Retirement Planning Archives - Triton Financial Group: Recent Episodes
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You are about to retire and have created a nice retirement portfolio. But how do you ensure what you have saved will be enough money for your retirement? There is a well-known retirement spending strategy called the 4 percent rule. But is it still a valid strategy in today's world?
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© Triton Financial Group. All Rights Reserved. 4 Percent Retirement Rule – Is it Still Valid Today? is an original post from Bob Gustafson, Certified Financial Planner and Registered Investment Advisor: Triton Financial Group. If you enjoyed this post, be sure to follow Triton Financial on Facebook or LinkedIn.
Many people struggle with identifying the optimal age for claiming their social security benefits. Read on to learn what factors come into play that will help you make the best decision!
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© Triton Financial Group. All Rights Reserved. When is the Best Time to Take Social Security Benefits? is an original post from Bob Gustafson, Certified Financial Planner and Registered Investment Advisor: Triton Financial Group. If you enjoyed this post, be sure to follow Triton Financial on Facebook or LinkedIn.
A 401(k) plan is a defined-contribution retirement account, which allows you to save a portion of your pre-tax salary to the plan. Your contribution is automatically deducted from your paycheck prior to your paycheck being taxed.
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© Triton Financial Group. All Rights Reserved. Common 401(k) Plan Questions and Answers is an original post from Bob Gustafson, Certified Financial Planner and Registered Investment Advisor: Triton Financial Group. If you enjoyed this post, be sure to follow Triton Financial on Facebook or LinkedIn.
The goal is to not pay more taxes than you have to. It starts with you understanding how retirement income is taxed. Put together a strategy before retirement that will put you in the best position to minimize your taxes.
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© Triton Financial Group. All Rights Reserved. Develop A Strategy to Minimize Taxes in Retirement is an original post from Bob Gustafson, Certified Financial Planner and Registered Investment Advisor: Triton Financial Group. If you enjoyed this post, be sure to follow Triton Financial on Facebook or LinkedIn.
Before jumping into our discussion, it’s important to note that the social security program is complicated. It’s not as straight forward and easy to understand as some people may believe. There are things you need to think about before signing up for the benefits.
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© Triton Financial Group. All Rights Reserved. Social Security Benefits – What To Consider Before Applying is an original post from Bob Gustafson, Certified Financial Planner and Registered Investment Advisor: Triton Financial Group. If you enjoyed this post, be sure to follow Triton Financial on Facebook or LinkedIn.
Fixed annuities will provide a guaranteed pay-out at a rate of return over a period of time. The rate of return usually mimics current interest rates. What could ever be bad about that? Let's find out whether a fixed annuity is right for your retirement portfolio.
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© Triton Financial Group. All Rights Reserved. Fixed Annuities Pros and Cons: Are They Right For Your Retirement Plan? is an original post from Bob Gustafson, Certified Financial Planner and Registered Investment Advisor: Triton Financial Group. If you enjoyed this post, be sure to follow Triton Financial on Facebook or LinkedIn.
Charities rely on donations and for many donors, charitable giving is important to them. Many include charitable donations as part of their estate plan. So, whether you want to donate to an organization or cause that you are passionate about or help your school or university, there are steps you can take to ensure your money actually gets to them.
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© Triton Financial Group. All Rights Reserved. Charitable Giving through Estate Planning is an original post from Bob Gustafson, Certified Financial Planner and Registered Investment Advisor: Triton Financial Group. If you enjoyed this post, be sure to follow Triton Financial on Facebook or LinkedIn.
A stretch IRA is an estate planning strategy to transfer wealth to a non-spouse beneficiary. It allows your non-spouse heirs to stretch IRA distributions and benefits out over a period of time.
When you retire and start having to take minimum distributions from your IRA accounts, the stretch IRA’s goal is to take out the smallest amounts possible. You can then pass the remaining amounts on to your heirs.
In turn, your heirs can take out minimum distributions throughout their lifetime (according to an IRS table). It’s a great tool to use to minimize tax liability when passing assets on to heirs.
Benefits of the Stretch IRA So, what are the benefits? Here’s an example. Let’s say your mom has a million dollars in an IRA. You are the sole beneficiary. If your mom passes away tomorrow, you can take that million dollars and stretch it out over the course of your lifetime.
For example, let’s assume the IRS tables say you need to take out three percent annually (thirty thousand dollars). The actual amount will be more or less. Chances are you’ll be in a lower tax bracket than if you liquidated the entire amount at one time.
Why? Because your taxable income would be whatever your annual earnings are plus one million dollars, putting you in the highest marginal tax bracket possible in that year. A better strategy is to stretch the money out over the course of your lifetime to minimize the tax burden.
Proposed Legislation Unfortunately, there’s bipartisan support for doing away with the Stretch IRA or minimizing it to a specified period of time. If the latter happens, non-spouse heirs won’t be able to spread out the distributions over the course of their life. But the question remains how this change would be implemented.
People who already have inherited IRAs could be grandfathered in and may be able to continue under the Stretch IRA’s current rules. Those who haven’t inherited anything yet will fall under the new guidelines once the law goes into effect.
It’s just speculation now, as no one knows exactly how it will play out. However, we do know it would be a good inheritance planning tool taken away from financial planners. But there are other effective tax mitigation strategies available that we can discuss.
Taking IRA Distributions There’s another potential change to discuss as part of the proposed legislation. Currently, the law states at 70 and a half you need to begin taking out IRA distributions. The age could be increasing up to 73. You may wonder if it’s ever beneficial to take out money earlier.
The answer is yes. For example, say you have 1.5 million dollars in your 401K plan. You’re 60 years old and you decide to retire. Since you have no other earned income, it might make sense to take money out and keep yourself in a lower tax bracket. You could even take the money and convert it to a Roth IRA. The Roth IRA doesn’t require minimum distributions and offers tax free growth.
If you don’t take the money out earlier and you hit the required age to take distributions, those distributions could likely put you in a much higher tax bracket. By maximizing the lesser tax rate earlier, it will go a long way in helping minimize your overall tax liability throughout the course of your life.
But before making this and other financial decisions, it’s always important to consult with an expert or run the numbers yourself.
To learn more, listen to our podcast:
https://tritonfinancialgroup.com/wp-content/uploads/stretch-ira.mp3
© Triton Financial Group. All Rights Reserved. What is a Stretch IRA? is an original post from Bob Gustafson, Certified Financial Planner and Registered Investment Advisor: Triton Financial Group. If you enjoyed this post, be sure to follow Triton Financial on Facebook or LinkedIn.
Some financial planning experts believe retirement could be the longest phase of your life. Whether it is or not, all experts would agree retirement planning is important. But there are a few common retirement planning mistakes that many people make that you could easily avoid.
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© Triton Financial Group. All Rights Reserved. Common Retirement Planning Mistakes is an original post from Bob Gustafson, Certified Financial Planner and Registered Investment Advisor: Triton Financial Group. If you enjoyed this post, be sure to follow Triton Financial on Facebook or LinkedIn.
Downsizing your living arrangements has become a popular topic in the financial community and rightly so. There are many financial benefits to downsizing your home such as reduced expenses and increased cash flow.
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© Triton Financial Group. All Rights Reserved. 3 Benefits of Downsizing Your Home is an original post from Bob Gustafson, Certified Financial Planner and Registered Investment Advisor: Triton Financial Group. If you enjoyed this post, be sure to follow Triton Financial on Facebook or LinkedIn.
A 401(k) retirement plan is an employer-sponsored retirement savings program that enables employees to save for retirement by making pre-tax contributions. A 401(k) is the dominant retirement plan scheme that most people in the U.S. will use to provide a decent income once they retire.
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© Triton Financial Group. All Rights Reserved. Pros and Cons of Investing in a 401(k) Retirement Plan is an original post from Bob Gustafson, Certified Financial Planner and Registered Investment Advisor: Triton Financial Group. If you enjoyed this post, be sure to follow Triton Financial on Facebook or LinkedIn.