How will today's high inflation impact my retirement?

Inflation is definitely a concern, and the media frenzy around current inflation likely isn’t helping ease your current fears. While you are right to be concerned about inflation, it doesn’t necessarily mean it will threaten your retirement plan, even if today’s inflation lasts longer than we first expected.

| Inflation is surprisingly more dangerous than a market crash. |

| Inflation Vs. Social Security and other ‘Guaranteed’ Income |

| Using Multiple Inflation Rates |

| What Should You Do? |

Retirement Planning, InvestingJoshua Escalante Troesh, CFPAugust 1, 2022Retirement & Legacy, Retirement Planning, Individual Retirement Account, Inflation Risk, 401(k)

What should I do with my annuity in its second year if the cap and spread values have been lowered?

I am sad you have to deal with this and it’s unfortunately not uncommon for annuity sales representatives to misrepresent the annuity. As for what to do next, you should determine if it would be better to continue the annuity or give up the money you have already put into it and instead invest using a different strategy. Even though the annuity is a bad investment…

Retirement Planning, InvestingJoshua Escalante Troesh, CFPJuly 1, 2022Retirement & Legacy, Retirement Planning, Annuities, Annuity, Individual Retirement Account

How much of my house-sale proceeds should I use for purchasing a new home?

How much to use will depend on the rest of your financial situation, including your monthly income, the size of your emergency fund, whether you are on track for retirement savings, and even the terms of the divorce. While it is important you get a place of your own, take your time with this decision. You don’t want your excitement over buying a new home to overshadow your rational analysis and decision-making.

Also Covered:

Impacts on monthly cash flow are key
Don’t overspend, especially in this market
Don’t unravel the fairness of the divorce settlement with the home purchase

Life Planning, Investing, Retirement PlanningJoshua Escalante Troesh, CFPMay 1, 2022Buying A Home, Divorce, Retirement Planning, Emergency Fund, Selling a Home

Will Russia's Invasion of Ukraine Impact My Investments?

Following ongoing pandemic impacts and a high inflation report markets again were impacted by the shocking invasion and bombing of Ukraine by Russia. Historically, geopolitical events have had short-term impacts on the world economy and investment markets, so the humanitarian impact is likely to be much larger than the economic one. Also covers:

Historical market reactions to wars and geopolitical events
How you can help Ukraine

Investing, Retirement PlanningJoshua Escalante Troesh, CFPMarch 8, 2022Russia Invasion, Investment portfolio, Stock Market Crash, Stock Prices, Stock Market Correction, Stock

How do I fix a 60-day rollover missed deadline?

I am so sorry this happened to you. Unfortunately, your situation is a common one for people when they retire or change jobs and move their 401(k) account. Handling this rollover on your own creates a lot of tax problems, even if you do everything perfectly. Below are some ideas to help you, but first the answer to your initial tax questions.

ALSO COVERED:

What Happens to Taxes.
Doing a 401(k) or IRA Rollover On Your Own.
Fixing an Indirect Rollover.
Making Up The Lost Retirement Account Balance.
Managing Taxable Investments vs. Retirement Investments.

Retirement Planning, Tax PlanningJoshua Escalante Troesh, CFPJuly 23, 2020Retirement & Legacy, Retirement Planning, Individual Retirement Account, IRA Rollover, 401(k), 401(k) Rollover, Indirect Rollover, Direct Rollover

How will a 401(k) withdrawal impact my taxes at year-end?

Assuming the withdrawal is going to be spent and not rolled over to another retirement account, a partial withdrawal from your Traditional 401(k) will be treated as taxable income when you file your taxes next year. The amount the 401(k) provider deducts and sends to the IRS will also be counted as a prepayment of your taxes for the year, similar to how withholdings worked while working. . . .

Tax Planning, Retirement PlanningJoshua Escalante Troesh, CFPApril 15, 2020Retirement & Legacy, Retirement Planning, 401(k), ROTH 401(k), IRA Rollover, Tax Planning, Tax Deduction, Federal Income Tax

What Do I Do with the Recent Stock Market Crash?

The last couple weeks saw a stock market drop which has many spooked. Here are the 6 things you should do to keep the market downturn from ruining your financial plan.

Investing, Retirement PlanningJoshua Escalante Troesh, CFPMarch 12, 2020Building Wealth, Managing Wealth, Retirement & Legacy, Retirement Planning, Young Families, Starting Out, Financial Foundation, Stock Market Crash, Bear Market, Stock Market Correction, Investment portfolio

Is my AAA financial advisor's advice to invest in an annuity a good idea?

Investing, Retirement PlanningJoshua Escalante Troesh, CFPJanuary 1, 2020Annuity, Annuities, Managing Wealth, Building Wealth, Retirement Planning, Retirement & Legacy, Stock, Financial Advice, Financial Planner Comment

How should I invest my extra income?

Investing, Retirement PlanningJoshua Escalante Troesh, CFPDecember 25, 2019Stock, Inherited Stocks, Investment portfolio, 401(k), Roth IRA, Individual Retirement Account, Starting Out, Building Wealth, Choosing an adviser, Financial Advice

I just paid off my debt and built up a four-month emergency fund; what's next?

Congratulations on giving yourself the foundation for financial freedom. If you were a client, I would respond to your "what's next?" question with asking you the same thing. What is next on your personal life agenda? Think about your major life goals you want to accomplish in your future. Retirement is obviously one of the major ones, but also think about whether you want to . . . .

Life Planning, Retirement PlanningJoshua Escalante Troesh, CFPNovember 6, 2019Starting Out, Financial Foundation, Building Wealth, Young Families, Individual Retirement Account, Retirement Planning, Investment portfolio, Emergency Fund, Debt Management, Debt payoff

What are Self-Employed options to save for retirement without a 401(k)?

Retirement Planning, Business AdvisingJoshua Escalante Troesh, CFPOctober 8, 2019Building Wealth, Business Owners, Retirement Planning, HSA, Health Savings Account, Solo 401(k), 401(k)

Should I use money from my 403(b) account to pay off my credit card debt?

While the credit card company charging 16% interest is annoying, taking money from your 403(b) or any other retirement account to get rid of the debt may negatively impact you financially. Even though you can take the money out without the 10% penalty, you would still have to pay taxes on the money. You would likely lose money on the deal based on how the math works.

Retirement Planning, Debt ManagementJoshua Escalante Troesh, CFPAugust 21, 2019Credit Card Debt, 403(b), Retirement Planning

Can I ask the IRS to allow me to return an IRA distribution after the 60 day rollover period?

Yes, there is potential for relief from the IRS, but ignorance of the rules and weakness in English are most likely going to get denied. At this point you will want to contact a financial advisor and a CPA to help you with this. The CPA will help you in dealing with the IRS and a good financial advisor . . . .

Tax Planning, Retirement PlanningJoshua Escalante Troesh, CFPAugust 1, 2019IRA Rollover, IRA Penalty, Managing Wealth, Building Wealth, Starting Out, 60 Day Rollover

Which is the best strategy to pay off our debt?

My answer: neither is the optimal strategy – but that the home loan is a less-bad strategy. Your financial planner is correct about it being worse to use your IRA money to pay the loans. When you take money out of the IRA you will have to pay the 10% penalty plus income taxes, which should be 22% based on your income. This means to pay off the $50,000 debt you would need to take out . . . .

Retirement Planning, Debt ManagementJoshua Escalante Troesh, CFPJuly 18, 2019Financial Foundation, Starting Out, Building Wealth, Managing Wealth, Retirement & Legacy, Retirement Planning, Financial Advice, Financial Planner, Credit Card Debt, HELOC, Individual Retirement Account

When can I apply for my ex-husband's Social Security benefits?

Getting divorced won’t impact your right to your spousal benefits under your ex-husband’s work record, but other Social Security rules will limit when you can collect. You will likely have to wait for the retirement benefit, but you do have another option since you are disabled. . . .

Retirement Planning, Life PlanningJoshua Escalante Troesh, CFPJuly 11, 2019Social Security, Disability, Divorce, QDRO, Retirement Planning

Should we pay off our mortgage when on fixed income pensions?

I generally don't advise clients to aggressively pay down their mortgage unless they have so much money in retirement assets and income that the mortgage money won't make a difference to them. Unlike what many might suggest, your mortgage does not present a risk to you and your wife during retirement. So long as you can afford to pay your monthly payment and . . . .

Retirement Planning, Life PlanningJoshua Escalante Troesh, CFPJune 13, 2019Retirement & Legacy, Retirement Planning, Individual Retirement Account, Thrift Savings Plan (TSP), 30-year mortgage, Debt payoff, Investment portfolio, Roth IRA, Roth Conversion, Tax Planning

Should I use my 401(k) for a down-payment?

While most people argue against the use of an IRA for purchasing a home, I think it can be a good use of the funds if the situation is right. The fact you are currently contributing to a retirement plan is one of the factors I would want to see, although I'd like to be able to calculate what your current course to retirement would look like. If you are on track with your retirement without the $14,000 then using it for a house would likely be . . . .

Life Planning, Retirement PlanningJoshua Escalante Troesh, CFPJune 7, 2019Starting Out, Building Wealth, Buying A Home, 401(k), Individual Retirement Account, Retirement Planning

If a couple in their mid-50s is unemployed, can they set up an IRA withdrawal using rule 72(t), claim it as income and then re-invest it into a Roth IRA?

Good news, there is a way to accomplish your goal. Sort of bad news, using rule 72(t) won't help and yes, withdrawals from an IRA will impact ACA tax credit eligibility. Although the strategy you've outlined won't work, you can accomplish the same goal through converting a portion of the traditional IRA to a ROTH IRA. This is done by rolling over . . . .

Retirement PlanningJoshua Escalante Troesh, CFPMay 30, 2019Retirement & Legacy, Retirement Planning, Individual Retirement Account, 401(k), 457(a), 403(b), 401(a), ROTH 401(k), Roth IRA, Investment portfolio, Whole Life Insurance, Annuities, Annuity, Financial Advice, Affording College

How should my wife and I begin saving for retirement at 51 years old?

Congratulations on getting your son through college and on moving forward toward your retirement. You definitely need to hit the gas on your retirement savings and it seems like you are well poised to do this. Fortunately, the money which was dedicated toward your son's college can now be focused on your retirement.

At this stage you will want to invest . . . .

Retirement PlanningJoshua Escalante Troesh, CFPMay 27, 2019Retirement & Legacy, Retirement Planning, Individual Retirement Account, 401(k), 457(a), 403(b), 401(a), ROTH 401(k), Roth IRA, Investment portfolio, Whole Life Insurance, Annuities, Annuity, Financial Advice, Affording CollegeComment

Should I match my employer contribution to my retirement account or invest elsewhere?

You are correct, the rule of thumb advice doesn't really apply to you. If it is better you don't invest in the 401(k), the alternative to look at would be opening your own Individual Retirement Arrangement (IRA) account. To determine whether to invest in your 401(k) or to invest in your own IRA, ask yourself the following questions. . . .