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Brian J. O'Connor

Posts by Brian J. O'Connor

Mortgage

I’m Selling My House and Netting $675k to Downsize for Retirement. How Can I Avoid Capital Gains Taxes?

It’s often said that buying a house is one of the best investments you can make. And, just like any investment, it comes with tax issues.  With an investment like stocks or bonds, the profit you make when you sell your holdings – minus the initial investment and any expenses that comprise your tax basis … read more…

Retirement

I’m 60 With $1.5 Million in My 401(k). Should I Convert $120,000 per Year to Avoid RMDs?

It’s a wise move to plan ahead for the taxes you’ll pay on retirement income, including eventual required minimum distributions (RMDs). Instead of waiting until the RMD deadline to start thinking about tax planning, starting the process at age 60 gives you the luxury of time to weigh all of your options and adjust your… read more…

Retirement

I’m Going to Get $2,500 per Month From Social Security. How Can I Reduce My Taxes?

Taxes can be a big concern in retirement because no matter how well you’ve saved and invested during your working years your challenge is to keep as much of it as possible. That means structuring your finances, withdrawals and income in a way that minimizes how much you fork over to the IRS.  Take Social… read more…

Retirement

I Am 58 With $1 Million in My 401(k). Should I Switch to Roth Contributions?

I Am 58 With $1 Million in My 401(k). Should I Switch to Roth Contributions? Whether to make the move from contributing to a tax-deferred workplace plan or switch to a Roth isn’t a question of “should” but a question of, “What works best for you?” Just a few of the considerations are: You can… read more…

Retirement

I Waited to Take My First RMD Until April 1st. Will This Affect My Second Year’s RMD?

Unlike most personal finance questions, the answer to this one is short and simple: yes, waiting until April 1st to take your first RMD will affect the amount of your second year’s RMD. The IRS rules on required minimum distributions – RMDs – demand that anyone turning 73 in 2024 withdraw a certain minimum amount… read more…

Retirement

A Successful Retirement May Hinge on Avoiding These Careless Mistakes

Deciding to retire can feel a bit unnerving. Retirees have plenty to potentially worry about – some of which they have no control over – like how the market will perform and how fast prices at the supermarket will increase. But regardless of the economic environment, simple mistakes can prove costly for retirees. Here are… read more…

Retirement

I’m Going to Get $2,800 Per Month in Social Security. How Do I Reduce My Taxes on It?

One of the biggest surprises would-be retirees face when planning their retirement finances is the fact that their Social Security benefits could very well be subject to income tax. A financial advisor can help you plan for Social Security and potentially minimize your tax bill on your benefits. Connect with a fiduciary advisor today. One… read more…

Retirement

Can I Use My RMDs to Transfer Money Into My Roth IRA?

If you’re taking a required minimum distribution from an IRA, 401(k) or other tax-deferred account and don’t need the money to cover living expenses, where should you stash that unneeded cash? Investors now need to start taking RMDs at age 73 or, if they were born after 1960, at age 75. Depending on the balances of… read more…

Retirement

I Have a 401(k) From a Previous Employer. What Should I Do With It?

If you’ve changed jobs recently, don’t put off deciding what to do with your 401(k) for too long. While you have several options for your account when you leave a job, there’s an estimated 29.2 million 401(k)s that have been left behind with former employers, according to a 2023 analysis from Capitalize. Those accounts hold… read more…

Retirement

This Is My First Year Taking RMDs. What Should I Do With the Money If I Don’t Need It Yet?

Anyone with a 401(k), traditional IRA or similar tax-deferred retirement account eventually is going to face the requirement to start taking required minimum distributions (RMDs) from their accounts. The IRS has allowed you to have what can be decades of tax-free growth in the account, along with years of tax deductions, so they eventually requiring… read more…

Taxes

Tax Credits You Can Use to Reduce Your 2024 Taxes

Tax season has arrived, and when it comes to preparing your return remember this: deductions are good, but tax credits are better. Anyone who’s paid taxes knows the value of deductions, which reduce the amount of your tax bill at your marginal tax rate. If you’re in the 22% federal tax bracket and you deduct $2,000 in… read more…

Insurance

We Put $80k of Renovations Into Our Home. Do We Need to Report It to Our Homeowners Insurance?

Homeowners naturally know that the price tag for remodeling and improvements can be high. An average kitchen remodel, according to Home Advisor, costs more than $40,000, while a lavish makeover that includes custom cabinetry, fancy tile backsplashes and restaurant-quality appliances can run more than $130,000. A financial advisor can help you plan for major home… read more…

Retirement

When Should I Take My First RMD?

You may not be thinking about required minimum distributions (RMDs) throughout your career, but chances are that they’ll be on your mind once you hit your 70s. RMDs are a critical part of retirement planning. A financial advisor can help you prepare for these mandatory withdrawals, which can have a significant impact on your taxes.… read more…

Taxes

My Dad Left Me $450k in an IRA, But I’m in the 32% Tax Bracket. How Should I Structure My Withdrawals?

There are a couple of different sets of rules around inherited IRAs and you’re subject to theleast flexible. While there are more options for a spouse or someone who’s chronically ill ordisabled, a minor child, or someone not more than 10 years younger than the deceased IRAowner, you have just 10 years to withdraw the… read more…

A senior calculating how much he will owe in RMD taxes.
Financial Advisor

I Turn 73 This Year. How Do I Avoid RMD Taxes?

The IRS allows workers to put aside pre-tax earnings in traditional Individual Retirement Accounts, 401(k) and similar workplace accounts, and for all the money to grow – tax-deferred – to give you cash for retirement. But the national tax collector only waits so long to collect, and once you turn 73, the law forces retirees… read more…

Retirement

Is It Better to Take My RMD Later or Earlier in the Year? How Do I Decide?

People often think they don’t have any choice about taking the IRS-mandated required minimum distributions from their retirement accounts – but they do. While you can’t skip making the withdrawal they can choose how to time it in a way that works best for their individual financial situation. Required minimum distributions – RMDs, for short… read more…

Retirement

Is It Better to Take Annuity Payments Monthly or Once Per Year?

A lot of retirees use annuities to simplify their income stream in retirement but that doesn’t mean annuities are simple. Beyond choosing what kind of annuity to purchase – immediate vs. deferred and fixed, indexed or variable, you’ll also need to consider how to receive your annuity payments. You can receive a lump sum from… read more…

Retirement

Which of These Retirement Savings Trends Fit Your Financial Situation?

Despite recent years of inflationary spikes and stock market volatility, most Americans haven’t cut their retirement savings rate. They also don’t plan to sell assets or investments and are taking action to get professional advice to plan their retirement. If you need help saving and planning for retirement, consider working with a financial advisor. Those… read more…

Taxes

Important Tax Changes to Know Before You File in 2024

If there’s one thing you can depend on when it comes to taxes, it’s that at least some of the rules, exemptions and deductions are sure to change every year. This year was no exception, as many things have changed for 2023 taxes being filed by April 2024. So before you start pulling together the… read more…

Retirement

This Proposed Roth IRA Rollover Legislation Could Revolutionize Roth Retirement Savings Accounts

Workers with their own personal Roth IRAs would be able to roll those accounts into a workplace Roth 401(k) and some similar accounts under legislation recently introduced in the House of Representatives by two of its members. These other accounts types could include 403(b)s and 457(b)s. If signed into law, this proposal could change the… read more…

Retirement

Study Shows Major Differences in How People and Their Employers View Their Retirement Readiness

The bosses who sponsor retirement investment plans think their employees are well prepared for retirement. However, many of those workers don’t feel the same way. This difference in opinion could cause a disparity on the decision-making side of employee retirement account management. Do you have questions about building a retirement plan? Speak with a financial… read more…

Taxes

The Ultimate List of End-of-Year Tax Tips

As the end of the year nears, calendars are crowded but make sure you set aside time to make sure your 2023 taxes won’t come back to bite you in 2024. Year-end tax moves fall into two categories: options that can save you money and required chores that can cost you money if not done… read more…

Retirement

Are Annuities Actually as Valuable as They Seem?

A new study titled “How Much Do People Value Annuities and Their Added Features?” from the Center for Retirement Research at Boston College finds that while just 12% of investors with assets of more than $100,000 open an annuity, more than 50% of investors who could benefit from a simple annuity don’t buy one because… read more…

Retirement

The 4% Rule for Retirement Withdrawals Might Finally Be Safe to Use Again, Says Morningstar

There’s been an ongoing debate about whether retirees should abandon the “4% rule” for withdrawals from retirement accounts, a retirement income rule of thumb for decades. The market volatility of recent years made that rule suspect for many new retirees, but a new study from Morningstar finds that the rule can still apply. Do you… read more…

Retirement

High Cost of Living Surpasses Retirement Preparedness as Top Financial Concern, Study Says

A recent survey of employers from the Employee Benefit Research Institute (EBRI) uncovered a major shift taking place among American companies and their workers. Instead of putting retirement readiness at the top of their list of financial concerns, they’re increasingly becoming more worried about cost of living. This shouldn’t come as a total surprise, considering… read more…