The Secure Act of 2019 changed the rules for non-spouse beneficiaries of inherited IRAs. The rules now are simply that the beneficiary of such an IRA has 10 years to distribute it in its entirety. No required minimum distributions are necessary during this time.
This is a big change from previous rules. Prior to the Secure Act, the non-spouse beneficiary could "stretch" the IRA out of his own life expectancy. Say granddad left an IRA to the grandson. The grandson's life expectancy (from an IRS table) was 70 years. The year after death the grandson would take the beginning of year balance and divide it by 70. The following year he'd take the beginning of year balance and divide it by (70-1). And so on. The result was that the IRA could grow enormously during this time.
You can simply sell the assets and...
We broker life insurance, disability income insurance, and long-term care insurance. In obtaining Insurance coverage for our clients, We shop the market for the most suitable product at the best price.
No – that requires another license which we do not hold. As part of a complete financial planning engagement, we will evaluate the client’s risk exposure in these areas, and recommend coverage changes as appropriate. We are glad to refer you to insurance agents who can assist you with these policies. BTW we neither pay nor accept referral fees from other professionals, nor do we accept any liability for their actions.
A crucial part. A life insurance death benefit can complete the overall plan in the event of an untimely death.
The strategy is to purchase a...
From time to time I’m asked, Glenn: there are plenty of financial guys out there. They’ll do financial planning for free. So why should I pay you guys?
Good question, and not unexpected in these days of free resources online. To answer it, let me give you a little background.
Back say, 50 years ago, if you needed professional financial advice, from whom could you get it?
What’s the issue about taking advice from these providers? It is the potential for conflict of interest. What do I mean by that? Well, the banker wants to open time deposit accounts and initiate loans. The stockbroker wants to trade stocks in your account. The insurance agent makes a living selling policies. The accountant, on the other hand, focuses on preparing financial statements and doing tax returns. See my blog post about the advice industry here.
Short answer: because no one can hit a moving target. The financial plan informs all financial decisions: how to invest, what to save and where, and what insurance should I purchase or drop.
At the time you made your appointment you would have discussed your concerns with one of our associates. After determining if you would be a good fit to work with us, you have been given a list of documents to upload for the financial planners to view before your meeting.
When you come in we’ll meet in one of the conference rooms at our Miami office. We’ll give you a bit of personal introduction and will be interested to learn how you came to us.
From there, we listen and ask questions. We want a general snapshot of your financial position, and we’ll really want to understand your specific concerns and goals for our engagement.
Toward the end of this initial...
Getting financially organized before retirement can be a daunting task. There are many unknowns and it can be hard to know where to begin. For that same reason people often wait too long to address retirement needs and, unfortunately, don’t achieve the financial freedom for which they long. When people get serious about retirement, many start by analyzing their investment account(s) (or lack, thereof). Ideally, they’ll meet with a CERTIFIED FINANCIAL PLANNER™ professional to get them on track.
Financial organization starts by identifying and prioritizing what is most important to you. This is the beginning of a goals-based financial planning approach.
I start by asking clients to list what is most important to them and help them identify what they’d like to accomplish. Spending more time with family, traveling, volunteering, reading, relocating, starting a new...
In this post I’d like to give a little history and background on the advice industry. It may not grab you right off as being the most compelling reading, but please stick with it. I have some valuable points to develop. In Part II I go into some of the changes in our regulatory environment.
When I was a young teen I remember going with my father to visit his stockbroker. Dad used the occasion to teach me what owning common stock means (an ownership stake in a publicly-traded company). He explained that the broker brings buyers and sellers of securities together, and facilitates trades. For this service there is a fee on each trade – a fee on both the buy and the sell, paid by the customer to the broker.
Looking back on it, Dad was explaining to me that I, the buyer, and the broker, had a conflict of interest. My interest was getting the cheapest price for the shares. The brokers interest was...
The IRS tax code sets forth rules and regulations under which US taxpayers remit monies to the federal government. Our taxes, along with borrowing, supply the US government with its operating funds. The tax code also encourages certain behaviors, and discourages others. For example, it encourages charitable giving through generous tax deductions. Clearly it discourages speculation by taxing short term gains at one’s marginal tax rate rather than at the more favorable long term gains rate.
In this blog piece I want to describe some of the charitable giving strategies available to the affluent. I as an advisor would be remiss if I didn’t bring this conversation up to a client. Is there a church or synagogue you wish to favor? A university? A specific charity? The opera guild? There are many favorable ways to give, which can also produce a guaranteed income for the giver.
We make no recommendations before completing our due diligence. Only after we have a clear picture of your risk tolerance, income needs, tax situation, time horizon, and cash flow position do we make any investment recommendation.
There’s no such thing as a perfect investment. Each investment product on the market was designed to accomplish a specific purpose and has its own risk and reward characteristics. Whether it is a managed account with mutual funds, ETFs, individual securities, bonds, annuities and insurance products, our job is to match you with the appropriate vehicle.
Yes of course. There are several mutual fund companies that screen their underlying investments by various social and/or religious criteria.
We can do a projection for you. For example, say you want to retire 10 years from now; you want to have an income of...
To me an annuity in an IRA is usually a dead giveaway that the client worked with a salesperson and not a financial planner.
Annuities, like any other tool, are not inherently bad. They work best when they do the job they were designed to do – and that job is income distribution. The job of a retirement account, however, is asset accumulation.
Annuities can be a useful accumulation vehicle for those with a conservative investing outlook. If you can accept absolutely no investment risk then a fixed annuity is for you. If you have non-qualified money to invest (that is, not retirement funds) and you're in a high tax bracket, then an annuity might be a good option for you to defer current income taxation.
As a distribution vehicle, an annuity is also a safe way to create a perpetual stream of income without market risk. A pension payment is simply another name for an...
A lot has happened in our regulatory world since I posted the original blog piece, The Advice Industry. The DOL rule is void. The SEC is now working on final new rules for standards of client care.
The government regulates this industry – investments, advice, and insurance – via the Securities and Exchange Commission (the original 1940 Investment Advisers Act), the Department of Labor (ERISA comes under DOL, or the Employee Retirement Income Security Act), and the insurance commissioners of the 50 states. Just as it takes a team to give a client comprehensive advice (financial planner, investment adviser, estate attorney, accountant, and maybe more), apparently it takes a team of government agencies to regulate all of us in the industry to their satisfaction.
The 1940 SEC Act requires a fiduciary standard of client care for investment advisers. The SEC made concessions to the brokerage industry, known...