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All posts in Retirement Planning

tax deferredOne of the main reasons why retirement accounts are so beneficial is the power of tax deferral. In a tax-deferred investment vehicle, such as a 401(k) plan or an IRA, your earnings are not taxed until you begin withdrawing money from your account in retirement. Consider the image. A hypothetical value of $10,000 is invested in both a taxable and a tax-deferred account. The difference in value between the two accounts becomes quite substantial after 20+ years. For investors with a long investment horizon, a tax-deferred portfolio is an excellent choice.

Please keep in mind that once you begin to withdraw money from your retirement account, you will be taxed accordingly. However, since you will most likely earn less in retirement, withdrawals from a deferred portfolio may be taxed at a lower rate.


Financial professionals worry about the amount that Americans spend on their adult children during years when they should be concentrating on saving for their own retirement.  Most people do not expense for taking care of their adult children.  It is important for clients to understand that money that is flowing out at this point will reduce their retirement.

In a study of 1,006 affluent baby boomers, conducted in December, found that 93% have provided some level of support to their adult children.  This is not just because of the current economic conditions either.  A similar study done in 2007 found that 92% provided support for adult children.  Because this money is generally taken from discretionary cash flow, parents are not linking this to reducing their retirement.  The study also found that only 24% of the responding boomers are putting away money for the future.


Do you miss receiving your social security benefits statement?  If you recall, the Social Security Administration used to mail annual statements to you, but suspended this service back in 2011.  Last month, the SSA announced that workers age 18 and older can now access their Social Security Benefit statements online.  “Our new online Social Security statement is simple, easy-to-use, and provides people with estimates they can use to plan for their retirement,” says Michael Astrue, Commissioner of Social Security.  This is a terrific financial planning tool because you can also view estimates for disability and survivor benefits. 

To access the site, you will need to register at http://ssa.gov/mystatement/.  You will be asked to create a unique user name and password as well as correctly verify personal information during this registration process.  They have also added an additional security measure in offering you the ability to set up text-message alerts for each time someone logs into your account.

It is our recommendation that you take the time to register and login to the website.  This information needs to be monitored to ensure accurate information from your employer is being submitted.  It is also important to check this information to be sure that no one else has used your Social Security Number.  Rest assured that this site is strictly informational so if someone did gain access to your account they could not make changes to your benefits.


 A fresh new year is a great time to up your contributions to a retirement plan.  Some limitations have changed for 2012 and it is important for everyone that wants to do the maximum contributions to up their contributions in order to do just that.  Contact us today if you have any questions on your limits or your current retirement plan options.

  • 401(k), 403 (b), most 457 plans and the federal government’s Thrift Savings Plan have increased to $17,000 from $16,500
  • Catch-up contributions for those aged 50 and over for the above mentioned plans remains at $5,500
  • Simple IRA Plan contribution limit remains at $11,500 and the catch-up contribution limit for Simple IRA Plans remain at $2,500
  • The deduction for taxpayers making contributions to a traditional IRA is phased out for singles and heads of household who are covered by a workplace retirement plan and have modified adjusted gross incomes (AGI) between $58,000 and $68,000, up from $56,000 and $66,000 in 2011.  For married couples filing jointly, in which the spouse who makes the IRA contribution is covered by a workplace retirement plan, the income phase-out range is $92,000 to $112,000, up from $90,000 to $110,000.  For an IRA contributor who is not covered by a workplace retirement plan and is married to someone who is covered, the deduction is phased out if the couple’s income is between $173,000 and $183,000, up from $169,000 and $179,000.
  • The AGI phase-out range for taxpayers making contributions to a Roth IRA is $173,000 to $183,000 for married couples filing jointly, up from $169,000 to $179,000 in 2011.  For singles and heads of household, the income phase-out range is $110,000 to $125,000, up from $107,000 to $122,000.  For a married individual filing a separate return who is covered by a retirement plan at work, the phase-out range remains $0 to $10,000.

For complete information,click here to go to irs.gov


Utilizing this benefit offered by your employer is an essential key to saving for retirement.  This money is withheld pre-tax from your paycheck, which will lower your taxable income for that year (or post-tax if participating with a Roth 401(k)).  This money will grow tax-free until it is time for you to retire.  Many employers contribute to these plans with matching and/or profit sharing.  It is very important to understand your employer’s retirement plan so you are maximizing your contributions to get the maximum amount of match/profit sharing from your employer.

Contact us today if you need assistance determining the best plan for contributing to your employer’s retirement plan.


September 9th is National 401(k) Day!  This day is an annual celebration to promote the importance of participation in employer-sponsored profit sharing and 401(k) plans.  Ignoring these plans should  not be an option!  Do you stop for a coffee everyday?  Put that money towards your retirement instead!  Would you like to reduce your income taxes?  Participate in the retirement plan and do just that as the contributions are deducted before your taxes are calculated (except for Social Security taxes).  Does your employer offer a match?  If the answer is yes, realize you are throwing free money away by not  participating!  Do you have an old 401(k) from a previous employer?  Most employers allow you to roll your 401(k) balance into their plan and if they do not, you can open an IRA to capture those assets. 

Contact us today to discuss these options or for any assistance you may need!!


Even before the onset of the worst financial crisis since the Great Depression, many people wondered whether they were saving enough for retirement. Frankly, many weren’t. Now, post-meltdown, the question remains: Am I saving enough? Take the Kiplinger quiz to see if you are on track for a comfortable retirement and if not, how you can improve your chances.

Click here for the quiz!



Worried about Social Security and Medicare cuts?  So are thousands of people.  With our current economy and a climbing deficit, it leaves us wondering just how long these programs will last as is before going dry.  It also has many people taking Social Security at age 62 instead of waiting until 66 (which will give them an 8% boost in their check). 

An article by William Barrett in Forbes Magazine gives you a complete picture of what is happening.  Click here to read on…


If you have recently changed jobs, it is a good idea to take a look at your qualified retirement plan with your former employer.  Rolling this over into your own individual retirement account will give you more control and choice over investments while continuing to defer taxes. 

An article by Bill Bischoff discusses a few things to consider when wanting a tax-free IRA rollover.  Click here to read entire article.