Transcript
Speaker: Oh, and we're back again.
Speaker: Bigger Talks, Bigger Talks, IG Live edition.
Speaker: Financial Fridays.
Speaker: I think it's going to be a new topic.
Speaker: I think financial literacy is very, very important, people.
Speaker: We can talk about followers, talk about fame.
Speaker: You can talk about being liked and loved, but we have to normalize a conversation with
Speaker: around our financial matters and about money, as well as our mental health, because our emotional EQ, emotional intelligence is usually affected by our money and our mind.
Speaker: But I have a special guest today, Annalisa Moncal.
Speaker: She's a friend of mine.
Speaker: She's very intellectually sound in the financial sector.
Speaker: She's a financial advisor.
Speaker: And she actually helped me set up
Speaker: some retirement accounts a few years ago, and she's given me so much information, books, and knowledge on financial literacy.
Speaker: So she's going to come on, I'm going to introduce her, and we're going to talk about money, you know, and investing, saving, and all these beautiful things.
Speaker: So thank you for joining us, and it's going to be special.
Speaker: One second.
Speaker: Let's see.
Speaker: I'm going to invite her.
Speaker: Let's see.
Speaker: One second.
Speaker: Hey!
Speaker: How are you?
Speaker: I'm phenomenal.
Speaker: Happy Friday.
Speaker: Happy Friday.
Speaker: Thank you for joining me on Bigger Talks.
Speaker: Thank you for having me.
Speaker: Can you hear me okay?
Speaker: Yeah, everything's good.
Speaker: We're great.
Speaker: Why sucks up here, but it's all right.
Speaker: We prayed about this.
Speaker: Okay, good, good, good.
Speaker: You know, everyone, you know, watching and listening, this is Annalisa.
Speaker: She's amazing financial advisor and expert.
Speaker: So before we get started, can you kind of give the people a little bit about what you do and what field of expertise from the financial space that you're in?
Speaker: Yes.
Speaker: Yes.
Speaker: So basically what I do is I do retirement planning and investment planning and business planning.
Speaker: So it's either with individuals or maybe, you know, companies and the beauty about my business now or my company, I should say.
Speaker: So I was a financial advisor for a wealth management company.
Speaker: for 12 years, right out of college, right out of business school.
Speaker: And at that firm, I could only help the wealthy.
Speaker: Oh.
Speaker: Yeah.
Speaker: So you had to have 2 million to invest with me.
Speaker: So there's companies that are intentionally out there just to help the wealthy.
Speaker: Yeah.
Speaker: So they're money management companies.
Speaker: That's what we did.
Speaker: We had a minimum of 2 million.
Speaker: And now I can help middle America.
Speaker: So basically I don't have a minimum.
Speaker: So it's more rewarding.
Speaker: I love it.
Speaker: I've been here for about seven years now.
Speaker: So that's why I'm here.
Speaker: And it's based on financial literacy.
Speaker: It's basically getting people educated and sharing information that's out there that I really didn't even know.
Speaker: I didn't even know it coming from the finance background.
Speaker: So, yes.
Speaker: You know, from a natural perspective, why do you think financial literacy...
Speaker: in a general space, why is it not a number one thing we educate people on in schools or a number one thing that we talk about as friends, acquaintance, family members?
Speaker: Why is that not like, why is it such a touchy or taboo subject for some of us?
Speaker: You know, it starts with mindset.
Speaker: It starts with mindset, how you grew up.
Speaker: You know, there's those phrases, money doesn't grow on trees.
Speaker: Money is the root of all evil.
Speaker: First, you have to work on your mindset.
Speaker: So a lot of people, what is your relationship with money, you know?
Speaker: And money,
Speaker: money is greedy, you know, you know, like things like that, you have to kind of ask yourself, what is my relationship with money, you know, and also it's not in a lot of schools, you know, I don't have the sticks in front of me.
Speaker: But we need financial literacy in high schools, I think, because the minute you get to college, you're getting credit card companies reaching out to you, then you're going to be in debt, people don't know about this, you know, a lot of parents don't speak to their kids about money.
Speaker: So there's a lot going on there, you know, and.
Speaker: It's important because so, you know, two weeks ago I ended my savings challenge that I was pushing out for 10 weeks.
Speaker: I'm going to save $25 every week.
Speaker: So you're going to end up with $250.
Speaker: Right.
Speaker: So $250 is not a lot of money, but this is the thing when I'm trying to get people to understand.
Speaker: Everybody wants the big bucks, right?
Speaker: But we have to learn.
Speaker: get to build a habit to understand how to have a better rapport and relationship with money.
Speaker: So, and I think what happens is people, they don't have no structure around money.
Speaker: They may have structure around work.
Speaker: They may have structure around their outfit, how they get dressed.
Speaker: They might have structure around their social media accounts, but we don't have structure around money.
Speaker: So say for instance, right, I have somebody say for instance myself,
Speaker: say $250 and now I'm like okay what do I do with this money or what could I do with this money to get some type of return on the saving because you know there's only $250 but I want to make some money off my money what is the first thing a person should think about if they have some money saved and they want to put it to use what should be the first rule of mind okay so when you say put it to use yeah what do you mean by that
Speaker: Like I want I want to invest my money in it with the intentions of potentially making some money off of it can be 5%, 10%, 20%.
Speaker: I just want to have a vehicle that if I save this money, or maybe or maybe I should put it into a fund account and just save it for the year.
Speaker: I don't know.
Speaker: I'm just trying to give people information about because there's a lot of people who save money, but it just sits in a bank account.
Speaker: Exactly.
Speaker: It's not really making no interest.
Speaker: So from your side, what show a person, a middle American, young guy, he's 25, you know, he makes $18 an hour.
Speaker: He has a little bit of money.
Speaker: He just want to put it to use.
Speaker: What should he do?
Speaker: Got it.
Speaker: So one thing you have to think about is, so if you're saying a young guy, right?
Speaker: We want to make our money grow for us, right?
Speaker: We want our money to work for us.
Speaker: So what does that mean?
Speaker: One, we have to outpace inflation.
Speaker: So right now, inflation is, from the last time I saw, it's almost 7%.
Speaker: Right?
Speaker: It's at a high.
Speaker: It's crazy right now.
Speaker: Look at gas prices.
Speaker: Look at everything that you used to buy.
Speaker: It's gone up.
Speaker: Everything has gone up.
Speaker: Even, I don't know, like groceries, everything.
Speaker: Everything has gone up.
Speaker: Gym memberships.
Speaker: I was just at a gym.
Speaker: I was like, oh my God, it's that much now?
Speaker: um so it's inflation that's what you want to do you want to outpace inflation so what does that mean that means you have to put it in an account that's going to outpace so that means you're going to have to get a rate of return that's at least six to seven percent to outpace it okay right right so is that the bank no generally yeah
Speaker: Hold on.
Speaker: Hold on.
Speaker: Hold on.
Speaker: Hold on.
Speaker: It's not the bank.
Speaker: But we think we should put our money in the bank.
Speaker: Why shouldn't we put our money in the bank?
Speaker: Okay, why?
Speaker: Why do you put your money in the bank?
Speaker: Because it's safe, right?
Speaker: Okay.
Speaker: It's safe.
Speaker: That's the number one
Speaker: rule of thumb is it's safe.
Speaker: And that's what people mostly know.
Speaker: They don't know about other things.
Speaker: So it's really just they don't know.
Speaker: They don't know.
Speaker: They haven't sat down with a financial planner or a professional.
Speaker: And a lot of people don't do that because they think it costs money.
Speaker: Right.
Speaker: But there are financial professionals like me, anyone in my company, we don't charge.
Speaker: Yeah.
Speaker: Oh,
Speaker: My old firm, we did, you know, so it's just seeking information and we do financial literacy classes.
Speaker: So, you know, you just have to kind of get out there and, you know, I'll share my information later, but it is just because people don't know.
Speaker: I mean, the bank is,
Speaker: Hey, I have money in the bank.
Speaker: I'm not saying don't bank because the bank is it's liquid.
Speaker: You need money.
Speaker: If you need money right away, you put in the bank.
Speaker: Right.
Speaker: And you need an emergency fund at the bank.
Speaker: So any other investment is not going to be liquid.
Speaker: A lot of them are.
Speaker: But if you have access to the you know, you have to have maybe six to six.
Speaker: I recommend six months at least of savings for an emergency fund.
Speaker: Okay, six months of savings for emergency fund.
Speaker: At least.
Speaker: At least.
Speaker: It depends on your, everyone is different.
Speaker: So six to 12 months, you know, I mean, look, the pandemic happened and a lot of people were unable to work, you know, so were you saved up for that, you know, so things happen.
Speaker: Yeah.
Speaker: Absolutely.
Speaker: So, you know, take it back to the bank.
Speaker: So you said, yeah, we all have our money in some type of bank.
Speaker: But outside of the bank, if I have some some liquid, some cash that I want to kind of invest somewhere.
Speaker: Money that even it's secure or I know I can get some type of return on it.
Speaker: Right.
Speaker: Okay.
Speaker: So great question.
Speaker: If you're young, I mean, I assess this.
Speaker: I say, what's your risk tolerance?
Speaker: One, like, are you comfortable losing money?
Speaker: Because a lot of investments are high risk, right?
Speaker: So you have your stocks, you have now crypto, you have EFTs.
Speaker: Those are high risk.
Speaker: Those are gambles because you don't have guarantees on that.
Speaker: Then you have index accounts, which you do have guarantees on.
Speaker: right so index accounts could be through a life insurance policy it could be through an annuity um but there are stipulations there are you know there are certain things that you have to qualify for right but what is the index account because
Speaker: At least where I was raised in words, you know, frightens some people because they don't understand the terminology.
Speaker: Right.
Speaker: Well, like we know the stock market where you can invest in stocks and stuff on a S&P 5,500, I believe.
Speaker: But what is a...
Speaker: What is this?
Speaker: What is an index?
Speaker: Okay, so an index fund.
Speaker: So I helped you with an index fund, right?
Speaker: Okay.
Speaker: It can be through maybe a life insurance policy.
Speaker: It's called an index universal life.
Speaker: Right.
Speaker: What I got, right?
Speaker: You got that.
Speaker: It's a permanent life insurance policy, but it's also, there's two parts of it.
Speaker: There's almost like a savings plan in there that can grow.
Speaker: And it's guaranteed, I mean, there's no loss.
Speaker: There won't be any loss for you.
Speaker: It mirrors the market.
Speaker: versus it plays in the market, right?
Speaker: So it's just mirroring the market.
Speaker: And what I mean by that is that there's a floor.
Speaker: So there's a floor, meaning you're not going to lose any money.
Speaker: And then there's a cap rate, meaning if the market goes up maybe 30%, you're capped at maybe 15%.
Speaker: So yeah, that's what an index account looks like.
Speaker: So that's if someone doesn't want any risk.
Speaker: Okay, so that's more like a neutral conservative?
Speaker: Like, that's more like no risk.
Speaker: Yeah, you're conservative with your money.
Speaker: You don't want any loss.
Speaker: You don't want any loss.
Speaker: And it's also life insurance.
Speaker: It's also great because you have that life insurance aspect of it as well.
Speaker: And a lot of people, you know, we can get into this, you know, like at another time with more details on life insurance.
Speaker: But life insurance can act as a supplemental retirement fund as well.
Speaker: Well, let's talk about it now because that's what I have with you.
Speaker: So let's unpack that.
Speaker: So to the people listening, so what about a life insurance policy that you can add supplement income?
Speaker: Can you break that down so people understand?
Speaker: Yes.
Speaker: So a lot of people think life insurance is just if I die, I'm going to get money, right?
Speaker: Not the case.
Speaker: That's called term insurance.
Speaker: That's called term life insurance.
Speaker: There is a expiration date.
Speaker: So think of it as car insurance, right?
Speaker: It only is going to come into play for you if something happens, if you get in an accident.
Speaker: So with term insurance, it's only going to pay out if you die, right?
Speaker: Right.
Speaker: Okay.
Speaker: So that's term insurance.
Speaker: That's term.
Speaker: And there's a term.
Speaker: So it's either 10 years, 20 years, 25 to 30.
Speaker: Right.
Speaker: Most people do term.
Speaker: I'll say that.
Speaker: Okay.
Speaker: A lot of people don't know about the other options and term is the, you know, when people think of life insurance, they think of that.
Speaker: But the problem with that is, or I should say, you know, an issue can come up is that you get it.
Speaker: Let's say you're, you know, how old are you, Eric? 34.
Speaker: 34, right?
Speaker: You do 30 years at the most.
Speaker: At 64, you're not going to have any life insurance, right?
Speaker: Right.
Speaker: So it expired and you paid all that money into a life insurance policy and you don't, and you outlived it.
Speaker: And you outlived it.
Speaker: Right?
Speaker: Wow.
Speaker: So from the last time I, I checked statistics show that only 2% of term life insurance policies get paid out because most people outlive their insurance.
Speaker: Hmm.
Speaker: Okay.
Speaker: So you spent all that money and then you don't get nothing out of it.
Speaker: And it could have been like, let's say it was cheap.
Speaker: It was like $20, $50 a month, but still 50 times, 12 times, you know, how many years?
Speaker: Yes.
Speaker: Money.
Speaker: Yeah.
Speaker: So then there's whole life insurance, there's index universal life insurance.
Speaker: So let's talk about index universal life because that's what you have.
Speaker: So index universal life is kind of like a hybrid, right?
Speaker: So it has the permanent or the death benefit.
Speaker: So that's what your, whoever your family is gonna get when something happens.
Speaker: Yeah.
Speaker: and a savings plan it can be so it's like two buckets right so depending on your age depending on your health you know there's so many factors in it the underwriting goes through um you're going to your premium is going to go some of it's going to go into the cost of insurance and the other is going to go into that other bucket that savings bucket and in that that's
Speaker: basically your cash, right?
Speaker: So that's like, it's called, you know, eventually, you're gonna have cash value, it's gonna grow in the market, but it's gonna mirror the market, like I said, because it's an indexed account.
Speaker: And you're going to be able to save money in there at a certain rate of return, right?
Speaker: And it's gonna depend on the market, but it's not
Speaker: invested in the market, if that makes sense.
Speaker: So say, for instance, because this year, you know, the market is a little off.
Speaker: Let's say we have a good year, right?
Speaker: The market was great in 2020, right?
Speaker: Right.
Speaker: You say it does well in.
Speaker: Right.
Speaker: And so how much more can I make off if we if the market does well?
Speaker: Is it like six percent, seven percent?
Speaker: So it averages out.
Speaker: So every year it's so keep in mind, it's a long term plan.
Speaker: Yeah, it's a long term plan.
Speaker: You're not going to get you're not going to make money next year.
Speaker: Right.
Speaker: So you want to leave it in there for like at least 10 to 15 years if you're going to access that money.
Speaker: So through the years, it's going to average out.
Speaker: So 2020 was a great year.
Speaker: This year hasn't been great.
Speaker: It's going to like an average.
Speaker: But either or, I'm not going to lose no money that I'm giving to the market if it goes low, is what you're saying.
Speaker: Like, I'm not going to lose all my money.
Speaker: You're always going to have that floor that I spoke about.
Speaker: So even if the market crashes, you're going to still have what you have in there.
Speaker: Got it.
Speaker: Yeah.
Speaker: Okay.
Speaker: So that's the market goes up 50% though.
Speaker: So this is what the cap rate is.
Speaker: If it goes up 50%, you're not going to capture 50.
Speaker: You're going to capture the cap rate, whatever that plan is.
Speaker: Like everything's different.
Speaker: You know, every plan is different.
Speaker: So whatever you say your cap rate is within your plan of your universal life.
Speaker: There's a limit to what you can capture.
Speaker: So you can't capture the whole 30.
Speaker: You're going to maybe get 15.
Speaker: Okay.
Speaker: Okay.
Speaker: But on an average, you're going to get more than what you might get at a bank.
Speaker: You know, I mean, definitely.
Speaker: Yeah.
Speaker: Yeah.
Speaker: Because right now it's like point zero going to make 30 cents.
Speaker: That's Chase every month, you know, on your money.
Speaker: So, yeah.
Speaker: That makes sense.
Speaker: So basically you're saying, do you recommend that everybody should have universal life insurance?
Speaker: Do you think it's a much higher index universal life?
Speaker: So they're, you know, not everyone can qualify.
Speaker: Okay, so what's the qualifications?
Speaker: Health.
Speaker: Health is number one because it's a life insurance policy, right?
Speaker: You're a healthy guy.
Speaker: You're qualified.
Speaker: Or certain health issues, maybe age.
Speaker: Not everyone.
Speaker: I mean, if you're older, your health is more at risk, right?
Speaker: What else?
Speaker: Income, you have to be able to afford it.
Speaker: Yes.
Speaker: So that's another... What's the minimum to get into that?
Speaker: Sorry, you cut out a little bit.
Speaker: you froze so what i'm sorry i said what's the what's the income you need to generate to kind of like at the least to kind of be a part of the discussion to even invest your money it varies i mean if you're young you can get something for 50 a month you know if you're really young because if you're older your health is you know your mortality is is different so you're or you're
Speaker: to be more expensive.
Speaker: I should say your cost of insurance is more expensive as every year goes by.
Speaker: So a lot of people, you know, I encourage when you have a newborn baby to get them because and it's a lot of people can't wrap their brain around having life insurance on their child but it's a savings plan.
Speaker: By the time they're 18 they could have
Speaker: you know depending on how they fund the account it could be fifty thousand dollars and this is the best thing about it is it's tax free it grows free yeah yeah tax shelter because it's under the tax code of a life insurance policy so it's a 7702 irs code got it yeah
Speaker: So basically, everyone has, you say everyone has whole life insurance, right?
Speaker: What do you mean by everyone?
Speaker: I'm talking about saying, you said when you get life insurance, the number one insurance that you use.
Speaker: Term.
Speaker: Term.
Speaker: A lot of people have term.
Speaker: Everybody has term.
Speaker: But the thing with term, it only, on the back end of it, usually 2% of people get paid out, right?
Speaker: You're saying?
Speaker: Well, a lot of people outlive it.
Speaker: They outlive their term.
Speaker: Right.
Speaker: Okay.
Speaker: So then they don't even get no benefits of the money they was invested.
Speaker: And they've already paid out all that money.
Speaker: They don't get it back.
Speaker: Just like car insurance.
Speaker: You only use it.
Speaker: You only get it or it's only beneficial when an accident happens.
Speaker: Right.
Speaker: Right.
Speaker: Like what else?
Speaker: Right.
Speaker: Right.
Speaker: So then, but universal life insurance, you can potentially make money if you qualify.
Speaker: Right.
Speaker: Well, you have to qualify for both.
Speaker: Okay.
Speaker: Even term.
Speaker: got to qualify for life insurance in general yes got it yes okay yes but so at what age should people think about universal life insurance so it's oh so there's there is universal but this is an index universal life i mean any like age really if you can qualify so it depends i mean even if even if you're in your 50s 60s you can it's just more expensive
Speaker: Yeah, because the thing I want people to kind of take in and listen to is like, where should I put my money?
Speaker: If I have $5,000 right now, right?
Speaker: I always had this idea.
Speaker: I do it every year.
Speaker: Like I save $100 a week, right?
Speaker: It's 52 weeks in a year.
Speaker: So I end up with $5,200, right?
Speaker: Right.
Speaker: not a lot of money but it's enough yes where where should I put this money like oh I want to go to stock market I want to go to crypto but this is all coming from what I think right not what I know right so I'm trying to understand from your perspective
Speaker: to make more money and I don't have to make it right now.
Speaker: I can make it 10 years from now.
Speaker: Right.
Speaker: So, right.
Speaker: So in your case, so everyone's different, obviously you want to diversify.
Speaker: That's like the key word.
Speaker: Everyone says you have to diversify.
Speaker: You have to fund maybe the short term.
Speaker: So I like to say you need a short term, midterm and longterm.
Speaker: fund, right, or plan, right?
Speaker: So short term is one to five years, midterm would be, you know, after that five to 10 years or five to seven years, and then 10 to 15 years is a long term plan, right?
Speaker: So that's a retirement plan, at least.
Speaker: You have fund each one,
Speaker: You want to fund the first one first because the emergency plan is probably the most important.
Speaker: You need to be able to, you know, have that fund already in place and then you have extra money to diversify into maybe five to seven is like a mutual fund, right?
Speaker: Yeah, okay.
Speaker: Five to seven is a mutual fund, okay.
Speaker: It could be like a mutual fund.
Speaker: Your money is still accessible, but it's going to grow.
Speaker: And it's not so risky as much as a stock, right?
Speaker: So do you, a mutual fund is a group of stocks.
Speaker: Okay.
Speaker: So, um,
Speaker: So you can have one stock might go down, one stock might go up.
Speaker: So then you get the average.
Speaker: So it's not as risky.
Speaker: Mutual funds.
Speaker: Yes.
Speaker: Mutual funds.
Speaker: And then and that's that's great if you don't have a lot of money, you know, to invest because you can maybe put one hundred dollars a month into a mutual fund.
Speaker: Oh, hold on.
Speaker: Y'all hear that?
Speaker: Yeah.
Speaker: I mean, you don't.
Speaker: Right.
Speaker: You don't even need.
Speaker: There's no minimum is what I'm saying.
Speaker: No.
Speaker: Yeah.
Speaker: Certain companies.
Speaker: have minimum so i should say that um and then you have five to ten or no sorry ten to whatever in a long-term plan and that's retirement that might be the index universal life policy that might be a 401k or you know that type of fun you know yeah you can't access it right now so it's locked up
Speaker: Got it.
Speaker: So let's move into like, so we know that the mutual fund is more like, that's what five to seven years you were saying?
Speaker: So that could be a goal of like, let's say you want to buy a house, you know, in the next near future, but not right away.
Speaker: Right.
Speaker: Okay.
Speaker: So mutual funds, I will invest my money in that.
Speaker: And then universal life insurance, right?
Speaker: It's more long term, correct?
Speaker: Yes.
Speaker: Got it.
Speaker: So the next question.
Speaker: It's a retirement plan.
Speaker: It's a retirement plan.
Speaker: So you want some type of mutual fund if you can, and you want a retirement plan.
Speaker: Or you can do also variable to index annuities.
Speaker: There's so many other options.
Speaker: I just want to keep it simple for the people.
Speaker: I don't want to overwhelm them.
Speaker: I just want to give them stuff that they can like.
Speaker: So let's talk about 401ks because a lot of people have invested in that 401k from a job, corporation, company.
Speaker: I remember working at Abercrombie & Fitch and they were like back in my 401k 50% after a year working, you get the benefits.
Speaker: How do you maximize a 401k?
Speaker: Can you maximize a 401k?
Speaker: How does that work?
Speaker: You can.
Speaker: So it depends.
Speaker: A company will match you.
Speaker: Right?
Speaker: Yeah, a lot of people don't or a lot of companies don't.
Speaker: But let's just say they match you 3%.
Speaker: That's kind of like the general rule.
Speaker: So I would only do 3% because you're getting money on your return.
Speaker: So it's like 100% match, right?
Speaker: So you put 3% in, they're matching you.
Speaker: So that's, that's great.
Speaker: Yeah.
Speaker: Um, caveat would be,
Speaker: it's a retirement fund so you can't touch it till you're 59 and a half yeah okay or there's penalties you can but there's going to be penalties and then it's also tax deferred right you haven't paid taxes they're deferred you might have saved some on taxes but in the end when you start withdrawing it that's when it's taxed got it yeah i've been every four
Speaker: Text me, baby.
Speaker: Right.
Speaker: But it's the lump sum, right?
Speaker: So that's, it's like your nest egg.
Speaker: So you're going to get texts on the nest.
Speaker: So,
Speaker: you're probably going to save let's just hypothetically say 50 50 000 in taxes but when the lump sum is there let's just say it's like 500 000 now you're now being taxed on it so you're going to probably lose 300 000 depending on your tax bracket yeah jesus yes so uncle sam wants their money at the end right so they're going to take their money
Speaker: Yeah, so a lot of people don't know.
Speaker: And you know, honestly, I sit down with so many clients and they don't know how to 401k and quite honestly, I didn't either back in the day, you know, so to, you know, get it explained that way, you know, wouldn't you rather just save on taxes and maybe put your money into something that's beneficial and it has a tax shelter.
Speaker: So we kind of show that.
Speaker: Yeah, so we got universal life insurance, retirement.
Speaker: We got mutual funds for the short term.
Speaker: Yeah.
Speaker: We have 401ks that people, most people can relate to or understand.
Speaker: Right.
Speaker: But can we talk about a Roth IRA and the benefits of having a Roth IRA?
Speaker: I have a Roth IRA.
Speaker: Okay.
Speaker: Okay.
Speaker: three years is to put 500 a month to go in.
Speaker: Because you only can, you only can, I think it's the max.
Speaker: 6,000.
Speaker: 6,000?
Speaker: Yeah, you only can put 6,000 a year.
Speaker: But what's the benefits of a Roth over a 401k?
Speaker: Well, not everyone can qualify for a Roth.
Speaker: Oh, that's qualifications for the Roth?
Speaker: No, not everyone can qualify for a Roth.
Speaker: I thought anyone can have a Roth, no?
Speaker: No, if you make too much money,
Speaker: You can't have a Roth.
Speaker: So there are rules to a Roth.
Speaker: A Roth's great if you can get it.
Speaker: You maximize it.
Speaker: It's $6,000 a month.
Speaker: There is that income.
Speaker: What, a year you mean?
Speaker: $6,000 a year?
Speaker: No, it's $6,000 a year.
Speaker: Or you can do $500 a month, right?
Speaker: Right, right, right.
Speaker: I would say do $500 a month.
Speaker: Right.
Speaker: Because then you...
Speaker: the benefit of dollar cost averaging.
Speaker: That's what it's called if you do it that way because then let's just say, because the Roth is in the market, right?
Speaker: So if you do $6,000 in one month or let's say in one payment, the next day the market crashes.
Speaker: Oh yeah, you told me that.
Speaker: You actually told me that.
Speaker: Yes.
Speaker: So it's better to fund it monthly.
Speaker: Yeah.
Speaker: Yes.
Speaker: I was like, what if I can put $5,000?
Speaker: He's like, oh no, no, you don't want to do that because we're going to go sales tomorrow.
Speaker: I didn't know that.
Speaker: I'm thinking, well, I got all this money.
Speaker: And it's interesting because I tell people, the reason I wanted people to do the challenge, because I know if you can save $250 in 10 weeks, you can put $25 to $50 a month.
Speaker: in a Roth IRA because I started saving $50 a month when I wasn't barely making any money.
Speaker: Right.
Speaker: But I was building my habits of being consistent.
Speaker: Right.
Speaker: With the Roth IRA.
Speaker: Right.
Speaker: And you hit it right there.
Speaker: You hit it on the head.
Speaker: It's habits.
Speaker: It's habits.
Speaker: Like you have to get into those habits of saving and investing and then just, you know, learning.
Speaker: You have to be open to learning the ways of like fun.
Speaker: If you want to make money or money on your money, you have to learn and you have to read books.
Speaker: You have to go to classes or just
Speaker: You got to be patient.
Speaker: What?
Speaker: You have to be patient too, I've learned.
Speaker: Oh, yeah.
Speaker: You have to be patient.
Speaker: There's no, you know, I mean, yes, if you gamble, that's a different situation.
Speaker: You can make money, but it's a gamble, right?
Speaker: It's high risk.
Speaker: And if you can afford to gamble, that's like crypto, stocks, NFTs, all this other stuff that's going on, which, you know, I'm not, you know, I'm not saying anything bad about it.
Speaker: I'm just saying there are gambles.
Speaker: Gambles, right.
Speaker: Yeah.
Speaker: And you got to know what you're gambling on.
Speaker: Exactly.
Speaker: So, you know, Roth IRA.
Speaker: So Roth, I will say, is tax-free.
Speaker: So that's a major great thing about it.
Speaker: It is going to be tax-free when you withdraw from it.
Speaker: It's different than a traditional IRA.
Speaker: So, right?
Speaker: Right.
Speaker: So, so Ross, people, you hear that?
Speaker: Look up a Roth IRA.
Speaker: Yeah.
Speaker: Google it.
Speaker: Do some research.
Speaker: Yeah.
Speaker: So, you know, we talked about, like, the universal life insurance, mutual funds, 401ks, Roth IRA.
Speaker: Let's get into the discussion of the wealthy.
Speaker: Where do the wealthy put their money?
Speaker: How are they making money?
Speaker: Like, what?
Speaker: Okay.
Speaker: It depends.
Speaker: It depends on the individual.
Speaker: But I will say...
Speaker: We have the like, let's just say the Rockefellers of the world and Warren Buffets of the world.
Speaker: They do believe in life insurance because it is a tool to pass on generational wealth.
Speaker: Okay, I like that.
Speaker: Right?
Speaker: So they have used that and that is what we educate people on.
Speaker: And that is one of the ways the wealthy do it.
Speaker: You know, obviously there are so many other ways, but that's a major part of it.
Speaker: And what's the average age that people start opening up life insurance policies from that world?
Speaker: I would say the wealth.
Speaker: If you have a wealthy dad and mom who's maybe in their 60s, their son is, what, 17?
Speaker: Maybe they get them invested at 19.
Speaker: When does that really start for them?
Speaker: Or is it when they're kids?
Speaker: How do they set their family up?
Speaker: Yeah, it can be when they're newborn.
Speaker: Newborn.
Speaker: Yeah.
Speaker: I have encouraged a lot of my clients to just, hey, start a newborn.
Speaker: And quite honestly, I have kids, you know, and I had wished I had known back then.
Speaker: They have their own policies, but I wish I started them sooner, you know, because then they have this account growing when, and they have access to tax-free money.
Speaker: Like they could have, you know, had all this money by the time they're 18 or to even pay for their own college or whatever it is.
Speaker: Yeah, because I have clients who been saving.
Speaker: I have a client, his dad's been saving money since he was a baby.
Speaker: And now he's 18.
Speaker: He's.
Speaker: You know, like the tuition is already paid for because over this span of 18 years.
Speaker: Yeah.
Speaker: He's been investing in his fund for his child.
Speaker: Right.
Speaker: And I think that's the importance of having
Speaker: a Roth IRA, a savings account, an investment account.
Speaker: Yeah, you want to put the money, but it builds like the mentality, right?
Speaker: To be disciplined over time.
Speaker: And then when you build that discipline, you're able to kind of have more discipline within yourself with your money.
Speaker: Right.
Speaker: I say $50 a month, so not a lot of money.
Speaker: But if I do it for five years, you do the math.
Speaker: Now I know, oh, I've did this for five years.
Speaker: Now I know I can do a thousand a month.
Speaker: Right.
Speaker: Exactly.
Speaker: My income increases because I'm building the habits.
Speaker: And that's what I want to teach people is building healthy habits around financial literacy, around their relationship with money.
Speaker: Because, you know, growing up in the inner city of Baltimore, we want everything quick, quick, quick, because, you know, scarcity mindset.
Speaker: You grew up in poverty.
Speaker: You don't really understand it.
Speaker: You don't know it.
Speaker: It doesn't make sense.
Speaker: So, you know, when people don't have information, they just do what they think or what they're told, you know, and sometimes the parents don't have the information.
Speaker: And that's why it's people like you who helped me understand.
Speaker: Like, I think, like, two years or a year before, you know,
Speaker: I wanted to go invest in some property back home in Baltimore.
Speaker: All the books you gave me helped me not only improve my credit score, but also understand how money works and what I need to do to kind of benefit myself on paper.
Speaker: Oh, I'm glad.
Speaker: Yeah.
Speaker: And in the market.
Speaker: And so it's like it's the little things that I want people to understand, take from this.
Speaker: There's several camps you can invest in, you know, but we must, we must start early.
Speaker: I really want to bring the collective together because we live in this world.
Speaker: It's all about the individual.
Speaker: Oh, I've got all these followers.
Speaker: I got all this fame.
Speaker: I got all this money.
Speaker: I have all this success.
Speaker: But if we can't, just say, Vincent, you and I, and say, you know, Annalisa, you know, I know you're in business with this.
Speaker: Say you want to build our own bank, right?
Speaker: A digital bank.
Speaker: Just say it.
Speaker: And say your company wants to back it, but they're solid partners.
Speaker: Right.
Speaker: I want people to come together and say, listen, I don't have 5,000 to invest, but I have 500.
Speaker: Okay, cool.
Speaker: The pot might be 10,000.
Speaker: We'll take your 500.
Speaker: We'll take your 1500.
Speaker: But together, some way, somehow based on percentages, we can make money.
Speaker: I think it's important for people to get life insurance, like you said.
Speaker: I think if your company or if you know of any courses, books,
Speaker: um information from a that people can go utilize right now yeah i would love for you to mention that and really really explain to people what financial literacy is because it's such a general uh name and topic that we don't really understand to be honest right so yeah there's so much information out there you have to just be open to learning um one thing i can it's an easy read it's called how money works
Speaker: super easy.
Speaker: That's a great book.
Speaker: Also, I think I think I think I gave that to you.
Speaker: And then also, what's another one?
Speaker: It's called let me look it up.
Speaker: Sorry, I just had a like a work.
Speaker: It's called retirement planning.
Speaker: Of course, like, I had it on the tip of my tongue.
Speaker: And now I have to look for it.
Speaker: Um, it's by Patrick Kelly.
Speaker: Okay.
Speaker: It's called retirement planning.
Speaker: Here, let me, no, I can't touch my, um, it's fine.
Speaker: Retirement planning.
Speaker: It's it, that's in the title retirement planning by Patrick Kelly.
Speaker: Funny works.
Speaker: Easy read.
Speaker: It talks about a lot of concepts.
Speaker: A lot of people need to, you know, really focus on, um, compound interest, you know, just certain terms that people need to learn.
Speaker: And what is compound interest?
Speaker: Because I think it's very important that people know what compound interest is.
Speaker: It's really simple to break it down, but I want to hear from you.
Speaker: Okay, so compound interest is basically, okay, I don't want to mess this up because it's a formula, right?
Speaker: It's a formula.
Speaker: It's by Albert Einstein.
Speaker: Basically, you take the amount of, you know, your investment or whatever money you have for it,
Speaker: basically the interest rate for it to double.
Speaker: So it calculates that, right?
Speaker: So we have to, let me, hold on one second.
Speaker: I don't wanna mess it up.
Speaker: No, it's fine.
Speaker: So hold on one second.
Speaker: Cause I don't wanna give, I don't want the,
Speaker: wrong example.
Speaker: So basically, so what's your so like, for example, if you deposit $1,000 in an account, yes, 1% annual interest, it's going to only earn $10.
Speaker: Right?
Speaker: Yeah.
Speaker: So that's a simple example, right?
Speaker: purposes.
Speaker: So that's what compound interest.
Speaker: So
Speaker: Do you understand?
Speaker: Yeah.
Speaker: Yeah, for sure.
Speaker: And that's the thing.
Speaker: So with my savings challenge, with the 10 weeks, $25 a week, the goal was $250.
Speaker: And then my next step was like, okay, cool.
Speaker: Now for the next 10 months, right, just say you're going to pay 10% interest on the money you have now.
Speaker: Right.
Speaker: Actually, by teaching people how to build their own bank account, right?
Speaker: Right.
Speaker: So now 10% of $250 is what?
Speaker: $25.
Speaker: So now you're going to put, for the next year, you're going to put $25 in that bucket.
Speaker: So then now that money is going to add up.
Speaker: But all these little nuances and things I'm giving people, it's really psychological switch and shift in their paradigm, how they think about money.
Speaker: So now they know like, oh, wow, it's so simple.
Speaker: I mean, $25, I mean, I spend it at the grocery store and like... Like this.
Speaker: Think about money.
Speaker: Your credit cards have interest, right?
Speaker: Yeah.
Speaker: So most of them are like in the 20s percent.
Speaker: So all that interest is being charged on you.
Speaker: Why not putting your money into an account that you collect the interest instead of you paying out the interest?
Speaker: Yes.
Speaker: Right?
Speaker: Yeah.
Speaker: That's where compound interest comes into play, making your money work for you.
Speaker: That's exactly what it means.
Speaker: Yeah, and just building more.
Speaker: Earning, you know, interest on your money.
Speaker: Yeah, just building that money confidence.
Speaker: I think people need to have more confidence
Speaker: with their relationship with money because here's the thing.
Speaker: I have clients that are seven figures or more, right?
Speaker: And I'm asking them questions and they are also looking at their account just like someone who makes less.
Speaker: Like, oh, I just spent $2,000.
Speaker: I spent $1,500.
Speaker: Oh, I spent $5,000.
Speaker: I just spent $40,000.
Speaker: But someone in the lower tip might have just spent $2,000.
Speaker: they still have the same emotions, right?
Speaker: Or a client loses a lot of money in the stock market, it throws off their nervous system.
Speaker: So, money all has an effect on us all based
Speaker: one thing from a general space we're all affected when money is leaving our bank account when we like what happened so i just want to get people to benefit of the doubt and say listen look at these accounts you know follow annalisa get information from her and allow her to give you insights from where you can put your money you know we talk about universal life insurance mutual funds rafra r.a
Speaker: understanding the 401k tax shelters right study the rich read the books how money works retirement grow rich is a great book thinking grow rich right all these things is
Speaker: Listen, don't get caught up in, you know, saving a bunch of money.
Speaker: Just start really small.
Speaker: You know, when you're dating someone, you just don't want to get married the first date.
Speaker: Right.
Speaker: You know, I want to take you as like, you want to slowly bill.
Speaker: Okay, let's go get tea.
Speaker: Let's go get coffee.
Speaker: Let me go get lunch.
Speaker: Then after lunch, we spend a few time.
Speaker: Oh, then we can go to dinner.
Speaker: But break it down, make it easy because big steps, you know, I always say baby steps equals big walks.
Speaker: And I think it's important.
Speaker: Yes.
Speaker: I mean, hey, it doesn't hurt.
Speaker: What I really recommend is to sit down with a financial professional and it doesn't cost money.
Speaker: Right?
Speaker: They don't, a lot of people don't charge, I don't charge, my company doesn't charge.
Speaker: We will sit back with you or sit down with you and do a free consultation, financial consultation, and just kind of go over things with you, you know?
Speaker: And it never hurts to have a second opinion on anything.
Speaker: Like even if you have an advisor,
Speaker: Why not just sit down with someone for a second opinion, you know, second, third, you know, fourth opinion doesn't matter.
Speaker: And take all that information and then educate yourself and you have a better, you know, mindset and you have better information so you can
Speaker: Yeah, and you have a line to people who's helping you with your money, right?
Speaker: So books like you said all that So how do we get invested or at least get some information about how can people reach out to you is their website?
Speaker: Yeah Like where should people go and look for?
Speaker: Okay on my Instagram.
Speaker: I have a link tree so it goes to all my websites.
Speaker: So that would be great.
Speaker: So it's my Instagram I
Speaker: what is it, Annalisa.munkall, that's it.
Speaker: And then reach out to me, DM, and then we can set something up on my link tree.
Speaker: It's like different brackets of like how to learn financial literacy or, you know, schedule a 15 minute Zoom call, you know, it's like super easy.
Speaker: just to ask me questions.
Speaker: And if I don't know them, if I don't know the whole slew of people I go to, you know, with taxes, like taxes, I'm not a tax expert, you know, I'm not a CPA, but I have CPAs on my team.
Speaker: So we go to the CPA and ask those questions.
Speaker: Estate planning is a big thing.
Speaker: You know, a lot of celebrities out there, you know, you think they have their stuff together, but they don't.
Speaker: You know, Prince died.
Speaker: What is estate planning?
Speaker: What is that actually?
Speaker: What is that?
Speaker: Trust wills.
Speaker: You pass.
Speaker: Yeah.
Speaker: Your homes, whatever.
Speaker: So for instance, Prince passed away without an estate plan, without a will, without anything.
Speaker: So I don't remember the exact figures, but it was close to like $500 million.
Speaker: Damn.
Speaker: Yeah.
Speaker: What?
Speaker: And the key, you know, the sticky thing is, was he doesn't have an heir.
Speaker: He didn't have an heir, you know?
Speaker: So he didn't have, he didn't have any kids.
Speaker: He didn't have an heir for that money to go to.
Speaker: He didn't have estate planning done, which entertainers, a lot of people don't, you know?
Speaker: So that's one thing you need to do.
Speaker: Mm-hmm.
Speaker: That's the number one thing to do.
Speaker: And what's the best account someone can have to protect their money?
Speaker: Well, okay.
Speaker: So obviously it depends, but it depends on their estate, right?
Speaker: Okay.
Speaker: Yeah.
Speaker: Definitely a trust in a will is the big thing.
Speaker: So those two different things, the trust in a will.
Speaker: Totally different things.
Speaker: Okay.
Speaker: A will is just, you know, very simple.
Speaker: Trust is, let's say you have property, multiple properties, you know, you need a trust.
Speaker: Within that can come in with life insurance also, you know, like there's so many different hybrids of ways to do it, to avoid, to also avoid estate taxes.
Speaker: Hey, hey.
Speaker: I love that.
Speaker: Yeah, so people look it up.
Speaker: So many things.
Speaker: Yeah.
Speaker: So reach out to information to better your situation.
Speaker: Before we leave, it's Financial Friday, Annalisa.
Speaker: So give us a fun fact or fun tip for financial advice because it's Financial Friday.
Speaker: Leave people with to think about the benefit of them.
Speaker: Say it again, you cut out.
Speaker: What'd you say?
Speaker: I said it's Financial Friday, so I would love a financial fact or tip to help people that they can utilize for this week.
Speaker: Okay, so right now with everything going on is you need to outpace inflation and learn how to do that.
Speaker: That's one thing for sure because you're losing money if you don't.
Speaker: Right?
Speaker: Outpace inflation.
Speaker: What does that mean?
Speaker: something that is what is inflating right now it's probably 6.5% almost 7% it's gonna go up.
Speaker: So it's it's great if you can educate yourself, sit down with someone a financial professional and learn what to do.
Speaker: You know, you know, just educate yourself is the main thing.
Speaker: Educate yourself financial literacy is a huge thing that people have not done.
Speaker: And you, you'd be surprised even if they have money.
Speaker: yeah you make all this money you like yo where did my money go because i can't manage it or where do i put it right exactly people that can make it but they don't know how to manage it or invest it so that's why we need the analysis of the world and financial advisors and professionals to help us grow exactly so
Speaker: Annalisa, I just want to say thank you for your time and your insights.
Speaker: This was amazing.
Speaker: And we appreciate you.
Speaker: Everyone follow her.
Speaker: Get some financial advice.
Speaker: DM her.
Speaker: Go to her Linktree.
Speaker: Tap the Linktree.
Speaker: Look at her websites.
Speaker: And become financial savvy like she is.
Speaker: And get more insight and education to change your relationship with money.
Speaker: Exactly.
Speaker: This was good.
Speaker: Your mindset, right?
Speaker: Thank you.
Speaker: Thank you so much for having me.
Speaker: Have a good day.
Speaker: Go Utreme.
Speaker: Yes, no problem.
Speaker: You're welcome.
Speaker: And this was great.
Speaker: Thanks.
Speaker: Awesome.
Speaker: Take care.
Speaker: Okay.
Speaker: All right.
Speaker: Bye.
Speaker: See you later.
Speaker: Deep breaths.
Speaker: Deep breaths.
Speaker: That was good.
Speaker: You know what I'm saying?
Speaker: Hopefully you took something from there.
Speaker: And yeah, people, let's really get in tune with our money.
Speaker: And we all have money struggles.
Speaker: I've had them in the past, mismanaging, overspending, not understanding.
Speaker: And I've read multiple books.
Speaker: So Total Money Master the Game by Tony.
Speaker: Money is really good as well.
Speaker: Thank you Grow Rich like she said.
Speaker: But let's normalize the conversation around our financial well being because it's important and affects our mental health, our emotional health, our spiritual health and our physical health.
Speaker: So get uncomfortable to get comfortable in the money sector and
Speaker: I just want you guys to do better, and you will when you get the information.
Speaker: Have a good one.
Speaker: Another Bigger Talks, IG Live Edition.
Speaker: Subscribe for the podcast.
Speaker: Give me some feedback.
Speaker: If you liked it, comment.
Speaker: But let's get our money up, and let's learn.
Speaker: Money round.
Speaker: Peace, love, and peace.
