Hello and welcome back to another episode of the Retire Once show. I'm your host, Jonathan Rankin, the founder and CEO of Theorem Wealth Management. I'm joined, as always, by my lovely co host.

Hi, I'm Melissa Rankin. Thank you so much for joining us.

Thank you for being here. We have a great show for you today. We're going to be talking all about mistakes that people make in IRAs, as well as some issues that economists believe might be holding back retirement plans in the future. So we're going to dig all into that in just a few moments. But before we do that, what do we want people to do?

We want you to subscribe. We want you to never miss one of these episodes.

Don't miss a single one. Also, make sure that you sign up for our weekly retirement newsletter. It is good stuff. So it comes out every single week. There's a link in the description below, so make sure you sign up for that. But let's jump right into it. So Morningstar came out with this list, an article they came out with that listed the 20 mistakes that investors make.

With IRAs, which I love how there's 20.

That's a very long list.

It's a long list. And also, who isn't making one of the 20? I mean, come on, 20 mistakes?

Well, that is a lot. But let's just I'm assuming and I believe that none of our clients are making those mistakes. But for those who aren't our clients, we want to make sure that you're not making those mistakes either. So let's dig into them. Mel, if you want to kick us.

Off, jump into the first of the 20 waiting until the 11th hour to contribute to an IRA.

So this is talking about how if you're contributing to a traditional IRA, a Roth, or even sometimes a Sep IRA, you have the ability to contribute all the way up until the tax deadline. And by waiting until that time frame for in April to contribute, you're losing the ability for that money to compound. So they talk about instead of doing it at the very last minute, try to do it either installments over the previous year or just do it the year before.

That seems like the best bet.

It does. But I understand if you're a business owner and you're contributing to a SAP IRA, you may not know if you're going to have the cash flow until that following year and you're doing anything you can to reduce your taxable income. So I get it that there's a reason why people wait until that last minute, but it does take away some of the compounding impacts that money can have.

Not to mention that something could go wrong. I mean, we see it a lot where people wait till the last minute and then who knows, maybe you can't move the funds right away. I mean, there's lots of stuff that could go wrong. I think that one's a good way to kick it off because it kind of goes to show, like, probably don't procrastinate fascinate.

Yeah. But it is also something that I don't believe is going to drastically ruin your retirement. This isn't one of those yeah, it might ruin your day if you can't do if you missed out on being able to do the contribution because you waited. But this isn't something where you're going to look back and be able to quantify what that compounding would have been. It'd be too hard to try to back that number out. So I do see this as an opportunity to make retirement maybe a little bit better. But is this something that's going to completely ruin your retirement if you're waiting to the last minute? No, I don't think so. Okay, so not going to ruin your retirement, but also try to avoid it.

That's right.

Number two, assuming Roth IRA contributions are.

Always best, I feel like this is a lot more popular these days because of how popular the Roth IRA has gotten, especially with articles about the PayPal founder who's got $5 billion in a Roth IRA. And everybody wants that tax free distribution, the tax free growth. And I get it.

Roth doesn't want tax free.

They're great. But as we've always talked about, roth IRAs are beneficial when you're trying to figure out what tax bracket you're in today versus what you're going to be in a retirement. You don't have to just put everything into a Roth IRA now because it sounds great in theory. If you're at a high tax bracket today and you're expected to be in a lower one in retirement, well, you're missing out on the tax benefit of that traditional IRA. So it's not always the best thing just to go with what's popular in the headlines these days.

Okay, so number two, don't always go with what's popular. Number three, thinking of IRA contributions as either or decisions.

I see this a lot with 401 KS, especially now that Roth 401 KS have become a lot more popular. But the thought of you can only do a Roth or only a traditional, you can do both. And so being able to diversify your tax base is really going to be important when you're in retirement. We've talked about that before on this show about having that asset location diversification. When you're in retirement, to be able pull funds from different sources is very beneficial. So if you're contributing to an IRA or even a 401K in this matter, you could do both. There's nothing that says you can't do both.

It's not very black and white. It's not this or that.

Exactly. So you can do both if you want to have both of those pre tax and post tax in retirement.

Okay. Number four, making a non deductible IRA contribution for the long haul.

So this is where you're contributing to a IRA. But you're not taking the tax deduction. And it's really utilized, in my opinion, only for being able to do a backdoor IRA contribution. Now you can just invest the money in a IRA and you don't have to deal with the capital gains tax or anything like that if you're putting in after tax funds. But there are RMDs, and it's really not the best place to save if you're trying to do that for, as they say, the long if. The only way that I think a after tax non deductible contribution to an IRA makes sense is if you're doing that backdoor Roth contribution, which is actually.

Perfect segue for number five. Assuming a backdoor Roth IRA will be tax free.

Yeah, this is something that as a Roth IRA has gotten more popular. We've seen quite a bit of people asking about this maneuver. But if you have any IRAs out there is this pro rata rule that can impact your ability to do a backdoor Roth. And then the other thing is that if you have gains and I've seen this a lot in 401 KS where people try to do a mega backdoor Roth, they contribute after tax funds into their 401K in the anticipation that they're going to convert those into a Roth. But instead of immediately converting them, they're invested and now they've got gains associated with it. So all those gains are going to be taxed at ordinary income tax when they do that contribution. So it's not a zero sum game of taxes if you're doing it at a later date.

If you're doing it, you want to make sure you're consulting a tax professional or financial advisor. But really it can be tax free. It just depends on your individual circumstances, which makes sense.

And that actually leads into number six assuming a backdoor Roth IRA is off limits because of substantial traditional IRA assets, you got why that one seems so hard.

And this is because of that pro rata rule. A lot of people feel, well, I can't do this backdoor Roth IRA because of that pro rata rule and it's going to really be kind of a pointless exercise to go through. But if you have the ability to roll your funds from an IRA into your employer 401K, this removes them from that IRA universe, we'll say, and allows you to do that backdoor Roth IRA conversion. So there is a way around it. There's just multiple steps you have to go through, like I said, Roth IRA conversions and backdoor Roths mega backdoor Roths very confusing and can lead to major tax consequences if you get them wrong.

So that's why I put some of those mistakes, to me more at the top of the list because with how popular Roth IRAs have gotten, this strategy has gotten a lot more hype these days and more people are wanting to do them. But if you're not fully understanding what the ramifications you could end up with a large tax bill that you weren't hoping for.

So all of those concerning backdoor Roths, I mean, there's three points here that are on the list of 20. So, I mean, good to know. Shifting gears a little bit. Number seven, not contributing to an IRA later in life. This one we hear a lot.

Yeah, but this is also I don't think this is going to make or break your retirement. If you're in your 60s or seventy s and you're retired, but you still have some maybe part time income and you're just not contributing to a retirement plan. Yeah, it's great if you can if you've got that earned income and you want to continue to contribute to either a Roth IRA or a traditional IRA at that time, but especially a Roth, because if you have earned income and you're not expecting to actually use that money and you're going to pass it on. It's much more beneficial in that. Roth IRA structure.

But a lot of people aren't in that position where they're retired, still have some earned income, and they just have this money that they're going to be earning for no reason other than just to give away. There's a lot of conditions that have to be met around that one.

I get that it's a great place to save. IRAs are always a great place to save, especially if you're older and still working. But are you really retired if you're working and still saving?

Are you hitting all of those buckets to make it worth it again? Okay, so moving on. Number eight, forgetting about spousal IRA contributions.

This is a big one, especially for families who have one spouse that stays at home, because you have the ability, if there's income that's coming into the family, you have the ability to do a spousal IRA. And so typically you'll see a household where one spouse stays home and the other is working, but that working spouse has all the retirement assets and they're not leveraging that spouse or IRA. So if you do work and a spouse stays home, you can contribute to an IRA on their behalf as long as there is earned income in the family. So that is a big one. That it's a really big one. You can just add that over time, and that compounding is going to really make a big impact later on.

So spousal IRA is very important. Number nine, delaying IRA contributions because of short term considerations.

I see. This is a lot, as they mentioned the article, for younger investors, that life gets in the way and you go, well, I don't want to contribute to this account because I want to buy a home or I've got to buy a car. I've got kids that are going to college. And the thought that, all right, I'm in my 20s or 30s or maybe even forty s, and this money I'm not going to be touching for 20 plus years. They talk about in the article, where, especially in a Roth IRA, you have the ability to take out your contributions without paying taxes. However, what I don't like about this is it talks about tapping into an IRA and utilizing it as funds that you can use just for yearly living.

Almost like a savings account.

Yeah. And I don't think that's the way that you want to think about it. With retirement accounts. The most successful retirees that we come across, IRAs, 401, KS, Roth, that's a set. It forget it. I'll touch it when I'm in my.

60S, out of sight, out of mind.

Exactly. Just forget you have it.

Whereas if you're in that state of mind of, well, if I can contribute to my Roth when I need funds, I'll just tap back into that. If you're in that habit, it's never really going to be fully matched.

You're never going to get ahead.

No, because people are there's always something you could spend money on. We talk about all the time. There's always something you can do. Go experience special vacation. Exactly.

Trip, anything. Okay. So number ten, and I'm going to read it just as they wrote it in the article. Running afoul of the Roth IRA, five year rule.

Yes. If you run afoul of this rule, this is the rule that says you have to had the Roth IRA open for at least five years before taking withdrawals from that. Even the contributions, because this is a big one with investors who are over 59 and a half. Because typically once you turn 59 and a half in a 401k or IRA, you can take money out of your retirement plan and there's no issue. But in a Roth, let's say you open it up and you're 59 years old and you retire at 62. You got to be careful because that IRA hasn't been open for five years. So you want to delay taking distributions from that Roth until you hit that five year mark. This is really a big one. That can cost some taxes.

Yeah. You really don't want to be running Afoul.

No. Don't run. Afoul.

That number eleven. Thinking of an IRA as Mad Money or Monopoly Money.

I like your version of Monopoly money better. This is important because with that IRA being that 2030 year account that, hey, I'm not touching this for a long time. There is this common thought that I could just take more risk in this account. I'm not touching it for 30 years. So I can day trade this account. Or I can oh, it'll bounce back.

I can go all in one certain stock. And it's not meant to be your Mad money or Monopoly money, as you say. It's really there for a long term retirement growth account. And so if you want to have a small play account, that's your fun money, as we always like to call it, then that's fine. But if you're doing that with all of your retirement assets and all of your IRA, probably not a good idea. You're going to run into a big problem at some point because I've never met anybody that has timed the market perfectly and taken all this risk and always gotten everything right. Everybody's going to tell you about wouldn't.

That be nice though?

It would. Everybody's going to tell you about the great trades they made, not the ones that cost them the 50 or 60%.

People don't usually talk about all the mistakes they made.

No. Which is why we're talking about them.

Exactly.

To help you avoid them. Okay, number twelve, lost where I was at.

This is a long list, so we appreciate you sticking with us.

Absolutely. We're only at twelve. Missing out on the chance to fill holes with an IRA.

So this is where you can in a 401K you are typically limited with the funds that you have. A lot of 401 KS, they've got your large cap growth, your large cap value, and maybe a few bond funds. But utilizing an IRA to really fill the gaps on the portfolio side. So where we've seen this in real life use is on the bond side because most 401 KS will have either just an investment grade bond fund or in a short term fixed income fund that's similar to a money market. But if you're wanting something different like Tips, maybe treasury inflation protected securities or high yield fixed income. And on the stock side, there's no way to really have a sector play or individual stock play inside of a 401K. Very rarely do they have sector funds. If they do, they're pretty limited.

So using an IRA to really build out that complete portfolio and this is where I see people get into an issue is where they have their IRA one side and they're managing that in a vacuum and they're not factoring in their four hundred and one K and they've got this 401k that they're just allocating without even thinking about the IRA. You've got to get a full, got.

To be a cohesive unit. It does. And that's where the most successful investors that we see, how they look at it, they will look at all the assets combined, and they'll say, well, if I've got all my large cap growth in my 401k, well, in my IRA, I'm going to do things like large cap value or small cap or just other things that are not in my 401k. I'm not going to just double up and go all in on a certain category. It's really about building that portfolio where something's always making you mad. That's how you know you have a fully diversified portfolio. When you look at your portfolio and something is just bugging you because if everything is going up at the same time, it's not a diversified portfolio. That means it's fully correlated and there's no diversification.

There okay, so another important one, number 13 doubling up on tax shelters in an IRA.

Hey, I love muni bonds like the next person, but if you're putting them in an IRA, you're doing yourself a disservice. Don't do that. And that's really what we see is if you're buying muni bonds in an IRA or if you're doing that even in a Roth, there's just no point to do that. So yeah, don't double up on tax shelters. Once again, not going to make or break your retirement, but you're just missing out on gains that you should have gotten if you were investing in, let's say, just traditional bonds because you're not getting that tax benefit of the tax free interest there.

So another important one, number 14 not paying enough attention to asset location in an IRA kind of goes hand in hand with the it does in previous one. We talk about asset location a lot. It's not something that's often brought up, but this is where I see this all the time, where somebody might have a portfolio that their taxable account looks exactly like their IRA, which looks exactly like their Roth. They'll mirror each other, which is, hey, it's at least one cohesive strategy. However, when you're dealing with tax or asset location, now is where you can be a little bit more tactical on what assets are in each tax bucket. So higher yielding securities like high yield bonds or REITs where they've got high income, those are great for a traditional IRA.

Whereas things that are more growth oriented, like growth stocks and have more long term appreciation potential can go into a Roth IRA, there might be a little bit more tax advantage there, assuming that there's more long term growth in those than there is in high yield bonds. So just paying attention to where you're investing the money in each account is going to be important. Once again, not going to make or break your retirement if all of your accounts look the same. But can you make your retirement that much better? Can you kick it up a notch? Was that emerald lagasse? Take it up? I don't know. Someone said, yeah, oh, I don't know, take it up another notch, or something like that. Somebody had that if you know who had the saying, just kick it up another notch, please let us know. We'd like to give them credit on. I would, yes, absolutely. And number 15, triggering a tax bill on an IRA rollover. Big one. It's huge. This one can ruin your retirement. This one, absolutely. I've seen this from time to time, especially because a lot of 401 KS will issue a check. If you're doing a rollover from your 401K into an IRA, they will often issue a check payable to the institution you're going to but for your benefit, and that check is going to you. So you've got this check. And I've seen people say, well, I'm going on vacation. I'll deposit this when I get back. You've got 60 days to get that into the account. You get past that 60 days. Now it's a taxable distribution, and that can be a huge tax bill. And it seems like 60 days. I think people hear that and they're like, two months? Obviously I'll get to it. Yeah, of course. But you'd be surprised how, unfortunately, often this happens. Yes, it happens more often than I wish I'd seen. But that is, to me, one of the biggest ones that can really that. Should be a little closer to the top, because this one, no particular order. This one can absolutely ruin someone's retirement if you get a 100 or $200,000 tax bill. Because remember, traditional 401K assets, if they become taxable, all of that money is taxable. All of it.

So if you got a million dollar, you didn't cash that check in time or deposit that check, that's a million dollars of taxable income in that year. So that's going to push you to a much higher tax.

Don't do that. Don't make that mistake. For sure. No, and not only that, but it comes out. You kind of figure it out later on. The IRS will get to you once you go to file taxes. And then, because most people didn't think about it, even if it's, let's say, day 65, contribute the money and you go, well, wait a minute, why am I getting this letter from the IRS saying that I owe this much in taxes? I did the rollover. But if you miss that 60 day window, you can cause yourself a very big issue. Very big. So definitely try very hard not to make that mistake. Number 16, not being strategic about RMDs from a traditional IRA. This is a popular one. This is and this is where being able to use RMDs to really strategically rebalance your portfolio. So if you've got something that's done extremely well, let's say this year, you've got Nvidia stock and it's just done extremely well. Well, maybe think about taking your RMD from that holding. So by default, you're selling things at a high, and you're using it as a chance just to rebalance your overall portfolio. Once again, not one of the mistakes that's going to ruin your retirement, but this is taking it up another notch. Really just fine tuning it, making it that much more tax efficient.

So definitely not like the 60 day rule, but still important. Exactly. Number 17. We're almost done. Thank you for sticking with us. I know 20 is a lot, but we feel like we've got to go through them. If they wrote it, we want to go through it because we want to. Help you avoid these. Exactly. Number 17, not reinvesting unneed RMDs from an IRA. Got that one. It seems like AII. Don't know, but it seems like unneeded. Big word. I know. It's got the double N there. Double E. No. So this is to me an important mistake because I see this where you take a distribution because you're forced to because of RMDs. But if your withdrawal spending is, let's say, 5% or 4% of your overall portfolio, but now you're withdrawing six or 7% because of RMDs and maybe other distributions that you're taking, this could just have you take out more. Than you need to and cause you to spend more than you really needed to, which might not be what was built in your initial retirement plan. So if you're going to do anything with that money, you can put it back into a savings account. If you've got earned income, you can reinvest it into a Roth. But just taking it out and sitting it in cash, a lot of people find ways to spend that cash, and that could just cause you to spend more than what your initial retirement plan could have been. So something to keep definitely in the forefront of your mind. Exactly. Number 18 not taking advantage of qualified charitable distributions from an IRA. Once again, if you're contributing to a charity, it's not going to be ruined. My assumption is your retirement is not going to be ruined. I feel like that's a safe assumption.I would imagine that it is. But directing RMDs to a charity directly can offer some really good tax benefits. So if you are doing any sort of charitable contributions or charitable contributions, then doing it directly from your RMD can be a lot more beneficial than just giving them a cash. So if you're doing philanthropic giving, it's just something to keep in mind to take it up another notch. We're really going to need to know where that came from. We are definitely number 19, not paying enough attention to IRA beneficiary designations. This is huge. This one can ruin this one's not going to ruin your retirement, but it could ruin your kids or whoever, somebody, and we see this a lot is with divorced spouses. And so making sure that if you go through any life change, that you're at least checking your beneficiaries. If you're moving jobs, if you're opening up an IRA and you just did it initially to just get it open and you didn't list any beneficiaries, just make sure that everybody's listed the way they should. It's just something to keep in mind and update on an ongoing basis as there's major life events. I mean, that's a big one, like we said, that unfortunately, you'd be surprised how many people are like, oh, I completely forgot, or that just didn't cross my mind. So that's a big one in my opinion. And last but not least, finally, we're number 20 not seeking advice on an inherited IRA. This is probably one of the most frustrating ones that I've seen. Yes, because the inherited IRA used to be very simple. And then the IRS, the government, whoever came up with the rule decided, you know what, inheriting assets shouldn't be easy. We should make this more difficult. You're not only dealing with a loss of a loved one, because if you're getting money from someone, I'm going to assume that you're close to them. So you're not only dealing with that loss, but now you have to deal with the pain of figuring out this inherited IRA, which is by far the most confusing. Usually a nightmare. It is. And now that they stretch, IRA is gone and secure Act One, secure Act Two, and all those different things. It's extremely frustrating to know the rules. So that's an entire conversation on its own. And we've done a video on that. We'll make sure to link to that as well, and probably be doing another one because there's been some updates with those. But if you've inherited IRA, all I could say is just ask for advice. Yeah. Don't try to tackle that on your own. That is just a mess. It could be very difficult to figure out the taxation of when you need to take distributions. And if you're going beyond the ten year rule, if the tenure rule applies, you all those different things. Yeah, there's a lot to dig into on the inherit IRA. The best thing you could do, just ask someone. If you don't have, you can email us, schedule a time on our calendar. We'd be happy to help you with that. But inherited IRAs very frustrating. Absolutely. So now that we've covered all 20 of the mistakes, let's shift gears a little bit. Let's go through the seven great challenges to retirement plans from advisor perspectives. Yeah, this is a very interesting article and I'm anxious to see your thoughts as we go through this. So go ahead and kick us off with the first of the great challenges. And don't worry, there aren't 20. No, but the first historically high equity valuations. Okay. So when I first read the title of this seven Great Challenges to Retirement Plans, I thought that it was talking about just retirement plans from a company perspective, large entity. But no, they're talking about individual retirement plans. So when they talk about historically high valuations, they talk about how the annualized rate of return from 1926 through 2023 for the S and P 500 was 10.2%. And they go through this calculation of determining the real rate of return, which is subtracting what inflation was getting you to a real return of 7.2%. Then it goes into all this detail about how now we're dealing with extremely high valuations on stocks. And I'm going to summarize it for you because there's a lot I was. Just going to say, there's a lot of stuff here. So he's actually doing a really good job keeping it brief for you guys. What they're saying here is that the expected nominal return to stocks is just 5.5%, about half of the historical level. So they're saying that you anticipate lower rate of return moving forward. That's the takeaway from all that's? The takeaway is that stock returns over the you know, they didn't give us a time frame, but they just gave all this data to say, over the coming future, we're going to forecast this. They use the Schiller cyclically adjusted price to earnings ratio, and they talk about how we're expected to get 5.5% on stocks moving forward. So okay, keep that in mind. Great summary. Just have to say that. And the second great challenge, historically low bond yields.

Okay, so this is where I'm starting to have issues with this article. This is number two. Number two. Number one. Okay, I understand use great data, some good ratios, and I think there's probably some truth to that. But now, historically low bond yields. And they talk about how right now, the five year treasury, they talk about that yield. And basically, I'm going to summarize it for everybody as it says here, the best estimate they have of estimating future bond returns is from the yield curve. So when they look at the future of bond returns, the expected rate of return is just 4.8% for a 60% stock 40% bond portfolio consisting of the S and P 500 and the five year treasury bond, which is a lot lower than what we've gotten over the past number of years in that balanced portfolio. So they're talking about a much lower rate of return. We've talked about the 60 40 portfolio possibly running into challenges. However, with where the treasury is today, you can get a money market in the 5% range. It makes it kind of hard to think that rates are going to just fall off a cliff and go, they're. Going to be that low. Yeah. So it's the only place where not only that, but who has a 60 40 portfolio of the SP and the five year treasury. Very rarely have I seen uncommon I. Would see the investment grade bond market was it the Barclays Aggregate Bond Index? Something along those lines, but not the five year treasury. It's very specific. It is very specific. It's interesting that they use that as. Their yeah, so you got high valuations, low bond yields. So we're getting bearish here, which hey, it's okay. Okay, the next one increasing longevity. So this is a challenge because we've talked about longevity and advancements in medicine. And some of the statistics here I like is that a healthy male at age 65 has a 50% chance of living beyond the age of 83, and a healthy female has a 50% chance of living past the age of 86. And the probability of a 65 year old man living to 97 is 23%, and the probability of a 65 year old woman living to age 97 is actually 30%. That seems so high. I think that is high.

Extremely high. And this is just more to the point of your portfolio has to last longer. To me, that is a challenge. To retirement plans. Yes, stocks, bond rates of return, I get that those can impact retirement plans at some point. But over a long period of time, a diversified portfolio and not just US. Stocks and US. Bonds, but internationally, I feel like there's going to be rates of turn to be had out there somewhere. Might not be the 10% that people might be used to, but hopefully a.

Little bit more than hopefully more than the five that they're expecting. The next one, lower growth in corporate profits. And they'd mentioned this article. His name is Michael Smolansky. He's an economist at the Fed. He wrote a white paper titled End of an Era the Coming Long Run Showdown in Corporate Profit Growth and Stock Returns. And he explained how the interest rate and corporate tax trends for the last 30 years have been a really big, strong headwind for corporate profits. And as a result, stocks perform better than they would have otherwise. So they were warning against significantly lower profit growth and stock returns in the future. I guess saying the exact same thing. As number one and kind of keeping.

With a theme, which once again, it's coming from the Fed. How often have the Fed gotten things right? And so to me, that would be just another thing to keep in mind. But as we're working with clients and planning their retirement and if I was in my 50s or 60s thinking about retirement, I'm not thinking about the challenges of valuations, of stocks and low yields and bonds and corporate profits. I mean, most people are thinking about the 20 mistakes that went through. And so I was kind of thrown off by the challenges listed here. But that one does seem a little out of place. But we're going to see it through. We're going to go through the rest of them. The next one is lower GDP growth due to rising debt. I mean, if you're retiring, are you thinking about GDP growth? Probably not. And so this is talking about we're at the largest deficit as a percentage of GDP the US. Has ever experienced. And in the article, economists note several reasons why this is bad. We know why high debt is bad, but from a public perspective. They talk about how high public debt can negatively affect capital, stock accumulation, economic growth because of higher long term interest rates, higher distortionary tax rates and inflation. And they go on to talk about large increases in the debt to GDP ratio could lead to not only much higher tax rates, but also intergenerational inequality. And I'm going to sum it up. They just talk about higher interest rates and possibly higher tax rates as a result of higher debt. Okay, I get all that. Here's my issue. I was going to say, wait for it. If you're retired, how much do you really worry about interest rates? How much do you really worry about the unemployment rate? How much are you really worried about GDP and the national debt? Probably not that much. Because I'm going to assume if you're that healthy 65 year old person who's. Going to live well into their 90s exactly. Who's got a 23% chance of living until they're 97 years old. So 65 today. So we're talking about 32 years. I'm just going to assume if I was going to place a wager somewhere, I'm going to assume that we're not. We're a betting man. You mean I don't think we're going to be out of debt on a national level even in those 32 years. Yeah, I think a lot would have to change. That's a pretty safe bet. So we've talked about the national debt being an issue for decades now, and they just keep printing it. They just keep borrowing. They just keep handing out money. I mean, I just saw that everybody who is affected by the tragedy in Hawaii, that fire, is getting $700 just because here's $700. Now, I'm not saying that's a bad or a good thing, but I'm just saying it's a fact. We're just here pointing out facts, and. It'S coming from somewhere. So I just don't think that if I were to list challenges for retirement, the lower GDP growth and rising debt is not what I'd be fearful of at this point, but probably digress. Okay. The next one. The risks of long term care. Now, this one is a good one. This one is a good one is if you click on the article and you read this is half a paragraph. I think they had two sentences on this, and it basically summarizes, the longer we live, the greater the risk that we need expensive medical care. That was wow. The summary of that entire section. They went into lengths about GDP growth and rising debt and the issues with stock valuations. But when something actually is possibly going to come out of your pocket on. The list, something that's very pertinent to. It, you get one sentence, two sentences. So that is something that if you're in your 40s or fifty s and you have any sort of issues in your family, Alzheimer's or anything that can impact your longevity. Yes, you want to start looking at long term care insurance earlier than later because it's going to be cheaper. You're going to be able to be qualified probably a little easier than you would if you're in your 50s or 60s. Stuff to think about when you're healthy. Exactly. So that you're not behind the clock on that. Here we go. The last one. Failure to fully fund Social Security, Medicare or Medicaid. Oh, boy, it's going bankrupt. This is another one of those. This is I mean, how many times we talked about this? A lot. And here's what they say. Obviously we've talked about before. You might have seen the headlines. Trust Fund is projected to be able to pay benefits fully until 2033. So ten years from now, ten years, at that time, the reserves will become depleted and the continuing program income will be sufficient to pay 77% of scheduled benefits. Bleak. So you might get a pay cut by 23% if nothing changes. And then on the Medicare side, so the Hospital Insurance Trust Fund, which funds Part A of Medicare, is projected to be able to pay full benefits until 2031. So only eight years. At that point, it's going to be depleted, and continuing program income will be sufficient to pay only 89% of scheduled benefits. So scary stuff. You shouldn't retire if this is going. To that's what you're counting on. Well, no, I just think this is so scary. This is my problem. I have a very big problem with this article because it's all noticed. He has a problem with at least every other point. And then overall, this one, this article. To me, it's just based on fear. I mean, let's just summarize them are let's be honest. Stocks are not going to perform. Bonds are not going to perform. A stock bond portfolio is not going to perform. You're going to live a lot longer. But you're going to be a good thing, though. But you're going to be poor because there's no returns to be had, and. Your health care is going to be more expensive. Health care is going to be more expensive. You're not going to have Social Security or Medicare. It's going away. Oh, and lastly, because of all this, we're going to be in such a state of depression because of low GDP growth and rising just in corporate profits. Nobody's going to be able to work because corporate profits I'm surprised they didn't talk about how AI is going to take jobs away from people. And this is an article based on fear. These, to me, aren't yes, they're something you want to consider if you're building out your retirement plan. Think about it. Stuff to think about. It's absolutely important to think about it. But the problem is that people don't just think about it. They look at something like this, they say, oh my gosh, Social Security. They believe it. Yeah. Social Security. It's not going to be there. For me, I'm planning on it to be there. I'm planning on Medicare to be there. It's not going to be there because of stuff like this. I don't know what politician is going to make the largest voting base mad by impacting their benefits. And so to me, that's just something where I feel like, don't worry about that when you're planning retirement. Maybe take articles like this with a grain of salt. Yes, that's a better way to say. It, because let's end on a little bit more of a positive with it. Exactly. You can read the article, but I do think that there are things you want to consider. I do think equity valuations are high right now on yields. I wouldn't say they're necessarily low. But I do see how that could be concern. There. Longevity. Yes, we know it's concerned corporate profits. Same thing as stocks in my mind. GDP growth and rising debt if you're retired. I don't think a 75 year old retiree right now is really worried about what the 30 year mortgage rate is doing. Probably not. So that's just my opinion. We're here to help if you have questions. To help avoid some of these earthquakes. Exactly. So use the link in the description below. Make sure that you follow along. Subscribe to the channel and subscribe to our weekly retirement newsletter. Absolutely. With that. I'm Johnathan Rankin. And I'm Melissa Rankin. Thank you so much for joining us.

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