Plan Your Third Act: Financial Freedom and Reinvention After 50 with Katana Abbott | #204

Is it too late to start over at 50? Absolutely not.

In this powerful episode of the Second Act Success Career Podcast, Shannon Russell is joined by Certified Financial Planner, midlife millionaire coach, and host of Smart Women Talk Radio, Katana Abbott. Katana shares her remarkable story of resilience—from personal trauma to building a thriving financial planning business managing over $100 million.

Katana reveals why your third act can be the most purposeful and profitable season of your life. You’ll learn how to identify your financial gaps, understand your Social Security options, and create a smart retirement strategy—even if you’re starting later than expected. She also explains her “5 Money Personalities” framework, how to overcome limiting beliefs around money, and what every woman should know before walking into retirement.

🎁 Plus, Katana shares a free resource: The 5 Biggest Money Mistakes Women Make and How To Fix Them. Don’t miss it!

🎯 Takeaways from this episode:

• Why your past struggles can fuel your purpose and financial future
• The 4% rule explained (and how much you really need to retire)
• How to create guaranteed lifetime income—even without a pension
• When and how to claim Social Security the smart way
• How to design a purpose-driven third act doing what you love
• Why financial planning isn’t just for men—and how women can take control confidently

SHOW NOTES:

https://secondactsuccess.co/204

📬 Access Katana’s free ebook and learn more:
https://katanaabbott.com

5 Money Mistakes - https://smartwomensempowerment.org/sign-up/

https://www.linkedin.com/in/katanaabbott/

https://x.com/katanaabbott

https://www.facebook.com/KAWealthCoach

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Transcript

Second Act Success Career Podcast

Season 1 - Plan Your Third Act: Financial Freedom and Reinvention After 50 with Katana Abbott | #204

Episode - #204

Host: Shannon Russell

Guest: Katana Abbott

Transcription (*created by Descript and may not be perfectly accurate) 

[00:00:00] 

Shannon Russell: On this podcast, I have spoken to women in their twenties all the way up through their nineties about making a second act in life, making that pivot, trying something new. when it comes to starting a second act and making that career transition in your life, you can start at any age.

Shannon Russell: Hey there. It's another episode of the Second Act Success Career podcast. I am your host, career and business coach, Shannon [00:01:00] Russell when it comes to starting a second act and making that career transition in your life, you can start at any age.

On this podcast, I have spoken to women in their twenties all the way up through their nineties about making a second act in life, making that pivot, trying something new. And today I'm speaking with Katana Abbott. Katana is a midlife millionaire coach. She's a certified financial planner and the host of Smart Women Talk Radio.

Katana shows women 50 plus how to shatter those self-limiting beliefs and create financial freedom so that they can live with purpose during their third act, second act, third act, whatever you wanna call it. Katana has been there. Katana, has made so many transitions and transformations over her personal and professional life, and she has so much good stuff to share with us today.

Welcome to second X Success, Katana. I'm so happy to have you [00:02:00] here. 

Katana Abbott: Thank you for having me. 

Shannon Russell: Oh, of course. I feel like we can talk forever. So this is gonna be a really great episode and you have so much to share, I always like to start in the beginning. So where did your career begin? 

Katana Abbott: This is gonna sound a little crazy, but I, you know, I really believe that when we're born, we come here with a purpose and we have no idea what that is, and our job is to figure that out.

, And it's a school, and so we go on a little journey and all those things that happen lead to what you're gonna do someday. So I had a. A really difficult childhood. My dad died when I was six years old. Mm-hmm. He was in the Vietnam War. He had received a Purple Heart from the Korean War, reenlisted 'cause we were really having money issues.

And he was teaching young men how, to prepare for the infantry. He was a hunter. He went out duck hunting and freak accident. He drowned. He had waiters on and he [00:03:00] drowned. And so he never came home for with a Christmas dinner. So it was, you know, December, 1964. , It destroyed my mom's life emotionally.

She ended up coming back to, to Michigan where, where we, I've lived my, my whole life and she. Received life insurance. She bought a house, paid cash. She had benefits coming in. That's the one good thing the military does. She got veterans benefits for herself and the kids, and she also received social security, so she had income coming in.

She went and drove the school bus, had money coming in, but she wanted to have someone take care of her. she married someone from our church and he ended up being a monster. They were married for nine years. She finally divorced him. And what I wanna share with everyone is that when there's domestic violence, there is usually financial abuse too.

So when she did divorce him, she [00:04:00] had breast cancer and she was homeless. And you think that I would've learned, right? No. So we often go back to the familiar, and she did and I did. , I ended up marrying my own monster. , He apparently wanted his green card and when I married him. I didn't realize I was gonna lose because I was a warfarin.

I got free tuition to any university in the country and I also would receive veterans in social security to help me through college. 'cause my dad had died in, in the, in the war. 

Shannon Russell: Yeah. 

Katana Abbott: I married this guy. I only stayed in nine months because when I tried to to divorce him though, he ended up putting me in the hospital.

Oh. And so there I was, I had broken down car, didn't get to finish college, and I had no job. And I thought, oh my gosh, what am I gonna be able to do? Well, the first thing that happened, I mean, and you probably know this book is Think and Grow [00:05:00] Rich by Napoleon Hill. Mm. I read that book and he talks about burning desire, and I found my burning desire, which was to never be victim again.

And so I thought, what is it I can do? And I thought, oh my gosh. When I was a little kid, I. My mom used to have us go collecting money for the poor and the needy. We called it in gathering, going door to door. She'd drive the car down the road in the middle of, um, winter 'cause it was Christmas time, and so she had us going door to door collecting these holiday dollars. And people would turn off their light, you know, shut the door in my face. But a lot of people were very generous. The point of this is that we would go back and, , we would count our money and put it on the board.

I was always one of the top fundraisers. Oh, and even with all these adults, and it's 'cause I loved making a difference and I was so good at this and it, it gave me confidence. And so I sat there and I said, I know what I can do. I [00:06:00] can go door to door and I can work it in a business and, and I can sell, right?

I can be in sales. And so I did that and I became very, very successful at it. And I ended up, meeting my husband. I was selling cars at a Honda dealership and , I sold him a car. And we've been married for 40 years. I. 

Shannon Russell: Oh, amazing. 

Katana Abbott: It was clever. Yeah. You never know where this is gonna lead. And after getting married, I ended up, leaving that 'cause it was too many hours and I went into financial planning.

I had a very successful business for 20 years, managing a hundred million. I retired, I sold my practice. But the point is that we, we don't know what this journey is gonna lead us to, but we have to find the gift.

And there's always a gift. And Bancroft says, the things we overcome in life really become our strengths. So think about all those things that you [00:07:00] did when you were a kid. You know, challenges you overcame, things that were easy for you, that brought you joy. Use those and I use those in helping women find their, , third act career , find those things because that could be the key to what you need to be doing in life.

Not only, , that making a difference. Help me with finding a job, but I've raised, I've been over $5 million now for charities and I started my own nonprofit, which is what I'm doing now, is the educational program for women. 

Shannon Russell: Such a journey. Oh my gosh. And so inspiring and you having these.

Downfalls and these things that you had to go through and deal with, but yet you were able to turn them around and find the good and keep going where other people might not be able to, they might feel like they're in a stuck situation and stay there, but you didn't, you were persistent. 

Katana Abbott: Well, it's so important for us to, find a mentor, find [00:08:00] someone that's doing what you need, that you want to do, and, and to follow them, you know?

John Maxwell said it takes 10 years or 10,000 hours to become an expert, but you can, shorten that with the book. Like I did with Napoleon Hill, life Changing. Right? One of my favorites with a, with a course, with a podcast. I mean, you might get that information you need or a tip. And so we need to surround ourselves with, people that love us and support us and get rid of those naysayers, and then just really trust that the universe has your back.

, I just think that's so important to, to have that faith, to have that trust and never give up because. Shannon, I know you have worked with so many people so often. Don't we just give up right before the success happens? 

Shannon Russell: Mm-hmm. Yep. And that's heartbreaking. It really is. Yeah. And for you, I wanna go back to you working at the Honda dealership and you're selling [00:09:00] cars.

What made you decide from that job to get into financial planning? Was it that, that memory of you being successful at raising money as a child. 

Katana Abbott: Actually this is really, , interesting because there, was a gentleman who bought a car from me. He bought a red prelude from me and he, he asked me if I would have an appointment with him and he was at the company.

I would go work for someday. I realized that I used to help people, with money, with getting a car, and I decided I really wanted to help people learn how to make money.

I had learned how to make money. I was, you know, making six figures at 26 years old in today's dollars. That is, mm-hmm. So I really wanted to learn how to make money for others, and that's why I ended up in the financial, services. And it still was a long journey to get there too. But also it's really interesting, I, I want you guys to hear this [00:10:00] too.

This is how the universe works. I interviewed for both companies. I. Metro Trade and also Ameriprise. It was IDS at the time, my very first job interview, and I decided to go for the one that was more fun to me, you know, working with the business owners, going door to door and, and I didn't go to the financial planning.

But if I had gone right to the financial planning, I never would've met all these business owners that I, that I met, in the first business. See, that was part of this journey I had to go on and it was really scary doing that, talking to businessmen when you're like, you know, 20 years old.

'cause it was mostly businessmen, but. Those people, there was about five of them that I met, would become my most wealthy, successful clients when I became a financial advisor. I became one of the top advisors. I managed a hundred million dollars there and 80% of my income was coming from about 20 people, believe it or not.

And they [00:11:00] were mostly people I met. In that first, part of my career. So I think all of this is like a puzzle, don't you? I know you told me your story on the show. Yes. Yours is the exact same thing. 

Shannon Russell: It is. It's a puzzle and it's listening and being aware of those relationships and those opportunities and saying, I think I can do it, because I'm sure that took a lot of work to be managing that much money and just so much pressure.

But you did it and you did it for over 20 years. 

Katana Abbott: Yes, I did. And I brought in a young guy, from Wayne State University and as an intern, and then American Express, it was now American Express Financial Advisors. They had tuition reimbursement. I offered him to, you know, come be my assistant.

He ended up becoming a paraplanner and every time I said, would you like, um, a raise? No, no, no. I, I wanna just learn from you. He ended up getting his master's degree becoming, , licensed series [00:12:00] seven stockbroker, and doing all the behind the scenes stuff. Which I'm a front stage person and it allowed me to get out and do the stuff I wanted to do, go out and do the marketing and bring in the business, and then he ran everything.

So it was the perfect team because had he started out on his own, he. Doesn't do that. And he would've only had his mom as a client. Yeah. And I would've had all these people that wanted me to do something, but I couldn't do it on my own. And so we were the perfect team. I always tell people, figure out if you're front stage or if you're backstage, and focus on that and then delegate the rest.

 He was so good and we didn't need, when I, when I sold the practice to him, , after 20 years, he had been there 15. , He didn't need any more clients. Okay. We were full. And so it was perfect. He was able to run it and he did it beautifully. Mm. And he's still there today, so that's wonderful.

Katana Abbott: That's really important. You can be a great, all of you can [00:13:00] be great mentors for those people that, , are under you. You can really, , help lead them and help them, , get to the next level too. We, we don't realize, , how important we are in people's lives.

Shannon Russell: That's so funny that you said that. I've recently, actually, it was on St. Patrick's Day this year. I got a message from a former intern of mine, oh gosh, like maybe 15 years ago in television, and she messaged me and said, I want you to know that on March 17th, whatever year it was, I moved to Los Angeles and you got me my first job.

Because she had interned for me in like Chicago or something, but she messaged me. I didn't realize that I was her first connection and she's still in the industry today and I I, so you're right. You don't realize what your mentoring or your helping someone else can lead and really change their lives.

So I love that you brought that up. That's fantastic. 

Katana Abbott: This is what happens when you touch people's lives and you don't remember 

Shannon Russell: Well, let's take [00:14:00] it to the, to what happened when you did move out of financial advising and you got rid of that business. What was your next step? And I know you still wanted to help women especially plan for retirement. What was next for you? 

Katana Abbott: . Yeah, I started doing, , coaching, so I started something called Smart Women's Coaching and I went out and did all kinds of speaking events and I started my radio show. 15 years ago. And so here's another one. I'm on the show and my, , client calls and she's created a foundation. And right on the show she says, Hey, Katana, I'd like to make a donation to you.

Oh, to your profit. And I hadn't done anything with the nonprofit yet. And so that was the beginning of the nonprofit and I said, we'll, talk offline. Okay. Back to the show, because it was a live show back then. Oh. So again, we don't know what's gonna happen with these things, but now my [00:15:00] primary focus is, , the nonprofit.

I'm a social security claiming specialist certified. And so I do seminars but I'm gonna create a webinar so all of you, who are close to retirement can do it. I teach women and men, couples, you know.

How to determine when to take Social Security, and I'd like to share a little bit about that, just briefly. And how to determine, you know, when to take it and which amount. Really helping people in, in getting ready for retirement around 60 years old with how to plan for that.

A lot of it includes a third act. Mm-hmm. 

Shannon Russell: Yes. And I think that's such great work. Because I think we're never really taught how to plan for retirement in the right way. And when you get to that age, you know really what it means. So what you're educating people on through your nonprofit is incredible. And let's talk about that because you talk often about the third act and this is what to do in retirement. [00:16:00] Explain that a little bit more to me.

Katana Abbott: So,, I work with women on the,, inner work of money and I teach something called the Five Money Personalities, but getting rid of your disempowering beliefs. But then I also teach the outer work, of money. So what I'm gonna talk about right now is the outer work of money because the inner work is our, , mindset.

It's those thoughts going on in our head and we have to get rid of those disempowering beliefs. You know, I had talked to you about this, that we had a survey we did and, and the number one challenge women had was getting rid of self-limiting beliefs. And one of their top goals was to have enough to retire, believe it or not.

Yeah. , But the problem is if we don't get a handle on those disempowering beliefs. There's no way we're gonna be able to tackle this whole thing with investments and doing a budget. We're just gonna glaze over. And Fidelity did a study called the FIT [00:17:00] Study and they found that 50% of the women who had an investment account had never even met with the financial advisor.

Hmm. And what happens when, when we do that, we give up our power? Yeah. And I mentioned in this ebook that I'll make available to everyone. It's a couple stories in there. One of the stories is about, , a gal who, she let the husband do everything and she had twins. And when, , he died and she was pregnant, she went to get the life insurance proceeds.

It was a couple hundred thousand dollars. The ex-wife was the beneficiary because they had never sat down and she let him handle everything. We have to look at our beneficiaries, ladies. Mm-hmm. We have to get ahold of the companies, you know, they're buying each other out all the time, and just make sure those beneficiaries are correct, that they're updated because you don't want something like that, happening to you.

The [00:18:00] course I'm doing will include. Accumulating money and , getting ready for retirement. Also, all this inner work we have to do. But I'm gonna talk a little bit about this, what I call a third act, and it's for women that are probably 55, 60 and up.

Right? Okay. And, and it's a challenging time because you're supposed to save up all this money. So how do we begin? It's, it's three steps. So you can write these down if you want, but the first one is you. Have to do a budget. I know that sounds horrible. Nobody wants not live on a budget, but figure out how much money you're spending, right?

Once you figure out how much money you're spending, , I have a fillable PDF that I, that I give people and they type it in. And then over on the right column I put retirement, how much you're gonna need. For them. 'cause you may want more for travel, but now you're not having to put in 401k, so you come up with a figure.[00:19:00] 

The second thing is you find out how much guaranteed income you have. That could be rental income, that could be pension, that could be annuities, but it also will be social security. , Today I wanna focus on just social security, , as a guaranteed income and to show you how that would, , that would work.

So you find out how much you need and then all the social security pay. Now you can go to ssa.gov just go do this ladies, get an account set up. , Order the report. They don't really send it to you anymore. And then you can see how much you will get if some, if you're married as a survivor benefit, a disability benefit, but you're gonna see how much your early retirement benefit is, your full retirement, and also age 70.

So you get choices, right? You can pick 62, which most people do. You could pick maybe 65 'cause you'll get your Medicare. Then 67 is full retirement and 70 [00:20:00] is def. You get actually 8% every year. You defer guaranteed if you go to 70. But you know, a lot of people can't do that. Key is the longer you wait, the more you get.

Between 62 and 70, it's 76% more. So if your 62 benefit is 24,000, your 70 benefit delaying would be 42,000. So that's 18,000 more per year, 1500 a month, and it gets cola cost of living increase every single year. Wow. So let's try this. How's that? We're gonna just do some real quick math. Let's say you need, remember the budget, 50 grand.

And you look at your social security and you see that at age 67, that's your full benefit and you can earn as much money as you want after that. because if you try to take Social Security at 62 and work, you're limited.

, This is so important. So we're gonna use 67. [00:21:00] So you need 50, let's say social security is gonna pay you 30,000. Okay? Let's subtract five minus three is two. Mm-hmm. So you're gonna need 20,000 is your permanent income gap. 

Shannon Russell: Okay. 

Katana Abbott: So the next thing you do, how do you figure out if you have 20,000? How much investment money, how much in your 4 0 1 KK or IRA that you need?

Here's the secret, write this down. 4% rule. The 4% rule, and your broker will tell you, they'll, they'll say the most you can pull out is 4% a year. Why? Because if you pull out 4%, you can inflate it for inflation and have an 85% chance of not running outta money in 30 years. Okay, so that's the goal. Okay, so 4%, what do you do?

You take the 20,000 that you need and you're gonna divide it by 4%, divide, and it gives you a number, $500,000. Believe it or not, [00:22:00] 500,000, half a million is only going to give you 20,000 a year in retirement. Wow. When I show people that, they kind of freak out. I . So what if you don't have half a million dollars?

Right? So let's say you want have half of that. You have, um, $250,000. So now if you have $250,000, we know that's half. So you need, you can generate 10,000 a year. But the math is you take, whatever you have, 200,000, 300,000, you multiply by 4% and that's what you can take out an income. So if you have 250,000.

4% is 10,000 a year. So let's say that you have your, your permanent income gap. How much you need is 20 and you have 10,000 a year coming from your, investments, right? Where are you going to get the other 10,000? Encore career. Yes. So you could, you could wait, you could work till 70 and, you know, , [00:23:00] retire later.

But I'm just going to give you this example. Go back, figure out your unique abilities. What are those things you love doing that you could do forever? And things like Shannon and I are doing, , are not physical. So I'm 66. So I could do this for 10 years if I want to, and I probably will, right?

Mm-hmm. So, after 67, you can earn as much as you want at full retirement, and you could do that in addition to collecting social security. So if all you need is $10,000 to make that difference. That's gonna be $800 a month you earn, or $200 a week. And so if you can earn $200 a week, it's like having another quarter of a million in your brokerage account, paying you 4%.

Shannon Russell: Mm. This is, so eye opening. Yep. You explained it so concisely and easily, so I'm really excited. I can picture listeners [00:24:00] pressing pause, rewinding, going back, doing their math on a piece of paper. And this is really, really helpful and I'm gonna put links in the show notes for everything that Katana's talking about.

This way you can have access to her resources because these are really going to be essential no matter what age you are.

Katana Abbott: And I just want everyone to know there is always a plan. I have never had anyone come to me where there wasn't a plan. And another thing you can do, I had mentioned, you know, guaranteed income. We used to have pensions. They got rid of those. They made everyone go to 4 0 1 Ks where the risk is on you.

I mean, really bad. So a pension pays you a guaranteed income. You could take part of your 401k and you can actually give it to an insurance company and create your own pension. So if 250,000 only generates the $10,000 a year, putting that into an annuity would give you close to the 20,000 you need.

[00:25:00] Mm-hmm. Guaranteed lifetime income and , the kind of annuities. That I use for my clients is called a fixed indexed annuity. You still hold onto the money. It's still there in the account. It's not like you're, you can't access it. That's why I'm saying there's other options. So you might do a little bit of this, a little bit of that, a little bit.

I'm core career in our third act, you never know what's gonna happen.

So sometimes the mindset changes of what you need too. You know, you might downsize and go do something totally crazy, totally wild that, you know, you we're afraid to do. So 

Shannon Russell: My takeaway from this conversation is that. You don't know what's down the road.

You don't know what you're going to end up doing 10 years, 20 years from now, but if you plan financially now, you're gonna set yourself up to be able to do whatever is in your wildest dreams later on. Is that right? I. Absolutely. 

Katana Abbott: The key is don't be afraid. Don't be one of those women that you know won't talk [00:26:00] to their advisor or, you know, put off making, investment choices.

You can educate yourself. Come join Smart Women's Empowerment. I've got this wonderful course will be, you can learn about it when I do the masterclass on it. Go to your bank, they have people there that will talk to you, call your 401k, find out how you're invested, make sure you're diversified and you're not taking too much risk or you're taking enough risk.

Mm-hmm. You know, dollar cost averaging you, every time the market comes down, you're buying more. So don't be afraid. Fidelity has a really great program called, women and Money, smart Money or something like that. So there, there is help out there, but take action. 

Shannon Russell: It's uncomfortable.

I think that's what it is a lot of times, and even with my clients who are thinking about leaving their nine to five to start a business, it's that uncomfortable conversation to really look at your finances and see if you're able to do it. And I [00:27:00] think it's uncomfortable to think about what we've saved and what we have and what we still need to earn, but it's so, so important and I think you make it really accessible to women and easy and, and, and relatable.

And I think that is really what can help so many women, especially my listeners who are listening now 

Katana Abbott: in comparing ourselves to other, in judging ourselves or judging others. No one's gonna judge you. Don't be embarrassed if you don't wanna talk to someone. 'cause you're afraid you don't have enough.

Mm-hmm. Where you're starting is fine. And if you get the right help, there's gonna be a plan. I, I promise there always is a plan. 

Shannon Russell: Well, you have a special, , gift for my listeners. Can you tell me what that is? 

Katana Abbott: I'm giving everyone my ebook called The Five Biggest Money Mistakes, five Biggest Money Mistakes Women Make and How to Fix Them.

One of the chapters is called, , allowing a Five-Year-Old to [00:28:00] Make the Decisions. And that's because I'm talking about the Five Money Personalities, and we all have a money personality that holds us back from living the life we really love. And it really sabotages us.

So I go into a lot of detail there and I show you how to identify your money personality and to shift into a new empowering belief. And when you do download the ebook, you're gonna put in your name and email. I'll send it to you, but you'll be part of our.

Smart women community, you'll know who's coming to our shows. You'll get articles and in invitations to our events. Anyone who is worried about their retirement, they're not sure. , I keep a few meetings in my, , schedule. You can go to. katanaabbott.com. That's my website. You'll be able to, I'll ask you some questions on a form. That way when we have our 30 minute consultation, , you'll be really prepared. I'll be prepared and, and we'll do some [00:29:00] amazing things in that 30 minutes together. 

Shannon Russell: Hmm. Well, I love it because I absolutely love chatting with you.

I'm so inspired by everything that you've done in your life and everything that you've overcome and built for yourself. And I just thank you so much for being here to spread your story and your inspiration and all of your advice to us. So thank you so much. 

Thank you for joining us. I hope you found some gems of inspiration and some takeaways to help you on your path to second act, success. To view show notes from this episode, visit second act success.co. Before you go, don't forget to subscribe to the podcast so you don't miss a single episode. Reviews only take a few moments and they really do mean so much.

Thank you again for listening. I'm Shannon Russell. And this is second act success.