I'm 54 and my wife and I are VERY worried about our future, gas and food prices rising daily. We have had our savings dwindle with the cost of living into the stratosphere, and we are finding it impossible to replace them. We can get by, but can't seem to get ahead. My condolences to anyone retiring in this crisis, 30 years nonstop just for a crooked system to take all you worked for.
I feel your pain mate, as a fellow retiree, I’d suggest you look into passive index fund investing and learn some more. For me, I had my share of ups and downs when I first started looking for a consistent passive income so I hired an expert advisor for aid, and following her advice, I poured $30k in value stocks and digital assets, Up to 200k so far and pretty sure I'm ready for whatever comes.
@@YvonneFranken The crazy part is that those advisors are probably outperforming the market and raising good returns but some are charging fees over fees that drain your portfolio. Is this the case with yours too?
40 now, and everything is paid for. Fortunately, I had a college economics teacher who taught me a lesson when I was 18 years old. That lesson was: you can't buy something else for every purchase you make. Having multiple sources of income is prudent, as is living within your means. I have a 13-year-old vehicle because it is all I need, I like it, and I can do whatever I want with it. My net worth is $4 million, and I can pay my bills without stress, but I don't live like I have that. I have no complaints.
I fully agree; I'm 56 years old and recently retired with approximately 1.2 million in outside retirement funds, no debt, and very few dollars in retirement funds in comparison to my portfolio balance over the last three years. To be honest, the financial advisor's role can only be ignored, not dismissed. Therefore do your research to get a reputable one and that should be any individuals main route into the market.
Yes, I'm in my mid-50s, and a few years back, I moved my investments to my wife's wealth manager. While I haven't caught up to her long-term gains, my current earnings and the growth of my retirement fund, compared to just relying on the 401(k), are pretty satisfying.
Thanks, I just Googled her name and her website came up right away. It looks interesting so far. I'm going to book a call with her and let you know how it goes.
A letter to Azul...............I'm 61 and after 40 years of going every day at 110%, I'm eyeballing that the end is near. Of all the videos I watch like this, your content gives me the best answers and ideas I need, Thank you. My hard work and buying that old, used car, instead of the new one, has paid off. I believe I'm financially secure to retire now (literally, right now). I don't have big worldly travel plans (my wife does :)) that will chew up a lot of capital, but there are things I want and need to do while I still have my health, so, looking at retiring a little early. Working on a plan to "bridge" the gap to 65 for Medicare now. Once that's set, I'm going to hold my breath, and, after 40+ years, stop getting up at 5am for work! It's going to feel very strange (especially because I've taken very little vacation over those 40 years) , but, good! Thank Azul!
You may consider a 'retirement dry run' as Azul has recommended in other videos. Going all out for 40 years means just stopping and going full time retirement cold turkey may be a difficult transition.
Azul, watch out with the blanket statement that growth stocks outperform over the long haul. As a mutual fund portfolio manager (I was ranked top 5%tile) you generally see value stocks outperform for long periods and then growth stocks outperform for long periods. Long cycle periods. Schv or SCHg type holdings. I love your dividend approach. One fund I ran was an income fund. FI and quality equity dividend payers mix in one fund. Equity side was Similar to the etfs: qdf,dgro,dgrw,nobl,vig,schd. These are great ways to invest without the cost of a money manager. Low cost = more for the investor and you don’t need to worry about the individual holdings. Love what you are passing on in these videos. Keep up the love and knowledge.
No! The 2nd home ALSO violates your worry free goal, in addition to your one home rule. Rental properties are not for retirees. Nope. Too complicated and the expenses are too variable.
My guess is the 2 home strategy is only for a portion of early retirement. He’s young still, lots of energy left, maybe has a family member or close friend on location to take care of the place while he’s gone, then when he’s tired of skiing, sell that home or give it to the kids. It’s also a good way to stay diversified if stocks take a long hard hit.
Both actually. Some prefer to live in a house but I am lucky to have a large central urban condo at a perfect spot for home. As for rental apartments, they are much easier to manage - and I also believe the value is more stable and predictable than for houses. @@meterreaderpdx
Azul, you surprised me. I expected that you would say stick with a 3 bucket strategy or something. I am following the dividend paying stocks strategy for myself but I had a good model. I got that from my father who set up their investments for my mother that way. She lived 22 years after he died never sold a single share just lived comfortably off SS and dividends. She traveled all over, never had to give up her house or car, didn't want for anything and passed away with more than they started with 22 years before.
Thank you so much for your videos. I’m 50 and honestly never even thought about all the issues you raise in retirement but you’ve definitely changed so much of how I was approaching this issue. Keep those videos coming and also appreciate some of the recurring themes as well- sometimes people like me need to hear things 3-4 times for them to sink in!
Good stuff Azul. We are savers/investors and I have always directed this on my own since we were 25. I just followed the writings of Buffett and Bogle, and dollar-cost-averaged into index funds for 40 years no matter what the market was doing. Never selling before retirement out of fear. The down market always recovers over time and we had plenty of time. This simple strategy has worked pretty well for us and we sleep well at night.
Nice video. I fully retired FIRE at 55. I follow my stocks every single day not because I'm worry, I enjoy it. Investing to me is my hobby. Ive been very successful and it gives me something to do during the day. In the afternoon, my wife and I go out and play.
Thanks for watching and commenting. Glad you are enjoying your 55 year old FIRE retirement. Well done. Word of caution. Two most expensive hobbies in the world are: 1) House shopping "just for fun" 2) Watching your investments every day The risk is when things get scary. How often you watch your stocks is a significant risk factor for people who blow out of the stocks in scary times. Azul
@@AzulWells thank you for your advice. I’m a long term investor and I rarely sell unless the fundamentals of a stock is declining. If a stock I own dips and I believe it’s due to external factors, I’ll buy more. Otherwise, I never sell the chicken that lays the egg, dividends. Take care and love your videos.
I always find it interesting how people are defined by their jobs. I'm a doctor Iawyer a teacher no identity beyond their work. I was never defined by my work. It was a job. When I told the regional manager I was retiring she asks do you know how much money you make! Yes I do but as Azul says I'm not going to live forever. Retirement has been great. Drives my A personality wife crazy though
Great vid. 59 and recently retired. Getting a Financial Advisor best decision we ever made. We also now have our Estate Planning set up thanks thanks to our FA.
Could you do a video on how a fee only financial advisor works? I have a meeting scheduled with one but they also manage clients accounts. Super confused with this.
Agreed with everything you said except delaying taking social security. I believe you should take is as soon as you are eligible to receive it and no longer plan on working. I believe this for two reasons - 1) If you do a present worth analysis of taking smaller payments at 62, larger ones at 65, and 69 you will see that the present worth is the same for all three scenarios so there is no advantage to waiting and getting a larger monthly payment. 2) You are going to need money to live on, take the social security versus taking money out of tax deferred accounts. Just my two cents.
If you have a family history of longevity, it can be good to delay SS and burn down your tax deferred savings before SS kicks in. Then you have 40% bigger indexed income and a lower average tax.
Azul, don’t take for granted that your senior kids, even though they’re doing well, won’t seriously ‘benefit’ from some extra cash when they are retirement age. My mother passed at 93 and her estate provided some real breathing room for me even though I’m successful.
Thank you for the video, I have already retired with a sizable savings. I am having a terrible time finding a good advisor, all I hear is put all you money in an annuity and give me a big commission.
Azul, great video. You are a ray of sunshine. I think you should consider interviewing people with strong game plans. Investing always has a individual component, so what works for Azul is slightly different than what works for me. This would add additional food for thought for your viewers. There are the general common themes that are common among all good investors and these would also shine through. Thanks for sharing. I really enjoy your upbeat attitude. RUclips, the internet can be such a great place for people to interact in a positive way. Your videos are a poster child for positive internet content.
What software do you use to track dividend paying stocks 1) dividend growth and 2) growth of the capital ? How do I 1)monitor dividend growth and also 2) monitor capital appreciation, with me spending the dividends. How much do I need to save to reinvest as I spend the dividends to live off of.
Azul, understanding this vidis almost a year old but keep in mind the idea of renting out one house will become a full-time job, take it from someone who has done it. Airbnb nonsense or the cost of property management.. as the saying goes just because you can do something doesn't mean you should...move to a warmer climate and then go to ski for your holidays. All the best!
Thanks for sharing! 👍 One point: Stress and worry wise, the two home strategy with a rental component is 2x worse than a two home strategy without, which you correctly vetoed. Sounds like wishful thinking. I would stick to one home and rent the other for 6 months (and one day 😉). Predictable costs that you can budget for, then walk away and SLEEP well.
Hello Azul, I really love all your videos and all the valuable information that you share with us. I am 62 years old and am thinking and planning my retirement soon from VCU Medical Center in Richmond, VA after working here for about 32 years. Your videos definitely helped me gauge where I am in the picture of average American. By the way, I have a question: I know you like to take the video while you are walking, where are the places that you walk? Some of the places look really great and one day, I would like to visit some of those places. Thank you again for all you do for all of us! June Lee
A really great video. Thanks for putting it together. It gives me some peace of mind knowing that my personal strategy is very similar to yours. I too am 59 and I'm shooting to retire at 62. So far, my fee only financial advisor says that I am green lighted for that goal. And I have 60% of my portfolio in dividend stocks. Those dividends along with a small pension and along with social security at age 65 should provide the needed cashflow. Again, thanks for the great content!
60% in dividend paying stock is vague. Are you in ETFs, index funds or individual stocks? You're the man if it only takes you 4 hours a quarter tó track individual stocks. It takes me 4 hours to analyze one 10-Q report.
Great video and great content. You (Azul) do a great job with the information provided and never try to push an agenda. I love watching your videos. I'm 46 and hoping to retire around 55. I feel we are in a good place financially and love watching your videos to help me prepare for the next decade. I'd love to see a video that talks about how to plan for the gap between drawing from retirement funds, social security and healthcare if you retire earlier than 62+. Thanks for all you do and you are truly leaving a positive mark on the world by helping others through these videos.
I'm very similar to your situation. Hoping to retire at 55. My plan is to sell the house, use that proceeds to travel abroad (where cost of living and healthcare will be cheap) come back to US when we are 60ish and then collect social security at 62. By selling the house and traveling abroad that would allow us to NOT touch the retirement funds (they should actually be growing) until we come back to the US
Like you, I have always focused on investing in high quality dividend paying stocks. At the same time, I look for companies that have a history of raising their dividends year after year. This makes a huge difference in total return. Have a Happy New Year!
Azul Thanks-for your down to earth practical advice! The only comment I would have is that you say at a certain age unfortunately we only have 1000 weeks left … I prefer to think FORTUNATELY I have X weeks left (I’m 69)
I want to understand your 60/40 portfolio vs your net worth. My stock/bond portfolio is 90/10, but also 40/60 if I calculate my 40% stocks vs. my 60% other net worth assets, like my real estate.
More and more people might face a tough time in retirement. Low-paying jobs, inflation, and high rents make it hard to save. Now, middle-class Americans find it tough to own a home too, leaving them without a place to retire.
The increasing prices have impacted my plan to retire at 62, work part-time, and save for the future. I'm concerned about whether those who navigated the 2008 financial crisis had an easier time than I am currently experiencing. The combination of stock market volatility and a decrease in income is causing anxiety about whether I'll have sufficient funds for retirement.
This is precisely why I like having a portfolio coach guide my day-to-day market decisions: with their extensive knowledge of going long and short at the same time, using risk for its asymmetrical upside and laying it off as a hedge against the inevitable downward turns, their skillset makes it nearly impossible for them to underperform. I've been utilizing a portfolio coach for more than two years, and I've made over $800,000
'Carol Vivian Constable, a highly respected figure in her field. I suggest delving deeper into her credentials, as she possesses extensive experience and serves as a valuable resource for individuals seeking guidance in navigating the financial market.
I've watched quite a few of your videos. You've convinced me that I'm ready to retire now (should have done it earlier). Don't want to waste anymore of my 1,000 good weeks I have left. Your gameplan sounds solid and I'm going to mirror it. Thank you and hope you have a long and happy life.
He has a high opinion of his stock and bond picker… If he doesn’t care to beat the index, then he should just buy a single ETF or maybe two and save the one percent that he is going to give the planner, heck with that savings he could even go more conservative as you suggest at 50 50 instead of 60 40
Please explain what is a "fee only" advisor? Is this a 1% fee of your investment to the advisor? Or is it a one time fee when you sit down with them? I am guessing it is a flat fee not a fee on what your investments make??
This is typically a flat fee as a percentage of your assets being managed. 1% fee of a million dollar portfolio translates to $10,000 each year in fees.
@@Rottingboards The advisor will manage whatever money you direct to them and invest it on your behalf based on your risk tolerance and time horizon. Most likely their returns won’t beat the market average, especially when factoring in the fees.
@@BarbellFinancial I wouldn't expect them to beat the market average since it is a retirement account and they are trying to play it somewhat safe. Thanks so much for your responses.
@@lifestream4191 Yup I studied those things. For example I made sure to have Social Security at level Max - 200 USD. Or to have ton of Roth money etc etc.
I think the 2 house situation is fine if you have one that is the final “age in place” property(meaning access if in a wheelchair). We downsized to a townhouse with an elevator and a private garage at 2000sf from over 4000sf. The renting situation will work till it won’t. We also own a boat, a ski timeshare we love, plan on an RV for a while. No debt, in FL. Have relatives and friends in nice states we can visit. Recently retired in early 60’s from jobs we liked. As to just looking at your portfolio once a quarter, I get it, but not my nature. I spent 2 years researching retirement, and am pretty certain I have a sustainable plan at this point, having considered multiple contingencies. It basically is, no debt, while creating base cash flow that keeps us solvent no matter what, and then everything else is discretionary spending. So even if the discretionary part drops 70%, we will still have “cheaper” fun. I even created 3 budgets, that I call Base, Moderate, and High. Started on the High, and even the Base has some fun money, so we can survive a major recession with no problem. BTW our Base Budget is well under$100k, so we are not “rich”
Great Video --- I'm 59 (retired 1.5 yrs ago at 57). I'm lucky enough to have invested at the onset in my career (actually - first stock I bought was at Age 14 - DeTomaso - my dad needed to be on the account - though UGMA I believe). I'm a 60/40 split and it has worked well. I did all my own investments until 20 yrs ago - then had a professional take over. Which was good - since I was 100% stock. I use my cousin's financial advisor (they did well with him). I didn't want to - I always did my own and actually it was my 2nd career choice (I went into IT - wished I took my 2nd choice). HOWEVER - they know how to minimize risk and know tax laws which has helped me greatly over the years. I do have ONE issue - I spend 30 minutes a day on investments - I have to stop looking at it - since I do add'l investing on the side (not trading) with funds left over from my distribution. My issue is healthcare - I have it through ACA - my plan is not qualified for a HSA. I HOPE to have my deductible ($8700/yr) fully funded by Feb. 2024 (approx $45k) until I can get medicare in a separate acct. THEN - all unused deductible amounts each year will be used to purchase a "new' car (I have a 2008 Pontiac Grand Prix - only 66k miles and in very good shape) by the time I'm 64 (I was born on Leap Year - so it will be my 16th b-day). Thanks again for all you do!
You have given me pause. You are likely right. One of those things that sound good in my dreams, but not so much in practice. I’ll keep you posted. Thanks for taking the time to share your “voice of experience” with me and the community. 😎 Azul
@@AzulWells just trying to save you the sleepless nights we endured. But we DID finally sell that second home, barely breaking even after the expenses of maintaining it. I DO LOVE your advice and the way you present it. Signed, Out of Debt and Financially Secure. 😉
I think the two house situation will work, if one is the house you ultimately settle in and is adequate for “aging in place”. A lot of people forget that as you get older stairs and shower access and such become a problem. We downsized to a 2000sf townhouse with an elevator. We also have a boat(for now) plan on a used RV, have had a timeshare we love for 20years, and have friends and family in different states that we visit, when it’s Summer in FL. No debt btw, and recently retired in early 60’s from jobs we liked.
Please put some example numbers on the screen on what a fee only advisor should be getting. If I have over a million dollars and my fee is 1% is that too much of a fee? What should they be doing for me?
I have been taking care of my main tax deferred portfolio until recently I handed it over to my financial advisor. He had been taking care of a smaller account and was charging a 1% fee on the portfolio. He offered to only charge me 0.7% for the combined portfolios. They go over my investments annually but I can call them at anytime to discuss any changes I may want to make or any questions about finance or what the markets are doing.
I trust Azul I think he has his viewers best interest at heart. This is a great video. Hoping for a video for people like me forced to retire earlier than planned at 59 with under 2 million. Can retirement be successful ?
Great video. Your goals and approach are spot on. Really resonates. No worry is my #1 goal as well and it serves me well. One spouse and one house also great advice. I am 50 years happily with my one and only spouse. We joke that the only way out is in a wooden box. We did the two house thing early on with a vacation home on a lake and the house in the city. Much better to rent when / if you need a second place. We have a house with a big pool in the city but beside a river. So miles of nature trails and view of a forest in the heart of a city. We actually don't need a lot of adventure. I have no investment advice. Just set it up so you don't have risk or worry. We have agreed that when one of us dies the other will buy a big enough annuity to meet all expenses for life. Then we'll not get scammed when we have dementia. Our wills leave everything to a good cause. No one will know or care that we passed other than a nice organization will have a happy surprise.
Hi. Love these videos. Is there anyway you can block these shill commenters who give names out for financial advisers? I notice a lot of them on your site and am afraid some people may not recognize them for what they are.
No I watch Squalk Box every morning. I use that information and balance my portfolio. I do snag some T-bills a few months ago when it hit over 5% (short term) and purchased some nice dividend stocks that pay well will low risk in known buissness. Sorry I watch my portfolio about 20 minutes a day. I sleep well. I have maintained my balance since retirement and have traveled a lot of the world. Oh most "normal people" do not have 5000 sq feet homes, more like 1900 sq feet so you are a different catagory
Here is my contrarian's opinion which is based on my own experience. I retired in 2020 at the beginning of the pandemic. I was 65 years old and the time and was eligible to pull out my pension out which was based on two "chunks", One chunk was a lump sum which most of it was IRA rollover and the other one is a monthly pay. Both "chunks" were, let's say, very generous. I rolled it over to an account at Fidelity, assigned the account to a very reputable Atlanta fiduciary firm and told them that I'm looking for a conservative investment which was mainly to keep the value of the money and receive some annual dividend. At the time, I really didn't need the money. My monthly pension income was good, my wife was working and still is, and at the time, we had seven rental houses that brought in a good chunk of money as well. However, after two years watching my Fidelity account stagnant and practically losing money to inflation, (About $40K in two years), I requested our accountant to do an analysis as to how much taxes I would have to pay if I pulled out that money out. My goal was to invest that money in another rental property. The accountant came back with a reasonable amount, I pulled out that money and added another house to out "Stable". We bought that house cash so aside from the usual expenses (Upkeep, taxes insurance, management) we don't have many expenses. and the rent is great. My advise, especially to young people, invest in income real estate instead of stock, bonds, etc. Sure, for in long run you would probably make more money in stocks, but the equity in real estate, like in stocks, from a retiree perspective is meaningless. What is important, is the monthly income it generates. Real estate also have lots of tax benefits and if you cannot afford to buy real estate were you live, buy where you can afford. This is a vast country, and there is always demand for rental everywhere. Buy small, and let the tenant pay your expenses, whenever you can afford, buy more and by the time you retire, you'd be sitting on mortgage-free properties with a great income hedging against inflation.
I was a landlord for 13 years (we lived in the same house with the tenants) my husband got fed up with the tenants so we sold it 20 years ago. I’m supposed to be inheriting a house from my mom which is in NYC in an outer borough and I am debating whether to keep that house and rent it out or sell it. Rental mkt is good unless you get a bad tenant. Then you have problems.
@@jdenino6022 First, a rule of thumb, never landlord yourself if you can afford it. When I started investing in real estate about 15 years ago, all the properties I bought back then, were out of state. At the time, I lived in California and investing there did not make sense and was unfavorable. Second, if you inherit a house free and clear and you are not require to pay any "Death tax" as they call it, I'd say update the house to the best of your ability. The house that I bought in exchange for my IRA, was an inheritance. That house was owned by the seller's father. On top of the selling price, I had to spend about $50K to bring it up to a rental standard. Usually houses that are owned by retirees for with limited income, and for a long time, are mostly neglected and need some work. Doesn't mean you'd need to spend as much as I did, but it will need some work. In these times, it will be easier to rent out than sell. Find a reputable property manager and so you won't have to deal with the day by day operation, and you'll find soon enough that having that income is wonderful.
My wife and I own five rental properties, no mortgages. The rental income will be more than enough to meet our retirement needs which will be in ten years when my wife retires. We also have a Dividend portfolio which will be used to buy more rental properties during retirement at 50% down. I love property investment. I got hooked on it after our landlord unfairly evicted us 14 years ago.
Tracking my investments is one of my favorite hobbies. Maybe I'm weird? Okay, definitely. But financial news following is fun! I think it gives you a more balanced view of the going on in the world? You can't afford to be heavily biased on any one political philosophy, because the market is ultimately objective?
Ive been a high risk (technology) investor. Ive done better than any advisor i used. I can live on SS and small pensions. Im worried about my daughters lack of financial interests when she inherits it. I need a fee only advisor setup for when i croak
It's the first time I have heard anybody talking about using HSA for long term care. Paying medical expenses yes, but not long-term care. I think that would get people more interested in holding on to them during their earning years (when the opportunity presents itself). Maybe you can even do a video on HSA strategies, etc.
I would like to think living off dividends is possible, but I recieved a wake up call last year with AT&T (T). I hold a lot of T, and was happy with it , and why not? They had raised thier dividend every year for 36 years, they were considered a bellweather stock, Dividend Aristocrat, a stock for widows and orphans, because of their dividend, which was around 7%. In 2022, the Dividend Aristocrat cut their dividend not quite in half. Surprise! Dividend cuts can and do happen, even to the "Aristocrats", because sometimes their management makes bonehead decisions they can't recover from. 😬
I feel your pain. ATT stock is less than half its peak value. My lesson was from ATT. My dad’s lesson was from GE. Don’t chase dividends, just invest in good value stocks like BRK-B or index funds and plan on selling some shares on an as needed basis to fund retirement.
Very nice breakdown. Its unexpected and unnecessary but thanks for the transparency and openness about your real-life plans rather than academic theory.
I wish I had the confidence in being able to find a financial advisor that could make safe recommendations that you do but I've never found one. Ever. I have more confidence in the discipline of Berkshire Hathaway or just holding the S&P than any advisor. So I'll just diversify, diversify, diversify and pray. Thanks for the video. Great advise. Especially helping your kids when it will have the most impact! That is fantastic advice.
I'm doing all the things Azul is. 1 House 1 Spouse! Except this is spouse 2! But I ditched the first one when I was 30 so lesson learned. No mortgage. Have 401K 100% stocks but about 20% of that is in a Vanguard high dividend yield fund. S&P 500 is 35%. Have a pension. Have an HSA. Not thinking I'll get Social Security as by the time I take it I'll be means tested out of it. Despite having paid the max for most of my adult life. I got about 10 more years that I need to work. My question is, when should I start migrating 20-30% of my portfolio into short term bonds? Inflation is a killer. Thanks!
People frequently use the term “fee only financial advisor.” I took this to mean that you pay someone a fixed dollar amount and they review your situation. I asked a relative about their “fee only…” They said that their investments are under that firm’s control and that they pay a fee based on the assets under the control of that firm. They noted that the firm has a fiduciary obligation to them. This doesn’t make sense to me. Am I missing something?
unfortunately, financial advisors try to conflate things. There are really two major competing organizations: NAPFA and NAPA. The former emphasizes the benefit of fee-only advisors vs NAPA which tend to be commission based. Fee-only means flat fee, hourly/retainer, or % fee of assets under management (AUM). Azul has done a video about what fee-only means, and makes the point firms will bias toward moving clients into a %AUM structure vice flat fee or hourly/retainer for the firm's cash. To me that is the firm looking out for its self interest not the clients, which is a bit hypocritcal when the Financial Adivsor (FA) at the firm is saying they are a fiduciary. Two things can be true at once: the FA can be a fiduciary while the firm has not such obligation. Firms generally give client an option to grant the firm full discretionary or non-discretionary trading authority. I would never sign up with a firm that mandates full discretionary if you sign up with the firm, because there isn't an exigency that should require a FA an ability to immediately trade your assets without running it by you first. If your FA is putting you in such highly volatile and risky investments which require no notice discretionary trading, I would run away quicker than the road runner. Coincidentally, the firm azul is a partner, shareholder, and adviser does not give clients the option of full discretionary or non-discretionary: the firm requires full discretionary. I also think the focus on fiduciary is misleading. There is ethical fiduciary and legal fiduciary, and again just because your FA may be acting as your fiduciary doesn't mean the firm is. Even if you ask the FA if they are fiduciary 100% of time, you need to also get it in writing the firm is, too. The problem with legal fiduciary is that it is very difficult to prove fiduciary violation. I have never heard of an investment advisory firm or FA say hey, you know what after 10 years of taking 1% AUM from you, we actually think it's in your best interest to just put you on hourly/retainer rather than %AUM, since we haven't done anything to your portfolio except withdraw your RMD and of course or 1% fee.
Great plan bro. I'll turn my asset management over to an advisor in my 70's before age related memory disorders set in. Ameriprise has some monitoring features for older at risk clients that are prone to scammers.... Renting out your home? No way... You just dont know renters.... Picture 2 dudes But-Fing on same bed you and you wife sleep on.... No way. Not worth it. KInda surprised you would go for that easy buck option. The trade off is not worth it.
You're definitely accomplishing the, "give back" goal with these video shares. Your channel has been inspiring as I move more toward sharing what I know and have experienced to help younger folks. Thank you!
Love your videos and keep up the good work. Thanks for sharing your insights, especially on the softer psychological side of retirement. I’m surprised you’re going with individual stocks. I know that you said you advisor will manage it, but it’s well known that very few money managers beat the market. Why not an ETF like SCHD or DGRO for your dividend portfolio? As for bonds, corporate bonds are often correlated with the companies that issue them. I’m surprised you aren’t using short and intermediate term treasuries.
You will get tired of the rental management pretty quick. Do not break your rules. Just do a long term rental for 3 months a year. That way you can stay in different areas and have more flexibility without insurance, tax, and repair costs.
I am about to retire at 56 and cash flow is key. I am doing a mix of dividend stocks, muni bonds, covered call funds, and high interest CD's for cash flow.
Hi Azul. Thank you for sharing this information about your personal portfolio and the reasons why. If you're looking for another video idea - I would be very interested in learning more about a) what metrics you look at when reviewing your portfolio's past performance and b) what topics you might discuss with your financial advisor during the 4 hours per quarter you spend on each.
Excellent video. Thank you. Question 1 - dividend stocks for cash flow - got it. But after you have to start taking RMDs won’t you have cash flow needs meet? Question 2 - bonds scare me. Please do some videos on bonds. Why not CDs directly or through brokerage account instead of bonds?
I have had a second home for almost 2 decades. I do Short Term Rental on it during the 7-8 months a year I am not in it. I am considering renting my primary the same way when I retire for the 4-5 months I am not in it
I own STRs and I plan to switch homes too once kids are in college. So I’m with you there. But the one potential flaw I see in your plan Azul is that one of those houses are in a ski mountain and you plan to occupy it during the ski season. I haven’t come across any good ski places that rent out well during the offseason. Tahoe is one that has a decent offseason occupancy rates and even that is only around 40% in the best of locations. To pull off what you are talking about, you either need to buy in all year round markets like Hawaii, or occupy them in offseasons that don’t overlap.
I could never own two homes and rent BOTH of them out for part of the year. Knowing other random people were living, eating, walking around my house, using the bathrooms etc....ugh....I owned a second home in a resort area for a number of years and the headaches were not worth it (emergency repairs, tenants that had to be evicted etc). Why not just own one house and rent someplace when you want to be somewhere else? My parents used to winter in Florida and rented a place (the same place) for 3 months every year to get out of the cold, snowy Northeast.
I’ve watch several of your videos and you’ve gone against what you advised, which is understandable because you more than likely in or above average group than in the median group. Thank you for your videos.
I don't qualify for an HSA, but that's a great thing! I have Tricare and if you know about that you know it's far more beneficial than HSA. We're 100% stocks today and will be during retirement. It's not for everyone, but it fits our situation. We have a military pension, a federal employee pension, and a VA disability. Add our 2 SS (not always figured in) and we'll have $130k or more in annual pension income, $180k if we had SS.
Azul... really enjoy your videos. Easy to follow and great advice. Transitioning from working to a fixed income from retirement savings can be a challenge.
Great content Azul! I'm taking notes on this one & love your long-range plans. Question, can you expand a bit more on fees charged by wealth advisors. I've had a very good one since I was in my twenties and understand they typically charge from 0.25% to 1% annually, however, I also know that the fee they charge can largely depend on the amount of money being managed- Is it true that if a person's net worth is over three million, that annual fee is negotiable and if so, can you provide some tips for leveraging the best rate. I know that ensuring they are a fiduciary firm is also key. Thank you and happy pre birthday!
I’m just signing up with one advisor and he is fee based. Meaning a flat yearly fee and he advises me setting up my funds and accounts. We went thru my current retirement funds, one thru a mainstream company and another thru a retirement fund related to my profession. He said the amount I’m paying for mutual funds, ETFs and management fees comes to $3,800 yr. Reallocating to similar but lower fee (mostly vanguard) funds and not paying the management, just the $1k to the new advisor, I could save about half that. Wish I did it years ago.
Speaking of helping kids now (when they really need it) as opposed to later (when it may be more of a "blessing"); we have been able to help all three of our girls immensely with money now; mostly in the form of paying off student loans. For this they have all been so grateful. One of my daughters has been in school her whole life, but she is almost done; she is currently taking her Ph.D in Cognitive Psychology in New Zealand. Some of her friends think she is "spoiled" because we have helped her so much, and they have commented that to her, but from our perspective why not help them? We have the means and it sure helped them. Nice to come out of a doctorate progarm with no student loan debt.
8 hours per quarter seems like a lot. I set aside an hour in the morning on the first of the month to review balances and update some spreadsheets. It's more like 30 minutes, so 1.5 to 3 hours per quarter. Maybe an extra 1-2 hours for tax filing per year. I think I've only rebalanced once or twice in the last decade after reviewing. But I'm not retired yet, just borderline ready. I'd automate any withdrawals though, so that wouldn't require extra time.
Excellent video! Two things: What is a “fee only financial advisor” ? The name implies a definition, but I just want to eliminate any possible misinterpretations. How do you find a ‘good’ financial advisor ? Please make a video that goes over how you spend your 8 hours per quarter reviewing your investments ? It would be a mechanical perspective. A proposed title: “A day in the life of Azul reviewing his investments” ;) Exactly what tools and methods do you use ? Thanks for the very informative perspectives and reflections.
The Males in my family die from ages 69 to 73 and I am 64 so The odds for a long life don't look so good, have a market account that contains 2000 shares DUKE, 2000 shares CAT, 2000 shares Exon0Moblel, and 2000 shares AEP. I get dividends to help support our life. I also have a play account for penny stocks for a hobby, sometimes I win and sometimes I lose. We are not eligible for SSI due to our work history. but get small pensions. I suspect we are lower middle class.
I'm 54 and my wife and I are VERY worried about our future, gas and food prices rising daily. We have had our savings dwindle with the cost of living into the stratosphere, and we are finding it impossible to replace them. We can get by, but can't seem to get ahead. My condolences to anyone retiring in this crisis, 30 years nonstop just for a crooked system to take all you worked for.
I feel your pain mate, as a fellow retiree, I’d suggest you look into passive index fund investing and learn some more. For me, I had my share of ups and downs when I first started looking for a consistent passive income so I hired an expert advisor for aid, and following her advice, I poured $30k in value stocks and digital assets, Up to 200k so far and pretty sure I'm ready for whatever comes.
@@YvonneFranken That's actually quite impressive, I could use some Info on your FA, I am looking to make a change on my finances this year as well
@@IbrahimIsabella-00 My advisor is *MARGARET MOLLI ALVEY*
You can look her up online
@@YvonneFranken The crazy part is that those advisors are probably outperforming the market and raising good returns but some are charging fees over fees that drain your portfolio. Is this the case with yours too?
Making money is action.
Saving money is behavior
Growing money is knowledge
Giving money is Awesome!
Great video.
(Also a retired skier!)
✌️😁
40 now, and everything is paid for. Fortunately, I had a college economics teacher who taught me a lesson when I was 18 years old. That lesson was: you can't buy something else for every purchase you make. Having multiple sources of income is prudent, as is living within your means. I have a 13-year-old vehicle because it is all I need, I like it, and I can do whatever I want with it. My net worth is $4 million, and I can pay my bills without stress, but I don't live like I have that. I have no complaints.
I fully agree; I'm 56 years old and recently retired with approximately 1.2 million in outside retirement funds, no debt, and very few dollars in retirement funds in comparison to my portfolio balance over the last three years. To be honest, the financial advisor's role can only be ignored, not dismissed. Therefore do your research to get a reputable one and that should be any individuals main route into the market.
Yes, I'm in my mid-50s, and a few years back, I moved my investments to my wife's wealth manager. While I haven't caught up to her long-term gains, my current earnings and the growth of my retirement fund, compared to just relying on the 401(k), are pretty satisfying.
Thanks, I just Googled her name and her website came up right away. It looks interesting so far. I'm going to book a call with her and let you know how it goes.
Generally speaking purchases make you poorer and investments make you richer :)
A letter to Azul...............I'm 61 and after 40 years of going every day at 110%, I'm eyeballing that the end is near. Of all the videos I watch like this, your content gives me the best answers and ideas I need, Thank you. My hard work and buying that old, used car, instead of the new one, has paid off. I believe I'm financially secure to retire now (literally, right now). I don't have big worldly travel plans (my wife does :)) that will chew up a lot of capital, but there are things I want and need to do while I still have my health, so, looking at retiring a little early. Working on a plan to "bridge" the gap to 65 for Medicare now. Once that's set, I'm going to hold my breath, and, after 40+ years, stop getting up at 5am for work! It's going to feel very strange (especially because I've taken very little vacation over those 40 years) , but, good! Thank Azul!
What options are you considering to bridge the gap before medicare?
You may consider a 'retirement dry run' as Azul has recommended in other videos. Going all out for 40 years means just stopping and going full time retirement cold turkey may be a difficult transition.
I just tried what you’re doing. It’s hard to slam on the brakes so I went back to work part time.
2000 sq ft small house? My primary res is 1048, vacation condo 750. That’s all you need.
Azul, watch out with the blanket statement that growth stocks outperform over the long haul. As a mutual fund portfolio manager (I was ranked top 5%tile) you generally see value stocks outperform for long periods and then growth stocks outperform for long periods. Long cycle periods. Schv or SCHg type holdings.
I love your dividend approach. One fund I ran was an income fund. FI and quality equity dividend payers mix in one fund. Equity side was Similar to the etfs: qdf,dgro,dgrw,nobl,vig,schd. These are great ways to invest without the cost of a money manager. Low cost = more for the investor and you don’t need to worry about the individual holdings.
Love what you are passing on in these videos. Keep up the love and knowledge.
Thanks Mike for your input.
Thanks for the reminder about blanket statements and for sharing your expertise with the group. 😎 Azul
No! The 2nd home ALSO violates your worry free goal, in addition to your one home rule. Rental properties are not for retirees. Nope. Too complicated and the expenses are too variable.
He can move to Sacramento, and drive 90 minutes to Lake Tahoe for snow & water skiing. One home is a headache. Two is a migraine.
Agree. I also shun houses and prefer apartments going into retirement.
My guess is the 2 home strategy is only for a portion of early retirement. He’s young still, lots of energy left, maybe has a family member or close friend on location to take care of the place while he’s gone, then when he’s tired of skiing, sell that home or give it to the kids. It’s also a good way to stay diversified if stocks take a long hard hit.
@@meibing4912Do you mean to live in or own as rental properties?
Both actually. Some prefer to live in a house but I am lucky to have a large central urban condo at a perfect spot for home. As for rental apartments, they are much easier to manage - and I also believe the value is more stable and predictable than for houses. @@meterreaderpdx
Azul, you surprised me. I expected that you would say stick with a 3 bucket strategy or something. I am following the dividend paying stocks strategy for myself but I had a good model. I got that from my father who set up their investments for my mother that way. She lived 22 years after he died never sold a single share just lived comfortably off SS and dividends. She traveled all over, never had to give up her house or car, didn't want for anything and passed away with more than they started with 22 years before.
I don’t know how you could have a worry free sleep well retirement with 60 percent stocks.
Thank you so much for your videos. I’m 50 and honestly never even thought about all the issues you raise in retirement but you’ve definitely changed so much of how I was approaching this issue. Keep those videos coming and also appreciate some of the recurring themes as well- sometimes people like me need to hear things 3-4 times for them to sink in!
Good stuff Azul. We are savers/investors and I have always directed this on my own since we were 25. I just followed the writings of Buffett and Bogle, and dollar-cost-averaged into index funds for 40 years no matter what the market was doing. Never selling before retirement out of fear. The down market always recovers over time and we had plenty of time. This simple strategy has worked pretty well for us and we sleep well at night.
Nice video. I fully retired FIRE at 55. I follow my stocks every single day not because I'm worry, I enjoy it. Investing to me is my hobby. Ive been very successful and it gives me something to do during the day. In the afternoon, my wife and I go out and play.
Thanks for watching and commenting. Glad you are enjoying your 55 year old FIRE retirement. Well done. Word of caution. Two most expensive hobbies in the world are:
1) House shopping "just for fun"
2) Watching your investments every day
The risk is when things get scary. How often you watch your stocks is a significant risk factor for people who blow out of the stocks in scary times.
Azul
@@AzulWells thank you for your advice. I’m a long term investor and I rarely sell unless the fundamentals of a stock is declining. If a stock I own dips and I believe it’s due to external factors, I’ll buy more. Otherwise, I never sell the chicken that lays the egg, dividends. Take care and love your videos.
I always find it interesting how people are defined by their jobs. I'm a doctor Iawyer a teacher no identity beyond their work. I was never defined by my work. It was a job. When I told the regional manager I was retiring she asks do you know how much money you make! Yes I do but as Azul says I'm not going to live forever. Retirement has been great. Drives my A personality wife crazy though
Great vid. 59 and recently retired. Getting a Financial Advisor best decision we ever made. We also now have our Estate Planning set up thanks thanks to our FA.
Could you do a video on how a fee only financial advisor works? I have a meeting scheduled with one but they also manage clients accounts. Super confused with this.
Agreed with everything you said except delaying taking social security. I believe you should take is as soon as you are eligible to receive it and no longer plan on working. I believe this for two reasons - 1) If you do a present worth analysis of taking smaller payments at 62, larger ones at 65, and 69 you will see that the present worth is the same for all three scenarios so there is no advantage to waiting and getting a larger monthly payment. 2) You are going to need money to live on, take the social security versus taking money out of tax deferred accounts. Just my two cents.
If you have a family history of longevity, it can be good to delay SS and burn down your tax deferred savings before SS kicks in. Then you have 40% bigger indexed income and a lower average tax.
Azul, don’t take for granted that your senior kids, even though they’re doing well, won’t seriously ‘benefit’ from some extra cash when they are retirement age. My mother passed at 93 and her estate provided some real breathing room for me even though I’m successful.
Great plan. It’s interesting that a planner is going to hire a planner in retirement. That’s a strong message for retired folks.
Thank you for the video, I have already retired with a sizable savings. I am having a terrible time finding a good advisor, all I hear is put all you money in an annuity and give me a big commission.
I am 66, your plan makes a lot of sense and reconfirms many of my believes. Appreciate you sharing this on RUclips.
Azul, great video. You are a ray of sunshine. I think you should consider interviewing people with strong game plans. Investing always has a individual component, so what works for Azul is slightly different than what works for me. This would add additional food for thought for your viewers. There are the general common themes that are common among all good investors and these would also shine through. Thanks for sharing. I really enjoy your upbeat attitude. RUclips, the internet can be such a great place for people to interact in a positive way. Your videos are a poster child for positive internet content.
Thank you for your good advice. I have started to rethink my retirement plan of 67. I am going to see if i can do it sooner thanks to you!
What software do you use to track dividend paying stocks 1) dividend growth and 2) growth of the capital ? How do I 1)monitor dividend growth and also 2) monitor capital appreciation, with me spending the dividends. How much do I need to save to reinvest as I spend the dividends to live off of.
Great Video. Could you do something on health care savings accounts/ACA for those who retire before Medicare. Thank you!
Azul, understanding this vidis almost a year old but keep in mind the idea of renting out one house will become a full-time job, take it from someone who has done it. Airbnb nonsense or the cost of property management.. as the saying goes just because you can do something doesn't mean you should...move to a warmer climate and then go to ski for your holidays. All the best!
Why bonds and not a bond fund? On the dividend side - why not a fund like VYM or SCHD and the balance in the S&P 500 index?
Thanks for sharing! 👍 One point: Stress and worry wise, the two home strategy with a rental component is 2x worse than a two home strategy without, which you correctly vetoed. Sounds like wishful thinking. I would stick to one home and rent the other for 6 months (and one day 😉). Predictable costs that you can budget for, then walk away and SLEEP well.
I moved ours into a 60/40 balance a couple of years back. Bonds have absolutely SUCKED for the last 2 years.
Hello Azul, I really love all your videos and all the valuable information that you share with us. I am 62 years old and am thinking and planning my retirement soon from VCU Medical Center in Richmond, VA after working here for about 32 years. Your videos definitely helped me gauge where I am in the picture of average American.
By the way, I have a question: I know you like to take the video while you are walking, where are the places that you walk? Some of the places look really great and one day, I would like to visit some of those places.
Thank you again for all you do for all of us!
June Lee
You are the guy I wish I knew when I was more young.
A really great video. Thanks for putting it together. It gives me some peace of mind knowing that my personal strategy is very similar to yours. I too am 59 and I'm shooting to retire at 62. So far, my fee only financial advisor says that I am green lighted for that goal. And I have 60% of my portfolio in dividend stocks. Those dividends along with a small pension and along with social security at age 65 should provide the needed cashflow. Again, thanks for the great content!
60% in dividend paying stock is vague. Are you in ETFs, index funds or individual stocks? You're the man if it only takes you 4 hours a quarter tó track individual stocks. It takes me 4 hours to analyze one 10-Q report.
Great video and great content. You (Azul) do a great job with the information provided and never try to push an agenda. I love watching your videos. I'm 46 and hoping to retire around 55. I feel we are in a good place financially and love watching your videos to help me prepare for the next decade. I'd love to see a video that talks about how to plan for the gap between drawing from retirement funds, social security and healthcare if you retire earlier than 62+. Thanks for all you do and you are truly leaving a positive mark on the world by helping others through these videos.
I'm very similar to your situation. Hoping to retire at 55. My plan is to sell the house, use that proceeds to travel abroad (where cost of living and healthcare will be cheap) come back to US when we are 60ish and then collect social security at 62. By selling the house and traveling abroad that would allow us to NOT touch the retirement funds (they should actually be growing) until we come back to the US
Like you, I have always focused on investing in high quality dividend paying stocks. At the same time, I look for companies that have a history of raising their dividends year after year. This makes a huge difference in total return. Have a Happy New Year!
Hi Azul. How do you find a financial advisor you can trust? It is scary to give someone access to your life savings
Smart to never trust anyone making decisions for you.
Azul Thanks-for your down to earth practical advice! The only comment I would have is that you say at a certain age unfortunately we only have 1000 weeks left … I prefer to think FORTUNATELY I have X weeks left (I’m 69)
I want to understand your 60/40 portfolio vs your net worth. My stock/bond portfolio is 90/10, but also 40/60 if I calculate my 40% stocks vs. my 60% other net worth assets, like my real estate.
More and more people might face a tough time in retirement. Low-paying jobs, inflation, and high rents make it hard to save. Now, middle-class Americans find it tough to own a home too, leaving them without a place to retire.
The increasing prices have impacted my plan to retire at 62, work part-time, and save for the future. I'm concerned about whether those who navigated the 2008 financial crisis had an easier time than I am currently experiencing. The combination of stock market volatility and a decrease in income is causing anxiety about whether I'll have sufficient funds for retirement.
This is precisely why I like having a portfolio coach guide my day-to-day market decisions: with their extensive knowledge of going long and short at the same time, using risk for its asymmetrical upside and laying it off as a hedge against the inevitable downward turns, their skillset makes it nearly impossible for them to underperform. I've been utilizing a portfolio coach for more than two years, and I've made over $800,000
Mind if I ask you to recommend this particular coach you using their service?
'Carol Vivian Constable, a highly respected figure in her field. I suggest delving deeper into her credentials, as she possesses extensive experience and serves as a valuable resource for individuals seeking guidance in navigating the financial market.
She appears to be well-educated and well-read. I ran an online search on her name and came across her website; thank you for sharing.
I've watched quite a few of your videos. You've convinced me that I'm ready to retire now (should have done it earlier). Don't want to waste anymore of my 1,000 good weeks I have left. Your gameplan sounds solid and I'm going to mirror it. Thank you and hope you have a long and happy life.
Based on Monte Carlos the 60/40 vs 50/50 is just not substantial for the risk.
He has a high opinion of his stock and bond picker… If he doesn’t care to beat the index, then he should just buy a single ETF or maybe two and save the one percent that he is going to give the planner, heck with that savings he could even go more conservative as you suggest at 50 50 instead of 60 40
@@michaelcharach Well said. Thought the same.
"Die with Zero" was a great book!
Please explain what is a "fee only" advisor? Is this a 1% fee of your investment to the advisor? Or is it a one time fee when you sit down with them? I am guessing it is a flat fee not a fee on what your investments make??
This is typically a flat fee as a percentage of your assets being managed. 1% fee of a million dollar portfolio translates to $10,000 each year in fees.
@@BarbellFinancial Thanks for the explanation. I wanted someone to verify.
@@BarbellFinancial And what should I expect for that $10,000 fee each year?
@@Rottingboards The advisor will manage whatever money you direct to them and invest it on your behalf based on your risk tolerance and time horizon. Most likely their returns won’t beat the market average, especially when factoring in the fees.
@@BarbellFinancial I wouldn't expect them to beat the market average since it is a retirement account and they are trying to play it somewhat safe. Thanks so much for your responses.
Retired at 57. I would never employ/pay Financial Advisor.
@@lifestream4191 Yup I studied those things. For example I made sure to have Social Security at level Max - 200 USD. Or to have ton of Roth money etc etc.
I think the 2 house situation is fine if you have one that is the final “age in place” property(meaning access if in a wheelchair). We downsized to a townhouse with an elevator and a private garage at 2000sf from over 4000sf. The renting situation will work till it won’t. We also own a boat, a ski timeshare we love, plan on an RV for a while. No debt, in FL. Have relatives and friends in nice states we can visit. Recently retired in early 60’s from jobs we liked.
As to just looking at your portfolio once a quarter, I get it, but not my nature. I spent 2 years researching retirement, and am pretty certain I have a sustainable plan at this point, having considered multiple contingencies. It basically is, no debt, while creating base cash flow that keeps us solvent no matter what, and then everything else is discretionary spending. So even if the discretionary part drops 70%, we will still have “cheaper” fun. I even created 3 budgets, that I call Base, Moderate, and High. Started on the High, and even the Base has some fun money, so we can survive a major recession with no problem. BTW our Base Budget is well under$100k, so we are not “rich”
can you say more on HSA a video on how you will use a HSA for long care? Have not started one yet.
Great Video --- I'm 59 (retired 1.5 yrs ago at 57). I'm lucky enough to have invested at the onset in my career (actually - first stock I bought was at Age 14 - DeTomaso - my dad needed to be on the account - though UGMA I believe). I'm a 60/40 split and it has worked well. I did all my own investments until 20 yrs ago - then had a professional take over. Which was good - since I was 100% stock. I use my cousin's financial advisor (they did well with him). I didn't want to - I always did my own and actually it was my 2nd career choice (I went into IT - wished I took my 2nd choice). HOWEVER - they know how to minimize risk and know tax laws which has helped me greatly over the years. I do have ONE issue - I spend 30 minutes a day on investments - I have to stop looking at it - since I do add'l investing on the side (not trading) with funds left over from my distribution. My issue is healthcare - I have it through ACA - my plan is not qualified for a HSA. I HOPE to have my deductible ($8700/yr) fully funded by Feb. 2024 (approx $45k) until I can get medicare in a separate acct. THEN - all unused deductible amounts each year will be used to purchase a "new' car (I have a 2008 Pontiac Grand Prix - only 66k miles and in very good shape) by the time I'm 64 (I was born on Leap Year - so it will be my 16th b-day). Thanks again for all you do!
Don’t break the one house rule! It will complicate your life and you definitely won’t sleep well! Signed, Voice of Experience
You have given me pause. You are likely right. One of those things that sound good in my dreams, but not so much in practice. I’ll keep you posted. Thanks for taking the time to share your “voice of experience” with me and the community. 😎 Azul
@@AzulWells just trying to save you the sleepless nights we endured. But we DID finally sell that second home, barely breaking even after the expenses of maintaining it. I DO LOVE your advice and the way you present it. Signed, Out of Debt and Financially Secure. 😉
I think the two house situation will work, if one is the house you ultimately settle in and is adequate for “aging in place”. A lot of people forget that as you get older stairs and shower access and such become a problem. We downsized to a 2000sf townhouse with an elevator. We also have a boat(for now) plan on a used RV, have had a timeshare we love for 20years, and have friends and family in different states that we visit, when it’s Summer in FL. No debt btw, and recently retired in early 60’s from jobs we liked.
@@AzulWells I second that! Keep your one house rule.
@@AzulWellsLove that you are open to different opinions, Azul! 😊
how important is LTC insurance. i have seen a lot of bad policies -- expensive and not very useful.
Please put some example numbers on the screen on what a fee only advisor should be getting. If I have over a million dollars and my fee is 1% is that too much of a fee? What should they be doing for me?
I have been taking care of my main tax deferred portfolio until recently I handed it over to my financial advisor. He had been taking care of a smaller account and was charging a 1% fee on the portfolio. He offered to only charge me 0.7% for the combined portfolios. They go over my investments annually but I can call them at anytime to discuss any changes I may want to make or any questions about finance or what the markets are doing.
I trust Azul I think he has his viewers best interest at heart. This is a great video. Hoping for a video for people like me forced to retire earlier than planned at 59 with under 2 million. Can retirement be successful ?
Great video. Your goals and approach are spot on. Really resonates.
No worry is my #1 goal as well and it serves me well.
One spouse and one house also great advice. I am 50 years happily with my one and only spouse. We joke that the only way out is in a wooden box. We did the two house thing early on with a vacation home on a lake and the house in the city. Much better to rent when / if you need a second place. We have a house with a big pool in the city but beside a river. So miles of nature trails and view of a forest in the heart of a city. We actually don't need a lot of adventure.
I have no investment advice. Just set it up so you don't have risk or worry. We have agreed that when one of us dies the other will buy a big enough annuity to meet all expenses for life. Then we'll not get scammed when we have dementia.
Our wills leave everything to a good cause. No one will know or care that we passed other than a nice organization will have a happy surprise.
Azul, how do you choose a financial advisor? I mean someone who is not going to steal your money?
Hi. Love these videos. Is there anyway you can block these shill commenters who give names out for financial advisers? I notice a lot of them on your site and am afraid some people may not recognize them for what they are.
Agreed.
No I watch Squalk Box every morning. I use that information and balance my portfolio. I do snag some T-bills a few months ago when it hit over 5% (short term) and purchased some nice dividend stocks that pay well will low risk in known buissness. Sorry I watch my portfolio about 20 minutes a day. I sleep well. I have maintained my balance since retirement and have traveled a lot of the world. Oh most "normal people" do not have 5000 sq feet homes, more like 1900 sq feet so you are a different catagory
Here is my contrarian's opinion which is based on my own experience. I retired in 2020 at the beginning of the pandemic. I was 65 years old and the time and was eligible to pull out my pension out which was based on two "chunks", One chunk was a lump sum which most of it was IRA rollover and the other one is a monthly pay. Both "chunks" were, let's say, very generous. I rolled it over to an account at Fidelity, assigned the account to a very reputable Atlanta fiduciary firm and told them that I'm looking for a conservative investment which was mainly to keep the value of the money and receive some annual dividend. At the time, I really didn't need the money. My monthly pension income was good, my wife was working and still is, and at the time, we had seven rental houses that brought in a good chunk of money as well. However, after two years watching my Fidelity account stagnant and practically losing money to inflation, (About $40K in two years), I requested our accountant to do an analysis as to how much taxes I would have to pay if I pulled out that money out. My goal was to invest that money in another rental property. The accountant came back with a reasonable amount, I pulled out that money and added another house to out "Stable". We bought that house cash so aside from the usual expenses (Upkeep, taxes insurance, management) we don't have many expenses. and the rent is great.
My advise, especially to young people, invest in income real estate instead of stock, bonds, etc. Sure, for in long run you would probably make more money in stocks, but the equity in real estate, like in stocks, from a retiree perspective is meaningless. What is important, is the monthly income it generates. Real estate also have lots of tax benefits and if you cannot afford to buy real estate were you live, buy where you can afford. This is a vast country, and there is always demand for rental everywhere. Buy small, and let the tenant pay your expenses, whenever you can afford, buy more and by the time you retire, you'd be sitting on mortgage-free properties with a great income hedging against inflation.
I was a landlord for 13 years (we lived in the same house with the tenants) my husband got fed up with the tenants so we sold it 20 years ago. I’m supposed to be inheriting a house from my mom which is in NYC in an outer borough and I am debating whether to keep that house and rent it out or sell it. Rental mkt is good unless you get a bad tenant. Then you have problems.
@@jdenino6022 First, a rule of thumb, never landlord yourself if you can afford it. When I started investing in real estate about 15 years ago, all the properties I bought back then, were out of state. At the time, I lived in California and investing there did not make sense and was unfavorable. Second, if you inherit a house free and clear and you are not require to pay any "Death tax" as they call it, I'd say update the house to the best of your ability. The house that I bought in exchange for my IRA, was an inheritance. That house was owned by the seller's father. On top of the selling price, I had to spend about $50K to bring it up to a rental standard. Usually houses that are owned by retirees for with limited income, and for a long time, are mostly neglected and need some work. Doesn't mean you'd need to spend as much as I did, but it will need some work. In these times, it will be easier to rent out than sell. Find a reputable property manager and so you won't have to deal with the day by day operation, and you'll find soon enough that having that income is wonderful.
My wife and I own five rental properties, no mortgages. The rental income will be more than enough to meet our retirement needs which will be in ten years when my wife retires. We also have a Dividend portfolio which will be used to buy more rental properties during retirement at 50% down. I love property investment. I got hooked on it after our landlord unfairly evicted us 14 years ago.
@@robocop581 More power to you, great job!!
Tracking my investments is one of my favorite hobbies. Maybe I'm weird? Okay, definitely. But financial news following is fun!
I think it gives you a more balanced view of the going on in the world? You can't afford to be heavily biased on any one political philosophy, because the market is ultimately objective?
Ive been a high risk (technology) investor. Ive done better than any advisor i used. I can live on SS and small pensions. Im worried about my daughters lack of financial interests when she inherits it. I need a fee only advisor setup for when i croak
It's the first time I have heard anybody talking about using HSA for long term care. Paying medical expenses yes, but not long-term care. I think that would get people more interested in holding on to them during their earning years (when the opportunity presents itself). Maybe you can even do a video on HSA strategies, etc.
Azool talk about lower risk allocations especially when they meet ones income needs. Thanks.
Can you do a video for those living abroad say in Asia, Europe and the Caribbean?
I would like to think living off dividends is possible, but I recieved a wake up call last year with AT&T (T).
I hold a lot of T, and was happy with it , and why not? They had raised thier dividend every year for 36 years, they were considered a bellweather stock, Dividend Aristocrat, a stock for widows and orphans, because of their dividend, which was around 7%.
In 2022, the Dividend Aristocrat cut their dividend not quite in half. Surprise!
Dividend cuts can and do happen, even to the "Aristocrats", because sometimes their management makes bonehead decisions they can't recover from. 😬
I feel your pain. ATT stock is less than half its peak value. My lesson was from ATT. My dad’s lesson was from GE. Don’t chase dividends, just invest in good value stocks like BRK-B or index funds and plan on selling some shares on an as needed basis to fund retirement.
Very nice breakdown. Its unexpected and unnecessary but thanks for the transparency and openness about your real-life plans rather than academic theory.
I wish I had the confidence in being able to find a financial advisor that could make safe recommendations that you do but I've never found one. Ever. I have more confidence in the discipline of Berkshire Hathaway or just holding the S&P than any advisor. So I'll just diversify, diversify, diversify and pray. Thanks for the video. Great advise. Especially helping your kids when it will have the most impact! That is fantastic advice.
Love your channel. Love your sound logical advice! I watch your channel several times per week. And follow your advice.
Thank you!
Yeah I had the two house thing for awhile. Didn’t work out.
I'm doing all the things Azul is. 1 House 1 Spouse! Except this is spouse 2! But I ditched the first one when I was 30 so lesson learned. No mortgage. Have 401K 100% stocks but about 20% of that is in a Vanguard high dividend yield fund. S&P 500 is 35%. Have a pension. Have an HSA. Not thinking I'll get Social Security as by the time I take it I'll be means tested out of it. Despite having paid the max for most of my adult life. I got about 10 more years that I need to work. My question is, when should I start migrating 20-30% of my portfolio into short term bonds? Inflation is a killer. Thanks!
People frequently use the term “fee only financial advisor.” I took this to mean that you pay someone a fixed dollar amount and they review your situation. I asked a relative about their “fee only…” They said that their investments are under that firm’s control and that they pay a fee based on the assets under the control of that firm. They noted that the firm has a fiduciary obligation to them. This doesn’t make sense to me. Am I missing something?
unfortunately, financial advisors try to conflate things. There are really two major competing organizations: NAPFA and NAPA. The former emphasizes the benefit of fee-only advisors vs NAPA which tend to be commission based. Fee-only means flat fee, hourly/retainer, or % fee of assets under management (AUM). Azul has done a video about what fee-only means, and makes the point firms will bias toward moving clients into a %AUM structure vice flat fee or hourly/retainer for the firm's cash. To me that is the firm looking out for its self interest not the clients, which is a bit hypocritcal when the Financial Adivsor (FA) at the firm is saying they are a fiduciary. Two things can be true at once: the FA can be a fiduciary while the firm has not such obligation. Firms generally give client an option to grant the firm full discretionary or non-discretionary trading authority. I would never sign up with a firm that mandates full discretionary if you sign up with the firm, because there isn't an exigency that should require a FA an ability to immediately trade your assets without running it by you first. If your FA is putting you in such highly volatile and risky investments which require no notice discretionary trading, I would run away quicker than the road runner. Coincidentally, the firm azul is a partner, shareholder, and adviser does not give clients the option of full discretionary or non-discretionary: the firm requires full discretionary. I also think the focus on fiduciary is misleading. There is ethical fiduciary and legal fiduciary, and again just because your FA may be acting as your fiduciary doesn't mean the firm is. Even if you ask the FA if they are fiduciary 100% of time, you need to also get it in writing the firm is, too. The problem with legal fiduciary is that it is very difficult to prove fiduciary violation. I have never heard of an investment advisory firm or FA say hey, you know what after 10 years of taking 1% AUM from you, we actually think it's in your best interest to just put you on hourly/retainer rather than %AUM, since we haven't done anything to your portfolio except withdraw your RMD and of course or 1% fee.
I plan on living off dividends I don’t want to worry about CNBC or the 4% rule
Great video! Just wish you stated how many months of living expenses you'd keep in an emergency savings account.
My only home (mortgage paid) is 1740 sq ft. We've lived small so we can live large. :)
What is your recommendation on how to find Fee Only advisor? Getting lost in a simple Google search?
Great plan bro. I'll turn my asset management over to an advisor in my 70's before age related memory disorders set in. Ameriprise has some monitoring features for older at risk clients that are prone to scammers....
Renting out your home? No way... You just dont know renters.... Picture 2 dudes But-Fing on same bed you and you wife sleep on.... No way. Not worth it. KInda surprised you would go for that easy buck option. The trade off is not worth it.
You're definitely accomplishing the, "give back" goal with these video shares. Your channel has been inspiring as I move more toward sharing what I know and have experienced to help younger folks. Thank you!
Love your videos and keep up the good work. Thanks for sharing your insights, especially on the softer psychological side of retirement. I’m surprised you’re going with individual stocks. I know that you said you advisor will manage it, but it’s well known that very few money managers beat the market. Why not an ETF like SCHD or DGRO for your dividend portfolio? As for bonds, corporate bonds are often correlated with the companies that issue them. I’m surprised you aren’t using short and intermediate term treasuries.
You will get tired of the rental management pretty quick. Do not break your rules. Just do a long term rental for 3 months a year. That way you can stay in different areas and have more flexibility without insurance, tax, and repair costs.
Rental Income? It likely won’t work because YOU will want to live in each house IN season. That’s when others would want to rent it.
Thank you, Azul. I love your videos and perspectives. They help me test mine and form my own views.
A six month lease in a ski town in the summer, and a beach town in the winter? Good luck with that . . .
I am about to retire at 56 and cash flow is key. I am doing a mix of dividend stocks, muni bonds, covered call funds, and high interest CD's for cash flow.
I enjoy managing my investments. Indiv. Stocks: 25%; 50 % Index Funds; 25% Cash & Bonds
Hi Azul. Thank you for sharing this information about your personal portfolio and the reasons why. If you're looking for another video idea - I would be very interested in learning more about a) what metrics you look at when reviewing your portfolio's past performance and b) what topics you might discuss with your financial advisor during the 4 hours per quarter you spend on each.
Yes, please.
Excellent video. Thank you.
Question 1 - dividend stocks for cash flow - got it. But after you have to start taking RMDs won’t you have cash flow needs meet?
Question 2 - bonds scare me. Please do some videos on bonds. Why not CDs directly or through brokerage account instead of bonds?
Thanks so much Azul. I love your videos. Very informative and so clearly presented.
I have had a second home for almost 2 decades. I do Short Term Rental on it during the 7-8 months a year I am not in it. I am considering renting my primary the same way when I retire for the 4-5 months I am not in it
Very nice game plan, thanks? One question, why corporate bonds vs short term government bonds?
I own STRs and I plan to switch homes too once kids are in college. So I’m with you there. But the one potential flaw I see in your plan Azul is that one of those houses are in a ski mountain and you plan to occupy it during the ski season. I haven’t come across any good ski places that rent out well during the offseason. Tahoe is one that has a decent offseason occupancy rates and even that is only around 40% in the best of locations. To pull off what you are talking about, you either need to buy in all year round markets like Hawaii, or occupy them in offseasons that don’t overlap.
I could never own two homes and rent BOTH of them out for part of the year. Knowing other random people were living, eating, walking around my house, using the bathrooms etc....ugh....I owned a second home in a resort area for a number of years and the headaches were not worth it (emergency repairs, tenants that had to be evicted etc). Why not just own one house and rent someplace when you want to be somewhere else? My parents used to winter in Florida and rented a place (the same place) for 3 months every year to get out of the cold, snowy Northeast.
I’ve watch several of your videos and you’ve gone against what you advised, which is understandable because you more than likely in or above average group than in the median group. Thank you for your videos.
My stocks/ETS for the long haul: SCHD, COST, UNH, GOOGL, & AMZN
I don't qualify for an HSA, but that's a great thing! I have Tricare and if you know about that you know it's far more beneficial than HSA.
We're 100% stocks today and will be during retirement. It's not for everyone, but it fits our situation. We have a military pension, a federal employee pension, and a VA disability. Add our 2 SS (not always figured in) and we'll have $130k or more in annual pension income, $180k if we had SS.
Azul... really enjoy your videos. Easy to follow and great advice. Transitioning from working to a fixed income from retirement savings can be a challenge.
Great content Azul! I'm taking notes on this one & love your long-range plans. Question, can you expand a bit more on fees charged by wealth advisors. I've had a very good one since I was in my twenties and understand they typically charge from 0.25% to 1% annually, however, I also know that the fee they charge can largely depend on the amount of money being managed- Is it true that if a person's net worth is over three million, that annual fee is negotiable and if so, can you provide some tips for leveraging the best rate. I know that ensuring they are a fiduciary firm is also key. Thank you and happy pre birthday!
I’m just signing up with one advisor and he is fee based. Meaning a flat yearly fee and he advises me setting up my funds and accounts. We went thru my current retirement funds, one thru a mainstream company and another thru a retirement fund related to my profession. He said the amount I’m paying for mutual funds, ETFs and management fees comes to $3,800 yr. Reallocating to similar but lower fee (mostly vanguard) funds and not paying the management, just the $1k to the new advisor, I could save about half that. Wish I did it years ago.
Speaking of helping kids now (when they really need it) as opposed to later (when it may be more of a "blessing"); we have been able to help all three of our girls immensely with money now; mostly in the form of paying off student loans. For this they have all been so grateful. One of my daughters has been in school her whole life, but she is almost done; she is currently taking her Ph.D in Cognitive Psychology in New Zealand. Some of her friends think she is "spoiled" because we have helped her so much, and they have commented that to her, but from our perspective why not help them? We have the means and it sure helped them. Nice to come out of a doctorate progarm with no student loan debt.
This was your best video so far!
8 hours per quarter seems like a lot. I set aside an hour in the morning on the first of the month to review balances and update some spreadsheets. It's more like 30 minutes, so 1.5 to 3 hours per quarter. Maybe an extra 1-2 hours for tax filing per year. I think I've only rebalanced once or twice in the last decade after reviewing.
But I'm not retired yet, just borderline ready. I'd automate any withdrawals though, so that wouldn't require extra time.
Excellent video!
Two things:
What is a “fee only financial advisor” ?
The name implies a definition, but I just want to eliminate any possible misinterpretations.
How do you find a ‘good’ financial advisor ?
Please make a video that goes over how you spend your 8 hours per quarter reviewing your investments ? It would be a mechanical perspective. A proposed title: “A day in the life of Azul reviewing his investments” ;)
Exactly what tools and methods do you use ?
Thanks for the very informative perspectives and reflections.
The Males in my family die from ages 69 to 73 and I am 64 so The odds for a long life don't look so good, have a market account that contains 2000 shares DUKE, 2000 shares CAT, 2000 shares Exon0Moblel, and 2000 shares AEP. I get dividends to help support our life. I also have a play account for penny stocks for a hobby, sometimes I win and sometimes I lose. We are not eligible for SSI due to our work history. but get small pensions. I suspect we are lower middle class.
You have encouraged us to get our retirement portfolio together. I can’t thank you enough.
I enjoy my retirement, but also enjoy planning and managing my money flow/investment in retirement. It is one of my hobbies.
If you had a pension and SS that allows you to live comfortably and enjoy life what would your stock/bond mix look like?