James, This is very helpful. You do explain these financial strategies in a fantastic way. You're the Best of the Best on You Tube.
@mucusofwanderhome69457 ай бұрын
I always find it more interesting how everyone seems to have a pension in 90% of “scenarios”. I guess it makes the stories better .
@Tony-dx3eo6 ай бұрын
Agreed- been working 35+ years for several different large corporations and zero pension for either my wife or I. Our future financial security rests firmly on our shoulders alone hence why we still need to continue our work journey.
@shanasvensson73845 ай бұрын
Govt workers
@Kayla11113Ай бұрын
And they all have millions. Real normal!
@jeffgagnon26226 ай бұрын
I really liked the dividend component, gets the mental gears turning.
@benmccarty45987 ай бұрын
James, another outstanding video and great insight on the very good question topic!!! My and I can relate to the submitted question, and love your take on it. They may not need a 3 bucket portfolio 👍🏼
@JandD1277 ай бұрын
James' suggestions have really raised some questions we plan to dig into.
@ra9r4 күн бұрын
Bucket 2 (income 5-8 years) would be more interesting. Please do one on that.
@BadPhD7777 ай бұрын
A good tip I heard recently: when the market is up, you want to draw from bucket 3 for expenses and leave bucket 1 alone so it will be there (and full) when your investments in bucket 3 take a dip because the last thing you want to do is sell stocks when they're down.
@JandD1277 ай бұрын
I agree, James talks about Guyton Klingler guardrails that helps guide WHERE to pull the funds (Stocks, Bonds, "Money" reserve). It makes sense to me.
@CTHou136 ай бұрын
I love the bucket system
@mikehennecke38467 ай бұрын
Hi James. Love your content. I'd like to ask a question that I haven't seen you answer yet. At what age should you start working with a financial advisor. Additionally what steps should I be taking in my 30's to prepare for a successful retirement? Thanks for all your valuable information!
@Chasing726 ай бұрын
It’s never too early to start working with an FA. If you start at 32, you’ll have time to check out a few and then stick with one you really like for the long term. In your 30’s, simply put, be socking away as much as you can and live as frugally as you can stand to.
@shanasvensson73845 ай бұрын
My bucket 1 in vanguard mutual earning over 5% and two other funds managed by Vanguard paying divs and CG and i focus less on market yps and down but my overall yield/ gains at end of year.
@richdewitt7607 ай бұрын
Well done James..Thank you!
@davideberhart95237 ай бұрын
Great video James. Watching this today over a cup of afternoon coffee and thinking, "When is a strategy not a strategy?" In other words, yes...making the correct decisions with allocations, factoring other sources of income such as pensions, dividends and available cash...make it unnecessary to choose from the typical bucket strategy, guardrails, etc. My wife and I are in this exact situation. The strategy is to use the two pensions, two SS and two dividend distribution accounts to live on and never touch the principal, allowing it to grow as a legacy portfolio. I guess that's a "strategy" but it takes out the guess work and forces us to focus on allocation into growth, value, Large, Mid, Small Cap, mixed investment grade corporate bonds, to serve as a backstop. PS. No mortgage, paid that off years ago and double dipping on pensions, too. Will retire in June 2025 at 63 and 59 yoa. The only thing we need to think more about is when to start taking SS? Love your style and delivery techniques while teaching your viewers various "real life" scenarios.
@dforrest45037 ай бұрын
$350k for bucket 1, after pensions, seems like a lot. But to each their own, I guess.
@JandD1277 ай бұрын
350k/5=70k + 40k pension + 20k pension till 2033 = 130k - taxes - pre-medicare costs - go go years finance... I'm not sure what I'm missing?
@reneelewis426813 күн бұрын
invest ur bucket 1 in IRA high yield saving.
@macgeek21126 ай бұрын
Couldn't watch because of the bouncing camera. Had to listen only. Good info as always.
@zegeyealemu11013 ай бұрын
Thank you. Was wondering why RMD is not included in the process.
@brianh66803 ай бұрын
Historically, the average downturn is under one year and the average recovery is under two years. Isn't four years of expenses in CDs and other short-term instruments, in combination with social security and dividends, a sufficient safety net, allowing remaining investments to remain in growth?
@momplaygroupfouz49467 ай бұрын
lol😅I have a bridge to sell anyone who thinks these are real questions. He makes them up. Normal clients do not know what they do not know. A couple making less than $200k but saving $100k makes zero realistic sense. Where do they live? In the woods?
@JandD1276 ай бұрын
Nope... FL. 🙂 James was guessing at numbers based on the Roth... Maxing 401k, 403b, 457b (all pre tax), and a brokerage account. Late starters, trying to catch up.
@shanasvensson73845 ай бұрын
They must work for govt. Yall funding that pension. Lol
@bruced.3707 ай бұрын
Sorry, i can't watch a video about rich people who also have a oension too. I just can't relate to this. I have to stop this video.....
@nibpicky5 ай бұрын
You don’t have to relate to everyone to learn something. Maybe in 20 years you’ll be just as rich if not richer and you’ll have more insight than if you just skipped all these videos.
@everlastingarms30653 ай бұрын
Rich people are rich because they pay attention to educational things like this and have the long-term discipline. It's not just about the (large) numbers, but about the percentages and concepts, regardless of how large the numbers are. Go well.
@spdog33447 ай бұрын
I’m nowhere near retirement (32 y/o) but I love financial planning content haha great video! I don’t know anyone my age with a pension and not sure I trust Social security to be there in its entirety. The way we are planning, if we do get SS it will just be icing on the cake.
@CTHou136 ай бұрын
My children are aged 23 and 24. They are on track to have $5 million by the time they’re 55 years old. If Social Security is around, it will only benefit that. Invest in your Roth, max out your 401(k), invest in the stock market or real estate, set up your disaster fund, set a budget and live within your budget under your means and don’t overspend.I love to see young people succeed good job to you for starting early
@jameswitte56766 ай бұрын
40 years ago we said the same thing about social security. It’s not as good now as it was for my parents and it will probably be worse when it’s your turn.
@krjohnson295 ай бұрын
Can I just say: This couple seems like they are in incredible financial shape. Should be spending their time planning European vacations instead of worrying about how to invest their conservative bucket imo 😂
@ld57147 ай бұрын
James, great insights and discussion on this interesting quesiton. Thank you for sharing your knowledge and expereince to help your followers.
@markb85157 ай бұрын
Thanks James, another very informative video. You have a great way of explaining the thought process you need to go through to find the best solution.
@janethunt4037Күн бұрын
Thank you, James. This clarified A LOT for me. Thank you for sharing all aspects of how to think about the bond section of the portfolio. It is the most helpful video on this topic, and I've been researching this heavily.
@williamrogers12197 ай бұрын
Paying the house off early still leaves the property taxes and homeowners insurance. The only savings is the mortgage interest.
@shanew73617 ай бұрын
Yep, and they both only go up every year as well as health insurance premiums and deductibles. Don't forget maintenance on the home too.
@celloplayermom6 ай бұрын
Well, the savings is not just the interest but also the principal too. Not having to pay the P&I can still be a substantial monthly savings.
@everlastingarms30653 ай бұрын
But that mortgage interest is often hundreds of thousands of $$ down the drain long-term.
@Jack519716 ай бұрын
More risk more reward...Vanguard Growth Company funds? Buy..hold....❤
@maxjackson62276 ай бұрын
Is there a plan for people who make 40 thousand dollars a year?
@JoeCoIIar6 ай бұрын
Amazing when you are informed of all the laws and investment vehicles how you can survive financially. Thanks James!
@shanew73617 ай бұрын
They don't have 2 million, and they will have to pay taxes on some of that money. Not all of their money is in a Roth. You're not considering taxes and inflation.
@anthonyelizabethmuia30007 ай бұрын
Unrelated question. My husband and I are hoping to retire early...60 years old. We are dual US/Canadian citizens and will be living in Canada at least 4 months of the year. We would like someone to look at our numbers and advise wether it's better to reclaim residency in Canada for free healthcare or to just buy insurance through exchange. If we do reclaim residency how does that impact our taxes and estate should we pass while living in Canada. Are there financial specialist that can do that? Some direction would be appreciated.
@MichaelToub6 ай бұрын
Great Video!
@Jbedard19636 ай бұрын
Fantastic piece. Just so you know, I watch a DIY KZbin channel titled "I was Retired". He recently did a piece on the best places to get quality, unbiased information and he mentioned you. This was excellent and I'm passing your info on to all I know. We're inside the window, I was taking very copious notes and you posed a great question ... "Do you even need a bucket 1"? Thanks for furthering my education on our approach. I'll be watching all your content in coming episodes. Thanks again!
@RootFP6 ай бұрын
Thanks for watching!
@linnyh82427 ай бұрын
After they come up with the number for bucket 1, and even 2, if they have a young adult child, I would contact a New York Life agent and put them in through 5-year pay custom dividend-paying life insurance through the child. If they prefund, now they can get 12% for year 1 and 6% every year after for the entire amount in prefund account. It's practically a tax advantaged compounding corporate bond based returns while liquidity of an online account via practical wash loans. Shouldn't bother with the lifetime hassles of swapping CDs and Treasuries just to get taxed each year, or the volatility of bond funds.
@rayzerot7 ай бұрын
My questions- does the 6% payment increase with inflation? And why aren't financial advisors suggesting this as a solution, aka what drawbacks aren't we seeing?
@linnyh82426 ай бұрын
@@rayzerot I think you are thinking of SPIA. What I described was to prefund a dividend paying life insurance. The 12% for year 1 and 6% every year after are fixed rates for the entirety of the amount in prefund account. Other than those fixed rates, there won't be growth for like 4 years via dividends but after year 4 people can expect around 5+% tax free growth in the policy even if rates go back down to zero for a while (that was the case even when interest rate was practically 0 for 15 years). Most financial advisors do not know much about insurance products and they can be company-specific, all they want to do is gather AUMs and charge the second biggest fees in life, after taxes. The money in the policy is likely outside of AUM which they control and can charge for.