Think ahead. Don’t Let

Day – To – Day

Operations Drive out Planning

Mac Advisory Group

Leading Retirement Planning & Strategy Consultants

At the Mac Advisory Group, we are trained to help our clients avoid many of the common pitfalls that can happen during retirement income planning.

We will help you protect your hard-earned retirement assets in diverse market conditions and help you earn the income you need to spend a happy and secure retirement life.

Your Retirement is Our Business

Our clients are the most important people in the world to us. We care for you and help you attain your goals for a safer retirement. Whether you are years from retirement, getting ready to enter retirement, or already retired, we are here to help you plan a hassle-free retirement future.

You can protect your 401k from another market crash with an In-Service Non-Hardship Withdrawal/Rollover.

Some of the Compelling Questions That Might be Bothering You

  • Am I structuring my assets in a way to maximize income and minimize taxes?
  • Will re-positioning my assets lower or eliminate the tax on my social security?
  • Is there a way to get reasonable returns without risking my nest egg?
  • Is it possible to have tax-free income during retirement and reduce my tax liability overall?
  • Can I pay for nursing care without sacrificing my children's inheritance and my spouse's lifestyle?
  • How can I grow my money and potentially beat inflation at the same time?
  • Is it possible I might outlive my retirement savings?
  • How can I help prevent this from happening?
  • How well have I prepared my retirement savings for market fluctuations, inflation, and income taxes?
  • How can I protect my original principal and still supplement your retirement income?
  • What can I do to help guaranteed my retirement income?

Creating any sort of trust does not answer any of the above questions because trust is made to solve your queries and problems. Such as asset protection and not preservation, an extra shield for a lawsuit, skip generation transfer asset(which by the way that could be answered by annuity and drafted in a trust).

And of course, much more, should you need additional information we will be happy to go over them.

Retirement Planning

Retirement planning today has taken on many new dimensions that never had to be considered by earlier generations. Longer life spans have created several new issues that need to be considered while planning for retirement.

Lifetime Income Need

There is a lifetime after retirement, and the need to be able to provide for a steady stream of income is more important than ever. With the prospect of paying for retirement needs for as many as 20 years, you need to maintain your cost-of-living.

Health Care Needs

Longer life spans can also translate into more health issues that arise due to the process of aging. The federal government provides a safety net in the form of Medicare; however, it may not provide the coverage needed, especially in the case of chronic illnesses. Planning for long-term care, in the event of a severe disability or chronic disease, is becoming an essential element of retirement plans today.

Estate Protection

Planning for the transfer of assets at death is a critical element of retirement planning, especially if there are survivors who are dependent upon the assets for their financial security. Planning for estate transfer can be as simple as drafting a will, which is essential to ensure that assets are transferred according to the wishes of the decedent.

Employer-Sponsored Qualified Plans

Most employer-sponsored plans today are established as “defined contribution” plans whereby an employee contributes a percentage of his earnings into an account that will accumulate until retirement. As a qualified plan, the contributions are deductible from the employee’s current income. The amount of income received at retirement is based on the total amount of contributions, the returns earned, and the employee’s retirement time horizon. As in all qualified plans, withdrawals made before age 59 ½ may be subject to a penalty of 10% on top of ordinary taxes that are due.

Depending on the size and type of the organization, they may offer a 401(k) Plan, a Simplified Employee Pension Plan or, in the case of a non-profit organization, a 403(b) plan.

Mac Advisory Group

Paying for Retirement

Retirees who have prepared for their retirement rely upon three primary sources of income: Social Security, individual or employer-sponsored qualified retirement plans, and their savings or investments. A sound retirement plan will emphasize on eligible plans and personal savings as the primary sources with Social Security as a safety net for steady income.

Social Security

Social Security is a safety net for people who pay into the system from their earnings and could rely on it for the rest of their lives. The amount paid in benefits is based upon the earnings of an individual while working. If a person wanted to continue to work and delay receiving benefits, they could do so and build up a more substantial gain. Conversely, early retirement benefits are available at a reduced level, as early as age 62.

Traditional and Roth IRAs

Individual Retirement Accounts (IRA) are tax-qualified retirement plans that were established as a way for individuals to save for retirement with the benefit of tax-favored treatment. The traditional IRA allows for contributions to be made on a tax-deductible basis and to accumulate without current taxation of earnings inside the account. Distributions from a traditional IRA are taxable.

A Roth IRA is different in that the contributions are not tax-deductible. However, earnings growth is not currently taxable. To qualify for tax-free and penalty-free withdrawals of earnings, a Roth IRA must be in place for at least five tax years, and the distribution must take place after age 59 ½ or due to death, disability, or a first-time home purchase (up to a $10,000-lifetime maximum). Depending on state law, Roth IRA distributions may be subject to state taxes.

Distributions from traditional IRAs and employer-sponsored retirement plans are taxed as ordinary income and, if taken before reaching 59 ½, may be subject to an additional 10% federal tax penalty.

In-Service Non- Hardship Withdrawal/Rollover

Some companies allow active employees that are participating in a qualified employer retirement plan to withdraw a portion of their plan’s account balance without showing a specific financial need. You will need to verify with your company if their plan allows this facility.

Why Consider The Option

  • You would like to take control of your assets
  • You have limited investment choices in your current plan
  • Eliminate or lower fees in the current plan
  • Eliminate market risk
  • Provide growth potential with principal and earnings protection

Plans That Permit Non-Hardship Employee Rollovers

Profit-sharing, 401(k)s, 403(b)s, 457s usually will allow these. Defined benefit plans typically do not allow them. Consult your plan’s rules to make sure you are allowed to make these withdrawals.

Are All Assets Eligible for These Rollovers

Each plan is different; you will need to ask your employer which assets in your plan are eligible for these withdrawals. Here are a few samples.

  • After-tax contributions plus earnings
  • Rollover amounts plus earnings
  • Company match contributions plus earnings

And more.

These rollovers are non-taxable if rolled into a product with the same tax status as your initial plan; if not, there might be adverse tax consequences. You should still consult your tax advisor to determine the tax implications of this strategy.

Issues to Consider

There are many different options available to you when it’s time to do a rollover. Choosing the right plan for your needs is the most crucial step. If you are looking for safety with no chance of market losses, then a fixed investment might be the right choice.

How to Get Started

Contact the human resources department’s retirement plan administrator to determine whether your plan allows these rollovers and whether you are eligible to take them and collect the required information.

  • 1.
    How much can you rollover?
  • 2.
    What are the forms needed?
  • 3.
    What are the processing requirements and distribution timelines?

Our firm is not permitted to offer, and no statement contained herein shall constitute, tax or legal advice.
You should consult a legal or tax professional on any such matters.