Dear Ladies and Gentlemen,
As the CEO of a Risk Management firm, I have made the decision to reopen our operations. After looking at the science and assessing the risk, I decided to end the “lock down” beginning May 15th. If you want to schedule a consultation, please call Philly at 1-888-753-6664. Speaking of Philly, please see “Employee Spotlight” on page two (2). She has been with me for several years and deserved to be recognized for her loyalty, hard work and devotion to our firm. Many of you have never met her unless you attended one of our company events or seminars. Hopefully, this will allow you to get to know her better, so instead of me doing a profile she will give you a brief history in her own words.
Before we begin, I wanted to answer some of the questions about our plans to reopen and our expansion to NJ.
Consultations: I plan to resume face to face consultations beginning May 15th, following all CDC protocols to ensure the safety of everyone involved. Although we were considered an “Essential Business”, in April I made the decision to cease client contact for 30 days. After watching the economy collapse, 30 million fellow Americans lose their jobs and the stock market have its worst quarter since 2008, I felt it was time to get back to work helping my clients and their friends protect their life savings. Just last week a lady called stating that she lost 1/3 of her portfolio due to the market collapse. She is 67 years old and needs the income from the assets to supplement her lifestyle. She stated her advisor told her “Don’t worry, we are in this for the long run!” She replied, “We who, it’s my money and I want it protected!” She asked when I could help her, so now is the time!
NJ Office: We had to delay the opening of our NJ office due to the virus, the expansion will happen in early Fall. The decision to expand was based on one reason, “Demand”. As many of you know, I am very involved with the Portuguese Community in Palm Coast. For the past 11 years I have been devoted to helping promote the Portuguese Culture and their charitable endeavors. Most of my clients of Portuguese descent had retired after spending many years working in the Labor Unions in the Northeast or as business owners. This in turn led to forging relationships with Portuguese Media and management in several of the Labor Unions in NJ and NY. I decided it was time to expand and open an office in Newark, staffing and office space were in the works prior to the outbreak. Like I said, this will go forward as soon as possible. By the way if you want to join the Portuguese Club, contact our office and I will send you the paperwork, there are many events that I am sure you would enjoy!
Fred’s List: Weekly I am asked who I should use for this service or that. I decided to compile a list of privately owned businesses here and in the Northeast that I know provide reliable services. If you know of a business owner that would benefit from being on our list, please email their business name and contact information to Kevin Mockel at firstname.lastname@example.org and we will add them. Our goal is helping our friends in these difficult times to stay viable; we will put them on our company Facebook, please do the same. These owners need our support, so please give them your business if possible.
I look forward to our future and the pursuit of helping as many people as possible protecting their life’s work. I will keep you up to date on the seminars, be safe and God Bless.
Freddie Hackney, CEO
Hackney and Associates
Employee Spotlight: Philly Rose
Philly Rose: “I was born in the summer of 1961 in Bainbridge MD. My father, who is now deceased served in the U.S. Navy and my mother is a writer and currently lives in central CA. My father was transferred to San Diego where I grew up spending days at the beach and deep-sea fishing with my father on his boat. My mother had me enrolled in SAG and I did some modeling, singing and was involved in music and our Church Choir. I still play the guitar and flute, thanks Mom! I had always desired to be in the Aviation Industry, so I took flying lessons and went to work as an Airline Professional and spent 12 years in that industry in CA. Leaving that business I got educated in the Beauty Industry and became the first Manicurist at one of the top resorts in Palm Springs and had an A-list clientele. After leaving CA I made a left turn up to Maine and Explored the “Wilderness” side of life for a couple of years and quickly got tired of the snow. I decided to move to Florida where I met Freddie Hackney who offered me a new career path 6 years ago. I became a fully licensed Health and Life Insurance Agent and was promoted to Executive Office Manager in 2014. I really enjoy working with our clients and developing new strategies to grow this business.
I must add that Philly was instrumental with developing our New Smyrna Beach territory. She is a valued and cherished member of our team and recently moved to Plantation Bay in Ormond Beach where she has become an avid golfer!
Each year most of us file and pay our “Fair Share” of Federal Income Taxes to the tune of thousands or tens of thousands of dollars. The biggest tax that will be due however does not have your signature on the return, it’s that of your loved ones when they inherit your “Tax Qualified Plans”. These include IRA’s, 401K plans, 403b, Thrift Savings Plan (TSP), TIAA CREFF, VALIC to name a few. The money grows Tax Deferred but is fully taxable at death when it passes to a non-spousal beneficiary unless the proper planning occurs. If the money is taken in a “Lump Sum” the custodian informs the IRS that a fully taxable distribution has occurred. The taxes are due when the heirs file their returns for the year in which the money was received. This triggers a “Tax Bomb” that explodes resulting in huge tax hit to the assets. The heirs then write a check and here’s the saddest part “DON’T GET A RECEIPT” that breaks down where the money goes. Think about that, even if you purchase a stick of gum you are given a receipt. When you send the IRS tens of thousands of dollars there is absolutely no “Accountability”. Then you have to hear the leaders from both parties in Washington lecture you on paying your “Fair Share”, this is sickening. I don’t know about you but I feel certain that I have paid my fair share but thought I would do a little research to see exactly what happens to some our hard-earned money that goes into the Washington abyss. Then I am going to show you how to minimize this debacle when you pass your tax deferred assets to your loved ones.
According to the Government Accountability Office (GAO), you might be shocked of the waste and abuse of your tax dollars: (1) Unrecognized Transactions: these are transactions the accountability office cannot account for 24.5 Billion (2) Unused Flight Tickets by Government Employees: Purchased 100 million dollars of Airline tickets that were either duplicate purchases or unused by the government employees (3) Credit Card Abuse by Department of Defense Employees: their government issued credit cards were used for: concert tickets, gambling, cruises and exotic dancers. Over an 18 month period the number was approximately $102,000.00. That’s just a sample of where your money is going, this is ridiculous.
You and I can’t fix Washington but you can take the steps to legally protect your IRA and other tax qualified assets from funding this nonsense. As most of you are aware, once you turn 70 1/2 in most cases the Government requires that you begin taking mandatory distributions from you IRA (RMD’s).
The amount is determined by the account balance the previous December 31st and the IRS life expectancy tables. When I am working with a new client that has money in these types of accounts I always ask them for the analysis provided to them by their existing advisor as to what the distributions look like now and at their death. The answer is always the same, not only have they no idea of how much they are going to have to take out mandatorily, there has been absolutely no plan to prevent a tax disaster when they die. The next question I ask is “How do you feel about that?” Most will tell me “Fred I had no idea that the tax bill was going to be that high.” My next question is “If I could show you how to protect the assets while living and minimize the tax impact at your death, will you move the money to my care?” I get about 98% that say “yes”. The other 2% just don’t believe me. These are IRS codes and rules however opinions in this instance can have severe consequences.
There are multiple reasons for loss on the accounts, here are a few. First, in my opinion the money in your Retirement Accounts is sacred. The money should “NEVER BE AT RISK OF LOSS”, it’s a retirement account for goodness sake. This is money it took decades to accumulate and can vanish due to market risk overnight! Secondly, I can’t do an IRA analysis on money that could disappear. How is someone going to tell you approximately how much you have to take out while you are living if the account balance each year looks like it’s on a rollercoaster. Also, the tax planning doesn’t matter if I you don’t know what the balance is going to look like when you pass. To demonstrate the benefit of advanced” IRA” preservation planning, here is a recent example. A couple I recently
visited had an IRA balance at risk in mutual funds in the amount of $500,000.00. They told me that they no longer wanted to gamble with their life savings in the stock market and asked if I could help them. I showed them that at a 6% projected growth rate that they would have to take out between ages 70 1/2 and 85, $489,000.00 from the account in mandatory distributions. This would leave an account balance to their heirs of $660,000.00. After the heirs pay taxes of approximately $244,000.00, they would inherit $416,000.
By implementing “Wealth Preservation Planning”, the account could grow without risk of loss while they are living and a 2nd death the beneficiary would be an “IRA Qualified Trust”. The money would remain tax deferred, protected from many of the unknown perils that can happen to their beneficiaries. These can come in many forms such as: divorce, disability, death, tax problems, minor grandchildren, spousal influence to name a few. The trust would divide the money into separate accounts for the heirs and paid out over the life expectancy of each beneficiary. In the case of this couple, their children and grandchildren would receive over $2,000,000.00 verses $489,000.00 before the advanced planning. To say the least they were thrilled, not only was the account protected from market risk while they were living but devastating tax loss when they pass. The law firms that I work with can design modern trust, but the most important part of the planning is preserving the assets that go into the document. The most advanced trust in the world won’t matter if there is nothing to protect!
I am not licensed to advise anyone on being in the market, selling their positions or managing their market assets. Like I said before, I left the securities business many years ago. My job is to help my clients manage “Risk” on the money while they are living and refer them to the proper professionals to develop asset protection beyond the grave. The options are out there, but you must be educated in order to make an informed decision. Without the knowledge, you risk a significant portion of your life savings being used as “Entertainment Slush Fund” distributed by the elites in Washington!
If you own any of these types of assets and want to be proactive in the planning call Philly at (888) 753-6664 and schedule a complimentary consultation.
I hope this letter finds everyone in good health, these times are troubling but hopefully will be over soon. Due to the virus we have suspended seminars until May, we will reassess the situation at that time and keep you informed. If you need our help concerning your existing accounts or to schedule a complimentary consultation in May, please call Philly at 1-888-753-6664 and we will be glad to assist. If you are not yet a client of our firm, we can do extensive preliminary planning prior to your consultation, so please call or email Philly and she will forward you a “Consultation Checklist”. I will follow up immediately in preparation for your appointment. Most everything that I do can be accomplished over
the phone, although as you know I would much rather see you in person. Therefore, if you want to address any of the risks listed on page two (2) call Philly and I will get right back to you. Although I have been visiting clients the last two weeks who were truly in need of help due to a death in their families, I must stop this activity for now until things clear up. My plans are to resume my normal schedule of face to face meetings at the first week in May. Again, if you need our help, please call Philly and she will relay the message. The insurance companies that we work with are fully operational, including their customer service departments.
On page two (2) I have listed some of the more common risk management issues that I have seen in the past few months. So many people ask, what is it that your firm actually does to assist clients? That's why I went into more detail. Over the past several weeks I have received many referrals, if you know someone who you think would benefit from our services it would be an honor to help them. Over the years we have developed relationships with many different professionals to help our clients in their areas of expertise. I am calling it Fred's List. You will also notice that I included some business owners in NJ for I have established many relationships over the past several months and wanted to acknowledge them as well. If you own or know of a business that would like to be included, please email Philly at email@example.com and we will add them. Our goal is to help our friends so they can stay in business in these trying times.
My clients have been sending notes of gratitude for the work our firm has done in protecting their life savings. To follow are a couple that we received last week. The first was from Greg Frazier who lives with his family in Bartow, GA and worked for many years as a Safety Director in the Kaolin Mines. Kaolin is a mineral used in many products and mined from Georgia clay in Sandersville. Its main use is in the production of paper products to ensure their “Gloss.” I met Greg a few years ago when he was referred his friend Jack Hutcheson. He was retiring soon and wanted to protect is 401K from market risk. He eventually became a client and recently sent me this text “Fred so glad my money is not in the stock market! Thanks for your expertise in managing the risk in our family's investments”. Another one that I received was from Joe and Meg Doherty. Meg is a retired surgical nurse and Joe owned a Pharmacy in NY. They retired and moved to Florida, attended one of our seminars and became clients. Meg wrote “Fred thanks for protecting our life savings and our dignity as well.” Wow, these words really reiterated what we do and how important it is.
Our clients have placed their faith in our expertise in helping them manage the many financial risks they face now and in the future. Thanks also must be given to the law and tax firms that assist us in the plan designs that are so important. Knowing that our clients have not suffered any market losses, their estates are set up properly to avoid conflicts at their passing is quite rewarding. If you want to schedule a complimentary consultation regarding your situation, please call Philly at 1-888-753-6664. I plan on seeing clients in person beginning the end of April or early May. Please say a prayer for all the Union Members, First Responders and Health Care Providers that have to go to work to serve this Great Nation. Again, on page two (2) I have listed a summary of the “Risk Management Services” that our firm provide and page three (3) a list of professional affiliates. Hope you find it helpful!
Risk Management Services Provided by Hackney and Associates
Below is a list of "Risks"; that we help our clients manage, remember that I am or can be licensed in every State. If you or someone you know needs our help, please forward this letter to them and like us on Facebook!
1. Eliminating Market Risk: With the stock markets taking their biggest hit since 1987, it is more important than ever to protect your life savings from decline. We position our client's financial assets to grow without "Risk of Loss". All gains once attained are "locked in" annually and can never be lost! Also, many of the insurance companies that we represent have premium bonuses that increase the initial investment by up to 7% depending on the client's age. They also come with "Income Riders" that ensure
that the account grows regardless of market performance, currently 6%-7% compounded daily! Many times, I hear "Fred, I am going to wait until the market comes back to contact you!" Remember LINCOLN CAME BACK AS A PENNY!
2. Long Term Disability: Long term disability can threaten the most laid out plans due to the cost of home / nursing home / assisted-living care. Our plans can be designed to supercharge the income riders in the policies to help pay for this much needed care taking tremendous amounts of stress off spouses and family members.
3. Retirement Plan Preservation: If you are currently working or retired, in my opinion, your IRA/401K/TSP/403b and other retirement assets should never be at risk of loss. Many employer plans allow an "In Service Rollover" to an IRA and still allow the employee to contribute to their current plan until retirement plan with the company match if you 59 ½ years of age or older. This allows the employee to take up to 100% of their current plan out of harm's way and grow the account without risk of loss.
4. Income Planning: We specialize in creating life income options, especially when we see loss of income due to pension and social security at the death of a spouse. Remember you can't get a guaranteed income from an account that's not Guaranteed!
5. CD Alternatives: The interest on CD's is taxable as ordinary income whether reinvested or not. The
rates are terrible, and billions of dollars sit in these accounts. We can show you how to significantly increase your return, the interest is “Tax Deferred” and the principal is secured by some of the most financially secure insurance companies in the United States. Above is just a sample of how we help our clients, please visit our website and read the many testimonials that tell our story. Contact Philly today 1-888-753-6664, she will relay the message and I
will call you.
Sometimes following the “Crowd” can not only lead you in the wrong direction but as you will see can endanger you financial wellbeing. After suffering three severe bicycle wrecks over a 20-year period I no longer ride, that getting in shape thing almost got me killed. However, in 1997 while taking a bike ride in the country near “The Villages” and following my typical route, my destination was very clear. I had taken the same route dozens of times and was very certain that I was going in the right direction. About half way through the ride I noticed a loan rider approaching in the opposite direction and as he passed he screamed at me “You’re going the wrong way”. Not sure what to make of it I kept on pedaling but then several more riders approached me with the same message “The Finish line is ahead, you’re going the wrong way”. They were in a bike race and thought I was in it also and had gotten turned around. For the next hour I had to endure people yelling at me to turn around and follow them it was quite comical and after a while I just ignored their warnings and kept pushing forward in what I was certain was the right direction.
The moral of the story is do not follow the crowd they’re not always right especially when it pertains to your financial health. With the stock market seemingly on a never ending spiral upwards many tend to forget that it can also go south very quickly. It’s like the gambler that goes to Las Vegas and tells you how much they won but doesn’t mention the losses in prior trips! I have seen this play before in 1999, 2000, 2001 & 2008. Everyone seemed to be intoxicated with the gains they were making but ignored the inherent risk’s associated with investing in assets that carry no “No Guarantee’s”. Just this past week in meeting with the son of a client who was getting ready to retire he told me “Fred I have lost 1.97% this year in my 401K plan when on T.V. the experts say everyone is making money. How is this happening when the plan is being managed by one of the biggest firms on Wall Street”?
You must realize that many of the so-called experts you see on television and radio have never met with individuals like you and have never managed money in a highly volatile environment. They also work for firms that direct them as to what products they can offer for they are under contract. Next time you in the bank read the sign that is displayed in front of the advisor’s door. It will read something like “Securities offered by are not insured by the bank. These products are not obligations of this bank, are not endorsed, or recommended, or guaranteed by this bank or any government agency. The value of the investment may fluctuate, the return of the investment is not guaranteed, and LOSS of principal is possible”.
Why any retiree would place their money in these types of assets is mind blowing but it happens every day. What do you mean that these assets aren’t recommended by the bank, the advisor works for a firm that is contracted with the bank. It’s all designed to minimize the bank’s liability.
When meeting with potential clients I warn them that if they decide to move their money from an existing advisor there will be some push back. Remember the brokers make their money two ways (1) fees on the money under management or (2) commissions on transactions in the account. A few weeks ago, I was meeting with a couple who
had attended a recent seminar. When I asked what their concerns were, they shared that they couldn’t afford and didn’t want to risk losing any more of their money in the market, especially the money in their IRA’s. They felt that the stock market was unsafe and wanted the money taken out of harm’s way. They had been concerned about the risk for many years but really didn’t know where to place the money or who to trust for advice. The recent rollercoaster swings in the markets was very concerning and scary. I told them that before I could help them, they would have to call their advisor and liquidate the accounts to the money market. Once the liquidation occurred, then I would send the transfer
paperwork to the company. Again, I reminded them that the broker would not be happy with their decision and would do everything in his power to prevent the transaction. Upon calling the broker they were grilled concerning their decision. Some of the questions were typical and some were outright insulting. He asked: Why were they liquidating the account? What type of asset were they going to purchase? Were they being coerced? Who was the new advisor? What company did they work for? Were they sure about the decision? Had they checked out the advisor and company? The most disturbing questions was “Are you sure you are not senile?
Folks, I have been working in this business for a long time as both a stock broker and insurance agent. I have never in my life experienced such disrespectful behavior. In 2004, I left the brokerage business because I could no longer in good conscience place my client’s money at risk in the “Wall Street Casino.” The other reason I relinquished my securities license was that I began working with clients who were older and couldn’t afford the risk associated with the markets. However, when someone called to liquidate their account, I did so without question. I felt it was their money and their decision, period! Both clients were infuriated with the brokers response and demanded their accounts be liquidated so the transfer could take place. The sale order for the securities was executed later that day and the money was eventually transferred.
I never tell anyone what to do with their money. My goal is to build a relationship through trust and service. It always amazes me why anyone would insult the intelligence of a client and burn the bridge on the relationship. Last year 50% of my new business came in the form of referrals, for which I am very grateful. Just last week a client’s son called me from PA wanting me to help him with transferring his 401K that he had from a past employer. If you know someone who would benefit from our services, please have them call the office (888) 753-6664 to schedule a complimentary consultation. I will always be respectful and remember who is the boss, that’s you!
Every day I meet with potential clients and I when I ask them what they did for a living they never say, “I was a professional gambler!” Having worked as a broker for the first 20 years of my career, it’s my opinion that placing your money at risk of loss in the market is not investing but gambling. I am no longer licensed to advise anyone to buy, sell or hold their positions in risk assets. My job as an insurance agent is to minimize the risk of loss in my client’s estates. In 1997 I advised all my clients to move their money out of the markets into guaranteed insurance-based assets. Since that time, they have suffered no market losses!
If you have ever taken a trip to Las Vegas, the first thing you hear when arriving at the terminal is the sound of the slot machines and the roar of “it’s a winner.” This is done to make you believe the everyone is a winner and to entice you to place bets. Upon arriving at the Casino your room is comped, and alcohol is free. You might notice that there are no clocks or windows and few balconies. You are greeted by flashing lights and overwhelming noise to create an atmosphere of excitement. Again, this is done for the purpose of
separating you from your money. Most people who visit the Casinos walk out losers.
Wall Street is much like to gambling establishments, the Brokerage firm is the (Casino), the broker is the (dealer) and you the investor are the (gambler). You place your bet on stocks, bonds, mutual funds or variable annuities hoping to win a jackpot. Like the Casino the brokerage firms and brokers win either way via fees on your accounts. If the markets go up or down, the house always wins.
Just this past week I met with a gentleman who lost $70,000.00 in his brokerage account in just one day due to market volatility. He told me that he did not make that in an entire year when working. When he called his advisor, he was told “Don’t worry we are in this for the long run.” Who is we, the broker didn’t lose any money! The client told him that he’s 75 years old and doesn’t have a long run left. I asked the gentlemen how much more he could afford and wanted to lose, and the answer was none. He called the broker back and liquidated his account. Brokers are trained just like I was to keep your money at risk by telling you things like “It’s only a paper loss” or “The markets always recover”. They like me have no idea what the markets are going to do from one day to the next and will have their talking points ready to combat your concerns.
You can’t even go to the bank today to cash a check without someone asking you “Do you want to meet with our financial advisor?” Before you say yes you better read the disclaimers on the signs outside.