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Bob Carlson - Retirement Watch

Bob Carlson's - July 2017

Carlson-May2017

Solving the Long-Term Care Conundrum

Long-term care expenses are one of the great retirement fears. For many people, the cost and uncertainty of long-term care are only one reason for the anxiety. Even more anxiety is triggered by trying to sort through the options to fund potential long-term care expenses. Comparing the choices baffles even many financially savvy people and advisers.

In the past, I've presented different strategies and tools to finance longterm care (LTC). This month, I show you how to analyze several choices and pick the one, or the combination, that is best for you.

Read more: Bob Carlson's - July 2017

Bob Carlson's - August 2018

Carlson-August2018

When to Replace Bonds with Annuities

Evidence continues to accumulate in favor of including the right kinds of annuities in your portfolio. Annuities have a bad rap in much of the financial media. Some of that’s deserved, because there are annuities that are complicated, charge high fees and have a lot of restrictions. There also are annuities that are sold to the wrong people. The right annuity, however, will increase your financial security and portfolio returns.

Read more: Bob Carlson's - August 2018

Bob Carlson's - October 2018

Carlson-Oct2018

Multiplying the Money Available for Long-Term Care

Traditional long-term care insurance might be dying, but there are other, and probably better, ways to protect your family and assets from the potentially onerous costs of long-term care.

In 2017, only 66,000 traditional longterm care (LTC policies) were sold. That’s 10% of the number sold 20 years earlier. Steep premium increases on existing policies are the main reason traditional LTC insurance is in decline. In August, regulators in 22 states approved another 58% increase in premiums on some existing Genworth policies. That follows 28% increases in each of the last two years. Other insurers have had significant increases approved in recent years.

Read more: Bob Carlson's - October 2018

Bob Carlson's - September 2016

Carlson-Sept2016

Two Ways to Avoid IRA RMDs with No Out-of-Pocket Cost

We’ve been in the vanguard of showing owners of traditional IRAs how to maximize the after-tax value of the IRAs left to heirs. We do that by minimizing or avoiding required minimum distributions (RMDs) and searching for ways to turn IRAs into tax-free, guaranteed money. In the past, I’ve shown you several strategies that achieve these goals. (See our May and November 2015 issues for examples of these strategies.) Here are two new strategies to consider.

First, I’ll advise these strategies aren’t for everyone. They primarily are for people with substantial IRAs who have enough income and assets outside the IRAs to pay their retirement living expenses. Often they view their IRAs as emergency funds and something to be left for their loved ones.

The first strategy is known as The IRA Reboot. The Reboot is an alternative to converting to a Roth IRA. The important difference is you have no out-of-pocket cost with the IRA Reboot. When a traditional IRA is converted to a Roth IRA, you include the converted amount in gross income and pay taxes as though that amount were distributed to you. With the Reboot, you use several tax code provisions and a special type of life insurance policy to avoid paying the taxes out-of-pocket.

Read more: Bob Carlson's - September 2016

Bob Carlson's - May 2017

Carlson-May2017

Why You Still Might Need Life Insurance

Your estate isn't likely to be subject to the federal estate tax, so you don't need life insurance. Right? Maybe not.

Permanent life insurance was a mainstay of estate planning when even most middle class families faced the federal estate tax. It ensured taxes were paid and loved ones had a legacy.

Read more: Bob Carlson's - May 2017

Bob Carlson's - May 2017 (2)

Carlson-May2017

Leveraging Cash to Pay for Long-Term Care

New ways to plan for potential long-term care expenses continue to be developed. There are many more ways available to secure their own and their families' financial independence than most people realize.

We discussed in previous issues the problems traditional long-term care policies have had in the past. See our November 2012 issue, for example. Those problems are why many people seeking protection from long-term care (LTC) expenses turned to annuities and life insurance policies with long-term care riders. These approaches often allow you to leverage your cash, providing more in LTC benefits than the money you put into the policy. Yet, unlike traditional LTC policies, you have access to your money and benefits are paid to your heirs in many cases. The policies often are ideal when you have cash invested conservatively for emergency needs such as LTC.

Read more: Bob Carlson's - May 2017 (2)

Bob Carlson's - September 2015

Carlson-Sept2015

Investing when Rates are Low, Poised to Rise

What do you do when interest rates are low but the Federal Reserve makes clear it is going to start raising rates? Now, you earn very little money from cash and safe investments. Bonds and similar investments have higher yields, but they're going to lose value when interest rates rise. In many cases, principal losses from rate increases will more than wipe out the higher yields. Today's historic interest rate situation is a difficult one for investors.

Making decisions even more difficult is that interest rates aren't likely to rise rapidly. The decision would be easier if we were on a fast path to normal interest rates. We could hide in cash for a year or two until rates were much higher, and then consider buying high-yielding investments. But I expect rates will rise slowly over several years, because the Fed can't afford to raise rates too quickly. It might damage the economy.

Investors want to know what to do with the bond or income portions of their portfolios in this environment. They want to be diversified so all their investments aren't in stocks, but they don't want to lock in almost guaranteed losses in bonds as rates rise over the next few years.

Read more: Bob Carlson's - September 2015

Bob Carlson's - November 2015

Dear Reader:

Forecasts and predictions will pour forth in the next few months. It’s the time of the year when the financial media are filled with the experts telling us what next year is going to be like. Also, many experts will issue their own detailed forecasts for 2016. Ignore these predictions or treat them as entertainment.

Before considering new forecasts, take a look at past forecasts. You won’t find too many from last year that were very accurate.

For example, a widely-promoted forecast the last few years said the recent federal legislation on foreign bank accounts would cause a collapse of the dollar almost overnight. Readers of the forecast were urged to buy gold and other non-dollar assets. The legislation went into effect and caused disruptions for some people and banks, but it didn’t cause any of the serious effects in the forecast. The dollar’s done quite well while gold’s declined.

Read more: Bob Carlson's - November 2015

Bob Carlson's - August 2013

Carlson-Sept2016

A Fiscal Pain for Many Retired Americans

A fiscal pain for many retired Americans are required minimum distributions from traditional IRAs and other qualified retirement plans. Calculating the distributions and withdrawing the money are chores. People worry about making a mistake that will trigger the 50% penalty. The problems are likely to get worse in coming years as Congress grabs for more revenue.

The tax code requires you to begin distributions after age 70.5, whether you need the cash or not. Each year as you get older, the RMD schedule increases the percentage of the IRA that must be distributed. That's fine when your spending needs equal or exceed the RMDs. But many people have multiple sources of income and large IRAs. They don't need all of the forced distributions. The distributions increase income taxes and can push you into a higher income bracket that triggers higher Medicare premiums and other problems. Many people simply want to let their IRAs accumulate so they can serve as emergency spending accounts or legacies for their heirs.

Read more: Bob Carlson's - August 2013

Bob Carlson's - January 2015

Carlson-Sept2016

Hype About "Secret Accounts" - Exposed

Let's begin the year by revealing the facts behind some rather questionable marketing pitches. Have you heard of the Secret 770 Account? The President's Account? What about Banking on Yourself® or Infinite Banking? Becoming Your Own Banker, The Personal Bank, or The Retirement Miracle?

If you read financial publications, especially online, you almost certainly have heard of some of these. You've been told these financial tools are confidential, new, revolutionary, and of course, Wall Street's hidden secret. You're told that only a privileged few of the well-connected have used them, including presidents, major corporations, and the very wealthy. You might be told banks and Wall Street don't want you to know about them.

Read more: Bob Carlson's - January 2015

Bob Carlson's - October 2015

Carlson-Sept2016

A Higher Return on Safe Money, Plus LTC Benefits

Most of you have a slug of "safe money" on which you'd like to earn a higher return without risking your principal. You also would like to protect your estates from long-term care expenses without the use-it-or-lose-it feature of standalone long-term care insurance policies. There are tools available to help you reach these goals.

In the past we've discussed indexed annuities. (See our April 2014 visit.) Several times in past visits we've also discussed the combo policies, such as annuities with long-term care benefits. Longtime readers know that I don't favor most policies that combine life insurance or annuities with LTC. They have shortcomings such as low returns, high costs for the LTC features, and less-than robust LTC benefits. Once in a while an exception comes along that's worth considering.

Let's start with a review of the basics of indexed annuities.

Read more: Bob Carlson's - October 2015

Winning the War on Stretch IRAs


"Call 888-892-1102 to order the new Required Minimum Distribution Leverage Strategy Special Report for $10.00,
which includes a personalized illustration kit!"


Preserving IRA wealth for children and other younger beneficiaries is a goal of many people. That’s because a large percentage of their wealth is in IRAs and other qualified retirement plans. Two forces, however, stand in opposition to that goal and need to be defeated.

One force is the required minimum distributions (RMDs). After age 70½, annual distributions must be taken from most IRAs and other qualified retirement plans. These are designed to steadily deplete an IRA during the owner’s lifetime, and the percentage of the IRA that must be distributed each year increases. See our March 2015 visit for details about RMDs.

Read more: Winning the War on Stretch IRAs

Retirement Watch June 2014 - Long Term Care Crisis

HEALTH WATCH:
Prevailing in the Long-Term Care Crisis

The good news about long-term care is that the cost is rising at a slower rate. Yet, LTC still is ex-pensive and its cost is rising at a faster rate than general inflation.

The latest annual Cost of Care Survey from Genworth, the leading LTC insurer, at www.genworth.com, found that when LTC is needed the average length of care is about three years.

Read more: Retirement Watch June 2014 -  Long Term Care Crisis

Bob Carlson - RMD Pain to Gain

IRA WATCH:
Turning RMD Pain into Gain

A fiscal pain for many retired Americans are required minimum distributions from traditional IRAs and other qualified retirement plans. Calculating the distributions and withdrawing the money are chores. People worry about making a mistake that will trigger the 50% penalty. The problems are likely to get worse in coming years as Congress grabs for more revenue.

Read more: Bob Carlson - RMD Pain to Gain

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