Today’s Prep:
If your life insurance policy goes up after you turn 60, you may wonder if it’s still something worth paying for. Or maybe you’ve just received an inheritance and don’t know what to expect when it comes to taxes. Eric answers three questions from the mailbag this week.
Equipping Points:
Whether you are reconsidering your life insurance policy or calculating how much to take out of your IRA in retirement, there’s always a lot to consider. In today’s episode of the Retirement Ready podcast, Eric answers three questions from the mailbag that help shape your financial strategy.
Meg in Des Moines asks what the current recommended IRA withdrawal rate is. Eric says the old rule of thumb was not taking out more than four percent to keep from running out of money. That said, it really should come down to your own situation. Make a plan each year that can factor in how much you need to take and then things like home improvements or vacations.
Danny in Waukee has had the same life insurance policy for years but it’s gotten more expensive since turning 60. Should he drop the policy? Eric explains some of the benefits of having life insurance and the way to go about it. Talk with your advisor to create a strategy around your life insurance plans.
Sally in Indianola recently received an inheritance of about 400,000, some in an IRA, some in stocks, some in annuities. How will each of these items be taxed? It’s important to work with a professional to plan for the taxes before you claim these assets. For instance, the SECURE Act put some time restrictions on when you withdraw the funds from the IRA. The annuities and stocks have different rules regarding taxes and what options you have.
Listen to the full episode or click on the timestamps below to hear Eric’s answers to this week’s questions from the mailbag.
0:47 – Mailbag: What is the recommended IRA withdrawal rate?
1:28 – The old rule of thumb was four percent.
4:19 – Mailbag: When a life insurance policy keeps increasing in price, should you drop it?
6:57 – Mailbag: How will an inheritance made up of stocks, annuities, and an IRA be taxed?
Related Resources:
Life Happens: How Will Your Financial Plan Be Impacted?
5 Frequently Asked 401k Questions
What You Should Know About Leaving an Inheritance
Today’s Takeaway:
[spp-tweet tweet= “The thing about buying life insurance is not a matter of IF you’re going to use it, it’s WHEN you’re going to use it. –Eric Peterson“]
Subscribe To The Podcast:
Apple Podcasts - Google Podcasts - Spotify - Stitcher - iHeartRadio - TuneIn
Check out some other recent episodes
Financial Lessons from Aesop’s Fables
Think fairy tales are just for kids? Think again. The secrets to lasting wealth may be hiding in stories you heard at bedtime.
Read More
Periodic Reviews: Tailoring Financial Advice to your Personality
Ever wondered if your financial review truly reflects who you are and what matters most to you?
Read More
Bad Investor Habits to Break Now
Today, Eric breaks down the habits that can turn good intentions into bad investing outcomes.
Read More
Your First Year of Retirement: Don’t Screw It Up
Today, Eric shares the do’s and don’ts of entering retirement and explains why the first year is one of the most critical times in your financial life.
Read More
Debunking Retirement Myths: Smarter Strategies for Your Future
Eric breaks down some of the most common misconceptions about retirement planning and reveals what it really takes to build lasting financial confidence.
Read More
Mailbag: Life Insurance, Housing Decisions & Handling Extra Income
When it comes to retirement, every financial decision counts- but some are more complicated than others. In this episode, Eric tackles listener questions about three real-life retirement scenarios.
Read More
What Golf Teaches Us About Retirement
Golf and retirement may seem worlds apart, but the lessons from the course fit perfectly into financial planning.
Read More
Famous Last Words: Retirement Phrases That Can Cost You
Retirement planning has its own version of those phrases and believing them can lead to painful consequences.
Read More
Retirement Planning Is Harder Than It Looks
Retirement planning often looks straightforward from the outside, but as Eric explains, many decisions can be harder to make than they appear. In this episode, Eric and Marc break down some of the most common challenges retirees face.
Read More
Not All Advisors Are Created Equal
The financial world is crowded with titles- advisor, broker, planner- and it isn’t always clear what those labels mean for your retirement. In this episode, Eric breaks down the critical differences between brokers and fiduciary advisors, using simple analogies to show how each approach your money in very different ways.
Read More