How To Save Taxes On Retirement Income

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Hi there, Stan the Annuity Man, America's annuity agent, licensed in all 50 states, including that

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beautiful one you're sitting in. Today's topic is a weird one, but one that we need to talk about.

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How do you save taxes on retirement income? We all hate taxes, yet we're all patriots. How's

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that possible? But we need to talk about that. We need to talk about your retirement income,

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what you're going to encounter from our friends at the IRS, how to plan for that after this.

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So, how do you save taxes on retirement income? First of all, let's get something very clear.

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I'm not a tax adviser, and you should always seek qualified tax advice. That means CPA. That

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means a tax lawyer. Do not take anyone's advice on taxes except for those people that are qualified,

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that have taken the test that gives them the checkbox to be able to talk about it. I have

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a good friend who's a lawyer who specialized in taxes. My question to him was really like,

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you chose that? Like, you chose to go two or three years just doing tax law? I just love it,

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Stan. I'm like, me and you, I don't know who you are. I mean,

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you're like an alien to me. But he's the guy that I go to for tax advice.

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So, let's talk about from a layman standpoint. Stan the Annuity Man. Three decades of experience

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in this crazy world of finance. Now focused on the fixed annuity and dominating the space. But let's

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talk about taxes. Number one, for those of you that say, "Well, that's an easy one, Stan. I'm

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just going to get a Roth IRA and everything after that's tax-free." Okay, you know,

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kind of like the album thing. You've already paid a bunch of upfront taxes for it

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to become a Roth. Secondly, you trust the people that are promising that the Roth rules will never

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change. And I hope that's the truth. I mean, I really do. I hope that's right. But remember,

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there was a time where the politicians said that Social Security would never be taxed.

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Politicians have an interesting way of finagling around what they promised.

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So, if you have a Roth IRA and you buy an annuity inside of it, tax-free income,

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or you have dividend stocks inside of that, tax-free, or whatever. So,

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Roth IRA. But I'm going to put that to the side because I'm not as trusting of our friends in

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D.C. not to change the rules. I want you to envision something. I hope this never

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happens. You got Johnny politician. Johnny politician, he's standing up there talking

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about affordability. He's talking about the evil rich. He's talking about all you people

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that don't think you're the evil rich, but you qualify as the evil rich. And they say the

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following. You know these people like Peter Thiel who have a $5 billion Roth. He does,

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by the way. Look that up. These people, that's not fair. That's not fair to everyone else.

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Well, what they forgot to put in the sentence was that you, the Roth owner,

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paid an upfront lump sum, choke-a-horse amount in taxes to make it a Roth, to convert it into

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a Roth. But can you imagine that? Because Roth IRA voters are nothing. That's a voting block,

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and it's very, very small. If you're going to do Roth conversions, don't do the whole ball

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of wax. Do some if that's what you want to do and the math makes sense to you. Run the math

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numbers. So that's one way people say, well, I'm just going to get tax-free income. Yeah,

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but you, player, you've already paid taxes on it. So that's kind of the other part.

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Again, I don't sell these anymore. I did when I was at Morgan Stanley. You could do AAA

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municipal bonds. That's tax-free income that you can get. I'm not giving financial advice

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because I don't do that anymore. But this is just 30,000-foot stuff here. So you could do that.

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But what I really want you to come to the conclusion of is let's not try to not pay

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taxes. Let's try to not pay as much in taxes, because we all have to pay taxes. I guess, well,

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most normal people do. I'm sure there's these uber-super-rich that's figured out how not to

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do it. Corporations, you know, I guess that's another story. But the point is we're talking

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about me and you. We're talking about us pedestrians out here. How do we do that?

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Well, the hope is that your tax bracket, as you go into chapter two, chapter two is

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about you. Chapter two is about your income floor. Chapter two is about doing nothing or

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doing something or doing anything, but it's on your terms. That's chapter two. Hopefully,

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your income tax level is lowered because you're no longer doing that. Now, how will the government

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make up with that? I don't know. Property taxes, gas taxes, whatever. They can do that. So what

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I'd rather you focus on is not the tax part, but the income part. What is your income floor?

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In addition to Social Security, the best inflation annuity on the planet that you already own,

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and everybody out there with a Social Security number already owns, that's part of the income

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floor. Required minimum distributions, yes, that's an annuity-type payment,

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because when you reach that age of RMDs where the IRS is tapping you on the shoulder,

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that lifetime income stream, as long as you're breathing, you got to pay. As long

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as there's money in the account, you got to pay. That's an annuity. If you have a pension,

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if you're one of the 9% out there that has a pension, great. That's an annuity. That's

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part of the income floor, and you're going to be taxed on that. Period. End of story.

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When I was with Morgan Stanley, we could get a lot of very good municipal bonds back in the day. From

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what I'm hearing from my friends that are still there, my partners, my ex-partners who I'm still

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good friends with, and they're still with those big firms, they really can't get that inventory

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anymore. So I don't know what you do with all that, and I'm certainly not in that world anymore

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to even give good advice. But if you need to have an annuity advisor and you need a non-annuity

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advisor for investments, because annuities aren't investments, they're transfer risk contracts,

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non-correlated means not attached to the market. You should never buy an annuity for market growth,

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stock market growth, upside potential. Just don't. Just don't listen to that.

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But when you talk to your other advisor, or if you're self-advised, you can do the research

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yourself. I mean, you need to look at all of that from an income standpoint. What's creating

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income on that side? That's non-annuity. And do you need annuities to create income? Annuities

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can create income two different ways. You can have lifetime income stream annuities,

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which are SPIAs, DIAs, QLACs, and income riders. SPIA, single premium immediate annuities. DIAs,

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deferred income annuities. QLACs, qualified longevity annuity contracts. And income riders.

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And you can also take an MYGA, which is the annuity industry version of a CD,

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and peel off interest. That's not lifetime income, but it's still

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income coming into your bank account. That's the way to do it in the annuity world. Okay.

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Now, if you're on the investment side, you might want to look at and talk to

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your advisor. Say, "Okay, tell me about treasuries, and tell me about munis,

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and tell me about preferred stocks, and tell me about dividend stocks,

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and tell me about bond funds." Have them answer those questions. That's what they do. You know,

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my preference is you're using a fee-only advisor, not a fee-based. Fee-based,

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they can sell product and do advisement. I'm not sure I totally agree with that.

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And the other thing I'm going to tell you just real quickly is the word F that stands

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for fiduciary doesn't mean that what they say is 100% correct. Someone told me that, well,

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are you a fiduciary? I said, no, but I got a plaque on the wall that says I'm a really good

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guy. Is that sufficient to you? Because that's, in essence, what it says. In the financial business,

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we shouldn't have to have a plaque on the wall to say that we're doing the right

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thing for the customer, that we're putting the customer's interest ahead of ours. We

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shouldn't have to get certification and an F-word, the new F-word, and a plaque to say,

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"Well, he's a fiduciary." I don't care. Is he honorable or is she honorable? Are

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they going to tell you the truth brutally? Period. You don't need a plaque on the wall

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for that. Okay? If you need that, then you bought it hook, line, and sinker.

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And there's some great fiduciary advisors out there, but we've run into some scoundrels as

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well. Just like anything, there's good people in the annuity business. There's a ton of scoundrels,

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people just selling one product and selling hopes and dreams when unicorns are chasing

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the butterflies. So, when you're looking at income for retirement,

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when you're building that portfolio for your retirement, it needs to be

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kind of a two-headed monster. It needs to be the annuity side that you look at,

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and we can help you out at theannuityman.com, and/or your advisor, and the market side.

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Okay? Don't make it difficult. Financial business is not difficult. Only the

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people in it make it difficult. If you can't explain it to a nine-year-old,

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no offense to nine-year-olds, don't buy it, either side. Okay?

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Do me one last favor. Above me, hovering above my head, is a link. Hit that link. It tells the

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story about The Annuity Man, us, who we are, why we do what we do, the protocols we have in place,

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the standard operating procedures that are pro-customer that you need to know about,

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the things that you can get for free, etc., like this hat. But I'm not going

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to tell you how. If you go to our site, theannuityman.com. I'll see you next time.