Imagine retiring tomorrow and never having to worry about the stock market again. No more cable news, no more checking your portfolio, just knowing that you had income coming in year in and year out from your accounts, no matter what the markets do. Income you can count on That’s what we’re gonna spend our time talking about today.

And as a bonus, we’re also gonna show you exactly how to make sure taxes don’t steal your retirement as well. If you wanna know how to have as much income as possible from your portfolio for the rest of your life and never have to worry about running out of money, and you wanna know how to be as tax efficient as possible, you’re in the right place.

I’m Anthony Saccaro. Thank you for taking time to join us for today’s Providence Financial Retirement show. We are your retirement income source, and this is the place where retirees come for income. We’re gonna spend a lot of our show talking about the psychological impact of knowing that you have an income stream that will last as long as you do, and not merely wondering if you do.

Along with that, the less taxes you pay, the more income you get to put in your pocket. That’s a part of the equation as well. And of course, as always, we’re gonna answer some of the questions that we’ve gotten from you, our listeners, as we make our way through the show also. When it comes to your retirement, there’s a huge psychological effect that I think is just really, really underappreciated.

You either have the peace of mind and the stress-free retirement that you deserve, or you don’t. You’re anxious about everyday life, you’re anxious about your portfolio, you’re anxious about what’s going on in the news, and you’re always wondering whether or not you’re doing the right things and whether or not you can take that next trip or give that money to the grandkids or help your kids buy a home or whatever it is that you wanna do, you’re always wondering because you never quite know.

For many of you, whatever the stock market does on a day-to-day basis is going to dictate how you feel that day. If it’s up, you’re gonna feel great. If it’s not up, you’re not feeling so good. And what’s really ironic is some of you don’t even have money in the stock market, and the market still dictates how you feel.

You’re not even participating in it, but it still is the universal gauge as to how well you should feel on a day-by-day basis, even if it doesn’t affect you whatsoever. And that’s kind of strange, but it’s very true. And if you don’t have any money in the market, then you know exactly what I’m talking about.

You’ve worked hard, you’ve saved, you’ve made a lot of wise choices along the way, maybe some that were not so wise, but hey, we all make mistakes. But you’ve got to this point where you’re retired or you’re about to retire. What do you want retirement to look like? Do you wanna constantly be asking yourself, are you invested right?

Are you paying too much tax? Do you have to worry about running out of money before running out of life? How much can you take out of your portfolio? Can you take that trip that you wanna take? Can you fly first class These are questions that you might be wondering if your portfolio’s not set up properly.

And are those the type of questions that you really wanna be asking? Or would you rather be asking, what do you wanna do with your time and with your income, knowing that you’ve got income you can spend any way you want? If you don’t have your portfolio set up to give you that kind of income, then you’re always going to be wondering.

I think a good litmus test of whether or not you’re invested properly is if you’re constantly asking yourself whether you can afford to do something, you’re probably not set up right. There’s that question of doubt in your mind. On the other hand, if your portfolio is giving you income that you can count on year in and year out, then you know what you can and what you cannot afford.

You don’t have to wonder Wondering causes anxiety. Knowing? That gives you the peace of mind that you deserve. If you’re not sure how you can actually know whether or not you have enough income that you can spend year in and year out, if you’d like to learn more about that, we’ve got a resource that you’re gonna wanna get your hands on.

It’s an animated video that is called The Case for Fixed Income. You’ll learn how to get income out of your portfolio that you can count on no matter what. And we’re not talking about an annuity. We’re talking about a strategy that will give you income in the form of interest and dividends, and you’ll learn what that strategy is by watching this video.

I wanna send you this video free of charge by email, but we do have to have your email address. And to give that to us, you just simply need to go to providencefinancialradio.com/video. Again, it’s

providencefinancialradio.com/video. Leave us your email address and your information, and just in a short time, we will email this video on over to you, and all you have to do is watch it. But you’ll learn how to get income from your portfolio that you know you can count on. To get this free animated video, go to providencefinancialradio.com/video and you will have it shortly.

I’m Anthony Saccaro. Thank you for joining us here today for the Providence Financial Retirement Show. Wherever you might be, we are your retirement income source. This is the place where retirees come for income. We’re spending our time today talking about the psychological impact of retirement. I talk about this a lot here on the show because it’s so critical.

I’ve been a retirement advisor for 27 years, and one thing that I’ve learned is that retirement is no fun if you’re always worrying about things that you don’t know. If you’re always worrying about the market, you’re always looking at your portfolio, you’re always wondering how you can pay less in tax.

And that’s fine. Of course you wanna pay less in tax. But some of you are foregoing your retirement and not doing some of the things you want to do in your retirement just because you’d have to pay more tax to get the money out. Well, why? What good is that? You’re literally gonna sacrifice your retirement to save a few dollars from Uncle Sam?

I guess if your goal in retirement, your primary goal, is to screw Uncle Sam out of the tax dollars, then maybe that’s a good reason to do it. But I know that that’s not most of your goal. Most of you want a retirement that is fulfilling, to do the things you want, to have fun in retirement, to enjoy all the fruits of your hard-earned labor.

And in order to do that, yeah, you’re gonna have to pay some tax But do you really wanna let taxes keep you from enjoying the retirement that you want? Do you really wanna let how you’re invested determine the kind of retirement that you have? You know, David from Long Beach wrote in a question that’s very much on topic.

Here’s his question: “I’ve been retired for two years, and I’m second-guessing my entire strategy. Every time the market has a good month, I often think maybe I should put more into growth, but then whenever the market is down, I often think I’m invested too aggressively, and I’m really confused. It sounds like the income strategy you often talk about on your show, Anthony, would solve that problem, but I would love to get some clarification.

Thank you for your time.” Well, David, it is a good question, and this is a battle that many listeners are going through. When the market goes up, you feel like you should be all in, you feel like you could have made a lot more money. Even when someone’s invested for income, a lot of times they’re second-guessing whether or not they should be invested for income, should they have more money in the market.

But that’s only during the good times, right? During the bad times, people are often anxious like you are and wondering whether or not they should even have any money in the market at all. And it’s this constant seesaw, this whipsawing back and forth of good market, bad market, that really dictates how you feel.

And if you like that anxious whipsaw feeling back and forth, getting up every morning and the first thing you do is go to the computer to see what the market’s doing, and you like the stress, then great, you probably don’t wanna change anything. But if you’re like most retirees and you don’t wanna feel that way, you don’t want the market to determine how your day is going to be lived or how you’re going to feel throughout the day, then maybe you do need to change some strategies, and maybe you should be focusing more on the income approach that we talk about here on the Providence Financial Retirement Show.

When you have income coming in from your portfolio that you know you can count on year in and year out It doesn’t affect how you feel that day. Well, I guess it does, actually. You will never feel bad because you know you have your income, so it will affect how you feel, but it will affect how you feel in a good way because you’ll never have that anxiousness.

You’ll know what you can do, you’ll know how much you can spend, and whatever you do day by day or week by week or month by month is not gonna be determined by what the stock market does. And that’s a great feeling. That’s the feeling that I believe most of you want in retirement, not that constant worry and anxiety.

In your question, David, you seem to be asking, “What is it costing me not to have my money in the market when the market goes up?” But here’s a question I wanna ask you, is what is it costing you by way of high blood pressure and stress to have to always be wondering whether the market’s gonna go up or whether you’re gonna be able to stay retired or not?

It’s not all about the market. It’s about how you feel in retirement. And yet I find that many of you, especially newly retired people than people that are about to retire, have never really looked at retirement that way. You’ve never really considered a retirement where there is no stress. But when you focus on investing for income, that’s what happens.

If you have a plan in place and income you can count on, the stress goes away. How do you do that? How do you get there, though? Well, in my book, More Life Than Money, it’s an Amazon number one bestseller, that’s a lot of what I talk about. As a matter of fact, chapter five is dedicated just to that. How do you turn your portfolio into an income stream that you can count on regardless of market conditions?

And if you wanna read More Life Than Money, I wanna send it to you free of charge. You have to ask for it, though, but that’s easy. You can just go to providencefinancialradio.com/book. Again, it’s providencefinancialradio.com/book. Leave us your information, and we’ll ship a copy out to you, and you’ll have it within a few days.

But you’ll learn what you need to know about getting income from your portfolio, so you can have this peace of mind that we talk about year in and year out here on the show. To claim your free copy of More Life Than Money, go to providencefinancialradio.com/book, and you will have it shortly

I’m Anthony Saccaro. Thank you for joining us here today on the Providence Financial Retirement Show. We’re talking about the psychological impact that retirement might have on you. It’s a change. It’s different. You have a 40-year habit of putting money in and saving, and now all of a sudden you’re gonna be taking money out, and just that component alone causes a lot of stress.

One of the questions that we often get is, “How much is enough? How do I know if I can retire?” And those essentially are really the same question, and I wanna help you think some things through. The first thing I think that’s important to know is it’s not a dollar amount. In other words, it’s not a portfolio balance.

The number one question we get asked is, “How much do you need to retire?” And what they really mean is, how big of a portfolio do you need? And quite frankly, I think that’s the wrong question. It’s not at what portfolio size can you retire, it’s at what income. The right question is, how much income do you need to retire?

Because those two answers are gonna give you two very different outcomes. The portfolio size really should only matter to the extent that it can give you income If your portfolio doesn’t give you any income, then who cares how big it is? How’s it gonna help you in retirement? Think about it this way.

Imagine that you owned a one million dollar piece of land, and let’s imagine that you couldn’t sell it for whatever reason, and let’s also imagine that you couldn’t rent it out or you couldn’t lease it. Maybe it was just useless property. If that’s the case, you’re gonna have a million dollar piece of property on your portfolio, but if you can’t sell it and you can’t get income from it, how’s it gonna help you in retirement?

The answer is it’s not. It might look good, it might feel good, but how’s it gonna help you in your day-to-day living expenses? It’s not, because it’s not generating income. Let’s change the analogy a little bit. Now let’s imagine that on the same one million dollar piece of land, you could plant crops and turn it into a farm.

And if you could generate fifty or sixty thousand dollars per year from the sale of those crops, now all of a sudden it’s gonna help you with your retirement. Why? Because you’re getting income that you can spend. In the first scenario, no income, not gonna help you. In the second scenario, you have income you know you can count on.

When you set up your portfolio like that, a portfolio that is giving you dividends and interest, it’s very much like the second part of our farm analogy. It’s just as if you’re getting income from the crops that you’re selling every year, and you know you can count on it. And just as with the farm analogy where you don’t have to sell the land to get your income, you’re living off the crops, well, when you’re living off of dividends and interest, you don’t have to sell your principal to get the income either.

And that way you know that you have income you can count on, and that changes how you feel about retirement When you have income that you know you can spend without any impact on your principal, it gives you the freedom to spend it. And that means you don’t have to wonder whether you can afford whatever it is you wanna buy.

You know you can afford it because it’s income. It’s not cannibalization of your principal. If this sounds like a strategy that you might wanna explore further, I’ve created an animated video that’s called The Case for Fixed Income that I wanna send you, and when you watch it, you’ll learn how you can collect interest and dividends off of your portfolio year in and year out, just as if you were selling the crops each year.

It’s just that dependable. If you’d like to watch this video just to get a little more information, I’ll send it to you free of charge. To get it, you just need to go to our website, which is providencefinancialradio.com/video. Again, it’s providencefinancialradio.com/video. You leave us your email address and information, and we’ll email this video right on over to you.

But you’re gonna enjoy watching it, and it’s fun because it’s animated. But you’ll learn what you need to know about how to turn your portfolio into an income stream that you don’t have to wonder whether or not will be there, you know will be there. Just go to providencefinancialradio.com/video and we’ll send it right out.

You’re listening to the Providence Financial Retirement Show. Thank you so much for joining us today. Really glad that you’re here. My name is Anthony Saccaro. We are your retirement income source, and this is the place where retirees come for income. I’ve been a retirement advisor for twenty-seven years.

Hard to believe it’s been that long, but the one thing that I’ve come to realize in retirement, and truth be told, maybe over just the last four or five years, is the psychological impact that retirement has on many of you, and it’s underestimated and underrated. I’ve come to realize that many of you are retired, but you’re still worried, you’re anxious.

Matter of fact, if we’re honest, a lot of you are more anxious in retirement than when you were working. You’re more worried now than ever because you know you don’t have that job. You don’t have that fallback. If you make a mistake in your forties or fifties, you can correct it, but if you make a mistake now when you’re in your sixties or seventies, there’s no second chances.

And my entire goal here on the Providence Financial Retirement Show is to help you enjoy retirement, to have the stress-free retirement you deserve. That just means doing what it takes to alleviate all that stress. We have a question from James in Costa Mesa that I wanna take some time to answer And his question is this: “My portfolio generates about $60,000 a year in dividends and interest, and that covers my expenses.

But I’m wondering if I’m missing out during the bull markets. Should I be more aggressive?” That’s a very, very common question, and for people who are invested for fixed income, that’s a question we hear a lot. Should they be more aggressive? You have to remember, though, that aggressiveness comes with risk.

Many people who are asking this question are often looking at the upside and not looking at the downside. I was just talking with someone the other day that was making all these statements about the fact that when he wants to retire in two years, his portfolio’s gonna be up probably between 10% and 20%, and I had to ask him a logical question, and that question was this: How do you know?

How do you know that when you wanna retire in two years, your portfolio’s not gonna be down by 10 or 20% or more? And he looked at me like a deer in headlights, almost like I was asking a question that was impossible. And I feel like a lot of times people that wanna take more risk, or they’re wondering whether or not they should be more aggressive, kinda like you are, James, are really looking at it with an optimistic viewpoint and forgetting that there’s a negative side as well, forgetting that the market doesn’t always go straight up.

There’s two considerations here, though, James, that I wanna point out and certainly give you and our listeners something to think about. First of all, I don’t know what the size of your portfolio is. You say you’re getting $60,000 a year of dividends and interest, but I don’t know the size of your portfolio that’s generating that income.

But when you focus on income like we do here at Providence Financial, there’s really no reason why you can’t get 6% or 7% of income from your portfolio. If you have a million dollars invested with Providence Financial and you’re focused on interest and dividends the way that we teach here on the Providence Financial Retirement Show, then $60,000 is a realistic number.

And the first thing I wanna point out is that inflation is a lot less than that. Right now, inflation is in the low 3% range, but let’s just say that inflation is even 4%. Well, if inflation’s 4%, but you’re earning 6%, you’re still ahead of inflation. You still have a real return of 2%. And the definition of a real return is how much you’re actually earning over and above inflation.

If you’re earning 6%, but inflation is 4%, your real return is the difference. That means you’re actually ahead every year by 2%, and it’s a great way to stay paced with inflation. The reason I bring this up is because a lot of people think that if you’re invested for a fixed income, you actually lose to inflation, and I’m not sure where that comes from, but it’s just not true.

As a matter of fact, if you know you’re getting $60,000 a year every single year, it’s a very predictable way to outpace inflation That’s the first point. The second point is this, if you only have a $1 million portfolio and you need $60,000 a year of income, yeah, it might almost have to be fully invested for income because you need a lot of income relative to the size of your portfolio.

But if your portfolio is worth a lot more than that, then why not think about investing the portion of your portfolio that would give you the income you need so that you can live off your interest and dividends, and then that gives you the ability to invest the rest of your portfolio for growth or a little more aggressively if that’s what you wanna do.

And that makes a lot of sense because you’ll never have to sell that portion of your portfolio to make ends meet, because you already have the income you need from the portion of your portfolio that’s invested for income. Hopefully, James, that makes sense, and I do thank you for taking the time to write in that question.

When you have a certain portion of your portfolio carved out for income, though, and you’re living off the interest and dividends, the crops that that portion of your portfolio is giving you, the peace of mind you’re gonna enjoy is a lot greater than you can probably imagine. And I wrote a lot about this in my book, More Life Than Money.

And in the book, I talk about the most common mistakes that I’ve seen retirees make, including being invested wrong when you get into retirement. If you’d like to read More Life Than Money, you can go to Amazon and buy it for $25. It’s a number one bestseller, so you’ll find it. If you’d rather get it for free, though, I’ll send you a copy.

You just have to give us your information. That’s easy. Just go to our website, providencefinancialradio.com/book. Again, it’s providencefinancialradio.com/book. Leave us your address, and we’ll ship it right out. You’ll have it in a few days. But you’ll learn how to invest properly for income like we’ve been talking about.

Just go to providencefinancialradio.com/book, and we will get it right out. You’ll get it shortly, I promise

Thank you for staying with us. I’m Anthony Saccaro. You’re listening to the Providence Financial Retirement Show. We’re in the middle of a really good show. We’re talking about the psychological effect that retirement will have on a lot of you If you’re retired, you already know what to change, and if you’re not retired, you’re probably starting to feel a little bit of stress because that’s just normal.

It’s a change, and human nature just doesn’t like change. I have a question for you, though. Tell me which one you think is true of these two questions. Option number one is you have two million dollars invested in growth stocks or growth index funds in the S&P 500. And option number two is you have a million dollars invested for income.

Which of these two portfolios is gonna give you a better retirement lifestyle? I can only imagine that some of you are probably scratching your heads thinking, “Wait, what kind of question is that? Of course, I would rather have two million dollars than one million dollars.” But do you remember what we talked about earlier, that it’s not the size of your portfolio that determines your retirement lifestyle, but rather it’s how much income you can get?

This example, these two options are gonna illustrate that perfectly. Let’s dissect option number one really quick. Two million dollars in the S&P 500 portfolio index funds that, generally speaking, are gonna be giving you somewhere around one and a half percent per year of dividends. As with both portfolios, there’s gonna be two parts to the portfolio.

There’s gonna be the growth of the S&P 500, and there’s going to be the dividends that it’s giving you. The growth is unknown. The dividends are known. And what I mean by that is when we talk about the dividends, the S&P 500 has always typically paid somewhere between one and a quarter percent and one point six percent of dividends, and you can really count on at least that much from the S&P 500 based on its track record.

When it comes to the value of your two million dollar portfolio, though, the amount that is actually subject to appreciation and depreciation, in the short run, you have no idea what that amount’s going to be. If you have two million dollars in the S&P 500 index funds today, what’s that value gonna be in one year or two years?

You have no idea. It’d be a guess. It could be up by ten or twenty percent, or it could be down by ten or twenty percent. Truth be told, it could be down by fifty percent. We’ve seen that happen in history as well too. The key ingredient, though, is you don’t know what that two million dollar value is gonna be, and therefore, you can’t count on it.

The only thing you can really count on is the dividends. And if you’re getting one and a half percent dividends on that two million dollars, that means you’re getting about thirty thousand dollars a year. That’s the amount you can spend that you really don’t ever have to worry about running out of money.

So the two million dollars is giving you thirty thousand dollars per year of dividends. That’s the known. That’s option number one. Let’s switch gears and talk about option number two. If your portfolio is invested for interest and dividends, for income, like I teach here on the Providence Financial Retirement Show, you’ve got those same two components.

You’ve got the value of the portfolio, and you have the interest and dividends it’s gonna give you. The difference is this: the interest and dividends are gonna be three times at least more than you would get from the S&P 500. Right now, you can easily get 6% or 7% per year from interest and dividends, and on a $1 million portfolio, that means 60 or $70,000 per year And that’s income you can count on.

That’s income you can spend. That sixty or seventy thousand dollars per year on the one million dollars is more than twice what you can get in dividends on a two million dollar portfolio if you were invested in option number one for stocks. The one million dollars is gonna fluctuate, but regardless of the fluctuation, you still have sixty or seventy thousand dollars per year you can spend.

It’s that sixty or seventy thousand dollars that you can count on, and that’s the difference. If your two million dollars is invested for growth, you’re only gonna get maybe thirty thousand dollars a year of income. If your one million dollars is invested for income, you’re gonna get sixty or seventy thousand dollars per year of income.

What’s more important to your lifestyle? The size of the portfolio or the amount of income you can actually spend? I ask you the question again then. Which option would give you a better lifestyle? A two million dollar portfolio that’s only generating thirty thousand dollars of income, or a one million dollar portfolio that’s generating sixty or seventy thousand dollars a year of income?

The light bulb is probably starting to come on. That’s why I say it’s not about the size of your portfolio. It’s about how much income you can get. If you wanna learn more about how to get that type of income from your portfolio so you know you can count on it, I’ve created an animated video just for you, and I wanna send it to you.

We’ll email it, but you’ll learn how you can turn your portfolio into an income stream that we’ve been talking about. All you need to do to get it is go to providencefinancialradio.com/video. Again, it’s providencefinancialradio.com/video, and we’ll email it to you. You’ll have it shortly. One more time, to claim your free animated video about getting income from your portfolio, just go to providencefinancialradio.com/video and we’ll get it right out.

But you’re gonna really learn a lot by watching it. I’m Anthony Saccaro. Thank you for taking time out of your day to join us, wherever life might have you today. You’re listening to the Providence Financial Retirement Show. We’re really talking about the psychological impact of retirement that many of you, I think, have just underestimated.

This is a component of retirement that when you really think about it, if you’re invested properly, not only do you not have to worry about running out of money, but the peace of mind that comes with that is just absolutely huge. You almost can’t even put a price on it. People often talk about return on investment and how much is your portfolio growing by, but I want you to think about how much is your stress growing by, or what is the ROI of the peace of mind that you have in retirement as well?

When do you know enough is enough? We just talked a minute ago about two portfolios, a $30,000 portfolio that’s invested for growth that’s only giving you $30,000 a year of dividends, and a $1 million portfolio that’s invested for income that is giving you $60,000 per year of

interest and dividends. And the question is, which one is going to give you a better lifestyle? The answer is counterintuitive. The $1 million invested for income is gonna give you more income, twice as much income as the $2 million that’s invested for growth, and it’s the income you can spend. What you have to know is that you can’t spend growth.

If you have $2 million and it’s only generating you $30,000 of dividends, but you wanna spend $60,000, where’s that other $30,000 gonna come from? The answer is you’re gonna have to start selling principal. If you have stocks, you’re gonna have to sell some of those shares of stocks. If you have mutual funds or ETFs, you’re gonna have to sell some of the shares of the mutual funds or ETFs.

What you’re really doing is you’re forced to cannibalize your principal. As long as the market behaves, then you’ll be okay. But what about the years that the market doesn’t behave? What about the years that the market goes down 10% or 20%? From a math standpoint, you’re gonna wind up having to sell a lot more shares just to get the same income because the value of the shares have gone down.

That’s the mathematical point of view. The psychological point of view is this: Are you gonna want to sell more shares when the market is down so that you can take that extra trip or give the money to the grandkids or charity or church or whatever it is you wanna do? The answer is no. When the market goes down and you know that if you wanna stay an extra week or you wanna fly first class or you wanna go to that amusement park or go out those extra couple of nights and you know that you’re gonna have to sell more principal in order to do that, you’re not going to do it That’s the negative psychological impact that being invested for growth has on you as a retiree.

What if you were invested for income, though? What if that entire $2 million was invested for income, and all you were doing was getting 5% on that $2 million? You realize that’s $100,000 a year, year in and year out, that you can count on no matter what the market does. If you’re only spending $60,000 per year, you still have another $40,000 left over, even if the market’s going down, because you’re not participating in the market.

This gives you income you know you can count on. And that way, when you wanna fly first class, or you wanna take that extra week, or give more money to the grandkids, you still can do it because your ability to do that is not tied to the stock market. And that’s a significant psychological difference between being invested for growth or being invested for income.

It’s huge. It’s really a lot more important and a lot more impactful on your retirement than I think you’re probably even considering. In my book, More Life Than Money, I spend a lot of time talking about this because it is so important. I wanna send you a copy of More Life Than Money free of charge just because you’re a listener here of the Providence Financial Retirement Show.

If you wanna get a copy, just go to our website. It’s providencefinancialradio.com/book. Again, it’s providencefinancialradio.com/book. Leave us your information. We’ll get a copy right out to you. You’ll have it early next week for sure. One more time, to get your free copy, brand-new copy, of More Life Than Money, go to providencefinancialradio.com/book, and we will get it right out.

Thank you for staying with us. You’re listening to the Providence Financial Retirement Show. We are your retirement income source, and this is the place where retirees come for income. Really glad that you’re here today. My name is Anthony Saccaro. We’re in the middle of a good discussion about the psychological impacts of retirement.

I talk about this a lot here on the Providence Financial Retirement Show because it’s such an important and yet underrated topic. What good is retirement if you’re always stressed out and anxious about life and worried about taxes and whether you have enough to live and how much income you can get?

That’s not the retirement that you want. That’s the reason I do this show, is to help you have the peaceful retirement that you deserve. When it comes to the income that you’re getting from your portfolio, are you having to burn wood to get that income or do you have solar-powered income? Well, that question probably doesn’t mean a lot, but if you stay with me for another two or three minutes, it will, ’cause we’re gonna answer that.

But I’m gonna answer it in the context of Margaret’s question because she wrote in from Santa Monica and she says this: “My financial advisor says it’s fine to sell stocks from my portfolio each year to fund my retirement. He says that the market’s gonna make up for it over time. Is that really true or am I gonna find out later down the road that I might have to worry about running out of money?”

Well, Margaret, it’s a great question. I’m so glad you’ve asked. I’m get the feeling that you’ve probably listened to the Providence Financial Retirement Show a lot because most people who are familiar with investing for income like it seems like you are often don’t even ask that kind of question. Their financial advisors simply just tell them, “You can sell, you can sell, sell your principal, follow the rule of 4%.

The market always comes back. You’ll make up for it later.” But that’s not always true And the psychology of having to sell investments to get your income every year is going to dictate what you do. If you wanna take an extra trip and you know you have to sell more investments to do that, which means that your portfolio is gonna run out sooner, you’re probably not gonna take that extra trip.

You’re probably gonna forego that trip. Why? Because you don’t know how long you’re going to live. And it’s the difference between having a wood-burning stove and having solar power. Imagine for a second with me that you lived in a log cabin, and this was your retirement home, and you have a stack of wood out back, and once that wood is gone, it’s gone.

But that wood is what you need to fuel the wood-burning stove that is going to heat your cabin. Well, if you’re in that situation and it’s a little bit chilly and you’re wondering, “Should I burn another log and heat up the cabin? Or maybe I should just suck it up. Maybe I’ll just throw on a sweater, and that would be good enough.”

If you’re in that situation, what would you do? Well, I don’t know. I’ve asked this question hundreds of times, and most people say, “In that situation, I would just suck it up. I’d throw on another sweater.” Why? Because every log you use is one log less you have for the future, and you don’t know how long those logs need to last.

So sucking it up seems to be the appropriate response. On the other hand, what if you had solar panels on your roof and you never had to worry about heating your log cabin? In that same scenario, would you still suck it up, throw on a sweater? Or would you turn the heat up a little bit to be more comfortable because you know you could, because you know that you’re not in a race against time?

Well, the answer is pretty apparent. Of course, you would turn the heater up a little bit because it doesn’t cost you anything. When you have solar panels, you never have to worry about running out of heat. That’s why I ask the question Are you burning wood to get the income you need from your portfolio, or are you living off of solar-powered income?

Just like we talked about before, if you have $2 million that’s only giving you $30,000 a year of dividends, if you need $60,000 a year, that $30,000 is not gonna cover it. You’ve gotta burn another $30,000 of wood, and you know that that wood’s not going to last forever. But when you’re focused on interest and dividends, you never have to worry about heating up your retirement because the sun is always shining.

You will always have that heat. And from a psychological standpoint, that’s a significant difference in how you feel about your money. When you know that you can turn up the heater and it doesn’t impact your future retirement, you feel better about warming up the house. You feel better about taking that extra vacation or flying first class or giving that extra money to your church because you know it’s not going to impact your future.

That’s the difference. If you’re in a position where you’re retired or you’re about to retire and you finally wanna get out of being invested for growth and always worrying Then you really gotta get this animated video that I’m offering throughout the show. It’s called The Case for Fixed Income, and you’re gonna learn how you can turn your portfolio into an income stream that you never have to worry about.

I wanna send it to you free of charge. In order to get it, you just have to go to our website, which is providencefinancialradio.com/video. Again, it’s providencefinancialradio.com/video. Leave us your email address, and you’ll have it shortly. We’ll send it right out, but you’ll be able to watch it, and you’ll learn how you can start getting predictable, reliable income from your portfolio.

Just go to providencefinancialradio.com/video and you will have it in your inbox shortly. I’m Anthony Saccaro. Thank you so much for staying with us. You’re listening to The Providence Financial Retirement Show. If you just happened to join us, we’re talking about the psychological ramifications of retirement, and really considering the fact that many people are living in retirement with the constant stress and anxiety, and that oftentimes boils down to the fact that there’s just an unknown amount of income that they can get from their portfolio, and they really don’t know how long their portfolio’s gonna last.

When you invest for income, though, that changes. You know how much income you’re going to get from your portfolio, and that means that you have the freedom to spend it and the freedom to quit wondering, because when you’re living off your income, you never have to worry about whether or not your portfolio’s gonna disappear, and that’s going to give you the peaceful retirement you deserve.

If we go back to Margaret’s question, which we’re really still kind of answering, she essentially suggested that her financial advisor is saying that it’s perfectly fine to just sell stocks from her portfolio to fund her retirement each year, and that’s not a surprise, because that’s what most financial advisors say.

That’s what they’re taught to say. The market always comes up. It’s always gonna recover. You’ll always get it back. And when you’re in 20s and 30s and 40s, that’s true. But the older you get, the less true that becomes. The less time you have, the more important it is to understand where you are in life, and the more important it is to realize that the shorter your timeframe, the more gambling the stock market becomes.

That’s such an important statement that I think many of you don’t realize. I’m gonna say it again. The shorter the timeframe, the more gambling the stock market becomes. Let me give you an example. Let’s talk through some numbers, some history. You cannot find a 40-year period in the stock market where the market has not averaged at least 8% per year.

That’s a very true mathematical statement. If you’re 20 or 30 years old then, you should have comfort in that, because if you have 40 years, then you know that you’ll probably average at least 8% a year, and there are some 40-year time periods that have averaged even more than that. And you can count on that because you’re dollar cost averaging because you have so much time on your side.

On the other hand… There are many 10-year periods where the market has not made any money at all. I’m talking ups and downs, but at the end of the day, the ups and downs wash each other out, and there’s no growth. There’s many of them. Practically, then, this means that for the next 10 years, we don’t know whether the market’s gonna grow eight percent or not, or whether it’s gonna be flat.

We just don’t know. Many of you are not even thinking that we could have a 10-year flat period, but it’s happened before, and if something has happened before, then what does that tell us about the future? It could happen again. And if you’re optimistic, you’re not thinking that way, and I find that many of you are optimistic.

But the shorter the timeframe, the more gambling the market is. Now let’s go even further, or let’s cut that back even more. You have a portfolio, it’s invested in the stock market. What’s your portfolio gonna be worth in the next two years? You have no idea. There are two-year time periods where the market’s up by forty or fifty percent, and there are two-year time periods where the market is down by forty or fifty percent, and you have no control over it, and that’s the definition of gambling: putting your money somewhere, hoping for a good outcome, hoping that you don’t lose money, and not having any control of the outcome at all.

If you only have a two-year time horizon, mark my words, the market is gambling, and if you gamble that it’s gonna go up and it doesn’t, it could wreck your retirement. That’s what I wanna help you avoid. And when you know that, you’re living in retirement, and you just know in the back of your mind that that could be true, it’s going to affect how you feel every single day.

But when you’re invested for income, the way that we teach here on the Providence Financial Retirement Show, you know you can count on your income. You don’t have to wonder whether you can count on your income, and that is gonna give you the peace of mind that you deserve. If you wanna learn more about how to have that peace of mind, you’re gonna wanna read my Amazon number one best-selling book, More Life Than Money, and I’ll send it to you free of charge.

You just have to ask for it, and you can do that simply by going to providencefinancialradio.com/book. Again, it’s providencefinancialradio.com/book. Leave us your information. I’ll be very glad to send you out a copy so you can get the education you need and start living the retirement that you want. Go to providencefinancialradio.com/book and you will have More Life Than Money show up on your doorstep shortly.

I certainly hope you’ve enjoyed the show today. We’ve been talking about how you can feel better in retirement by focusing on income-producing investments. Thank you for being with us. I’m Anthony Saccaro. You’ve been listening to the Providence Financial Retirement Show. Have a great week, everyone. God bless.