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Senior Marriage and Social Security: Rules to Know

Romance aside, you may want to push the pause button before taking that walk down the aisle if you're close to retirement and counting on income from Social Security. There are some important rules you need to know to time that wedding...

Diversify Your Retirement Plan Strategy

Two people can look at a Rorschach ink blot and one will see a refined beautiful woman, and another will see an old spinster. You can also look at a retirement account and see all the good points or look at it from a different...

Why A Safe Harbor 401(k) May Be Better For A Small Business Owner

Small business owners know that finding and keeping good employees is one of the keys to increasing profits. A Safe Harbor 401(k) is a great way to reward employees and keep them happy by making generous retirement contributions on...

Do I Need to Pay Estimated Tax?

Taxpayers are required to pay most of their tax obligation during the year by having tax withheld from their paychecks or pension payments, or by making estimated tax payments. Estimated tax is the primary method used to pay tax on...

Your Retirement vs. Paying for Your Kid’s College?

You've been doing the right thing financially for many years, saving for your child's education and your own retirement. Yet now, as both goals loom in the years ahead, you may wonder what else you can do to help your child (or...

Benefits of Qualified Charitable Distributions (QCD)

Charitable contributions are no longer deductible if you take the standard deduction.  But if you’re age 70 ½ or older, and you like to give to charities, there’s a way you can give to a qualified charity and cut...

Things you can do with an IRA that you can’t with a 401k

If you have the luxury of rolling over a 401(k) to an IRA, in most cases you’ll probably be better off, and we want to summarize some of the reasons why.For starters, with 90% of the American public taking the higher standard...

Reducing IRA Withdrawals to the RMD Amount Can Save Big In Taxes

It is fairly common for people taking required minimum distributions out of retirement accounts, such as IRAs, to pull out more than the required amount, often without even being aware they are doing so, and triggering unnecessary...

72t Distributions – Taking Income before 59 1/2 without a 10% penalty

The Social Security Bridge Strategy

What To Do With All Those Old 401(k)s and IRAs?

ETFs Offer Huge Cost Savings To Consumers

Does January Predict the Stock Market’s Direction?

Can You Cut the Taxes You Pay on Your Social Security?

Working and Taking Social Security – Earnings Test

If you've claimed your Social Security retirement benefits and continue working or return to work before you reach your Full Retirement Age (FRA), you should be aware of the earnings test. Say you've claimed your Social Security at 62...

Benefits of Opening a Roth IRA for Your Child

Why would a parent want to open a Roth IRA for a child? What does this solve? Most gifts we give to our children like bicycles or vacations or even automobiles depreciate in value or have no value later. A Roth IRA, if properly...

Use Your Tax Bracket to Reallocate Investment Income into Tax Savings

Because most financial advisors do not look at an investors’ tax return, they provide little guidance in making sure the portfolio is being managed in the most tax efficient manner possible. Without becoming a tax expert, you can...

Avoiding the Headaches of Separate Trusts for Married Couples

A revocable living trust is usually the best way to pass your assets to your heirs after you’re gone. Unlike a will, assets titled in a revocable living trust avoid both the time and expense of going through the probate courts,...

Buy a Roth When You Make Too Much To Buy One

In 2021 anyone with any level of income can save up to $19,500 in a pre-tax or Roth 401(k) or similar retirement plan, and if you're 50 years of age or older, you can put in an additional $6,500, as a catch-up contribution, for a grand...

Diversification is Not Enough to Protect Investors Against Market Crashes!

For many decades, the status quo for management of an investment portfolio has been based around the notion that you diversify across many investment asset classes, and you ride out the market cycles and turbulence. This is otherwise...

Alternatives to Low Interest Paying CDs

People are wondering why they’re not earning a lot of interest right now on their interest bearing checking accounts. That’s because CD rates started dropping in 2020 when the Fed lowered the federal funds rate down to 0...

How to Recover From a Pre-Retirement Financial Crisis

Having a personal financial setback when you're closer to retirement can be doubly stressful. You’re dealing with both the financial reversal, and the realization that you have less time to earn the money back. Perhaps you had to...

Converting Taxable Gains Into Tax-Free Money, Tax-Free

An opportunity that should never be passed up by an investor is the ability to convert a taxable long-term capital gain into tax-free basis without paying taxes to do so. This is known as harvesting long term capital gains. It’s...

How to Avoid the Time and Expense of Probate

Death is inevitable, and when that time comes, your assets including your financial assets, become part of your estate until they’re legally transferred to your heirs. This transfer of assets can occur in several ways, including...

You Are Not a Benchmark - Quit Comparing Yourself to One

There are many problems with benchmarking, but one of the worst is called “comparison envy.” Comparisons in the financial arena is the main reason clients are unable to stick with a process they are comfortable with and...

3 Ways to Make Money in Company Stock

If your company offers you the opportunity to invest in its stock, it could come with some significant tax benefits and growth prospects. Most employees are familiar with the company match on their 401(k) if it’s available to...

HSAs Can Increase Your Retirement Savings

Opening a health savings account (HSA) offers a triple tax advantage. To qualify, you must be in a high-deductible health insurance plan (HDHP), you cannot be enrolled in Medicare, and you cannot be participating in another health...

Goldilocks Period for Partial Roth Conversions

Often when people retire, they will drop one or two tax brackets because they no longer have any earned income. For most people, retirement occurs in their 60s so this is when their income and tax bracket usually go down. Maybe they...

QBI Deduction May Ruin Retirement Plans for Business Owners

As part of the Tax Cuts and Jobs Acts passed in December of 2017, IRC Section 199-A was created, which allows owners of small businesses....

What to do financially when only one spouse retires?

It’s a good idea to run a retirement cash flow projection to be sure that the spouse retiring can realistically retire without putting a strain on the household finances and worse...

Traditional Medicare vs. Medicare Advantage Plans

For the vast majority of Americans, when you turn 65, you have to sign up for Medicare. You either enroll in Original Medicare which consists of Part A, B, and D or a Medicare Advantage Plan otherwise known as Medicare part C. With...

Roth IRA Conversions Are On Sale

While we hope for an end to the current pandemic, there may be a silver lining during this time of disruption. Many people will be paying less taxes in 2020 either because of the loss of income from a job lay-off or for retirees age 72...

Financial Help During the Covid-19 Crisis

The temporary closing of non-essential businesses, shelter-in-place orders, and other changes that have come with efforts to keep COVID-19 from overwhelming hospital and healthcare facilities are creating economic challenges for many...

The Powerful Inherited IRA

The only person who can take a deceased person's IRA and roll it over to their own IRA is a surviving spouse. Your kids and grandkids can’t do this, but non-spouse beneficiaries like your kids can move the deceased person’s...

Net Unrealized Appreciation

When you retire, or when you leave a company, there is a unique tax break called Net Unrealized Appreciation (NUA), available for company stock held in a pretax company retirement plan. You are allowed to move the company stock in-kind...

Are you in danger of the Health Care Surtax?

January, 2020 The health care surtax started back in 2013 and helps fund the Affordable Health Care Act, or Obamacare, which provides Americans with affordable comprehensive health care, including covering pre-existing conditions....

Proactive Social Security Strategies

We’re going to look at 3 Social Security strategies that may make you some extra money. One strategy is for those that filed early and now regret that decision. When you reach full retirement age, which for most people is age 66,...

Safe Harbor 401(k) plan

A Safe Harbor 401(k) plan is a type of 401(k) retirement plan that allows small business owners to avoid an IRS nondiscrimination test that sometimes prevents the owner from maxing out his or her 401(k), which happens when there are...

One of The Best Ways To Give To Charity

Donate stocks instead of cash to maximize your contribution, as well as tax savings. For investors who are planning on giving money to a favorite church or charity before year-end, consider one of the greatest charitable-giving tax...

Stay At Home Parents Can Still Qualify For Social Security Benefits

Just because you don’t bring home a paycheck doesn’t mean you’re not working. You can get a Social Security check just like any other worker. Here’s how: In order to qualify for a full Social Security benefit,...

Buy & Hold Myth of Missing the Best Days in the Market

There is a very popular belief that if you get out of the market to avoid a crash with a system like ours, and it rebounds and you miss even just a handful of the best days, it could cut your returns in half and cost you a lot of money...

The Fed Made a Change to its Inflation Target, and It’s a Big Deal!

The Fed made an important announcement during the June Federal Open Market Committee meeting about how it will react to inflation going forward and this could help propel the stock market higher. This is not by the Fed cutting interest...

In-Service Rollover from 401(k) Plans

Most people understand what it means to put money into a 401(k) plan. But what about taking your money out? Did you know there’s a law that allows you to potentially roll out part or all of the money in your company 401(k) plan...

Is Downsizing In Retirement Right For You?

Going through years of accumulated possessions and memories is probably not how you envisioned spending part of your retirement. It may sound like a daunting and emotionally draining task, but downsizing could be a savvy financial move...

Verify Step-up in Cost Basis for Inherited Investments

Cost basis is what you pay for an investment, and your taxable capital gain (or loss) when you sell that investment will be the difference between the cost basis and the price at which you sell your securities. When you inherit...

Should you Tap a 529 Plan before College?

529 savings plans are tax-advantaged education savings vehicles and one of the most popular ways to save for college today. Much like the way 401(k) plans changed the world of retirement savings a few decades ago, 529 savings plans...

Investing the Equity in Your Home

In our industry we have our share of financial advisors that have counseled their clients to actually take the equity out of their house and invest it. The argument is, if the after-tax rate of return on the investment portfolio is...

Different beneficiaries subject to different tax rules

Different types of IRA beneficiaries are subject to different tax rules. For example, a surviving spouse has the most flexibility. They can leave it in their deceased spouse’s name as an inherited IRA and take income without a...

Tax Projection and Tax Reduction Strategies

The coming tax-filing season will be full of twists and turns. The new tax forms should be in place, and old familiar tax breaks are gone, replaced by new tax breaks and new tax-saving opportunities. If the 2019 filing season were a...

What to Do with Your Old 401ks and IRAs

How many retirement accounts do you have? By age 50, baby boomers have held an average of 12 different jobs – half of them since age 24 – this is according to the Bureau of Labor Statistics. You may be in a situation where...

You May Regret Taking Social Security Early

Your retirement standard of living could be worse if you claim your Social Security benefits early at age 62. That’s according to a recent study by the National Bureau of Economic Research.As a review, the earliest you can take...

Help Your Children Become Investors

Naturally, parents want their children to be successful. So what’s one good thing you can teach them that will help them for the rest of their life? Consider opening them up to the world of stock investing.Young people typically...

Tax Traps to Avoid in Retirement

If you are nearing retirement, it is important to recognize, plan for, and minimize the tax bite that awaits. Most people are used to having taxes withheld from their paycheck, but when you stop working, there are no more W-4s to...

When Should You Change Your Beneficiary?

IRAs and investment accounts allow you to name beneficiaries in case you pass away. When you name beneficiaries on a beneficiary form, it will generally supersede the instructions in your trust and will. This is why it is important to...

Break Even Age for Social Security

June, 2018 Taking Social Security benefits before you reach full retirement age is almost never in your best interest. If you can afford to wait, delaying social security pays off over the long-term, especially if you wait to file at...

Is Bitcoin a Risky Investment?

Bitcoin continues to be a hot topic that generates a lot of questions. Bitcoin rose more than 1,000% in 2017, but then it dropped more than 49% in 2018. Bitcoin is a digital currency, and is sometimes referred to as cryptocurrency. It...

Which is Better - a Roth or Traditional IRA?

Individual Retirement Accounts, commonly referred to as IRAs, are tax favored accounts to help you save for your retirement. The two main types that you can choose from are a Traditional IRA and a Roth IRA. The main differences between...

Individual Retirement Account (IRA) - Just the Basics

An IRA is a personal savings account that offers you tax incentives to save for retirement. There are two types of IRAs:The Traditional IRA allows you to get a tax deduction for your contribution. When you make a tax deductible...

Tax Law Changes after Tax Reform

Now that the dust has settled since the passage of the Trump tax reform legislation, here are some of the highlights that will impact people the most: The government kept seven marginal income tax brackets in place, but reduced almost...

If You Missed Your Required Minimum Distribution (RMD)

Every year, traditional IRA owners must take what is called a required minimum distribution, or RMD, from their IRA after they turn age 70 ½. If you fail to remove this IRS mandated distribution, then you have to pay a 50%...

Year-End Tax Planning

Tax reform is in the news and it could be passed possibly before the end of this year. If it were to pass, here are some specific ideas that could help reduce your taxes. Be aware that these strategies would need to be implemented by...

Financial Benefits of Marriage

Common law marriages are not recognized in Illinois. If you've been living with someone for a long time, here are some powerful financial reasons to get officially married. If you are married, you can roll your deceased partners IRA...

Restricted Stock

Restricted Stock If you are fortunate enough to receive restricted stock from your firm, it’s important that you understand the basics of this benefit. A restricted stock plan is where shares of a company's stock is transferred...

What can a Qualified Charitable Distribution (QCD) Do for Me?

If you are age 70 ½ or older and give to charities, there’s a way you can give to a qualified charity and cut your taxes by using a Qualified Charitable Distribution (QCD). A QCD allows you to give up to $100,000 a year,...

Health Savings Account (HSA) - Help Increase Your Retirement Savings

Many of us have heard about Health Savings Accounts (HSA), but are not sure how they work or what their role is in your financial picture. Opening a health savings account can offer a triple tax advantage. But to qualify, you must be...

Common Sense Ideas for Medicare

Health care will likely be your biggest expense in retirement and fortunately there’s still Medicare to help. It’s important to watch your enrollment timing. You’re eligible for Medicare at 65 and you’re...

What is a Roth IRA?

June, 2017 What is a Roth IRA? If you make a contribution to a traditional IRA, you might get a tax deduction, depending on your income and whether you are covered by a retirement plan at work. If you can’t get a deduction, then...

Tax Loss Harvesting

Tax Loss Harvesting When investing your money, there will be times when you will have positions with a loss – it’s inevitable. The good news? There is a powerful tax strategy that you can use called loss harvesting. This...

Retirement Planning and the Invisible Enemy

What do you think is the number one concern that most people have in retirement? If you guessed running out of money, congratulations, you get a gold star! American retirees face a large decline in living standards during their final...

Proposed Tax Changes

With Donald Trump now the 45th President and the Republicans controlling the House and Senate, many tax professionals feel we are likely to see a number of tax changes in the year ahead if his campaign plans and promises hold....

Draw Down Retirement Funds Carefully

One of the toughest decisions you'll make when retiring is deciding how much to withdraw annually from your retirement accounts, like your IRA and 401k plans. If you take too much out, you could spend your later retirement years...

Home Exclusion

A question that comes up often, is what are the tax consequences when I sell my home? Some of you have large gains on your home and would like to know how the tax is handled on the gain. There is good news on this; a single taxpayer...

The Medical Expense Exception for Retirement Plans and IRAs

If you try to withdraw money from your Individual Retirement Arrangement (IRA) before you reach age 59 ½, you might have to pay an early 10% withdrawal penalty. That’s just the way the rules are written. There are however...

A Commonly Overlooked Cost Basis Error

Most people are familiar with mutual funds to a degree. Basically, a mutual fund is a portfolio of securities professionally managed by a portfolio manager or managers. Here is what most people don’t know: there is a commonly...

What Good Can a Roth IRA Do for Me?

In today’s blog we are in the area of retirement planning, and we’re going to go through some of the advantages of having a Roth IRA as part of your retirement plan and how it can benefit you. First, just a quick...

529 Plans and Estate Planning:

Most people are aware that college costs are very expensive. In fact, it has gotten too high for many parents. This has caused more and more grandparents to step up to the plate and help - by using a 529 college savings plan for their...

Avoiding Charitable IRA Beneficiary Mistakes

Can Individual Retirement Arrangements/Accounts (IRAs) be used to benefit a charity? IRAs can be a great source of funds for your favorite charity, as long as you are careful to avoid some traps in order to transfer the most money to...

Dangerous Retirement Plan Mistakes

Retirement planning is a tricky area because it involves taxes, penalties and tons of rules, so you need to be very careful. Today I am going to cover some of the most dangerous mistakes we want to help you avoid in retirement...

Younger Surviving Spouse Options for IRAs

When a person owns an individual retirement account, you get to name beneficiaries on the IRA. If you’re married, usually your spouse is the named primary beneficiary. What are your options if your spouse passes away with an IRA?...

The Living Will and Health Care Power of Attorney

Putting together a proper estate plan can be challenging. There are many different estate planning documents that we can use. Today we’ll look at two estate planning documents that can be part of your estate plan: the Living Will and...

Charitable Contribution Precautions and Tips you Should know

When it comes to giving away property for tax deductions, it’s important to take advantage of what the tax code allows. Today I’m going to go over a couple things to be aware of when donating money or assets for a tax deduction. First...

Avoid Mistakes on the IRA beneficiary Form!

For a lot of people out there, the biggest asset they have may be their IRA or retirement plan. You may have spent 30 or more years building up your IRA, but it only takes 30 seconds for a mistake to blow it up with taxes! Today I’m...

I went over my limit on the Once-Per-Year-Rollover-Rule, now what?!

In the past we’ve talked about the new Once-Per-Year-Rollover-Rule for IRAs. This rule now limits us to one indirect rollover every 12 months no matter how many IRAs you have. If you violate this rule, the IRA in violation may be...

Financial Differences between Married and Non-Married Couples

When a couple decides to live together without getting married it’s a big decision. There are some things they should be aware of. For example, they are not eligible for many of the same government, employer, and tax code benefits...

FAQ: Social Security Spouse and Divorced Spouse Benefits:

Social Security continues to be a hot topic in which we get a lot of questions. So every once in a while we like to post some of these questions on our blog for you to read and stay informed. Today’s questions are about spousal and...

The 60 Day Rollover: Caution - HANDLE WITH CARE!

Don’t you appreciate it when there’s danger ahead and someone warns you? Well we’re going to sound the alarm on indirect, or 60 day, rollovers and the new rule that went into effect at the beginning of this year. The gist of the rule...

What will my income be in retirement?!

It’s common for people to spend decades working in their respective careers or occupations. If that describes you, ideally you spent all those years working, saving, and storing up money to properly fund your retirement years. Once...

Not familiar with your retirement plan Rules? Meh, what’s the worst that can happen?

Nobody likes unpleasant surprises, and we’re going to help you avoid one today by discussing some differences between company retirement plans and IRAs. When saving for your retirement, the two primary places where people save their...

Retiring Soon? Choosing the Wrong Rollover Option Can Create a Ca-TAX-trophy!!

You may have heard news reports about the large retirement boom that is happening all over America. Trillions in retirement plans are in motion and a baby boomer retires every 8 seconds for the next several years. It’s pretty dramatic...

Counting on Your Husband's Retirement Income? Things Women Should Know!

Retirement planning at times can be tough to meet your goals. For married women who are not employed there are certain challenges they face. We’re going to look at how this can affect their retirement planning and some basic things...

The Roth IRA Has an Undo Button?

Have you ever had times in your life in which you wish you could get a do-over? We could spend a lot of time on that topic alone! Seriously, there is one thing that you CAN get a do-over on, and that is on a Roth IRA conversion! What...

Reducing tax on your Social Security, Is it really true?

Can you really do some proactive things to reduce tax on your Social Security? You really can and we’re going to look at one very powerful example. Keep in mind that as with most tax planning strategies, this will not work for...

Medicare Turns 50!

Did you know that 2015 is the 50th anniversary of Medicare? That’s right for 50 years, Medicare has been chugging along affecting the lives of Americans (good or bad) by providing health care to our aging population. What is...

Exceptions to the Early 10% Withdrawal Penalty for Retirement Plans

When it comes to retirement plans, people sometimes would like to access their money before they retire. But if taken too early, or in the wrong way, taxes as well as a 10% early withdrawal penalty can occur. You know the old saying...

Caution Flag: Loans from your 401k Plan

Many people out there have a 401k plan at work. These plans have lots of good features like a company match, and investment choices. Some, but not all plans, may allow you to take a loan against your 401k balance. In today’s blog we...

Almost age 65? Watch out for Permanent Medicare Late Enrollment Penalties!

Whether you are retired or still working, Medicare will likely be in your future when you turn age 65. We are going to look at some things you need to know about Medicare or you may face permanent, hefty penalties, and this is no joke...

Net Unrealized Appreciation: What you don’t know CAN cost you!

If you’re in a retirement plan (like a 401k) that lets you invest in your company’s stock, you should be aware of something called net unrealized appreciation or NUA, a simple tax reduction strategy with a complicated name....

Common Questions with Social Security:

Social Security is a very important topic to us and I’m sure to you as well. In today’s blog, we are going to cover some commonly asked questions people have about Social Security and these are probably questions that you...

The Essence of Estate Planning Documents

Woody Allen once said, “I’m not afraid of death, I just don’t want to be there when it happens!” Estate planning is not an easy topic since it involves planning for your death. Even though it is a sensitive...

Retirement Plans for Small Businesses

Mike's Blog If you own a small business and you aren’t using a retirement savings plan for yourself or your employees, what are you waiting for? A retirement plan can help you and your employees save for the future. One of the...

Are you in danger of the Health Care Surtax?

There’s a relatively new tax that started January 1, 2013 – the Health Care Surtax which is 3.8%.This relatively new tax hits people with higher incomes over $200,000 and it affects income from your investments. This tax...

The mysterious Inherited IRA (a.k.a Stretch IRA)

Most people have heard of Individual Retirement Accounts or IRAs, but have you heard of the Inherited IRA, sometimes called the “Stretch IRA”? We’re going to examine this mysterious IRA in today’s blog! To...

Protecting Your Money from Sequence of Return Risk

Knowledgeable investors are aware that investing in the market presents a number of risks. There’s interest rate risk, company risk, market risk, and even purchasing power risk. Risk is just part of investing. Some types of...

Filler' up!

Taxes are the largest drag on investment returns - greater than inflation, transaction costs, or management fees. Studies have shown that taxes can reduce returns by as much as 1 to 3 percentage points. Recent tax increases...

What is a Health Savings Account?

Health Savings Accounts (HSAs) allow people who have high-deductible health plans to save and pay for health-care expenses tax free. HSAs can be established by any qualified person covered by a high deductible health plan...

The IRS “Dirty Dozen” list

The IRS released their top tax scams for 2015. These Illegal scams cause serious financial penalties and interest for you the taxpayer, and potentially jail time! Always remember that you the taxpayer are legally...

How Home Sales Are Taxed

As a homeowner, you should be aware of the tax consequences of selling your home. Knowing the rules can help you minimize any negative tax consequences. When we think of gains and losses we think of investments like stocks...

An easy way to lower taxable income:

With April 15th less than a month away, it seems like taxes are on everyone’s mind right now. It’s also at this time of year when people get really motivated to reduce their taxes. Do you need some motivation? Look at line...

Minimizing Taxes of Highly Appreciated Assets

Introduction If your stocks, bonds, or other capital investments have large gains, there are some steps youcan take to minimize taxes. I'm going to touch on timing of the sale, using capital losses effectively, passing...

Traditional vs. Roth IRA’s:

Welcome to the Land of ConfusionOne of the most confusing subjects for most investors to understand is the difference between Traditional IRA’s and Roth IRA’s and which is most suitable. Both are IRAs, but each is very...

Social Security Survivor Benefits

What happens if my spouse dies? Social Security is not just for retirement income but also includes benefits to survivors. For example, you may be eligible for benefits if your wage-earner spouse died and you have young...

If you missed a Required Minimum Distribution (RMD) here’s what to do

We occasionally get calls from people as well as reporters about how to fix a missed RMD. RMD stands for required minimum distribution. This is the time of year when Required Minimum Distributions (RMDs) from IRAs are fresh...

Avoiding Financial Mistakes in a Divorce

When people divorce, their assets are usually split, including their retirement accounts. If mistakes are made during this process and taxes and penalties are involved, things get even more complicated. So let’s see how...

What Are Those Important Dates Again?

At the beginning of each new year, after we get past the holidays, the tax season starts. This inevitably leads to questions about IRAs, limits, deadlines and other important info. You may be facing these questions now, so...

What’s in the cards for Social Security trust funds?

Every year, a report is provided to Congress on the state of the program. This report, contains valuable information about the health of Social Security and how your benefits may be affected. Social Security is made up of...

Go the Whole Nine Yards

The end of the year is fast approaching and now is the perfect time to review our checklist of items you might want to consider as you get set to enter 2015. And remember, when it comes to tax matters, it’s always a good idea to...