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Welcome to Retiring Well where it's our job to help you enjoy financial security
in any economy. I'm Michael Reese, your
national show host. Hi, I'm
Eric Peterson, Retirement Planning Specialist from Des Moines in central Iowa.
This week we are talking about
gold. What the heck is going on
with gold and silver? We have your answers so sit back,
relax and enjoy today's show. Retiring Well with Michael Reese,
providing financial security in any
economy. Today is the day you can take control of your
financial future and eliminate worry about your money forever.
Retiring Well with Certified
Financial Planner and Retirement Planning Expert Michael Reese, featuring
Retirement Planning Specialist Eric Peterson, founder
of Peterson Financial Group in Des Moines. What's going
on with gold? It is dropping in value.
It is down significantly from it's high. It's in a bare market and
silver, we don't even want to talk about that. That's even
worse. I want to share with you what's happening here.
In a nutshell, if
you've been watching my show here for the past year
or couple years, you know
that I've been telling you
if you have a big position in gold, silver or something
of that type, then you need to buy
put options to protect your position.
And why? Because I've been sharing with you for the last
10 years in a row, gold has been up
in price every single year. So it's been going up, up, up
every single year for 10
years and I don't care what the asset is, when
something goes up in price every year for 10
years you've got a bubble going on. I don't care what
the asset is, I don't care what the argument is, I don't care what people are saying
that it's a good investment, this is like text stocks in the 1990's.
They just went up, up, up in price and the arguments
sounded good, new economy and all that, but it turned out
it was a bubble and they crashed. Same with housing prices and
lately it's been the same with gold. I like to say
history has an interesting way of repeating itself so
what I have in my hands here is a chart on
gold since 1975 and
it looks like this but the guys are going to bring it up on the tv behind me because
it would be easier for you to see but I want you
to look at what's going on in this chart. If you look back in the late
70's you can see gold
just going up, up, up all the way to
79 where it peaked out around $750 an ounce which I know
in today's standards doesn't sound like a lot or anything. But here it is, $750
an ounce, I think it got closer to $800 and then
what happened? It crashed. It went all the way down to about
$300. It went up a little bit, went down a little bit but
here's the point, when gold peaked in
'79, '80, around $750
an ounce, notice the price dropped. It crashed, people lost
half their value and
it took all the way
to 2006 before gold
got to $750 an ounce again. In other words it was up to $750
an ounce, it lost half it's value because the bubble crashed, this is back in
the late 70's, maybe 1980 and it crashed
and it took almost 30 years
before people made up those losses.
Now look what's happening. Look at the chart of gold since
the late 90's and the early 2000's. What has it done?
It looks a lot like the chart of gold back in the late
70's. Meteoric rise up, then
it got a little sketchy, right? And
in the early 80's it crashed and what's happening
now? It looks like it's on its way to crash again.
By the way, will history repeat itself? The answer, I
don't know. Nobody
knows. Anyone that tells you that they know what's going to happen
is completely lying to you because it's the future. We can't foretell the
future. We don't know what's going to happen here, but I can
tell you this, if you're holding big positions in either gold or silver
you need to pay very close attention. You
need to consider getting out before they drop
even more. You need to determine whether or not that makes sense for you.
That's what I see
on the national scale. What i want to do now is turn it over
to your local Retirement Planning Specialist and get their input.
And now featuring Financial Advisor, Eric Peterson.
Yeah Mike, gold has
been a hot issue here in central Iowa as well. There's
so much talk and buzz about it. And actually it's been going on for a number of years.
When they started advertising on television and
talk radio that gold is the only way to go
with all the printing of the money and economic collapse and
that they're big hitches if gold has never been worth zero and I agree with them.
I think gold always has a tangible value to it but this
run up is a little scary because it is a bubble. In my
office I have a chart and it's called an index chart and it tracks
all kinds of financial stuff if you will. Who is in
congress, who has controlled the house and the senate, who the president was
during that time, inflation, oil,
it also tracks gold and a lot of other things as well. What was interesting
is when I went back and looked at gold and I made some notes is that
when gold first appeared, or the first record we have
of it, gold was actually at $20.67
an ounce and that was 1926.
It had been fixed that way from 1879, really interesting, that's
a long time to be fixed. And actually it went to $35
an ounce and was fixed there until 1970.
Think about that. That's a long time to have a fixed price
on something that now we think can up
astronomically. So from 1970 to today
gold has gone up about 3,000 percent
but as you were mentioning, gold did hit this high in 1980.
So from 1970 we went off the gold standard at $35
an ounce to 1980 it hit close to $800. A huge
run up, but then it went down and was flat and
those people had to wait for 20 plus years to get their money back.
The thing is I don't think gold will ever be worth zero, but
I think it does have some volatility to it and it's not bad for a portion
of your money. The reason I have the chart is getting back to the
fundamental when you're talking about retirement income planning, like the
Egyptians they worked with a pyramid. The thing with a pyramid is
is that at the base is supposed to be the strongest.
Here in the base you want things that are safe,
you want a strong foundation and then maybe some
things that can have some moderate risk and then some high risk up here.
I would put gold up here at the high risk,
at the speculative. So with this red little peak.
Maybe a little bit of your portfolio there, but not everything
because there's no investment for 100 percent of all of your money.
I caution people when they talk about gold a portion will
be ok, hedge it, but don't put all your eggs in that
basket. If you're out there thinking what can I turn
to because interest rates are so pathetically poor, the stock
markets has done ok but I'm worried about that bubble, where can I turn?
We invite you to come in, call in to the show today and we'll go through our
3 step review process with you. Normally we charge $1,500
but we're going to do it complimentary with no obligation and what that will
take you through is a risk and fee analysis to show you what you're actually paying in your
current investments and what can happen if we have a repeat of bad markets.
We'll also do a tax analysis to see where there's some money falling through
the cracks and we can maybe save you so you can spend and enjoy.
And the last thing is an income plan, a very easy to understand
to show you where you are now and what it takes to get to your goal.
If you call into the show today we're going to do this complimentary with no obligation
but you've got to call today and that's our 3 step review, a $1,500
value, but we're going to give it complimentary.
Every week Eric I appreciate your insight. Very good
information. Folks, if you're in Des Moines you just heard Eric make a
special offer for you. I want you to call the number on the screen,
you have an opportunity to sit down with Eric who is
one of the country's top Retirement Planning Specialist absolutely free of charge.
You need to take advantage of that. I don't want you to go away
because coming we're going to ask our question of the week.
Let's talk about safe places for money that earn a decent return. You want your money to
be safe, that makes a lot of sense in today's unsettled economy.
But everywhere you look you can't find a place that pays you a
reasonable amount of interest. It's frustrating, that's where we come in.
Safe places for you r money that earn a decent return are available
if you know where to look. We evaluate them every day.
It's one more reason that now, more than ever, you need to talk to a Retirement Planning
Specialist. Why not call the number on your screen right now? We'd love to
talk to you about protecting your retirement.
Hi Michael Reese here. What I found is in that critical period
of the 5 years before retirement all the way to the 5 years after
retirement, in that 10 year period I find that over
and over again Americans are making mistakes with their
financial planning that quite frankly are easily avoided
and it really almost breaks my heart because if you make little
mistakes in this period of time you can have huge
consequences. So in order to help you not make
those mistakes I've put together a simple website with some
free videos from me to you
to help you be smart about your planning. The website is called
threemistakes.com
Why don't you go there today?
Let's talk about retirement income.
Studies show that a large number of Retirees are worried about running out of
money. Broken promises from banks, Wall Street and the folks in
Washington, DC may have you worred about your own retirement security. A stable lifetime
income is the secret behind a secure retirement. Your income should be based on
math, not markets. It's one more reason that now, more than ever,
you need to talk to a Retirement Planning Specialist. Why not call the number on your
screen right now? We'd love to talk to you about protecting your
retirement.
Welcome back, it's time for our question of
question of the week. This week's question comes from Janice in Lansing, Michigan.
Janice says she's been watching our show for awhile and she
likes our IRA blow ups particularly she says because
she's just inherited an IRA from her mother who passed away.
She's asking what do I do now?
Well Eric, I am sure that the same situation is happening there in
Des Moines. How would you answer Janice's question?
Hi Janice. yes that is an important question and
right off the bat I would tell you don't sign anything until
you talk to a Retirement Planning Specialist. The reason why is
IRA's are very complicated when it comes to distribution
to a non spouse beneficiary.
There are some rules that you're going to have follow because
if you want to avoid massive taxation the IRS
doesn't make it easy on you because your first option is to take it out
and cash. That's what the IRS wants you to do because they're going to get all of the tax.
But if you want to do something different, if you want to maybe
stretch the IRA which you are able to do and all you have to do
is take out amounts based on your life expectancy
then there's some hoops you have to jump through. There's also some time frame
that you have to have the money out by. In our office when somebody
has an inherited IRA we actually have a checklist of things
that we go through and we call the company because you have 2 types
of codes. You have the IRS code where they'll
tell you what you can do from an IRS standpoint and then each company
has a little nuance. Some companies allow you to stretch, some
companies don't. So you really want to find out which company
you're with, call them and see if they allow this. If not you might be able to
transfer it to a company that will stretch it. But we
cannot roll it over. You can't take receipt of that money and
then go and try and put it into another IRA because once you take receipts of it
it's going to be taxable. The only person that can take receipts and roll it over
is a spouse. So very small nuance and you don't want to
end up being one of these IRA blow ups on our show because you did something
wrong and then had to go to the IRS with what's called a private letter ruling
and try and get it reversed. So I would just sit down with somebody
who really knows intricacies of IRA's to lay out all
of your options because you're afforded the stretch option which is going to
be very powerful to you, especially if you don't need all the money right now because
you can still allow it to frow deferred and only take out
what the IRS requires. So this can be a benefit for you for many many
years which means you can do something in memory of your mom every year, maybe
take a nice trip or buy something for yourself. So just get the
correct information so you don't make the mistakes and end up in one of our
IRA blow ups because you have a lot of opportunity for you.
This week on chalk talk I want to
share with you a financial tool that's available out there
that can be really helpful when it comes to your
retirement income planning especially if you're
just within a few years of retiring. So let me share with you a simple
little scenario and I'll share with you how this
tool works and what it is. First, let's
imagine that we have a couple who
are 62 years old and
this couple who is 62 years old decide they want to
work a few more years, but they want to retire at age
65. When they're 65 they know
in a few years when they retire they're going to have some Social Security
income and maybe some rental income or some other
types of income but they know from their portfolio that they're
going to need about $2,000 a month
which is equal
to $24,000 a year. So they know that
in 3 years from now that they're
going to want to take distributions of about a couple thousand a month every year.
Right now they're sitting
on about $500,000
in their IRA's. So they've got IRA's, it's not a 401K
it's in their self directed IRA, they've got about $500,000
and one of the things that they're trying to identify is
they're trying to answer the question, is there a way to
take a portion of that money, and they're still making contributions of course because
they're still working, but can they take a portion of that money, set it
aside in such a way that in a
certain place where that account
will generate that $24,000 a year
no matter what the markets do. The answer
is yes there is. It works like this, depending on the
state in which you live, there are annuities out there with things called
income riders. These income riders are game changers for annuities
and depending on where you live, if you were to take
about $360,000, set it in one of these annuities
with income rider, let it grow for a few years, that account will
guarantee up to the claims paying ability to the insurance company and that account will guarantee
that $2,000 a month. In other words
you can take a portion of the portfolio, set it aside and generate certainty for
your future. Folks, if this is of interest at call the number on the screen. Talk
to a Retirement Planning Specialist.
That is chalk talk for the week.
Let's talk about safe places for money
that earn a decent return. You want your money to be safe, that makes
a lot of sense in today's unsettled economy. But everywhere you look
you can't find a place that pays a reasonable amount of interest. It's frustrating,
that's where we come in. Safe places for your money that earn a
decent return are available if you know where to look, we evaluate
them every day. It's one more reason that now, more than ever,
you need to talk to a Retirement Planning Specialist. Why not call the number on your
screen right now? We'd love to talk to you about protecting your retirement.
You've worked your entire life to become financially secure
so you can enjoy a comfortable retirement but when you get there
what's next? Wall Street and the financial media flood the airwaves with information
about what you should and shouldn't do, but who are they working for? Who can you trust?
For the past 17 years
I've focussed in helping people just like you protect and preserve
their retirement security and during that time I've identified
7 different lies, each with the potential to destroy
the security that you've worked so hard to build. I believe that you deserve to know
the truth and so I've built a website that hosts
a series of videos that's free of charge that you
can watch in the comfort and safety and of your own home.
You don't want to miss out on these powerful videos that shine the light of truth on
what can be a confusing topic. Why don't you go there now? It's absolutely
free and you'll b glad you did.
www.retirementincomelies.com
You deserve to know the truth.
This is my client
story of the week and today we're going to talk about
Jon and Susan and we're changing the names to protect the innocent as always.
Jon and Susan were a nice couple and if you notice
most of the couples that come into my office have been nice and I appreciate that,
but the thing about Jon and Susan is that they had saved a
nice amount of money for retirement, but they had no guarantees,
no pension. Unfortunately where both
of them worked they didn't earn pensions anymore because companies have take those away
or froze them. So they were worried about where
guaranteed checks would come from and they just really
didn't trust a lot of what Wall Street was telling them. They didn't believe that the market
would be able to support them in the withdraw and
what happens if they ran out of money when they run out of options? So we were able
to craft a plan for them and we use a structure
sips which stands for sequential income planning system.
With this system we were able to break their money
into 3 buckets. He was continuing to work for a couple
more years and then he wanted to call it quits. And when he called it quits
the first bucket was going to open up and pour out income to him and his wife
guaranteed. And we know exactly to the penny how much that income
will be. Then after 10 years bucket number 2 was going
to open up and that was going to pour out even more income because we put
some inflation hedge in there. We added this income rise so he could overcome
the cost of inflation. And that second bucket was guaranteed
to get them income for both of their lifetimes regardless of
what happens. So we took the market out of the equation.
We took and saw that based on mathematics so they could do well in
any economy whether the market is up, whether the market is down, or
the market is just sideways. In the thrid bucket we took a piece of money
and we put it there and that was their growth bucket. And with that bucket
had in it is things that are being actively managed by our investment
advisory firm. Very conservatively managed, but it gave them
flexibility and it gave them liquidity. So if they need a little extra money
maybe they want to take a trip or go visit the grand kids and the
income producing from bucket 1 or 2 was not enough, they could reach into bucket
3 and take any amount they wanted to. And they were so pleased
with this process because they had structure on some of it
but they still have the opportunity for growth on the other piece and
the growth piece we really didn't need to disturb. We didn't need to go into it every
month to pull income out. It's kind of like if you plant a seed and you plant
2 of them, one in each container and the one you just water
and give it sun and the other one you stir it up every day. Which
one's going to grow? Obviously the one that you don't touch. If you leave assets alone
if for growth and you don't have to touch them except for once in
awhile they'll have a better chance of overcoming market volatility.
So if you're thinking to yourself that sounds interesting, I would like to learn more
about this sips plan, I invite you to call into the show today.
If you call in what we're going to do is take you through our review process and
we'll show you what the structure will look like. I normally charge
$1,500 but we're going to offer it complimentary if you call in from the show today.
What it will consist of is first a tax analysis to see if we can save you some money
on taxes, see if there's some stuff falling through the cracks, a risk and fee
analysis and this is very important. It's going to show you what the risk is
in you portfolio, also what it's actually costing you in fees and
expenses and then we'll show you what the sips plan would look like for you. So if you call
in from the show today we're going to offer this complimentary with no obligation,
it's a $1,500 value, but you've got to call today. I look forward to seeing
you in the office. I don't know about you but
every week I absolutely love to hear these stories.
Here is your opportunity, now is the time.
Pick up the phone and call the number on the screen. You have
the opportunity to sit down with one of the
country's best Retirement Planning Specialist and right there
in your area. Pick up the phone, call the number,
sit down and visit, I promise you'll be glad you did.
Time to turn the page a little bit
because my dog Charlie has been out there surfing the
internet and he has a treat for you this
week.
In this week's treat Charlie brings us a story
of brokers behaving badly.
News release, April 13th of
2013 Merrill Lynch is in trouble.
FIRA, the financial industry regulatory authority, that's what
FIRA stands for. FIRA fines Merril Lynch
a million dollars and orders restitution for
failing to provide customers
best execution with non convertible preferred security
transactions and I know that sounds like
gobbly goop. So let me share with you what's really going on here.
Customers with Merril Lynch
were investing in these
non convertible preferred
stock and what happened was they wanted to sell it.
Merril Lynch sold it for them.
You would imagine that when Merrill Lynch sold the stock
that they were trying to get the best price available
for their customers. But no, it turns out that's
not what they were doing. Turns out instead, at least according
to this, that they were just selling the stock on their
system for the price that they said and a price
that was lower of course than what was available on the market and pocketing the difference
on their bottom line.
FIRA finds out, they fine him 1.05 million
dollars for basically
possing it to their customers. So it should come as no surprise to you
by the way that a big Wall Street is not
treating you with the your best interest at heart.
That they're instead focusing on their bottom line. It should come as no surprise to
by this point I would hope, but nevertheless
they keep doing it, and they keep paying these fines.
I love this at the bottom, it says in concluding the settlement
Merril Lynch neither admitted nor denied
the charges, but consented to the entry of
the charges, but consented to the entry of FIRA's findings.
In other words here's what they said. You know what.
you caught us. Here's a million bucks, now let's continue on
our marry way.
It's yet another reason that when you're
out there looking at your financial planning,
buyer beware. Wall Street has
taught us that we shouldn't trust them and here we
go again, they're giving us yet another reason
that you shoudn't believe that they're looking out for
you, they're just looking out for themselves. That's our treat of the week.