New Goals for the New Year

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Amber Posthauer: Hello, everyone! Thank you for joining us today. We're gonna get started here in 60 seconds to allow for everyone to get connected. We'll get started shortly.

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Amber Posthauer: Welcome, everyone, to New Goals for the New Year, Creating a Roadmap for 2026.

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Amber Posthauer: Thank you so much for joining us.

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Amber Posthauer: Please send your questions through the Q&A located on your Zoom menu bar.

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Amber Posthauer: We'll try our best to answer all of your questions, but if for whatever reason we are unable to get to your question today, please email learning at nfp.com.

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Amber Posthauer: Today's presentation is being recorded. We will be sharing the recording in the coming days. At this time, I'd like to hand over the call to Michael Hodge, financial advisor at NFP and Aon Company. Michael, the floor is yours.

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Michael Hoch: Wonderful. Thank you very much.

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Michael Hoch: And, dare we say, Happy New Year, and, right? We talk about new goals, we're already almost through the end of January, how can I say that? It's amazing how things fly by.

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Michael Hoch: But I welcome you, and I appreciate your taking a bit of your time out of your day today to kind of engage and think. As introduced, my name is Michael Hotch. I'm a Senior Advisor with NFP. I've been in the wealth planning and financial planning world here for almost 28 years now.

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Michael Hoch: My mantra that I always talk when I work with and do presentations for employer groups, as well as work with individuals, is I call myself a behavioral investment advisor, and I think…

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Michael Hoch: This is so true on so many levels. So the goal of today is a couple fold. This is really just to kind of walk you through and help you kind of think and engage as to your goals, your plans, what you have, what you need to do, what you want to focus on, number one, but then number two, to let you know that as a resource for you with your employer, is the ability to speak with an advisor such as myself. It might very well even be myself.

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Michael Hoch: To really kind of get specific and granular for you with regards to your goals. And again, they can be a cross-sectional of a multitude of different topics that we work on. Obviously, what we're talking more is on the financial world, and again.

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Michael Hoch: What I tell people is, you know, from a financial goal, you can have a multitude of different topics and things that are of concern to you.

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Michael Hoch: And when we talk about, you know, when we talk about the markets, right, I mean, if you're a student, or you look at the markets, or even if you're not, right, you know that even, like, today, the markets are completely volatile, and crazy, and upside down, and tariffs, and global trades, and global conflicts, and you name it, right? The one thing certain I tell all my clients and all my folks I work with.

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Michael Hoch: Is that every day is going to bring us uncertainty.

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Michael Hoch: And I think the key to setting goals is having clarity and certainty with what you want to achieve, right? Now, how you get there, can be very circuitous, but you have to have that. So when we look back on 2025, right, as a financial advisor, and when I speak with people, right, 2025 was really a good kind of, if you look at it, if you look backwards on it, right, a good indicator of kind of how the stock market works almost every year, right? If you remember.

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Michael Hoch: Right? In January, February, similar to where we are right now. As we led into the year, there was talks about tariffs and a lot of different things going on, and the first two months, things were kind of nice and kind of steady as she goes. And then if we go back to March.

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Michael Hoch: Right? March and April, it was the tariffs were on, the tariffs were off, there was China… I mean, you name it. And the markets, at one point, from the peak to the trough to the bottom, went down almost 18%, right? In, like, a snap and a blink of an eye.

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Michael Hoch: And we realize, and much of us realize, is that we don't like… the markets don't like a lot of the uncertainty, right, in a small microcosm. But if you look, as we did last year, right, even by the end of 2025, despite having been down by almost 18%,

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Michael Hoch: The markets, the S&P, was up, ended the year up 19%. So, what we talk about, and even the goals as investors, right, is, and we'll talk in the presentation, is your risk profile, right? Each and every one, I work with hundreds of different individuals and family units.

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Michael Hoch: Everyone is different, right? So when we look back on 2025, right, that's no different than if I had a conversation with 2024, even if you go back the last 30 years, there's always some disruptor that we're going to find.

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Michael Hoch: You know, and then when we talk about Financial factors going into 2026. I resist the notion of making prognostications or forecasts what I see in the market. I, myself, as an investor, right, for many of my goals, have long-term horizons, so when I say I don't care what happens in the market, clearly, of course, I care every… about

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Michael Hoch: You know, the markets, the world, all these other things. But the day-to-day undulation, so to speak, right, we want to kind of take a breath and relax, right? Now, again, if you're planning on retiring this year.

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Michael Hoch: Totally different conversation, and those are conversations you should be having with your financial advisor, or if you don't have an advisor, you know, someone like myself, you can reach out to. Again, at NFP, for many of the folks joining on this call, we might be the advisors

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Michael Hoch: That oversees your employer's 401K, 403B, retirement plan, and they might be, whether it be with Fidelity, Vanguard, T. Rowe Price, Principal Group, Empower, right? So we are the advisors that oversee them, and those are conversations that we want to have. So the reality of it is, is when we talk about creating a plan for you here, right? Going back when we looked at, you know, last year.

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Michael Hoch: Of the things that we talk about here, you know, in terms of, the markets and what things look like with the Fed, right? And that was… and again, even most recently, right, there's … I don't get involved in the politics discussion, it doesn't do anything, right? But there's a lot of the going back and forth with regards to the Fed and the current administration, with regards to lowering rates, what it should work like, right? So their mandate, really, is to keep inflation.

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Michael Hoch: Low and unemployment low, right? So that's the key, the mandate of the Fed. And what Jerome Powell does is he's determining, you know, when they raise rates, when and how often they should be lowering the rates. And you know, there's… I don't necessarily know that it's even a science, right? Because we can't prove what's right. It's a kind of hindsight, revisionary history that we look back. But this is what we want to look at.

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Michael Hoch: The cost of living, right, we'll talk about that, right, in terms of inflation.

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Michael Hoch: Again, there's all different metrics and barometers that we use to discuss inflation, but at the end of the day, right, it's our world, and how does that impact us, right, in terms of going out to dinner, getting a dozen eggs, or milk, or sending a kid off to college, right?

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Michael Hoch: You know, the historical… again, we talk about historical averages. I don't care. I really don't care historically that what inflation was 15 years ago. I want to know how is it impacting me now, right? And then how can I save and accumulate enough money to become kind of not impervious to inflation, but to understand how it's going to impact me, and my spouse, or my family with that. When we talk about homes, you know, and home purchasing, right? I mean, we're just…

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Michael Hoch: I've got four kids, and across the section, from one in college to, you know, married with a child, right? And I see the struggles of buying homes, paying down debt, all of these things, right? It's a juggling act at some times, right?

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Michael Hoch: I don't care where you're on, or on the economic side, right, there's always something going to be pulling or pushing at you, right? And it all just changes and evolves as we get older, as we mature, as we make more money, right? We just take on and tackle more things.

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Michael Hoch: Couple of things that we want to understand for 2026. For… again, we have 401K, 403B, if you work for the federal government, TSP, all of these. Anyone on the call today can contribute, if your employer offers a 401 retirement plan, $24,500.

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Michael Hoch: For the vast majority of folks, you probably have a Roth provision in your 401k, right, which allows you to, put away money on a

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Michael Hoch: Pay your taxes today, right? The pre-tax, you save your money.

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Michael Hoch: Grows, grows, then you pull it out, you pay taxes. The Roth, you pay your taxes today, it grows and grows and grows, and you don't pay any taxes on the back end. Really good. Again, if folks on the call here are younger, I'm a big endorser of Roth provision. Again, you can reach out to me, and we can kind of go over the nuances.

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Michael Hoch: If you have an IRA, and the IRA and Roth IRA, we should say, that's separate, you know, not… the 401K is $24,500, you could put it all pre-tax, you could do it all Roth, or combination there of the two of.

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Michael Hoch: An IRA or a Roth IRA is going to be subject to your income, whether you participate, etc. There's a little more nuance with regards to that. The catch-up contributions in 401Ks and 403Bs, right, if you're over 50, you can do $8,000, right?

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Michael Hoch: If you're age 60 to 63, right, you can do 11,250. Don't ask me how they come up with these numbers, but that's what it is, right? And then, one further note, if you are 50, and you earn over $150, those catch-up contributions must go into the Roth provision of your employer plan. Again, most plans have already taken into consideration with regards to that.

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Michael Hoch: So when we talk about, you know, the… I've addressed a little bit here, addressing market uncertainty, right? The S&P as an index.

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Michael Hoch: Again, I don't want to get geeky on you, is when they talk about it's trading about 22 times what's called forward earnings. So there's a price to earnings, right?

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Michael Hoch: What's the price of the share compared to what the earnings are, right? And what's the percentage, right? If it's really high, right, then that becomes a much more volatile stock. But the S&P as an index is about 22.

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Michael Hoch: Now what you have to be… and again, I'm not saying you run and put everything in the S&P 500, right? But, you know, when it… 25 times when the tech bubble collapsed.

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Michael Hoch: Again, everyone keeps talking and asks me, is it a tech bubble, an IT bubble, you know, an AI bubble?

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Michael Hoch: It's all different, right? In terms of where we are, right? The tech bubble was really kind of new frontier, right? Now, we're talking, especially with the S&P, right, there's the seven big… the magnificent seven, right? The big tech stocks that make up a huge percentage of it. It's heavily weighted towards that, right? So…

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Michael Hoch: Again, if you… what I tell folks not to do is go to look at your 401K or your retirement plan and choose the funds that did the best last year, or the year before, right? You want to be diversified.

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Michael Hoch: And that's what it… this is a reminder. You want to be diversified consistently. I don't care where you are in your investment time horizon, diversification is the key to it.

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Michael Hoch: Right? So, when you think about it, and again.

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Michael Hoch: Specific to today's presentation, we're really talking more about your retirement planning, right? But if you call me and you say, hey, Michael, I'm looking to buy a house, or pay down student loans, or debt, or anything, right, we're going to have different conversations, right? But the general thought is, right, if you're young, right, if you're in your 20s, 30s, 40s, right, you want to be in what we call the stock market. You want to be an investor in equity, stocks, right?

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Michael Hoch: As you get older, right, you can have a little more in the fixed income or bond side to it, right? And as you get older, you want to have a lot more into those. But every… again, everyone's different, you know, where you are.

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Michael Hoch: Are you contributing? Are you going to be working, you know, for 10, 15 more years? Does your employer have a match? All of these things are factors to what it looks like. So there's not…

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Michael Hoch: One set rule for everyone, but as an industry, we kind of use some of these parameters as something to kind of think about.

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Michael Hoch: We have down here your risk tolerance. So I always like to define risk tolerance two ways, right? What's your ability to take on risk, and what's your capacity to take on risk?

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Michael Hoch: And here's where I make the delineation, right? For anyone on the call today who's in their 20s, 30s, 40s, and I would even say in their early 50s, right, by definition, you have the ability to take on risk. And what I say this is, as NFP, if we are your advisors on your retirement plan.

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Michael Hoch: You are, by definition, an investor, right? Because if… and barring having individual stocks in a 401 , right, what our team does behind the scenes is making sure that we're using tried and true investments, mutual funds.

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Michael Hoch: Pooled investment strategies, right? So they're not day trading, they're not market timing, right? None of this stuff. So you are, by definition, an investor. So I would say, by definition, you have the ability to take on risk, because you're contributing, your employer has a match, you're not going to touch it for 10, 15, 20 years, right? Who cares?

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Michael Hoch: As I said, who cares what happens in the market today, right, if you're investing for 20 years from now? Because it's not the timing of the market, it's the time you spend in the market.

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Michael Hoch: The risk… tolerance, remember I said you have the ability capacity.

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Michael Hoch: Capacity is what happens here in your belly and in your head, right, psychologically, when the markets become tumultuous. And as I said, and part of what we're talking about today is planning and setting goals, and all these other things. And I'm a big, big student of behavioral economics. There's a huge school that's come on there, and there's some unbelievable studies. There's a Daniel Kahneman, if you look up behavioral finance and behavioral economics, it's fascinating, right?

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Michael Hoch: There's one of these… there's a study out there, it's called the Prospect Theory, right? And it's how people make decisions, right? And we know that loss aversion supersedes and trumps that of gaining increase in pleasure, right? We have such a higher propensity to avoid fear and loss than we do gain and happiness, right? And part of that is to understand and develop your own strategy.

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Michael Hoch: Again, what I talk about here, charts, graphs, whatever. This just goes back to 1994 through 2023. We're actually updating these statistics here.

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Michael Hoch: But an average stock portfolio, equity, right? S&P, large companies, small companies, etc., has averaged almost 11% rate of return, which is fantastic, right? It's unbelievable. Money would double almost every six and a half, seven years. Just what you have would double at an 11% rate of return.

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Michael Hoch: Right? Now, part of this is what we call the sequence of returns, right? If you're getting ready to retire, if you were getting ready to retire in 2007, and the markets went down tremendously, right, that could be… have a negative impact on where you are.

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Michael Hoch: But the diversification, as I showed you before, whether you're old, you know, a little in your late 50s or 60s, yes, you want to have some stocks and bonds to mitigate some of that volatility. And again, this is what your advisor or someone like myself or your team can help you with when it comes to understanding the markets.

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Michael Hoch: So, again, what I always tell folks when I work, I do this personally, I do this with my wife, my family, you name it, individually, right? What worked well, what didn't go well? You know, what changes, right, in your life?

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Michael Hoch: I can tell you, as kind of in my late 50s, right, I see this with, as I mentioned, 4 kids, one in college, one married with kids, I've got parents, in-laws that are older, you know, my wife, we're getting that sand… a lot of folks who are in that sandwich generation, having to take care of moms and dads and… or brothers and sisters, right? You want to plan for these?

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Michael Hoch: Unexpected expenses, they can come quick and fast, and that's part of the budgeting and planning process that I always work with folks, right? Because, you know, I always say it's easy, debt and diet, right? It's easy to get into debt, and it's easy to put on weight, right? Give me a thing of ice cream and some pizza every day. I'm down with that.

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Michael Hoch: But we know long-term what's gonna happen if you do that. It's easy to get in debt, and it's easy to put on weight, but man, is it exponentially more difficult to take it off, or to get out of debt. So, we want… you want to have these conversations, and I tell people all the time, and if I speak with you, if it's just yourself, great. If it's your… if you're married, right, your spouse, your partner has to be bought in to all of these things, right? Because if you're, you know, if you're rowing a boat, and you only got one ore, right, you're just going in circles, right? You need to have them both working in unison when it comes to this.

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Michael Hoch: So, was I making, you know, your financial goals in your making process? And again, you can have multiple goals working for you. And do I have clear goals? Again, I'm not about… I don't like the notion of, come January, you set your New Year's resolutions.

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Michael Hoch: We know, the studies just show they don't… they just simply don't work. But you want to be disciplined and have them.

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Michael Hoch: You know, when it comes to your goals. So what we talk about is this, and this is… just goes back to what… what behavioral economics.

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Michael Hoch: When you have a goal, the acronym SMART, specific.

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Michael Hoch: Measurable, achievable, relevant, time out. And it doesn't necessarily matter. Time, especially if you're in your 20s, 30s, 40s, for retirement, we could be talking about a 20-year time horizon, so the timing could be, you know, could be greatly varying for everyone when we look at all of this stuff there. So, again, I think I did a presentation the other week, and I said, right, so the… there's a… I have an example of save $3,000 of an emergency fund by October by setting, you know, $300 a month. But I always give the example of, if you save…

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Michael Hoch: A dollar a week the first week, and then $2 the second week, $3 the third week.

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Michael Hoch: $4 the fourth week, right? And you kind of get that math. If you do that over the course of a year, you'd actually save almost $1,300, right? And I just give that example, right? It's little… now, again, you can make it larger, but if you just use… again, I'm always about small steps, right? Taking little steps to build on good, achievable goals, right? So, and a lot of this, I tell folks, is it's important to have them, but if you write them down.

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Michael Hoch: If you discuss them with someone, if you share them with someone, if you hold… have someone help you count… be accountable, right, the likelihood of you achieving these things like, is exponential when it comes to this, right? So, this is what… I mean, these are the things I get passionate, this is what I love to do, so please, you know, reach out to us to help… have you help do specific and achievable, relevant goals for each of us that we have.

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Michael Hoch: Again, what I said we can have short-term, again, paying off credit card debt, building an emergency fund, right? It's, you know, I don't know if you watched the football game last night, the national championship, I think every other commercial was for a bank or financial credit card, this and that, or, you know, I… so, so many times I get… clients will tell me they've, you know, they got a credit card, they got credit card debt, but they get points.

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Michael Hoch: My contention always is point schmoinks, right? If you've got a lot of credit card debt, the interest that you're paying could be a vacation, so don't buy into that, right? Understand and be judicious.

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Michael Hoch: And we all know, right? I mean, I could order something here while I'm on my call today and have it delivered at my front door. And I always tell people, what do you want? What do you need? Right? And I say this, and everyone smiles, and they laugh.

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Michael Hoch: But it's, it's those wants that get us into trouble, right? The midterm, like buying a home, putting down a house payment, saving for, you know, education, retirement planning, longer-term goals. Again, short-term, you know, timeframes could be paying off.

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Michael Hoch: You know, student loans or anything else, right? And those are good conversations we have. So these are common goals that we see that we work. Improving your credit score. I could also contend, and we'll talk about this a little bit.

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Michael Hoch: It's equally as important to understand your credit score as it is to make certain you're doing, like, your credit monitoring, because the fraud and the ID theft is so prevalent out there. Saving per purchase, retirement planning, funding education, you know, budget, all of these things are germane, probably to any… each and every one of us on this call.

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Michael Hoch: The budgeting, right, I always tell the budgeting, because this is… everyone asks me, how do I budget?

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Michael Hoch: In the budget, the reality of it is, I always call it, it's simple math. Much of what I do is simple math. I can get geeky and analytical on all different market theories and this and that.

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Michael Hoch: But at the end of the day, budgeting is what's coming in, what's going out.

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Michael Hoch: Right? We can control what's coming in… well, what's going in is your salary, whether your salary, commission, if you have a part-time job, right? I mean, this is not uncommon to have, especially some of my younger folks, I tell, you know, they ask me, how do I pay off debt, and this is your salary, you know, get a part-time job. Number one, it keeps you off… out from spending money, right, and brings in additional money, but the budget is right down, where… and we know that things, you know.

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Michael Hoch: You gotta start a family, you're buying a car, insurances, all these things become really a cause of a lot of angst for all of us, and it doesn't matter where you are. So when we talk about credit and credit score, right, it's just…

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Michael Hoch: And the whole credit score is somewhat cockamamie when it comes to all of this, but, you know, I always say, if you have a credit card or two, probably don't need any more than that. Don't go to the store, and they say, well, if you buy today, you get this, avoid any… much of that, right?

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Michael Hoch: Debt, again, the average… what we see, you know, people had… again, interest rates on credit cards have gone up tremendously here, right? And again, it's… it's… credit card debt is, like.

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Michael Hoch: I don't know where you are, but if you're in the Northeast and it's super cold where we are, right? If I went to your house today and opened your windows, you'd think I was a little bit crazy.

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Michael Hoch: Someone argue I am, but nonetheless, right, it's just… the money's just flying out your window. Understand that. Debt… mortgage debt, oftentimes is a good thing. Be careful of then taking out a home equity loan and having high interest payments. Student loan debts, we see, is huge. These are huge conversations to have.

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Michael Hoch: With, as I said, as a parent of four children, right, conversations in terms of where the kids are going to college, and what that looks like, right? So the credits in, you know, if you have high… bad credit scores, you have… might oftentimes get higher interest rates when you're buying a car. If you have a better credit score, it is… so again, you just want to build these things slow and steady with regards to it. So again, good debt, bad debt.

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Michael Hoch: Student loans, mortgage, credit cards, good debt as low interest rates.

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Michael Hoch: Owning, you know, again, a mortgage, if you do a 30-year mortgage, right, your monthly payment's gonna be the same today as it is going to be 20 years from now. Yet, if your salary or income goes up, right, you might see, you know, it's going to be a proportionally a lower percentage of what you have.

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Michael Hoch: Bad debt, high interest rates, the credit cards, any of these things, understand.

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Michael Hoch: Again, too many times I get folks who have credit cards and they're paying the minimum.

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Michael Hoch: Right? It's just… that's the money flying out the window, right? So we look at the methods of doing it. Number one, before you even tackle any of this, right, you have to have that come do whoever moment, right? Come to Jesus, come to Moses, come to… I don't care who the heck it is these days, right? Where you say, you know what, enough is enough. I'm making a decision that I'm not doing this.

00:25:46.330 - 00:25:56.840
Michael Hoch: when I'm in the office, I've done this for a lot of my coworkers in some of the different divisions in our company, and I always do the coffee, right? So we, in our office, we've got one of these nice coffee makers.

00:25:56.840 - 00:25:58.370
Michael Hoch: Right? And I like coffee.

00:25:58.480 - 00:26:14.189
Michael Hoch: But I don't pay for coffee because our employer is nice enough and generous enough to have a great coffee machine. So I make a decision that I'm not spending that money on $6, $7, $8, right? Because, you know, it can happen so quickly. So the snowball, you know, you take, you know, make, you know, take the small payments.

00:26:16.700 - 00:26:25.509
Michael Hoch: on some of them, when you move to the next one, you just kind of do that. The avalanche, make the minimum payments, make extra payments on the highest to get it off.

00:26:25.860 - 00:26:36.139
Michael Hoch: Again, it's just… and again, but you want to look at all the options you have available with regards to debt. But if you're paying off one just to incur more elsewhere, right, it's… it's… again, you have to have that conscious decision that you don't want to do this anymore. And it's, again, it takes a while, but you need to do that. So, you know, you'll look at, in terms of mortgage and HOA fees, right, it varies so greatly.

00:26:52.010 - 00:27:08.530
Michael Hoch: just talking with one of my friends the other day, just about our kids, right? There's a… I guess there's this new thing going around where it's, you're… you're… I forget what it was called. The son-at-home syndrome, or something, where you're getting, like, these 25, 30-year-old boys and young men in particular, right, who are staying at home.

00:27:12.780 - 00:27:30.440
Michael Hoch: As a joke, but it is… I get it. I see what it looks like in the DC area with regards to home prices, incomes, right, all of these things that you want to look. So it's… can you afford it? I mean, too many times I get… I was on a call with a young lady the other day who's, you know, a millennial, and she's like.

00:27:30.570 - 00:27:40.399
Michael Hoch: Destined to never retire, never to buy a home. And when we started backing through and doing the math, right, yeah, is she going to be able to afford a home?

00:27:40.620 - 00:27:42.529
Michael Hoch: Today or tomorrow? No.

00:27:42.550 - 00:27:57.450
Michael Hoch: But if we set realistic goals, I showed her how she could be able to achieve that, and still have enough money in retirement. But she came into it with such a negative connotation that she had already almost self-defeated herself, whereas by the end.

00:27:57.450 - 00:28:05.739
Michael Hoch: Right? There was kind of a glimmer of hope, as they rightfully should have been for her, right? It was her and her husband, they're good savers, they have money, right?

00:28:06.420 - 00:28:08.470
Michael Hoch: I call it Get Rich Slowly.

00:28:08.740 - 00:28:12.899
Michael Hoch: Right? Anyone who tells you that it's gonna be a quick-hit home run.

00:28:13.200 - 00:28:22.439
Michael Hoch: Right? Go the other way, right? I mean, it's just… it doesn't happen, right? It's slow and steady is what you want to do, right? Planning for retirement is a conversation that again, I don't care whether you're in your 50s or 60s, right? You come to me and we can have a realistic conversation with regard to Medicare, Social Security, estate planning, annuities, those type of things, which you should be looking at all of these things and having conversations, right? I tell folks, if you're speaking or you're listening on this conversation, and you've got an annuity that's more than 5 or 6 years old, like, literally reach out to me because you need to be reviewing it.

00:28:47.100 - 00:28:53.390
Michael Hoch: Because the products and interest rates have changed so dramatically, right? The healthcare and the insurance review.

00:28:53.390 - 00:28:57.950
Michael Hoch: Right? My folks who might speak to me in your mid-50s who knows what this is all going to look like in a couple years, but you need to plan, right, if you have a health savings account, right? Those are great vehicles to put money in pre-tax, let it grow tax-deferred, and actually pull it out tax-free for healthcare costs, right? It's kind of the home run of investing, is state and plan… is tax planning.

00:29:15.570 - 00:29:33.590
Michael Hoch: Estate planning is for everyone, right? Everyone, I don't care where you are on this call, I know my co-associates here, Amber and Haley, who are super young, right? Everyone needs to have a will or a power of attorney, advanced medical directives, and just making sure documents are noted.

00:29:33.700 - 00:29:51.409
Michael Hoch: Accounts are titled properly, because, again, you want to… I always say you want to plan when you're calm and you're clear, right? Because we don't make good decisions in times of stress or duress. We just simply don't, right? You want to… but you want to start thinking about all of these things, you know, for you here.

00:29:51.670 - 00:29:53.290
Michael Hoch: As you move forward.

00:29:54.280 - 00:30:02.079
Michael Hoch: Again, remember I should… get rich early, or get rich slowly, excuse me. It's the time in the market.

00:30:02.240 - 00:30:18.220
Michael Hoch: Systematically putting in and saving in your 401 , right? So if you're an investor, and the markets are down like they are today, today's the best day to be getting in, because it's gone down. Again, I talked about your risk tolerance, and your ability and capacity.

00:30:18.770 - 00:30:37.680
Michael Hoch: Take advantage of your employer match. Just a perfect example. The young lady I spoke to the other day, her and her husband were… they made such a conscious decision to pay down their debts that they both disenrolled in their employer's 401 . Well, they each had a 3% match on their 401k.

00:30:38.030 - 00:30:44.430
Michael Hoch: So if they would have each put in 3% of their salaries, which was total about $7,000, the employer would have matched $7,000 of their own money.

00:30:49.450 - 00:31:07.860
Michael Hoch: Like, that's 100% rate of return on your money. You gotta take advantage of that. But you also have to make decisions, right, as to what it looks like, because they're young, those monies could compound and grow so tremendously that you don't want to oftentimes just shoot yourself in the foot and be short-sighted. Right? The numbers…

00:31:08.970 - 00:31:14.820
Michael Hoch: Same thing here when we look at this, right? You'll look at the different charts, the assumptions we use, right?

00:31:15.360 - 00:31:23.330
Michael Hoch: Susan saves $5,000 a year, between 25 and 35. So she saves a total of $50,000.

00:31:24.080 - 00:31:30.450
Michael Hoch: And then at age 65, with compound growth, we're assuming a 7% rate of return.

00:31:30.540 - 00:31:46.530
Michael Hoch: Which, long-term, is very realistic with regards to your investments. Think about it. Who would not turn the clock back from age 25 to 35, save $5,000, let it ride for the next, you know, 35 years, and have $600,000?

00:31:46.670 - 00:32:03.319
Michael Hoch: Like, get rich slowly. If we look at Bill, he saves… now, he waits. Bill waits and says, well, I got a lot of expenses, but I'm… when I'm… when I'm 35, I can save $5,000, you know, until I'm 65. So Bill saves $150,000, but he's got 540.

00:32:06.140 - 00:32:23.899
Michael Hoch: Folks, that is, especially my younger folks, and if you're older and you've got children, beat this into their heads so over and over. Start early and often. Whereas if you take Chris, right, you can say it starts at age 25 and goes through age 65, so it saves $200,000,

00:32:24.560 - 00:32:27.859
Michael Hoch: I have over $1.1 million, right?

00:32:28.500 - 00:32:37.900
Michael Hoch: Gosh, if we knew this, they should be teaching this to our students in school. Not that… again, not following the TikToks and the Instagrams and this and that.

00:32:37.960 - 00:32:55.130
Michael Hoch: Just slow and steady, and if you look, a 7% rate of return, right, is realistic over the last 40 years. And I tell people how many presidents, politicians, all of these things happened, will happen, and will continue to happen, but you want to be an investor into the markets, right?

00:32:55.760 - 00:33:06.099
Michael Hoch: We talk about inflation and education. Man, oh man, could I have a… go on a whole dissertation with what I see with regards to tuition, right? So, I'm in state at Maryland.

00:33:06.350 - 00:33:21.360
Michael Hoch: University of Maryland, you know, all in about $26,000 if you're in-state, whereas, you know, if my son wanted to go to Indiana, because they got a great football program, and it's a good school, right, it's going to run about $55,000 a year.

00:33:22.370 - 00:33:30.399
Michael Hoch: It's hard to justify some of these things. You have to have realistic conversations with regards to what it looks like, and what it's gonna be down the road.

00:33:30.550 - 00:33:31.920
Michael Hoch: You look at the cost of things are going up tremendously, and this is what you want to budget and discuss and look at when… as part of the plans, right?

00:33:40.770 - 00:33:50.459
Michael Hoch: How do you do this? You can set up, again, we're just using this as an example, a 529 plan, a custodial account, a Coverdale savings account. All of these things are good right? At the end of the day, I always say, you're never… if after today, you go back and you start saving more money, you're not gonna come back or call me next year and go, Michael daggone it, I saved too much money, right? You can do other things you might yell at me for, but saving money is not going to be one of them.

00:34:07.560 - 00:34:16.059
Michael Hoch: But you want to make these decisions in terms of where it is. So you can open up… my kids can… I could open up 529 in Maryland, and my son and daughter could go to school in Indiana, Wisconsin, Michigan, whatever, and you could do that. Very flexible. If there's money left over, it can go to another child. Even if beyond that, there's money left over, I could then keep it in their names and keep it for a grandchild who might not even be born. So, a lot of good benefits to it.

00:34:32.420 - 00:34:48.649
Michael Hoch: The saving, the custodial accounts, you understand Coverdale savings accounts that you can do. There's always changes and updates to tax laws and enhancements to all of these things, so again, conversations you want to have, you know, with someone to discuss all of this.

00:34:49.610 - 00:34:59.420
Michael Hoch: Again, this is… I'm kind of old school, right? I have, in my office, I've got notepads and papers all over the place. Multiple ones.

00:35:00.570 - 00:35:03.890
Michael Hoch: And I see it. Everyone's got their apps, their phones, this…

00:35:04.030 - 00:35:19.119
Michael Hoch: But to me, I'm a visual person. I like writing it down and seeing it. It's a great exercise, folks, to go and track, because there's these apps now. It says, how much, you know, how many different things are you subscribed? Well, the thing is, if you do that, you have to sign up, you gotta give them all your passwords and your ID,

00:35:19.200 - 00:35:35.730
Michael Hoch: I don't like that. Just go through your FACOCTA bank statement, and look and see, where am I… where's the money going every month? It's enlightening, right? And do that. And then work with a budget, right? Decide where you're going shopping, right? There's… in the DC area, we've got Whole Foods, Giant, Trader Joe's, Aldi's, right? All of these have… I mean, and the prices for the same items can vary 40 or 50%. It's unbelievable, right? You have to make the decision.

00:35:50.240 - 00:36:04.740
Michael Hoch: Drives me crazy when my wife comes in with bottled water, right? Get a purifier, clean your water, and drink that, right? So look at it. There are apps that can help you with this stuff, but at the end of the day, again, writing your goal, the same thing, right?

00:36:04.860 - 00:36:23.799
Michael Hoch: Old school, writing your goals down, the likelihood of achieving them is even higher than just kind of thinking about them, or having them on your phone. If you write them down and you review it, you'll see it. If you write down where your monies are going every month, and you look at it and you go, holy cow, right, this is what you want to do when it comes to all of this.

00:36:23.800 - 00:36:43.520
Michael Hoch: Again, budgeting methods, zero-based, is just detailed tracking. I would argue that the first step you need to do is you need to understand where the money's going, right? Then there's the income, your 50, 20, you know, 50, 30, 20, in terms of how much you're saving, paying, etc. Pay yourself first, right? I mean, at a minimum.

00:36:43.550 - 00:36:50.550
Michael Hoch: You should… everyone should be participating in your employer's retirement plan, paying yourself first when it comes to all of these things.

00:36:50.790 - 00:37:00.189
Michael Hoch: So you wanna… you gotta kinda take ownership to this, right? If you're not taking ownership, then we're just, you know, it's just a wish and a hope when it comes to all of this.

00:37:00.660 - 00:37:04.479
Michael Hoch: Right? So, again, I think the goal today, hopefully I didn't talk too fast, is understand that the only thing certain about the markets is uncertainty.

00:37:12.600 - 00:37:23.919
Michael Hoch: It's easy to get in debt, it's easy to have foolish spending, but when it comes to setting up your budget and your goals and your wants and your wishes and your desires, you can do it yourself.

00:37:24.110 - 00:37:36.349
Michael Hoch: You can utilize apps, or whatever it is, or you can reach out to someone like myself as an advisor to help having these conversations, consolidating accounts, developing a budget.

00:37:36.720 - 00:37:52.750
Michael Hoch: looking at things coming, looming in the horizon. I've done this a long time, there's not much I haven't seen or heard, right? And again, sometimes I hear some of the crazy things, but you want to kind of be, again, be realistic when it comes to what you're doing and where you're at.

00:37:52.750 - 00:38:00.090
Michael Hoch: In your time horizon, and your age demographic, right? Because it's all… it's going to change quickly.

00:38:00.240 - 00:38:15.330
Michael Hoch: Very quickly, trust me, as someone who's there right now. So, again, I think the goal of today is just to let you know that at NFP, you have resources there to support and help you. You're not on an island by yourself.

00:38:15.330 - 00:38:29.910
Michael Hoch: There are resources, there's people you can speak to, faces you can see, not product pushers that are gonna throw anything at you when it comes to all of this stuff. It's just having realistic conversations, you know, with you and your spouse, or just yourself, whatever it might be.

00:38:30.120 - 00:38:35.980
Michael Hoch: So, I mean, that's, you know, again, our goal is to be here as a resource.

00:38:37.890 - 00:38:43.459
Michael Hoch: You know, there you get me, you see me here. If you'd like to schedule, if you want to have feedback, here's my email. If you'd like to reach out to me, please email me, and we can schedule a time to meet. I don't see any questions in the chat.

00:38:54.580 - 00:39:14.039
Michael Hoch: Hopefully this is helpful. This is the start of our educational series. It's going to be a multitude of different topics, again, and it's just… it's all information. It's just to help you and decipher, because, again, some of these things that I… I sit here and I do these presentations, and you should see some of the obscure topics and things I get pushed on my feeds.

00:39:14.040 - 00:39:17.179
Michael Hoch: I get it, right? But there's no magic to this. It's slow and steady wins the race.

00:39:21.280 - 00:39:25.999
Michael Hoch: So, I don't see any questions. Hopefully this was helpful. Hopefully this was 35, 40 minutes of time well spent, for you. You know, please reach out to me and, let us know if there's anything that we can do to help you.

00:39:37.730 - 00:39:43.149
Michael Hoch: I really appreciate your time, and We'll go from there.

00:39:43.620 - 00:39:45.879
Michael Hoch: I see some information there. Wonderful.

00:39:47.070 - 00:39:50.750
Michael Hoch: Thank you all, I appreciate it. Have a great day. Stay warm.

00:39:51.220 - 00:40:01.160
Amber Posthauer: Alright! Well, thank you, Michael, for sharing your valuable time and expertise with us today. To reiterate, today's presentation was recorded. We will be sharing the recording in the coming days.

00:40:01.250 - 00:40:17.510
Amber Posthauer: At the end of this call, a survey will populate in a new window. Please take a brief moment to complete the survey, as it lets us know what topics are important to our listeners, and helps make our education program as current and relevant as possible. That concludes our webinar for today. Thank you, everyone, for joining us, and have a great day!