This is not my first post about attending a seminar or webinar with the stated objective of addressing attendees’ concerns about required minimum distributions (RMDs) and income taxes in retirement. I have gone “undercover” several times before to check out seminar venues as well as the accuracy of content being presented and how well seminars adhere to their marketing messages.
Once again. I was disappointed. A seminar held at my 55+ community targeted me and my fellow residents with a series of Facebook ads. After registering, I received an e-mail confirmation that included this paragraph: “This workshop is not a sales pitch in disguise. Our primary objective is to help you get your questions answered so you can live a healthy and wealthy retirement.”
Sadly, this was not the case. Within four minutes of the seminar’s start, the presenter started describing his company’s services and encouraging attendees to “come sit down with us” to discuss their finances. He also used the phrase “what we do” at least several dozen times. Below are some additional Barbservations from someone who has been a professional financial educator for 47 years:
Lots of Unexplained Terms- The presenter used many financial terms without explaining them and I wondered if many participants understood what he was saying. Case in point: effective tax rate. He never explained that this is the percentage of tax owed on a person’s total taxable income and is calculated by dividing taxes owed by taxable income (e.g., $7,000 ÷ $50,000 = 14%).
Very Small Font Sizes- Whether this was intentional or not, the slides that were presented were very difficult to read. Any seasoned financial educator would never make this mistake. I was always taught to follow the 6 x 6 rule when preparing PowerPoint slides: limit each slide to no more than six bullet points and limit each bullet point to no more than six words.
Scary Stories- Designed to get people to hire his company, the presenter told stories about the “widow’s tax” (i.e., the change in tax filing status from married filing jointly to single after a spouse passes away) and the “kiddo’s tax” (i.e., the requirement that non-spouse beneficiaries of tax-deferred retirement savings deplete the account and pay taxes on their inheritance within ten years). The speaker implied that only a financial advisor could help people navigate these challenges.
Correct Information- In between sales pitches were nuggets of solid personal finance information:
• The biggest fear of older adults is running out of money during their lifetime
• Common reasons that people run out of money are taxes, market risk, and long-term care expenses
• Proactively managing taxes is preferable to a passive “I’ll just take my RMD” approach
• If there are things you want to do in life and you have the money, do it now and don’t procrastinate
• Risk tolerance is feelings about investment risk; risk capacity is how much you can afford to lose
• People don’t necessarily need long-term care (LTC) insurance products but they need a LTC plan
• There can sometimes be decades between when people create estate plan documents and when they use them; it is important to review your documents periodically and update them as needed
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