This week, I'm tackling a question that's on the minds of many investors: How safe is your money with major brokerage firms like Fidelity and Charles Schwab? In light of recent high-profile bank collapses and widespread concerns about financial security, I discuss how banks and brokerage firms operate differently, what protections exist for your investments, and what would happen if a major brokerage firm were to collapse. Whether you're considering how best to safeguard your assets or wondering about the real risks of brokerage failures, this episode will provide the clarity and peace of mind you need for your retirement planning.

You will want to hear this episode if you are interested in...

• 00:00 Bank failures and investor concerns
• 05:58 Protecting your money in banks
• 09:18 Discussing investment safeguards
• 12:08 Brokerage account safety reassurance
• 13:08 Should you consolidate your broker accounts?

Why Investors Worry

It's natural for investors to worry about the safety of their money, especially after the events of 2023, when several banks—Silicon Valley Bank, Signature Bank, First Republic Bank, and Citizens Bank—collapsed, shaking public confidence in U.S. financial institutions. Even rumors and social media speculation about potential trouble at a major brokerage like Schwab can fuel anxiety among clients and investors.

How Banks Actually Work: Your Money Becomes the Bank's Money

When you deposit money in a bank, you're essentially lending money to that institution. The bank can then use those deposits to fund loans, mortgages, and other investments. This works well—until poor investments or insufficient collateral put depositor money at risk, which is exactly what happened with Silicon Valley Bank following its risky bets on long-term treasuries. If a bank collapses, customers may lose deposits above the FDIC insurance limit, which is $250,000 per account owner.

Brokerage Accounts: A Different—and Safer—Model

Brokerage firms like Charles Schwab and Fidelity operate under a different structure that provides a stronger layer of legal protection for client assets. Here's the key distinction: The assets in your brokerage account—stocks, bonds, mutual funds—are not the brokerage firm's property. They are held in custody, separate from company assets, and protected by a legal firewall.

If Schwab or Fidelity collapsed, only the company's assets—like buildings and offices—would be at risk, not the assets in client brokerage accounts. Those client assets are held in separate custodial accounts and cannot be used to pay the firm's creditors. It's a little like using a storage facility: you lock up your investments, and nobody (including the brokerage firm) can access those contents for its own purposes.

What Happens During a Brokerage Collapse?

If a major brokerage like Schwab were to fail, the Securities Investor Protection Corporation (SIPC) would step in. SIPC protection covers up to $500,000 per customer, including up to $250,000 in cash. However, most brokerages, including Schwab and Fidelity, carry additional insurance beyond SIPC requirements.

The SIPC acts much like a disaster relief agency: it verifies customer assets, ensures funds have not been misappropriated, and arranges to transfer accounts to another brokerage within days. The customer receives uninterrupted access to all their investments and holdings at the new firm.

Your Money Is Safer Than You Think

The legal and operational structure of brokerage firms offers significant protection. Even in the unlikely event of a collapse, your investments would transfer intact to another brokerage. The only real risk would be investment market performance—not insolvency of the brokerage firm. It's even unnecessary to split your assets between brokerages purely out of safety concerns—it might simply make your finances harder to manage.

Investor protections for brokerage accounts are robust. With legal safeguards, insurance protection, and established practices for handling firm failures, you can rest assured that your assets at firms like Schwab and Fidelity are secure—even in a worst-case scenario.

Resources Mentioned

• Retirement Readiness Review
• Subscribe to the Retire with Ryan YouTube Channel
• Download my entire book for FREE
• Securities Investor Protection Corporation (SIPC)
• Federal Deposit Insurance Corporation (FDIC)
• Fidelity
• Charles Schwab

Connect With Morrissey Wealth Management

www.MorrisseyWealthManagement.com/contact

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When it comes to planning for retirement, Roth IRAs have gained widespread attention for their tax-advantaged status and the promise of tax-free withdrawals in retirement. Financial experts, YouTubers, and podcasters have been touting the benefits of contributing to or converting assets into Roth accounts for years. But an often-overlooked vehicle could empower you to manage your investments just as efficiently: the humble taxable brokerage account. Surprisingly, with the right strategy, you can even pay 0% capital gains tax, mirroring one of the biggest appeals of a Roth.

You will want to hear this episode if you are interested in...

• 00:00 Overlooked benefits of after-tax brokerage accounts
• 02:29 Limitations of the Roth IRA
• 06:20 Tax implications of brokerage accounts
• 07:57 Tax benefits of growth stocks
• 13:14 Understanding Tax Brackets and Deductions
• 16:53 Inheritance rules for IRAs vs. brokerage accounts
• 17:44 Managing taxable brokerage accounts

Understanding Taxable Brokerage Accounts

A taxable brokerage account lets you invest in virtually anything: stocks, mutual funds, bonds, ETFs, and more. These accounts, however, are often dismissed when compared to their tax-advantaged counterparts because:

• Annual Taxation: Every year, you pay tax on dividends, interest, and any realized gains.

• Ordinary Income Tax on Short-Term Gains and Interest: Holdings sold within one year and earned interest are taxed at your regular income rate.

• Potential for Long-Term Capital Gains Tax: Sales after more than one year are taxed at the long-term capital gains rate, which is typically lower.

When used strategically, they offer flexibility and powerful tax advantages.

Making Your Brokerage Account Behave Like a Roth

The key to unlocking Roth-like benefits is understanding how and when taxes apply—and how to minimize them. Invest strategically and focus on growth over dividends. Choose investments that don't pay dividends, such as growth stocks or low-dividend index funds. No dividends mean no annual income to be taxed because gains are only taxed when you sell.

You can also use Index Funds and ETFs, which usually distribute minimal dividends and capital gains, keeping annual taxes low. Avoid open-end mutual funds in taxable accounts, as they tend to generate capital gains every year, eroding long-term growth with recurring taxes.

Realizing 0% Capital Gains

If your total taxable income (after deductions) stays within the 12% tax bracket—a figure that for 2026 is $50,400 for singles and $108,800 for married couples file jointly—you can sell appreciated assets and owe 0% in federal capital gains tax. It's wise to time withdrawals, plan major sales during years with little other income—such as early retirement or a gap year—to fall within the 0% bracket. Keep an eye on your other sources of income: IRA withdrawals, Social Security, and pensions count toward taxable income, potentially bumping gains into the taxable range.

Estate Planning Advantages

Taxable accounts also offer:

• Ability to Borrow: Take loans against your investments without triggering taxable events
• Step-Up in Cost Basis: Heirs inherit assets at their market value on your death, often eliminating capital gains on past appreciation—a feature that Roths don't fully replicate.

By understanding how to structure and manage your taxable brokerage account, you can access strategic flexibility—not just in managing withdrawals, but in transferring wealth to future generations. The "secret" is simply knowing and applying the rules, with tax-aware investing and withdrawal strategies smoothing the way for potentially tax-free wealth growth and transfer.

Resources Mentioned

• Retirement Readiness Review
• Subscribe to the Retire with Ryan YouTube Channel
• Download my entire book for FREE

Connect With Morrissey Wealth Management

www.MorrisseyWealthManagement.com/contact

Subscribe to Retire With Ryan

Variable annuities are often promoted as a secure way to generate guaranteed income during retirement, drawing the attention of retirees seeking stability for their nest eggs. But beneath the surface, these products frequently come with complications and costs that can erode your savings and limit your financial flexibility. In this episode, I share the details of the often-overlooked downsides of variable annuities and give you some important insights every investor should consider.

You will want to hear this episode if you are interested in...

• [03:14] What is a Variable Annuity?
• [04:27] Understanding Annuity Benefits and Growth
• [08:41] Lack of fee transparency in annuities
• [09:45] Variable annuity investment drawbacks
• [14:59] Avoiding variable annuity pitfalls

What Is a Variable Annuity?

A variable annuity is an investment product sold by insurance companies, offering a selection of investment accounts, referred to as sub-accounts, designed to mimic mutual fund performance. The tax-deferred growth inside the annuity is often touted as a major benefit. This tax deferral is redundant for retirement investors who already enjoy similar benefits in IRAs or 401(k)s.

Many variable annuities advertise living benefits, such as guaranteed lifetime withdrawals. For instance, a $100,000 investment could guarantee $5,000 per year for life, regardless of the contract's cash value. Some contracts offer guaranteed "growth" of your future income base, but crucially, this is not money you can cash out: it simply determines your withdrawal amount, not your walk-away value. The catch is that these appealing features come at a steep price.

Fee Structures are the Hidden Drain on Returns

One of the most significant drawbacks of variable annuities is their high-cost structure. These costs can be organized into three main categories:

• Mortality and Expense (M&E) Charges: Annual administrative fees imposed by the insurance company, typically ranging from 1% to 2% per year.

• Sub-Account Fees: Investment management fees that vary depending on your chosen investments. While some options are slightly less expensive, others can reach up to 2% annually.

• Rider Fees: If your contract includes a guaranteed income benefit, expect an additional 1%-2% per year for this privilege.

Combined, these expenses can easily total 3% to 4% annually, making variable annuities arguably the most expensive retirement investment around.

What You Don't See CAN Hurt You

Transparency is another major shortfall in the world of variable annuities. Many investors are not fully aware of the high fees they're paying. While the fees are listed in the prospectus, many advisors fail to highlight them, and statements often obscure these charges. Understanding true costs requires diligent reading of the fine print, and even then, variations in sub-account performance can lead to unexpected results. You may believe you're mirroring mutual fund returns, but annuity sub-accounts are not identical and can significantly underperform.

The promise of guaranteed income comes at a heavy cost. For the insurance company's guarantee to pay off, you'd generally need to either live well beyond average life expectancy or experience long-term poor market performance. Since withdrawal rates are limited and fees are high, over the long run, variable annuities may yield less retirement income or reduce the amount left to your heirs.

Look Beyond the Sales Pitch

Variable annuities can be marketed to highlight only the positives, but it's important to consider the high fees, lack of transparency, poor risk-return tradeoff, inflexibility, and opportunity costs involved. Before committing your retirement savings, do your homework—or consult a truly fiduciary advisor—and make sure variable annuities are the best fit for your long-term goals.

Resources Mentioned

• Retirement Readiness Review
• Subscribe to the Retire with Ryan YouTube Channel
• Download my entire book for FREE

Connect With Morrissey Wealth Management

• www.MorrisseyWealthManagement.com/contact

Subscribe to Retire With Ryan

This week, we tackle the alarming rise in financial scams targeting retirees and their hard-earned savings. With insights straight from the FBI and real-world examples of scam attempts, I break down the key tactics used by fraudsters and reveal the subtle ways they can gain access to your retirement accounts. From sophisticated account takeovers to fake invoice emails, you'll learn the warning signs to watch for—and, most importantly, practical strategies to protect yourself and your financial future.

You will want to hear this episode if you are interested in...

• [00:00] How financial scams work and what listeners can do to protect themselves
• [03:27] Recognizing scam tactics and risks
• [09:38] Recognizing fake invoice scams
• [10:36] Email scams and malware threats
• [16:30] Adding verbal passwords for security
• [17:28] Avoiding financial scams

Why Retirees Are in Scammers' Crosshairs

Retirees often represent an attractive target to scammers, thanks to years of diligent saving and sometimes less familiarity with new scam techniques. With the Federal Bureau of Investigation noting a surge in financial fraud, understanding the mechanics of modern scams is essential.

Scammers rely on a proven formula:

• Use of a trusted-looking sender
• Creation of a sense of urgency
• Sufficient believable details to seem legitimate

When you recognize these methods, retirees and their families can more easily spot fraud attempts and prevent the devastating loss of hard-earned assets.

Four Scams Every Retiree Needs to Know

1. The Account Takeover

Arguably, the most damaging scam involves fraudsters masquerading as your bank or investment firm. It starts innocuously: a text asks if you authorized a transaction. Replying prompts a phone call from a supposed representative. Thanks to massive data breaches, these scammers may already know your personal details — they just need one missing piece.

They'll convince you to read out a "security code" sent by your institution. Handing over this code gives the scammer direct account access, allowing them to transfer funds instantly. Importantly, because you authorized the transaction, financial institutions like Charles Schwab often won't reimburse the loss.

2. The Debt Collector Text Message

Here, you get a text from a "debt collector" referencing a fictitious account, amount, or government agency. Designed to provoke fear and haste, these messages trick recipients into calling the number provided or clicking a link — both of which compromise your security or lead to unauthorized payments.

3. The Unpaid Toll Notification

You receive an alert for a small, believable toll charge. With such a trivial amount, many people click the link and pay without thinking, handing over payment info to scammers who make larger, unauthorized withdrawals.

4. The Fake Invoice Email

Sophisticated emails may claim to be from reputable companies like Microsoft, complete with realistic logos and urgent language about an outstanding invoice. The danger here is twofold: opening the attachment can load malware or ransomware onto your device, or responding to the invoice sends money straight to a crook. Always verify the sender before clicking links or attachments.

Great Habits for Scam Prevention

This is my seven-point toolkit to keep you one step ahead of scammers. Practice these habits consistently to stay safe:

1. Slow Down: Scammers exploit urgency. Pause, breathe, and verify requests.
2. Don't Answer Unknown Numbers: Let unfamiliar calls go to voicemail, especially those spoofing local area codes.
3. Avoid Clicking Suspicious Links: Always visit official websites or use verified contact numbers when responding to alerts or billing issues.
4. Guard Your Personal Information: Never share sensitive info like PINs, passwords, or codes unless you started the interaction.
5. Use Authenticator Apps: These offer extra security beyond SMS-based codes, which can be intercepted.
6. Add Verbal Passwords to Accounts: Financial institutions often allow this as an additional security measure.
7. Assume It's a Scam: When in doubt, err on the side of caution and reach out to institutions through official channels.

Diligence is Your Best Defense

Scams will continue to evolve, but the best protection comes from vigilance and skepticism. Always vet instructions that involve your money, pause before acting, and confirm legitimacy through direct contact. Your savings represent a lifetime of work; protect them fiercely so they'll serve you for years to come.

Resources Mentioned

• Retirement Readiness Review
• Subscribe to the Retire with Ryan YouTube Channel
• Download my entire book for FREE
• Charles Schwab
• Fidelity
• Vanguard
• EPIC - Equifax Data Breach

Connect With Morrissey Wealth Management

www.MorrisseyWealthManagement.com/contact

Subscribe to Retire With Ryan

Retirement planning extends well beyond simply saving enough during your working years—it plays out with every decision you make once you stop working. One crucial, sometimes overlooked, aspect is managing Required Minimum Distributions (RMDs) from your retirement accounts. If you have a retirement account approaching your RMD age, this episode breaks down the essential rules based on your birth year, how to calculate your distribution using the IRS tables, and key tax implications to keep in mind.

You'll also get actionable tips to help minimize your future RMDs, from optimizing your income plan and leveraging Roth conversions to using qualified charitable distributions.

You will want to hear this episode if you are interested in...

• [00:00] RMD rules and calculations
• [05:10] RMDs and distribution timing
• [09:03] Retirement accounts and RMD rules
• [14:22] Tax strategies for retirement planning
• [17:00] Common RMD mistakes and solutions
• [19:21] Proper charitable distribution process

What Are Required Minimum Distributions (RMDs)?

RMDs are the minimum amounts you must withdraw annually from certain retirement accounts starting at a specific age, as mandated by the IRS. These distributions apply to traditional IRAs, rollover IRAs, SIMPLE IRAs, SEP IRAs, 401(k)s, 403(b)s, 457 plans, and profit-sharing plans. Importantly, Roth IRAs and Roth 401(k)s are exempt from RMDs, and regular taxable investment accounts are not impacted.

The required age for beginning RMDs now depends on your birth year:

• If you were born between January 1, 1951, and December 31, 1959, RMDs start at age 73.
• If born on January 1, 1960, or later, RMDs begin at age 75.

Tax Implications of RMDs

RMDs are taxed as ordinary income. If you're not careful, withdrawals can bump you into a higher tax bracket, increase how much of your Social Security is taxable, or trigger additional Medicare Part B and Part D premiums due to IRMAA. Failing to withdraw the required amount carries a steep penalty—25%, reduced to 10% if corrected within two years.

Strategies to Lower Your RMDs

Don't put all your savings in pre-tax accounts. Split between traditional and Roth accounts or invest some in taxable brokerage accounts, which aren't subject to RMDs. It can be useful to collaborate with a financial advisor to create a withdrawal strategy that minimizes taxes by pulling funds strategically from different account types.

You can also convert portions of your pre-tax accounts to Roth IRAs in years when your income (and tax bracket) is lower, helping "fill the bucket" at the lowest rates. If you retire early, delaying Social Security until age 70 increases your benefit and can create years of low taxable income—perfect for executing Roth conversions. If you're 70½ or older, you can also donate up to $100,000 per year directly from your IRA to a qualified charity. These gifts count toward your RMD but are excluded from taxable income.

Enjoying a Comfortable Retirement

Navigating RMDs isn't just about following IRS rules—it's an ongoing strategy to keep your taxes low and your retirement income steady. By understanding your obligations and using the available tools, you can maximize your retirement savings and create a more secure future.

Resources Mentioned

• Retirement Readiness Review
• Subscribe to the Retire with Ryan YouTube Channel
• Download my entire book for FREE

Connect With Morrissey Wealth Management

www.MorrisseyWealthManagement.com/contact

Subscribe to Retire With Ryan

Are you getting your full entitlement, spousal Social Security, or—like one of my recent clients—missing out on hundreds, even thousands, of dollars each year? This week, I discuss how spousal benefits work, what the eligibility requirements are, and the critical steps you need to take to ensure you aren't leaving money on the table. If you or your spouse are nearing retirement or already collecting benefits, this episode will equip you with the knowledge to maximize your Social Security income and avoid common mistakes.

You will want to hear this episode if you are interested in...

• [00:00] Spousal social security benefits
• [01:56] Criteria for receiving spousal benefit
• [02:25] Calculation of spousal social security benefit
• [07:26] Confusion when both spouses are eligible for their own and spousal benefits
• [09:46] Sue's social security increase
• [11:24] Misconception that adjustments are automatic

Understanding Spousal Social Security Benefits

If you are married (or divorced after a marriage of at least 10 years), you may qualify for spousal Social Security benefits. For those with limited earning histories or lower primary insurance amounts (PIA), this benefit is especially valuable.

At your full retirement age (FRA)—which is 67 if you were born in 1960 or later—you can collect up to 50% of your spouse's full retirement benefit, so long as your own benefit is less than half of theirs. If your own benefit exceeds half your spouse's, you'll receive your own larger benefit. Social Security will always pay the higher of the two benefits, but not both combined. This makes it vital to understand where you fall before claiming.

How Early Claiming Reduces Your Benefit

Timing is critical. Claiming spousal benefits before your FRA means your payments will be permanently reduced. The reductions work as follows:

• For the first 36 months before your FRA, your benefit is reduced by 25/36 of 1% for every month claimed early.
• Additional months over 36 are reduced by 5/12 of 1% per month.

For example, if a spousal benefit of $800 is claimed 36 months early, the amount drops to $600, a 25% reduction. If claimed 60 months early (at age 62), the benefit falls by roughly 35% to $520.

Key Rules of Spousal Benefit Eligibility

To receive a spousal benefit, several conditions must be met:

• Your spouse must be collecting their Social Security benefit (unless you're claiming divorced benefits, in which case your ex only needs to be eligible).
• You must be at least age 62 (or have a qualifying child under 16 or with a disability in your care).
• Generally, you need to be married for at least one year before applying, though this rule doesn't apply if you're the parent of your spouse's child.
• If divorced, you must have been married for at least 10 years.

Spousal benefits do not increase if you wait past your full retirement age to claim. The maximum is always 50% of your spouse's PIA. Delaying only increases benefits on your own work record, not on a spousal claim.

Spousal Benefits Are Not Automatic

One major pitfall couples face is assuming that spousal benefits "switch on" automatically when their higher-earning spouse starts collecting their benefit. In reality, the Social Security Administration often needs to be contacted directly to initiate the higher spousal benefit.

I share a case where a client (Sue) was entitled to a much larger benefit once her husband began taking Social Security at age 70, yet her benefit wasn't increased until she contacted Social Security, resulting in a missed $900/month for six months. Social Security would only issue six months of retroactive pay, meaning the client lost out on another six months of increased income. Don't assume the system will identify and correct missed benefits for you—it's up to you (and your advisor) to ensure you're receiving everything you've earned.

Resources Mentioned

• Retirement Readiness Review
• Subscribe to the Retire with Ryan YouTube Channel
• Download my entire book for FREE
• Social Security Fairness Act

Connect With Morrissey Wealth Management

www.MorrisseyWealthManagement.com/contact

Subscribe to Retire With Ryan

When many investors approach retirement, one of their most pressing questions is how their portfolio will generate the income needed to fund their lifestyle. It's a common belief, often repeated by financial pundits and well-meaning friends, that you should simply "live off the dividends" from your investments. It sounds appealing: a steady stream of payments, without having to sell any shares. Relying solely on dividend-paying stocks in retirement can create hidden risks and may not be the optimal path to financial security. I explore what it actually means to live off dividends in retirement, the benefits and risks of relying on high-dividend-paying stocks or funds, and why diversification might be a smarter approach for long-term financial security.

You will want to hear this episode if you are interested in...

• [00:00] Living on dividends in retirement
• [06:31] Dividend stocks vs market returns
• [09:04] How call options work
• [10:50] Considerations for income-focused funds
• [15:15] Discussing withdrawal strategy options

The Allure (and Limits) of Dividend Strategies

The appeal of a dividend-driven retirement portfolio is easy to see: pick companies with high yields, collect regular income, and (hopefully) never touch the principal. Using free tools such as Fidelity's stock screener, you can quickly assemble a list of stocks yielding 4% or more. But look closer, and several challenges arise.

High dividend-paying stocks tend to be clustered in a few sectors: real estate, consumer staples, healthcare, and energy. This concentration means your portfolio lacks diversification—the single most important factor in managing risk and smoothing returns over time. If these sectors hit hard times, both income and capital could suffer.

An Overlooked Consequence of Dividends and Taxes

Interest, dividends, and capital gains are all taxable (sometimes at favorable rates), but in a taxable (non-retirement) account, high dividend income can bump up your annual tax bill regardless of whether you need the cash. With a focus on capital appreciation, you retain more control: you sell as needed, and only pay tax on realized gains.

The Smarter Alternative is Total Return Investing

In my opinion, the better approach is a "total return" portfolio: broad diversification across stocks and bonds, targeting growth and income together, while managing risk. Bonds provide stability and income during volatile periods, allowing for stable withdrawals even if stocks temporarily decline.

Withdrawal strategies like the Guyton-Klinger guardrails model adjust withdrawals based on market conditions and keep your portfolio aligned with your longevity and inflation risks. Index investing, with its low costs and full market exposure, helps retirees avoid the sector pitfalls of dividend chasing while participating in overall economic growth.

Dividends can be a useful piece of your retirement income puzzle—but making them the sole focus of your portfolio can expose you to unnecessary risk, tax drag, and potential underperformance. Instead, construct a balanced total-return strategy. That way, you'll generate income, growth, and peace of mind—not just in bull markets, but in any market environment.

Resources Mentioned

• Retirement Readiness Review
• Subscribe to the Retire with Ryan YouTube Channel
• Download my entire book for FREE
• Fidelity Stock Screener Tools
• Schwab US Dividend ETF (SCHD)
• Schwab Total Stock Market Index Fund (SWTSX)
• JP Morgan Equity Income ETF (JEPI)
• Berkshire Hathaway
• AT&T
• Frontier Communications
• How To Get More Retirement Income Using Retirement Guardrails

Connect With Morrissey Wealth Management

www.MorrisseyWealthManagement.com/contact

Subscribe to Retire With Ryan

On this episode, I'm digging into the ins and outs of in-plan Roth conversions. You'll learn what it means to convert pre-tax 401(k) dollars to a Roth 401(k), who is eligible, and why it might make sense for your retirement strategy. I cover the practical steps for making these conversions, and highlight the benefits and drawbacks. I also share a real-life example of how a client navigated her options to maximize her retirement savings.

You will want to hear this episode if you are interested in...

• [00:00] In-plan Roth conversions
• [01:51] What is an in-plan Roth conversion?
• [02:38] Eligibility for in-plan Roth conversions
• [04:48] Real-life story of after-tax contributions in a client's 401(k)
• [06:07] Convert after-tax contributions plus gains within the 401(k) plan to Roth 401(k)
• [08:38] Rolling over after-tax contributions and gains to IRAs outside 401(k)
• [10:21] Preventing funds from sitting in a money market account

The In-Plan Roth Conversion

An in-plan Roth conversion allows participants to transfer funds from the traditional, pre-tax portion of their 401(k) into the after-tax Roth component of the same plan. This means you're taking money that has not yet been taxed and converting it into money that—after the conversion taxes are paid—will grow and can be withdrawn tax-free in retirement.

This strategy is different from Roth IRA conversions, which involve moving money from a traditional IRA into a Roth IRA, often at the same financial institution. In-plan conversions, on the other hand, streamline the process by keeping all assets within your employer-sponsored 401(k), offering simplicity and potentially access to preferred investment options.

Who Should Consider an In-Plan Roth Conversion?

In-plan Roth conversions can be especially valuable if you anticipate being in a lower tax bracket this year compared to future years, or if you want to build a tax-free income stream for retirement. Additionally, if you already have after-tax contributions in your 401(k), converting those funds can optimize your tax efficiency by ensuring that all future gains are tax-free.

Real-Life Example: Amy's Roth Conversion Journey

Let's look at the example of "Amy," who worked with me to create a financial plan. Amy had been contributing after-tax money to her General Motors 401(k), accumulating $63,000 in after-tax contributions and $40,000 in gains.

Here's how her options played out:

In-Plan Roth Conversion:

Amy could have converted both her after-tax contributions and the gains to the Roth 401(k). However, the $40,000 in gains would be taxable in the year of conversion, amounting to roughly $10,500 in taxes, or 26%. This would put her on track for approximately $200,000 in Roth assets in 10 years, assuming market growth.

Rollover to IRAs:

Alternatively, Amy chose to roll her after-tax contributions to a Roth IRA and the gains to a traditional IRA. This strategy avoided immediate taxation on the $40,000 in gains. The after-tax funds would grow tax-free in the Roth IRA, and future conversions of the traditional IRA can be planned according to her tax situation.

Amy's example highlights the importance of reviewing your plan's rules, weighing tax implications, and considering your long-term retirement goals.

Conversion Best Practices

If you have after-tax contributions in your 401(k), now is the time to develop a plan. Consider converting these funds sooner rather than later to maximize the potential for tax-free compounding growth. Some plans allow automated conversions, but others require regular follow-ups with your provider.

In-plan Roth conversions can be a powerful tool to improve your retirement outlook. By understanding your plan's rules, analyzing your current and future tax situations, and executing a smart conversion strategy, you can unlock significant tax advantages and peace of mind for your golden years.

Resources Mentioned

• Retirement Readiness Review
• Subscribe to the Retire with Ryan YouTube Channel
• Download my entire book for FREE
• Fidelity
• Charles Schwab
• Vanguard
• T. Rowe Price

Connect With Morrissey Wealth Management

www.MorrisseyWealthManagement.com/contact

Subscribe to Retire With Ryan

For many Americans, the idea of aging in place, or remaining in your own home as you grow older, represents comfort, independence, and familiarity. Most people understand the emotional benefits of remaining in a familiar environment, but often overlook the financial challenges, from home modifications and repairs to healthcare and in-home support, that could threaten their retirement savings. On the show this week, I break down the five key areas where your budget could take a hit and offer strategies to help you plan ahead, evaluate your options, and secure your ideal retirement lifestyle. If you're thinking about your future living situation or helping a loved one prepare, you won't want to miss this episode.

You will want to hear this episode if you are interested in...

• [00:00] The preference for aging in place

• [05:08] Home modifications for accessibility

• [08:28] Considering home maintenance and healthcare costs

• [13:32] Planning housing costs for retirement

• [14:55] Planning for future housing needs

Understanding Aging in Place

The reasons people want to age in place are clear: minimal upheaval, a sense of control, independence, and the emotional security of familiar surroundings. But it's common to underestimate what it actually costs to make this dream a reality. Many retirees fail to plan for the inevitable expenses, which can erode savings and force uncomfortable, last-minute decisions down the road.

Five Major Financial Considerations for Aging in Place

1. Home Modifications

A key prerequisite for staying at home safely is making your living space accessible. While some modifications—like installing grab bars or lever handles—may be relatively inexpensive, needs can escalate quickly. More significant updates, such as walk-in tubs, stairlifts, or ramp additions, can run into the tens of thousands of dollars. Even a basic stairlift installation can cost over $5,000, and major renovations like adding a first-floor bedroom or bathroom can easily be prohibitive, especially if done reactively in a crisis.

2. Maintenance and Repairs

Beyond mortgage payments, insurance, and property taxes, ongoing home maintenance is a substantial, often underestimated expense. Homes age just as their residents do, meaning roofs (with a typical 25-30-year lifespan), HVAC systems (lasting 10-15 years), and even electrical or plumbing systems may require expensive repairs. Consider getting a thorough evaluation of your home's current state and expected major repairs over the coming decades. Add these projected costs into your retirement budget so they don't catch you off guard.

3. Upkeep and Outsourcing Chores

When you first retire, you may be able to mow the lawn, shovel snow, or clean gutters. But as you age, these tasks may become physically challenging, if not unsafe, necessitating the hiring of help. The annual cost of landscaping, snow removal, and routine upkeep can add up, sometimes exceeding the maintenance fees of a condominium or senior community. Evaluate the true costs of outsourcing these chores over the long haul. In some cases, a housing alternative with built-in maintenance can be both safer and more cost-effective.

4. Medical and Healthcare Needs

Aging at home often means additional out-of-pocket expenses for home healthcare aides, nurses, and various medical equipment. Many necessities, such as medical alert systems or even prescription medication management solutions, are not fully covered by Medicare or standard insurance. It's essential to factor in potential costs for in-home care, equipment, and transportation to appointments should you lose the ability to drive.

5. Long-Term Care and Support

A frequent misconception is that Medicare will cover most long-term or in-home care needs. In reality, this type of care—particularly ongoing daily care—typically isn't covered, aside from certain short-term situations. Long-term care insurance is an option, but only a small percentage of Americans over 50 have it, often due to high premium costs. Given that full-time nursing care can cost as much as $180,000 annually in some regions, having a clear strategy for funding care, whether through insurance, earmarked savings, or asset liquidation, is critical.

Developing a Proactive Aging in Place Plan

To successfully age in place, start planning early. Assess your home's lifespan and the modifications needed, estimate maintenance and care costs, and integrate these projections into your retirement strategy. If the total costs seem unmanageable, now is the time to explore alternatives like downsizing, moving to a condominium, or relocating to a community with built-in support, especially in today's favorable seller's market.

Making these plans before a crisis ensures you'll have more options, less stress, and a better chance at maintaining both your independence and your financial security throughout retirement.

Resources Mentioned

• Retirement Readiness Review

• Subscribe to the Retire with Ryan YouTube Channel

• Download my entire book for FREE

• Planning to age in place? Watch out for these hidden costs. - MarketWatch

• Joint Center for Housing Studies of Harvard University

• AARP

Connect With Morrissey Wealth Management

www.MorrisseyWealthManagement.com/contact

Subscribe to Retire With Ryan

For many Americans approaching retirement, financial planning means more than just maximizing savings and deciding when to claim Social Security. If you're not yet eligible for Medicare and rely on health coverage through the Affordable Care Act (ACA), your Social Security claiming decision at age 62 could have a dramatic effect on your insurance costs. On the show this week, I explore the nuances of how your income, and especially the timing of your Social Security benefits, can impact your eligibility for ACA premium tax credits—and what you can do to avoid costly surprises.

You will want to hear this episode if you are interested in...

• [00:00] Retirement income and tax planning

• [03:35] Understanding ACA tax credits

• [07:44] Managing income for ACA tax credits

• [10:38] Social Security and tax calculations

• [14:57] Strategies for tax-free income access

Are ACA Premium Tax Credits, and Why Do They Matter?

Premium tax credits, often referred to as ACA subsidies, are financial incentives designed to make health insurance more affordable for individuals and families who purchase coverage through healthcare.gov or a state exchange. These credits are contingent on your income, specifically your household's Modified Adjusted Gross Income (MAGI).

For 2026, a single person can qualify for ACA subsidies if their MAGI is between 100% and 400% of the federal poverty level (FPL)—$62,600 in 2026 for an individual, and $84,600 for a couple. If you earn even $1 above this ceiling, you lose your entire premium subsidy—a phenomenon known as the "subsidy cliff". With millions of Americans currently receiving subsidies, understanding how your retirement income decisions could threaten this benefit is essential for sound financial planning.

How Income Is Calculated for ACA Subsidies

Not all income is created equal when it comes to ACA subsidies. The government uses your MAGI, which is your Adjusted Gross Income (AGI)—the number found on your tax return—plus certain items like tax-exempt bond interest and non-taxable Social Security benefits. This includes:

• Wages and self-employment income

• Social Security benefits (both taxable and non-taxable portions)

• Retirement account distributions (except Roth IRAs or Roth 401ks)

• Rental, interest, and dividend income

• Capital gains

Additionally, some deductions, like contributions to IRAs, HSAs, and student loan interest, can reduce your AGI, and thereby your MAGI, giving you potential tools for staying below the subsidy cliff.

The Social Security Timing Dilemma

Collecting Social Security early at age 62 may sound appealing, but it comes with strings attached for ACA recipients. A critical point is that not all of your Social Security benefits are necessarily taxable. However, when calculating MAGI for ACA purposes, you must add back even the non-taxable portion, which can push your income above the subsidy threshold. For example, if you take a modest IRA distribution and also begin Social Security, the cumulative MAGI could surprise you.

Strategies to Preserve Your ACA Subsidy

Given the high stakes, careful income planning is essential for anyone under 65 not covered by Medicare and receiving an ACA subsidy. You could delay Social Security, as waiting to claim benefits may help keep your income lower. You could also draw from Roth accounts or savings, withdrawals from Roth IRAs or 401(k)s—provided they're qualified—don't count as income. Likewise, using savings or HSA reimbursements has no impact on MAGI. IRA, HSA, and 401(k) contributions can reduce your MAGI, especially if you miscalculated and need to lower your income late in the year. The most important thing to do is plan withdrawals: Time your IRA or 401(k) distributions and capital gains so they don't coincide with years when you're dependent on ACA subsidies.

Avoiding the "Subsidy Cliff" Surprise

Perhaps the most important lesson is to monitor your income projections carefully throughout the year and to report your expected MAGI precisely when applying for coverage. Exceeding the threshold by even a small amount can cause you to lose your subsidy, resulting in thousands of dollars in unexpected premium costs come tax time.

Retirement planning requires a big-picture approach that balances income sources, tax implications, and healthcare costs. If you're considering Social Security at 62 and not yet on Medicare, pay close attention to how your income choices will affect your ACA subsidy—because when it comes to the "subsidy cliff," every dollar counts.

Resources Mentioned

• Retirement Readiness Review

• Subscribe to the Retire with Ryan YouTube Channel

• Download my entire book for FREE

• Episode 267: Surviving the ACA Subsidy Cliff

Connect With Morrissey Wealth Management

www.MorrisseyWealthManagement.com/contact

Subscribe to Retire With Ryan