Two Strategies That Beat The Secure Act
Theres a tax bill attached to each traditional individual retirement arrangement and 401, and Congress recently tried to accelerate and increase that tax bill.
Thats why, following enactment of the Setting Every Community Up for Retirement Enhancement Act, many IRA and 401 owners need to revamp their estate planning strategies.
As Ive reported, the SECURE Act ends the Stretch IRA. When an IRA or other retirement plan is inherited, most of the time the beneficiaries must distribute the entire account within 10 years. There are exceptions for a surviving spouse, minor children, a disabled beneficiary and a few others. But in most cases, the ability to make the tax deferral of an inherited account last more than 10 years is eliminated.
New Data Reveal Inequality In Retirement Account Ownership
Baby boomers, men and non-Hispanic White and Asian individuals are the nations most likely to own retirement accounts, according to U.S. Census Bureau data released today.
The 2021 Survey of Income and Program Participation includes new questions that help shine a light on how people were preparing for retirement in 2020.
It highlights differences in retirement assets by generations, sex, race, and ethnicity.
This report also updates similar estimates for 2013 from a recently released paper that used data from the 2014 Social Security Administration Supplement and the 2014 SIPP.
While members of Generation Z were least likely to own a retirement account as of 2020, they also have the most time to accumulate additional retirement savings.
How Can I Roll Over The Balance To A New Plan Or An Ira
There are two ways to move your old plans balance to a new plan or to an IRA. You can:
- ask the old plans trustee to directly transfer the balance to your new plan or an IRA, or
- request a lump-sum distribution of the balance from the old plan and then deposit it into the new plan or IRA within 60 days.
The old plan usually withholds 20% for federal income taxes from the distributed amount, so unless you make up the withheld amount when you deposit the distribution into the new plan or IRA, you:
- must include the withheld amount in your gross income in the year the distribution was made, and
- may owe an additional early distribution tax on the withheld amount.
If your distribution includes property, you can either roll over the property to the new plan or IRA or sell the property and roll over the proceeds. In either case, you must deposit into the new plan or IRA within 60 days of receiving the distribution.
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New American Retirement Plan Verdict
Bob Carlson says that Congress is always passing laws to increase tax rates thus impacting your retirement plans and his book helps you protect your nest egg.
He says that he wrote the book because almost all studies and surveys were showing that the biggest fear retirees have is running out of money during retirement. He says that the new laws being passed are only going to make matters worse because they will take a bigger chunk of your retirement money.
A survey by The alliance for Lifetime Income revealed that 80% of non-retired Americans are anxious that their savings will not be enough to live on when they retire. The study also shows that 63% of Americans are unprotected from retirement and they have no source of lifetime income outside Social Security .
This necessitates the need for planning beyond the existing structure because thats the best way you can secure you future. He says that you need an alternative source of income.
So, according to Carlson, if you want to safeguard your retirement benefits you need to follow the strategies he writes about in his book.
I think the book has common sense investment strategies and actionable tips but I dont think it will solve everything. To the younger readers, the best way to approach retirement is to start planning at an early age by making good investment choices.
The Nations Offering Seniors The Good Life

If you’re considering moving overseas for your retirement, the world is your oyster: there’s a wealth of other countries where Americans can enjoy a slice of the good life. Developed by International Living, the 2022 Annual Global Retirement Index has ranked the 25 best places for Americans to retire to, based on 10 factors, including Climate, Cost of Living, Healthcare, and Governance, with each given a score out of 100. The higher the score, the better the retirement prospect. Read on for a tour through the top destinations for Americans to retire to.
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The Time Is Right For A New American Retirement Plan
Opinion. The 401k system has reached its limit. There has been significant progress, but the problems of the system cannot be fixed incrementally. Morningstar’s policy analysts have diligently suggested enhancements that work within the existing structure. Unfortunately, those changes can only accomplish so much. They won’t make employer-related retirement plans universal, and they can’t prevent leakage. The author suggests a New American Retirement Plan.
All Tucked Neatly Into The New American Retirement Plan
The NEW AMERICAN RETIREMENT PLAN I should tell you up front isnt just another new book.
You wont find it on Amazon, or on the retirement shelf of your nearest Barnes & Noble.
Its highly specific. And highly personal. Its the same blueprint I use for my own retirement.
In its pages, I show you everything from how to maximize your Social Security benefits including getting up to 76% MORE on your monthly payouts Page 43
To how to legally offset the spiraling costs of long-term care medical expenses saving potentially tens of thousands of dollars Page 182
To creating a monthly income stream to last the rest of your life. Page 77
Look, Ive advised friends and family members to use The Plan for themselves.
Ive written about many of The Plans steps in my Forbes retirement articles.
Ive even spoken at length about these strategies at retirement and investing conferences across the U.S.
And when I realized Congress was coming after the retirement funds of every American
I made it my personal mission to create a brand-new approach to retirement
At a time when American retirees need it most, before this new law nicknamed the SECURE Act wreaks havoc on millions of unwitting U.S. citizens.
Heres a look under the hood of the NEW AMERICAN RETIREMENT PLAN.
The end-around maneuver for avoiding congress devastating new retirement law Page 62
How To Practically Guarantee You Never Out-Live Your Money in RetirementPage 9
The Dos & Donts of IRA InvestingPage 72
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The New American Retirement Plan Equates To Working Forever: Nonexistent Nest Eggs And Most Americans Are Bad At Planning As To How Long They Will Live
The idea of retirement is a modern one especially when it comes to saving and having a nest egg. In the past, retirement was only a luxury afforded to a small number of wealthy families. The rest of the population was destined to work until they died. That may seem harsh but that is historical fact. After World War II the idea of mass retirement started to take hold. Even Social Security was merely a safety net to keep you from starving or being homeless. Social Security was never designed as the main source of income for retirees but that is what it has become. Many older Americans simply did not prepare adequately. The taking away of pension plans was supposed to usher in the era of the self-directed 401k. One generation later the results are in and Americans are looking into the new retirement plan. The new retirement plan is working forever . This certainly doesnât coincide with the brochures we see of older Americans galloping across the beach with cocktails in their hands.
The retirement savings crisis
One scary fact is 30 percent of Americans flat out have zero dollars in retirement savings:
Average age of when people will retire and life prediction
Even as the economy recovered, the average age of expected and actual retirement has jumped up:
Retirement money held in the hands of the few
Nonqualified Deferred Compensation Plans
Unless youre a top executive in the C-suite, you can pretty much forget about being offered an NQDC plan. There are two main types: One looks like a 401 plan with salary deferrals and a company match, and the other is solely funded by the employer.
The catch is that most often the latter one is not really funded. The employer puts in writing a mere promise to pay and may make bookkeeping entries and set aside funds, but those funds are subject to claims by creditors.
Pros: The benefit is you can save money on a tax-deferred basis, but the employer cant take a tax deduction for its contribution until you start paying income tax on withdrawals.
Cons: They dont offer as much security, because the future promise to pay relies on the solvency of the company.
Theres some risk that you wont get your payments if the company has financial problems, says Littell.
What it means to you: For executives with access to an NQDC plan in addition to a 401 plan, Littells advice is to max out the 401 contributions first. Then if the company is financially secure, contribute to the NQDC plan if its set up like a 401 with a match.
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Five Features That Retirement Plans Can Do Without
There are many retirement plan features that add tremendous value to both plan sponsors and participants. However, there are also numerous plan features that are relatively useless, mostly because they are impossible for participants to understand, cause administrative nightmares, and/or add little in the way of benefit to plan sponsors or participants. Here are the top five.
Withdrawing 401k Funds After Retirement Is Not The Problem
Opinion: The big problem isn’t helping people distribute their retirement assets to last their lifetime. The big problem is getting people to accumulate the assets they’ll need in retirement. This shouldn’t be news to anyone who follows the retirement industry. Most Americans haven’t saved the money necessary to afford a comfortable retirement.
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Congress Plans To Kill The Stretch Ira But You Can Do An End

Were nearing a critical time for many Individual Retirement Account owners. Advance IRA planning will be imperative if you want to maximize the after-tax value of your IRA for heirs and avoid the new tax burden Congress has in mind.
As I explained last month, despite the deadlock and division in Washington, the Setting Every Community Up for Retirement Enhancement act moved through the House of Representatives by a vote of 417 to 3 in May. A version of it is likely to pass the Senate and become law later this year. The SECURE Act and its Senate counterpart have a number of provisions designed to expand retirement savings opportunities and would delay required minimum distributions .
To make up for the lost tax revenue, the SECURE Act and the Senate version would end the Stretch IRA. The Stretch IRA is a strategy in which children who inherit an IRA make maximum use of the tax code to minimize distributions for years. In many cases, the RMDs are less than the investment return of the IRA, so the IRA not only lasts for decades but increases in value. Under the SECURE Act, beneficiaries would have to distribute and pay taxes on an inherited IRA within 10 years, even Roth IRAs.
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Creation Of Qualified Disaster Distributions
First, a bit of background on a CARES Act provision: As part of the CARES Act, Congress created an exception to code 72, Sec. 2, waiving the 10% early withdrawal penalty tax for distributions prior to age 59.5 from certain retirement accounts like IRAs and 401s for COVID-19-related distributions.
This Coronavirus Related Distribution Exception, simply put, allowed for up to an aggregate amount of $100,000 to be drawn from retirement accounts per individual from January 1, 2020, to December 30, 2020, and not be subject to a penalty tax for early withdrawal as long as the individual or spouse was diagnosed with COVID-19 or had adverse financial consequences due to COVID-19. You can find a full list of qualifying descriptions on the IRS website. As such, December 30, 2020, was the last day to take a CRD, and Congress did not extend this exception into 2021. However, if you took a retirement distribution in 2020 and otherwise would qualify for a CRD, but you didnt notify your plan provider at that time of the distribution it would be a CRD, it is still possible to qualify for the exception. The taxpayer will just need to properly document and report the exception at tax time using form 8915-E.
How Retirement Planning Changes In 2021 After The New Covid
Within the last 12 months, we have essentially seen the passage of three major pieces of federal legislation that impact retirement planning. Far and away the biggest retirement planning bill of the three was the SECURE Act, passed at the end of 2019, and mostly going into effect in 2020. However, due to COVID-19 and the ensuing CARES Act, the SECURE Act likely hasnt gotten the attention it needs.
The SECURE Act dramatically changed the rules about when inherited retirement accounts need to be distributed and moved the beginning date for RMDs to age 72, up from 70.5. The CARES Act, designed to provide relief during the pandemic, waived most RMDs for 2020, created the coronavirus-related distribution for 2020, and expanded 401 loan options for those impacted by the pandemic.
Now, just before the end of the year and with many of the CARES Act provisions about to or already having expired, the Consolidated Appropriations Act of 2021 was passed. As part of the overall appropriations bill, the COVID-Related Tax Relief Act of 2020 was also passed, which was designed to bring expanded unemployment benefits, relief payments, business loans and new tax benefits to the millions of Americans struggling during the pandemic.
The new act does not have nearly the number of retirement changes or law modifications as the SECURE Act or CARES Act, but it does create a few new retirement planning considerations and strategies for 2021 and beyond.
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For The Record Dr Reichenstein Estimates The Following:
If youre currently working and age 40 to 45
You likely wont get as much Social Security as promised today.
If youre working now, but nearing retirement
Youll get a mix of todays benefits, and whats coming .
If youre currently already receiving Social Security benefitsthe likelihood is that nothing changes .
Fortunately, my book the NEW AMERICAN RETIREMENT PLAN shows how to make the right decisions about Social Security benefits.
In fact, on page 129, I explain the one simple move both individuals AND married couples can take to put an extra $25,000 or more in their pockets.
And on page 55, I tell you why the traditional 4% annual retirement withdrawal rate is often completely wrong for people today and what to do about it.
In short, Ive put everything you need to create your retirement plan or to upgrade your current plan together in one place.
And every time something changes, my team makes sure you have access to the updated version, right away.
You see, there are so many money-saving tips in the PLAN, I consider this book to be
Cost And Refund Policy
Bob currently is offering a discounted price for his platinum subscription that he claims is worth $897.75. As stated on the order form, Bob is offering his platinum subscription for $87. On the other hand, his Diamond Elite Subscription costs $149, while his Gold Subscription costs $49.95.
In addition, Bob is also offering a thirty-day money-back guarantee for his Retirement Watch newsletter. And fortunately, you can still keep the materials you received in your initial subscription.
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Congress Just Raised The Toll To Tap Your Retirement Accounts
Get ready for the new normal.
Its going to cost you more to tap into your retirement funds.
Talk about getting fleeced!
You see, Congress has no choice.
Not with how much debt theyve run up over the years.
Not when faced with Social Securitys trust fund running out in 2034.
And certainly not with Medicare getting more expensive each year, as baby boomers get older.
No, Congress plans however fiendish and diabolical are simple.
If they want to pay the bills
They have to come for your money a cash grab of the highest order.
In other words, Congress giveth.
And, now, Congress taketh away.
For decades, they gave us all kinds of tax incentives to put as much money as we could into retirement accounts.
Today theyre putting the screws to us by increasing the tax charges for taking that money out.
And it doesnt end there.
Weve just seen the first of a series of actions by Congress and the I.R.S.
All specifically designed and directed to increase taxes on all retirement accounts and IRAs.
It could even prevent you from qualifying for financial aid for your college-bound kids.
Plus, theres evidence pointing to one of retirees biggest fears coming true
That future Roth IRA distributions wont be what they were intended to be all along: Tax-Free.
I dont know about you, but it all scares the living heck out of me.
And what Ive just described isnt even the most urgent news!
As I said earlier
Americas retirement dam will effectively burst.
Played by the rules