5 Ways a Texas Financial Advisor Helps You Make the Most Out of Your Retirement Funds

Most people want to retire at age 65. But do you have a plan with your financial advisor that meets your values? Retiring in Texas has several financial reasons why you should consider it. Darryl Lyons, President of Pax Financial, explains why you should consider retiring in Texas. In this episode, he explores the Top 5 reasons why you should hire a financial advisor from Texas, if you’re going to retire in Texas.


Show highlights include:

  • Why paying a higher property tax rate reduces your monthly bills (even if you live in your dream house) ([1:20])
  • The “Texas Long-Term Healthcare Insurance Partnership Program” that doubles your health insurance value before using Medicaid ([4:15])
  • How having flood insurance during a drought protects your family ([8:53])
  • Why aligning your money and values lets you give 10% of your income away ([10:43])




Suppose that you like guns and you want to buy a 9-millimeter or a 20-gauge or a 12-gauge. You tell your financial advisor, I’m gonna use money. I’m gonna buy that. They’re not going to look at you weird because that’s just kind of the norm in Texas.

Do you want a wealthy retirement without worrying about money? Do welcome to the Retire In Texas Podcast, where you will discover how to enjoy your faith, your family, and your freedom in the state of Texas. And now here’s your host, financial advisor, author, and all around good Texan, Darryl Lyons.

([00:36]): Welcome to Retire In Texas podcast. My name is Darryl Lyons. I’m the co-founder of PAX financial group in San Antonio, Texas. PAX financial group is a sponsor of this program. Visit PAXfinancialgroup.com. Before I get started, I need to share the legal dreaded disclosure. This material contains general information only and is not intended to provide specific investment, tax or legal advice. Visit PAXfinancialgroup.com for more information, investment advisory services offered through PAX financial group, LLC. Okay, so this show Retire in Texas podcasts. We’re going to count down the top five reasons you should hire a financial advisor from Texas, or at least understands Texans because there’s some material differences between Texans and maybe other states that if you haven’t figured that out yet, the number five reason you should hire a financial advisor from Texas, or at least knows Texas, or at least their team knows Texas.

([01:27]): The number five reason is they’ll know the income taxes in Texas. And so if you haven’t figured it out yet, Texas does not have a state income tax. So those that are living in California and New Jersey and Oregon, and having to pay for ridiculous costs, that don’t make any sense. They’re having to pay a state income tax from all IRA and 401k distributions that they need to meet their standard of living. And they’re paying this extra state tax on it, Texas that doesn’t exist. So the other states say, well, you’ve got high property taxes and that’s true. Texas has the sixth highest property tax rate in the country, but it’s a rate. Remember a rate is applied to a valued. So suppose it’s 1.8, 3%. It’s applied to a value in 2021. The property values, the median property values across the country. Follow this in California.

([02:19]): There are 500, 5,000 in New Jersey. They were 335,000, but in Texas, the median home price was 172,000. So even if the rate was higher, it’s applied on a lower value. Now everyone’s moving to Texas. So we all know those values are going up. So that may not last forever. I had a friend from California move here and they owed a little bit on their home. They had modest income and they sold that California home and bought a couple acres, beautiful property. They could probably hunt on it. Lots of elbow room, no nosy neighbors, right next door, Texas stars, beautiful pay cash. That’s happening all the time. And it’s cool, but it’s not cool. I mean, if you’re selling your home and you get a nice value, that’s fun. But after a little while, we’re all kind of scratching our heads saying, Hey, can this continue for now?

([03:10]): It’s good. And you property taxes. If you move here. Yes, the rate’s high. But right now the values are still much slower than many other states. Now, the other thing to know is at 65, they have something called a senior freeze. Not many people know about this, but that means you don’t have to pay your property taxes, but the better, more accurate way to explain it is you get to defer your property taxes, meaning let’s say 65, you’re completely broke and you have poor health. And so security is not covering your bills. And you are looking at your property tax bills and saying, I can’t afford this. What you can do is you can tell the state I’m going to freeze my property taxes, but they’re due at your death. So your state has to pay it. And there’s interest involved. I don’t advise that very often because it’s a situational decision.

([03:55]): In other words, you really have to be in a tough situation. And you know, you get your homestead exemption. So for those who are over 65, the property tax rates pretty reasonable, but there are some people that need to use that senior freeze and have their kids pay their property taxes versus their own using their own discretionary income. So that’s unique to Texas. Number four, the fourth reason that a financial advisor in Texas is probably the right financial advisor for you is they’ll know a little bit about healthcare in Texas. Now Medicare is a federal program, which it’s going broke, but it’s working for our clients. Look, we help a lot of clients with Medicare and the Medicare system works well. I mean, it’s driving physicians nuts because of the bureaucracy involved and the limitations on the services that can be provided. So it’s definitely messing up the medical system, but generally speaking, those who are 65, you get Medicare three months before there’s an enrollment period three months before the month of, and three months after you turn 65.

([04:54]): And so Medicare generally speaking with, along with the supplements works pretty well for our senior clients. And so we have no problem recommending Medicare and supplements, and many people who are military have Tri-Care. And so it’s a combination of different coverages that really work well, but Medicaid, you need to know the difference between Medicaid and Medicare. Medicaid is a state and federal program and I’m in California. They call that Medi-Cal. And in order to qualify for Medicaid, you have to spend down all your assets. So you have to have less than $2,000 in assets. You can’t have, you have to have really low income. Medicaid covers chronic care like nursing home, or inability to eat bathe dress toilet transfer, which Medicare will cover. Colds are broken arms, right? Acute issues. So Medicaid is a federal state program. So trying to understand how those different Texas is important and your financial advisor should help you navigate that.

([05:47]): Now, some people may buy long-term care insurance to cover those costs. What’s cool in Texas is Texas has something called a partnership program where if you buy long-term care insurance and it has to be a certain type, it’s not a big deal, but you have to make sure you don’t mess up on the type of long-term care insurance. The state of Texas will match your long-term care insurance before you have to spend down your assets to get Medicaid. So let me say that again. You buy a qualified long-term care insurance program, let’s say at 55, and it’s a partnership eligible long-term care insurance program. The state of Texas will match that pool of money. So suppose it was $300,000 worth of insurance coverage. The state of Texas will match that before you have to spend down all your assets to get Medicaid. So it’s a way that the state of Texas trying to encourage its residents to buy long-term care insurance, that’s called a partnership program.

([06:38]): Hopefully your financial advisor can help you with that. Okay. Before we jump into number three, I want to make sure you go to PAX financial group.com, grab our eBook retire in Texas eBook. It’s a way to kind of nudge you into our community. So that way you can start getting a lot of our resources and hopefully we can guide you and help you as you navigate and transition into retirement. Okay? So number three, they’re going to know other people, you know, it’s funny because Texas people stay in Texas. This is from pew research, three quarters of adults born in Texas, still live in Texas. So three quarters of adults born in Texas, still live in Texas. And I guess you’d call that Texas Hold’em dad joke. Sorry. But yeah. So if you’re a Texas resident, you should know people, especially if you’re a financial advisor and it’s important that financial advisors know attorneys, we talked a little bit about Medicaid.

([07:28]): There are some Medicaid trust where you can shift assets over to Medicaid. It’s very strict. The rules are strict, but knowing an attorney is important, hopefully your financial advisor can know the right attorney. So you’re not going to like a criminal defense attorney to get this work done because it is very specialized. A good CPA should be a resource for you through a financial advisor in Texas. What’s cool about Texas is Texas has no death tax. So if you do have a CPA, there’s not going to be a need to worry about the debt tax, which is a very stupid tax, but it is in Nebraska at 18%. Maryland’s 10%. So that means if you die, not only could the federal government apply in a state tax, the state could also apply a death tax as well. Texas does not have a death tax. That’s keep it that way.

([08:12]): A good financial advisor may also know some dentists, the pharmacies, which is, you know, peripheral in the role of financial advisor, but you know, it’s helpful if they do know. So that way they can point you in the right direction. Also banks and credit unions, the differences to good Texas financial advisors should know the difference. Now there’s a lot of credit unions in the San Antonio area. They’re really good for typically less complex transactions like auto loans, or maybe even CDs. The rates are a little bit higher, but when you get into like jumbo loans or business loans, where you need a little bit more handholding and some personalized attention to customize the loan, you’re going to probably want to work with a bank, but knowing the right people. And if a Texas financial advisor pointing you in the right direction is important. Number two, good Texas financial advisor will understand the weather.

([08:58]): Now at least empathize with you. You know, we recently in 2017 had a hurricane cat for Harvey, devastated our friends in Houston, Louisiana, they’re still rebuilding. They’re still trying to get insurance money. They’re still trying to put things back together. During that event, I asked one of my clients in Houston who was going through that and I said, look, you’re in the thick of it. Would you mind just communicating with me the top 10 things our clients can do to prepare for a natural disaster event while it’s fresh on your mind? So she was able to articulate that information to me and I summarized and passed it out to our clients. So that way we can get in front of the next natural disaster. And some of the things that she suggested was taking pictures of stuff, buying flood insurance, and of course, keeping cash on hand because a lot of the ATM’s and credit card machines are down during that time.

([09:46]): You know, we recently in San Antonio and south Texas dealt with something called snowbird, what was we call it snowboard. You get piles of snow. It was fun for a few days. And then the power went out and a lot of people lost their dear me, but most importantly, some people really got sick. I believe there was even deaths involved if I recall. And the electronic reliability council of Texas, they, I mean, they were under fire. People, took their pitchforks up there and try to figure out why Texas residents didn’t have power for multiple days in the freezing cold. It was a bad event. I say all that because of Texas adviser at the very least can empathize with you, but understand why you may need to take money out of your account to supplement things or fix things. And there, you know, there’ll be an understanding and, and at least empathy, because they are in the financial advisor is going to walk life with you.

([10:31]): So they need to understand that the good news is, is most of Texas doesn’t have a lot of natural disasters. The heat is our biggest thing during the summer months, but nothing that Comal river or a lake LBJ can’t solve. The number one reason that hiring a financial advisor in Texas, and this is my countdown, and I’m very passionate about this. Number one reason. The number one reason is a very, very likely that that Texas financial advisor, that financial advisor who’s understands Texans. It’s very likely they share your values and having your money and your values aligned. I can’t understate how important that is having a disconnected is almost hypocritical. And so I want you to consider saying, Hey, if what I’m doing with my money, what I plan to do with my money is that aligned with what is important to me and people are asking themselves that all the time now, but suppose that you like guns and you want to buy a nine millimeter or a 20 gauge or a 12 gauge.

([11:26]): You tell your financial advisor, I’m going to use money. I’m going to buy that. They’re not going to look at you weird because that’s just kind of the norm in Texas. In fact, they might even say, Hey, you might want to get insurance. That there’s an insurance called law shield out there. That is suppose that you are in a situation where you have to defend yourself and you need legal protection to support the situation that you put yourself in, or you at least defended yourself in Texas law shield can help you with that. So they should be able to help you navigate some of the, even the gun issues over the last 12 months. I can’t tell you how many ammunition conversations I’ve had and clients coming to up to me and say, Hey, I found out they had ammunition at academy on Thursday mornings.

([12:04]): And those are interesting conversations, but aligning the money with values is really important. And people in Texas love land too. So the dialogue about how much things cost per acre, I had a client recently said, Hey, I just bought a 500 acres for 1900, an acre, pretty good deal. That’s a lot of money. If you do the math, you know, that’s not uncommon. And people will take distributions out of their investments and their mutual funds to buy the land. And a financial advisor may ask questions, but they get it, you know, lands important. There’s that new country song by dirt makes me think of that. But you know, land also berries, right? If I buy land in rock Springs, it’s going to be considerably different than Bernie. And so having that dialogue with a financial advisor from Texas is important. A really important value that I find to be prevalent in Texas, or at least respected is giving.

([12:51]): I have a client who every year we look at the growth on her investments and she gives 10% to the church as a part of her tiding rhythm. And, you know, I just send it directly to the church. Many times that’s not uncommon or a situation where somebody might put their church or ministry as one of their beneficiaries in their will. And those things are not weird. Those are normal things. And I respect it and I encourage it, frankly. So having a financial advisor in Texas who can understand empathize and even encourage aligning your money with your values is I think an understated relationship if you’re looking for a financial advisor relationship going forward. So I hope that helps us the top five countdown. Let me recap those top five reasons that hiring a financial advisor who understands Texas is important. Number five, they’ll know the state tax laws, which again, there’s no state tax laws, property tax, yes.

([13:45]): Number four they’ll know the healthcare and how to navigate that. And we talked a little bit about that partnership program. Number three, they’ll know the community, including attorneys and CPAs. Number two, they’ll understand, or at least be able to empathize with the weather conditions. And number one, I’m hoping, and I’m confident that many Texas advisors will not only share your values, but very least respect your values. I hope that helps. Thanks for listening to retire in Texas podcast, grab our eBook PAX financial group.com. There’s a retiring Texas eBook. You’ll see it right away. Grab that. If you have any questions, go on our website, you can shoot us a question that way. And I just want to remind you that you think differently when you think long-term. Have a great day.

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