Your Retirement Income

Millions of American workers plan to retire this year. Many wonder if they'll have enough to stay retired.

Hi, I'm Rob West. Inflation, interest rates, the stock market, and the economy in general all can have an impact on retirement planning. How much does the average retiree need to live on? I'll talk about that first today, then it's on to your calls at 800-525-7000.

That's 800-525-7000. This is MoneyWise Live, biblical wisdom for your financial journey. So speaking of wisdom, the conventional wisdom is that after you stop working, you can live comfortably on 80% of your pre-retirement income.

Financial planners arrive at that figure for a number of reasons. Once you retire, you'll no longer be putting 10% of your income into your retirement account. And since you're no longer earning a salary, you won't be paying 7.65% of it in Social Security and Medicare taxes.

You'll no longer have work-related expenses like travel and clothing. And finally, a portion of your retirement income will come from Social Security benefits, part of which are always tax-free. Okay, so as I said, the rule of thumb is that you need 80% of your pre-retirement income. But a survey of recent retirees by T. Rowe Price found they were living on only 66% of their final working salary, and they reported being content. Granted, those surveyed were described as relatively affluent, but the number is still somewhat surprising.

How are they doing it? Well, it turns out that many of them saved more than 10% of their income during their working years. That not only increased the value of their portfolios, it also trained them to watch their spending and stick to a budget. Another huge factor was making it a priority to pay off their mortgage before retiring, eliminating what is usually the biggest household expense. Finally, their kids had grown, left the household and become financially independent. In addition to that, successful retirees have found any number of ways to either cut their living expenses or increase their income.

Here are a few examples. Some empty nesters have looked around their unoccupied bedrooms and seen dollar signs. There are services like Roommates for Boomers and Silver Nest that can help you rent out a room in your house. Now COVID has put a crimp on that idea for the time being, but as the pandemic eases, it will become a more viable option. Many retirees take to gardening as a way to get fresh air and spruce up the landscape. It's not a big leap to put in a vegetable garden, and everything you harvest reduces your grocery bill.

Beans, tomatoes and cucumbers can be frozen, while potatoes, onions and squash can be stored for several months. Adding more vegetables to your diet is healthy and could lower your medical expenses as well. And while you're working on healthy habits, you can get rid of some unhealthy ones, again to reduce medical costs. Smoking and excessive alcohol consumption are major causes of health issues in the elderly.

Replace those bad habits with healthy ones, like staying fit. And there are many free or low-cost fitness programs available for seniors. You'll save money, feel better and live longer by taking care of yourself. Do you really need two cars once you retire? You can save on insurance, registration and repair costs by getting rid of one of them.

Ride sharing, if needed, is a low-cost alternative to maintaining a second vehicle. You should also ask yourself, at this stage of life, do you really need life insurance? It's supposed to replace lost income if you should die. But if the kids are grown and out of the house, you no longer need to provide for them. And now that the house is paid for, do you plan to continue living there as long as possible? Most retirees want to stay in their homes, and it's the cheapest place you can live, far cheaper than moving to an assisted living facility or nursing home. You're more likely to be able to stay in your home if you make it safe and accessible as you age. Carpeting reduces the chances of injury from falls. Installing grab handles and mats in bathrooms is also a good idea. Curbless showers and walk-in bathtubs can also extend the time you're able to care for yourself as you age. But by far the most important thing you can do to keep living at home is to exercise. Staying fit and limber is a prerequisite for taking care of yourself and staying out of a nursing home. Well, those are some ideas that can help you retire comfortably and probably on far less than 80% of your working salary. But here's the key. You have to be diligent in saving for the future, which means if you're not putting something away for retirement, start right now.

We recommend 10% to 15% of your income going into long-term retirement savings. All right, your calls are next. 800-525-7000. That's 800-525-7000. This is MoneyWise Live.

We'll be right back. Thanks for joining us on MoneyWise Live, biblical wisdom for your financial decisions. Just a moment, we'll be taking your calls and questions on anything financial. Here's the number, 800-525-7000.

That's 800-525-7000. We just had a caller a moment ago looking for a state planners who operate from a biblical perspective. And let me take that opportunity to talk about the CKA designation. We recommend often the Certified Kingdom Advisor designation. It's the only industry accepted designation in the financial services industry around biblical, professional financial advice.

That is men and women who have met a high bar in terms of training and competency, regulatory reviews, pastor and client references, and specialized training to bring a biblical worldview to their financial decision making. It's why that's the designation we trust and you can find a CKA in your area. Just visit our website MoneyWise.org and click Find a CKA. By the way, if you're looking for a godly estate planning attorney, although we do have some, there's not a lot of CKAs in that specialty.

So I would either do one of two things. Either contact a Certified Kingdom Advisor in your area and ask for a referral to an estate planning attorney. They'll all have one that they use and make sure you let them know that you want your biblical values reflected in your estate planning. Or call your church and ask if there's somebody in leadership there that's also an estate planning attorney. That could be another great resource. All right, we'll head to the phones now. 800-525-7000 is the number to call. We're going to begin today in Moline, Illinois. Hi, Kelly. How can I help you?

Hi, Rob. Thank you. I had always heard that you could get 50% of your husband's Social Security.

Mine was very small and his is quite large. And I called to get that arranged. I took mine at 62. He took his at 60 just right before 66 because they said he could and not be penalized or whatever, you know, like a couple months ahead of time.

But anyway, so when I called to get that up when they didn't do it automatically, they said because I took mine at 62, they took out 30, you know, I don't only I only get 30% instead of 50%. And I was learning that I did. I listened to your call about Social Security stuff. And it didn't sound you never mentioned that. So I'm wondering what do you know about that?

Sure, sure. Well, you your full spouse's benefit is up to one half the amount your spouse is entitled to at their full retirement age. If you choose to begin receiving spouses benefits before you reach full retirement age, your benefit amount would be permanently reduced. Now, that's separate and aside from your own benefit, and you can choose from whichever is higher as to which benefit you will collect.

But at any point you elect to take either your spousal benefit or your own benefit early, it will be permanently reduced based on your age and that age in proximity to full retirement age. Does that make sense? Well, no, I understand that. But I thought that I so I took mine knowing that it was going to be reduced. But as soon as I is, I don't get 50% of his regardless.

I mean, I already know mine was weight. Mine is way less than his. But so is it right that I only get 30% of his instead of 50%? No, it would just depend on when you claim that that benefit. So if you took it at 62, it'll be reduced by about 35%.

And that's permanent. At any point, though, you would be able to make the switch. So if you took your own benefit early, that would be permanently reduced. But then at some point, you could switch to your spousal benefits or vice versa. But you can't take both, you would take whichever is the higher of the two.

And whenever you begin claiming them, they're permanently reduced from that point. Well, that's that's what I mean, I did take mine. And then I went to I'm 69. Now I called last year at 60. You know, when I was 68, to get it switched to the 50% of his. And they said, I only get 35% of his because I took mine at 62. And I have friends that aren't having that experience.

So do you think who? Yeah, so what I would do is, I would contact the Social Security office. You know, if, if you start the payments at full retirement age or older, you should get the full benefit of 50%. Unless there's some aspect of this that I'm missing. So perhaps, you know, try with somebody else, you can contact and make a virtual visit ssa.gov. But I would dive into that a little deeper and see make sure you're getting the correct information as to how much of your spouse's benefit you're eligible given that you've not claimed it previously and certainly not prior to full retirement age.

So something doesn't sound quite right. I'd look into that a little bit further, Kelly and be sure to check back with us and let us know what you find. We appreciate your call today. 800-525-7000 is the number to call. We've got several lines open today.

Let's head to Lakeland, Florida. Hi, Maria. Thanks for calling. How can I help? Hi, Rob.

I have two quick questions. I have been unemployed for the last four months after working for non for profit for 29 years. I invested in the full three B. I also have a smaller account with a traditional IRA. And at this point, since my full three B, I'm not making any contributions or no company match. Should I roll it over to the traditional IRA and just have it on the one, you know, one account? So you have an IRA already in addition to the four or three B? Yes.

Okay. Yeah, you certainly could do that. How much do you have in each of those accounts roughly? 400,000 on full three B. And on the the IRA, I have probably about 90,000.

Okay, very good. Yeah. So you obviously got a significant amount of money that you've saved. I think it's actually a good idea, Maria, because at this point, I'd rather you have a little bit more investment oversight than you perhaps have in the four or three B where you're just picking from the mutual funds.

Not that you can't do that and do that. Well, there's plenty of options, I assume, in that four or three B. And I'm sure you're giving careful thought to which ones you're in. I would just love with you having a half a million dollars here for somebody with some professional expertise and maybe a little bit more attention, you know, to oversee all of that and do it in a way that's consistent with your goals and objectives, not taking any unnecessary risk, especially with us heading into a, and we're already there, a choppier market has a little more volatility associated with it. And given your proximity to retirement, whether you plan to go back to work or not, you know, we want to make sure you're only taking the appropriate amount of risk there. So I think rolling that out into an IRA does a few things for you. Number one, it's not a taxable event. Number two, you're no longer paying the fees that you have inside that four or three B that you don't really see, but they're there.

So you have more control over the fee and cost structure. Number three, you open up the investment universe. So, you know, that horse with blinders, the blinders come off and now any stock bond mutual fund, exchange traded fund, even real estate, you know, through a self-directed IRA is available. Not that you'd do that necessarily, but the idea is that really any investment is now in play and how much involvement you want to have or whether you want to bring an advisor to the table.

All of those things can really be solved for quite effectively inside the IRA. So that would be my recommendation. If you don't have an advisor currently, Maria, I'd visit our website and perhaps see if you can find two or three certified kingdom advisors there in Lakeland to interview, see which is the best fit.

Make sure you understand their cost structure, how they get paid, where you'd fit in their overall lineup of clients, who would be servicing the account, all those things, and then find someone who's a good fit for you. We appreciate your call today. All the best to you in the days ahead. 800-525-7000. Thanks for joining us today at MoneyWise Live. We're so glad you're along with us taking your calls and questions on anything financial. We'd love to hear from you today.

800-525-7000 is the number to call. Let's head right back to the phones. Let's see.

Philippe is in Florida. Go right ahead. Hello, Rob. How are you doing? Doing great. Thank you for calling.

Great. Rob, my wife and I, we are a young couple. We moved from Jersey to Florida about three years ago. We have a two-year-old son, and then we were focusing on paying our debt. Right now, we are at a point where we are looking to purchase a house, and we managed to save $10,000.

So we wanted to know if it's a wise decision to go for that decision, whether it's a small apartment or condo, or should we wait? I see. Okay. So tell me how much you're looking to spend. I mean, what have you been targeting in terms of a purchase price? I would say anything between 180,000 to 230,000.

Okay. So let's call it 200,000, somewhere right there in the middle. And how much have you saved?

So far, 10,000. We're actually saving quicker than before because we were focusing on our debt payment. So right now, we're just putting money towards our saving more.

That's great. Yeah, that tells me you're really, you know, reigning in your lifestyle spending, which means you're freeing up margin. You had been focused on both saving and debt reduction. Now that that debt's gone, you're going to be able to accelerate that saving even quicker.

And those are all really good signs, Philippe. You've got 10,000. I'd really love for you to have 20,000. And I realize, you know, that's going to delay this purchase, but that's going to put you into a home with 20% equity. It may in this interim period also, you know, be a situation where the housing market settles a little bit. Right now, it's just really a seller's market where there's bidding wars going on because of the lack of inventory. People are paying prices that are 10 and 20 and sometimes even more than that percent higher than the asking price.

And so I'd love for a little bit of that to kind of settle out of the system. The flip side is interest rates are headed up. So we're going to pay a little bit more for interest down the road.

You know, I'm talking a year or two from now, but it's still going to be historically speaking at historic lows, even if it's a point higher than it is today, which I don't think it will be in the next year. How much would you be able to put aside every month if you delayed this and really prioritized increasing your down payment? I'll say a good of $1,500. $1,500 a month? Okay.

Yeah, so that's great. So I think the goal would be to get up to 20,000. Now, if you were to do that, do you have in addition to this 10,000 an emergency fund or is this all of your savings? This is actually all of my savings. We are actually building emergency fund as we're saving for it. Okay.

And are you building that separately or it's kind of all in one account? We're going to separate it. Okay.

But today the 10,000 is everything, emergency and down payment? Correct. Okay. All right. How stable is your job situation? I have a stable job. My wife has a stable job. We both have our career job right now working. Okay.

All right. Well, I think what I'd love for you to do, Felipe, is to have 20,000 down plus at least a month's worth of expenses in the bank. That would be my goal. And I say 20,000 based on the purchase price. Well, actually, if you're talking 200,000, I'm sorry, I'm not sure what I'm thinking here, it would actually be 40,000 because I'd really like for you to have 20% down.

So it's going to take you a little bit longer to get to where I'd like you to go. But for you to go into a house with just 5%, I just wouldn't feel comfortable. Number one, you're going to be paying private mortgage insurance. Number two, if the housing market were to take a dip, you guys could find yourself upside down.

And even though you'd probably plan to be there for some time, it just could put you in a really tight spot. So I'm going to say at this point, as much as I'd love for you to get into a home and not be renting anymore, I think we just hit the pause button and continue to save. The good news is you guys have demonstrated you're able to do it. You're putting away a good bit a month. You'll be putting away 18,000 over the next year. And who knows, if you guys really dial into this, you know, maybe you can do even more than that.

But I think I would wait until you can put 20% down and make sure that the mortgage payment that comes with whatever mortgage you take is not more than 25% and at the most 30% of your take home pay. So Philippe, we appreciate you checking in with us. Thanks for listening and calling today my friend. God bless you. To Michigan, Tracy, thank you for calling.

How can I help? Hi, thanks for taking my call. I just paid my house off last week. I'm thinking about retiring at 62, which will be in two years. I have no debt and I have about 20,000 for emergency funds, but I have a 17 year old car. So do I take that money that I'm no longer using for a house payment, which I already upped my retirement up to 15% from nine taken out of my pay and then they match three. Should I take the money that, like my house payment money, put it in the bank for a new car?

Should I put it in something that's really going to, you know, collect some sort of decent interest? And what, what would that be? Yeah. How far away from retirement did you say you are?

About two years. I'll be 60 in April. Okay. And what will your retirement income consist of other than social security when you claim it down the road?

Well, I could get a part time job. Okay. Do you have a retirement account at work? I know you mentioned you've been putting in nine now it's 15.

What is that? What have you put away in that? How much do you have saved up in your retirement account? About 135,000. Okay. 135,000.

Yeah. So I mean, obviously if you're retiring before taking social security, I would look to that 135,000. Let's say it grows to 150,000 between now and retirement. We'd be looking at probably 6,000 a year from that. So 500 a month. So I think, you know, either delaying retirement or as you said, working part time, you know, you could look at the retirement account as a source of income.

In terms of a car, I would say, yeah, just redirect what you have been putting toward the house and put that all toward the car. Hang on the line. We'll talk more off the air. This is Money Wise Live.

We'll be right back. Thanks for joining us today on Money Wise Live, biblical wisdom for your financial decisions. We're so glad you're along with us today as we apply God's word to your financial decisions and choices as we think about managing God's money.

And it's all His, right? Psalm 24, one, the earth is the Lord's and everything in it. So that means we're stewards and money is a tool to accomplish God's purposes. You know, as we think about all the uses of money, there's really only four categories. There's the money we live on, the money we give, the money we owe, and that really would be debt and taxes, and then the money we grow.

That's our savings, both for the short term, like your emergency fund, or the long term, like your investments. But among that, live, give, owe, and grow, there's principles. We pull out of God's word and apply to each of those. But at the end of the day, we want to live, as the apostle Paul said, with contentment, which is learned, by the way. It means we're willing to live within God's provision, not outside of it through the use of debt, that we live open-handedly so we can follow the leading of the Lord and give, just like the early church did. This morning in Acts 11, I was reading about the church at Antioch that sent quickly money back when the prophecy was given about the famine to the more established church in Jerusalem. They were so quick to give and support that need because they had the ability to do so. And when we live that way and order our finances that way, living simply and living below our means, we have the ability to respond to needs when they're presented.

Well, that's, I think, God's heart and his design for how we should be as stewards of his money. Hey, let's do that together today. We've got some lines open. What are your questions on saving or giving or investing or spending plans? Whatever it might be, we'd love to hear from you. The number to call is 800-525-7000. We've got about four lines open.

Zion, Illinois. Hi, Charlie. How can I help you today? Hi, Rob. How are you? Doing great.

Thanks. Listen, I have a question about, I left one job five years ago and I left my full 1K there. And I know I have like $50,000 sitting in just the cash and the rest of it is tied up in like stock, average stock and those things. And now I'm with the government, US government, and I have like $58,000 in there.

So my question is, should I put this all together? Yeah. So you have this old 401k, but what else do you have? Do you have an IRA or what other type of retirement account do you have? A TSP? I have a TSP account.

Okay. So you have the TSP currently, which you can't do anything with that because you're still with the government. So you just need to pick the funds inside the TSP that are most consistent with your age and objectives. But do you have anything else other than the old 401k? No, I just switched my TSP and I thought maybe I should be putting money instead of my TSP. I thought I should start putting it in an IRA. Well, I like the TSP account and you can do that.

You can put more away in the TSP each year than you can in the IRA. You're going to hit that ceiling pretty quickly at $7,000. You mentioned you have $50,000 in your 401k in cash.

What else do you have in there? What's the total balance? It's like $130,000 total, which is primarily the stock that I was with that company. Yeah. Oh, I see. So it's one individual stock. Yeah. Okay.

Yeah. So we need to make a change on that because if you've got $80,000 at the risk of one company, you're highly concentrated. That's risky because if that particular company, whatever it is, is as good as you may think they're doing, if they have a bad quarter or something happens, that stock could go down significantly and there's just too much risk there. You're not properly diversified. So I'd be looking to move that out and find an advisor that could take over management of that. Once you found that advisor, he or she would open an IRA, an individual retirement account, and then the 401k would be rolled in. So it's not a taxable event and at that point, any investment could be selected on your behalf based on your goals and objectives. But the $50,000 shouldn't be in cash because that's losing purchasing power every month and $80,000 shouldn't be at the risk of one company. They can also advise you on the appropriate fund mix from your TSP account to make sure that you're in the right investments that match your goals and objectives.

But in terms of the go forward, how you should approach it, I would continue contributing to the TSP, just making sure that you get some counsel on what investment mix you should be in. So I think your next step, Charlie, is to find an advisor that you'd feel comfortable with. I'd interview two or three certified Kingdom advisors in your area.

You can find one when you head to our website, moneywise.org. Just click find a CKA. We appreciate your call. Louisville, Ohio. Daniel, thank you for calling.

How can I help? Hi, I appreciate taking my call. Sure. I had just a question.

I was wanting your opinion. We purchased a home about seven years ago and we had a 30-year mortgage. The interest rate was 4.125 and we had paid it down quite a bit and I was on schedule to pay it off actually in about a total of maybe 13 or 14 years.

In total, we'd have been done. Then I refinanced and the interest rate went down to 2.75. When I refinanced, well, actually right before we refinanced, we needed an extra bedroom because we'd been blessed with another child and so we decided to build onto the home. First, we got it under roof, dried in and working on the electrical and the plumbing right now and we were just using money that we'd saved up or just extra money that we had left over. When I refinanced, I thought well – and we were going to continue to do that through the duration realizing it would maybe take a few years to completely finish it. Then when we refinanced, I thought well maybe I could just borrow some in addition to just the mortgage that we had, all wrap it into the same refinance and then that way we could finish up the project sooner. So I was just wanting – and that's actually what we did. I still have the check for the extra for the part that we're going to use for the addiction.

So I could go either way on that right at this point but I was just wanting to know your opinion. OK. So in the refi, did you – you said you did pull some money out or you have the ability to? Yes.

Well, I did. I owed like approximately $43,000 yet on our home and then I borrowed an additional $25,000 to help speed up the addition project and that is a 10-year loan that I got. So which would make the point from when we purchased the house to the point when we finished paying everything off, the original mortgage including the amount that I borrowed for the remodeling project would be about 16 years total.

OK. All right. And you said – so the total mortgage right now is at about $68,000, is that right? Yes. Yeah, that would be about right, yeah. That's 2.75? That's correct. Yeah.

I think that makes a lot of sense. I mean this is really cheap money. If you had already refinanced and you hadn't factored this in, I'd say don't touch it. Let's go get a home equity loan, not a line of credit but a loan with a fixed interest rate just for this project. But if you've already taken this money, that helped you get this loan because that $43,000 was below what most lenders want to do for a new first mortgage.

They usually want $50,000 or more. It's a phenomenal interest rate and because you all are accelerating the payoff, I would be comfortable with it. So I think this is a good approach, Daniel.

I'd stick with this plan, OK? I appreciate it. Thank you so much. All right.

God bless you. This is MoneyWise Live. We're applying God's word to your financial decisions and choices. We're going to pause for a brief break. We come back much more on the program.

Stay with us. Thanks for tuning in to MoneyWise Live. Our MoneyWise Weekly Wisdom email went out today. If you didn't get it, that means you don't have a free account at MoneyWise.org.

So head over there now, create your free account and then you won't miss another one. The theme of this was financial stress relief and I share my thoughts on how we can avoid stress in our financial lives. We also have some great recommended reads, how you set a financial finish line and how you can read the Bible well and make sure you're not proof texting, especially when it comes to financial issues. We have some great podcasts there and our verse of the week, which is a great one. It's really the basis for everything we do here at MoneyWise. Psalm 24, the earth is the Lord's and everything in it, the world and all who live in it.

And that is the pivotal truth that when we recognize God owns it all, it changes everything, every spending decision, because we're now managers of the King of Kings resources, which means we're looking to him to say, Lord, what would you have me to do? How should I handle your money? Again, we'd love for you to get this weekly wisdom email.

Just head to our website, create a free account at MoneyWise.org. All right, let's head back to the phones. Joe is in Cleveland, Ohio. And Joe, I understand you have a Social Security question, huh? Yes. How are you doing? Doing great.

Go right ahead. Well, I was wondering if my wife can get some Social Security benefits as part of a spousal benefit. She never earned enough credits to get her own Social Security. She's short about 40 credits. She's short about four or five credits. And she has a public pension. I do. And I have limited, but I was able to get some Social Security based on credits.

I see. Yeah, that only applies to her own benefits, Joe. So she can claim spousal benefits even if she has no credits at all. So she could start receiving spousal benefits at age 62, but those benefits would be permanently reduced by about a third for not waiting until her full retirement age.

If she waits till her full retirement age, whether that's 66 or 67, she's eligible for up to 50 percent of your Social Security benefits. But she's entitled to that, whether she has any credits or not. Oh, OK.

So there is actually something called that spousal benefit. That's exactly right. Right.

Right. Now, ours is limited because of our public pensions. So, for example, I waited till 70 and my Social Security amount is like about 600. So if she applies for half of that or something, she's approaching 70 as well. Yeah, they'll tell her what she's entitled to, but I would have her go ahead and check into that right away. There's no reason not to claim that benefit. And you can connect with SSA.gov to get more information.

So hopefully that's some good news. Give you a little bit more in the monthly budget. We appreciate your call. Tyler, Chicago, Illinois, how can I help you, sir?

Hi, my wife and I moved in. We're looking for a local church in the area. And what do you think is the best way that we would honor God and be faithful to the Lord with our tithes and offerings while we're not rooted in a particular local church? Yeah. You know, I love this question. I would just say continue to give systematically.

So I wouldn't break that rhythm. You know, I think there's something about giving the first and the best off of our increase to the Lord. I would say if we're going to apply the principle of the tithe, we should start with giving to our local church.

That's God's plan A. In terms of the mechanics of that, while you're in between churches, I would say you've got a couple of options. You can continue giving the tithe to your current church while you're looking. You can give your weekly tithe to whatever church you're visiting would be another approach. You could give your tithe to other ministries until you land in a new church.

So I think any of those would work. That's between you and your wife and the Lord. But I would just say let's just continue giving faithfully.

And there's just something about exercising that giving muscle that I think is a good thing that I'd love for you to not break and, you know, just start storing it up. Does that make sense? Yeah. So like it would be kind of the same to give to another ministry, even though that we believe is faithfully honoring God. You know, because there's so much emphasis that Scripture gives on supporting the local church. But if we're not there yet, do you think it would be supplemental? Well, you know, if you have that conviction, and I would share that, so I'm not disputing that at all, that that is God's intention that we start with our giving to the local church. We could look at Malachi.

We could look at a whole number of places where that's modeled. Then I would say follow that conviction. And so that would limit your choices to either where you're currently at, if you're a member somewhere, or perhaps you just take your weekly tithe, look at what's the provision this week that God's given us and what's tenth of that, and then write that check or make that electronic gift to that particular church you're visiting until you find out where the Lord is leading. I think that would be a great approach. But I think in either case, you would continue giving systematically and the Lord will certainly honor that. I appreciate your call today, Tyler. I hope you guys find your new church home quickly.

Hi Deborah, how can I help you? Yeah, I am fully retired. I really don't have any expenses, as my husband takes care of all that, so I have a pretty good lifestyle. I have a long-term investment in bank stock, which is doing very well.

I don't plan on touching that for a very long time. And I have savings and a short term that takes care of anything that I might need for the next couple years. I just received $20,000 back from an investment that I had, and with the market being as volatile as it is right now, I really don't know where I want to put that. Yes.

Yeah. So are you looking for kind of investment ideas or where to allocate that from a category standpoint? What's your main question at this point? Yeah, should I put it, like, into bonds? I could buy more bank stock, which is doing really well, but my investment guy said that I'm putting all my eggs in one basket, but this particular bank stock does really well. I'm just not real happy. I mean, I just feel the market's kind of scary right now. Sure.

Well, one thing you could do, you wouldn't be able to use the whole amount, but you could put in $10,000 of it. Are you familiar with I bonds? No. Well, I've heard of them before.

Yeah. So essentially, these are what are called inflation bonds. So they're pegged to inflation. Right now, they're paying a little more than 7%, and it's guaranteed by the U.S. government. You can only put in $10,000 a year. You can get $15,000 in if you put an additional $5,000 as a part of a tax refund. But you've got to hold it at least a year, and if you take it out in less than five years, you'd have a penalty of three months' worth of interest.

But given that it's backed by the full faith and credit of the United States government and given that it's right now with inflation elevated, paying more than 7%, essentially guaranteed, you're not going to find that anywhere else. So I think that could be a great option for you. Again, I bonds are what they're called, and you could get more information at treasurydirect.gov.

That's the government's website for the U.S. Treasury where you can buy electronic bonds, and you could just read up on I bonds. I think that would be a great approach for you. Beyond that, I think you could invest in just a broad diversified index fund where you're just taking a broad view of the market. And as long as you have a long time horizon, the choppiness of the market in the near term wouldn't be of concern to me. Let me just finish by saying, Deborah, even though that bank stock has done well, I would be a little concerned about you being so highly concentrated as your advisor mentioned. It may have done great, but if the financial sector becomes out of favor or that particular bank has a challenging quarter or a problem, you could see a real steep decline in a short period of time by not being diversified. So I'm not telling you what to do.

You need to make this call, but I would give prayerful consideration to diversifying if you're too highly concentrated. Hopefully that helps you. We appreciate your call today. Thanks for listening.

WGNR Rob's in Indiana. You're going to be our final caller today. Rob, how can I help? Hey, Rob. Can you hear me okay? Yes, sir. Go right ahead.

Hey, Rob. The question I got for you is I'm coming up, I have a 20-year term life insurance policy that's coming up, you know, this year where it's, you know, I wouldn't say expiring, but you know what I'm saying? Like I've used the term up. Okay. And currently both me and my wife, we're in our mid fifties and my wife is going to be probably retiring in the next probably I'm guessing two to three years.

I've got about another four to five. So, you know, we've been in our sixties, just paid off our house, no car loans. So, we really don't have any debt. Is there a point where you say, hey, you know, I don't know if you necessarily need term life insurance, additional?

Yeah, there is a point, you know, it really isn't dependent on age. It's based on need because this is intended to offset a risk of upon the death of one family member, there being a hardship placed on another dependent, including a spouse. So, if your spouse is depending upon your income for the next four or five years and the saving that you're putting into your retirement account, which you're now unable to do at your death, then that's where that death benefit would be still important potentially.

Only you would know that. Maybe you don't need as much as you had previously because your house is paid off, but you may want to have something. And so, you could get a smaller 10-year term policy if you're healthy and it's not too expensive, where that amount would be paid to your spouse and perhaps vice versa if you're counting on her income for the next couple of years. But as soon as you reach retirement where you're no longer saving for retirement and you feel like you're essentially self-insured, then I would just drop it.

You cancel the policy and stop paying for it. But you would only know whether that's needed today or whether you need a few more years of that coverage. Does that make sense? Yeah, yeah.

I was going to say, because the only thing additional is through my work, there comes a point I'm currently pre-diabetic, so that's a concern. Yeah. And I think that's the key is making sure, number one, it's cost-effective and you may decide, you know what, we've done as much as we need and it doesn't make sense any longer.

At that point, you just let it go. We appreciate your call today, Rob. Thanks for tuning in. That's going to do it for us today.

MoneyWise Live is a partnership between Moody Radio and MoneyWise Media. I want to say thank you to Eric Tidwell on phones, Deb Solomon producing today, Amy Rios, our engineer, Mr. Jim Henry providing research. Thank you for being here as well. Come back and join us tomorrow. We'll see you then. Bye-bye.