SML Planning Minute: Recent Episodes
Security Mutual Life Advanced Markets Team
SML Planning Minute shares concise and entertaining financial ideas, for individuals, families, and business owners.
What’s Going to Happen with O.J. Simpson’s Estate?Episode 280 – The death of O.J. Simpson in April raises a lot of questions. How much money did he really have? And where will it all go?
More SML Planning Minute Podcast EpisodesTranscript of Podcast Episode 280Hello this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In today’s episode, what’s going to happen with O.J. Simpson’s estate?
The unexpected death of the controversial football legend on April 10 has raised a number of questions. Simpson had been ill with prostate cancer for quite a while, but this was not publicly known. One of the biggest remaining questions is what’s going to happen with the money he owes?
Simpson, of course, was accused and acquitted in the 1994 murders of Nicole Brown Simpson and Ron Goldman. But in 1997, he was found liable in a civil suit from Goldman’s family, and there was a judgment against him for $33.5 million.
The judgement against Simpson remains unpaid to this day.[1] He later served prison time on an unrelated matter.
The executor of the estate is Las Vegas-based attorney Macolm Lavergne, who had been one of Simpson’s personal lawyers. He created some controversy, when, a few days after Simpson’s death, he told the Las Vegas Review-Journal, “It’s my hope that the Goldmans get zero, nothing. Them specifically. And I will do everything in my capacity as the executor or personal representative to try and ensure that they get nothing.”[2]
An estate executor is generally paid a fee based on the size of the estate. As executor, Mr. Lavergne has a fiduciary duty to act in the best interests of the estate.
Lavergne’s remarks created a significant public backlash. This may have been what prompted him to soften his rhetoric a few days later. A seemingly remorseful Mr. Lavergne later added, “I’m walking back those remarks, and I will deal with Fred Goldman’s claim in accordance with Nevada law.”[3] On the other side, the Goldman family’s attorney says that the $33.5 million judgment from 1997 has actually ballooned to $114 million because of accumulated interest. The amount is believed to be far in excess of Mr. Simpson’s assets.[3]
Under Nevada law, before they can make any payment toward the Goldman family judgment, the estate will have to pay other costs such as funeral expenses, estate administrative expenses and other debts.
All of which raises an interesting dilemma. Can the executor of O.J.’s estate, as a fiduciary, do anything to prevent the Goldman family from collecting anything? Some legal experts don’t think so. If he were to refuse to pay the Goldman family, Mr. Lavergne could be in violation of his fiduciary duty and he could be personally liable.[1]
Mr. Lavergne seems to have figured this out after his controversial initial statement, thus he decided to soften his rhetoric. He tried to explain himself by implying that in his previous statement he was acting as Mr. Simpson’s personal attorney. Now he is representing the estate.[3] Either way, he still has to comply with the law.
He also seemed to suggest that there wasn’t much money in Simpson’s estate to begin with, and that there was an additional debt to the IRS.[3]
So, as executor, it seems unlikely that Mr. Lavergne can do anything of significance to freeze out the Goldman family. The question now turns to how much, if any, money will be left for them to collect.
For the rest of us, all this highlights how careful we need to be when we select an executor for our estate. It’s a tough job!
[1] Lenok, David H. “Can O.J. Simpson’s Executor Stiff-Arm the Goldman Family?” wealthmanagement.com. https://www.wealthmanagement.com/estate-planning/can-oj-simpson-s-executor-stiff-arm-goldman-family?NL=WM-27&Issue=WM-27_20240416_WM-27_842&sfvc4enews=42&cl=article_1_b&utm_rid=CPG09000007289133&elq2=0c7305f88d634288863e4756a63d0159&oly_enc_id=0906G4469178C2U&sp_eh=e38021e391e487f91ac04b2444f3959990701bef0e3ac2b2ecc63d78be83a570 (accessed April 17, 2024).
[2] Newberg, Katelyn. “O.J.’s executor says he wants Goldmans to get ‘zero, nothing’ from estate.” Las Vegas Review-Journal.https://www.reviewjournal.com/crime/courts/o-j-s-executor-says-he-wants-goldmans-to-get-zero-nothing-from-estate-3033152/ (accessed April 17, 2024).
[3] Newberg, Katelyn. “O.J.’s executor walks back ‘harsh remark,’ says he will work with Goldmans.” Las Vegas Review-Journal. https://www.reviewjournal.com/local/local-las-vegas/o-j-s-executor-walks-back-harsh-remark-says-he-will-work-with-goldmans-3034389/ (accessed April 17, 2024).
This podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.
The information presented is designed to provide general information regarding the subject matter covered. It is not to serve at legal, tax or other financial advice related to individual situations, because each person’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and X (formally Twitter). Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.
SubscribeApple PodcastsSpotifyAndroidPandoraBlubrryby EmailTuneInDeezerRSSMore Subscribe Options
Why Everyone Needs an Estate PlanEpisode 279 – Estate planning is the process of protecting your wealth and transferring a legacy to your heirs in the manner you wish. Everyone needs an estate plan regardless of wealth or lack of exposure to estate taxes.
More SML Planning Minute Podcast EpisodesTranscript of Podcast Episode 279Download The Transcript/FlyerMore SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.
The information presented is designed to provide general information regarding the subject matter covered. It is not to serve at legal, tax or other financial advice related to individual situations, because each person’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and X (formally Twitter). Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.
SearchSearch for:Company News Categories* COVID-19 (coronavirus) Information * All News & Articles * SML Planning Minute Podcast * Estate Planning * Personal Planning * Retirement Planning * Social Security Planning * Asset Protection * Business Planning * Chronic Illness * College Planning * Key Person Protection
Making the Right Choices With Your Wealth RevisitedEpisode 278 – Regardless of what you want to do with your wealth, such as leaving it to family, charity, government, or spending it all, you will need to plan for your intended outcome. Doing nothing is not going to work.
More SML Planning Minute Podcast EpisodesTranscript of Podcast Episode 278Download The Transcript/FlyerMore SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.
The information presented is designed to provide general information regarding the subject matter covered. It is not to serve at legal, tax or other financial advice related to individual situations, because each person’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and X (formally Twitter). Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.
SearchSearch for:Company News Categories* COVID-19 (coronavirus) Information * All News & Articles * SML Planning Minute Podcast * Estate Planning * Personal Planning * Retirement Planning * Social Security Planning * Asset Protection * Business Planning * Chronic Illness * College Planning * Key Person Protection
Episode 268 - The recent death of Senator Dianne Feinstein has brought attention to the dilemma faced by blended families. Life insurance can be a great tool to help smooth over some rough patches.
Episode 267 - There’s bad news everywhere you look. Political polarization in the USA, war in the Middle East, and natural disasters all over the place. But what if things are actually better than we realize? Here are some reasons to celebrate.
Episode 266 - Is early retirement a realistic goal for many people? A new study indicates that half of older Americans are considering either returning to the workforce or staying employed longer than they first planned.
Episode 265 - Previously dormant sibling rivalries tend to turn up when large sums of money are at stake. What estate planning steps can you take to help minimize the problem?
Episode 264 - It’s hard to believe, but the oldest millennials are already approaching middle age. What makes them different from a financial point of view?
Episode 263 - The program 60 Minutes recently took on the problem of overpayments by the Social Security Administration, and raised some interesting points.
Episode 262 - The “Sandwich” Generation, people taking care of both parents and children at the same time, are subject to some unique challenges.
Episode 261 - The IRS will be increasing tax enforcement action on high-income and high-net-worth individuals, and business owners. Prepare now.
Episode 260 - This being the holiday season, many of us have turned some of our attention to charitable gifts. The IRS has recently published some guidelines to help spot the difference between a real and a fake charity.
Episode 259 - The IRS further delays implementation of the rules related to the issuance of Form 1099-Ks to gig workers and independent contractors.
Episode 258 - We’ve all heard stories of Thanksgiving dinners gone terribly wrong. The food is great, the mood is good, and everyone is happy to see each other. But it all goes terribly wrong when politics enters the room.
Episode 257 - What does life insurance have to do with divorce? Life insurance and divorce intersect in several ways.
Episode 256 - Cryptocurrency can be a very volatile asset. If the cryptocurrency falls significantly in value, that loss may not be entitled to a Section 165 loss deduction on the investor’s income tax return.
Episode 255 - Massachusetts is one of twelve states with a state estate tax. Even though it just raised its state estate tax exemption amount from $1 million to $2 million, you don’t have to be ultra-wealthy to be subject to estate taxes, so plan now.
Episode 254 - Which generation—baby boomers, gen X or millennials—is better prepared for retirement? The answer may surprise you.
Episode 253 - Two recent reports paint a scary financial picture for many future retirees. But how bad is the situation really?
Episode 252 - We’ve been bombarded by mass media touting the benefits of doing a Roth conversion, but they may not be right for everyone.
Episode 251 - A recent survey found that 62% of people with student debt plan on “boycotting” their future payments. Is that a good idea?
Episode 250 - The Tax Cuts and Jobs Act of 2017 is scheduled to expire in a little over two years. Now might be a good time to start planning for a potential tax law change.
Episode 249 - The IRS recently announced a moratorium on the popular Employee Retention Credit (ERC) tax program. What happens now?
Episode 248 - Aretha Franklin’s long-running drama over her will has finally been resolved. There are lessons here for everyone.
Episode 247 - IRS delays the SECURE 2.0 requirement for catch-up contributions for highly paid employees age 50 and over to be made as Roth contributions.
Episode 246 - Do you have enough money to be considered wealthy? A recent survey by Charles Schwab and Company has the answer.
Episode 245 - The effective date of the Corporate Transparency Act, January 1, 2024, is nearly upon us. Are you affected and, if so, prepared to comply with its mandates and regulations?
Episode 245 - The effective date of the Corporate Transparency Act, January 1, 2024, is nearly upon us. Are you affected and, if so, prepared to comply with its mandates and regulations?
Episode 244 - When they’re facing a significant expense, the wealthy have a special technique they use to access cheap cash.
Episode 243 - Estate planning is the process of protecting your wealth and transferring a legacy to your heirs in the manner you wish. Even the rich and famous fail to plan, resulting in disaster. Everyone needs a will and estate plan.
Episode 242 - IRS provides additional relief to individuals who inherited traditional IRAs in 2020 or after and failed to take RMDs, and to those who mistakenly took RMDs in 2023 when they didn’t have to.
Episode 241 - Whether you’re hoping to achieve financial independence and retire early as part of the FIRE movement or later, Millennials and members of Gen Z and Gen X need to prepare for retirement now.
Episode 241 - Whether you’re hoping to achieve financial independence and retire early as part of the FIRE movement or later, Millennials and members of Gen Z and Gen X need to prepare for retirement now.
Episode 240 - Life insurance is the ideal tool to optimize an estate plan. It provides the money at the right time to pay taxes, replace wealth and to enhance and perpetuate a family legacy. It also makes various estate planning strategies more efficient.
Episode 239 - The ultra-wealthy are rooting for Charles and Kathleen Moore in their appeal to the U.S. Supreme Court to fight a tax.
Episode 238 - A surprisingly large number of parents are jeopardizing their financial futures to support their adult children. Is it worth the risk?
Episode 236 - The process of getting life insurance is a lot easier than it used to be. In this podcast, we will learn why, with special guest Angela Thieschafer.
Episode 235 - Millennials and Gen Z recognize the need to purchase life insurance, but many don’t. It all comes down to education and advice.
Episode 235 - Millennials and Gen Z recognize the need to purchase life insurance, but many don’t. It all comes down to education and advice.
Episode 234 - States with high income and estate taxes may cause the wealthy to move to another state with one or the other, but not both taxes.
Episode 233 - According to a new study, a shocking 41% of people withdraw, rather than roll over, their 401(k) balances when leaving their jobs.
Study indicates that 40 percent of Americans cash out their 401(k)s when they switch jobsEpisode 233 – According to a new study, a shocking 41% of people withdraw, rather than roll over, their 401(k) balances when leaving their jobs.
More SML Planning Minute Podcast EpisodesTranscript of Podcast Episode 233Hello this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In today’s episode, a surprising statistic. More than 40 percent of Americans take cash out of their 401(k)s when they change jobs.
The traditional 401(k) is one of America’s most basic retirement tools. Through the use of forced savings, and an employer match, the 401(k) helps millions of Americans save significant amounts of money for their retirement. But maybe not as much as we thought.
According to a new study by the University of British Columbia, rather than rolling over their 401(k) balances when they leave their jobs, a stunning 41.4 percent of U.S. workers choose to withdraw money instead. And the overwhelming majority of people who make a withdrawal—85 percent—withdraw the entire account.
There are three significant reasons why, for most people, this is likely a terrible idea.
- Taxable income. Remember that a 401(k) is a tax-deferred It is not tax-free. You do not pay income tax when you contribute to the account. The employer generally withholds the contribution from your pay before the money can be subjected to income tax. They also often match some of the contribution to the account, with a matching contribution of their own. There’s no tax going in, but when you take the money out it is considered ordinary income, and subject to income tax.One further potential complication arises when you take the money out as you leave your job. If the amount is significant, not only is it all taxable, but it could also push you into a higher tax bracket for that year.
- 10% penalty. There is also a 10 percent penalty if you withdraw the money before you reach age 59 ½. This is in addition to the federal and state income taxes you pay on this withdrawal.There are a few exceptions to this early withdrawal penalty, though. Disability is one. You must meet the IRS definition of total and permanent disability as documented by your doctor. Death is another. You also won’t owe a penalty if the IRS draws on your account to collect unpaid federal taxes. Another exception—up to $5,000—is available for the adoption or birth of a child.
And finally, there is the “substantially equal payments” exception, also referred to as the 72(t) exception. This is when you take your distributions through a series of equal payments over time. There are many potential tax traps here, but the strategy would not be an option if you withdraw the entire 401(k) balance because you leave your job. 3. Erosion of retirement savings. As we’ve discussed previously, there is an ongoing retirement savings crisis in this country. Withdrawing money from a 401(k) before retirement doesn’t help. And two recent surveys indicate that last year’s record inflation has made the situation worse. According to TIAA, an international insurance company based in New York, 25 percent of U.S. workers have cut back on their retirement savings because of inflation. Even worse, 12 percent stopped saving entirely.Also, the Senior Citizens League, an advocacy group based in Alexandria, Virginia, surveyed over a thousand people aged 55 and older. They found that 49 percent of seniors spent at least some of their emergency savings in the first quarter of 2023, up from 38 percent in 2022.
The 401(k) study generated some other interesting tidbits. For example, they conclude that a higher employer matching contribution rate actually increases, what they refer to as, the “leakage” rate, or the percentage of the account that comes out at job termination. The study estimates that a 50 percent increase in the employer match rate increases leakage probability by 6.3 percent at job termination. Or as they say, “Employers with more generous matches care about their employees’ well-being in retirement, but unintentionally nudge employees to cash out when they change jobs.
There are, of course, some good reasons why an individual would need to cash out of their 401(k), such as severe financial hardship. But as a general rule, if you need money, this should be one of your last options.
More SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.
The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.
SubscribeApple PodcastsGoogle PodcastsSpotifyAndroidPandoraStitcherBlubrryby EmailTuneInDeezerRSSMore Subscribe Options
No Step-Up in Basis for Assets in a Grantor TrustEpisode 231 – The IRS released Revenue Ruling 2023-2 stating that assets held in a grantor trust do not receive a step-up in basis upon the grantor’s death. What does that mean?
More SML Planning Minute Podcast EpisodesTranscript of Podcast Episode 231Hello this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In today’s episode, No Step-Up in Basis for Assets in a Grantor Trust.
On March 29, 2023, the IRS issued Revenue Ruling 2023-2 to settle a tax question that some estate planning attorneys and tax commentators believed to be in question. Let’s briefly discuss the issue that you and your legal and tax advisors may need to decide if it applies to you.
Grantor trusts (a/k/a “intentionally defective grantor trusts” or “defective trusts”) are very common estate planning tools used by high net-worth individuals, who may have an estate tax exposure upon death. Generally, the person making the gift, referred to as the grantor, transfers assets through gifts into an irrevocable trust designed to be a grantor trust. Retention of certain powers by the grantor that satisfy Internal Revenue Code Sections 671, et seq., would allow an irrevocable trust to be considered a grantor trust.
Grantor trust status generally means that the assets transferred are no longer considered owned by the grantor for gift and estate tax purposes. For income tax purposes, however, the grantor is still considered the owner and is subject to the income tax consequences resulting from those assets, such as the payment of income tax on taxable income generated by those assets. From an estate planning perspective, the gifting of assets into an irrevocable trust removes the value of the asset, and its potential future growth, from the value of the taxable estate at death. Payment of income taxes on income generated by the trust asset further depletes the taxable estate.
One of the basic axioms of estate planning is that assets acquired or passed from a decedent, as defined in Internal Revenue Code Section 1014, receives a basis adjustment to the fair market value as of the date of death (i.e., “step-up in basis”). What does that mean? Let’s review a simple example. A parent purchased an asset years ago for $10. That is the parent’s basis. It is now worth $100, and the asset is gifted to a child. The child’s basis remains at $10. That’s known as “carryover” basis. The child turns around and sells the asset for $100. The child is now subject to $90 of capital gains. Contrast that to the situation where the asset is passed to the child through a bequest, because of the parent’s death. The child’s basis in that asset has been “stepped up” to its fair market value on the date of death, which is $100. If the child immediately sells the asset for $100, there would be no capital gains.
Some prominent estate planning attorneys and tax advisors have argued for years that assets placed into a grantor trust should still receive a basis step-up upon the death of the grantor. They reason that nothing in Internal Revenue Code Section 1014, the applicable regulations, or legislative history, expressly precludes transfers made under a lifetime trust from qualifying as a bequest or devise at death. Since the assets in a grantor trust are still deemed owned by the grantor during the grantor’s lifetime, for income tax purposes, an argument can be made that the assets passed as a result of the death of the grantor, since the trust no longer qualifies as a grantor trust at the moment of death. Therefore, the assets in the trust should receive a “step-up” in basis upon the death of the grantor.
Revenue Ruling 2023-2 declared the IRS’s official position that assets held in a grantor trust do NOT receive a basis “step-up” upon the death of the grantor. Since that Revenue Ruling was issued, commentators have continued the debate, noting that a Revenue Ruling while an official interpretation by the IRS on how the law is applied to a specific set of facts, a Revenue Ruling does not have the same force and effect as a statute, regulation, or court case. But it must be pointed out that if a taxpayer continues to argue the counterpoint, the IRS may also seek to apply penalties and interest.
So, while the IRS has issued a Revenue Ruling, the debate is far from over. Aggressive taxpayers may decide to challenge the IRS’s position.
More SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.
The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.
SubscribeApple PodcastsGoogle PodcastsSpotifyAndroidPandoraStitcherBlubrryby EmailTuneInDeezerRSSMore Subscribe Options
Charities Need Our Help and We Can Help YouEpisode 229 –Individuals and charities have been adversely affected by post-pandemic circumstances. We can help charitably inclined individuals meet philanthropic goals without sacrificing personal financial security.
Transcript of Podcast Episode 229Download The Transcript/FlyerMore SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.
The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.
SearchSearch for:Company News Categories* COVID-19 (coronavirus) Information * All News & Articles * SML Planning Minute Podcast * Estate Planning * Personal Planning * Retirement Planning * Social Security Planning * Asset Protection * Business Planning * Chronic Illness * College Planning * Key Person Protection
Social Security Trustees Report 2023: Here We Go AgainEpisode 228 – The new Social Security Trustees report has both good news and bad news. The question is: where do we go from here?Transcript of Podcast Episode 228Download The Transcript/FlyerMore SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.
The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.
SearchSearch for:Company News Categories* COVID-19 (coronavirus) Information * All News & Articles * SML Planning Minute Podcast * Estate Planning * Personal Planning * Retirement Planning * Social Security Planning * Asset Protection * Business Planning * Chronic Illness * College Planning * Key Person Protection
Social Security Trustees Report 2023: Here We Go AgainEpisode 228 – The new Social Security Trustees report has both good news and bad news. The question is: where do we go from here?Transcript of Podcast Episode 228Download The Transcript/FlyerMore SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.
SearchSearch for:Company News Categories* COVID-19 (coronavirus) Information * All News & Articles * SML Planning Minute Podcast * Estate Planning * Personal Planning * Retirement Planning * Social Security Planning * Asset Protection * Business Planning * Chronic Illness * College Planning * Key Person Protection
The 529 Plan Rollover to a Roth IRA – Is it Worth it?Episode 227 – The initial promise and excitement of a provision created by SECURE 2.0, to allow 529 Plan account balances to be rolled over to a Roth IRA, has ended in disappointment, but it may still work for you.
More SML Planning Minute Podcast EpisodesTranscript of Podcast Episode 227Hello this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In today’s episode, The 529 Plan Rollover to a Roth IRA – Is it Worth it?
On December 29, 2022, President Joe Biden signed into law the Consolidated Appropriations Act, 2023. For Americans trying to save enough for retirement, an important section of that law was the portion often dubbed “the SECURE Act 2.0”, or more appropriately, “the Setting Every Community Up for Retirement Enhancement 2.0 Act of 2022” (“SECURE 2.0”). SECURE 2.0 built upon the original SECURE Act, or Setting Every Community Up for Retirement Enhancement Act of 2019, that was signed into law by President Donald Trump on December 20, 2019.
One particular provision of SECURE 2.0 initially garnered a great deal of attention. That provision allowed for tax-free rollovers of unused 529 Plan balances to a Roth IRA. 529 Plans are very attractive college funding vehicles because it allows for tax-free growth of the investments in the plan, as well as the tax-free and penalty-free withdrawal of plan balances, if used for qualified higher education expenses such as tuition, fees, books, supplies and computers. However, if any funds remained in the account because the child did not need all of the money in the plan to fund higher education, or the child failed to even go to college, the choices were either to name a new beneficiary, such as another family member, or withdraw the funds. Withdrawal of the funds, however, would be subject to income tax on the investment growth and a 10% penalty.
SECURE 2.0 provided some initial excitement with the rollover provision. After detailed analysis, however, that provision has disappointed many because of all the restrictions placed on its use. So, if you were thinking this might be a great provision for you to take advantage of, think again. We’ll briefly summarize some of those restrictions.
- This provision is not effective until 2024, so those who have 529 Plan balances will need to wait another year.
- The 529 Plan must have been in existence for at least 15 years, so newer plans are not eligible.
- The rollover can only go to the 529 Plan beneficiary’s Roth IRA, NOT the account owner’s Roth IRA. This is one of the most disappointing provisions.
- Contributions to the 529 Plan made during the last 5 years prior to the rollover are not eligible for the rollover.
- The rollover maximum is limited to $35,000, lifetime, per beneficiary.
- Even though the maximum limit is $35,000, it can’t all be rolled over in one year. Rather, the law limits the amount that can be rolled over to whatever the limit is for IRA contributions in that year. For example, the current IRA contribution limit for 2023 is $6,500 or $7,500 for those over age 50. Using those numbers, that means it would take at least 5 to 6 years to complete the maximum rollover.
- If the rollover is made, that may limit the beneficiary’s ability to make further contributions to a Roth IRA that year.
- In order to contribute to a Roth IRA, the beneficiary must have earnings, so unemployed children cannot do the rollover. Also, the ability to contribute to a Roth IRA is limited by the amount of income earned that year, so highly successful children who were beneficiaries of the 529 Plan may be barred from the rollover if they earn too much.
While this provision created a lot of excitement when it was enacted, that euphoria has died down because of the restrictions. Also, critics believe that this is just another method for the wealthy to move money to the next generation on a tax-favorable basis. Congress, however, may yet listen to the complaints and comments and fine-tune the program to make it more attractive in the future, so stay tuned.
More SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.
The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.
SubscribeApple PodcastsGoogle PodcastsSpotifyAndroidPandoraStitcherBlubrryby EmailTuneInDeezerRSSMore Subscribe Options
The 529 Plan Rollover to a Roth IRA – Is it Worth it?Episode 227 – The initial promise and excitement of a provision created by SECURE 2.0, to allow 529 Plan account balances to be rolled over to a Roth IRA, has ended in disappointment, but it may still work for you.
More SML Planning Minute Podcast EpisodesTranscript of Podcast Episode 227Hello this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In today’s episode, The 529 Plan Rollover to a Roth IRA – Is it Worth it?
On December 29, 2022, President Joe Biden signed into law the Consolidated Appropriations Act, 2023. For Americans trying to save enough for retirement, an important section of that law was the portion often dubbed “the SECURE Act 2.0”, or more appropriately, “the Setting Every Community Up for Retirement Enhancement 2.0 Act of 2022” (“SECURE 2.0”). SECURE 2.0 built upon the original SECURE Act, or Setting Every Community Up for Retirement Enhancement Act of 2019, that was signed into law by President Donald Trump on December 20, 2019.
One particular provision of SECURE 2.0 initially garnered a great deal of attention. That provision allowed for tax-free rollovers of unused 529 Plan balances to a Roth IRA. 529 Plans are very attractive college funding vehicles because it allows for tax-free growth of the investments in the plan, as well as the tax-free and penalty-free withdrawal of plan balances, if used for qualified higher education expenses such as tuition, fees, books, supplies and computers. However, if any funds remained in the account because the child did not need all of the money in the plan to fund higher education, or the child failed to even go to college, the choices were either to name a new beneficiary, such as another family member, or withdraw the funds. Withdrawal of the funds, however, would be subject to income tax on the investment growth and a 10% penalty.
SECURE 2.0 provided some initial excitement with the rollover provision. After detailed analysis, however, that provision has disappointed many because of all the restrictions placed on its use. So, if you were thinking this might be a great provision for you to take advantage of, think again. We’ll briefly summarize some of those restrictions.
- This provision is not effective until 2024, so those who have 529 Plan balances will need to wait another year.
- The 529 Plan must have been in existence for at least 15 years, so newer plans are not eligible.
- The rollover can only go to the 529 Plan beneficiary’s Roth IRA, NOT the account owner’s Roth IRA. This is one of the most disappointing provisions.
- Contributions to the 529 Plan made during the prior to the rollover are not eligible for the rollover.
- The rollover maximum is limited to $35,000, lifetime, per beneficiary.
- Even though the maximum limit is $35,000, it can’t all be rolled over in one year. Rather, the law limits the amount that can be rolled over to whatever the limit is for IRA contributions in that year. . Using those numbers, that means it would take at least 5 to 6 years to complete the maximum rollover.
- If the rollover is made, that may limit the beneficiary’s ability to make further contributions to a Roth IRA that year.
- In order to contribute to a Roth IRA, the beneficiary must have earnings, so unemployed children cannot do the rollover.
While this provision created a lot of excitement when it was enacted, that euphoria has died down because of the restrictions. Also, critics believe that this is just another method for the wealthy to move money to the next generation on a tax-favorable basis. Congress, however, may yet listen to the complaints and comments and fine-tune the program to make it more attractive in the future, so stay tuned.
More SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.
SubscribeApple PodcastsGoogle PodcastsSpotifyAndroidPandoraStitcherBlubrryby EmailTuneInDeezerRSSMore Subscribe Options
Six Big Mistakes People Make with Their WillsEpisode 226 – Just having a will is not enough. You need to get the details right. Here are 6 big mistakes we see people making when they structure their wills.
More SML Planning Minute Podcast EpisodesTranscript of Podcast Episode 226Hello this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In today’s episode, six big mistakes people make with their wills. Here they are in order.
1. Doing Nothing
Pablo Picasso has been quoted as saying, “Only put off until tomorrow what you are willing to die having left undone.” The biggest mistake you can make with your will is not having one at all, and procrastination is enemy #1.
If you have any assets at all, they are worth protecting. And the last thing you want to do is die “intestate,” that is, without a will. Dying intestate means that the disposition of your assets will not be decided by you or your family, but by state law. Is that the best arrangement?
2. Not Reviewing and Updating
Let’s get real: having a will is the most important step. But it’s not enough. Tax laws and asset values change. As time passes, you might change your mind about who gets what in your family, or you may have a falling out with your favorite charity or even a family member. Even your choice of executor may need to be updated.
One common benchmark is to make sure your will is updated at least once every 5 to 10 years, or whenever there is a major tax law change. Another time to re-evaluate your will occurs whenever a change occurs in your family’s make-up, for example, a marriage, a divorce, a death or even a birth.
3. Picking the Wrong Beneficiary
This is one hazard that can easily undo most, if not all, of your planning. IRAs, 401(k)s and life insurance policies are generally administered outside your will. The obvious potential problem here—and one we’ve discussed before—is divorce. It’s doubtful you would still want your ex to be the beneficiary of your IRA or life insurance policy, but simply changing your will won’t help with that. You need to change the beneficiary of these non-probate assets..
And what happens if one of your beneficiaries dies before you do? Often with a life insurance policy, there is a contingent beneficiary. If the primary beneficiary dies before the insured, then the death benefit would be paid to the contingent beneficiary.
If there are no contingent beneficiaries, then the death benefit will usually be paid directly into your estate. This means that the amount of the death benefit will go through probate, where it is subject to public scrutiny and vulnerable to the claims of creditors.
4. Lack of Flexibility
People make estate planning decisions based on their current financial situation, but that is likely to change before you die. Let’s say you have a $3 million dollar estate. You want to leave $1 million to your favorite charity and the rest to your two kids. But what happens if, over time, the total value of your assets drops to $2 million. Are you comfortable with your kids absorbing all of that loss in value?
This is why you need flexibility. Your will needs to be structured to avoid unintended consequences.
5. Leaving Cash in the Wrong Hands
For obvious reasons, there are issues with a minor child getting a significant amount of cash. In many states, a court can appoint a conservator for the benefit of a minor who inherits a sum of money. The conservator manages and controls the assets until the minor reaches adulthood.
But it’s not just young children you need to worry about. There are also adults who are simply irresponsible, as well as others who face difficulties that make it unwise to provide them with a large sum of cash.
Rather than leaving a mess behind them, many people prefer to set up a trust in their will that will take effect at their death.
And finally…
6. Not Communicating Properly
Perhaps not surprisingly, money can bring out an ugly side in some people. There’s a good chance that whatever you decide, someone is going to feel shortchanged, whether the feeling is justified or not.
How do you deal with something like this? One way is to recognize that information is critical. Conflicts can flare up when one or more parties are surprised by what the will says. So you need to talk things over, and it’s best to do so before you sign the will. This could give you a chance to head off any ill feelings before it’s too late.
Life Insurance Can Help
A properly structured life insurance policy can go a long way to help your heirs feel more loved and respected. It also may help provide the funds needed to pay the costs associated with probate and to help meet your financial objectives.
Unsure of where to begin? Your Security Mutual life insurance advisor can help. Contact your Security Mutual life insurance advisor today to review your goals and objectives for yourself, your family, or for your business. Your Security Mutual life insurance advisor will work closely with your tax and legal advisors to create a plan that best fits your goals and objectives.
More SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.
The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.
SubscribeApple PodcastsGoogle PodcastsSpotifyAndroidPandoraStitcherBlubrryby EmailTuneInDeezerRSSMore Subscribe Options
Six Big Mistakes People Make with Their WillsEpisode 226 – Just having a will is not enough. You need to get the details right. Here are 6 big mistakes we see people making when they structure their wills.
More SML Planning Minute Podcast EpisodesTranscript of Podcast Episode 226Hello this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In today’s episode, six big mistakes people make with their wills. Here they are in order.
1. Doing Nothing
Pablo Picasso has been quoted as saying, “Only put off until tomorrow what you are willing to die having left undone.” The biggest mistake you can make with your will is not having one at all, and procrastination is enemy #1.
If you have any assets at all, they are worth protecting. And the last thing you want to do is die “intestate,” that is, without a will. Dying intestate means that the disposition of your assets will not be decided by you or your family, but by state law. Is that the best arrangement?
2. Not Reviewing and Updating
Let’s get real: having a will is the most important step. But it’s not enough. Tax laws and asset values change. As time passes, you might change your mind about who gets what in your family, or you may have a falling out with your favorite charity or even a family member. Even your choice of executor may need to be updated.
One common benchmark is to make sure your will is updated at least once every 5 to 10 years, or whenever there is a major tax law change. Another time to re-evaluate your will occurs whenever a change occurs in your family’s make-up, for example, a marriage, a divorce, a death or even a birth.
3. Picking the Wrong Beneficiary
This is one hazard that can easily undo most, if not all, of your planning. IRAs, 401(k)s and life insurance policies are generally administered outside your will. The obvious potential problem here—and one we’ve discussed before—is divorce. It’s doubtful you would still want your ex to be the beneficiary of your IRA or life insurance policy, but simply changing your will won’t help with that. You need to change the beneficiary of these non-probate assets..
And what happens if one of your beneficiaries dies before you do? Often with a life insurance policy, there is a contingent beneficiary. If the primary beneficiary dies before the insured, then the death benefit would be paid to the contingent beneficiary.
If there are no contingent beneficiaries, then the death benefit will usually be paid directly into your estate. This means that the amount of the death benefit will go through probate, where it is subject to public scrutiny and vulnerable to the claims of creditors.
4. Lack of Flexibility
People make estate planning decisions based on their current financial situation, but that is likely to change before you die. Let’s say you have a $3 million dollar estate. You want to leave $1 million to your favorite charity and the rest to your two kids. But what happens if, over time, the total value of your assets drops to $2 million. Are you comfortable with your kids absorbing all of that loss in value?
This is why you need flexibility. Your will needs to be structured to avoid unintended consequences.
5. Leaving Cash in the Wrong Hands
For obvious reasons, there are issues with a minor child getting a significant amount of cash. In many states, when a child inherits a large sum, a court supervised conservatorship will be established for the benefit of the minor. The conservator will manage and control the assets until the minor reaches adulthood.
But it’s not just young children you need to worry about. There are also adults who are simply irresponsible, and others, through no fault of their own, face difficulties that make it unwise to provide them with a large sum of cash.
Rather than leaving a mess behind them, many people prefer to set up a trust in their will that will take effect at their death.
And finally…
6. Not Communicating Properly
Perhaps not surprisingly, money can bring out an ugly side in some people. There’s a good chance that whatever you decide, someone is going to feel shortchanged, whether the feeling is justified or not.
How do you deal with something like this? One way is to recognize that information is critical. Conflicts can flare up when one or more parties are surprised by what the will says. So you need to talk things over, and it’s best to do so before you sign the will. This could give you a chance to head off any ill feelings before it’s too late.
Life Insurance Can Help
A properly structured life insurance policy can go a long way to help your heirs feel more loved and respected. It also may help provide the funds needed to pay the costs associated with probate and to help meet your financial objectives.
Unsure of where to begin? Your Security Mutual life insurance advisor can help. Contact your Security Mutual life insurance advisor today to review your goals and objectives for yourself, your family, or for your business. Your Security Mutual life insurance advisor will work closely with your tax and legal advisors to create a plan that best fits your goals and objectives.
More SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.
The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.
SubscribeApple PodcastsGoogle PodcastsSpotifyAndroidPandoraStitcherBlubrryby EmailTuneInDeezerRSSMore Subscribe Options
The Importance of FDIC InsuranceEpisode 225 – Recent financial turmoil involving several large banks provides an important lesson and opportunity to revisit the general FDIC-insurance rules and limitations.
More SML Planning Minute Podcast EpisodesTranscript of Podcast Episode 225Hello this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In today’s episode, The Importance of FDIC Insurance.
The fragility of the banking industry and the near collapse, bankruptcy and/or receivership of several large banks have dominated recent news headlines. The affected banks include Silicon Valley Bank, the nation’s 16th largest bank; First Republic Bank, the nation’s 14th largest bank, both as of December 31, 2022; and Signature Bank. This has caused the federal government and several of the largest banks to band together to provide assistance.
As many of you may know, typically, the Federal Deposit Insurance Corporation or FDIC provides assurance that depositors’ funds are insured from bank failures up to $250,000. However, many depositors’ accounts in these banks far exceeded that limit causing personal and market turmoil. As a result, the FDIC has had to invoke its so-called “systemic risk exception” to prevent uninsured depositors at these institutions from taking losses. Although the FDIC was created by the Banking Act of 1933 during a severe banking crisis, to restore the public’s confidence in banks, the “systemic risk exception” wasn’t created until the Federal Deposit Insurance Corporation Improvement Act of 1991. The exception was first used in 2008 when Wachovia, Citigroup, and Bank of America, three of the four largest banks at that time, were in crisis.
Given the reality that banks can and do fail, now would be a good time to review the general rules that apply to FDIC insurance. Note that while most banks are, not all banks are FDIC-insured banks. What does that mean? Only FDIC-insured banks provide depositors with FDIC insurance that will protect your money in the event of a bank failure. The FDIC insurance extends to checking accounts, savings accounts, money market deposit accounts, and certificates of deposit. The standard insurance amount is $250,000 per depositor, per insured bank, for account ownership category. Accounts such as stock brokerage accounts, bonds, mutual funds, life insurance policies, annuities, safe deposit boxes, and others, are NOT FDIC-insured, although there may be other state or federal regulatory insurance.
For example, if a depositor has a checking account, savings account and money market deposit account in the same bank, the FDIC insurance aggregates those accounts to meet the $250,000 maximum coverage because those accounts fall into one account ownership category (i.e., sole ownership). If the depositor has more than $250,000 to save, then the depositor should be encouraged to split that amount to accounts in multiple FDIC-insured banks, up to the $250,000 maximum in each bank, to ensure the widest insurance coverage.
However, if the depositor is also a joint account owner of an account in the same bank as their individual accounts, then there is a separate $250,000 maximum that applies for each joint account owner for those jointly owned accounts. That satisfies the “account ownership category” requirement. For example, if two spouses are joint account owners, then each of them would have up to $250,000 of FDIC insurance for the joint accounts in that bank. That means $500,000 of joint account savings would be covered. That would be in addition to any accounts in that bank under individual names. The same would be true for accounts held in the name of a revocable living trust, irrevocable trust or a business entity. These accounts may all enjoy separate insurance coverage up to $250,000 in that same bank.
The general rules for determining if accounts are insured and to what extent, can often rest on the account ownership category. Calculating the FDIC-insurance coverage can, at times, get complicated but, given the surprise of the recent bank issues, is a worthwhile exercise if you have more than $250,000 to save in a bank account.
More SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.
The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.
SubscribeApple PodcastsGoogle PodcastsSpotifyAndroidPandoraStitcherBlubrryby EmailTuneInDeezerRSSMore Subscribe Options
The Sad Case of Lisa Marie PresleyEpisode 224 – Lisa Marie Presley’s death in January of this year came as a shock to many. But it’s just the beginning of the story.
More SML Planning Minute Podcast EpisodesTranscript of Podcast Episode 224Hello this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In today’s episode, the sad case of Lisa Marie Presley.
Earlier this year, the unexpected death of Lisa Marie Presley, Elvis’s only child, came as a shock to many people. She was only 54.
She has three surviving children. Her only son, Benjamin, died by suicide in 2020. The three daughters will inherit Graceland, Elvis’s famed estate in Memphis, but it’s unclear what else is coming. Lisa Marie sold off 85 percent of her father’s possessions, likeness and publishing rights back in 2004.
People were equally shocked to learn that Presley, who had inherited $100 million when she turned 25 in 1993, had somehow managed to lose or squander most of what she had gotten. As always, with sad details of a shattered estate, there are lessons that we can all learn.
Let’s start with Lisa Marie’s spending habits. It’s a textbook example of what’s known as the “wealth effect.” The wealth effect is a behavioral finance theory that people spend more money as the value of their assets rise. And that seems to be what happened to Lisa Marie starting with the 1993 inheritance. As the money dissipated, she was unable to cut back when she really needed to.
According to published reports, a few years ago Presley was spending $92,000 per month on her living expenses, with less than $1,000,000 of liquid assets. Not to mention a significant reported debt to the IRS and a bitter custody battle with her fourth ex-husband. Her ex also alleged that Presley was behind on her $4,600 a month in child support payments.
And there were other planning mistakes. She appointed her mother and then business manager as trustees rather than hiring a professional fiduciary. That was until 2016, when she fired her mom and her manager, appointed her daughters (even though two of them were minors), and ended up suing the manager for mismanagement.
But since her death, problems have surfaced with the 2016 document. For one thing, her mother Priscilla’s attorneys have claimed that the amendment was neither witnessed nor notarized, and that Priscilla’s name is misspelled. They also question the authenticity of Lisa Marie’s signature.
It also appears that she had a $10 million life insurance policy that lapsed, presumably for non-payment.
And there is the question of what happened to the proceeds of the trust that terminated in 1993. According to legal experts, the money would likely have been better protected had it been set up for an older age distribution or even for Lisa Marie’s lifetime. Had Elvis done this, more of the money he earned would have stayed in the family.
All of this will likely lead to years of expensive litigation and hurt feelings. And much of it could have been avoided with more careful planning and a little bit of spending discipline.
More SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.
The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.
SubscribeApple PodcastsGoogle PodcastsSpotifyAndroidPandoraStitcherBlubrryby EmailTuneInDeezerRSSMore Subscribe Options
IRS Provides Guidance on Required Minimum Distributions for 2023Episode 223 – Confusion for IRA owners turning age 72 in 2023? The IRS provides clarification and reminds IRA owners that individuals turning age 72 in 2023 are not required to take required minimum distributions.
More SML Planning Minute Podcast EpisodesTranscript of Podcast Episode 223Hello this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In today’s episode, IRS provides guidance on required minimum distributions for 2023.
By now, many of you have probably heard of the new law commonly known as SECURE 2.0. This law significantly impacts retirement planning for individuals. SECURE 2.0 was part of the Consolidated Appropriations Act 2023, which was signed into law on December 29, 2022. It builds upon the original SECURE Act or Setting Every Community Up for Retirement Enhancement Act of 2019 that was signed into law at the end of 2019. Notably, the original SECURE Act raised the age in which individuals generally needed to take required minimum distributions (“RMDs”) from IRAs and qualified retirement plans from age 70 1/2 to 72. SECURE 2.0 goes further and raises the age to 73 commencing in 2023, and eventually to age 75 commencing in 2033.
Given that SECURE 2.0 was enacted at the end of 2022 with effective dates a few days later, there was a great deal of confusion because individuals turning age 72 in 2023 were preparing to begin RMDs required by the original SECURE Act. SECURE 2.0 changed that so only those turning 73 in 2023 need to commence RMDs.
Financial institutions are generally required to file Form 5498 and indicate in Box 11 that an RMD is required for the year. The financial institution must also furnish a statement to the IRA owner that informs the IRA owner of the date by which the RMD must be distributed. But given the rapidness of the effective date of SECURE 2.0, the recordkeeping systems of many financial institutions could not be updated quickly enough. Individuals who turned 72 in 2023, may have already received a letter from their financial institution indicating the need for an RMD this year. On March 7, 2023, the IRS issued Notice 2023-23 which, in essence, indicated that the IRS will ignore that letter provided that the IRA owner is notified by the financial institution no later than April 28, 2023, that no RMD is actually required for 2023.
So, if you turn age 72 in 2023, you are not required to commence RMDs in 2023. However, if you turn age 73 in 2023, you are required to commence RMDs in 2023. Note, however, that if you attained age 72 prior to January 1, 2023, you are still required to commence taking RMDs.
Yes, it is all pretty confusing! The IRS is encouraging all financial institutions to remind IRA owners who attained age 72 in 2022, and have not yet taken their 2022 RMDs, that they are still required to take those distributions by April 1, 2023.
More SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.
The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.
SubscribeApple PodcastsGoogle PodcastsSpotifyAndroidPandoraStitcherBlubrryby EmailTuneInDeezerRSSMore Subscribe Options
IRS Provides Guidance on Required Minimum Distributions for 2023Episode 223 – Confusion for IRA owners turning age 72 in 2023? The IRS provides clarification and reminds IRA owners that individuals turning age 72 in 2023 are not required to take required minimum distributions.
More SML Planning Minute Podcast EpisodesTranscript of Podcast Episode 223Hello this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In today’s episode, IRS provides guidance on required minimum distributions for 2023.
By now, many of you have probably heard of the new law commonly known as SECURE 2.0. This law significantly impacts retirement planning for individuals. SECURE 2.0 was part of the Consolidated Appropriations Act, 2023 which was signed into law on December 29, 2022. It builds upon the original SECURE Act or Setting Every Community Up for Retirement Enhancement Act of 2019 that was signed into law at the end of 2019. Notably, the original SECURE Act raised the age in which individuals generally needed to take required minimum distributions (“RMDs”) from IRAs and qualified retirement plans from age 70 1/2 to 72. SECURE 2.0 goes further and raises the age to 73 commencing in 2023, and eventually to age 75 commencing in 2033.
Given that SECURE 2.0 was enacted at the end of 2022 with effective dates a few days later, there was a great deal of confusion because individuals turning age 72 in 2023 were preparing to begin RMDs required by the original SECURE Act. SECURE 2.0 changed that so only those turning 73 in 2023 need to commence RMDs.
Financial institutions are generally required to file Form 5498 and indicate in Box 11 that an RMD is required for the year. The financial institution must also furnish a statement to the IRA owner that informs the IRA owner of the date by which the RMD must be distributed. But given the rapidness of the effective date of SECURE 2.0, the recordkeeping systems of many financial institutions could not be updated quickly enough. Individuals who turned 72 in 2023, may have already received a letter from their financial institution indicating the need for an RMD this year. On March 7, 2023, the IRS issued Notice 2023-23 which, in essence, indicated that the IRS will ignore that letter provided that the IRA owner is notified by the financial institution no later than April 28, 2023, that no RMD is actually required for 2023.
So, if you turn age 72 in 2023, you are not required to commence RMDs in 2023. However, if you turn age 73 in 2023, you are required to commence RMDs in 2023. Note, however, that if you attained age 72 prior to January 1, 2023, you are still required to commence taking RMDs.
Yes, it is all pretty confusing! The IRS is encouraging all financial institutions to remind IRA owners who attained age 72 in 2022, and have not yet taken their 2022 RMDs, that they are still required to take those distributions by April 1, 2023.
More SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.
The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.
SubscribeApple PodcastsGoogle PodcastsSpotifyAndroidPandoraStitcherBlubrryby EmailTuneInDeezerRSSMore Subscribe Options
Why Giving Cash to Your Children May Not be a Good IdeaEpisode 222 – Most parents are naturally inclined to provide financial assistance to their adult children. But be careful: it may do more harm than good.
More SML Planning Minute Podcast EpisodesTranscript of Podcast Episode 222Hello this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In today’s episode, we’re going to discuss why giving cash to your children may not always be a good idea.
It seems that for anyone who accumulates wealth, at some point in their lives the natural inclination is to want to share it with their loved ones. The only question is how. But be careful. There can be significant perils to giving away cash, and doing so can often cause more harm than good.
Experts agree that there is a significant difference between an urgent short-term need, such as medical bills or a divorce, and simple lifestyle maintenance. Most parents, if they can afford it, are willing to help when a truly urgent situation arises. But a short-term need can easily become a long-term dependency. As author Susan Covell Alpert explained in a 2019 New York Times article, “You’re rescuing them temporarily; you’re not indulging them forever and putting them on your payroll.”
And you need to do a certain amount of homework. No matter how much you trust your kids, it’s usually a good idea to verify that the need is real. Sadly, there are some adult children out there who are all too willing to take advantage of their loving parents.
It’s a dilemma many parents face: how much, if anything, do you give to an able-bodied adult child who asks for help? Since the pandemic began a few years ago, there has been an increased tendency for some millennials to stay home longer, get married at a later age, and rely more on their parents for the basics. You need to be careful not to create a dependent adult child. Some experts have suggested that it is best to charge your adult children rent, and to not pay any allowance without some strings attached.
And exactly how do you provide that help? It could be a gift, a loan, or maybe even an advance against their inheritance. If it’s a loan, it’s best to make sure that it’s fully documented. Otherwise, there’s a risk that your loan may eventually be deemed a gift.
The story of Thomas Gilbert Jr. is a particularly harrowing and extreme example of what can go wrong. The son of a wealthy hedge fund manager, his parents had fully funded his Princeton education. But he struggled considerably as a young adult unable to hold a job. And his parents agreed to help him out. They funded his lifestyle with a generous allowance and by paying the rent on his Manhattan apartment.
But the parents decided to cut the allowance off when he reached age 30. Gilbert Jr., who had previously shown signs of mental illness, became enraged. He eventually shot and killed his father, and in 2019 he was sentenced to 30 years in prison for it.
If you do decide to help out your kids with cash, remember that in 2023, the gift tax annual exclusion is $17,000 for each person you make a gift to. That means that a married couple can generally gift up to $34,000 to each of their children without any tax complications.
Some parents may choose to give their kids appreciated stock instead of cash, in the belief that the stock will likely appreciate further. But there is a potential tax trap here; in most cases your cost basis in the stock will become the child’s cost basis. So if the child decides to immediately sell the stock, there could potentially be a significant capital gain. Say you bought some company stock for $5 per share and gave it to your daughter when it’s worth $50 per share. If she turned around and sold it, she would pay a capital gains tax on the $45 gain per share.
Note that this does not apply to inherited assets. If your daughter inherits the stock when you die, her cost basis would be “stepped up” to $50 per share, and she could sell it at that price without a capital gain.
There are a variety of financial, personal and emotional issues that come into play when you make a gift to an adult child. Contact your Security Mutual life insurance advisor today to review your goals and objectives for yourself, your family, or for your business. Your Security Mutual life insurance advisor will work closely with your tax and legal advisors to create a plan that best fits your goals and objectives.
More SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.
The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.
SubscribeApple PodcastsGoogle PodcastsSpotifyAndroidPandoraStitcherBlubrryby EmailTuneInDeezerRSSMore Subscribe Options
Beware of State Efforts to Tax the WealthyEpisode 221 – Several states are seeking to do what the federal government has failed to do thus far, and that is to increase taxes on the wealthy and high-income earners.
More SML Planning Minute Podcast EpisodesTranscript of Podcast Episode 221Hello, this is Bill Rainaldi with another edition of Security Mutual’s “SML Planning Minute.” In today’s episode, “Beware of State Efforts to Tax the Wealthy.”
Much of the Congressional activity, in 2021 focused on increasing taxes on the wealthy because of a perception that they were not paying their fair share of taxes. The Build Back Better Act proposal was a massive effort to impose significant taxes on the wealthy including raising income and capital gains taxes on individuals making more than $450,000 per year; tax surcharges on those making more than $5 million per year; drastic changes to many estate planning and wealth transfer strategies to inhibit the wealthy from minimizing estate and gift taxes; eliminating favorable retirement planning strategies that would reduce income taxes; and many other proposals aimed at increasing taxes on the wealthy. However, 2021 ended without any agreement on the proposal due to disagreements within the Democratic party which controlled the Presidency and both Houses of Congress.
In 2022, efforts to pass the Build Back Better Act effectively died. In its place, the Inflation Reduction Act of 2022 was passed, which made many changes to help Americans increase retirement savings, but which had few provisions aimed at increasing taxes on the wealthy.
In 2023, the Republicans regained control over the House. Because of that, few pundits are expecting any significant tax legislation this year. Individual states, however, have decided to take matters into their own hands. As of this episode, at least seven states have introduced legislation aimed at increasing taxes on the wealthy. This follows on the heels of the new Massachusetts “millionaire’s tax” passed late last year but effective in 2023, imposing an additional 4% income tax on those making over $1 million per year. These seven states include New York, California, Connecticut, Hawaii, Illinois, Maryland and Washington.
The various state proposals run the gamut from increasing the highest state income tax rates; implementing or increasing capital gains tax rates based upon level of income; establishing a mark-to market tax based upon asset levels (i.e., end of year asset values will be taxed as if they were sold if the aggregate values exceed a certain threshold such as $1 billion sometimes referred to as “wealth tax”); creating a surtax on capital gains for individuals over certain income thresholds; increasing corporate tax rates; and more.
Unlike the Massachusetts millionaire’s tax, legislation in all of these other states are only at the proposal stage. Yet it is clear that these state legislatures and governors are intent on doing what the federal government has failed to do thus far, and that is to tax the wealthy because of the perception that they are not paying their fair share of taxes.
If and when these proposals are enacted into law, planning strategies to minimize these taxes could be helpful to high-income and high-net-worth residents in those states. So, residents need to keep a watchful eye on state legislative developments.
More SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.
The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.
SubscribeApple PodcastsGoogle PodcastsSpotifyAndroidPandoraStitcherBlubrryby EmailTuneInDeezerRSSMore Subscribe Options
What to Expect When You’re Expecting an InheritanceEpisode 219 – What do you do if you’ve just been notified that you’re about to receive an inheritance? Do you know what comes next? Here are some things that you might expect.
Transcript of Podcast Episode 219Download The Transcript/FlyerMore SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.
The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.
SearchSearch for:Company News Categories* COVID-19 (coronavirus) Information * All News & Articles * SML Planning Minute Podcast * Estate Planning * Personal Planning * Retirement Planning * Social Security Planning * Asset Protection * Business Planning * Chronic Illness * College Planning * Key Person Protection
Five Strategies for a More Financially Sound 2023Episode 218 – New Year’s resolutions rarely work out. Instead, how about making some small changes in your financial habits? Here are five simple things you can try.
Transcript of Podcast Episode 218Download The Transcript/FlyerMore SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.
The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features may vary by state.
SearchSearch for:Company News Categories* COVID-19 (coronavirus) Information * All News & Articles * SML Planning Minute Podcast * Estate Planning * Personal Planning * Retirement Planning * Social Security Planning * Asset Protection * Business Planning * Chronic Illness * College Planning * Key Person Protection
Do Seniors Need Life Insurance?Episode 217 – You’re nearing or in retirement and the kids have graduated from college, out of the house, or are, at least, gainfully employed. You don’t need life insurance anymore, right? Think again!
Transcript of Podcast Episode 217Download The Transcript/FlyerMore SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.
The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features my vary by state.
SearchSearch for:Company News Categories* COVID-19 (coronavirus) Information * All News & Articles * SML Planning Minute Podcast * Estate Planning * Personal Planning * Retirement Planning * Social Security Planning * Asset Protection * Business Planning * Chronic Illness * College Planning * Key Person Protection
Six Common Life Insurance Mistakes – Part OneEpisode 215 – Most people don’t like thinking about life insurance but understand its importance to providing financial protection to their family or business. That conflict causes many to make mistakes with life insurance.
Transcript of Podcast Episode 215Download The Transcript/FlyerMore SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features my vary by state.
SearchSearch for:Company News Categories* COVID-19 (coronavirus) Information * All News & Articles * SML Planning Minute Podcast * Estate Planning * Personal Planning * Retirement Planning * Social Security Planning * Asset Protection * Business Planning * Chronic Illness * College Planning * Key Person Protection
Estate Planning After Divorce or the Death of a SpouseEpisode 214 – Every year a substantial number of people go from married to single, either through divorce or death. A recent article looked at some of the estate planning steps you may need to take if it happens to you.
More SML Planning Minute Podcast EpisodesTranscript of Podcast Episode 214Hello this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In today’s episode, Estate Planning After Divorce or the Death of a Spouse.
One oft-repeated statistic is that half of all marriages end in divorce. That estimate may have been accurate a few decades ago, but more recent statistics indicate that the current number may be closer to 40 percent. This is good news, but it’s still true that an enormous number of adults go from married to single every year, either through divorce or death.
And when the change does occur, there are often things that the newly single miss, or never even think of when it comes to their estate planning. A recent article at ThinkAdvisor.com, written by Roger Wohlner, covered eight important estate planning steps for newly single clients. Here they are in order.
1. Discuss Planning Objectives
It’s almost certain that your objectives are going to change when you are newly divorced or widowed. The author suggests staying away from technical issues at first and focusing on your distribution desires, which have likely changed since when you were married.
2. Update Beneficiary Designations
Many people seem to forget that you can’t change the distribution of certain assets simply by changing your will. This often comes into play with retirement plans, IRAs, life insurance policies, and employer-provided group life insurance, where a change in beneficiary may be required. This is an especially significant concern when you get divorced as you may not want your ex to benefit from your assets. You need to make sure that your intended heirs are named as the beneficiaries.
3. Revisit Wills
Reviewing your will from time to time is a good idea, but it becomes critical when the potential beneficiaries change. This is true whether the change is due to the death of a spouse or divorce. Either way, you need to make sure that your assets are distributed in accordance with your (revised) wishes.
4. Revise Trusts
Many people–especially high net worth individuals–like to use trusts as estate planning tools. Structured properly, they can be effective in protecting family assets from creditors, divorce and mismanagement.
Very often, when family circumstances change, family trusts need to change. But there are limitations. Revocable trusts are usually easy to change. Not so with irrevocable trusts. If a change is required, you will need the help of an estate planning attorney.
5. Retitle Accounts and Other Assets
It is likely that some assets will need to be re-titled when you get divorced or your spouse dies. When a spouse dies, it is common that the surviving spouse will need to change the title on what was their primary residence, but this can apply to other accounts as well. With a divorce, title changes become part of the divorce settlement.
6. Name Durable Powers of Attorney
A durable power of attorney is a common estate planning technique. It allows you to specify someone else to act on your behalf in the event of disability or incapacity.
It is common for spouses to name each other as their agent in this capacity. When circumstances change, you may need to name someone else you trust to protect your finances as the agent on your power of attorney.
7. Name Medical Powers of Attorney
A medical power of attorney is commonly referred to as a health care proxy. This is where you appoint someone to make medical decisions on your behalf if you’re unable to do so. When your spouse dies or you get divorced, the document will likely need changing.
8. Decide Guardianship of Minor Children
This decision is complicated enough when both parents are alive. It’s even more complicated—and more critical—when one of the spouses dies. You need to find someone you trust to act as guardian in the event of your own death or incapacity. This may not be the case when there’s a divorce rather than a death. It all depends on the family situation.
People who are newly single almost always face a daunting series of emotional and financial challenges. While this list does not include every conceivable scenario; simply because every situation is different, it certainly provides a good place to start.
More SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.
The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features my vary by state.
SearchSearch for:Company News Categories* COVID-19 (coronavirus) Information * All News & Articles * SML Planning Minute Podcast * Estate Planning * Personal Planning * Retirement Planning * Social Security Planning * Asset Protection * Business Planning * Chronic Illness * College Planning * Key Person Protection
SECURE 2.0 is Now Law. How Does That Impact Retirement Planning? Part TwoEpisode 213 – Part Two: SECURE 2.0 is now law. What does it mean for your individual retirement planning goals? What does it mean for your business and your employer-sponsored retirement plan?
More SML Planning Minute Podcast EpisodesTranscript of Podcast Episode 213Hello this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In todays’ episode, SECURE 2.0 is Now Law. How Does That Impact Retirement Planning? Part two.
In our previous episode, we examined how SECURE 2.0 affects individuals. Today we take a look at how the new law affects small businesses.
For small businesses:
- All newly established 401(k) and 403(b) plans must contain provisions to automatically enroll employees at a minimum deferral of 3% but no more than 10%, unless they opt out. The plan must also have provisions to automatically escalate a participant’s deferral percentage each year by 1% until a contribution limit of 10% is reached, unless they opt out. There are some exceptions for new businesses less than 3-years old, small businesses with 10 or fewer employees, government and church plans.
- The original SECURE Act gave startup businesses with up to 100 employees a tax credit equal to 50% of administrative costs, capped annually at $5,000. Beginning in 2023, eligible businesses with 50 or fewer employees can qualify for a credit equal to 100 percent of the administrative costs for establishing a workplace retirement plan. Eligible businesses with 51 to 100 employees remain subject to the original SECURE Act provision.
- Beginning in 2023, eligible businesses with up to 100 employees may be entitled to a tax credit based on their employee matching or profit-sharing contributions. This credit, which caps at $1,000 per employee, phases down gradually over five (5) years and is subject to further reductions for employers with 51 to 100 employees.
- The original SECURE Act required that employees who had at least 500 hours of service in each of three consecutive years be permitted to make elective deferrals to an employer’s 401(k) plan (but with no requirement for an employer to provide matching or other employer contributions). SECURE 2.0 shortens the eligibility requirement to two years effective for plan years beginning after December 31, 2024.
- Effective for plan years beginning after 2023, 401(k), 403(b) and nongovernmental 457(b) plan sponsors are able to make matching contributions to employees for certain “qualified student loan payments” made by the employees for higher education expenses and to have these matching contributions treated as regular matching contributions for discrimination testing purposes. This provision is intended to make it easier for employers to provide employer-matching contributions to employees who are paying off student loans in lieu of making retirement plan contributions.
- Employers have traditionally been prohibited from providing small incentives (such as Amazon or Starbucks gift cards) to employees to contribute to a retirement plan, other than matching contributions. SECURE 2.0 loosens this restriction and allows employers to provide “de minimis financial incentives” that are not paid for with plan assets. SECURE 2.0 does not include any guidance on what constitutes a “de minimis financial incentive,” which presumably will be left to guidance from the Internal Revenue Service.
- Beginning in 2024, 401(k) and 403(b) plans are allowed to create “emergency savings accounts” that permit non-highly compensated employees to make Roth after-tax contributions to a special savings account within the retirement plan. Balances in an emergency savings account must be eligible for distribution at least once per month, and contributions cannot be made to an emergency savings account that would cause the balance to exceed $2,500 (adjusted for inflation after 2024), or a lesser amount established by the plan sponsor. In addition, an employee’s contributions to the emergency savings account must be eligible for matching contributions at the same matching rate established under the plan for elective deferrals. However, the matching contributions are not made to the emergency savings account.
- Beginning in 2024, the spousal attribution rules will not apply to spouses with separate businesses in community property states. This change will affect controlled groups rules, which can be a complex analysis for individuals who own multiple trades or businesses.
As we previously indicated, this is just a quick summary of a few of the many provisions that impact the retirement planning goals of individuals, as well as the retirement plans sponsored by employers. There are many other provisions to consider which may impact your unique situation. Contact your Security Mutual Life insurance advisor today to review your goals and objectives for yourself, your family, or for your business. Your SML insurance advisor will work closely with your tax and legal advisors to create a plan that best fits your goals and objectives.
More SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.
The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features my vary by state.
SearchSearch for:Company News Categories* COVID-19 (coronavirus) Information * All News & Articles * SML Planning Minute Podcast * Estate Planning * Personal Planning * Retirement Planning * Social Security Planning * Asset Protection * Business Planning * Chronic Illness * College Planning * Key Person Protection
SECURE 2.0 is Now Law. How Does That Impact Retirement Planning? Part OneEpisode 212 – Part One: SECURE 2.0 is now law. What does it mean for your individual retirement planning goals? What does it mean for your business and your employer-sponsored retirement plan?
More SML Planning Minute Podcast EpisodesTranscript of Podcast Episode 212Hello this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In todays’ episode, SECURE 2.0 is Now Law. How Does That Impact Retirement Planning? Part one.
On December 29, 2022, President Joe Biden signed into law the Consolidated Appropriations Act, 2023 (“the Act”) which funds the federal government and a range of domestic and foreign priorities through the end of the fiscal year ending September 30, 2023. The Act also funds continuing assistance for the ongoing war in Ukraine.
For Americans trying to save enough for retirement, the most important section of the Act is the portion often dubbed the SECURE Act 2.0 or more appropriately the Setting Every Community Up for Retirement Enhancement 2.0 Act of 2022 (“SECURE 2.0”). The original SECURE Act or Setting Every Community Up for Retirement Enhancement Act of 2019 was signed into law by President Donald Trump on December 20, 2019. The SECURE Act made many changes to the retirement landscape including, raising the age in which to commence required minimum distributions (“RMDs”) from age 70 ½ years to 72 years; eliminating the Stretch IRA concept by requiring inherited IRAs to be distributed to beneficiaries within 10 years from the original account owner’s death with some exceptions; and many other changes to IRAs and employer sponsored retirement plans.
SECURE 2.0 builds upon the original SECURE Act in a few notable ways. There are numerous provisions that impact individual savers as well as businesses that sponsor qualified retirement plans for their workers. We will summarize just a few of those provisions.
For individuals:
- SECURE 2.0 will increase the age for RMDs again, over time. The RMD age will be 73 for those individuals who attain age 73 in 2023 or later, and age 75 for individuals who attain age 75 in 2033 and later.
- Employees who are age 50 or older currently may make catch-up contributions to their retirement plans such as 401(k) and 403(b) plans and SIMPLE plans to certain inflation-adjusted limits. In 2023 those limits are $7,500 for 401(k) and 403(b) plans, and $3,500 for SIMPLE plans. Starting in 2025, these limits will be increased for employees between the ages of 60 and 63 to the greater of $10,000 ($5,000 for SIMPLE plans) or 150% of the “regular” catch-up amount in 2024 (2025 for SIMPLE plans).
- In an apparent effort to raise tax revenue, effective for tax years beginning after 2023, catch-up contributions to 401(k), 403(b), and governmental 457(b) plans by employees whose wages exceed $145,000 (as indexed for inflation) must be made on a Roth basis. This Roth treatment of catch-up contributions is mandatory for any plan that makes catch-up contributions available.
- Beginning in 2024, beneficiaries of 529 college savings accounts will be able to make direct trustee-to-trustee rollovers from a 529 account in their name to their Roth IRA without tax or penalty. This provides an option for 529 accounts that have a balance remaining after the beneficiary’s education is complete. The 529 account must have been open for more than 15 years and the rollover can’t exceed the aggregate amount contributed to the account (and earnings thereon) more than five years before the rollover. Furthermore, aggregate rollovers under the provision cannot exceed $35,000 over the beneficiary’s lifetime. Rollovers are subject to the Roth IRA annual contribution limits, but the limit based on the taxpayer’s adjusted gross income is waived.
- Formerly, failure to take a RMD resulted in a 50% excise tax. In other words, half of the RMD was forfeited, a seemingly draconian measure. That excise tax has now been reduced to 25% or, if the failure to take the RMD is corrected in a timely manner, to 10%. This provision is effective in 2023.
- Previously, Roth IRA owners were not subject to the RMD rules, but Roth accounts in 401(k) and 403(b) plans were. Starting in 2024, those inconsistent rules will be aligned. Roth accounts in employer-sponsored retirement plans will now be exempt from the RMD rules while the participant is alive.
- The current Saver’s Credit that provides lower-income individuals with an incentive to save for retirement each year will be converted to a Saver’s Match beginning in 2027. The Saver’s Match will be a federal matching contribution deposited to a taxpayer’s IRA or retirement plan in an amount up to 50% of their contributions (phased out as the individual’s income increases), capped at a maximum of $2,000 and reduced by certain distributions that are taken by the individual.
- Currently, participants of defined contribution plans and IRAs may have the ability to use up to the lesser of 25% of their account or $145,000 to purchase a qualified longevity annuity contract (“QLAC”) that begins payment at or near the end of the participant’s life expectancy. QLACs are intended to protect against a participant outliving their retirement assets. SECURE 2.0 repeals the 25% limit and increases the dollar amount to $200,000 (indexed for inflation) for newly purchased QLACs.
- Starting in 2026, all retirement plan participants will be able to withdraw up to $2,500 annually from their plan without a premature distribution penalty for the payment of long-term care insurance premiums, whether in a standalone policy or a hybrid life insurance or annuity policy.
- Beginning for tax years after December 31, 2026, first responders can exclude from gross income certain service-related disability pension or annuity payments after they reach retirement age.
- There are various provisions that provide for penalty free distributions made prior to age 59 ½ for cases of domestic abuse, terminal illness, or certain other emergency expenses.
As we previously indicated, this is just a quick summary of a few of the many provisions that impact the retirement planning goals of individuals, as well as the retirement plans sponsored by employers. There are many other provisions to consider which may impact your unique situation. Contact your Security Mutual Life insurance advisor today to review your goals and objectives for yourself, your family, or for your business. Your SML insurance advisor will work closely with your tax and legal advisors to create a plan that best fits your goals and objectives.
This concludes part one. In our next episode, we will examine how Secure 2.0 affects small businesses.
More SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.
The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features my vary by state.
SearchSearch for:Company News Categories* COVID-19 (coronavirus) Information * All News & Articles * SML Planning Minute Podcast * Estate Planning * Personal Planning * Retirement Planning * Social Security Planning * Asset Protection * Business Planning * Chronic Illness * College Planning * Key Person Protection
Stretch IRA Substitute RevisitedEpisode 210 – We take a look back at how the SECURE Act eliminated the use of the “stretch” IRA, but there may be a way to replace that lost wealth and accomplish a similar goal by using the combination of a life insurance trust and a Single Premium Immediate Annuity.
Transcript of Podcast Episode 210Download The Transcript/FlyerMore SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.
The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features my vary by state.
SubscribeApple PodcastsGoogle PodcastsSpotifyAndroidPandoraStitcherBlubrryby EmailTuneInDeezerRSSMore Subscribe Options
IRS Provides Relief for Missed RMDs in 2021 or 2022Episode 208 – IRS provides relief to individuals who inherited traditional IRAs in 2020 or after and failed to take required minimum distributions.
More SML Planning Minute Podcast EpisodesTranscript of Podcast Episode 208Hello this is Bill Rainaldi, with another edition of Security Mutual’s SML Planning Minute. In today’s episode, IRS Provides Relief for Missed RMDs in 2021 or 2022.
As we all know, IRA owners can leave the account balances in their traditional IRAs, upon death, to their designated beneficiaries. These are known as inherited IRAs. For many years, designated beneficiaries could take required minimum distributions (“RMDs”) over their life expectancies. Spouses had the further option to take the IRA as their own and continue it. For young beneficiaries, that allowed for many years and potentially many decades of continued tax-deferred growth. This was known as the Stretch IRA concept used by many who did not need the inherited IRA assets for their own financial needs.
On December 20, 2019, the “Setting Every Community Up for Retirement Enhancement” Act (SECURE Act) was enacted into law. The SECURE Act eliminated the Stretch IRA concept. For years 2020 and later, the remaining account balance of an inherited IRA was required to be distributed to designated beneficiaries by December 31st of the 10th calendar year after the year of death, unless the designated beneficiary qualified as an “eligible designated beneficiary,” a new term created by the SECURE Act. This is commonly known as the 10-year rule. Eligible designated beneficiaries include the spouse, a disabled or chronically ill beneficiary and a beneficiary who is not more than 10 years younger than the decedent IRA owner. Eligible designated beneficiaries can continue to take distributions from inherited accounts over their life expectancies, subject to certain other rules that we won’t discuss here.
Since the passage of the SECURE Act, most tax professionals and indeed, the IRS itself, interpreted the 10-year rule to mean that when the participant died, the beneficiary did not need to take any distributions from the IRA until the end of the 10th year following the participant’s death. In the 2021 version of IRS Publication 590-B, the IRS advised: “The 10-year rule requires the IRA beneficiaries who are not taking life expectancy payments to withdraw the entire balance of the IRA by December 31 of the year containing the 10th anniversary of the owner’s death. For example, if the owner died in 2021, the beneficiary would have to fully distribute the IRA by December 31, 2031. The beneficiary is allowed, but not required, to take distributions prior to that date.”
On February 23, 2022, the IRS released proposed regulations containing a big surprise. The proposed regulations interpreted the 10-year rule as follows: If the plan participant died on or after her required beginning date (i.e., age 72), then under the 10-year rule, the designated beneficiary is required to take required minimum distributions in years one through 9, based on life expectancy, and the remaining account balance in year 10. If the plan participant died prior to her required beginning date, then under the 10-year rule, the designated beneficiary is not required to take RMDs but must take the account balance out by the end of year 10.
What that means is that the proposed regulations reinstall different rules dependent upon whether the IRA owner died before, or on or after, the required beginning date – something that most tax advisors thought the SECURE Act was trying to avoid. In addition, and perhaps more troublesome, some beneficiaries who may have inherited an IRA in 2020 or after, may have already missed a RMD distribution in 2021 or 2022 even though they didn’t know they had to take it. As a result, an excise tax equal to 50% of the RMD that was not distributed may be due.
Fortunately, on October 7, 2022, the IRS published Notice 2022-53. The Notice provides that final regulations will be coming soon and that the excise tax penalty for those who missed the 2021 or 2022 RMDs because of the most recent interpretation of the 10-year rule will be waived. Note, however, that the waiver does not affect lifetime RMDs for IRA owners who are unaffected by the 10-year rule. The waiver in the Notice also does not apply to eligible designated beneficiaries, who are not subject to the 10-year rule, nor beneficiaries who inherited the IRA before 2020.
For those taxpayers who thought they owed the excise tax and paid it, they could apply for a refund. For those who took distributions in 2021 and 2022, unfortunately, they cannot reverse that decision and must still pay income taxes on those distributions.
While the IRS has stated that it expects to publish final regulations soon, and that those regulations will be effective no earlier than 2023, additional changes to the rule may still occur. So, stay tuned! Distributions over the 10-year period may still be warranted, if for no other reason than to spread out the income tax burden and to manage income tax brackets.
More SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.
The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features my vary by state.
SearchSearch for:Company News Categories* COVID-19 (coronavirus) Information * All News & Articles * SML Planning Minute Podcast * Estate Planning * Personal Planning * Retirement Planning * Social Security Planning * Asset Protection * Business Planning * Chronic Illness * College Planning * Key Person Protection
Social Security and Medicare COLAs AnnouncedEpisode 207 – Next year’s 8.7% COLA increase for Social Security and reduction in Medicare Part B premiums are welcome news. But how good is the news really?
More SML Planning Minute Podcast EpisodesTranscript of Podcast Episode 207Download The Transcript/FlyerMore SML Planning Minute Podcast EpisodesThis podcast is brought to you by Security Mutual Life Insurance Company of New York, The Company That Cares®. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the Company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information.
The information presented is designed to provide general information regarding the subject matter covered. It is not to serve as legal, tax or other financial advice related to individual situations, because each individual’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation.
To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual Life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLNY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time.
The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not be appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features my vary by state.
SearchSearch for:Company News Categories* COVID-19 (coronavirus) Information * All News & Articles * SML Planning Minute Podcast * Estate Planning * Personal Planning * Retirement Planning * Social Security Planning * Asset Protection * Business Planning * Chronic Illness * College Planning * Key Person Protection
Episode 207 - Next year’s 8.7% COLA increase for Social Security and reduction in Medicare Part B premiums are welcome news. But how good is the news really?
Episode 205 - The holiday season is also the season of charitable giving which most people do through gifts of cash. But donating highly appreciated assets like publicly traded securities is much better.
Episode 206 - 2022 midterm elections are over and legislative gridlock will continue. That’s why it is important to plan for our future financial security against the unexpected.
Episode 205 - The holiday season is also the season of charitable giving which most people do through gifts of cash. But donating highly appreciated assets like publicly traded securities is much better.
Episode 204 - A holographic will is basically a handwritten document that could be someone’s last will and testament. But can an email also be a holographic will? The recent death of Anne Heche has raised this question.
Episode 203 - Congress is worried about Americans’ insufficient retirement savings and you should too. Various legislative proposals seek to address these concerns.
Episode 202 - IRS extends the deadline to file for portability of the estate tax exemption amount after the first spouse’s death.
Episode 201 - What do you do when you need cash in a hurry? A recent article came up with five options that you might not have thought of. We analyze them here.
Episode 200 - Life insurance is a critical part of any estate plan. But just having it is not enough; you need to get the details right. A recent article outlined 10 of the biggest mistakes people make when buying life insurance.
Episode 199 - If you’re a business owner, by now you’ve undoubtedly heard of the Great Resignation, sometimes known as the Great Reshuffling.
Episode 198 - The Inflation Reduction Act of 2022 provides long overdue healthcare relief to seniors and retirees.
Episode 197 - In the past year or so, the Great Resignation has evolved into the Great Reshuffling. But what happens to your Social Security if you retire and then decide to go back to work?
Episode 196 - Single parents must have their financial house in order, through insurance, financial and estate plans, to ensure that they protect their sources of income, existing assets and their children.
Episode 195 - Estate and gift taxes are financial considerations only for the wealthy, right? Maybe, maybe not! It depends!
Episode 194 - The problem of identity theft has grown more severe in recent years. As the IRS recently said in its Taxpayer Guide to Identity Theft, there are steps you can take to protect yourself.
Episode 193 - How much do people really know about their 401(k)? The latest research is not encouraging.
Episode 192 - On August 16, 2022, President Joe Biden signed into law the Inflation Reduction Act of 2022 to expand affordable healthcare and combat climate change. It did not materially impact income and estate tax planning.
Episode 191 - Section 529 plans have long been a common method for a grandparent to help fund college expenses. And a new rule could make them even more popular.
Episode 190 - Regardless of what you want to do with your wealth, such as leaving it to family, charity, government, or spending it all, you will need to plan for your intended outcome. Doing nothing is not going to work.
Episode 189 - While Roth IRAs are very attractive because of tax-free growth and tax-free qualified distributions, there are many considerations when deciding to convert a Traditional IRA to a Roth IRA.
Episode 188 - COVID-19 changed the financial world forever, and client communications are no exception. Learn what's new here, with special guest Marvin Bulas.
Episode 187 - The trend is undeniable. Many people are moving from high tax states to low tax states. But is it really worth it?
Episode 186 - The “Dirty Dozen” IRS annual list of Tax Scams for 2022 has been released. What new things are they focused on?
Episode 185 - Generally, when discussing life insurance, individuals want the largest amount of death benefit for as little cost as possible. However, we must take into account your protection goals while staying within your budget. The balancing act comes in when your life insurance goals and budget are aligned.
Episode 184 - ESG investing has become increasingly popular in recent years, but what exactly is it? And more importantly, as government agencies start taking a closer look, can its success continue?
Episode 183 - The Social Security Trustees issued their annual report in June. The news is mostly good, but not entirely.
Episode 182 - It’s hard to believe, but the oldest millennials are already approaching middle age. What makes them different from a financial point of view?
Growing With Your Life Insurance Policy Revisited
Episode 181 - We take a look back at one of our favorite previous episodes that discusses how most consumers don’t understand the different types of life insurance available and the roles each plays. Purchasing a whole life insurance policy on a minor child is a great gift and wise planning strategy to protect the child’s insurability and to grow cash values for the child’s future lifetime needs. The death benefit can be there to help protect the child’s future family regardless of what happens later.
Transcript of Podcast Episode 181
Download The Transcript/Flyer
More SML Planning Minute Podcast Episodes
This podcast is brought to you by Security Mutual Life Insurance Company of New York, the Company that cares. The content provided is intended for educational and informational purposes only. Information is provided in good faith. However, the company makes no representation or warranty of any kind regarding the accuracy, reliability, or completeness of the information. The information presented is designed to provide general information regarding the subject matter covered. It is not to serve at legal, tax or other financial advice related to individual situations, because each person’s legal, tax and financial situation is different. Specific advice needs to be tailored to your situation. Therefore, please consult with your own attorney, tax professional and/or other advisors regarding your specific situation To help reach your goals, you need a skilled professional by your side. Contact your local Security Mutual life insurance advisor today. As part of the planning process, he or she will coordinate with your other advisors as needed to help you achieve your financial goals and objectives. For more information, visit us at SMLY.com/SMLPodcast. If you’ve enjoyed this podcast, tell your friends about it. And be sure to give us a five-star review. And check us out on LinkedIn, YouTube and Twitter. Thanks for listening, and we’ll talk to you next time. The applicability of any strategy discussed is dependent upon the particular facts and circumstances. Results may vary, and products and services discussed may not appropriate for all situations. Each person’s needs, objectives and financial circumstances are different, and must be reviewed and analyzed independently. We encourage individuals to seek personalized advice from a qualified Security Mutual life insurance advisor regarding their personal needs, objectives, and financial circumstances. Insurance products are issued by Security Mutual Life Insurance Company of New York, Binghamton, New York. Product availability and features my vary by state.
Search
Search for:
Company News CategoriesCOVID-19 (coronavirus) Information All News & Articles SML Planning Minute Podcast Estate Planning Personal Planning Retirement Planning Social Security Planning Asset Protection Business Planning Chronic Illness College Planning Key Person Protection
Episode 180 - We’ve all heard stories of Thanksgiving dinners gone terribly wrong. The food is great, the mood is good, and everyone is happy to see each other. But it all goes terribly wrong when politics enters the room.
Episode 179 - The word “irrevocable” sounds so formal and final. Fortunately, in the world of estate planning, particularly in today’s modern times, irrevocable does not truly mean irrevocable.
Episode 178 - The IRS issued SECURE Act proposed regulations earlier this year. The new rules, while not finalized yet, contain surprises that were not apparent at first glance, especially when it comes to RMDs.
Episode 177 - What exactly is "bank on yourself" and how does it work? In this podcast, we learn all the details you need to know from Regional Vice President Marty Smith.
Episode 176 - Savings rates have dropped dramatically in recent decades. What can be done to change this? Financial literacy education can help. But recent studies show that understanding financial psychology can make an even bigger difference.
Episode 175 - Between personal responsibilities and career commitments we tend to overlook the fact that there are certain basic areas that we need to pay attention to. If these basic areas are not addressed. there may be serious gaps in our financial plan. Learn just how critical this is as we revisit one of our popular episodes.
Episode 174 - The so-called “Great Resignation” has had a significant impact on the way we work. What are the long-term implications?
Episode 173 - The crisis in Ukraine has brought out the spirit of generosity in many Americans. But with so many potential ways to help, how can we be sure we’re not getting scammed?
Episode 172 - As the annual Trustees’ report looms, there have been a number of proposed “fixes” to the Social Security system. Is an increase in Full Retirement Age a possibility?
Episode 171 - George Mallory may—or may not—have been the first man to summit Mt. Everest. But he never gets credit for it. He apparently died on his way back down the mountain. In this episode we revisit how this may have parallels to your financial life.
Episode 170 - Fair vs equal. Leaving your estate in equal shares to each of your children may not necessarily be the most beneficial or effective for your children.
Episode 169 - A comprehensive continuity and succession plan is vital to the continued success of the business but, as PricewaterhouseCoopers discovered, not enough family businesses have them.
Episode 168 - After more than 2 years, the IRS has finally gotten around to issuing proposed RMD regulations related to the Secure Act. And there are a few surprises.
Episode 167 - In today’s episode, we are going to take a look back at one of our favorite previous episodes, we’re going where no one has gone before, talking about what some people think is a dirty word: annuities!
Episode 166 - What does life insurance have to do with divorce? Life insurance and divorce intersect in several ways.
Episode 165 - Life insurance can be used to avoid estate tax planning fatigue caused by ever-changing tax laws and political environments.
Episode 164 - Trustees of irrevocable life insurance trusts or ILITs are often family members or friends of the trust creator, who are not familiar with the many duties and responsibilities that the role requires.
Episode 163 - Accumulate wealth, reduce income taxes and protect your family from catastrophic life events with a universal planning strategy. Listen to part 2 of the podcast here.
Episode 162 - Accumulate wealth, reduce income taxes and protect your family from catastrophic life events with a universal planning strategy. Listen to part 1 of the podcast here.
Episode 161 - The inability of Congress to reduce by half the $11.7 million estate and gift tax exemption amount in 2021, leaves us with an even higher exemption amount for 2022.
Episode 160 - Agreeing to act as an Executor or Administrator for the estate of a deceased family member or friend is typically an act of love. However, it often requires more work and dedication than anticipated, and can involve personal liability.
Episode 159 - Not as good as advertised. The recent 5.9% Social Security COLA isn’t as good as it seems.
Elder abuse is a huge problem that’s getting even bigger. Do you know the signs of elder abuse? More important, what should you do if you suspect it’s happening to someone you know?
Episode 157 - New IRS tables will impact required minimum distributions beginning in 2022. Learn how it could impact you here.
Episode 156 - The 4% Rule has been one of the standard models of retirement planning since the 1990s. The rule, however, has come under attack of late. A recent report by Morningstar indicates that the real number is more like 3.3%. What’s a retiree to do?
Episode 155 - Deciding on when to collect Social Security is a complicated process. But it comes with surprising flexibility. And people are surprised to learn of the three “do over” options that Social Security allows.
Episode 154 - The rich and famous are prone to estate planning mistakes. Today we look at some real world examples, and the lessons we can all learn from all of them.
Episode 153- Purchasing an annuity in your Traditional IRA will guarantee that you never outlive your retirement savings and provide you with a secure, stable and stress-free retirement.
Episode 152 - Is the Social Security Administration running a scam? One prominent retirement expert thinks so.
Episode 151 - The IRS is expected to expand its efforts to discover tax evasion through increased information reporting, updated technology and increased examinations. Most of the focus will be on high-income individuals.
Episode 150- COLI is an effective tool to invest company cash in a tax-deferred growth vehicle with a death benefit component to fund a variety of business-planning needs and strengthen the company’s financial statements.
Episode 149 – A retirement savings plan is one of the most important benefits you can provide your employees. But with so many different plans to choose from, how do you determine the right plan for your business?
Episode 148 – An independent study concludes that the best retirement savings strategy includes permanent life insurance, such as whole life, and deferred income annuities with increasing income potential.
Episode 147 – Employee retention is one of the biggest concerns for business owners. Loan Split Dollar is a very popular strategy to retain high-performing skilled employees with a unique benefit, particularly in this low interest rate environment.
Episode 146 – The House recently released its tax proposals to fund the $3.5 trillion Build Back Better Act. Many provisions will impact high-income, high-net-worth individuals and small-business owners. We have created a three-part podcast series summarizing these provisions to help you consider how they may affect your financial objectives so you can start preparing for change while there is still an opportunity to do so. In this Part 3 episode, we’ll cover the proposals that affect retirement plans and corporate taxes.
Episode 145 – The House recently released its tax proposals to fund the $3.5 trillion Build Back Better Act. Many provisions will impact high-income, high-net-worth individuals and small-business owners. We have created a three-part podcast series summarizing these provisions to help you consider how they may affect your financial objectives so you can start preparing for change while there is still an opportunity to do so. In this Part 2 episode, we’ll cover the proposals that affect estate and gift taxes.
Episode 144 - The House recently released its tax proposals to fund the $3.5 trillion Build Back Better Act. Many provisions will impact high-income, high-net-worth individuals and small-business owners. We have created a three-part podcast series summarizing these provisions to help you consider how they may affect your financial objectives so you can start preparing for change while there is still an opportunity to do so. In this Part 1 episode, we’ll begin with income taxes.
Episode 143 - September is a great time to be thinking about life insurance, and today we celebrate the fact that getting life insurance is much quicker and easier than it was even just a few years ago.
Episode 142 - America’s wealth gap has gotten a lot of attention lately, but did you know that it is even more pronounced when you factor in life insurance?
Episode 141 - Most business owners don’t know the true value of their company, but they need to, for a variety of reasons including business, estate and personal planning. See how your Security Mutual Life insurance advisor can help with the planning and the valuation.
Episode 140 - Saving money may seem like a low priority. But the results of not saving early or not saving enough can’t be reversed later on. More than anyone, millennials need to understand this simple lesson. Learn more in our latest podcast.
Episode 139 - The IRS recently announced its annual "Dirty Dozen" tax scams for 2021, this time with special emphasis on pandemic-related tricks.
Episode 138 - Did you know that the IRS has initiated several service improvements in recent years, all in an effort to be more taxpayer friendly? Learn more here.
Episode 137 - Have you ever wondered what happens to your Income Tax Return after you’ve filed it? Understanding the process can speed up your refund.
Episode 136 - SLATs are one of the most popular estate-planning strategies to create liquidity to pay Estate Taxes through the use of Life Insurance, while still maintaining indirect access to the cash values during your lifetime.
Episode 135 - We urge you to always be cautious and not provide sensitive information such as your Social Security number or bank account information to unknown individuals over the phone or internet. Never reveal personal data to a stranger who calls you.
Episode 134 - There are perhaps two great paradoxes about retirement that people don’t often recognize. The first is that in retirement, people live on income, not principal. The second is that for many people, their retirement fund is their favorite account while they are working, but their least favorite once they actually retire.
Episode 133 - Tax-free real estate exchanges have long been a favored technique used to defer capital gains taxes. How do they work, and are they still viable with tax changes coming?
Episode 132 - Hidden fees can have a serious long-term negative impact on a 401(k). And the problem is worse than most people realize.
Episode 130 - For businesses that employ only owners and their spouses, the Pension Protection Act of 2006 extended an unparalleled opportunity to save significant sums in a tax-favored retirement plan. Conventional wisdom of the past few decades was to use a Simplified Employee Pension (SEP). Now there is another choice that may be far better: The Micro(k)® Plan.
Episode 129 - A Health Savings Account may be an excellent way to help supplement your retirement savings as long as you are enrolled in a high-deductible health insurance plan.
Episode 128 - The term conscientious objector can be applied to more than just military service. In fact, certain members of the clergy can object to, and thus opt out of, Social Security.
Episode 127 - Mistakes are commonly made on life insurance policy beneficiary designations. Life events also necessitate changes, which is why regular reviews are important. Here are 5 more of the most common mistakes.
Episode 126 - Mistakes are commonly made on life insurance policy beneficiary designations. Life events also necessitate changes, which is why regular reviews are important. Here are 5 of the 10 most common mistakes.
Episode 125 - Do you know what a Holographic Will is? Here’s a hint: Larry King used one. But that doesn’t mean you should.
Episode 124 - You may not be wealthy enough to be subject to federal estate taxes upon your death, but your state may have other ideas.
Episode 123 - Business owners and high-net-worth individuals subject to federal or state estate and inheritance taxes should look into life insurance in an irrevocable life insurance trust for estate tax liquidity and to replace wealth lost to taxes.
Episode 122 - The Biden administration is just getting warmed up when it comes to Medicare. What are they planning?
Episode 121 - Estate planning is the process of protecting your wealth and transferring a legacy to your heirs in the manner you wish. Even the rich and famous fail to plan, resulting in disaster. Everyone needs a will and estate plan.
Episode 120 - For residents of New York State, recent statutory changes make this a great time to review your estate plan. Learn more about these changes and how they may affect your estate plan.
Episode 119 - Don't confuse Qualified Disaster Distributions (QDDs) with Coronavirus-Related Distributions (CRDs), which ended in 2020. A QDD is available only for non-COVID-19-related major disasters, such as hurricanes, wildfires, severe storms and other disasters. Learn more here, including the qualifications required to take a QDD.
Part 2: Episode 118 - The details of the American Rescue Plan Act of 2021 are complicated. Here’s a summary of the provisions related to Unemployment Assistance, Health Insurance, Earned Income Tax Credit, and Rent and Mortgage Payments.
Episode 117 - On March 11, 2021, President Biden signed into law the American Rescue Plan Act of 2021 (“ARPA”), fulfilling one of his campaign pledges to provide additional COVID-19 pandemic relief. Because ARPA was just enacted and there are numerous provisions, we will need to wait for future guidance issued by the IRS and Department of Treasury.
Episode 116 – 2020 was undoubtedly a very difficult year for many small-business owners struggling to keep their businesses afloat while their businesses were forced to close or limit operations as a result of government mandates attempting to slow or stop the spread of the coronavirus.
Episode 115 - The continuing low interest rate environment makes certain estate tax planning strategies—such as GRATs, CLATs, IDGTs and intra-family loans—more efficient for wealthy individuals and families to consider for minimizing or avoiding estate taxes.
Episode 114 - When it comes to life insurance, for most families the primary motivation for purchasing the insurance is simply because of love.
Episode 113 - The continuing low interest rate environment makes certain estate tax planning strategies—such as GRATs, CLATs, IDGTs and intra-family loans—more efficient for wealthy individuals and families to consider for minimizing or avoiding estate taxes.
Episode 111 - Most, if not all of us, own several forms of digital assets in the form of online accounts. These assets must be included in your estate plan. Failure to do so may result in the loss of financial value or sentimental and legacy value.
Episode 110 - Did you know that as of January 1, many employers are required to track the hours of their part-time employees? Find out why here.
Episode 109 - For a married couple to get the most out of Social Security, the two spouses need to coordinate benefits with each other. This is true for both typical and atypical couples.
Episode 108 - For many retirees, receiving a guaranteed lifetime retirement income from a company pension plan is no longer possible and Social Security isn’t enough. An annuity may be a solution.
On December 27, 2020, President Trump signed into law the Consolidated Appropriations Act of 2021. Here is a brief summary of some of its provisions, including additional stimulus payments and unemployment benefits.
Episode 104 - A Flexible Spending Account can be an excellent tool to help pay medical expenses. But did you know that the rules have changed in 2020?
Episode 103 - 2020 isn’t over yet, and there are still ways you can make an impact with year-end charitable giving.
Episode 102 - Is it really a good idea to live debt-free? Our special guest—Mark Willis, CFP®—shares his thoughts in response to this question.
Episode 101 - Phone scams involving people claiming to be from the IRS or Social Security Administration have been getting worse in recent years, and COVID has rapidly accelerated that trend. But there are some simple steps you can take to avoid becoming a victim.
Episode 80 - At the end of the month, so many people are left wondering: "Where did all my money go?" In this week's podcast we sit down with Tim Yurek of Tier 1 Capital, LLC, to discuss making some better choices with your cash flow.
Episode 67 – As a result of the economic impact that the novel coronavirus has had on this country, on March 27, 2020, President Trump signed into law the Coronavirus Aid, Relief and Economic Security (“CARES”) Act. This far-reaching legislation stands as the largest emergency aid package in U.S. history. Here’s a summary of the CARES Act provisions.
Episode 66 - To help the American public during the COVID-19 pandemic, the federal government has instituted some legislative measures. In this podcast, we summarize those measures, as well as provide another reminder of the CDC recommendations to help mitigate and prevent the spread of illness in our community.
Episode 64 - Families that have a child or other dependent with special needs need to plan for the financial support of that family member, potentially for his or her lifetime, which may exceed that of their own. Life insurance inside of a Special Needs Trust is the way to do it. We’ll help to examine this.
Episode 63 - RMDs from IRAs may become an issue for many taxpayers as they increase taxable income, possibly moving you into a higher tax bracket, impacting Social Security benefits and increasing Medicare premiums. For charitably inclined individuals, there may be a solution.
Episode 62 - The Section 199A deduction is complex, but for many successful pass-through business owners, there are strategies to help qualify for the deduction. Your Security Mutual life insurance advisor can help you plan to meet the income thresholds of the law.
Episode 60 - The SECURE Act eliminated the use of the “stretch” IRA, but there may be a way to replace that lost wealth and accomplish a similar goal by using the combination of a life insurance trust and a Single Premium Immediate Annuity. Learn more here.
Episode 58 - Charitable giving occurs throughout the year, not just during the holidays or at year-end. Most people engage in “checkbook philanthropy.” But did you know that there are other ways to give and make a greater impact? Life insurance is one such way. Here’s how.
Episode 56 - The SECURE Act and final anti-clawback regulations impact estate planning for wealthier individuals. The Stretch IRA is eliminated, and there will be no clawback of the basic estate and gift tax exclusion amount. Here are some things you need to know and potential solutions. Learn more in today’s podcast.
Episode 54 - If you are a business owner, you need to be aware that the SECURE Act makes several changes to employer sponsored retirement plans. Most of the changes simplify administration, but not all. Here are the main provisions impacting employer-sponsored retirement plans.
Episode 53 - The SECURE Act is now law. It significantly impacts how we save in our IRAs and retirement accounts, and how we spend those savings. Here’s a brief summary of some of the more important provisions. Contact your local Security Mutual life insurance advisor today to review how the SECURE Act impacts your financial and retirement goals and objectives.
Episode 50 - Everyone tells us that Social Security needs “fixing.” The Social Security Trust Fund, as it currently exists, is not projected to be big enough to cover all of its projected payouts beyond the year 2035. So something needs to be done. Is “means testing” the answer?
Episode 49 - Learn more about Social Security Survivor Benefits in this podcast episode of SML Planning Minute.
Episode 48 - Do you need to “audit” your life insurance policy? What should you be looking for? What questions do you need answered? In this episode, life insurance advisor John J. Doolan, MBA, shares some tips with SML Planning Minute host Bill Rainaldi.
Episode 34 - You probably know that you can save money on your car insurance if you maintain a safe driving history. But did you know that healthy living can also save you money? Security Mutual’s Healthy Living Program, or HeLP, recognizes the good health and life expectancy benefits of leading a healthy lifestyle.
Episode 29 - When it comes to claiming Social Security, one thing is abundantly clear: every situation is different. And that’s a big reason so many people end up confused. Listen to our podcast to learn 3 of the mistakes we see people make most often.
Episode 24 - For years the people at the Social Security Administration (SSA) have been telling us that your Social Security benefit is protected against inflation. The reasoning is that Cost of Living Adjustments (COLAs) added to the benefit will help offset future price increases. Listen to our podcast to learn why it just doesn’t work that way anymore.
Episode 23 - Despite the amount of life insurance in your estate, it is an asset that is generally not evaluated, reviewed, or appraised on a consistent and comprehensive basis.
Episode 22 - When someone needs long-term care, the needs of the institutionalized spouse come first, and with good reason. But what about the needs of the healthier spouse? How does that spouse fit in, and how can we help? And is Medicaid as bad as it seems?