On March 27, 2020 the president signed the CARES Act as part of an effort to ease the adverse financial consequences of the COVID-19 pandemic. While a lot of attention has been paid to the unemployment benefits, the payroll protection plan (PPP), and other portions of the CARES Act, the relief Congress provided to those who must take required minimum distributions from their qualified retirement plans (which we’ll call IRAs), and beneficiary or inherited IRAs (which we’ll call inherited IRAs) received very little attention. The CARES Act provides that required minimum distributions have been suspended for the year 2020.
As discussed in our overview of the CARES Act, small businesses nationally may be struggling to stay open, retain their employees, and keep up their cash flow all while making sure they keep themselves, their employees and their clients safe and healthy. The CARES Act has several programs that can help small businesses through these unprecedented times including two different loan programs and some tax provisions. You can read a great article by Michelle Black from Forbes.com (here) that we reviewed in putting together this blog.
During this season of life, where everyone is trying to figure out a new “normal,” adjust to changing circumstances, and make their way through new challenges, taking care of the ones you love seems to be pretty central to many people’s thoughts. Here at Family Estate Planning Law Group, we’re thinking about that too—taking care of our own families, and how we can continue to help you take care of yours. We recently came across a newsletter from Dianne Savastano at Healthassist, one of the many great organizations in our network of referrals, that contains a lot of information we thought might be helpful to our clients regarding caring for and protecting their families and loved ones (we encourage you to read it for yourself here).
Our Marketing Director Heidi Cookson shares some wisdom on student loan debt and your estate plan.
As someone who graduated college not too long ago, recently refinanced my student loans, and is about to embark on the journey of graduate school, there is one big elephant in the room: student loan debt. I am one of the millions of contributors(approx. 45 million people according to The Motley Fool) to the $1.6+ trillion of debt. The joke I frequently crack with my family and with my friends who are also feeling the pressing weight of student debt is, “at least if I die, the debt disappears *poof*”. This ultimately leads to drumming up fantastical stories of how to fake my death and live off the grid or assume a new identity to escape the ever-mounting sum, which can feel quite crippling. (Of course, as a Native Vermonter, the living off the grid option seems the most feasible and appealing.) This joke about faking death is one I am sure many parents and fellow student loan holders are familiar with.
The tiny home trend has become a very popular topic among retirees and millennials and those who want to downsize and spend less money. A tiny house might actually be a great idea for your aging parent(s) or if you want to change your living situation in retirement, there is less maintenance for the home since there is less square footage and in many cases it’s cheaper than a full-sized home.
Millennials are notorious for minimalist practices and trying to save money and retire comfortably or early (if you missed our article, New Millennial Retirement Method: Spending Nothing and Trying to Retire Decades Early, read it here). Millennials are also into the tiny house trend, yet another millennial trend that could be extremely beneficial if you are preparing to retire or trying to figure out what is next for your aging parents.
It can seem complicated, you may even be skeptical about it, but online banking isn’t only easier – it can actually gain much more money for you.
With the dawn of cybersecurity becoming more necessary sometimes than physical security, the concept of online banking can seem really daunting to some. It seems as though everyone is touched to some extent by online scams, identity theft, etc. If it hasn’t happened to you already, perhaps it happened to someone you know. Even if you’re not necessarily concerned about your online security, many are daunted by the complicated nature of online banking.
In a perfect world, we’d all have our estate plans created when we started working, updated when we married, updated again when our kids were born and had them revised a few times between the day we retired and when we died. In reality, a recent report by Merrill Lynch and Age Wave says that only half of Americans have a will by age 50.
More than 50% said their lack of proper planning could leave a problem for their families.
If you are wealthy, expect an inheritance or have been married before and have children from a prior marriage, you may want to consider a prenup or a postnup as a useful planning tool. An article from Investopedia, “Prenup vs. Postnup: How Are They Different?” explains why these documents are important.
A prenuptial, made before the marriage occurs, or a postnuptial, made after you’ve said your wedding vows, serves to protect both parties from the emotions (and some of the drama), if the marriage should hit the skids or when one of the couple dies.
All you have to do to meet the requirements for having a Roth IRA, says Investopedia in the article, “Roth IRA Contribution Rules: The Basics,” is work for a living. That can be earned income that you get from a job, including commissions, tips and taxable fringe benefits, or net earnings for the self-employed.
You may have envisioned a time in the future, when your children and grandchildren enjoy the same lakeside home as you have for years after you’re gone, and are pleased with the idea of leaving the family vacation home to the next generation. But think again, says a recent article in Financial Planning, “Save clients from tax pitfalls, family strife when passing on that lake cabin,”because your vision may not translate into reality.