ABOUT HOSTS

Joe Anderson
ABOUT Joseph

As President of Pure Financial Advisors, Joe Anderson has led the company to achieve over $2 billion in assets under management and has grown their client base to over 2,160 in just ten years of the firm opening. When Joe began working with Pure Financial in 2008, they had almost no clients, negative revenue and no [...]

Alan Clopine
ABOUT Alan

Alan Clopine is the CEO & CFO of Pure Financial Advisors. He currently leads Pure Financial Advisors along with Michael Fenison and Joe Anderson. Alan joined the firm about one year after it was established. At that time the company had less than 100 clients and approximately $50 million of assets under management. As of [...]

Published On
December 30, 2017

How Trump’s new tax law, the Tax Cuts and Jobs Act, changes state and local tax deductions, brackets, the child tax credit, medical deductions, property taxes, mortgage deductions, home equity debt, charitable contributions, itemized deductions, alternative minimum tax, residential gain on sale exclusion and small business taxes. Plus, the top things no one tells you about retiring, Social Security claiming strategies, and do Roth TSP and Traditional TSP dollars “commingle?” And the Ghosts of Joe’s Christmas past, or “oh s***, Ruthie stole baby Jesus.”

Show Notes

  • (1:10) Ghosts of Joe’s Christmas past: Oh s***, Ruthie stole baby Jesus
  • (10:10) The Taxes Rundown
  • (26:15) Big Al’s List: 6 Things No One Tells You About Retiring – Motley Fool
  • (44:15) Email Question: Claiming Social Security

 

Transcription

Should I be deferring more in my 401(k)s? Should I be doing more Roth? Should I do conversions? Should I not do conversions? Am I a small business owner? How do I set this up? Does an S-corp make any sense anymore? Should I switch to a C corporation? If I’m a partnership, do I go to an LLC? So what structure of business do I want to have, if I’m a small business owner? What type of business do you have? Is it a service business? Then no, that doesn’t apply. It doesn’t make any sense sometimes! – Joe Anderson, CFP®, Your Money, Your Wealth

That’s just a short list of questions that come up as a result of President Donald Trump’s new tax law, the Tax Cuts and Jobs Act of 2017. Today on Your Money, Your Wealth, Joe and Big Al discuss the changes to deductions, tax brackets, the child tax credit, charitable contributions, alternative minimum tax, small business taxes and a whole bunch more. Plus, the top things no one tells you about retiring, Social Security claiming strategies, and do Roth TSP and Traditional TSP dollars “commingle?” What exactly does that mean, and what happens if they do? Now, kicking off the final episode of Your Money, Your Wealth for 2017 with the Ghosts of Joe’s Christmas past, or “oh S***, Ruthie stole baby Jesus,” here are Joe Anderson, CFP® and Big Al Clopine, CPA.

1:10 – Ghosts of Joe’s Christmas past: Oh s***, Ruthie stole baby Jesus

JA: This week, once again, we’re talking taxes. But I think we might narrow it down to what the heck is really going on out there and get some clarity.

AC: Well, we do have some clarity – at least “some” clarity. Not all is known in this new tax bill that the House and Senate have approved. There are some big changes, and you’re right, I think the last big change was 1986 – the Tax Simplification Act under Ronald Reagan. But Joe, I think first of all I want to say happy holidays to all of our listeners out there. Happy Hanukkah. Happy Christmas. Happy Kwanzaa, whichever it may be.

JA: Happy Christmas?

AC: Merry Christmas. (laughs)

JA: Merry Birthday?

AC: Yeah. I’m going to give you a little background, here. Hanukkah. It’s an eight day festival of lights. The dates which actually shifts slightly every year because the Hebrew calendar and the Gregorian calendar did not exactly align, so it began, actually on December 12th of this year. It’s actually already over by the time you’re listening to this, it ended on December 20th. And it came about thousands of years ago, a Syrian king wanted all the Jews who were part of his kingdom to drop their Jewish culture and follow Greek customs. And as you might imagine, the Jewish people did not want adopt the Greek culture, and they decided to fight back against the Syrian King, in defense of their religion and culture. And during the rebellion, a Jewish temple was ransacked and the supply of oil contained in it was destroyed. But the Jewish people won the rebellion, and celebrated their victory for eight days. Hence, that’s Hanukkah. Christmas, I think a lot of us know about that, and it’s the birth of Jesus. But Kwanzaa. Do you know what Kwanzaa is all about? I’ll tell you.

JA: Thank you.

AC: (laughs) It starts on December 26 and goes through January 1st. Kwanzaa translates to “fruits first” from Swahili. It’s a seven day holiday that’s celebrated by African Americans and Africans throughout the world. And unlike Christmas and Hanukkah, Kwanzaa is not a religious holiday. It was actually established in 1966 to encourage the celebration of African heritage, and gatherings between families and friends is what happens – people get together for unity, self-determination, collective work, and responsibility. So that’s Kwanzaa. So, Happy Hanukkah, Merry Christmas, and Happy Kwanzaa.

JA: There you go. Thank you Al, for that little lesson.

AC: Something else…

JA: What do we got here?

AC: Were you aware that there’s a woman in Vermont that displays more than 1,400 nativity scenes in her home each year? Almost makes the trip to Vermont worthwhile over Christmas. Do you have a nativity set? Do you know what a nativity set is?

JA: No.

AC: (laughs) That’s where you have the little barn, and Joseph and Mary, and the little baby Jesus and the donkeys.

JA: Oh yeah – no, I do have story about one of those though.

AC: You do? I know we have at least one, because it’s up in our house right now. But anyway, we probably have two or three, but not 1,400. That’s that’s impressive. She kinda transforms her home into a museum.

JA: She’s gotta have a pretty big home.

AC: (laughs) Well, I guess – it says a modest home, I don’t know what that means. But she welcomes school children, church groups and other visitors by appointment. So maybe there’s still time, if we can get over there, get an appointment.

JA: There’s a lot of plays going on now, for school and church and so on. I was a shepherd, probably in fourth grade, something like that.

AC: Was there for a play or was that for church?

JA: It was a church play. Christmas, whatever. So I’m dressed up as the shepherd. And my line…

AC: You had a line?

JA: Yeah I had a line. This was my first line of stardom. And my line was, “well, let’s go see what glorious thing has been done.” Something like that. Because we were hiking to see the birth of Christ – baby Jesus. So I totally blew it. Totally botched it. I said, “let’s go see what has done wrong.” (laughs)

AC: (laughs) And so what are you supposed to say?

JA: It was the birth of Christ! It was supposed to be like, “hey let’s go see this wonderful thing that has happened.”

AC: Let’s go see what’s been done wrong.

JA: Yes. And then I said “Oh S—” (laughs)

AC: No you didn’t. (laughs)

JA: Yes I did. Right in the microphone. (laughs)

AC: In a church play? (laughs)

JA: Yes. In fourth grade. (laughs) My parents were mortified. The walk home – the church was a couple blocks.

AC: Did you get any laughs though?

JA: I don’t know, I was petrified.

AC: You were embarrassed. That was the start of your stardom. You were destined for radio. Not plays.

JA: Yes, destined for radio, not a thespian. So there was this one Christmas we had at my my aunt’s house, and no one really wanted to go, because she had this apartment in not a very good part of town. And she rented out the party room.

AC: Was this in Minnesota?

JA: Yeah, this was up north Minnesota. So the whole family, mom and dad, my brother, sister, cousins, aunts, uncles were all gathering in this party room, and there was some adult beverages that were taken part by my family, my aunt and uncles and mother and father. And so we were leaving. And so I was, I don’t know, I was probably, I don’t know, maybe in high school. And there’s one of these – what is it called? The things that the shepherds and the wisemen and baby Jesus around? The one that she’s got 14,000 of?

AC: The nativity?

JA: The nativity set. But it was wired with an alarm system. Because it’s not in a very good part of town. So if someone wanted to steal a wiseman, a piece of a nativity scene… (laughs)

AC: Or baby Jesus. (laughs)

JA: So we’re leaving. So I went to my mother, Ruthie, and I was like, “hey Ruthie, I think would be really cool if we took a picture of you holding baby Jesus.” And she’s like, “Oh, I think that would be wonderful!” So she picks up the baby Jesus. And next thing you know (Joe makes siren sounds, laughs) the alarms start going, like oh my God, she’s freaking out, she’s holding the baby Jesus.

AC: County sheriff shows up.

JA: Yep, security is out. Oh my God. She was going to steal baby Jesus.

AC: I can just see that county sheriff – “Ruthie, not again.”

JA: She almost went to the clink just by holding baby Jesus.

AC: Well in case you’re interested, Shirley Squiers is the Vermont lady. The article came out in the Associated Press on December 21st, 1,400 nativity scenes in Vermont.

JA: Wow. 1,400. That’s a lot. That is quite a bit.

That’s it, next year I wanna spend Christmas with Joe and Ruthie – they clearly know how to have an exciting holiday. We’re about to get into how tax reform is to affect your retirement plan. And the problem with your current advisor or stockbroker is, you’re probably only getting one small sliver of the entire retirement story. That’s a problem, because chances are you’re missing the most significant pieces of the Retirement Puzzle. In order to retire successfully and comfortably, you need the whole story, and everything needs to work together. You can see that with our personalized assessment. There’s no cost or obligation, you have absolutely nothing to lose. In this customized, face to face meeting, you will discover concrete steps to mitigate your risk. Simple strategies to convert your savings into income in retirement. How to avoid the retirement tax trap that could needlessly cost you tens of thousands of dollars in taxes, penalties and fees. And how to protect everything you worked for from the surprising cost of health care, Medicare and long term care. Plus, how to avoid the simple retirement planning mistakes that could cost you thousands. This analysis is ideally suited for people who are recently retired, or retiring in the next five to 10 years. If you learn one thing in this meeting, it could change everything. Get yours by calling 888-994-6257 that’s 888-994-6257. Don’t leave anything to chance. Call right now 888 994 6257 that’s 888-994-6257.

10:10 – Taxes: State and Local Deductions, Brackets, Child Tax Credit, Medical Deduction, Property Taxes, Mortgage Deduction, Home Equity Debt, Charitable Contributions, Itemized Deductions, Alternative Minimum Tax, Residential Gain on Sale Exclusion, Small Businesses

JA: Major tax reform doesn’t happen every day. Every 30 years or so, and I think we finally got a little – I would say, on the individual side, it’s not reform, it’s probably tax tweaks, if you will. But I think on the corporate side it’s definitely some significant change.

AC: There’s some big changes and you’re right. I think the last big change was 1986, the Tax Simplification Act under Ronald Reagan. This is called the Tax Cuts and Jobs Act. And this was actually passed by our Senate on December 19th, and the House on December 20th. Most importantly though is, virtually all provisions take effect on January 1st, 2018. In other words, next month, 2018. And I would say this, Joe, the majority of taxpayers will probably pay less in taxes, although there are many exceptions. One of the exceptions – we’re recording this in California, and if you’re in California with mid to high income, you potentially will pay a little bit more tax, because the loss of the state and local tax deduction. But I think I just want to highlight some of the major provisions, because we’ve been talking about this the last several weeks, and it’s hard to talk about, because every week it’s something different. But this is now what it is going to be.

We’ll have seven tax brackets, the lowest rate’s 10%, the highest rate’s 37%. That’s compared to right now, we have seven tax brackets, from 10% to 39.6, so on the surface it seems similar. But I will tell you this: every single tax bracket is lower, except for that first 10% rate. Every single tax bracket is lower than what it was before, and the standard deduction will basically double. So single person will be $12,000, married person will be $24,000. As you may know, a standard deduction is what you claim – you claim the higher of that or itemized deductions. So less people will need to itemize. And the idea there is to make taxes simpler. They are disallowing exemptions, which is $4,050 per person. So you might think, “well, families with lots of kids might be hurt by this,” but then they doubled the child tax credit from $1,000 to $2,000. So I think families with kids 16 and younger will probably, in general, still be OK. The medical deduction was retained.

JA: I thought it was 17 and younger.

AC:16 actually – younger than 17. But yeah, keep challenging me. For that at 16, under 17 – for that particular credit. Medical deduction is retained. There was, in the House bill originally, it was eliminated. But it’s been retained, and not only that, improved slightly in 2018, 2019, it’s going to be 7.5% of adjusted gross income, down from the current 10%.

JA: So that 7.5% was for people that were 65 and older? And then if you were under 65 then it was 10%, but now across the board it is 7.5%. Anything over 7.5% of adjusted gross income is deductible as a medical deduction.

AC: That’s correct, Joe. Although, it was going to switch to 10% for all taxpayers I don’t recall whether that was ’17 or ’18, but that was that was coming. The state and local tax deduction. That’s the big one. So California, or New York, or New Jersey, you pay a lot of state taxes. So that used to be a deduction on your federal return. No longer. With one caveat, you can actually calculate and include on your tax return, your state and local taxes and property taxes. And then you sum up that total, and the IRS says that you can take $10,000. So if your property taxes are $8,000, and your income taxes are $8,000 – that’s state taxes – that’s $16,000. You can take $10,000. Doesn’t matter, any combination of those two.

The mortgage deduction essentially stays the same, with one exception, and that is, at the moment, or before this law, you can borrow up to a million dollars on a property, and deduct all the interest. Now it’s down to $750,000. That would be the highest mortgage. But there is a grandfathering rule. If you had the million dollar loan before December 15th of 2017, you’ll still get to deduct the interest on that loan. There is a bigger change though, with regards to home equity debt. So home equity debt is when you get a home equity loan and borrow the money for any purpose that you want to. The old law was you could deduct interest on $100,000 of debt. The new law is no deduction whatsoever, no grandfathering in. That starts in 2018.

Charitable contributions have been retained. So that’s good news for charities and people that want to give to charities. Miscellaneous Itemized deductions are repealed. They’re gone. Unreimbursed employee expenses, tax prep fees, investment fees, can no longer take those. Capital gains. No change there. There’s three rates, 0, 15 and 20%. So you’re good there. Alternative minimum tax was one that we thought was maybe going to go away, but it’s retained, but with higher exemption amounts. And Joe, I would say a lot less people will be subject to AMT.

JA: Virtually almost no one.

AC: Yeah because the reason why you’re in AMT is because of the state and local tax deduction, which if you can’t take it, there’s not going to be as many people in it.

JA: Right, because alternative minimum tax came into play with large deductions. That’s why AMT came in in the first place. And so while they’re eliminating a lot of the itemized deductions, or reducing them, it’s going to be hard. And plus now the AMT exemption is that much larger. So it’s going to be pretty hard to fall into AMT.

AC: The only thing that may happen is, the rates are lower, and the AMT rate stayed the same. So there could still be some people in it, but not as many as they used to be. Here’s a big one, estate taxes, the exemption doubled. So now, if you pass away, if you’re single, $11.2 million goes to your heirs, beneficiaries, tax free, if you’re married it’s $22.4 million. If you have estates above that, it’s a 40% tax rate. The residential gain on sale exclusion, that’s been retained. There was talk about making that less valuable in two ways, by making it that you had to live in your home five to eight years. And that there were phase outs of at certain income levels. None of that made it into the final conference bill, so the $250,000 exclusion for single, $500,000 exclusion for married is still there for somebody that’s lived in their home two out of the last five years.

JA: Talking a little bit of taxes here today, and kind of going through some high level tax changes. We could really get into the weeds, but here’s the thing is that they tried to make this simpler. And there’s nothing real simple about this.

AC: Not particularly – and particularly when you look at small businesses.

JA: You all right there? (laughs)

AC: I’m choked up about this tax law.

JA: Big Al’s about to cry.

AC: You look you look at small businesses, Joe, and so the idea was to lower the tax rate. But there are so many limitations on this. Certain kinds of businesses, like service businesses, don’t qualify. And then it’s like only a certain amount of your income, you get a special rate on, and then it’s phased out if your income’s too high. And all kinds of businesses don’t qualify. So anyway, it’s going to take a while to sort of wrap our heads around that one.

JA: Here’s the thing, too. When it comes to the individual side, they’re like, “OK well let’s make this simpler. You can file your return on a postcard. Let’s make the rates from seven to three. And no deductions at all.” It’s like OK, well we still have seven rates. You’re just kind of tinkering around with the rates, and then we got rid of some large deductions. So we have a lower marginal rate, but then we can’t write off a lot of the deductions that we used to be able to write off to lower our taxable income. So I have a higher taxable income at a lower rate. Does that equal lower taxes, potentially or potentially not, really depends on your overall situation. You got to narrow this stuff down to figure out exactly what type of planning is appropriate for you. Because I think the planning that might have been appropriate for you in the old tax law, might be completely different with the new. And then there’s different loopholes that will probably starts screaming out of here, because they push this thing through so quickly.

AC: Yeah. First off, I think a bunch of employees are going to try to become independent contractors, so they can get a lower tax rate. I think that’s a given. I think certain companies will split into two companies. So they have some of their income as pass through and some of their income as a C corporation, to take advantage of lower rates. I think they’ll be more family shifting between members, so you’re in different tax brackets, again, to take advantage of lower rates before the phase outs. That’s the thing about taxes, and I think a lot of people don’t necessarily understand that. I get this question, “Why don’t we have a flat tax?” or “Why don’t we have a simpler tax system?” I would love to have a simpler tax system. But then you start thinking about it, it’s like – what does a flat tax mean. Well it means you just pay 10% on your income. That’s the flat tax. Well what’s income? Well, salary. OK, I get that. So you get to deduct your 401(k)? Well, you still get to deduct your 401(k). Well what if you’re a business owner and you have your own business, you don’t have a salary? Well, it’s on the profits. So you have to have all those rules with regards to expenses, what’s deductible what’s not. And if you sell a piece of real estate, you have to pay tax on the entire sales proceeds? Well no, it’s only on the gain. Well then you have to have all those rules. And then on and on and on. There’s no way to make this simple. Now, I guess in a sense, they kind of did, because they raised the standard deduction, less people are going to itemize. And if you don’t itemized deductions it is simpler. And if you don’t have anything unusual on your tax return.

JA: But some of the stance that I read is that right now 70% use the standard deduction, 30% itemize, something like that?

AC: Yeah. More itemized in California of course, because of our higher taxes and higher wages, but yes.

JA: But look you look at the median income is $70,000. Median household income. So if you look at most people’s income that are at $70,000, God bless them, but they don’t listen to this show. They’re not necessarily concerned with taxes. So the people that actually itemize, that are paying a lot of taxes, that are looking for different ideas and strategies on how to reduce it, because it’s our given right as a US citizen to do everything we can to reduce the amount of money that we pay to tax…

AC: You memorized that, didn’t you? (laughs)

JA: Yes, because it’s true and I believe in it! I think it’s right on! (laughs) And if you understand the tax code, then it’s like OK well let me just see what I can do legally to make sure that I’m doing everything I can to put more money into my pocket. I want to pay my fair share. Don’t get me wrong. But at the end of the day, I want to make sure that I understand all of this.

AC: Yeah, you follow the rules. You lower your taxes, and the tax code is there for you.

JA: Right. How many people – and I don’t want to get political, but I would imagine – how many people actually do you think read the bill, that voted for this?

AC: Not many. I am a CPA, and I started to read it, and there’s no way. First of all, it’s like 1,100 pages. So the first 500 pages, give or take, is legalese. They quote the code section, we’re going to delete the section, and add this one, and strike this word, add that. It’s like, there’s no way you could make any sense of that. And I understand if you’re rewriting it, and you need that. But the last five or 600 pages is the narrative, that’s a little easier to read. But it’s still very complicated, and if you’re not a CPA, even if you are a CPA, this is hard stuff. And so can you imagine our senators and congressmen and congresswomen? Did they have a chance to read it and digest it? Unlikely. And I don’t want to get political either, but yeah, that’s the reality of it. And so, what’s, in my opinion, in my view, Joe, what will happen is, there will be issues and inconsistencies with the tax law, which happens virtually every time, because there’s no way you can think through everything. In this particular case, I think this was kind of pushed through more quickly than normal, which probably means there’ll be more issues. And when that happens, we’ll have future bills, they’ll call them technical correction bills. They’ll correct whatever was wrong, whatever they didn’t intend to do. I would expect a fair amount of that over the next few years.

JA: So yes, it’s going to take a little bit of time to digest all of this, to kind of understand, really, how is it going to apply to your overall situation. But I think the sooner that you jump on this, the better. Most people do tax planning at the end of the year. And I think that’s a bad move. I think you want to get a jumpstart in this in January, to look at what’s the code? What am I looking at here? Should I be deferring more in my 401(k)s? Should I be doing more Roth? Should I do conversions? Should I not do conversions? To get more money into a tax free component? Am I a small business owner? How do I set this up? Does an S-corp make any sense anymore? Should I switch to a C corporation? Or do I look at, if I’m a partnership, do I go to an LLC? So what structure of business do I want to have if I’m a small business owner? Then all of a sudden you’ve got all these employees. So they’re jumping ship to say, no, I don’t want to be an employee anymore, I want to be a subcontractor. That’s great for me, then I don’t have to pay FICA tax on you. Nw you’re responsible for that. And then what’s the consequences of that? What type of business do you have? Is it a service business? No, OK well if I’m in real estate or if I’m an architect, then I can write through and get the lower rates, but if I’m an accountant, or if I’m in financial services, or if I’m attorney, a doctor, whatever, no, that doesn’t apply. It doesn’t make any sense sometimes. So you have to understand all of this, so I would encourage you to sit down earlier than later.

With how much the tax landscape is changing, you probably believe you don’t have any control over paying taxes, right? But that’s not true. In fact, you have more control over how much you pay in taxes in retirement – more so than at any other time in your life. But your stockbroker, your financial advisor, even your tax preparer may not understand how to lower taxes in retirement, because it’s not their expertise. The only way to lower your taxes in retirement is by having a forward looking, tax efficient strategy. Find out how you can legally pay fewer taxes than ever before with our new, personalized tax reduction analysis. In this analysis, you’ll discover techniques specifically designed just for you, on forward looking tax strategies keep more of your hard earned money in your pocket. There is no cost, and no obligation, so you really have nothing to lose. Get your complimentary personalized tax reduction analysis at 888-994-6257 that’s 888-994-6257.

Time now for Big Al’s List: Every week, Big Al Clopine scours the media to find the best tips, do’s and don’ts, mistakes, myths and advice to improve your overall financial picture – in handy bullet-point format. This week, The Top Things No One Tells You About Retiring

26:15 – Big Al’s List: 6 Things No One Tells You About Retiring – Motley Fool

https://www.fool.com/retirement/2017/11/20/top-6-things-no-one-tells-you-about-retiring.aspx

AC: Many of us do look forward to retirement, but sometimes there’s a few surprises that happen. We can sort of comment on these, whether you agree or not, but the first one is required minimum distributions can seriously raise your costs. And of course, they’re getting into taxes. And a lot of times, people retire in their 60s, and they’re living off their savings, snd they’re thinking, “Gosh, I don’t know what Joe and Al were talking about, this retirement, it’s tax free, I’m not even paying any tax.” And then 70 and half comes by, and then now they got their required minimum distributions, which means you have to take money out of your IRA and 401(k)s. You may be taking Social Security at that point, which could be as high as 85% of that being taxable. So all of a sudden, you’re in a much higher bracket. And also Joe, I think a lot of people don’t realize that every year that you age, you have to take a higher percentage out of the required minimum distribution. I’ve actually had people say no, it’s the opposite, because the numbers go down. No, that’s the division factor. In other words, you divide it with a smaller number, which is a higher percentage, if you think about that mathematically-wise. The truth though, is that you have to pull more money out when you get older.

JA: Al and I do a competency test to advisors that want to join our firm, and we’ve done this for the past, I don’t know, when did we start it, 8 years ago? We made some mistakes early on. We’re like, getting a little technical. It’s a fairly easy test.

AC: Yeah it’s not hard. We go over kind of a basic case and just ask them questions about the case.

JA: And hundreds of individuals have gone through this test. And how many, what percentage of advisors – and they have to be a Certified Financial Planner. And I don’t want to rip on the industry, but I’m just saying this is how complicated some of this stuff can be. The average Joe needs to understand all of this for their own specific situation. It’s in this article. Number one confusion is that, “wow, I’m going to be paying a little bit more tax, or these RMDs are a little bit different than I anticipated.” Most advisors really don’t understand it as well. I don’t think it’s their fault, because the industry has been really good at helping and training individuals advisors and brokers and whatever, to help individuals accumulate wealth. “Here, save x amount of dollars, here’s your portfolio. Get the right insurance coverage. Get an estate plan. Look at property casually insurance.” But now you got this big wave of baby boomers retiring and now it’s…

AC: “Oh, you don’t have a pension. You have an IRA. How do we devise the cashflow strategy, or how does that even work?” Yeah we do, and you’re sort of going to – not all the advisors do well. In fact I would say the majority that come into our office applying for a job really did not do that well on this topic.

JA: On looking at tax implications of retirement income in retirement.

AC: Yes. So it’s something to be aware of. And if you have a parent who’s recently in their 70s, or maybe now 75-80, and they saved a life in their IRA, they’re probably complaining to you about these required minimum distributions. This is kind of the first time we’re hearing about this, because these accounts are not that old. Second thing Joe, Medicare premiums can eat up your Social Security increase. Boy that’s true.

JA: I played golf with a client of ours, and he’s like, “Joe, why the hell does my Social Security keep going down every year?” And I was like, “well, I don’t think it’s going down. I think the deduction is going down because your Medicare premiums are going up, and your Medicare premiums are deducted from Social Security, and your Medicare premiums are based on adjusted gross income. And it’s means tested. So the higher the income you have that’s adjusted gross income, then that means your Medicare premium will go up.”

AC: Right. And if you’re not yet receiving Social Security, the way that they do this is, whatever your benefit is, they subtract the Medicare premiums out of it, so you get a net figure. And so Joe, on average since 2015, Medicare, the Social Security check, has only gone up $8. (laughs) It’s gone up more than that, but the Medicare premiums keep eclipsing that. And so don’t necessarily expect to be receiving more and more in Social Security each year.

JA: Right. Even though the COLA of Social Security, even if your income stays the same, your Medicare premiums are increasing as well, just with their COLA factor.

AC: Number 3, it gets substantially harder to wait out a bad market once you retire.

JA: Of course, because that’s all you’re doing is looking at your money when you retire.

AC: (laughs) So many mistakes we’ve seen – people, they recently retire, and let’s say they’ve got too aggressive of a portfolio, they hadn’t really thought this through, because they need cash flow. And so then they get freaked out and they sell everything, and now they’ve basically gone from one extreme to the other. It’s very common.

JA: Totally. And when you don’t have a lot of money, when you’re working, and you’re pumping away it’s your job, just throwing money at your 401(k) plans, you’re not necessarily looking at it daily. But once you stop working, you got a little bit more time, and that nest egg, man, that’s a ticking time bomb.I cannot let this thing blow up.

AC: No, because when you work and you don’t think about it. I don’t care. Yeah, it goes up, it goes down but it tends to go up for the long term

JA: And I’m adding to it, so if it goes down a little bit I don’t even know, because it’s actually going up because of my contributions.

AC: Here’s number four, you could finish retirement, which I guess is another way of saying, “you die.” You could finish retirement with a larger nest egg than you had when you started it. That’s definitely true.

JA: Absolutely, that’s a goal.

AC: That’s a goal. And sometimes we’ll have people come into our office that say, “Joe, Al, I want to spend the last dollar, bounce the last check, the kids are fine. I don’t really have any charities,” And then we look at their spending and we look at their assets. And they’re spending let’s just say $50,000 a year, and we look at their pension, Social Security, their required distributions. They could be spending $150,000. So we say, “well, then you need to spend $100,000 more.” “There’s no way it’s possible. Maybe $5,000 more, but I’m not going end up with a dollar.” It’s like, “well something has to happen. Either there’s going to be a big pile of money, or you’re going to give a bunch of money to your kids or to charity, or you got to start spending more.” And it does happen.

JA: Savers are awful spenders.

AC: They are. And that’s why they save.

JA: We’ve got to prod them to spend. “Spend more money, please.”

AC: It’s hard to turn that off though, when you’re used to doing that. I think I got time for one more. You still have 24 hours in your day, seven days a week. And they’re getting into, you gotta fill your days, because depression is a widespread issue among retirees.

JA: Yeah. When you’re bored, having tequila at 10am.

AC: (laughs) Is that your retirement?

JA: Could be. The clear liquid. (laughs) But it happens.

AC: An awful lot of people are now going back to work after they retire. Not so much because they need the money, just because they want to be productive, they want to have a group of friends, they want to socialize, they want to have a reason to get up every morning. Then there’s lots of people that are totally happy volunteering, or gardening, or whatever, but just make sure you get something to do.

JA: Yeah. Some people are petrified of retiring. I think at first they’re like, “yes, I can’t wait, and I’m so done with this job” and everything else. And then they get into it, six months in, “is it everything you thought it would be?” “Not really. Kind of bored. I’m bored.”

AC: “In fact I’m trying to get a consulting job.”

JA: Yeah. So don’t let that happen to you. There’s things that you can do right now.

Taxes don’t stop when your paycheck does. In fact tapping your retirement nest egg comes with all sorts of new rules and opportunities. Instead of contributing to tax deferred plans that reduce your taxes, you’ll start tapping those savings for income, and paying taxes at your regular rate, unless you’re tapping into a Roth IRA. So as you near retirement, tax planning becomes more important than ever. But you must use a forward thinking tax strategy. because you have more control over paying taxes in retirement – more than you think. Actually, more so than any other time in your life. Find out how you can legally pay fewer taxes than ever before with our new personalized tax reduction analysis. In this analysis, you will discover techniques specifically designed just for you on forward looking tax strategies to keep more of your hard earned money in your pocket. There’s no cost and no obligation, so you really have nothing to lose. Get your complimentary tax reduction analysis at 888 994 6257. That’s 888 994 6257.

36:07 – Email: Traditional TSP, Roth TSP and commingling

JA: “Hello Joe and Alan, faithful listener here. You mentioned those folks with a good 401(k) with a Roth component. I have a TSP being a “govvy.”” At first when I read this I thought he was saying groovy. I was like, “what the hell is groovy?”

AC: That was a word from my generation.

JA: Yeah groovy. When I think of groovy, I think of Greg Brady.

AC: Yes. That would be perfect. I think of bell bottoms and leisure suits.

JA: Totally groovy. So Mike has a TSP. It does have a Roth component within the TSP. “However, I was told that they mix all the money together. This was from one of the folks teaching a pre-retirement workshop. These are just contractors hired to teach these courses, then TSP just keeps track what is before tax and Roth. That way, when you remove funds X, before tax percent is taxed, and the other percent, Y, Roth, is not taxed. I was wondering if you have the real breakdown on this.” Well, Mike, of course we do. (laughs) You came to the right place.

AC: Well this sounds like a question for you.

JA: Well, this is how all 401(k) plans work, is that you put dollars into a 401(k), either pretax or after tax. I think you get a tax deduction, grows tax deferred, when you pull the money out, you pay ordinary income tax. Then the Pension Protection Act of ’06 came along, and came up with the Roth component of a qualified 401(k) plan, 403(b), TSP, 457, so on. And so it took a while for some of these bigger plans to adopt. The TSP adopted the Roth component a few years ago. So now if I’m a government worker, I have the option to do a pre-tax election, to let my monies grow tax deferred, and then pay tax on the way out, or I can put an after tax election to go in. Then the money grows. And then when I pull those monies out, I’d pull it out tax free.

AC: Or you can do a combo.

JA: Oh sure, I could do $10,000 pre-tax, $10,000 after tax. Whatever you want to do, up to $18,000 if you’re under 50, $24,000 if you’re over 50, in a couple of weeks it’s $24,500.

AC: That’s right, or $18,500.

JA: Okay, so the question is what the hell are they doing behind the scenes here? It’s just record keeping, in a sense. I don’t know what they mean by “bundling it all together.” You’re putting dollars into funds. You do actually have two separate accounts, but it’s all consolidated on one statement. There’s a record keeper behind the scenes saying, “OK these are pre-tax,” because it can’t be bundled as one, that doesn’t make any sense.

AC: You can’t really commingle. I’ve heard the term “sub accounts” so that you have one regular TSP, and a sub account of a Roth TSP.

JA: Well sub account is actually a mutual fund like account that’s in a variable annuity, but I digress. (laughs)

AC: (laughs) Well Jeez! No, I’ve actually heard it used in that context.

JA: Really? Look at the big brain on Big Al. (laughs) Because if you think about it like this, if it’s all mashed together, you have one dollar that you put into one fund that was after tax. And maybe you used the S fund. And then you have another dollar that you put in pre-tax that’s in a G fund. Well which one is going to grow more over time? The G fund is cash basically, and the S is in stocks. So probably the stock fund. So I want the stock fund to go in the Roth, because then all of that future growth grows tax free. So they do that behind the scenes. So in Al’s terms, they have sub accounts. You have your pre-tax monies, and you have your post-tax monies, but then you get a consolidated statement, and you get one statement that says, “Here’s your TSP balance, $300,000.” And then it might have sub lines on it, here’s post-tax, pre-tax.

AC: So it seems like it’s commingled but it’s not.

JA: It’s not. And then when you pull the dollars out, this is where it gets a little bit more convoluted, because it’s pro-rata. So to make it real simple, I have $400,000 in my TSP. I’ve $200,000 in the Roth. I’ve $200,000 in the traditional. Half Roth, half not. So 50% Roth, 50% non Roth. I take a dollar out of that account. How’s it going to be taxed?

AC: Well you’re saying pro-rata, so 50 cents tax free, 50 cents taxable. So you can’t choose.

JA: Right. If I had 75% pre-tax, 25% post-tax, I take a dollar out, 75 cents is going to be taxed, 25% is going to be tax free. So they’re going to do their pro-rata calculation when you take those dollars out, and then they send the forms to the IRS, and blah blah blah. So that’s why I love the Roth 401(k). I love the Roth TSP. I love the Roth. If you’ve ever listened to the show, and Mike, he says he’s a faithful listener, so he knows that we’re big fans of tax free income in retirement. But what I’m not a big fan of is keeping it in these plans. Because then, like Al said, you can’t choose. I want to pull $50,000 from my pre-tax to pay the tax only on $50,000. But I want to pull another $15,000 out, because I have added living expenses. But that might pop me up into a higher tax bracket. I want to pull $15,000 out of my Roth. Well, you can’t do that, because it’s all going to be commingled and it’s going to come out pro-rata.

AC: So in that sense it is commingled, at least on the distribution.

JA: So you have to roll the money out.

AC: Right. So if you roll the money out, you can actually take the Roth component, and roll that into a Roth IRA, and you can take the regular component, roll that into regular IRA. Now you can pick and choose. Two different accounts.

JA: Right. Then I’m saying, “hey, I’m pulling $50,000 from my retirement account, I’m pulling $15,000 from my Roth, oh wait a minute, I need $17,500 from my Roth.” You’re not subject to those pro-rata rules, because now they’re two separate accounts. And then you can have a lot more control over your taxes. And I think that’s the key component. Now with this crazy tax law, you’ve got tax brackets all over the place, you gOt no itemized deductions, we got a bigger standard deduction, no exemptions, but I got child credits. How you’re going to control all of this is key.

You’ve probably been with the same stockbroker or financial advisor for years. But friendships aside, when’s the last time you formally reviewed your portfolio? Are they actively managing it? Are you considering or having conversations about Social Security, taxes, health care and Medicare? If not, you’re missing some critical pieces of the retirement puzzle, and these things could make a profound difference in how far your money could go in retirement. We’ll prove it to you with our financial assessment. We don’t just talk about stocks bonds and mutual funds. We get into actionable strategies on how you can pay fewer taxes, how to wring every nickel out of your Social Security benefits. How and when to withdraw money from your retirement accounts, plus inflation, health care, Medicare, and so much more. We talk about how to make every dollar break a sweat and go further in retirement. Your initial analysis won’t cost you a dime, so you’ve got nothing to lose. Call 888-994-6257. What you learn in our assessment process could change everything. Get yours right now. 888-994-6257. 888-994-6257.

44:15 – Email Question: Claiming Social Security

JA: This is Barry. He’s in Nor Cal. “Joe, Al: Have a few questions regarding Social Security that I need some clarification on.” So, Barry, he’s 64 and will turn 66 in 13 months. “I’m aware that my benefit will continue to grow 8% a year until age 70, which would grow 32% over four years. Given the annual increase for 2013 was 2%, and let’s assume for the time being that the subsequent increase for the next four years will also be 4%. Will my net benefit actually only be 6% a year?” So I think what he’s confused on, is two things. One is that there’s a cost of living adjustment on the Social Security benefit, and then there’s also something that’s called an 8% delayed retirement credit. So once you reach your full retirement age. So when you turn 62 – people get this confused too. It’s like, you could claim your Social Security benefit as early as age 62. So if you take it at 62, it’s actually a reduction of benefit from your full retirement age. It’s an increase to your full retirement age, but how Social Security looks at it, it’s not like, well from 62 – let’s just say 66 is his full retirement age, just to keep it simple – is that it’s not an 8% increase from 62 to 70. What happens, you just got to work backwards. From 66 to 62, you would get a 25% permanent haircut.

AC: OK, so let’s do some numbers.

JA: So it’s about 6 and something percent per year.

AC: So let’s say you were going to get a $2,000 benefit at age 66. So if you take it at 62, it’s roughly $1,500. Now it’s a little different because the full retirement age is 66 and two months. Yes, but this is roughly true.

JA: So there’s two things that Barry needs to consider. So if he waits until full retirement age and doesn’t take his benefit. So now he has his full benefit, in your example, Al, $2,000 per month. So he’s like, “I’m not going to take it. I’m going to wait until age 70.” So he’s going to get that 8% delayed retirement credit, on top of his full retirement age benefit. He’s also going to get the cost of living adjustment as well. It’s both. So it’s 8% credit, plus whatever the cost of living adjustment is on the Social Security benefit on his full retirement age.

AC: Right. So the 8% credit per year over four years, he’d be getting a little over $2,600. So that’s a pretty big difference. You take it at 62 is $1,500. You take it at 66 is $2,000 a month. You take it at 70, $2,640.

JA: And that’s assuming zero COLA.

AC: Zero COLA. Zero cost of living adjustment. So when you have the cost of living on top of that, it adds to it. So anyway, that’s good news. So Barry, you can wait, and of course the question is should you wait. And it’s a different answer probably for everybody, but I think that the basic rule, I would say, is this…

JA: He’s got two more subsequent questions.

AC: Well I’m talking to the rest of our listeners. As a generality, if you can afford to wait, cashflow wise, and at least you or your spouse are in reasonably good health, then waiting would be a good idea.

JA: So here’s the second question. He’s considering working at age 67 and not taking Social Security. Then “at 67. will my earnings be part of my 35 year average and thus increase my monthly benefit? If so, is the 8% annual increase based on my earnings from 66 or age 67, or will the 8% increase supersede any possible increase I may get from an extra year of working?” So again, what happens is this. They take the highest 35 years of your Social Security benefit, no matter what age, whatever, and it’s indexed with inflation. So they’ll look at 35 years of earnings, and if you worked 35 years ago and you made $40,000, that could be equivalent to $200,000 today.

AC: So they adjust it to current dollars, based upon their inflation factor.

JA: So they’ll say “oh, 35 years ago, you actually made higher than you have today.” Even though it was a lower dollar amount indexed with inflation. Inflated adjusted it was higher. So they’re going to take the highest 35. If you do not have 35 years of work history, let’s say you have 30, then the five years that you don’t have, they’re just going to put zeros in those. So it’s an average over 35 years. So now I’m 67 years of age. And let’s say I take my benefit at 67, my full retirement age. I take my benefit, but I’m still working. So as I’m still working, I’m making more money than I did, and so those higher earning years are going to take place of the lower earning years. So they will recalculate that benefit each year. They’re never going to take money away from you, once you reach full retirement age. Your benefit will only increase if those earning record years are higher than any of the proceeding 35 years that you had.

AC: And it could never decrease. Because either you replace, like, a part time job with zero, or it just isn’t counted because you’ve got other higher years.

JA: So let’s say I didn’t work. I didn’t pull my Social Security at 67. I wanted to pull it at age 70. That 8% delayed retirement credit is based on your full retirement age benefit. And your full retirement age benefit is calculated on your highest 35 years. Does that make sense? So once O reach 67 that doesn’t mean the clock stops, and it’s like no, if I’m still working to 75, they’re going to still use those dollar figures to calculate my high 35. So my benefit will continue to increase if that were the case. If I was totally maxed out and I maxed into the system, because you put in $120,000 into the system. Roughly, give or take, then you stop putting into the Social Security system. So if I maxed out and I’ve reached the maximum limit, well then I’m good. But each year that I work, if it’s higher, they’re going to drop the lower years, they’re going to add the higher years, and that’s going to increase my overall benefit. So don’t be afraid to continue to work. Or let’s say if I work and I’m only making $30,000 a year. When I was making $150,000 a year. It’s like, “ooh, are they going to average this now lower year in? Are they going to take it from me?” No, they’re not going to lower your benefit. It’s the highest it’s the highest 35 years.

AC: Yeah. I think something else that people get confused about is full retirement age, which for 2017 is actually 66 years and two months. It’s actually changing as we speak, because they’re trying to get it up to 67 years of age. If you take your benefit before full retirement age, then there could be a reduced benefit. The first few years, starting at 62, you can actually only make $16,920. That’s in 2017. If you make more than that, you start losing some of your benefits. And then during the year that you reach full retirement age, you can make no more than $44,880. But once you hit full retirement age, you can make anything you want and still collect the full benefit.

JA: So that that gets even more complex, and we can kind of recap that, because they don’t actually take it away from you. They’re just recalculating your benefit.

AC: You’re right about that. So they take away the benefit that you got, but it doesn’t mean it will affect your future benefits.

JA: It’s actually going to increase your future benefits.

AC: Since you didn’t get to keep it.

JA: You got it. Well no, it’s more complicated than that. But I’ll explain it when we get back from the break.

For even more useful information about Social Security, as well as retirement planning, investing, tax planning, small business strategies and much more, visit the Learning Center at YourMoneyYourWealth.com. We’ve got a Retirement Readiness guide, an estate plan organizer, white papers, articles, webinars and hundreds of educational video clips on just about every personal finance topic that affects you. It’s all available for free, on demand in the Learning Center at YourMoneyYourWealth.com. If you need more help, you can always email us at info@purefinancial.com, or pick up the phone and call us at 888-994-6257. That’s 888-994-6257.

53:12 – Email Question: Claiming Social Security continued

JA: We’re answering some email questions, here Barry from Nor Cal had a few questions for us in regards to his Social Security benefit. And Al has kind of gotten into the weeds here, in regards to the earnings phase out. And why that came into effect is that, if you take your benefits at age 62, so prior to your full retirement age, and if you’re still working full time, you’re not necessarily going to receive a benefit. If you make more than $17,000 roughly, and then once you reach your full retirement age – so assume my full retirement age is 67, my birthday is in June, so from January to June, that would be my full retirement age, June 26 or whatever year. So that six month time period, then I can make up to $45,000 give or take. So what Al is saying is that, if I’m working, collecting my benefit, and I take it early, it’s like well, once you make more than $16,920, every 2 dollars that you earn, they take a dollar back. And they just assume that you never claimed it.

AC: Right. So in other words, you’ll still get that benefit later.

JA: Right. Because if I take it at 62, remember, you get a 25% permanent haircut. So I take it at 62. I’m still working full time. I make $100,000 a year. So I’m way over the $16,920. So I’m going to blow out and phase my Social Security out, because every 2 dollars that I make, they take a buck back. So that first year, I get my benefit. But then the following years, I’m not going to receive a benefit. But then once I reach my full retirement age, I will receive my full retirement benefit. They’re not going to give me that 25% permanent haircut. But, however, that first year when I do reach my full retirement age, they are not going to pay me my benefit until I pay them back what I received in that first year, because I shouldn’t I got it in the first place. Because the Social Security Administration doesn’t know how much you’re making until you file your tax return at year end. And then they’ll say, “well, what the hell are you doing, Clopine? Why did you claim this benefit when you’re making $100,000?” So then they’ll take it back, but it’s not like, “oh, they’re stealing from me!” How many times I hear that?

AC: Well, they don’t make you write a check. You just get reduced benefits until it’s made up. Is that a fair way to say it?

JA: Yes. This is the last question that we have from Barry. He goes, “My wife is five years younger than I, and will eventually be getting a spousal benefit at her full retirement age. Will she be getting 50% of my current benefit at the time she turned 66 and 8 months, the benefit when I started Social Security, or from my FRA at 66?”
AC: So she’s going to take it at full retirement age, which we’ll presume is 67 – or 66 and 8 months.

JA: So when she turns 66 and 8 months, and she claims her spousal benefit, she will get 50% of your full retirement age benefit. What ever the full retirement age benefit is calculated.

AC: Even if you took it early.

JA: If he takes it at 62, it doesn’t matter for the spousal. As long as she waits until her full retirement age.

AC: Right. If she could take it early, and then it would be reduced.

JA: If she took it at 62, which she could, but she’s not going to receive 50% of his benefit. She would receive 33% of the benefit. She would get a haircut on the 50%.

AC: Yeah. So I guess to use numbers, if we’re saying Barry’s benefit was $2,000 at full retirement age. If his wife takes the spousal at her full retirement age, then it would be a thousand bucks. Now it would be higher, because of the cost of living.

JA: Right. So he’s looking at the statements now man, he must be getting it down to the penny. So he’s like, “OK, well if I get this 8% delayed” – So here’s another thing, on the flipside of that, let’s say Barry waits until he’s 70. The wife doesn’t take the benefit. So now his benefit is $3,200. So does she get 50% of the $3,200? No. She only gets 50% of your full retirement age benefit, whatever that benefit is calculated at, at that time.

AC: Got it. So now let’s think about this. So she’s thinking, “I’m going to wait till 70 to get a higher benefit.” And so there’s really no higher benefit.

JA: There’s no reason for her to wait to take it.

AC: So she basically lost four years, or three and a half years, of payments. And those are lost forever.

JA: The 8% delayed retirement credit is only on your own benefit. It’s not on the spousal benefit. So if I’m claiming a spousal benefit, because why you would claim a spousal benefit to begin with is that you’re claiming the spousal, because half of your spouse’s benefit is larger than yours. So that’s why people take the spousal benefit. So you’re just maxing out as much money as you can. And it really doesn’t work that way either. What they do is, they give you your benefit, whatever your benefit is, and then they shore you up. They make up the difference with the spousal benefit is how it works.

AC: That’s not complicated enough. Well I do have a real life example of a client of ours in the Los Angeles area, and they were both 68 years of age. And the spouse was going to take the spousal, and was basically waiting to 70, assuming that was the highest benefit. We said, “no you should take it right now, it doesn’t it doesn’t matter.”

JA: Right. The really creative claiming strategies went away a couple of years ago. And now it’s something that’s called “deemed” where you can’t say, “well let me claim this benefit, and then I’m going to switch over to mine.” Some of those those claiming strategies are gone.

AC: Yeah you can’t do that anymore. So now to claim the spousal, your spouse has to be claiming currently.

JA: Yes. And for me to claim a spousal benefit, my spouse needs to be taking their own benefit.

AC: Right. And that didn’t used to be the case a couple of years ago.

JA: They had to file for their benefits and suspend them. They didn’t actually have to take the benefit.

AC: But the example here is, we had her go ahead and file for the spousal benefit, and not only did they start paying it, and I don’t know how they calculated this, but they gave her about six months in arrears.

JA: Yeah they only make up six months though. So if you blew up to three years, you’re only going to get paid 6 months.

AC: So she lost a year and a half, that’s gone forever, but she at least made the last 6 months.

JA: This stuff is complicated, if you take a look at someone facing retirement today, and then it’s like, “when should I take my Social Security benefit? I’m married. Should I take mine right away? What’s going to happen to the system? Is the system going to be solvent?” So you got the whole political side of that thing. Or just claiming strategies of how does the spousal benefit work? How does the survivor benefit work? How is my benefit going to be taxed? Should I take my benefit to let my portfolio grow, or should I pull from my portfolio to get the 8% delayed retirement credit, so I can get a guaranteed income stream from the government? But now is it going to be means tested later? There’s so many different obstacles that you have to take a look at, to really have a true retirement plan. And I think Barry’s right on. He’s looking at every cent, every penny, and I think that’s what most people should be doing. And then asking good questions to figure out, “OK am I on the right track here? Does this make sense? Or how does the rules actually work? And what is going to make the most sense for me?” Because what makes sense for Barry is probably the opposite for someone else. So listening to podcasts and radio shows and TV shows, I think sometimes we do a disservice, to be honest with you, because they might only hear three minutes of what we’re saying, and they’re like, “oh yes that’s exactly what I want to do.” So I don’t want that to happen to you.

That’s it for us. For Big Al Clopine, I’m Joe Anderson, show’s called Your Money, Your Wealth. We’ll see you next week.

_______

So, to recap today’s show: RMDs, Medicare premiums and just plain time may affect your retirement in unexpected ways. Make sure you have a plan for retirement before you jump in. The Tax Cuts and Jobs Act is changing our taxes in a big way, from brackets and deductions to alt-min and small business rules. Get your tax house in order – call 888-994-6257 to schedule a tax reduction analysis now. And another Christmas has passed, hopefully without any cussing in church or stealing the scene – the nativity scene, that is. All of us here at Your Money, Your Wealth wish you a very happy, healthy and prosperous 2018.

Subscribe to the podcast at YourMoneyYourWealth.com, through your favorite podcatcher or on iTunes, where you can also check out our ratings and reviews. And remember, if you have a burning money question for Joe and Big Al to answer on Your Money, Your Wealth, just email info@purefinancial.com, or call 888-994-6257! Listen next week for more Your Money, Your Wealth, presented by Pure Financial Advisors. For your free financial assessment, visit PureFinancial.com

Pure Financial Advisors is a registered investment advisor. This show does not intend to provide personalized investment advice through this broadcast and does not represent that the securities or services discussed are suitable for any investor. Investors are advised not to rely on any information contained in the broadcast in the process of making a full and informed investment decision.

Your Money, Your Wealth Opening song, Motown Gold by Karl James Pestka, is licensed under a Creative Commons Attribution 3.0 Unported License.