is there\’s so much information that is out there for retirement, for decisions you\’re supposed to make. There\’s confusion, there\’s uncertainty, there\’s this speculation of what to do, what I don\’t know, what I should do, all of that is out there. How can you cut through the clutter to get that, to deliver the message?
David Bezar:
It\’s probably the most difficult thing for the listening audience to come up with. I would say one of the things is consistency. Our country is incredibly divided, and it\’s divided on so many aspects of things, and I would say at the top of the heap is the political divisiveness that\’s out there. So that\’s what ends up happening, is people tend to follow now, for whatever… they start following financial perspective from a political side and it just, that\’s something you definitely just want to disconnect. You can\’t be basing your future decisions on your retirement.
David Bezar:
We have to remember clearly you\’ve only got one shot to get that retirement right; you don\’t get a do-over. So I would say it\’s a matter of finding somebody who has been consistent in their message, who seems to be knowledgeable, who is absolutely a fiduciary. I think that\’s the best type of source to go to. If people want to experiment a little bit in the sense of hearing a new voice, I would highly suggest getting on our webinar that we\’re doing. We\’re doing them weekly. It is absolutely evolving, Joe, from the day one that we did it. It\’s very different, it\’s very different. Because things are changing. So we\’re adding, we\’re subtracting what we think is the most critical things that can help people make good, quality decisions.
David Bezar:
So go to our website at thrivefinancialservices.tyl16lnm-liquidwebsites.com. Right there on the front page you\’ll see a pop-up give you two options: one is to register directly for our webinars; the second is to register directly for a 15-minute consultation, kind of a retirement rescue conversation where we\’ll answer questions. I mean, it\’s that simple. You can register, you can talk to one of us or one of our very qualified financial planners, and help you through that process.
Joe Krause:
Yeah, very good news, and I will talk about that again when we come back after the commercial break. Thrivefinancialservices.com is where you go. How to navigate the COVID-19 crisis and what you can do right now is a good way to segue-way into our commercial break. Back on the other side here on Talk Radio 1210 WPHT.
Speaker 1:
David, Karen, and Bret will return after the break. And remember, if you want to connect or have a question, send a text to (267) 870-8210.
Joe Krause:
And back here on Roadmap to Retirement, the Radio Show. Thank you so much for tuning in on this Saturday. We appreciate you being here listening, and what we would like you to do is sign up for the webinar coming up next week. Bret, as David mentioned going into the break, the webinars are evolving, let me transition over to you and turn over the microphone. I\’m going to sit in silence, I don\’t want to take too much of your time, but thank you so much.
Bret Elam:
Yeah, Krause, I wanted to talk about just the volatile times. Last week was, I guess, the week before, not the week that we just went through, but the previous week was the largest gain that we had seen in the stock market in a very long time. So now all of a sudden emotion\’s starting to creep back in, Krause. And today, we\’re going to keep the theme up of rational versus emotional, et cetera.
Bret Elam:
So March 23rd, the market hit the bottom, S&P, the Dow. Since then, the market has come back 30% in almost three weeks. So now you\’re getting people with buyer\’s remorse saying, \”I can\’t believe I got out of the market. What\’s going on here?\” There\’s volatile times. Now, you can\’t control… David last week talked about the stimulus package that was introduced that kind of propped the economy up, and now all of a sudden it\’s earnings season. It\’s earnings season. So earlier in the week we saw gains and, again, we are up 30+%. And now you\’re saying, \”Oh, my friend said I should have just stayed in and just ride it out\” [inaudible 00:12:52] David was talking about that a little bit ago. That is a decision. You\’re staying, stay in. If you\’re not sure what to do, get on the sideline and figure out what to do at the end of the day.
Bret Elam:
Here\’s some of the sentiment, some of the headlines that are out there. So earnings season, it\’s starting to become doom and gloom. So I\’m going to talk about Bank of America, they just threw out a bunch of research here recently and I just want to share a couple things, talking about extreme investor pessimism. My concern right now, Krause, is we\’re hearing it on the other side: \”Oh, let\’s go back into the market.\” Realize, you ready? Here are some of these numbers. Right now is the highest cash levels, 5.9% of assets under management since 9/11. 9/11, okay? There\’s number one, highest cash levels ever. When we start looking at 93% of investors believe a recession is going to happen in two thousand… remember, \”recession\” means it goes down and stays down, so this isn\’t there yet. You ready? And just 15% of investors believe it\’s going to go down and bounce back up. They call that a V versus a U. Well, a lot of people are believing the U, meaning the shape of U, it\’s going to stay lower for a longer period of time before it goes back up.
Bret Elam:
And the firm\’s bull/bear sentiment indicator came out to 0.0. In layman\’s terms, let\’s talk about what that means. The firm basically couldn\’t find anyone that had a bull market sentiment out there and they believed, in essence, that a deep, prolonged recession is now a consensus. In addition to that, the IMF came out last night and they\’re talking about post-pandemic stimulus. Not just the stimulus that we have right now, but what they believe that we\’re going to see not only as a globe, as the world, but as a country as well, they believe global GDP is set to drop 3% around the world and they\’re expecting at least around a 6% drop in the United States.
Bret Elam:
Everything\’s sounding positive out here. Like, did it take for people to wait til earnings season to actually believe that earnings were going to go down? And then all of a sudden you\’re starting to see it\’s coming into the middle of the week and now all of a sudden things are starting to turn, whether it\’s Jamie Dimon from Chase or [inaudible 00:15:16] you\’ve got Bank of America. I mean, you had mortgage applications obviously way down, manufacturing numbers way down, when you\’re talking about deep, long, prolonged recessions.
Bret Elam:
And then we get people that come in and when we talk to them virtually through that Thrive Retirement Roadmap [inaudible 00:15:33] like, \”Let\’s go back in,\” it\’s like, \”What are you reading? What are you watching?\” Like, I get it. And again, it\’s a little bit of remorse that they feel like that they just missed these gigantic swings back into the market with 30% ups. But you\’re seeing that gigantic volatility and again, you heard 30% up, that sounds like a gigantic number, but remember that 30% up was still 20% down. Again, people playing with numbers. Again, what are the agendas people are getting across?
Bret Elam:
So let me tell you a story that I had earlier this past week, Krause. I had a young lady come in, she said that she was conservative. So I\’m going to be talking about risk lies a little bit here, Krause. One of the tools that we chat about all the time, it describes risk tolerance. So we sent her a questionnaire and it came back as a 32 on a risk rating from 1 to 100. So, relatively conservative at the end of the day, which a lot of people that we sit with, when they\’re more chronologically mature, are of that same tolerance.
Bret Elam:
Now, when we entered her portfolio, including the cash in the bank and the CDs that she has in the banks as well, her overall risk rating was a 53. So there was some divergence between her portfolio and what was her sick-stomach feeling as it related to the market. And when we identified that to her [inaudible 00:16:59] said, \”It can\’t be. I\’m conservative.\” I go, \”What do you mean?\” She goes, \”Well, when I was working with my advisor, I talked about all the heartache that I felt in 2008 and I didn\’t want to go through it again and so they said, \’Okay, we\’ll put you into something that\’s more conservative.\’\” But what you found was with that advisor, where there wasn\’t an active relationship, what had happened over the past years [inaudible 00:17:20] the past seven to eight years, there was nobody keeping an eye on the portfolio, there was no rebalancing in the portfolio. Again, it was almost the ostrich approach of just \”set it and forget it.\”
Bret Elam:
Now that we\’re finally experiencing the first big downtown in the market, again, we saw one at the end of \’18 but this is a lot worse than that. And then when I shared with her the stress test of what she would go through as if she went through another major crisis, now, again, the past six weeks [inaudible 00:17:53] like a heck of a crisis but it bounced back up so all of a sudden people feel warm and fuzzy again. \”Let\’s go back into the market. What are we waiting for?\” What are we waiting for? I\’m waiting for a clear way just to get back into the conservative government short-term bonds where that market got unraveled. Like, if that market\’s not even stable, what the heck is at the end of the day?
Bret Elam:
So I shared with her what a stress test is and I showed with her what it meant on the long term. And this is a healthy, she was 72 years old, a healthy 72-year-old, so not like on the verge of dying any time soon. And I showed her [inaudible 00:18:29] a recession, a bear market, whatever you want to call it, a major correction happens every eight to 12 years. And David, Karen, and I, we\’ve been chatting about this. If, and this is a gigantic if, now you heard Bank of America, there\’s not one person believing it\’s going to go back up and stay. But David and Karen and I have been talking about if it does come back up somehow, that means the recession that we\’ve been all talking about pre-coronavirus is still set to happen. This coronavirus just simply accelerated the path of it happening at the end of the day meaning, \”Houston? We have a problem.\” Meaning all of the things that I\’m speaking about, consumer sentiment, people getting in cash. You\’re hearing meat producers are shutting down the supply line, you\’re seeing the vice president telling workers to stay on the line. I mean, that\’s not normal.
Bret Elam:
You want to talk about why there\’s no toilet paper or meat and things like that? Because again, there are some emotional things that are there, some things that are real and some things that are trying to drive ratings. Like realizing that how you can have two people on TV at the same time talking about the exact same topic and you\’re going to have two polar opposite opinions. That\’s called entertainment. So be careful of the things that we\’re listening to, of all the talking heads that [inaudible 00:19:38] out on TV as well, and let\’s just try and use as much factual information as possible because that leads to more rational decisions.
Bret Elam:
Because you\’re not going to give up a job making significant money and then all of a sudden head into a time period like we\’re at now and say, \”You know what? I\’m just going to go back to…\” You\’re not getting the same job, you\’re not going to get the same income let alone find a job in this environment today. Everything that we\’re going through with this stimulus money and stuff like that, Krause, is concerning. And it\’s starting to look at people in the eye as much as we can or through a TV into the eye and saying, \”Something needs to change.\” You cannot afford to go through a crisis of what it\’s looking like the way your portfolio is positioned today. You need to take a stance and start making some choices, making some decisions.
Bret Elam:
And if you\’re listening today saying, \”Am I too aggressive? Is my head in the sand? Do I need to be more proactive?\” I invite you to reach out to us at 1-800-516-5861. Again that\’s 1-800-516-5861. If you\’d like a little bit more information of what we\’re talking about here [inaudible 00:20:50] I encourage you to sign up for one of the webinars, where we\’re going deep into this information as well. Again, you can go to thrive, T-H-R-I-V-E, thrivefinancialservices.tyl16lnm-liquidwebsites.com to sign up for one of the webinars that are coming up. And again, do not be a procrastinator. Be a planner. There is no time that we can look back in history and say, \”Oh yeah, I remember. It\’s exactly like it is now.\” These are unprecedented times and this is a time to be proactive and not reactive with everything we\’ve just chatted about today, Krause.
Joe Krause:
Yes. We come and deliver this broadcast on Talk Radio 1210 WPHT. Tax day, the original tax day, is in the rear view mirror but the time to file is still a few months away. And I only bring that in there to try and, or reference that, to bring into a perspective of we are in a time of change, Bret. We are in a time where there is so much uncertainty. I hope that everybody will attend the webinar. There\’s no charge to go to the webinar, it\’s 70 minutes of time, and it\’s really [inaudible 00:22:06] full of information.
Bret Elam:
Yeah, we hear it all the time, too, Krause [inaudible 00:22:08] we hear from people that attend our webinars say, \”You know what? We\’re getting hit from every which way. There\’s a lot of webinars that are out there today talking about coronavirus, but it\’s actually good that you had some substance behind the webinar [inaudible 00:22:22] actionable items.\” And that\’s what it\’s all about, Krause, is just sharing actionable items with our listening audience, whether that\’s people that are sitting in front of us live, whether it\’s across a computer screen, whether it\’s through our webinars or here on the radio, Krause, we\’re just passionate about just giving back, of just making sure that people don\’t… That\’s wisdom; don\’t make the same mistake somebody else did.
Joe Krause:
[inaudible 00:22:41] well done, well said. Thrivefinancialservices.com, thrivefinancialservices.tyl16lnm-liquidwebsites.com. If you scroll down on the opening page, you\’ll find a click-through that will allow you to get the broadcast schedule of the upcoming webinars next week. You can get registered, you\’ll get a reminder the day of, you\’ll get the link where you\’ll just click on from home, and you\’ll be able to settle in and watch the webinar, absorb the information. And when it\’s all over you\’ll be more educated than you were before it all started.
Joe Krause:
We\’ll get to a commercial break. On the other side Karen Bezar is ready, willing, and able. She\’ll jump into the conversation back here in a moment on Talk Radio 1210 WPHT.
Speaker 1:
So, are you a member of the Thrive Army? If not, it\’s okay, you can still get a sample RMD tax report at no charge. All you have to do is go to thrivefinancialservices.tyl16lnm-liquidwebsites.com
Joe Krause:
And welcome back, everyone, to Road Map to Retirement, the Radio Show here on Talk Radio 1210 WPHT. Remember, if you\’re listening on radio.com, it\’s radio on demand. You can also on the website at thrivefinancialservices.tyl16lnm-liquidwebsites.com click on the media tab and go back and re-listen to the broadcast. These one-hour radio shows that we do on the radio station are also filled with informative information as David, Bret, and Karen get into details and have good conversation.
Joe Krause:
Karen, I come to you. You\’ve got an interesting topic to talk about, get a little bit deeper than what we mentioned a week ago about 401(k)s. I like the question. What\’s the answer? Is that something you should do? People out there I think might be considering that or at least, now that they\’re aware of it, they may be asking themselves the question.
Karen Bezar:
So, the second I heard that this was one of the stimulus measures is to allow people who have a 401(k) or a 403(b), most retirement accounts, that now they\’re allowed to take $100,000 out of their accounts. And I got this sick feeling in my stomach thinking retirement is hard enough to plan if you don\’t have an advisor who has taken into account how everything\’s going to affect retirement. But people out there that don\’t have advisors but have 401(k)s, I just don\’t think they\’re thinking it through. It\’s just making me crazy.
Karen Bezar:
So I\’m just going to touch on again, it\’s a stimulus measure because, look, there\’s people who are out of work and I understand that some people are in panic mode. But again, what the stimulus is letting you do is you\’re able to now make a withdrawal from your 401(k). It\’s called a hardship withdrawal. If you were under 59 1/2 and you took money from a 401(k), you either had to take a loan or you would take the money and then you have to pay taxes that year plus a 10% penalty. They don\’t want you to do it is basically what it comes down to because saving for retirement is so important. But people aren\’t… the devil… what is it? The details are in the… what is it, Bret?
Bret Elam:
The devil\’s in the details.
Karen Bezar:
The devil\’s in the details, right. So again, just a reminder: you\’re still going to be on the hook for income taxes on that amount; you\’re not getting away scot-free. You just have a few years to pay that money back. And there\’s just some details that people aren\’t thinking about and maybe you need to proceed with caution. So hardships withdrawals are subject to income tax, just keep that in the back of your mind. And since your savings went into retirement plans on a pre-tax you\’ll be paying taxes on the contributions and your earnings, so everything you\’re taking out.
Joe Krause:
What is the point? Why did they extend the… why did they increase it to $100,000? Was it just to provide people with a way to access some of their money without having an issue? Why did they do that?
David Bezar:
Yeah. There\’s probably, a lot of people are struggling, so to have a limitation, I mean it\’s still a limitation but they wanted to up the ante so people can get access to more money. I mean it\’s really that simple. Again, they\’re anticipating that things are going to get worse, not better. And that\’s one of the purposes of the show today is to get people to think, yep, you\’re seeing these bumps in the market. And a lot of people think that\’s completely reflective on what the reality is. And folks, if you\’re listening, what you\’ve got to understand, and I said this last week, if you\’re like most retail investors, you\’re not trading in or trading out of the markets. You\’re just basically holding course, you\’re just staying steady.
David Bezar:
Well, if you\’re not trading, then who is? Because the market\’s going up 2-3% a day, down 2-3% in a day. Well who\’s doing that? That\’s the short-term traders out there. For a lot of them, it\’s them trying to cover their short positions. And then market moves up, they got to sell out, it drives the market up a little bit more. I don\’t want to derail Karen\’s conversation but I just really want to stress the point: it is not a good, positive picture out there. And the government knows that. You may not know that but the government knows it. So that\’s why they extended the limitation, upped the ante, so people can get access to weather the storm. Because it\’s going to last a lot longer than anticipated for most people.
Karen Bezar:
So, back to me again. Back to Karen!
David Bezar:
Sorry about that.
Karen Bezar:
That\’s okay. But you need to play ahead. You\’re going to have an extra tax bill, don\’t forget you\’re going to have to pay that. And sometimes people aren\’t good at planning those things out. There\’s different rules for 401(k) plans. So there is hardship withdrawals, which this is, they\’re talking about. What we actually have been doing a lot of virtual appointments, people that have attended the webinar, and some people are not aware that you can do non-hardship withdrawals if you\’re over a certain age.
Karen Bezar:
And the reason people are doing that is their money\’s in these 401(k) plans and they have limited choices for investments. And right now, with the craziness of the market, people have become our clients and we\’re helping them sort through can they take a non-hardship withdrawal. And the reasons it\’s important because you get the money out of the company that\’s controlling it now and you get it more into your control so that you really can… it\’s scary out there and people are afraid of losing money. Even though the market\’s up right now, doesn\’t mean it\’s not going to be down the next day. So to avoid this, that\’s another option that you can take. But back to the hardship.
Joe Krause:
And I would think there may be a lot of people that have been separated from their employment, from their employer, that have 401(k)s that may never go back to that employer.
Karen Bezar:
So I\’m going to touch on that, people aren\’t thinking about that. So again, there\’s different rules with 401(k) plans. So they actually might make you jump through some hoops before you can even get to that point and what a lot of them do is they require that the employee exhausts all sources of money before taking a withdrawal. So it\’s just not a quick, easy, paperwork discussion with your HR department, and they may make you take a loan before giving you that withdrawal.
Karen Bezar:
So even though it sounds like it\’s free money, again, the devil is in the details. It\’s not out there. And if it is a last resort and you take the money out of your retirement plan, it could be the worst possible time. If your account\’s way down, you\’re taking money out of your account when it\’s at it\’s worst. Are you going to recover that? I don\’t know if you\’re going to recover that or not.
Karen Bezar:
And then the other problem is, sometimes if you take your loan, take the money out, and then you\’re no longer with the company, you\’re going to be forced to repay that loan, what you took out. Do you have an extra $50,000 laying around? Apparently not, because that\’s why you had to take the money in the first place.
Joe Krause:
You don\’t lose that money when you leave the company, assuming you\’re not going back to the company, but you do have to make a decision if your job has been terminated.
Karen Bezar:
Right. And if it\’s a loan, you usually have to pay interest and all kinds of other things, they\’re going to want that money. It\’s not free money. So even though you think it\’s free money, please, please, please, this is something you really need to consider. You need to talk to your advisor. If you want to set up an appointment with us, please look at the workshop, take a look at the workshop, and we\’re here for you, give us a call. But there\’s just so much confusing information out there.
Joe Krause:
Yeah. Thrivefinancialservices.com is the website address. The virtual appointments are nice because you can do those from home. The webinar is nice. I got to tell you, I\’m still confused about the 401(k). I\’m wondering about the individuals that worked at a company for 25 years, pumped money into the 401(k), my job is gone and I\’m not going back. I haven\’t been furloughed, I\’ve been let go.
David Bezar:
It\’s a simple process, Joe. It\’s something we deal with every single day. I talked about that, kind of the rescue-your-retirement strategy. It has a lot to do with the 401(k), the rollover process, if you\’ve borrowed money, if you haven\’t borrowed money. The simplicity behind it all is just give us a call. I mean, if you just want to get that confusion cleared up, you can go to the website, thrivefinancialservices.tyl16lnm-liquidwebsites.com, click on schedule a virtual 15-minute rescue consultation. Or attend our webinar, we address it on the webinar issue as well. That\’s the simplest thing to do.
David Bezar:
It was amazing. I had somebody call me yesterday say, \”I love my financial advisor. I went to your webinar. I have no interest in becoming a client of yours, but you said some things in that webinar I\’ve never heard before. Can you spend 15 minutes on the phone?\” And I did spend 15, I actually spent 25 minutes on the phone with that particular gentleman, completely answered all of his questions, completely enlightened him to the point that he said, \”Why has my advisor never told me this before? Let me go back to them. If I can\’t get straight answers, I\’d like to schedule another appointment and consider having you guys become my advisor.\” Not an obligation on our part whatsoever, but that\’s how we extend ourselves. We will answer questions if you need us.
Joe Krause:
Well done, well said. Nice job, Karen. Nice to have you back with us on this Saturday.
Karen Bezar:
Thank you.
Joe Krause:
We\’ll get to a commercial break on Talk Radio 1210 WPHT. Questions about your 401(k)? Thrivefinancialservices.com is the best place to begin. Be back in a moment.
Speaker 1:
We hope you\’re enjoying and learning from this week\’s radio show. And if there\’s an area that\’s important to you that you\’d like covered, send a text to (267) 870-8210. And remember, it\’s always complimentary, and there\’s nothing for sale.
Joe Krause:
And back here on Road Map to Retirement, the Radio Show as we come to you on this Saturday on Talk Radio 1210 WPHT along with David Bezar, Karen Bezar, and Bret Elam. I\’m Joe Krause. We turn our attention now to David Bezar to finish up the show today. The final segment is always as important as the opening segment. David, where are you going today?
David Bezar:
My goal really is by the end of this segment is to have people… well, here\’s what\’s going to happen: people are either going to hate me, they\’re going to love me, because I\’m not going to try to be politically with this. I feel so strongly as a fiduciary that there comes a point in time where you got to set your two feet into the ground, make your stand, and tell people what the heck is going on. Folks, we are being set up for a very significant pandemic crash. Now, I can\’t tell you we\’re prognosticators or we have a crystal ball, but we\’ve been prepping our clients for the past year when this specific thing that is currently happening. Now, we didn\’t know the perfect timing of it, Joe, but we have been talking about the asset bubbles, the artificially inflated stock market, the lack of proper intervention by the Federal Reserve. We\’ve been talking about all of this for our people. And prospects who have attended who ultimately became our clients because of that are very thankful, very grateful.
David Bezar:
And what I want to share with the audience, it\’s not too late. Because again, this is not the worst, we\’re pretty much at the beginning of the game right now. We\’re just seeing volatility in the stock markets based on no understanding of the ultimate consequence of an actual recession. This is all hysteria right now. We\’re now finally starting to see corporate earnings and estimates for Q3 and Q4, and now even the Q1 of 2021, and it is bleak. It is bleak. How can you sit there in your chair and just passively say, \”Well, things are going to be fine for me\”? Especially if you\’re already in retirement. I get incredibly upset, Joe, talking to people in a virtual appointment and asking the question of, \”So you\’re going to share your financial information with me, you\’re going to show me your IRA accounts with your existing advisor or your self-directed accounts. Tell me how they\’ve performed.\” I get two answers. One answer is, \”I don\’t really know because I haven\’t looked,\” which blows me away. And then the second answer is, \”I think I\’m down maybe 10 or 15%.\”
David Bezar:
So when they finally share those statements with me and our [inaudible 00:36:47] does our analysis, we\’re finding out people are typically 20+% down. And when we kind of enlighten them, it\’s a significant \”aha\” moment. Now with that, Joe, it\’s going to get worse. And again, I\’m not here to fearmonger anybody. It\’s just get yourself prepared. Let me give you some things. I sat around this week in my downtime. Now, my downtime is I\’m not in an office where, you know, I\’ve got lots of things to do. Primarily our focus right now is meeting with virtual clients, virtual prospects, spending that time. So in the interim I just get the opportunity to start thinking, which, a lot of times for me is not a good thing, but this is what I came up with.
David Bezar:
Here\’s what I want people to understand.
Bret Elam:
It is a good thing, Krause.
Karen Bezar:
It is.
David Bezar:
What people do not understand is that Washington is paralyzed and Washington is helpless to get us through this crisis. Last time around when we dealt with the Great Recession of \’08 and \’09, the government still had very powerful tools to come in and rescue the economy. That is not the situation today. Just consider this. So, back when the financial crisis of \’08, \’09 started, the critical fed funds rate was over 5%. So the fed still had the option to be able to cut interest rates pretty dramatically and stimulate the economy.
David Bezar:
Today, with the fed funds rate near its lowest levels in history, the fed\’s most powerful recession-fighting tool has basically been eliminated. The fed\’s neutered. There\’s nothing more that they can really do to stimulate. Now, they can print more money and call that stimulus and pass it out. But you know where a lot of that money is going to, Joe? A lot of BS-type things. And again, I\’m not here to offend anybody, but when we\’re in a financial crisis where the American consumer needs drastic help. 16 million people have been laid off past three weeks. We haven\’t even gotten into the deep part of the recession yet. Most of this stimulus money has not hit the people that it needs.
David Bezar:
They should have just wrote checks [inaudible 00:39:07] if you just take all the stimulus that has been created and divided it up around how many households are out there, that should have been the primary focus of the federal government to repair the American consumer. Because we are on a consumer-based economy and if the American consumer can\’t spend money, whether it\’s virtually or physically, that\’s going to be a major problem. And the fed now does not have the tool to cut interest rates.
David Bezar:
Back in the financial crisis, the federal budget deficit was only $161 billion. Near its lowest level in the century. So there was plenty of leeway that Washington had to go bail out the banks and rescue the economy. Today, Joe, the deficit is already crossing $1 trillion mark. Now [inaudible 00:40:01] $23 trillion, but the deficit of taxes not coming into cover what is a $1 trillion, big government spending and bailouts, tax cuts, however you want to call it, will cause absolute chaos in the bond markets, just like it did in previous administrations.
David Bezar:
Before the debt crisis in the Great Recession of \’08, \’09, the economy was booming pretty much for everybody, including the average working American. Even in the midst of economic crisis, a lot of people were still kind of doing okay. Today, the opposite is the facts. Inflation adjusted net worth for a typical household has fallen by more than half since 2007. Back in \’07, the country was mostly united. Democrats and Republicans quickly reached an agreement how to rescue the economy. Now, initially, a lot of people were against it. But if you remember back they came out with that initial bill, no, no, no, no, and then instantly went back to work and then very quickly $700 billion got distributed out in [inaudible 00:41:13] money and pretty much saved the economy and the government actually ended up making a profit on that.
David Bezar:
But in 2020, today, any kind of deal across party lines, pretty much unthinkable. This is what\’s happening to remedy what\’s going on, Joe. It\’s nearly impossible for failing companies or desperate households to get urgently needed government money this time around. And that\’s why the economy, which has been kept alive through bailouts for a lot of long years, artificially low interest rates, tax reductions, all the different things is impossible this time around.
David Bezar:
So I want people to strap in and get prepared. No joke. I fear, I got a lot of anxiety related to this and I got a lot of fear for the American consumer. And there are ways to protect yourself from this. There are strategies, whether it\’s Social Security, Medicare, taxation, investment portfolio management, proper legacy planning. If you are not paying attention to that and making it a priority outside of your own health, you are sadly mistaken [inaudible 00:42:32] you are setting yourself for a major fallout.
David Bezar:
So again, I don\’t want to plead with our listening audience. It\’s not a desperation perspective from my standpoint to do business. Thrive does plenty of business. But for your own sake, I would attend one of our webinars and get at least the education. If you want to jump right to a 15-minute consultation and see if Thrive is a company that can support you through this particular time, just go to our website, click on one of those two options, spend a little bit of time with us, and find out how you can mitigate the risks that I just talked about. And that\’s the tip of the iceberg, for at least your family. I really hope that you do that.
Joe Krause:
That was pretty powerful stuff, David, and I thank you for actually doing that. And I think that message, the message that we try and convey is that we want to educate you, or Thrive wants to educate you [inaudible 00:43:41] for a long time, now more than ever, you have to get educated. You have to find out where you stand.
David Bezar:
Yeah, Joe, that Thrive Retirement Roadmap process that we go through addresses Social Security and Medicare. And Joe, what we find most times is that we show a family how to increase the benefit that Social Security will pay them over a lifetime by an average of $100,000. And when we\’re dealing with these type of economic times, an extra $100,000 over your retirement years is a big darn deal. We show people the ultimate tax [inaudible 00:44:23] and here\’s the other thing, very quickly: we all got to come to a realization taxes are going up. It doesn\’t matter the administration; they\’re going up because of all this stimulus. So if taxes are going to go up, wouldn\’t it make sense to potentially pay taxes now? We run a report that shows that. We show the risk associated with your existing portfolio. And are you prepared if we go down and test and fall below the March lows, which is what is being predicted by many, many economists, many, many financial planners, we run an analysis to see if that\’s the case. That\’s that Thrive Retirement Roadmap. Let us do it for you.
Joe Krause:
Do it. Go to thrivefinancialservices.tyl16lnm-liquidwebsites.com, thrivefinancialservices.tyl16lnm-liquidwebsites.com. Start with the webinar coming up on Tuesday. Get registered for the webinar, you\’ll watch the webinar from the comfort of your home. When the webinar ends 70 minutes after it starts, you will be more educated, you will be compelled to have a conversation.
Joe Krause:
That\’s going to do it for this week\’s edition of Road Map to Retirement, the Radio Show. On behalf of Bret Elam, on behalf of David Bezar and Karen Bezar, nice to have Karen back in the room even though she\’s way down in the other corner, I\’m Joe Krause. See you next week, everyone.
