Tag Archives: SEP

Q2 2022 J.K. Financial, Inc. Newsletter … Video Audio Podcast Review ! By John Kvale CFA, CFP

Welcome to our Video and Audio Podcast Review of our Q2 2022 Newsletter. For those on the road or just unable to grab the time to read, our podcast type review gives you the behind the scenes insight to our thoughts, observations and deep views of the entire Newsletter.

BREAK IN – We are trying a new format of articles that are shorter, and hit a very wide variety of topics that should interest all ages and chapters…. Let us know what you think?

Click the Download button below, for a direct link to an electronic version (an early peek-good ole fashion paper versions are on their way to you shortly) and here for our Newsletter page

Let’s get going! We hope you enjoy!

Q 2 2022 Newsletter

(YouTube)

All about the Stimulus Base Effects and the Coming Comparable (Hurdles)

In our main article, a somewhat follow up article to our Q 1 2022 Newsletter Main Article “Anatomy of a Slowdown” we review the base effects we as an economy are about to have to hurdle.

Sale of many companies exploded higher, similar to the one below, but now must be digested..

Look Back Tax Savings – Spousal IRA – SEP – HSA  , These can be done before your filing due date of April 18 to Possible Lower Your 2021 Taxes 

With tax season officially underway, actually nearing an end, the official filing date for non-extension regular Form 1040 Filers is April 18th, 2022 (this year) for year 2021 tax filings, just a few weeks out. There are a few tax saving ideas that even with the turn of the calendar can be implemented to possibly help last year’s income taxes. 

Self Employed Pension plan-the SEP as it’s commonly called is a great vehicle to offset income that is not of the W2 type, think consulting income.

The Spousal “Qualified IRA” is another handy tool to use if one of the spouses does not have any form of a retirement plan.

The HSA. One of the great parts of the HSA is you only need a high-deductible health insurance plan

Estate and Gift Planning Update – Annual Gifting Amount – Estate Tax Update 

Annual Gift amount upped to $16k per person

Estate Tax Stands at $12.06 million per person or $22.12 million per couple

“Last year certainly garnered many headlines of possible changes in much of the estate tax laws. In all fairness we fielded many questions and thankfully once again stuck to our mantra of until it is law, one should be very careful at making preemptive adjustments. There certainly can be changes in the future, but again short of knee jerk reactions, we tend to like for law mandates to be made for reaction, rather than rumors. “

Financial Planning/Retirement Planning Trick for those Early in the Workforce – Roth contribution for young working

Helping a new worker contribute to a Roth and an early age to jumpstart a retirement program…

From the Article…

“Most likely if a young worker is making a very nominal amount, and possibly still living at home, they will not have the cash flow to contribute to any type of retirement plan. But if someway somehow they can make a Roth contribution at least up to their earnings at a very young age the long term positive consequences of this can obviously be fantastic.”

“If a 17 year old was somehow able to get $6000 in a Roth (one time!) and earn 8% a year at age 66 he/she would have about $191,000. If that same 17 year old were somehow able to get $6000 a year until he or she was 23, (five years), and had the same 8% compounding until he or she was 66 there would be a nest egg of just under $1,000,000. That $1,000,000 would not be subject under current tax laws, to mandatory required minimum distributions (RMS;s) nor again under current tax laws would it be taxable income upon distribution.”

We hope you enjoy … talk to you in the summer!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
www.jkfinancialinc.com
www.street-cents.com

Back to Basics Fun Educational Review – Part Four – Retirement Planning … The Key – Start Early!

Welcome back to Part Four of our “Back to Basics” series .. we hope you’ve enjoyed the First Three which started with all about “The Emergency Fund” in Part 1 … with Part 2 being  “Protection Planning” and Part 3 discussing All about Debt Planning or “The Good the Bad and the Ugly of Debt” and now we happily bring you Part 4 Retirement Planning!

As a reminder this is a high level Financial Planning Education like overview starting with the basics of and we will continue into advanced topics in order of Planning Importance.  

Retirement Planning

The most important parts of retirement planning are very easy and as follows:

  1. Start Early
  2. Save as much as you can especially when you are young as compounding is your friend, do not worry about the amount, just save!
  3. Don’t overthink your investment options, just allocate as available and save save save…

Starting out with a healthy savings percentage of our earnings at an early age will lead to eventual maxing out of your retirement plans, forcing you happily into other savings vehicles thereby balancing your eventual portfolio with pre-tax retirement savings and after tax buckets of investments.

Continued high percentage earnings savings will also ultimately create the habits of not living on all that you are earning. This is especially important as we get closer to retirement and create just darn good habits.

There will likely be times in our lives when we may not be able to save as much on a percentage of our earnings as we would like, but constant top of mind savings habits will garner success in the long term, don’t let life’s curve balls distract your long term savings effort, you can do it!

Early savings should be very aggressive as the corpus of your savings are the actual savings component.  All equity type of investments especially during the first 5-10 years are not out of the realm of possibilities, again your continued contributions dominate the investment during these early stages.  As your retirement savings and for that matter other investments grow in size adjustments are necessary especially as we near retirement.

While there are talks of optimal retirement allocations, it’s not unusual to find inferior investment options in retirement accounts. Not to worry, don’t throw your employer or your plan under the bus … the most important item in your retirement savings program is the actual deferral of your hard earned work and the broad allocation! Be aggressive in the beginning and slowing down the allocation as it matures in size and our chapter nears retirement.

Weather 401, IRA, Sep- (Simplified Employee Pension), Roth.403b. 401A or any other retirement vehicle, the vehicle is not as important as participation!.

We will help you optimize from a tax standpoint which vehicle is best. and of course with the allocations as well!

Have a Great “Retirement Planning” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

jkfinancialinc

street-cents

March 2018 Podcast Video, Financial Planning and Capital Market Update – By John Kvale

Hello and Welcome to our March 2018 Financial Planning and Capital Market Update!

If you are too busy to read, feel free to listen as we describe our post and thoughts in friendly podcast format.

March 2018 Video

Financial Planning Tip (s) –

Final of FIVE Tax Savings Ideas you can do NOW for LAST Year’s (2017) TaxesUncle Sam

We completed the five part series … Three were let out of the box last month …. Let’s quickly review them and then the two final parts from this month!

HSA or Health Savings Account

Our post here, speaks of the terrific opportunity to set aside Pre-Tax dollars to use now or later for medical expenses.

SEP – Simplified Employee Pension

As mentioned in our Post Here, there are very high limits of contribution, and the SEP can be done during mandated RMD’s, as well as in tangent with a 401k program, as long as the upper limits collectively of contribution are not violated.

Pre-Tax Deductible IRA

As the one of the original retirement vehicles and so vintage many forget (We Don’t!) we want to remind here in our post about the IRA – Individual Retirement Account.

Tax Savings reach back reminders from THIS month/March

Maximizing the Sales Tax Deduction

Here in our post this month, we remind everyone to be sure and maximize your Sales Tax Deduction.

From the post …

Here are a few items that may make your standard sales tax deduction drastically inaccurate and woefully low- thereby costing you tax dollars:

  • Bought a large Asset – Think Car or other similar item
  • Had more then normal personal taxed expenses – for whatever reason
  • Large Taxable Asset of any kind purchased
  • Major expense where you paid sales tax – Think Wedding, Large Party

Be sure to maximize this deduction as it looks like the new tax rules will greatly mitigate it’s use moving forward.

Medical Expense Deduction

We all some type of medical expenses each year. What is a challenge if determining what is and is not deductible.

The IRS does a terrific job with their Publication 502 of reminding and outlining what may be a deduction. In our post here, we remind of a few favorites that we find are frequently missed …

  • Capital Expenses for home improvements
  • Transportation Cost
  • Television
  • Telephone

Are possible (check to make sure) deductions we find interesting and easily forgotten.

 

Capital Market Comments

Finding our Footing After Getting Ahead of Ourselves

 

Another month and our thoughts are the exact same…so much we did not even have to change the title of this part of the review from last month… the chart is updated … looks about the same…

We think patience is needed as this will take time to digest and again find our footing.

Patience will be needed!

Here is where we are now —

3-31-18 SPX w JK Trendline and 200 DMA

For those wondering …. for now, it looks like the 200 Day Moving Average (line below our trend line) is the lower level of support … It may break, which is fine, but for now, looks like someone wants it to hold.

We will keep watch and keep you updated!

Have a Great Day! Talk to you at the end of April!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
www.jkfinancialinc.com
www.street-cents.com

February 2018 Podcast Video, Financial Planning and Capital Market Update- By John Kvale

Hello and Welcome to our February 2018 Financial Planning and Capital Market Update!

If you are too busy to read, feel free to listen as we describe our post and thoughts in friendly podcast format.

February 2018 Video

Financial Planning Tip (s) –

Three Tax Savings Ideas you can do NOW for LAST Year’s (2017) TaxesUncle Sam

With the official kick off of Tax Season occurring some time in February … we are not sure what the “Official” start to Tax Season is, but we know it is sometime in February if not earlier .. haha

In an yet to be completed series – we still have two more parts, the first Three were let out of the box this month …. Let’s quickly review!

HSA or Health Savings Account

Our post here, speaks of the terrific opportunity to set aside Pre-Tax dollars to use now or later for medical expenses. In true Reach Back Tax Savings form, this contribution can be made now for last years taxes.

Be Careful though, you must make the contribution by the regular filing deadline i.e. No extensions to get the benefit applied to last year.

As mentioned above this account does not have to be used completely and can be delayed for highly likely future medical needs.

A handy trick we have used over the years when an employer makes some type of a contribution is to remind participants that in most cases you can make up the difference and get a tax savings.

Check with your Health Insurance Carrier to see if you qualify for an HSA contribution. If you do, we highly recommend you make the contribution.

SEP – Simplified Employee Pension

This beefed up IRA is another super Reach Back Tax Saver and the contribution can be made as late as your extended filing deadline.

The SEP offsets income that make come to you as non W-2. Think consulting, temporary work, as side business that generates income to you directly or any non W-2 regular pay.

As mentioned in our Post Here, there are very high limits of contribution, and the SEP can be done during mandated RMD’s, as well as in tangent with a 401k program, as long as the upper limits collectively of contribution are not violated.

Pre-Tax Deductible IRA

As the one of the original retirement vehicles and so vintage many forget (We Don’t!) we want to remind here in our post about the IRA – Individual Retirement Account.

Notice our careful heading of Pre-Tax Deductible IRA – We are not fans of the after tax IRA (contributing and not getting a write off) and in most case recommend you pass if you cannot deduct the contribution.

There are more limits to a Pre-Tax Deductible IRA under current tax laws, again be sure to see our post for limits and restrictions, but if you qualify, it is worth the savings as this is another “Reach Back Tax” saving idea.

Like the HSA, contributions must be made by the regular filing date- extensions do not  help you. So do not wait until the last minute.

Capital Market Comments

Finding our Footing After Getting Ahead of Ourselves

In a coincidental oddity, we had been putting the finishing touches on a post prior to the ugly 10% FAST FAST correction that occurred in late January and February.

In our post here, we spoke on where we may get back on trend- No one knows, of course, but simple logic of an unsustainable path was our analysis.

We think patience is needed as this will take time to digest and again find our footing.

Patience will be needed!

Here is where we are now — Our Trend line is looking pretty good – So Far.

3-1-18 SPX W JK trendline

 

We will keep watch and keep you updated!

Have a Great Day! Talk to you at the end of March!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
www.jkfinancialinc.com
www.street-cents.com

Tax Savings Ideas You Can Do NOW To Save Last Year (2017) Taxes – Part 2 – THE SEP – Simplified Employee Pension

Last week we started our tax season discussions here (- the HSA) with a favorite “Last Year” tax savings ideas that can be done this year …

This week another super saving idea … Think of this as an IRA on steroids – due to high limits and ample flexibility!

The SEP – Simplified Employee Pensionseptember-706937__340

Here are just a few reasons why we love the SEP for the correct situation:

  • Offset 1099 or other consulting like – non W-2 income in a pre-tax form
  • An IRA can be used to accept a SEP contribution in many cases – no new account needed
  • Can be used in conjunction with a 401k – Only need 1099 income – High Contribution limits apply
  • High Maximum Deferral amount $54k – yes that is correct FIFTY FOUR THOUSAND of pre-tax dollars as long as that is no more than 25% of Adjusted Gross Income
  • Can make SEP contributions even after RMD (Required Minimum Distributions) Begin
  • Can make your contribution even after the regular tax deadline if you file an extension – This really makes a SEP valuable and give us plenty of time to make the contribution again for LAST year’s tax savings

There are certain limitation and restrictions as mentioned, so don’t just make a contribution unless you are sure it will work for you … or just reach out to us!

Have a Great “SEP” Tax Savings Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
www.jkfinancialinc.com
www.street-cents.com

The SEP – Simplified Employee Pension – A Favorite Tax Deductible plan !

This week we bring you another tax strategy that may save you extra dollars, while not mandatory (or even recommended) before the end of the year – we thought it would go well with our year end tax savings series.

Recently in our end of the year tax strategies, we discussed the HSA ,visited Pushing Income , Optimizing Donations, and IRA Distribution, and the Roth Conversion  to maximize your tax deductions. This weeks topic is the SEP or Simplified Employee Pension !

If you have Non W-2 income, think consulting SEP IRAincome – a SEP can be used to make a deductible contribution against that income! 

THE SEP

  • Offsets Non-W-2 income
  • Can set aside 25% of the adjusted income – after expenses
  • High maximum of $53k in 2015 – careful with other plan integration- see next
  • Can be integrated with other plans- upper limits still exist
  • Invested in almost any asset – think of it as a super IRA because of the higher amount of contributions

Check with your tax professional or ask your tax software provider to “Maximize deductions” … Not to worry, we will remind again during tax season!!

Any questions– just reach out- we will be glad to help!

Have a Great — Less Taxable — Day!

John A. Kvale CFA, CFP

http://www.jkfinancialinc.com
http://www.street-cents.com
8222 Douglas Ave # 590
Dallas, TX 75225