Do you happen to have after-tax money in your 401k or 403b, assuming the fees and expenses in the IRAs are comparable to the 401k or 403b? Then, a rollover might be beneficial. In Notice 2014-54, the IRS provided the option for an individual to roll over their pre-tax retirement
The breakeven point for someone whose full retirement age (FRA) is age 66 but who takes Social Security at 62 is age 78. After that age, the total payments received would have been larger if they had waited until age 66 to start their payments.
Trusts for retirement plan owners who died before 2020 can use the old law and remain useful planning tools. But unless the new law changes, there appears to be little benefit of naming a Trust as the beneficiary on a retirement account.
Today, however, if someone says, ‘I have a pension,’ that usually means they work in the public sector. Public employees make up 14% of the total workforce. Fifty-two percent of them have college degrees, which is higher than in the private sector, where only 35% do.
SEPs are supercharged IRAs, following the same rules but allowing for higher contributions. In 2020, the self-employed can contribute the lesser of (a) $57,000 or (b) 20% of their net adjusted income (gross income from self-employment minus expenses and half of one’s self-employment tax).
Because the stock market is significantly overvalued at this time, now is an excellent time to consider rebalancing your portfolio. By rebalancing instead of selling what has gone down or buying what has gone up, investors remain diversified but go back to their original allocation. So while diversification is about the eggs, asset allocation is about the basket. What percentage of your basket is going to be in stocks and bonds?