Receiving an inheritance is often an affecting experience—marked by a loved one’s passing, the money is a wonderful gift that also gets intertwined in the grieving process.

It shouldn’t come as a surprise that receiving an inheritance involves much more than meets the eye. Today, we would like to take a look at how inheriting an IRA specifically works. 

Many pre-retirees are familiar with traditional methods of saving for retirement such as contributing pre-tax dollars to a workplace 401(k) or 403(b). However, few of them know that contributing to an HSA or investing in an earmarked account intended for health care costs throughout retirement can help them to offset premiums of otherwise expensive long-term care insurance.

Medicare is often inevitable for retirees. Unfortunately, it can also be confusing! You may be wondering:

  • When do I enroll?
  • Will I be automatically enrolled?
  • What type of coverage do I receive?
  • What if I need additional coverage? 

You will have many different income channels in retirement from investments to pensions to cash to one of our favorites and specialties, Social Security. Social Security is a huge part of your retirement income plan. Not only do these benefits replace about 40% of your income, but they also have huge implications for spouses and dependents. 

Making the right Social Security strategy can be a huge asset to your retirement plan. But how do you even enroll in the first place? Let’s take a look!

You’ve seen the headlines: the Federal Reserve hiked interest rates to historic levels. They raised the target federal fund rate by .75%, which marked the most significant increase in 28 years. Here’s what this interest rate means for you, your wallet, and the economy.

Just hearing the word inflation can immediately make your heart race. But is such a response warranted? What is inflation? 

We all dream of retiring one day, though we may have different ideas of what that looks like. Maybe it is escaping to sunny Florida from the colder north! Perhaps you wish to move where you can view the beautiful mountains of Colorado. 

When it comes to financial planning, Wood Smith’s services begin and end with you in mind! We are a fee-only, Fiduciary firm with comprehensive financial services that partners with clients to simplify their financial lives. 

When you’ve earned an income all your life, it can be a challenge to transition to retirement when you enter a ‘decumulation’ phase. Pre-retirees need to take this time to develop a strategy for drawing on their savings that both: 

  1. Provides them with the income they need to live a lifestyle they’re comfortable with.
  2. Effectively minimizes taxes on their retirement income to maximize the longevity of their nest egg.

At Wood Smith Advisors, we believe that financial planning is about so much more than your money. Instead, we subscribe to the idea that a financial plan is created to help individuals and families live fulfilling, meaningful lives using their wealth as a tool to achieve their goals. This is why it’s critically important to create a life plan before sitting down with an advisor to create your financial plan. 

In 2022, new life expectancy tables from the IRS go into effect. The IRS has not updated their life expectancy tables in 20 years. This means that RMDs for retirees and those who have inherited an IRA will be lower than they have been in the past. But, how much lower are they? And how does that impact retirees?

Savings bonds are often something that people have access to either because they purchased them directly, or because they were gifted years ago by a loved one. However, it can be stressful to decide what you want to do with savings bonds after they’ve matured.

Most taxpayers think of their taxes once a year when they file. They assume that gathering all of the information their financial professional, or accountant, needs is the extent of the “planning” they need to do. After all, once the “accounting” is complete, taxpayers will either receive a refund or make a payment to the government if they owe money. Isn’t it just that cut and dry?

Financial advisors can belong to many different types of membership organizations. These organizations serve several purposes:

  1. They offer advisors resources to enhance their services and continue their education. 
  2. They create an advisor community that allows advisors to share ideas to improve their services and add extra value for their clients. 
  3. They often have a “find an advisor” tool that helps consumers find a financial planner who meets their needs.

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