Life Cycle Financial Planners, LLC

Category: News

  • Department of Labor Fiduciary Rule is DOA

    Department of Labor Fiduciary Rule is DOA

    Today, the President delayed the Department of Labor’s Fiduciary Rule that was set to take effect in April. I have been advocating for either a repeal or a delay for many months. The rule was hastily written and poorly written during the Obama administration.

    The DOL fiduciary rule attempted to legislate the definition of working in the best interest of a client. On the face of it, trying to legislate this kind of behavior is absurd. Compounding that absurdity, the regulation itself was rife with ambiguities that would undoubtedly create litigation between consumers and insurance companies, wealth management companies, banks and others. This country does not need anymore poorly drafted legislation leading to litigation over judgment calls.

    All is not lost however. I truly believe that most professionals are working in the best interest of their clients. There are, for sure, some bad actors who just don’t seem to understand this concept. They seem to be intensely focused on how much commission a product pays or how high of a fee they can charge against the account each year. They will survive changes in regulations, that is for sure. The DOL’s failed attempt here has a silver lining. It most certainly was felt by some of these bad actors as a shot across the bow. Some will be more cautious now, some may even try to up their games.

    For consumers of financial service products and advice, many have been monitoring the debate. Working in the best interest of a client is the gold standard for service. Fees and commissions are not the litmus tests. Charging fees is not better than being paid commissions. They are just different. That is an easy point to make. As one of the country’s leading proponents for life insurance without commissions, I would be the first person to say that a fee based model is better; but it isn’t.

    The right professional makes recommendations based on several factors that place well ahead of compensation. The rejection of the DOL “fiduciary rule” today will not ensure that consumers have an easy way in determining who is working in their best interest. To know that always has and always will require a bit of work. I suggest that consumers ask for referrals, speak with other professionals such as C.P.A’s and attorneys as well as local chambers of commerce leaders. Trusting your gut is also important, along with the other due diligence.

    If you would like to discuss this topic or anything else, please email Ted Bernstein or call me at: 561-869-4500

  • Make Annuities Great Again!

    Make Annuities Great Again!

    Keep current with relevant News from the Life Cycle Planners Newsletter: http://conta.cc/2iKkDkP

    Guaranteed Income Matters in Retirement

    Large amounts of guaranteed income for life is the most important asset you can own in retirement. As we get older, it becomes increasingly more difficult to manage complex investment portfolios. Many people have investment advisors to help them manage these complex retirement portfolios but as we get older, even keeping up with the minimum knowledge required to engage with advisors can be challenging, at the very least. In retirement, investment value and asset volatility are simply the wrong measures if your goal is to have stability based on guaranteed, predictability. Communicating with savers in terms of asset accumulation or the size of investment accounts can be unhelpful and some retirement thought leaders would suggest, even misleading. 

    There is a disconnect caused by how the brokerage industry expresses the value of what matters in retirement. This disconnect is putting people at risk without sufficient reward. You must ask yourself what is more important, guaranteed principal protection or a few more percentage points of yield? 

    Can you afford to lose 30% of your retirement assets at this point? It just happened to millions of people in 2008. If you were one of those people, can you afford to lose principal again?

    Maybe the more important question we need to be asking is this: What is the upside for taking on this risk? From my perspective, the risks far outweigh the rewards. Do you believe the market has a greater chance of being up 30% from here or down 30% from here?

    There Is A Better Alternative:

    Considering that you CAN participate in market gains when there are gains to be had and NEVER lose principal when the markets are down! Don’t choose to forego the protection guaranteed by the insurance company? In most cases, the insurance companies are rated better than the stocks in your portfolio. Doesn’t that say a lot?

    Using an indexed fund, you can be in the market and benefit from the gains without putting your retirement assets at risk. Would you rather have an unprotected account made up of equities whose value can decrease by events for which you have absolutely no control?

    With this better alternative, you can “flip the income switch” whenever you choose and begin to draw a guaranteed, lifetime income stream that can NEVER go down, for as long as you live.

     Nothing else can do this. It is that simple – that cut and dry.

     Guaranteed Income + 100% Liquidity is finally being recognized as a powerful combination for retirement security.

    Lifetime income will hedge away longevity risk and 100% liquidity of assets ensures flexibility with the ability to maneuver when necessary. It is more important than ever for people to understand the difference between asset accumulation in retirement versus guaranteed, lifetime income streams. Until now, the primary goal has been to increase your assets in order to draw them down in retirement. Professors at leading universities and retirement centers around the world are now asking retirees to re-think the conventional wisdom. Using the right annuities that guarantee liquidity from day one, you can have your cake and it too.

     “A portfolio of stocks and bonds cannot provide a guaranteed income for life, with Zero risk. On the other hand, the right longevity annuity contract does GUARANTEE you will never lose a dollar’s worth of principal and it will guarantee income you cannot outlive. Today, people want to protect their IRA assets and their personal retirement assets from any market loss and interest rate risk. But, they want some upside when the markets are up. I am not against having assets in the stock markets but I am against having retirement assets in the stock market WITHOUT AN INDEXING WRAPPER TO PROTECT THE ASSETS FROM LOSS. Whenever we encounter a client without the wrapper, we ask one simple question: ‘Why; what benefit are you getting from investing without the protection?’ Once people understand these specially designed tools work exactly this way, they re-balance immediately since there is no downside.

     If your understanding of a longevity annuity is different than this, please contact me. I will clarify and answer any questions on a complementary basis.”

    Ted Bernstein, Boca Raton Tribune

  • Today Show: Make your money last with an annuity

    Today Show: Make your money last with an annuity

     

    The Today Show this week includes an important recommendation about guaranteed, lifetime income. Although 2016 was a banner year for indexed annuities, we have a long way to go. Too many people do not understand indexed annuities and as a result, they are still measuring their retirement security by the size of their portfolios. As this story points out, you want to “convert” your retirement assets into an income stream that will last as long as you do. Guaranteed income in retirement is the gold standard for security.

    “Building block 2: A Fixed Annuity.

    Consider converting a portion of your nest egg into a fixed, immediate or deferred annuity that will cover the gap. Essentially, you’re using part of your nest egg to buy a paycheck that can be structured to last as long as you (and perhaps your spouse) live.” 

    http://www.today.com/series/starttoday/jean-chatzky-how-make-your-money-last-after-retirement-t106561

    If absolute security is a primary retirement goal for you, please contact me to arrange a discussion about guaranteed income solutions. There are dozens of threats to your nest egg in retirement and I will explain how to mitigate them with the power of guaranteed income contracts. You will not learn about these strategies from traditional money managers. You can email me or call me directly at 561-869-4500.

     

  • ROI = Reliability of Income

    ROI = Reliability of Income

    In Retirement, ROI is Reliability of Income. Helping you shift your focus from asset accumulation to guaranteed income will create more security in your retirement plan. Economists, professors and thought leaders all over the world are helping planners and their clients change the dialogue about why sufficient levels of lifetime income are more beneficial and valuable than asset accumulation in retirement. If your goal is maximum security without principal risk, you will benefit from this shift in focus.

    The financial risks of living longer.

    We strive to create a long, healthy and enjoyable retirement. That is a reality if you are well positioned in retirement with reliable sources of income supporting your lifestyle. The financial downside of living longer is the increased risk of outliving your wealth – referred to as longevity risk. Many professors and economists believe it is the single biggest threat in retirement.

    Warren Buffett (that wise, wise man from Nebraska) said, “that in order to succeed, you must first survive.”

    When it comes to retirement income, investors are dramatically underfunded, but that trend might be changing: Willis Towers Watson’s 2016 Global Benefits Attitudes Survey found 59 percent of millennials and 66 percent of Baby Boomers are willing to pay a higher amount for a guaranteed retirement benefit. The data suggests that people with guaranteed income in retirement are happier than those without it.

    Protecting your spouse.

    For couples, joint annuities allow a steady flow of income during each spouse’s lifetime and after the first death.  Compared with a single-life payout, a joint payout will pay less each year, but the guaranteed lifetime income for your spouse will take care of her in a way that nothing else can. Managing a complex investment portfolio for a surviving spouse is challenging on nearly every level. Converting your retirement assets into guaranteed income streams is retirement planning state of the art. The assets remain 100% liquid and there can be no losses. Gains are added to the principal.

    Further, I believe that guaranteed monthly income payments are perfectly suited to offset the risks of health changes and normal cognitive declines.

    How to Manage Longevity Risk.

    Ideally, you need guaranteed, lifetime income streams that provide income for as long as you are alive, under any conditions. You, nor your spouse, can outlive guaranteed, lifetime payments from an insurance company. Too many people in or near retirement are invested too heavily in the stock market, creating a real threat to their nest egg when the market has a normal correction. By re-balancing your portfolio, you can move these assets out of harms way and put a protective wrapper around them.

    Absolute security in retirement requires that you convert a portion of your retirement assets, including IRA monies, into reliable lifetime income from insured contracts that create guaranteed income from insurance companies. Working with experienced retirement professionals ensures your heirs will receive all unpaid principal if that is your goal. 

    According to Yale Professor, Roger Ibbotsen:

    “Investors should be willing to pay an insurance premium to hedge away the longevity risk.”

    You need guaranteed income solution if you are:

    • At or planning for retirement.
      • Concerned about outliving your money.
        • Concerned about spouse’s well-being upon your death.
        • Currently have retirement assets invested in bonds, stocks or real estate.
        • Have insufficient guaranteed lifetime income.
        • Concerned about losing investment control as you get older or if health is compromised.
        • Do not have a plan for retirement or longevity risk.

    A Private Pension – How it Works.

    There is no principal risk. A longevity annuity is designed using indexing strategies. Simply put, this means there is a guaranteed floor of 0% and reduced gains on the upside. When the market is up, the contract will capture some of the gains and when the market is down, there are NO LOSSES as you contractually cannot earn less than 0%.

    Return of Premium – I recommend contracts that are 100% liquid from day one (minus any disclosed contract fees). With this special guarantee in place, you are protected from unforeseen events or a bad decision. With all of your capital GUARANTEED and LIQUID, you have the freedom to take advantage of “better” contracts if it makes sense to do so in the future. Without the traditional surrender penalties levied against your account if you change your mind, threats from inflation are minimized.

    Mortality Credits.

    There is no other investment that guarantees income for life without ANY principal loss – ever. Because insurance companies create assets called mortality credits and then share them with their annuity clients, they are able to do what no other investor or company can do. The word guarantee does not apply to the world of equities. Longevity annuities are built around guarantees and this is quite a distinction offering you real choices.

    Income for life, 100% liquid from day one, guaranteed principal protection and tax deferred growth. A secure retirement plan should be built on this foundation. An advisor who is experienced in retirement and longevity planning will prove to be invaluable to helping you create reliable income you cannot outlive. In retirement, an income advisor will become the most important member of your team.

    If guaranteed lifetime income is a primary retirement goal for you, please contact me to arrange a discussion about helping you with retirement security and the power of guaranteed income. You will not learn about these strategies from traditional money managers. Please email me or call Ted Bernstein directly at 561-869-4500.

    Ted Bernstein, Life Cycle Financial Planners

  • Long Term Care Covers More Than You Might Think.

    Long Term Care Covers More Than You Might Think.

    Most people report uncertainty about the definition of claim triggers in their long term care insurance policy. My experience confirms that people want a better understanding about what IS covered and what MAY NOT be covered. You will be surprised about today’s long term care policies and find they DO cover you when you need it most.

    The issue of Long Term Care is at the top of the list of retirement threats facing many of us. It is one of the largest uninsured financial risks facing the elderly in the United States today. Incredibly, long term care represents about 8½ percent of all health care spending for all ages and more than 1 percent of GDP.

    Eligible claims: Let’s focus on what many people find confusing – benefit triggers and when can you claim? For example, the REQUIRED wording for chronically ill is:

    1. You cannot perform at least two activities of daily living without substantial assistance for at least 90 consecutive days; or
    2. Cognitive impairment issues creating and requiring supervision in order to protect you from health and safety threats.

    These are standard and straightforward definitions. Being aware of them will lead to the receipt of proper benefits under the contract. 

    The benefits are in the details! Looking closer at number One:

    ‘You cannot perform at least two activities of daily living without substantial assistance…’ Does this definition require the insured to be sick in order to meet the chronically ill definition?

    No. These benefits are triggered by a loss of functional capacity – meaning you cannot manage Activities of Daily Living  (ADL) without assistance.

    Activities of Daily Living (ADLs) are defined as “the things we normally do… such as feeding ourselves, bathing, dressing, grooming, work, homemaking, and leisure activities”.

    Eligibility of claims in these cases IS NOT tied to a specific diagnosis or injury. You are not required by the policy to have MS, Parkinson’s, a stroke or any other diagnosed medical condition. You might be 70 years old or 85 years old – that does not matter.

    A large number of people receiving long term care benefits do have one or more chronic conditions but do not have a catastrophic diagnosis. They are still eligible for claims under the right contracts. 

    Without a doubt, the longer we live, the more likely it is that we will need help with our daily living activities.

    Fortunately, being sick is not a requirement to receive legitimate benefits.

    Please feel free to contact me to arrange a consultation about long term care.  There are dozens of threats to your nest egg in retirement and I will explain this one and any others you wish to discuss. You can email me or call me directly at 561-869-4500.

  • The Value of a Professional’s Advice

    The Value of a Professional’s Advice

    Professional Advisors Vital to Financial Health.

    Make no mistake about it. The research continues to confirm that getting advice from professionals is beneficial in every measure: insurance, retirement planning, investing and quality financial plans.

    • Within 4 to 6 years, households who used advisors accumulated 58% more assets than those who self-directed their investments.
    • Using a professional advisor for 7–14 years essentially doubled the wealth accumulation of those without an advisor.
    • After 15 years, households held 2.7 times more wealth than those who did not seek professional guidance.
    • No other strategy guarantees lifetime income with no principal risk like indexed annuities.

    These are NET RESULTS after taxes and accounting for the costs of the professional advice.

    Advisors encourage their clients to save twice as much while simultaneously helping their clients develop long-term insurance, investment and retirement plans.

    advice-we-can-help

    The Growing Demand for Advice.

    Millions of people benefit each year from the value of annual reviews. Life Cycle Planning is financially rewarding and leads to more security. We will continue to demonstrate the value of professional advice by offering the best products, solutions and service to our clients. Please call us at 561-869-4500 or email me to arrange a complementary meeting to discuss how we may help.

  • Everyday Tips For Longevity In Retirement.

    Everyday Tips For Longevity In Retirement.

    1. Time passes faster every day. Don’t make it worse by rushing and stressing over time. Where are you going?

    2. Take care of your body so it will take care of you later. Don’t let your world get smaller each day – stay fit and mobile.

    3. Intimacy and friendships remain important regardless of where you are on the life cycle spectrum.

    4. Healthy relationships are the most important thing in your life. Steve Jobs at end of life:

    While the above-quoted essay does not represent either Steve Jobs’ final words nor remarks he made (in either oral or written form) at any time during his life, his biographer Walter Isaacson did record Jobs’ expressing regret at the end of his life about how he raised his children:

    “I wanted my kids to know me,” Mr Isaacson recalled Mr Jobs saying, in a posthumous tribute the biographer wrote for Time magazine. “I wasn’t always there for them, and I wanted them to know why and to understand what I did.”

    “He was very human. He was so much more of a real person than most people know. That’s what made him so great,” he added. “Steve made choices. I asked him if he was glad that he had kids, and he said, ‘It’s 10,000 times better than anything I’ve ever done’.”

    It wasn’t always thus. In the early stages of his career, Jobs, who was adopted, denied being the father of Lisa and insisted in court documents that he was “sterile and infertile”. He acknowledged paternity when she was six, and they were later reconciled.

    5. Money talks. It says “Goodbye.” If you don’t convert assets in the market into guaranteed lifetime income, you’ll wish you had. And then it’s too late.

    acceptance

    6. Many of the seeds you planted in the past, some good and some bad, will begin to bear fruit and affect the quality of your life as you get older.

    7. Acceptance is grace, freedom and peacefulness.

    8. Don’t let your possessions own you. Consider them on the trouble vs. enjoyment scale. Simple but enlightening.

    9. You may regret some things you didn’t do far more than the ones you did that were “wrong”.  If you get the chance — do them. You may not get the chance again.

    10. Every day you wake up is a gift.

    11. Converting retirement assets – stocks, bonds, CDs and Treasury’s – into a Longevity Annuity will eliminate risk, guarantee income for life, allow you to enjoy retirement and sleep at night. Do you want to receive guaranteed monthly income, paid to you no matter what? Or, do you want to be responsible to mange a complex investment portfolio into your 80’s and 90’s? Talk to friends and others who receive large amounts of guaranteed, lifetime income and ask them for their opinion about this critical issue.

    If guaranteed lifetime income is a primary retirement goal for you, please contact me to arrange a no obligation discussion about my views concerning retirement security. There are dozens of threats to your nest egg in retirement and I will explain the power of guaranteed income contracts and why you will never learn about these strategies from traditional money managers. You can email me or call me directly at 561-869-4500.

     

  • 2016 Election and Your Retirement

    2016 Election and Your Retirement

    The 2016 Elections are over, and now you should learn on how this will affect your retirement.  Here are a few resources to help clarify the change of landscape:

    What a Trump Administration Means for Your Retirement

    What impact will a Trump presidency have on the 46 million Baby Boomers living in the U.S.?  President-elect Trump, a Baby Boomer himself, has his work cut out for him when it comes to dealing with Social Security and Medicare.  READ MORE

    Why The Roth IRA May Be Big Winner In 2016 Presidential Election

    With the 2016 presidential election behind us, we can all start thinking about what this country will look like under President Donald Trump.  Notwithstanding all the pre-election campaign rhetoric about immigration, foreign policy, etc., one thing we are quite certain about is that President-Elect Trump is serious about reducing personal income and corporate tax rates across the board. READ MORE

    The Real Lessons the Presidential Election Holds for Your Retirement Strategy

    Since last week’s presidential election, we’ve seen a deluge of investing and retirement advice. Some is perfectly reasonable: Don’t make any radical moves in your 401(k)! But some recommendations, such as putative ways to “Trump-proof your portfolio,” are in my opinion questionable to say the least. READ MORE

    If you would like to take that first step, please drop me an email, or give me a call.  I am Ted Bernstein, and I will answer any questions that you might have. No stress, no pressure, just a simple first step in the process.

    Please call me at 561-869-4500 or email me at tb@lifecycleplanners.com

  • 3 Simple Retirement Questions To Ask Yourself.

    3 Simple Retirement Questions To Ask Yourself.

    Lower Your Stress About Retirement

    These 3 Simple Questions About Your Retirement Will :

    1. Do you have any plan at all about retirement besides social security and/or a pension?

    Over half of all Americans have never made any retirement plan whatsoever, and another 23% have never done any sort of calculation on how much they will need to retire. Doing nothing is not a plan, and it is not as difficult as you might think. You don’t have to stress about calculating perfectly for how much you will need, but you just simply need to start. Remember: The earlier you start planning and doing something about your retirement, the more painless it is.

    2. Have you done any thinking or estimates on how you will handle health care costs after retirement?

    Over 3/4 of Americans have to take from their retirement savings and income to pay for unexpected health care costs during retirement. The trick here: prepare for the unexpected.  By simply knowing a few things on how to fill the gaps of your health care coverage after retirement, you won’t need to worry about raiding your retirement savings.

    3. Be Honest, Did You Assume You Will Work Steadily Until Retirement?

    Over 55% of Americans in a recent poll stated that they plan to work until they are 70 or over and are planning accordingly. However, almost 80% of Americans retire before the age of 64. There is a major disconnect that we have about how and when we actually retire.

    So, you answered these questions and are now thinking, “What am I going to do about retirement?” -or- you move on with your day and figure you will deal with it some other time.  That is understandable, it is not fun.  But it is just like preparing for a test.  As long as you haven’t studied, there will be stress.  Once you have done the studying, the stress goes away.

    And you don’t have to solve all of your retirement problems in one meeting with a professional.  Just dip your toe in the water, and start by simply learning about some options.

    If you would like to take that first step, please drop me an email, or give me a call.  I am Ted Bernstein, and I will answer any questions that you might have. No stress, no pressure, just a simple first step in the process.

    Please call me at 561-869-4500 or email me at tb@lifecycleplanners.com

  • Beware of Bad Financial Advice.