IRA Owners – No RMD in 2009

The IRS recently announced that IRA holders who are age 70 ½ or older will not be required to take an RMD (Required Minimum Distribution) in 2009.

You may (as always) take withdrawals up to 100% of your account. All withdrawals must be reported as taxable income. You may or may not pay federal income tax (PA residents do not pay state income tax) depending on your federal tax bracket. If your cash flow requires withdrawals you should continue on that course.

If your cash flow does not require withdrawals to meet your living expenses you might wish to skip your RMD this year to give your IRA investments the opportunity to rebound. In either event, this is an excellent time to review your IRA investments. You should determine an appropriate investment strategy and use the highest quality assets you can find. We provide free portfolio reviews should you wish some help with this assessment.

It isn’t often the IRS gives us some options.

Make sure you choose the RMD option that’s right for you.

Bernie Madoff - Made Off with $50 Billion
Could Your Advisor Make Off with Your Life Savings?

Maybe.

Madoff is being accused of bilking hundreds (maybe thousands) of investors (real people, foundations, companies, charities, the list goes on and on) out of more than $50 billion. Many of these people were very smart, very successful, and very savvy - and they got taken to the cleaners. What chance does an average joe have?

Pretty good actually. Take three steps to protect your investment accounts:

- Work with an advisor you trust - if you're not one hundred per cent sure - get out of there
- Only allow your assets to be held by a third party custodian (Schwab, Pershing, Fidelity, etc.)
- Confirm (regularly - by phone or on-line) that your funds exist in the amounts and assets you expect

If you want a no cost review of your accounts and a

New Year - New Investment Resolutions

The two biggest mistakes investors make are:

Wrong investment allocations
Wrong financial advisors

And these two are often directly related. In fact, if you employ the wrong financial/investment advisor you almost certainly suffer with the wrong portfolio allocations.

The right financial advisor for you is the one you trust. The right advisor listens and crafts a plan to meet your specific goals. The right advisor communicates with you well and often. The right advisor is flexible enough to make course adjustments during your journey. If you have the right advisor, it is very likely you have the right (or nearly right) allocations.

It's not enough to just have lots of baskets for your eggs - they must be the right baskets - and you must put the right eggs in the right baskets - and you must balance out the baskets to keep on an even keel. Fortunately, with today's available research and technology a good advisor can do all of this for you and more. If you are a do it yourselfer (bless you!) there are a number of excellent on-line resources to help you get the same investment advantages - you just have to do all the work yourself - and hope you got it right!

If you need help with your allocation or a check up on your current advisor - let me know.