Tag: Retirement Planning

CARES Act and Coronavirus Relief

Apr 2, 2020

Law hammer gavel CARE Act Book
Here are a few ways the government is alleviating the hit to retirement accounts

From Our Partners at PAI: The CARES (Coronavirus Aid, Relief, and Economic Security) Act has been a topic of discussion for weeks as legislators discussed the best way to give Americans a much-needed boost as the economy has faltered due to the Coronavirus. Signed into law in late March, there are several provisions that will help students, workers, and retirement plan participants to maintain more financial stability during this challenging time.

 

CARES Act changes retirement plan provisions for loans and tax-advantaged withdrawals

Retirees and workers alike have likely been groaning when looking at stock values over the last several weeks. While it takes some time for market volatility to level out, these provisions included in the CARES Act may provide retirement plan participants with additional flexibility and more options for loans and penalty-free withdrawals during this stressful time.

PENALTY-FREE WITHDRAWALS FROM RETIREMENT PLANS

Workers who are experiencing financial difficulty due to the effects of COVID-19 on their careers, health, and overall financial wellness will be able to take a penalty-free distribution from a retirement account, like a 401(k) or IRA, between January 1, 2020, and December 31, 2020.

Under normal circumstances, there is a 10 percent penalty tax added to the taxes paid on distributions from a retirement plan before a participant reaches age 59 1/2. However, the CARES Act includes a provision that allows eligible participants to take up to a $100,000 distribution from a retirement account without the addition of the 10 percent tax that normally accompanies an early withdrawal. This tax-favored withdrawal may be repaid to an eligible retirement plan within three years of taking the distribution, with the option to repay beyond the normal annual contribution limits.

Eligible participants for a coronavirus-related distribution are those who have been diagnosed with the virus (or have a spouse or dependent diagnosed), experience adverse financial consequences as a result of being quarantined, unable to work, laid off, or those who had work hours reduced due to the virus.

TEMPORARILY INCREASED LIMIT ON RETIREMENT PLAN LOANS

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A Roth IRA’s Many Benefits

Feb 28, 2020

blue piggy bank hand coin smiling Roth IRA
Why do so many people choose them over traditional IRAs?

The IRA that changed the whole retirement savings perspective. Since the Roth IRA was introduced in 1998, its popularity has soared. It has become a fixture in many retirement planning strategies because it offers savers so many potential advantages.  (more…)

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Tax Considerations for Retirees

Feb 24, 2020

income tax calculator binder pen spreadsheet
Are you aware of these potential tax breaks and tax-saving opportunities?

The federal government offers some major tax breaks for older Americans. Some of these perks deserve more publicity than they receive. (more…)

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SECURE ACT Lesser Known Provisions

Feb 20, 2020

SECURE stack of binders and papers
What Younger Investors need to know

The SECURE Act passed into law in late 2019 and changed several aspects of retirement investing. These modifications included modifying the ability to stretch an Individual Retirement Account (IRA) and changing the age when IRA holders must start taking requirement minimum distributions to 72-years-old.1,2 (more…)

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Retirement Is a Beginning

Feb 19, 2020

Beginning start line road
See if you are prepared to begin your retirement by answering four key questions.

How do you know you are psychologically ready for retirement?

As a start, ask yourself four questions. (more…)

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That First Required Minimum Distribution from Your IRA

Feb 17, 2020

stop watch alarm clock IRA
What you need to know in a timely manner

When you are in your seventies, Internal Revenue Service rules say that you must start making withdrawals from your traditional IRA(s). In I.R.S. terminology, these annual withdrawals are considered your Required Minimum Distribution (RMDs).1 (more…)

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Retirement and Adult Children

Feb 14, 2020

Retirement strategy and finances calculator writing formulas
Supporting a family can put a crimp in your strategy

Families are one of the great joys in life, and part of the love you show to your family is making sure that their basic needs are met. While that’s only to be expected from birth through the high school years, many households are helping their adult children well into their twenties and beyond at the cost of their own retirement savings. (more…)

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Where Will Your Money Come From After You Retire

Feb 10, 2020

white Question Mark Written on black chalkboard to retire
Retirement income may come from a variety of sources

For many people who retire, income may come from a variety of sources. Here’s a quick review of the six main sources: (more…)

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Retire Single

Feb 7, 2020

Retired Person Sitting on Bench in Desert
If you are retiring single, income replacement and staying socially engaged should be considerations.

About 6% of Americans 65 and older have never married. That statistic comes from a 2018 Census Bureau report, which also found that 22% of Americans aged 65-74 live and retire alone. (more…)

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The Secure Act

Jan 17, 2020

The Secure Act What You Need to Know
Long-established retirement account rules change.

The Setting Every Community Up for Retirement Enhancement (SECURE) Act is now law. With it, comes some of the biggest changes to retirement savings law in recent years. While the new rules don’t appear to amount to a massive upheaval, the SECURE Act will require a change in strategy for many Americans. For others, it may reveal new opportunities. (more…)

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More Insights

Apr 3, 2020

“Every decade or so, dark clouds will fill the economic skies, and they will briefly rain gold. When downpours of that sort occur, reach for a bucket.” —Warren Buffett

Apr 2, 2020

From Our Partners at PAI: The CARES (Coronavirus Aid, Relief, and Economic Security) Act has been a topic of discussion for weeks as legislators discussed the best way to give Americans a much-needed boost as the economy has faltered due to the Coronavirus. Signed into law in late March, there are several provisions that will … Continue reading “CARES Act and Coronavirus Relief”

Apr 1, 2020

Factor #1 in our Road to Recovery Playbook is finding confidence in the peak of COVID-19 cases in the United States.  At Epic Capital, we are monitoring this factor daily, and we wanted to provide an update into what we are seeing. As shown in the Chart of the Day, while the number of new … Continue reading “Road to Recovery: COVID-19 Case Update”

Mar 30, 2020

The big equity bounce has continued, with the S&P 500 Index up more than 17% from the multi-year lows hit last Monday. The big question on many investors’ minds is could this be a bear market rally? After all, some of the most spectacular short-term bounces took place during bear markets.

Mar 27, 2020

Market gives up some gains into the weekend. Following the historic run over the past three days, US equities are lower in early trading Friday. The United States now has more confirmed cases of COVID-19 than China, though far fewer deaths. The stimulus package is expected to pass through the House of Representatives today before … Continue reading “Market Update: Friday March 27, 2020”

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