David Duley: Planning for Social Security Risk

David Duley, founder and CEO of PlanGap, joins Coach Pete to discuss the Social Security Risk Score and preparing for potential gaps in retirement income. This Financial Safari conversation was recorded in December 2023. Call 800-661-7383 or text PLAN to 600-700. Transcript Automatically transcribed from this episode; timestamps are approximate. 00:00 Well, folks, this is the time of the show where we go out across the world and find someone I think who's making a difference in the financial world. And today is no exception. We have David Dooley, who's the founder and CEO of PlanGap and Social Security Risk Score. Folks, when you get close to retirement, you start thinking about Social Security, and then you start thinking about how you can get your most bang for your buck and make sure you're doing the right thing. And I think David's in a really good niche right now because a lot of folks that I talk to are curious about finding out, number one, making sure they're doing the right thing when claiming Social Security, and two, making sure they're getting the best bang for their buck. Dave, welcome in. Hey, great to be here, Pete. Now, your company is located in Atlanta, Georgia. Am I correct? Yes, sir. Right down the street. I'll tell you, the last time I went to Atlanta, it's been like three or four years ago now, but I've never seen, besides Nashville, Tennessee, in the last three decades, 00:48 I've never seen so many building cranes as I have in Atlanta, Georgia. It's been crazy, and the traffic hasn't gotten better. Well, I'm 57. I'm old enough to remember when Spaghetti Junction, you were still out about 30 minutes from Atlanta, but you were close. But you were still able to go 60 or 70 miles an hour coming down the road there. Now, I heard that's where the traffic starts. That is totally true, and it keeps going for another 40 miles. Well, I guess growth is good, as growth is bad. But let's talk about what caused you to develop the company you have right now. Yeah, you know, I've been an entrepreneur all my life, and I had the fortunate luck of being born in Flint, Michigan, of all places, a place that got rid of their traffic problem because of economic malaise. 01:38 And, you know, it was the birthplace of General Motors. Watch my family and others sort of suffer as General Motors kind of went through bankruptcy and other bad stuff, and it was a thought that really no one could imagine. Right. Could General Motors ever go bankrupt? Oh, yeah. And so, you know, a few years ago, I was on a flight, and I overheard this couple talk about, you know, what's going to happen when Social Security runs out of money. Right. And as a younger guy, I never really gave much thought to Social Security, but the fear in their voice reminded me of the fear I heard growing up in Flint, right? And I just thought to myself, wow, I'm sure other people worry about what's going on with Social Security. It's kind of used as a political wedge these days. 02:23 And so what's the truth? What are some of the proposals out there? And that sort of led to the genesis of the Social Security. Social Security risk score and then also the development of products that address what happens if Social Security does, in fact, change the rules on people. Yeah. And when I hear changing rules on people, I think back in my childhood days, we used to watch Charlie Brown, and Lucy was always pulling the ball out from Charlie Brown when he was running up to kick the football. And so that's what changing the rules. It's not something we as Americans respond friendly to. No. And look, this is an election year. You've heard a lot about what's going to go on with Social Security. I mean, there's people on both sides talking about the unsustainability of it, where are the cuts going to come, what are the reform looks like, who's going to pay their fair share. 03:09 And so there's a lot of insecurity and bad information out there, and we're trying to kind of get a place where people can go to get good information. Yeah, I mean, good information, that's the key. Unbiased information, when we hear people talking about what they really want in life, especially from their financial advisor or people giving them that kind of financial advice, is people who aren't motivated by commissions to tell you to do something that isn't good for you. That's right. That's right. And so that's what people always ask, what is a fiduciary? Well, a fiduciary, number one, has to put your needs first, but also they need to do what's right. And we've been doing that forever. But, I mean, isn't it a shame, though, Dave, when we have to have government issue laws to make people do what's right? Well, completely. And what's even more of a shame, especially as it relates to Social Security, is to see how it's used as political football to wedge people into voting a certain way, 04:00 or this person's good, this person's bad. And sort of you asked sort of the genesis of the idea. I mean, wouldn't it be amazing if we could create retirement plans that weren't subject to political football and took that risk specter out of it? And so that's really why we built Plan Gap and Social Security Risk Score. And by the way, folks, we are talking to Dave Dooley, who's founder and CEO of Plan Gap and the Social Security Risk Score. Let's talk about Social Security now and the risk. How dependent are Americans on Social Security these days? You know, it's really shocking. About 90 percent of Americans, basically, if you have two, two and a half million dollars or less of retirement savings assets, Social Security income is going to play a major role in your income plan. 04:46 And you have the government talking about, wow, you know, we might run out of money in 10 years. And then there's a 25 percent cut across the board, roughly. And what that does is even for the average American that's done all the right things, saved a million bucks for retirement, they can have almost near certainty of a great retirement plan, kind of living off $100,000 a year, maybe have a 98 percent Monte Carlo success rate on that because Social Security will make up maybe 50 percent of that income, which a lot of people are shocked about. All of a sudden, if that 25 percent cut, that's the success of that retirement plan goes to a coin flip. And so what's amazing is and what we really try to do is work with people, give advisors tools that allow them to say, 05:36 wow, we think there's another risk out there. We think there's maybe policy risk, government policy risk. You know, people talk about longevity risk and other things like that. But what happens if, again, the government changes the rules and you have to adapt? And so we want Americans with good information to make good decisions today so they don't have to worry about it in the future. Yeah. Now, let's get into this. Now, the Social Security risk score, what is it and how could somebody benefit from it? Yeah. What it is, is it's sort of like a diagnostic tool. It's the first diagnostic tool that takes an individual's unique situation. So ask a little bit about them. They fill out a quiz. Then all of a sudden it says, based on your where you are financially, your age, et cetera. 06:22 This is the probability that you might be affected by Social Security reforms. Here are some of the reforms being proposed. And here's how you would match up against that. And so what's fascinating is we can just look as early as back as COVID to see means testing. Remember? Remember when COVID stimulus checks started being phased out from $75,000 up to $100,000? And a lot of people didn't receive COVID stimulus checks. That was a method of means testing. And you're already seeing politicians say, you know, we might need to means test Social Security. Unfortunately, you know, the government thinks $75,000 a year is rich. Well, the first four letters mean it all to me. It's mean. It's not good for anybody who has any money. 07:07 You don't get any money. So I see why they call it means testing. It's bad for most people listening to the show. That's right. That's right. And again, this is the first sort of blood test. Think of it as almost a credit report, which gives you your own risk factors of where you might be subject to, quote unquote, the potential fixes of Social Security. Because Social Security will be fixed one way or the other. Either they will pay less benefits, tax more, or probably do what I believe is a combination of both. But they will politically target, quote unquote, the rich to pay their fair share. Unfortunately, the definition of rich, you know, falls kind of back into that working class American that's done all the right things, but still could be subject to political football. 07:58 Yeah. When I grew up, $10,000, the $10,000 pyramid, $10,000 was a big thing. These days, it won't even get you a Yugo. I don't make Yugos anymore, but you know what I'm saying? And it's not a big amount of money anymore. Yes. So let's look at this. Now, your program, you can come up with a Social Security risk score for anyone out there, and it weighs all the different factors on what they've saved and what they could qualify for Social Security and gives them a number grade, correct? That's exactly right. And then you can work with an advisor to say, look, what do I do about this risk? Just like you would any other risk in retirement. Yes. Yes. Well, you've been generous. Well, you've shared this with us. We're going to use this software for folks what they call from this radio interview and show them what their real risk score is. Now, if somebody has a low risk score, is it correctable? 08:44 Yeah. You know, we can't necessarily change what the government might do. And so it's really showing what is the likelihood you might be affected by government, you know, fixes of Social Security. But by planning early, sort of planning now, you can take the impact of those changes away, right? So if you wait until the last minute, it's sort of like walking between a balance beam. Easy to do if it's one foot off the ground, right? And you have a 10% chance of failure. But if you put that balance beam across skyscrapers, then, you know, you might not be so willing to take that chance. I've seen those old pictures of the guys who were building the skyscrapers and they were balancing on one beam. I don't know how they did it. That was a real balance beam right there. That was a real balance beam. And so, again, what we want to do is say, hey, here's where your risk exposure might be. 09:33 Let's talk about that today so we don't wait until the last minute and put your, you know, hard work retirement plan in peril. Let's say someone's listening and they've got about, or they're 55 years old, let's say, and they've got about $500,000 saved for retirement. And they're starting to think about, we call it the financial red zone. They're starting to think about what's going to happen next. What's going to happen when they reproach retirement and how do they claim Social Security and how do they make sure they have the right money? Is that too soon for someone at age 55 to do the Social Security risk score? No. In fact, that's right in the sweet spot. Because what's going to happen, the government, frankly, is saying, we might run out of money 2033. So now that's 10 years out. That person, that 55-year-old, is now 65. So they're in the Social Security claiming zone. 10:19 Now their full retirement age will be 67. But as you know, they can claim it as early as 62 and up to age 70. And so what the risk score does is sort of gives them maybe a future look on, is that promised amount of money actually going to be there for me in full? And if not, what can I do today to shore up the retirement income needs that I have for the future? Well, it just makes a lot of sense. Dave, we really appreciate your time. We're going to give the number out in a minute for folks to get your own Social Security risk score done. But Dave, I just wanted to make sure we express our gratitude for you coming on and expressing or showing us what your program is all about. Well, thank you. And thank you for letting people know. I think they'll find a ton of value out of taking it. I really appreciate your time today. Thank you, Pete. 11:04 Take care. So, Thomas, before we go to break, I just want to make sure everyone knows the power of this. I mean, you can see ahead of time where the deficiencies are in your portfolio and make corrections before it's too late. It's never too soon to get started right here. Thomas, let's open it. We got the software. I mean, Dave's been generous enough to share it with us just for a couple months. And it's going to cost a lot of money. But we're going to use it here for the next 40 people who call. Let's make it for 40 people. Let them see what's really going to happen. It's a great opportunity. Real Social Security risk score. Let's open his phone lines up. Make sure we have a bunch of people ready to answer the phones. All right. 800-661-7383 is the number to call. 800-661-7383. You can also connect with us. Start this process by texting keyword PLAN to 600-700. PLAN to 600-700.