Retirement planning is complicated. Many individuals put off saving, thinking that retirement is years away—until it isn’t. Then, in their 40s and 50s, they start to panic and wonder how they’ll catch up. One strategy, made possible beginning in 2010 by a provision to the Tax Increase Prevention and Reconciliation Act of 2005, presents a way for some individuals to potentially put away more money for retirement, in a tax-advantaged way.Read More
While 529 plans are commonly used for education savings, they can also be used for tax-efficient estate transfer. This can be done through a process called forward gifting or superfunding. This process takes advantage of a unique provision in Section 529 of the IRS Code that allows people to gift five years' worth of contributions in the present year without incurring a gift tax consequence. If you remember from Part 1, the IRS allows for an annual gift of up to $15,000 per recipient for individuals ($30,000 for married couples) annually without gift-tax consequences (as of 2018).Read More
When it comes to retirement saving, which is better for you: a Roth IRA or traditional IRA?
What are the differences between a Roth and a traditional IRA, anyway? Is one of them better for everyone in any circumstances? Or does it vary, depending on your circumstances?
The answers boil down to this: The best one for you is the one that leaves you more money after you've paid taxes, once you've retired and started to take withdrawals.
That bottom line depends on your situation — everything from your age to your salary, your pay raises over the years and your tax rate, now and in the future.
All of those factors come into play because a Roth IRA and a traditional IRA work slightly differently.Read More
The U.S. Supreme Court's landmark decisions in United States v. Windsor and Obergefell v. Hodges made same-sex marriages legal nationwide, and ensured that those marriages would enjoy the same rights and benefits bestowed by state and federal law on traditional marriages. As a legally married same-sex spouse, you'll want to be aware of several retirement plan rules that apply specifically to married individuals.Read More
Over the past few years, the health savings account (HSA) has increasingly been referred to as an exceptional retirement savings option. But what exactly are HSAs, who is eligible to open them, and what makes them so great?
What Are HSAs?Read More