EP. 125 More Knowledge, More Wealth: AM 590 Radio Show

Transcript:

Announcer:

This is more knowledge, more wealth with your host, Gabriel Shahin. Gabriel is a certified financial planner and a registered investment advisor at Falcon wealth planning. This showed us not intend to provide personalized investment advice through this cast and does not represent that the services or securities discussed are suitable for any investor. Investors are advised not to rely on any information contained in the broadcast, in the process of making a full informed investment decision. More knowledge more well on am five 90. The answer now here's your host Gabriel Shahin.

Gabriel Shahin:

Good afternoon. This is Gabriel Shahin certified financial planner. Your host of more knowledge, more wealth that's on every weekend. Going over all important topics of personal finance. Our goal with you is to give you the knowledge you need to increase your wealth. Now we are proud to be on station am five 90. The answer the inland Empire's leading talk station. Now to the listener, you can always reach out to myself or any one of our colleagues here at Falcon wealth planning. Our phone number is (855) 963-2526. That's 8 5, 5 96, Falcon like the bird now a principal of Falcon wealth planning, independent register investment advisory firm. We are fee only financial planning firm that also manages money as well. But our goal is to discuss with you all the important topics to help protect you of what's out there. And also give you some advice of the things that probably you're just not aware of most people in the financial services industry focus strictly on investments.

That is it guys. And sadly, yes, that is a very important part to grow your net worth, but there are other ways to grow your net worth. I'll give you a few examples. Yes, yet again, it's important to manage money accordingly and to have professionals understanding that yes, managing money is one thing, but also look at your overall financial situation. I'll give you a few examples. Number one, it could be something as simple as your debt that have a mortgage. For example, that mortgage could be very important for you to achieve financial security. For example, if you have a mortgage at 2.75%, I don't see the real aggressive rush to pay that off. I know people are saying, yes, you should pay off debt as fast as possible. And that makes sense for a lot of people, but holy smokes, a 2.75. Let's just say you were write a check and pay off your $250,000 mortgage.

Now, could you earn more than 2.7, 5% if you took a quarter of a million dollars and invested it somewhere else over the next 30 years? I think the answer is yes. I sure hope you think you can earn more than 2.7, 5% over the next 30 years. And on top of that, you get a tax write off for it. You're still gonna have to pay property tax and insurance, but that's just one way to show. And to prove that you can increase your net worth by utilizing a mortgage and leverage. And a lot of financial professionals don't understand those concepts, or maybe selfishly saying no, don't pay it off to gimme more money to manage, but by showing you the tax benefits involving and understanding the leverage piece of it, it can be important to increase your overall net worth. Another thing that some financial professionals don't give advice for is taxes.

Well, logically they say, please consult with a tax advisor. Now here at Falcon wealth planning and here at more knowledge, more wealth. Our goal is to focus on tax planning because that's the biggest void in your situation. Even if you have a tax professional, I promise you that tax professional is most likely only meeting with you once or twice a year, preparing your taxes, not doing any planning. They just take the information and give 'em to help prepare it. Well, how much help is that? Think about this. You're gonna be meeting with your accountant in the next few months for last year, but a lot of the tax planning techniques, strategies, recommendations have to be done by December 31st. You should be met with your accountants in December or November because that's when tax planning is truly needed. But over 99% of accountants don't do tax planning.

Even though they may give advice. That's not tax planning, they're not making recommendations based on charitable contributions, investments, other types of tax, saving strategies like saving into retirement or profit sharings or any other type of mechanism. So, unfortunately you're not getting that either. Now, if that's something you need help with, if that's something you're not doing, if that's something you wanna work with us guys, we have offices all across Southern California, including the inland empire. And we would love to help you out. Our phone number is (855) 963-2526. That's 8 55 96, Falcon like the bird, or you can visit our website at Falcon wealth, planning.com. That's Falcon, wp.com for short, will we be able to answer some of these complex questions to help identify what you could do to save in taxes today and throughout retirement? Because a lot of people don't do that. And you could take advantage of a free financial assessment, which we are offering.

Guys, you can help relate this show to your specific situation, to see what you should be doing with your financials, which you should be doing with your taxes, with your investments. So on and so forth. And we do a lot more than just investment management. If anything, that's the easiest part of what we do because we are not commission based advisors. That's not who we are. That's not what we, what we do. We sell brain at our product, not like some of these other people out there that are selling products like annuities. You may have an annuities, not the end of the world, but that is a heavily commission based product. And the only reason they're offering that to you, it's an inferior product is cuz of the big commissions that are involved. And you have to think about it. If it was that great of a product, why do they have to incentivize the person selling it to you?

Five, 10 up to 20% commissions. Think about that. You put a hundred thousand dollars in this, the person selling it to you is getting a 20%, $20,000 commission potentially. Now they may say, oh, you're not paying me. The insurance company is well, yeah. Are you gonna fall for that? Like this is a nonprofit, no, you are paying the insurance company and it's paying them. This is such a screwed up industry guys that we're in. So non-transparent, that's why the movies love to blow our industry up and just make fun of the boiler rooms that are out there and all these other things. It's it's, it's just not helpful. It's not good. And sadly, you guys are the worst benefactor of that by people taking advantage of you and selling you garbage. So investments easy when you're not commission based. It's quite simple. You just choose the best investments that are out there.

It's truly quite simple. But the value comes in is where you can save money and increase your net to worth in other places. And the biggest thing we see and the biggest expense mostly people have is taxes. I'm gonna give you a few examples of how you can take advantage of tax planning. One of 'em is simple as people who are charitably inclined, whether you're tied to your church or any religious organization, or are just something that you feel really strongly about that you wanna help this gonna be something like the city of hope cancer research center, where my wife worked there for a number of years and they do amazing work. And it doesn't matter who you give the money to for charity, what you can do. For example, depending on your tax situation, it may make sense to prefund future giving. Let me give you an example.

Let's just say you have a hundred thousand dollars salary and you do a tithing normally tithing. We'll just call it 10%. You give $10,000 a year. Well, if it's the last year that you're working, you may be in a high tax bracket this year versus the following years. So if you have the assets to do it or the investments, which I'll talk about in a minute, you can prefund 2, 3, 4, 5 years of charitable giving. You can put $50,000 into a charitable giving account and get a tax write off for the $50,000 this year, which may be in a higher tax bracket. You might be in a 24% tax bracket this year. And then in future years, you'll be at a 12% tax bracket or more importantly doing standard or deductions. You may be able to save just by being tax strategic five to $10,000 in taxes because you have strategically understood the tax planning concept to save you more money.

In addition to that, if you're lucky enough to have a brokerage account, which is an investment account outside of your retirement, and you have it in stocks or investments in there that has appreciated grown and value say you invested 10,000 and it grew to 50,000 over whether it's 5, 10, 20, 30 years. So you've made a 10 X on that Mon or a five X on that money. The 10,000 grew to 50, you can donate appreciated stock to the charitable fund, to the charitable account. And you still get the write off of the 50,000, even though you only pay 10, which means you, we did paying $40,000 in capital gains tax. So you got two benefits. You got the benefit of putting money into the account. Number one. And what I mean by that is you put it in the 50,000 to get a write off of $50,000.

And then the benefit number two is you avoid it. Capital gains tax on investment. You would've had to pay the taxes on anyway, by the way, if you're just joining us, you're listening to Gabriel, Shahin certified financial planner, host of more knowledge more. We here on every weekend talking about all important topics of personal finance. And we are talking about today, just the simple concepts of tax planning and things you should take into consideration when you are trying to map out your financial goals situation and how you could legally save money on taxes. And what we see most of the time is people just do not do that because they're expecting to get that information from their financial professional and their financial professional does not do that. They always say consult with a tax advisor and your tax advisor is a tax prepared, a tax planner, which makes them normal by the way.

And just the idea is guys, there's so much that you don't know. And one of my colleagues says it perfectly. You don't know which you don't know. I mean, how, how are you supposed to know this stuff? You didn't go to school for this. Even if you have a degree in finance, who to tell you of the ever changing laws that are out there, rules that come about or opportunities that are there. Even if you learn this 5, 10, 15 years ago, it's very difficult to stay on top of it. And that's why we are here. That's why we're offering a free financial assessment where we can help relate this show to your specific situation. Folks, we typically charge for this. We are given that at no cost, feel free to give us a con we're not just gonna go over investments, tax planning. We'll go over cashflow analysis, retirement planning.

When to take social security insurance estate planning, folks, you name it. Anything that involves a dollar sign. We'll give you one to two hours, one to two meetings of our time. Just give us a call. We'll be more than happy to help. Our phone number is (855) 963-2526 that's 8, 5 96, Falcon like the bird or visit our website at Falcon wealth, planning.com. That's Falcon wp.com. For short, we'll help you put together a personal financial assessment and we will give you recommendations on the spot. No cost add on. Now, if you wanna work with us, we have separate costs for that, but it really just depends on situation and the complexity, but the goal is we'll give you exactly what you need. We're not gonna withhold information to say, unless you hire us, then we'll give it to you. That's not how we operate. So folks just understanding there are difference between investment advisor and a financial planner.

And by the way, in our industry, they can call themselves whatever they want. My favorite is a vice president. They're always a senior vice president of what? Exactly nothing. It's just a title. Cuz our industry doesn't regulate the titles. They give themself. God bless these individuals, but that's just the reality of it. So who cares of their title? People are always gonna call you have people selling insurance products at New York life. That's called themselves financial advisors. And all they do is sell insurer for heaven sakes. But this is just the reality of our industry. And it's just knowing that you have to be aware, you have to be your own advocate. You need a partner to do this. You shouldn't do it alone. It's as simple as that. And yet we do see people doing it alone all day long. Are there individuals that can do it on their own?

Sure, but those are like the same individuals that don't need a mechanic on their car. Most individuals need a mechanic for their car and it's probably good to get a second pair of eyes every so often, which is why we're offering this free financial assessment phone number (855) 963-2526. That's eight I 5 96 Falcon like the bird folks. We're gonna come back. We're gonna take a short break and we're gonna go over more important concepts that can help save you some money. Stay with us folks. We'll be back in just a few words. This is Gabriel Shahin, certified financial planner. Your host of more knowledge, more wealth that's on every weekend covering all important topics, a personal finance. We're going over retirement planning, making sure you're prepared for retirement, social security and strategies, real estate taxes, avoiding them now and in the future investments, reducing fees, commissions, and so on insurance and estate planning folks, we are offering a free financial assessment that you could take advantage of. We have offices all across Southern California include looting the inlet empire. Give us a call to take advantage to $500. Offer our phone number is (855) 963-2526 that's 8 5 5 96. Falcon like the bird or visit our website, Falcon wealth planning.com. That's Falcon wp.com for short, enjoy the show we look forward to serving you

Announcer:

Am five 90. The answer,

Gabriel Shahin:

Welcome back folks. This is Gabriel Shahin certified financial planner. Your host of more knowledge, more wealth here on every weekend. We are going over all important topics of personal finance. And we are coming back from our break to look at really the benefits and things you should take a look at in your personal financial situation. Now focusing on some of the recommendations is taking a look at some charitable, not everybody is charitable folks, so you can't just focus on charity, but that sometimes is a low hanging fruit for somebody who is who we made recommendation about putting your money into it, charitable account, which you can get the write off for avoiding capital gains on some of your investments. And also for past years, putting money away, you know, all of them in year one that could cover the benefits that you do for year two, three, and four.

So if you give 10,000 a year, you could put 50,000 into an account. Get the write off in this here, cuz that might be a high tax here for you or something. And so there are just multiple things you can do, but yet again, not everything is for charity. I would like to focus though on other strategies available that may be opportunistic for you. And that is for tax loss harvesting. Now this made a lot of sense during COVID a few years back taking a look at what you potentially could do when markets drop. Now, hopefully what you're not doing is selling because as you see people who freak out overreact, super emotional individuals make mistakes. Now, by the way, I could have just stop there. Forget investments in general, the mistakes you make with family, friends relationships is you overreact and get overly sensitive and emotional.

And from an investment point of view, that means you sell an excuse me for saying, but like a fool you sell because the problem is people are, are smart and they are logical and the stock market is not logical. And when you act upon yourself and you make a change that is incorrect, you are screwing things up for multiple individuals for multiple places. And we see that happening a lot. So we wanna be very clear and say, when markets drop, it's not smart to go to cash. You may think you're smart, but not at a 10 times or more. The markets end up rebounding faster than ever. And because our market are, is in a capital market, the markets always go up. As long as we believe that you go to work for a paycheck or you work. And for a company that's goal is to make money.

Okay? We're not talking about the government here. That almost seems like they're working to lose money or to print money or to spend money. We're talking about public companies. We're talking about any company, private companies, their intention is to make money. And if, as long as you go to work, because you go for a paycheck, which is a majority of people out there. And even if they say they love their job and we do it for free, try it, try to get paid nothing and see if you can survive. So you get where I'm going with. This markets only go up. You have to believe that you have to understand that it's not a belief, oh, let's have this false belief. It's the reality. And so, as long as you believe that the stock market always over time goes up and I don't care if you're retiring in 2, 3, 5, 10 years, him now, who cares?

Because even if you retire, God willing, you still have 30, 40, 50 plus years ahead of you. And we know that markets are going to go up over that period. For the simple reason is people's goal is to make money. It's as simple as that it's been happening since the Dawn of time is the goal is to Excel to move forward. We walk forward, we don't walk backwards. So the reason I bring that up is when the markets drop where people, hopefully not like you freak out and sell. The reality is there could be opportunities available to you where you could take advantage of some, some tax planning. Some of it could be as simple as when the market you're holding. Let's just say drop 40% in value. So you had a hundred thousand dollars drop 40% to 60,000 is to take advantage of the loss. Now, what does that mean?

Exactly? This is where it gets a little silly, cuz I just said don't sell. But in this case, if you sell your S and P 500 fund that you have at fidelity, you can buy a similar fund with call it the S and P 500 similar fund at Vanguard. So why would you do that? It's still the same thing in essence, you're selling and buying. But what you did is you captured a $40,000 losses on your taxes. You get to write that off against your ordinary income. That is huge. And it also offsets future gains. If you're looking to liquidate the account part of the account, that is extremely important concept. A lot of people don't do this strategy is called tax all harvesting. The reason it's extremely important is because you're writing off at ordinary income rates. Well, if you're in the 24% tax bracket, you get back on every $10,000, $2,400 in tax savings.

Okay? When you go to resell it, you're paying in the 15% capital gains. Long term is at a higher capital gains is at a lower rate than your normal higher ordinary income tax bracket. So it's only at a 15% cent. So what does that mean when you sell it and you write it off, you get 2,400 when you, and then when you sell it later, you actually only pay 1500 you're ahead. 900 bucks. Okay. That's important. You're head 900 bucks for really nothing just because you're a tax strategic. Okay. It's very important that you take, take advantage of these strategies. Now, by the way, if you're just joining us, you're listening to Gabriel, Shahin certified financial planner here, your host of more knowledge, more wealth here on every weekend, going over all important topics of personal finance. And today I was just explaining to you the concept of tax house harvesting.

He now can make sense because when you write something off for a loss, you write it off against your ordinary income, which is always a higher bracket. Then long term capital gains rates, which in this example, 24% versus 15. So it's just very important to take advantage of these strategies. I notice a lot of people do not. Then that's just sadly, a very normal thing. They don't care to. They don't know to it's tiresome for them. Eh, what's a thousand dollars tax benefit. It's not a big deal. I don't have the time I, I value my time more. I don't wanna do this in the middle vacation or busy work week or with family. Okay. But if you do that a thousand dollars, for example, on an annual basis, over the next 10 years, that's $10,000. If you do it over the next 30 years, that's $30,000.

What's the cumulative compounding savings that could be over the 30 years. I'll take it a step forward. That's on a $10,000 count. What if you have a hundred thousand dollars count, you get where I'm going with this. Sometimes people say it's very expensive to hire a professional. You know what I say? I think it's expensive to be an amateur. I think sometimes you can't afford to be cheap because you'll realize real quick, what expensive is when you try doing it yourself. And there are just certain things I almost feel like sometimes are stream tries purposely to make it complex. Whether it's through the ultimate, the, the multiple investment options out there, the tax situation that you have to encounter with these investments, because not all two investments are same. You could have two. What seems like a bond fund. Some that are qualified dividends and some that are ordinary divide, two different taxation.

So you may go with the one that pays higher. When in reality, you should pay for the one that's a little lower because it's more tax favorable. It could be tax free to you. And so there's, these are the things that just you weren't taught. You wouldn't know how would you know, are you, you gonna read that big, thick prospectus that comes to you? Probably not heck I'm in the investment professional industry. And I don't even read those prospects. Are you kidding me? You know, how many are out there? It's ridiculous. And yet again, this is sadly the reality folks. If you need help with this, if you just wanna see what makes sense for your situation, based on the stuff that you app, we are offering a proof financial assessment that we will help put together. Something for you to tell you, these are the things that you should do.

Okay? And it won't be just on investments and tax, but everything that involves a dollar sign, any questions that you have folks give us a call. Our phone number's (855) 963-2526, that's 5, 5 96, Falcon like the bird, or visit our website at Falcon wealth, planning.com. That's Falcon, wp.com for short. And you can take a look at our site and see all the services that we do and how we can help and grow folks. We grow ridiculously through word of mouth. There's very few honest people out there in the industry, and we're one of those. So we would love to help you show you cast the big net out there. What could help you, whether you hire us or not, because you may know somebody that can help us. And for all, you know, we may be able to show you a plan that could save you thousands, tens of thousands, if not hundreds of thousands throughout your lifetime.

And at that point, it's a no brainer. And like I said, one of my colleagues say, you don't know what you don't know. And at the very least you're learning, you're educating. That's really who we are as, as, as a firm, as a heart of a teacher. And I think it's a very important concept to try to take advantage of things that could make sense for you guys at the end of the day has to make sense. Okay? If you're gonna spend money on a new car, you have to see value from that new car. Some people spend a little bit more on a hybrid vehicle. Why? Well, if you're driving 20,000 miles a year, then who cares? If you spend an extra five grand, cuz you went from 30 miles, a gallon to 60 miles, a gallon, you get where I'm saying like you, the break even might be a year and a half.

So there are things you just have to run the analysis on. And folks we can help with at that. This is what we do on a daily basis. This is our profession. We are aware of all the, the rules, the, the loopholes, if you will, the, the ways that could help address and enhance your financial situation. I, I hate to say it that way, but it's the reality. We do this every single day. And if you want to help with that, if you wanna help to relate this show to your specific situation, please reach out, give us a call. We'll be more than happy to help. We have offices all across Southern California, including the inland empire. Our phone number is (855) 963-2526. That's eight I 5 96, Falcon like the bird we go over all important topics of personal finance and we will help customize to your situation.

We have helped thousands of people, folks manageable, half a billion dollars of assets. And we are proud to say that we've seen multiple things that come across and because we're true comprehensive planners, we can add significant value folks. This is the beginning of the year. This could be the best time to make these type of choices, especially since you're about to do your taxes come and March in April, we would love to help you out. Folks give us a call. We'd love to help. Okay. That was a fast, fast show. As we close out. I want to thank you guys for joining me this weekend. You can always reach out to myself or any one of our colleagues at Falcon wealth planning at 8 5 5 9 6 3 25 26 that's 8 5, 5 96, Falcon like the bird or visit our what upside@falconwealthplanning.com. That's Falcon wp.com for sure. Call us, we'll have a personal confidential conversation about your specific situation. Answer the questions you may have tune in every Saturday from 1230 to one o'clock as we go over all important topics of personal finance and where our goal is to give you the knowledge you need to increase your wealth. I wanna thank you for listening. I want you to enjoy your afternoon. Enjoy your weekend. Have a great week. And God bless.