On March 27th, the President signed into law the Coronavirus Aid, Relief, and Economic Security Act (CARES Act).  The CARES Act is aimed at providing financial relief for the economic downturn caused by the Coronavirus pandemic.  I wanted to share some of the highlights of the 880 page CARES Act that will directly impact most of you reading this blog post.  
  
Assistance for American Workers, Families, and Businesses

All U.S. residents with adjusted gross income up to $75,000 ($150,000 married), who are not a dependent of another taxpayer and have a work eligible social security number, are eligible for a full $1,200 “rebate,” $2,400 married. In addition, they are eligible for an additional $500 per child. This is true even for those who have no income, as well as those whose income comes entirely from non-taxable means-tested benefit programs, such as SSI benefits. Estates and trusts are not eligible for this rebate. The rebates are being treated as advance refunds of a 2020 tax credit and taxpayers will reduce the amount of the credit available on their 2020 tax return by the amount of the advance refund payment they receive. 
For the vast majority of Americans, no action on their part will be required in order to receive a rebate check as the IRS will use a taxpayer’s 2019 tax return if filed, or in the alternative their 2018 return. This includes many low-income individuals who file a tax return in order to take advantage of the refundable Earned Income Tax Credit and Child Tax Credit. 
The rebate amount is reduced by $5 for each $100 that a taxpayer’s income exceeds the phase-out threshold. The amount is completely phased-out for single filers with incomes exceeding $99,000, $146,500 for head of household filers with one child, and $198,000 for joint filers with no children. 

Retirement Plan Provisions

IRA Contribution Deadline

The deadline for filing an individual’s 2019 income tax return is extended to July 15, 2020. In an FAQ, the IRS stated “Contributions can be made to your IRA, for a particular year, at any time during the year or by the due date for filing your return for that year. Because the due date for filing Federal income tax returns has been postponed to July 15, the deadline for making contributions to your IRA for 2019 is also extended to July 15, 2020.” 

Withdrawals from Qualified Retirement Plans and IRAs, and Plan Loans
The CARES Act provides tax relief for retirement plan and IRA “coronavirus-related distributions” up to $100,000 taken by individuals on or after January 1, 2020 and before December 31, 2020. The CARES Act permits in-service distributions, provides an exception to the 10% early distribution penalty, exempts the distribution from the mandatory 20% withholding applicable to eligible rollover distributions, allows the individual to include income attributable to the distribution over a three-year period, and allows the for the recontribution of the distribution to a plan or IRA within three years. 
The CARES Act provides that for plan loans made during the 180-day period beginning on the date of enactment and December 31, 2020 the maximum loan amount is increased from $50,000 or 50% of the vested account balance to $100,000 or 100% of the vested account balance. The due date for any repayment on a loan is delayed for one year (normally five years). 
To be eligible for the withdrawal and loan relief, an individual must fall within one of the following categories: 

• • The individual is diagnosed with COVID-19 by a test approved by the Centers for Disease Control and Prevention; 
• • The individual’s spouse or dependent is diagnosed with COVID-19; or 
• • The individual experiences adverse financial consequences as a result of being quarantined, being furloughed or laid off or having work hours reduced due to COVID-19, being unable to work due to lack of child care due to COVID-19, closing or reducing hours of a business owned or operated by the individual due to COVID-19, or other factors as determined by the Secretary of the Treasury. 

Plan administrators may rely on an employee’s certification that the employee meets these requirements. 

Required Minimum Distributions RMDs

The CARES Act suspends RMDs for 2020.  If you have already taken your RMD for 2020 and you do not need the income you have the option of putting the RMD back into your IRA.
 
Unemployment Insurance Provisions

The Act creates a temporary Pandemic Unemployment Assistance program through December 31, 2020 to provide payment to “covered individuals” who are not traditionally eligible for unemployment benefits, such as self-employed individuals, independent contractors, and those who have limited work history because they were unable to work as a direct result of the coronavirus public health emergency. “Covered individuals” include those who are not eligible for regular unemployment benefits and provide self-certification that the individual is otherwise able to work but for: 

• being diagnosed with COVID-19 
• a member of the individual’s household has been diagnosed with COVID-19 

• the individual is providing care for a family member diagnosed with COVID-19 
• a child is unable to attend school because it is closed due to COVID-19 
• the individual is unable to get to work because of quarantine order or is self-quarantined based on health care provided advice 
• the individual quit his job as a direct result of COVID-19 
• the individual’s job is closed as a direct result of COVID-19, or 
• is self-employed, is seeking part-time employment, does not have sufficient work history, or otherwise would not qualify for regular unemployment or extended benefits under State or Federal law or pandemic emergency unemployment compensation. 

“Covered individuals” do not include individuals who have the ability to telework with pay (i.e., work from home) or who are receiving paid sick leave or other paid leave benefits. A person may receive benefits under the Pandemic Unemployment Assistance program for up to 39 weeks, which includes any week the person received regular pay or extended benefits under any federal or state program. 
The Act also provides an additional $600 per week to each recipient of unemployment insurance or Pandemic Unemployment Assistance for up to four months. There will also be an additional 13 weeks of unemployment benefits through December 31, 2020 to help those who remain unemployed after state unemployment benefits are no longer available. 

Here is the link to the PDF of the entire 880 page CARES Act: https://www.majorityleader.gov/sites/democraticwhip.house.gov/files/Senate%20Amendment%20to%20H.R.%20748_0.pdf

Investors tend to have expectations in retirement that may be unrealistic.  According to The Wall Street Journal, there are 9 myths that some investors believe will be true that if end up not happening can cause a retirement plan to completely fall apart.  These 9 myths are:

• Myth #1: “I’m going to work in retirement.”
• Myth #2: “My home is my safety net.”
• Myth #3: “I can live on 70% or 80% of my pre-retirement income.”
• Myth #4: “My taxes will go down in retirement.”
• Myth #5: “I’m comfortable with debt.”
• Myth #6: “My spouse is taking care of everything.”
• Myth #7: “I’m going to get an inheritance.”
• Myth #8: “I’m going to get a pension—and it’s safe.”
• Myth #9: “I won’t need long-term care.” 

​Investors want to believe these myths will be true so they can have the retirement they really want.  It is our job and fiduciary duty at The Legacy Council to analyze our clients' real needs and wants for retirement and show them a realistic plan for their future.  Call us at (513) 442-2000 for your complimentary retirement analysis today!  

A “rollover” is a term for transferring tax-deferred retirement savings like a 401k or pension plan from one account to another.  If it is done correctly, a rollover can go a long way to helping deliver peace of mind and a safer, more secure retirement future.

You do not have to be held captive by your 401k or pension fund.  You have options.

If you are 59 ½ or have left your employer, you owe it to yourself to look into your 401k rollover options, especially if you are nearing retirement and looking to generate guaranteed lifetime income.  Money held in a 401k is vulnerable to stock market loss, and it is also typically heavily weighted with your company’s stock which exposes you to unnecessary risk.  This is especially true in a company pension plan.

We can help rollover your 401k or company pension to help you:

• Enjoy portfolio growth with zero downside risk
• Implement a smart retirement income solution with income you can’t outlive
• Maximize your retirement paycheck with the highest payout rates available

Can anyone do a 401k rollover?  No, you must either be 59 ½ years old or older or have left your place of employment.

What if I have a pension?  If you have a pension fund, you may be able initiate a rollover as soon as you turn 59 ½ years old or when you’ve left the employer. Other employers require you to wait until you leave the company regardless of age.  We can help you navigate your company’s plan rules to see if you are rollover eligible.

How hard is it to do a rollover?  It’s not difficult. There are four basic things you need to do:
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1. Gather up your latest statement.  This shows the amount you have saved along with how much you and your employer (if they offer a company match) have contributed.
2. Decide what you will roll it into. Contact the retirement experts at The Legacy Council to explore your options. It may make sense to roll over your funds into an income-generating product like a fixed index annuity.
3. Set up a new account.   We can assist with any paperwork to make the transition as smooth as possible.
4. Initiate the rollover.  Once all the paperwork is complete, simply specify that you want your funds transferred directly from the old account to the new account.

What’s the catch?  The main “catch” is making sure you do your rollover right.  Having the funds directly transferred (a “direct rollover”) from your old account to your new account without ever touching the money yourself is typically the best solution.  If you have the check made out directly to you, you can face stiff IRS penalties unless you redeposit the fund in a qualified plan within 60 days.  There are restrictions on 60-day rollovers you need to know and the forms can be confusing so be sure to contact us today.  We’d be happy to walk you through the entire rollover process.

Can I buy an annuity with my 401k or pension fund?  Yes. You can rollover your 401k or a lump sum from a pension into an annuity without paying taxes (if done correctly).  Annuities funded with these retirement savings plans are considered “qualified”, where the insurance company will create an “IRA annuity” allowing you to directly deposit your funds.

Your customized 401k/pension plan rollover solution is just one step away!  Call the Retirement Advisors at The Legacy Council today at (513) 442-2000.

As most people collecting Social Security payments already know, there is no Cost-of-Living Adjustment (COLA) in 2016.  The reason for this is because according to our government there was no increase in the Consumer Price Index (CPI-W) from the previous year.  Over the past several months I have certainly had the opportunity to hear my clients voicing their opinions about this topic.  

What I'm also finding in my client meetings is that most Americans don't know another big change to Social Security is coming in 2016.  Due to the most recent budget bill that was passed one of the big changes to filing for Social Security is the elimination of the "File and Suspend" strategy that many retirees have used in the past.  

This filing strategy allowed the spouse who reached full retirement age (currently 66) to file for Social Security and then immediately suspend the benefits. Their husband or wife could claim a spousal benefit while their deferred Social Security grew 8 percent per year until age 70.  

After May 1, 2016 a person must file for Social Security and actually receive benefits in order for a husband or wife to get a spousal benefit.  Those who are at least 66 or who will turn 66 by April 30, 2016 still have an opportunity to get in under the old file-and-suspend system and will be grandfathered in.  

If you have any questions about this change or any other aspects of filing for Social Security Benefits, call the experts at The Legacy Council at (513) 442-2000.

If you are on Medicare, you've probably heard of the time of year known as the Medicare Open Enrollment Period (OEP) or the Annual Election Period (AEP).  This is the time of year between October 15th and December 7th where you can look at your Medicare plan options and decide to stay on your current Medicare Advantage or Prescription Drug plan or switch to another plan.  

Note:  if you are on a Medicare Supplement plan you are able to switch to another Supplement any time throughout the year but you do have to go through Medical Underwriting. 

Typically the Insurance Companies will send out their Annual Notice of Changes (ANOC) towards the middle of September.  This lengthy document explains the details of your plan's benefits for the upcoming year beginning January 1st.   You must read the ANOC in it's entirety to make sure there are no surprises with your plan.  The main benefits you want to make sure you look at are:

• Monthly Premium
• Deductibles
• Copays
• RX Cost
  
• RX Formulary
• Provider Network

If you are happy with the changes (or lack thereof) and want to stay on your current plan, you don't have to do anything.  Your current plan will automatically renew for the following year and you will receive a new ID card in the mail.  The new card should arrive sometime in December and go effective January 1st.  

If for any reason you are unhappy with your plan's benefits for the upcoming year, the Open Enrollment Period is the time where you can "shop around" to see what else is available in your area.  You will undoubtedly be seeing product offers from all types of companies through the the mail, TV, internet and other media outlets.  You will likely feel overwhelmed with all the information.  This is a great time to contact your Local Brokers at The Legacy Council to help you sort out and navigate all the different plans and information.  The TLC licensed experts spend many hours each year certifying with all the different insurance companies to be able to offer expert advice to our clients.  Based on your specific situation we can help you find the plan that best suits your individual needs.  Since we represent most Major Carriers in the area we can provide a non-biased consultation on all the different plans available to you.  

If you don't currently work with a broker, The Legacy Council would be happy to help by providing a no-obligation meeting during the Open Enrollment Period or any time throughout the year.  Just give us a call at (513) 442-2000.  We'd love to welcome you into our TLC family as one of our valued clients.  

When it comes to Social Security most people understand how they pay into the system but aren't as educated on the Retirement Benefits of the program.  I compiled a list of 5 important facts regarding Social Security Retirement Benefits that will help people decide how to plan and manage their Social Security Benefits when it's time to retire.  

1.)  Your full retirement age is based on the year you were born.  If you were born between the years 1943 and 1954, your full retirement age is 66.  If you were born in 1960 or later, the full retirement age is 67.  The full retirement age increases gradually (between age 66 and 67) for anyone born between the years 1955 and 1959.

2.)  Every year you wait to begin collecting Social Security benefits will increase your benefit amount by approximately 8% per year up to the age of 70.  The benefit amount is locked-in once you begin collecting but can adjust each year with the cost of living increase (COLA).  

3.)  If your spouse dies, you will not receive both yours and your spouse's benefits.  You will receive the greater of the 2 benefits, but not both.  

4.)  You are able to work and also collect Social Security benefits but if you have not reached full retirement age your earnings will be subject to what is known as the retirement earnings test.  If your income surpasses the test limit, Social Security may withhold all or a portion of your benefits.  ***The benefits that are withheld will be repaid over your lifetime once you do reach full retirement age.  

5.)  Your spouse can qualify for Social Security benefits even if he or she has no earnings story.  This is known as the Social Security Spousal Benefit which may be as much as 50% of the higher earning spouse's full retirement age benefit.  The exact percentage is based on whether each spouse has reached full retirement age.  

For answers to other important questions regarding Social Security or with help planning your Social Security Retirement Benefits, please contact the licensed experts at The Legacy Council at (513) 442-2000.  

Do you have money invested in the stock market and worry whether it will go up or down...sometimes making it hard to sleep at night?  Are you always checking your retirement or investment accounts wondering what will happen next?  Since the 2008 market crash the market has been on an incredible bull run, however in the past 30 days the Dow Jones stock market index has decreased from 18,312 points to its present value hovering around 17,800. 

Many financial experts are estimating this is the year the incredible bull run ends and the market begins to correct itself with sharp declines.  Some market analysts are saying the stock market will crash worse than the crash of 2008. Are they correct?  Who knows?  The only thing we know for sure is that NO ONE EVER KNOWS what the market will do in the future.  Wouldn't it be nice to relax knowing that your retirement and investment accounts can never decrease in a market crash but have the ability to increase based on how a stock market index does? 

The Legacy Council offers financial products that do just that.  These products provide the peace of mind knowing that your principal can never decrease in a market decline but will gain interest when the market goes up.  The interest is tax-deferred and when it is time to retire these products can create a GUARANTEED LIFETIME INCOME that you can never outlive.  Knowing that you will never outlive your money in retirement, now that is "Peace of Mind."  Give us a call at (513) 442-2000 for details.

According to the American Cancer Society, the 5 year survival rate for all types of cancer is 68%.  The American Heart Association reports survival rates for heart attack & stroke have improved significantly with deaths due to cardiovascular disease falling by almost 33% and stroke by almost 37%.  

So what do these #'s and trends mean?  There is a very good chance that if you or a loved one suffers from cancer, heart attack or stroke there will be a cost of survival that needs to be addressed.  The medical bills will hopefully be mostly covered by a Major Medical insurance policy but what about the other costs associated with a diagnosis?  

These costs include:

• Replacing lost income while unable to work
• Paying health insurance deductibles & copay
• Hiring home health care or child care services
• Keeping up with monthly expenses like mortgage, utilities & groceries
• Traveling to receive treatment

***According to the Centers for Disease Control & Prevention, the economic burden for survivors is substantial.  Here is what they found:

So how can Cancer and Heart Attack/Stroke insurance help?  It's simple.  The policy owner receives a LUMP-SUM CASH PAYMENT between $10,000 and $50,000 upon diagnosis.  The money can be used any way he/she chooses.  This type of policy provides cash when it's needed most.  Instead of worrying about how to pay the bills, you or your family member can focus on getting better!  

For more details please call the Licensed Experts at The Legacy Council at (513) 442-2000.  

When most people think of Life Insurance they think of a product that pays a lump sum death benefit tax-free to a beneficiary upon the policy owner's death.  While this is true, it is only part of what a Life Insurance policy can provide.  There are many types of Life Insurance products, and one in particular that is growing in popularity for its Retirement Planning benefits is what is known as an Indexed Universal Life policy (IUL).  

I personally have an IUL and added it to my portfolio many years ago for several reasons.    The first is the policy allows for an instant Death Benefit from day one creating an instant "Estate" for one's heirs.  This is typical with all types of Life Insurance policies but with an IUL the policy owner has the ability to "overfund" the policy by paying more than the monthly premium (cost of insurance) every month which builds cash value within the policy that can grow tax-free over time.  

This is where an IUL gets exciting!  The cash value gains interest based on the growth of a stock index (such as the S&P 500) and the interest earned is locked-in each year allowing for protection from market volatility.  The cash value is never actually invested in the stock market but grows based on how the stock index performs.  Once the cash value has accumulated over time and the policy owner needs additional income for Retirement, the policy owner has the ability to take out what is called a Policy Loan from the cash value.  Since this loan is not a withdraw, the funds are not reported to the IRS, creating a Tax-Free stream of income during Retirement.  

There are many other features to an IUL and some of these features can be complicated so make sure to contact one of the Licensed Experts at The Legacy Council at (513) 442-2000.

Almost everyone has experienced or knows someone who has experienced a cancer diagnosis either themselves or in their family.  I have personally experienced this in my family within the past 6 months.  Even with excellent health insurance or Medicare coverage, cancer sufferers can still be hit with unexpected medical and non-medical expenses.  Alternative cancer treatments are becoming more and more popular due to their effectiveness but unfortunately are not covered by insurance and must be paid for 100% out of pocket.  Indirect costs of cancer due to loss of employment can greatly impact the ability to pay monthly bills, insurance deductibles, copays, etc all increasing the burden of the family.  

First Diagnosis Cancer Insurance provides a lump-sum cash benefit when an individual is first diagnosed with cancer.  A low monthly payment can provide up to $25,000 in cash that is paid right away upon diagnosis.  The policy will remain in force as long as premiums are paid and can even offer inflation protection.  The cash can be used for medical bills, debt, house payments, etc providing peace of mind knowing the financial burden of the individual being treated and the family will be less.