Episode Transcript
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Speaker 1 (00:03):
Live from the wgy iHeart Studios. Welcome to Retirement Ready
with your host Dave Kopek from the Retirement Planning Group.
Every week, Dave and his team discuss the ways they
can help people make informed decisions about their retirement assets
to maintain, improve, and secure their desired quality of life.
Here's your host, Dave Copet.
Speaker 2 (00:40):
All right, Capital District five point eight, Outside the Boundaries,
Retirement Ready topic specific. We are live in the studios
today with my number one man, Zach Engineer.
Speaker 3 (01:02):
I'm gonna let your son know that.
Speaker 4 (01:05):
Sports enthusiast.
Speaker 2 (01:08):
This morning we talked a little bit about what's going
on with the NIL, so we'll talk about anything, but
I am not a fan of NIL. I think it's
destroying college sports. Just so everybody knows, you got kids
making eight nine, ten million dollars at age eighteen. Not
(01:31):
a good recipe in my opinion. That's all I'm gonna say.
That's my story and I'm sticking to it. So hopefully
you're out there enjoying the UH. I guess you could
say this is Upstate New York weather for this time
of year, crappy, overcast, raining, chili cold. To all of
(01:55):
our friends, in Florida and surrounding areas out side the
five and eight. Hopefully your day is a little bit
better than ours, because it does not look it's getting
like it's getting any better, is it, weather Man?
Speaker 3 (02:10):
Now it's not looking too good this weekend.
Speaker 2 (02:12):
Now next year, I'm not going to Florida for January
and February. I'm going to Florida for January, February of March.
Ain't coming back. I will come back for specific days,
but I will get my back on the seat of
(02:33):
the Jet Blue airline and arrive in two hours and
forty five minutes to Fort Lauderdale. So if you got
any questions or comments, were lived, talk WGY. That's one
eight hundred eight two five fifty nine forty nine. Today
we're going to talk a little bit about the problematic
(02:54):
money IRA money. We're going to talk about rm ds.
You got a time frame here. If you did not
take your money out of your IRA in the year
twenty twenty four and you were mandated to take it out,
then you got a couple of days in order to
get the money out the door of you're going to
(03:15):
suffer a penalty. So bottom line is this, this is
talk radio, not Babbel Radio. So if you have a
question or comment, love to have you participate. As I said,
this is talk radio, not Babbel radio, So if you
have a question or a comment, it always makes it
(03:36):
a little bit more interesting, I believe to listen to
the show. So here we go. Ready, r and ds
Required minimum distributions. There's some key decisions that loom for
(03:59):
people that earn the age of seventy three. Now that
seventy and a half. So if you turned age seventy
three in the year two thousand and twenty four, you
were required to take required minimum distribution from your pre
tax accounts, your IRA four h three, B four oh one, k,
(04:22):
et cetera. If you didn't guess what, you got a
safe haven here until April first.
Speaker 4 (04:32):
So what does that mean.
Speaker 2 (04:33):
That means that it's the only time that it's allowed
that you have the ability to satisfy the rm D
the first year at age seventy three, and you have
until April first in order to facilitate that RMD that
you were supposed to take in the year two thousand
and twenty four. If you don't, you don't take it,
(04:59):
you're gonna get hit with some major penalties, and they
will bing gin accruing, which you don't want because the
IRS has a tendency not to be warm and fuzzy
about this. So so if you turn seventy three last year,
(05:19):
you can postpone your distribution until April first of the
following year, but every year after it must be taken
within the calendar year. Got that capeche. So if you
postponed last year's distribution to April first, you're gonna have
(05:41):
to take both of your two thy and twenty four
and twenty five rm ds by the end of this
year December thirty first of two thousand and twenty five.
There's no exception. There's no exception. So if you're still
working and own more than five percent of a business
(06:03):
sponsoring your plan, then there is But this is one
of the reasons which I talked about this warning. If
you are continuing to work, now, let's just say that
mister or miss Wonderful got a hold of you and said,
(06:23):
now you got to roll your money into a self
directed IRA because you retired from XYZ Corporation. And it's
a lot of money, a lot of dora me hundreds
of thousands of dollars and not seven figures. You do
have an option, I did it myself. What is that
(06:45):
you can roll that money into your current four to
oh one K plan as long as you are considered
to be fully employed. That means that you do not
have to take R and D any longer because you
no longer have that keyword IRA and because you are
(07:11):
still employed and the money's in a four to oh
one K, there's no required minimum distribution to you do
what stop working? Stop working? So you can hold off
the rm ds and you can adjust your rm DS
with a couple of other options I'll discuss today.
Speaker 4 (07:34):
But no matter what.
Speaker 2 (07:35):
Your age that you're at, there are strategies to utilize.
But there are trillions, folks of dollars in qualified assets
trillions with a T not B or an m T
trillions estimate it somewhere to be around forty trillion dollars
(07:58):
of assets that are held in qualify five plans as
of the end of twenty and twenty four. So if
that is the case, good guess what our friends in
Washington are looking for you to turn the spickt on
because they want what the money, they want, the taxes,
(08:19):
they want, the denaros the doray me. So when you
calculate your rm D by dividing your account value by
December thirty first of the prior year, there's a uniform
lifetimetable and that will tell you that's how much money
you have to take out. So if your IRA assets
(08:40):
were value that let's say three hundred thousand dollars December
thirty first to last year, and you would be that
magical age now seventy five at year in your life
expectancy is twenty four point six, and your RMD for
your two thousand and twenty five will be twelve thousand,
(09:02):
one hundred and ninety five dollars. Whether you want it
or not. Whether you want it or not, the money's
coming out the door because IRS says you've had all
these years of accumulation on a tax deferred basis. Now
you don't have to have that happen if you are
(09:24):
still employed and you have access to a four oh
one K program, because most of those four oh one
K programs will allow you to roll your IRA assets
into your existing four oh one K and you're not
going to have a tax liability of twelve one ninety
five dollars why am I saying that?
Speaker 4 (09:45):
Look at Baron's This Week. Barons this Week has an.
Speaker 2 (09:49):
Article of how much longer people are expected to live
and guess what. People that are the boomer are expected
to work longer. Not necessarily because they're high fiving and
jumping up and down, but they want to stay relevant.
(10:10):
They want to basically have a purpose in their life.
They want to get up in the morning and instead
of worrying about what am I gonna have for breakfast?
Am I taking my walk? Is the pickup ball day?
What are we doing? They have a purpose, They get
up and they basically have a job that they love.
(10:32):
A lot of people actually leave what they did for
thirty or forty years and now they have a job
of purpose, passion, something that they always wanted to do.
So we're going to talk a lot about rm d's
IRA distribution planning today. I'm live in the studio. We
always welcome phone calls. Zach don't like to have him
(10:56):
sit back in his chair and fall asleep. So our
telephone number here is one eight hundred talk WGY. That's
one eight hundred eight two five fifty nine forty nine.
Love to have questions always makes it more interesting. This
is not babble radio. This is talk radio. So if
you have questions or comments, even if it's off topic,
that's fine. One eight hundred Talk WGY one eight hundred
(11:21):
eight two five fifty nine forty nine. I'm Dave Kopec,
President of the Retirement Planning Group. I'll be right back
the eighty six percenters. Do you know that eighty six
percent of the population has no defined benefit pension plan.
For most of us, we have to take our life
savings and create a paycheck for the rest of our
lives in retirement. What is your plan for retirement income distribution?
How will you manage your assets during the most critical years.
Speaker 4 (11:43):
Of your lifetime.
Speaker 2 (11:44):
Nobel Prize winning economist William Sharp has called retirement income
distribution the nastiest, hardest problem in finance. He points out
that investment, uncertainty, and mortality can derail the most careful
laid out retirement income plan. Call our offices TOAD to
start the process of building your retirement income distribution plan.
After forty one years of being in the financial services business,
(12:06):
you need to start taking action to start building your
own personal retirement income distribution plan.
Speaker 4 (12:12):
How do you do that?
Speaker 2 (12:13):
To take action five one eight, five eight zero one
nine nine. That's five one eight, five eight zero one
nine one nine or RPG retire on the web. Don't procrastinate,
motivate to start building your retirement income distribution plan five
win eight five eight zero one nine one nine. The
greatest risk in retirement most of us have no plan
for We're insurance to cover the expense A long term
(12:35):
care event can impoverish a spouse, drain your life savings,
and cost stress and anxiety on your family. What is
your plan and how will you pay for a long
term caravent? Call the Retirement Planning Group today. Discuss options
you should consider to protect your estate and have choices
and independence. Take action call today five one eight, five
eight zero one nine one nine or RPG retire on
(12:58):
the web.
Speaker 4 (13:26):
Waiting for the spring sas for something to say, all right,
we are back Chicago, Well Chicago there. Did you ever
see them in concerts?
Speaker 2 (13:48):
I can't say I have no. They're excellent, unbelievable in concert.
Got those horns are blowing. I don't know if they
still wid. I saw him in concert years ago, that
years ago, many months ago.
Speaker 4 (14:03):
How's that.
Speaker 2 (14:06):
It was?
Speaker 4 (14:06):
Well? Worth the trip new concert guy.
Speaker 3 (14:10):
I used to be not so much anymore. Me I'm
too old and you can't leave your house without spending.
Speaker 2 (14:20):
But you'll spend five hundred dollars for a Philadelphia Eagle ticket.
Speaker 4 (14:24):
Oh that's different.
Speaker 3 (14:26):
Hey, they only won two Super Bowls in fifty nine years.
They'll leave me be.
Speaker 2 (14:33):
My son's coming in. We're gonna have a chat. We
got a show that we do in Syracuse after this
one live. He calls me the trader. I was a
New York Giant fan for years, but after last year,
I said that's it no more. I'm out. Now I'm
a Buffalo Bill fan. Go Bills. All right, we're talking
(14:59):
about that mad time of year. April first. Everybody thinks
about taxes April fifteenth. But beware, if you did not
take your required minimum distributions to satisfy RMD in the
year twenty twenty four. If you have multiple IRA accounts,
(15:21):
you must calculate the R and D for each one,
aggregated together, divide by the uniform lifetimetable. You can take
the distribution from one account. You don't have to take
it from all. Okay, but okay, this is the butt
(15:42):
for all those people that are so smart that they
leave money at their four O one ks and the
four to fifty sevens. You must take your RMD separately
from each one of those counts. Does not satisfy from
the IRA accounts. That's where people get caught, right, I'm
(16:03):
leaving it at the four oh and k R. I'm
leaving it at the state with the four P fifty seven.
The TSP could be very problematic, especially for a surviving spouse.
So wait or get proactive. What's the answer? Well, I
(16:25):
think people who rely on rmds to live on a monthly, quarterly,
annual basis, they basically satisfy their rm D.
Speaker 4 (16:40):
By the end of the year.
Speaker 2 (16:42):
I know at the retirement Planning group at Fidelity, we
get a report from Fidelity, which I think is fantastic
that basically has all of our qualified assets iras right,
and it says mister and missus Apple have already satisfied
(17:03):
their R and D for the year twenty twenty five.
Mister and Missus Apple have not satisfied and this is
the remaining amount that needs to come out the door
in order to satisfy rm D. So Lisa inside my office,
we'll go through that data, she'll look at the distributions
(17:26):
that are going to go out in November and December
and she will say, Yep, we're in good shape, or nope,
we got to get a hold of them because we
no longer have the adequate amounts of money that are
going to be necessary to satisfy rm D. Now, what
could possibly change R and D?
Speaker 4 (17:46):
Right?
Speaker 2 (17:48):
What could possibly change rm ds? A nose dive in
the stock market? Right, Because it's based off the value
of December thirty first of the prior year. It doesn't
necessarily have to be an It could be the bull right,
the bulls take it off like a rocket. And now
the distributions that you are taking do not satisfy R
(18:09):
and D that you already have in place, which a
lot of times we call the systematic withdrawal. So we
are big fans of cash in the accounts. Right, divin ends.
You have a couple of options with your dividends, divin ends,
(18:31):
reinvested capital gains, reinvested divinends, not reinvested capital gains, or
a combination of both one or the other. But you
always want to have adequate amounts of cash. So you
that are you're listening right now when you're saying to yourself,
oh my god, I didn't take my money out. I
(18:55):
better call Dave Kopek and find out what am I
gonna do. And you're supposed to take twelve thousand dollars
out and you got six thousand dollars there, and everybody
knows T plus three. You sell positions on Monday, you're
not going to have access to the money asap. Guess what,
(19:16):
You're in deep weeds because you do not have enough
cash in order to facilitate what's necessary for rm D.
So make sure you understand that this is a slippery slope.
Market swings can have an impact positive or negative. But
(19:36):
the potential downside is is that if you miss the date,
miss the distribution, miss the opportunity for you to take
the doray me out, you're gonna get hit with a penalty,
and the penalty is severe. A lot of times people
will say, hey, listen, I don't know what money to
(19:57):
take out.
Speaker 4 (19:58):
Should they take it from my stocks, take it from
my bond? Should I take it?
Speaker 2 (20:02):
Doesn't really make any difference where you take it from,
but you have to take it. Government wants their income.
This is all taxes or iny income income taxes. Right,
somebody wants to, you know, run the calculation as far
as how much you should take, whether it be fifteen percent,
(20:22):
twenty percent. New York State is a little bit different
than other states as far as how much money was
withdrawn that is exempt from federal and state taxation. State
you get about twenty thousand dollars federal. One hundred percent
of it is taxes ordinary income. So beware of the risk.
(20:43):
There are risks to year in R and ds. We
are big believers at the retirement Planning Group. Take your
R and D at the beginning of the year, stop
screwing around with it. Don't worry about your net return.
It's a simple formula. It's an easy calculation. Get the
money the cash account, and then stay fully invested with
the rest of it. A lot of our clients don't
(21:04):
need the money, right, Dave, I don't need the R
and D. Well, I'm sorry, mister Apple, you have to
take the R and D. Okay, you created this monster
during your accumulation years. And what's the monster pre tax money?
Pre tax money. Everybody wants to watch that ROI on
(21:29):
that pre tax account. But the bottom line gets down
to it's not all your money. That's not your money.
Some of it's your money, but not all of it's
your money because of why the.
Speaker 4 (21:42):
Tax man cometh right.
Speaker 2 (21:46):
You got federal, you got state, and if you're unfortunate enough,
a state tax depending on the state that you live in,
because not all states are the same as far as
the exemption that's allowed. So just understand is that your
zip code, your zip code is critical with rm D
(22:08):
distributions and protection of the asset. What do you mean
by that? How many that are listening today in your car,
sitting at home, whatever it may be, that do not
have a long term care plan? Heard Lupiro show today,
the excellent show on a one to ten. It was
(22:31):
a ten as far as content that all you people
out there that do not have any type of a
plan when there's going to be a health event, and
then you listen that iras are protected from a Medicaid
spend down. That's not true. Some of it is maybe
(22:52):
depending on who you're working with in your zip code.
But what's happening now in your state is that iras
they're making you spend the money down based on life expectancy,
not based on r MD or periodic payments. So if
you're in a county that is aggressively going after iras
(23:12):
and you think, oh, well, they can't take my IRA
because I'm satisfying the required minimum distribution my periodic payments,
that's wrong. We live it every day where we get
letters from the counties that basically say, mister and missus Apple,
now don't have to take twelve thousand dollars out of
(23:34):
their account anymore. Now they got to take twenty one
or twenty two thousand dollars out of their account because
why because the counties are now making you spend the
money based on life expectancy, not on required minimum distribution.
So you just sit there and look at that big
pile of cash and one of the spouses passes away.
(23:57):
Typically it's the female. She gets popa his money and
then they combine it all together and they got this
big pot of cash. Well, statistically, my good man and
good lady, those assets hopefully you pass away quickly because
if you have an event and you live in the
wrong zip code, those assets are not going to go
to your beneficiaries. It's going to go to the county.
(24:21):
The county talk to an attorney on Friday in Syracuse,
working with one of our clients in the Syracuse office.
Speaker 4 (24:35):
And guess what.
Speaker 2 (24:38):
There are houses on fire, lots of money in iras
eighty five years old. She's got to go into a
long term care facility. And guess what's happening. A lot
of money. A lot of money's coming out, not because
it needs to come out because of R and D,
It's coming out because of life expectancy. Let's go to
Jeff real quick. Jeff, how are you hi? You said
(25:02):
something that wasn't technically correct?
Speaker 4 (25:04):
What's that? You said?
Speaker 2 (25:06):
You must take your RMD Y and that's not technically
correct because you can make a qualified charitable distribution. Let me,
I'll tell you what. Let me finish my self. Call
me back when I'm finished with my show, because that's
the next section. Go ahead, let me finish what I
have to say here. Okay, that's coming up. Okay, I
(25:27):
understand exactly what you're saying. You don't have to take
your rm D, but most people do not have charitable
intent with their rm D because they need to live
on the money. So but I'll go through that. That's
one of my charitable distribution for your IRA account. It
was one of my bullet points. And I'll give out
our telephone number one more time. It's five eight five
(25:48):
eight zero one nine one nine. Our corporate headquarters is
in Malta. We have an office in Glens Falls, Albany, Oneana, Syracuse.
Speaker 4 (25:56):
Five eight five eight zero one nine one nine.
Speaker 2 (25:58):
I'll be right back after this quick message. All right,
(26:26):
we are back. Wait talking about tis the season? Jeff
must have tuned in later than when I started the show.
You got April first, okay, that's the date that you
have in order to satisfy your required minimum distribution for
(26:49):
the year twenty twenty four. You don't get it out
the door, okay? In your age seventy three, you've got
some problems in Dodge, okay, so hopefully you got some
cash on the sidelines. If you didn't do it, then
get going now. I don't need the money, right, I
(27:10):
don't need the money. I'm trying to figure out what
I can do with it. There's two things that I
know legally that you can do with it, okay, in
order to satisfy your required minimum distribution. Now here's a tidbit,
because if I had a nickel for everybody that came
into my office. That basically said, I want to do
(27:31):
a ROTH conversion. You cannot use your RMD for Roth
conversion capeche. So if you got to take twenty thousand
out you want to do twenty five thousand dollars in
ROTH conversion, you're gonna have to take forty five hours
not allowable. Second, there's a thing called a qu LAC.
(27:53):
All right, most people don't even know what a QULAC is.
QULAC is a qualified longevity annuity contract. That's that dirty
word annuity that you hear most financial divisors talk about, right,
not positive but negative. But this allows you in order
(28:15):
to take two hundred and ten thousand dollars up to
two hundred and ten thousand of funds and qualified retirement accounts,
and you purchase it, and it delays the r and DS,
delays r and DS from age seventy three to age
eighty five. It's an option. We don't do a lot
(28:37):
of them. We've done some of them, we've done a
minimal amount.
Speaker 4 (28:41):
Okay. Second, okay, if.
Speaker 2 (28:48):
You're looking at different ways in order for you to
delay rm ds, right, or if you have charitable intent,
which talked about, you can take your distributions satisfy your
rm D if you have charitable intent. We have a
(29:11):
handful of people that have done this, a handful of people.
Most individuals have satisfied their R and D their charitable intent.
Some have done it, some have done it okay, some
have done the charitable intent. But you can turn your
R and D into a charitable contribution mayor every year
(29:34):
you do what they call a charitable qualified distribution from
your IRA. We have one woman down in the Kingston
area that worked for IBM who has quite a few
charitable contributions come out of our IRA, and I think
(29:56):
at least it's I know, it's like ten or twelve.
So there are ways to get around this. You just
need to understand that the best way to take care
of qualified plans, in my opinion, is when you have
(30:18):
assets all over town in different banks, financial credit unions,
whatever it may be, it is very difficult to get
your hands around the plan. Consolidation simplification is your friend.
(30:39):
Consolidation simplification is your friend. So just understand that the
risks that are associated with qualified assets are fairly great,
especially if depending.
Speaker 4 (30:57):
On the zip code.
Speaker 2 (30:59):
Depending on this zip code, the big thing, the Retirement
Planning Group is starting to see throughout New York State
counties are aggressively going after IRA assets. If you're trying
to qualify for Medicaid, what do I mean by that?
(31:19):
Because I want to say this over and over again
so you get crystal clear clarity on this. That means
that if you're doing periodic payments systematic withdrawal off of
R and D, they're saying that doesn't work anymore. You
now have to take the money based off of life expectancy.
(31:41):
Life expectancy which is a dramatically higher distribution than periodic
payments or rm D. So you can sit on the fence,
look at that big pot of money. We're in the
camp that you should utilize qualified assets in your life lifetime,
(32:01):
use it as income, use it as a pension benefit.
However you want to ultimately use the money in your lifetime.
The assets that are very complicated at death are IRA, MONEIS,
non qualified annuities, Series E bonds. All three of those assets.
There's never a step up in basis and the money
(32:24):
is always ird. Someone's going to have to pay the tax.
The question becomes do you pay the tax or do
you allow that to be passed on and say the
heck with it. Whoever receives the money, they're going to
have to pay the tax on it. So there are
a risk. There's risk to what we call ur n
(32:46):
rm ds. There's risk to make sure that you've satisfied
your rm D. There's risk that if you haven't satisfied
your rm D at the age of seventy three, you
have until April first of the following year in order
to satisfy it without any penalty. It's the only time
that that's allowed. If you have charitable intent, that's great.
(33:12):
The maximum this year is one hundred and eight thousand dollars.
One hundred and eight thousand dollars. That's a whole heck
of a lot of money. Also, if you have the
qul AC which I talked about, I believe I don't
have the numbers in front of me. I believe that's
two hundred semi thousand dollars ballpark which you can husband
(33:35):
and wife can reduce the amount that they're having coming
out based off of requiredment and distribution. There's a lot
of reasons to do this. Tax liabilities is stay planning
and can go through the whole laundry list. So make
sure you understand that i ara A distribution planning, as
I've said over and over again, is very complicated, and
(34:00):
IRA distribution planning should really be specific for you, your
loved ones, your spouse. We are big believers of disclaiming
IRA assets, especially if there is a lot of money
in the pot when the primary holder of that IRA
passes away. As an example, we just had a situation
(34:20):
where a client of ours well over seven figures in
an IRA, wife did not need all of the money.
We basically took a portion of that money, disclaimed a
good portion of the money. The three children received the
assets as if the mother had passed away. The money
(34:43):
goes to the kids. Now the mother only is retaining
the money that is necessary for her quality of life.
You get it down the road and then they can
utilize those assets and they can basically take it out
over a ten year period of time. Husband and wife
(35:04):
client of ours. I've said this before, but I'll say
it again because it always resonates with me. Very successful,
great investors. She was a school administrator, he was a teacher.
They have pench of benefits and excess to two hundred
thousand dollars a year. He is upset her sister passed away.
Speaker 4 (35:32):
Excuse me.
Speaker 2 (35:35):
The money that they received was qualified assets substantial, close
to two million dollars in IRA assets. Only one beneficiar,
the sister. The will basically said, this is my intentions
(35:57):
of these assets. Wanted some of the money to go
to the nieces and nephews. Well, they were not named
as contingent beneficiaries. So the wife of this gentleman, her
sister passes, almost two million dollars comes to them. Now
(36:20):
she has to start taking distributions on these moneies, not
because she wants to, but she's forced to liquidate the money.
It's affecting them tax wise substantially. Also it's also affecting
their Medicare premiums. And he's saying to me, Dave, I
don't want this money. And I said, Larry, it's too late.
(36:42):
The horse is out of the barn. There's nothing you
can do about it. When your sister in law set
this up, she named no contingent beneficiaries. So now you're
in a situation where you're gonna pay these taxes for
an extended period of time, or you can do everything
that you possibly can to spend the money down in
a very short period of time. This is the problem
(37:06):
that a lot of people are going to face over
the next twenty to thirty years. The greatest wealth transfer
in the history of mankind will happen over the next
twenty to thirty years. Estimate it to be somewhere around
eighty five trillion dollars trillion with a t eighty five
trillion dollars of wealth will transfer from my generation to
(37:29):
my children's and my grandchildren's generation. ROI means nothing if
a good percentage of it is going to go to
our friends in Washington, in the state, this could happen
to you. For some of you that are listening that
will pooh pooh it, do nothing about it, sit on
the fence, most likely something will happen. IRA distribution planning,
(37:56):
in my opinion, is probably the least amount of planning
that's put into place, and for some of you, it's
the most the most valuable asset beside your home that
you that you have. Not unusual for a husband and
(38:19):
wife to come in between their four and one k
IRA assets pre tax money value of their house, seventy
to eighty percent of their net worth is in those
two assets. IRA in real estate your partner for success.
David kopekair WG WISE Retirement planning specialists, the Retirement Planning Group.
(38:45):
We understand that retirees face many important decisions that can
affect their long term financial success.
Speaker 4 (38:51):
Some of these decisions.
Speaker 2 (38:52):
Revolve around making investments that will help create a hedge
against outliving their assets, the impact of inflation, taxation.
Speaker 4 (39:01):
And rising health care costs.
Speaker 2 (39:03):
Most of our clients like the time, the desire, or
the experience to manage their own investment portfolios. We consider
it to be an honor and a privilege to help
our clients make sound investment decisions, though contribute to a
secure financial future for them. Because over ninety percent of
our clients are retirees with similar concerns, we are in
(39:24):
the best position to approach such challenges with experience and skill.
Give us a call today at five one eight, five
eight zero one nine one nine five one eight five
eight zero one nine one nine or RPG Retire on
the web. We run out of money in retirement where
your investments provide income for possibly decades. How do you
navigate the two greatest risk in retirement sequence of returns
(39:46):
in longevity At the retirement Planning Group. Our Bucket of
Money approach addresses these concerns and we offer a complementary
consultation to discuss this with you. Call our office today
for a free complementary consultation to develop your own personal
retirement income distribution plan at five win eight five eight
zero one nine one nine. That's five one eight, five
eight zero one nine one nine.
Speaker 4 (40:45):
The year we are back.
Speaker 2 (40:53):
I'm live in the studio, which is unusual. So I'm
here with my brother Zach, my engineer. My twenty fifth
year on radio, which is hard to believe, twenty five years,
my silver anniversary, forty three years in the business. I
can tell you, folks, if you're not doing planning for
(41:14):
your iras, you're doing yourself a huge disservice. You know,
there's different ways that you can reduce I talked about
the qu LAC. I talked about the charitable distribution. You
get to claim a charitable deduction, No you don't, but
(41:35):
you don't have to pay taxes on the distribution. So
there's different ways to slice and dice. It doesn't have
to be all or none. But you want to do
one thing for sure. You want to make sure that
everybody is on the same page, meaning that if you've
(41:57):
got the credit Union, you got the four oh one K,
you got the TSP, you get the four oh three B,
you got the IRA's, you got the wroth, and they're
all in different locations.
Speaker 4 (42:12):
That is a nightmare. That is a nightmare. You know.
Speaker 2 (42:16):
One of the things that I've said a million times over,
one of the greatest things that ever came out of
Washington was what the wroth wroth IRA wroth for one K?
Why is that?
Speaker 4 (42:31):
Well?
Speaker 2 (42:32):
Tax three, tax free, tax free pony up. You pay
your tax when you put it in, when it comes out,
it's all tax free distributions, tax free accumulation. And when
your loved ones receive the assets, yes, they're subject to
R and D even if it's a wroth at death
(42:54):
at the death of the second spouse the primary which
is typically the wife, right, But but it's all tax free.
So a lot of times when we sit down with
individuals and they're still in the accumulation side of their business,
(43:16):
make sure you understand the apple that you're creating. We
use E money. We just bought another software package that's
gonna compliment E money that was basically presented to us
the last time we were at a convention at Fidelity
(43:36):
in Boston. And to say that it's got bells and
whistles and sizzle and snap, crackle and pops an understatement.
It gives you a dashboard, what I call the dashboard
of your financial life where you stand. It can be
as in depth as you want it to be, and
you can keep it basically minimal as much much as
(44:00):
you want it to be. But basically you can put
your life in front of you. Not only as far
as your investments, your cash, your credit cards, your legal documents,
they have a vault. Think about the people. And I
(44:21):
can say this because I've lived it and I've seen it.
I've seen the horror on people's faces when they go
home and there's nothing there. Benita Beach, Fort Myers Beach,
South Fort Myers Beach, Carolinas. They go home, there's no house,
(44:42):
there's no legal documents, there's no safe, there's nothing. It's
all gone. How do you recreate that? Are you better
off basically having someone in the bullpen? If you do
the analogy of baseball, primary person doesn't go through, Yeah,
(45:05):
I gotta bring the bullpen in. It's no different with
your investments and your assets and your legal documents. I
am a huge, huge believer, especially with what I've seen
over the last few years, the devastation will. I've literally
seen homes that existed that I went down on Benita
Beach Road in Florida that no longer existed, that vaporized.
(45:28):
Nobody knew where anything was. It happened in the Carolinas.
It will happen again. It can happen up here. So
we can be as proactive as you want us to be,
and we can be as passive as you want us
to be. But the bottom line gets down to is
that I'm in the camp that this is a service
(45:51):
that I at the Retirement Planning Group, not Fidelity. They
give me the opportunity to provide it to you. I
pay for it for our client, but it allows you
to basically sleep at night and basically say, listen, if
something happens to us. I know where the beneficiary forms are,
I know where the trust document is, I know where
(46:12):
the will is, I know where the power of attorney
here is.
Speaker 4 (46:15):
I know where the health proxies are.
Speaker 2 (46:17):
I know all our codes and passwords in order to
get into all these accounts, is that your situation most.
Speaker 4 (46:22):
Of you absolutely positively, not.
Speaker 2 (46:26):
Absolutely positively, not if something happened. So you know, I've
seen a lot in forty three years being in this business.
The one thing that I haven't seen, I haven't seen
anything yet where I walk into a situation where everybody's
(46:47):
buttoned up. There's always what I call the holes in
the boat, a few things that need to be fixed,
and that's all right. Some people think that they're in
really good shape, and a lot of times they are,
it's just they need minor adjustments. So if you're in
(47:07):
a situation that you have a lot of money and
qualified plans, if you're in a situation where you feel overwhelmed.
Speaker 4 (47:19):
That you need some.
Speaker 2 (47:20):
Kind of a plan in place when the first spouse
passes away. If you're in a situation where you've got
a lot of money and qualified assets, you put your
house into a trust, and you think that you know
you're in pretty good shape. Well maybe you are, depending
on the zip code that you live in. But if
you're not in a zip code that protects IRA assets,
(47:43):
you could be in a whole lot of hurt. It
could be a lot of money that goes down the road,
because if I need to write a check in an
IRA for one hundred thousand dollars, I might have to
write a check for one hundred and forty one hundred
and fifty thousand dollars depending on my tax bracket to
get the net result, because that IRA four oh and
K four O three B all that pretax money is
(48:05):
taxes ordinary income. So it's it's a slippery slope. Everybody
has a different way that they want to have their
assets managed. You know, I've said this a million times.
It's been proven over and over and over again. Whether
it's Fidelity, Vanguard, Schwab, any of your major investment banking firms,
(48:30):
whether it's Merrill Lynch, they all say the same thing.
Working with a financial team will help you, It will
be beneficial, and the net result will be better for
you and your family. We don't claim to have all
the answers that the retirement planning group, but what we
do is we sit down and have a chat with you.
(48:50):
First appointment, we do nothing. We just have a conversation.
Second appointment, we come back with ideas and recommendations, and
then you go home and think about it in the
If you're ready to move forward, we start implementing the plan.
Implementing the plan. One of the hardest things that I've
(49:12):
dealt with in all the years that I've been working
in the financial services business is walking into a house
when one of the spouses has passed away. Because you
you know, our clients become like family to us. You know,
it might sound kind of corny, but it's the truth.
And the thing is is that the last thing that
(49:34):
we want is for that spouse, whether it's the male
or the female, to worry about that things are not
put together, buttoned up. So if you need help, you
need assistance, that's what we're here for. We got five
locations down New York, Syracuse, Albany, Multi Slash, Saratoga Springs,
(49:56):
Oniana and Glen's Falls. If you like to come in
for a consultation, it's pretty easy. You can just give
us a call. Five one eight five eight zero one
nine one nine is our primary telephone number. Five one
eight five eight zero one nine one nine. You can
check us out on the web rpgretire dot com, rpgretire
(50:20):
dot com. And again, as I always say, you know,
whether it's us or someone else. Ninety nine point nine
nine nine percent of the financial advisors out there are
working in your best interest. You'll never hear Dave Kopek
(50:42):
or anybody on my team talk negative about other financial advisors.
It's a tough business. It's also a business that can
give you great rewards. So again, if we can be
of assistance, it would be an honor. Again, our telephone
number is five one eight five eat zero one nine
one nine. You can check us out on the web
(51:03):
rpgretire dot com. And here's the most important question of
the day. Who wins today? Who wins?
Speaker 4 (51:14):
Florida and Duke?
Speaker 3 (51:15):
Even though I want Alabama.
Speaker 2 (51:18):
I think Alabama wins. I think Alabama wins. And who's
Florida playing against? Is a Florida Alabama?
Speaker 3 (51:33):
No, Alabama's playing Duke. And the only reason I picked
Duke is because Duke I've seen played defense would need
to be Yeah.
Speaker 2 (51:41):
No matter who wins, it's going to be great, great,
great basketball. So again, folks, march madness, everybody have an
absolutely fantastic weekend. If we can be of assistance, it
would be an honor. Give us a call five win
eight if five eat zero one nine one nine. And again,
if you want to check us out on the web.
Are pg retire dot com. It's just our pg retire
(52:06):
dot com. Be safe and have a great weekend.
Speaker 1 (52:12):
Thank you for listening to Retirement Ready, hosted by Dave Kopek.
If you would like to talk with Dave or someone
at the Retirement Planning Group, called five one eight five
AID zero one nine one nine. That's five one eight
five EID zero one nine one nine during business hours,
or visit rpg retire dot com. The Retirement Planning Group
has five convenient offices located in Albany, Malta, Glens Falls, Pontiata,
(52:37):
and Syracuse. Tune in again next week at noon for
Retirement Planning Strategies with David Kopek, or Saturdays at seven
am for the Retirement Planning Show.
Speaker 3 (52:47):
The information our services discussed on this show is for
informational purposes only and is not intended to be personal
financial advice.
Speaker 4 (52:53):
The investments and services offered by us may not be
suitable for all investors. If you have any doubts as
to the merits of an investment, you should seek advice
from an independent financial advisor.
Live from the wgy iHeart Studios. Welcome to Retirement Ready
with your host Dave Kopek from the Retirement Planning Group.
Every week, Dave and his team discuss the ways they
can help people make informed decisions about their retirement assets
to maintain, improve, and secure their desired quality of life.
Here's your host, Dave Copet.
Speaker 2 (00:40):
All right, Capital District five point eight, Outside the Boundaries,
Retirement Ready topic specific. We are live in the studios
today with my number one man, Zach Engineer.
Speaker 3 (01:02):
I'm gonna let your son know that.
Speaker 4 (01:05):
Sports enthusiast.
Speaker 2 (01:08):
This morning we talked a little bit about what's going
on with the NIL, so we'll talk about anything, but
I am not a fan of NIL. I think it's
destroying college sports. Just so everybody knows, you got kids
making eight nine, ten million dollars at age eighteen. Not
(01:31):
a good recipe in my opinion. That's all I'm gonna say.
That's my story and I'm sticking to it. So hopefully
you're out there enjoying the UH. I guess you could
say this is Upstate New York weather for this time
of year, crappy, overcast, raining, chili cold. To all of
(01:55):
our friends, in Florida and surrounding areas out side the
five and eight. Hopefully your day is a little bit
better than ours, because it does not look it's getting
like it's getting any better, is it, weather Man?
Speaker 3 (02:10):
Now it's not looking too good this weekend.
Speaker 2 (02:12):
Now next year, I'm not going to Florida for January
and February. I'm going to Florida for January, February of March.
Ain't coming back. I will come back for specific days,
but I will get my back on the seat of
(02:33):
the Jet Blue airline and arrive in two hours and
forty five minutes to Fort Lauderdale. So if you got
any questions or comments, were lived, talk WGY. That's one
eight hundred eight two five fifty nine forty nine. Today
we're going to talk a little bit about the problematic
(02:54):
money IRA money. We're going to talk about rm ds.
You got a time frame here. If you did not
take your money out of your IRA in the year
twenty twenty four and you were mandated to take it out,
then you got a couple of days in order to
get the money out the door of you're going to
(03:15):
suffer a penalty. So bottom line is this, this is
talk radio, not Babbel Radio. So if you have a
question or comment, love to have you participate. As I said,
this is talk radio, not Babbel radio, So if you
have a question or a comment, it always makes it
(03:36):
a little bit more interesting, I believe to listen to
the show. So here we go. Ready, r and ds
Required minimum distributions. There's some key decisions that loom for
(03:59):
people that earn the age of seventy three. Now that
seventy and a half. So if you turned age seventy
three in the year two thousand and twenty four, you
were required to take required minimum distribution from your pre
tax accounts, your IRA four h three, B four oh one, k,
(04:22):
et cetera. If you didn't guess what, you got a
safe haven here until April first.
Speaker 4 (04:32):
So what does that mean.
Speaker 2 (04:33):
That means that it's the only time that it's allowed
that you have the ability to satisfy the rm D
the first year at age seventy three, and you have
until April first in order to facilitate that RMD that
you were supposed to take in the year two thousand
and twenty four. If you don't, you don't take it,
(04:59):
you're gonna get hit with some major penalties, and they
will bing gin accruing, which you don't want because the
IRS has a tendency not to be warm and fuzzy
about this. So so if you turn seventy three last year,
(05:19):
you can postpone your distribution until April first of the
following year, but every year after it must be taken
within the calendar year. Got that capeche. So if you
postponed last year's distribution to April first, you're gonna have
(05:41):
to take both of your two thy and twenty four
and twenty five rm ds by the end of this
year December thirty first of two thousand and twenty five.
There's no exception. There's no exception. So if you're still
working and own more than five percent of a business
(06:03):
sponsoring your plan, then there is But this is one
of the reasons which I talked about this warning. If
you are continuing to work, now, let's just say that
mister or miss Wonderful got a hold of you and said,
(06:23):
now you got to roll your money into a self
directed IRA because you retired from XYZ Corporation. And it's
a lot of money, a lot of dora me hundreds
of thousands of dollars and not seven figures. You do
have an option, I did it myself. What is that
(06:45):
you can roll that money into your current four to
oh one K plan as long as you are considered
to be fully employed. That means that you do not
have to take R and D any longer because you
no longer have that keyword IRA and because you are
(07:11):
still employed and the money's in a four to oh
one K, there's no required minimum distribution to you do
what stop working? Stop working? So you can hold off
the rm ds and you can adjust your rm DS
with a couple of other options I'll discuss today.
Speaker 4 (07:34):
But no matter what.
Speaker 2 (07:35):
Your age that you're at, there are strategies to utilize.
But there are trillions, folks of dollars in qualified assets
trillions with a T not B or an m T
trillions estimate it somewhere to be around forty trillion dollars
(07:58):
of assets that are held in qualify five plans as
of the end of twenty and twenty four. So if
that is the case, good guess what our friends in
Washington are looking for you to turn the spickt on
because they want what the money, they want, the taxes,
(08:19):
they want, the denaros the doray me. So when you
calculate your rm D by dividing your account value by
December thirty first of the prior year, there's a uniform
lifetimetable and that will tell you that's how much money
you have to take out. So if your IRA assets
(08:40):
were value that let's say three hundred thousand dollars December
thirty first to last year, and you would be that
magical age now seventy five at year in your life
expectancy is twenty four point six, and your RMD for
your two thousand and twenty five will be twelve thousand,
(09:02):
one hundred and ninety five dollars. Whether you want it
or not. Whether you want it or not, the money's
coming out the door because IRS says you've had all
these years of accumulation on a tax deferred basis. Now
you don't have to have that happen if you are
(09:24):
still employed and you have access to a four oh
one K program, because most of those four oh one
K programs will allow you to roll your IRA assets
into your existing four oh one K and you're not
going to have a tax liability of twelve one ninety
five dollars why am I saying that?
Speaker 4 (09:45):
Look at Baron's This Week. Barons this Week has an.
Speaker 2 (09:49):
Article of how much longer people are expected to live
and guess what. People that are the boomer are expected
to work longer. Not necessarily because they're high fiving and
jumping up and down, but they want to stay relevant.
(10:10):
They want to basically have a purpose in their life.
They want to get up in the morning and instead
of worrying about what am I gonna have for breakfast?
Am I taking my walk? Is the pickup ball day?
What are we doing? They have a purpose, They get
up and they basically have a job that they love.
(10:32):
A lot of people actually leave what they did for
thirty or forty years and now they have a job
of purpose, passion, something that they always wanted to do.
So we're going to talk a lot about rm d's
IRA distribution planning today. I'm live in the studio. We
always welcome phone calls. Zach don't like to have him
(10:56):
sit back in his chair and fall asleep. So our
telephone number here is one eight hundred talk WGY. That's
one eight hundred eight two five fifty nine forty nine.
Love to have questions always makes it more interesting. This
is not babble radio. This is talk radio. So if
you have questions or comments, even if it's off topic,
that's fine. One eight hundred Talk WGY one eight hundred
(11:21):
eight two five fifty nine forty nine. I'm Dave Kopec,
President of the Retirement Planning Group. I'll be right back
the eighty six percenters. Do you know that eighty six
percent of the population has no defined benefit pension plan.
For most of us, we have to take our life
savings and create a paycheck for the rest of our
lives in retirement. What is your plan for retirement income distribution?
How will you manage your assets during the most critical years.
Speaker 4 (11:43):
Of your lifetime.
Speaker 2 (11:44):
Nobel Prize winning economist William Sharp has called retirement income
distribution the nastiest, hardest problem in finance. He points out
that investment, uncertainty, and mortality can derail the most careful
laid out retirement income plan. Call our offices TOAD to
start the process of building your retirement income distribution plan.
After forty one years of being in the financial services business,
(12:06):
you need to start taking action to start building your
own personal retirement income distribution plan.
Speaker 4 (12:12):
How do you do that?
Speaker 2 (12:13):
To take action five one eight, five eight zero one
nine nine. That's five one eight, five eight zero one
nine one nine or RPG retire on the web. Don't procrastinate,
motivate to start building your retirement income distribution plan five
win eight five eight zero one nine one nine. The
greatest risk in retirement most of us have no plan
for We're insurance to cover the expense A long term
(12:35):
care event can impoverish a spouse, drain your life savings,
and cost stress and anxiety on your family. What is
your plan and how will you pay for a long
term caravent? Call the Retirement Planning Group today. Discuss options
you should consider to protect your estate and have choices
and independence. Take action call today five one eight, five
eight zero one nine one nine or RPG retire on
(12:58):
the web.
Speaker 4 (13:26):
Waiting for the spring sas for something to say, all right,
we are back Chicago, Well Chicago there. Did you ever
see them in concerts?
Speaker 2 (13:48):
I can't say I have no. They're excellent, unbelievable in concert.
Got those horns are blowing. I don't know if they
still wid. I saw him in concert years ago, that
years ago, many months ago.
Speaker 4 (14:03):
How's that.
Speaker 2 (14:06):
It was?
Speaker 4 (14:06):
Well? Worth the trip new concert guy.
Speaker 3 (14:10):
I used to be not so much anymore. Me I'm
too old and you can't leave your house without spending.
Speaker 2 (14:20):
But you'll spend five hundred dollars for a Philadelphia Eagle ticket.
Speaker 4 (14:24):
Oh that's different.
Speaker 3 (14:26):
Hey, they only won two Super Bowls in fifty nine years.
They'll leave me be.
Speaker 2 (14:33):
My son's coming in. We're gonna have a chat. We
got a show that we do in Syracuse after this
one live. He calls me the trader. I was a
New York Giant fan for years, but after last year,
I said that's it no more. I'm out. Now I'm
a Buffalo Bill fan. Go Bills. All right, we're talking
(14:59):
about that mad time of year. April first. Everybody thinks
about taxes April fifteenth. But beware, if you did not
take your required minimum distributions to satisfy RMD in the
year twenty twenty four. If you have multiple IRA accounts,
(15:21):
you must calculate the R and D for each one,
aggregated together, divide by the uniform lifetimetable. You can take
the distribution from one account. You don't have to take
it from all. Okay, but okay, this is the butt
(15:42):
for all those people that are so smart that they
leave money at their four O one ks and the
four to fifty sevens. You must take your RMD separately
from each one of those counts. Does not satisfy from
the IRA accounts. That's where people get caught, right, I'm
(16:03):
leaving it at the four oh and k R. I'm
leaving it at the state with the four P fifty seven.
The TSP could be very problematic, especially for a surviving spouse.
So wait or get proactive. What's the answer? Well, I
(16:25):
think people who rely on rmds to live on a monthly, quarterly,
annual basis, they basically satisfy their rm D.
Speaker 4 (16:40):
By the end of the year.
Speaker 2 (16:42):
I know at the retirement Planning group at Fidelity, we
get a report from Fidelity, which I think is fantastic
that basically has all of our qualified assets iras right,
and it says mister and missus Apple have already satisfied
(17:03):
their R and D for the year twenty twenty five.
Mister and Missus Apple have not satisfied and this is
the remaining amount that needs to come out the door
in order to satisfy rm D. So Lisa inside my office,
we'll go through that data, she'll look at the distributions
(17:26):
that are going to go out in November and December
and she will say, Yep, we're in good shape, or nope,
we got to get a hold of them because we
no longer have the adequate amounts of money that are
going to be necessary to satisfy rm D. Now, what
could possibly change R and D?
Speaker 4 (17:46):
Right?
Speaker 2 (17:48):
What could possibly change rm ds? A nose dive in
the stock market? Right, Because it's based off the value
of December thirty first of the prior year. It doesn't
necessarily have to be an It could be the bull right,
the bulls take it off like a rocket. And now
the distributions that you are taking do not satisfy R
(18:09):
and D that you already have in place, which a
lot of times we call the systematic withdrawal. So we
are big fans of cash in the accounts. Right, divin ends.
You have a couple of options with your dividends, divin ends,
(18:31):
reinvested capital gains, reinvested divinends, not reinvested capital gains, or
a combination of both one or the other. But you
always want to have adequate amounts of cash. So you
that are you're listening right now when you're saying to yourself,
oh my god, I didn't take my money out. I
(18:55):
better call Dave Kopek and find out what am I
gonna do. And you're supposed to take twelve thousand dollars
out and you got six thousand dollars there, and everybody
knows T plus three. You sell positions on Monday, you're
not going to have access to the money asap. Guess what,
(19:16):
You're in deep weeds because you do not have enough
cash in order to facilitate what's necessary for rm D.
So make sure you understand that this is a slippery slope.
Market swings can have an impact positive or negative. But
(19:36):
the potential downside is is that if you miss the date,
miss the distribution, miss the opportunity for you to take
the doray me out, you're gonna get hit with a penalty,
and the penalty is severe. A lot of times people
will say, hey, listen, I don't know what money to
(19:57):
take out.
Speaker 4 (19:58):
Should they take it from my stocks, take it from
my bond? Should I take it?
Speaker 2 (20:02):
Doesn't really make any difference where you take it from,
but you have to take it. Government wants their income.
This is all taxes or iny income income taxes. Right,
somebody wants to, you know, run the calculation as far
as how much you should take, whether it be fifteen percent,
(20:22):
twenty percent. New York State is a little bit different
than other states as far as how much money was
withdrawn that is exempt from federal and state taxation. State
you get about twenty thousand dollars federal. One hundred percent
of it is taxes ordinary income. So beware of the risk.
(20:43):
There are risks to year in R and ds. We
are big believers at the retirement Planning Group. Take your
R and D at the beginning of the year, stop
screwing around with it. Don't worry about your net return.
It's a simple formula. It's an easy calculation. Get the
money the cash account, and then stay fully invested with
the rest of it. A lot of our clients don't
(21:04):
need the money, right, Dave, I don't need the R
and D. Well, I'm sorry, mister Apple, you have to
take the R and D. Okay, you created this monster
during your accumulation years. And what's the monster pre tax money?
Pre tax money. Everybody wants to watch that ROI on
(21:29):
that pre tax account. But the bottom line gets down
to it's not all your money. That's not your money.
Some of it's your money, but not all of it's
your money because of why the.
Speaker 4 (21:42):
Tax man cometh right.
Speaker 2 (21:46):
You got federal, you got state, and if you're unfortunate enough,
a state tax depending on the state that you live in,
because not all states are the same as far as
the exemption that's allowed. So just understand is that your
zip code, your zip code is critical with rm D
(22:08):
distributions and protection of the asset. What do you mean
by that? How many that are listening today in your car,
sitting at home, whatever it may be, that do not
have a long term care plan? Heard Lupiro show today,
the excellent show on a one to ten. It was
(22:31):
a ten as far as content that all you people
out there that do not have any type of a
plan when there's going to be a health event, and
then you listen that iras are protected from a Medicaid
spend down. That's not true. Some of it is maybe
(22:52):
depending on who you're working with in your zip code.
But what's happening now in your state is that iras
they're making you spend the money down based on life expectancy,
not based on r MD or periodic payments. So if
you're in a county that is aggressively going after iras
(23:12):
and you think, oh, well, they can't take my IRA
because I'm satisfying the required minimum distribution my periodic payments,
that's wrong. We live it every day where we get
letters from the counties that basically say, mister and missus Apple,
now don't have to take twelve thousand dollars out of
(23:34):
their account anymore. Now they got to take twenty one
or twenty two thousand dollars out of their account because
why because the counties are now making you spend the
money based on life expectancy, not on required minimum distribution.
So you just sit there and look at that big
pile of cash and one of the spouses passes away.
(23:57):
Typically it's the female. She gets popa his money and
then they combine it all together and they got this
big pot of cash. Well, statistically, my good man and
good lady, those assets hopefully you pass away quickly because
if you have an event and you live in the
wrong zip code, those assets are not going to go
to your beneficiaries. It's going to go to the county.
(24:21):
The county talk to an attorney on Friday in Syracuse,
working with one of our clients in the Syracuse office.
Speaker 4 (24:35):
And guess what.
Speaker 2 (24:38):
There are houses on fire, lots of money in iras
eighty five years old. She's got to go into a
long term care facility. And guess what's happening. A lot
of money. A lot of money's coming out, not because
it needs to come out because of R and D,
It's coming out because of life expectancy. Let's go to
Jeff real quick. Jeff, how are you hi? You said
(25:02):
something that wasn't technically correct?
Speaker 4 (25:04):
What's that? You said?
Speaker 2 (25:06):
You must take your RMD Y and that's not technically
correct because you can make a qualified charitable distribution. Let me,
I'll tell you what. Let me finish my self. Call
me back when I'm finished with my show, because that's
the next section. Go ahead, let me finish what I
have to say here. Okay, that's coming up. Okay, I
(25:27):
understand exactly what you're saying. You don't have to take
your rm D, but most people do not have charitable
intent with their rm D because they need to live
on the money. So but I'll go through that. That's
one of my charitable distribution for your IRA account. It
was one of my bullet points. And I'll give out
our telephone number one more time. It's five eight five
(25:48):
eight zero one nine one nine. Our corporate headquarters is
in Malta. We have an office in Glens Falls, Albany, Oneana, Syracuse.
Speaker 4 (25:56):
Five eight five eight zero one nine one nine.
Speaker 2 (25:58):
I'll be right back after this quick message. All right,
(26:26):
we are back. Wait talking about tis the season? Jeff
must have tuned in later than when I started the show.
You got April first, okay, that's the date that you
have in order to satisfy your required minimum distribution for
(26:49):
the year twenty twenty four. You don't get it out
the door, okay? In your age seventy three, you've got
some problems in Dodge, okay, so hopefully you got some
cash on the sidelines. If you didn't do it, then
get going now. I don't need the money, right, I
(27:10):
don't need the money. I'm trying to figure out what
I can do with it. There's two things that I
know legally that you can do with it, okay, in
order to satisfy your required minimum distribution. Now here's a tidbit,
because if I had a nickel for everybody that came
into my office. That basically said, I want to do
(27:31):
a ROTH conversion. You cannot use your RMD for Roth
conversion capeche. So if you got to take twenty thousand
out you want to do twenty five thousand dollars in
ROTH conversion, you're gonna have to take forty five hours
not allowable. Second, there's a thing called a qu LAC.
(27:53):
All right, most people don't even know what a QULAC is.
QULAC is a qualified longevity annuity contract. That's that dirty
word annuity that you hear most financial divisors talk about, right,
not positive but negative. But this allows you in order
(28:15):
to take two hundred and ten thousand dollars up to
two hundred and ten thousand of funds and qualified retirement accounts,
and you purchase it, and it delays the r and DS,
delays r and DS from age seventy three to age
eighty five. It's an option. We don't do a lot
(28:37):
of them. We've done some of them, we've done a
minimal amount.
Speaker 4 (28:41):
Okay. Second, okay, if.
Speaker 2 (28:48):
You're looking at different ways in order for you to
delay rm ds, right, or if you have charitable intent,
which talked about, you can take your distributions satisfy your
rm D if you have charitable intent. We have a
(29:11):
handful of people that have done this, a handful of people.
Most individuals have satisfied their R and D their charitable intent.
Some have done it, some have done it okay, some
have done the charitable intent. But you can turn your
R and D into a charitable contribution mayor every year
(29:34):
you do what they call a charitable qualified distribution from
your IRA. We have one woman down in the Kingston
area that worked for IBM who has quite a few
charitable contributions come out of our IRA, and I think
(29:56):
at least it's I know, it's like ten or twelve.
So there are ways to get around this. You just
need to understand that the best way to take care
of qualified plans, in my opinion, is when you have
(30:18):
assets all over town in different banks, financial credit unions,
whatever it may be, it is very difficult to get
your hands around the plan. Consolidation simplification is your friend.
(30:39):
Consolidation simplification is your friend. So just understand that the
risks that are associated with qualified assets are fairly great,
especially if depending.
Speaker 4 (30:57):
On the zip code.
Speaker 2 (30:59):
Depending on this zip code, the big thing, the Retirement
Planning Group is starting to see throughout New York State
counties are aggressively going after IRA assets. If you're trying
to qualify for Medicaid, what do I mean by that?
(31:19):
Because I want to say this over and over again
so you get crystal clear clarity on this. That means
that if you're doing periodic payments systematic withdrawal off of
R and D, they're saying that doesn't work anymore. You
now have to take the money based off of life expectancy.
(31:41):
Life expectancy which is a dramatically higher distribution than periodic
payments or rm D. So you can sit on the fence,
look at that big pot of money. We're in the
camp that you should utilize qualified assets in your life lifetime,
(32:01):
use it as income, use it as a pension benefit.
However you want to ultimately use the money in your lifetime.
The assets that are very complicated at death are IRA, MONEIS,
non qualified annuities, Series E bonds. All three of those assets.
There's never a step up in basis and the money
(32:24):
is always ird. Someone's going to have to pay the tax.
The question becomes do you pay the tax or do
you allow that to be passed on and say the
heck with it. Whoever receives the money, they're going to
have to pay the tax on it. So there are
a risk. There's risk to what we call ur n
(32:46):
rm ds. There's risk to make sure that you've satisfied
your rm D. There's risk that if you haven't satisfied
your rm D at the age of seventy three, you
have until April first of the following year in order
to satisfy it without any penalty. It's the only time
that that's allowed. If you have charitable intent, that's great.
(33:12):
The maximum this year is one hundred and eight thousand dollars.
One hundred and eight thousand dollars. That's a whole heck
of a lot of money. Also, if you have the
qul AC which I talked about, I believe I don't
have the numbers in front of me. I believe that's
two hundred semi thousand dollars ballpark which you can husband
(33:35):
and wife can reduce the amount that they're having coming
out based off of requiredment and distribution. There's a lot
of reasons to do this. Tax liabilities is stay planning
and can go through the whole laundry list. So make
sure you understand that i ara A distribution planning, as
I've said over and over again, is very complicated, and
(34:00):
IRA distribution planning should really be specific for you, your
loved ones, your spouse. We are big believers of disclaiming
IRA assets, especially if there is a lot of money
in the pot when the primary holder of that IRA
passes away. As an example, we just had a situation
(34:20):
where a client of ours well over seven figures in
an IRA, wife did not need all of the money.
We basically took a portion of that money, disclaimed a
good portion of the money. The three children received the
assets as if the mother had passed away. The money
(34:43):
goes to the kids. Now the mother only is retaining
the money that is necessary for her quality of life.
You get it down the road and then they can
utilize those assets and they can basically take it out
over a ten year period of time. Husband and wife
(35:04):
client of ours. I've said this before, but I'll say
it again because it always resonates with me. Very successful,
great investors. She was a school administrator, he was a teacher.
They have pench of benefits and excess to two hundred
thousand dollars a year. He is upset her sister passed away.
Speaker 4 (35:32):
Excuse me.
Speaker 2 (35:35):
The money that they received was qualified assets substantial, close
to two million dollars in IRA assets. Only one beneficiar,
the sister. The will basically said, this is my intentions
(35:57):
of these assets. Wanted some of the money to go
to the nieces and nephews. Well, they were not named
as contingent beneficiaries. So the wife of this gentleman, her
sister passes, almost two million dollars comes to them. Now
(36:20):
she has to start taking distributions on these moneies, not
because she wants to, but she's forced to liquidate the money.
It's affecting them tax wise substantially. Also it's also affecting
their Medicare premiums. And he's saying to me, Dave, I
don't want this money. And I said, Larry, it's too late.
(36:42):
The horse is out of the barn. There's nothing you
can do about it. When your sister in law set
this up, she named no contingent beneficiaries. So now you're
in a situation where you're gonna pay these taxes for
an extended period of time, or you can do everything
that you possibly can to spend the money down in
a very short period of time. This is the problem
(37:06):
that a lot of people are going to face over
the next twenty to thirty years. The greatest wealth transfer
in the history of mankind will happen over the next
twenty to thirty years. Estimate it to be somewhere around
eighty five trillion dollars trillion with a t eighty five
trillion dollars of wealth will transfer from my generation to
(37:29):
my children's and my grandchildren's generation. ROI means nothing if
a good percentage of it is going to go to
our friends in Washington, in the state, this could happen
to you. For some of you that are listening that
will pooh pooh it, do nothing about it, sit on
the fence, most likely something will happen. IRA distribution planning,
(37:56):
in my opinion, is probably the least amount of planning
that's put into place, and for some of you, it's
the most the most valuable asset beside your home that
you that you have. Not unusual for a husband and
(38:19):
wife to come in between their four and one k
IRA assets pre tax money value of their house, seventy
to eighty percent of their net worth is in those
two assets. IRA in real estate your partner for success.
David kopekair WG WISE Retirement planning specialists, the Retirement Planning Group.
(38:45):
We understand that retirees face many important decisions that can
affect their long term financial success.
Speaker 4 (38:51):
Some of these decisions.
Speaker 2 (38:52):
Revolve around making investments that will help create a hedge
against outliving their assets, the impact of inflation, taxation.
Speaker 4 (39:01):
And rising health care costs.
Speaker 2 (39:03):
Most of our clients like the time, the desire, or
the experience to manage their own investment portfolios. We consider
it to be an honor and a privilege to help
our clients make sound investment decisions, though contribute to a
secure financial future for them. Because over ninety percent of
our clients are retirees with similar concerns, we are in
(39:24):
the best position to approach such challenges with experience and skill.
Give us a call today at five one eight, five
eight zero one nine one nine five one eight five
eight zero one nine one nine or RPG Retire on
the web. We run out of money in retirement where
your investments provide income for possibly decades. How do you
navigate the two greatest risk in retirement sequence of returns
(39:46):
in longevity At the retirement Planning Group. Our Bucket of
Money approach addresses these concerns and we offer a complementary
consultation to discuss this with you. Call our office today
for a free complementary consultation to develop your own personal
retirement income distribution plan at five win eight five eight
zero one nine one nine. That's five one eight, five
eight zero one nine one nine.
Speaker 4 (40:45):
The year we are back.
Speaker 2 (40:53):
I'm live in the studio, which is unusual. So I'm
here with my brother Zach, my engineer. My twenty fifth
year on radio, which is hard to believe, twenty five years,
my silver anniversary, forty three years in the business. I
can tell you, folks, if you're not doing planning for
(41:14):
your iras, you're doing yourself a huge disservice. You know,
there's different ways that you can reduce I talked about
the qu LAC. I talked about the charitable distribution. You
get to claim a charitable deduction, No you don't, but
(41:35):
you don't have to pay taxes on the distribution. So
there's different ways to slice and dice. It doesn't have
to be all or none. But you want to do
one thing for sure. You want to make sure that
everybody is on the same page, meaning that if you've
(41:57):
got the credit Union, you got the four oh one K,
you got the TSP, you get the four oh three B,
you got the IRA's, you got the wroth, and they're
all in different locations.
Speaker 4 (42:12):
That is a nightmare. That is a nightmare. You know.
Speaker 2 (42:16):
One of the things that I've said a million times over,
one of the greatest things that ever came out of
Washington was what the wroth wroth IRA wroth for one K?
Why is that?
Speaker 4 (42:31):
Well?
Speaker 2 (42:32):
Tax three, tax free, tax free pony up. You pay
your tax when you put it in, when it comes out,
it's all tax free distributions, tax free accumulation. And when
your loved ones receive the assets, yes, they're subject to
R and D even if it's a wroth at death
(42:54):
at the death of the second spouse the primary which
is typically the wife, right, But but it's all tax free.
So a lot of times when we sit down with
individuals and they're still in the accumulation side of their business,
(43:16):
make sure you understand the apple that you're creating. We
use E money. We just bought another software package that's
gonna compliment E money that was basically presented to us
the last time we were at a convention at Fidelity
(43:36):
in Boston. And to say that it's got bells and
whistles and sizzle and snap, crackle and pops an understatement.
It gives you a dashboard, what I call the dashboard
of your financial life where you stand. It can be
as in depth as you want it to be, and
you can keep it basically minimal as much much as
(44:00):
you want it to be. But basically you can put
your life in front of you. Not only as far
as your investments, your cash, your credit cards, your legal documents,
they have a vault. Think about the people. And I
(44:21):
can say this because I've lived it and I've seen it.
I've seen the horror on people's faces when they go
home and there's nothing there. Benita Beach, Fort Myers Beach,
South Fort Myers Beach, Carolinas. They go home, there's no house,
(44:42):
there's no legal documents, there's no safe, there's nothing. It's
all gone. How do you recreate that? Are you better
off basically having someone in the bullpen? If you do
the analogy of baseball, primary person doesn't go through, Yeah,
(45:05):
I gotta bring the bullpen in. It's no different with
your investments and your assets and your legal documents. I
am a huge, huge believer, especially with what I've seen
over the last few years, the devastation will. I've literally
seen homes that existed that I went down on Benita
Beach Road in Florida that no longer existed, that vaporized.
(45:28):
Nobody knew where anything was. It happened in the Carolinas.
It will happen again. It can happen up here. So
we can be as proactive as you want us to be,
and we can be as passive as you want us
to be. But the bottom line gets down to is
that I'm in the camp that this is a service
(45:51):
that I at the Retirement Planning Group, not Fidelity. They
give me the opportunity to provide it to you. I
pay for it for our client, but it allows you
to basically sleep at night and basically say, listen, if
something happens to us. I know where the beneficiary forms are,
I know where the trust document is, I know where
(46:12):
the will is, I know where the power of attorney
here is.
Speaker 4 (46:15):
I know where the health proxies are.
Speaker 2 (46:17):
I know all our codes and passwords in order to
get into all these accounts, is that your situation most.
Speaker 4 (46:22):
Of you absolutely positively, not.
Speaker 2 (46:26):
Absolutely positively, not if something happened. So you know, I've
seen a lot in forty three years being in this business.
The one thing that I haven't seen, I haven't seen
anything yet where I walk into a situation where everybody's
(46:47):
buttoned up. There's always what I call the holes in
the boat, a few things that need to be fixed,
and that's all right. Some people think that they're in
really good shape, and a lot of times they are,
it's just they need minor adjustments. So if you're in
(47:07):
a situation that you have a lot of money and
qualified plans, if you're in a situation where you feel overwhelmed.
Speaker 4 (47:19):
That you need some.
Speaker 2 (47:20):
Kind of a plan in place when the first spouse
passes away. If you're in a situation where you've got
a lot of money and qualified assets, you put your
house into a trust, and you think that you know
you're in pretty good shape. Well maybe you are, depending
on the zip code that you live in. But if
you're not in a zip code that protects IRA assets,
(47:43):
you could be in a whole lot of hurt. It
could be a lot of money that goes down the road,
because if I need to write a check in an
IRA for one hundred thousand dollars, I might have to
write a check for one hundred and forty one hundred
and fifty thousand dollars depending on my tax bracket to
get the net result, because that IRA four oh and
K four O three B all that pretax money is
(48:05):
taxes ordinary income. So it's it's a slippery slope. Everybody
has a different way that they want to have their
assets managed. You know, I've said this a million times.
It's been proven over and over and over again. Whether
it's Fidelity, Vanguard, Schwab, any of your major investment banking firms,
(48:30):
whether it's Merrill Lynch, they all say the same thing.
Working with a financial team will help you, It will
be beneficial, and the net result will be better for
you and your family. We don't claim to have all
the answers that the retirement planning group, but what we
do is we sit down and have a chat with you.
(48:50):
First appointment, we do nothing. We just have a conversation.
Second appointment, we come back with ideas and recommendations, and
then you go home and think about it in the
If you're ready to move forward, we start implementing the plan.
Implementing the plan. One of the hardest things that I've
(49:12):
dealt with in all the years that I've been working
in the financial services business is walking into a house
when one of the spouses has passed away. Because you
you know, our clients become like family to us. You know,
it might sound kind of corny, but it's the truth.
And the thing is is that the last thing that
(49:34):
we want is for that spouse, whether it's the male
or the female, to worry about that things are not
put together, buttoned up. So if you need help, you
need assistance, that's what we're here for. We got five
locations down New York, Syracuse, Albany, Multi Slash, Saratoga Springs,
(49:56):
Oniana and Glen's Falls. If you like to come in
for a consultation, it's pretty easy. You can just give
us a call. Five one eight five eight zero one
nine one nine is our primary telephone number. Five one
eight five eight zero one nine one nine. You can
check us out on the web rpgretire dot com, rpgretire
(50:20):
dot com. And again, as I always say, you know,
whether it's us or someone else. Ninety nine point nine
nine nine percent of the financial advisors out there are
working in your best interest. You'll never hear Dave Kopek
(50:42):
or anybody on my team talk negative about other financial advisors.
It's a tough business. It's also a business that can
give you great rewards. So again, if we can be
of assistance, it would be an honor. Again, our telephone
number is five one eight five eat zero one nine
one nine. You can check us out on the web
(51:03):
rpgretire dot com. And here's the most important question of
the day. Who wins today? Who wins?
Speaker 4 (51:14):
Florida and Duke?
Speaker 3 (51:15):
Even though I want Alabama.
Speaker 2 (51:18):
I think Alabama wins. I think Alabama wins. And who's
Florida playing against? Is a Florida Alabama?
Speaker 3 (51:33):
No, Alabama's playing Duke. And the only reason I picked
Duke is because Duke I've seen played defense would need
to be Yeah.
Speaker 2 (51:41):
No matter who wins, it's going to be great, great,
great basketball. So again, folks, march madness, everybody have an
absolutely fantastic weekend. If we can be of assistance, it
would be an honor. Give us a call five win
eight if five eat zero one nine one nine. And again,
if you want to check us out on the web.
Are pg retire dot com. It's just our pg retire
(52:06):
dot com. Be safe and have a great weekend.
Speaker 1 (52:12):
Thank you for listening to Retirement Ready, hosted by Dave Kopek.
If you would like to talk with Dave or someone
at the Retirement Planning Group, called five one eight five
AID zero one nine one nine. That's five one eight
five EID zero one nine one nine during business hours,
or visit rpg retire dot com. The Retirement Planning Group
has five convenient offices located in Albany, Malta, Glens Falls, Pontiata,
(52:37):
and Syracuse. Tune in again next week at noon for
Retirement Planning Strategies with David Kopek, or Saturdays at seven
am for the Retirement Planning Show.
Speaker 3 (52:47):
The information our services discussed on this show is for
informational purposes only and is not intended to be personal
financial advice.
Speaker 4 (52:53):
The investments and services offered by us may not be
suitable for all investors. If you have any doubts as
to the merits of an investment, you should seek advice
from an independent financial advisor.
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