A qualified plan is simply one that is described in Section 401(a) of the Tax Code. The most common types of qualified plans are profit-sharing plans (including 401(k) plans), defined benefit plans, and money purchase pension plans. In general, your contributions are not taxed until you withdraw money from the plan.
In a non–qualified plan, there are no deductions, but the principal is never taxed twice. Instead, the interest is taxed once withdrawn.
IRA stands for Individual Retirement Account. It’s a savings account that you can use to put away money for retirement, and potentially grow your funds through investment; there are tax breaks associated with an IRA.
A required minimum distribution is the amount that traditional, SEP, or SIMPLE IRA owners and qualified plan participants must begin withdrawing from their retirement accounts by April 1 following the year they reach age 70½.
Distributions may be withdrawn tax free after five years following the initial deposit.
Pure and simple—they don’t know how. It’s been my experience that most people can appreciate the value in planning. Specifically, planning to avoid making mistakes that so many others before them have made. Unfortunately, the financial marketplace exists to sell products, not advice.
I am a founding member of Ed Slott’s Elite IR Advisory Group. I train throughout the year with Mr. Slott and retain his office in the care of my clients. For more information on this group, go to www.IRAhelp.com. This will provide a deeper insight into how we help our clients.
The IRA beneficiary form, or more frankly, the lack of one. Far too often this beneficiary form is done as an afterthought. This may have big consequences.
All too often, I meet with families to determine who will be on the beneficiary form, only to hear “the bank has it.”
This is a NO-NO and has caused many families an unnecessary amount of pain.
Planning. Few people have a written plan for retirement. Planning is important because it is easier to avoid a mistake than to fix one. We went to college with a plan, we marry with a plan, build our house with a plan, raise our children with a plan…plan our vacations, plan our careers, but when it comes to retirement few people have a set plan.
Usually a rider found on variable annuities that guarantees certain withdrawal benefits.
This is the place where your funds are held. It serves the purpose of holding the funds and preparing tax reporting documents. It is similar to a bank. Some common custodians that John uses are: Pershing, TD Ameritrade, and (TCA) Trust Company of America.
John uses non-traded REITs which means they are not publicly traded. They are typically a 4-year or longer holding, although they do pay dividends monthly or quarterly.
An annuity that is performance-linked to a certain index that usually credits performance annually or biannually. It also protects against loss: if the index is negative, the annuity will credit 0. It also offers a 10% penalty-free withdrawal annually. John commonly refers to this as a client’s “fixed bucket.” A common company John uses is (JNL) Jackson National Life.
If you're ready for highly personalized financial guidance that also strengthens your own financial understanding, talk to JCN Financial & Tax Advisory Group today.Contact us