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Retirement Planning Archives - Wealthspire Advisors

401(k) contributions

Pre-tax or Roth 401(k) Contributions—That is the Question

By Blog
The decision of whether to make pre-tax or Roth (after-tax) 401(k) contributions frequently pops up, especially when investors start new jobs. Both pre-tax and Roth 401(k)s offer tax-advantaged investment growth, the same annual employee contribution limits, and both allow the plan participant to receive any available employer match. However, there are key differences between these options, so it is important to understand the pros & cons before electing whether pre-tax, Roth, or a combination of the two is appropriate for you. What is the difference between pre-tax and Roth? There are two primary differences – both of them are tax…
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social security

Social Security Optimization – What You Should Know

By , and Guides & Whitepapers
It is no secret that many Americans are ill prepared for retirement (excluding our clients, of course). With the continued disappearance of defined-benefit pension plans (apart from public sector employees), inadequate savings, and low interest rates, people are depending on Social Security now more than ever before. Despite these facts, billions of dollars in lifetime benefits are lost each year because retirees make uninformed decisions about claiming Social Security benefits. This white paper will discuss various concepts to consider in order to help maximize lifetime Social Security benefits. Regardless of whether you feel Social Security will be a major factor…
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retirement savings

A “How To” Guide to Retirement Savings for the Self-Employed

By and Blog
Recently, we received a call from a client who had previously retired but had decided to get back into the game and provide consulting services as an independent contractor. Part of the conversation was a discussion of the different approaches to consider in deferring income recognition and investing some of these newly earned funds in a tax efficient manner. Below we review some of the most common retirement savings strategies a self-employed person could utilize, and explore the pros and cons of each: Traditional IRA A traditional IRA is a method to save for retirement with tax benefits. Contributions made…
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retirement savings

SECURE Act: Changes May Be Coming Soon to Retirement Savings

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Believe it or not, there is something that Democrats and Republicans in Congress can agree on, and that is the need for all Americans to increase their retirement savings. Although there is not yet consensus on what any final legislation may look like, there are enough similarities between House and Senate proposals to believe that there could be some movement here. The Senate Finance Committee first reported the Retirement Enhancement and Savings Act (RESA) in November of 2016, followed by a House version known as the Setting Every Community Up for Retirement Act (SECURE), which passed the House Ways &…
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roth ira

What is a Mega Backdoor Roth IRA?

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Most people have heard of Roth IRAs. Those that qualify typically contribute and those that do not qualify can sometimes find a way to do so, as Zach Gering indicates here. In either case, you can do MORE. Take a step back and understand plan types and limits Depending on your current occupational status and business structure, you may or may not be able to open any of the accounts noted above. For starters, any individual can open an IRA (with certain age/income requirements). All of the other plans must be company sponsored. An optimal retirement plan design permits annual…
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backdoor roth contribution

The Benefits of a Backdoor Roth Contribution

By Blog
It is that time of the year – with tax season comes retirement account contribution season! The most popular retirement account of the current decade is the Roth IRA. It offers tax-free growth, tax-free withdrawals after age 59.5, and no minimum distribution requirements. Unlike traditional IRAs, Roth’s are funded with after-tax dollars. There is no tax deduction for contributing. Evaluating whether to contribute to a pre-tax or Roth IRA is a common exercise. A prevalent misconception is choosing a pre-tax account is the best option. This is mostly because the investor expects that his tax rate will decline in retirement.…
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long-term care

How to Plan for Long-Term Care Costs

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Many of us think it won’t happen to us, but the statistics say otherwise. 52% of Americans turning 65 will need some type of long-term care services during their lifetimes. The costs quickly climb financially, as do the physical and emotional stresses. The questions that often follow are: how to pay for it all, and what, if anything, can be done to prepare ahead of time. The answers are not easy, but remember, failure to plan is a plan itself. Who pays for long-term care costs? The first answer that comes to mind for many is Medicare or associated Medicap…
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long term care

Defining your Objectives for Long-Term Care

By Guides & Whitepapers
Americans are living longer and healthier lives than at any other time in history. Average life expectancy in the US is 78.7 years and continues to rise. For those without chronic illness, it is realistic to plan to live well into the 90’s. Longer lifespans come with a higher likelihood that aging adults will eventually need some sort of help with the daily functions of living. In fact, 7 out of 10 will need help in some form – either from a family member or a paid caregiver – and 9 out of 10 who receive that care will not fully recover their…
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Roth IRA

Converting to a Roth IRA: When Does it Make Sense and What are the Benefits?

By and Blog
When does it make sense to convert a Traditional IRA to a Roth IRA? Most of us are familiar with Traditional IRAs, where money is invested pretax and taxes are due when money is withdrawn. Traditional IRAs also require regular distributions (required minimum distributions or RMDs) in retirement. The newer Roth IRA was introduced just over 20 years ago (followed a little later by the Roth 401k) and allows retirement savers to put away money for retirement without a tax deduction on the contribution up front. Roth IRAs allow tax-free withdrawals and no requirement that RMDs be taken. This can…
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account beneficiaries

Naming Account Beneficiaries

By and Guides & Whitepapers
Don’t Overlook this Important Planning Opportunity Before she passed away, Jade was diligent in making sure her will was in order, which left her entire estate to be equally divided between her two sons, Samuel and Benjamin. However, instead of naming them joint account beneficiaries on her brokerage and bank accounts, she named Samuel as sole beneficiary on her large brokerage account and Benjamin as sole beneficiary on her modest savings account. When Jade passed away, nearly all her assets passed to Samuel and Benjamin outside of her will according to her beneficiary designations. However, Samuel received much more than…
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