Growing Your Net Worth with Structured Notes

November 13, 2021 00:47:48
Growing Your Net Worth with Structured Notes
Retirement Results
Growing Your Net Worth with Structured Notes

Nov 13 2021 | 00:47:48

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Show Notes

Ford is joined by Greg and Robbie Miller of Buckhead’s Miller Brother’s to discuss how finances look like for business owners in today’s world. Ford also discusses how to grow your net worth with the help of Structured Notes, covers the most common misconceptions about retirement.

As a reminder, my radio and podcast listeners get a free financial plan to their 95th birthday and a free portfolio analysis. You will receive a Social Security Maximization Report at no cost to you when you book an appointment with us. Just visit www.activewealth.com or call (770) 685-1777.

Growing Your Net Worth with Structured Notes AWR SHOW 111221: Audio automatically transcribed by Sonix

Growing Your Net Worth with Structured Notes AWR SHOW 111221: this mp3 audio file was automatically transcribed by Sonix with the best speech-to-text algorithms. This transcript may contain errors.

Producer:
Registered investment advisors and investment adviser representatives act as fiduciaries for all of our investment management clients. We have an obligation to act in the best interest of our clients and to make full disclosure of any conflicts of interest, if any exist. Please refer to our firm brochure. The ADV to a Page four for additional information. Fixed annuities, including multiyear guaranteed rate annuities, are not designed for short term investments and may be subject to restrictions, fees and surrender charges, as described in the annuity contract guarantees are backed by the financial strength and claims paying ability of the issuer. Any examples used are for illustrative purposes only and do not take into account your particular investment objectives, financial situation or needs, and may not be suitable for all investors. It is not intended to project the performance of any specific investment and is not a solicitation or recommendation of any investment strategy.

Producer:
Welcome to the Active Wealth show with your host Ford Stokes. Ford is a fiduciary and licensed financial advisor who places your needs first. You'll help you protect and grow your wealth. The Active Wealth Show has grown because activators like you want to activate their retirement planning with sound tax efficient investments. And now your host Ford Stokes

Ford Stokes:
And welcome the Active Wealth Show activators I'm Ford Stokes your Chief Financial Advisor. And I've got Greg and Robbie Miller with Miller Brothers. They are fantastic. It's also a special place in my heart. You know, Miller Brothers is a is an Atlanta institution and a Buckhead tradition, and it's kind of what I say. And Greg and Robbie Miller welcome to the Active Wealth Show.

Greg Miller:
Thank you. Thanks for having us.

Ford Stokes:
Quick question, guys. How did you guys start? Miller Brothers, because we work with a lot of business owners and you know, you don't start out with this incredibly successful business in Buckhead. You kind of kind of earn it right. You've got to there's a starting point. There's a lot of hard work. Just talk to us a little bit about how you got started.

Greg Miller:
We're in our twenty fifth year or twenty five plus. I guess we're going into our twenty sixth year. We started both work through high school and college retail. Always enjoyed it, stuck with it. I was working for a big U.S. manufacturer. The company was sold. I was let go. It was Christmas. My wife was pregnant. I was well, yeah. And Robbie was working for someone else in Atlanta and was looking to make a change. So we decided we would, you know, try and go out on our own. And we started out very small, very slow. Twenty five years later, we have a nice big store full of product, a huge following, and we've been really, really fortunate along the way. But it has been an unbelievable amount of hard work. It's paid off and we've been lucky to be this successful.

Ford Stokes:
Yeah, it's kind of like a success equals, you know, it's kind of the point where hard work meets opportunity. So you guys have done a fantastic job and you do a great job taking care of us and and all the people that kind of work with Active Wealth and also some of the companies I've worked with in the past. And so I sincerely appreciate it. That's why I was like, I need to get you guys on the radio, especially going into the Christmas season. Real quick, can you just also while people are listening, can you just share one where you're where you're located? Also, how can people get in touch with you and talk to us a little bit about the really fun gift cards you guys have to?

Greg Miller:
We're at 3207 paces Ferry Place, which is kind of in the heart of Buckhead, just down the street from the St. Regis, kind of behind the Whole Foods and phone numbers (404) 233-8000.

Ford Stokes:
And also, they can check out Miller Brothers.com Is that correct? Yeah. Want to make sure we have the right website there, Greg and Robby, we always hear that, you know, people, especially when you're trying to climb the corporate ladder, don't dress where you are, dress where you want to be. Can you share a little bit about that and kind of your mindset and helping out a client just dress a little bit better and hopefully help out their careers as well?

Greg Miller:
I'm reminded of a long time customer that I've probably been working with for 20 years, and he used to say he's in the mortgage banking business, and he used to say fake it till you make it. He always made sure he looked successful. It worked, he said. It helped him become successful with people. People thought he was successful before he actually was. And we offer a broad selection. We can cater to a lot of people, more so than maybe some of our competitors because of the broad range we have. And what we do emphasize is buy quality, not quantity, and start out with. I mean, if you, well, starter kit, you know, you got to make sure you have a blue blazer. You've got a tan, lightweight wool dress, trouser, a gray, lightweight wool dress trouser and then you work around that with just basics. So you always look good. And then, you know, as you get a little older, a little more successful, you keep building on the wardrobe and we work with our clients. Like that all the time.

Ford Stokes:
Yeah, that's great. You also mentioned as people get a little older, you've got a lot of pre-retirees and retirees that come in there. We work with a lot of retirees and retirees and business owners, but it seems like people get to still feel connected when they come into your store. They get to talk Georgia football, they get to talk. Sec football, obviously, Joan, one of your top team team members over there. He's an Alabama guy, which is really tough for me as an Auburn guy. But just talk a little bit about how you've built that culture and that sense of community within Miller Brothers. But also, for me, it's really important giving that retiree that that sense of connection that they may miss when they're not there, no longer working.

Greg Miller:
You talk about the atmosphere and kind of the culture as well. We're here all day, every day. We work six and a half days a week and we're going to make it fun for us, too. And so, you know, we have the bar, we have the TV, we have the grill. And, you know, it just sits sort of a tone that makes it kind of not like a men's club, but it makes it fun place for people to come and, you know, have a drink and shop in the afternoon. And it's we got to make it for fun for us, too. So we try to make it fun for our customer.

Ford Stokes:
Well, you make it fun for me. It's great I can walk in there and get a bottle of coke, which is always a really cool thing for me. Just really appreciate everything you guys do. The other thing you guys do is you keep accurate records, which is so important in any business on everybody's sizing. Obviously, you know, COVID 19 put some pounds on all of us and put some pounds on me as well. And so but it was great to have a starting point and be able to be professionally tailored as well. And what a big difference it is because I mean, every everybody's got a different body type, but it's so fantastic to be able to get that tailored shirt where you look sharper and therefore you feel sharper and hopefully you can work sharper as well.

Greg Miller:
That's one thing that because of COVID, you know, everybody's kind of slacked off in their dress, but it's, you know, now that we're coming out of it, people are coming back and realizing they can't, you know, they can't sit around in their boxer shorts and do a Zoom call. All right, it's time to get dressed up again. Not that many people maintain their weight. They either lost weight because they didn't have travel for business et better have more time to exercise or people just at home and kept walking by the refrigerator or people are looking to buy new things or so much going on with weddings and other events, people getting out so people are excited about buying new clothes.

Ford Stokes:
Yeah, that's great. So talk to me a little bit about what you guys do regarding your retirement as well. I mean, you've worked for 25 plus years at Miller Brothers and you know the old adage with business owners as you really should try to figure out how to pay yourself first. You can't just work for payroll only your whole life, right? You know, we work with a lot of business owners with have them invest in a Sep IRA, which is a simplified employee pension plan and things like that. What do you guys do just to try to just in general not to getting into too much specifics? But what do you guys do to plan for the your retirement future?

Greg Miller:
Well, we I can't remember exactly, but I will say it's roughly twenty five years about what we started. We've both been working with the same financial planner and we do have a Sep IRA, as well as another IRA account and some other investments and life insurance and a number of things. So though not many people get really wealthy doing what we do. We've at least made a nice living and had been investing and planning for our future and our retirement.

Ford Stokes:
So yeah. So glad you guys have. That's great. Yeah, it's great advice.

Greg Miller:
So for your kids college?

Ford Stokes:
Yeah, that's right. It's college is not inexpensive these days. It's always good to try to get hope. Scholarship with your kids can go to Georgia, Georgia Tech or Kennesaw State or Georgia State or Georgia Southern or another of those schools as well. We see a lot of aspirational dress from retirees who are just, you know, they're going out, they're going to come see us in the king and queen building. And but also they want to dress to impress the kids and the grandkids as well. Just talk a little bit about, you know, kind of what you guys do to really help folks look sharper, even to impress even their own family members and friends. And then also, just again, share how people can get in touch with you. And also, how can they you've got a lot of people that don't know about those great gift cards that you guys have available that they can give to family members, too.

Greg Miller:
Sure. Well, as far as retirees, those retirees or people we've known, maybe even prior to our own business where we work for someone else in Atlanta, we've known a lot of our current clients for thirty five years easily, maybe in some cases more. And they were they were younger and their work careers and. And have now we've known them this long that they're now retired and their children, and they're in some cases their grandchildren are shopping with us so we can cater to. We actually have people that bring their high school children in a shop with us. And because of the price points, the variety we carry, you can buy a performance quarter zip or an unbelievably luxurious cashmere sweater or a piece of outerwear for your home and cashiers. And generally, our clientele has always liked dressing, appreciates nice clothing and their needs change, but they're still going to buy and they like to treat themselves to nice things or buy gifts for family members. So we're able to do all of the above. People come to us for a need and we try to figure out what does that need. I got a cocktail party this weekend. I just need something to wear out to dinner with my wife and just kind of ask questions and figure out what they want, and we kind of kind of fill the need, you know?

Ford Stokes:
Yeah, you all did a great job taking care of me with my daughter who was in the, you know, the homecoming court at North Forsyth High School. So thank you so much and really appreciate all of your support and help and also really enjoy working with Jonah, who's a great team member there. So again, thank you so much, Greg and Robbie Miller for joining us with Miller Brothers. And if you want more information on Miller Brothers, go ahead and check out Miller Brothers.com. And don't be scared to get over there and really have a great time with those guys, those guys and buy some gift cards, but also shops from really specific, great, neat things to wear during this holiday season. Greg and Robbie will have you on back soon, and thanks so much for all you do for me, and we're just so glad you're with us and I'm so glad you're in the community.

Ford Stokes:
And welcome back activators, the Active Wealth Show, and I'm joined by Sam Davis, our executive producer. And Sam, to all your family members who have served our country in the military, I want to say Happy Veterans Day to you and also to everyone out there who served our country, but also the family members who sacrificed with their family members serving in the military. I've got a whole lot of folks in my family who served in the Navy, the Army and the Air Force, and I just want to say Happy Veterans Day to everyone. And we'll go through some quick background information here on Veterans Day in a second. But Sam, just kind of happy Veterans Day to you and your family.

Producer:
Yeah, thanks to all the veterans out there, all the activators who are veterans who have helped protect this country and all that we cherish. Too many members of my family are veterans to to shot the ball out, but specifically both my grandfathers and my mother. Happy Veterans Day to you. Three inspiring family members and all all veterans. Very inspiring to me.

Ford Stokes:
No question. And it just keeps us free. Hopefully, we can continue to do that through the political process, although it's the political process has not been very fun recently. For me, it's, you know, my dad served in the Navy, my brother in law. He flew the F-18 Growler, which is kind of like the technology plane that that they fly off of all the aircraft carriers for the U.S. Navy. And I've got Uncle Arch, who was a U.S. Marine, and my uncle Ogden was in the army and my uncle, John Ford. He was a medic in Vietnam. And what's interesting on this day in nineteen eighty two? Sam, you were sharing with me that the Vietnam Veterans Memorial was actually dedicated on Veterans Day in nineteen eighty two. So that's kind of our this date in history. But I also want to give you everyone a little bit of background about Veterans Day. Veterans Day originated as Armistice Day on November 11th, 1919, the first anniversary of the end of the World War One and Congress passed a resolution in nineteen twenty six. An annual observance and November 11th became a national holiday beginning in nineteen thirty eight. Unlike Memorial Day, Veterans Day pays tribute to all American veterans living or dead, but especially gives thanks to living veterans who serve their country honorably during war or peacetime. And interesting, there's a couple of interesting little tidbits that I didn't know. Veterans Day does occur on November 11th every year. It was Thursday this week in the United States and in honor of the 11th hour of the 11th day of the 11th month of 1918.

Ford Stokes:
That signal the end of World War one, known as Armistice Day in 1954, President Dwight D. Eisenhower officially changed the name of the holiday from Armistice Day to Veterans Day in 1968. The Uniform Holidays bill was passed by Congress, which moved the celebration of Veteran's Day to the fourth Monday in October. The law went into effect in nineteen seventy one, but in 1975 President Gerald Ford returned to Veterans Day on November 11th due to the important historical significance of the date. Veterans Day commemorates veterans of all wars. And, you know, for me, Sam, it's just a big deal. We can't gloss over it so many folks who have not sacrificed and are given so much, we need to really understand it and recognize the sacrifice that's given. I just got to tell you, I remember my sister her second year of marriage, she saw her husband. Once for three days in Dubai, when he was stationed there for when they pulled into the Dubai port, and I just, I mean, she went her entire second year. Of marriage and only seeing her husband for three days, and it's just such an incredible sacrifice that our men and women of the armed forces give and just a big thank you and just want to recognize everyone who's a veteran and thank you for keeping us free. Your thoughts, Sam, on any of that?

Producer:
Yeah, absolutely. And I'll shout out one more member of my family. My brother in law, Josh served this country in the U.S. Army and thanks to thanks to all the veterans out there, we don't take your sacrifices for granted and we hope that many more into the future continue to make these sacrifices. So we continue to live the way we do.

Ford Stokes:
You've got to live free now. Let's go straight into our market update

Producer:
Your Active Wealth market update.

Ford Stokes:
So two hundred and sixty seven thousand jobless claims this past week, which still isn't a great number to me, but it's still OK. Just kind of get an understanding, you know, the largest jobless claims, you know, before the COVID 19 pandemic happened in 2008. And we're we're well below that now, which is helpful, but we still would like to see some of these seven million jobs get filled out there. And there's such a labor shortage and and I really hope people are not just trying to live off unemployment. I really want people to get out there and work. And or if you're retired, you've earned it. Congratulations. We love the opportunity to help with you. And also, if you're trying to figure out what do I need to do? I'm worried about the market going down again. I would encourage you to go ahead and reach out to us and visit Active Wealth dot com. That's Active Wealth dot com and we've got a button set, an appointment button, the upper right corner that you can just click that and get placed directly into my calendar. And we look forward to helping you there. But as part of our market update, U.S. stocks were kind of mixed on Thursday as major averages look to put an end to two day losing streaks. We had two days of of down market on Tuesday and Wednesday of this week.

Ford Stokes:
Dow Jones Industrial Average fell thirty three points, or zero point zero nine percent, while the S&P five hundred index and the Nasdaq Composite Index advanced 0.3 percent and zero point seven seven percent, respectively. Trading may be light, with the U.S. Treasury market closed on Veterans Day, which was obviously Thursday in stocks. Dow component Walt Disney Co. reported earnings and revenue that missed Wall Street estimates amid slower subscriber growth for its Disney Plus streaming platform. The company's park business, which includes theme parks, hotels merchandise, saw sales surge twenty six percent year over year. Not a surprise there with the reopening of the economy. There's an interesting fact Tesla CEO Elon Musk sold five billion of his company's stock. The stock sales with more on the way come as Musk faces a large tax bill as millions of stock options must be exercised. Electric vehicle maker Rivian Inc shares remain in focus after soaring 28 percent and their stock market debut on Wednesday. The company's initial public offering was the largest since Facebook's Twenty Twelve premiere. Tapestry Inc raised its annual outlook due to strong demand for luxury goods in the face of global supply chain crisis. The coach handbag maker surpassed Wall Street estimates for both the top and bottom lines. Dating app maker Bumble Inc said sequential user growth slowed for the first time as some markets implemented new COVID 19 restrictions.

Ford Stokes:
The slowdown resulted in users making fewer in-app purchases. Plant based meat maker Beyond Meat Inc guided current quarter sales below analysts expectations due to slowing demand in both grocery stores and restaurants. And no surprise there. In commodities, West Texas Intermediate crude oil edged up twenty nine cents to eighty one dollars and sixty three cents a barrel, and gold jumped fifteen dollars and 30 cents to eighteen hundred and sixty three dollars and sixty cents an ounce. Overseas markets rallied across the board and we only got a couple of minutes left in this segment, so I kind of want to set up the rest of the show. So first of all, it was great having Greg and Rob Miller of Miller Brothers on the show. They're just fantastic people. They take great care of everybody that walks into their show in the show room, and we like promoting business owners. So if you're a business owner and you want to be on the Active Wealth Show absolutely for free, all you've got to do is reach out to us. You can give us a call. At (770) 685-1777 (770) 685-1777 or you can just visit Active Wealth dot com or send me an email at Ford Stokes and Active Wealth dot com that's f0r d at Active Wealth dot com and will get you on the radio show for a segment absolutely free.

Ford Stokes:
No strings attached. No obligation, anything like that. And we also try to educate other business owners with the story of how other people go. And so it was great to hear from Greg and Robbie talking about how they've got a Sep IRA. They're also doing things with life insurance. How are they getting things ready for? Paid for college and save for college as well, and how it's a really good idea to go ahead and and save money for college, too. And I just thought their experience was great. There are twenty six year overnight success or in their twenty six year, if you will. And for the rest of the show, what we're going to do is going to talk about the five retirement tax surprises. I think you're going to find segment three extremely interesting. We'll also talk about a good idea and a strategy on a bond alternative that is a really neat product that you're going to want to hear about. And we'll talk a little bit about Roth Ladder Conversion and tax smart investing. And then also smart safe investing with different products and different ways of approaching that bond alternative investment. And listen, we've got an action packed show, the rest of these other two segments, you're going to want to stick around for it because we're we're talking about a smart financial plan, but specifically, we'll talk about the five retirement tax surprises that we talked about.

Ford Stokes:
But again, a smart financial plan equals smart, safe plus smart risk investments. Plus smart tax planning plus smart income planning, plus smart health planning. All of that together equals a smart financial plan. We give you a free, absolutely free, no obligation smart financial plan, including a portfolio analysis and a financial plan. Your ninety 90th birthday absolutely no cost to you, including a Roth Ladder Conversion plan at no cost. All you've got to do is visit Active Wealth and click that set an appointment button in the upper right corner. Again, that's Active Wealth and we're happy to help you, and we're so glad you're with us here on this Saturday or Sunday because we're now on two days a week on the weekends and. We're so glad that you're here being focused on your retirement because knowledge is power, and we're going to. We're here to help you retire successfully. Thanks, Leslie Active Wealth Show. We'll be right back on the Active Wealth Show right here on AM night when the answer. Talking about the five retirement tax surprises you want to make sure you're aware of.

Producer:
I see the crystal raindrops fall, and the beauty of it all is when the Sun comes shining through. Listen to the number one show on the weekends on a.m. nine 20. The answer to protect and grow your hard earned money. The Active Wealth Show with Ford Stokes, your chief financial adviser, Saturdays at 12 noon and Sundays at 11:00 a.m. Looking.

But a way to make a living barely getting by. You know, given. Use your.

Ford Stokes:
And welcome back to activators the Active Wealth Show. We're talking about the five retirement tax surprises and also one great bond alternative product that you may not be aware of. It's a little bit different than my traditional fixed indexed annuity bond replacement strategy. It's it's a little bit different, but it's we use both of these types of products. So let's talk about the five retirement tax surprises first. So number one is when you withdraw funds from your four one K or IRA, you have to pay taxes on those withdrawals and we want to do everything we can to make sure that we're planning for that. We need to do some tax smart planning on this number one thing because so many people, believe it or not, are surprised that they've got to pay taxes on the money they take out from their IRA, their four one K or their Sep IRA, or their four point fifty seven or their for three B. And so we've got to make sure we're doing everything we can to educate folks. But also the best way to get more tax efficient is to implement a Roth Ladder Conversion where you convert a little bit a year each year, and hopefully it's enough to outstrip the growth on your principal. So therefore you can eat into the principal and you can then build up a completely tax free portfolio with your Roth Ladder Conversion, you can grow that money, tax deferred and tax free.

Ford Stokes:
Also remember, with Roth Ladder Conversion, you have to wait the five year waiting period from each conversion and then also the other five year waiting period that applies is you have to wait five years in the time you open the account. It's an either or it's from the time you open the account or from each conversion. You can't convert one hundred grand and then start using that money two years later. You just can't do it. So you've got to wait five years because you want to make sure that the principal and the gains are completely tax free to you. And when you do a Roth Ladder Conversion with us, you fill out a Roth Ladder Conversion form with our custodian. We only work with high quality custodians like TD Ameritrade, Charles Schwab and Fidelity as well. And so we're here to help you implement the right type of Roth Ladder Conversion for you. And let me give you a really good hint here on the Roth Ladder Conversion, there's actually two hints. Number one is you're likely going to save six figures if you've got six hundred grand to a million plus in your form, your or your IRA and you implement a Roth Ladder Conversion, you're going to save six figures. Plus you're going to save one hundred thousand or more by implementing a Roth Ladder Conversion over your thirty five year retirement. You're going to save six figures, for sure. The Roth Ladder Conversion usually take between five and 10 years to implement properly.

Ford Stokes:
Number two is that most states do not tax on Social Security, so it's good to know that. And by the way, the state of Georgia does not tax on Social Security income, so they don't apply the five point seventy five percent in income tax rates on your Social Security, which is great news for our seniors and for folks that are living on fixed income. Number three is the tax on long term capital gains rates are not what they used to be. And. There's a lot of interesting tidbits on long term capital gains. When you sell a capital asset for more than you paid for it, the result is a capital gain and capital assets include stocks, bonds, precious metals, jewelry and real estate. The tax that you'll pay on the capital gain depends on how long you held the asset before selling it. Generally, it's between one and two years when you need to hold on to property or stocks and bonds and things like that. Capital gains are classified as either long term or short term and are taxed accordingly. Here are some key takeaways on this. Selling a capital asset for example, stocks, bonds, precious metals or real estate for more than the purchase price equals a capital gain. Next, as a short term capital gain, results from selling capital assets own for one year or less and are taxed as ordinary income, short term capital gains rates, folks, is ordinary income.

Ford Stokes:
Number three is long term capital gains result from selling capital assets own for more than one year and are subject to a tax rate of zero percent, 15 percent or 20 percent. I also want to be clear here too. Regardless of your income, there's a flat 28 percent capital gains tax on gains related to art, antiques, jewelry, precious metals, stamp collections, coins and other collectibles. There's one big, important note here President Biden previously proposed raising taxes on long term capital gains for individuals earning a million dollars or more to thirty nine point six percent. However, in September twenty twenty one. House Democrats proposed a smaller increase to the top capital gains rates, up to twenty five percent from the current 20 percent. But again, short term capital gains are taxed just like your ordinary income, and that's up to thirty seven percent in twenty twenty one, according to the twenty twenty one tax bracket from the IRS. And then the number for surprise retirement tax surprise is dividend income is better than what it used to be. Now this is only if you've got qualified dividend income, which most stocks do, and they can provide that at short term and long term capital gains rates. And the number five is Social Security benefits are often taxed by the federal government. Now we gave you another one that said most states don't tax for federal income. That's true. But the federal income, the federal tax rates are there and they're going to tax on eighty five percent of your Social Security benefit.

Ford Stokes:
They will apply your ordinary income tax rate up against your Social Security income, and they will they'll tax eighty five percent of it. They'll apply. Eighty five percent of the money you received from Social Security Administration. They'll apply the ordinary income tax rate against that. Let me recap real quick these five retirement surprises this file of retirement tax surprises. Make sure you know what they are. Number one is when you withdraw money from your forehead K or IRA or Sep IRA your four point fifty seven, your four or three. Be your simple IRA that equals a tax bill. You're going to have to pay taxes on the money you remove from those accounts. They're called qualified accounts. They are qualified for tax deferment, but that doesn't mean they were qualified for tax free distribution. They were not. So you ought to consider implementing a Roth Ladder Conversion, and the best way to do that is just to go ahead and visit Active Wealth. We're happy to help you. Number two is most states do not tax on Social Security. If you're doing your budgeting, I want to make sure it's clear if you stay in the state of Georgia, state of Georgia does not tax on Social Security. And number three is tax on long term capital gains isn't what it used to be. And we went through a lot in that and also just, you know.

Ford Stokes:
Uncle Sam, Joe Biden is proposing a thirty nine point six taxation of capital gains rates for anybody making over a million dollars. And then number four is dividend income is better than it used to be. And you got to make sure that you've got you own stocks that can provide qualified dividend income so you can get long term and short term capital gains rates. So hopefully specifically long term capital gains rates on your dividend income. And where you can reinvest the dividend income and then you only pay the taxes when you withdraw it. And when you actually sell the the security and and realize the gain from the dividend income and the growth on the stock as well. And then number five is Social Security benefits are often taxed by the federal government. Just make sure you knew that those are all five retirement tax surprises you need to know about now. A promise to make sure you understood a new product. Well, maybe a new product to you. It's not a new product to us, but it could be a new product to you, which is structured notes and it's a bond alternative. And. I want to make sure you understand, like the information about structured notes and their role in a portfolio is remarkably limited. And what we're going to try to do is aggregate some of the credible research, and we're also going to try to help you make an informed financial decision on investing in structured notes.

Ford Stokes:
Structured notes are a large part of today's financial market landscape, by the way. Globally, investments allocated structure notes are estimated to be in excess of two trillion dollars, even though structured notes have not been issued in the U.S. really since the mid nineties, they weren't issued before then. The availability of information is relatively scarce as well, with equity markets near all time highs and interest rate interest rates near historic lows, there's been a growing interest in the use of structured notes in the portfolio construction. Considering the size of this market and limited available information, it strikes. Kind of this radio host, it's an opportunity for me as a fiduciary to help. You know, all of my clients gain that market edge and hopefully help them retire and invest more successfully. A structured note is a financial instrument generally issued by large well-known financial institution like Citibank, Bank of America, Bank of Montreal, JPMorgan. A lot of different ones out there. Goldman Sachs. The terms vary both in time to maturity and market exposure. Each month, banks bring out their list of calendar offerings. It is important to point out that issuers split their calendar terms between brokerage offerings or brokers are paid an upfront commission and advisory offerings. We only work with advisory offerings. We don't charge a commission, so therefore you're able to get a higher rate of return, most likely from a structured notes.

Ford Stokes:
It's offered through our investment platform. Because advisory offerings are often fee based or for fiduciary advisors, the issues can strip out the commissions and provide more competitive terms to the end consumer investor. And so we're going to try to help you with these offerings, we've also got a monthly calendar offering. We have a different bank with a different interest rate and a different buffering. Every single month. And so what we also recommend was structured notes trying to do a structured note ladder, which which could basically allows you to ladder five structure notes over five consecutive months. And when we come back for the break for four segment four, we're going to talk about more about structured notes. Also the types of rates of return that you can get with structured notes and how they are vastly improved over the kind of rate that you can get from a bond and definitely vastly improved from the kind of rate you can get from a bank CD. Now, obviously, structured notes are security there. It does involve market risk, but it's measured market risk and what we call smart risk, and we want you to consider structured notes as part of your portfolio. And I think you're going to be blown away by the actual rates of return. So we come back from the break. We're going to talk about the types of rates of return you can enjoy in today's structured note environment.

Ford Stokes:
And welcome back activators to the last segment here on our show. And we're talking about structured notes as a bond alternative, we we just finished talking about the five retirement tax surprises that most folks have out there. And we want to talk about structured notes is a great bond alternative to help you generate a greater rate of return. Structured notes or financial instruments, which consist of two main parts combined to generate a specific return to generate a specific risk return profile and their most basic form. Structured notes are investments that combine a low risk, low return component of bonds with a higher risk, higher return derivative on a selected asset. Often, equities are or equity indices. So for me, just think about it like if you're driving around, you're just thinking about you take bond plus a derivative selected asset, and then that equals a structured note. Here's here's how this works. They're called buffered notes as well, or flash notes, but the buffering is this as long as the S&P five hundred, the Russell two thousand, the Nasdaq one hundred. Do not lose 30 percent from the point in time you purchase the note, your principal is one hundred percent protected. It is a security. It is at risk in the market. But as long as the the market doesn't lose 30 percent of its value, last time that happened was two thousand eight.

Ford Stokes:
We didn't lose 30 percent of our value in those indices in March of twenty twenty during the COVID 19 pandemic, as an example. Next is you can get some significant rates of return, which is really remarkable. The one that we offered in October paid eleven point one five percent. The one we're offering for the month of November comes from Bank of America. And as long as the S&P 500, the Nasdaq one hundred and the Russell two thousand don't lose 30 percent of their value. Your principal is 100 percent protected and it's going to pay a minimum of nine point twenty five percent. This is called an American style structured note as well. If you're interested in structured notes and you want to get between nine point twenty five to 10 plus percent over a 12 month period. And by the way, the minimum denomination on each one of these structured notes is only $1000. What we have is we have a lot of of my clients who will invest. Let's say they invest one hundred and twenty five thousand dollars into structured notes of their portfolio, and they're investing in five twenty five thousand notes in five consecutive months because it's a way to diversify your risk. Because if you're thinking, OK, wait a second. If I start out with a starting point of an indices in month one and then I go to the new one a month two one three and month four and then month five.

Ford Stokes:
Chances are, if one hits the actual trigger by, you know, all those indices losing 30 percent of their value, more than likely the other four or at least three of the next four are not going to hit that 30 percent threshold. Also with five different notes, those notes will mature faster as well. One other neat thing that I mean, it's great to get the interest rate, but most of these notes are called at the beginning of month seven. They have contractually in the note that they're not. The banks are not allowed to call the note before the end of the sixth month, so you get six months of nine point twenty five percent and we just roll it into a new structured note if you don't need the liquidity and you don't need to withdraw the money. This works particularly well in qualified accounts that can grow in a tax deferred environment. It still works well enough in a taxable account because you're getting a much higher rate of return. And so this is one of the things that really set our firm apart. If you were to walk into a bank and ask to purchase a structured note, it's more than likely you wouldn't be able to get as high a rate of return as we're able to offer.

Ford Stokes:
Generally, they're they've got commissioned notes that where the there's like a three percent, three to five and a half percent commission that's charged, we only charge our annual advisory fee. And so we don't get paid any extra money. We have no additional incentive. It's not a commission product for us and we're able to operate as a fiduciary. We also want to be clear about something when people are selling you a commission product and they are getting a commission, they are not acting in a fiduciary capacity because by definition they cannot. We do as financial advisers and we're here to put your needs ahead of our own. And we're here to take care of you. If you've been listening to show for like the last six or 12 or twenty four months, like many of you have, I would encourage you to go ahead and just take the next step and go ahead and give us a call. At (770) 685-1777 again (770) 685-1777. We're happy to help you. You can also visit Active Wealth dot com, or you can send me an email at four at Active Wealth dot com. Now let's get everybody a final countdown. It's the final

Producer:
Countdown. So let's recap what you may have missed. It's the final countdown.

Ford Stokes:
So today's show, we interviewed Greg and Robbie Miller with Miller Brothers. They're just fantastic folks, and it was great to hear from them. And if you want to take care of that special man in your life and be able to give him a gift card at Miller Brothers or go in there and let him go shopping. And so he can look his best and feel his best. So that's a really great way to go there. A fantastic men's haberdashery. We also talked about Veterans Day and just want to give a shout out to all the veterans out there and tell you how much we appreciate you and thank you for fighting for our freedoms. And then also we we talked about the five retirement tax surprises out there, and we talked about what a smart financial plan is, which includes smart risk, smart safe smart income, smart health and smart tax investment decisions. And we can help you build that smart financial plan. Absolutely. At no cost to you. We we provide a $500 value on the front end, and the way we make money is when we apply our advisory fee in our portfolio fees to your portfolio. But it's a flat rate. And guess what? We're on the same side of the table as you are. We want to see your money grow. So we're really completely aligned with you with your retirement investment account. We want to help you live the lifestyle you want to live. We want to help build a successful retirement. We want to help build a tax efficient fee, efficient and market, efficient portfolio and retirement for you. And another great way to do that is to invest in structured notes. We went through in detail what our structure note is, also how you can get a really great rate of return.

Ford Stokes:
The note we're offering for this month in November is from Bank of America, and it's paying a minimum of nine point twenty five percent. And next week, we're going to have Alex Borbon on with our investment team and our trading team, and he is going to share even more detail about structured notes is the real differentiator for our practice, and we want to make sure that we make sure everybody knows that structured notes are available to them and they can pay a lot higher than typical bond rates out there, like two, three four percent. Because structure notes offer a much higher rate of return in exchange for. Moderate amount of risk, and again, they are our securities than they do involve market risk. We're so glad you've been with us here on this week's Active Wealth Show. I hope you learned a little bit today and also again, thank you veterans for keeping us safe. Remember when you're planning for retirement? Information is power. If you're going to be a bear, be a grizzly. Be aggressive about seeking knowledge on the right type of financial products, the right type of way to structure your portfolio and how to really build a tax smart investment plan so you can actually get to that smart financial plan and build that successful retirement that you and your spouse are really going to enjoy for years and years. Because let's face it, folks, you're likely going to be retired almost as long as you worked. And we hope everybody has a great week, and next week we come back. We're going to talk in detail about structured notes with Alex Bowman from our Brookstone investment and trading team and hope everybody has a great week.

Producer:
Thanks for listening to the Active Wealth Show. You deserve to work with a private wealth management firm that will strategically work to protect your hard earned assets. To schedule your free consultation, call your Chief Financial Advisor Ford Stokes at (770) 685-1777 or visit Active Wealth.com. Investment Advisory Services offered through Brookstone Capital Management LLC become a registered investment advisor. Bcm and Active Wealth Management are independent of each other. Insurance products and services are not offered through BCM, but are offered and sold through individually licensed and appointed agents. Investments involve risk and, unless otherwise stated, are not guaranteed. Past performance cannot be used as an indicator to determine future results.

Producer:
A purchaser should evaluate and understand all of the risks and costs of an investment in structured notes Essenes prior to making any investment decision, a purchase of an SN entails other risks not associated with an investment in conventional bank deposits. A purchaser may not have a right to withdraw his or her investment prior to maturity or could incur substantial penalties for an early withdrawal if permitted. A purchaser should carefully read the disclosure statement and any other disclosure statements for a S.N. before investing. An investment, in essence, is not FDIC insured and is subject to credit risk. The actual or perceived creditworthiness of the note issuer may affect the market value of SNS. Essence will not be listed on any securities exchange. Even if there is a secondary market, it may not provide enough liquidity to allow purchasers to trade or sell Essenes. As a holder of SNS, purchasers will not have voting rights or rights to receive cash, dividends or other distributions or other rights in the underlying assets or components of the underlying assets. Certain built in costs are likely to adversely affect the value of Essenes prior to maturity. The price, if any, at which the notes can be purchased in secondary market transactions, if at all, will likely be lower than the original issue. Price in any sale prior to the maturity date could result in a substantial loss. Essenes are not designed to be short term trading instruments. Purchasers should be willing to hold any notes to maturity. The tax consequences of Essenes may be uncertain. Purchasers should consult their tax advisor regarding the U.S. federal income tax consequences of an investment. In essence, if a person is callable at the option of the issuer in the and is called, the holder will receive only the applicable redemption amount and will not receive any coupon payments that would have been payable for the remainder of the term of the SN.

Producer:
Sns are not, FDIC insured may lose principal value and are not bank guaranteed. This material is provided for informational purposes only and should not be construed as investment advice or an offer or solicitation to buy or sell securities. All data believed to be reliable but not guaranteed or responsible for reliance on this data. Past performance is not indicative of future results, which may vary the value of investments and the income derived from investments can go down as well as up. Future returns are not guaranteed and a loss of principal may occur. Brookstone does not provide accounting, tax or legal advice. Investors should be aware that a determination of the tax consequences to them should take into account their specific circumstances and that the tax law is subject to change in the future or retroactively. And investors are strongly urged to consult with their own tax advisor regarding any potential strategy, investment or transaction. Different types of investments involve varying degrees of risk, and there can be no assurance that any specific investment will either be suitable or profitable for a client's investment portfolio. Historical performance results for market indices generally do not reflect the deduction of transaction and or custodial charges or the deduction of an investment management fee. The occurrence of which would have the effect of decreasing historical performance results, economic factors, market conditions and investment strategies will affect the performance of any portfolio, and there are no assurances that it will match or outperform any particular benchmark. The investment strategy and types of securities held by the comparison indices may be substantially different from the investment strategy and the types of securities held by the strategy, not FDIC insured may lose principal value. No bank guarantee.

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