April 29, 2020

10 Things We Can Learn From the “Scary Times” Success Manual

The “Scary Times” Success Rule book

We can’t control the events happening around us but we can definitely control our actions and responses. Because of this, I chose to focus on the upside instead of the downside. The same can be applied towards investment. We can focus on the negative and be paralyzed or look at the positive and take advantage of the opportunity.

In this episode, I’ll share the ten things we can learn from the “Scary Times” Success Manual of Dan Sullivan. We will talk about the opportunities in the new environment that we’re experiencing. We will also look at the things that we should be doing to put ourselves in the best possible position moving forward.

In this episode, you’ll learn…

  • Chris’ positive focus for the week
  • Ten things you can learn from “Scary Times” Success Manual of Dan Sullivan
  • Changing your practice to adjust with the trying times
  • How much risk are you willing to take into your portfolio
  • Focus on the opportunities in this new environment 
  • Two strategies that helped in the past in terms of structuring a portfolio to manage risk
  • Four ways we can help in addressing changing market volatility
  • Six key components to any estate plan
  • Reanalyze your portfolio by doing a risk exposure review
  • Two changes in law that opened tax planning with a huge opportunity
  • Where can you grow your money tax-free as a long term holistic plan

Links and Resources:

Follow us on Social Media:

Episode Transcript:

This is the Chris Berry Show, expert information on wealth, estate, and tax planning for the second half of life. Information that you can understand. Here’s your host, Chris Berry.

Welcome everyone to the Chris Berry Show. We start every week with a positive focus and this week is going to be no different, even though it’s been a crazy couple of weeks. So we’ve had all this market volatility and of course, everything that’s going on with the shutdowns and the social distancing. It might be hard to find a positive focus right now, but I certainly have one in and that’s spending more time with my family. I spent some time with my kids for about three weeks now. They’re nine and seven. My son Ryan and my daughter Madison and this has been an opportunity for us to spend a little more time together, working on homeschooling, learned what endeavor that truly is. But we put together some interesting homeschooling options where we were able to look at some virtual videos and a virtual Safari. We looked at elephants and giraffes and that type of thing. And then I had them write little reports.

We went outside, went on a walk. We threw a ball as we’re walking and my son was riding his bike, so that was our gym class. We had them both writing. My first grader Madison was writing an opinion piece on a book she read. My son Ryan was writing an essay that had a beginning and end and three parts in the middle. So it was great, kind of take on the role of a teacher for my kids. They were pretty excited about it too. They took part in helping us design our curriculum for the day. So, if anything, the idea is to try to gather something positive from what’s going on with this.

So with that, what we’re going to do on the show today is first I want to share something that came across from one of the people I look up to. A business coach, his name is Dan Sullivan. What he put together is what he called the “Scary Times” Success Manual. I wanted to share that with you right off the start. And then, of course, we’ll get into talking about this changing market volatility, where now we’ve truly been tested as it relates to how much risk we are willing to take on in our portfolio. We’ll talk about some of the strategies or opportunities that are available. But one of the things right off the bat, I do want to mention that we’re still helping our clients. That in this time of uncertainty, we have to be a guiding light for them.

That’s really what we’re trying to do is be that warm, comfy blanket in the scary time. And so for us, we are changing some of our practices. We’ve been doing weekly workshops in person. Obviously we won’t be able to do that currently, but one of the things that we have set up is a free webinar, that really captures the essence of our planning. You can actually access that webinar. We set up a site where you can just go ahead and register at any time by going to retirementplanwebinar.com. retirementplanwebinar.com, and then you can log in and watch that webinar. Also, the information will be of course on our website as well. So, instead of our in-person workshops, which we have been doing, you can now watch from the comfort of your own home as we talk about legal, financial, and tax planning tips in this new environment, not only for yourself but also for your family.

So that’s available again, retirementplanwebinar.com. I wanted to share this “Scary Times” Success Manual from Dan Sullivan. If you don’t know Dan Sullivan, he runs a company called Strategic Coach, that works with a lot of financial advisors and business owners. But I thought this was good and even if you’re not a business owner, I think this is all important information, as we’re kind of working in this different time. So the first thing is to forget about yourself, focus on others.

Uncertainty can drive people into themselves, making them feel isolated and helpless. But a lot of times the best strategy here is to go in the opposite direction. Expanding your connection with others and focusing on helping others, helping them, will kind of ease your worries a little bit. I was talking to this, even with my family, my mom, and how the tendency when things get scary is to turn inward and be more protective. But in reality, for our overall happiness and the greater good, we should continue to really focus on others and forget so much about ourselves and put others first. Whether that’s how you’re interacting with people at a grocery store or just with family, forget about yourself and focus on others. I think that’s good advice.

Second thing is, forget about your commodity focus on relationships. So, as a business owner when we’re helping clients, kind of plan for these types of things. It’s not all about the will or the trust, or this investment or that investment. Really at the end of the day, we’re in the relationship business. Likewise, when we’re interacting with clients, we’re trying to put them first and we’re trying to manage that relationship. Because again, as people get more scared, they depend on… We’re going to have to depend on other people. And so focus on the relationship. Likewise, I see this even in interactions with some of the people I’ve had on the phone and it just seems like it’s more about people now versus any type of commodity.

A third one, forget about kind of the sale and focus on creating value. We’ve never really been salesy, I don’t think. We really take an educational approach. And really, at the end of the day, we’re all about creating value. That’s what we’re here for, are we’re to help people eliminate the dangers and capture opportunities and reinforcing strengths. That’s really what we’re focusing on is trying to put our clients in the best position possible.

A fourth one, this is a good one, forget about your losses. Focus on your opportunities. If you were to focus on losses, it could be a scary time right now. You look at the markets, the 401k, your investments, all this wealth you’ve accumulated, it can be scary, but you can’t go back in time. We need to focus on the opportunities. We’ll talk about some of those opportunities in the show today.

Number five, forget about your difficulties, focus on your progress. So this is getting to that idea of we can’t change the circumstances, but we can focus on, “Okay, here’s where we’re at. Well, let’s focus on where can we go from here.” Number six, forget about the future, focus on today. This is a tough one for a lot of people, especially if you’re near retirement and you had $1,000,000 and then all of a sudden that million dollars have dropped 700,000, almost overnight, or 800 or 600,000, almost overnight.

That can really change your future. But there’s nothing we can do about that. What we need to focus on is today, the next 24 hours. What can we do over the next 24 hours, to create results, to put ourselves in a better position than we were? This is important, especially as it relates to your legal planning, your financial planning, your tax planning. While a lot of things are shutting down, things are still happening. I received a call to say… From a client, where a spouse passed away. So these things are still happening and we still need to have a plan.

Number seven, forget about who you were focused on who you can be. A lot of times people define themselves from external circumstances. Well, when these things abruptly change, whether it’s what we’re going through now or September 11th, we can’t be tied to that and we need to focus on who we can be moving forward. Forget about events, focus on your responses. And this is number eight and I think this is a very important one, is that there’s going to be events that happen, things are going to happen crises and chaos. Those things happen and sometimes people say life gets in the way. Well, in reality, life is the way. So these crazy events, you never know what life’s going to throw you a curveball.

The only thing you can control is your responses to these types of events. This is just good advice overall, not just when we’re in some scary times here. If someone cuts you off while driving, it’s your choice of how you want to respond to that. Okay? This is something I even talked to my kids about is you can’t control what anyone else is going to do, you can only control your own responses to them. Number nine, forget about what’s missing. Focus on what’s available. So when things change for the worse, sometimes resources change. It’s very easy to focus on anything that you’ve lost. If you look at your investment accounts or the market, if your investments have gone down, it’s easy to focus on what’s missing. But now we need to focus on what’s available, what are the opportunities? What are the strategic responses we can take to put ourselves in a better position moving forward in the future?

Number 10, and this is something that I really try to pride myself on is, forget about your complaints, focus on your gratitude. So when times get tough, everyone has to make a decision and they can either complain or they can be grateful for what they have. That’s why we start the show every week with a positive focus of focusing on gratitude. I’m not saying we should be an ostrich and just put our head in the sand and pretend this isn’t going on. That’s not at all what I’m saying. In fact, there’s a lot of actions we should be taking based on this changing world that we’re experiencing from a legal standpoint, from a financial standpoint, from a tax standpoint. There’s a lot of actions and responses we should be having right now. But to focus on the downside and be paralyzed with fear, that’s the last thing that we can do right now. We need to logically figure out what can we do based on these events to put ourselves in the best position possible.

So I saw that email comes across from Dan Sullivan and Strategic Coach and I thought it would be great to lead off the program, just talking about kind of the mindset of these scary times that we’re in. Interestingly enough, Dan put this together back in 9/11, when September 11th happened. I think it holds true today, given what we’ve seen with the shutdowns of school and basketball seasons and sports seasons. The world, it’s a little bit of a different place right now.

Again, those 10 things to think about. Number one, forget about yourself, focus on others. Number two, forget about your commodity, focus on your relationships. Number three, forget about the sale, focus on creating value. Number four, forget about your losses, focus on your opportunities. Number five, forget about your difficulties, focus on your progress. Number six, forget about the future, focus on today. Number seven, forget about who you were, focus on who you can be. Number eight, forget about events, focus on your responses. Number 10, forget about what’s missing, focus on what’s available. And then number 10, that was nine. Number 10, forget about your complaints, focus on gratitude.

Again, I think that’s the key component here is we can’t control these events. All we can control is our actions. I’ve been trying my best to understand that people are going through different levels of stress. And so with my interactions with people via phone or even our team members here, it’s not about kind of focusing on the downside. It’s all about focusing on the upside. The same can be applied towards investments is if you had money in the market, well you’re going to… You’ve probably seen some dramatic effects over the last couple of weeks. So one thing we could do is just focus on that and be paralyzed. Or we can look at the opportunities that we have before us. Again, it’s not to become an ostrich and put our head in the sand or pretend it’s all rainbows. No one’s happy about what the markets have done. But it happened, we don’t have a choice of that.

And so the next step is to figure out what are our responses? That’s where we can exert control. That’s a big issue right now is a lot of people feel like life is a little bit out of control. The markets are out of control. Well, that’s true to an extent, but there are things we can control. That’s what we’re going to do, over the rest of the show is talking about the opportunities in this kind of new environment that we’re experiencing. What are the things that we should be doing, right away to put ourselves in the best position possible moving forward?

Again, it might be a little bit different for everyone. I’m not saying there’s any magic wand or anything like that, but there are some big opportunities right now, where we should be looking at repositioning some things. If you want some assistance with that, give us a call, we are here for you. We’re here to kind of relieve some of that stress, to give you some peace of and put together a plan. That’s key is to have a plan moving forward because if you don’t have a plan, you don’t know where you’re going and it’s going to be more stressful. So give our office a call. You could watch one of our webinars. We are meeting with clients and as of right now, we’re still meeting face-to-face or we have video technology set up, where even prior to this, I’ve had some conference calls with clients all the way over in Australia and we’re able to still get business done.

So there are still things we can do if a face-to-face meeting isn’t appropriate for you right now. We can do video conferencing, which has worked out great. Actually, just the other day we had to sign some legal documents for a client and what we did is basically a drive through signing is we reviewed the documents ahead of time, via phone and video conference. They had copies in front of them and then when it came to getting everything witnessed and notarized, they didn’t even have to leave their car. They drove by our office. They use their own pen, which was sanitized. They signed the documents, we witnessed it and everything was good. So if restaurants can do drive-throughs, so can we, in terms of getting stuff done.

So understand that while there might be things shutting down, we can still work with you to put you in the best position possible because there are some things that should be taken into account from a legal perspective, a financial perspective, and a tax perspective. This is really a gut check. It’s a gut check for a lot of individuals who didn’t really have a plan. If you look back over the last 12 years, kind of joke around, but a monkey could throw a dart at investment and it probably went up. Well now, it’s a little bit of a gut check and we’ll continue that conversation on the Chris Berry Show.

Hi. We’re Madison and Ryan Berry.

Our dad is Chris Berry from the Castle Wealth Group.

The Castle Wealth Group used to be The Elder Care Firm, but dad wanted the company to be broader in its scope of services.

To not only protect and preserve assets, but to help people grow their assets to prepare for retirement.

As a certified elder law attorney and fiduciary financial advisor our dad and his team at Castle Wealth Group can help you with lots of important things.

To tell you more, here’s our dad, Chris Berry.

Thanks, Maddie and Ryan. Here at the Castle Wealth Group, we can help you put together an estate plan to avoid probate, work with you on a tax plan to keep more money for your family, and less for Uncle Sam and protect you against the devastating cost of longterm care. Our team is here for your family. I invite you to learn more about the Castle Wealth Group at our next free workshop where you will learn the three steps to create a legal, financial, and tax plan for the second half of life. Call us today to register at (844) 885-4200.

The Castle Wealth Group, formerly The Elder Care Firm.

Learn more at thecastlewealthgroup.com today.

Welcome back. So we’re talking about some of the scary times that we’re in now. As I was talking about, what we have to do is not focus on kind of the past, but focus on what can we do in this new environment? What are the opportunities moving forward? There are two things that we need to really protect against. The first thing is just being an ostrich and putting our head in the sand and pretending nothing’s happening. Granted, that might be a little bit hard right now, but I’m sure there are people out there that are doing this in terms of their investments, their legal plan, their financial plan, they’re just putting their head in the sand and hoping this all will blow over.

Well, I’m here to break it to you, but the environment, the world’s changed a little bit. If you don’t take action, you’re going to be missing out on some of the opportunities to put yourself in a better position moving forward than you were in. And then on the flip side of it is we don’t want to make rash emotional decisions either where all of a sudden we pull our money from the market or throw it all in cash or make just emotional investing. There have been studies upon studies to say how that could be very problematic at the end of the day. And so for your individual situation might be somewhere in between there. But that’s why it’s important to have a professional, have someone that’s looking at this logically, not emotionally, to figure out what are the opportunities.

Like I was talking about, you might have been one of those do-it-yourselfers or you worked with a guy that sells you stocks or bonds, but it wasn’t a true plan. Well, guess what? This is the gut check to say, maybe it’s time to have a plan. Because like I said, if you looked at it over the last 12 years, basically any investments should have gone up over time. You’re going to have ups and downs over that time. But we’ve been on quite the bull run for the last 12 years or so. So, we kind of knew that year 2020 what was going to be a little bit more volatile because of the presidential election and the fact that we’re on this run for 12 years. But no one really predicted the Coronavirus or any of this market volatility. This has been a little bit crazy, more than expected.

So even if you have a plan, sometimes it should be adjusted. And so right now it’s the gut check time where, if you do want a second opinion on things, now’s the time to reach out. Because we’re taking this bull by the horns, so to speak. Or I guess bear by the horns. Well, bears don’t have horns. We’re tackling this bear and we’re trying to turn it into a bull, talking about opportunities in this market. This environment of market volatility. We have different strategies that we can apply. There’s a couple of things to think about here. So the first thing is to look at this, your first thing is you could just remember your longterm care strategy. So for a lot of our clients where we’ve put together plans, even though they don’t like seeing this downturn in the market, we’ve had different strategies to minimize risk and volatility.

Some of those strategies involve looking at how much risk you’re willing to take on in their portfolios, where we do a risk exposure review, where we figure out how much risk is in your portfolio versus how much risk are you really willing to tolerate. And now that’s been put to the test with this market volatility. But for a lot of clients that’s something that’s very eyeopening for them, is to see how much risk is in the portfolio and we assign a risk score to that. And then based on that, we figure out how much risk are you willing to take on. If those two numbers are not in alignment, then we need to adjust that portfolio to get an alignment.

That’s something that we do with our clients is to make sure that their portfolio is in alignment with their risk. This has been a test of that. But as we’ve had conversations with our clients, they’ve understood that. The second way that we can address risk and volatility is through time horizons. So one of the tools that we use or concepts that we talk about with our clients is this idea of creating time horizons based on buckets of money. For example, let’s say you have your new bucket of money and that’s money that you’re going to need over the next year. That should be sitting in safety, liquidity, sitting in checking savings, right? Maybe money markets.

That would cover your income needs for the next year, any planned expenses over the next year, and then whatever your emergency fund is. So for the majority of our clients, who have subscribed to this thinking of ours, the ups and downs over a year aren’t going to affect them because they’re not going to have to pull money from those accounts in the downmarket. And then taking it to the next step. Most people have a later bucket of money. That’s money that’s invested in the market, that goes up and down, and they just know that they’re going to need it later. But what we try to do a lot of times is break out what we call a soon bucket of money. This is the money that’s more geared towards safety, more geared towards income, and is typically less volatile than that later bucket of money. And so what this does is buys a time horizon.

A lot of times that time horizon might be five years or 10 years to ensure that if the market goes up or down in any given year, what we see is over time it typically goes up. And so the money that they have in that later bucket of money, sure that might’ve taken a hit in this market volatility that we’re experiencing now, but they’re not going to have to dig into that money because they have that soon bucket of money in place. Again, you only take losses when you pull the money out. If you don’t pull the money out, then it’s not truly a loss at the end of the day.

So for our clients who have subscribed to this bucket planning approach, the market volatility is something that they were expecting and shouldn’t be changing any of their financial decisions at this point. So those are a couple of ways that we can address volatility or that we have addressed volatility in the past and those measures have stood up, stood the test of time is one, figuring out just how much volatility we were willing to take on overall. And then two, looking at breaking up our investments and the amount of risk we have based on time horizons of when we’re going to pull that money out. Those are two strategies that we’ve employed in the past in terms of structuring a portfolio, to manage risk.

Now, here are some things to think about in terms of moving forward. So one remembers your longterm care or your longterm strategy. So when you establish your portfolio, if you’re working with anyone worth their worth of salt, they should have talked to you about your expectation regarding market volatility or if you’re a do-it-yourselfer, you should have been thinking about market volatility. Because the markets don’t just always go up, right? So if your plan was well designed, then maybe you stick with that plan. But what I find is a lot of people have kind of a juncture with stuff. Sure, there’s some important stuff in there, some valuable stuff in their juncture, but it’s not organized. It’s not a true plan.

So if you’re sitting there listening and you don’t have a plan, you don’t have a plan for risk, you don’t have a retirement income plan, you don’t have a holistic financial plan, you don’t have a tax plan, now’s the time to reach out to us. Because there are some opportunities out there in the market, in terms of repositioning assets. But your first option is just to stick with the plan. So if you have a good plan, then market volatility should have been baked into it and this should have been something that was baked into your plan. If it’s not, or if you’re unhappy, now’s the time to reach out to us and get a plan in place moving forward.

A second thing to keep in mind is to avoid emotional investing right now. It’s one of the worst things you can do for your financial outlook, which is to intervene in the process and act irrationally based on fear. Because when you pull out while prices fall, you lose the potential gains waiting at the other end of the cycle. I’m not saying you shouldn’t think about readjusting your assets if you don’t have a true plan. But keep in mind, if you pull the money out, there’s a good chance that you’re going to take all of the losses without capturing the upsides. That’s where we get into the kind of a time horizons with this. If you have money in that later bucket, you shouldn’t be pulling that money out.

A third thing to think about, evaluate, and minimize your risk right now. So if you don’t really have a plan, well, you really need to kind of think about that now. How much risk are you willing to take on? How much more money are you willing to lose? Especially if you’re basing your income on that four percent rule, well, guess what? Your investments just took a hit. So are you willing to take more of a hit? Something to think about there.

The next thing to think about is thinking about your beneficiaries. All right. Think about the kind of the estate planning piece, the legacy planning. If leaving a legacy was important to you, then we need to think about strategies to ensure that if it’s important to leave a certain amount of money to the next generation of beneficiaries, we need to think about some strategies on how to ensure that we can still do that, that we can still leave as much to the next generation as possible.

Those are a couple of things to think about. Really at the end of the day, what we can do, there’s really four big opportunities right now. Four things that we can assist you with if you want to reach out to us. Again, one of the things you can do is you can watch an hour-long webinar on three steps to plan and protect yourself in retirement, where we talk legal, financial, and tax planning for the second half of life. You can access that webinar for [inaudible 00:28:30] listeners. You can access that webinar at retirementplanwebinar.com. Again, retirementplanwebinar.com.

So any listeners of the Chris Berry Show, you can go ahead and listen to that by going to retirementplanwebinar.com. Just put in your email and you’ll be good to go to listen to that webinar in the leisure of your own home, in the comforts of your own home. So again, we’re big believers in education. A lot of times we have in the past done weekly workshops to educate the public and clients on legal, financial, and tax planning steps. Well, we still want to get that education out to you. That’s why we’ve created this webinar just for listeners of the show by going to retirementplanwebinar.com. Again, retirementplanwebinar.com. It’s an hour-long, talks about legal, financial, and tax planning tips.

I wanted to wrap up with leaving you, four things to think about. These are four ways that we can help you given this market volatility. Because again, it’s a gut punch to people who don’t have a true plan. If you’ve just been flying by the seat of your pants and you’re strictly in an accumulation where it’s all about accumulating wealth and you haven’t taken steps to protect, preserve and figure out a distribution plan, then you might be hurting a little bit. And we’re here to help you. If you’re in that position, we’re here to help you. Again, we can have you attend that webinar. We can meet face-to-face if you’re up to that, at one of our locations.

We can do a video conference call where if you send over… What we’ll do is we’ll send out a short personal information form, gather some basic information, and then figure out how best we can help you with that video conference call. Or we can just do an old fashioned phone call as well, where if you can give us a call, we can schedule a time to answer your concerns, figure out where you’re at, and figure out where you want to go. Those are some options, on how we can help you address some of the issues going on now. Again, if you choose not to take action right now, that’s a choice in itself. In these times, these scary times, being paralyzed by fear, paralyzed by inaction, that is a choice that you’re making.

We can’t control the events. We can’t control what’s happened. But moving forward we can take action and put ourselves in the best position possible. So take our lumps, learn from that, and then move forward with the best plan possible. That’s what we’re here to help you with, in a very safe, secure un-threatening… It’s a scary environment out there. We want to be that warm blanket, that keeps you cozy. So to give you peace of mind, for the things that we can control. We can control what we’re doing with our investments. We can control the tax opportunities that still exist right now and in fact with the downturns of the market, even more of an opportunity.

We’ll talk about that in the next segment. We can control what we’re doing, from an estate planning perspective. Because guess what, things are still happening. People are still having… I just got a call the other day, the appointment had to cancel because mom had a stroke. So these things are happening and we need to have the legal documents in place, to make sure that we’re in the best position possible so that if you do need to make financial or medical decisions for a loved one, that you have the documents in place versus having to try to go to court and even the courts are shutting down right now.

So if you were to have to get guardianship for a loved one, you might not even be able to get into the courts to be able to do that. So, if something were to happen to you or a loved one, we need to have your rule book in place. That’s having that financial power of attorney, the medical power of attorneys, the trust, the will in place. Now more than ever, it’s an emphasis. Because guess what? It’s going to be harder to get things done. And so we need to make sure that we’ve stacked the cards in your favor, so that if someone needs to act on your behalf, that they have the authority through that well-drafted financial power of attorney or medical power of attorney or they have that trust in place. So if you were to pass away everything, avoids probate court and goes efficiently and effectively as possible.

Now more than ever, it’s time to think about getting your estate planning done. And again, we have processes and procedures, where you can get it done without even coming to our office. So just give us a call. We’re here for you and the number is (844) 885-4200. Stick with me after the break.

If you are a loved one is in need of estate planning, make sure you talk with certified elder law attorney, Chris Berry from the Elder Care Firm, like Dave Marsh did from Pinckney.

You hear stuff about attorneys, [inaudible 00:34:12] crooks, and whatever. I didn’t know if I could find one that wasn’t going to try and stiff me. So I was really happy to find the Elder Care Firm. They were just really, really helpful. I went to that seminar and when I would call people, I’d get calls back, they’d answer questions and it’s just I was really happy with it all. They laid out everything it was going to cost me and gave me really good peace of mind. I would recommend them to anybody and I don’t recommend a lot of people, but I would recommend them.

Hello, I’m Attorney Chris Berry. I can help you develop the best plan possible. Call (810) 214-3800 to schedule a free 15 minute phone consultation or to reserve your seat at our next workshop. The Elder Care Firm is here to help you and your family find solutions.

Visit the eldercarefirm.com today or call (810) 214-3800.

So we’re talking about things to do or opportunities based on this new environment. The first thing I wanted to bring up is that now is the time to really think about getting that estate plan done. That now with things kind of slowing down and shutting down, if you were to get a knock in your head, suffer a stroke, unable to take care of your affairs, your loved ones are going to have a heck of a time trying to get things done. So that’s why it’s so important to have that financial and medical power of attorney in place. As I said, we just the other day, had clients do a drive-by signing of their estate planning documents. So if you do want us to witness and notarize, you can do that without even getting out of your car. We can send the documents out to you so we can still get these things done.

Like I said, even though a lot of things are shutting down, life isn’t shutting down. Okay? Things are still happening. You never know when you might have a stroke or need longterm care or pass away. So we need to have these legal documents in place. The key things, the key components to an estate plan, there’s really six, typically. First, you have that trust, that trust that avoids probate, controls that distribution maybe builds asset protection. The second piece is that pour-over will. So if any assets do end up in probate, the will knock them into the trust. And also in that will, that’s where we appoint someone to make decisions with regards to funerals, that type of thing.

Third, very important right now in this environment is the financial power of attorney. So you get a knock in your head, who’s going to make financial decisions? And again, anyone over the age of 18 should have the financial power of attorney. And then fourth, the medical power of attorney. In Michigan, we call this the patient advocate designation document appointing someone to make medical decisions. Those two documents right now, super important to have in place. And then next we have what’s called a personal care plan. That’s the document that appoints someone or gives instructions to someone to make decisions with regards to longterm care. So if your medical power of attorney was all about end-of-life decision making, your personal care plan is about longterm care decision making. And then six, if you have real estate, we need to figure out what to do with your deed. It might be a ladybird deed that says it’s in your name while you’re alive and then upon death goes to your beneficiaries. Or if you set up an asset protection trust, we need to deed it directly to the trust.

So again, in these crazy times, we need to make sure that we’ve created our own rule book versus relying on the government’s rule book. Governments taxed out enough doing what it’s trying to do to keep things running. You don’t want to send your loved ones to courts or guardianships and conservatorships if you get a knock in your head. So again, if you’re over the age of 18, you need to have these key documents in place, creating your own rule book versus relying on the government’s rule book. That’s the first thing.

The second thing to look at is, we can do what’s called a risk exposure review. So we’ve just got kind of punched in the gut in the markets right now. So this is the time to really figure out how comfortable you are with risk. Over the past 12 years when we’ve talked about risk, we really haven’t seen the risk. All we’ve seen is the growth in the markets. But now we’ve seen the risk and it might make you kind of reanalyze those things. So one of the things that we can do is a risk exposure review. Take a look at your portfolio, figure out how much risk is still sitting in there, and figure out the best resolve or best route we can go.

A second thing that we should take a look at right now or the opportunity is a retirement income analysis. So with the changing in markets, changes in your investments, we need to make sure you still have an income plan. This is really one of the most important things in retirement because if you look at it, it’s kind of like climbing a mountain. While you’re climbing the mountain, that’s one set of skills. Then you reach the top of the mountain, which is retirement, now we need to figure out how to get back down the mountain. Really, it’s different phases and what we call the life cycle or the money life cycle. So while you’re working, it’s all about accumulating as much wealth as possible. And then you reached the top of the mountain and now it’s all about preservation and distribution.

If your portfolio took a big hit, then it sounds like we’re kind of missing on some of the preservation principles. That’s one of the things we can do is figure out what does that retirement income plan looks like now that we’ve had this change in the markets. That plan that you had previously still good? Did you even have a plan previously? So we can make sure or put together a plan so that your money lasts at least as long as you do? And then next is just having a good holistic financial and retirement plan. So we think there are five key areas that everyone needs to have a plan for.

First is that income plan. Okay? Taking our social security and pensions, looking at our expenses, how are we going to cover our expenses for the rest of our life? How are we going to make sure all of these assets we’ve accumulated last at least as long as you do? That’s that income plan. The second component is an investment plan. Okay, how much risk are we willing to take on in our portfolio? How can we minimize fees inside of the portfolio? That’s very important. That’s something that’s testing our volatility tolerance right now with the ups and downs of the markets.

The third is tax planning. This is one of the big opportunities right now, so is tax planning. Even before all this market volatility, we’ve had at 2020, tax planning was one of the biggest opportunities, because of two things. One, we had the Tax Cuts and Jobs Act that cut taxes, marginal tax rates across the board between two to three percent, and they’re coming back up. So right now taxes are on sale. And then in 2025, taxes are going back up, where if you’re at the 12% tax bracket, it’s going up to 15. If you’re at 22, it’s going up to 25. If you’re at the 24% bracket, it’s going up to 28. So right now taxes are on sale. And then you couple that with the SECURE Act which was passed, which was big news until all this market volatility.

The SECURE Act pushback required minimum distribution age from 70 and a half to 72. So the age in which you have to start taking out your RMDs required minimum distributions, and pay the taxes have been pushed back till 72. But that’s not the real reason they passed the acts. The reason they passed it is because they killed off the stretch IRA, where now if your beneficiaries were set to inherit an IRA, instead of being able to stretch it out over their lifetime, they can only stretch it out up to 10 years, putting more of a tax emphasis or tax burden on your beneficiaries.

So with those two changes in the law, tax planning was a huge opportunity where we could put together a plan to save clients potentially thousands upon thousands in taxes over their lifetime. Really, we take a macro view of taxes versus a micro view. A micro view would be just minimizing taxes in the year. We’re taking a macro view of minimizing taxes over your lifetime. And then now with the market volatility, this is even more of an opportunity. So if you have large IRAs, large tax-deferred IRAs, large traditional IRAs or 401K, now is the time based on the changes in tax code and now the market volatility, if the downturn of the market, if your IRA just drops, now’s the time maybe to pull that money out of the IRA, pay the taxes while it’s at a lower amount, and then throw it into something that grows tax-free.

Maybe a Roth IRA doing a Roth conversion. Maybe we look at permanent life insurance, indexed universal life that can grow tax-free and it’s tied to the index. So the money you put into that, if the market goes down, you don’t lose any of that money and it grows tax-free and it also can offer you a longterm care benefit as well. So as part of that holistic financial plan, tax planning is one of the biggest opportunities right now. And then fourth is healthcare planning. We still need to do this, even if there is market volatility, we still need to plan for healthcare. Because healthcare costs aren’t going away. I’m sorry, they’re not. And so we need to look at which Medicare plan to choose.

So taking an original Medicare with part A, B, and then adding in a supplemental and part D. You’re looking at Medicare Advantage and this is something that we can help you with and we can even help you virtually, where you don’t even have to come into our office. And then the second piece of healthcare planning is longterm care planning. So longterm care costs aren’t going away. The current nursing home still costs eight to $12,000 a month. We need to have strategies to help to think about how to plan for longterm care. Maybe it’s a legal strategy of setting up an asset protection trust or maybe we look at asset-based longterm care strategies where we can take $200,000 in your IRA and maybe turn it into $400,000 of potential longterm care or a tax-free death benefit to your beneficiaries.

There are different strategies with regard to longterm care and health care planning. And then the fifth area of any holistic financial plan is the legacy planning. What are we going to leave to the next generation? How do we leave it to them in such a way that it’s efficient and effective and avoids probate and the money goes where it’s supposed to go? Going to family, staying in the bloodline versus going to any of the in-laws, or anything like that. So those are the big opportunities here. One is to understand that you need to have your own rule book. You need to create your own rule book. You need to have that estate plan, you need to have those powers of attorney in place. We’re here to help you with that. And then second, do a risk exposure review. Figure out how much risk are you truly willing to take on any more in your portfolio. And maybe what you feel now as change.

If that’s the case, we need to look at making updates to your portfolio. Next, do a retirement income analysis. So look at how much your investments, your social security, your pension, how are you going to cover your income needs over the rest of your life? How do you make sure that your money lasts as long as you do? And then next, consider just a holistic financial plan where we take a look at your income planning, your investment planning, your tax planning, your healthcare planning, and your legacy planning. Making sure it all fits together. Because too often people might have a… They have their estate attorney and then they have someone that does their taxes and maybe they have a couple of investment guys.

Well, that’s not a true plan. It’s like when I went to the Ann Arbor Symphony a little while ago with my kids. It was a Star Wars night. So they’re playing music from Star Wars and we get there early. When they’re warming up, if you’ve ever been to the Symphony, it just sounds horrible. It’s like nails on a chalkboard. And my son was asking me, “What is going on? Did we pay money for this?” I said, “Ryan, hold on. Wait until the conductor comes out.” And then the conductor walks out and you hear a moment of silence and then the music starts and it’s beautiful.

That’s really what we’re trying to do for our clients in terms of their planning, is to turn their retirement really into sweet music. So the idea is that you have peace of mind by having a plan, and that’s something that we can help you with. Maybe the first step is to watch that webinar that we put together for you. So you can go to retirementplanwebinar.com and it’s just an hour long, and you’ll get some ideas on how to position yourself legally, financially and from a tax perspective in the best position possible.

Again, so kind of summing up today, it’s some crazy times out there, that’s for sure, scary times. I shared 10 things to think about, to maybe change our mindset a little bit, which is I think important. Where there’s a lot of scare tactics going on. People are a little concerned obviously with what’s going on and they should be. But first, forget about yourself, focus on others. I think that one’s really important. I’ll just pick a couple of these big ones. Forget about your losses, focus on your opportunities. Especially with the markets, the markets have lost a lot of their value.

What are the opportunities right now? Maybe we look at Roth conversions, maybe with a tax planning. Maybe we reanalyze how much risk we’re willing to take on, figure out if we’ve been receiving good advice over this time. Next, forget about difficulties, focus on progress. So we’re all going through struggles right now, different struggles, whether it’s figuring out a plan for the young children or maybe your grandfather, grandma and you’re watching the grandkids now because mom and dad have to work. Things are changing. Forget about the future, focus on today. So if you had a “future” that future might look a little bit different and there’s nothing we can do other than focus on today. What can we do today to put ourselves in the best position possible?

It’d be very easy to be paralyzed in fear, but understand that there are certain actions we should be taking, to put ourselves, our family in the best position possible, and they deserve it. So even though you might be a little scared or nervous, it shouldn’t be a time of inaction. Now should be a time of action. That’s what we’re trying to do. We’re trying to be leaders for our clients. Forget about who you were, focus on who you can be. Don’t get hung up in external circumstances, focus on what you can focus on. Forget about events, focus on your responses. So again, we can’t control what has happened in the past. All we can control is our response to that.

Forget about what’s missing, focus on what’s available. Again, the idea here is that these events have happened. Okay, we can’t change the past. All we can do is figure out what can we do to put our best foot forward. And then this is a big one, and this is really just good life advice. Forget about your complaints, focus on your gratitude. So again, it’s tough times. It’s scary times, that’s for sure. It’s sad too with the deaths rising because of what’s going on. But at the end of the day, we still have lots of things to be grateful for. So I’m grateful for our opportunity to do this radio show. I’m grateful for my family. I’m grateful for my clients. I’m grateful for the opportunity, I have to help put families in the best position possible. Very grateful. Grateful for my wife and grateful for my kids. I just have so much to be grateful for and I hope you feel the same way.

One of the things that I do on a regular basis, every morning I write out three things that I’m grateful for. And then I write out at the end of the day, three things that happened during the day that put a smile on my face, made me happy. So, I’m trying to focus on the things that we can control, and we’re here to help you. If you want some peace of mind. If you want to review your legal or financial or tax plan, we’re here for you. We want to make sure that you’re in the best position possible. You can’t control what the markets are doing, but there are certain things we can control. So now’s the time to take action, to take control of the things that you can control.

I invite you to attend that webinar, where you can see it again at retirementplanwebinar.com. I invite you to give us a call for a free review. The number is (844) 885-4200. We can review that legal financial tax plan. We’re here for you. It’s been Chris Berry, make it a great week. Take care.

Learn more about Chris Berry and how he can help your family by visiting online at thechrisberryshow.com. That’s thechrisberry show.com. You can also call Chris Berry at (810) 355-2584. That’s (810) 355-2584. This program content reflects the opinions of Chris Barry and his guests, not the Elder Care Firm, Prosperity Capital Advisors, or the Castle Wealth Group, and is subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment or legal advice or as a recommendation regarding the purchase or sale of any security or to follow any legal or tax strategy.

There’s no guarantee that the strategist statements, opinions, or forecast provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns. All investing involves risk, including the potential for loss of principle. There’s no guarantee that any investment plan or strategy will be successful. We recommend that you consult with a professional dedicated to your needs. This program is furnished by the Elder Care Firm.

Castle Wealth Group Legal in Media

Send Us a Message