Whatever your retirement dreams, put concrete strategies in place to build your financial future. STRATEGIES FOR BUILDING YOUR FINANCIAL FUTURE
FOREWORD Thank you for your time and interest! This booklet was created as an educational guide to bring you greater clarity and understanding of the financial decisions you make. If you need more information on a subject discussed, we welcome your email and will attempt to get you the answers you need. Please be mindful as you read this; everyone’s financial situation is different. So any product or solution must match your specific financial picture. We strongly recommend you consult with a highly rated professional about every financial decision you make. Because, just as not all products are created equal, neither are all financial professionals, and the difference in knowledge and advice can be substantial from one advisor to another. Working with a highly knowledgeable, independent, well-rated professional can make all the difference when it comes to achieving the results you need. If you are ready to explore your retirement options and want some help cutting through the clutter and jargon, visit www.CertifiedSafeMoney.com for unbiased information and to connect with professionals who can answer all of your most pressing questions. If you ever have feedback related to this booklet or concerns about your retirement income and financial security, please email us at [email protected]. We’re happy to help. CSM202101FINFUTURE 2 [email protected] www.certifiedsafemoney.com
WHAT DEFINES SOUND FINANCIAL MANAGEMENT? Building your financial future begins with your first paycheck and continues to the end of your life – and possibly even further for many generations. Every financial decision you make today will form the foundation of your financial future and help provide you with the best retirement plan possible, even those that may not seem that critical. There are several steps involved in the management of your finances throughout your lifetime, including: - Cash Management - Asset Protection - Building and Growing Your Portfolio - Managing Taxes - Retirement Planning - Estate Planning While these are all individual components of sound financial management, they are also all related and build upon one another. CASH MANAGEMENT: IMPROVING YOUR FINANCIAL POSITION The first strategy for building your financial future is cash management. Early in your career, it may be enticing to regularly upgrade your wardrobe or purchase a shiny new car with your earnings, but this is the best time to start setting money aside and financial planning for retirement. During this stage in your life, you will need to make sure you are not spending more than you earn. If you’re not careful, you might start using your credit cards regularly to make purchases and rack up a substantial amount of high-interest debt. There are three primary steps involved in this stage. They are: - Assessing your current financial situation - Building an emergency fund - Staying or getting out of debt Come In Out of The Storm CERTIFIEDSAFEMONEY.COM 888-494-4012 CSM202101FINFUTURE 3 [email protected] www.certifiedsafemoney.com
In order to keep you on track, using a household budget is highly recommended. A budget should clearly outline your living expenses, such as housing, transportation, utilities, and food, as well as your income sources. Your expenses each month should ideally be less than the total amount of your income. Remember, your net spendable income is the amount you have available after taxes, and other deductions have been removed. While you may not have a lot of extra money during this early stage of your financial life, it’s recommended that you build an emergency fund so that you don’t have to rely on using credit for emergencies, such as necessary car repairs or a medical expense that your insurance does not cover. Ideally, your emergency fund will contain between three and six months of your monthly living expenses. But any amount is better than having no emergency fund at all. This money should be kept “liquid,” meaning that it is in a savings or money market account and can be easily accessed when it is needed (but not too easily accessed and used for “wants” rather than needs). Some strategies can help you get into the habit of saving regularly. For instance, you could have your bank or financial advisor automatically divert a portion of your paycheck each month into an account. That way, you will be paying your most important creditor – YOU – first, and you’ll be assured that you are adding to your savings plan regularly. VISIT www.certifiedsafemoney.com FOR SOLUTIONS ON SECURING YOUR FINANCIAL FUTURE WITH SAFE MONEY INVESTMENTS CSM202101FINFUTURE 4 [email protected] www.certifiedsafemoney.com
ASSET PROTECTION As you move through life, you will need to start protecting your assets – including your health and well-being, as well as your incomeearning capacity and even your life. While most people do not relish the idea of paying for insurance coverage, this financial tool can create a “safety net” that could ultimately protect you from many of life’s unknowns. There are many different types of insurance available in the marketplace, and you may need to consider some, or even all, of them, including: • Auto Insurance – If you or someone you know has ever experienced an auto accident, you know how expensive even the most minor repairs can be. Auto insurance can help pay for the cost of repairing or replacing your vehicle. It may also provide coverage for other expenses too, such as medical and legal costs. • Homeowners Insurance – Homeowners insurance can help protect against a long list of perils that could affect your dwelling, such as fire damage, destruction from natural disasters like tornadoes, theft, and even medical expenses from someone who is injured in your home. • Health Insurance – The cost of healthcare continues to rise every year. Even a basic check-up from your doctor can be costly, not to mention time-consuming with visits to the hospital or emergency room. Prescription medications can also add to your overall medical expenses. That’s why it is essential to have health insurance coverage. Even if your policy requires out-of-pocket for copays or deductibles, it can save you thousands of dollars – or more – depending on your healthcare needs. • Life Insurance – If you or your spouse were suddenly gone, how would that impact your children or others who may be depending on your income? Even if your children are grown and selfsufficient, would your passing create a financial hardship for your spouse or partner? If so, you should consider purchasing a safe money life insurance policy, such as Indexed Universal Life (IUL). The death benefit from a life insurance policy is received income-taxfree to the beneficiary. It can be used to replace lost income, pay off debts, or any other need that your survivors may have. Life insurance can also play a significant role in many other safe money financial strategies, such as supplementing retirement income or contributing to a favorite charity. CSM202101FINFUTURE 5 [email protected] www.certifiedsafemoney.com
• Disability Insurance – The ability to earn an income could be the biggest asset for most people. Without it, you would likely not have the ability to purchase or rent a home, pay for food, or obtain necessary medical care. That’s why disability insurance is so important. Someone who is just age 35 has a 50% chance of becoming disabled for 90 days or longer before they turn age 65. And approximately one in seven people who are between ages 35 and 65 can expect to become disabled for five years or longer. If you become disabled today, how long would you be able to pay your bills? How long before you had to dip into your savings to pay your living expenses and eventually deplete your savings? Further, if this happened, what would be your retirement income plan? Disability insurance can pay you a regular income benefit for a set period, such as five or ten years, or even until you reach age 65. This coverage can also help you keep your other assets in their initially intended place while allowing you to continue paying your living expenses. • Medicare – Upon turning age 65, many people will qualify for Medicare for their healthcare coverage. Original Medicare (which is Medicare Part A and Part B) covers various hospitalization expenses, as well as doctor visits and even medical supplies and equipment. Medicare Part D covers prescription medication. Alternatively, there is Medicare Advantage, which pays the same benefits as Original Medicare, along with certain other items, like vision and dental costs. • Long-Term Care Insurance – Nobody likes to think about needing long-term care. But the reality is that an individual who is age 65 today has nearly a 70% chance of requiring at least some form of long-term care services and support throughout their remaining lifetime. This care can be expensive. The average monthly cost of a private room in a skilled nursing facility (in 2022) was more than $8,500. And, while home care services were less, they could still run, on average, more than $50,000 per year. How would this type of expense impact your retirement savings? Medicare pays very little for long-term care services. That’s why a stand-alone long-term care insurance policy is one way to ensure that you don’t deplete assets in case of a long-term care need. Other options may include a combination life insurance/long-term care plan or an indexed annuity/long-term care option. • Retirement Income Insurance – Throughout their lifetime, many people will insure their homes, their cars, and their health. But what about insuring your retirement income? That’s exactly what a safe money investment, such as a fixed index annuity, can do. One primary concern on the minds of retirees today is depleting their retirement income and assets when they are still needed. But an annuity can ensure that you receive income for a set period, or even for the remainder of your life, regardless of how long that may be. FIND THE BEST RETIREMENT INSURANCE PROFESSIONALS AT www.certifiedsafemoney.com CSM202101FINFUTURE 6 [email protected] www.certifiedsafemoney.com
BUILDING AND GROWING YOUR PORTFOLIO The next step in your sound financial management strategy is to build and grow your portfolio. There are several things to keep in mind as you begin investing, such as your time horizon until retirement and how well you tolerate investment risk. As you inch closer to retirement, your allocation of assets will likely change. For example, younger investors can typically take on more risk for a potentially higher return because they have more time to recoup losses. But as your timeframe grows shorter, you will likely want to move to a more conservative strategy, where your gains may not be stellar. Still, you will also not lose a significant portion of your portfolio in a downward-moving market. MANAGING TAXES One of the most significant risks that people can face with their money is taxes, which can come in many different forms, including: - Sales tax - Personal property tax - Income tax - Capital gains tax - Estate tax Unfortunately, without a excellent taxmanagement plan in place, Uncle Sam could end up being the biggest beneficiary of your hard-earned savings. This includes income taxes that are taken from your guaranteed retirement income. Contrary to what some financial advisors say, you may not necessarily be in a lower tax bracket in retirement. In fact, in some cases, a retiree might even be in a higher tax bracket than they were in during their earning years. As an added obstacle, nobody knows what the tax rates will be in the future. However, they are likely to be higher than they are today. In early 2022, the highest federal income tax rate was 37%. But the top federal income tax rate over the past 107 years has been over 70%, a total of 49 times! CSM202101FINFUTURE 7 [email protected] www.certifiedsafemoney.com
How would being taxed on 70% of your earnings impact your retirement? There are ways you can reduce or even eliminate taxes on retirement income, which can leave more money in your –or your loved ones’– pocket. Year Rate Year Rate 2018-2022 37% 1950 84.36% 2013-2017 39.6% 1948-1949 82.13% 2003-2012 35% 1946-1947 86.45% 2002 38.6% 1944-1945 94% 2001 39.1% 1942-1943 88% 1993-2000 39.6% 1941 81% 1991-1992 31% 1940 81.1% 1988-1990 28% 1936-1939 79% 1987 38.5% 1932-1935 63% 1982-1986 50% 1930-1931 25% 1981 69.125% 1929 24% 1971-1980 70% 1925-1928 25% 1970 71.75% 1924 46% 1969 77% 1923 43.5% 1968 75.25% 1922 58% 1965-1967 70% 1919-1921 73% 1964 77% 1918 77% 1954-1963 91% 1917 67% 1952-1953 92% 1916 15% 1951 91% 1913-1915 7% Top Federal Income Tax Rates 1913 – 2022 Source: IRS (https://www.irs.gov/statistics/soi-tax-stats-historical-data-tables) CSM202101FINFUTURE 8 [email protected] www.certifiedsafemoney.com
CSM202101FINFUTURE 9 [email protected] www.certifiedsafemoney.com RETIREMENT PLANNING Building a plan for a comfortable retirement in the future can involve determining how much you need to save, and from there, creating a blueprint for achieving your goal. It is never too early to prepare for retirement. The sooner you start, the more you can have saved when you stop working. The amount of money you need in retirement can be influenced by several factors, including: - The age you plan to retire - The number of years you anticipate spending in retirement - The amount of healthcare expenses you will pay out of pocket - Inflation/future purchasing power During retirement, it is likely you may have more than just one single income source. Your retirement income sources may include some or all of the following: - Employer-sponsored pension - Social Security - Interest/dividends from personal savings and investments - Annuity, such as fixed index annuity Having a viable plan in place to maximize each of these lifetime retirement income generators is essential. ESTATE PLANNING MATTERS Effectively and efficiently transferring assets to your loved ones is another crucial component of an overall healthy and safe financial plan. Without a plan in place for this, your money and other assets could be excessively taxed, leaving far less than you had hoped for your survivors. An estate plan can help you ensure that the people and organizations you want to leave money to will be the recipients of your assets – not those chosen by the state. An estate plan can also help prevent your loved ones from going through the expensive, time-consuming, and public process of probate (which can also reduce the amount of money your survivors ultimately receive). Many people mistakenly think that only the very wealthy have estate plans. But this is not the case. Anyone who wants to make sure assets go to their intended recipients should have an estate plan. In addition, estate plans can include provisions that are beneficial during your lifetime. For instance, it could consist of a power of attorney, which appoints someone you choose to act on your behalf with legal and financial matters. Likewise, the medical power of attorney gives someone the authority to make medical decisions for you if you cannot make them yourself. This can better ensure that your wishes are made known and carried out.
TAKING THE NEXT STEP TOWARDS A SUCCESSFUL FINANCIAL FUTURE The right, safe money financial foundation can help you achieve both your short- and long-term goals– including a successful and worry-free retirement. So, you mustv work with the best retirement-planning professionals who can guide you in the right direction and answer any questions you may have along the way. If you would like to schedule a strategy session with an experienced retirement planning specialist, feel free to contact us at [email protected] LOOKING FOR THE SAFEST INVESTMENTS FOR RETIREMENT? VISIT www.certifiedsafemoney.com CSM202101FINFUTURE 10 [email protected] www.certifiedsafemoney.com All investments, retirement, and estate planning strategies (collectively “Strategies”) have inherent risks. Content is not personalized financial advice and should not be regarded as a complete analysis of the subjects discussed. All expressions of opinion reflect the judgment of the author on the date of publication and may change in response to market conditions. Although the information has been gathered from sources believed to be reliable, we do not guarantee its accuracy or completeness. There can be no assurance that you will achieve your goals if you implement any of the strategies discussed. Past performance does not guarantee future results. Indexed universal life insurance may not be suitable for you depending upon your investment objectives, risk tolerance, financial situation, and liquidity needs. Accessing policy cash value through loans and surrenders may lead to a permanent reduction of the policy’s cash value and death benefit, which may lead to a potential lapse of the policy. Insurance product guarantees are subject to the claims-paying ability of the issuing company. There may be tax penalties for distributions prior to age 59½. Working with a highly-rated professional does not ensure that you will experience a higher level of performance. Professional awards do not guarantee future investment success. Please contact the professional for more information regarding the criteria for any awards or rankings noted. Ratings can be based on client evaluations and the professional’s activity. Hyperlinks in this Booklet are provided as a convenience. Neither the information in this Booklet nor any option expressed herein constitutes an offer to sell or solicit any person to purchase any security or product. Investment decisions should not be made based on information in this Booklet. Individuals should rely exclusively on the offering material provided to them by a licensed professional or regulated entity when considering whether to invest. Usage of this Booklet requires your acknowledgment that you shall hold CertifedSafeMoney.com, Financial Media & Marketing, LLC, and its Officers, Directors, Employees, or Agents (collectively “FMM”) harmless. In addition, you specifically acknowledge and agree that no oral or written information or advice provided by FMM (Including without limitation its call center representatives) will (I) constitute legal or financial advice or (II) create a warranty of any kind concerning this Booklet or the services found on any website(s) related to or owned by FMM, and users should not rely on any such information or advice. FMM disclaims all representations and warranties of any kind, express, implied, statutory, or otherwise, to you and/or any other party, including, without limitation, any warranties of accuracy, timeliness, completeness, efficacy, merchantability, fitness for any particular purpose, and usefulness of the content provided. FMM shall have no tort, contract, or any other liability to you or any other users of content from this Booklet and/or to any other party. FMM shall not be liable to you and/or any other party for any lost profits or lost opportunities or any indirect, special, consequential, incidental, or punitive damages whatsoever arising out of or relating to the use of this Booklet, even if FMM has been advised of the possibility of such damages. Tax and legal information provided is general in nature and should not be construed as legal or tax advice, and it is not a substitute for your independent research and evaluation of any issue. If specific legal or other expert advice is required or desired, the services of an appropriate, competent professional should be sought. The firm is not engaged in the practice of law or accounting. Always consult an attorney or tax professional regarding your specific legal or tax situation.
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