Category: Alliant Webinars

Evening everyone. Uh looks like we still have a couple of minutes and we’re having folks still log on. So we’ll give it a couple of minutes and then we will start pretty close to 6:00. Maybe maybe to give it a minute or so after that. I am not sure what part of the country you are joining us from. It was a uh we had quite the storm event. I was worried there. It knocked out the power and internet to our building here. So, I was worried that it might might have impacted this webinar, but fortunately, we have power and everything’s back on and I just heard back from the boss and everything is good at home. We were out for a couple of hours there. Ah, Florida. I heard Florida got hit right now. I was talking to uh one of our clients out there and they said that it I mean Florida is a big state so I guess it depends where you’re at.

North Carolina. Nice. Miami. Uh she was not in Miami. So

hopefully the weather is nice there. It is it is stormy here and it is warm and it is about 10,000% humidity right now. I think the only ones that are happy are the mosquitoes and maybe the alligators out here. So,

but I can tell you for a fact my dog is certainly not too happy about this. All right, what time do we have? So, I have six o’clock straight up. It looks like maybe we’ll give it one more minute as people are still logging on here.

We’ll still have some time for Q&A at the end.

Okay, I think in the interest of time, we are going to go ahead and start. Hopefully everyone can see the screen with my smiling face on there for the slide. Uh, thanks a lot for joining me for tonight’s webinar, Social Security, Choice of a Lifetime. Uh, if you’re joining for the first time, a special welcome. I’m Michael Marx, certified financial planner and a financial consultant with Alliant Retirement and Investment Services, or AIS for short. I live here in Houston, Texas, and I’ve been doing this for over 30 years now. Um, most of my family has worked I’ve told the story before, but for those of you who have not heard it, most of my family has worked for either United Airlines or Continental since the 1960s. So, I’ve been tied to Alliant longer than I’ve been alive. And for any of those who may not know, uh, Alliant was the original credit union for United Airlines. And, uh, last year they celebrated their 90th anniversary. So, I know some of you may have come through different channels. So whether it’s United or Continental or Google or Tesla or CVS or Susie Orman or many any of the other many segs that we have happy you’re here. So just a quick just before we dive in just a quick housekeeping item. So this evening session and all of our sessions are for educational purposes and includes proprietary material. So to protect both the content and everyone’s privacy that we ask attendees please not record or capture the presentation whether it’s by video, audio, screenshots or AI tools without prior consent. That’s from our lawyers so I’m reading that. Uh we appreciate your understanding and we are glad you’re here. So uh and I am not sure what path brought you to our webinar this evening. Uh so if you join this webinar via an email that you received directly from us um or the marketing department or signed up right on the credit union’s website, I’d like to just take a couple of minutes and talk about AIS. Uh in addition to the weekly webinars that we host, we offer uh full service wealth management and investment planning. Uh we’re fiduciaries. I’m a CFP. Uh we offer a broad variety of investment options ranging from fixed rate guaranteed to as aggressive as you want to be in the market and everywhere in between and maybe even a little bit of life coaching when it comes to your retirement years. Uh we’re actually a very good resource to utilize. Um as I said we offer multiple webinars throughout the week with different presenters. Each of us usually hosts twice a month. Um I’ll do one in the evening and one in the afternoon. So, our goal is really focusing on helping you understand the ins and outs of investing and saving for retirement, becoming much more informed and making more informed decisions. So, I encourage you to take a look at the resources available to you uh at our website. Uh that’s eris.alliancreditun.com.

Um or you can just uh find us right on the upper right hand tab under the investments tab right on the credit union website. So we have our weekly webinars that list there um our podcast invests savvy uh our blog and some other financial resources. So speaking of webinars my next webinar will be called anatomy of a recession. I’ve done these in the past. So, we’ll talk about recessions from a historical perspective and how they might apply to our current situation. Um, and I’ll sprinkle in some of the current events such as like Fed rate cuts or potential hikes. Uh, some tariff impact on some of the shutdowns, maybe some of the government decisions going on out there, the war, etc. that will be in the afternoon um on Wednesday, June 17th, 2:00 p.m. Central and 3:00 Eastern time. I think this is especially relevant and kind of an ongoing topic, right? Because things seem to be changing every day for us here. Uh I usually try to do these a few times a year past just to kind of catch everybody up on what’s kind of going on out there and the pulse. Uh so and then I’m back in the evening talking about Roth conversions. And that’ll be Tuesday, June 30th, uh 6:00 Central, 7:00 Eastern. Um we’ll be talking about Roth conversions and how they might be a part of your long-term retirement tax strategy for your withdrawals. All right. So today’s presentation, it’s focused on how to maximize uh what is for many the single most important monthly paycheck they’ll receive in retirement, their social security benefits, right? Um so there there’s a lot to it. So I want you to come away knowing that social security benefits provide a protected level of income um and they can’t be outlived, right? So a basic understanding of how that works. Um, so before we get into some of the details, uh, it can be complicated as far as social security goes. So you’re not alone if you feel that way. This is a great opportunity to work with your adviser or retirement specialist or someone at Aerys. They can really help you lay out a solid foundation for a solution that works for you under your personal situation. So again, material is it’s not a recommendation to buy or sell any financial product or adopt a particular investment strategy. Uh I would always say that everybody’s situation is unique. So you really want to discuss your specific situation with with your adviser or trusted professional. Um now kind of generally speaking right when you claim it can make a huge difference. So the assumption here is that this person is making about 54,000 a year and their full retirement age is 67. Uh and which most of you who are on this call are probably full retirement age of 67, but we’ll we’ll show you a chart where where yours would be if you are born earlier than 1960. and not already retired. U but as you can see that difference between the earliest you can take social security and the latest you could take it is a 77% difference. Um so obviously maximizing is really hey maybe I should just wait until longer but there’s really a lot of moving parts and things you should consider but that is really kind of the basis of our of our webinar tonight. So, social security our agenda is choice of a lifetime some of the social security basics and guidance built for you. So the uh first one we’ll talk a little bit about. So most people, not most, that’s not true. Many people file at the earliest possible time, right? So these are like these are the percentage of new social security claimants in a calendar year. So as you can see, if full retirement age is sometimes 66 or 67, almost half of claimants file early. Now, that’s kind of significant um because they’ve done studies on this and they found especially in that 63 to 65 category, that second that second bar, a lot of those people didn’t plan on retiring that early, but they were forced out. So, it was either due to health reasons, either their own or having to care for a loved one or something happened with their job where it was eliminated and they were laid off. Um, but they originally wanted to wait until their full retirement age. So, this is really more of kind of a cautionary tale when it comes to retirement planning as part of your whatif scenario. That’s one of the things that we run, right? What happens if you’re forced to retire early versus your goal? um are we still okay to have that little bit of peace in mind? So, so with that, just be mindful of that. If you haven’t built that in your planning, we could certainly help you with that. Uh if you have, you’re ahead of the curve. So, let’s take a look at an example. So, the benefit at So, the benefit at FRA, which is full retirement age,

So the scenario here is the age where Pat and Kelly, right? Pat’s 66 um and Kelly 61 and those are their social security benefits at full retirement age. So when they’re looking at their cumulative benefit, right, and the and the assumption is so so this is always the assumption, right? If you know one of the f one of the biggest factors is knowing when you’re going to die, which clearly no one knows. So they use averages. So for men in this scenario they used 85 for men 88 for women and a cost of living uh adjustment or cola from social security at 2.4%. So what they said is they said, “Hey, look, if we if we file as soon as possible, our total lifetimes, we’ve taken in just over 1.1 1.5 million in social security benefits. Where if they tried to optimize these benefits, it would be closer to 1.8. So over $200,000 more in in total benefit from Social Security.” Now I will tell you and I’ve talked to many people about this who have done these things are trying to find the perfect timing on when this is done. So we use software and we say hey this is when we think if you’re kind of optimizing when this should be and you estimate when you’re going to when you’re going to pass away what your benefit will be when you’re planning on taking it and then we kind of make some assumptions some assumptions there. Now there are different calculators out there that might give you a different target. though it’s based on some of the assumptions that are built in. But I would say this and and I would say that this is really really important um that since we don’t know when we’re going to die, I I’ve seen people really struggle with trying to find the exact answer on when’s the best time to take social security. And it’s really not just about the age to maximize. And we’ll talk a little bit about that because the computation of retirement based on survivor benefit is really complicated. So I actually want to read you a quote from directly from the social security website. It’ll take about a minute or so and basically it describes on describes how they calculate it. So this is what it says. I should have made a slide on this, but what it says is the formula used to com compute the family maximum is similar to that used to compute the primary insurance amount. The formula sums four separate percentages of portions of the worker’s PIA, which is your primary insurance amount for 2026. These portions are the first 1,643 between 100 1,643 to 2371 and then the next one is 2371 to 3093 and then the amount over 3093. And what they’re going to do is they have bend points. And this goes on to say, hey, you get 150% of the first bend point, 272 of the second, plus 134 of the next and 175 of the next. and then it’s rounded to the lower 10 cents. So really there’s no way to actually fully estimate it, right? You just have to say, “Hey, look, roughly we’re going to go at this age.” But but that’s why, you know, god forbid when someone’s spouse does pass away. The best exact dollar amount is really cuz you have the date of death, you knew when it was drawn is to actually run it directly through uh social security. But with that said, not to steal our thunder, we can at least help you give you an idea on that. So,

while this is important, nobody really knows exactly when they’re going to die. So, again, while important, I think there are other factors you’ll want to consider when looking at the timing of your social security. Well, we can give you some ideas on the age when you maximize it, right? based on when you think you might pass away or average mortality, but frankly things like your retirement plan as a whole, right? What does that look like? What do you want to do? What are those goals? Your cash flow, your assets, and how your assets are allocated, your health, health of the spouse, your age when you’re looking to take this, and what your taxation, you know, a few others. So, but that’s one of the many benefits of working with an adviser. So we’ll look at a little different scenario, right? So someone who’s not married. So and this is just an example of the range of the total benefit that received from social security based on when you take this. So Mary is age 60 and her full retirement age is 67. As you can see, her social security benefit would be $1,236.

So, if she files as early as she can, her cumulative benefit would be just over $350,000. Now, if she waits until full retirement age, it’s $432,000. And if she waits until the maximum, it’s $478,000. Um and again life expectancy for women since it’s Mary uh it would be 88 years old. Now I can tell you kind of as a general general general general rule if you expect to live past 81 or 82 for total dollars from social security you would be better served waiting until age 70 which is your maximum social security benefit. do not wait a day longer because there is no advantage to that benefit. Now, I will say both these slides use the word lost, right? Cumulative benefit loss by filing early, but and that’s just regarding your total dollars received, right? But what you do gain is the use of those dollars earlier, right? So that gives you the option to either reinvest it in something potentially more lucrative or you can spend it making retirement memories with your loved ones, you know, while your health permits. So everybody is different. This is a very much individual thing. Uh and that’s one of the things that we talk about when we’re doing planning for the members here as far as hey, what does that retirement look like? What does your cash flow look like? Do we need this earlier? Do you have the life expectancy for that? Because is there an age difference, right? Because it also matters on the death benefit side. So, and I don’t want to minimize the importance of having a social security withdrawal plan. You know, as you can see, for most people, social security makes up the lion share of their retirement income. So, that’s why it’s important to have a withdrawal plan before you retire. Uh actually, it’s probably a good idea to have a withdrawal plan a few years before you actually retire.

So the basics. So let’s talk about some of the basics with a little history lesson on there. So what does social security offer? Right? It offers a lifetime income, right? So it’s a lifetime based income. So you won’t run out of income. It is indexed for inflation. You’ll see it called COLA when they talk about it on the news, which is a cost of living adjustment. Now, just know historically it doesn’t quite keep up with inflation over time. So, that’s why you usually have a retirement plan with multiple income sources. It provides some survivor benefits for those who are married or even if you’re divorced, but you were married for more than 10 years. uh you know so if your spouse passes away uh and there’s some pref preferential tax treatment so some or none of your social security could be taxed depending on your total income I can tell you as a general rule most everybody on this call some of it or up to 85% of it will be taxed because you have to have $25,000 or less in income for it to be not non taxed taxable. Um, and for married couples, it’s 32,000. Oh, but social security wasn’t always around. So, it’s actually less than 100 years old. If you remember learning about the crash of 29 and the Great Depression that followed, right? That event created the law that created social security. Now, it created 11 years later, January 31st, 1940 to be exact. um and Ida Fuller was the first recipient um to receive a check for social security. Now, you can’t see that check amount, but um if we were actually in person, I would have some people guess, but so that check amount. So, you can go ahead and guess in your head that check amount was $22.54. So, I don’t know how close you were on your guess, but I’m not sure $22 was still a big amount even in 1940. So, um, what determines someone’s primary insurance amount, which is PIA, right? So, you’ll hear that. And basically what it is is it is your highest 35 years of wages up to the maximum each year. And if you look at your payub, right, not that we really get past payubs anymore right now that everything is electronic, but you’ll notice something called FICA as one of the line items as far as your tax, your taxes on there. Um, and what that is is that is a tax that includes social security as well as your Medicare. So that total amount is 15.3%. You pay 7.65, your employer pays 7.65. And of that 7.65, 6.2% goes to social security up to the maximum. So the maximum income this year is 184,500. So if you make more than that, you are only paying that 6.2% up to that max. And it changes every year. It increases every year. So they’ll look at your last 35 years and that is what qualifies you for how much of your benefit. You do not have to work 35 years. You only have to work 10 years to be eligible for it. But they will take the last 35 years. Many of us work for much longer than 35 years.

If you haven’t, I encourage you to sign up with Social Security so you can see your specific benefits as reported on your income over your working life. It’s secure. It’s free to do and it’s really easy. So, you’ll want to go to the Social Security website, create that account, and what you can do is you can also see and make sure that the that two things, no one’s making claims on yours, and also uh they’re reporting the right income.

So, your social security statement. So, they used to send these out at regular intervals, but in the world of saving money and in the electronic world, you’ll have to look online now if you are 60 or under. Um, for those of you over 60, you receive them annually around your birthday. And what that does, uh, it’ll tell you, hey, what your estimated benefits are. So, the assumption is, by the way, on this is that you will continue working up until retirement. So, if you do retire early, uh it might adjust that a little bit. So, we’ll talk um here is that chart that I had talked about as far as when you’re eligible for full retirement. And this is the amount that you receive without a penalty or a bonus, right? So, if you wait until later after your full retirement, you’ll get 8% more per year. Uh and that what that allows you to do is allows you to work without any reductions in your benefit. So, like I said, most of you on this call, your full retirement age is probably 67.

So, here is a great example of taking social security early versus waiting until you’re older, right? So, the full retirement in this scenario is 67. And as I said, for every year you wait, you’ll get an 8% increase on that benefit, including the COLA, too. So that is something to consider when you are when on the timing as far as your social security goes. Now if you take it early there’s a couple of things right as you can see there’s some deductions on that you’ll get 93 or 86 or 80 but also you have an earnings limit too. So if you earn over a certain amount those benefits will be reduced even further but it’s not a total loss. when you hit full retirement age, they will recalculate it. So, so filing rules are different for situations. Uh, so some of the surviving spouses, spouses, divorces, dependent children, government employees, etc. So, let’s take a look. So, spousal filing rules, these are pretty straightforward, right? As I said, you are eligible at 62. uh you have to be married at least one year. Uh and one spouse can file for the other to claim their benefits, right? So you can claim your spouse’s benefits or your spouse can claim yours. You’ll get the higher of those two. This includes samesex couples. They changed that law a while back. Now, your benefit, if you’re trying to claim your spouses, your benefit is 50% of that. So, for example, if my social security were 4,000 a month, my spouse would be eligible for the higher of hers or 50% of mine. So, that would be $2,000.

Now, surviving spouses, right? So, you have to be married for at least 9 months. Now, it says at least for 9 months, unless the death was an accident, and you can take your benefits as early as age 60 on this. So now there are some things where it says currently widowed. Uh now if you remarry you are not eligible for that social security unless your spouse’s social security unless you marry after age 60 then you are still eligible for your former spouse’s uh social security. Now some of the benefits right you’re it’s up to that PIA which is that primary insurance including the delayed retirement credits that they earned right so if they delayed that um and survivor benefits they can they could be received independently of the individual benefits. So this kind of matters, right? So one of the things that we look at is that if you’re trying to delay and and there might be a a life expectancy issue, right? Sometimes delaying for the higher earner, it’ll be helpful to the surviving spouse later on because you’ll actually get that delayed credit. So divorce spouses, these are always fun. So

um you had to be married at least 10 years and you cannot have remarried. So now the expouse doesn’t have to file beyond those two years after the divorce, right? So, um, you know, so in theory, if I were married at 20 to the love of my life, and then I’m divorced at 30 and I’m married to the new love of my life, and then I’m divorced at 40, and I marry the new love of my life, and so on at 50, and so on at 60, uh, and so on at 70, and then I’m my new love of my life. So, all five, 20, 30, 40, 50, 60, 70. So all six of those spouses are actually eligible as long as they didn’t remarry, right? Or wait until they are after 60. They are all eligible to claim my social security or at least part of my social security. And and they’re all independent, right? So it won’t impact my benefits and it wouldn’t impact any of my ex’s benefits.

So that was a big one for Johnny Carson or Elizabeth Taylor if anyone are old enough since I don’t know how old people are on this thing or if I just completely dated myself there. Um so how working impact your social security right so this so this matters right so I talked about if you retire early one of the things is that there’s a reduction in that benefit so if you’re under your full retirement age so for most let’s say it’s 67 you’re like you know what I am done I’m going to retire at 65 well you can only earn as you can see $24,48 80 for the year. Now, for every every dollar you go over that, right, you get $1 withheld. Now, now it says on that annual limit. So, for the year of your full retirement age, so like my birthday’s in November, so from January till November, even if I’m early, then every $2 it’ll be reduced by a dollar. So, um I’m sorry, it’s reduced for every $2 over it’s reduced by a dollar. Once I hit the year of my full retirement age, then for every $3 over um and then that limit is higher. So once you hit full retirement age, you can earn as much as you want. And yes, Johnny and Liz, bravo. Thank you for at least acknowledging that one. Um at full retirement age and beyond, you can earn as much. There’s no earnings limit. So, frankly, what we tell folks, hey, look, if you still have that life expectancy, you know, um it’s probably not a bad idea to wait until full retirement age, assuming you don’t need it. Like I said, every person’s situation is very unique. So, that’s why we work with that and we talk about potential situations and scenarios that you would look at. So, let’s talk a little bit about some guidance built for you. We’re doing fine on time here. So, let’s just look at some of the filing strategies, right? So, what this does, we’re going to show you a couple scenarios where it just says, hey, you know, these cumulative benefits that are optimized strategy versus filing early and some alternative filing strategies. So, you can compare those and how to maximize your social security. So, what you’re basically looking for is your break even, right? And Social Security used to do this on your on on the statements that they sent it out. And I don’t even think they do this on the website anymore. It’s it’s been a few weeks since I looked at mine. Um, but what they used to say is they said, “Well, if you’re expected to live beyond this age, you will get more. If you think you’re going to die before that age, then it’s probably better that you take it earlier.” Um, so what this chart shows is the earliest and suggested and right where those lines meet down at the very bottom there. Um, Pat and Kelly’s on the vertical and that horizontal is right where that break even. So that’s somewhere for Pat on the bottom part somewhere around 87. And for Kelly, it’s probably looks like around 86. It’s not an exact right there, but um but basically for Pat, if he expects to live to 90, you would delay. If he’s like, “Look, I don’t I don’t really have that life expectancy in my family,” then you would probably take that maybe sooner.

So, optimal strategies and I always, and again, this is just for total for total dollars received from social security. So in this scenario, right, the expected lifetime family, we’re going to go back to Pat and Kelly for that entire strategy is a little over a million dollars, right? So in this scenario, they would say, well, Pat should wait until 70 and that way his benefit would be about 36.96 where Kelly, she should file it around 66 and her benefit would be 1744. And basically what that looks like is she would get hers early, right? And then they would get theirs and then he would pass away and then she would get the death benefit. So that’s essentially what that chart looks like for you. But that’s kind of what this looks like. This is a little better idea of looking at it than the chart, but you know, you’re looking at an income gap, right? When a spouse passes away. So, I mean, obviously, we don’t know when we’re going to die, but you can use your own health or your life expectancy of your family to kind of create just a general strategy on that

and we’ll give you some ideas based on that, right? We have software that’ll say, hey, you know, roughly this is when you should take this. This is, you know, just based on those numbers and this is when your spouse should take that. So, um, look, when and how you do this is really an important decision, but I would probably argue that it’s not the most important decision, or at least it’s maybe a 1 A, 1 B, 1 C, because there’s a lot of other things that you should factor in, right, as far as how how much you need the money and what your retirement looks like, right? Um, we’ve talked to people um where they did delay, you know, we talked to members of all ages here where they said, you know, I mean, yes, I got more money now and that’s really good, but frankly, in hindsight, would I have liked that extra money a little earlier even though it was less because we might have been able to do some of those things that we wanted to do, right? travel at 70 may not be as easy as travel at 65 or 66 or something um or 67. So, it really is an individual thing, right? So, learning how claiming those benefits impacts not only you but as well as your family members, right? Your spouse um and how we can put those filing rules to work to maximize what works for you. And maximizing, frankly, might not be the biggest dollar amount, right? There’s there’s a lot of moving parts to retirement planning. So consider your filing decision within the big picture of your overall plan and we can certainly help you with that. So um with that how we can help. We’re coming to the end here. U there’s a lot of things that we can do and it takes all hands right both yours trusted advisor and maybe any other family members that are involved. So we covered a lot today. So what I would tell you is how we can help as far as life planning. Um, and it’s basically questions to help you imagine your retirement, right? So, even if you haven’t given it much thought or you have and you’re kind of stuck, we have the benefit of talking to hundreds if not thousands of members over the course of my career. So, it’s much easier to say, hey, you know, this is kind of how a lot of others have done that. And I don’t know if that applies to you, um, but at least we’ll give you a good baseline. The other thing we can do is budgeting, right? And that is one of the things that we do here. We usually work with folks and say, “Hey, you know, this just get an understanding of your cash flow now and how you think that’ll look different in retirement.” And we’ll talk a little bit about what normally happens uh in retirement for like spending habits because it does not always go up. It usually goes up and then it comes down and then it goes back up again. We can help you with the account management, your asset allocation. We have access to investments here that you probably do not have access to out there in the regular retail world whether that is through you know like the Fidelities or the Vanguards etc or even the JP Morgan Chasees etc. So I think you’d be remiss to not look at what we can do here and obviously our portfolio management it’s really the broad range and we are cognizant of tax considerations when we’re helping you make those decisions. So I want to thank everybody for attending. Um we have some time for questions. If you have any questions go ahead and type those in the webinar chat or the Q&A box. Uh what I will do is I’ll put up a quick one question survey. If you would like us to give you a call and schedule some time for us to look at your particular situation, let me know. Or you can just take a picture of that QR code on the screen and that will give you a um it’ll give you access to my calendar. And oh, if you’re doing that electronically, by the way, it only lets you do that during regular business hours. So, if you do need to talk to me outside of business hours, just shoot me an email or something and um or give me a call or just put yes in there and I can give you a call and I’ll be happy to accommodate you as I can. It looks like we have one raised hand out there. So, we actually don’t do the audio on this. Forgive me on that. So, if you would mind just uh going ahead and typing that question in, I’ll be happy to answer that. So social security. So the question first question is we have a few them out there. Social security is taxed at 10% up to a certain amount. So what social security is social security is part of your regular income. So if you have other sources like retirement like IRA um or part-time work or pulling money from your 401k that goes to it. So it starts at 10%. And then it can go up to there. But in theory, if you make enough money, you could be taxed at the highest tax bracket of 37%. Plus the 3 uh what is that excess tax? 3.8%. So I mean, you could pay up to 40 almost 41% on that. Um, next question. Any suggestions on saving tax if you cash in a whole life policy early, not annuities, please? Okay. Um, so generally speaking, if you cash that in, right, your cash value, depending on how long you’ve had it, and I can take a look at that if you just say, “Go ahead and give you a call. We’ll take a look at it.” But generally speaking, oh, hang on. Let me give you let me give you a a disclaimer. Please consult your CPA or or tax attorney or other tax professional since we just give general advice. But generally speaking, when you’re looking at that, um, it’s over your cost basis. So, for example, if you have $50,000 in there, but you have paid $40,000 in premiums over the course of your life, you actually don’t owe the tax on the 50,000. You only owe the amount over your cost basis. Uh so, let’s see on that. Hopefully, that answered the question. For the first year of retirement, how are you taxed when there’s part of the year working income and part of the year social security? Say half and half. So, still it’s cumulative income, right? So, easy math. You make $100,000 a year and you work half the year, you’re going to get you’re going to have to show taxable income of 50,000. And if you draw on social security for half of the year, you’ll get that for half of the year. Uh, if I keep my adjusted gross income at 25,000 or less, I won’t have to pay taxes then. Uh, well, yeah. So, so as far as social security, it’ll be it’ll be zero at that at that point. But again, without looking at anything else. Yes. Uh, all right. Let’s we have a few more. Bear with me for a moment. So, 65, was married for 20 years. Your ex-husband was 5 years older than you are. Can you start taking a social security and then at 67 start taking mine? You are

20 years. Your ex-husband for 20 years. my ex-husband was 5 years older than me. You should be able to apply for his because you were married for for that, but it depends. You’re still supposed to be full retirement age on that, but you are eligible 65, but I can double check. Um, Lisa, if you want to just go ahead and change that to yes, I’ll do the research on that and double check for you there. Um,

yes. Yes. So your social security it’s actually half of your social security uh is part of your income for that part B on that question. Any comments on social security solveny? Yes. It is supposed to run dry uh in 20 not 2024. It’s actually late. Oh yeah 34. Yes. I was like no it’s later than that. Um so a couple things on this. Yes. I have a lot of comments on that. So but I’ll I’ll be brief in the interest of time. So I do not I am not worried about the solveny of social security at this point. And for the simple reason is that the assumption is if absolutely is nothing is done. Um and there are many things now it is great great they’re great talking point for ringing up your base if you are a politician. However, this is what I would say cuz I’m a big fan of behavioral economics, right? And I’m going to jokingly say this. So, if anybody’s a politician here, my apologies or has a family member, but what is the first job of an elected politician? To make sure you get to make sure you get reelected, right? Um, and make sure your party stays in power. So, nobody nobody wants to be the one responsible for social security failing. Now, with that said, there’s some very very very easy changes that can be made because I know one of the things are floating, right, is a 25% cut um in benefit. And that’s that’s really unlikely, right? That would be a really huge strain on a lot of retirees. So, what they most likely will do is they will simply start bumping that age up, right? So right now it’s full retirement age is at 67 but there’s nothing that could be said at a certain age or certain generation to say hey it’s going to be 67 12 or 68 or the other thing they can do two things that would make a huge difference and shore up a lot of this is increase the social security tax right you remember that 6.2 even if they went to 6.25% to five% collectively in a country, it would make a huge difference. And since it’s pre-tax, most people, not all, but most people wouldn’t notice a significant decrease in your actual take-home pay. Um, the other thing that they could do is simply not cap it, right? If you make a million dollars a year, you’re still going to pay that 6.2 all the way up. So, they can raise the caps. and raising the caps would probably be the most would be the most uh logical one at that point, right? If they raise the cap because even if they go because then then some of the lower income wouldn’t be impacted by that because the way social security works is the lower your income, the larger percentage of the benefit which is who they’re really trying to shore up, right? Because the assumption is those folks who are more fluent. I’m not saying you’re rich and the millionaires and the billionaires etc etc but this is really just kind of where social security as far as in the spirit of where it came about is they were really trying to make sure that people weren’t in poverty. Uh and it’s just really a part of your social retirement picture. Hopefully that I know that was a very long-winded answer and my apologies for that. Um are they raising the cap every year? Yes, they do raise the cap every year. Uh, I’m retired, have Roths and pension will be 79. It’s important to continue to save for in retirement accounts. Well, I have to start making deductions at 70 making distributions. I assume you mean at 73, you probably if you don’t have any regular IAS, you wouldn’t be forced if you only have Roths, you’re not forced to take distributions out because that’ll just go to your beneficiaries. Um, if I missed that or if it was something more specific on that, just go ahead and I can give you a call. For the courses offered earlier during the day, am I currently working? Are they recorded? Oh, I am so sorry. They are not. These are live. Um, it’s a compliance issue. We had asked about actually just posting these out there. But I would say this, um, what we can do is if you’d like, just go ahead, if you’re not one of the yeses on there, go ahead and change that to yes, and we’ll actually look at your situation. We can do something after hours. No problem. I understand life gets in the way, so I will do my best to accommodate. Um, someone just said yes and someone said I will be 69. So, oh, 79 versus 69. So, yes. So, you’re talking about your RMD. The rocks do not have an RMD. It’s only IRA and 401ks, assuming you’re not working anymore. If you’re still working, then then you don’t have an RMD on your 401k. So, let’s see. What am I missing? Make sure I did not miss any. Those were great questions, by the way, everyone. Thank you so much. It makes this much, much better when it’s interactive. Frankly, I love the inerson stuff, but it is the digital world that we live in now. Um, so with that said, it looks like all the questions are answered. I will hang around on here for a little bit if there’s any Oops, hang on. Party can suspend their social script and take their spouse and apply for them later. Uh, to a degree, you can do a suspend, but they actually did a change on that. So, they just changed that law a couple years ago where u if you do take it, it still counts toward when when it was taken. So, it’s not it’s not as robust and advantageous as it used to be. Um, all right. I think that is everything. Thank you so much for attending. Um, if you have any questions, feel free to give me a call or shoot me an email. I will be happy to help you in any way we can. I hope to see everyone on future webinars. Thank you so much. Be safe and enjoy the evening. Take care. Bye now.

Good evening everyone. Thanks for joining. Uh gonna get started about one minute after the hour. Today’s uh a little bit longer of a presentation, so not as much leeway can be given today. Uh if somebody does not mind hopping in the chat or the Q&A section, just let me know that you can hear me. We got a quick mic check. I’d really appreciate that. Perfect. Thank you very much to everyone. Thank you. Thank you. All right. Great. Like I said, we’ll get started here in about three and a half, four minutes. That way can get through it. But today’s webinar is great. It’s one of my top two, three favorite ones to present. A lot of information. Um wouldn’t say that there’s really any downtime in it either. A lot of great scenarios to go through, a lot of information to be learned. Um we’ll get into it. Might even want to grab a pen and paper for this one. But of course, you know, you can always schedule a meeting with me after to review the information. We’ll get started here in about three minutes. Right folks, we’re going to get started in about 30 seconds or so. Anybody who’s running late, experiencing technical difficulties, give them an extra second to join in early on. Again, if you didn’t hear my spiel about 3 minutes ago, today is a great webinar to show up for. Uh top two or three favorite one of mine to present. A lot to be learned. Um you know, a lot of folks join these webinars. They want to know if they can retire on time, how much they need to save, etc., etc. And that’s simple to show with financial planning. Um, this gets into a lot more than that. Gets into the taxes and the weeds of things. So, just be prepared for a great webinar today. It is longer. So, we’ll be getting started here in just a second. But again, thank you all for joining. Hope you learned something. I’m sure you will. All right. With that, let’s begin. So, good evening everyone. My name is Beep T Sprreer. I’m one of the financial consultants with Alliant and I’m part of the team of financial professionals through the credit union that just offer webinars and educational seminars on a regular basis to educate our members. You guys are our boss. This is why credit unions are better than banks. Not owned by shareholders, owned by you, the members. Of course, all the other perks that come to with a credit union, too, but we’re here to just assist our members and give you the best experience possible. And again, like to just start thanking all of you for taking the time to learn about taxes in retirement, ways to save money, how to avoid some very costly mistakes, and of course, as always, I will reserve time at the end to answer any questions you may have. If you answer ask any during the uh webinar, I can’t get to them just yet cuz I will be on a roll. But feel free to pop any questions you have in the chat or the Q&A section. Two different areas you can ask questions. Go ahead and identify both. But when that time comes at the end, ask your questions in those sections. I will be sure to get to them. New disclosure that we have here. Uh some people have been putting their AI notetaker in the meetings. Sorry, this is proprietary information. We can’t allow people to do that. I don’t think I see any in here right now. So, please don’t put your AI noteaker in here. If you want to take photos with your camera, I can’t stop you from doing that. But feel free to ask any questions, take photos. Again, can’t stop you from doing that, but no notetakers.

All right, upcoming webinars, state matters, state planning. This one ties into today’s, too. So, we’re going to cover a little bit about estate planning. Want to really get into the weed up weeds of it? There it is. Thursday, June 11th, 2:00 Central, 3:00 for you Flidians and my East Coast folks out that way. And then another thing we’re going to be touching on today too because it does assist you with tax preparations, saving money in taxes, Roth IRA conversions. This is another one of my top two top three favorite webinars. And that will also be at evening webinar Tuesday, June 23rd. Please join us for that one. And of course, our team at Alliant Retirement Investment Services. We are focused on helping you, our members, understand the ins and outs of investing, retirement, being savvy with your finances, of course, much more. Take a photo of this slide. Oh, boom. Sorry about that. Please go ahead and take a photo of this slide. Check out our webinar schedule, aerosis.allantcreditun.com/event.

Then we have our podcast. We also have a plethora of other resources that you can check out as well on there in our resource center. All right. So, before we dive into our presentation, we’re just going to warm up with a little bit of a tax brain teaser about Bill here. Sounds like fun. And so, after working hard for his whole adult life, Bill, he’s 63 now. He’s finally retired and he’s going to go to a lot more concerts now more than ever before. That’s how he wants to sell uh celebrate his retirement, enjoy himself. So, Bill has $58,688 in taxable income, which includes 375 of Social Security benefits this year. As you can see, Bill’s $58,688 of taxable income puts him squarely in that 22% tax bracket. Because it’s more than 50, 401, but less than 1057. Now, towards the end of the year, Bill decides to take an extra,000 out of his IRA for a trip to see Willie Nelson, old Willie, playing in Austin. And how much is he taxing that extra thousand dollar? Well, I mean, the the logical answer is that for every dollar of IRA money he pulls out, he’ll pay 22 cents in federal income taxes, right? You know, 22% bracket. And therefore, if he took out $1,000, he should only owe $220 in federal income tax. That 22% tax bracket. I mean, simple enough, right? Well, you’re wrong. He owes $47 in taxes, a 40.7% federal tax rate on that income. That’s thanks to the madness that is our tax code and the unique formula that determines how your social security benefits are taxed. And the real answer is that billow is $47 and that extra income. We’ll get into that a lot more soon, but everyone’s tax situation is different and you should always consult a qualified professional tax advisor to discuss your specific tax situation, especially about these topics. You traditional IAS are tax deferred, must pay taxes on the distributions or the conversions at ordinary, federal, and state rates down the road. Your Roth IRA, that’s your money that grows taxfree. You already paid taxes on it, taken care of. Then there’s state taxes, too. But this presentation references federal taxes. So if you’re in the state of Florida or Texas, obviously it doesn’t matter. Um you may still face state taxes depending on where you are. Check with your tax pro. We can go over that too should you decide to meet with me afterwards. But I am a financial consultant folks. I do not prepare taxes or provide tax advice. What I do though is tax planning and I help people understand how that tax code and other rules could impact their financial planning and investments. And then we develop a plan to take into account many of the odd things people encounter, especially around taxes in retirement.

But our goal here is to help you understand that the retirement distribution game, spending assets in retirement, is much different than the accumulation game when you’re saving for retirement. So, chances are you’ve been in the accumulation phase for most of your life, for several decades. You’ve been working hard and just trying to save money, and hopefully your accounts have grown. But now, as you may be entering or preparing for retirement, you’re in an extremely entirely different place, the distribution phase. And the distribution phase has new strange rules that can catch people off guard. And along with those new rules, there are often many changes in your own personal life that can have a big impact on your taxes, too.

So, that brings us to a simple statement about the problem we’re here to discuss. Simply put, people often pay more in taxes in retirement than expected because a confusing system treats various income types differently and contains hidden taxes and penalties. So in the accumulation phase, people build their assets in several different forms, stocks, bonds, etc. 401ks. In the distribution phase, your regular wages stop coming in and you have to take the money you’ve saved and use it to fund your retirement, which can go on for decades, hopefully. So hope everyone here lives to be 120 plus but with just good health in your side. And that’s challenging because you’ll need to make informed decisions about the tax implications of tapping different accounts and it can be costly. So in retirement your tax rate can vary dramatically based on decisions you make such as the timing and order which you use different sources of money to pay for your expenses. And those poor choices through misunderstanding or ignorance of the rules can result in people paying way more money in taxes than it’s necessary. And as a result, they may see their savings drop faster. That can mean less to leave to your kids, grandkids. You know, of course, we don’t want that to be you. And the fact that you are here means to me that you’re willing to work towards a solution, which is of course the most important first step. But because your tax exposure will change throughout four stages of retirement, you’ll need a strategy that anticipates both traditional taxes and possible taxes. You know, possible search charges, penalties related to social security, Medicare, and other income sources. But that means you’ll need an informed and proactive plan that addresses how you create your income in retirement. But my goal here for you today is to introduce you to the major aspects of such a strategy, show you the challenges we all face, and then explain what makes up a workable solution to our retirement tax problem. But the first step is to develop an understanding of the types of taxes you may face. And what I mean by taxes, I’m talking about all the costs that can increase as your income does, including some that aren’t actually called a tax. You know, to me, if your cost goes up as your income rises, it it’s a tax in my book. So, you also need to understand the retirement expenses you’ll face. And you’ll need to create a strategy that will help you decide which of your assets to tap first, how much you should be taking from those assets, and when those distributions should occur. And getting this right will help you pay as low a tax rate as possible. Hopefully, you save a fortune in taxes. You’ve paid enough already, more than likely. But before we go on, here are four stages of retirement that we’ll discuss. These are rough ranges and descriptions. You your experience may differ. This is just a framework for discussing our topic. First, there’s pre-retirement, the final home stretch, the work and save years of 50 to 60. Next, the early years of retirement, 60 to 70, those go-go years. People often have grand plans for this time, like you’re traveling, volunteering, starting some new hobbies, etc. Then you reach those middle years of retirement, 70 to 80, the go slow years, which brings more financial decisions such as how to deal with RMDs if you had we’ll get into RMDs, required minimum distributions from your IAS and other retirement accounts. Finally, there’s the later years of retirement when your health may not be as good and you’re thinking about your legacy and your estate. You know, the no-go years starting around age 80. Hey, for some of you that’s not until 90, 95, 100 probably. Um, but as you’ll see, there’s just a wide range of issues that have to be planned for in each phase. And this can be a lot harder than it seems because retirement is just full of surprises. And even the best planning will divert from reality at some point. One future unknown is inflation. People tend to view their future costs in current dollars, and they don’t always anticipate how those costs grow with inflation. Think back 30 years ago to the cost of a gallon of milk or a gallon of gas or a Coke at the vending machine. Used to be a nickel when I or a quarter when I was a kid. Now it’s a buck buck 50 or a visit to the emergency room. We know how much how expensive medical uh costs have gone up. Now think about those costs today and imagine what they’ll grow to over the next 30 years when you’re not working. That’s inflation. Or how about your longevity? Many people end up living far longer than expected, which is great, but that requires more money at a time when it’s difficult to work. So, how long do you think you might live? And many people also understate how much money they need to maintain a pre-retirement standard of living. And who wants to see their standard of living drop? These are the go-go years. You want to have a lot of fun now. And then there are health care costs. That’s that 10,000lb gorilla in the room. That includes your out-ofpocket payments for services and drugs plus Medicare and insurance costs which just keep rising. They’re about double what standard inflation or it doubles. They grow by more than double standard inflation too. For many retirees though, taxes could be their largest expense in retirement. But it is not often discussed or addressed with a thoughtful plan. Now, at this point, you may be thinking, okay, so what’s the first thing I need to understand about retirement and taxes? Here it is. It’s our first key. You have to know what your after tax retirement savings picture looks like before you actually retire

because a $500,000 401k or IRA balance isn’t really worth $500,000 if it’s pre-taxed. That’s what we mean. If it’s a pre-tax 401k or IRA, the government still has a claim on part of that money because the taxes were deferred. They’ll get their share when you’re forced to start your required minimum distributions at 73 or 75. The Secure Act 2.0’s push back RMDs to 73 if you were born between 51 and 59. If you were born after that in 1960 or later, you won’t have to start taking them until 75. Obviously, the higher your tax rate in retirement, the less your account is actually worth, though. So, here’s an example of that. This chart shows you the cumulative after tax value of a half a million dollar IRA. That’s just earning a modest 6% per year at different tax rates. And as you can see, the lower your tax rate, the more you get to keep. Simple in theory, very difficult in practice, though. And by the way, of course, this presentation applies to both pre-retirees and retirees. So don’t worry if you’ve already started your retirement. Tax planning is important throughout your retirement.

Now, you may be thinking, okay, my accounts may not be worth as much as I thought, but I’ll have a steady flow of benefits from Social Security to supplement my income, and I’ll have Medicare to pay my health costs. But one thing that you need to understand when creating your retirement tax strategy is social security and Medicare have their own tax traps that you need to plan for as well. So let’s get into social security and taxes now. Let’s go back to Bill from our tax brain teaser at the beginning. And we want to understand why he paid such a high tax rate on that extra amount of money that he took. It was just $1,000, but he took his extra $1,000 from his IRA to go on a concert road trip to go see Willie. You know, remember he has $45,000 of IRA income. Part of his adjusted gross income is $65,538. He has $37,500 of social security benefits. So that puts him squarely in that 22% bracket. And he takes the standard deduction. Yet, when he took the extra$1,000 IRA distribution, he got hit with a nearly 41% marginal tax rate on that $1,000. So, let’s break down how this actually happens. First, let’s remember the only difference between our two scenarios here is that Bill takes an additional $1,000 from an IRA. You see that in that after concert trip column, he has for $46,000 in IRA income. So we see here that by adding that additional $1,000 of actual income, it increased both his AGI and his taxable income by $1850. And that means for every dollar of income he actually received, he’s being taxed on a dollar on a $185. Huh? How? Why? Well, here’s the deal. Depending upon how much other income you have, the amount of your social security benefits that are taxable varies. For instance, if your other income is low enough, all of your social security benefits can possibly be income taxfree at the federal level. On the other hand, if your income is high enough, up to 85% of your social security benefits can be taxable at whatever your personal rate is. When Bill finds himself in the later scenario in the latter scenario at his current income after the concert trip, for every dollar that he takes out of his IRA, he not only adds $1 of IRA money to his taxable income, but he must also add an additional 85 of taxable social security benefits.

And if you add that up, that’s a $1.85 85 taxable at his 22% rate for every $1 of additional IRA income that he actually receives. And if you do the math on that, it comes out to 40.7% real tax rate on that additional $1,000 income. And that’s the so-called social security tax torpedo. It can impact single filers. It can impact married couples with even fairly modest income during any stage of retirement. And it’s just one reason planning for taxes and retirement is so important. Let’s look at another aspect of social security and taxation and how people approach retirement. Pardon me, somebody’s driving by with a motorcycle. Now, during the go-go year stage, some people retire altogether, but other people enter into a sort of a semi-retirement. And sometimes it’s a continuation of a previous job just with fewer hours. Others use it to explore an interest in a new field. Still others use semi-retirement to pursue non-paid rewarding volunteer work. So working retirement can impact your planning and taxes in just a number of ways. And some good, some bad, and some can just be downright ugly.

So let’s look at how working during these years can be a good thing. Chances are you’ve researched what your social security benefits might be at various ages, but you may not know that your social security benefit is calculated using your highest 35 years of inflation adjusted earnings. Well, what if you started working late in life? Or what if you left work to raise children? You may not even have 35 years of earnings history. You suppose you have only 28. The remaining seven years just count as big old fat zeros when they calculate your benefits. And if anybody’s ever missed a quiz or a test or remembers their school days, a zero really can pull your grade down way worse than, you know, just a regular old F between getting a 40 or 60. That zero really drags you down. But there’s good news. Earnings at any age can help you increase your social security benefit. And thanks to how Social Security calculates benefits, replacing several years of zeros with even my earnings can positively impact your benefits down the road.

Now, let’s look at how working during your go-go years can be somewhat bad, though, if you’re already collecting benefits and unaware of the Social Security earnings limit that applies prior to reaching your full retirement age. Here’s how the rule works. If you start social security, be it your own retirement benefit or spousal benefits, prior to the year you reach your full retirement age, probably 67 for most of you, every $2 above a certain amount that you earn, which $24,480 in 2026. So for $2 that you earn above that, Social Security will be withhold the dollar in benefits. So, just keep in mind that we’re talking about earnings here, like a W2 salary or self-employment income, not talking about pensions, interest, dividends, capital gains. They don’t count and won’t reduce early social security benefits. For instance, let’s say you earn $25,400 in 2026. That’s 200 two $2,000 over the limit. Therefore, under the one one for two withholding, Social Security would withhold $1,000 of your 2026 benefits. But these benefits aren’t truly lost, though. When you do turn your full retirement age, your benefit will just be adjusted upward to make it as if you’d applied at full retirement age with respect to those withheld benefits. In other words, your benefit going forward will be a bit higher. Also, in the year you reach full retirement age, there’s a separate higher earnings limit.

Okay? So, now we talked about the good and the bad. So, now we got to get to the ugly. And we’re here today to talk about taxes retirement. But there are other taxes that you may face too. For instance, while you’re working, you’re subject to the 7.65% Social Security and Medicare taxes in addition to income tax. The self-employed pay twice that amount, 15.3% to cover their employer’s contribution. Now, these taxes don’t go away if you’re working past your full retirement age or even if you’re collecting social security. Worse, if your go- go year’s earnings don’t make it into your top 35 years, those social security taxes go into the trust fund and do not increase your benefit. So, keep that in mind. Next, let’s get into Medicare and taxes.

Let’s just take a look at how Medicare and something it calls IRA can impact some couples in the go-go years and beyond. IRMA basically is what you’re going to be paying towards social security or towards Medicare while you’re under uh while you’re in Medicare. Think of it as your premium. First, what is it? It stands for the income related monthly adjustment amount. And the emphasis is on income because it is a monthly tiered search charge. Again, it’s a kind of a tax and it’s tacked on to people’s Medicare Part B and D premiums, but it only happens if you have income over 109,000 for single filers and 218,000 for married couples filing a joint return. So, let’s take a look at what this means in action. Let’s meet George and Martha here. They are a high earning married couple and both are Medicare Part B and D participants. And ears charges affect income from 2 years prior. And this couple is on track for $342,000 in modified adjusted gross income uh in 2024. So it’s 2026 now. So they’re going to be judged in 2026. Their taxation or their IMA charges are going to be p um based off of what they made in 2024. But on December 1st, 2024, George decided to sell a stock that he bought for $10,000 on July 1st, 2007. He sold the stock for 11,000 resulting in $1,000 of gain. Was taxed at 15% long-term capital gains rate, which is standard for most, plus an additional 3.8% of net investment income sir tax for a total federal tax bill of 18.8%. And that 3.8% net investment income sir tax is another tax that does come into play when your modified adjusted gross income exceeds 200,000 for singles and 250,000 for married couples. So George and Martha owe $188 of tax and the gain from the sale of their stock, right? 18.8 of a,000. Or do they? Remember, my definition of a tax is any cost that increases as your income increases. So then George and Martha will owe more than $188 because the gain from the sale of the stock pushed them off the Medicare IMA cliff into paying higher Medicare premiums. Let’s take a look at those. So look at this part B here in my chart. That extra thousand gain pushed their AGI into the next premium tier that starts with $342,01. So now instead of paying $405 each for their monthly Medicare Part B premiums, George and Martha are now going to owe 527.50 each per month. So that’s an extra $121.70 bucks.70 per month. Multiply it by two, it’s $243 $244 more a month for an annual total in additional income related monthly adjusted Medicare Part B premiums of $2,920 just for selling the stock. He threw himself into another bracket. And we do this kind of planning, too. So we’ll keep an eye out for that. But we can help you with this. But it’s not over though because now Medicare Part D, we just we were just looking at Part B. Now Medicare Part D is going to also be impacted. And George and Martha will now pay each another 22 $23 per month for their drug plan, which is an extra $550 for the couple over the course of a year. So we’re talking about a $3,600 a year swing just from the sale of the stock.

Again, just adding all those search charges together. George and Martha will each owe an extra $145 a month, more than $3,400 a year of combined additional charges for the year.

Now, combine that amount with the $188 of actual federal tax income income tax they would have owed on the sale of that stock and the total tax owed on $1,000 of gains. That comes to 3658.40 40 cents and that’s tax rate of 337%. Let me repeat that. That’s a tax rate of 30 365%. So, let’s just do a quick review. They sold stock for $1,000 income gain. The stock sale tax was $188, $15 for long-term capital gains plus the net investment income tax, 3.8%. The extra income from the stock sale triggers new IRA tiers, new Medicare costs. And the total IRMA charges amounts for the year to it increases it to $3470. So the $1,000 extra income triggered taxes of $3,658.

Again, $365% real tax rate. You see, being pushed into a higher Medicare Part B and D premium range is worse than being pushed into a higher tax bracket for most. That’s because if you go over a regular tax bracket by even a single dollar, only those last dollars are taxed at that higher rate. But if you go over the Medicare Part B and D income levels by even a single dollar, you then move into the next premium tier. It doesn’t matter if you exceed the limit by a dollar or $10,000. That’s what they call the earma cliff. Just keep in mind your IMA payments are not determined, again, let me just repeat this. Your IMA payments aren’t determined by how much money you made the previous year, but rather your modified adjusted gross income from two years ago. And it’s another tax thing that catches people by surprise and it needs planning.

And making sure that you enroll in Medicare at the right time is a critical decision. If you bungle it, you’ll get hit by a lifelong penalty. So to help you understand that Jim and Anne here, both 68. Jim retired at 65. Anne retired at 66. Prior to her retirement, the couple had health insurance through Ann’s employer, and they continued that after Ann retired because her employer offers her their own health benefits. Unfortunately though, they didn’t know they had to enroll in Medicare Part B as soon as an retired. And even though Anne’s employer offered you retirey health insurance benefits, those benefits are generally paid secondary to Medicare after retirement. But Jim and Anne didn’t realize the mistake until it was too late. And thanks to the way Medicare enrollment periods work, they weren’t able to begin coverage until the next year. And in a worst case scenario, this might have resulted in a gap in coverage for Jim and Anne. They had a major medical need. But even in a best case scenario, because Jim and Annne missed their deadline to sign up for Medicare Part B, they will each owe 10% Medicare Part B base premium penalty for life. Again, for life, they penalize you perpetually for this. And you can see how much that translates to in real dollars. They owe $487 in extra in 2026. And historically, we can estimate that the premiums will be higher. So that 10% penalty would just grow and grow and grow over the course of a lifetime. That could translate into a $10,000 mistake for the couple. But just for simplicity sake, we’re assuming that Ann’s retiree health insurance covers prescription drugs so they don’t have to sign up for part D. Just know there’s a penalty for that, too, though.

We’ve seen how Social Security and Medicare have their own tax traps and unique rules and penalties. So, if you’re like some who’ve seen this presentation, you may be asking yourself, “Wow, are there other tax traps we can face in retirement?” Well, the rest of what we’ll cover isn’t like what we’ve seen with the Social Security tax torpedo or the Medicare earmar isn’t aware of those tax squeezes. What we’re going to see now is how the tax code in plain view snags retirees, especially when there’s no planning. And that brings us to our third key.

You must plan how and when you will use taxable, tax deferred, and tax-free assets to manage your income and tax brackets efficiently. You can’t be halfhazard about tapping into your tax deferred savings. Timing is everything. And if you don’t plan carefully through all stages of retirement, you will encounter unintended tax consequences. Let’s take a look by first addressing a question I hear often when doing retirement planning. Which accounts to spend first? And here’s a common example. I told you guys earlier, this one’s nothing but examples, but hopefully they they’re able to make the point across. Talking about Sam and Mary here. They’ve been great savers, as you can see, and are looking forward to spending their retirement years traveling and seeing their grandchildren. In addition to social security benefits, though, they also have uh $450,000 each in an IRA, $60,000 each in a Roth IRA, and 300K in a joint bank account. They want to spend about $8,500 a month or just over 100k a year. You where would you take the money from first? Most people think first take the after tax money in the bank, then take the tax deferred IRA money, then take the tax-free or Roth IRA money. And this is conventional wisdom. It has been promoted by many big investment firms for some time. And it’s not a bad plan, but we know conventional wisdom isn’t always the best approach for that matter. And not surprisingly, this topic has drawn the attention of academic researchers specializing in financial planning. They’ve conducted multiple studies on how to prepare for retirement using a combination of social security, taxable banks, bank accounts, tax deferred accounts like IAS and pensions, tax exempt Roth accounts as well. And you can see some study titles there. The research has shown that the conventional wisdom approach probably isn’t ideal. I mean, again, everybody’s we might have a bunch of cookie cutter homes here in Texas, but shouldn’t be subject to cookie cutter ways and just conventional wisdom, especially in retirement. But here, in an alternative approach, there are two key elements in the early years. First, use the taxable bank money for expenses, but also during the same period, accelerate IRA distributions during otherwise lowinccome years, then putting that money into Roth accounts. And this is the fill in your tax bracket approach, which we’ll discuss here in a second. And this alternative approach gives you more flexibility to use that tax-free Roth money strategically in future years. Does it make a big difference? I mean, I think so. And in the academic studies, this approach has been shown to increase portfolio longevity, and that is how long your portfolio assets will last without requiring you to take on additional risk. The big takeaway here, of course, is that you’ve got to plan all the way through retirement, especially around how you handle your tax deferred assets. And of course, see your tax pro and financial consultant for tax advice and tax planning. One way to help manage your income both before and during retirement is to utilize Roth IRA conversions. And a Roth IRA conversion is just a simple process that allows you to move money from a traditional IRA or the other pre-tax retirement accounts like a 401k to a Roth IRA. In general, the amount that you convert is added to your income for the year and will be taxed at your rate. So, for example, if Jill from earlier converts $100,000 from her IRA to a Roth IRA, she’ll have to add $100,000 to her income and the conversion income will be taxed at Jill’s rate for that year. For that reason, it’s recommended that prior to making any conversion, again, t consult with the professional. But it doesn’t always have to be all or nothing. In fact, rarely do should you ever do a conversion all in one year. Break it up. And one helpful conversion approaches using something called filling up the tax bracket. You know, often you may find yourself in the middle of one of the tax brackets with a lot of room to add more income without pushing yourself into a higher bracket from there. So, for example, in 2026, 22% tax bracket for married couples filing a joint return goes from about 50,000 to about 105 106,000. If you file a joint return, your taxable income is 110,000. That means that you could add another $100,000 of income without going into that next tax bracket. Making a Roth IRA conversion like that could make sense to some. Maybe you do a little bit less. There are ways of finding out the best strategy for you. But if you plan to convert a large IRA, this approach is often more tax efficient than converting the full amount in one year. Instead, you can make smaller Roth conversion num um conversions over a number of years, filling up tax brackets or just doing a smaller fixed amount. And this can really help the average tax rate that you’ll pay on your converted money and spreads out that tax bill over a very long period of time. And generally speaking, sometimes that happens between when you retire and whenever you hit your RMD age, when you are in a much lower tax bracket, more than likely. But conversions can be especially powerful in years when your taxable income is low, such as having a high non-recurring medical expense deduction, low sales years, maybe you’re retired and you’re just living off of cash reserves and social security. It’s also common for people who retire early, like I mentioned, just not receiving social security benefits, their pensions yet. They just may have a very low tax bracket, making it a good time to complete, you know, filling up those brackets throughout the years.

So, this is a good time to spell out the crux of things. You know, you must know whether you’re trying to keep income below a bracket threshold to avoid bumping up to the next highest tax rate or whether you’re trying to increase income to fill up a bracket to take advantage of that tax rate. And some tactic some tactics you could use in managing income around tax brackets might include withdrawing taxfree money from life insurance policies to keep that income low. Selling highly appreciate stocks for low or no capital gains. Taking distributions from IRA or 401ks take advantage of a lower tax rate. And as we’ve seen, you can also consider a partial Roth conversion to fill up those lower brackets.

There are also other pre-retirement strategies to consider, but they don’t apply to all people. First has to do with how you use a health savings account, and this would only apply to people who are covered by those high deductible uh HDHP health plans. And the second has to do with small business owners, those who want to be extra tax savvy and saving for retirement. Yeah, you can fund a company pension plan which for certain high earning business owners can increase their ability to claim that qualified business income deduction. Uh both of these features of the tax code could be used to manage you know your tax exposure and provide significant tax favor benefits throughout retirement. If either or both of these apply to you, just go ahead and note that now in the questions area of your value um you can note that now and just make a mention of it later.

All right. So, we’ve seen throughout the presentation the critical importance of managing our tax deferred accounts because at some point you’ll be forced to take out RMDs required minimum distributions and that can be troublesome for your tax bill. Many people make charitable donations too supporting their favorite nonprofit with annual gifts. So, let’s look at how your RMDs and charitable giving may work for you with some planning. Now, we have Albert and Shirley. Thank you for joining us, Albert and Shirley, who are in the 24% tax bracket. Now, the standard deduction for a married couple filing a joint return this year is $32,200. Albert and Shirley are over 65, though. So, they each get an additional standard deduction, bringing their total standard deduction for 2026 to roughly 322 for the purpose of the scenario because they’re in that 24% bracket, meaning their taxable income is 27,000 plus. We assume they do not qualify for that enhanced senior deduction of $6,000 per person because they that starts phasing out at 150 grand. That’s the new one that came in with the one big beautiful bill passed last year. However, if they take the standard deduction, they qualify for the maximum $2,000 for married filing jointly. Additional charitable deductions available in 2026 as well. We’re not going to get too far into this, but if Albert Shirley had $15,000 of existing itemized deductions, say from state and local taxes, deductible medical expenses, mortgage interest, if they’re still paying their mortgage, what happens tax-wise if they donate $5,000 to charity, they get no federal income tax benefit from making that charitable contribution because it doesn’t exceed that 32,200 standard deduction. Now, that’s not to say they shouldn’t do it, but they should understand it’s not going to help them in saving their taxes.

Now, if you’re over 70 and a half, though, you have an IRA or inherited IRA, there’s another way to give to charity than simply just writing a check. It’s called a QCD, qualified charitable distribution. Let me explain how it works real quick so you can see how they can be powerful in tax planning. First, some rules. If you’re over 70 and a half or older, you can make a QCD of up to $111,000 a year. At least for this year, it’s going to be adjusted with inflation from your IRA. You can do this. If you’re married and both of you are over 70 and a half, then both of you have an IRA and both of you have an IRA, then you can each make that $111,000 QCD maxed out. Second, any qualified charitable distributions you make count towards satisfying your RMD distribution for the year. So, if you didn’t need that extra money that Uncle Sam’s forcing you to take out, you can apply that towards QCD and lower your taxes. But whenever you make the distribution from your IRA, it must go directly from your IRA to a qualified charity. Has to be a direct rollover, direct transfer. You can receive a check from your IRA custodian, just make it payable to the charity. Third, this is the odd part. Even though you gave to charity, you get no income tax deduction. So why would I suggest a strategy where you get no deduction for giving it to charity? Because when you make a QCD, the distribution from the IRA is never counted towards your income when then you compute when you compute your taxes later. So let’s see how that can actually help out Albert and Shirley. So we’re we’re under the assumption that um let’s just suppose that Albert Shirley do what many retirees do. Albert takes his RMD of $5,000 at the beginning of the year and deposits it into the bank. He’s done with his R&D for the year. Now, being the charitable people that they are, they donate 5,000 to charity. And the end result is that that charity gets 5,000. Everybody understands that. But let’s look more closely. By virtue of giving to charity this way, Albert and Shirley’s $5,000 charitable contribution will cost them a total of $5,720. Why? Well, because the $5,000 RMD that went into Albert’s checking account at the beginning of the year still has a tax cost. Remember, the couples, they’re in the 24% bracket, 24% of 5,720. So, there’s 720 additional taxes that Albert and Shirley must pay when they file their taxes. Means the total cost of their charitable gift is 5,000 plus 720 or 5,720. So, remember, the gift didn’t impact their standard deduction. RMD behind the gift just added to their income. Big ouch. But let’s see what happens if instead of just writing a check from the bank account to them, if you made it in the form of a QCD, which is what they’re doing here, they give a $5,000 QCD and instead of requesting a $5,000 distribution from his IRA to go into his bank account, Albert’s simply just having the IRA custodian make the check directly out to the charity of his choice. It satisfies Albert’s uh RMD because he’s over 73 at this point. And now the charity is in the same position as before. They receive a $5,000 donation. Good day for them. Albert and Shirley, however, are also in a better position because they still give $5,000 to charity even though they receive no deduction from making contribution, but their IRA distribution is excluded from their tax return. Therefore, they owe no income tax in that $5,000 distribution. and their total cost to give the $5,000 to charity is $5,000. So that’s a savings of $720 of our previous example. So again, simply by knowing how to use these tax rules to their your advantage can work out if if giving you a charity is important to you and they did it all without ever even getting a deduction.

Have one person here saying they lost sound. Did anybody else lose sound or you can still hear me? Can everybody still hear me?

Okay, great.

And I didn’t even click through these. I’m sorry, folks. All right. Well, we all know charity starts at home. Got it. Sorry. Thank you. We all know charity starts at home. So, it’s a natural question to ask, how does retirement tax planning factor in? And it’s a very good question because the government still wants its share of those tax deferred assets when you pass away. And like we’ve seen, how you set things up does really matter. Which leads us up to our final key number four. Organize your assets for your family’s benefit. Estate planning still matters here. Estate planning is always a relevant topic, even though people don’t like to discuss death, but we’re not going to discuss it in the traditional way. That’s because the new tax law excludes estated values at up to $13.99 million from the federal estate tax, meaning only the tiniest fraction of people need to worry about estate taxes. Now, again, you might still face them at a state level. something that we can talk about though still very important very important tax issues remain around how your assets are received by your beneficiaries after you pass. One example is making sure married couples plan for their available step up in basis. That’s quite a tax term, right? Simply put, step up in basis is a tax rule that readjusts the value of an inherited asset. So its value is not what your spouse or the death paid for initially. said it stepped up to its price in the date of death. And this can make a big tax difference as we’ll see. Another example, if you bought stock in GE 50 years ago, $10,000 worth of stock in GE 50 years ago, and it’s worth $200,000 today. So, it’s $190,000 of capital gains for you. You pass away, you give it to your children, your children receive it at a new cost basis of $200,000. Should they continue to let that stock grow, now they have capital gains, but it’s not from 10,000 to two, it’s 2 to2, whatever new gains have from there. It’s likely that most assets you own though, other than your retirement accounts and annuities, they will be eligible for a step up in basis.

All right, let’s see how this works with two scenarios. In the first, Phil and Mary make no planning changes to their assets. And when Phil passes, Mary will receive a step up in basis on Phil’s half of the joint account, which is $60,000. So, she’ll still face a future $60,000 of unrealized gain on her half of the account. Simply put, that means if Mary decides to sell all the assets, she’ll owe tax on her $60,000 of gain. Now, suppose that upon Phil’s diagnosis, Mary and Phil move all the investments into one account in Phil’s name. And as long as Phil lived longer than one year, Mary would receive a full step up in basis on the entire $120,000 account. So simply put, Mary could sell that account and pay no tax.

And when you sell your investments, would you rather owe tax on $60,000 a gain or none at all? Let me say planning around death is hard. A lot of city buses out there that could just come out of nowhere, but this is where a professional can help because they are emotionally removed from the situation. They can assist you to make good decisions that may seem hard at the time. Now, maybe you’re someone who’s managed to save up quite a bit in your IRA or your 401k. You feel pretty confident that you’ll be comfortable in retirement and you’re hopeful that you’ll leave behind the account to your children. And in the past, we we have recommended that because with the right structure, your heir could withdraw the money throughout its lifetime, possibly over decades. That changed recently though in December of 2019 with the Secure Act 2.0. And now beneficiaries of inherited accounts, with some exceptions, they have to withdraw all the money within 10 years of the owner’s passing and pay taxes on that money. That is for those pre-tax accounts, of course. Now, the restriction what was called stretch IAS shines a light on how important tax planning is and laws can change at any time. So, you need to have a plan and revisit that plan regularly. Let’s look at Pamela and Kyle as an example of what choices beneficiaries have when they inherit IAS and no longer can stretch distributions over the course of their lifetime. The first scenario we have involves Pamela and her son Kyle. Pamela unfortunately passed away at 70, leaving the full IRA to her son Kyle. He is an only child. He’s healthy and the sole beneficiary of that IRA. Now, we know that Kyle has a maximum of 10 years to withdraw the IRA monies to meet those required minimum distribution rules. And Kyle likes regular distributions. So, he chooses to take equal distributions of the funds over 10 years. And that IRA earns an average 6% rate of return annually. This payment will calculate to be 54,347 to Kyle each year for 10 years. Kyle would have to add this amount as income on his tax return for 10 years. Second scenario for Kyle looks a little different though. Kyle lost just lost track of time. He’s already reached year 10, the required minimum distribution window. And since it’s year 10, he must now take out the full distribution in one year. And assuming that same rate of return earned um same rate of return earned annually on the $400,000 IRA, we can calculate the IRA balance has now grown to $716,000 and change. Now Kyle has to take out $716,000 all in one year and pay income tax on that amount from the top tier bracket. So now he’s going to be spending about 37 he’s going to be paying 37% in taxes on that full amount. But enough about death. Let’s talk about long-term care. It’s not a long-term care presentation. It’s about retirement and taxes. Just believe it or not,

there are a number of tax breaks that are associated with long-term care insurance. It can be beneficial. If you want to learn more about it, give me a holler. Be happy to help you understand more about long-term care. I just don’t want to get into it too much today. Um, but it can lower your taxes. A lot of these costs can be deductible. You can pay it out over a couple years. You can pay it all up for it upfront. There are different ways to get benefits from it. So, we’re going to skip through that one.

All right. So, again, we’re towards the end, probably thinking, goodness, how in the word world will we ever manage this? And it’s a good question. So, let’s just bring it all together here. We started with a clear statement about the problem. Retirees just often pay way more in taxes than expected because a confusing system treats various income types differently and contains hidden taxes and penalties. Yay, you’ve finally retired and now here’s all these taxes and penalties. Well, let’s just do a quick review on what we’ve learned in the context of the four stages of retirement. So, under the pre-retirement heading, we saw the importance of understanding the after tax value of your retirement savings before you retire. And we also saw that in those pre-retirement years, it’s critical to consider your tax deferred savings and start taking advantage of funding Roth accounts to fill your brackets. something you do through your early retirement years in low tax years. We also looked at social security and taxes plus the importance of couples ha um plus the importance of couples having benefit strategies that consider surviving spouse and we saw Medicare has its own tax-like structure that can push you off the earlift. And we saw the importance of signing up for Medicare on time right in the middle of those early go-go years. That’s because starting in your middle retirement years, you’ll be confronted with RMDs. And we’ve seen the importance of planning your income needs before then and the tax issues involved. Then we saw the importance of setting up your assets and managing them during the later years of retirement so that you can preserve the most for your heirs and leave them with the most tax flexibility. All those items together lead us to the obvious solution to our original problem because your tax exposure will change throughout retirement. And you need a strategy for that. You need a strategy that anticipates how and when your t you tap assets, which assets to cover your personal expenses. Understand the range of taxes you’ll face at various stages and manage your actions so that you pay the lowest tax rate possible.

So again, so by attending today, I hope that means that you’re preparing to leave the accumulation phase. I hope that you’re finally seeing the light at the end of your career and being able to go retire and moving towards that distribution phase when you get to start spending all this money now. And we’ve seen that the distribution phase is more complicated than working and collecting a paycheck. You know, managing your tax rate throughout those four stages of retirement is part of the challenge of retirement planning. And we’ve seen the cost of mistakes. And naturally, we want to be efficient with our savings. And there are strategies to reduce your tax burden. But as with many things in life, this takes education and planning and advice and it’s a lot to think about and our tax code is complex and the rules keep changing. But what doesn’t change is that you need a plan. So look, you’re all members of the credit union. This is part of a service that we offer and I’d like to help you get started with creating a retirement tax planning strategy. So in a minute, I’m going to go ahead and put up a poll. Click yes, no, not at this time. It doesn’t hurt my feelings if you say no, but we’re here to offer this service to you. It’s at no cost. There’s no obligation. Let’s just help you make sure that you don’t hit any of these tax pitfalls. We’re here to help. So during that meeting, we’ll identify where you and your family stand in regard to preparing for retirement, review your timeline, and identify key retirement planning and tax issues you need to anticipate. And then coming out of that, we can act as your resource and help you find, you know, if you need help with the finding a CPA. We have a referral network of CPAs to work with as well that we work together with. So again, let me go ahead and set up the poll. If you don’t mind answering it, we’re here to help. If you do answer yes, it is almost 8:00 for some of you and 7:00 for the rest. And you know, if you’re one of the folks from California that’s on here, I know it’s earlier, but I’ll be reaching out to you tomorrow um via email or phone. But please, if everybody would answer the poll, at least I get to have a good attentive score here. Um, I I brag about this a lot and forgive me, but uh I do have the best attention and um best answered number of polls, folks answering polls. I I wear that badge with uh with pride. So, please, if everybody could answer the poll, would really appreciate it. Show my boss that I kept everybody’s attention for all 53 minutes of today. Um and with that, let’s get into some questions here. Be happy to answer everyone’s question, but please everybody answer the poll.

Okay. Uh, I do apologize to the person who wanted me to send a link to the presentation. We can’t offer that. I am pushing it on my boss to let me record these and put them on YouTube. Then I can push every I can direct everybody to see them. There’s just a lot of compliance in this business. We deal with people’s money. It’s a lot of uh SEC and Federal rules out there. Uh, it’s like pulling teeth in order to have anything posted. So, we’ll look into it.

Okay. Uh, like more info on the small business tax strategy, go ahead and either send me an email or click yes to an appointment. We can go ahead and discuss that one.

When you discuss converting IAS to Roths and low tax years, are you also talking about converting 401ks? You can you can convert 401ks too. It just depends because IAS and 401ks have their own benefits. 401ks, you get to contribute more, but whatever 2025 investment options your HR department pick, that’s all you have. With an IRA, you have basically you’re fully independent with it. It’s an individual plan. So, you can sometimes take some funds out of your 401k and move it to a Roth IRA. Sometimes you might just want to move over a larger chunk so you don’t have to make that phone call every year. It depends on the person. It depends on your plan. I’d be happy to look over that with you and see what’s offered to you.

This presentation is for married people. How can I use this for single unmarried people? Now, it applies to everyone. We’re just using married people here, but really the thresholds are just cut in half. So, if we’re looking at $218,000 means we’re crossing into the next bracket. It’s 109,000 for the f for the lower bracket in that case. But again, click yes, scan the QR code on the screen, send me an email, whichever one works for you. We can go over it and see how it affects you personally. Again, we do a lot of financial planning here. I can make a financial plan for anybody on here today and show you exactly what you need to do, what might be the best route, and show you some options.

You also put link for appointment to schedule. Uh that would be the QR code here or just go ahead and select the poll.

Is there a positive reason for moving my 401k into an IRA at age 70 or before RMDs? Yes, I find it to be I mean if you if you haven’t retired yet, it doesn’t matter. But I like to IAS more than 401ks simply for the fact of having more options, more control over your account, and most importantly, more investment options. Depending on who you’re using as your custodian, you could have endless investment options available to you, different products, whether it be structured notes, different ETFs, different mutual funds, etc., etc., but for the sake of doing a conversion too. And again, everybody’s different. There’s no cookie cutter portfolio approach here. Go ahead and select a meeting with me. I’d be happy to go over that with you and show you how it might be bene more more beneficial. Might not be, but we could solve that together.

I I hate seeing this one now. Didn’t see the poll. Poll said it failed. My response is yes. Let me go ahead and make a note of that one there, Suzanne. And I’ll reach out to you via email.

Sounds great. Looking forward to scheduling to seeing you in a meeting.

Okay, great question here. I’m over 65 and have a good health insurance plan. I’m still working full-time. Do I have to take Medicare to avoid the penalty? You don’t have to take Medicare yet. You don’t have to start paying into Irma. You can keep your plan. You still need to sign up, though. There’s a way of doing that online. It m they make it easy. They have a fairly good phone call system, too. Um or you could go into the office for that one. But you have to sign up or you could hit that penalty. So, just make sure that you sign up. That’s the most important thing.

Wow. Well, look, we got a lot of responses today. I have a lot of people to make a phone call to. Again, to those who said yes, um I will call you tomorrow or send you an email this evening and you get to go into that email. Click in the calendar link, schedule a meeting with me at a time that works best for you. If you cannot meet during normal working hours and my calendar link doesn’t let you pick select outside of 5:00 my time, send me an email saying that and I will make we can work to do something outside of normal business hours. It’s not a problem. Um, but again, there’s about eight more people to us to to click on the poll. If you don’t mind, please do so. I’d appreciate it. If if it failed, it’s okay. I’ll just report that you said yes or or that you clicked on it. That way, I’ll keep my numbers up. Looking good. Look, folks, today was a great webinar. I hope you learned a lot. Um, I’m not seeing any new questions in here yet, but I I really do hope that you all learned something. I don’t think I’m allowed to let you talk to the person who just raised their hand. Just go ahead and ask me the question in here. I’d be happy to right there or send me an email. Yeah, I’d be happy to uh do a phone call or something there. But look, this is a great presentation. It really does open up Pok’s eyes and to some serious pitfalls you might come across in retirement. And it just it I I hope it doesn’t make it seem like, Lord, when does it all end? I mean, I’ve been working my whole life being taxed by the tax man. Now I’m getting ready to retire to only have to worry about more taxes. There’s a solution to this. It’s not the hardest thing ever. Sometimes it’s just having a financial consultant and a CPA working together. Sometimes it’s just one or the other. But have a plan done. Make sure you don’t hit any of those pitfalls because you’ve already been paying taxes for 30, 40, 50 years right now. No need for you to keep paying an insane amount much more if there’s ways around it. How can I say yes? Uh, go ahead and just do me a favor. If you can scan that QR code, Alana, go ahead and scan that QR code and you can go ahead and schedule a meeting with me directly. If not, just take a photo of that email address and send me one. Be happy to help you with that, too.

All right, folks. Well, look, I hope everybody here learned something today. Um, looks like we’re out of questions. I’ll stay on for another minute or so in case other questions come through. If anybody else needs any questions, anything that we didn’t cover today that you were hoping to have covered or other financial pitfall questions, retirement planning questions, that’s what we’re here for. That that is what my job exists for. There’s my information. There’s the QR code. Schedule a meeting with me. Please, we’re here to help any way possible. And that’s again why credit unions are better than banks. So, thank you very much, folks. You all have a wonderful day. And like I said, I’ll stick Oh, yes. I am a fiduciary. Sorry, somebody just asked that. Uh, I am a fiduciary. So, here to help folks. Let me know. Oh, wait. We did have more questions come in. What kind of info do I need to prepare for appointment? Thanks. Have a good understanding of your current financial situation. What you spend, what you make, what you have. Have those ready. If you have statements ready with you, I’d like to know what those balances are. Um, that’s step one. But also, here’s the fun part. Understand your retirement. What are your goals? What do you want to do in retirement? That’s the fun part that we’ve all been saving up for. Have an understanding of what that might cost.

Well, I’m glad to hear that. Congratulations on being retired for 5 years.

It is very important. Absolutely. If you ever want to look over them together, that’s what we’re here for, sir.

No, I do not act as a tax advisor and a financial planner. So tax advisors are tax preparers, the guys that take the numbers, crunch them together, tell you what you owe in taxes. You know what we can do though is we can help you with tax planning. A lot of that might be Roth conversions in some cases. A lot of it’s going to be working on your, you know, hey, you want to spend X amount of dollars towards X goal. you might hit these issues here, but I’m not crunching your numbers for you. Unfortunately, I’m not certified for that. But I am a fiduciary here to assist in that. A lot of times though, I will work with my client CPAs. That’s a fun part, too, cuz then somebody else can crunch the numbers for me and I get to get to do the investment side of things, which is a lot more fun. So, that’s what we’re here to help out with. But, I do love working with my client CPAs because that way we can come up with a good if like somebody’s doing a Roth conversion. Okay. Can we do 30 or $50,000 this year? You know, the CPA will be able to tell us how much we can convert and what that tax bill will look like and help us make sure that we’re not going to cross into the social security tax torpedo or any of those pitfalls. So, we can work together on that one.

Dynasty Trust. Uh, I can help you figure out maybe what a tr what trust might be best for you. And depending on where you are, I can help find you an attorney to put that together. A lot of people ask me about trust and if it’s necessary. For most people, it’s not. It’s more of a hassle to have a trust, but depends on what’s most important to you at the end of the day. Um, I think trusts are great. I think wills are great. Trust can be a fantastic um fantastic legacy planning vehicle. It just matters on who you are and what you’re trying to do. And then really you can come down to seeing if you if you want the burden of that extra tax return because a trust is another entity. So that is another thing you have to file for your taxes and keep up with. But that they find their place from a lot of people and if you need help with finding an attorney to set that up, we can help you with that, too.

trying to understand this question.

Uh we have a meeting coming up too, so we’ll talk about that. I cannot update a will for you. I’m not an attorney. My my mother who was an attorney told me not to be an attorney. So, I just do I just deal with money instead. Um, but I can I have another attorney who I have here in Texas, I have a couple of attorneys that deal with just trust and I have a couple of attorneys that deal with just wills. If you’re okay with working with somebody in Houston, I know you’re in Dallas area. Um, I can find one up there for you if you’d like to.

How is a charitable donation from an IRA treated normally? You see, Gary, that’s a good question. So, how is the charitable donation from an IRA treated if you normally can deduct exceeded standard deductions? It might make sense in some cases to add it on. It’s just a matter of are you going to surpass that ch that uh the deduction amount. So, it can make sense and again that’s something that we can review. That’s a good CPA question though.

All right. Well, again, I think there’s two more people who didn’t answer. We had about 200 people on today. So, good presentation. I do appreciate everybody joining. But again, I’ll wait for another 60 seconds on here. Everybody else can start signing off. But if you had any other questions, I’ll be on here for another 60 seconds. Thank you everyone. Have a wonderful evening and please join me for the next one on estate planning since we just had a bunch of estate planning questions. But Roth IRA conversion one that along with this webinar top two three favorite ones to do best amount of information there. Have a good evening.

I’m glad you enjoyed. Thank you. I’m over here shaking whenever I give these presentations. So, it means the world to me for you to say that. Thank you very much.

All right, folks.

I’m going to sign off now. Have a wonderful evening everybody. Thank you very much for your time today. See you at the next one.