|On behalf of the entire Abich Financial family, we wish you a wonderful Merry Christmas, holiday season and Happy Early New Year! 2022 has flown by, and we have so much to be grateful for. Here at Abich Financial, we’re grateful for so much, but most importantly our clients. We exist because of you. It’s our company mission to help people retire with dignity and confidence. Thank you for your continued business, trust in us, and friendship. We take it seriously and we plan to continue to earn it every time we speak with you.
With the end of the year approaching, we wanted to remind you of a few things to think about as we head into 2023.
Roth Conversions: On 1/1/2026 the current tax code is scheduled to revert back to the prior tax code where tax brackets and rates were higher. With that in mind, it may make sense, after having run the projections, to consider shifting pre-taxed dollars into post-taxed dollars. There are several things to consider when doing this, so we encourage not trying to do it on your own.
Maxing out 401K’s/TSP’s/IRA’s: If your cash flow allows for it, we encourage maxing out company retirement plans and IRA’s where it makes sense and is allowed. Any extra savings that can put away before full retirement growing tax deferred and compounding can be of help.
RMD’s: If you have turned 72 in 2022 or are 72 and older and you have a 401K, TSP, 403B, 457, Traditional IRA, SEP IRA, etc, you have required minimum distributions that are due and have to be withdrawn in most cases by 12/31/2022. An exception to this rule would be if you’ve turned 72 this year, you actually have until April 1st of 2023 to withdraw 2022’s RMD, but you would have 2022 and 2023 RMD due next year together. Another exception would be that if you are still working at 72 and beyond and have money in your current employer’s 401K/TSP, etc, you do not have an RMD due from that specific plan, but you do have RMDs due from any other 401K or IRA. There is a 50% penalty on any RMD amount that was supposed to be withdrawn but wasn’t.
Estimated Tax Payments: Even in a down year, for those of you with brokerage accounts, (non-IRA accounts), you may incur phantom income, dividends, and capital gains. Estimated tax payments throughout the year can be helpful to stay on top of any tax liability due. If you are a client and have not had a review in a while, reply to this email or call our office at (571) 577-9968 to schedule a time to speak. If you are not a client and you don’t have a comprehensive Phase 2 retirement plan and roadmap built for you, reply to this email or call us at (571) 577-9968 to schedule your complimentary 2nd opinion and Where Do I Stand Plan.
As always, any and all questions are welcomed. We are here for you.