Business Innovators Radio - Interview With Shawn Milton Founder of S&S Life and Financial Services Discussing Risks of Retirement

Episode Date: June 10, 2024

He was a missionary for 10 years after which he got married and felt led to start serving people in their finances. He has always had a knack for money talk and helping people. As far back as he can recall, He has always strategized when it comes to Finances. He loves helping families get out of Debt with my program and helping them plan a robust retirement plan. Shawn has run tons of debt-elimination illustrations and designed a lot of retirement income plans.Learn More: https://sandslifeandfinancialservices.com/ or https://debtfree4lifemaryland.com/Influential Entrepreneurs with Mike Saundershttps://businessinnovatorsradio.com/influential-entrepreneurs-with-mike-saunders/Source: https://businessinnovatorsradio.com/interview-with-shawn-milton-founder-of-ss-life-and-financial-services-discussing-risks-of-retirement

Welcome to influential entrepreneurs, bringing you interviews with elite business leaders and experts, sharing tips and strategies for elevating your business to the next level. Here's your host, Mike Saunders. Hello and welcome to this episode of influential entrepreneurs. This is Mike Saunders, the authority positioning coach. Today we have back with the Sean Milton, who's the founder of S&S Life and Financial Services, and we'll be talking about the risks in retirement. Sean, welcome back to the program. Hey, Mike. Thank you for having me.

Hey, you're welcome. So I think that a lot of people go, oh, retirement, yay. That sounds wonderful and then risk. What? You know, I don't want to hear about risks in or a retirement or risk impacting retirement. Tell me about these risks because we want to avoid them. So talk a little bit about some of the steps that clients can take to make sure that their retirement savings lasts their entire lifetime, you know, and avoid these risks. So, you know, in one of the podcasts that we did last, we talk about the longevity risk, which is just, you know, it, that's what, like, if you look at the, what's happening out in America, like, a lot of persons are wondering, have I saved enough?

Will I outlive my income? or sometimes when you look on how much you have saved versus, you know, if you should be, God forbids, confined to a nursing home, you know, I think the last time I did a research, the national average for a nursing home is $100,000. Wow. And in where I live, where it's close to the D.C. in the D.C. area, the M.V. area, I'm pretty sure it's way much more than $100,000, $100,000, you know? So even with your income, how are you able to safeguard your income if in the event that something happened?

Because we don't, we don't, I always hear someone say we don't buy insurance when we need it. We buy before the need arises, right? And that's a same thing. Yeah, you don't wreck your car and go, oops, I forgot to renew my car insurance. Let me go set it up. it's already wrecked. Yep. So these are some of the, at least one of the things that we actually need to put in place

before like, hey, if this happens, would I be safeguard with my retirement income still be, would I still be able to get my retirement income coming in? You know, so that's, that's, I think that's one of the, the hot topics on the American, the American persons who are looking to go into retirement, that's one of the things that they are looking at, like, do I have that longevity safeguard? And then we also have the market risk. The market can be up today and then tomorrow you're retiring and it's done

and then you're losing half of your portfolio. And not a lot of persons are comfortable with that market risk. Yeah, that's a really huge, huge point because risk, some people can take more than other people. And definitely, let's even be honest, that if you're your 20s and 30s, maybe you can take a little more risk planning for retirement because you've got a longer runway. But when you start getting into 50, 60s, you need to, you know, tap the brakes there on that risk. Talk a little bit about, you know, that are your plants comfortable with the level? of risk that they have. And I'm envisioning, you know, they're watching the news hearing about the markets or they're opening up their portfolio statement and go, oh, my word, we just

drop 30%. Talk a little bit about that risk and what can be done about that. So I'm going to use an example from the last two weeks. Today's the 29th of me. I'm 24. So I had two clients came to me. They were interested in the in the real estate offering that I, that, that, that, that, that has a double-digit return that we had mentioned. And I simply asked him a question, how much of this money are you comfortable with losing? And do you know what the answer to that is, Mike? Let me guess.

None. None. So you find that when you're in that 50s and above, and you know that retirement is us 15 years away, You don't want to lose any of that money. In some cases, I would almost say you can't afford to lose any of that money, you know? So I do have clients that they're not comfortable with the idea that, hey, I might go to bed today and then tomorrow or next week, my account is down $30,000 or $40,000 or $50,000. and there's that uncertainty of am I going to be able to get this back before I retire

or even get more than this so I could have enough money for retirement? And sometimes the answer is no. The markets are unpredictable. You know, and the past performance of the market is not indicative of what the market will be doing in the future. So you can say, oh, yesterday we had a good day. So two days from now, we're going to have the same day again or even a better day. it's it's uncertain, it's unknown,

and a lot of persons are not comfortable with it, especially in this type of market where you have inflation is happening. And I'm of the belief that once inflation takes place, it's kind of hard too to balance it out, because the prices are at the pump kind of remains the same, you know? And if you're on a fixed income, especially when you're in that retirement, then you want to be planning ahead for for that inflation so that you don't

leave outlive your money you know so when you asked to that client or or that person you know how much are you willing to lose and they probably said as little as possible or none what's the solution because we all know that money in the market you know stock bonds mutual funds things like that have the risk of volatility and you can lose money you You know, we can hear that earnings, whatever, you can hear, you know, all of these news items that cause a stock and a portfolio to drop dramatically. What do you do? Is there is there alternatives to start taking money out of that market? And, you know, I think that traditionally people go, oh, I'm just going to stay in cash and put it in savings.

Well, that's earning 0.000 whatever percent. And then, oh, I'll put it in a CD. Well, that's not wonderful. So what are some of those things they could be considering to get some of that guaranteed income without loss? So one of the things that we do look on is that we have real estate companies. They offer double-digit return in the year. And if needs be, we can also look at an annuity, which there is a downside protection, do like a double indemnity. So in the event that you're confined to a nursing home, then the amount your income would be doubled.

Wow. So that's the way that we can definitely protect our clients from outliving their money. You know, we are saying, hey, this is going to be what insurance company is willing to offer. You have that downside protection and you get some of the upside of the market, which and your gains are locked in every year. So you don't have to be worried about losing anything. That is just like, I like the word compounding for this example here, because your gains are. are always compounding on your principle. You can never lose.

And then you also have where, when it's time for you to turn on income in these annuities, then if you have to go into a nursing home, then you have that protection as well to know that, all right, I was planning for $100,000, but here is it a life event happens. There are changing circumstances. And well, my financial advisor kind of helped me with. a product that planned out for this, right? Yes. So you do have that, or you have also the life insurance.

You're doing Roth conversion into a life insurance. You're able to strategize as to how much income you're going to be taken out of the policy as well. And also lowering your tax risk as well using using a life insurance policy policy. So there's a few ways that we can definitely strategize to make sure that you are getting the best, you're getting the best outcome and income when that time is required. You know, I think that when you think about people that, you know, you think about those examples you see online, you know, here's Tom and here's Fred and here's their example and example. And, you know, Tom might have all of his money in the market. And he's showing, Fred, look, I made, you know, 24%.

And look at that great gain. And Fred only has an annuity where he earns much less than that, but it's steady eddy and it's not going to lose. But then all of a sudden one year comes and all of a sudden it's like, oh, my money in the market, we lost 48%. It's like, oh, my goodness. How much did you lose? None.

And I think that that is such a powerful position to be in, to realize you've got that protection on the downside. You can't lose money. And then you participate in the upside where you're going to be guaranteed a certain amount of return. And having those products, I feel like eight out of ten people don't even know that they exist. Yes. And that's because, you know, the internet is a very powerful thing, but it can also be a very dangerous thing because it's just information that sometimes we're not able to interpret without proper guidance. And maybe in the past, you know,

somebody sold a bad annuity and that client goes on to writing something that, oh, annuities are bad or even for a financial perspective, a financial advisor who doesn't like the idea of not having that asset under management and getting that fee from that, that they're saying, you know what, annuities is bad. And so you go on a website and you search it up and then you're seeing, oh, this is bad without sitting down and actually speak into an authority in that space to see how it would fit in your portfolio. Yes. At the end of the day, we have to realize that we have to realize, oh, this is our goal.

Our goal is retirement income that is safe, secured. And if that's what our goal is, then when we back engineering, we're trying to see, what tools can we utilize to get us there? Right? So if a client's want to take some of the risk off the table and also start projecting income and we decided, hey, an annuity might be what is best in this situation, right? We're just utilizing that particular tool to help safeguard that. So it's not a blanket statement where, oh, some people are like, oh, I don't want anything to do with annuities.

And I've had clients that, you know, they just don't want anything to do with any of it is because of something that they have read. That's probably outdated information. Probably that's 10 years ago. 15 years ago, 20 years ago. And the financial feel is always changing. The laws are changing. You know, so. And improving as well because we don't need to get into the.

Yeah, exactly. I don't want to get into the details of. misconceptions of annuities, but I do agree that 10, 15 years ago, there were some people that are like, oh, annuities are bad because. And it's like, oh, yeah, you know, that you need to be aware of that. But I know now that there are really powerful annuities that have added in so many of these benefits and writers. And it's things that you would never have dreamt that would provide you benefits of an annuity. But the biggest thing is safety, security, guarantee of income. You can't lose it. I think that is so, so powerful. And I agree with that, especially in today's day and age, you just, you just never know

what's, what's going to happen. And you want to not have all of your eggs just exposed to, to, in, in one particular place, you know? Yeah. So I definitely, definitely agree with that safety, with that safety piece, just having something there that is protecting you from the market. And talking about risks, you know, you mentioned inflation. You can't do anything about that. But taxes is another thing that we can't do anything about other than recognize that they exist, recognize they're probably going to go up. And this is my opinion only.

So you can comment on this. But taxes are related to the national deficit, which is who knows how much, you know, huge. because the only way to handle the deficit is to stop spending, which the government won't do, or to raise taxes. So we know that taxes are going to go up in the future. So how do you plan for that? So talk a little bit about how, you know, future tax changes could really impact retirement savings for clients. So there's one thing I always, I always ask my clients, do you believe that taxes will go up? stay the same or be lower in the future.

And I think, I think 95% people are like, you know, it's going to go up. And that's because, yes, we have a spent, we are, we do, we're spending and there's a deficit. And all of these things are playing into, into, into, into, into our retirement. And we're also, taxes is, is, is not static. You know, it's dynamic. And it's, it's, it's, it's, it's based. off even the leaders that are in. You know, if they see it's, it's okay to raise taxes.

So being that we don't know the outcome of what future taxes is, and that is why I always say we have to have a strategy when it comes on to retirement income, right, to see how we can balance our portfolio, all of what we have, all of our retirement portfolio to also, to also kind deal with our tax or tax liabilities or our tax risk for for for for for retirement because you could be retired and the person who are who is who is leading the country decided hey it's going to be best for us to to raise taxes and if taxes are raised when you're on a fixed income then you might be seeing less of that coming coming out so um as as mentioned earlier you I have clients who they are some,

they bite the bullet and start a conversion to put some of their money into a tax-favored vehicle, like a insurance, life insurance. And even within doing a life insurance, you do have where you could also explore having that money being leveraged as well to where there's a match, whatever you put in is a match over,

match over a five-year period, and then that is being leveraged out to 15 years, and that is providing 60 to 100 percent more retirement income in the long term for you. You know, so as it really is the taxes, we're always having to look ahead as to what that tax obligation might be and also plan for it using different vehicles. As you know, annuity is tax differed. Right? So it's just a different strategy is that I feel that we would have to look at where the client is at, how much they have coming in, what's their goals in the future, and then execute on getting, on getting. What makes sense to them?

Because like we've said, over and over, it depends. You know, it's not one size fits all. It's not an annuity for all and everyone. And, you know, that conversion you were mentioning, you might be converting out of a 401k or an IRA into a Roth IRA where it grows tax free. And that could be an option. But it's not the right fit for every single person, every single time. So I think that right there is the most important thing people need to realize is when we're talking about these risks of retirement with volatility and losing money. in the markets and taxes and inflation.

There are ways to kind of put that moat of protection around your retirement savings where you can get guaranteed rate of return with no risk of losing your money. Now, what's the best formula to get there? That's what Sean's been talking about is it all depends, but here's an option, here's an option, here's an option. And I think that if people can understand that one concept right there, there's a way to protect yourself, now explore it and see what is right for you. you. Yes. So, and I think, I think that's the most important. As I said, looking at everything as a tool

to guide you to your goal. Yes. Well, I love it. Well, Sean, it's, it's always a pleasure here in just your simple, clear way of explaining things. If someone is interested in learning more about what you offer and how you work with your clients, what's the best way they can learn more and then also reach out and connect with you. So you could head directly to my website at S. and S-Life and Financial Services.com. And that's where you'll be able to see more of what I do and also to work as a consult. Excellent.

Well, thank you so much for coming back on. It's been a real pleasure talking with you. Thank you, Mike, for having me. I really appreciate you having me. You've been listening to Influential Entrepreneurs with Mike Saunders. To learn more about the resources mentioned on today's show or listen to past episodes, visit www.

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