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Joe Anderson
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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
August 4, 2020

With some of the provisions in the CARES Act stimulus package expiring, Joe and Big Al provide an overview of the two new stimulus bills – the HEALS Act and the HEROES Act – now being negotiated in Congress. Plus, estate planning considerations when it comes to required minimum distributions from IRAs for designated beneficiaries vs. non-designated beneficiaries. The fellas also address listener comments and questions about the 403(b) escape hatch, getting a higher Social Security benefit, records of estimated tax payments, and what counts as assets on the federal student aid application form. Plus, where in the world should you bug out to when your wife throws you out of the house?

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Show Notes

  • (00:54) HEALS and HEROES: New Coronavirus Relief Package and Stimulus Checks in the Works
  • (11:58) Comment: Stimulus Check on a Debit Card – Don’t Throw It Away!
  • (14:08) I’m 65 Now and Social Security Disability Has Ended. Should I Suspend Until 70 for Higher Benefit?
  • (17:08) The SECURE Act and Stretch IRAs: RMDs for Designated vs. Non-Designated Beneficiaries
  • (36:54) Comment: The 403(b) “Escape Hatch”
  • (30:01) Comment: Estimated Tax Payments History Available at IRS.gov
  • (34:22) Comment: What Counts as Assets on the FAFSA Form
  • (36:14) Is $50K Cash and Gold Enough When My Wife Throws Me Out? Where Should I Go?

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Transcription

HEALS and HEROES: New Coronavirus Relief Package and Stimulus Checks in the Works

Joe: So it’s August 1st if this is aired on Saturday. But then the podcast would be August 2nd.

Al: Correct. Right.

Andi: No. The podcast is August 4th.

Joe: August what?

Al: August 4th, give or take a couple days.

Joe: We’ll just see. Depends on when Andi gets her stuff together.

Andi: The podcast comes out on Tuesdays. Come on now.

Joe: Wouldn’t that be the-? OK, the 2nd is-

Andi/Al/Joe: Sunday.

Al: Like the 4th. So pull out a calendar. The numbers usually go-

Joe: It’s been a long day, Alan.

Al: -1, 2, 3, 4.

Joe: It’s been a really long day. I’m guessing you think something will be passed by the time this comes out. Because we’re going to talk a little bit about the new stimulus act that is being proposed.

Al: It could be. So by the time you hear this it might be outdated.

Joe: Yes. But that’s all right.

Al: Anyway we’re giving you the best information we have as of this exact moment.

Joe: Correct. So some questions that are coming in because the main component of the CARES Act- it was a relief act. It was signed back in March. And so if you look at it there was a stimulus or a rebate for individuals depending on how much money that they made. There was unemployment benefits. There was a kicker of unemployment benefits. So they had some changes with unemployment benefits saying that self-employed people could collect and then there would be an additional $600. There was PPP loans for small businesses; there was tax credits for small businesses. There were some enhancements I guess to overall retirement plans by pushing out the required distributions and then the coronavirus related distributions.

Al: That’s right.

Joe: And so fast forward now we’re July 28 and it’s- we need more.

Al: And the problem is the unemployment benefits just stopped. I mean they just ceased.

Joe: August 1st they stop.

Al: Actually depending on your state, they actually may have already stopped this week that we’re in right now.

Joe: OK. So that hurts. So they had to push something out because-

Al: So like in California for example, the maximum benefit’s about $400 a week and with the federal benefit of another $600 on top of that. That’s like $1000 a week. But that essentially stops at the end of July.

Joe: You annualize that, that’s like $50,000 some odd a year.

Al: Correct. That’s right.

Joe: So there was two things that I guess organizations or small businesses could do; or any size organization. They could lay their employees off. Because if they lay them off, the unemployment benefits aren’t bad. You’re still gonna make $50,000 roughly annualized, even though it was for a four month time period.

Al: And in some cases people ended up making more not working.

Joe: More. Yes.

Al: Now they’re having trouble getting them to come back.

Joe: Exactly. Or they could say you know what- and then some employers said we don’t want to lay off any employees. We’ll just take a PPP loan. So the paycheck protection program where they were able to get a couple of times of their annual payroll cost as a loan that would be forgivable. So they could get cash from the government and then they could control those dollars and just distribute them.

Al: Yes. So you’re right.

Joe: But the problem with that is that there’s a time frame there too, you can’t lay people off or you got to keep them employed for a certain time period. But then as soon as that time period meets where that loan becomes forgivable, what do you think potentially they’re going to do?

Al/Joe: They’re going to lay them off.

Al: Yes. So we’re kind of back in the same spot. So that’s why we need more stimulus. And the House put together the HEROS Act I think last week. And the HEELS Act came out on Monday July 22nd by the Senate Republicans. And so they’re not exactly the same as you can imagine.

Joe: Well one’s $3,000,000,000 and ones $1,000,000,000.

Al: Correct. You can guess which one is which. The House’s $3,000,000,000; the Senate’s $1,000,000,000. But anyway now at this point as we speak, they’re trying to negotiate and come up with a compromise.

Joe: So we can kind of go through a couple of this- I think what’s on people’s mind- do you think there’ll be another stimulus paycheck, Al?

Al: Yeah. And we’re kind of going off an article in Forbes that was just written – Will There Be a Second Stimulus Payment? And the author believes that yes, there will most certainly be a second stimulus payment; although the specific details are in flux. And I would agree with that and the reason I agree with that is because both the House Democrats and the Senate Republicans want another stimulus payment. So what happened- will probably happen is probably the same as what it was before; $1200 per person, $2400 for a married couple.

Joe: But this is a tax credit too. You’re getting paid a cash advance of a tax credit based on whatever tax return is on file.

Al: It’s a credit. Correct. And it’s actually going to be kind of a trued up on your 2020 tax return. But it’s based upon the most recently filed return which- and the first one was either 2018 or could have been 2019. Now it should be 2019 although some people may have extended. So I guess it still could be either. Based upon those returns and if your income is more in 2020 you don’t have to pay it back. So that’s what we would expect. Just kind of another more of the same. Although I will say that the HEROS Act in the House they wanted $2000 payment not $1200. But it’s probably going to be like what it was before, I’m guessing.

Joe: There’s some argument based on who qualifies. In the CARES Act, it was $75,000 for single, $150,000, that’s adjusted gross income, for married. The GOP is looking for a little bit lower amount of adjusted gross income.

Al: They’re thinking maybe it should be $40,000 of income instead of $75,000. So we don’t know yet. But I guess that it does seem like there is going to be some kind of stimulus payment for certain people we just don’t know what it is yet.

Joe: Another big question- the $600 per week federal supplement, what do you think’s going to happen there, Big Al?

Al: Well I think there will be a supp- it may not be $600- because here’s what the Republicans-

Joe: – want $200.

Al: Yeah. They want- here was their deal, was that some people were making more than they were and which is true. I know of people that are making more being unemployed than actually working. So what the Republicans are thinking of doing is starting with $200 a month and then adjusting it upward to get to maybe no more than 75% of your pay but a max of $400 or $500 per week, instead of the $600 for everybody.

Joe: So it’ll be a little bit of a kicker but we’ll see kind of how the chips fall there.

Al: Yeah exactly.

Joe: Then the independent contractors, freelancers, the self-employed; so that’s on the table again, are they going to continue to give those benefits?

Al: It is. And according to the author in Forbes it’s still pretty uncertain. So wait and see on that one.

Joe: The PPP program, that’s already been extended I think August-

Al: August 8th.

Joe: August 8th. So I guess they’ll want to look at extending that maybe a little bit more.

Al: Yeah it’s possible.

Joe: These bars, restaurants, movie theaters-

Al: They got no income-

Joe: -any type of theater. Andi, you like going to live music. When’s the last time you’ve done that? Some of these small little cool eclectic shops and- all of these people are hurting. So I would imagine there’ll be another PPP program. But maybe they’ve had time to revamp it a little bit. Because the first go around-

Al: – was a little bit messed up.

Joe: -a little flawed. Los Angeles Lakers qualifying and getting a loan.

Al: Yeah right.

Andi: I’ll say I’m definitely feeling for my live musician friends who are trying to do like live streams on Facebook and stuff like that for tips and they’re just not making any money on that. It’s just not enough.

Joe: A good buddy of mine plays all over San Diego and he’s played from my mom’s birthday party.

Andi: Oh, I remember him.

Joe: You’ve seen him?

Andi: Yeah. He can play anything.

Joe: Yeah. He’s pretty good. He’s like I don’t know why I’m doing this but I’m doing another stupid Facebook. And I feel bad. He’s got probably 20 people on it but it’s a Sunday afternoon. You pop him up $50 tip. It’s like he’s got a little kid. So anyway. So payroll tax cut. I don’t think that’s in the cards.

Al: According to President Trump he’s saying no. But Mnuchen says that maybe later. So we’ll see.

Joe: In the CARES Act there was student loan forgiveness. They pushed out student loans; no payments, no interest. Stay tuned. We’ll see what they do there. Will there be a return to work bonus for employees?

Al: This is a new proposal by Senator Rob Portman of Ohio. He basically- and this was the problem, people didn’t want to return to work because they were making more on unemployment.

Joe: Exactly.

Al: So they have to give them a bonus to come back to their job. Anyway, stimulus for cities and states?

Joe: I’m pretty good. I’m gonna stay home, collect unemployment. We’ll give you a bonus.

Al: Well I’d rather take the unemployment.

Joe: But I guess what- how do these employers hire other people that want to come to work? Then they’ll get sued.

Al: Yeah right. Of course. Exactly. Question about whether there’ll be aid for states and cities under the new stimulus package. And there probably will be something. The Democrats and Republicans are not agreeing on what it will be. And this is principally just because the income is down people can’t- people not buying, the sales tax income is down. A lot of people are not paying their property taxes right now so it’s-the governments, local governments are hurting.

Joe: And then, what do you think-? last one I want to talk about is with renters. What do you see there?

Al: That’s a good question because the CARES Act provided for a moratorium on evictions for renters in federally backed mortgages but that expired July 25th. So it’s already expired. I think that’ll probably be extended being that Covid cases and hospitalizations and deaths are spiking again in the country as a whole. So yeah I- probably. Which puts a lot of hardship on landlords.

Joe: Exactly. People that- investors.

Al: Landlords still have to pay the mortgages. A lot of our listeners are real estate investors where- so their cash flow or their income could potentially go down because of this.

Joe: Well, we’ll stay tuned folks. As the new bill comes out, Al will spend the weekend reading it and then he’ll type up some Cliff notes for me to talk very intelligently.

Comment: Stimulus Check on a Debit Card – Don’t Throw It Away!

Joe: Joan writes in. She goes, “The stimulus check arrived at my house on a debit card. It looked like a scam. Like many others, I chopped it up. It was from Money Network or some fake sounding company. My understanding is that checks and auto deposits are no longer the method for distribution of stimulus money. Simply call the number on the back and they will send you another. Still listening. Joan.” So I wasn’t crazy. They are issuing debit cards for the stimulus checks?

Andi: Apparently so.

Joe: Is that what she’s saying?

Andi: Yeah. And she said it looks like a scam.

Joe: So she cut it up. And then now she’s gotta call them back to get another card. And she’s gonna cut that one up too.

Andi: Which that in itself sounds like a scam.

Joe: And then she’s gonna call and she’s like why do they keep sending me these cards? It’s a scam.

Al: So I never heard- Where did you hear that? I never heard that.

Joe: I heard it on some podcast. It’s hearsay.

Al: I’m not sure that’s true.

Joe: I don’t know. Google it. We got 36 seconds.

Al: My understanding is it’s either an auto deposit, if that’s how you have it in your tax return, or it’s a check. Those are the only two ways to do it.

Joe: What to know about stimulus checks via debit cards?

Andi: Don’t accidentally toss your economic impact payment when it comes on a prepaid Visa debit card. This is from US news.

Joe: There you go.

Al: Well I-

Andi: USNews.com.

Al: See that’s why you don’t really take what we say. Because I didn’t know that.

Joe: I heard something-

Andi: Nearly 4,000,000 Americans were sent their check on a debit card instead of a paper check. According to the IRS.

Al: Okay. How about that?

Joe: There you go. All right folks. That’s all we got for you today. Send us your questions. Email bag is getting light because our website blew up, so find a way to get it to us at YourMoneyYourWealth.com. Thanks so much and we’ll see you next week.

I’m 65 Now and Social Security Disability Has Ended. Should I Suspend Until 70 for Higher Benefit?

Joe: We got Linda from Del Mar, California writes in. She became disabled at 39. “The disability benefit through my employer required me to claim my Social Security at that time. I’m now 65 and my disability has ended. I am left with a smaller Social Security amount since I had to claim early. Should I suspend my Social Security till age 70 to get a higher amount?”

Al: So I know the answer to that.

Joe: OK good.

Al: From Mary Beth Franklin. And the answer is no. And I’ll tell you why.

Joe: Because she’s disabled.

Al: Because the new- according to Mary Beth Franklin, in December of 2014, remember they changed the law- Social Security Administration? The Social Security Administration clarified its claiming rules so that a request to withdraw funds to prevent automatic conversion to retirement benefits would be treated as a request to withdraw all benefits including disability benefits. So let me go back and set the stage. This was a question on somebody that was receiving disability payments and which automatically convert to Social Security payments-

Joe: – retirement benefits.

Al: Correct. And they wanted to suspend their Social Security to get a higher benefit amount.

Joe: So they were disabled, getting disability benefits. They reach full retirement age. And then they automatically revert- or convert-

Al/Joe: – to Social Security benefits.

Al: That’s right. That’s exactly right. And you used to be able to do that.

Joe: Suspend them and say I don’t want to take it at full retirement. I’m going to wait till 70 to get my 8% delayed retirement credit.

Al: Now the current rule is, according to Mary Beth Franklin, if you do that, this would require an individual to repay all of the disability payments they had received over the years; an expensive and unattractive option. So that would be age 39 through 65. You’d have to pay all of that back.

Joe: 26 years of the benefit.

Al: It’s not practical. So don’t do it, Linda. Just stick with the low- I understand it’s a lower payment than you would like, but it is what it is.

Joe: The lower payments didn’t- the disability payment that she received just converted to retirement benefits.

Al: That stays the same.

Joe:  But when she looked at her Social Security statement that comes in the mail or online, she goes my benefit at 65 should have been $2300 a month. I’m getting $1800.

Al: That’s right. Exactly. And she wants to maybe suspend it so she can get that higher benefit. And the answer is no.

Joe: Social Security. Well, I wonder why they did that?

Al: I don’t know.

Joe: That doesn’t make a lot of sense.

Al: But I will tell you one thing, Mary Beth Franklin knows her stuff.

Joe: Yes. She’s been on the show multiple times.

Al: Yes she has. And so if that’s what she says, that’s true.

Joe: Very friendly lady.

Al: Yep. Super.

Joe: Joy to talk to.

The SECURE Act and Stretch IRAs: RMDs for Designated vs. Non-Designated Beneficiaries

Joe: I do these webinars, Alan. And I was going back and forth with this gentleman that had a question. Because with these educational webinars that we do, we’re doing a couple of them a week, actually like 4 or 5 a week. And a lot of it’s on the CARES Act and the SECURE Act and taxes in general. And I think we talked about this last week or maybe it was a few weeks ago, but I want to bring it up again. Because it’s extremely confusing when people name a trust the beneficiary of their retirement account. The SECURE Act changed the rules in regards to Stretch IRA for most. If you’re an eligible designated beneficiary, so that’s a spouse or disabled child or someone that’s chronically ill and or someone is like 10 years-?

Al: 10 years- within 10 years of the age of the person that passed away, you can do a still a stretch.

Joe: And what a Stretch IRA is, is that when you’re a non-spouse beneficiary or an eligible designated beneficiary you can stretch out the tax liability over your life expectancy. So let’s say you inherit- you’re 24 years old and you inherit a 30-year old’s IRA, you can still stretch out the tax on that IRA over your life, even though the IRA is probably gonna be pretty small.

Al: So that means you have to take a required minimum distribution each year but it’s a small amount. And so it can go over the course of your life. It won’t push you potentially into higher tax brackets.

Joe: The SECURE Act changed that. And so what the SECURE Act said is that we’re going to get rid of the Stretch IRA. You need to dump all the money out of the retirement accounts within 10 years. And it could be 5 years really depending on if the beneficiary on the retirement account is designated or a non-designated beneficiary. So it gets even- I mean just talking about it- just hearing me talk makes it sound confusing as hell.

Al: It is. And I’ve already tuned out.

Joe: But it’s very important for people to realize this. Because I think a lot of people with a lot of money in IRAs listen to the show. And we talk a lot about Roth IRAs and we talk about distributions from retirement accounts, how to create income tax-efficiently, savings programs and everything else. But I think a lot of people will probably end up losing a lot of their wealth to unnecessary taxes because of how they named their beneficiary. Case in point was this gentleman that went to one of my classes and his question was, he goes “You said something that scared me, is that 10 years or 5 years is that the IRAs have to be fully depleted. Can you tell me more?” and I said well yes if you have a designated beneficiary that’s not eligible, it’s distributed out in 10 years. And if it’s a non-designated beneficiary, all of the money has to go out within 5 years. So then he’s like well “I named trusts as my beneficiaries so I should be good, right?” And I was like ‘no, it’s probably even going to be worse. Because a trust, in theory, is really a non-designated beneficiary because it’s an entity it’s not a human being. A trust doesn’t have life expectancy. In the old days for them to stretch out the taxes over the beneficiary of the trust’s life expectancy. So long story short, is that you have to look at, what is the goal of naming the trust your beneficiary of your retirement account? And then you have to understand the rules within the retirement- or within the trust, is that is it a conduit trust or is it a discretionary trust? And most people that name a trust the beneficiary would name a discretionary. Like Alan, I’m going to give you my IRA but I don’t want you to touch the money until you’re 70. You know the trustee or the person that’s deceased- the reason why you would do that is to control the money.

Al: So I wouldn’t spend it.

Joe: To control your spending habits.

Al: Which you need to do apparently.

Joe: Exactly. And so like with kids, I only want the child to get so much at age 40, then 45 and then 50. We’ve seen all sorts of different languages in these trusts. So that’s fine. But if it’s in a discretionary trust and it stays in trust, those distributions are going to be taxed at trust tax rates and it’s at 37% anything over like $13,000 of income. And people that name trusts the beneficiary of a retirement account usually have a lot of money in a retirement account. It’s not like $50,000. Why would you spend the money to do all this? So you want to make sure that you double-check your beneficiary designations. You want to double check to see if a trust truly makes sense. What are the goals? Do you want to control the money from the grave? Are you trying to protect the money from creditors? Or maybe ex-spouses? Or maybe you don’t like your kids’ spouse and you’re like I want to make sure it’s separate property? Are you-? You know- so there are all sorts of different goals that people have. But I think going through this with this gentleman it’s like well no my grandkids are named in this trust and it’s like but they’re not going to be able to stretch it; especially if it’s a discretionary trust that you’re gonna blow yourself up in taxes. A conduit trust is something completely different where it’s just basically I’m taking the RMD and I’m taking it out of the trust and it’s going to get taxed at the kid’s rate or the beneficiaries’ rate. But the problem with that is the RMD now is in 10 years. So that trust is only going to last for 10 years and then it’s everything is distributed. So, I don’t know. I just went back and forth with this guy for a while just trying to help him out. But then I thought maybe more and more people probably have a- don’t you have an IRA trust?

Al: I do. I’m actually going to get rid of it.

Joe: Have you ever changed it yet?

Al: Not yet. I need to. But I guess to maybe put an example of this because it’s kind of hard to understand. So let’s say I’ve got $1,000,000 IRA and let’s just say I have one child. I have 2. But let’s say I’ve one. And under the current rules, my kid has to take the money out of the IRA within a 10 year period. Now it could be $100,000 a year. It could be nothing until year 10 and it could be $1,000,000. In year 10. That’s the choice. But if I named my kid as the beneficiary they would have the ability to take- they have to take at least $100,000- well they don’t- they can wait till the end. But if they want to stay in lower brackets maybe they want to bleed it out as slow as possible. So the prudent thing would be to take $100,000 out each year whatever. But my kid would have the complete ability to spend not only that $100,000 but could spend the whole $1,000,000 if they wanted to pull it all out. And if I was concerned that my kid’s not that good with money. So I want to put some handcuffs on that. So that’s why I would set up a trust as the beneficiary. So the trust doesn’t change the RMD requirement. In other words the trust- the same same. The trust has to take all the money out within 10 years. But let’s just say it’s taken out in 10 years. It could still be in the trust. So that my kid wouldn’t necessarily have access to it but that whole $1,000,000 coming out is going to be taxed at the trust tax rate, which is the maximum rate of 37%, at around $13,000. So that’s why you’re saying it’s very expensive. You’d spend a lot of money in taxes to do that.

Joe: Right. Because if it’s distributed out and taxed at the kid’s rate, they need $670,000 of income to get to the 37% rate which is $13,000. You hit that top rate. It’s with very little income.

Al: So maybe you protect your kid from spending, but half your portfolio goes away because of taxes when you add state tax on top of it.

Joe: Right right. So then it’s like well what the hell do you do? I’m going to keep it in trust and give it all the IRS. Or you know what, who cares? I’m going to give it to the kids and have them buy a Porsche.

Al: But that’s the dilemma. And with the Stretch IRA, it was much easier because then you could take the money out over a lifetime. Now it has to come out in 10 years. And if the kid pays the tax, theoretically it’ll be a lower tax rate unless they’re already in the maximum rate. And in that case, they probably wouldn’t spend it because they probably have more money than they need. But someone that doesn’t have a lot of money, if they got the money and it was taxed at their rate it would be a lot lower tax than if it’s kept in the trust; although if it’s kept in the trust the beneficiary couldn’t spend it. So that’s the quandary. Like which is more important.

Comment: The 403(b) “Escape Hatch”

Joe: Hugh from Maryland. He wrote in a couple weeks ago. He just kind of gave us a comment. He goes, “From show 278 while Joe was responding to David from Allentown-” Allentown. Remember David from Allentown? That’s your town.

Al: I do. That is my town.

Joe: “Joe stated and asked he qualifies for a CRD so he should take money out of his 403(b), the 403(b) escape hatch. Who is he listening to who’s coming up with this stupid term?”

Andi: He’s quoting you. That’s what you said. Yes.

Joe: I said it’s a stupid term?

Andi: Yep.

Joe: It’s absolutely- and I agree with myself 100%. Escape hatch.

Al: Okay.

Joe: So David from Allentown was cheating on us maybe.

Al: They listened to another show.

Joe: What’s this? What are they called?

Andi: What are what called?

Joe: Teach- I don’t know. I can’t read a HTTP website address.

Andi: No, he says- Hugh says “maybe David is listening to Dan Otter and Scott Dauenhauer. And he sends a link to their podcast.

Joe: But what’s it called?

Al/Andi/Joe: Teach and Retire Rich.

Al: Yep.

Joe: That’s what I was asking.

Andi: Got it. Okay. Well your sentence wasn’t fully formed so it was hard to tell.

Joe: Got it. I understand. That happens often.

Al: I followed you.

Joe: See, Big Al’s- we’re one. We’re Siamese twins.

Andi: Roth Brothers.

Al: Right. Annoying sometimes.

Joe: So you just did a Google search. I don’t know. So who are these guys? Do we have any intel on-?

Andi: No idea.

Joe: Are they the advisors or are they just bloggers? The FIRE people.

Al: Apparently that’s who came up with this escape hatch verbiage. So anyway.

Joe: Oh. Got it.

Al: Because you were wondering who it was.

Joe: Former Teach- Teach for America and charter school teacher Eugene- I don’t know. What the hell? Who are these people?

Andi: I’m not sure.

Joe: Everyone has a blog, podcast.

Al: Even us.

Joe: Even us. But I bet they don’t get like 5 listeners per week. We do.

Al: They get 100s, maybe 1000s.

Joe: Well we were ranked though something- weren’t we Andi? What were we ranked?

Andi: We were like number 96 on the investing charts.

Joe: 96 Al.

Al: Movin’ up.

Joe: Eat that-

Al: Broke the top 100.

Joe: – Otter. What’s his name? Jack Otter?

Al: Dan.

Andi: Dan Otter.

Joe: Otter. We know Dan Otter. Or was that Jack Otter?

Al: I don’t know.

Joe: Oh. Whatever. Jack Otter- look him up and then we’ll get back from the break. Jack Otter was on our show; not Dan Otter.

Al: Yeah, not Dan.

Joe: Dan Otter. I think I know that guy too. I didn’t care for him.

Andi: You’re making that up.

Joe: But that’s neither here nor there. Maybe I don’t know him. I don’t know.

Al: Maybe not. It’s just-

Joe: I know Jack Otter. Jack was great. Dan Otter. Maybe it was Dan- something else. Anyway-

Comment: Estimated Tax Payments History Available at IRS.gov

Joe: David writes in from New York City. He goes “Hey, no question here, just FYI.” That’s always good to know.

Al: Right.

Joe: They’re either going to blow us up and say- or it could be helpful.

Al: Could be.

Joe: “On a recent podcast, 279 I think, I recall there was a question about an online record of estimated tax payments to the IRS.” Yeah, I was asking you that personally, Alan.

Al: Yes. Didn’t I answer it? Or- ? Apparently not.

Joe: “There is a way to create an account that both allows estimated payments to be made and records the history of those payments. I set up my account a year ago and I just used it to make a Q2 estimated payment. The link has the Create Account button. So that’s IRS.gov/payments to view your tax account and New York State as something similar. Hope that helps listeners.” Oh cool.

Al: I agree with that.

Joe: I make estimated payments sometimes.

Al: When you feel like it?

Joe: And then it’s like dammit, I forgot how much I- right? And I just did my taxes and it’s like oh God, where do I find out how much estimated taxes that I actually provided?

Al: The IRS is pretty good about that. So you can just set up an account. And you give them your Social Security number and a few things like that and a password. You set up your account you can make payments online for estimated payments, for extensions, for whatever. OK. And you can also see your past history. It’s actually a really good way to know what you paid. And most states have something like that. We’re in California. California has something similar; appears that New York State does as well. So I like that service and in fact, talking about taxes as we record this, it’s July 15th. My dad is filing his taxes today. Actually I’m electronically filing for him. But he will not do anything electronically because he doesn’t really trust it. So he’s going over to the post office today as we speak to make sure his state payment gets in, his federal payment gets in. And his 2 estimates; one for state, one for federal; 4 envelopes get postmarked today. So bless his heart. I mean some people need to do it that way.

Joe: That’s right man.

Al: The rest of us, myself included, like to do it online; very clean.

Joe: Very easy. When’s the last time you mailed a letter of any kind?

Al: I mailed one today. Because I had a client that has a charitable remainder trust and you can only extend those via mail. But besides that, it’s been a long time since I mailed anything. Everything gets paid online.

Andi: I have a bill that I have to pay every month by actually writing a check and putting it in the mail because they want $20 to pay the bill online. And it’s just not worth it. That’s insane.

Joe: How much is the bill?

Andi: Well it’s like $500. But they want $20 to accept a payment online and I said no, I’ll send you a check.

Al: That’s weird because it’s- online it’s so much easier for them too; unless it’s a credit card than they get charged for that, I would understand that.

Andi: Nope.

Joe: I would still pay the $20.

Andi: Of course you would.

Al: So you don’t have to get an envelope and write the check and then put it in there with the invoice.

Joe: Sounds like a hassle.

Al: It is a hassle. And that’s how-

Andi: -intentionally.

Al: – in my early days, that’s your only choice. Now that it’s online, it’s like this is awesome. Most of my bills are paid automatically. Just autopay. It’s like super easy.

Joe: I would say most of mine too except for miscellaneous stuff I guess.

Al: I still have to write a check to the gardener.

Joe: Me too.

Al: Because I tried to pay him online and he says I didn’t pay him and I did. And I show him on the bank statement, but ‘I never got it’. It’s like, we’re going back to the check for you.

Comment: What Counts as Assets on the FAFSA Form

Joe: We got DeAnn. She goes “Hi. Really enjoy your podcast. Probably someone else wrote in about this, but I’m wondering if your info on the FAFSA form was wrong.” DeAnn, the answer is it’s a high probability.

Al: We do our best. Let’s put it that way.

Joe: “I don’t believe parent or child retirement accounts count as assets on the FAFSA form. I know when I fill out FAFSA it mentions to not include those accounts. I believe the grandfather would be fine helping the grandchildren with a Roth IRA. Investments don’t include the home in which your parents live, cash savings and checking accounts, ABLE accounts or value of life insurance and retirement plan, 401(k)s, pensions,  and so on. This comes from the Student Aid.gov. Same for the student.” Did we say something like if there’s a retirement account it would be count for FAFSA forms?

Al: I don’t remember the question exactly. But I thought the kid’s accounts did count for FAFSA. But it’s been a decade since I did that almost.

Joe: I don’t think retirement accounts would count for-

Al: Probably not retirement accounts.

Joe: But like UTMA accounts?

Al: I would think those would.

Joe: UGMA accounts? But I agree, DeAnn. Sometimes we just- we don’t even pay attention to what the hell we’re saying.

Al: We’re just trying to get the podcast over with.

Joe: Just trying to get this thing over with. We just throw out whatever we want. Okay fair enough.

Al: Maybe we stand corrected.

Joe: We’re not FAFSA experts.

Al: I think- so Ryan is 27, so I was- I did a FAFSA form maybe 9 years ago.

Joe: You don’t remember it.

Al: Not really.

Joe: Okay.

Is $50K Cash and Gold Enough When My Wife Throws Me Out? Where Should I Go?

Joe: Got Tom “on the lam” he writes in Al. You know who Tom “on the lam” is?

Al: Tom “on the lam”. I can’t wait. We’ll see.

Joe: He goes “Dear Big Al, Andi, and Joe.” I like that- I don’t really care for last billing here. And I think most people would agree that I deserve front billing.

Al: You think?

Joe: I believe.

Al: I think occasionally I could get top billing.

Joe: Well if he’s got tax questions. “As always thanks for a great show. Like the rest of the country I’ve been hunkered down at home with my wife. I thought this would be a good trial run for retirement. Turns out that I’m not easy to live with when I’m always under foot. “That’s probably a saying that some old timers say.

Al: Yeah.

Joe/Al: “Imagine that.”

Joe: “It’s only a matter of time until my better half throws me out. No doubt there will be champagne and confetti when I’m gone.” Poor Tom. I think that’s happened to a lot of people in this quarantine.

Al: I think so too.

Joe: Andi, how’s your relationship? Stronger than ever?

Andi: Yep. Doing just fine.

Al: Okay. Mine too.

Joe: Oh I know Big Al, you’re like a cartoon.

Andi: I do know people who are really struggling.

Joe: Like Ned Flanders. Just a super happy day. “I have $50,000 in cash and some gold coins in my bolt bag-”

Al: When he needs to bolt he’s all ready.

Joe: He’s getting the hell out.

Al: Put a couple of shirts and shorts and flip flops-

Joe: There ya go. “My question is, is this enough? Can you suggest a good place to go? I was thinking Costa Rica but I’m open to suggestions. In the words of Spock, live long and prosper.”

Al: He needs to live somewhere cheap right?

Joe: I don’t know. I’ve never been to Costa Rica. I’d like to go to Costa Rica.

Al: You know, of all the places I’ve traveled, I have not been there either and it’s definitely on my list. But if I were Tom and I liked that part of the world, I would look at Panama. Supposedly it’s cheaper than Costa Rica and somewhat similar in terms of terrain.

Joe: Whoa. And a lot more violence.

Al: Could be.  Well, you wouldn’t want to go to Honduras maybe or some of those but, anyway I-

Joe: Have you ever been to Panama?

Al: No. I’ve just heard that. I’ve heard people- remember there- I don’t know- well you’re young, but I’d say 20 years ago there was this craze about Costa Rica. All the Americans were going down there and buying land and then it got expensive. And then there was a switch to Panama. Maybe that’s too expensive now but that’s the last I knew.  Actually, Tom what I would do is I would google “cheap places to live as an expat” and see what pops up. That’s what I would do.

Joe: I think I want to go to Costa Rica. I think it would be nice. I think I’d rather go to Costa Rica than Panama.

Al: They’re about the same.

Joe: Is it?

Al: Yeah.

Joe: But you’ve never been to both.

Al: No. Never been to either.

Joe: The authority-

Al: I’m speaking from experience. I do not know what I’m talking about.

Joe: You’ve been to Cuba?

Al: No.

Joe: It’s very similar.

Al: I’ve been to Hawaii and Mexico. Close enough. Somewhere between those two.

Joe: Got it got it. Got it. Got it. Okay. All right. Well yeah. The quarantine. This is something else.

Al: It’s putting stress on some relationships.

Joe: Yes. I know. There’s some people I know that have a little bit more stress.

Al: You good?

Joe: I’m okay.

Al: You’re good. You’re getting to be happy as you get- grow older. Right? Happy-go-lucky?

Joe: I’m super happy. Kinda like pissed off but it’s not like I’m sad. Because I’ve got a lot of energy, I just want to get stuff done right. So people drive me nuts. For the most part, I really enjoy myself. I don’t- it’s kind of getting boring though. I guess-

Al: The stay at home thing?

Joe: The stay at home thing. I don’t watch a lot of TV. Thank God golf is on. Because that’s my saving grace. So I go play early in the morning then I come home and then I’ll watch it. But not being able to go to restaurants-

Al: So we got through three seasons of Designated Survivor. And then we watch this- something called Virgin River; which is like a Hallmark movie. And this is serious. It’s still pretty good. It has a little bit more teeth maybe than a Hallmark, but not much.

Joe: Got it.

Al: It’s about-

Joe: So does someone come in and save the town from the evil?

Al: Kinda, yeah. The city girl goes to the small town, has problems. And the guy who helps her out.

Joe: Who falls in love.

Al: I think I’ve seen that movie is a bunch of times.

Joe: Oh God. I finished Narcos. That was awesome.

Al: I don’t watch stuff like that.

Joe: It’s so good. So good. And then I watched Narcos Mexico which is even better.

Al: Really.

Joe: I thought so.

Al: Yeah. Okay.

Joe: Now I’m kind of searching-

Al: -for the next one. The next Virgin River? Put you to sleep?

Joe: Yes. Virgin River. Well that’s all we got. Great job Andi. Thanks again for keeping us together.

Andi: Thank you.

Joe: Big Al and I’m Joe Anderson. We’ll see you again next week. The show’s called Your Money, Your Wealth®.

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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.