Tax Efficient Retirement Strategies

Planning a Tax-Free Retirement is NOW

If you are getting close to retirement or retired now, what are the moves that you should be doing to ensure that your retirement is as tax efficient as possible? If you think taxes are going up in the near future, you are in a situation where you need to explore a strategy to diffuse the ticking “tax time bomb” that is existing in your retirement accounts.

In this episode, I will share with you how you can analyze your tax situation and take advantage of the current window of opportunity and how we can control the tax environment.

In this episode, you’ll learn…

  • Chris’ positive focus for the week
  • Partnering with an Actuary 
  • The order of money conversation
  • Tax-free accounts
  • Cash Value Life Insurance
  • Taxable Money
  • Tax-Deferred Money
  • The reason why you cannot rely on pension only
  • Changes in the Social Security
  • Penalties on beneficiaries
  • Roth conversion strategy
  • Why does a person who is in retirement need insurance?
  • Death benefit doubles as a long-term care benefit
  • The Secure act and deferring paying taxes
  • Why the stimulus package that was just passed by the government can directly affect tax
  • The need to analyze your tax situation NOW.
  • This may be the last year to take advantage of the window of opportunity for low marginal tax bracket


  • No Compromise Retirement Plan
  • New Rules of Retirement Savings – We can send you a Free ebook (Electronic) copy!

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Episode Transcript:

This is The Chris Berry Show. Expert information on wealth, estate, and tax planning for the second half of life. Information that you can understand. Here’s your host, Chris Berry.

Welcome to the show, everyone. Of course, this is Chris Berry, and we’re going to start the show off with a positive focus like we do each week and today I’m going to share two of them. The first one is everyone’s safe and healthy in this crazy world in my family. So, of course, I feel happy about that. That’s a positive with everything going on in the world right now and then the second, and this is more of a professional one and one that I think the listeners will be interested in is that I’ve partnered with an actuary. An actuary is someone who calculates statistics for life insurance, that type of thing. Really a numbers guy.

I consider myself numbers person myself with my finance background before I got into law, but Marty is really a numbers guy and we’re having conversations with regards to this $2.2 trillion stimulus package that came out with the CARES Act and so what Marty and I have done is partnered on some resources, a couple of resources I have for you, and you can get these resources by going to retire-tax-free Again, retire-tax-free and one of those things that we did is we put together a webinar, specifically all about the $2.2 trillion stimulus package and what it means for your retirement.

Where do you think taxes are going to go? And we’ll talk about this today on the show and so most people given this think that taxes have to go up and so what are the moves that you should be thinking about right now to put yourself in the best position for now plus in the future and Marty does a great job of describing that. So we put together a webinar. We’re going to be running it a couple of times this week. So if you go to You can go ahead and register for a time that works for you and also one of the things that’s available is we have two books that we’ve partnered with Marty and his team.

One entitled The No Compromise Retirement Plan and this is a good one for those baby boomers out there who are near retirement or even retired and then another book called The New Rules of Retirement Saving and this is a book that I know a lot of people when I sit down with them and they see all their money sitting in these tax-deferred accounts they wish they read this book when they were younger and because understand that we have different places where we can save money and they wish they made some different choices and this book kind of outlines why it’s important to not just go with the tax-deferred, throw everything you can into a 401k or IRA, but maybe you should explore the different tax buckets and if you want any information or want us to send you, we can send you a free electronic copy.

Just shoot me an email at or feel free to give us a call at (844) 885-4200 and we can get you out a copy of that book as well as a link to the webinar that we’re putting on. So I’m pretty excited about that. So with that, I think it makes sense to talk about kind of some of the things that are going on, especially from a tax perspective. So I was going into 2020 with the idea that this would be a year of volatility. That was one big issue I saw coming in, but really the biggest thing was just the tax changes that were going on and this closing window of tax opportunity we have and the reason I say that is that in 2025, whether we like it or not, taxes are going up thanks to the tax cuts and jobs act.

So we have this window of opportunity of about five years and so this was something that we were banging the drum about coming into this year, and then low and behold, as we all know 2020 has been been a year for the ages, right? It’s a crazy way to start the new decade and so with this chaos that’s been going on in the outside world, what we’ve been doing is trying to help our clients get clarity and so it’s understandable that we’re a little apprehensive about making changes or moving forward, but understand if you don’t take action, that’s an action in itself and with everything that’s going on, that doesn’t change the fact that there’s probably some moves you should be looking at in your portfolio, in your savings from a tax perspective to take advantage of the current tax environment and then 2020 happen and then we passed another $2.2 trillion stimulus package.

So going into 2020, we’re already $23 trillion in debt and I’m like let that sink in for a second. $23 trillion that’s going to fund things like social security and Medicare and in the military and everything that goes along with running the government and then 2020 happens and now all of a sudden we’re passing another $2.2 trillion stimulus package, where we’re basically writing checks to everyone and at some point, we have to pay the taxes on this. At some point, taxes have to go up and so there are different strategies to think about in terms of getting to a more tax-efficient retirement, and first what I’ll do is I’ll start out talking about as you’re saving for retirement. So we’re going to talk about this chronologically.

So I’m going to first talk about as we’re saving for retirement, and this is some of the information in the book, The New Rules of Retirement Saving, which you can call us for a copy of that. I’ve partnered again with an actuary on that, who will be providing that but think about this if you’re still saving for retirement or even maybe have conversations with a son or daughter or family members who are still working, many years from retirement, and it’s the concept that there’s a certain order to money. That there are good money and money that’s maybe not as good. Not all money is good. I’ll take all money, but some money is a little better than other money and I call this the order of money conversation. So there are four types of money and the best type of money is free money. So this is money that’s free to you.

So you might be asking me, well, what’s free money? Well, that’s that employee or employer match. So if you’re working right now at a company that provides some type of match, you always pay the match or you always take the match. You always take the free money. So if they’re offering to say 3% match, you’ll always take that 3% match. That’s always a no brainer. So I always take the free money, but maybe you don’t overfund that 401K or IRA. Maybe you don’t put in more than the match because we want to create some diversification. So if your employer offers a match, you always take the free money. So that’s first, number two would be money that grows tax-free. So this is money that you’ve already paid the taxon, and this is money that’s going to grow tax-free.

So what would be examples of that? Well, examples of that would be a Roth IRA. So this is money that you’ve already paid the tax on, but now as you pull the money out or the money grows, it grows tax-free. So it’s taxed once, and then you’re done. Roth 401k, so some employers are offering a Roth 401k option and this is similar to a traditional 401K, where you can save in the employer-sponsored plan and the money that you save in there instead of the traditional 401K going in tax-free and when you pull it out you’re taxed. When you put the money into this, it goes in taxed and any growth, or when you pull the money out, it comes out tax-free. Another example of an account or type of asset that grows tax-free would be 529’s that have to be used for health, education, or health. I’m sorry, 529’s have to be used for education.

HSAs have to be used for health care needs, and then I’m going to present another option and this is one that’s not a lot of people are aware of and they have some misconceptions around this and so what I’m going to talk about is cash value life insurance. More specifically Index Universal Life. So you might be thinking of life insurance as well. That seems kind of odd as an investment vehicle or a growth vehicle to grow tax-free because when people think life insurance, they immediately think death benefit but life insurance has changed just like telephones have changed, right? When I was growing up a telephone… We didn’t have cell phones right away. When I was growing up, we had a landline and all you could do on that phone was call people, right.

Now, I’m holding a phone in my pocket that’s probably the thing I use it the least is actually a phone. Like if I hand this to one of my kids, they’re going to be Face Timing and going on Google and YouTube and all of that or asking Siri. The last thing they’re going to do is actually use it as a phone. Similar to life insurance, life insurance has changed due to the changing needs and now the death benefit that’s appealing, but it can do so much more than that. For example, I’ll share how I have life insurance in my portfolio. What I’ve done is I have two young kids who I’ve talked about on the show many times.

Ryan and Madison, and they’re right now nine and seven and so about 10 years away from college and so I’m saving for college and I’m putting money into two tax-free vehicles. I’m putting money into a 529 and the money in the 529 is going to grow tax-free, but it has to be used for education, and as the market goes up and down, so will that 529 accounts. The other place I’m saving is in an Index Universal Life insurance policy with a plan that in about 10 years, when my kids started going to college, I’m going to pull money out of the 529 and I’m going to be able to pull all that… Pull the money out of that life insurance policy that I’ve been saving and both are going to grow tax-free.

The difference is that with the Index Universal Life, it’s tied to the index where if the market goes up, I’m going to collect the upside of the market. If the market goes down, I’m not going to lose everything because of all the money I was saving in that 529, if all of a sudden we had a huge crash, which we’re all well aware that could happen then all of a sudden Ryan and Maddie, instead of getting four years of college are going to get two and so it’s important for me for them to go to college and I’m going to continue to place money into that cash value life insurance policy, that Index Universal Life insurance policy until I retire because all the money that I’ve put into that policy, I can take that money out tax-free. It’s tied to the index.

So the money I put in isn’t going to be lost to market losses and that death benefit that obviously with my young children is important now can double as a long term care benefit as I get older. So it’s checking a lot of boxes for me individually as part of my policy. So that’s just… I want to share that just as another tax-free growth option that sometimes people don’t think about and if you want to here’s something you can do. If you want some information on it you can give our office a call or you know what, there’s an interesting article that Jim Harbaugh when he was at U of M. One of the ways that U of M paid him was with a cash value life insurance policy.

So Jim Harbaugh even uses this as part of his planning as well. So it’s a little bit different. It’s not for everyone, but it is a nice way to give the option of tax-free growth but still building in the protections against market volatility. So that brings me to the third type of money, and this is taxable money. So this is money that as it grows, you’re going to have to worry about capital gains, which right now max is out at 20%. So this would be money sitting in like a checking or savings, CDs, which really aren’t earning much, but you get those 1099, the love letters from the IRS for these and then the fourth type of money is tax-deferred money and so we’re all well aware of what tax-deferred money is.

That would be things like IRA’s, 401k’s, 403B’s, these are things that you’re not taxed when you put the money in but when you pull the money out, you’re taxed on all of it. Where if you were to liquidate a $500,000 IRA all in one year, that would be $500,000 worth of ordinary income that you would have to pay and so as you’re saving, think about which of the buckets are you saving money for? And this is something that, that book The New Rules of Retirement Savings, I can send you an electronic copy of that. All you have to do is email me, or give our office a call. Again, contact at or give us a call at (844) 885-4200.

We can send you an electronic copy or you can go to retire-tax-free to watch a webinar talking about the current tax situation, but yeah, as you’re saving think about which bucket you’re saving for retirement because a lot of the times when I’m sitting down with people who are at retirement and we’re going from their accumulation plan, which is what people are doing when they’re working and saving to now preservation and distribution. I see a lot of regret in their eyes that all of their money was saved in tax-deferred accounts. That they have a large IRA and a home and that’s about it. They haven’t diversified their tax buckets, because think about it, if you were investing in the market and you had all your money in one stock, right.

           A lot of people will call that a little bit crazy. You’re not diversified, right. But if all of your eggs are in the tax-deferred bucket and taxes go up, guess what? You’re not diversified, and you’re going to face that tax risk and that’s something that as we’re going through 2020 with the CARES Act and this $2.2 Trillion stimulus package, everyone thinks taxes are going up. So if you leave your money inside of those tax-deferred accounts, the IRAs, the 401k’s, guess what? The government and the internal revenue service is coming after those accounts because they know that Americans have about $25 trillion sitting in those pre-tax accounts.

So as you’re saving, think about which bucket you’re saving in. Instead of over-funding that 401k maybe we look at contributing to a Roth IRA if that’s an option or contributing to a Roth 401k or Index Universal Life, one of the alternatives, making sure that you’re funding a 529 if you have kids in college is important. Health savings accounts. Looking at those tax-free accounts versus those tax-deferred accounts if you’re one of those people that think taxes are going up, and so stick with us as we continue this conversation regarding saving for retirement in a tax freeway and what to do as you’re near retirement.

Hi, we’re Madison and Ryan Berry.

Our dad is Chris Berry from the Castle Wealth Group.

The Castle Wealth Group used to be the Elder Care Firm, but dad wanted the company to be broader in its scope of services.

To not only protect and preserve assets, but to help people grow their assets to prepare for retirement.

As a certified elder law attorney and fiduciary financial advisor, our dad and his team at Castle Wealth Group can help you with lots of important things.

To tell you more, here’s our dad Chris Berry

Thanks Maddie and Ryan. Here at the Castle Wealth Group we can help you put together an estate plan to avoid probate. Work with you on a tax plan to keep more money for your family and less for uncle Sam and protect you against the devastating cost of longterm care. Our team is here for your family. I invite you to learn more about the Castle Wealth Group at our next free workshop, where you will learn the three steps to create a legal, financial and tax plan for the second half of life. Call us today to register at (844) 885-4200.

The Castle Wealth Group formerly the Elder Care Firm.

Learn more at the today.

So we’re talking about saving for retirement and the different ways that we can save or different tax buckets that we can save in. We can save in the tax-free, the taxable or the tax-deferred, and kind of the old way of saving, people relied on their pension and social security and just put everything into the tax-deferred bucket but for this next generation understand that we can’t really necessarily rely on those pensions. Those pensions are starting to go away. A very few people now that are working will have pensions when they retire and even those that are nearing retirement or retiring out, a lot of times they’re not even taking that pension.

They’re taking the lump sum buyout because of all the uncertainty with their companies. So if retirement is said 10 years out or longer understand that A pensions, you might not be able to rely on that. So we like to call this structural risk. So if you think of it as kind of three legs to your retirement income of social security pensions, and then your assets, well, the pensions have been knocked out. The second leg, social security, it’s still there. So if you’re collecting social security right now, I envisioned that you would continue to collect it, but I could see some changes coming along with regards to social security in the future for a variety of reasons.

First, understand why social security was created or when social security was created? It had played a very different role than it does now and that’s one of the reasons why if you check your social security statement. They say that unless changes are made by in 2034, they’re only going to be able to pay off 76 cents on the dollar. It’s because this isn’t what social security was meant for. I saw a recent statistic that said about 40% of America or 40% of retirement income for most Americans it’s made up of social security, but the way social security started, it was actually a longevity hedge. It wasn’t just an income stream for anyone that worked, it was a longevity hedge. Where the average or full retirement age for social security when someone retired was 65. The average life expectancy for someone at that time was 63.

So you’re supposed to pass away two years before you start claiming social security versus now for full retirement age is 67 or 66, depending on when you were born and average life expectancy for a male is I think 84 and a woman 87. So relying on social security if you’re saving for retirement right now, I wouldn’t put all my eggs in that basket either. So that’s the structural risk that’s going on right now as it relates to saving for retirement and it’s something that Marty Ruby, the actuary who wrote the book The New Rules of Retirement Savings, he does a great job of illustrating the structural risk of think of it as a stool and one leg of that stool to support your retirement is social security, which is a little bit wobbly.

The second leg is pensions. Those are going away, you can basically chop that one off and then the third one is your assets and it’s putting more responsibility on the saver to, first of all, save in the first place. So you do need to accumulate that wealth as you move into retirement but then choosing where to save and so that’s why I wanted to outline that order of money. Understand that it’s not just throw everything you can into a 401k and call it a day. Sure, take the employer match. That’s free money. You never turned down the free money, but anything over and above that, I would think about where you’re saving that and I would invite you to consider the idea that just throwing it into a tax-deferred account and not thinking about it might not be the best in your situation and if you want some help on this, one of the things we can even do is run some reports to show this to you especially given the fact that taxes are going up in the future and I guess that’s how I should have started out is ask you, do you think taxes are going up or down?

Because if you think taxes are going down then this would be a very different conversation and I’m talking about marginal tax rates across the board. If you think taxes are going down this would be a very, very different conversation. I’d have to switch that order around, but a majority of experts think that taxes have to go up and why is that? Well, we’re $25 trillion in debt as I talked about, we just passed another $2.2 Trillion stimulus package. We are currently at one of the lowest historical marginal tax rates ever in history. For example, when Ronald Reagan, you might remember him. If you remember, what was he doing before he was a president?

Well, he was an actor and when he was an actor, the highest marginal tax rate was actually 94% versus where we’re at now, it’s at 37%. Now what was going on during that time, we had conflict world war II and if you look back historically, all of the highest marginal tax rates have been during periods of conflict. So world war II 94%, Korea, Vietnam, 60, 70%, and then what have we been in since the ’90s conflict. So you had all of this up and it sounds like taxes have to go up in the future and understand that the government’s coming after those retirement accounts because they have $25 trillion in pre-tax dollars that have not been taxed yet.

So that’s why you see things like the widow penalty and you might be asking, well, what’s the widow’s penalty. Well, what happens is when one spouse passes away, you go from a married filing jointly tax bracket to now a single filing and that compresses the tax brackets. So for a lot of windows, they’re actually paying more in taxes than they were when they were married and that’s also affecting their social security and that’s affecting their Medicare premiums because all of this is linked together and then with the SECURE Act that just passed, and this was the big news coming into 2020, is that not only do widows suffer a penalty but now beneficiaries suffer a penalty too because prior to the SECURE Act when you retired and then started taking your RMDs at 70 and a half and then passed away.

If there’s anything pre-tax you’re leaving in the next generation, they could spread out those taxes over their lifetime but now the SECURE Act passed, they’re coming after those inherited IRAs where all the taxes have to be paid within 10 years. So understand that the Internal Revenue Service is coming after the widows. They’re coming after the beneficiaries and they’re coming after you and so that’s why if you look at these rising taxes that we all agree have to happen and are scheduled to, thanks to the tax cuts and jobs act. So understand taxes are scheduled to go up in 2025 about 3 to 4%. So if you’re at the 22% bracket, that’s going up to 25. If you’re at 24, that’s jumping 4% to 28%. So understand taxes are going up.

So if you’re in agreement with me that the tax train is coming, doesn’t it make sense to get some of the money off of the tracks? And so if you’re a saver, we have a great resource called The New Rules of Retirement Saving, partnered with an actuary to put that together and offer it to you. Just give our office a call at (844) 885-4200. Email us at or you can watch a webinar we’ve put together on this by going to So if you’re a saver, think about where you’re saving your hard-earned assets. Which tax bucket? Maybe it shouldn’t be all in that 401k. Maybe you shouldn’t over-fund that 401k. Take the free money, take the match, but the other savings maybe should be in tax-free vehicles like 529’s, health savings accounts, Roth, 401k’s, Roth IRA’s, and yes, even life insurance, which again, sounds crazy, but this isn’t the life insurance from the past.

The nice thing with this type of Index Universal Life is the cash value can accumulate, can grow tax-free. You can pull that out and you have more flexibility than say saving in a Roth as well. So now let’s switch gears a little bit and what if you’re in retirement now or very close to retirement then understand that we’re at a certain point, we can’t go back in time and when I sit down with people and we start talking about taxes, a lot of times they do say, gosh, I wish I had done things a little bit different from a tax perspective. So let’s say we’re near the end zone of retirement. We’ve climbed that mountain, we’re switching over from the accumulation phase of our life now to the preservation and distribution and I ask, well, do I have options? The answer is, yes, you do have options.

So even if you’ve done a majority of your saving, saving in those tax-deferred accounts, you’re coming in a majority of your wealth is in IRA’s, 401k’s and you say to yourself, well, there’s nothing I can do. There are things you can still do and the earlier we started thinking about this the better because really we have a window of opportunity right now from a tax perspective where over the next five years we might not be able to zero out the taxes will clear out your entire 401k or IRA, but if we can get you to a more tax-efficient retirement then that’s going to be more money for you and less money for the Internal Revenue Service. I’ll share another great resource, a book by a gentleman. His name’s David McKnight. It’s called The Power of Zero and it talks about getting to the 0% tax bracket.

Now, not everyone’s going to be able to do that. That’s for sure, but what I’m suggesting is trying to get to the most tax-efficient retirement possible and with Marty Ruby, we do have a resource called The No Compromise Retirement Plan that’s really geared towards individuals who are near retirement and they don’t want to suffer the compromises that a lot of people think that you do in terms of retirement, of what are your retirement options and it really looks at it from a tax perspective. He’s an actuary, so it’s a real numbers-driven. So if you’re one of those engineering types, you’re going to like this, but it’s the concept of what can you do when you’re near retirement to ensure that the rest of your life and what you’re leaving to the next generation is as tax efficient as possible and one of the things that we can do is if you’re curious of the strategies that are available in your specific situation, give our office a call at (844) 885-4200.

One of the things we can do is we can run a qualified account analysis to show you the different options to diffuse that ticking tax time bomb that’s sitting in your IRA’s or your 401k’s or your 403B’s. Because again, this is the biggest opportunity, and with everything that’s going on. The craziness in the world this message has kind of been drowned out a little bit, but understand you truly do have a limited window of opportunity to make some of these tax maneuvers and I’ll share what some of those options are. Because of the tax cuts and jobs act that’s expiring in 2025. So from now to 2025, there’s this tax window of opportunity where everyone if you think taxes are going up, which they are in 2025, should be analyzing how can I diffuse the ticking tax time bomb that’s sitting in my IRA or 401k and we have different strategies. Every situation, every family is a little bit different.

There’s no magic wand but first of all, it comes with understanding the order of money that I talked about. So we talked about the order of money. So what’s the best type of money, free money, right? But as you’re near retirement, you still should be taking that match. The second best is tax-free money. Third would be taxable and last, would be tax-deferred. So if you’ve accumulated a lot of wealth in that tax-deferred accounts, well, then we need to look at strategies to try to move that money out of that tax-deferred accounts to the taxable accounts or even the tax-free accounts and there are different strategies available. The most common one is a Roth conversion.

So a Roth conversion is basically taking money from that tax-deferred accounts, putting it over into the tax-free accounts. So take it from an IRA, moving that money over to a Roth IRA, and then paying the tax. Now all of that growth will grow tax-free, but you do have to pay the tax and the best way to do this… It’s not the only way, but the best way to do it is let’s say you have $500,000 in your IRA, and we want to do a $100,000 Roth conversion. Well, we’ll take a $100,000 dollars out of that $500,000 IRA and now put a $100,000 dollars into the Roth. So now at this point, you have 400,000 in your IRA, a 100,000 in your Roth that is now tax-free, but you might be asking, well, don’t, you have to pay the tax? Yes.

So this is where you would go to your taxable account. So like your checking, your savings, your brokerage, and pay let’s say 20 to $30,000 tax right there. So now you’ve lowered… So if you look at it kind of where from start to finish here, you had 500,000 in your IRA, you had zero in your Roth and let’s say 50,000 in checking and savings. Okay. The ideal way to do it would be to move 100,000 from that traditional IRA. Now you have a 100,000 sitting in the Roth 400 in the IRA and you’d pay the 20 to 30,000 out of that checking savings. The alternative is you could pay it as you move it but then you’d only have say 80 or 70,000 tax-free. We want to get as much tax free as possible.

So the most common way to get money into the tax-free account if you’re close to retirement or retired now would be to do a Roth conversion. Now I’m not saying to convert everything, maybe I am depending on the situation but there’s an intelligent way to look at it based on tax brackets and so this is where we have to have the numbers come into play and we have partnered with actuaries to be able to run those numbers on an individual basis. So if you want to give our office a call, we can calculate in your specific situation the ideal amount to convert and it’s going to be a little bit different for everyone, but that said we can run the numbers to develop a plan to figure out how much should we convert, how much tax, how are we going to pay the tax, and what’s the benefit of it as well. So stick with us as we continue this conversation talking about taxes in retirement.

Hi, Madison and Ryan Berry here from the Castle Wealth Group formerly the Elder Care Firm.

Our dad is Chris Berry.

He’s an attorney and fiduciary financial advisor, which means he helps families plan, protect and preserve their assets.

The entire team at the Castle Wealth Group can help you with lots of important things. To tell you more, here’s our dad Chris Berry.

Thanks Maddie and Ryan. Here at the Castle Wealth Group, we can help you put together an estate plan to avoid probate, work with you on a tax plan to keep more money for your family, and less for Uncle Sam and protect you against the devastating cost of long term care. Our team is here for your family. I invite you to learn more about the Castle Wealth Group at our next free workshop, where you will learn the three steps to create a legal, financial, and tax plan for the second half of life. Call us today to register at (844) 885-4200, (844) 885-4200 or visit us at

The Castle Wealth Group formerly the Elder Care Firm.

Learn more the today.

So we’re talking about taxes in retirement and as you get near retirement what are the moves that you should be doing to try to make sure that your retirement is as tax efficient as possible and again, we have some resources available and we can help you directly as well. If you wanted to go to partnered with an actuary to put together a webinar, talking about this $2.2 trillion stimulus package and what effect that has for your retirement. I have two resources, The No Compromise Retirement Plan and the other The New Rules of Retirement Savings. One geared towards those near or at retirement, one geared towards those saving for retirement, and we can get you a copy of those. Just give our office a call at (844) 885-4200 or email us at and we can get you a free copy of that or if you want to sit down and we can do this virtually as well.

If you want to see how all of these tax changes affect your specific situation, we have some reports that we take some basic information and we can show you from a numbers perspective what strategies are available and so I thought it would best to talk about… Let’s talk about an example or we’ll call it a fictional client. We’ll call him Mike and so let’s say Mike came into our office after listening to this radio show and he had saved as a lot of people had with all the money saved in that traditional 401k IRA and he’s 62 and is about to… He’s retired and he’s about to go claim social security, but after having a conversation, figuring out where Mike think taxes are going we made some changes and so instead of him running out to claim social security at 62 instead his plan is to wait until age 70 now, and you might be asking why is that Chris? Why wait till age 70, if you retire and social security is available, shouldn’t you just run out and take it?

Well, the answer just like a lot of these is that it depends on what your goals are and so I was talking to Mike and one of his goals was to get to the most tax-efficient retirement possible and also he was married and his wife was not working, had a much lower income during her life and so we talked about the need to maximize social security, not only for his life but also for his wife’s. So by waiting until age 70 what that does is allows your social security to continue to grow at roughly a percent per year. So at full retirement age, if you wait until age 70 to take social security, it’s going to be about 132% of whatever your full retirement normally would be.

So by doing this he’s allowing his social security to grow, but what he’s done is created an income gap, right? Because now he’s moving into retirement, paychecks are going to stop. He doesn’t have a pension. How is he going to cover his expenses? He has an income gap and so what we did is we put together a strategy to use his assets to cover that income, pull money from the IRA to cover his expenses. So that allows his social security to grow but also what does this do? Well, because he’s retired because he’s not claiming social security from a tax bracket standpoint, it creates a lot of space for him to pull money out of these pre-tax accounts when he’s at a lower tax bracket to cover his expenses and then what we did is we looked at his tax bracket and over the next five years, we’re going to figure out what is the optimal amount to do a Roth conversion or move money from the tax-deferred bucket to the tax-free.

So what we’re doing with this fictional client is that we’re pulling money from his large IRA, because he was one of those classic just throw everything into the tax-deferred account, but we’re pulling money from the large IRA and now half of the savings are… Pulling money from the large IRA, that’s covering his expenses. So he knows that he’s going to still have his expenses covered. He can still do what he wants and travel and everything like that, and then also we’re pulling money from the IRAs not only covering expenses but also we’re putting it in two different tax-free savings vehicles. We’re putting some money into the Roth. So we’re doing Roth conversions and then some money is going into it Index Universal Life.

So yes, as a 62-year-old this fictional client Mike, purchased the Index Universal Life insurance policy. Now you might be asking, well, why would someone who’s near retirement want insurance? Again, this is a new form of insurance. This isn’t… Similar to a telephone. In the past telephone all, you could use it was to make a phone call. Now if I hand that telephone to one of my kids, that’s the last thing they’re going to do. They’re going to play games or go on YouTube or FaceTime one of their friends, right? To understand things change and so with this new Index Universal Life, the money that he’s contributing to it will grow tax-free so that when he does reach 70 or 72, he can start taking that money out as a tax-free growth vehicle but also you might be the death benefit, right? What about the death benefit?

Well, the thing is the death benefit will double as a long term care benefit. So that $500,000 a death benefit he has doubled as a long term care benefit to help pay for home care, help pay for assisted living or help pay for nursing home care. So understand that there is going to be a payoff. We have tax free income coming from it. We have a death benefit that also doubles as a long term care benefit so that by the time he reaches 70 and 72, he’s defused that ticking tax time bomb and all of this is going on during that huge window of opportunity we have now from now till 2025 and again it’s an opportunity and this window of opportunity is closing and going into this year, I said we had til 2025, but with all the changes going on with the government writing stimulus checks to everyone and the $2.2 trillion stimulus package that just passed, maybe we don’t even have till 2025. Taxes could go up as soon as next year, especially we’re going into an election year, you never know what’s going to happen.

So that’s why Marty and myself we put together this webinar that you can watch from your home and all you have to do is go to the website and right there you can register for the webinar that we’re showing airing a couple of times this week. So again, go to You can watch that webinar at your computer, on your Apple TV if you have that kind of hookup, you can watch it in your own privacy of your own home and if you do want to see how this information applies to your situation feel free to give us a call at (844) 885-4200 and just ask for a qualified accounts report. We’ll need some information from you, but we can see how with this a tax opportunity that we have we can see how it would affect your situation, and really it starts off with the answer to the question and I can’t answer it for you. I can give you my opinion. I can tell you what a lot of other experts think, but do you think taxes are going up or down in the future? It’s really that simple.

If you think taxes are going up, then you need to consider some of the strategies of how do we get money out of the tax-deferred accounts and that’s where we look at doing things like Roth conversions. We look at just paying the tax and putting it in a qualified account or a nonqualified account, just paying it and putting in a taxable account. Alternative approaches of looking at cash value life insurance, as a way to get more bang for your buck, because if you think taxes are going up then you need to explore some type of strategy diffuse that ticking tax time bomb that’s existing in your retirement accounts, in your IRAs, your 401k’s, and understand that… I guess maybe this is my personal bias, but the government doesn’t always have our individual best interests at heart and you see this with things like the SECURE Act when that passed.

They passed the SECURE Act and they pitched it as Oh, well, now you don’t have to take out your RMDs from 70 and a half to 72. Well, when in fact it might be in your best interest to pull money out of those IRAs. I thought it was kind of a tricky thing of okay, we’re going to pass this bill call it the SECURE Act to quote-unquote protects your retirement, but really what it was doing is securing the government’s future because first of all, they want you to defer paying taxes because when you’re defer paying taxes, what are you doing? You’re growing a tax bill and now you might be thinking, well, I love seeing that big pre-tax amounts in there, but understand you also have a big tax liability there as well and one of the things that when I’m doing in-person workshops or webinars or talking to clients is that we go… Sometimes they have this misconception that well, I would rather have a $100,000 pre-tax than $80,000 tax-free because you think, well, the growth on the $100,000 now that’s going to be more but understanding you’re growing a bigger tax bill.

So if we agree that let’s say a 20% tax rate and you have a $100,000 pre-tax, $80,000 post-tax, and both accounts grow 10%, understand you’re also growing your tax liability. So it ends up being exactly the same but if you think taxes are going up then you need to move money from that tax-deferred account to allow it to grow tax-free, and that’s where we look at the different strategies and do it in an intelligent manner. Again, I’m not advocating everyone who’s listening right now should rush out liquidate the IRA and throw it into a Roth or something like that. I’m not, but what I am advocating for right now is that you need to analyze your tax situation. I know there’s a lot of things going on in the world, but this is something that really there truly is a window of opportunity where we’re going to be right now, where one of the lowest marginal tax rates ever in history and so doesn’t it make sense to try to save 3 to 4% in taxes, right? That’s more than what you’re earning on CDs right now, right? And we can’t control what the market’s going to do and we certainly see that right now but we can take control of the tax environment.

We can take control of that tax question and really it falls to in terms of strategies, what is your time horizon? So how far out are you from retirement? If you say five to 10 years or longer, then think about where you’re saving your money. Are you putting all your money into a 401k? Are you over-funding that tax-deferred account? Maybe you should look at alternatives like 529’s, HSAs, Roth 401k’s, Roth IRAs, Index Universal Life. Those are all options that are available for people who are more in the accumulation phase. Again, where are you going to accumulate that wealth? Are you going to accumulate it where you’re in partnership with the Internal Revenue Service for your whole life or do you want to accumulate that wealth somewhere where it’s tax-free?

And then let’s say you’re less than five years away from retirement or already retired. What are the things that you can do now if you’re one of those people that bought into the defer, defer, defer as long as possible? Well, and again, don’t beat yourself up over it. Like that’s what it was beaten into our head is just defer, defer, defer. That’s what everyone told us as we’re saving for retirement. So don’t beat yourself up if you fall in that category, but understand you do have options moving forward to diffuse that ticking tax time bomb not just for you, but for your spouse as well and then also for your loved ones and beneficiaries. Because at the end of the day if we can leave more money to our loved ones and less money to Uncle Sam again, my personal bias is I think that’s a pretty good deal.

So maybe it makes sense for us to explore different strategies especially with the passing of the SECURE Act, the tax cuts and jobs act and now the CARES Act that just passed recently with us $2.2 trillion of additional spending when we’re already $23 trillion in debt as a country. So again, that’s why I worked together with an actuary to put together a webinar. You can attend it by going to So that’s or you can give our office a call. We can get you that information. Give us a call at (844) 885-4200. We are open, we are an essential business and we have been helping our clients through this craziness we’ve all been experiencing or you can shoot us an email at

If you want to get started on putting together a tax efficient retirement and legacy plan. We do have a system in the process to be able to help you do that. We don’t even have to meet face to face. We can do this through webinars and online meetings and phone calls and we do have a secure site to share information. So if you do want to get started on figuring out how to make your retirement as tax efficient as possible and we’ve put together plans to get people to the 0% tax bracket. That sounds crazy but there are ways to do it. If you do want to get that process started again, give us a call (844) 885-4200. We’ll schedule a short phone call to get to know each other, make sure we’re a good fit and then we can start working together, and again please visit A free webinar that’s set up just for you where we talk about that $2.2 trillion stimulus package.

I brought on an actuary who again is a numbers person. These are the people that are calculating life expectancy and that type of thing. So similar to a CPA and you can make all the CPA or actuary jokes you want, but a really brilliant person and very important and again, it’s so important to understand that there’s a window of opportunity here that yeah, there’s a lot of craziness in the world. It might be uncomfortable to make moves or make decisions right now, but this window of opportunity from a tax planning standpoint is slowly closing.

Prior to this year, I said we had till 2025, guess what? This has been a crazy year. We just had the CARES Act that just passed another $2.2 trillion worth of spending. We might not even have till 2025. This could easily be one of the last years where we’re at this historically low marginal tax bracket because if there’s a change in governments this year, the other side gets in chances are our taxes are going up. So take advantage of that window opportunity to give us a call (844)885-4200. This has been Chris Berry. Make it a great week. Take care.

Learn more about Chris Berry and how he can help your family by visiting online at the That’s the You can also call Chris Berry at (810) 355-2584. That’s (810) 355-2584. This program content reflects the opinions of Chris Barry and his guests not the Elder Care Firm, Prosperity Capital Advisors, or The Castle Wealth Group, and is subject to change at any time without notice. Content provided herein is for informational purposes only, and should not be used or construed as investment or legal advice or as a recommendation regarding the purchase or sale of any security or to follow any legal or tax strategy.

There’s no guarantee that the strategist’s statements, opinions, or forecast provided herein will prove to be correct. Past performance is not a guarantee of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses, which would reduce returns. All investing involves risk, including the potential for loss of principal. There’s no guarantee that any investment plan or strategy will be successful. We recommend that you consult with a professional dedicated to your needs. This program is furnished by the Elder Care Firm.

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