Retirement Wealth Pro

A good financial plan is able to weather the ups and downs of the economy.

Here in Redmond, WA, the landscape is densely populated with large Douglas Fir trees.

These are beautiful, robust, intimidating trees, many that are 40 to 50 years old.

Despite their size, the roots of these trees are somewhat shallow, so that when extreme storms and heavy winds hit, these Fir’s get uprooted and come crashing down.

In comparison, some of the strongest hurricanes on record have been known to hit the Florida coast.

As these gale force winds sweep through streets, the palm trees that line blocks and coastlines are able to bend and sway so that even the biggest gusts cannot uproot them.

They adapt to the weather and ultimately come out stronger.

When you are building a financial plan in retirement, it’s likely you’ll need it to weather 30 years of economic headwinds.

As this current market cycle adjusts and corrects downward, do you have the confidence that your plan will withstand what will most likely be another great depression type of equities environment?

Nobody knows when, how far down, or how long this will be.

A good plan will need a solid exit strategy and the ability to make money in sideways markets.

You’ll also want to be in a position to take advantage of what will be the greatest transfer of wealth in history.

If you’d like to get a second opinion on your portfolio you can schedule a strategy session here: https://go.oncehub.com/StrategySessionwithCody

Ultimately, nobody can predict the future, but we can create the optimal environment to be successful in even the worst of weather.

I work with a ton of folks who are investing money in a 401K every month.

The challenge is that before they met with me, they were having to manage that money by themselves.

Unless you are following markets daily, have a rotation strategy, and know when to be in and when to be out, it becomes very difficult to know if you are making decisions with all the critical facts.

To solve this, I use a tool called the 401K optimizer. This is like having a personal money manager working full time on your behalf every day.

The program will help you choose which investments in your retirement plan are the most optimal for your risk tolerance, and will tell you exactly what percentages should be in each fund.

Then, quarterly, you will receive an email updating you on the status of the markets, trends, and ultimately, if you need to make any changes to the strategy.

In years like 2008, we used the Optimizer to help our clients cycle to cash before the crash, then cycle back into equities as the market rebounded in March of 2009.

There is no rule in the investment world that says you have to lose 50% of your money just to make some money.

If you have questions or would like to sign up, DM me, or go to this link to register. The cost is nominal.

You can register here:

www.401koptimizer.com >Howard Capital Management 401(k) Optimizer

Cody Crawford recently shared his thoughts about some common financial mistakes on MSN. Check it out below:

https://www.msn.com/en-us/money/personalfinance/the-top-money-mistakes-people-make-in-their-50s/ss-AAFN7X1?q=17 =9

This is something that I see in many portfolios.

Target date funds are designed to be "safer" as one gets closer to retirement.

In reality, their are severe flaws with the structure and theory behind these types of investments.

As this article states, when the market cycles downward, the challenge is taking money from a portfolio that is losing in value.

Ask a retiree in 2007 if it was easy to make up a 50% loss they took in 2008.

Mathematically this is very difficult. If you have target date funds in your portfolio it may be time to rethink the strategy.

Target-date fund design may be wrong for retirees Researchers suggest the funds don't adequately hedge against sequence-of-returns risk in retirement.

Successful investing during your working years means something entirely different in retirement.

The rules change.

Time is on your side during those accumulation years.

Faithfully saving, patience, and staying invested worked well.

In the spending phase, that lump sum you’ve saved needs to last 20, 30, or 40 years.

Think there will be some economic turmoil over the next couple decades?

A few market crashes?

Is it easy to make our money last if we have to use it as the market is crashing down?

Do you delay Social Security until 70 or take it as soon as possible?

What will your taxes look like year in and year out?

Do you have a Roth conversion strategy?

Which accounts should you pull from first?

We are currently in the late innings of the biggest bull market the world has ever seen.

Yet interest rates are at 5,000 year lows.

How should you allocate your portfolio going forward to mitigate risk yet still get some growth?

These questions can’t be answered with a pie chart of investments.

This takes planning.

I’ve put together a short video that will show you exactly how we’re helping those in and approaching retirement with the strategies that will allow them not just to retire-but retire and know that they never have to look back.

Here’s What You’ll Discover:

* The critical differences between the savings phase and the spending phase

* Why your focus should be on the 80/20 rule of retirement planning

* The ABC model of investing and why it is the key to success

* What it means to coordinate all of these things to fund your quality of life in retirement

You can register here: https://retirementwealthpro.com/freetraining

If you are tired of all the conflicting advice and are looking for a proven, fiduciary planning process that solves your retirement concerns once and for all, then this training is for YOU.

Click the link below to register for this free training before it’s taken offline.

https://retirementwealthpro.com/freetraining

Why math and science dictate that taxes WILL go up in the future:

Federal Spending Tops $3 Trillion Through May for First Time; Deficit Hits $738 Billion (Getty Images/Win McNamee)

It will be interesting to see if this becomes law.

As of right now Required Minimum Distributions are mandatory at age 70 1/2 for qualified plans.

If this passes that will be moved up to 72. Here is a good breakdown of the provisions of the proposed new law:

House passes bipartisan retirement bill—here's what it would mean for you if it becomes law On Thursday, the House of Representatives passed the Secure Act, a bill that aims to improve the nation's retirement system. The changes would be the most significant to retirement plans in over a decade.

Do you make these mistakes in your investment portfolio?

They’re common.

Most investors have made every single one of these in their financial lives.

Luckily, you were probably in your working years and lived to tell the tale.

1. Underestimating the Impact of Taxes

What is the biggest expense a retiree will have today? If you said healthcare you are wrong.

The average couple living to age 85 will pay close to $500,000 in taxes in retirement- assuming tax rates don’t go higher.

Could tax rates go up in the future? Could they go way up?


Does it matter that we have $22 trillion in debt and 50% of Americans no longer pay taxes?

Won’t they get the taxes from the people who have money?

At least there is a silver lining.

One that most CPA’s and accountants aren’t even addressing.

It is possible to get to the 0% tax bracket in retirement.

But it does take some work.


2. Ignoring The Sequence of Stock Market Returns

The adage “the market always comes back” may be accurate during working years, it does not apply during retirement.

When your working there is time to recover.


But imagine retiring in 2007 and by 2009, 53% of your portfolio was gone.

And that’s before you took out income.

Even when the market comes back, mathematically a retiree has no time to recover from these kinds of losses.

A retirees goal should be to manage risk.

3. Taking Social Security To Their Detriment

92% of Americans take their social security benefits to their detriment.

Ask most of them why they took their benefits early and most of them will tell you they took their neighbors advice.


So when is the best time to take social security?


What happens if you take it at 62 And pass away at 93?


What happens if you take it at 70 and pass away at 73?


In both cases hundreds of thousands of dollars have been lost.

Remember delaying social security also hugely impacts survivor benefits.

Another critical element about taking Social Security is understanding the taxation.

This is where “provisional income” comes into play.


Social Security is not taxable in and of itself.

Someone that is living only off Social Security will not pay taxes.

It’s the inclusion of other income sources, wages, municipal bonds, dividends, etc that causes Social Security to be taxable.

It’s amazing how many people actually think their Social Security will never be taxed.

Make sure you have knowledgeable resources and educate yourself before claiming your benefit.


For a deeper dive you can check out my latest blog post and share if it brings some value.

You can check that out here: https://retirementwealthpro.com/blogpost4/

Interest rates in the world are still at 5,000 year lows.

In the EU interest rates are actually negative. Meaning, you pay THEM to hold your money.

Our Fed chief Jerome Powell has said that they will not raise interest rates anymore this year for fear of slowing growth.

Does that sound like things are strong? That Europe can't make it at 0% interest rates and the United States struggles at 2.5?

But turn it on CNBC and every pundit is telling us that America is stronger than ever. Numbers don't lie in this sense.

As of 2 days ago, the 3 month bill and the 10 year bill were had something like a 10 basis point spread..this is super important.

When the premium for money you lend over 3 months is equal to what you would get for 10 years, that's a problem.

That means the market is telling us they value you holding that cash over investing it.

This is also known as "inversion" (when the short term is paying more than long term) and has been a reliable indicator of a recession for the last 50 years.

While it doesn't mean one is eminent, recession follows inversion by 5-19 months.

This also doesn't mean it's time to hoard cash.

Keep enough to be able to make moves but most of the indicators I follow tell me we have one more leg up with equities before the next major crash.

Then the real fun will begin.

Never forget...

For those of you that are parents and actually care that your child understands money and how an economy truly functions...

Get this book and read it as a bedtime story. It will teach them better than an economics degree today at most any college. Literally.

I have a lot of different accounts, bills and documents to track.

I used to use a spreadsheet but it just got to tedious.

I found a cool company called Finovera (no I don't get a kickback for recommending) that allows me to track all of my bills, accounts, assets, as well as store my living trust and insurance documents.

This is something that not only makes things easier, but more importantly if something happens to me, my wife will have one central location to track and pay everything real time.

You might think this is not necessary, but you'd be amazed at how many families have one primary person that pays the bills or handles the finances.

If that person passes, it can be a nightmare trying to figure out how to manage everything- at the very time you can't handle that type of pressure.

Here is the site

Finovera | Manage All Your Bills and Financial Documents in One Place Get your financial life together in ten minutes through Finovera Bill Management. Finovera helps you Manage & Pay ALL Bills and Accounts in ONE place. We support thousands of popular providers