Market Memo
June 9, 2023
Stocks Diverge, Yields Rise, & Artificial Intelligence Theme Gains Traction
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The financial journey through retirement is full of twists and turns, but one aspect that often surprises retirees is the high cost of medical expenses. At Perissos Private Wealth Management, we understand the crucial intersection between retirement income planning and medical costs. With the average retiree expected to spend around $5,000 per year on out-of-pocket medical expenses not covered by Medicare, and a projected total of $280,000 in today’s dollars throughout retirement, careful planning becomes paramount.
It’s essential to note that these figures do not include long-term care insurance or expenses. Proactive income planning helps prepare for these challenges and offers one of the biggest benefits of working with a retirement professional and having a well-structured retirement income plan.
At Perissos Private Wealth Management, we go beyond ensuring our clients have sufficient income during retirement; we also consider how income decisions and strategies may affect facets of retirement, including Medicare. For instance, unexpected medical costs may arise from IRMAA surcharges, which stand for “Income-Related Monthly Adjustment Amount.” Depending on income levels in retirement, IRMAA can substantially increase your Medicare premiums.
According to the 2018 Medicare Trustees Report, Part B premiums are expected to rise about 8% annually over the next five years. This increase, coupled with mandatory distributions from IRAs starting at age 72, can bump many retirees into higher IRMAA surcharge brackets, inadvertently increasing out-of-pocket medical costs.
Our Customized Retirement Plan at Perissos Private Wealth Management helps tailor your income and tax strategy with a focus on Medicare and related health care costs throughout retirement. This kind of in-depth planning and expertise is what sets us apart from our competitors. Let us guide you through this intricate journey to secure a financially stable and fulfilling retirement.
Stocks Diverge, Yields Rise, & Artificial Intelligence Theme Gains Traction
Naming a Charitable Remainder Unitrust (CRUT) or Charitable Remainder Annuity Trust (CRAT) as your IRA beneficiary offers significant tax benefits, supporting charities while providing income to beneficiaries. However, it involves asset loss control and complex setup, possibly conflicting with traditional inheritance goals. Consultation with professionals is advised for alignment with financial strategies.
Qualified Charitable Distributions (QCDs) from IRAs allow individuals 70.5 years or older to donate up to $100,000 tax-free directly to charities, providing financial and philanthropic benefits. This strategy satisfies Required Minimum Distributions, reduces taxable income, and potentially avoids Medicare surcharges, helping retirees optimize their financial planning and philanthropic impact. Tax laws are complex; consulting professionals is advised.
A 1031 Exchange into a Private Real Estate Fund allows investors to defer capital gains taxes from the sale of rental properties by reinvesting in like-kind properties or funds. This strategy, under Section 1031 of the U.S. Internal Revenue Code, aids in tax savings, offers portfolio diversification, and enhances potential income. By putting proceeds into professionally managed funds, investors can mitigate risks and improve returns without the immediate tax liability, making it an effective tool for wealth preservation in real estate investment.
5 Mistakes to Avoid When Filing for Medicare Medicare, a federal health insurance program, is a crucial resource for individuals aged 65 and older, as
Avoid costly errors when filing for Social Security with this guide. Learn the top five mistakes people make, from filing too early or late, to misunderstanding spousal benefits. Gain the knowledge to navigate the complex system and maximize your benefits. Don’t leave your financial future to chance, avoid these common pitfalls.
Avoid common pitfalls in a Backdoor Roth Conversion to ensure success. These include not understanding the pro-rata rule, failing to wait for the five-year period, neglecting tax implications, overlooking income limits, and not keeping track of contributions. Avoid these mistakes to maximize your retirement savings and minimize tax liabilities.
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Investment advisory services are offered through Perissos Private Wealth Management, an Oklahoma-registered investment advisor. This site is published for residents of the United States only. Investment advisor representatives of Perissos Private Wealth Management may only conduct business with residents of the states and jurisdictions in which they are properly registered. Therefore, a response to a request for information may be delayed until appropriate registration is obtained or exemption from registration is determined. Not all the services referenced on this site are available in every state and through every advisor listed.