Articles Posted in Uncategorized

OEpic-Blog-Image-3-300x133ne of the biggest problems that senior citizens ages 65 and older face is that they are frustrated by the fact that they have worked hard and sacrificed to save a nest egg for their later years only to face the possibility that they could lose everything to a long term care medical need, while others who spend and don’t worry about their finances can rely on government assistance to pay for all of their skilled nursing home costs

Sometimes older parents and grandparents even wake up in the middle of the night worrying about how much their children will struggle to have to provide care for their aging parents while the children watch the family finances go down the drain.

Continue reading

No, it does not. It transfers by beneficiary designation. Much like life insurance that goes to the individual named in the policy, the retirement plan goes to the individual named on the beneficiary designation in the plan document. If you don’t have a beneficiary designated or the individual that you designated is deceased, the account value can wind up in your probate estate; and if this happens, the only choice is that all the taxes are due right away, and there is significant inflexibility. But in general, it will avoid probate.
Continue reading

It’s one of the most emotional topics to deal with, yet the last thing you want to do is leave your family and loved ones scrambling to make sure they are legally and financially taken care of after you pass.

Just over 50% of Americans have a will set up. In many states, this means that when you die, your estate will be decided on by the courts. It could be heavily taxed and distributed among anyone that claims they have a stake to it or be awarded to one party that you may not want to have control of your financial affairs.

If planned appropriately, your estate could be a wonderful gift to leave your family. Even if you feel like you don’t have enough in assets to warrant a will, you should still consult an attorney. Most attorneys offer free consultations and you may find that by setting things up while you’re still here to oversee them, you may end up leaving more behind to your family than you imagined you could.

As you begin planning for retirement and doing general estate planning, do not overlook the importance of end of life health care planning.

With people living longer than ever before, the reality is that you may not be in a position to communicate what your wishes and desires are for health care as you near the end of your life. It’s important that these are set up ahead of time utilizing something like an advanced healthcare directive.

An advance health care directive is simply a written document that appoints another person to make health care decisions on your behalf when you are unable to. In many cases, this directive will spell out specific situations and how you want them handled, such as do not resuscitate orders.

IRA’s can be complex and confusing sometimes. There are so many rules and laws that must be followed to avoid penalties. One common area of confusion surrounds the required minimum distribution (RMD). The RMD is simply the minimum amount that an IRA holder must withdraw from their account once they hit the mandatory age to avoid being hit with penalties. This mandatory age varies from state to state but is typically age 70 ½ in most states.

When dealing with any aspects of your financial life, especially your IRA’s, it is always best to consult a financial planner that has experience in IRAs and tax laws.

Required minimum distributions seem to create the most questions when it comes to traditional IRAs. One of the most common questions pertains to taxes. Will the RMD be taxed? This depends on how your IRA is set up. If your IRA contributions are done pre-tax, then the answer to that is yes. You will pay taxes on the RMD. If you had your contributions taxed at the time of the contribution (which is not the typical scenario) you will not have your distribution taxed. Just remember that at some point taxes will have to be paid on this money. If you didn’t pay taxes when you made the contribution you will pay taxes at distribution.

Asset protection planning, no matter what anyone tells you, was never meant to be a tax avoidance tactic. Asset protection planning is a legal option for planning your wealth in advance of a claim or the threat of a claim.retirement trust

Asset protection planning is used to improve your bargaining position, make options available for settling claims, and avoid litigation – not to escape paying your taxes or debts or hiding your wealth from certain people.

And while there are some who insist asset protection planning is a form of cheating, this is only a perception because the truth is: There are some who try to use this option to cheat and lie, but it does not make it right and eventually they get caught.

Continue reading

1353627_tullips sxchu website.jpgIn Wisconsin and other states, probate is the legal procedure through which a person’s assets are transferred after their death. The process is supervised by a court of law and designed to protect anyone with a legal interest in the deceased person’s estate. Probate is used to distribute a decedent’s assets not only to beneficiaries, but also to creditors and taxing authorities. Continue reading

A Central Requirementold man

Health care has been the topic of discussion lately, but the greatest threat to your financial health is long-term care. This is the kind of care you need if you are not able to perform normal daily activities (such as eating, dressing, bathing and toileting) without help, and it is expected that you will need this help for an extended period of time, often for the rest of your life.

Long-term care is often needed due to aging, chronic illness or injury, and with people living longer, most of us will need it for at least some time before we die. But it is not just for the elderly—a good number of younger, working-age adults are currently receiving long-term care due to accident, illness or injury.

The Key Takeaways

  • The cost of long-term care is the greatest threat to your financial health.
  • Most of us will need long-term care for at least some time before we die.
  • It is better to assume you will need long-term care and plan for it than to just hope it doesn’t happen to you or a family member.

Continue reading

Social Security Traps That Cost You Money

Most people assume that Social Security will take care of them when they retire; however, some things that people do jeopardize the amount of their Social Security benefit because they do not fully understand all of the rules and regulations about Social Security. These Social Security traps can hurt you and your spouse’s financial well-being. Learning about Social Security traps and how to avoid those traps are the best way to ensure that you are fully prepared for your retirement.

Three Social Security Traps to Avoidfinance

Social Security Trap Number 1: Taking Money Too Early

It seems each year that the Social Security Administration raises the age for retirement. Currently, the age for full retirement benefits is 67; however, you can retire at age 62 but with penalties. If you retire at age 62, you only receive 70% of your Social Security benefits. This will last for five years until you reach the full age of retirement at 67. However, you receive several benefits if you wait until 67 to retire. First, if you wait until your full retirement age, your monthly benefit will be larger. Second, if you continue to work after the age of 62 and contribute to the Social Security fund, you will receive a higher monthly benefit than you would have received if you quit work at age 62. Third, the SSA calculates the cost of living adjustment (COLA) on the amount of your monthly benefit. If you decide to take your Social Security benefits at the age of 62, your COLA will be less than if you wait until 67 to begin receiving benefits.

Social Security Trap Number 2: Working Income

The Social Security Administration does permit individuals who are 62 years of age to begin receiving benefits while continuing to work; however, there is a penalty. If you decide to take your Social Security benefits beginning at age 62 while you are still working, your monthly benefit will be reduced. In 2015, the reduction rate is $1 for every $2 of earned income above $15,720. This reduction continues, based on your earnings from employment, until you reach the full age of retirement. The good news is that your benefits are not lost – they are simply deferred and credited to your account until you reach full retirement age.

Social Security Trap Number 3: Spousal Benefits

Continue reading