Monthly Market Review & Outlook

12 Things to Tell Your Kids About Your Money

You don’t have to tell them some things, but others are very important You’ve probably taught your kids a whole bunch about money over the years, like how to stretch an allowance through an entire week and how to balance a debit account — or, most challenging of all,...

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“MID-AIR” ROTH CONVERSIONS

By Andy Ives, CFP®, AIF® IRA Analyst Follow Us on X: @theslottreport If ever I was traveling from Los Angeles to Atlanta, I would choose a direct flight with no layovers. I want the most efficient route to my destination. Point A to Point B. Take off, land. Assuming...

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MORE ON THE ROTH CATCH-UP CONTRIBUTIONS DELAY

By Ian Berger, JD IRA Analyst Follow Us on X: @theslottreport The August 28, 2023 Slott Report summarized IRS Notice 2023-62, where the IRS delayed the effective date of the SECURE 2.0 rule requiring catch-up contributions by higher-paid older employees to be made on...

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Weekly Market Commentary

-Darren Leavitt, CFA The holiday-shortened week ended with losses for both US equities and Treasuries.  Apple shares tumbled on the news that the Chinese government would ban the use of the iPhone at government agencies at all levels of government.  The news comes in...

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7 Things to Know About Appointing an Executor

And 7 ways to make things easier for yours Have you found an executor (also known as a personal representative) to handle your affairs should you become incapacitated or die? Planning for death-related events isn’t fun, so you may be procrastinating. Or you may be...

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IRA BENEFICIARY PAYOUT RULES – THE MADNESS CONTINUES

By Andy Ives, CFP®, AIF® IRA Analyst Follow Us on X: @theslottreport   The lunacy of IRA beneficiary payout rules continues to boggle the mind. As I guide advisors through the options available to their clients, various nuances present one unique scenario after...

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7 Money Leaks — and How to Plug Them

These stealthy cash drainers could be costing you big bucks Yes, you can save a lot by cutting out the little pleasures in life. Nonessentials like caffe lattes and premium channels can really add up. But life is too short for mediocre coffee! The good news is that...

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Weekly Market Commentary

Weekly Market Commentary - 8/25/2023 -Darren Leavitt, CFA Financial markets were all over the place last week and ended with mixed results. The S&P 500 gained 0.8% and closed above 4400, a critical psychological level, but fell short of regaining the 50-day moving...

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Why Gen X Is Freaking Out About Retirement

Facing an insecure financial future, America's 'neglected middle child' may have to chart a different path to post-work life For years, Mike Cundall Jr. thought he was on the proper path to retirement. A professor of philosophy at North Carolina A&T University,...

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3-YEAR STATUTE OF LIMITATIONS – MISSED RMDS

By Andy Ives, CFP®, AIF® IRA Analyst Follow Us on X: @theslottreport When an IRA or retirement plan owner reaches a particular age, that account owner typically must begin taking required minimum distributions (RMDs.) The RMD is calculated based on the year-end...

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Weekly Market Commentary

Weekly Market Commentary - 8/18/2023 -Darren Leavitt, CFA US equity markets fell for the third consecutive week.  The S&P 500 broke its 50-day moving average and then sank below 4400.  The sell-off has been on low volume, and the market may have been due to some...

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5 Retirement Fears Keeping Us Up at Night

Inflation, stock swings and more erode Americans’ confidence in future financial security When it comes to retirement readiness, many Americans are feeling disillusioned. A spring Gallup poll found that only 43 percent of nonretired adults expect to live out their...

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RMD RELIEF? NO THANK YOU!

By Sarah Brenner, JD Director of Retirement Education Follow Us on X: @theslottreport The IRS unleashed massive confusion last year. To the surprise of many, it released proposed SECURE Act regulations requiring beneficiaries (on some occasions) to take required...

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Weekly Market Commentary

-Darren Leavitt, CFA US Financial markets had another week of consolidation.  Equities and US Treasuries sold off in tandem on light volume.  An early week debt downgrade of 10 small to midsized banks and a notice that other downgrades may follow by Moody’s dampened...

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8 Ways to Recover Faster From a Disaster

A little planning can ease the financial hardship You may not think a disaster can hit you, but a disaster of some sort can occur just about any place, at any time, with little or no warning. Garrett Sorensen knows that. His car was totaled when a powerful tornado hit...

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ANOMALIES AND EXCEPTIONS

By Andy Ives, CFP®, AIF® IRA Analyst Follow Us on X: @theslottreport As already-complicated IRA rules spiral further into an abyss of confusion, it comes as no surprise that irregularities exist. Up is down and left is right. Green means stop, red means throw your...

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Weekly Market Commentary

Weekly Market Commentary - 8/4/2023 -Darren Leavitt, CFA Global equity markets fell last week as investors digested a full dose of Q2 earnings reports, a packed economic calendar, more central bank policy decisions, and Fitch's surprise downgrade of US sovereign debt....

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INHERITED IRAS AND RMDS: TODAY’S SLOTT REPORT MAILBAG

By Andy Ives, CFP®, AIF® IRA Analyst Follow Us on Twitter: @theslottreport Question: Greetings, If I have the beneficiaries on my IRA listed as my wife (50%) and two children over 21 (50%), is my wife still able to move her half of the IRA into her existing IRA when I...

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10 Biggest Expenses in Retirement

You may think that your big expenses in retirement will be for greens fees at golf clubs, spa charges at that resort in Crete, and taking the kids out for avocado toast on weekends. And that may well be true. But some of your biggest expenses may surprise you —...

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Weekly Market Commentary

Weekly Market Commentary - 7/28/2023 -Darren Leavitt, CFA It was a busy week on Wall Street with announcements of monetary policy decisions from the Federal Reserve, European Central Bank, and the Bank of Japan, along with an active calendar of Q2 earnings...

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HELP A YOUNG PERSON USE SUMMER EARNINGS TO START A ROTH IRA

By Sarah Brenner, JD Director of Retirement Education Follow Us on Twitter: @theslottreport Is your child or grandchild working hard this summer? A summer job can be a valuable experience for a young person. Whether it is making smoothies, serving tables, or being a...

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5 Retirement Savings Changes Coming in 2024

The Secure 2.0 Act of 2022 has several provisions that could significantly impact your retirement savings, and some of the most important ones are set to take effect in 2024. The legislation was designed to make it easier to save for retirement, streamline retirement...

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Q&AS ON RECENT IRS RMD RELIEF

By Ian Berger, JD IRA Analyst Follow Us on Twitter: @theslottreport On July 17, we reported that the IRS had issued required minimum distribution (RMD) relief in two situations. First, the Service excused 2023 RMDs for certain IRA (and plan) beneficiaries subject to...

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Weekly Market Commentary

Weekly Market Commentary - 7/21/2023 -Darren Leavitt, CFA US financial markets were mixed last week as investors continued to dissect 2nd quarter earnings results and economic data. The notion of a soft landing in the economy resonated with investors even as global...

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TRUST AS IRA BENEFICIARY – A POTENTIALLY CATASTROPHIC PROBLEM

By Andy Ives, CFP®, AIF® IRA Analyst Follow Us on Twitter: @theslottreport We say in our training manuals that “the SECURE Act obliterates IRA trust planning.” That’s an aggressive word – “obliterates” – but it is accurate. We also shout from the mountain top that...

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Weekly Market Commentary

Weekly Market Commentary - 7/14/2023 -Darren Leavitt, CFA US markets rallied on the notion that the economy may be able to execute a soft landing as inflation wanes and employment continues to hold up.  Inflation data reported during the week showed moderating prices...

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4 Retirement Planning Tips for 2023

Are you prepared for retirement? With longer life expectancy, rising healthcare costs, and the possibility of Social Security insolvency the pressure to prepare is mounting. To help you navigate the process, here’s an overview of the key factors you should consider...

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5 WAYS EXCESS IRA CONTRIBUTIONS HAPPEN

By Sarah Brenner, JD Director of Retirement Education Follow Us on Twitter: @theslottreport   You can have too much of a good thing. While it is a good strategy to contribute to an IRA, some contributions are not allowed. When a contribution is not permitted in...

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Weekly Market Commentary

Weekly Market Commentary - 7/7/2023 -Darren Leavitt, CFA The holiday-shortened week was discombobulated, to say the least. Trading desks on Wall Street were lightly staffed despite a full economic data calendar.   The start of the third quarter ushered in equity and...

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5 Retirement Planning Steps to Take

These five steps will help you toward a safe, secure, and fun retirement Retirement planning is a multistep process that evolves over time. To have a comfortable, secure—and fun—retirement, you need to build the financial cushion that will fund it all. The fun part is...

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WHY YOU SHOULD NOT ROLL OVER YOUR COMPANY FUNDS TO AN IRA

By Ian Berger, JD IRA Analyst Follow Us on Twitter: @theslottreport In her June 28, 2023 Slott Report post, Sarah Brenner discussed several reasons why it pays to roll over your retirement plan savings to an IRA. Another option is to keep your funds in the plan. Keep...

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Weekly Market Commentary

Weekly Market Commentary - 6/30/2023 -Darren Leavitt, CFA Markets ended the month of June in strong form. Better-than-expected economic data for the week showed a resilient economy and inflation moderating. Investors were dismissive of hawkish commentary from ECB...

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WHY YOU SHOULD ROLL OVER YOUR RETIREMENT FUNDS TO AN IRA

By Sarah Brenner, JD Director of Retirement Education Follow Us on Twitter: @theslottreport If you are like most American workers, you will change jobs many times during your lifetime. With a job change, you will have a decision to make. What should you do with the...

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DEATH OF AN IRA BENEFICIARY – BEFORE CLAIMING THE ACCOUNT

By Andy Ives, CFP®, AIF® IRA Analyst Follow Us on Twitter: @theslottreport   When an IRA owner dies, we look to the beneficiary form to determine who should receive the IRA funds. After death, there is a transition process as assets are moved into an inherited...

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Taxation of Retirement Income

When you retire, you leave behind many things—the daily grind, commuting, maybe your old home—but one thing you keep is a tax bill. In fact, income taxes can be your single largest expense in retirement. Taxation of Social Security Benefits Many older Americans are...

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Weekly Market Commentary

-Darren Leavitt, CFA US equity markets tapped on the brakes with modest losses across the board.  The notion that higher rates will further dampen global economic growth gave investors reason to take some profits.  Economic data painted a resilient economy but...

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6 Things to Do If You’re Nearing Retirement

Planning to retire in 10 years or less? Find out what you need to know and do for a smoother transition. If you're thinking of retiring within the next 10 years, you may feel like you're confronting quite a few "what ifs" and unknowns. "Many retirees say transitioning...

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THE TWO TYPES OF 457(B) PLANS

By Ian Berger, JD IRA Analyst Follow Us on Twitter: @theslottreport Some of you are aware that there are two types of section 457(b) retirement plans – governmental plans for state and local municipal workers, and “top hat” plans for highly-paid and managerial...

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Weekly Market Commentary

Weekly Market Commentary - 6/16/2023 -Darren Leavitt, CFA US equity markets continued to impress with another set of weekly gains. The mega-cap issues retook the lead, while small-cap issues lagged. Global central bank policy was top of mind for investors who received...

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NUA AND SILVER IN YOUR IRA: TODAY’S SLOTT REPORT MAILBAG

By Andy Ives, CFP®, AIF® IRA Analyst Follow Us on Twitter: @theslottreport   Question: I have a large amount of stock from a previous employer in my 401(k).  I had been reinvesting the dividends for the last 23 years since I left the company.  I no longer want to...

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IF THE IRS ASK QUESTIONS, CAN YOUR ACTIONS BE JUSTIFIED?

By Andy Ives, CFP®, AIF® IRA Analyst Follow Us on Twitter: @theslottreport A couple of years ago I was asked what the tax consequences are when a Roth IRA is split in divorce. After a pause, I answered honestly: “I have no idea…but will find out.” In fact, there is no...

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FIVE QDRO Q&AS

By Ian Berger, JD IRA Analyst Follow Us on Twitter: @theslottreport Although the U.S. divorce rate is in a steady decline, it’s still one of the highest in the world. And with divorces often come QDROs – “qualified domestic relations orders.” A QDRO is a state court...

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Weekly Market Commentary

Weekly Market Commentary - 6/9/2023 -Darren Leavitt, CFA The S&P 500 entered a new bull market, increasing 20% off the October lows. The move came with broader participation outside the mega-cap technology issues, responsible for most of the market’s performance...

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SPOUSAL ROLLOVERS

By Sarah Brenner, JD Director of Retirement Education Follow Us on Twitter: @theslottreport Probably the biggest advantage that a spouse beneficiary of an IRA has over other beneficiaries is the ability to do a spousal rollover. Only a spouse beneficiary can do a...

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What Is the Ideal Retirement Age for Your Health?

Average life expectancy has risen by 16 years since the national retirement age was set at 65. We asked health experts when they think people should stop working now. In 1881, the conservative German Chancellor Otto von Bismarck, plagued by a rise in socialist...

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ALAR – THE “AT LEAST AS RAPIDLY” RULE

By Andy Ives, CFP®, AIF® IRA Analyst Follow Us on Twitter: @theslottreport For deaths in 2020 or later, we know that a non-eligible designated beneficiary (NEDB) of an IRA is subject to the 10-year rule. Meaning, the account must be emptied by the end of the tenth...

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Weekly Market Commentary

Weekly Market Commentary - 6/2/2023 -Darren Leavitt, CFA Investors enjoyed an excellent week of gains in US equity markets. Washington finally got a debt ceiling deal through Congress and onto President Biden’s desk. On the margin, it appears that the Republicans came...

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IRS DELAYS EFFECTIVE DATE OF IRA SELF-CORRECTION PROGRAM

By Ian Berger, JD IRA Analyst Follow Us on Twitter: @theslottreport It looks like IRA owners will probably have to wait awhile to take advantage of a new program that allows them to self-correct IRA errors that previously couldn’t be fixed. In Notice 2023-43, the IRS...

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Weekly Market Commentary

Weekly Market Commentary - 5/26/2023 -Darren Leavitt, CFA As investors awaited news from the debt ceiling negotiations, markets continued to ebb and flow.  The S&P 500 continued to trade range-bound, oscillating between 4100 and 4200.  Fed rhetoric continued to...

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Why is insurance important in financial planning?

Key takeaways Like a good financial plan, insurance takes into account your goals and current financial situation and should evolve as your life changes. In addition to income replacement, life insurance, in particular, can help diversify your portfolio, protect...

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POISON IVY: IRA SCENARIOS TO AVOID

By Andy Ives, CFP®, AIF® IRA Analyst Follow Us on Twitter: @theslottreport I got into some poison ivy and am suffering the consequences. It takes a few days for the welts to appear, but they are in full bloom. While I did take precautions before starting my yardwork...

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Weekly Market Commentary

Weekly Market Commentary - 5/19/2023 -Darren Leavitt, CFA Investors were treated to a week of gains for US indices, while US Treasuries fell significantly across the curve. Early in the week, there was cautious optimism around debt ceiling negotiations as both sides...

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Are Annuities Taxable? A Guide to How Annuities are Taxed

Annuities offer powerful tax benefits to those planning for, or entering retirement. Unlike money market accounts, savings accounts, certificate of deposit (CDs), and most bonds, annuities carry the potential to create tax-deferred accumulation. For example, interest...

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HSA BENEFITS THAT MAY SURPRISE YOU

By Sarah Brenner, JD Director of Retirement Education Follow Us on Twitter: @theslottreport   You have likely heard of Health Savings Accounts (HSAs), and you may even understand the basics of how an HSA works. These accounts are really not too complicated. If...

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INHERITED ROTH IRA: RMDS OR NO?

By Andy Ives, CFP®, AIF® IRA Analyst Follow Us on Twitter: @theslottreport QUESTION: Do required minimum distributions (RMDs) apply to inherited Roth IRAs? ANSWER: It depends on who the beneficiary is. Owners of traditional IRAs must start taking RMDs when they reach...

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Weekly Market Commentary

Weekly Market Commentary - 5/12/2023 -Darren Leavitt, CFA US equity and fixed-income markets continued to trade in a tight range. 4100 proved to be support for the S&P 500, while the US 10-year note yield oscillated around 3.46%. Cyclical issues were under...

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What Is Good About Fixed Indexed Annuities?

Fixed indexed annuities (FIAs) have grown in popularity over the years, primarily due to their unique combination of safety, growth potential, and guaranteed income streams. In this people-first guide, we’ll explore the benefits of fixed-indexed annuities, how they...

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MANDATORY ROTH CATCH-UP CONTRIBUTIONS REQUIRED FOR 2024

By Ian Berger, JD IRA Analyst Follow Us on Twitter: @theslottreport   One of the more controversial provisions of the new SECURE 2.0 law concerns 401(k) catch-up contributions. Most 401(k) plans – as well as 403(b) and governmental 457(b) plans – permit employees...

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Weekly Market Commentary

Weekly Market Commentary - 5/5/2023 -Darren Leavitt, CFA Investors were treated with an extremely busy start to May. Central bank decisions on monetary policies and more first-quarter earnings were front and center, while there was a full slate of economic data to...

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CONVERSION AS A GIFT TO YOUR BENEFICIARIES

By Sarah Brenner, JD Director of Retirement Education Follow Us on Twitter: @theslottreport Do you have an IRA you are thinking about converting to a Roth IRA? There are many benefits to converting. You trade an immediate tax bill for the promise of tax-free earnings...

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HOW THE RETIREMENT PLAN COMPENSATION LIMIT WORKS

By Ian Berger, JD IRA Analyst Follow Us on Twitter: @theslottreport It’s certainly not a bad problem to have. But employees with very high compensation cannot have their retirement plan benefits based on all of their pay. Instead, the tax code allows only compensation...

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Weekly Market Commentary

Weekly Market Commentary - 4/28/2023 -Darren Leavitt, CFA Markets ended the month of April with slight gains for the large-cap indices and small losses for the small-caps. Q1 earnings continued to be in focus as some of the most influential companies posted mixed...

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What Is the Ideal Retirement Age for Your Health?

Average life expectancy has risen by 16 years since the national retirement age was set at 65. We asked health experts when they think people should stop working now. In 1881, the conservative German Chancellor Otto von Bismarck, plagued by a rise in socialist...

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THE 5-YEAR RULE FOR CONVERTED ROTH IRA FUNDS

By Sarah Brenner, JD Director of Retirement Education If you recently converted your traditional IRA to a Roth IRA and you under 59 ½, you will want to know about the five-year rule for penalty-free distributions of converted funds from your Roth IRA. Many people are...

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5 REASONS WHY YOU SHOULD NOT OPEN A ROTH IRA

By Andy Ives, CFP®, AIF® IRA Analyst Follow Us on Twitter: @theslottreport In my April 12 Slott Report entry (“5 Reasons to Open a Roth IRA Immediately!”), I included a handful of points as to why it was imperative to open a Roth IRA, especially before the tax filing...

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Weekly Market Commentary

Weekly Market Commentary - 4/21/2023 -Darren Leavitt, CFA US equities traded sideways throughout the week as investors contemplated Q1 earnings reports, more Fed rhetoric, and weakening economic data. International markets were also off for the week, with Chinese...

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