Where Financial Plans Fall Apart.

In this episode of "More Living with Jim Brogan," Jim Brogan discusses four critical areas where retirement financial plans can fail: insurance coverage, beneficiary designations and asset titling, fraud and scam prevention, and emergency fund management. He explains how overlooked details in these areas can undermine decades of planning, and offers practical advice on regular insurance reviews, updating estate documents, protecting against scams, and maintaining a robust emergency fund. The episode emphasizes proactive, ongoing management as key to securing financial independence and peace of mind in retirement. Transcription: Jim Brogan 00:00:02 You're tuned into more Living with Jim Brogan, broadcast live from the Brogan Financial studios at Newstalk 98 seven, where old fashioned values, expert knowledge and genuine understanding come together to give you the retirement straight talk you deserve. Jim's a former National Advisor of the year recipient and a financial educator, and he's here today to talk about how you can live out the best years of your life. Jim and the Brogan financial team have been helping retirees and retirees across the southeast for over 20 years in their pursuit of financial independence. You can reach them during the week at 865862 6800. So sit back, relax and get ready to learn, because more living with Jim Brogan starts now. Speaker 2 00:00:45 Hello East Tennessee, welcome to More Living with Jim Brogan, where it's all about living the best years of your life, your ways. You listen to Newstalk 98 seven, woke. Speaker 3 00:00:56 Up and you know you've worked hard to build your financial foundation. saving for retirement, building wealth, planning for the future. But all that progress can be undone by avoidable mistakes, from whether it's inadequate insurance coverages to outdated beneficiary designations, from sophisticated scams targeting retirees to emergency funds that aren't quite adequate for today's challenges. Speaker 3 00:01:23 These gaps in your financial plan that are often overlooked can derail decades of careful work. Now, the good news is, most of these problems are preventable with the right knowledge and proactive planning. And so today, we're discussing four critical areas where even well-planned finances can fall apart. Insurance coverages, beneficiary designations and how we title our assets. Fraud and scam prevention and how we started. How we handle our emergency fund. So let's dive into to how to protect the plan that you work so hard to build. We'll ask. We'll answer common questions about protecting your financial plan, and we'll discuss solutions to help you avoid the mistakes that can derail even the best laid plans. So let's start with an insurance review and and covering, or closing your coverage gaps before they end up costing you. You know, insurance is one of those things we all have, but few of us really review it regularly. You know, we set it and forget it, and we hope we never need it. You know, we don't hope to have a claim on our homeowners insurance as an example. Speaker 3 00:02:41 however, insurance markets have changed dramatically in recent years. And what worked for you five years ago or even last year for that matter, may no longer provide adequate protection. You know, we see soaring premiums. There are expiring subsidies in terms of the ACA, the Affordable Care Act, or the Obamacare as it's commonly called, and their coverage gaps many don't know exist. Today's insurance landscape does need your attention. So let's let's discuss today. While reviewing your insurance coverage is critical in 2026. So first off, let's talk about health insurance. The enhanced Affordable Care Act subsidies expired at the end of 2025, and average premiums more than doubled from just under $900 a month to over $1,900 per month. For people that are receiving a government subsidy. About 7.3 million people are expected to drop their ACA coverage that they get in the marketplace. 5 million people will likely go uninsured rather than find coverage somewhere else, and young, healthy people dropping coverage creates a potential death spiral for the marketplace. I mean, think about this. Speaker 3 00:04:07 It's often younger, healthier people that that drop their coverage and that makes it, you know, the the older and more sick a population is that's being covered for insurance, the higher those costs are. You know, insurance is about the law of large numbers. When you start taking out younger, healthier people, it's completely changes that dynamic. And then when you have more people going off of insurance, then we have more people uninsured that go into emergency rooms, that have accidents, that have things that come up, and ultimately that creates stress on our health care system. Now other insurances are rising. auto insurance premiums were up 12% in 2025, and that was more than 50% higher than they were in 2020. So in five short years, auto insurance has gone up over 50%. Full coverage auto insurance increased for the average household almost $2,700 a month a year. Excuse me? 47% of homeowners reported a premium increase in 2025. And rate increases are happening at really a record pace. things we haven't really seen in decades. Speaker 3 00:05:35 So, you know, health insurance. Let's start with health insurance premiums. Health insurance premiums for employer coverage reached $27,000 for family coverage $27,000 a year. So that's pretty dang high. nearly 30% of policyholders switch carriers in the past five years. A comparison shopping allows an apples to apples policy comparison now. You know, if you're working for an employer. Most people, they're covered for through their health insurance, you know, through their employer. And so you don't have a lot of control over those things. Now, if you do have control, you should absolutely be shopping your health insurance on a regular basis. You should also look at payment options. You know, sometimes paying for your premium annually instead of monthly can yield some pretty deep discounts. but we have to also understand where policies exclude things. you know, Medicare doesn't cover everything. that's a very common thing. most people cover their gaps with either a medigap plan or Medicare Advantage plan. So we get that people get supplements and there are still holes depending on which supplement you get. Speaker 3 00:07:01 You know, travel insurance. Many, many people buy travel insurance, especially when they you know, we have a lot of clients that go on overseas trips, go on river cruises in Europe, things like that, and travel insurance. There are a lot of it has a lot of exclusions that people don't really understand. So it it's critically important if we're going to pay for insurance to understand what we're paying for. You know, long term care insurance has become more and more expensive. And in many cases it's just unavailable. So we really should be looking at all of these things and what coverage covers and what it doesn't cover. I know, you know, with things like homeowner's insurance, one thing I've learned over the last 4 or 5 years is insurers are terrified of water damage. And so there are typically limits on your coverage as what those benefits will cover if there's water damage or if there's mold and mildew damage. There are a lot of exclusions, with your auto insurance and and I'm not a licensed insurance agent for auto and homeowners. Speaker 3 00:08:17 So let's be clear here. But with your auto insurance, you know, do you have a gap in your coverage? If you buy a brand new car and you drive it off the lot, you know, it goes down $10,000 in value oftentimes, or let's say significantly, depending on, you know, how how you know, the value of the car you bought. But then if you turn around and have a significant accident, you may not have enough coverage to cover that. There could be a gap in what the insurance company thinks the car is worth versus what you just paid for it. You know, if you have significant damage to your car. Will your insurance company pay to replace parts that are made by your OEM, your original equipment manufacturer? Or are they going to use cheaper aftermarket parts? So all of these things are important, and these are all conversations you should be having with your insurance agent. What is covered? What is not covered? What limitations are there for things like flooding, water damage, all kinds of things. Speaker 3 00:09:27 So this is just really important to consider. You know, insurance provides a foundation for financial security. And when you're uninsured, a single unexpected event, whether it be a health care crisis, if it be property damage, a liability claim, you know, if you're sued, you get in a car accident or somebody gets injured at your home. It can wipe out years of savings. And when you're paying for coverage you don't need, you're wasting money that could be working harder elsewhere. So the insurance landscape has changed dramatically over the past 5 or 6 years. There have been premium increases. Changes in the subsidies under the Affordable Care Act, coverage, modifications that may have created gaps in your protection, like water damage and things like that. So, you know, you need to perform regular, comprehensive insurance reviews at least every couple of years to ensure that you have the right coverage at the right price. And honestly, every year when your insurance renews is a great time to be talking to your insurance agent, about these kind of things. Speaker 3 00:10:36 So I do want to just mention before we end this discussion about insurance, about liability, you know, let's let's talk about our car insurance in particular. You know, we have limits on our car insurance. And what if you get sued for more than that limit? you know, umbrella policies that then kick in an umbrella is like a a policy that then kicks in. If your coverage limits are not adequate enough. So, for example, you might have $1 million umbrella. And that umbrella covers liability. It covers all kinds of things in addition to damage actual damages. So a liability protection is just not that expensive. And adding that or considering adding that to your homeowner's policy is typically not very much money. So we definitely need to make sure that we have adequate insurance to protect us. If we have the the the unthinkable happen. So every year when your policies renew, talk to your insurance agent. you know, be sure you're shopping around periodically from time to time. I'm a big fan of independent agents because they can write business with multiple multiple companies. Speaker 3 00:11:50 Now, some of these captive agents that only work for one insurance company. Many of those are very good as well. So don't get me wrong, but I am a fan of independent agents that can represent multiple companies and can truly consult. Be a consultant for you in helping you through these kinds of decisions. Now we're going to get to our first break. When we come back, we're going to discuss how outdated beneficiary designations can completely derail your estate plan. We'll also talk about asset titling and understanding the way we title our assets, and what that means in our estate plan, and what it does not mean in our estate plan. So stay with us. This is Moore living with Jim Brogan right here on Newstalk 90 87W Sky. Jim Brogan 00:12:37 Welcome back to Newstalk 98 Seven's Broken Financial Studios where Jim Brogan is coming to you live with important news and advice to help you achieve your dream retirement. Get ready to learn and live. Here's your host, Jim Brogan. Speaker 2 00:12:52 Welcome back to More Living Here on Newstalk 98 seven. Speaker 2 00:12:56 It's a beautiful, beautiful weekend. Speaker 3 00:12:58 here in Knoxville, Tennessee. Let's talk about beneficiary designations and asset titling. You know, we we how we title our assets, how we name beneficiaries. we we we see horror stories every year about estate planning disasters and understanding what covers what or better yet, you know, what is your will not cover. You've taken time to create a will or trust you. Spell out exactly how you want your assets distributed and you think your estate plan is complete. But there is a silent killer lurking in many estate plans, and that's outdated beneficiary designations and improperly titled assets. You know, these seemingly minor details can completely override your carefully crafted will or your living trust, sending your assets to unintended recipients and potentially creating family conflict that lasts for years. Today, we'll explore why beneficiary designations matter so much and how to avoid some common mistakes with both beneficiary designations and how we title our assets. So it's important to understand beneficiary designations have full control and authority over who gets what for that account. Speaker 3 00:14:18 They override your will and your trust. And the most common would be our retirement accounts. When you open up a retirement account, an IRA, or a 401 at work on the account form, it asks you to name a beneficiary, and we typically don't think anything about it. We just list our spouse if we're married, and then we list our kids maybe as contingent beneficiaries. Now, one benefit of beneficiary designations is when you name a beneficiary on an account or on life insurance or, you know, anything like that. Those assets pass directly to the name beneficiaries and they bypass probate. And in many ways that is a good thing. But it does create complications because we, you know, we put a lot of legal language in our will, and that legal language is in there for a reason. It's very, very important. It covers a lot of different things, like what if people don't die in the right order? That's a very common problem we see is you name your kids as you know, your beneficiaries. Speaker 3 00:15:26 Well, what if one of them predeceased you? I mean, knock on wood, but then who gets their share of the asset? Well, you'd like to think it would go to any grandchildren you have, but in most cases it goes to the other surviving siblings. So many people come into our office and that's how they've named their beneficiaries. And if people don't die in the right order, they could end up inheriting an entire arm of the family. And then we see common errors like post-divorce retention. You know, in many cases, the ex spouses are still listed as the beneficiary, despite a divorce years ago. And this was actually tried. It was challenged in the court system and went all the way to the Supreme Court because a husband and wife had gotten a divorce and the husband changed all. He got the retirement accounts. The wife got other assets like the house and the husband. The ex-husband changed his benefit, all his wills and legal documents, but he never changed the beneficiary designation on his 401. Speaker 3 00:16:39 And years later, he died. and his ex-wife was the primary beneficiary. Now, then his daughter was the contingent beneficiary. Well, clearly the goal the plan was for him to get the retirement accounts he needed his legal planning. But the beneficiary designation listed the ex-spouse and that his daughter sued her own mother. And it went all the way to the Supreme Court, then the Supreme Court. I think it was nine to nothing. It might have been eight one, but I think it was nine to nothing. Clean sweep beneficiary designation. Beneficiary priority rules. That is the law of the land. So this is something you know what? If you get remarried, you know what? If you were in a second marriage and you have a 401 and you get remarried and you've named your kids, your kids are named as your your primary beneficiary? Well, under the law, once you're married for a year, your spouse has an automatic right to that retirement account. Under Orissa law, which governs 401 K's. Speaker 3 00:17:51 And so what that means is if you leave your kids as the beneficiary without getting a waiver from your spouse, which is what is required, then your spouse, your spouse is legally entitled to your retirement account. Okay. So that's also a very, very important thing to understand with beneficiary designations. Many people, they miss contingent beneficiaries, you know, you name primary, you don't name contingents. And if your primary beneficiary predeceased you, then your assets could end up going into probate. go into your estate and triggering potential extra taxes. If it's a retirement account, if you name a minor child directly, you know it could subject beneficiaries to costly Guardian proceedings if you name the estate as the beneficiary. It forces assets into probate, which negates probate avoidance benefits of naming beneficiaries. So all of these things are very, very critically important now. So your beneficiary designations must align with your overall estate plan. You know, a common plan is to leave assets to a spouse. And then when you're gone, leave it to a testamentary trust for minor children. Speaker 3 00:19:18 and that's a very common thing because then you can say, who's going to be over that testamentary trust. A testamentary trust is simply a trust that's created when you pass away. If it goes to a minor child and you appoint a trustee to be over that trust, and you lay out the guidelines of how the minor beneficiary can get money from the trust, whether its principal, earnings, income, whatever it is. And when you do that, it creates a lot more clarity. if you name your if you name minor children or minor grandchildren as contingent beneficiaries directly, it can create a lot of problems because the minor child typically cannot inherit that money. And so a court would then have to come in and appoint somebody to be over that money for that minor child. And so it can negate a carefully planned trust structure. Now, how we name, how we title our assets is also very, very important. Many people, many of you listening today have created a living trust. And you created that living trust with the idea that you would put your house and real property in the trust. Speaker 3 00:20:32 And by doing that, you effectively avoid probate. See the only way in Tennessee. to get assets to your kids without probate is to put it in a living trust. Now, I say that you could put your child's name on a house. and that would, if it's jointly title that would go directly to your child with no probate. The problem with that is you will have made a gift or you inside the gift. Limitations of what IRS allows without filing a estate gift return tax return. and then you've also put your child's name on your house. What if your child is in a car accident and get sued? Well, they could take your house. So there's gifting issues with that. There's also liability and exposure issues. We were talking about insurance coverages in the first segment. These are all things and risks that you can be exposed to. So you know, the only way you really shouldn't put your kids names on your house. So the only way if you don't do that, the only way to get real property to your kids without probate is to put it in living trust. Speaker 3 00:21:47 But just listing the house or the property in the name of the or in the trust document does not actually put it in the trust. And that's a very common misconception we see all the time. What matters is if I go down to the courthouse and I pull the deed to your property, which is a public record, what is the title going to be? What is it on your house? Is it? Is it Jim Brogan or is it the Jim Brogan Living Trust if it says Jim Brogan? And yet I've got this trust document that says it's in the trust. It ain't in the trust. If I go down and pull that deed to the property, if it's not titled into the trust, it is not in the trust. So again, all of these things are critically important. So beneficiary designations can override your will and trust. assets do pass directly to name beneficiaries. And that allows you to bypass probate. But they don't have nearly as much legal language. And they don't cover things like what if people die in the wrong in the wrong order? So, you know, it's a they're simple forms. Speaker 3 00:23:01 Beneficiary designations are that have enormous power, and a single outdated form can send hundreds of thousands or even millions of dollars to the wrong person, completely overriding the estate plan that you spent time and money creating. And these are not rare mistakes. These are painful surprises that families discover only after someone has passed away and it's too late to fix it. So as a financial professional, you know, our job at Broken Financial is to help clients conduct comprehensive beneficiary designation reviews. Make sure that they do line up with the with the legal instructions and wills and trust to ensure every account aligns with your overall estate planning. So whether you're you've experienced a divorce, a remarriage, a birth of a child, or you simply haven't reviewed these beneficiary designations in years, we can help you avoid the mistakes that can derail your legacy. So come sit down with us. It won't cost you anything. We'll take time to do a complimentary consultation and we'll look at your beneficiary designations, because and that's the other thing. Oftentimes attorneys, you know, attorneys don't do beneficiary designations. Speaker 3 00:24:14 They depend on you to do that. Oftentimes I have found that attorneys will write that they'll give you instructions of what to do with your beneficiary designations, but then they don't absolutely make sure that you implement those beneficiary changes. So all of this is critically important when it comes to estate planning. Beneficiary designations. How you title your property. Very, very important. Now, when we come back, I'm going to get into fraud and scam prevention and how you can protect your wealth for criminals. We'll also talk about our upcoming class, Tax Planning and Retirement, which is this coming Thursday at Pella City State. I'll have more information about that when we come back. You're listening to More Living with Jim Brogan right here on Newstalk 98 seven Woking. Jim Brogan 00:25:05 Welcome back to Newstalk 98 Seven's Brogan Financial Studios, where Jim Brogan is coming to you live with important news and advice to help you achieve your dream retirement. Get ready to learn and live. Here's your host, Jim Brogan. Speaker 2 00:25:20 Thanks for tuning in this week to More Living with Jim Brogan, where it's all about living the best. Speaker 3 00:25:24 Years of your life your way. This is Newstalk 98 seven Waukee and we're with you every Saturday, 9 to 10 a.m. and again from 3 to 4 p.m.. I want to invite you to the class I'm teaching at Pelosi State Community College, through their community outreach and adult education programs. It's this coming Thursday night. Tax planning, taxes in your retirement. And I can't tell you how important I think this issue is. You know, we we pass the one big beautiful bill. Last year it did make the tax cuts from the Tax Cuts and Jobs Act permanent. But you know what. Only in the sense that Congress is permanent. You know, it does take a law change to change our current tax structure. But but that that happens. Right. And when you look at our current fiscal outlook, we just have a math problem. It's unsustainable with the levels of debt entitlement programs, the unfunded liabilities for Medicare, prescription drugs, all of these things we know Social Security at some point has got to be revamped somewhat. Speaker 3 00:26:36 so tax rates are very likely to be higher in the future. And I think it's important to understand the history of our income tax system, understand how our tax system works, how marginal brackets work, and how you can pay less tax over the rest of your lifetime. You know, one of the things that we talk about sometimes is can you live in a 0% tax bracket in retirement? And the answer is many people can. well, everybody could. But, you know, if you've got a good bit of your wealth in qualified retirement accounts like 401 s and you're 60 years old, you know, money coming out of those plans is going to be fully taxable. And, you know, you can do Roth conversion. but that that does create an upfront tax cost. And in many cases people should do that, or at least should consider it. But you know you're not going to do a $1 million Roth conversion. Most people are not going to do that because of the upfront tax cost. So, now younger folks, you can absolutely be structuring things to effectively pay little to no tax when you're retired. Speaker 3 00:27:50 So we're going to get into all of that in my class. The tax planning and retirement. That's this Thursday. It's a one night class. In two hours I'm going to cover as much information as I can about tax planning, both now and in the future. you can find out more information go to Brogan tax plan.com. you can click on a link to download a syllabus. And you can click a button to register directly with Pillow City State. Again it's Thursday night, 630 8:30 p.m.. We'd love to have you there Brogan. Tax planning.com. You can get more information. Let's dive into fraud and scam prevention. We're talking about avoidable Mistakes. In the first segment, we talked about insurance coverages and gaps. And what does it cover? What is it not cover in understanding the fine print in insurance policies? And in the second segment, we talked about beneficiary designations, how we title our assets, that many times because of how our assets are titled and we and we name beneficiaries our wills and trusts don't even govern those assets. Speaker 3 00:28:55 And so we gotta understand how the law works on those things. Let's talk about fraud and scam prevention and how you can protect your wealth from criminals. You know, financial fraud targeting older adults has has frankly reached crisis levels. In 2024 alone, older Americans lost up to up to 81.5 billion, with a B billion dollars to scams and fraud. And the numbers are only growing. And these aren't just statistics, because behind every dollar lost is a real person who worked their entire life to build financial security, only to see it vanish in days or even in hours. And the sophistication of modern scams, especially when we combine with technology like AI generated voice, social media targeting it makes everyone vulnerable. And so today, let's discuss a little bit how to recognize and prevent the most common scams that can threaten your financial security. So reported fraud losses for adults 60 and over in 2024 was 2.4, estimated to be $2.4 billion, and that was up 26% from 2023 in 1 year. But real losses are estimated to be anywhere from 10 to $81 billion due to underreporting. Speaker 3 00:30:19 There's a lot of lot of fraud that goes on that people never report individual losses of $100,000 or more. So think about this where an individual one single family loses $100,000 or more. That accounted for $1.6 billion, which was 68% of the total of the fraud we know about in 2024. And the losses of $100,000 or more increased almost tenfold from 2020 to 2024. Then we also see the most damaging types of scams. We see investment scams, $744 million in losses. Those are the most financially damaging or investment scams. how do you recognize an investment scam? I think that can be more and more difficult in today's world. it's one of the reasons I'm a fan of publicly traded securities, because when you get into now private Placements that are not publicly traded. There are a lot of legitimate good things out there that are worth consideration for high net worth individuals. in order to, put your money in a private placement or a private investment, you typically have to be considered a high net worth investor. And there are rules for that. Speaker 3 00:31:48 But there are a lot of legitimate things up out there. Probably one of the most common would be private real estate trusts or REITs. But regardless of what the private offering is, you know, there's oftentimes a lot more due diligence that needs to be done to make sure that it's not either a scam or, you know, it might it might have been legitimate in the past, but somebody starts embezzling money. You know that you don't have the same kind of public reporting requirements. You know, many times when that happens, it's called a pyramid or a Ponzi scheme. In many cases, it's just the owners or executives that are just embezzling and stealing money from these private placements. So you just have to be careful. As a rule, we like to stick with publicly traded things I do want. Again, be clear. That doesn't mean that private placements are not good or that there aren't good things out there. They just when you look at those things, they have to be very, very thoroughly vetted. Speaker 3 00:32:53 We see imposture scams. We see criminals pose as a bank or Amazon or Microsoft. In many cases, people pose, impostors pose as Social Security, or they pose as the Federal Trade Commission, the FTC. So when we get emails and text, we gotta be very, very careful. What is the source of this email or this text? You know, romance scans can be particularly devastating for widows or widowers, people who are recently divorced. In many cases, the scammer will ask for more money or they'll ask for money. Before meeting someone you know. They meet online, they meet with social media or in dating apps, and they want money before they meet. There are certainly tech support scams out there where older adults, frankly, are disproportionately affected. Where you have tech problems and you need help, there can be government in impersonations, especially with things like Medicare, the IRS, local police, even, and impostors. and grandparent scams with AI. Voices can be cloned, and it makes these especially convincing that you're hearing from your grandchild. Speaker 3 00:34:15 And they're in trouble and they need help. So it's a good idea whenever you're contacted about things that might sound like they're urgent. It's always a good idea to call the numbers that you know are real and verify if if if you have a grandchild supposedly calling you that's in a that's in a a difficult spot. Call them directly on their phone or call their parent or someone else. Call their spouse if they're an adult child that's married. if if it's a an email that you got and it's about your credit card, instead of calling the the number in the email call the number that's on your credit card itself where you know that number is legitimate. So typically, some of the warning signs for these kind of scams, is when you get contacted out of the blue from an unknown source, typically there's going to be a sense of urgency. You know, you have to act immediately. many times they use a lot of fear tactics. If you don't do this, this bad thing is going to happen immediately. Speaker 3 00:35:27 if you're requested for payments via a gift card or cryptocurrency, certainly cash. If you're asked to wire transfer money from your account to an account that doesn't have your name on it, all of those things are warning signs. if if if you're contacted and the claim is you must decide right now to pay something again. That's that urgency. Oftentimes that's going to be a scam. If, if you're asked to, to to keep a transaction secret from your family, that's a huge red flag. Certainly too good to be true investment returns that can be dangerous. And and many times, you know, when we saw with Bernie Madoff. Now, it's been quite a while now since that big pyramid scheme. But one of the things Bernie Madoff did is he provided returns that were good and consistent, but not so alarming. They would raise a lot of flags. His clients, they they they clicked along, making around 11% per year, which is a very good return regardless of market conditions. So he didn't play into the greed of making 20%. Speaker 3 00:36:43 but it was an attractive return that people thought they could depend on. So, you know, financial fraud can destroy decades of carefully planning, of careful planning in a matter of days. And the criminals behind these are more and more sophisticated. They're patient. They're ruthless. They exploit trust, they create urgency. And they use technology to make their schemes nearly impossible to distinguish from from legitimate communications. awareness is your first line of defense understanding how these scams work, recognizing the warning signs and having safeguards in place that can protect you and your family. You know, you should be monitoring your credit regularly. You can do credit monitoring. You can do credit freezes, credit warnings, all kinds of things that you can do. So, you know, this is important stuff. It's becoming more and more prevalent in the world we live in. So protecting yourself yourself from frauds and scams, very, very important that you that you don't unwittingly lose potentially hundreds of thousands of dollars overnight. We're going to get to our last break. Speaker 3 00:37:54 When we come back, we're going to talk about your emergency fund and your debt strategy. How can you build a financial safety net so that you don't have to have things come up that derail years and years of planning? So stay with us. This is your living with Jim Brogan here on Newstalk 98 seven. Wochit. Jim Brogan 00:38:15 Welcome back to Newstalk 98 Seven's broken Financial Studios, where Jim Brogan is coming to you live with important news and advice to help you achieve your dream retirement. Get ready to learn and live. Here's your host, Jim Brogan. Speaker 2 00:38:30 Thanks for listening. Good. More living here on Newstalk 98 seven Wookey. Speaker 3 00:38:36 Check us out online at Brogan financial.com. We got a world of resources, wealth of information there to help you make informed and prudent decisions that can truly impact the quality of your life. My next class, Tax Planning and Retirement, is this coming Thursday. It is through Pella City State's community outreach adult education. It's a one night class. I think the fee is it's either 39 or $49 to fill a city state. Speaker 3 00:39:02 For more information, you go to Brogan tax planning, Brogan Brogan tax planning comm. You can download a syllabus and then you can click and register to register directly with Pella City State. It's 630 this coming Thursday. You know, life can throw curveballs, job losses, medical emergencies, home repairs, family crises. These are unexpected events and expenses that can derail even the most carefully planned budget. The difference between a financial setback and a financial catastrophe often comes down to one thing whether you have an adequate emergency fund. But recent data shows that roughly 3 in 10 Americans have more credit card debt than they do emergency savings, and that leaves them to very vulnerable when life gets turbulent. So we'll discuss how to build and maintain an emergency fund that actually protects you, and how to balance emerging emergency savings with debt management. So many houses, households still haven't rebuilt emergency funds that they've used in recent economic disruptions. Only 18% of Americans increase their emergency savings in 2025 18% one 827% of those who withdrew from emergency savings use their funds for non-essentials vacations. Speaker 3 00:40:31 Discretionary shopping. An emergency fund is things ideally that are emergencies now for people or unexpected events. Now as you get older and you get into retirement, I would say large purchases as well. Those people who increase savings are four times more likely to have increased household earnings. That makes sense, right? As you make more money, you can create more emergency savings. Now, the standard recommendation that you always hear is 3 to 6 months of essential living expenses. And I think that's a good rule of thumb, especially for those of you younger that are still working. But, you know, when we're retired, that type of thinking just doesn't. I don't I don't know that that holds water because when we're retired, we're not thinking in terms of how many months can I pay my bills if I were to lose my job? We don't have earned income when we're retired. So I think a good rule of thumb is to think about whatever your entire investment base is. Is, is 5 to 10% of that being in emergency savings. Speaker 3 00:41:40 And I'm talking about liquid investment reserves. I'm not talking about real estate. If you have significant real estate, I'm I'm talking about liquid investment reserves, marketable market, marketable securities that can be traded. Now, a starting target for young folks would be $500. I'm also a fan of a ladder approach. With your emergency savings, maybe you have one month of savings, one month of expenses in a savings account, and in the next few months you have in high yield savings. And if you've got a good six months of emergency savings, maybe, you know money you might not would need for 4 to 6 months, you might have in CDs where you've been able to lock in a rate for six months. A high yield savings are still, in many cases paying over 4%, but certainly in the threes. accounts are FDIC insured, up to $250,000 per institution per depositor. So I do think that's important to keep an eye on. Is FDIC insurance money market accounts many times offer some pretty nice rates. Speaker 3 00:42:51 so I think one good, one good rule of thumb is to automate deposits. If you're still working, automate deposits on a monthly basis can have meaning for even $50 or $100 a month. Can have very can can really build meaningful benefits over time if you have higher education expenses. Certainly, you know, you might need more emergency savings. You know, if you've got kids in college or getting ready to to go to college. Now, believe it or not. Younger folks, Gen Z post millennials are the most likely demographic now to, increase their savings, which is a great thing for young people today. So focus on the single most important financial priority. Don't try to tackle everything together. It's hard to pay off debt and credit card debt and build substantial emergency savings at the same time. Get something saved, $1,000. Then you can start paying off debt. Then once you do that, start building those emergency savings to 3 to 6 months expenses. So set a target and have a strategy for getting there. Speaker 3 00:44:04 certainly. as you approach retirement, your emergency savings, it helps protect all of the rest of your investment so you don't have things come up where you have to sell an investment at the wrong time. What if the market is sharply down? You don't want to have to sell a CD early. So having emergency savings is a critical component of a financial plan. Today we've discussed avoidable mistakes because greater wealth provides for more living. So you can live the best years of your life your way. Thanks for tuning in. Thank you to Wayne for engineering the show. Thank you to Mary Caroline for helping produce the show. Have a very, very blessed weekend. You've been listening to More Living with Jim Brogan right here on Newstalk 98 seven. Speaker 4 00:44:46 The views expressed by Jim Brogan and his guests are not that of Cumulus Media. Any discussion of financial, legal and tax planning strategies is not intended to be individualized advice and is general in nature. Always consult with your advisor for advice specific to your needs. This program's content does not represent a recommendation of any particular security strategy or investment by Jim Brogan or Brogan Financial, Incorporated.