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For the past 40 years or more you have paid into the Social Security system with the promise that someday when you retire, you will receive a guaranteed monthly income for the rest of your life. Along the way, your employer has kicked in a matching contribution equal to 100% of your contribution.
At the end of your working life there should be a giant pile of cash with your name on it. And there is (figuratively speaking anyway). But it comes with a giant string attached.
In this case, the catch is that up to 85% of your monthly benefit is considered taxable income once it’s paid out to you. What’s more, depending on the state you live in, you may owe state income tax on those benefits as well. (Bad news fellow Minnesotans. We live in one of those states).
The following post will explain how much of your benefit is taxable and what, if anything, you can do about it.
August 14th marks the 83rd Anniversary of Social Security. To mark the milestone I will be posting additional content throughout the month of August regarding social security benefits and how it effects your retirement plan.
To kick things off, check out this short video describing how your social security retirement benefits are calculated and why it may pay to wait.
Photo by Alex Harvey 🤙🏻 on Unsplash
If you can tell me when you are going to die, I can answer a lot of questions for you.
Questions like whether or not you should take the pension or lump-sum option on your retirement plan. Or when to start Social Security. Or how long your money needs to last in retirement.
Of course, no one knows how long they will live or when they will die.
Nevertheless, my job as a financial planner is make sure my retired clients never run out of money during their lifetime, no matter how long that may be.
Last week I wrote about what it means to be an Ed Slott trained IRA advisor. Since then, I have learned that Ed Slott’s program “Retire Safe and Secure” will air on our local, Twin Cities Public Television stations this weekend!
If you want to learn how to avoid the most common tax mistakes people make with their retirement accounts, or why a Roth IRA is so important, or how to take your IRA from “forever taxed to never taxed” you will want to watch or record Ed’s show this weekend.
Ed Slott has been a huge supporter of Public Television for many years and is one of PBS’ all-time largest fundraisers. His programs have raised over $50 million in donations supporting PBS stations across the country. This weekend you can watch him on your local station.
Times and dates are listed below. Check with Twin Cities PBS for more information or click here.
- Retire Safe & Secure with Ed Slott | Friday, Jun 8 at 6pm TPT LIFE
- Retire Safe & Secure with Ed Slott | Saturday, Jun 9 at 11:30am TPT 2
- Retire Safe & Secure with Ed Slott | Saturday, Jun 9 at 9:30pm TPT LIFE
- Retire Safe & Secure with Ed Slott | Sunday, Jun 10 at 3am TPT LIFE
- Retire Safe & Secure with Ed Slott | Saturday, Jun 30 at 7pm TPT LIFE
Now this is must see TV.
Looking for an Ed Slott trained “Elite IRA Advisor”? Call me at 651.379.3935 or email me directly at firstname.lastname@example.org
Ed Slott’s Elite IRA Advisor Group is solely an indication that the financial advisor has attended training provided by Ed Slott and Company. Ed Slott is not affiliated with Royal Alliance Associates, Inc.
IRA mistakes are expensive and often irreversible.
Imagine inheriting a large IRA and “rolling” it over into your own IRA only to find out that the IRS has a very specific protocol regarding inherited IRAs and that you got it ALL wrong.
Worse still, the financial advisor you worked with and got paid to help you, he got it wrong as well!
Oh and this mistake, it can’t be fixed.
Or how about these scenarios…