7 Basic Things You Should Know About Your 401k Plan

7 Basic Things You Should Know About Your 401k Plan

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Published: June 2, 2020

I recently spoke with a good friend from college who had the misfortune to lose his job. Did you have a 401(k)?” I asked him. “I think so,” he responded. “I see money coming out of my check going somewhere.” I continued to inquire. “Do you know how it’s invested? What about a company matching contribution?” My friend paused a moment before answering, “No idea. I think the company does contribute something, but I don’t know how it works. We had some guy come and talk to us and show us the investments. I picked one he said was good.” “Are you going to rollover

Free Online Class – How to Make a Retirement Income Plan

Free Online Class – How to Make a Retirement Income Plan

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Published: May 28, 2020

Our next online retirement planning class, How to Make a Retirement Income Plan, will be on Thursday, May 28, 2020. About the Class How much will you need to retire, and where will it come from?    In this class, we will show you how make a detailed retirement income plan by creating a series of timelines that chart out your future income and expense. You will see how you can put together a crystal-clear picture of your future retirement income.    We will go over:   How to make a retirement budget and the most commonly overlooked expenses What a future income timeline looks like How to calculate how

How Much Should I Withhold for Taxes in Retirement?

How Much Should I Withhold for Taxes in Retirement?

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Published: May 21, 2020

Many upcoming retirees aren’t quite sure how to estimate taxes in retirement. It’s similar to the way you calculate taxes while working. What is different is the way you withhold and pay those taxes. You need to have an estimate of the amount of taxes you are required to pay so you know what amount to have withheld from pensions, Social Security, or other types of income. In this article, we’ll look at a series of sample calculations so you can see how to calculate your tax withholding in retirement. We look at scenarios using the 2020 tax rates and rules. The

When to Start Social Security for Singles, Marrieds, and Survivors

When to Start Social Security for Singles, Marrieds, and Survivors

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Published: May 12, 2020

What would you guess your Social Security benefits are worth; a few hundred thousand dollars, maybe? Would it surprise you to know that over 25 years the average single person could receive $500,000 or more in total Social Security benefits? Many married couples will get over a million dollars. According to the Social Security office, in 2020, the average monthly Social Security retirement benefit is about $1500. That’s $18,000 a year. If you were a high-wage earner, the maximum monthly benefit for someone who had reached Full Retirement Age (or FRA) is $3000 – or $36,000 per year. And, you can get

Inheritance Tax Checklist: Know Before You Sell

Inheritance Tax Checklist: Know Before You Sell

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Published: May 12, 2020

Inheritance taxes are complicated. Many people don’t realize that inherited assets—property, stocks, investment accounts, etc.—may be subject to taxes and that there are specific tax rules for each type of asset or account. So before you start selling off assets, make sure you know the rules. We are not talking here about estate taxes. Estate taxes apply to the total value of everything you own; real estate, stocks, bonds, retirement accounts, defferred annuities, businesses, farms, and even the death benefit values of any life insurance policies owned by you. With current 2020 estate tax rules, federal estate taxes will only impact singles with

Hidden Estate Planning Mistakes That Have Horrible Consequences

Hidden Estate Planning Mistakes That Have Horrible Consequences

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Published: May 11, 2020

Imagine your spouse is ill, and you meet with an estate planning attorney to get your family affairs in order. Your attorney drafts a trust document and a will. You and your spouse sign it. You think everything is fine. Your spouse passes, and shortly after that, you find that the accounts are not set up to transfer the way you both intended. Everything is not fine. Can this happen? Yes, and it happens all the time. The situation described above happened to a client couple that I’ll call Ralph and Sue. It was a second marriage, they had no children in common,

3 Ways to Stress-Test Your Retirement Income Plan

3 Ways to Stress-Test Your Retirement Income Plan

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Published: May 4, 2020

I’ve always found engineering fascinating, particularly when it comes to building something that will last. After all, when you build a skyscraper, you can’t have it fall. The same thing is true for building a retirement income plan – it needs to last. Early in my career, I realized I wanted to find an engineering-like way to deliver financial planning advice. I wanted answers based on data, not on speculation. Yet, when I started in the financial planning business in 1995, providing answers based on data was not the norm. At that time if someone wanted to know if they should

IRA Rollovers, IRA Transfers and 15 Other IRA Basics

IRA Rollovers, IRA Transfers and 15 Other IRA Basics

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Published: March 3, 2020

Individual Retirement Accounts, called IRAs, are one of the most common and accessible ways to save for retirement. Over the years, rules about IRAs have changed. Many people think they know how an IRA works or what they can do with it, but every week I still surprise people with some of the IRA facts I share below. 1. What is an IRA? An IRA is an Individual Retirement Account. When you contribute to an IRA, you are putting money aside for your future so you will have some money when you retire. Think of an IRA as a type of savings account