The IRA and 401k retirement accounts have been around forever, but with the Roth IRA being introduced about 24 years ago, how do you determine which retirement plan is best for you?
Please take a moment to listen to our Senior Vice President, Thomas Manly, on the South Carolina Business Review.
Thomas goes in depth with Mike to discuss the different benefits each plan has and how to determine which plan will be best suited for you.
Listen to the interview here
The Secure Act, passed at the end of 2019, had may significant benefits to business owners adopting a qualified retirement plan in 2020 and beyond. What does this mean for small business owner when the pandemic is in our rear view mirrors?
Please take a moment to listen to our COO and Founder, Peter Pigeon, on the South Carolina Business Review.
Pete talks with Mark about the specific tax credits that small business owners should be taking advantage of.
Listen to the interview here.
Taxes are one of the largest expenses people have, but they are often overlooked and not proactively planned for. Does that sound like you?
Please take a moment to listen to V.P. of Operations, Garet Strange, on the South Carolina Business Review.
Garet talks with Mike Switzer about the ins and outs of year end taxing planning. If you are thinking to yourself “Where should I start with my tax planning”, this 5-minute interview is just for you!
Listen to the interview here.
Please take a moment to listen to Associate Advisor Thomas Manly on the South Carolina Business Review.
Throughout this pandemic, much of the working population has lost their jobs and has been forced to seek new employment. Many of whom are left with the question: “What do I do with my old retirement plan?”
Thomas talks with Mike Switzer about the various options you have regarding old retirement plans and the importance of consulting your tax professional beforehand.
You can access and listen to this interview here.
Please take a moment to listen to our COO and Co-Founder Peter Pigeon on the South Carolina Business Review.
Have you ever noticed that your tolerance for risk may be at one level when you’re setting your goals with your financial planner, but then along comes a market downturn and suddenly you find that you might be a little more risk-averse than you thought?
Pete talks with Mike Switzer about assessing risk tolerance during unexpected downturns in the market. As a Fiduciary and Certified Financial Planner, Pete offers an objective viewpoint when his clients’ emotions take hold.
You can access and listen to this interview here.
Pain Stories:
“You need to stop going to Bonefish Grill……”
I was recently hired by a new client.
She is single and currently unemployed.
Fortunately, she has enough assets to survive without a job but would certainly be better off in the long run with one.
She is torn between both whether to rent or buy a house and where she ultimately wants to live, Columbia or the coast.
She has been a client of the same Investment Advisory firm for many years and naturally went to there for advice about her predicament.
Her advisor had to bring his resident financial planner, whom my client did not know, into the discussion since he was strictly an investment advisor and did not “do financial planning” himself.
My client left the meeting in tears because they told her that she would run out of money and be destitute in the future if she did not stop eating out twice a month with her friends.
Her advisor later apologized and expressed that he thought she could afford to buy a house, but he would have to go back to his financial planner to schedule another call.
The process kept going in circles for months.
She felt belittled and talked down to every time she asked them a question.
She didn’t feel understood or appreciated.
She was so upset by the initial conversation and ongoing interactions that she felt it was time to seek a second opinion.
She was then referred to me by a friend and we proceeded to talk through it.
I explained the trade-offs she was faced with in her situation and how renting could make great financial sense in her case, especially since she is unsure about where she ultimately would like to live.
I explained that paying rent is not necessarily throwing money away since the cost of selling a home can be very expensive, not to mention time-consuming.
She understood this all too well seeing that she lost money on the recent sale of a house purchased in 2007.
This is the difference between investment only advisory shops and financial planners
She then thanked me for making her feel comfortable and not patronizing her.
I told her that should be the bare minimum expectation when working with a professional of any kind.
My job is to do the complex work in the background and explain it to you in a way that is simple.
You should never feel anxiety before or after your discussions with your advisor.
If you do, perhaps you need to make a change.
I have had and continue to have many conversations with people who describe a lingering gut feeling that “something just isn’t right” after a questionable recommendation was made by their advisor.
Perhaps you know the feeling…
Maybe the advice or service is “just OK”, but you want or feel deserving of something more.
Don’t ever settle for “just OK”.
If you are not sure you have the right plan, or planner, or just want to get a second opinion about what you are doing, click below to schedule a call with me.
Let’s have a 15 minute phone conversation and see if it makes sense to meet.
Nothing will make you question your mortality and the associated financial risk quite like a global pandemic.
Unfortunately, as financial planners, we see too often clients with no rhyme or reason behind their financial risk management strategy.
We make it a point to have an intentional, documented insurance discussion with all of our clients.
We take an inventory of our clients’ existing policies and evaluate them regularly.
We often find insurance that isn’t worth keeping, and we recommend that our clients drop it.
We also frequently discover gaps in coverage or current policies that are not appropriate for a client’s financial situation and risk profile, and in those cases, we suggest increasing coverage or changing types of insurance.
Oftentimes, our prospects and existing clients choose to act on our recommendations.
But sometimes, they don’t.
An interesting thing has happened during this pandemic.
Clients and prospects are reaching out to us to initiate or revisit the insurance conversation.
Clients that previously believed they had enough insurance are now taking a second look at our fact-based calculations that show a much higher need.
This seems to be the case globally as life insurance companies are backlogged from a record amount of applications.
A doctor who didn’t take my recommendation about increasing his life and disability coverage 3 years ago contacted me the other day about increasing his disability income policy and applying for more life insurance.
He said he had a colleague diagnosed with cancer at age 40.
It is going to be more expensive for him now, but luckily for him and his family, he has not had any new medical issues that would disqualify him for coverage.
This doctor is a classic example of someone whose actual need for insurance is much larger than he perceives.
He has 5 kids under the age of 10, and his wife does not work.
He is the sole breadwinner. He brings home the bacon and the band-aids.
If his income were to go away, it would be financially catastrophic to his family and the lifestyle to which they are accustomed.
He didn’t believe me 3 years ago but was ready to act this time around.
We also have clients who were originally planning to let their term policies expire contact us about converting the policy to a permanent form of life insurance.
Solid, affordable insurance planning has always been part of a sound financial strategy even before COVID-19, and it will continue to be long after this pandemic is over.
Let’s discuss what the right policy looks like for you and your family.
There is no time like the present, and life insurance companies are attempting to stream line the application process to keep up with the recent in-flux of applications
If you’d like a complimentary review of your risk management strategy, please click here.
On March 27, 2020, the Coronavirus, Aid, Relief, and Economic Security (CARES) Act (the “Act”) was signed into law. A portion of the Act is intended to loosen access to retirement plan funds for individuals impacted by the COVID-19 pandemic.
It is our goal to keep both our individual and business clients as informed as possible during these troubling times. Please click the link below to download a summary of the CARES Act as it pertains to retirement plans.
As I’m sure you know, the $2 trillion “Coronavirus Aid, Relief, and Economic Security” (“CARES”) Act was recently signed into law. The CARES Act is designed to help those most impacted by the COVID-19 pandemic, while also providing key provisions that may benefit retirees.1
To put this monumental legislation in perspective, Congress earmarked $800 billion for the Economic Stimulus Act of 2008 during the financial crisis.1
The CARES Act has far-reaching implications for many. Here are the most important provisions to keep in mind:
Stimulus Check Details – Americans can expect a one-time direct payment of up to $1,200 for individuals (or $2,400 for married couples) with an additional $500 per child under age 17. These payments are based on the 2019 tax returns for those who have filed them and 2018 information if they have not. The amount is reduced if an individual makes more than $75,000 or a couple makes more than $150,000. Those who make more than $99,000 as an individual (or $198,000 as a couple) will not receive a payment.1
Business Relief – The act also allocates $500 billion for loans, loan guarantees, or investments to businesses, states, and municipalities.1
Inherited 401(k)s – People who have inherited 401(k)s or Individual Retirement Accounts can suspend distributions in 2020. Required distributions don’t apply to people with Roth IRAs; although, they do apply to investors who inherit Roth accounts.2
Suspended RMD – The CARES Act suspends the minimum required distributions most people must take from 401(k)s and IRAs in 2020. In 2009, Congress passed a similar rule, which gave retirees some flexibility when considering distributions.2,3
Withdrawal Penalties – Account owners can take a distribution of up to $100,000 from their retirement plan or IRA in 2020, without the 10-percent early withdrawal penalty that normally applies to money taken out before age 59½. But remember, you still owe the tax.4
Many businesses and individuals within our community are struggling with the new realities that COVID-19 has created. The CARES Act, however, may provide some much-needed relief for our neighbors, friends, and loved ones.
If you’d like to chat about how the CARES Act impacts you or to see if these special 2020 distribution rules are appropriate for your situation, give me a call or just hit reply.
Under the CARES act, an accountholder who already took a 2020 distribution has up to 60 days to return the distribution without owing taxes on it. This material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. Under the SECURE Act, your required minimum distribution (RMD) must be distributed by the end of the 10th calendar year following the year of the Individual Retirement Account (IRA) owner’s death. Penalties may occur for missed RMDs. Any RMDs due for the original owner must be taken by their deadlines to avoid penalties. A surviving spouse of the IRA owner, disabled or chronically ill individuals, individuals who are not more than 10 years younger than the IRA owner, and children of the IRA owner who have not reached the age of majority may have other minimum distribution requirements.
Under the CARES act, an accountholder who already took a 2020 distribution has up to 60 days to return the distribution without owing taxes on it. This material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. Under the SECURE Act, in most circumstances, once you reach age 72, you must begin taking required minimum distributions from a Traditional Individual Retirement Account (IRA). Withdrawals from Traditional IRAs are taxed as ordinary income, and if taken before age 59½, may be subject to a 10% federal income tax penalty. You may continue to contribute to a Traditional IRA past age 70½ under the SECURE Act, as long as you meet the earned-income requirement.
Accountholders can always withdraw more. But if they take less than the minimum required, they could be subject to a 50% penalty on the amount they should have withdrawn – except for 2020.
Please take a moment to listen to our COO & Co-Founder Peter Pigeon on the South Carolina Business Review. Pete talks with Mike Switzer about the emotional toll that comes with investing during a crisis and how to stay positive amidst such troubling times.
Many stock market crashes have happened in the past and every time they do, investors are faced with the emotional toll of investing during a crisis. Our next guest says there are ways to trick your brain into thinking positive in order to prevent panic.
Mike Switzer interviews Peter Pigeon, a certified financial planner with Hobbs Group Advisors in Columbia, SC.
You may listen to this interview here.
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