A 3-Step Strategy For Retirees Worried About Losing Money In Stocks


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For most of 2019 the stock market did nothing but go straight up. Then August happened.

During the first two weeks of the month major market indexes like the S&P and DOW fell by up to 8% from market highs set the previous month, followed by an up and down pattern that put many retirees on edge.

Investors worried about a slowing worldwide economy, trade wars with China, and concerns about an inverted yield curve. On the other hand, the U.S. economy chugs along at a better than 2% GDP rate, inflation remains super low, and other economic indicators point in the right direction.

Instead of fretting about the next big meltdown, I recommend this easy 3-step strategy for retirees worried about losing money in stocks.

Consider Your Options Before You Hit The Road With Your 401(k)


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One of the common threads of a mobile workforce is that many individuals who leave their job are faced with a decision about what to do with their 401(k) account.¹

Individuals have three basic choices with the 401(k) account they accrued at a previous employer.

Choice 1: Leave It with Your Previous Employer

You may choose to do nothing and leave your account in your previous employer’s 401(k) plan. However, if your account balance is under a certain amount, be aware that your ex-employer may elect to distribute the funds to you.

While inertia is one of the primary reasons for not moving a 401(k), there may be reasons to keep it there—such as investments that are low cost or have limited availability outside of the plan. Other reasons are to maintain certain creditor protections that are unique to qualified retirement plans, or to retain the ability to borrow from it, if the plan allows for such loans to ex-employees.²

The primary downside is that individuals can become disconnected from the old account and pay less attention to the ongoing management of its investments.

Choice 2: Transfer to Your New Employer’s 401(k) Plan

Provided your current employer’s 401(k) accepts the transfer of assets from a pre-existing 401(k), you may want to consider moving these assets to your new plan.

The primary benefits to transferring are the convenience of consolidating your assets, retaining their strong creditor protections, and keeping them accessible via the plan’s loan feature.

Provided their new plan has a competitive investment menu, many individuals prefer to transfer their account and make a full break with their former employer.

Choice 3: Roll Over Assets to a Traditional Individual Retirement Account (IRA)

The last choice is to roll assets over into a new or existing traditional IRA.³ A traditional IRA may provide a wider range of investment choices than what may exist in your new 401(k) plan.

The drawback to this approach may be less creditor protection and the loss of access to these funds via a 401(k) loan feature.

Remember, don’t feel rushed into making a decision. You have time to consider your choices and may want to seek professional guidance to answer any questions you may have.

  1. Distributions from 401(k) plans and most other employer-sponsored retirement plans are taxed as ordinary income and, if taken before age 59½, may be subject to a 10% federal income tax penalty. Generally, once you reach age 70½, you must begin taking required minimum distributions.
  2. A 401(k) loan not paid is deemed a distribution, subject to income taxes and a 10% tax penalty if the account owner is under 59½. If the account owner switches jobs or gets laid off, any outstanding 401(k) loan balance becomes due by the time the person files his or her federal tax return. Prior to the 2017 Tax Cuts and Jobs Act, employees typically had to repay loans within 60 days of departure or face potential tax consequences.
  3. Withdrawals from traditional IRAs are taxed as ordinary income and, if taken before age 59½, may be subject to a 10% federal income tax penalty. Generally, once you reach age 70½, you must begin taking required minimum distributions.

The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG Suite is not affiliated with the named broker-dealer, state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security. Copyright 2019 FMG Suite.

Equifax Settlement Update


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As you’re probably aware, Equifax had a massive security breach back in September of 2017, which compromised personal data of 147 million consumers. As a result, Equifax must now offer compensation in the form of free credit monitoring or cash payouts to anyone whose information was affected.

Here are the details of the proposed settlement:

  • Free credit monitoring or up to $125 cash payment; if credit monitoring services are already in place from the initial breach, that will continue for at least six more months
  • Up to $20,000in other cash payments for time and money spent preventing or recovering from identity theft because of the data breach
  • Free identity restoration services provided by Experian to help fix the impact of the breach 

How to decide:

  • There’s a cap to the settlement funds so payment sizes will ultimately be determined by how many people apply for compensation. Given the high number of claims you could receive significantly less than $125.
  • There’s no limit to how many people can receive credit reporting, so this may be the more valuable option.

Take Action by these deadlines:

  • November 19, 2019 is the last day to opt out of the settlement (by postal mail only) to pursue other legal claims regarding this breach.
  • January 22, 2020 is the last day to opt into this settlement offer (by phone or website) to receive one of the options above, but you’ll waive all other rights to pursue additional legal claims regarding this breach.

As you evaluate your next steps, be aware that scammers are always looking for more ways to take advantage of a data breach, avoid giving any information if anyone contacts you. The best way to safely check your eligibility is by calling (833) 759-2982 or visiting the official Equifax website.

* PLEASE NOTE: When you link to any of the websites displayed within this website, you are leaving this website and assume total responsibility and risk for your use of the website you are linking to. We make no representation as to the completeness or accuracy of any information provided at these websites.

Labor Day is Your Day

September 2nd is Labor Day. The day in which we honor and celebrate America’s working class and their significant contribution to our nation’s economic success. Originally established in 1894 to honor the budding Labor Movement, today’s Labor Day is widely lauded as the grand finale to the carefree spirit of summer and the unofficial signal to “get back to work”.

Labor Day recognizes the social and economic contributions that over 158 million Americans make by going to work each day. It’s also an opportunity to remember the blood and sweat and sacrifice that went into improving work life for so many of us. Thankfully, very few Americans work the 12-hour days and 6-day weeks that were common a century ago, and our children can spend their time in school rather than in factories or fields.

Whether you are blue collar, white collar, a day laborer, entrepreneur, or internet mogul, if you go to work to produce goods and services that grow our economy, improve the quality of life for others or help make your community and the world a better place, this day is for you.

Your work is important. Thank you for what you do.

Why Living in the Moment is Critical to Your Retirement Plan

photo-1441716844725-09cedc13a4e7On a recent Saturday morning I ran along a wooded trail near where I live that leads to a set of soccer fields. As I rounded the corner and came out of the woods I saw kids playing soccer in their little green and white jerseys. Parents and grandparents were lined up on the sidelines cheering them on, their morning lattes in hand.

I felt like had stepped into a time warp that took me back to the days when my girls used to play soccer on those same fields.

Those were good times and great memories.

As a financial planner I am always thinking ahead, living in the future. I plan retirements for other people as I daydream about my own. I often think things like “When the kids are older…” “After the kids are in college…” Or my personal favorite, “Someday when I retire, I would like to…” You can fill in the blanks.

I am sure you have had similar thoughts. Or yours may go like this: “When the market gets better…” “After I pay off these bills…” “As soon as my pension kicks in…”

While planning for the future is important, don’t let it get in the way of getting the most out of your life today. Unless you live a full and fulfilled life before you retire, it’s unlikely that you will do so after you retire. That’s why living in the moment is critical to your retirement plan.

Live a life of no regrets. In her book, The Top 5 Regrets of the Dying, Bronnie Ware writes about the most common regrets people have at the end of life. I won’t give away all 5 here, but #2 on the list: “I wish I didn’t work so hard”.

I try to be extra mindful of this one. Before I got married and started a family, I worked all the time. Nights, weekends, holidays, it didn’t matter. For that time of my life, it made sense to put in the hours. Today, things are different. (Thankfully!)

As focused as I am on my long-term goals, I try to remember to live in the moment and make the most of today. What is the point of a confident retirement, if it means sacrificing two or three decades of your life up to then?

That’s why you won’t see me in the office when my kids are out of school. It’s also why I limit my late appointments to just a couple per week, and I am very selective about the new clients I take on.

If you are not doing so already, start a new hobby or develop an existing one. Join a small group at your church. Find a way to serve your community that gives you a sense of purpose. Heck, just go for a bike ride with your kids or take your dog for a walk on a regular basis. It doesn’t have to be complicated.

Use it or lose it. According to an article on CNBC.com the average American worker uses only 77% of their paid time off. In fact, unused vacation time is at a 40-year high. While some people may be able to roll unused vacation time over to the next year, the average worker loses 1.6 vacation days per year.

That doesn’t sound like much, but it adds up. Think of it this way. If you spend just 3 extra minutes per day at the copy machine, that adds up to over 1.6 workdays per year spent staring at the walls making copies. Since paid vacation is part of your total compensation, losing paid vacation days is the equivalent of working for free.

If you want to spend 1.6 vacation days making copies, go ahead. Me? I’d rather be at the lake.

Live in the moment. Living in the future is a habit I have developed that isn’t always healthy. I need to remind myself to live in the moment and make the most of today.

To get the most out of your life in retirement, you need to do the same. When I create retirement plans for clients I recommend they save up to 20% of their income for their future goals. The other 80% is spent on day-to-day life.

I think that balance makes sense in other ways as well.

Set aside a percentage of your income to meet your long-term goals and spend the other 80% of your time, money and other resources living for today.

At the end of life it’s not the things you did, but the things you wish you had done that you are most likely to regret. Don’t spend life in retirement wishing you had done more living before retirement.