favicon 72t professorIf you’re looking into setting up a 72(t) distribution, here are a few reasons why you should hire an experienced financial advisor?

We have effectively set up 72(t) distributions for penalty-free income many times throughout almost 50 years and this strategy works, if done correctly…

The IRS Is Unforgiving.

Once 72(t) payments start, they cannot be stopped or modified for any reason.  If payments are modified in any way other than due to death or disability of the IRA owner, a 10% Federal Income Tax penalty PLUS interest will be retroactively applied to the payments beginning with the first year of the distributions/payments.  This means that if you are in Year #4 of taking 72(t) payments and you violate the rules, you will have to pay this 10% tax penalty (and interest) on the entire amount you have withdrawn over the first (3) years and not just on the amount you violated in Year #4 of your 72(t) commitment.

Remember… Substantially Equal Period Payments (SEPP) from your 72t IRA cannot be modified for (5) years or until Age 59 ½, whichever is longer.

Make sure you work with a Financial Advisory Firm who is experienced and knowledgeable in this specialized area.

Knowledge is Power. Mistakes can be very costly.

 

favicon 72t professorFinancial Markets Are Challenging

We just celebrated the 9 year Anniversary of the most recent stock market “bull run” which started March 9, 2009.

Does the stock market go straight up forever? Are you concerned about another correction? Do you have a “Correction Protection” strategy in place now?

Do you remember what happened in years 2000-2002? Do you recall the “dot.com” bubble burst? (S&P 500 index was down 49%)

Imagine retiring in 2007, right before the last financial crisis/recession… Could you afford to lose 30%, 40% or 50% or more of your hard-earned retirement savings in the next market setback/crash? (S&P 500 was down 57%)

See the S&P 500 chart for the past 20+ years  (December, 1996 thru Feb, 2018). Notice that the stock market increase from October 5, 2002 to October 9, 2007 (+101%) just got people back to even from the Year 2000-2002 dot.com bubble (-49%). This assumes that you had the nerves and fortitude to stay fully invested. Remember, if you lose 50% of your money due to market losses, you need to earn 100% just to get back to even.

72t professor JP Morgan price index chart

What do you think? Draw the next line on this chart. What is your investment plan?

Let us show you the various options that work well with the 72(t) Distribution Strategy (“Risk-Based” options  ~vs~  “Market Insured” options).

 

favicon 72t professorFee Based Comprehensive Financial Management

 

This financial advisory approach assures you of an individualized examination of your financial concerns and goals. All services you require are “wrapped” in a fee-based approach that eliminates any conflict of interest that might exist in a traditional commission approach.

You will have a financial adviser on retainer who will:

  • Create a personal investment policy statement with you a road map to your financial future.
  • Help you design and implement asset allocation strategies seeking maximum performance within acceptable risk exposure.
  • Monitor money managers performance.
  • Assist you in examining all phases of financial concerns: From retirement, college funding, life, disability & long-term care insurance, estate and tax planning, to gifting and charitable planning.
  • Periodic reviews to answer questions and review portfolio performance in relation to your stated goals and objectives.
  • Work with other professional advisers to integrate your investment, tax, business and estate planning matters.
  • Keep you on track through difficult market conditions and informed of changing laws and planning opportunities.
  • Superior reporting, tracking & accountability with monthly or quarterly reports that are easy to read and clearly shows your portfolio positions and progress.
  • Your fee is based on the value of your portfolio. The advisery fee goes down if the value of your portfolio goes down. This gives your adviser a financial incentive to seek the successful growth of your portfolio.
  • The advisory fee includes valuable services essential to a successful financial plan.
  • No proprietary investment products are used.
  • No loss of working capital due to expensive front-end loads or fees.

 

We can work together either on a commission-based relationship (Market Insured products i.e. Annuities) or on a fee based relationship.

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