Protecting & Preserving Wealth

In this episode of Protecting and Preserving Wealth, we move to topic 3 in our estate planning series by tackling a critical but often overlooked topic—how to properly title assets. Previously, we discussed beneficiary designations, but today, we dive into why the way assets are titled can significantly impact taxes, probate, and the distribution of wealth.

One common issue we see is with married couples who assume their assets should always be jointly owned. While joint ownership works in many cases, certain assets, like IRAs, must remain in an individual's name. Instead of joint ownership, the key is...

In this episode of Protecting and Preserving Wealth, we continue our discussion on estate and legacy planning, focusing on the critical role of beneficiary designations. Beneficiary forms take precedence over wills and trusts for certain assets, including retirement accounts like IRAs, 401(k)s, 403(b)s, life insurance policies, annuities, and pensions. Bank and brokerage accounts also allow for direct beneficiary designations through Pay on Death (POD) and Transfer on Death (TOD) forms. In Arizona, real estate can even have designated beneficiaries through Arizona beneficiary deeds.

We emphasize the importance of keeping these designations up to date. Failing...

In the second installment of our estate and legacy planning series, we highlight the critical role of beneficiary designations in securing and managing wealth. Estate planning goes beyond wills and trusts; proper beneficiary designations on accounts like IRAs, 401(k)s, annuities, and life insurance determine where assets go upon death, often bypassing wills and trusts altogether.

I emphasize the nuances of Individual Retirement Accounts (IRAs), particularly their "individual" nature and the implications of beneficiary designations. Primary beneficiaries, usually spouses, receive unique advantages, such as the ability to roll over an IRA into their name and defer Required...

In this Protecting and Preserving Wealth episode, we’re kicking off our six-part series on estate and legacy planning. We dive into the critical steps of preparing for the Great Wealth Transfer—an estimated $84 trillion passing to the next generation by 2045. Of that, $72 trillion will go to heirs, making proper planning essential.

We talk about the importance of being ready for this transition. Will your heirs be prepared to manage your wealth? Will it be protected or lost to taxes, poor decisions, or unforeseen circumstances like inflation or bad marriages? These are tough questions but answering them now e...

In this episode of Protecting and Preserving Wealth, we dive into managing the challenges posed by concentrated stock positions. When individuals hold significant investments in a single stock, such as Apple, Nvidia, or Tesla, they may face considerable capital gains taxes and financial risk. To address these concerns, we explore a range of tax-efficient diversification strategies to help reduce risk and optimize income without incurring immediate tax consequences.

We begin by discussing the benefits of community property laws in states like Arizona, where spouses can receive a step-up in cost basis upon one spouse's death, reducing the...

In this episode, we continue our discussion on the economic implications of a second Trump administration, focusing on interest rates, tax policy, government efficiency, and immigration’s impact on the economy. With Bruce Hosler, Alex Koury, and Jason Hosler, we explore how these factors might shape financial decisions for individuals and businesses.

We begin by analyzing the Federal Reserve's approach to interest rates amidst strong consumer spending and near full employment. While a potential rate cut may occur in December 2024, higher rates could persist in early 2025, impacting sectors like housing. The conversation touches on how existing low mo...

In the first part of our two-part series, we discuss the economic implications of Donald Trump's second presidential term, focusing on markets, regulation, energy, and inflation. With the election concluded, markets have responded positively to the reduced uncertainty, reflecting a renewed sense of clarity. We highlight how a Republican-controlled House and Senate could further enhance this stability. Drawing from Trump's first presidency, we examine his policies on deregulation, their stimulative effects on businesses, and their potential for deflationary outcomes, particularly in the energy and industrial sectors. With Trump advocating for increased oil and natural gas production, energy is a...

In this episode of Protecting and Preserving Wealth, we dive into the changes introduced by the SECURE Act 2.0, which has made significant modifications to IRA and trust regulations.  Bruce Hosler and Alex Koury from Hosler Wealth Management explain the complexities and implications of these new regulations.

The conversation begins with Bruce explaining the updated requirements for trusts designated as IRA beneficiaries. Previously, the law mandated that documentation, including copies of the trust, be provided to IRA custodians by a set deadline after the IRA owner's death. Under SECURE Act 2.0, however, this requirement has been relaxed. Now, instead o...

In this episode of Protecting and Preserving Wealth, we dive into donor-advised funds (DAFs) with Bruce and Jason Hosler from Hosler Wealth Management. With the end of 2024 approaching, DAFs are a timely and powerful tool for those who are charitably inclined, particularly those looking to manage tax liabilities while contributing to causes they care about.

Bruce explains that a donor-advised fund allows individuals to donate highly appreciated assets—like stocks, real estate, or even collectibles—without triggering capital gains taxes. For example, if you've held Apple stock for years and it’s gained significantly in value, rather than s...

In this episode of Protecting and Preserving Wealth, we dive into the upcoming changes to Medicare for 2025, focusing on critical issues that affect both current Medicare recipients and those who have yet to claim it. Bruce Hosler and Alex Koury from Hosler Wealth Management discuss Medicare enrollment, premium penalties, and significant updates coming in the next few years.

We start by addressing the complexities surrounding Medicare enrollment for individuals turning 65. Bruce highlights a key nuance: while it may sometimes be beneficial to stay on a company’s health plan, particularly if it's cheaper, there’s a catch. If y...

It’s true, and in this episode of Protecting and Preserving Wealth, we focus on this crucial aspect of estate planning: converting your IRA to a Roth IRA before passing it to your children.  We discuss the importance of making this conversion while you're alive because your children cannot convert an inherited IRA to a Roth IRA after your death.  I will share an example of a client who could have benefitted from starting the conversion process earlier, explaining that even partial conversions would allow beneficiaries to enjoy tax-free growth from a Roth IRA.

Our conversation delves into...

In this episode of Protecting and Preserving Wealth, we delve into the updated 10-year IRA rule for beneficiaries, finalized by the IRS on July 18, 2024.  Under the old Strech IRA rules, beneficiaries could stretch out Required Minimum Distributions (RMDs) over their lifetimes, creating a favorable tax strategy for passing on wealth. However, with the finalization of the SECURE Act regulations, the 10-year rule now applies, requiring beneficiaries to thoroughly distribute inherited IRAs within 10 years, limiting the potential for long-term legacy planning.

The rationale behind this change is to ensure the IRS receives its share of taxable income more q...

In part two of our series with estate attorney Jon Linford, we dive into crucial estate planning considerations as we approach the 2026 sunset of the Tax Cuts and Jobs Act. The primary focus is on the significant changes to the estate tax exemption that will occur when the current law sunsets, reducing the exemption from $13.6 million per person to an estimated $7 million.

We discuss the implications of this change and the urgency for individuals to update their estate planning strategies. Jon Linford explains that the estate tax is a substantial 40% on amounts above the exemption, making it...

In part 1 of our Estate Planning Podcast Episodes, I welcome Jon Linford, a seasoned estate planning attorney from Morris Hall. We delve into the complexities and critical considerations of estate planning, a topic of utmost importance for anyone concerned about their financial future. Jon, who has been practicing law since 2011, transitioned from civil litigation to estate planning, driven by a passion for protecting clients' assets and ensuring smooth transitions for their estates.

The conversation centers on the benefits and nuances of setting up a living trust, particularly in Arizona. Jon emphasizes that while not everyone may need...

In this episode of "Protecting and Preserving Wealth," we continue our discussion from our previous episode, starting with interest rates and the Federal Reserve's actions. Bruce notes that the 10-year treasury rate has risen to 4.44%, highlighting the market's control over this rate rather than the Federal Reserve. Despite predictions of a recession, we don't foresee it occurring this year. The Federal Reserve faces pressure to lower interest rates, which impacts the real estate market significantly. Housing prices have remained stable despite fewer sales, contributing to inflation concerns.

Jason points out the delicate balance the Fed must maintain...

Today, we are taking a midyear look at the financial markets for 2024, focusing on key metrics and trends influencing our investments and financial decisions.

As of our recording date of July 2nd, the S&P 500 has impressively risen over 15%, currently standing at 5,495. Bruce explains that the price-to-earnings (PE) ratio is at 20.99, indicating a slightly higher but not alarming level compared to historical averages. Jason adds that a pullback is possible despite the market’s strong performance, though they remain optimistic about the market’s upward trend through the year’s end.

We delve into the resili...

In this episode of Protecting and Preserving Wealth,' we dive into Bruce Hosler's article, "Moving to Tax-Free: Eight Steps You Can Take for Success." We are joined by Bruce Hosler and Alex Koury, who walk us through these crucial steps to achieve a tax-free retirement.

We begin with the importance of sourcing and engaging trusted advisors. A team consisting of a tax planner, financial planner, estate planning attorney, and wealth advisor is essential. These professionals help navigate the complexities of current and future tax laws, ensuring a comprehensive understanding of one's financial situation.

Next...

In this episode of 'Protecting and Preserving Wealth,' we delve into the significant changes to the Roth Stretch IRA, resulting from the SECURE Act, that came into effect on January 1, 2020. This Act drastically altered the landscape, as it now requires inherited IRAs to be fully withdrawn within ten years, eliminating the lifetime benefit that was once the key feature of the Roth Stretch IRA. 

I explain that the Roth Stretch IRA was an ideal tool for wealth transfer, providing a tax-free, lifelong income stream for beneficiaries. With the new 10-year limit, the tax-free advantage diminishes significantly. J...

This episode of "Protecting and Preserving Wealth" discusses the stock market's behavior during the presidential election years and its implications for investors. As the November 5th, 2024, presidential election approaches, many investors are concerned about market performance under different administrations and the potential for a market crash if the "wrong" president is elected.

Around $5 trillion is currently sitting in cash due to concerns over inflation and global uncertainties, not just the election. However, historically, the stock market has shown resilience and performed well during election years, with an average return of 11.6% since 1926. This data should instill confidence in...

In this episode of "Protecting and Preserving Wealth,"  Jason Hosler and I discuss the firm's commitment to protecting their clients' financial futures. I begin by underlining the company's longstanding dedication to protecting and maintaining money during global volatility, something many overlook.

Delving into my new book, "Moving to Tax-Free," I underscore the practicality of tax protection in wealth preservation. Taxes, a significant lifelong expense for many, can be effectively managed to safeguard financial resources. Jason introduces the 'Magnificent 7'—a group of high-performing tech stock investment strategies—highlighting its potential to prevent missing out on market gains, a pra...

Bruce Hosler welcomes a special guest for today’s episode. We discuss the critical state of the U.S. national debt and its implications for future tax rates with David McKnight, author of “The Power of Zero.” McKnight highlights the dramatic increase in national debt from $5 trillion in 1999 to an expected $54 trillion by 2033. This surge is attributed to unfunded wars, healthcare programs, and economic bailouts. The conversation underscores the lack of governmental action to address the unfunded obligations for Social Security, Medicare, and Medicaid, which pose a significant threat to the country’s fiscal stability.

McKnight points out the...

In this episode of "Protecting and Preserving Wealth," we dive into the significance of moving financial assets to tax-free vehicles, a topic Bruce Hosler has extensively explored in his new book, "Moving to Tax-Free™." Bruce, alongside Jason Hosler and host Jon Jag Gay, discusses the critical nature of planning for a tax-free retirement, emphasizing the importance of strategic financial planning to mitigate future tax burdens.

Bruce opens the conversation by highlighting the central question of whether tax rates in the United States will increase, decrease, or remain the same over the next decade. This question is pivotal as...

We're unpacking a novel concept today: refinancing your retirement.  Amidst soaring interest rates similar to those of the early 2000s, we explore why now might be the golden hour to lock in these rates for your retirement plans.

First, I break it down, highlighting how current high rates offer a rare chance to secure high-income payouts from annuities and their living benefits.  We haven't seen an environment like this in about 15 years.  This environment presents a unique opportunity to reassess where your money is parked and possibly guarantee income like never before.

Alex adds to the...

Today we are covering retirement planning for business owners during and after the sale of their business.  Bruce Hosler and Alex Koury are both Certified Exit Planning Advisors (CEPA®), and our conversation revolves around ensuring business owners have enough funds to retire comfortably after selling their business. This is a significant concern since many owners have their wealth tied up in their businesses.

Bruce shares a success story about clients who, after 40 years in business, sold their land for a substantial sum, adding a comfortable cushion to their already solid retirement plan. This story highlights the importance of...

Today,  Bruce and Jason Hosler of Hosler Wealth Management dive into the complexities of exit planning and tax issues related to selling a business. We kick off discussing the importance of understanding a business's structure when preparing for a sale. The structure, whether it's a sole proprietorship, partnership, LLC, S-corporation, or C-corporation, significantly impacts tax implications. We note that some business owners even change their structure before a sale for better tax treatment.

There are differences between selling business assets and selling stock. Selling assets involves transferring individual business components, while selling stock means transferring ownership of t...

Today we have a comprehensive discussion with Bruce Hosler and Alex Koury of Hosler Wealth Management about the market outlook for 2024. We're now into a Presidential election year, and Alex addresses the common concern about the impact of presidential elections on market performance. Historically, the market has averaged an 11.6% return during election years, regardless of the winning party. This trend suggests that the political landscape may not be as influential on market performance as often perceived.

But Bruce cautions against expecting a smooth market ride in 2024, despite the historical data. He highlights the unpredictability of the market...

Today, Bruce and Jason Hosler delve into the financial landscape of 2024, focusing on the pivotal role of interest rates, the ongoing impact of inflation, and the potential influence of the presidential election on the economy.

The Federal Reserve had significant influence on the financial events of 2023, particularly through historic rate increases and a subsequent pause. We collectively foresee this trend continuing to shape the markets in 2024. We recognize that the market's recent fluctuations are largely a result of the COVID-19 pandemic and the government's response, which included aggressive measures to combat rising inflation.

We explore...

Today, Bruce Hosler and Jon Gay dive into the financial realities of the United States, focusing on the website USDebtClock.org. This website offers real-time data on national finances, including our ever-increasing national debt. As of this podcast, the U.S. national debt is at about $33.7 trillion, a steep increase from $27 trillion just three years ago.

We also discuss the significance of debt-to-GDP ratio. Currently, the U.S. debt-to-GDP ratio stands at an alarming 124.42%, which is far higher than it has been in past years. This ratio is concerning for several reasons, especially considering that federal spending...

Today, Bruce and Alex Koury talk about the S&P 500's present situation and potential future growth, emphasizing the role that specific stocks and more general investment strategies play in these turbulent times.

Alex begins by outlining the S&P 500's incredible 2023 performance, powered mainly by seven stocks—dubbed the 'Magnificent 7.'   These are IT behemoths like Apple, Amazon, Meta, Google, Microsoft, NVIDIA, and Tesla, who together accounted for 80% of the index's returns. At the same time, the 493 stocks that were left were essentially unchanged. This concentration calls into question the durability of such growth and the poss...

Bruce and Jason Hosler discuss the Corporate Transparency Act (CTA) implications for small business owners. The CTA, a new regulation set by the Treasury Department's lesser-known division, The Financial Crimes Enforcement Network (FinCEN), mandates that most small businesses disclose comprehensive information about their beneficial owners. This mandate includes personal and contact details, requiring a new application process starting January 1st, 2024.

Bruce elaborates on the Beneficial Ownership Information (BOI) regulations, which define a beneficial owner as anyone who either directly or indirectly exercises substantial control over a company or owns at least 25% of its shares. For sole member...

In this episode of the "Protecting and Preserving Wealth" podcast, host Bruce Hosler and Jon Gay dive deep into the Buckets of Money strategy for retirement income. Amidst a backdrop of stock market volatility, geopolitical tensions, and inflation, Bruce presents the Buckets of Money strategy as a safeguard against Sequence of Return Risk—a serious risk retirees face when market downturns coincide with the early years of retirement.

Bruce breaks down the strategy into four distinct "buckets," each designed for a different period of one's retirement. The first bucket covers years 1-5 and is heavily oriented towards co...

In this episode of the Protecting and Preserving Wealth Podcast, Jon Gay and Bruce Hosler discuss the importance of early financial lessons and their lasting impact. Bruce begins client relationships by asking them clients about their childhood money experiences, highlighting how these early lessons shape our financial behaviors.

Today, we explore how different family dynamics influence financial attitudes. Some families openly discuss money, while others keep it private. Jon shares his middle-class upbringing and how it influenced his budgeting approach, with his wife taking on a key financial role.

Bruce, drawing from his experience as...

In this episode of the Protecting and Preserving Wealth Podcast, host Bruce Hosler and Jon dive into the crucial topic of why having a will is only a partial estate plan - exploring the significance of beneficiary forms and their power in estate planning.

We begin by explaining the importance of beneficiary forms, emphasizing that they can override the instructions in your will or trust. Bruce highlights the various types of accounts that require beneficiary forms, such as 401(k)s, pension plans, IRAs, annuities, and life insurance policies.

You will hear Bruce cover the concept...

Today, Jon Gay, Bruce Hosler, and Jason Hosler from Hosler Wealth Management discuss various aspects of Social Security benefits and switching strategies. They start by explaining the concept of switching benefits, which allows individuals to switch to a new benefit when they become entitled, especially if it is higher than their current benefit. 

They emphasize that the Social Security Administration doesn't always notify people about switching opportunities, so individuals may not be aware of higher benefits available to them. You will hear an example of an expert who received a misleading letter from the Social Security Administration, h...

Today, Bruce and Jon are joined by Alex Koury, a wealth advisor with Hosler Wealth Management from the Scottsdale office, speaking about Estate Planning in this episode.  

We delve into the critical topic of estate planning in a clear and straightforward manner.  Bruce begins by emphasizing the essential role of a Will, especially for parents with minor children.  A Will determines who will care for the kids in unforeseen circumstances, avoiding potential family disputes.

The conversation then shifts to the significance of beneficiary designations.  These designations play a pivotal role in asset distribution, particularly for acco...

In this episode of "Protecting and Preserving Wealth," Bruce and Jon dive into a comprehensive discussion about the intricacies and nuances of 529 plans. These plans, designed to aid in saving for educational expenses, offer a range of benefits that extend beyond traditional college savings.

We highlight the potential tax advantages of 529 plans, one of which is an appealing opportunity for grandparents and parents to contribute and receive a tax deduction.  

Additionally, distributions are tax and penalty-free for qualified educational expenses. The discussion delves into the array of expenses that qualify for these distributions, including college-related c...

In this episode of "Protecting and Preserving Wealth," Bruce and Jon discuss a counterintuitive approach: discontinuing contributions to traditional IRAs and 401ks. Drawing insights from IRA distribution expert Ed Slott, I challenge established retirement planning conventions. Slott is a recognized authority in IRA planning, is a professional speaker, best-selling author, and well-regarded by The Wall Street Journal and USA Today.
 

Slott's premise questions the conventional advice of maximizing contributions to tax-deferred accounts. His article in Investment News presents an alternative perspective, suggesting that lower retirement tax rates are not guaranteed. Instead, he argues that deferred withdrawals c...

Many of our listeners have established a trust for their assets upon passing. And while nobody wants to think about their mortality, today I explain what happens to that trust when you pass.

The first thing that happens is that your living revocable trust becomes an irrevocable trust, and your successor trustee is now in charge of it. Also, the trust will need its own tax ID number and have a return filed for it and any of its income for as long as the trust remains intact. In the event of the passing of a spouse...

It's a question many taxpayers ask themselves each year.  Should I itemize my deductions, or should I take the standard?  Of course, every situation is different.  But today, I break down some factors that can affect this decision.

Since the Tax Cuts and Jobs Act (TCJA) of 2017, there are six main areas where you can claim itemized deductions.  Today, I will focus on four:

Medical and Dental - The catch here is that federally, only expenses exceeding 7.5% of your AGI can be deducted.  In other...

Congress has passed the SECURE Act 2.0. Among the many retirement plan changes are new catch-up contribution requirements. Alex Koury from Hosler Wealth Management joins Bruce today to explain.

As you may know, employees aged 50 and over can make "catch-up" contributions to their plans to save more for retirement. Until 2023, these additional contributions could go into the tax-deferred side of a 401(k) plan and be taken as a tax deduction.

However, beginning in 2024, highly compensated individuals' catch-up contributions may only go into Roth or after-tax plans. Now, the benefit to the retiree is that money will...