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.
(Click the featured times below to jump forward in the episode)
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?
Check out some other recent episodes
When you work with a financial advisor, you aren’t just talking about money. Saving for your retirement also includes thinking about what kind of retirement lifestyle you want to have and what you need to keep in mind for the long-run. Do you want to work, by choice? What kinds of expenses will you have and how are they different in retirement? Is your money going to last for 30 years of retirement? Eric has seen his clients through all of these decisions and shares what to keep in mind about retirement.Read More
What kind of personality do you have when it comes to money? Before you put together a financial plan, it’s important to understand the way you think and approach money. We talk through a few different personalities Eric commonly sees and how he advises them. Whether you are spending whenever you get a good excuse to or more of an intentional spender, it’s good to be cognizant of how you handle it and what possible downfalls you may face.Read More
From teachers to engineers, there are a variety of people who work with Eric and his team to build a solid financial plan. Those in similar professions tend to have similar mindsets when it comes to finances. We discuss what similarities Eric sees across different industries and how he approaches each of them. Do any of these relate to you and your financial mindset? Find out what strategies a financial advisor might suggest pursuing.Read More
While no one really likes to talk about it, life insurance can be an important part of your financial plan. We talk about why people cringe when they hear the term, who most needs it, and why you might want to reconsider your preconceived notions about it. Life insurance sometimes gets a bad rap, but it can be a powerful tool. If you care for someone else and you hate taxes, look at life insurance.Read More