Long Careers

Today it can be rather uncommon to find people working at the same company for several decades. However in the past, this was more of a common trend and many people would retire with the same company they first started with. Tony has worked with clients that fell into each of these categories and will share some of his stories.

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Website: http://www.yourplanningpros.com

Call: 844-707-7381

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Transcript Of Today's Show:

Host: Welcome in to another edition of Plan with the Tax Man. Thanks for tuning into our podcast, Tony, what's going on, bud? How are you?

 

Tony: I am good. How about you?

 

Host: I'm hanging in there, still surviving the heat. It started to cool off just a hair.

 

Tony: Yeah, [crosstalk 00:00:00:14].

 

Host: I think we've shared with our listeners before. Obviously, we've been doing our social distancing long before it was fashionable or required, whatever term you want to use. But I'm in North Carolina, and it's been really hot for the month of July. June was really, really kind of mild for us, but July has been pretty brutal. How are you guys doing?

 

Tony: Yeah, about the same weather pattern. June was pleasant. July has been pretty hot. August is generally the hottest around here-

 

Host: Yeah, I know.

 

Tony: ... and the most humidity. Then all of a sudden, it changes, almost just like that.

 

Host: Yeah. You guys definitely get a better reprieve than we do. Man, we've been at 100% humidity for like three weeks, which is just sticky, sticky, brutal. In a way, it turns it into a ... We thought it was going to be a short summer. When June was kind of mild, we were like, "Oh, it's going to be a short summer," but it looks like it's going to wind up being ... What do they call that? Indian summer, right? Where it's longer. So yes, it may wind up being a hotter one, kind of a long summer. Speaking of long, we're going to talk about a little something different this week. We're going to talk about long careers here on the podcast. Are you a basketball guy? Do you enjoy basketball, Tony?

 

Tony: I do enjoy basketball. Yes.

 

Host: Okay. Are you familiar with Vince Carter? Played in the NBA for a really long time, played for 22 seasons.

 

Tony: Yep.

 

Host: Okay. Yeah. As they used to call him, Vinsanity. He was still playing ... Oh my goodness. He was playing in the late '90s, early '90s, mid '90s. There we go, mid '90s, and when he came out, he did the dunk challenge. I mean, everybody was like, "Wow." Jordan was still playing. It was like, "He's going to be the next Jordan," and all that kind of stuff. He's had a good career, played for a lot of teams at this point. Obviously, over 22 seasons, he's bounced around a bit. But I think he was in Toronto for ... That was where he was at for a long time. But anyway-

 

Tony: Yeah, the Raptors. Yeah.

 

Host: Yeah. Oh, the Raptors. Exactly. Yeah. So that's a long career, 22 years, especially in sports.

 

Tony: Certainly in the NBA.

 

Host: Yeah, yeah, running up and down that hardwood.

 

Tony: Yeah. Day in and day out in that game, at that level, that's a long career to be able to do that.

 

Host: Yeah. The knees get a little sore, I'm sure.

 

Tony: Yeah. Yes.

 

Host: Well, now so we're talking about that being a long career. 22 years in the scheme of maybe ... What's the term? Joe Lunchbox, the average person, right, who maybe has worked at a factory or a plant or something, that might not be that long. You might be there 30 or 40 years, or at least that used to be the case. 22 years could be a long time in today's era. It seems as though people aren't staying at companies for as long. Obviously, again, COVID has caused a lot of issues there. But when people come in and talk with you, do you still see that person that comes in that's a new prospective client that says, "Yeah, I've been at X company for 30 years."

 

Tony: I don't see it very much. No.

 

Host: Really? Okay.

 

Tony: We see a lot more of people that have bounced around over the number of years than the old-fashioned person, and I'm going to pick on my wife.

 

Host: Okay.

 

Tony: So hopefully she won't listen in, but she is in the first camp. So I consider her the oddball today. So she's been at her place and she's now ... She's going to be 54, and she has been there 35 years.

 

Host: Wow.

 

Tony: Probably unless they downsize or something ... Of course, she's in part of the county government, so a very stable type of thing. She's probably going to be there until she retires, but she's the type of person that will go to work every day, do whatever they tell her, and does her work and doesn't really have ... Of course, she's been here so long she's not like me, who I've been in my own business for 25 years. But when I was working for somebody, I was always wanting to bounce around. I always was wanting to, "Well, maybe I can advance a little bit. Maybe this company is a little better work or a better culture," whatever-

 

Host: Right.

 

Tony: ... and, of course, certainly to try to make more money.

 

Host: Right. Chasing a little something more.

 

Tony: Yeah, you're always chasing. I think that's what we see much, much more than the first camp these days, unless you're either with one of the big, big companies or with the government.

 

Host: Interesting. Yeah, no, that's a great point. I didn't think about that.

 

Tony: So I tend to see that a lot in the taxes, because we'll gather a little history on people, and you can look back and say, "Boy, they had four W2s from this year, and now they've got two other ones." Over the years, it's not uncommon for people to work for 10, 12 employers over their careers.

 

Host: It's interesting, too. I saw a stat the other day, and, of course, I guess you could say whatever you want about stats, right? Because what is it, something like 50% of all stats are made up? But anyway, and it said Millennials, the younger generation, the 20 somethings, even in the early 30 somethings, will have between 25 and 30 jobs-

 

Tony: Wow.

 

Host: ... over the course of their lifetime, whereas just a generation before, to your point, it might've been 10 or less.

 

Tony: Yes. I think the important point here is no matter what camp you're in, going back to the camps a minute, so I've got a young son. He's in his first job out of college, working for Transamerica out in Denver. Big, big company. But chances of him staying there his entire career probably are not good. But I think it's important and I like this topic because I think no matter what, especially the people that are bouncing around, you've got to keep an eye on your finances, because you're in and out of 401ks. You've got different benefits at different jobs. Real easy to just kind of not pay attention, and then, all of a sudden, 20 years, 30 years goes by and you've got five or six different 401ks that are dormant all over the place. You're not even paying attention to the statements and haven't made any plans.

 

Host: That's your money out there.

 

Tony: Yeah. It's your money. So you've got to pay attention.

 

Host: Yeah. I was doing a podcast with a client in Michigan, and obviously automotive, right, a lot of times, people will work there for a very long time. He had a client not too long ago that had been ... I guess he had been at the automotive place for probably 20-plus years, and they were going through, doing the work, trying to work on putting a plan together. They actually found an old account from a prior job before he worked at the automotive industry there that he completely forgot about. It'd been sitting there, growing for 30 years and had a sizable chunk of money in it. The guy was like, "You guys are amazing." He's like, "No, you did this. We just found it."

 

Tony: How about all the ones, and we see this, is they'll have multiple 401ks, and then we'll just ask them, "Well, who's the beneficiaries on those?"

 

Host: Oh, yeah.

 

Tony: They can't tell you.

 

Host: Because it was 25 years ago.

 

Tony: Yeah, it was 20 years ago or something, and maybe they weren't even married then.

 

Host: Yeah, might have been their mom or dad. Yeah.

 

Tony: Yeah. So it's important to keep even that kind of stuff up if you are going to ... I don't recommend having that many all over the place. Too hard to keep track of. But if you do or even if you don't, you've got to get a handle on them and get the legal stuff, the beneficiaries and things like that ironed out.

 

Host: Right.

 

Tony: Then you've got to work on making sure that they're still meeting your needs. What if you started one at 18 and you were ultra aggressive and now you're 40 or 45 or 50, and you kind of forgot about that? You get a little closer, you may not want to keep that like that as you get a little older. So there's all kinds of things to think about there.

 

Host: Yeah. I like the way you kind of put that. Whatever camp you're in, so whether you've worked just a couple of jobs through the bulk of your working years or you've bounced around quite a bit, nothing wrong with either pattern. Just make sure that you're doing, the due diligence, if you will, for those situations. I guess when you think about something like that stat I was saying, where younger folks might have upwards of 25 to 30 jobs, I wonder what the criteria is for that, because we all start out with a simple job, right? Well, for the most part, right? Most of us start out maybe at a gas station while we're still in high school or at a retail store like Walmart or Burger King or something like that when we were all younger. So when you're at 16, 17, 18, are they counting that? Because typically you're not getting any kind of...

 

Tony: Right.

 

Host: I guess nowadays they do offer different kinds of plans and things, but back then, for you and I, Tony, I know when I had my first little retail job at the local Hills Department Store, which I think is long gone, there wasn't anything like 401k or any kind of retirement plan.

 

Tony: No. Yeah, same here. I did a little mail run. Yeah, you just wanted the check. There was no benefits or anything. But I think, too, along those lines, you want to make sure if you have a lot of things a lot of places, if you are working with an advisor, if there's a piece of advice I would give is make sure your advisor knows about everything and where everything's at, even if they're not helping manage that part of it, because that way you've got somebody else that's got a list of everything you have, because many times even your spouses don't know-

 

Host: Right. Good point.

 

Tony: ... where things are and what's going on. Then that makes it even harder, especially if something happens to you.

 

Host: Yeah. If the proverbial bus comes out of nowhere, no matter what that might be, and you're no longer here, people are going to be behind the eight ball, trying to figure out what was what and where's stuff at and so on and so forth. That's a great point. To your point though, I would think ... I did the same thing recently myself, Tony. I had two prior accounts from past jobs that I just kept for whatever, and I do this. I talk every day about this. So folks, if you've listened to our show for a bit, I definitely talk about procrastination, and I don't do it to pick on folks. I do it because I'm one of you. I'm a procrastinator, too, and so I talk about this stuff pretty regularly. I kept forgetting to move an old account. We call them an orphaned 401k, right?

 

Tony: Right, right.

 

Host: So I finally got off my you-know-what and got it switched, and I felt a big ... I felt like I really accomplished something that day, even though I did very, very little. I just made a phone call and had two conversations, and I was done. It's kind of silly, isn't it?

 

Tony: It is. But it's a good feeling when you can get that accomplished.

 

Host: Oh, no, it's a great feeling, but it's kind of silly that we shirk away from it, because I think we feel it's going to be super complicated and really annoying.

 

Tony: Yes. Most of us these days, unlike the old days where you had to move a bunch of paper, it's very, very simple.

 

Host: Yeah. Yeah, true, true. With the COVID alterations to how things have happened, there's the Secure Act and the Cares Act, and that changed some things. So this may be a good time this year in 2020 to get some things moved or done again within the parameters of whatever you're working with with an advisor or having a plan, and if you don't have any of that, make sure you're talking with someone who understands that, because there have been rule changes due to COVID and the Secure Act and, again, the Cares Act, as I mentioned earlier. We've covered those on the show. Feel free to go back and check out some of those podcasts with those. As a matter of fact, I think within the last 30 days, they've just made another change to some of that stuff as well. So we'll get the information, and we'll do a show on that coming up.

 

Host: So make sure you reach out, folks, and do that. As I say a million times, I always say it on every single show, before you take any action, you should always check with a qualified professional about your specific situation and how whatever advice you might be hearing or interested in may affect your plan and your decision, or lack thereof. So reach out to Tony if you've got those questions. He's here to help in the Des Moines area, Central Iowa area, (844) 707-7380, (844) 707-7381. You can also go to yourplanningpros.com. That is yourplanningpros.com.

Host:

All right. So let's take an email question, as a matter of fact, and we'll wrap up the podcast this week with that. If you'd like to submit one, again, go to the website, yourplanningpros.com. We've got one from Cheryl for you. She says, "Tony, my husband wants to pay off either our house or our rental property just so that we have something paid off. We have enough money in the money market account to pay off one of them. However, I prefer seeing a lot of money sitting in that account. It makes me feel better in case we need it for an emergency." Oh, boy, Tony. She says, "Who's right?"

 

Tony: Yeah. Right, and she wants me to pick sides.

 

Host: Put your marriage counselor hat on.

 

Tony: Yeah. So I'm going to take the easy way out and say I think you're both right. However, I think you have a slight problem of ... because I'm a big believer in being debt-free. I always have been as a planner and even in my personal life. So I think if you have the money to get something paid off, I say do it and do it now. But then I would say for Cheryl, since she likes to have money in the account, the way to build that back up is the cashflow saved from having that paid off builds your money market account back up. Don't spend a dime of it. Build it back up, and you'll be amazed at how quickly you're probably going to get that built back up. Then you have the best of both worlds.

 

Host: Yeah. True.

 

Tony: Now, if you can't and don't want to do that, well, then what I would do is maybe try to pay off the house as quick as possible. Cheryl, if you're not going to bend and let him do it, I would pay it off as quick as possible and make some sacrifices there. I think the problem, though, is you're using that money market kind of as your emergency fund, and you don't want to spend it on anything. So I think what you need to do maybe is get with your advisor and talk about, "Hey, should we use this as our emergency fund and never spend it unless there's a true emergency?" and then start developing some funds for some other things.

 

Host: Okay.

 

Tony: A lot of people will just say, "I've got a savings account. It's for everything." Then they don't want to spend it on anything. So I think if you divide it up to different purposes, then when that purpose comes up and rears its head, that money's spent on that.

 

Host: True. Yeah.

 

Tony: That's one way to do it. But I don't think there's any right or wrong by doing either one, other than I don't like being in debt and I would try to work very hard to get that paid off, even if it's from current cashflow. Then you're going to be in great shape.

 

Host: Well, I think that's a great point. So check with your advisor on what's going to be the best overall decision for your specific situation, of course, because, I mean, it's interesting, too, when you have something like this how you think about it. As you're talking, you're saying, "Well, maybe you could pay off the house, and then the money you were sending to the mortgage, you could now use to replenish the money market." I was going the other way, saying, "Well, you pay off the rental property, and as the rent comes in, you use that to build up your money."

 

Host: So there's lots of options, right? So it's interesting how everybody sees it differently. I saw it a little differently than you. You saw a little differently than Cheryl. Cheryl sees it differently than her husband, right?

 

Tony: Oh, yeah.

 

Host: At the end of the day, though, the math should be the one that kind of helps lead you down to the answer.

 

Tony: It's always the math.

 

Host: Yeah, it's always the math. All right. Well, there you go. Well, great question, Cheryl. Thank you so much, and sorry we're just not going to pick specific sides. But come on in talk to Tony if you guys would like. Have a conversation with him. Give him a call at (844) 707-7381. That's (844) 707-7381, or go to yourplanningpros.com. Don't forget to subscribe to the show while you're there, and that's going to do it for us, my friend. Thank you so much for your time.

 

Tony: All right.

 

Host: I appreciate you.

 

Tony: All right. Take care.

 

Host: Have you been able to ... I know you love golf. Have you been able to golf any?

 

Tony: I have golfed. Yes.

 

Host: Okay.

 

Tony: We started out slow this year, because they wouldn't let us use carts.

 

Host: Right.

 

Tony: But now we are back to golfing and just doing some social distancing.

 

Host: Sure.

 

Tony: But yeah, pretty much everything here is open. A lot of people golfing. I think it's because many of them are working from home and have been laid off.

 

Host: Right.

 

Tony: They've got nothing to do.

 

Host: We're still in phase two here, unfortunately, in a lot of ways, and it's just been so hot that yeah, if you're golfing, you're there at seven AM. If you're not done by 11, you're crazy-

 

Tony: Yeah, it's going to be hot.

 

Host: ... because you're going out there, you better take like five gallons of water to stay hydrated. Otherwise, you might pass out. Well, I just wanted to just check and see if you're getting some golfing in, so that's good. Well, we'll talk about that in the future, I'm sure. All right, folks. We'll see you next time. Don't forget to subscribe to us. We'd appreciate it, and thanks for your time here on Plan with the Tax Man with Tony Mauro.