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About James Lange
Jim's estate and tax planning strategies have been endorsed by The Wall Street Journal (36 times), Newsweek, Money,
Smart Money, Reader's Digest, Bottom Line, and Kiplinger's and most recently, Forbes magazine. Jim has authored five peer-reviewed
articles in Trusts & Estates. Jim is a regular columnist for Forbes.com, and his expertise on Roth IRA conversions was
solicited for an article in the February 2019 issue of Forbes magazine.
With 35 years of retirement and estate planning experience, James Lange and his team have drafted 2,631 wills and trusts, as well
as sophisticated beneficiary designations for IRAs and other retirement plans using Lange's Cascading Beneficiary Plan. They
have also administered hundreds of estates whose families have benefitted from these plans.
Mr. Lange is the author of six best-selling books, including three editions of Retire Secure!, endorsed by Charles Schwab, Larry King, Ed Slott, Jane Bryant Quinn, and Roger Ibbotson and 50 other experts; The Roth Revolution, endorsed by Ed Slott, Natalie Choate, and Bob Keebler; The Ultimate Retirement and Estate Plan for Your Million-Dollar IRA, endorsed by Bill Flanagan, Paul Merriman, and Burton Malkiel; and The $214,000 Mistake, How to Double Your Social Security and Maximize Your IRAs endorsed by Larry Kotlikoff, Jonathan Clements, Paul Merriman, and Elaine Floyd.
Jim created The Roth IRA Institute--offering professionals in the industry advice and recommendations. His proof of the tax and estate planning advantages of Roth IRA conversions has been peer-reviewed by the top tax journal of the American Institute of CPAs. Further, all 15 IRA experts interviewed on his radio show have indicated that most taxpayers, at some point, will benefit from a Roth IRA conversion--and that was before today's favorable new tax brackets made Roth IRAs even more advantageous.
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The ticking time bomb is the provision that radically modifies the required minimum distribution (RMD) rules for Inherited IRAs and retirement accounts. Subject to some exceptions, an Inherited IRA or retirement plan will have to be distributed and taxed within 10 years of the original owner’s death. This forced income tax acceleration will decimate the savings and undermine the long-term financial plans of many hard-working retirement plan owners and their families.
What might it mean to you?
Consider the following scenario: On the morning of December 31, 2019, two elderly men in poor health who each have exactly $1,000,000 in their IRAs are admitted to the hospital. The first man dies within an hour of being admitted to the hospital. The man second dies the following afternoon—January 1, 2020. Each of the men bequeathed his $1 million IRA to his 45-year-old daughter. Both of these women earn the same amount of money. They retire at exactly the same time. They receive identical Social Security benefits. They even have identical annual expenses. In fact, in terms of income and spending, these women behave identically. However, at age 86 the first man’s daughter has $2,236,583, and the second man’s daughter is broke.
That jaw-dropping difference—in our hypothetical example—is an all-too-real possibility for the children of millions of IRA and retirement plan owners (see Graph 0.1 for more details). What a difference a day makes.
The IRA and Retirement Plan Owner’s Guide to Beating the New Death Tax, draws on Mr. Lange’s more than thirty years’ experience as a practicing estate attorney and CPA and his depth of research and analysis. For all those years, Jim has trained his laser focus on the unique planning requirements and opportunities for IRA and retirement plan owners. He clearly identifies the problems and opportunities generated by the passage of the SECURE Act and offers his exceptional strategic solutions to these challenges. In response to the ongoing and unprecedented COVID-19 global health crisis, the book has been updated to include tax-savvy responses to the recent economic downturn and the Coronavirus Aid, Relief, and Economic Security Act (CARES).
Retirement plan owners can use these practical, proven, and strategic defenses to protect their financial legacies. Through the use of real-world questions and answers, examples, and illustrations, the reader will discover:
• How to use Roth conversions to minimize taxes on your IRA income for decades -- for both you and your family.
• How to optimize Social Security strategies in light of the SECURE Act.
• How to use gifting strategies to adroitly maximize family wealth under the SECURE Act.
• How to update your wills and trusts for greater flexibility and protection against the SECURE Act.
• How to ensure financial security for your surviving spouse after you pass.
• Why leaving your IRA to a charitable remainder trust (CRT) can be more beneficial to your children than leaving the IRA to them outright -- as bizarre as that may sound.
• Why owning investments in jointly held accounts with your spouse is probably a bad idea after the SECURE Act.
• How to combine multiple tax-reduction methods for maximum benefit.
• And more...
With clear examples and uncomplicated language, the book shows you how to implement proven strategies that will prevent married couples from losing hundreds of thousands of dollars. The $214,000 difference referred to in the book title is shown in Figure 3, on page 19. The math for doubling your Social Security can be found on page 20.
The book also covers how to combine optimal Roth IRA conversion strategies with the best Social Security strategies. The timing of Roth IRA conversions and Social Security distributions can easily make a difference of $1,000,000 or more. Under the newly passed Trump tax bill, the difference could be $1,500,000 or more. (See page 5).
Furthermore, getting Social Security right is a woman’s issue. Getting Social Security wrong not only hurts the primary wage earner of the couple, but could be devastating for the dependent spouse, usually the wife. For example, if the primary-wage-earning-husband collects too early, not only will his benefit be less than half of what it could be, his wife will get less than half if he dies first. And, since statistically women live on average seven years longer than men, a man making the wrong decision about his Social Security could unnecessarily doom his wife to a life of poverty after he dies.
Critical strategies covered in this book include:
• Why you should delay claiming your benefits—don’t forfeit $214,000 for all the wrong reasons.
• How to receive larger monthly checks with Cost of Living Adjustments (COLAs) and guaranteed annual 8% “raises.”
• How maximizing your benefit can provide your surviving spouse with a long-term security life-line.
• Optimal marital strategies including filing a restricted application.
• The financial synergy between Social Security and Roth IRA conversions—especially under the new laws.
All proceeds from this book go to charity: water, a non-profit organization working in partnership with local organizations to bring clean and safe drinking water to people around the world.
What Others are Saying:
“Read James Lange’s excellent book and learn how and when to take your Social Security and retirement accounts. Doing so will pay for itself hundreds if not thousands of times over.”
— Laurence Kotlikoff, Boston University Economist, co-author of Get What’s Yours: Revised & Updated: The Secrets To Maxing Out Your Social Security
“Social Security is the best income stream available to retirees — and you want to get as much of this income as possible. But how? To find out, make it a priority to read Jim Lange’s brief but fabulously insightful new book.”
—Jonathan Clements, author of How to Think About Money and former personal-finance columnist for The Wall Street Journal
“If you spend 60 minutes with this book, you may be able to increase your lifetime income from Social Security by tens of thousands or even hundreds of thousands of dollars.
A comprehensive and easy-to-understand guide to maximizing the benefits of IRAs and retirement assets. Retire Secure! Third Edition offers unbeatable recommendations for addressing the #1 fear facing most readers: Running out of money. Retire Secure! Third Edition also shows baby boomers nearing retirement how they can save tens of thousands to over one million dollars by paying taxes later.
This practical guide, perfect for consumers, but detailed enough for financial experts, delivers straight forward accumulation and distribution strategies for IRAs, Roth IRAs, the new Roth 401(k) and other retirement plans. More specifically, Lange gives his readers tips on how to prepare for expected “death” of the stretch IRA, details on converting to Roth IRAs, Roth 401(k) and Roth 403(b) rules, and when IRA and retirement plan owners should consider second-to-die life insurance.
Further, this book describes Lange's exceptional estate plan--a plan that has been featured in The Wall Street Journal and many other fine financial journals. This definitive guide enjoys glowing endorsements from Charles Schwab, Larry King, Ed Slott and 60 other financial authors and experts.
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I ran the numbers, given certain assumptions, for a million-dollar traditional IRA left to a 45 year old child under the existing law and under the proposed SECURE Act. With the existing law in place, at age 86, that beneficiary still has $2,236,583. By contrast, under the SECURE Act the beneficiary has $0. (You can find the graph charting this comparison and the accompanying assumptions in the book.) The only difference between these two scenarios is when the beneficiary pays taxes. This is the difference between your child being financially secure versus being broke. Congress is trying to gloss over this point. “Secure?” I don’t think so.
We are distributing this book NOW so you can quickly take the appropriate actions and make appropriate plans to protect your family. Reading this book and taking the right steps can mean the difference between your family being broke and being financially secure.
The SECURE Act is wrapped with goodies that are of limited benefit to most established IRA and retirement plan owners. Unfortunately, it has a provision that could cost many of the families of IRA and retirement plan owners a million dollars or more.
The provision seriously modifies the required minimum distribution (RMD) rules for Inherited IRAs and retirement accounts in a way that would, subject to exceptions, cement “the death of the stretch IRA.” Under current law, a non-spouse beneficiary of an Inherited IRA can “stretch” distributions from the account over the course of his or her lifetime by limiting distributions to the required minimums. Using the “stretch” means the beneficiary can keep the bulk of the assets in the tax-deferred environment (for traditional IRAs) or tax-free environment (for Roth IRAs).
The SECURE Act’s proposed revisions represent a huge and fundamentally negative change to Inherited IRA owners because eliminating the rules that allow them to stretch distributions over their lifetimes robs them of decades upon decades of tax-deferred or tax-free growth. And, it subjects the beneficiaries of traditional (tax-deferred) retirement plans to massive income-tax acceleration. Additionally, for both traditional and Roth Inherited IRAs, once the distributions are made to the beneficiary within 10 years of your death, the accounts will lose the income tax protection that they currently enjoy. Ten years after your death, your beneficiary will have to start paying income taxes on the dividends, interest and realized capital gains.
Action Points You Should Consider Now
So what can retirement plan owners do to respond to these impending changes? How can they protect the financial legacy they hope to leave for their children and grandchildren?
In this book you’ll discover solutions including:
• Roth IRA conversions,
• Social Security Planning,
• Reviewing and revising your Estate Plan including the Beneficiary
Live Gay, Retire Rich! is an updated version of Retire Secure! for Same-Sex Couples, now updated to include the positive holding of the Supreme Court Case Obergefell v. Hodges and its implications. Highly reguarded and endorsed by dozens of financial professionals, Live Gay, Retire Rich lays out the best retirement and estate planning advices for same sex couples and teaches them how to make the most out of their retirement savings. For example:
There were two gay couples with identical financial resources. They each had the same amount of money, identical investments, identical taxes, and identical earnings history for Social Security purposes. The first couple didn't do any planning. The second couple followed the advice offered in Live Gay, Retire Rich! Doing reasonable projections, the first couple runs of out money in 28 years while the second couple has $1.4 million and their portfolio continues to increase.
What was the difference? The first couple didn't follow the advice in Live Gay, Retire Rich, but the second couple did. The first couple never got married, started receving Social Security benefits at 62, didn't make any Roth IRA conversions, and didn't use key IRA and retirement plan estate planning strategies recommended in Live Gay, Retire Rich! The second couple did get married, used our recommended apply and suspend technique for Social Security, did a series of Roth IRA conversions, and used the key IRA and retirement plan estate planing strategies we recommend.
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The first couple didn't do any planning. The second gay couple followed the advice offered in Retire Secure for Same Sex Couples. Doing reasonable projections, the first couple runs out of money in 28 years while the second couple has $1.4 million dollars and their portfolio continues to increase.
What was the difference? The first couple never got married, started social security at 62, didn't make any Roth IRA conversions, and didn't use key IRA and retirement plan estate planning strategies.
The second gay couple did get married, used our recommended apply and suspend technique for social security, did a series of Roth IRA conversions, and used key IRA and retirement plan estate planning strategies.
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