Get More Bang Out Of Your Retirement Accounts with Tess Waresmith

Foreign this is the no Closer show where you get the latest developments in distressed note investing and learn the secrets of how you can control millions of dollars worth of property for panties on the dollar. Get educated and entertained by someone who has closed thousands of deals and lives to support you in achieving the same. Now here's your host CEO of We Close Nodes, Scott Carson. All right, everybody. Hey. Welcome to Note Night in America. We're glad to have each and everybody join us here live on Zoom. Catch us live on the streaming and then those that are coming catch this on the Replay on Tuesday or those that are listening on the Note Night in America podcast or wherever. But you can listen to wherever you download your podcast. We're honored to have you join us here tonight. We have got a very special guest tonight, somebody that I met at fincon and just absolutely thought would be a great resource for each and everybody on here. Now we've got a variety of folks I know we have folks that are full time investors on the call here. We've got people that are dabbling part time as a hobby. They're also working full time and have a job. You know, they've got your, you've got your 401k, you've got your other things that are going on. And I know that with the way the world is, how crazy the recession we're in, people really trying to squeeze more out of your month or more out of your dollar than you know then the month that you have at the end of your paychecks. I wanted to bring somebody on tonight, kind of help you guide, guide you along those way, help make some very educated decisions in helping you get more money out of retirement accounts and things like that. So really, really honored tonight to have a very special guest. This lady has been helping other people out there make wise investment decisions for a while now. She is a rock star in the world, I'll tell you that right now. This is somebody you need to keep an eye out for because she's doing amazing things out there. Like I said, I met her at fincon. We hit it off immediately. She's just an expert. She is the host of the class called Investing with Tess. She likes to make investing simple and not complicated like Wall street likes to make it. So we're honored to have join us here on Note night in America, Ms. Tess Wearsmith. Hey Tess, you can turn on your camera if you can tonight and we can see your smiling face there and get rock and rolling. So how are you doing tonight, Tess?

I'm good. How Are you.

I'm doing great. Happy New Year to you.

Happy New Year to you. Thank you so much for having me. That was such a kind introduction. I feel so good about myself, so thank you.

Well, I'm available before you speak or at weddings, bar mitzvahs if you need an introduction. I'm glad to do that there for you. And you mentioned that you're in an area. It's getting a little bit of weather right now. Where's home for you right now? Where you at tonight?

I'm in central Massachusetts in an area called Worcester. Or if you're from Boston, it's Worcester. And Worcester is a little bit in the hills. So we're getting some pretty serious snow. So we'll see what happens.

Well, stay. Stay warm and cold or stay warm and let's hope the power stays on for you tonight. But tell us a little bit, tell about how you got into what you're doing before. I know you've got some slides and presentation. I go through with folks there, but kind of talk about your little bit of your background and how you got to where you're at, doing the magic that you're doing now.

Yeah, 100%. So I've been investing for about 12 years. I started actually in real estate investing, which is backwards. I think most people get into it in the other way. They start with their 401k and then gradually go from there. Work with somebody like you. But I actually did the opposite. I started with real estate investing. I made a ton of mistakes, but that was probably the smartest decision I ever made. Even though I made mistakes, they were recoverable. And now I own a few properties that are cash flowing. And that's been a great investment for me. While I was doing that, I hired a cpa, a certified financial, sorry, cfa, certified financial planner, somebody that was a fiduciary to manage my money for me. And I had actually been lucky enough to get. I graduated into a recession, lucky enough to get a crazy job working on cruise ships where I was able to park a lot of money. And so I wanted to.

Okay, I didn't know that there's another whole day, another whole story of working in cruise ships. I want to hear about that later.

Yeah, my first job was aerial acrobat and cruise ships, like Cirque du Soleil type stuff.

Wow, that's cool.

Yeah. Yeah. So it was a great job because I had no expenses. Beers in the crowbar were a dollar. And I saved a lot of money over a couple of years. And so I Invested in real estate. And then I also thought, I want to make sure I'm investing in the stock market and making my money work for me. So I'm going to hire somebody that knows what they're doing because I don't want to mess it up. So I hired somebody that was a fiduciary, somebody Great White thought was great, and then after a period of time started to look more into what they were investing in, what kinds of retirement accounts I had. And long story short, this person didn't set me up for success. And, you know, I don't think that they. And it wasn't intentional. The industry's not just not really set up to compensate financial advisors in such a way that it's in their best interest. Interest to work for other people. So work in the best interest of other people. They make more money by selling products and selecting investments that are specific types of investments, not necessarily what's in your best interest.

So, yeah, I heard a great analogy that Wall street is a for profit business. In the case of for profit, somebody makes money and somebody's got to pay that.

Yes, 100%. And so every, if you're working with a fiduciary, you know, the, the guidelines around that are very broad. You know, they're what's in your best interest. Like I could, I could make the argument that anything is in your best interest. Like any investment theoretically could, could be in your investment because it has the intention of growing over time. So that was unfortunately a mistake where I lost a lot of money. She also put me in an annuity, which there are some annuities. And when I say some, I mean probably a very, very, very small percentage and a very, very, very small percentage of the population that is a good fit for something like this. And I was 25 years old and it was a terrible investment, but they made it sound really fancy and smart. And I had already been maxing out my retirement accounts, and so now I don't. I like, shudder to think about how much money that would have been if it hadn't been in the annuity. And I can't get out of it. It's like lock and key. There's no surrender. Surrender charge is a fee you pay to get your money out. I can't even do that. And I've shown this to other financial experts and they've looked at it and basically said, this is criminal. This shouldn't be a thing that people are sold. And that's just one of probably hundreds of types of investments. I'VE seen now that are not good for anybody and no one should be investing in. But you don't know what you don't know. So that's why I started doing what I do is because I don't want anybody else to make those mistakes. And then also that after all this, I realized it's so simple. So now I'm trying to help people do it the simple way.

Well, the beautiful thing that I love is that it's not. You're also a real estate investor and you've gone that route and done that. That's the. One of the great things is understanding the relationship between the two. And, you know, we get a lot of people to come on, oh, I'm a financial advisor. Well, how much real estate do. I don't own anything. Well, you're not going to fit into my audience and those out there because, like I said, begin with. Our audience is mixed. Of those that are still working 9 to 5, they're investing or getting ready to think about retire, want to get investing, doing some things about it. So really glad to have you on with that knowledge and that mix. Really kind of the foot on both sides of the fence, you know what I mean?

Yeah, yeah, absolutely. And I think, you know, it's interesting that in this industry, in investing in general, there is so much polarization, like you're a real estate person, or you're a stock market person, or you're an index fund person, or you're a dividend person. And the fact of the matter is, the more you can learn about all these different ways to hack wealth, whether it's by using retirement accounts strategically, investing in real estate, Airbnb, single family duplex, whatever it is. Like, there's a million different ways to make your money work for you without trading your time. And I think that retirement accounts is one thing that I've seen real estate investors overlook because they're so excited about real estate. And that's great. It's. I mean, quite honestly, in a lot of ways, you could argue it's a better investment than traditional retirement accounts and stock market investing, but there's so much benefit to having both. And that's what I'm excited to have, help more folks understand.

Awesome. Well, I'll let you take it away. You want me to lurk in here and field questions for you or jump in as things pop up, or you want to wait till questions till the end?

No, I'm happy to make it more conversational. So I'd love to. I'd love to Hear from anybody that is here. If you have retirement accounts right now, if there's a. Is there a chat? Yeah, there's.

Yeah, there's. Oh, actually it would help if I enabled the chat. Yeah, hang on, let me go and enable the chat for everyone can talk with everyone there for it. And then I'm also monitoring the YouTube channel. So, yeah, we got a couple folks on here. So I've got a 401k. Got an IRA. Okay, 401k. I've got a solo 401k.

Oh, cool.

Got a couple with Ross commenting. Anybody commenting on the Zoom? Not yet, but those are coming from.

Our online 401k and Roth.

Yep, there we go. Yeah, we've got a pretty. We've got a pretty savvy bunch of people doing some thrift savings plan. Peter, he work. He's a male carrier down in Viva la Miami down the neck of the woods.

So, yeah, awesome. Cool.

School teachers in here as well, too. I see.

So some 403B is cool. All right, awesome. Well, I will dive in. And just so you all know, what I wanted to do is just pull out some of the best, best of the best stuff that I usually share in my paid program or with folks on my webinar. So I'm gonna jump around a little bit, and if you have a question, feel free to ask it. Scott, if you see somebody with a question, I'm happy to pivot based on what y' all need and make sure this is valuable for you. So let me share my screen and we'll dive right in.

Awesome.

All right, perfect. So one thing that I'm going to say right off the bat is a lot of times when I share what the way I like to teach this kind of stuff, a lot of folks feel like it's too simple and they want the more complicate. They want to do more advanced investing. And while there's a lot of benefits to that, there is also something to be said for how effective simple investing can really be. So I'm going to talk about some really simple ways to make sure you're checking the boxes. And if you're somebody that's investing in real estate already, that's an amazing opportunity to grow your wealth. But having some of your money in traditional retirement accounts and using those retirement accounts thoughtfully and strategically is super valuable to make sure you're growing your wealth in a variety of ways.

This is also good too, because a lot of our students are talking with people that have money in an IRA account or trading account and help them move it into a self directed account to do some investing. So it's good kind of talking with people to help them understand when they're having this financial education. That's awesome.

So awesome. Cool. So for this, I want to know if this sounds familiar to every anyone, you can drop it in the chat, but are you not sure if you have the right retirement accounts? You know, you should be investing in more retirement accounts, but you're not sure which ones. Um, you have an old 401k, you maybe have a Roth IRA, but you're not sure if you're doing it right. Maybe you have an old 401k and you're not sure where what you should be doing it with it. We're going to talk about that. And you don't want to spend hours managing your money. So if any of this applies to you, this is some of the stuff we're going to talk, we're going to be talking about tonight. And just so you all know why I'm so passionate about this. You know, Scott and I talked about why I do the work I do now, which is really because I made so many mistakes when I was investing and using retirement accounts. And truly I did real estate investing much better than I did regular retirement account investing through the stock market. And it's actually so much easier if you think about it in a very simple way. So that's what we're going to do today. But for me, the reason I wanted financial independence is because I wanted money to buy. Freedom, flexibility, options, those kinds of things. Right? I wasn't interested in money so I could go home and count my dollar bills and drive a Ferrari. Although if someone gave me a Ferrari, that would be fine. But this is why it's important to me and also another reason why I love stock market investing too and using retirement accounts is because there's so many ways to build wealth through those accounts and then use it to invest in real estate. And that's what I've done several times now. So we talked about self, we mentioned self directed IRAs and we can talk about that in a little bit. So retirement accounts can really help us reach financial independence and for all of you, really help you diversify. So this is really important stuff that a lot of people end up skipping over. And retirement accounts can feel really intimidating by the way. So if you're somebody sitting there thinking, yeah, I have a 401K and Roth IRA and this and that, but I don't really know what that means, a lot of People don't know what IRA stands for, even though they've been investing in one for a long time. IRA stands for, by the way, individual Retirement Account. But a lot of people feel really intimidated about retirement accounts. But once you understand the basics, they're quite simple. But it's reasonable to be overwhelmed in the beginning. So I like to include this slide. Here's a list of things that you don't need to be a good investor. And I would say this is included for real estate as well. You don't need to be debt free. You don't need to be rich. You don't need a financial advisor or partner to do it for you. You don't even need to be good at math. You don't need to be good at picking stocks. That's a big one. There is some benefit to selecting individual stocks for a very, very, very, very small percentage of people that want to spend a lot of time doing that. So if you're looking for passive income. Not my recommended direction, Scott, I don't know how you feel about that, but.

Yeah, I've had many conversations with folks about that. And it's like some of them said, you might be luckier just to throw a dart at us, a board. You know what I mean? Some cases, because you never know what's going on once you've got a lot of insider information, a lot of times it's hard to pick stocks that are going to hit in a lot of cases. Yeah.

Yeah. I mean, even of all stocks of all time, there's only been 4% that have grown over the long term. And if you think you're lucky enough to pick the 4%, you have to also remember that they've. I think they even did a study with monkeys throwing darts at stocks.

Isn't that they did think they did.

And the monkeys won? Yeah. So it's not a good strategy. Individual stock picking is not a great strategy. So all you really need is an open mind, education, and to take action, which is what you are all doing here. So if some of this doesn't sound familiar to you, give yourself some grace and then make sure you take some action because there's going to be some really simple takeaways that you can implement pretty quickly for some of you.

Peter says it's all Chinese to me.

Peter, I got you. No worries. So Thrift Savings Plan, by the way, is similar in many ways to a 401 case. I don't talk about that specifically, but these things are still going to apply for you, Peter. All right. So here's what we're going to chat about. Two foundational things you need to fast track your wealth. Three keys to making money in the stock market that are way simpler than you think. And then what we're going to spend the most time on is how to save big on taxes, which is retirement accounts. So we already talked about my money story a little bit in the beginning. And this is actually a picture of me on the cruise ship doing acrobatics, this crazy first job. That's what happens in a recession. You end up doing weird jobs. But it was great because I was able to save a lot of money and start investing in real estate and the stock market. I'm a VP for a global company, so I am not interested in making money in one way. I still work full time. I have a business. I have real estate. I invest in the stock market. And I really believe you don't have to do all of those things. But having multiple streams of income is so important. In a retirement account is another way to do that. I also own a online investing course about very basic investing in index funds and retirement accounts. I'm not going to talk about this now, but if you're interested, you can always ask me later. And one thing I want to share, too. For anyone that feels like it's all Chinese, like Peter. And thank you for saying that because I think a lot of people think they all should know this. This is Colleen, somebody that took my investing program and she didn't know anything. She didn't know where her old 401k was. She had no idea how to invest for her, and she left thousands on the table. I don't tell her how much she was paying in fees because it was a lot and it was very sad. But she, in five weeks was able to clean up all her retirement accounts and invest in lower fee funds and save probably roughly three to $5,000 a year in like 20 minutes of changes. Just because she learned the basics. Yeah. So this is something that, you know, if you think it has to be complicated, it does it. And I share this story just because she knew nothing and very quickly sorted it out. The bottom line is managing your own investments, if you have a financial advisor or not, is easier than you think. And for a lot of people, you don't necessarily need one. If you want one, there's benefits to that. But most people, you're paying a lot of fees for something that you really don't need once you learn the basics. All right, so before you invest, before we get into retirement accounts, though I have to put out the disclaimer about spending. And I'm sure this is something that Scott has talked about or any other financial people in finance and investors. None of this matters unless you manage your cash flow first. So you can have all the right retirement accounts, you can have all the right real estate. But I mean, Scott, you know, right? Like you have to understand how money comes in and out of your life.

Amen to that. That's the truth. You gotta have, you gotta have more money than months.

Exactly. And so understanding, asking yourself these questions, like, why are you buying what you're buying? What are you trading your time for? Especially if you've been investing, you've been investing for a little while. Some people might not track their spending because they're like, I'm fine. I know my cash flow is good. But it's worth it to go back and figure out where you might be spending money that you don't need to or want to. That doesn't mean that I am somebody that thinks you shouldn't spend your money on things that bring you joy. By all means, do that. But something to think about before you start to get into all your retirement accounts. You want to make sure you have your bases covered. And so these are some questions to ask yourself before you purchase stuff. Will investing in this improve my life? How many hours of my life did I have to work for this? I think that's a great question. If, if you make $20 an hour and you buy something, you buy a wallet that costs 100 bucks. You just worked five hours of your life for your wallet. Is it worth it? I don't know. It depends on who you are and what you want. And the number two is invest. Even if you have debt, as long as it's low interest debt. And Scott, I don't know how often you run into this, but I've spoken to a lot of folks that are afraid to start investing because they have low interest debt, like student loans or maybe even their mortgage. They want to pay down their mortgage faster.

So horrible. Sorry. It's the. Here's the thing. If you got low interest rate debt and it's especially like 6% or less, let's just put that out there. Because a mortgage rate, 6%, if you take, instead of paying it down, if you take that extra amount each month and put it to something that can make you more than 6%, you're winning. But if you pay down your low interest rate stuff, you're losing money. Now it makes sense if you have like high interest rate credit cards because you want to pay off that debt, because that stuff is definitely need to pay down. But that low interest rate debt is like cheap money. Paying off your student loan debt, let it drag out because that's the cheapest money you're going to get. And, and it's the same thing too, like with parents. Oh, I'm going to pay for my kids education. Well, do you have retirement? No. Hell, your kids can get cheap government money. Put the money away for your retirement.

Yeah. And your kids have time. They have, I mean teach them how to invest early so they can take advantage of time in the market. But they have time. You don't always necessarily have time. So what, what Scott just said 6%. Some people go by the 7% rule. I actually like the 6% rule right now because things are a little bit wonky and I think it's good to be conservative. But anything under 6% is really something that you shouldn't be trying to pay off quicker because mathematically you're, you're not using your money in the best way. The historical return of the stock market is roughly 10%. It's about 8% if you subtract for inflation. So paying more for anything like paying, trying to pay down student loans and mortgages under 6 or 7% faster doesn't make mathematical sense. Now a lot of people will say yeah, but like I just like don't want to have debt. If that's the case, then we need to talk. Please ping me because. Because it's definitely not the best use of your money long term and you can really miss out on a huge opportun opportunity. And I did this math with somebody in my money confident program and she was paying off her house quicker. And we did the math. If she kept paying what she was paying for the next, I think it was like 11 years. She would end up with, you know, saving $20,000 on interest payments. If she invested that money and she received a 7% return on the stock market, she would end up with somewhere in the neighborhood of $90,000. Like huge, huge difference in, in savings versus investing or trying to pay down stuff early. Cool. So those are the two things that I just always like to start off with. You have to manage your cash flow and you have to start investing. Even if you have some debt, it's just not worth it to wait. You're really missing out on an opportunity and you don't need a lot of money to start investing as long as you have an emergency Fund, and you've gotten rid of that high interest debt, you're good to go. So I'd love to see in the chat, what is this group's comfort level with volatility in the market? 0 being I terrified. 10 being I'm as cool as a cucumber. If you want to drop it in the chat. Where is everybody at?

We got a seven. We got an eight. We got a nine. Another nine. Peter's three. He's terrified. One, two, seven from John. Yeah.

Okay.

There we go.

All right. We're all twos and sevens. Nobody's in the middle.

Everyone's seven from Audrey. Yeah, it's, it's, it's on, it's, it's on both sides of the scale, for sure.

Perfect. All right. Well, my goal is to get most people to a six or above. And as I go into the investing portion, I just want to make 100% sure that everyone here understands what I'm saying. So I always like to start with some definitions of words that I'm going to use later. So, first of all, the s and P500 is a group of the 500 largest US companies. So if you hear. When it sounds like Chinese to you, if you hear on the news or you read in a newsletter in your inbox and it says the s and P500 has gone up 2% or the S&P has gone down 3%, what that actually means is that the group of the 500 largest US companies by market cap, as a group has increased in value or decreased in value. And the reason this is important is because this group is used to track the performance of the overall stock market. So when people say that, they're just saying, generally speaking, the market is doing this or it's doing that. That's all the S P500 is. So if you've heard that, you didn't know what that means. That's what it means. Stock market return is the profit you receive. Y' all know that. And then there's two other things, a bear market and a bull market. Bear market was when the stock market experiences prolonged declines in value of around 20%. This happened last year. Now, here's something really important to understand. The average length historically of a bear market is 10 months. That feels super long when we're in it. But 10 months is not that long in your investment horizon. And they also occur roughly every three to four years, which is pretty frequently. Like, we should be expecting the market to decline by 20% every couple of years on a regular basis. And so understanding these historical numbers will help you feel more comfortable with the market when you start investing. So for my twos and my threes and anybody under a 5, really important to understand this information that the stock market cyclical, this is going to happen. We should expect it to. We should expect at least three to five recessionary events in our investing timeline. Right. We're probably very likely going to be in one this year. We were in one in 2008, and it'll happen again. For those of you that are in your 20s, 30s, and 40s, and probably even your 50s, you're likely to experience another recession after this one. So it's good to just understand that for expectation purposes. And then a bull market, which we like much better, is when the ST market experiences ongoing increases of 20%. The average length of a bull market is 2.7 years. So we like that. Right. Bear markets, they occur less frequently and they are shorter than. Than. Sorry. Bear markets occur less frequently and they are shorter than bull markets. And the way that you can remember this, by the way, I thought this was really funny when somebody told me this. A bear, when they fight or try to murder you, will like swipe down. A bull, when it tries to murder, you will swipe up. Hopefully no one here gets murdered by a bear or a bull. But this is, this is how you can remember these two terms. So bear is coming down, a bull is going up. So the key takeaway is bear markets are going to happen. All right, so now that we've gone through that, let's go to three keys to making money in the stock market. I'm going to go through the first two really quickly and then we're going to get to retirement accounts. So the first one, invest consistently over time. For those of you that are a little bit nervous about investing and you want to save to retirement, this is why you don't want to do that. If you Invest, assuming an 8% return, $500 for 30 years, it's $680,000. If you save that same amount of money, it's $180,000. So that's a half a million dollar difference with the same amount of money you contributed. Now, real estate has all kinds of different returns, which is amazing. This is just a flat 8% return on the market, which is why it's so great to understand that both of these markets are going to go up and down and it's so valuable to invest in both. But it's really important to know that saving your money is, is not a Great option. And if you wanted to be a millionaire and you didn't have any real estate and you just invested $725 a month for 30 years, you would have roughly a million dollars saving. The same amount would be $280,000. Not a great strategy.

Yeah. As they say, Jesus saves. Everybody else has to invest.

Yeah, exactly, exactly. And a lot of people don't know this, but for my younger folks, if you are here, if you were able to invest a hundred thousand dollars by the time you're in your 30s and never invested another dime, historically speaking, now this is not guaranteed, but historically speaking, based on an 8% return, you'd have a million in retirement. So that's the power of time in the market. And all of this is meant to remind all of you that we know that the stock market is going to go up and down, but over time it's increased. Historically, it's been positive of around 10%, 8% when you subtract for inflation. Let's not subtract, subtract for inflation. Last year was super sad. But ideally inflation should only be around 2% on average moving forward. So we'll see what happens this year. But small, consistent investing of any amount can grow your wealth. So if you are somebody that's investing in real estate and is doing this on the side, it's a great way to just again, diversify, make sure you're taking care of yourself and you have something really consistent and simple. And then you can always have your other real estate investing going on. So some people just put everything in real estate. I always say, look, if you have a couple hundred dollars that you can contribute to a retirement account as well, that's a great use of your money and a great way to diversify. So point number one, not investing is risky. And then key number two of making money in the stock market is don't try to time the market. We've talked about the average return of the stock market being about 10%, but it's not linear over the last year. Last year was super, super sad face. If you started investing last year, you had a crappy time. But if you invested started five years ago, your return as of right about now was still up 50% or 45% probably right now. So if you started investing in 20, 18, 17, you're doing pretty well. And if you started 30 years ago, this is the overall return over time. So when people get nervous, for my twos and my threes and fours that are really nervous about stock market investing, remember 2008. When the world collapsed, we were on the brink of financial collapse. Lehman Brothers went out of business. Banks were going bankrupt. The government's bailing them out. It was just like apocalyptic Financial Times. 2008 barely looks like a blip on this radar. If you are investing over time from 2000 until now, you've done really well in the market, even though you've experienced a pretty serious recession of about 50%. So for my twos and threes, it's important to remember that this is going to happen. We have to expect it to happen. The key is to invest consistently over time. And one more for my people that are nervous. So yes, the S and P was down about 20% last year. It's still up 50% over the last five years. But if you invest over time. So if you started investing now, any given day, the likelihood of the stock market going down or up down is roughly 46%. But over a 20 year time horizon, it's less than 1% likely that you would have less money than you started with, less than 1%. So people say the stock market is like gambling. I would say it's a extremely calculated risk. And given all the data that we have, if you invest over the long term and don't try to time the stock market, you should be fine. Now just to further the case for buying and holding consistently, JP Morgan did a study and this is one of my favorite stats. If you missed the top 10 days in the market from 1999 to 2018, your overall return was cut in half just by missing 10 good days. No one in the history of the stock market, not Warren Buffett, not John Vogel, not any of these legends can tell you what 10 days those are gonna be. Which is why it just makes sense to keep investing and active. Traders underperform the market significantly over time. Six and a half percent. I actually think it's higher than that. All right, so keys one and two are really simple. It's invest consistently and invest over a long period of time to take advantage of compound interest. Super easy. Right now. Number three is saving on taxes and fees. We can do this is retirement accounts. So we already did this. You guys already dropped your retirement accounts in the chat. But taxes are biggest expensive. Your real estate investor. If you're a small business owner, you know that there are tons of amazing ways to save on taxes. Retirement accounts are just another way. So for those of you that have a 401k, I'm going to start with 401ks and then I'm going to Shift into some other types of IRAs or individual retirement accounts. But the 401k is one of those investment in retirement tools that I think gets a really bad rap. And it's actually an incredibly valuable tool for so many people. And it can really help you build a life you want and deserve. But you have to learn the basics. Because if you don't know there are tons of FEES in most 401ks and 2/3 of Americans have no idea what they're paying for fees in their 401ks. If you know, drop in the chat, I will tell you. Most times when I ask people to drop this in the chat, nobody knows what fees they're paying in their 401k. And that's okay if you don't know. By the way, I would say probably this is. Two thirds of American have no idea what fees they're paying. I think it's far more than that. I think 90% of people don't know what fees they're paying. And that's okay.

You're so right about this though, because as the next financial advisor, years ago we were. And then even looking when I had a full staff here, I was looking at 401ks and looking at the fee structures and it's just ridiculous in a lot of cases, just stupid. The different fee structures on some of these things and how they're packaged.

Oh, it's. It's so hard to find. It's so hard to find. And there's a lot of times you have to actually email the provider because they're so hard to find.

Yep.

But here's why you need to know is because the average amount that Americans will pay over their lifetime is $138,000 in fees. That's not just one study. There's multiple studies that show this. So if you're somebody that's living off 70k a year, this is multiple years of your life that you're paying in fees. If this surprises you, drop yes in the chat. It surprised me the first time I hear it. I was shocked. And for some people, it's much more than that. Additionally, the leaving behind a 401k account has a potential to cost an individual almost 700,000. And there are actually billions of dollars of left 401ks that no one ever goes for that they just leave them. And a lot of times it's people. That woman that you all saw a few slides back, I showed you some. One of my clients that had taken my beginner investing program and she didn't know where for 1k was, she had $70,000 of student loan debt and she thought her old 401k was just like hanging out with maybe like 5 or 10,000. She had no idea how much was in there. She had $80,000 in her 401k and she hadn't looked at it in six years. So this happens all the time.

Thing right now with so many people getting laid off from jobs and, and transitioning and many people are dealing with that where they've got 401k, they don't know what to do with it. They don't know how to roll it into something new, their existing 401k or put it into something like a self directed Roth that they could do something with. But yeah, you're so much. What's sad, I was talking to a financial advisor the other day. He's like, you know it's actually illegal for us to market for rollovers anymore.

That's crazy.

I'm like, what? He goes, yeah, I can't. It's like ambling. They, they'll slap us on the wrist like it's an ambulance chaser. I'm like stupid anyway.

Yeah, that's so. Well, for those of you that have an old 401k, we'll get into exactly what, what some options you can do with that. But yeah, that's a bummer because your 401k has fees. So for those of you that don't know, just real quick, 401k is an employer sponsored retirement plan. It's similar to a 403 or a TSP or 457. Your employer automatically takes some money out of your check and puts it into an account. Now for those of you that don't know, this annual limit has just increased. By the way, it was 20,500 in 2020, 2023. It's now 22,500, which is great news for those of you that have 401ks and are contributing. So it's great for a lot of reasons. Number one, if you have an employee match, this is so important, take the match. About 30%, 25 to 30% of people don't take the match. And the match is free money. So that means that your employer is going to give you money for contributing to your future in your retirement account. So tell your friends. I know in a company I used to work for, I was good friends with the CFO and I asked him how approximately how many people are not contributing, not taking the match. And it was over 30% which is crazy. Yeah. So take the match. If you don't know what a match is, I will help you DM me later. So. And the taxes on traditional 401ks are deferred, meaning you don't have to pay them until retirement. But there are a couple other options to consider. So to make the Most of your 401k, the first one, super easy, take the match. The second one is consider a Roth 401k option if you have it available. And the third one is to roll over your 401ks and reduce your fees. So if you have a Roth 401K, a Roth 401K option is becoming more and more popular with lots of organizations, which is great because there's a huge benefit to a Roth 401K. So a regular, traditional 401K, you contribute money, it reduces your taxes now, but then in retirement you have to taxes on that money, whatever it's grown to, whatever you take out, you have to pay taxes on it. With a Roth 401k, you aren't paying taxes now, but in retirement, sorry, you are. You aren't getting a tax break now, but in retirement you don't have to pay taxes on withdrawals and all the growth of that money. So if you put in money and it's growing in the stock market for 30 years, you don't have to pay taxes on that either. So for a lot of people, a Roth IRA 401K is going to be a great option if you have it. And if you're not sure whether you should do a Roth, a traditional or a Roth 401K, I always say that it's a great option to do both because you're getting tax advantages on both sides. But this is a really good option. The other thing I will say is if you're a 4, if you're somebody that has a 401k and you don't know if you have a Roth or you don't think you do, check, because I've worked with many people that their company didn't tell them that they have this option in their 401k. So your company doesn't benefit from providing you with a 401k education. So they are not going to go you out of your way to let you know that your 401k provider now provides you with a Roth 401k option. So make sure you ask about that. But this is a great option for people that want to get taxes out of the way and make sure you have that money tax Free in retirement.

Do you find to test that? A lot of folks, a lot of companies, it's like the information for the 401k and they're not obviously an investment specialist of any sort. That's why it's always good to pick up the phone and call a hundred percent.

It's the same with anything around, like rollovers too. Like if you have an old 401k and and you can't find it, like your HR is like not the best person to ask about it. In. In general, sometimes organizations will have their 401k provider do a presentation, but that presentation is usually a sales presentation to ask you to go with their advisor. They. They're not going to educate. It's not in their best interest to educate you because then you're not going to need advisory support that they can charge for. So yeah, I think in general, you know, HR folks do a great job, but they aren't trained in this kind of stuff.

Yep.

All right, so one thing I'll stop and just make sure everyone understands is that traditional 401K versus Roth 401K, it's super simple. You're either paying taxes now and you're getting them out of the way or you're getting to reduce your taxable income now and then it grows tax deferred and you pay taxes on your withdrawals in retirement. It's important to note that as of this year with if you Choose a Roth 401K, your employer is still going to contribute to a traditional 401k. So if you choose to contribute to a Roth, you're going to have both and different tax treatments on both. However, The Secure Act 2.0 just came out and so in the future, employers are going to be allowed to contribute their portion to a Roth 401k as well. So this could change in the future. But right now, if you have one and you're contributing to a Roth, your employer's contributions are in a traditional 401k.

Nice. I did not know that.

Yeah, there's a lot of good things coming out from that act. Another thing that just came out too is that employers will be able to start contributing to student loan debt if you haven't it. So that's cool too. Yeah, some good, some actually good things coming out of the. So wealthy people will do whatever they can to get into a Roth account. And the reason for that is because they want to get rid of taxes. So if you have access To a Roth 401k later on, you can roll it over into a Roth IRA and then you are done with your taxes on that account. So if you don't qualify for a Roth IRA, a Roth 401K is a great way to get money into an account that's going to grow tax free and be tax free in retirement.

You could also take your 401k, which is kind of enroll that into a Roth IRA and then basically pay the taxes on the amount in there right now and then it's tax free the rest of its Life, correct?

Yeah, 100%. And so the reason you would want to do that, it's a great segue. The reason why if you have an old 401k and it's just sitting there, there's a few reasons why you might want to consider rolling it over to an IRA. The first one is administrative fees. So every 401k has fees. 0.5% or less are reasonable, but over time, 0.5 adds up a lot because that's not the only fee you're paying. You're also paying for fees and whatever you're invested in inside your 401k. So once you leave a company, rolling over your 401k to an IRA is a great way to reduce fees. Fees. So just so you all understand fees, if you are somebody that has a financial advisor, if you have a 401k or anybody that's managing your money, or a robo advisor, you need to look at this graph and understand these numbers. So this is an example of two people that had $50,000 invested in a 401k. And on the left, Taylor, she leaves her 401k with her former employer and the total fees of her 401k are 1.1%, which is not actually that high. The average administrative fee is about 0.5%. If you add some fees in the investment, she's in 1.1%. So she leaves that 50,000 in for 30 years. She receives an average 8% return over time and she'll end up with $627,000. That sounds like a pretty good deal because she only put in 50 and 30 years later she has over half a million. However, ryan rolled her 401k over to an IRA to reduce fees. So she got rid of the administrative fees. She invested in low fee index funds. She ends up with, 30 years later, $837,000 just because she rolled over her 401k and reduced her fees by 1%. So this is why it's really important to learn how to invest on your own, or at least understand what your financial advisor is doing. And make sure you're invested in funds that aren't super expensive, as well as you're not leaving your money in 401ks that high, have high fees, because you can end up paying thousands and thousands of dollars in fees and have no idea. So what are your options now? You're like, okay, I definitely don't want to pay those fees, so what do I do? So you have four options. The first one is to withdraw or cash it out. Do not do that and involves heavy penalties and fees. Absolutely avoid it. You can leave it where it is. Where. Which we just talked about. It's not a great option. You can move it into a new 401k, which for some people trying to do backdoor IRAs, this might be a good option. If you have no idea what backdoor Roth IRA is, don't worry about it. But if you are somebody that knows that term, you want to be careful rolling over 401ks to IRAs. And the last one is to roll it over into an ira, which is a great choice for most people. And the reason why is because you get better investment options. You get rid of that administrative fee, which is often around 0.5%, and you just have control of that account. Right. It's not somewhere in an account. And you're not reliant on HR to manage that administrator for you. You just have your own account. So all you have to do if you want to roll over your 401k is work with a reputable brokerage like Fidelity, Vanguard or Schwab. You identify which IRA you want to roll it over to. So if you have a 401k, you could roll it over to a Roth IRA, or you could roll it over to a traditional IRA. And as Scott mentioned, if you have a Roth 401k or a regular 401k, you can roll that over into a Roth IRA, which is a great way to get money, more money into the Roth. You would just have to pay taxes on that money now, which could be a significant tax obligation. But then you're done with it and you don't have to worry about it. The third option is you can use a service called Capitalize. Scott, do you know about Capitalize?

No, I hadn't heard of it.

So Capitalize is cool. They're a free service that helps you with all the paperwork rolling over your old 401ks, so they get compensated by the brokerage. So if you decide I want to roll over my old 401k into a Roth IRA. Infidelity. They'll help you with all the paperwork, they'll help you sign up for everything. They'll open your account on your behalf and they'll do it for free. I'll drop the link in the chat. They'll do it for free. The only thing that you have to do is just provide them with information and they get. Fidelity gives them a cut of money for doing that. So it's great for us. It's one of like my favorite fintech tools because it doesn't cost us anything. So if you are somebody with an old 401k and you're dreading the work, then this is something you can do. I don't know. John just asked, can this be a self directed ira? I'm not sure if they do self directed yet. I know they.

Here's the thing. Every bank, everything, every IRA is technically self directed. It's self directed in the funds that they offer. Doesn't mean you can offer it into like a self directed IRA like Quest or Equity Trust Real estate. I don't think capitalize does. I think you have to reach out to those companies individually and it's still pretty easy to roll over from a 401k into a self directed IRA company. It's just. It's just filling out some paperwork for you.

Yeah, exactly.

Yeah, yeah, yeah. Capitalize doesn't include that, I believe.

No, no, but they will include. So I think that's a good point, Scott. Like self directed for some people might mean like there's self directed where you get your own options to choose your own investments. And then there's a specific type of self directed IRA that you can use to invest in real estate. So those are slightly, two slightly different things and definitely something to look into if you want to use your old 401k money, invest in real estate. You could roll it over to a self directed IRA and that could be a great way to leverage that money to do something different. So some common mistakes to avoid if you don't do a direct rollover. Once you take out your money from your 401k, you have to deposit it into a Roth or a traditional IRA within 60 days, otherwise you'll get penalized. And then the other big thing is when people open a Roth IRA or traditional Iraq, a lot of times they don't actually select investments to go in that IRA. Those are just containers for your investments. IRAs, 401ks, TSPs, all of these things are just containers. They aren't investments in themselves. And that happens a lot unfortunately. And if you have. This actually just happened to somebody. I couldn't believe this. A financial advisor was managing a Roth, a traditional and a SEP for a client and the Roth wasn't invested. It was just sitting there in cash. This just happened like last week.

Well, you'd be surprised too. It happens. I mean a lot of people get excited about investing in real estate or notes. They open an account like Equity Trust or Quest and they roll money into there, but they never take action. 30 to 40% of every self directed IRA custodian, the money is sitting there in 0% interest accounts.

Wow.

Not making anything for them, which is just horrible.

Yeah. At that point you might as well open up a high yield savings account and get your. Right now like 3 or 4% something. Yeah, get something. Cool. And then another way to reduce fees, and this goes for all retirement accounts, is to choose investments with low expense ratios. So an expense ratio is a fee expressed as a percentage. That is what you have to pay for investing in a specific fund. So every mutual fund, target date fund, any investment that holds a group of of stocks or bonds has what's called an invest an expense ratio. So one really easy way to lower these expense ratios is to learn how to invest in index funds. Index funds are really simple. One, we can talk about that a little bit later. Now there's a few other ways to save on taxes though. So first of all, you should probably have more than one retirement account. If you have a 401k, you should also have a Roth or a traditional IRA. If you are a business owner, you can probably contribute to multiple IRAs and a solo 401k. There's a lot of options out there. So you want to make sure that for your individual situation. And I can't tell you what that is on this call, but that you're looking into all your options because especially if you're a business owner, you can save a lot of money on taxes by opening SEP IRAs or solo 401ks. If you're a solo business owner.

Yeah, we don't pay Uncle Sam as little as possible.

Yes, please, let's pay him less. So for a Roth IRA, just to make sure everybody knows a Roth IRA, it's the same exact thing as a 401k and a traditional 401k and a Roth IRA. So just for everybody when it feels really confusing, 99% of the time, you're either paying taxes now and then you don't have to pay them in retirement or you're paying taxes, or you're reducing your taxes now and you have to pay them later. Uncle Sam is going to get paid at some point. The only difference between all these different accounts we're talking about is when you pay taxes. And so for a lot of people, especially if you're crushing it in the real estate game and you're making money, you have like cash flowing assets and maybe you're making a lot of money eventually you don't want to have to get taxed on top of that with your retirement withdrawals. So you want to use a Roth for a lot of folks like that. If you think you're going to have high taxes in the future. And if there's one thing we know about taxes, they typically go in one direction. Up now in 2023, the income or the contribution limits have increased with inflation. So you can actually contribute up to 6,500 to a Roth or a traditional IRA. And when can and should you use a Roth IRA? Again, if you have a 401K and you're already taking the match and you qualify, you don't make over the income limits for a Roth ira. So if you make over a certain amount, you can't contribute directly to a Roth ira. And then if you're a business owner and you're trying to figure out what to contribute to, if your net business income is less than 676, is probably a little higher than this now, and you don't plan to invest more than 6k in the stock market, a Roth is a great option for you. I am going to mention this for people that are higher earners that can't contribute directly to a Roth ira. If you make too much money, great problem to have a backdoor Roth IRA is a strategy used by people to convert traditional IR money IRA money into a Roth ira. So what it means is you put money in the traditional Roth and or the traditional IRA and you roll it over to a Roth. It sounds shady, it's super legal and it's a great way for high earners to get money into a Roth ira. So something to think about.

There are, however, you could basically put like a thousand bucks in a traditional, roll it to a Roth, pay the taxes on the thousand bucks and then you have a Roth IRA to contribute to.

Exactly, it's completely legal. The only thing you want to be careful of is if you have other IRAs like a SEP IRA or you have a high amount, you have to make sure you talk to an accountant about this if you have other IRA money because there is a tax rule called the pro rata rule that I'm not going to share because I'm going to butcher it. It's very complicated. But basically what happens is if you have other IRAs, the government will tax you on your full IRA amount. So anyone doing a backdoor Roth IRA, it is worth a hundred or two hundred bucks, whatever it costs to couple hundred dollars to talk to your CPA and just double check that you're not going to have any tax issues. It takes two seconds, it's worth it. Cool. And then for self employed people you have wonderful options too. The SEP IRA is a simplified employee pension. It's super easy to open if you're somebody that's a business owner that's been thinking I need to open a SEP. You can do it in 20 minutes if you have a ein. So don't wait because you think it's going to be a lot of paperwork. It's actually really easy. And you can contribute up to 25% of your total compensation up to $61,000. That's huge. That can reduce your taxable income like crazy. If you are making good money in your business, you need to think about this and you can contribute to a Roth and a SEP ira. So lots of options to reduce your taxes. And setting this up is easy. Just contact a brokerage, you complete a form, put in your info and that's pretty much it. If you have other people in your company, you do usually have to give them the same percentage compensation. But this is a great way to get started. Another account for business owners is a Solo 401K. If you don't have people in your business that you're paying W2 employees, you can use a Solo 401K. It's a little bit more paperwork, but the tax benefits are even bigger than the SEP IRA because you can contribute as yourself and as the business. So you kind of get an opportunity, contribute to both and reduce your business taxes and your income taxes. They're both great. Just depends on your situation. Solo 401k is only unfortunately a good fit for people that are solopreneurs. And then lastly we talked about this self directed IRAs. So the when I say self directed IRA, what I mean is not a Roth traditional or a sep. It's a specific ira. And I think John mentioned Equity Trust Quest is another one where you can roll over your monies and have what's called checkbook control. And this means you can use that money to invest in real estate, you can use it to invest in gold, silver, crypto, bitcoin. Proceed with caution. I think real estate's probably one of the better options to do a self directed ira. But it's an, it's an awesome way to use your money for other types of investments that aren't the stock market.

Yeah, you just gotta make sure you're not investing in insurance premiums or insurance contracts. Collectibles is another thing. And the thing about a subject IRA is your custodian is going to take. You got to make sure the investment is labeled properly in a lot of cases.

Yep, yep. Thank you. And lastly, avoiding industry fees. We don't have a ton of time left, so I'm going to wrap it up here. But here's some common investing fees. Financial advisors, if you don't know how much you're paying your financial advisor, figure it out. Because as you've seen, 1% on $50,000 over 30 year period is $200,000. That is a lot of money to pay someone. Something that you could learn for a couple hundred bucks over a few weeks. Weeks. So something to think about. Mutual funds that aren't index funds can have super high expense ratios that aren't worth it. You can often find the exact same. So when I had my financial advisor that had me in all these investments that were really high fee, when I went in and bought the same ones myself, the same exact investments, like 99% of the same stocks in that same fund, I was able to get them for 0.05% or were 0.1%. Whereas the same exact fund she had me in were 1%. So you can pretty quickly learn how to invest in index funds and save yourself some serious, serious money. So if you are investing with financial advisor or someone else is doing your retirement accounts for you, make sure you learn that. I can't stress that enough. If you have an old 401k, you have the opportunity to roll it over. And then if you're in target date funds, that's a big one. Sometimes target date funds can actually have really, really high fees.

What's a target date fund?

That's a good question. I'm going to see if I have a slide in here about a target. I don't have a target day fund. So a target date fund is a, is a fund that includes stocks and bonds. And the reason it's called a target date fund is because usually in the name of the fund it'll say for example, Fidelity has them and they say Fidelity Freedom 2050 or you'll probably see them in your 401k. If you don't know what you're investing in right now in your 401k. I'm 99% sure it's a target day fund. And the intention of these funds is to create a mix of stocks and bonds that decreases the amount of stocks, decreases your, your stock exposure and increases the amount of bonds you have over time. And the reason they do that is because bonds are historically more stable, less volatile than stocks. And so when you get closer to retirement, that target date fund is going to be more invested in bonds and less invested in stocks. So it's not a terrible investment. The problem is that target date funds that aren't target date index funds have very, very high fees. And a lot of times you could, with a little bit of effort, create the exact same portfolio for a tenth of the cost and reduce your fees right away. So there are target date funds out there that are good, but they're few and far between and you have to really look at the fees. So if you don't know what you're invested in or your 401k, make a note and go check after this. And if you're in a target date fund, you want to see what the expense ratio is because it could be very high. And you could very easily pick a stock market index fund and a bond market index fund and create a portfolio split that does the same exact thing, but is way, way cheaper.

Makes sense.

Yeah, great, great question. So you've. I've mentioned index funds a couple of times. If you don't know what they are, I'm going to end with this. An index, by the way, is just a grouper, stocks or bonds. So you've already learned about one. Tonight we talked about the S P 500. That's an index. Index Index is just a fancy name for list. The financial industry can't make things easy, so they call it an index. And index just means list or group of stocks and bonds used to measure the performance of the stock market. So you could invest in an index fund that tracks the S P500. And what's great about index funds is because they are not funds that are being actively managed, they're cheaper. Because what happens with A S&P 500 index fund is the fund manager goes, what are the top 500 largest companies in the U.S. they're these ones. I'm going to put it in this fund and that's it. So it doesn't cost them a lot of time. Or energy to manage it. And you'll see this is the, the S&P 500 index fund. So you'll see a bunch of of stocks that you know, companies you know, Microsoft, Apple, Google, Amazon, Home Depot, Tesla, these are all in the top five 500 largest companies. And so this is a really easy way to diversify your investments very quickly without having to select single stocks which can be very risky. So you can build a portfolio with a couple of funds that will outperform actively managed funds when and that actively managed is when a portfolio manager is or a money manager is managing a fund and they're trying to pick stocks stocks to outperform the market which as we've talked about is really, really hard to do. So John, I see your question. I'll come back to it in a minute. So the real secret to building wealth here is time. Investing consistently with a simple strategy, using retirement accounts when you can. Investing in index funds are cheaper and easier and doing it consistently, that's pretty much it. So I hope that I'm going to click here. So I hope that this was helpful. I didn't finish the slide apparently. I have a free 401k guide that I will drop in the chat for those of you that are interested. And then I also have a list of investing terms that I talked about tonight that if you want to just have these in your back pocket as you learn, you can grab those. So I'll drop those in the chat for you. And then John's question. Can you explain what an exchange traded fund is? Yes. So when you go to buy funds you'll see mutual funds and ETFs and for most people this isn't a huge difference. ETFs are pools of are basically traded like on the stock market all day long. A mutual fund that's not an ETF is a pool of investments that only gets traded once a day. That's the main difference. There are a lot of differences in how they are structured exchange traded funds. The money is pooled differently than in a mutual fund but most of the time it doesn't really matter. There are some small tax advantages to an ETF but it's not really enough to write home about, at least in my opinion. So if you're investing in index funds, there's going to be an S P500 index fund and there's going to be an S P ETF death and it's pretty much six in one, half a dozen in the other.

I got a question here online from somebody asking, hey can you help them with some of the things you suggested? Like if they pulled their 401k statement, could you help them with some of these things or is that not something that you do?

I don't typically do one on one, but I do do 401k workshops and I would be happy to. Maybe that's something we could set up another time when we go through the, the 401k, we could screenshot somebody's and go through it if that would be. But if you have questions, definitely email me and I can at least get you on the next, get you on the right track and that checklist will help as well that I just, just linked there. But yeah, if you're live, shoot me an email or I'm on Instagram with wealth with Tess and if you have questions and I'm happy to help you out there as well.

Great stuff there. Good stuff there. I learned some stuff which is always a great thing.

Oh good.

So Peter asks, so again, the 401k is the same as a TSP pretty much.

The investing options are pretty limited, similar to a 401k. But yeah, it's similar many ways.

Yeah, it's just that your, your things is monitored by the state. A lot of times the states will have a different acronym for the retirement plans.

Exactly. Like 403B is the same if you're a teacher, you have a 403B. The fees are really high, which sucks. I don't, I'm, I don't know all the details or it's even worse for teachers. I don't know why we're so terrible to teachers sometimes. But yeah. So if you're a 403B and you don't get a match, it might not make sense for you to Invest in a 403B. You might want to just invest in a, in a Roth IRA or traditional ira.

I've got somebody online asking a question about your Money Confidence program or something you mentioned earlier on. Can you talk a little about that?

Sure. Yeah. So see if I have some slides. So the Money Confident program is a five week program where I walk through all the basics to help you set up all the stuff we just talked about. So the first week we just talk about setting financial goals. So that could include real estate, it could include what you need to retire. And there's ways to approximately calculate how much you'll need in retirement. Most people have no idea how much you'll need. So if you're sitting there going, I actually don't know how much I need in retirement. We do that in week one. Week two we set up actually. Do I have a slides here? Yeah, here. So it's one hour per week. It's all online so you can just take the video. So for the person that was asking about the 401k this would be the way to do it. It's self paced. Online you can learn exactly how to implement a low maintenance strategy. Which retirement accounts are you. It includes small group coaching. So if you did want to get your 401k looked at by me that's this is how you could do it. So week one is your goals, figuring out your whys. Week two is making sure you have all the, the foundation set up. So if you have investment real estate or you have a house or you have other fees we or expenses, we want to make sure that's all organized so you can figure out exactly how much per month you have left over to contribute towards your retirement accounts. Week three we go through in detail all of the retirement accounts and then my personal favorite part of the program, whether or not you need a financial advisor. Not that they are all bad but there are important questions you need to be asking them. There's better options, there's fee only advisors which I love. It's a great model. If you have questions that's not charging you constantly. And then week four, all the stock market investing, what is a stock, what is a bond? What are all these terms that I get assaulted with when I try to learn this stuff? So that's what we go through in week four and then week five we tie it all together. So each week is a different topic. We have a lot of fun with that program and it was actually just on sale and the sale just closed. So if you're interested, shoot me an email and I will give honor that sale for anybody that is part of Scott's awesome community. So if you're interested in that program let me know tessoneyconfidentcoach.com and we'll, we'll sneak in.

John asked a question here which we get this. I'm past my retirement age and still working. Do you talk anything about Social Security?

Not much. I mean if you're past retirement age, I think you just kind of have to do some of the math that we were just talking about. Right. Like what's your Social Security going to be? You're probably going to get your Social Security, others of us might not. So figuring out how much you have in your retirement accounts, how much you're going to need each year and then how much your Social Security is going to contribute to that. I think that's going to be really important for you to figure out, you know, how much you need to be saving, how much longer you need to be working, etc.

One of the things that I like to do is it's still good to figure out how much money you would need and what kind of monthly you need and then deducting that, divide that number by number of cash flowing notes or cash flowing properties and figuring that out, you know, because, you know, 3 million, 4 million, $5 million seems very intimidating if you're sitting at zero. But if you think like, oh, I need to be making 60 grand a year in income off of, you know, a million bucks, okay, that's not so bad. We can break that down to five grand a month. That's ten performing notes. If you put a plan together, you can make it happen. That's all about, like you said, it's all about planning and working through it one day at a time. Right, Tess?

Exactly, exactly. Yeah. And that's what we talk about in, in the course a lot too. Like, there is a, it's. None of this stuff is super hard. It just takes some time. And if you're committed to making sure that your money is on track. I talk to people all the time and they're like, oh, well, I want to take your program, but it's, it's 4,404 47 right now on sale for, for all of you. And they're like, I want to take your program, but I don't have time or money. And I'm sitting there like, okay, but it's five hours of your time and it's less than 500 to save you and help you make thousands and thousands of dollars. Like it is worth taking whatever next step you want to take, whether it's, it's my program working with Scott, whatever it is, it's worth doing it. I mean, I, the mistakes I teach in my program cost me personally at least $80,000. So like I, I wish somebody had come to 12 years ago test and been like, hey, here's a four or five hundred dollar whatever it is, couple grand to learn this stuff. It's so worth it. It's never not worth getting a financial education. I, I can't stress that enough.

Yeah, exactly. They don't teach it in high school or college a lot of times. And we got to get through the school hard knocks in a lot of cases.

Yeah, exactly. I'll drop on that. I'LL drop my link to the program like it's not on sale. It doesn't say it's on sale but it is 50% off for all of you. So if you are interested, just shoot, shoot me an email and I'll get you in.

Yep. And then your email once again is test moneyconfidentcoach.com. right.

That's it. Yeah.

Awesome. If you're watching the replay, make sure to take advantage of that. We'll put the links in the description in the chat roll as well for you guys out there. But Tess, this has been great. Thank you for taking time on your busy night there. Glad the power stayed on there for you.

Yeah, we got lucky. We got lucky. Yeah. Thank you so much for having me. It was so fun to chat with you all and and yeah, if you need anything at all, shoot, shoot me a message. I'll help you out.

Awesome. Good stuff there, guys. Well, that will wrap it up for this note night in America, everybody. Hope you enjoyed what Tessa, to share with you some knowledge there. I learned some things. You know, if you're got, if you're working, look at the fee structure, look at what you're invested in and start exploring the facts. Especially if you're sitting down an old 401k or you know somebody with an old 401k who's been laid off. That's a possible easy conversation. Hey, you need to move your 401k into something. Let's start saving some fees or putting that that money to work and start making you more money. So easy way to have that conversation and put you in a knowledgeable space out there. So go out, take some action everybody, and we'll see you all next Monday night. Thanks again, Tess.

Bye. Thanks, Scott.