At some point, the topic of taxes in retirement is going to get your attention if it hasn’t already, taxes could be your biggest expense in retirement. Every time you turn around, you’ll be paying taxes on your IRA 401k and other tax deferred accounts, Social Security benefits, investment, income and more. When you add it all up, taxes could be your largest expense in retirement and you could be left with a fraction of your retirement savings. But if you take advantage of some preventative tax planning strategies before you retire, you could save yourself hundreds of 1000s of dollars, the savings could be so significant, you may retire earlier than you thought possible. At Thrive financial services, we will show you the power of these tax planning strategies with our tax analysis. This analysis reveals opportunities that could save you a bundle in taxes with your IRA 401 K, pension, Roth conversion RMDs and more Call to schedule your free tax analysis now at 215-798-9088. That’s 215-798-9088 Nothing in this advertising is intended to give you specific tax or investment advice consult your own tax or financial advisor.

 

 

Welcome to roadmap to retirement, the radio show with David bizarre, Karen bizarre and Brett Elam from Thrive financial services who’ve been featured on Fox, ABC, NBC, the Wall Street Journal and more. Saving for retirement is a great start. But it’s what you do with this money that really matters. What’s your strategy to reduce taxes, generate income in retirement, reduce your risk and get even more money from Social Security. This is where you can count on straightforward and objective advice about how you can make your money go a lot further in retirement roadmap to retirement, the radio show. Now here are your hosts, David Caron and Brett along with Joe Kraus. Welcome

 

Joe Krause 

into this very special edition of roadmap to retirement the radio show along with David bizarre and Brett Elam. I’m Joe Kraus. We begin this weekend with a wish and a thanks to all of the veterans as we broadcast to you. On this Veterans Day, we thank all of our veterans, for the unconditional commitment to all of us. Yeah,

 

David Bezar 

big, big thank you. We got a lot of turmoil going on in the world. So we just want to make sure all of you know former and current folks that are in our armed services, you know, in a good place.

 

Joe Krause 

Yeah, no doubt about that, and always in harm’s way on our behalf. So

 

David Bezar 

no doubt. So, yeah, you know, I’ve opened the show a couple of times over the couple of years, we’ve been doing this where I’ve said, you know, A Tale of Two Cities, it’s the best of times, it’s the worst of times type situation. I think we saw that over the past week worse, 10 days or so, you know, federal, federal Chairman Powell came out, I guess it was not this past Thursday, previous Thursday said, you know, no new increase in interest rates. And the markets went up. And everybody’s like, well, you know, it’s fine. We’re not gonna have a soft landing. And then he came out yesterday, and I guess it was on Thursday came out again and said, not sure we did everything enough to stave off inflation in the market sold off, you know. So, you know, it’s kind of like, depending on what channel you get on at what particular time during the day, the message just is constantly confusing. What also came out this week was the new cola adjusted income thresholds for 2024 on our tax brackets, right. So adjusting those, and today’s show is going to be a lot related. Now we did a show last week that was fully dedicated to taxes. Today, again, we’re going to do the same thing. Because, again, it’s it’s a big part of what we do here at Thrive. It’s not the only thing we do. But we find it’s the one area that retirees and future retirees haven’t really spent enough time getting themselves educated. And making sure an understanding of taxes is going to be one of your biggest expenses that you’re going to deal with in retirement. And not planning could mean you’re going to make mistakes that could cost you 10s of 1000s, if not hundreds of 1000s of dollars. And we want to just make sure that that money ends up in your pocket versus Uncle Sam’s pocket. So what we’re going to talk about today, Joe is the tax spectrum of retirement income sources. So what that means is how the source of your income, like where it’s coming from, is going to dictate the amount of tax that you’re going to ultimately have do. So planning for retirement, you know, it’s actually a journey and one of the least navigated areas. Is that tax implication on that retirement income that gets generated many people often mistakenly believe that their tax obligations will naturally go down. Once they stop working. I think more and more people are coming to conclusion That’s not necessarily the case, right? I mean, the reality can be starkly different. No accounting for taxes might mean taking larger than anticipated withdraws from retirement income retirement sources, just to be able to survive, right. So unplanned things, medical expenses, whatever it may be. So taking those unanticipated retirement withdraws, can push retirees into much higher tax brackets. And then that’s going to initiate this tax dilemma that we see happen to a lot of folks. So, you know, grasping that intricate tax landscape can be important, because retirement income source can significantly influence tax obligations. What we try to help people understand is a comprehensive understanding of this. Overall, this kind of broad tax spectrum really helps empower retirees to make much more informed decisions. Definitely make sure that they optimize their income streams, and help predict their financial well being all throughout their golden years. Here’s

 

Bret Elam 

today’s show, we’re gonna go through a bunch of thought provoking questions as we go through the content. So we went through some great ones last week. First one we’re gonna take you through, I want you to think about this. One is how might your retirement income sources shift your tax bracket? And what implications could that have on your overall financial health? We touched on this a little bit last week, but we’re gonna go a little bit deeper as talking about what percentage of your Social Security benefits is subject to taxation. And more importantly, is how might other income play a role in this calculation? David just spoke about with this with the 2024 tax increases, is that with the evolving landscape of tax laws and always changing laws, are you regularly reassessing the tax implications of your retirement account withdrawals? Next question we’re going to dive into is how might required minimum distributions from your retirement accounts impact your tax bracket, especially if you do not need those funds, which we see a lot of times. And we’re also gonna go through a given potential reduction in Social Security benefits with continued employment, and how this quote unquote, indirect tax may affect your retirement income strategy. So looking forward to taking the audience through that one as well. Yeah, those

 

David Bezar 

are just five questions of 10 that we want to really kind of throw out there. We did that last week. And we got through all 10 questions, which I think was a you know, a feat in itself. But I always want to remind our listening audience that this is great information, it helps with the awareness, it helps with the education. But until you take action, and really find out what’s happening, right, what am I doing? Am I doing everything right? What’s it going to look like when I finally either get retired or hit that required minimum distribution, age, whatever it may be, the easiest way to take action is to call us or actually text to us the word plan to 215999 30 to 72. Again, that’s plan at 215999 30 to 72. What we’ll do is we’ll send you out our tax guide. And then we would really encourage you at that point to schedule and you’ll be able to do that on the text that you get scheduled either that like 15 minute quick little discovery Call, or go for a full blown complimentary consultation lasts about 45 minutes to an hour, get all your questions answered. And we ended up delivering some really good analysis for you that can help you kind of make those right decisions and navigate retirement successfully. Yeah, really

 

Joe Krause 

is comprehensive. One other thing I’ll point out to the listening audience quickly as we get into the breaks today, there is a list of for upcoming workshops that will be this upcoming week. Try and get to one of those, that’s another option for you to get educated 100%.

 

David Bezar 

So let me cover a question number six, is our Roth IRAs truly a tax free haven for retirees and how might the immediate tax benefits of other retirement accounts compare in the long run? That’s a report that we actually do. How could pension choices between lifetime income or lump sums, big question, influence your tax obligations over time? How might your dividend yielding investments be optimized for tax efficiency? Given the lower tax rates that you get on qualified dividends? As you juggle various retirement income sources? Are you considering the long term in tax impact and not just the tax implications of that one year? And then lastly, question 10 that we think is a pretty thought provoking question is with the broad tax spectrum of retirement income. How often are you revisiting your tax planning strategy or bigger question? Do you even have one at this particular point? Just to make sure you’re positioned, if anything changes from a law per spective which we anticipate we really want to make sure you got that together. Yeah, good

 

Joe Krause 

stuff as we get into our first break. We thank everybody for tuning in to roadmap to retirement. The radio show again, upcoming workshops. There are four opportunities at four different locations for Tuesday and Wednesday go to thrive, financial services.com Back in a moment. Here are four opportunities this upcoming week to get educated and get registered for an upcoming Thrive workshop on Tuesday, November 14 at the William Penn inn, and also Tuesday, November 14 at the brick side grill, then two opportunities on Wednesday, November 15, the Marshall tin in and Karluk cheese waterfront go to thrive financial services.com for all the information get registered get educated that’s Thrive financial services.com

 

 

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Brian Fritz at the Fritz and beyond Cooley Law firm called 215-458-2222.

 

Joe Krause 

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Joe Krause 

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Joe Krause 

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educated and learn about your roadmap to retirement every Saturday morning, right here starting at 8am. Join David Bazar, Karen Bazar, and Brett Elam of Thrive financial services, who will teach you about taxes in retirement, Social Security and how to navigate and create a retirement plan that will provide you with peace of mind. Learn from a local company Thrive financial services and advocate and a resource for you and your retirement. Every Saturday morning from eight to 9am on Philadelphia’s am 990 V answer. It’s roadmap

 

 

to retirement the radio show on Philadelphia is a 990. The answer back

 

Joe Krause 

here on roadmap to retirement the radio show we’ll say it as many times as we can say it today. We thank all of our veterans on this Veterans Day and this Veterans weekend every day is Veterans Day. Thank you very much, David, over to you.

 

David Bezar 

Yeah, so we we just went through the 10 thought provoking questions that we want to get answered during the show today. Quick reminder, before we jump into it, the best way is to take the education that we’re providing on the show. And then how do I figure out to implement that? The easiest way is start with our tax guide. You can get that tax guide by texting the word plan to 215-999-3272. We’ll send that out to you. And again, like I said in the last segment, take us up on that offer right get a 15 minute phone call discovery phone call, ask a couple of questions after you read the tax guide. If you want to get an analysis done, where we really dive in to show you what taxes are going to look like along with Social Security and your portfolio’s risk management and a stress test on the overall retirement all those things. Spend about 45 minutes to an hour with us. We’ll get back again, you know another time and we’ll share all that. And then if you need our help, you’ll let us know and if you don’t and you say hey, I could do this on my own. We’re going to wish you well and our door always be open and available. 215-999-3272 text a word plan. It’s

 

Joe Krause 

an amazing offer. It really is.

 

David Bezar 

So here’s the thing. Did you know that tax the tax landscape out there today? You’ve been navigating it during your working years, though it might have seen challenging was really the calm before the storm and I think people really come to understand that. Right? Think about the multiple pots of money you’ve stashed away for free tyerman, your IRA accounts, your 401 K’s, your stock portfolio and your brokerage account. And of course, kind of Social Security benefits, maybe a pension. These aren’t just income sources. They’re individual junk jigsaw pieces in the vast puzzle of taxation. And I think that’s a great description, right? It is this jigsaw puzzle, that when you look at the pieces scattered on the table, it’s hard to figure out how it all fits together. And here’s the kicker, every combination of drawing from the sources of income can end up putting you in a vastly different tax scenario. Some combinations can be kind of like a sweet symphony, minimal taxation, while others, just let’s just say Uncle Sam might send you a thank you note at the end of the day, because you didn’t make the right decisions. And that’s our goal is to prevent from preventable, Sam from getting too much of your money in retirement. So this is what we’ll dive into during today’s show. So I’d say really, you know, get that pen out, get that pad of paper out, start taking some notes on this. And what we’re going to do is we’re going to help you keep every additional dollar in your pocket versus paying that out to Uncle Sam. And

 

Bret Elam 

let’s be real here, again, to truly live your dream retirement, every single dollar counts, and ensuring your tax efficient, not only just this year, but the next year and the years to come. That’s what’s important. And David talked about it a little bit ago, it’s like one of the reports that we take people through is giving you that year by year schematic, and stressing the importance of forward tax planning decisions that must be made in their current calendar year in order to set yourself up for efficiency. And that’s what we do. We’re right here. You want to text us at 215-999-3272. Again, you can get our tax guide, again, text, the word plan to to 15999327 to again, you can text us where we could set up that initial 15 minute consultation call, or we’re more than happy to sit down with you especially as we’re hitting the year end here. We have a couple of weeks left for 2023 tax planning, you can also visit our website, which has some some phenomenal resources as well. But again, let’s take that first step together. Again, text us text a word plan to to 159993272 What’s all about us bringing that confidence that you’re looking for in that peace of mind so that you can enjoy life. So again, if you’re not proactive on your taxes, more of your income could disappear. And what we’re gonna call is into that taxation vortex. And as a result, your savings may dry up before you’re ready. And that’s not the retirement dream that anyone envisions. But the way that you might help is through one of those personal consultations. So again, you want to text us at 215-999-3272. Again, text the word plan to 215-999-3272.

 

David Bezar 

So I’m going to talk to you about three reasons. And this is one that people tend to fight on, right, they don’t want to buy into this. But I think more and more people are getting suspicious that taxes are probably couldn’t be higher in the future. So when I when we do our seminars, when we do our webinars, when we do the radio show, when we do our podcasts, it’s really trying to build the case, mathematically legislatively, and then just kind of it has to happen, our deficit just you know, we’re in a spend happy government, somewhere along the lines, the bills gotta get paid. So let’s talk about the three reasons that taxes might be higher in the future. Reason number one. So let’s start with the most common misconception that’s been floating around. Like how many of you have heard or maybe even believe that once you retire, your tax obligations will shrink down? Kind of sounds logical, I’m not working anymore, right? So I should end up making less money or have less income, so that, you know, taxes will be less well, you’re not working anyway. But here’s what the reality where it takes an actual sharp turn many advisors, brokers, so called experts will pull a number out of their head saying you need maybe 75 to 85% of your pre retirement income. But having held the hands of countless individuals who have transitioned into retirement over the past 35 years that I’ve been doing this, Joe, I’ve seen a very different story unfold. Picture this, you’ve spent decades dreaming of your golden years, maybe cruising around the world or picking up that hobby you always wanted. That means in the initial years of retirement, you might be digging deeper into your pockets than antas to pay it. And if you’re withdraws from taxable accounts go out to pay up on these expenses. Guess what? So do your taxes. Combine that with fewer tax deductions, no mortgage anymore. So you don’t have the interest to write off adult kids, you know, kind of live in their lives and ask it Hey, Dad, Hey, Mom, can you help out a little bit? And you’ve potentially got yourself in some bit of a pickle from a tax perspective?

 

Bret Elam 

Yeah, now we’ll dive into this. And

 

Joe Krause 

from a cash flow.

 

Bret Elam 

Absolutely. The second reason your taxes might be higher in the future. I remember given our seminar in February of 22. And the big news was we just went through $20 trillion in debt. Today, we’re approaching $34 trillion in debt every second, every minute, we’re borrowing more and more and more. And there’s that looming shadow of repayment, one of my favorite websites called US debt clock.org, you just see that clock spinning of how fast we are continuing to go into debt. And the math is simple. The money has to come from somewhere. And we hear about it all the time where politicians say the tax hikes are only going to target the wealthy. But do you buy that it hasn’t happened yet? I’m not sure it’s gonna happen into the future. But if you think about it, the IRAs and 401 k’s are brimming with n tax dollars. And who’s to say they won’t target those next, we talk about tax rates in 2017. Those rates for the 25% brackets were at the income levels of $76,000. And just with the tax bracket expansion for 2024 $380,000, is where the 24% tax bracket ends. So reason number three. And finally, a definite looming cloud on the horizon is in 2026, is the expiration of the 2017 tax cuts and Jobs Act. And what I just shared right there unless Congress miraculously and I don’t have faith on this wave, some kind of a magic wand, many of us are in for that big surprise, because we’ve been used to where tax rates have been since 2018. And it’s not going to be a pleasant surprise, or what you’re going to find is we’re going to have to dig our hands in our pockets more for Uncle Sam.

 

David Bezar 

Yeah, one of the one of the slides in the presentation that we do at our seminars, shows the impact from a percentage standpoint, how much taxes will actually increase if the Jobs Act of 2017 expires, and we convert back to those pre 2017 tax rate.

 

Joe Krause 

And what does that look like?

 

David Bezar 

So if you remember, well, you know, here’s the big thing, right, Joe? People get lulled into a sense of security, sometimes they want to believe but you know, look, you know the old center. I know people probably call it on this one. But do you know how a politician you want to know if how a politician is lying? Their lips are moving? Right? You’ve heard, and this is not a political statement. But we’ve heard if you make less than $400,000 a year, you don’t have to worry about your taxes going up. The reality is in the 2017 tax cuts, when it expires, the people that will get hit the biggest, the biggest percentage increase are people who are in the currently in the 12, the 10 to 12. And what the 15% tax bracket. That’s right. They all go up on average, more than 15% increase. One of them’s a 25% increase, which is the 12% bracket goes to 15%. Yeah,

 

Bret Elam 

and, and a 22. And a 24%. Brackets are going to be impacted significantly as well, all the people under $400,000. And that

 

David Bezar 

represents 99.99% of all income earners in the United States are going to get the largest percentage increases while the wealthy people, people making more than 400,000 are getting the least increases. It’s just crazy, Joe. So look, these aren’t just three random reasons I’m tossing out there about taxes going up. This is the actual wake up call that we’re trying to drive. It’s high time we really get our heads around how our future retirement income is going to be taxed. The more we get this the better shot we have at becoming more, you know, keeping more of our hard earned money in our pockets versus it going out to the IRS Uncle Sam and having them squander it. It’s really important that gets done. Again, Joe The first step is texting the word plan p l a n to 215-999-3272. We’ll get you out our tax guide. You’ll also see the ability to schedule that discovery call. Where a full blown complimentary consultation, Joe that consultation we do typically takes about 10 hours. We’re fee based financial planners, we charge $350 an hour for the work that we do. If people schedule that appointment in the next 60 days, we will completely underwrite that cost. It’ll be totally complimentary. You come in past that you’re gonna have to pay us 3500 bucks to get that report done. And

 

Joe Krause 

the important thing in that statement as we go to the break, the only way for us to hold off the wolves is to take action spot on. Back in a moment. Here are four opportunities this upcoming week to get educated and get registered for an upcoming Thrive workshop on Tuesday, November 14 at the William Penn inn, and also Tuesday, November 14 at the brick side grill, then to opportunities on Wednesday, November 15, the Marshall tin in and Karluk cheese waterfront go to thrive financial services.com for all the information get registered get educated that’s Thrive financial services.com

 

 

This is Philadelphia’s am 990 The answer? According

 

 

to Forbes 96% of Americans claim their social security benefits at the wrong time. 96% and this mistake could cost them an average of $111,000 Can you afford to lose $111,000 in Social Security income? I didn’t think so. Learn how you can avoid this with a free social security analysis from Thrive financial services Thrive Financial Services is right here in the Philly area. And the professionals at Thrive have been featured in Kiplinger’s The Wall Street Journal, and in 2020 was inducted into the Inc 5000. Among some of the nation’s fastest growing private companies. This amazing team is here to help you if you save more than $250,000 and have not filed for Social Security benefits. Be one of the first 10 callers to schedule your free social security analysis now at 215-798-9088. That’s 215-798-9088. While you learn in this free analysis could help you save a fortune. Call 215-798-9088 Nothing in this advertisement is intended to give you specific tax or investment advice, consult your local on tax or financial advisor. Delaval

 

Joe Krause 

insurance wants to save you 40% on your car insurance right now and they will do it today. Here’s Managing Partner Jimmy O’Brien, a

 

 

lot of people pay a lot more premium than they need to, and they may not have the coverage to to justify what they’re paying, there is

 

Joe Krause 

no charge for the complimentary insurance review. You will save money and you will connect with a company that is an advocate not a broker, go to dvigi.com or simply call Jim at 215-354-0122. That’s 215-354-0122.

 

 

I’ve met clients that think that I as an independent agent charge a fee versus going direct to Geico or going direct to progressive. We do not charge a fee. Let

 

Joe Krause 

del Val insurance save you up to 40% on your car insurance. Get your complimentary review call Jim Neil Brenner directly at 2153540122215354012 to your savings are a phone call away. Before the opening bell on Monday contact David bizarre Karen bizarre or Brett Elam fri financial services 215-798-9088. Get on the original roadmap to retirement and get yourself educated about the tax benefits of a Roth IRA. It’s your roadmap to retirement. And it starts by getting educated from advocates who will help you navigate your own roadmap to retirement, leave a message at 215798 90 Ada. Now

 

 

back to roadmap to retirement, the radio show on Philadelphia, I am nine at the answer.

 

Joe Krause 

Back here on roadmap to retirement the radio show again, you heard one of the destinations for one of the upcoming workshops in the last break, just go to thrive financial services.com In Thrive financial services.com. And that’s how you can get registered for one of the upcoming four bred over to you is on

 

Bret Elam 

today’s show. We’re talking about the tax spectrum of all the different retirement income sources and we just went through the three reasons we believe that tax rates are gonna go up and own invite the listening audience to text a word plan p l a n to 215-999-3272 and get our 2023 tax guide which can help you navigate through the year end. You text that 215-999-3272 We can get you that initial consultation, whether it be a conversation or coming in as well as we do have a couple of weeks left here in 2023. So let’s dive deep talking about some of the different income sources. Again, how are they going to be taxed differently? So this might be old news for some. But here’s a jaw dropper for many who have just hung up their work boots. A chunk of your Social Security benefits could to end up in the tax man’s pocket, again, when Social Security first started, it was never taxed when President Reagan came in up to 50% of it could become tax. And then when President Clinton came in as much as 85% of your Social Security benefits is now subject to taxation. But hold on, not everybody gets done. And actually, the social security administration came out and said, over half about 50%, to be precise, do end up paying, and those 50% that the 6% are the ones that have assets. So it’s important to navigate it as much as you can to try and keep that Social Security tax reduce. But here’s the kicker, as much as 85% of those benefits may be subject to the tax chopping block.

 

David Bezar 

So let’s unpack that a little bit. If you’re filing taxes as an individual earning as an example, $50,000 a year annually, and collecting a consistent $1,500 a month from Social Security, you’re looking at annual Social Security income of 18,000 bucks, here’s the curveball based on the nature of your additional income outside of Social Security, up to 85% of those benefits, or $15,300 could end up being taxable. So just let that sink in for a second. Just let that sink in for a second.

 

Bret Elam 

So the crux is this, where’s that additional $50,000 coming from? Now, if it’s coming from your traditional IRA or 401k, brace yourself, because you’re so security might get hit significantly, by taxes. However, if the $50,000 stems from qualified distributions from a Roth IRA, you might just sidestep those taxes altogether. That’s the question we asked all the time as to who has that retirement playbook of exactly when to do what, where and how, upon retirement, and people always laugh. They’re like, What are you talking about? I get it. It doesn’t exist. But how do we keep up with all these different things? Now, I’m not implying that everyone should just rush out and convert all of their IRAs to Roth, for some, it may actually backfire. This is the core message that we’re trying to convey here is that taxes and the sources of income, they play a pivotal role in looking at your overall tax liability. Yeah,

 

David Bezar 

and not only taxes on Social Security, but your timing elections also can be very important from an income perspective, because you can get additional income paid to you if you time it properly. And that’s another thing that people don’t think a lot about. So let’s jump over now to another income source, taxable IRAs 401 K’s other retirement accounts. If we put our attention to those types of accounts, or other similar retirement accounts, we understand without a doubt, these are the reigning champs of retirement savings account. This is where most people have most of their money socked away for retirement. Now, the reason for that it’s primarily because of that sweet, kind of upfront tax incentive that’s dangled out there every time you make your contribution. It’s like a siren song drawing you in with the promise of immediate tax relief.

 

Bret Elam 

A lot of people are always thinking about what’s to help today with total disregard of what’s going to happen in the future. And we say what’s worse, besides death and divorce and paying taxes, the interest, more taxes. So when we talk about how health care and taxes are probably going to be your biggest expenses in retirement. Here’s the deal. While these taxable IRAs give you those upfront perks, they are far from a tax free sanctuary. In fact, when the day comes when you have to start pulling that money out, do not be shocked when a familiar figure stands there waiting for his cut. Who’s that familiar figure? Uncle Sam, he’s got his hand out just waiting to collect those dollars. And it’s surprising how many people forget that, that fact that I just shared right there and not factoring it in when you’re doing your retirement planning.

 

David Bezar 

Yeah, let’s paint a picture for a second, right. The next time you glance at your retirement account statement comes in on a monthly or quarterly basis, take a look at it and do a little mental exercise. Picture the account not just in your name, but co owned. Think of it as a joint venture between you and Uncle Sam. Now here’s where things get a little dicey. predicting how much of your account Uncle Sam might claim in the future is akin to gazing into a murky crystal ball tax rates. We don’t know what they’re going to be. There’s a lot, you know, what’s the thresholds going to be? There’s just a lot of moving puzzle pieces that you got to try to figure out there. You end up at the mercy of Congress, and they can do and do tinker with those numbers constantly. Just thought this week alone, right? Plot us, we’re really already staring down the barrel of a tax hike come in 2026, which we mentioned earlier in the show. So the million dollar question is, can you do anything about this? Frankly, I have no idea because a lot depends on your individual circumstance. But what I can say with certainty, is that right now, it might be the time to explore those options to get a strategy in place and plan for those rates, which are going to inevitably climb, the easiest way to do that is text the word plan to 215-999-3270 to start with our tax guide, get the education, get your questions answered by scheduling a discovery call or getting us. Let’s get together on that free consultation. On

 

Bret Elam 

today’s show, we’re talking about the tax spectrum of retirement income sources, we just spoke about Social Security income, we’ve talked about taxable IRAs. Next, we’re going to talk about income from employment and retirement. So let’s shift gears a little bit and talk about tax implications when juggling employment income alongside retirement. Now, I know what you’re thinking, isn’t employment income taxation, pretty straightforward? Well, while it might seem like it should be, it’s got some wrinkles to it, when mixed with collecting Social Security benefits at the same time. So I want you to remember this is that the most popular age that people collect their social security benefits is at age 62. So now, let’s, let’s say you’re not quite at full retirement age yet. But if you got some money coming in from your job, and let’s say it’s more than $21,240, you want to write that number down, because it’s a significant number for 2023. Now, here’s where the waters get a little bit murky. Again, the government’s done a great job of making Social Security complex is while you’re earning, there’s a catch tied to your Social Security benefits. And no, it’s not a direct tax, but it can hurt just as much if not more, because once you cross that threshold of $21,240 of earnings, you’re likely to see some of those anticipated Social Security benefits slip away. In fact, the Social Security Administration will deduct $1 from your benefit for every $2 that you earn, greater than that $21,000 figure. Now this reduction is reduced and older ultimately disappears in the year that you hit your full retirement age, which is pretty much 67 these days. But before then, it can be a sneaky backdoor deduction that many do not see coming. But it’s vital to be aware of it, especially when planning your finances, in these hybrid working retirement years, and if you’re not sure, and that sounds like a mouthful. My recommendation is to text the word plan to 215999327 to again text a word plan to to 159993272 We’ll get your 2023 tax guide or more to talk we’re more than happy to talk to you about all these different sources of income that we have coming in, get

 

Joe Krause 

the guide go to thrive financial services.com as well to get registered for the upcoming workshops back in a moment. Here are four opportunities this upcoming week to get educated and get registered for an upcoming Thrive workshop on Tuesday, November 14 at the William Penn inn, and also Tuesday, November 14 at the brick side grill. Then two opportunities on Wednesday, November 15, the Marshall tin in and Carlucci is waterfront go to thrive financial services.com for all the information get registered get educated that’s Thrive financial services.com

 

 

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It’s roadmap to retirement, the radio show on Philadelphia is a nine at the answer. Welcome

 

Joe Krause 

back, everyone for our final segment on this edition of roadmap to retirement the radio show. David, I’ll toss it over to you. I’m quiet today. I’m trying to process and keep up with the conversation very, very intense today.

 

David Bezar 

Yeah. And Joe, you commented in the break. And let me just let me send a quick reminder out to our listening audience. You know, we we record the show, and it goes out on our podcast, I would say this is one show that you’re gonna want to listen to four or five different times Joe made the comment in the break. This is intense. There’s a lot we’re covering a lot. But it’s a lot of information that does need to be covered. So you can find us on our podcast on Apple and Spotify on on

 

Joe Krause 

the website and go to the website. And you can download it or Apple Spotify, or wherever you get your podcasts. But definitely, as you said, David, one to consume multiple times. Yeah,

 

David Bezar 

no doubt. So let’s continue with it. We’re going to jump into the topic of Roth IRAs. That’s next on our radar, Roth IRAs. In the grand scheme of taxes, there’s one phrase we all love to hear. That’s the word tax free. And that’s the one of the benefits of Roth IRA accounts. Like when you play your cards, right? The money you pull from them does not owe a dime to Uncle Sam, nor should it impact the taxation of your Social Security benefits. It’s really a great thing to have money in. But

 

Bret Elam 

then there’s always a but there’s a caveat is the IRA has been partly you got to talk about the Roth IRA has its weaknesses. Now, before you tap into this tax free strategy, you’ve got to help ensure those withdrawals are what the IRS calls qualified distributions. Because if they are not, that’s when the Roth IRA loses its power. Again, there’s rules like contributions, conversions and earnings. There’s so many misperceptions that are out there. And what do we try to do the listening audience week in and week out, is bring awareness to these conversations. And what’s awareness? It’s conversations that need to be had that you didn’t know that needed to be had by asking a series of questions that you didn’t even know that needed to be asked nonqualified withdrawals from a Roth IRA, they can hit you with both taxes and penalties. Imagine setting up a strategy only to have it unravel due to an oversight. That’s an ouch, no

 

David Bezar 

doubt. So the bottom line, while Roth IRAs offer tax advantage, always tread carefully. Make sure you’re working with an advisor who has the knowledge to keep you in line with IRS rules so that the tax free component can stay alive. And you could make sure you end up steering clear of any unpleasant surprises. Joe just want to remind our eyes just very quickly, you know, one of the things as fiduciaries, and being a boutique firm like us and a specialist in what we do, we get it we understand how taxes work. And unfortunately, this week, we had a we had a client leave us and it’s very rare occurrence that happens. And I dug into it a little bit. And the client who left was convinced on two things. Number one, the person who was talking to him was an insurance agent. So not a fiduciary, a commission salesperson that specializes were maybe not specialized in insurance. What we have done for this client is put together an entire tax plan and this person came into some great wealth unexpected, I would say unexpected, but persons making $60,000 a year for 40 plus years, ended up with a big pension distribution of close to $6 million. He really needed guidance really needed an expert in what they do. This insurance agent convinced him to put the vast majority of his money into annuities, and it completely derailed decoupled our tax plan. And I’m really concerned for this person but you know, insurance agent who’s a good salesperson apparently convinced him that’s the right path and

 

Bret Elam 

masters Roth IRA,

 

David Bezar 

totally messed up the Roth IRA account. I feel terrible. We’ve tried to get back in touch with the client. It’s a passionate plea, but it’s fallen on deaf ears. You know, the only reason they share that it’s just that cautionary tale. Be careful who you work with. Yeah.

 

Bret Elam 

So again, today’s show, we’re talking about the tax spectrum of retirement income sources. We’ve talked about the three reasons why we believe taxes are going to go up and we’ve talked about the intricacies of how each of the day different retirement incomes are different. As we’re collecting them. We’ve talked about Social Security, taxable IRAs, Roth IRAs, talking about what happens if we’re working while in retirement, we want to talk about pensions. We’ve touched on some of those common resources, however it’s taken, it’s worth looking at some of these other sources that are out there pensions, pensions, retirees often are left with a choice, and you get one chance to make a pension decision. And those chances not only making the right decision, but it’s understanding they also have tax implications, depending upon the decisions you make a lot of times choices, lifetime income, versus lump sum payment, but people don’t necessarily take into regard to taxation related to it, the legacy associated with a pension, but understanding all of that can help you make the right decision and most importantly, in a tax efficient route as well. Yeah,

 

David Bezar 

so pensions are one additional source of income compared to everything else we talked about. Another one is capital gains, right. So for retirees with investments outside of IRA accounts, and other types of retirement accounts, understanding the tax implications of capital gains is critically important. strategies around tax deferral, and leveraging this is important, leveraging lower tax rates can be very beneficial. The step up in basis upon inheritance is a key factor to consider when you’re thinking about estate planning. It’s something that we see people don’t have a clue of how that factors in and Congress’s attack on that one, right? Constantly, right? So capital gains, the next one is dividends. qualified dividends enjoy a lower tax rate, which can significantly benefit retirees with dividend yielding investments. And then lastly, from the kind of other income source pile is municipal bonds, income from your missile bonds is generally exempt from federal tax. However, if the bonds are from another state, there may be some state implication, we do share with our clients, there are triple tax free type bonds that are now coming back into favor because of interest rates and things of that sort.

 

Bret Elam 

What you find is long term tax planning is what’s key here. You know, every night that I conduct a workshop, I asked the listening audience it goes, anybody in the crowd get agitated that maybe the former president or, or companies like Apple or Amazon, maybe, quote unquote, not necessarily pay their fair share of taxes, and everyone gets their hand up? The question I always ask is, do you feel like they’re doing it illegally? Or maybe they’ve hired a team of people that may understand the IRS code better than the people that that wrote it themselves? So again, if we tackle that headline, again, tackle the topic that often splashes across the headlines, and you’ll get it you see it all the time, is the notion that the wealthy aren’t paying their fair share of taxes. Now, is there any truth to this? If there is, again, it’s vital to understand one thing, it’s less about them sidestepping the law, and more to do with carefully navigating the tax code that Congress lays out. And that’s where you need an advocate and a leader to take you there. And given our discussions today about the myriad ways of how all these different income sources are taxed. It’s evidence of how this can happen.

 

David Bezar 

Yeah, so we covered a lot, right. Yeah. And I know you mentioned the word intense. But no pain, no gain.

 

Joe Krause 

Yeah, no necessary necessary to understand for sure.

 

David Bezar 

But isn’t it pretty easy to recognize why this is a topic that a lot of people avoid? Oh,

 

Joe Krause 

my goodness, for sure. Right. That’s exactly what I was thinking a few different times. And this is why people might not push themselves to take the next step. And that’s next step is the one that will get provide the clarity.

 

David Bezar 

Yeah. And again, there’s two ways to approach it, right. There’s the people that want to get the education, go down the deep dark, warm hurl hole trying to figure it out, and then try to apply it themselves. And then there’s people say, hey, you know, I love eating hot dogs. I just don’t want to know how they’re made.

 

Joe Krause 

Yeah, but even if I knew, even if I knew today, based on the laws, what the tax implications meant. Tomorrow, I don’t know. Because it’s a change, constantly changing. constantly changing. Yeah.

 

David Bezar 

Think think about this, Joe. Let’s say you don’t have GPS and you know, you’ve taken a trip to a road trip that’s maybe 234 hours and you’re driving down the highway and you know, the path right you know, the route back to your hand. It’s easy to do, but all of a sudden road construction, right? They veer you off the highway. And now you’re in a neighborhood you’ve never been in before you have no idea you don’t have a map, you don’t have anything, you know, what’s the chance of successfully, you’re going to get to your destination? I mean, that’s yet that’s unfortunately, what we have to deal with when it comes to taxes, we can put a strategic plan in place today. But Congress may come in and start changing rules. So if you’re not adept at, you know, kind of adopting change, studying it, and then being able to come up with the proper recommendations, you’re gonna be out of sorts. I mean, it’s just that’s just the way it is. Look, you know, as we’ve seen, there are vast differences in how income sources are taxed or not taxed, which offers a potential where savvy tax strategies can and this is the important word, legally make a very significant difference. Right. And here’s kind of the kicker, it’s not just a game for the elite, I really, I hammered that home. When I talk to people we bring, what I tell people is we bring Wall Street strategy to Main Street people, right? We’re the ones that have made that fancy high finance, got it down to, you know, kind of layman’s terms, and we help mainstream people understand how they can apply it for themselves. So for the vast majority tax planning translates to that annual ritual, you know, where you hand over all your financial documents to the tax prepper and cross your fingers and hope that maybe you get some savings, but what most of the fluent people and shrewd retirees grasp. True tax planning isn’t about reacting to your tax bill year after year. It’s about looking ahead strategizing, coordinating your assets and income sources in a way that you can handle those future tax implications. It’s about being proactive. It’s a chess game, we’re here to help.

 

Bret Elam 

And when it comes to charting your financial future, the reality is there’s a sea of advisors out there willing to steer your ship. And yes, there’s even there’s an option of sailing solo without professional guidance. However, the important question to ponder is this. Does your current navigator including yourself truly understand the intricacies of long term tax planning, and its integration with your retirement and investment blueprint, you see, the journey to a fulfilled retirement isn’t just about the size of your savings or the returns on your investments that everyone talks about. It’s about the knowledge, the foresight, the strategies that can help you retain more of what you’ve painstakingly have accumulated. You want to text us to 215-999-3272 text a word plan the 215-999-3272, we can get you a copy of our 2023 tax guide. And we’re more than happy to schedule that appointment to start taking you through your journey to Tax Freedom. And

 

Joe Krause 

I know we’re gonna run over here real quick before we say goodbye. But David, I want you to hammer this point home for me. You must work with a fiduciary honor present. I mean, that is there’s consequences

 

David Bezar 

to be paid if you’re not working with the right type of person. roadmap

 

Joe Krause 

to retirement to radio show on this Veterans Day weekend. Again, we pay tribute to all of the veterans on behalf of David Bazar, Brett Elam, and all of our listeners tuning in to roadmap to retirement the radio show get registered, get educated, go to thrive, financial services.com See you next time, everybody.

 

 

Thanks for listening to roadmap to retirement the radio show from Thrive financial services. If you’re like most Americans, you have more questions then you do answers about what to do with your retirement savings. If you have a question about your IRA or your 401 K, pension or other tax deferred accounts. If you have a question about reducing taxes, generating income or filing for Social Security, whatever it is, David Caron and Brett are here to help. Often your questions can be answered in a simple phone call. Just call 21579890882157989088. And so you know no statements made during roadmap to retirement the radio show shall constitute tax, legal or accounting advice. You should consult your own legal or tax professional on any such matters. information presented is for educational purposes only, and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investment or investment strategies. investments involve risks and unless otherwise stated are not guaranteed. Be sure to first consult with a qualified financial adviser and or tax professional before implementing any strategy discussed here. David bizarre Brett Elam and Karen bizarre have thrived financial services and thrive Capital Management are licensed to offer investment advisory services through Thrive Capital Management LLC. an SEC registered investment advisory firm office headquarters is located in Fort Washington and offices of convenience used exclusively for client meetings in Exton Yardley and Cherry Hill roadmap to retirement the radio show is a paid commercial announcement from Jacob media partners. If you’d like to learn more about the power of the radio our contact Joe Kraus at 267-261-3428 Today’s program has been pre recorded. Here

 

Joe Krause 

are four opportunities this upcoming week to get educated and get registered for an upcoming Thrive workshop on Tuesday, November 14 at the William Penn inn, and also Tuesday, November 14 at the brick side grill, then two opportunities on Wednesday, November 15, the Marshall tin in and Karluk cheese waterfront go to thrive financial services.com for all the information get registered get educated, that’s Thrive financial services.com. So what

 

 

would you do with an extra $187,412 in retirement savings, that’s how much money a local retiree could save in taxes just by using some simple tax planning strategies from Thrive financial services Thrive Financial Services is right here in the Philly area. This team of professionals has been featured in Kiplinger’s The Wall Street Journal, and once more in 2020, they were inducted into Inc 5000 among some of the nation’s fastest growing private companies in the country. Why? Because educating their clients is first and foremost their highest priority. With thrives free tax analysis, you can learn exactly how much money you can save what you learned could help you save in taxes. If you’ve saved more than $250,000 Be one of the first callers to schedule your free tax analysis now at 215-798-9088. An extra $187,412 could go a long way in retirement called 215-798-9088. That’s 215-798-9088 Loving in this advertisement is intended to give you specific tax or investment advice, consult your own tax or financial advisor