What Is The Most Important Date In Retirement? And What Is A Savers Credit? – Finger Financial Five #45

Jeremy Finger
Jeremy Finger
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“Looking deeper, we could say that the real cause of suffering is not being able to tolerate the uncertainty.” – Pema Chodron

Do you know when you are going to die? If you did, you could REALLY plan for retirement.  You could have a week to go say goodbye to everyone.  Have a going away party.  Buy your loved ones whatever you could afford and spend your last dime on your last day.  

Even if you did know your last day, what you do could negatively affect your loved ones.  For example, I talked to a guy a couple weeks ago.  He is about to retire and wants to take Social Security as soon as possible because he KNOWS he is going to die at age 82.  Let’s say he’s right.   His choosing to take Social Security early could affect his wife’s survivor benefit.  She could live for 10-20 years longer with a reduced benefit.  So in this case, he would need to know when both he AND his wife will pass away in order to plan properly.  And that’s if they want zero money to pass to the next generation. 

In addition, many people fail to prepare their estate properly.  This causes complications for the next generation.  Unfortunately, I have seen families torn apart when there was unclarity with estate distribution.  Please get your estate in order.  

Funny side note: Warren Buffett once said, “I would like to know where I am going to die, so I will never go there.”  Love that guy. 😊

Friend of mine was asking me about retirement and how much to save.  We had a short discussion, then he asked an important question:  “Do I just amass wealth and leave it to my kids?”  No sir, not if you don’t want to.  Well, how do you know what to spend?  You make adjustments.  Sometimes people ask what they need to save 3 years from now?  How much do I need to convert to ROTH IRA in year 4?  Much can change and, when the inputs change, the outputs change, too.  Here is a fun little challenge.  Close your eyes and try to walk a straight line for 20 feet.  Open your eyes.  How did you do?  Were you off by a few inches?  Imagine if you had to walk a mile with your eyes closed.  You may be off course hundreds of yards.  Making small adjustments as life happens is the way to stay on your path.  We communicate regularly with our clients to help them open their eyes every few feet to correct course.  We help people to be flexible and open.  

“A tree that is unbending, is easily broken.” – Lao Tzu

Do you qualify for some free money?  Here is some information on the Savers credit:

  • Credit is a dollar-for-dollar reduction of your federal income tax liability and can reduce the amount of taxes you owe.
  • You must be 18 years old or older.  Not be a full-time student. Not be a dependent on someone else’s tax return.  There are income limitations ($66,000 for Married Filing Jointly).  Many people who do ROTH conversions do NOT think about the credits they lose if they convert too much money.
  • Must contribute to a retirement plan: traditional IRA, ROTH IRA, and other salary reduction contributions, like 401k’s.  
  • Rollover contributions are NOT eligible.  
  • Your credit could be as high as $2,000, if married and filing jointly.
  • Source: IRS.gov

If you have any questions, feel free to email me at [email protected] or Click here for phone appointment

News from around the office: We added another team member to the Riverbend staff.  Roxanne Mut grew up in Connecticut and enjoys cooking.  She married her high school sweetheart 42 years ago. She has 5 beautiful grown children and 7 wonderful grandchildren. She has been blessed to work in the financial industry for the past 23 years with 2 prestigious firms. She enjoys helping others with their financial needs and goals and providing red carpet/white glove service.

On the lighter side, Elliott has not been playing as much tennis this fall, so he is looking for part time work.  Restaurant perhaps?  If you have any ideas, let me know.  My training has been going pretty well.  My back is in good shape.  My belly is still a little too round.  Will work on that over the next couple weeks.  Ironman date is September 18th in Cambridge Maryland.  I have been having dreams where I forget my bike, swim goggles, and few other things. It is getting real.  I think there is an app that can be downloaded to track my progress in real time if you care to do so.


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