Here's Why You Shouldn't Worry Regardless Of Who Is In Office

Today is me going through how you can plan knowing about whatever , whoever's in office , whatever changes occur , whatever tax brackets get adjusted , any what-if scenario . That's what today's all about .

I want to give you some stats that are going to not just give you confidence but might make you think a little differently about your retirement , and my hope is that , truly , you don't worry about a bunch of stuff after this episode . So , yes , I am a financial advisor and my job is to advise .

I view part of that role as telling you stuff not to worry about . So when your neighbor or coworker brings something up , you'll go . It sounds interesting , but I don't know if that applies to me . So , with that being said , let's hop right into the episode Now . I , of course , love this stuff .

I don't care if you like Trump , if you like Harris , if you're upset about the results . I know this episode's coming a few weeks after , but the principle is the same . I want you to know the position that you're in , regardless of who's in office , and how that impacts your potential retirement investing horizon . You name it .

So on YouTube , you can , of course , see what I'm going to bring up on my screen right now If you're listening on the podcast app . Totally cool , I'm going to explain it for you . So , so this is saying from 1948 to 2023 , what is the growth of $10,000 in the S&P 500 ? Why am I bringing that up as my first example here ?

Well , the reason I'm bringing it up is I hope you can start to realize and sometimes it just takes some of these things to click to give you confidence that you're going to be okay , no matter what is if you invested only under a Republican president Once again , I'm not telling you who I voted for , didn't vote for , not what today's all about .

I don't believe in going into that . You can see , if you only invested on a Republican president and this is a study done by Charles Schwab who said hey , we're going to detail a hypothetical investment of $10,000 in the S&P 500 . How much would that have grown to ?

And so you can see here , if you put $10,000 in , what would have happened is you would have $312,000 if you only ever invested when a Republican was the president . Now you can take the same example and say what if we only invested when there was a Democrat in office ? And it shows the sample would not be $10,000 to 312 , but $10,000 to 1.2 million .

That's significant , but that's nowhere close to what I'm about to tell you , which is if you stayed invested the entire time and there's lots of graphs I can pick from when it comes to politics , this is my favorite one , and there's lots of graphs I can pick from when it comes to politics , this is my favorite one your $10,000 today if you put it in in 1948

, would be $37.8 million . So this is hopefully encouraging you to go . Wow , it's not like 10,000 became 300K or 500K or a million or 10 million , 37 million . The overall message stay invested , no matter who's in office . Now what I imagine many of you are thinking is well , it's not just who's in office , it's what about tax brackets now ?

What about health care now ? What about my withdrawal strategy ? How does that change ? So I have a couple that I work with . They are a lovely couple and they were really concerned about the politics that were going down , and we had a transparent conversation about it . It was about 20 , 30 minutes . And then I said hey guys , what's the ultimate worry here ?

Like , are you moving out of the country ? Is that how big your worry is ? They go . No , I'm not moving out of the country , but I'm just worried that markets don't do well . That's going to change my retirement . I asked the spouse what about you ? They go , I'm not worried if markets don't do well , I'm more worried about tax changes . And I said great .

So it sounds like the ultimate worry is are we gonna be okay ? Do I have that right ? And they go . Yeah , it's these things that are getting me the anxiety , which is the short-term stuff . I said look , you're a human , you're not a robot . Let me show you something . So I'm gonna explain . You are watching , indeed , on YouTube .

So this is what's called stress testing , what if scenarios , and to me , this is what actually breeds confidence in retirement .

Some people are really hoping I'm going to tell them one thing that's going to be like a light switch and all of a sudden they couldn't spend in retirement because they just didn't have it in them , because they're a saver and now they can spend , or that I'm going to say hey , you're wondering exactly when you can retire . It's this exact date .

Retirement planning doesn't work like that . It's more of hey , are we confident that we have the ability to never run out of money based on these assumptions here ? That's what makes it more difficult . So what I like to do is I like to stress test things , and so you can see here , even the best retirement plans will be exposed to various risks .

Those could be what if you retire and get unlucky and markets drop ? What if Social Security is reduced ? What if inflation is higher ? What if your returns are lower ? What if taxes go up ? What if you live till you're 150 ? What if health care costs go up ?

So these are things that don't induce anxiety , but what I find is they actually alleviate it , because you know where you are in relation to your goal and I would want all of you to go wow . So if I'm like the most unlucky person ever , I'm not going to run out of money , like why am I still worrying ?

Others of you are going to go look , I would love to retire tomorrow , but if you're telling me I could prevent against any kind of unluckiness by working two , three more years and really giving me a lot of confidence , well , now you're working for a very specific purpose , because the worst thing you can do , in my opinion , is work and work and work without a

very clear reason for that Meaning . Are you working six more months so that you can save enough cash to be able to pay for health care ? Are you working two more years so that you can get a little bit more into the 401k ? Not withdraw from your portfolio so that your withdrawal rate is 3.8% ? Do you have a very clear goal ?

What I find is a lot of people are just working , going . Yeah , politics , stuff is crazy . I'm not going to retire now . Oh my gosh , I'm not going to retire now because what if markets go down ? I just don't think this is the right time and they're finding some excuse to push it back because it's easier to push it back .

I am the weird , transparent advisor that's coming to you guys and going guys , don't take the cheap way out . Run the what if scenario . See what you're on track for and maybe you are good to go , maybe you're not , but at least you have the answer . It's almost like imagine I hurt my knee and I'm a soccer player .

It's almost like me trying to avoid the MRI . It's like I have a scan done .

You guys a lot of you guys have a plan , but you don't have the right person interpreting it and going yeah , I know the MRI shows the scar tissue is not that bad , but actually I'm moving it right now and your knee is not in my knees , okay , okay , so don't freak out , um , but I want to make sure you go . Okay , I have an MRI .

I also have a scan that tells me the true , like I can see the break or the tear , but I also have someone interpreting it saying yeah , turns out , it's not just your ACL but it's also your meniscus . So your whole physical therapy program is different .

So , to use an example for financial planning , if you look at my screen here , I'm also going to explain it . This is what I like to do to really breed confidence in retirement , and I'll do this with a client . I'll go look , your current probability of success is 85 , 90% , whatever it is . But what if markets drop 20% as soon as you retire ?

How might that impact the plan ? Well , that impacts the plan , but we're still on track . We still feel very confident . We won't run out of money . What if social security gets reduced and it's gone by 30% by the time years starts . What if inflation goes up by 2.5% , meaning more than it's projected to be ?

I'm always conservative in my planning , but this is where we need to be careful , because some people want to put all these levers to the maximum . Yeah , what if my returns are 5% lower than I think ? And what if I live till I'm 120 ? And what if I you know , tax brackets go up like crazy ? And my healthcare ?

Well , we don't want to be so unrealistic , which I see as well , where people are really just trying to convince themselves yeah , I should just keep working , because this whole concept of retirement is still weird .

This concept that we would not work ever again and have income for 30 , 40 years like still a difficult concept , and have income for 30 , 40 years like still a difficult concept .

So this what if scenario planning , when I have a client that comes to me and asks about politics and how that's going to impact their plan , I'll discuss it and then I'll bring it back to the what if scenarios . And what's the real worry ?

If your worry is that all of a sudden , you know you don't feel that the ethical issues are going to be , you know , in alignment with what you're looking for , I go that you have more than a right to , but that's not going to impact your retirement planning because you're not going to run out of money . The social side to the financial side that's different .

I'm focusing on the financial side and I don't want any of you going , ah politics , maybe I should get my money out of the market and then try to go back in later and the timing works out and look at the craziness going on . I have a lot of graphs and I have to pick and choose which ones I want to use . I'm very careful about that .

But another one that I like I'm putting on my screen now once again on YouTube , if you're listening on the podcast app same principle that I'm going to explain , which is what does history tell us about elections and the market ? It goes up . So the example I used before was 1948 , but I could go all the way back to 1926 .

And I hope the message that you're seeing on my screen right here is just it goes up . That is the overall message . Regardless who's in office , markets go up because it's not presidents dictating what's going to happen , the complete earnings and the quality of valuations , and they're not dictating that .

Regardless of who's in office , like amazon is still delivering packages and I'm still here drinking water out of my hydro flask , and like I'm recording this right now with a canon camera and apple macbook pro . Um , I was thinking , is it a macbook air ? I don't know , but it's a pro um .

Just I know you guys needed to know that right now , or you couldn't't know , but it's a pro . Just I know you guys needed to know that right now , or you couldn't retire without knowing if it's a pro or an Air . I get it . So , with that being said , that's what I want to go through on this episode .

Hopefully this was helpful , giving you some alleviation , if I can , of anxiety that , no matter who's in office , you're going to be okay , but also starting to get serious about when I can retire when I'm in a spot to do so . Once again , that's what we love to do here .

So if you are looking for just the software and the access to the what-if scenarios I'm showing you can see in the description you can join the Academy to run these projections for you If you go . I want the full service model . That's what I'm looking for . Ongoing planning service model that's what I'm looking for .

Ongoing planning , proactive management , tax , estate withdrawal , healthcare Of course , that's our business and that's what we like doing . So if you're interested in that , I encourage you to reach out . I am very transparent . What we do is not for everyone , but for clients that go . Yeah , I really want to optimize . I don't want you to just tell me to rebalance .

I want tax help and withdrawal and healthcare and insurance and the next level planning . So that's what the podcast and the YouTube videos are here to help you understand more about our business . I hope that this is helpful and if it is , I kindly ask that you share it with someone you want to retire early with . I'll see you guys next time .

Thank you for listening to another episode of the early retirement show . If you have a question that you want answered in a future episode , you can always go to my website , earlyretirementpodcastcom . That's earlyretirementpodcastcom , and you can go ahead and submit a question that I'll look to answer in a future episode . Thank you all for listening .

Please do rate it , review it and share it with someone who you think would benefit from this information . If there's anyone out there that you know , I certainly appreciate it and I will see you all each week . Hey guys , it's me again . Please be smart about this . Nothing in this podcast should be construed as financial , tax or legal advice .

Consult with your tax preparer or financial advisor before taking any action . This podcast is for informational purposes only .