I'm guessing only planners may think like this but I have always been fascinated after a celebrity passing, what type of planning they may have done to protect their estate and pass their successes on to the next generation. Recently we lost Debbie Reynolds and her daughter Carrie Fisher in the same week and I couldn't help but take a peak at what their various estates looked like and what level of planning may have been accomplished.
Often, we have clients who are past age 70 1/2, who have started to take required minimum distributions and they simply don't want or need them. They don't want to pay taxes on monies that will simply go into their bank and in all likelihood, just sit there! Enter the qualified charitable distribution!
Interviewing financial advisors for this very vital role in your life can be daunting. Plus, the 21st century brings with it new threats to your finances, so your “toolbox” of questions needs to be updated as well. You are trying to achieve many objectives, such as help to plan for key life events and investing your hard earned assets in the most appropriate way. You not only need assistance in achieving your goals but you want to do so in a fashion that represents who you are. You also want peace of mind and time so you can go off and do the things that are most enjoyable to you, which encompasses the majority of your focus and attention.
Q: If I use the Roth backdoor technique when I'm less than 59 years old, do I have to pay a 10% penalty on the converted amount?
A: Great question! No, there is no penalty to convert as you aren't taking a distribution. To maximize the conversion, use outside assets to pay whatever tax may be due. If you take taxes from the traditional IRA, you may water down the effectiveness dramatically. It should be noted that if you withdraw funds from the converted Roth IRA within 5 years of the conversion, the 10% penalty will apply. There are no exceptions to this. Good luck!
Q: I just received a letter of reconsideration and my son was denied SSI. He has severe ADHD and is on medication.
A: Very sorry to hear families have to jump through so many hoops to get much needed help. Unfortunately, the reason why someone is denied is harder to ascertain. If this is your first attempt to get benefits, getting denied is very common. I would strongly suggest you appeal the decision immediately. You may also have to get an attorney to assist at some point. Often benefits will eventually be approved if cause is proven and justified and made retroactive so there is hope if you accept that this will be a longer process than anticipated. Here is more information that may help:http://www.disabilitysecrets.com/adhd-attention-deficit-social-security-disability.html
Good luck and don't give up!
Q: Can I receive my deceased mother's pension?
My mother just passed away at age 69. She was supposed to receive her pension starting at age 70 1/2. The company says it is only allowed to go to a surviving spouse (which there is none) and that I have no claim to her pension. That's not what my mother understood. Days before she passed away, she mentioned to her best friend that should anything happen to her, to make sure I got her pension.
A: First very sorry for your loss. I will try to offer some helpful information but without knowing the whole story, it is difficult to surmise what may have happened here. If this is a true defined benefit pension plan, every company will have their own rules for how it pays out funds. I would first suggest getting a copy of the company’s retiree benefit package to review their policies and procedures.
Provided by Roy Larsen, CFP®, AAMS®
These are the words that make investors irrational:
"This time is different"
By Roy Larsen, CFP®, AAMS®
What if’s are very rarely top of mind for most of us but with a little knowledge, time and most importantly execution, peace of mind for a possible incapacitation can be quickly addressed. In this article I hope to address the basic differences in Power of Attorneys’ and when this simple document simply isn’t enough. Lastly, what powers do you have if something happens to your adult children and grandchildren?
Did that last one get you thinking? Let’s start there:
By Roy Larsen, CFP®, AAMS®
We have all gotten them in the mail. They arrive as slick, colorful, glossy and in depth reports on a ground floor investment, still trading at pennies for the next great technology. They have fancy insider names to them like “Wall Street Insider” or “The Underground Stock Report”. They often link the promoted stock to legitimate companies or common sense needs around the globe. The problem is although it always sounds promising, you are gently being stroked and entranced into participating in what is known as the “pump and dump.”
In 1995, the Social Security Administration (SSA) began mailing out annual Social Security Statements to everyone age 25 and older. These statements were designed to help Americans plan for the future by providing a detailed record of their earnings and estimates of Social Security benefits. Last year, the SSA suspended mailing these statements because of budgetary concerns, but in March 2012, the SSA resumed mailing annual statements to workers age 60 and older. If you're age 60 or older, you should receive your statement every year, about three months before your birthday. The SSA is also resuming the mailing of one-time statements to workers who are age 25 to introduce them to Social Security programs and benefits.
Roy Larsen is a Certified Financial Planner™ practitioner and Fee Only Wealth Manager who resides outside of Atlanta, Georgia.
Roy's Financial Blog contains articles on multiple financial life events as well as his favorite questions from he receives from around the country as a an expert panel member for Investopedia's Advisor Insights.