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Articles tagged with: tax planning

Withdrawal Strategies During Retirement

31 October 2018

Withdrawal Strategies During Retirement

You may have heard of the 4% rule for withdrawals during retirement as you approach your retirement. I would like to clarify this rule in this blog post and offer some thoughts on how to withdraw from your nest egg to make the money last for at least your lifetime.

Savings Alone Won't Pay for College

30 May 2018

Savings Alone Won't Pay for College

A college diploma opens the door to a lifetime of higher earnings. Based on Bureau of Labor Statistics, in 2016 dollars, Bachelor's degree holders earn nearly $1 million more over a lifetime than those who have only a high school diploma. Those with professional degrees earn over $2 million more. In addition, college graduates enjoy much better job security and opportunity, especially during economic downturns. Based on "The State of Entry-Level Employment in the U.S. March 2017" by The Rockefeller Foundation, seven in ten U.S. employers look for college degrees when hiring entry-level workers.

Have You Considered This Mega Roth Strategy?

24 April 2017

Have You Considered This Mega Roth Strategy?

Last month, one of my new clients and I called the administrator of her old 401(k) plan to rollover the balance to her IRA account at TD Ameritrade.  To her surprise, she had $36,000 in after-tax contributions (not the same as a Roth) with earnings of $70,000 from the after-tax contributions she made many years ago in addition to $700,000 pre-tax contributions and earnings.  She was able to request two checks - one for the $36,000 to a new Roth IRA account (a Roth conversion that is tax-free because there is no taxation on otherwise after-tax funds!) and one for the $770,000 to a traditional IRA account (which does not incur an income tax assessment by virtue of being a rollover).  The end result – now she has $770,000 of all pre-tax funds in an IRA, $36,000 in a Roth IRA, and her tax cost this year is zero!

Are Investment Advisory Fees Tax Deductible?

03 March 2017

Are Investment Advisory Fees Tax Deductible?

It’s tax season again, and a question we get from a number of clients after receiving their year end statements is, “Are my investment advisory fees tax deductible?” And the answer is an equivocal, “It depends.”

Congress did grant a tax deduction for certain investment expenses, but with anything to do with the tax code, the devil’s is in the details. Not to worry though, we’ll use this opportunity to settle the issue no matter your situation.

Why Would I Want to Defer Compensation?

23 November 2016

Why Would I Want to Defer Compensation?

An old proverb states “A bird in the hand is worth two in the bush” suggesting one should be content with what they have (or will have shortly) rather than roll the dice on the unknown.  One who wholeheartedly believes in this proverb may react swiftly and decline to enroll in their employer-offered deferred compensation plan.  This could be perceived as a rational decision; why would you want to receive a portion of your salary or bonus in 5+ years when you can receive it now?   What benefits could there be to electing to give up your bird, or compensation, and “roll the dice” on the unknown?

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