tax

Watch Out for These 4 Retirement Blind Spots

The Bird’s Eye View:

What blind spots are in your financial plan as you prepare for retirement? We’ll explain what they are and how to spot them.

 

Your Guide:

On this episode of Your Retirement Elevated podcast with Scott Dougan, we’re talking about blind spots in your retirement. Most retirees and pre-retirees have them in their retirement plan – things they never knew they needed to be thinking about.

We’ll explain how each of these blind spots can cause problems.

Market downturns

Market downtowns are part of the game. We have to be aware that they are going to happen. We need to understand what your comfort level is with the fluctuation of the value of your money. You need to know what your exposure is in your current plan and determine if you’re OK with that level of risk.

Inflation

This topic has been more prevalent in the news. It looks like the fed is not overreacting to inflation at this point, but we are seeing some things inflate in value, such as lumber and vehicles.

You’ll see supply chain issues on certain things, but we think this is a short-term issue.

Medical costs

If your plan doesn’t address this, it could be a blind spot that could pop up and surprise you. Can your plan support an extra $4,000-$8,000 a month for care for a loved one? How long can it sustain that?

Some people prefer to self-insure through cash flow or assets, but others want to use different strategies.

Listen to the full episode or use the timestamps below to find specific segments.

[4:15] – Market downturn

[6:43] – Inflation

[8:40] – Medical costs

[11:03] – Tax

[13:50] – Looking for blind spots

Thanks for checking out the Your Retirement Elevated Podcast. We’ll talk to you again on the next show.

 

 

Your Guide:

Home Insight About Scott

Scott Dougan, RFC, Investment Advisor – Contact

Do You Know the Four Tax Liability Buckets?

The Bird’s Eye View:

Do you know what the four tax liability buckets are and what you have in each bucket? Scott Dougan explains why it’s important to know this information. 

 

Your Guide:

Do you know where your tax liabilities fall? You may not realize it, but your tax situation likely falls into one of four buckets, and you may have a little bit in each bucket. On this episode of Your Retirement Elevated Podcast, Scott Dougan explains what the four buckets are and why it’s important to know this information.  

We spend a lot of time talking about how to save and grow your money, but we don’t talk as much about tax efficiency.

“I think it’s one of those things that’s overlooked, is that tax planning portion of most retirement plans,” said Scott.

DOWNLOAD THE FOUR BUCKETS WHITEPAPER

Taxable bucket

This bucket contains money you earn from CDs, checking accounts, money market accounts, after-tax stocks, bonds, mutual funds, your dividends and the capital gains you earn from your stocks and bonds.

This is where you should keep your emergency fund.

“Most experts say that we should have about six months worth of essential expenses in our emergency fund,” said Scott.

Tax-deferred assets bucket

This is the largest bucket and contains things such as your 401K, IRA, 403B, 457 or TSP.

You get a tax deduction when money goes in and you are taxed when you take it out. At age 72, you will have required minimum distributions.

Tax-free bucket

This bucket includes Roth IRAs, most municipal bonds, appreciation of capital assets, properly structured life insurance policies, etc.

How much should be in this bucket? “As much as possible,” said Scott.

A lot of work is focused on getting money from the tax-deferred assets bucket to the tax-free bucket.

Estate tax-free assets

This bucket requires more advanced planning and includes things such as irrevocable life insurance trusts and charitable trusts. The goal is to do some higher-end planning so you don’t have to give a large portion of these assets to the federal government due to bad planning.

Thanks for checking out the Your Retirement Elevated Podcast. Listen to the full episode or use the time codes below to listen to a specific segment. We’ll talk to you again on the next show.

[1:30] – Tax liabilities

[3:29] – Taxable bucket

[7:10] – Tax-deferred assets bucket

[10:08] – Tax-free bucket

Thanks for checking out the Your Retirement Elevated Podcast. We’ll talk to you again on the next show.

 

Your Guide:

Home Insight About Scott

Scott Dougan, RFC, Investment Advisor – Contact