Influential Entrepreneurs with Mike Saunders, MBA - Interview with Curtis Cottle, Founder of SBC Financial Discussing Taxes in Retirement

Episode Date: January 12, 2026

Curtis Cottle is a Certified Financial Fiduciary, visionary growth strategist and cofounder of one of Michigan’s fastest-scaling financial services firms. He specializes in retirement planning, estate planning, and strategic tax strategies designed to help families and business owners protect and grow their wealth.At the core of his firm’s approach is a deep emphasis on strategic tax planning as it relates to retirement, helping clients keep more of what they’ve earned and build long-term financial confidence.He’s the creator of the Wealth Wellness Checkup, a planning experience that uncovers hidden financial blind spots and helps people make smart, informed decisions. The firm is built to simplify complexity, bring structure to planning, and deliver personalized strategies that work in the real world.With nearly two decades of experience, Curtis is known for cutting through the noise, building lasting relationships, and helping people create long-term security without the guesswork.When he’s not driving growth or designing new campaigns, you’ll find him investing in his team, building partnerships, or spending time with his family, living the same values his business is built on: fun, unity, and getting things done.Influential Entrepreneurs with Mike Saundershttps://businessinnovatorsradio.com/influential-entrepreneurs-with-mike-saunders/Source: https://businessinnovatorsradio.com/interview-with-curtis-cottle-founder-of-sbc-financial-discussing-taxes-in-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 us Curtis Cottle, who's the founder of SBC Financial, and we'll be talking about taxes in retirement. Curtis, welcome back to the program. Thank you, Mike.

I appreciate you having me again. You're welcome. And I know that this is a big topic, number one, but it also can be a confusing topic because I think the misnomer is, oh, when I retire, I'll be in a lower tax bracket and taxes will be lower. Maybe, maybe not. We don't know. So where do you begin advising your clients to begin that thought process in dealing with

prepping how to take care of taxes in retirement. Yeah, Mike, that's something that we deal with on a weekly basis. And you're exactly right. We have a lot of clients, many clients that say, well, I was kind of always thinking that I would be in a lower tax bracket when I get to retirement or this is the highest tax bracket as I'm working that I'm ever going to be in. And we're discovering and finding that more and more that's just not the case. And so on one hand, that's a good thing.

because on one hand, we're able to generate some higher incomes than they thought that they would get in retirement. So they don't have to drop off or have less resources as much as they thought. So that's one component. The other component is you always kind of see taxes expand it feels like. And I ask people in the future, do you think taxes are going to go down, stay the same, or go up? And most people, what we've found is they say, you know, I think probably if taxes move, they're probably not going down. They're probably going up. And so there's a few factors to consider when looking at that.

You know, and I think that if you were to stop a thousand people on the street and ask that question, or tax is going to go up in the next five to ten years, you know, most people would say, yeah. And I think if I'm correct, I'm uneducated, you're the expert. But what drives taxes going up is like the deficit. And the only way to close the deficit is to reduce government spending, which we've seen how that has happened in the past, not successful. or let's raise taxes to close that deficit. So taxes are probably going to go up. We don't know how much. We don't know when and we don't know what the brackets are going to do. So the point is it's such a big, gray fuzzy area, deal with it and maybe overprepared so that if some of the worst case scenarios don't materialize, then you're in real good shape.

Exactly right. And you mentioned the brackets. I mean, if you look at the highest tax bracket just coming off at 20, 25, 37 percent. now changed slightly different here on the 2026 changes. But if you look back to the history of taxes, the highest tax bracket's been as high as 91, and I believe as high as 93%. And that's because you see a lot of things pointing toward back in the 50s when it was that high from World War II debt. And so I think you're right. The deficit does play a big factor on which way taxes might move.

And nobody knows what and when and how. but, you know, it just kind of reiterates what we've been saying. It's coming. You've got to deal with it. And there's a lot of people that really don't even realize the full impact that they'll have to deal with because they signed those papers way back in the day when they got their first job, second job, third job called a 401K. And they've got money in that or an IRA that's never been taxed. And so now they've got these ticking time bombs where they think, oh, I've got X set aside for retirement. Yeah, but then we've got to start lopping off a whole bunch for taxes.

What are some of the approaches to deal with those untax, non-taxed accounts as they start coming due? Yeah, yep. And if you look at what most people have, Mike, is primary assets for many people are 401Ks, IRAs, or what we call free tax accounts. Like you said, they've never been taxed and they're waiting to be. And a lot of people will look at their statements and look at their balance and say, okay, this is how much money you have. then they forget that the IRS already has their hooks in there for when they want to take a withdrawal. They've got to take their taxes out before they get their net balance.

And so that being the case is all this money is, and this is why I brought Tyler on, who's my brother, but he was going to go be a CPA, and he was finishing his accounting degree. And I told him, I said, you might want to come work with me. And I'm glad that he did. And he partnered with me. And we now own the firm together as co-owners. And he really brought the tax. insight in the tax presence to say, what is the best way we can shelter this money, pay less

taxes to the IRS, maybe find some tax-free vehicles so where we don't have to pay? And we have many, many of our clients that we've gotten to be a completely tax-free environment in their retirement. Wow. Now, that everyone is different. Every strategy is different. I'm confident of that. But I guess one question would be, what are some of the high-level things that you start looking at when you're making those kinds of moves? What are some of the opportunities people could be aware of? Yeah, that's a really important factor. So one of the things that we do is we have on retainers some really strong tax groups that we work with.

And one of them, Hayden Tax actually is recognized by one of the original Shark Tank Sharks for the software that they've created on Roth conversions. and we work very closely with them. In fact, we're fortunate to have them in our backyard. And there's so many factors to consider between income taxes, Medicare taxes, extra costs on Social Security taxes, capital gains taxes, NIT. So there's just so many factors when you're looking at what is the impact of making Roth conversions or withdrawals. And so you need a powerful software. You need strong tax experts in your corner.

And that's exactly how we've positioned ourselves. Yeah, yeah, the team, the team approach. So think about, or I think a lot of people don't think about this. When you have the money in your non-taxed accounts, the 401Ks, IRAs, things like that, and you have to start taking things out for the required minimum distributions, that ties into the concept called sequence of returns. I feel like there's a lot of people that don't really know fully what sequence of returns risk is. So if you could define that, and then how does that layer in with when you are

forced to start taking out those withdrawals? Absolutely. And what a tricky situation that required minimum distributions or RMDs for short and deep for people. And so what happens on a sequence of returns, that's a really fancy word. And the easier way to say it is, if you're taking money out of your retirement accounts, whether for income or because you're required to for RMDs and the market's going down, that might be the number one reason people run out of money in retirement because market's going down and then you continue to take it down even further with your withdrawals. Then the market tries to recover and you sputter because you're still taking withdrawals and you don't let it fully recover. And so when you get to the RMDs,

let's say you know, you don't need to take out income, but the IRS makes you and forces you. And if the market happens to be down at that time, it can really wreak havoc on a portfolio. So then we have a lot of people ask, well, what do we do? And that's where it comes to the foundation of your portfolio. There's three pillars. There's emergency fund pillar where you have safe at the bank when you need it. Then there's the low risk where you can't lose anything in the market, but it's a really key growth component in your portfolio. And then there's the at risk where you're willing to take risk on your money. So you need that at risk to try and get higher growth over time.

You need the low risk to get good growth now also, but then you have a safe place to go to draw income when things are kind of shaky in the market. Yeah, kind of makes me think of like the diversification strategy. If you get hit hard in one area, at least you're diversified. Well, in your case, if you need some funds, you've got this account set up, this fund, this amount. And so it's kind of spread out just for your protection.

So that's huge. You know, one thing that popped in my mind with these required minimum distribution, it's not a suggested minimum distribution. It's a required. But I think that sometimes people think, oh, you know, I sold my RV last year. So I'm flushed with cash. And I don't need to pull any money out because I'm so I'm good to go. But if someone does that, they're going to incur some issues, right? As far as the leaving it in there as far as the RMD goes. Yeah, because if you don't pull it out, here comes a penalty. Yeah, exactly right. So it's one of the biggest penalties that you can incur really on your IRAs is if you don't pull it out, they're going to have a huge hefty penalty on that. And then you're still going to have to pay income tax on top of the penalty. And a lot of people don't realize that. And then when you do take it out, it can trigger all sorts of taxes if you're not planning for it. So it's kind of like darned if you do, darned if you don't, where you take it out. Now you can have Social Security tax increase, Medicare tax increase, capital gains, all sorts of. sorts of triggers and spikes that can happen if you're not planning ahead.

Yeah, all because you had a misconception of that withdrawal, like, you know, oh, I don't need it. So I'm good to go. You better do it because of all these things, multiple layers. You know, we think about taxes in retirement and those big 401k IRA type accounts that we've been talking about. Is it how do you approach Roth conversions? Because I know that in the media or online, people hear like, you know, Roth and all of that could be a good help for people, maybe not 100% of the time, but how do you

advise your clients in considering that? Yeah, that's a good thing you bring up too, because does it work for 100% of people? No, just about like any plan, it's going to be very specific to each person's needs. But what we have discovered is many, many people can benefit from getting into a tax-free space, especially if you're concerned about, as we mentioned earlier, many people believe that taxes are going to go up at some point in the future if they move. And so if you're protected inside of a Roth, that doesn't affect you and you're completely safe. Whereas if you don't take the effort and planning to get it into a Roth, you could be subject to much higher taxes in the future. And so that's kind of the game you play on the regulation risk side of things as far as tax changes go.

But then there's kind of a whole science to getting it into a Roth and paying the least amount of taxes along the way because you have to pay taxes every time you make a conversion. And that's where when we use the softwares and the huge support that we have in our retainer, we can make sure we have with precision go on in, convert the right amounts each year to make sure you pay as little taxes as possible across the board. You know, I think that's a big thing is people hear something and they, you know, it's like ready fire aim. You know, you didn't take time to aim.

You went out and Googled, oh, I heard this, so let me go out and set it up on my own, but then you might incur too much, too fast. So having that measured approach is huge. It makes me think this. And, you know, again, I'm not the one that has all the experience you do. But when someone is going to incur or trigger the taxes early now so that you can put it in a tax-free type of a vehicle, don't you need to have a good amount of years ahead of retirement so that that tax-free growth actually starts happening to compensate for the taxes that you just paid.

So how soon ahead of retirement should someone be thinking about this strategy? Yeah, that's important. That's important to keep in mind, Mike. And there's not only strategy there, but there's also rules. So when you do convert to a Roth, there's something called a five-year waiting rule where you can't take any money out of that growth before five years. and otherwise it's null and void for that portion for the tax-free status. And so you want to be aware of that first.

And then the second thing is, is strategically, usually what we've found is clients most of the time want to have their biggest, their most growth in the assets that are tax-free. And so one of the ingredients to getting growth is time. And what most people will do is they'll convert to Roth. And if they do have other taxable, whether their IRAs or non-IRAs, anything that they're paying taxes on that growth or the account, they'll often use that for income first or for withdrawal needs first, draw the taxable liability down, let the tax-free asset grow and really have beefed up their tax-free status in retirement.

Yeah, 100%. You know, and I think that all these things we're talking about, they're like tiny little, you know, chip here and a chip here and a chip here. and it just makes a big impact with taxes of retirement. Like, oh, you need to make sure this is in place. This isn't happening. This isn't draining out of the bucket. And I know you mentioned in passing the Social Security aspect.

What are some of the strategies people can be looking at considering to maximize their long-term lifetime security benefits because there's tax implications there? There's claiming implications. But where do you start with advising your clients to start considering that? Yeah, and taxes add an extra layer to the complexity of Social Security because a lot of people may not realize, and what we found to be very true is that Social Security is a very tax favorable income. And even in some of your higher income households, we're still finding that 40, 50 percent of their Social Security is completely tax-free still. And then the rest just counts toward their equation like you would for your job.

So when we're looking at that, that's a big thing to be aware of when you're planning on, well, when do I take Social Security? Do I draw it early? Do I increase it for a higher amount later? And so that's one thing to factor in. And the other one, the strong methodology, assuming there's no other moving parts, is when you have two social securities in a household and one smaller, one's larger, almost every single time, even if it's by a small amount, typically want to take that smaller one first as soon as possible, assuming you're not working and it's able to be taken fully. And then the other one you want to delay as long as makes sense in your retirement, because one of you will pass away. That's inevitability of life. and when you pass away, the smaller one always goes away. It doesn't matter which spouse,

because the higher one stays around for the surviving spouse protection. And so you need time. It doesn't make any sense to give up Social Security now to get a higher amount later if you don't draw that higher amount long enough to make up what you've given up today. So that shorter one isn't going to be around as long. You want to draw that soon as possible. That higher one is going to have the time on its side. Yeah.

Yeah, that's a good point. And there's a lot of, there's probably a whole weekend. seminar long worth of content for that. But just know that there are a lot of decisions. You can't just go click. Let's do it because once you make that security decision, most of the time, it's irrevocable. You can't just change it one year, change it back. So definitely get with someone that knows what they're doing like yourself.

Let's think about how retirees should consider the order that they draw down different accounts. So like some they might have some accounts that are taxable, some that are tax deferred, some accounts that are tax free. What is what is the strategy for the order to draw down to create that predictable income and and lower their tax taxes? When you're talking about the order, Mike, of the of which accounts you take out of, a lot of people just don't understand the impact that they can have to do it both the right way and to do it the wrong way or throw a dart at the board and just do it randomly, which is odds are you're not doing it in the exact correct way from a precision standpoint.

So what happens is that at the end of your retirement, if you haven't taken out of your assets in the right order, let's say you've got a million bucks, it could mean like five to $700,000 more net worth is what we're discovering by just doing it taking out the right way. And so it seems so simple, but it has such an impact on which accounts based on their growth, their risk, their tax status. And that's where you need to be precise. And we use really heavy-hitting tools that we use software tools to calculate exactly what that is.

And that does have a huge impact. Yeah, yeah, it really is. And I love how you've mentioned a couple times software because we don't turn our brain off and rely on software or AI or whatever tool out there. But it sure does give us a lot of help with the heavy lifting. and then the human element comes in to go, okay, here's the deal. And then when you have like this change in the software, you can go, oh, let's swap this out, this value out, because what if this happens?

And then you've got the cascading, you know, if this, then that effect. Like, well, if your income went down, then here's what that would do for the calculation. So I think that's really neat. People really appreciate having that kind of dialed in guidance. Yeah. And with the softwares that we use, you're exactly right. They're a starting point. It really

It frees us up the time To do the real important work Because when you're talking about Thousands of different ways You could claim Social Security And thousands of different ways You can adjust your risk And many different ways you can draw out of

Your assets in different orders It helps us go on in and organize that very quickly So then now we have a starting point to say Now let's take your personalized situation And see where we need to adjust, tweak, fine tune and make that work for what you're specifically trying to accomplish in retirement. Yeah, huge.

Well, Curtis, this has been really eye-opening and helpful. So if someone is interested in having a second look or a look over their shoulder on how they can help optimize or minimize their taxes in retirement, what's the best way that they can learn more and reach out and connect with you? Absolutely. We put a lot of work into providing good information education at our website. So if you want to go to www.gOSBC.net, that's www.gOSBC.net, you'll find some really good resources. You'll find the ability to contact us and get in touch with us. And I think it'll be a good experience for you. Perfect. Well, thank you so much for coming back on the show. It's been a real pleasure chatting with you.

Thank you very much, Mike. It's always a pleasure. 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. www.influentialentrepreneursradio.com.