Speaker 1: Talking this week with our retirement planning professionals from Class Financial,
Speaker 1: Malia Quavis and Kyle Kite. If you've got a question
Speaker 1: for Millie and Kyle, love to have you join us
Speaker 1: this morn and tell number to get on the air
Speaker 1: six oh eight three two one thirteen ten. That's six
Speaker 1: oh eight three two one thirteen ten. We're going to
Speaker 1: be talking with Millie and Kyle will be talking.
Speaker 2: About rollovers this week.
Speaker 1: But if you have anything retirement related to any type
Speaker 1: of question, Malia and Kyle are here to answer your question.
Speaker 1: Telphonn ombver here at station to get on the air
Speaker 1: six oh eight three two one thirteen ten. That's six
Speaker 1: oh eight three two one thirteen ten. You can learn
Speaker 1: more about Class Financial on their website classfinancial dot com.
Speaker 1: That's Class k LaaS Financial dot com and their telephone
Speaker 1: number six oh eight four four two five six three seven.
Speaker 1: Don't forget no charge for that initial get to know
Speaker 1: you appointment Tech Loss Financial. It will be complementary to
Speaker 1: you again their number six oh eight four four two
Speaker 1: five six three seven joining us this morning. As mentioned
Speaker 1: Malia Quavis and Kyle Kite. Malia, how the heck have
Speaker 1: you ben my friend, very.
Speaker 3: Good, Happy spring.
Speaker 1: It's here, it is, it is. It looks like some
Speaker 1: great days ahead.
Speaker 2: Kyle. How have you been doing. It's been a while
Speaker 2: too talking with you.
Speaker 4: Doing good.
Speaker 2: It's good to talk with both of you.
Speaker 1: And as mentioned, we're going to be talking about retirement accounts, rollovers,
Speaker 1: maybe switching jobs or of course as you near retirement
Speaker 1: you really start to pay closer attention to these type
Speaker 1: of things. We'll talk about some of the stuff that
Speaker 1: you need to have in mind and need to be doing,
Speaker 1: some actions you need to be taking with our retirement
Speaker 1: planning professionals this morning, and just a moment, a couple
Speaker 1: of things mentioned the website COSS Financial dot com. Don't
Speaker 1: freak can listen back to this and previous shows podcasts
Speaker 1: all online at that website class financial dot com. That's
Speaker 1: coss k l aas financial dot com. You can also
Speaker 1: sign up for the weekly Market Pulse newsletter right online again.
Speaker 1: They're telephone number six so eight four four two five
Speaker 1: six three seven. Later on the show, we're going to
Speaker 1: be doing the Class Quiz question the week, another chance
Speaker 1: for you to win a fantastic prize. This week, our
Speaker 1: friends at Costs Financial have provided a twenty five five
Speaker 1: dollar gift card to ihop tell you a little bit
Speaker 1: later on in the program how you can win that
Speaker 1: little tipto. Oftentimes, just about every week, the question and
Speaker 1: answer come up during the program, and before we get
Speaker 1: rolling on this week's conversation, let's actually look back at
Speaker 1: last week's show, Malia and get the Claws quiz question
Speaker 1: and answer there as well.
Speaker 3: Yeah, so, one of our favorite topics around here is
Speaker 3: discussing Medicare. So last week's question was, according to Medicare
Speaker 3: dot gov, Medicare is a federal health insurance program in
Speaker 3: the United States for people. What age you're older? So
Speaker 3: his multiple choice was at age sixty two, sixty five,
Speaker 3: or sixty seven, and Pat called in with a correct answer.
Speaker 3: Congratulations to her. Medicare is available to you at the
Speaker 3: age of sixty five, So Sean, you cannot sign up yet. Okay,
Speaker 3: take note of that, But congratulations to Pat, and thanks
Speaker 3: everyone for listening and calling in for answering that question.
Speaker 2: It was a fantastic show as well. Good folks.
Speaker 1: If you want to listen back, you can always head
Speaker 1: on over to class financial dot com. That's class financial
Speaker 1: dot com. Somedays I feel sixty five or older.
Speaker 3: Moly, I don't know, we all do, we all do.
Speaker 2: I don't know if that counts for much, So of
Speaker 2: course we might be.
Speaker 1: You know, as we talk about approaching retirement and switching jobs,
Speaker 1: I know a lot of folks reach out to you
Speaker 1: if they've got maybe an old retirement account to roll over,
Speaker 1: and Kyle, I got to ask, what should they know
Speaker 1: before making making any kind of moves.
Speaker 4: Yeah, it's a great question, Sean. So these jobs, it's
Speaker 4: very common that they leave behind an older timement plan,
Speaker 4: an old four and K or a four H three
Speaker 4: B something like that. So some of the stats around
Speaker 4: this are According to the Bureau of Labor Statistics, individuals
Speaker 4: between ages eighteen and fifty two may change jobs up
Speaker 4: to twelve times, and many of those jobs likely included
Speaker 4: an employer sponsored retirement planning like a four oh one K,
Speaker 4: four H three B simply er A or a set
Speaker 4: by RA. So it's very common that, you know, when
Speaker 4: you're switching jobs, sometimes these things you kind of forget
Speaker 4: about once while, and people will come and see us
Speaker 4: ten or fifteen years later and like, oh, yeah, I
Speaker 4: had all these old things out there that I forgot about.
Speaker 4: So if you have an old retirement account, it's important
Speaker 4: to understand your options before you may so many people
Speaker 4: choose to roll their funds into the new employer's plan,
Speaker 4: which allows for easier account management and avoids immediate taxes
Speaker 4: or penalties. But there's some other options that you have
Speaker 4: out there as well. So the first one, and the
Speaker 4: one that we probably recommend the least, would be to
Speaker 4: just cash out the four one K. So while it
Speaker 4: may seem tempty, to be careful here because there's some
Speaker 4: significant financial consequences, the big one being that the entire
Speaker 4: balance of what you cash out becomes taxabile income in
Speaker 4: the year that you withdraw it, and if you're under
Speaker 4: the age of fifty nine and a half, you'll likely
Speaker 4: face a ten percent early withdrawal penalty on top of
Speaker 4: federal and state tag and for many many people, you know,
Speaker 4: if you're under that age of fifty nine and a
Speaker 4: half and you cash this money out, you're going to
Speaker 4: lose you know, somewhere in that twenty to thirty percent
Speaker 4: range between the the penalty and the taxes on it.
Speaker 4: So one you know some options where this might work
Speaker 4: is if you only have a small balance, this might
Speaker 4: not be a big deal, So think of you know,
Speaker 4: one thousand, two thousand and three thousand dollars. It's not
Speaker 4: as big with the penalty and stuff like that. But
Speaker 4: if you've accumulated a lot of money inside that plan,
Speaker 4: adding that lump sum to your yearly income could push
Speaker 4: you into that higher tax bracket as well. So that's
Speaker 4: part of the reason why we say, you know, it's
Speaker 4: one of our least recommended options.
Speaker 1: I would say so talking this morning with Malia Kuavis
Speaker 1: and Kyle Kite, they are our retirement planning professionals from
Speaker 1: cost Financial. You can learn more online their website costs
Speaker 1: financial dot com. That's cost k l a a s
Speaker 1: financial dot com. Fantastic resource to learn more about the
Speaker 1: team at Costs Financial. You can learn about their separate divisions,
Speaker 1: how they can help you or if you're an employer
Speaker 1: as well. They've got a lot of information up on
Speaker 1: the website costs Financial dot com. There tell for number six,
Speaker 1: SOH eight four four two five, six three seven, don't
Speaker 1: forget no charge for that initial gets to know your
Speaker 1: appointment at Costs Financial. It will be complimentary to you.
Speaker 1: Again they're number six, SOH eight four four two five
Speaker 1: six three seven, and it joined us this morning with
Speaker 1: a question. Now I gotta do is pick up phone,
Speaker 1: give us call six eight three two one thirteen ten.
Speaker 1: That's six oh eight three two one thirteen ten. So, Kyle,
Speaker 1: as you talk about some of the penalties and some
Speaker 1: of the consequences of doing a four oh one K withdrawal,
Speaker 1: are there ways to kind of put the genie back
Speaker 1: in the bottle?
Speaker 2: Are there ways to reverse a four oh one K withdrawal?
Speaker 4: Yeah, so there is, Sean, but you got to be again,
Speaker 4: very very careful, and you got to do it quickly.
Speaker 4: So if you act fast, you might be able to
Speaker 4: undo one of these withdrawals. So this is called a
Speaker 4: which means redepositing the funds into a qualified retirement account
Speaker 4: within those sixty days. But you got to remember that generally,
Speaker 4: when you do a four oh one K cash out,
Speaker 4: they automatically withhold that twenty percent in taxes, so you're
Speaker 4: going to have to not only put the money back
Speaker 4: that they cashed out to you, but also make up
Speaker 4: those difference in taxes as well. And you can got
Speaker 4: to keep in mind that you can only do one
Speaker 4: rollover per year between those iras. So again these are
Speaker 4: a lot of the things that we have to be
Speaker 4: very very careful of, and again why we don't recommend
Speaker 4: this very often for people. So the next option would
Speaker 4: be to keep your four one K with your former employer.
Speaker 4: So again this is where people kind of just forget
Speaker 4: about it and leave it sit there or they don't
Speaker 4: take any action. Many come the funds in the plane
Speaker 4: and the money can continue to grow tax deferred. But
Speaker 4: it's getting more and more common that if your balance
Speaker 4: is under five thousand, your former employer may eventually ask
Speaker 4: you to move it. So they'll either push it into
Speaker 4: an IRA for you, or they'll keep you know, sending
Speaker 4: you emails or letters in the mail that they want
Speaker 4: you to move it. And while this option keeps it simple,
Speaker 4: there's a few drawbacks to this. So the first one
Speaker 4: is that you can't contribute to the account anymore, so
Speaker 4: you can't contribute to prior for to one k's, it'd
Speaker 4: only be current four to one k's or current iras
Speaker 4: that kind of stuff. And you'll need to monitor your
Speaker 4: investments to ensure that they align with your risk tolerance.
Speaker 4: So again, these things can change as you get a
Speaker 4: little bit older. Maybe you've left it there for twenty
Speaker 4: years and you're a different stage of life, and we
Speaker 4: need to tweak those investments that would be one hundred
Speaker 4: percent on you. And then most plans offer a limited
Speaker 4: selection of investment options, so your choices may be restricted.
Speaker 1: Aft because not too long ago, I received one of
Speaker 1: these letters from an employer that I worked at right
Speaker 1: out of high school. There's less than a thousand dollars,
Speaker 1: and I felt terrible because I'm like, boy, these poor
Speaker 1: people have been managing this all about it that I
Speaker 1: didn't even know existed. But yeah, it does. I guess
Speaker 1: that's probably quite common. What about we talk about some
Speaker 1: of the options. What about rolling over your four to
Speaker 1: one K into a new employer's plan.
Speaker 4: Yeah, as we mentioned earlier, this is probably one of
Speaker 4: the more common options for people. Most four one K
Speaker 4: plans will allow you to roll over old four to
Speaker 4: one ks into this new one. So this is a
Speaker 4: popular choice because it just consolidates things. And you've heard
Speaker 4: Au say it on the show many many times. We're
Speaker 4: big fans of consolidation, simplification, and diversification, right, So by
Speaker 4: consolidating this, it makes it easier to manage your retirement
Speaker 4: savings and better yet there you don't have to worry
Speaker 4: about paying taxes or anything like that. It's all tax free.
Speaker 4: It's not a taxable event, so you're good to go
Speaker 4: in that respect. And there's a couple of additional benefit
Speaker 4: fits when it comes to a four to one K.
Speaker 4: Number one is you've got the Aris of protections offering
Speaker 4: potential creditor protection. So remember this is where if you're
Speaker 4: if you are filing bankruptcy things like that, you have
Speaker 4: creditor protection for retirement accounts, but falls into those Arista
Speaker 4: guidelines of four to one ks, and your new four
Speaker 4: to one K maybe you move to a bigger company
Speaker 4: so they have better investment options or lower fees. This
Speaker 4: could be an efficient way to grow your savings. And finally,
Speaker 4: you want to be mindful of your pretext and WROTH
Speaker 4: balances because they do need to be rolled over properly
Speaker 4: into corresponding accounts. So going from a four to one K,
Speaker 4: a traditional four one K to a WROTH four O
Speaker 4: on and K that could be a taxable event. So
Speaker 4: you just got to be very very careful when you're
Speaker 4: looking at these things.
Speaker 1: Really important stuff to know their As we talked this
Speaker 1: morning with our retirement planning professionals from Class Financial, Kyle
Speaker 1: Kite and Malia Quavis. You can learn more about Costs
Speaker 1: Financial on their website coss Financial dot com. That's coss
Speaker 1: k l aas Financial dot com. They're telephone number six
Speaker 1: so eight four four two five six three seven. No
Speaker 1: charge for that initial get to know you appointment tech
Speaker 1: Costs Financial h we will be complimentary to you again.
Speaker 1: They're telephone number six so eight four four two five
Speaker 1: six three seven. You're saying, well, rolling it over a
Speaker 1: four oh one K into a new four oh one K.
Speaker 2: Is one thing.
Speaker 1: What about an IRA? We'll get the details on that.
Speaker 1: We'll do it next as Money in Motion with cost
Speaker 1: Financial continues right here on thirteen ten. WIBA join this
Speaker 1: week by Malia Quavis and Kyle Kite. They are our
Speaker 1: retirement binding professionals from COSS Financial. The website cossfinancial dot com.
Speaker 1: It's coss k l Aasfinancial dot com. Great resource to
Speaker 1: learn more about COSS Financial, how they can help you
Speaker 1: if you're an employer. Also, I'll learn how they can
Speaker 1: help you.
Speaker 2: Also.
Speaker 1: There's different divisions of COSS Financial. It's all really really
Speaker 1: nice on the website Colssfinancial dot com. While you're there,
Speaker 1: If you haven't signed up yet for the weekly Market
Speaker 1: Pulse newsletter, I strongly urge you to do that. I
Speaker 1: signed up probably ten years ago. It's a great it's
Speaker 1: not spam or anything like that. It's like once a
Speaker 1: week you'll get an email and it gives you a
Speaker 1: little snapshot of what's been going on in the markets,
Speaker 1: things you need to know about. Linked to the most
Speaker 1: recent podcast as well, and that's free to you at
Speaker 1: Classfinancial dot com. Speaking of things that are free to you,
Speaker 1: that first appointment no charge, It is complementary. All I
Speaker 1: gotta do is make that appointment by calling Class Financial
Speaker 1: office right here in Madison six oh eight four four
Speaker 1: two five six three seven. Again that telephon number six
Speaker 1: O eight four four two five six three seven talking
Speaker 1: rollovers this week with Malia and Kyle, and we left
Speaker 1: off talking about rolling over your old four oh one
Speaker 1: K into your new four to oh one K and Malia,
Speaker 1: I have to imagine that a common option for folks
Speaker 1: is maybe rolling over that old four oh one K
Speaker 1: into an Ira.
Speaker 3: Yeah. So, as as always when we're speaking about things
Speaker 3: you can do or shouldn't do, as you you know,
Speaker 3: look at your retirement accounts, we would just advise slow down,
Speaker 3: just slow down, And this option comes up, you know,
Speaker 3: probably the most frequent out there, one of the most
Speaker 3: frequent choices aside from people say I'm just going to
Speaker 3: cash out the whole thing, which Kyle clearly told us
Speaker 3: not to do that. So so when we say down,
Speaker 3: we want we want to make sure that you understand
Speaker 3: what you're doing and your choices. And so if you
Speaker 3: decide to roll over your four oh one K, you
Speaker 3: will open up an IRA. You can do that by yourself,
Speaker 3: you can do it at your local bank, you can
Speaker 3: do it with your financial advisor. And really the objective
Speaker 3: here is to take your traditional four oh one K
Speaker 3: or four O three B and you would move that
Speaker 3: potentially into a traditional IRA. Or similarly, if you had
Speaker 3: a wroth four oh one K balance, you would want
Speaker 3: to make sure that is transferred into a wroth IRA
Speaker 3: at any of these different institutions. So what you need
Speaker 3: to keep in mind if you do decide to go
Speaker 3: with choice number five here rolling that those retirement funds
Speaker 3: into an IRA, you have to understand this is not
Speaker 3: a taxable event, certainly not the WROTH. Everyone understands that
Speaker 3: that money went in after you paid taxes on it,
Speaker 3: and we'll continue it will continue to grow tax tax
Speaker 3: tax free. However, the pre tax accounts, the those will
Speaker 3: not create taxes until you take them out somedays, so
Speaker 3: keep that in mind. Not a taxable event. However, as
Speaker 3: we mentioned before, if you withdraw those funds the pretax
Speaker 3: from the IRA before the age of fifty nine and
Speaker 3: a half, you'll likely face a ten percent early withdrawal penalty.
Speaker 3: So why would you even put it into an IRA. Well,
Speaker 3: an IRA is going to give you more flexibility for distribution,
Speaker 3: so that is a common reason people will decide to
Speaker 3: go this way. So unlike four oh one K plans,
Speaker 3: they generally have stricter withdrawal rules. And you know, people
Speaker 3: don't like to have handcuffs on their own money, you know,
Speaker 3: so they like the opportunity to say and depending on
Speaker 3: where they're at in life, maybe they're getting very close
Speaker 3: to retirement, they want to be able to control the
Speaker 3: way in which their IRA assets are invested, and if
Speaker 3: they want to take money out of them, they want
Speaker 3: to be able to do it at their discretion. So
Speaker 3: some key considerations for why people do choose to do
Speaker 3: a roll over. Besides, the flexibility would be investment selection.
Speaker 3: So you know you're in an IRA, you're able to
Speaker 3: choose an investment strategy that maybe aligns better with your
Speaker 3: time horizon and also your risk tolerance. For example, you
Speaker 3: might want to invest in a CD within an IRA
Speaker 3: because that might offer you lower risk, but we have
Speaker 3: to keep in mind that might offer minimal growth as well,
Speaker 3: whereas a diversified portfolio of stocks and bonds could provide
Speaker 3: better long term potential. So we're not here to say
Speaker 3: that there aren't four oh one K four three B
Speaker 3: plans out there that don't have, you know, a host
Speaker 3: of selections, but they typically have less selections out there
Speaker 3: choices for you to make, so that again going from
Speaker 3: ten to one hundred choices or beyond might be important
Speaker 3: for you. Fees is another reason to con that are
Speaker 3: making the choice or not. You have to understand there's
Speaker 3: investment fees associated with both your old four oh one
Speaker 3: K and also the new IRA, and so leaving it
Speaker 3: behind might be the right choice because their fees are
Speaker 3: considerably less potentially, but again your choices might be limited
Speaker 3: as well. Timing in RMD rules is the next area.
Speaker 3: If you retire between the ages of fifty five and
Speaker 3: fifty nine and a half. And again this goes back
Speaker 3: to my beginning point, slow down, slow down. If you're
Speaker 3: retiring between those ages, our suggestion might be leave your
Speaker 3: money in that four oh one K because that may
Speaker 3: allow you to withdraw funds penalty free, whereas rolling it
Speaker 3: into an IRA could delay that option until age fifty
Speaker 3: nine and a half. So what I'm talking about here
Speaker 3: is for persons who are approaching the age of fifty
Speaker 3: five still working for the company. It's called separation of
Speaker 3: service at age fifty five, and they are potentially looking
Speaker 3: to completely retire, and they need to develop an income stream.
Speaker 3: If we're able to take money from that four to
Speaker 3: oh one k again before we've ever moved it over
Speaker 3: to an IRA. If we can start taking it from
Speaker 3: the four to oh one K, you will still have
Speaker 3: to pay taxes on that, but coming out of that
Speaker 3: vehicle will prevent this age fifty nine and a half
Speaker 3: termination fee, so to speak, this penalty. So we've done
Speaker 3: that with many many clients. It's an important thing to
Speaker 3: know before you just, you know, blatantly, Oh, I'm just
Speaker 3: rolling all over to an IRA, and I'll deal with
Speaker 3: it later. This could actually create some good income for
Speaker 3: you and not cause you to have that penalty, So
Speaker 3: make sure you know you're timing. Another area certainly is
Speaker 3: required minimum distribution. So we've got clients, I'll be honest,
Speaker 3: they work into their eighties. Not that you want to shine,
Speaker 3: but the rest.
Speaker 2: Of many people I'll like to work.
Speaker 3: But if you plan to work past age seventy two,
Speaker 3: and you're keeping funds in a current employer's four oh
Speaker 3: one K, that will allow you to continue to defer
Speaker 3: rmds until you stop working. So again, these people I'm
Speaker 3: speaking of are continuing to feed their four oh one
Speaker 3: ks and they are not forced to take rmds out.
Speaker 3: And RMDH today, of course is seventy three, so it's
Speaker 3: amazing you can continue to contribute and you're not forced
Speaker 3: to take out the required minimum distributions. And finally, wroth conversions,
Speaker 3: So if you roll traditional four to one K assets
Speaker 3: into a wroth ira, as Kyle mentioned earlier, taxes are
Speaker 3: due at the time of conversion, so you just want
Speaker 3: to be careful, don't rush through it. Get some good
Speaker 3: advice as to your situation and what you should do
Speaker 3: when you do leave an employer and those retirement assets.
Speaker 2: Great advice this morning.
Speaker 1: As we talked this morning with our retirement planning professionals
Speaker 1: from Class Financial, Melia Quavis and Kyle Kites, don't forget.
Speaker 1: You can learn more about Class Financial their website coss
Speaker 1: Financial dot com. Great website, coss Financial dot com. That's
Speaker 1: k l aas Financial dot com. They're telphone number six
Speaker 1: oh eight four four two five six three seven. No
Speaker 1: charts that initial gets to no deployment at costs Financial.
Speaker 1: It'll be complementary to you again that number six oh
Speaker 1: eight four four two five six three seven. So Kyle,
Speaker 1: what if I have maybe employer stock in my four
Speaker 1: oh one k? Anything I need to consider? There any
Speaker 1: special considerations in that area.
Speaker 4: Yeah, it's a great question, Sean. And this is this
Speaker 4: is a very can be a complex strategy until you
Speaker 4: get your arms around it. But there's something called a
Speaker 4: net unrealized appreciation. So this is a tax advantage way
Speaker 4: to transfer stock from your four oh one k into
Speaker 4: a taxable account while benefiting from the longer or lower
Speaker 4: long term capital gains. Tax rates get into this makes
Speaker 4: I just want to let everybody know we're not tax accountants.
Speaker 4: So always consult your CPA before making this decision, because,
Speaker 4: as I said, this strategy can be a great thing
Speaker 4: for some people, but you have to understand what you're
Speaker 4: getting into. So here's how it works. So typically, when
Speaker 4: you pull money out of a four to one K,
Speaker 4: as we've been talking about, your withdrawals are going to
Speaker 4: be taxed as or so again, whatever tax bracket you're
Speaker 4: in when you pull as those funds out, that's the
Speaker 4: tax rate you're going to pay. However, under the NUA strategy,
Speaker 4: the growth on employer stock qualifies for the lower long
Speaker 4: term capital gains tax rate rather than being taxed as
Speaker 4: ordinary income. So again, think of this as if you've
Speaker 4: got employer stock inside your foural one K. This is
Speaker 4: where an anyway strategy could come into play. So what
Speaker 4: the big thing that you have to be aware of, though,
Speaker 4: is that the original cost basis of the shares is
Speaker 4: subject to ordinary income tax when distributed. So I'm going
Speaker 4: to give you an example to kind of bring all
Speaker 4: this together. So let's say the cost inside your four
Speaker 4: oh one K is one hundred thousand dollars, meaning that's
Speaker 4: what you've paid for it, or that's what it was
Speaker 4: worth as the company was great, and you shares throughout
Speaker 4: the years, but today when you go to retire, those
Speaker 4: same shares excuse me, are worth a million dollars, So
Speaker 4: one hundred thousand dollars basis of million dollars of gain
Speaker 4: if you elect the any income tax on that one
Speaker 4: hundred thousand dollars of basis that I just mentioned, but
Speaker 4: that remaining nine hundred thousand a million minus the hundred
Speaker 4: That remaining nine hundred thousand is going to be taxed
Speaker 4: at long term capital gains tax rates, which for most
Speaker 4: people is a lot more favorable because the maximum long
Speaker 4: term capital gains rates actually twenty percent, but most people
Speaker 4: pay somewhere around fifteen percent for long term capital gains.
Speaker 4: So these transactions are most beneficial when you've seen substantial growth.
Speaker 4: So kind of like what I was just explaining out
Speaker 4: in my example there. But you've got to be remember
Speaker 4: there's a few things that have to be met for
Speaker 4: this to work. So there has to be a triggering
Speaker 4: event such as a retirement, losing your job, or turning
Speaker 4: fifty nine and a half. That could be what needs
Speaker 4: to happen. But the entire four to one K plan
Speaker 4: must be emptied in one calendar year, so again doesn't
Speaker 4: mean it all has to come out at one time.
Speaker 4: You just have to do the NUA transaction and roll
Speaker 4: the rest of the money out of the four oh
Speaker 4: one k in the same calendar year. And that stock
Speaker 4: must be moved in kind. So if it's whatever your
Speaker 4: employer's stock is, it has to stay those shares into
Speaker 4: this new tax will brokerage account. As soon as you
Speaker 4: move it. You can always sell those shares, but it
Speaker 4: has to move in kind like that. So these strategies
Speaker 4: can certainly reduce overall tax liability. They also remove these
Speaker 4: assets from the tax deferred environment of a retire not
Speaker 4: right for everybody, as we've been kind of explaining.
Speaker 2: Here talking this morning with Kyle Kaite and Maliakuavis.
Speaker 1: They are our retirement planning professionals from Class Financial. The
Speaker 1: website COSS financial dot com. That's Coss k l aas
Speaker 1: Financial dot com. They're telephone number for the office right
Speaker 1: here in Madison, sixt'h eight four four to two five
Speaker 1: six three seven. No charge for that initial get to
Speaker 1: know your appointment. Tech Loss Financial complementary to you again
Speaker 1: their number six oh eight four four two five six
Speaker 1: three seven. Kyle any final thoughts on on on the
Speaker 1: old four one ks.
Speaker 4: Yeah, it's definitely something to be aware of, and obviously
Speaker 4: Malia kind of mentioned this too. If you're considering rolling
Speaker 4: over at old four oh one, k, take the time
Speaker 4: to evaluate all your options and consult with the financial
Speaker 4: professional to make the most informed decisions. We said, there's
Speaker 4: a lot of kind of steps you got to be
Speaker 4: aware of here in places to make a misstep, So
Speaker 4: you definitely want to get some help when you're considering
Speaker 4: these things.
Speaker 1: Really important guidance this week, as always from our retirement
Speaker 1: planning professionals from Class Financial, I mentioned the website Cossfinancial
Speaker 1: dot com. One thing I haven't mentioned is you can
Speaker 1: submit a question right online for the Money and Motion
Speaker 1: listener question corner. As a matter of fact, coming up
Speaker 1: to the next segment, we will answer Martha's question. We'll
Speaker 1: also do the COSS Quiz question week. You're going to
Speaker 1: want to sit tight for that. More of Money in
Speaker 1: Motion with Coss Financial comes your way next right. You're
Speaker 1: on thirteen ten WIBA talking this week with our retirement
Speaker 1: planning professionals Malia Quavis and Kyle Kite. Of course they
Speaker 1: come to us from Class Financial website Coss Financial dot com.
Speaker 1: That's Coss Klaasfinancial dot com. Tell phone number six oh
Speaker 1: eight four four to two five six three seven. No
Speaker 1: charge for that initial get to know you appointment at
Speaker 1: Class Financial. It will be complimentary to you again their
Speaker 1: number six oh eight four four two five six three seven.
Speaker 1: Hold on to that telephone number as a well. Coming
Speaker 1: up a little bit later in the segment, we'll do
Speaker 1: the Class quiz Quench leak your chance to win a
Speaker 1: twenty five dollars gift card to IOP. Before we get
Speaker 1: to that, another really cool thing that folks are able
Speaker 1: to do is email a question for the Money in
Speaker 1: Motion listener Question corner and Martha road in. She says,
Speaker 1: I'm turning sixty five soon and eligible for Medicare, but
Speaker 1: my spouse is still working and will be uh and
Speaker 1: we're covered under their employer sponsored health insurance. Should I
Speaker 1: enroll in Medicare now or should I stay on my
Speaker 1: spouse's plan? Malia have at it.
Speaker 3: Yeah, so that's a really good question. It's nice to
Speaker 3: have choices. Let's start there. So, whether you should enroll
Speaker 3: in Medicare at sixty five or stay on your spouse's
Speaker 3: health plan? Does depend on a few key factors. So
Speaker 3: first you're you're gonna want to check can You probably
Speaker 3: already know this whether your spouse is in play layer
Speaker 3: has twenty or more employees, So if so, their health
Speaker 3: insurance is considered credible coverage, meaning you can delay Medicare
Speaker 3: enrollment without penalties. So in this case, you might choose
Speaker 3: to stay on their plan, especially if it offers better
Speaker 3: coverage or lower costs than Medicare. You know, Medicare just
Speaker 3: to go off. We had a discussion last week on
Speaker 3: Medicare coverage. It's not that a lot isn't covered on
Speaker 3: Medicare coverage, but it is different than what you're probably
Speaker 3: experiencing being under your the employer plan of your spouse,
Speaker 3: So you do want to understand what you might be
Speaker 3: giving up if you switched over to Medicare. So, if
Speaker 3: your spouse's employer has fewer than twenty employees, Medicare does
Speaker 3: become the prime primary payer for you. Your spouse's plan would
Speaker 3: only pay secondarily, So in this situation you should you
Speaker 3: should enroll Medicare Part A and Part B to ensure
Speaker 3: your full coverage and again avoid potential late enrollment penalty.
Speaker 3: So the key here. You really want to understand are
Speaker 3: there twenty or more employees with his company or less?
Speaker 3: And then also you want to consider the costs and
Speaker 3: coverage of each option. So Medicare might have lower premiums
Speaker 3: and out of pocket expenses than your spouse's plan or
Speaker 3: vice versa. But if you do end up choosing to
Speaker 3: delay Medicare, you're going to want to sign up during
Speaker 3: the Special Enrollment Period the SEP once your spouse retires
Speaker 3: or or you lose coverage, lose their coverage to avoid
Speaker 3: late penalty. So do some research. I'm glad you checked
Speaker 3: in with us and best of luck.
Speaker 1: Really good question, Martha, and another place you can get
Speaker 1: some more information. As Malia mentioned last week, we did
Speaker 1: talk about Medicare. Great podcast that's available to you at
Speaker 1: COSS Financial's website cossfinancial dot com. That's cost k l
Speaker 1: aasfinancial dot com. Tell for number six O eight four
Speaker 1: four two five six three seven. No charge for that
Speaker 1: initial get to know your appointment tech Loss Financial. It
Speaker 1: will be complimentary to you again their number six oh
Speaker 1: eight four four two five six three seven. You can
Speaker 1: you want to hold on to that telephon number now
Speaker 1: because it's time for the Coss Quiz question of the week.
Speaker 2: It works like this. In just a moment, I'll ask
Speaker 2: you the class quiz question week.
Speaker 1: You will then have thirty minutes from the inter Today's
Speaker 1: program to call the Coss Financial Office right here in
Speaker 1: Madison at six oh eight four four two five six
Speaker 1: three seven. If you are the first caller with the
Speaker 1: correct answer, you'll win this week's prize, which is a
Speaker 1: twenty five dollars gift card to I Hop. This week's
Speaker 1: class quiz question the week is this true or false?
Speaker 1: If you take a distribution from your four oh one
Speaker 1: K before the age of fifty nine and a half,
Speaker 1: you will likely face a ten percent early withdrawal penalty.
Speaker 1: Is that true or is that false? Telephone number six
Speaker 1: oh eight four four two five six three seven. First
Speaker 1: Garth correct answer won the twenty five dollars gift card
Speaker 1: to the International House of Pancakes. Also, don't forget that's
Speaker 1: Class Financials office right here in Madison six oh eight
Speaker 1: four four two five six three seven. No charge for
Speaker 1: that initial get to know your appointment at COSS Financial
Speaker 1: is complimentary to you again their number six o eight
Speaker 1: four four two five six three seven. Melia Kyle, It's
Speaker 1: been great chatting with both of you guys. Have a
Speaker 1: great spring and look forward to talking again real soon.
Speaker 3: Thanks Sean, Yeah, thanks Sean.
Speaker 1: Take care guys, Doctor Marty Greer. She joins us next
Speaker 1: here on thirteen ten. Wiva