A mutual friend with a new dog brought Stephen and Katie together. Stephen had headed to his friend’s house to meet the new furry member of the family, and when he got there, he saw Katie playing with dog in the backyard. “Katie was so outgoing,” says Stephen. “She was the nicest person you’ll ever meet.”
That first meeting led to beach outings and concerts, and over time to getting married and thinking about starting a family. It was Katie who suggested they get life insurance. Stephen admits he wasn’t too happy about the idea. They were young and healthy, so he didn’t see the point. Katie, however, convinced him to sit down with insurance professional Rose Goheen, who walked them through the process and presented them with affordable options.
When the couple welcomed Chase, they decided to reevaluate their life insurance. Given their expanding family and responsibilities, they both bought additional life insurance.
It was during her recovery from giving birth to Reid that Katie realized something was wrong. Her doctor confirmed her suspicion that the abdominal lump she felt was something much more serious. In fact, it was an aggressive form of cancer. Katie, with the love and support of her family, valiantly fought the disease, but just over a year later it claimed this young mom’s life.
She was just 30.
No words can capture the devastation that Stephen and his boys felt at Katie’s loss. “It’s horrible to lose your soul mate and best friend,” he says. “But I have two boys to support, and I want them to know their dad can carry on.”
Life insurance has helped with that process.
“Nothing can bring Katie back, but having life insurance meant we didn’t lose everything,” he says. “I don’t earn enough alone to afford living in our house. Life insurance has eased my financial worries on so many levels.”
Thinking back to that first meeting with Rose, Stephen says: “Katie was the smarter one. She knew to plan for the future—our future—with life insurance.”
Things you can do for your future as the year unfolds.
What financial, business, or life priorities do you need to address for the coming year? Now is an excellent time to think about the investing, saving, or budgeting methods you could employ toward specific objectives, from building your retirement fund to managing your taxes. You have plenty of choices. Here are a few ideas to consider:
Can you contribute more to your retirement plans this year? In 2021, the contribution limit for a Roth or traditional individual retirement account (IRA) is expected to remain at $6,000 ($7,000 for those making “catch-up” contributions). Your modified adjusted gross income (MAGI) may affect how much you can put into a Roth IRA. With a traditional IRA, you can contribute if you (or your spouse if filing jointly) have taxable compensation, but income limits are one factor in determining whether the contribution is tax-deductible.1
Remember, withdrawals from traditional IRAs are taxed as ordinary income, and if taken before age 59½, may be subject to a 10% federal income tax penalty starting again in 2021. Roth IRA distributions must meet a five-year holding requirement and occur after age 59½ to qualify for tax-exempt and penalty-free withdrawal. Tax-free and penalty-free withdrawals from Roth IRAs can also be taken under certain other circumstances, such as a result of the owner’s death.2
Keep in mind, this article is for informational purposes only, and not a replacement for real-life advice. Also, tax rules are constantly changing, and there is no guarantee that the tax landscape will remain the same in years ahead.
Make a charitable gift. You can claim the deduction on your tax return, provided you follow the Internal Review Service (I.R.S.) guidelines and itemize your deductions with Schedule A. The paper trail is important here. If you give cash, you should consider documenting it. Some contributions can be demonstrated by a bank record, payroll deduction record, credit card statement, or written communication from the charity with the date and amount. Incidentally, the I.R.S. does not equate a pledge with a donation. If you pledge $2,000 to a charity this year but only end up gifting $500, you can only deduct $500.3
These are hypothetical examples and are not a replacement for real-life advice. Make certain to consult your tax, legal, or accounting professional before modifying your record-keeping approach or your strategy for making charitable gifts.
See if you can take a home office deduction for your small business. If you are a small-business owner, you may want to investigate this. You may be able to write off expenses linked to the portion of your home used to conduct your business. Using your home office as a business expense involves a complex set of tax rules and regulations. Before moving forward, consider working with a professional who is familiar with home-based businesses.4
Open an HSA. A Health Savings Account (HSA) works a bit like your workplace retirement account. There are also some HSA rules and limitations to consider. You are limited to a $3,600 contribution for 2021 if you are single; $7,200 if you have a spouse or family. Those limits jump by a $1,000 “catch-up” limit for each person in the household over age 55.5
If you spend your HSA funds for non-medical expenses before age 65, you may be required to pay ordinary income tax as well as a 20% penalty. After age 65, you may be required to pay ordinary income taxes on HSA funds used for nonmedical expenses. HSA contributions are exempt from federal income tax; however, they are not exempt from state taxes in certain states.
Pay attention to asset location. Tax-efficient asset location is one factor that can be considered when creating an investment strategy.
Review your withholding status. Should it be adjusted due to any of the following factors?
* You tend to pay the federal or state government at the end of each year.
* You tend to get a federal tax refund each year.
* You recently married or divorced.
* You have a new job, and your earnings have been adjusted.
These are general guidelines and are not a replacement for real-life advice. Make certain to consult your tax, human resources, or accounting professional before modifying your withholding status.
Did you get married in 2020? If so, it may be an excellent time to consider reviewing the beneficiaries of your retirement accounts and other assets. The same goes for your insurance coverage. If you are preparing to have a new last name in 2021, you may want to get a new Social Security card. Additionally, retirement accounts may need to be revised or adjusted?
Are you coming home from active duty? If so, go ahead and check on the status of your credit and any tax and legal proceedings that might have been preempted by your orders.
Consider the tax impact of any upcoming transactions. Are you planning to sell any real estate this year? Are you starting a business? Might any commissions or bonuses come your way in 2021? Do you anticipate selling an investment that is held outside of a tax-deferred account?
If you are retired and in your seventies, remember your RMDs. In other words, Required Minimum Distributions (RMDs) from retirement accounts. Under the SECURE ACT, in most circumstances, once you reach age 72, you must begin taking RMDs from most types of these accounts.6
Vow to focus on your overall health and practice sound financial habits in 2021. And don’t be afraid to ask for help from professionals who understand your individual situation.
This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.
Traci L. Kovacic is a registered representative of and offers securities through The O.N. Equity Sales Company, Member FINRA/SIPC, One Financial Way; Cincinnati, OH 45242; (513)794-6794
Riverfront Financial and The O.N. Equity Sales Company are unaffiliated companies
Why do so many people choose them over traditional IRAs?
Provided by Traci Kovacic
The IRA that changed the whole retirement savings perspective. Since the Roth IRA was introduced in 1998, its popularity has soared. It has become a fixture in many retirement planning strategies because it offers savers so many potential advantages.
The key argument for going Roth can be summed up in a sentence: Paying taxes on your retirement contributions today may be better than paying taxes on your retirement savings tomorrow.
Think about it. Would you rather pay taxes today or wait 10 years and see where the tax rates end up? With that in question in mind, here are some of the potential benefits associated with opening and contributing to a Roth IRA.
What you see is what you get. Roth IRA contributions are made with after-tax dollars, and any potential earnings on investments within a Roth IRA are NOT subject to income tax or included in the account owner’s income. Instead, they accumulate on a tax-deferred basis and are tax-free when withdrawn from the Roth if the distribution is qualified.1
You can arrange tax-free retirement income. Roth IRA earnings can be withdrawn tax-free as long as you are 59½ or older and have owned the account for at least 5 years. The IRS calls such tax-free withdrawals qualified distributions.2
Withdrawals don’t affect taxation of Social Security benefits. If your provisional income is between $25,000 and $34,000 — or $32,000 and $44,000 for joint filers — then your Social Security benefits may be taxed if you take withdrawals before your full retirement age. Luckily, a qualified distribution from a Roth IRA doesn’t count as taxable income, which may be a means of avoiding taxation on your social security benefit.3,4
You have until your tax-filing deadline to make a Roth IRA contribution for a given tax year. For example, IRA contributions for the 2020 tax year may be made up until April 15, 2021. While April 15 is the annual deadline, many IRA owners who make lump sum contributions for a given tax year make them as soon as that year begins, not in the following year. Making your Roth IRA contributions earlier gives the funds in the account more time to potentially grow. Remember, though that Roth IRA contributions cannot be made by taxpayers with high incomes. In 2020, the income phaseout limit was $139,000 for single filers and $206,000 for married couples who file jointly.5
Who can open a Roth IRA? Anyone with earned income (and that includes a minor).
How much can you contribute to a Roth IRA annually? The combined annual contribution limit to all of your traditional and Roth IRAs is $6,000 for 2019 and 2020 ($7,000 if you’re age 50 or older), but income limits may reduce or eliminate your ability to contribute. To sweeten the deal even further, you can keep making annual Roth IRA contributions all your life.6
All this may have you thinking about opening up a Roth IRA. A chat with the financial professional you know and trust may help you evaluate whether a Roth IRA is right for you, given your particular tax situation and retirement horizon.
1-The Roth IRA offers tax deferral on any earnings in the account. Withdrawals from the account may be tax free, as long as they are considered qualified. Limitations and restrictions may apply. Withdrawals prior to age 59 ½ or prior to the account being opened for 5 years, whichever is later, may result in a 10% IRS penalty tax. Future tax laws can change at any time and may impact the benefits of Roth IRAs. Their tax treatment may change.
This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.
_________________________________________________________________________________ Traci L. Kovacic is a registered representative of and offers securities through The O.N. Equity Sales Company, Member FINRA/SIPC, One Financial Way; Cincinnati, OH 45242; (513)794-6794
Riverfront Financial and The O.N. Equity Sales Company are unaffiliated companies
Traditional Vs. Roth IRA Do you know the difference?
Provided by Traci Kovacic
Traditional Individual Retirement Accounts (IRA), which were created in 1974, are owned by roughly 33.2 million U.S. households. Roth IRAs, however, were created as part of the Taxpayer Relief Act in 1997, are owned by nearly 22.5 million households.1
Both are IRAs. And yet, each is quite different.
Know the limits. Up to certain limits, Traditional IRAs allow individuals to make tax-deductible contributions into the account. Distributions from traditional IRAs at retirement are taxed as ordinary income, and if taken before age 59½, may be subject to a 10-percent federal income tax penalty. Remember, under the SECURE Act, in most circumstances, once you reach age 72, you must begin taking required minimum distributions from a Traditional Individual Retirement Account (IRA). Additionally, you may continue to contribute to a Traditional IRA past age 70½, under the SECURE Act, as long as you meet the earned-income requirement.
Filing single. For singles, the maximum tax-deductible contribution starts shrinking once your modified adjusted gross income (MAGI) reaches $65,000. Singles with adjusted incomes of $75,000 and above are not eligible for a tax deduction.2
Filing jointly. For those who are married and filing jointly, things are a bit more complicated. If you or your spouse makes an IRA contribution that is covered by a workplace retirement plan, the deduction begins phasing out when your adjusted gross income is at $104,000, and it disappears at $124,000. However, if you do not have a workplace plan, but your spouse does (or vice versa), the 2020 limit starts at $196,000, and no tax deduction is allowed once the contributor’s income reaches $206,000.
Also, within certain limits, individuals can make contributions to a Roth IRA with after-tax dollars and then qualify for tax-free and penalty-free withdrawals at retirement. Roth IRA distributions must meet a five-year holding requirement and occur after age 59½.3
Income impacts total contributions. Like a traditional IRA, contributions to a Roth IRA are limited based on income. For 2020, contributions to a Roth IRA are phased out between $196,000 and $206,000 for married couples filing jointly and between $124,000 and $139,000 for single filers.
Contribution limits. In addition to distribution rules, there are limits on how much can be contributed each year to either IRA. In fact, these limits apply to any combination of IRAs; that is, workers cannot put more than $6,000 per year into their Roth and traditional IRAs, combined. So, if a worker contributed $3,500 in a given year into a traditional IRA, their contributions to a Roth IRA would be limited to $2,500 during that same year.4
Catch-up contributions. Individuals who reach age 50 or older by the end of the tax year can qualify for “catch-up” contributions. The combined limit for these is $7,000.5
Let’s chat. When it comes to picking an IRA, both traditional and Roth IRAs may play an important role in your retirement strategy. If you have any questions, let’s chat soon about how these products may be a good fit for your goals.
This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.
_________________________________________________________________________________ Traci L. Kovacic is a registered representative of and offers securities through The O.N. Equity Sales Company, Member FINRA/SIPC, One Financial Way; Cincinnati, OH 45242; (513)794-6794
Riverfront Financial and The O.N. Equity Sales Company are unaffiliated companies
The customer experience is one of the keys to business success. In some industries, it can mean the difference between success and failure.
According to recent research by a major credit card issuer, 90% of Americans consider quality of customer service as they decide whether they want to do business with a company. Another study, conducted by a major business software manufacturer, notes that 93% of customers who get great service from a business are likely to come back and buy again.1
Still, great service remains rare. Customers who want help are often made to feel like they are inconveniencing a business. Some businesses disregard the customer experience, believing that consumers will buy largely on price or a trusted name, as if we were still in the era of dry goods stores and green stamp booklets.
Great customer service is about solving problems and meeting needs. The essentials are simply stated: a quick response, superior communication, putting the customer first. And yet, all this is often absent. As a first step to making these essentials the norm at your company, consider the following questions.
Is your business truly customer focused? Is it evolving in response to customer needs? Are you thinking of your customers and the employees in close contact with them when you think about your brand? Paradoxically, being a customer-focused business means focusing on the experiences of your employees as well as the people who purchase your products or services.
Your employees have to adopt the mindset that they are helpers, problem-solvers for a community of people. They come to work each day to “do good,” and they are the “experts” when it comes to this kind of help; they excel at responding to a specific need.
One of the keys to instilling this mindset is to communicate the values, purpose, and mission of your business. What role does your company play in people’s lives, in the community it serves? What kind of experience should your customers have? Your employees need to hear these things from you.
What kind of community are you creating? Think of your customers and workers as m
embers of the community created around your business. Ask your customers for their opinions of your products or services; involve them strongly in your brand’s evolution and direction. Doing the same with your workers not only gives them a say, but it is also a step toward becoming leaders themselves.
What degree of customer service can your employees deliver? Do they have the authority to give a dissatisfied customer a free product, a full refund, or a unique accommodation? If not, maybe they should be empowered with some of these options. They might just change that unhappy customer into a raving fan.
Are you constantly listening to your clients or customers? If you wonder how things might change in your industry, start by talking to the people who might want to see some change: the consumers. Gather steady feedback from your clients or customers to learn what they want and need now, as opposed to what they wanted and needed years ago when you opened your doors. What you learn may lead you to revise your business plan or direction, and the input will definitely refine the way that your company responds to your customers.
At Riverfront Financialwe pride ourselves in being 100% customer focused. Our goal is to work along side you for the long run, to help you achieve your current and future financial goals, and to make sure your family has the right protection with the right Life Insurance policies in place. Call us anytime to schedule a meeting, we are always here to help and answer any questions that you may have.
This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.
_________________________________________________________________________________ Traci L. Kovacic is a registered representative of and offers securities through The O.N. Equity Sales Company, Member FINRA/SIPC, One Financial Way; Cincinnati, OH 45242; (513)794-6794
Riverfront Financial and The O.N. Equity Sales Company are unaffiliated companies
In this week’s recap: Stocks continued a downward slide in response to continued uncertainty; fiscal stimulus still delayed.
September 14, 2020
THE WEEK ON WALL STREET
Stocks traveled a volatile path last week as investors appeared concerned about the upcoming elections, an uncertain economy, and more delays with additional fiscal stimulus.
The Dow Jones Industrial Average slid 1.66%, while the Standard & Poor’s 500 slumped 2.51%. The Nasdaq Composite index plummeted 4.06% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, rose 1.44%.1,2,3
Stocks Continue To Slip
In a holiday-shortened week of trading, stocks resumed their slide from the prior week, with the technology-heavy Nasdaq slipping into correction territory in a three-day span ended on Tuesday, September 8th. (A correction is defined as a decline of at least 10% from a recent high.)4
After staging a strong rebound on Wednesday, stocks once again headed lower as the Senate failed to pass another coronavirus stimulus bill. Mega-cap technology companies remained under pressure throughout the week. Energy stocks added to investors woes, plunging on data showing an unexpected build-up in inventories.5
The market ended the week on a mixed note, as technology companies lost additional ground.
Final Thought
On Friday the nation commemorated the tragic events of September 11, 2001.
We join all Americans in remembering the lives we lost that day and the profound impact on the victims’ families. We are reminded that it was the unity, kindness, and warmth that we collectively rediscovered in the wake of 9/11 that saw us through that difficult period.
T I P O F T H E W E E K:
Some companies match employee retirement plan contributions. So if your budget allows, contribute enough to qualify for the match.
THE WEEK AHEAD: KEY ECONOMIC DATA
Tuesday: Industrial Production.
Wednesday: Federal Open Market Committee (FOMC) Announcement.
Thursday: Jobless Claims. Housing Starts.
Friday: Leading Economic Indicators.
Source: Econoday, September 11, 2020
The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.
THE WEEK AHEAD: COMPANIES REPORTING EARNINGS
Tuesday: Adobe Systems (ADBE), Lennar Corporation (LEN), Fedex (FDX).
Source: Zacks, September 11, 2020
Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.
Q U O T E O F T H E W E E K
“Popularity: it is glory’s small change.”
VICTOR HUGO
T H E W E E K L Y R I D D L E
A plastic bottle filled with cola weighs one liter. What do you need to add to it to make it weigh less than two ounces?
LAST WEEK’S RIDDLE:
If it were two hours later than right now, it would be half as long until midnight as it would be if it were an hour later than right now. What time is it?
ANSWER: 9:00 PM.
Know someone who could use information like this? Please feel free to send us their contact information via phone or email. (Don’t worry – we’ll request their permission before adding them to our mailing list.)
Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost.
The forecasts or forward-looking statements are based on assumptions, may not materialize, and are subject to revision without notice.
The market indexes discussed are unmanaged, and generally, considered representative of their respective markets. Index performance is not indicative of the past performance of a particular investment. Indexes do not incur management fees, costs, and expenses. Individuals cannot directly invest in unmanaged indexes. Past performance does not guarantee future results.
The Dow Jones Industrial Average is an unmanaged index that is generally considered representative of large-capitalization companies on the U.S. stock market. Nasdaq Composite is an index of the common stocks and similar securities listed on the Nasdaq stock market and is considered a broad indicator of the performance of technology and growth companies. The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) and serves as a benchmark of the performance of major international equity markets, as represented by 21 major MSCI indexes from Europe, Australia, and Southeast Asia. The S&P 500 Composite Index is an unmanaged group of securities that are considered to be representative of the stock market in general.
U.S. Treasury Notes are guaranteed by the federal government as to the timely payment of principal and interest. However, if you sell a Treasury Note prior to maturity, it may be worth more or less than the original price paid. Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.
International investments carry additional risks, which include differences in financial reporting standards, currency exchange rates, political risks unique to a specific country, foreign taxes and regulations, and the potential for illiquid markets. These factors may result in greater share price volatility.
Please consult your financial professional for additional information.
This content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG is not affiliated with the named representative, financial professional, Registered Investment Advisor, Broker-Dealer, nor state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information, and they should not be considered a solicitation for the purchase or sale of any security.
Copyright 2020 FMG Suite.
CITATIONS:
The Wall Street Journal, September 11, 2020
2. The Wall Street Journal, September 11, 2020
3. The Wall Street Journal, September 11, 2020
4. CNBC.com, September 8, 2020
5. CNBC.com, September 9, 2020
CHART CITATIONS:
The Wall Street Journal, September 11, 2020
The Wall Street Journal, September 11, 2020
treasury.gov, September 11, 2020
Traci L. Kovacic is a registered representative of and offers securities through The O.N. Equity Sales Company, Member FINRA/SIPC, One Financial Way; Cincinnati, OH 45242; (513)794-6794
Riverfront Financial and The O.N. Equity Sales Company are unaffiliated companies
Looking ahead can help you conquer these unique obstacles.
When it comes to retirement, some women face obstacles that can make saving for retirement a challenge. Women typically earn less than their male counterparts and often take time out of the workforce to care for children or other family members. Added to the fact that women typically live longer than men, retirement money for women may need to stretch even further.1 Despite these challenges, there are a lot of reasons to be hopeful.2
Review your existing situation. Do you want to spend your years traveling together, or do you envision staying closer to home? Are you seeing yourself moving to a retirement community, or do you want to live as independently as you can? Sit down with your spouse, if you’re married, to discuss your visions for retirement.
You can’t see if you’re on track for your goals if you haven’t defined them. And if you find you’re falling short of where you want to be, you can work together to strategize about how you can either get to where you want to go or to adjust your strategy so that it fits your existing situation.1
Get creative. These challenges don’t have to stop you from saving for retirement if you’re willing to get creative. If you plan to or have taken off time from the workforce, try and increase your contributions to your retirement accounts while you are working. If you’re staying home while your spouse works, you may be able to contribute to an individual retirement account.3
Under the SECURE Act, once you reach age 72, you must begin taking required minimum distributions from a Traditional Individual Retirement Account and other retirement plans in most circumstances. Withdrawals from Traditional IRAs are taxes as ordinary income and, if taken before age 59½, may be subject to a 10% federal income tax penalty. Under the CARES Act, the 10% penalty may be waived in 2020. Traditional IRA may be fully or partially deductible, depending on your adjusted gross income.
If you’re caregiving for an elderly relative, there are ways to be paid for your time. According to AARP, the Veteran’s Administration or Medicaid may be a potential source of income. Working with a professional who has expertise in this field can help you navigate the complicated medical structure while also helping you earn income for work that you’re doing.3
Get involved. One of the best things you can do is to get involved in conversations about finances. Many women undervalue their knowledge in this area and having regular conversations with your spouse, family, and financial professional can help ensure that you always know where things stand.3
While women may face additional challenges, careful preparation with your financial professional may help you to live a fulfilling retirement.
This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.
Traci L. Kovacic is a registered representative of and offers securities through The O.N. Equity Sales Company, Member FINRA/SIPC, One Financial Way; Cincinnati, OH 45242; (513)794-6794
Riverfront Financial and The O.N. Equity Sales Company are unaffiliated companies
How Much Do You Really Know About Extended and Eldercare?
Separating some eldercare facts from eldercare myths.
How much does eldercare cost, and how do you arrange it when it is needed? The average person might have difficulty answering those two questions, for the answers are not widely known. For clarification, here are some facts to dispel some myths.
True or false: Medicare will pay for your mom or dad’s nursing home care.
FALSE. Medicare is not extended care insurance.1
Medicare Part A will pay the bill for up to 20 days of skilled nursing facility (SNF) care, but after that, you or your parents may have to cover some costs out-of-pocket. After 100 days in a SNF, you will have to cover all costs out of pocket. The only way to “reset the clock” for Medicare coverage of these services is if the patient can somehow go without skilled nursing care for 30 or 60 days or if they require a hospital stay of three full days or longer.1
True or false: A semi-private room in a skilled nursing facility costs about $35,000 a year.
FALSE. The median cost of a semi-private room is now $89,297. A private room in an assisted living facility has a median annual cost of $100,375 annually. A home health aide could run you up to $4385 per month for full-time care. Even if you just need someone to help mom or dad with activities of daily living (ADLs), such as eating, bathing, or getting dressed, the median hourly expense is not cheap: non-medical home aides run about $23 per hour, which at 10 hours a week, means nearly $12,000 a year.2,3
True or false: Only around 40% of Americans aged 65 and older are expected to need extended care.
FALSE. Someone turning 65 today has a 70% chance of needing extended care. That means that by 2030, it’s estimated that around 24 million Americans will need extended care. This is double the current number already receiving care.4,5
True or false: The earlier you buy extended care insurance, the more manageable the premiums.
TRUE. Younger policyholders may pay lower premiums. The best time to consider extended care insurance is when you are healthy. While you may be paying a premium for a longer amount of time, the expense may pale in comparison to paying for unexpected medical costs out of pocket.6
True or false: Medicaid can pay nursing home costs.
TRUE. The question is, do you really want that to happen? While Medicaid rules vary by state, in most instances, a person may only qualify for Medicaid if they have no more than $2,000 in “countable” assets ($3,000 for a couple). A homeowner can even be disqualified from Medicaid for having too much home equity. A primary residence, a primary motor vehicle, personal property, and household items, burial funds of less than $1,500, and tiny life insurance policies (with face values of less than $1,500) are not countable. So, yes, under these economic circumstances, Medicaid may end up paying extended care expenses.7
A little strategizing now could make a big difference in the years to come. Call or email us today to learn more about ways to pay for extended care and discuss your choices. You may need to find a way to address this concern.
Traci L. Kovacic is a registered representative of and offers securities through The O.N. Equity Sales Company, Member FINRA/SIPC, One Financial Way; Cincinnati, OH 45242; (513)794-6794
Riverfront Financial and The O.N. Equity Sales Company are unaffiliated companies
Citations
Medicare.gov, March 26, 2020
SeniorLiving.org, June 24, 2020
APlaceForMom.com, May 11, 2020
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September is National Life Insurance Awareness Month, so it’s a great time to review your coverage.
If you don’t have any life insurance, you’re not alone. Life insurance is one of those “someday” things for many people – but the cheapest time to buy it is probably today.
There are two kinds of life insurance: termand permanent. Additionally, there are three kinds of permanent life insurance: whole, universal, and variable.
How do these forms of life insurance differ, and how do you find out which type of coverage is right for you?
The way to find out is to look at where you are in life, so that you can assess your current insurance needs. Have you reviewed your insurance lately? Don’t think you need life insurance? If so, consider the following potential factors that may make it a good idea:
*You have a spouse or partner
*You have children
*You have an aging parent or disabled relative who depends on you for support
*Your household depends heavily on your income
*Your retirement savings or pension won’t be enough for your spouse or partner to live on should you pass away
*You own a business, either solely or with partners
*You have a substantial joint financial obligation, such as a personal loan for which another person could be legally responsible after your death
In any of these circumstances, you may require life insurance. If you have coverage, changes in your life may demand an update.
The affordability of life insurance may surprise you. Many people think it is expensive, and so often, it is not. The non-profit insurance education group Life Happens recently
conducted a study about this. More than half the millennial’s contacted for the study thought a $250,000 term life policy would cost $1,000 or more per year. The reality: the a
average annual premium is about $160.1
Life insurance is intended to help your loved ones financially after you die.
The proceeds from a life insurance policy may help your spouse, partner, or family members manage finances if they have to adjust to life without your income.
The death benefit may also be used to meet funeral costs and other final expenses, which may run into the tens of thousands of dollars.
Are you still unsure about buying life insurance, or do you suspect that your current insurance coverage needs to be updated?
Please contact us at (412) 837-2400 or Tkovacic@Riverfrontfin.com and we will be happy to assist you in evaluating all the factors and help you choose an appropriate policy.
Riverfront Financial awarded Best Insurance Agencies in Pittsburgh 2020
This material was prepared by MarketingPro, Inc for use by Traci Kovacic
Traci L. Kovacic is a registered representative of and offers securities through The O.N. Equity Sales Company, Member FINRA/SIPC, One Financial Way; Cincinnati, OH 45242; (513)794-6794
Riverfront Financial and The O.N. Equity Sales Company are unaffiliated companies
