The Retirement and IRA Show

By Jim Saulnier, CFP® & Chris Stein, CFP®Business Investing

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The Retirement and IRA Show episodes

October 31 HSA PSA, Survivor Benefits, Roth Conversions, Inherited IRAs: Q&A #2644
Jim and Chris discuss listener emails, starting with a listener PSA on HSA contributions and Medicare Part A, then cover Social Security survivor benefits, a Roth conversion rules follow-up, and moving an estate’s IRA into Inherited IRAs.
(8:00) George shares a PSA on an often-overlooked Medicare Part A consideration for anyone still contributing to an HSA after 65.
(19:15) A listener asks if there’s any truth to an article on Social Security survivor benefits. Specifically, if someone who started their own benefits at 65 must wait until full retirement age to collect 100% of their survivor benefits, and whether claiming early will reduce them.
(28:00) The guys revisit the Roth conversion example from Q&A #2640 in response to a question on whether the extra money deposited into the Roth IRA from a brokerage account would be an excess contribution.
(36:15) Jim and Chris tackle a question about an IRA that ended up with no named beneficiaries after an advisor moved it to a new account before the owner’s death. The question is whether the private letter rulings (PLRs) cited in an article can be relied on to transfer the IRA from the estate into Inherited IRAs without a taxable event.
The post HSA PSA, Survivor Benefits, Roth Conversions, Inherited IRAs: Q&A #2644 appeared first on The Retirement and IRA Show.
1 hr 5 min
October 28 Ready to Retire?: EDU #2643
Chris’s Summary
Jim and I use two listener emails in this EDU dialog episode to consider whether each couple may be ready to retire. The first couple weighs relocating for taxes, a pricier next home, and all-equity portfolios with RMDs looming. Longevity, inflation, and a supposed $10 million target also come up. The second email involves a Social Security claiming plan, with a closer look at how spousal benefits and the earnings test work. We also discuss their options between monthly pension payments and a lump sum, along with some considerations around Roth conversions.
Jim’s “Pithy” Summary
Chris and I take a look at a couple of retirement scenarios based on listener emails in this EDU dialog episode. The first couple, 66 and 60, is trying to figure out if they’re ready to retire, and they’d like to pull the trigger now. The couple is thinking about leaving Oregon in a year or two, haven’t picked where, and taxes seem to be driving the decision. Don’t let the tax tail wag the dog, folks! Their next home will likely cost more than their current one, and we talk about why the idea that you have to downsize in retirement isn’t always right. We also discuss what 100% equities looks like when you do the mental accounting across the whole portfolio, and why RMDs looming in six years should have them asking an important question. Then there’s the longevity and inflation worries, and how the Minimum Dignity Floor ties into both. The last sentence of their email made me go, “huh.” They feel they’re far from the illustrious $10 million mark. I don’t know where they got that number, but we’ve seen people with less than a million live comfortably, and people with four, five, six million projected to run out because of how they spend.
The second emailer, age 61, has a Social Security claiming plan that we dig into, and Chris adds some clarity on spousal benefits and the earnings test. He’s also choosing between monthly pension payments and a taking a lump sum. Chris pulls an income annuity quote for comparison, while I explain why pension risk transfer and the term “state guarantee fund” may change the picture. We also weigh his plan to convert about half of their traditional IRA money to a Roth in the first few years after he retires to fill the 10% or 12% tax bracket, and how charitable giving can change the picture.
The post Ready to Retire?: EDU #2643 appeared first on The Retirement and IRA Show.
1 hr 26 min
October 24 IRMAA, Medicare, Spousal RMD, HSAs, Life Insurance: Q&A# 2643
Jim and Chris discuss listener emails on choosing a life-changing event for an IRMAA reduction request, declining Medicare Part A to keep making HSA contributions, the hypothetical retroactive spousal RMD rule, using HSA funds for pre-65 health premiums, and using guaranteed universal life insurance as a tax-efficient inheritance.
(10:30) George asks if it matters which qualifying life event he selects on Form SSA-44, since two apply, when requesting a reduction in IRMAA. He also wonders whether the adjustment is still avoided if 2027 modified adjusted gross income (MAGI) comes in higher than estimated but stays under the first married filing jointly bracket.
(22:00) A listener inquires whether someone over 65 can decline Medicare Part A when starting a Social Security survivor benefit in order to keep contributing to a health savings account (HSA).
(44:15) The guys get a request to explain the purpose of the hypothetical retroactive spousal RMD rule for IRAs and to walk through the example from a recent EDU episode more slowly.
(57:45) Jim and Chris respond to a note saying that retirees who stay on their former employer’s health plan can use HSA money to pay premiums before age 65.
(1:01:30) A listener seeks guidance on using a guaranteed universal life insurance policy to tax-efficiently pass an inheritance to trusts for two adult children.
The post IRMAA, Medicare, Spousal RMD, HSAs, Life Insurance: Q&A# 2643 appeared first on The Retirement and IRA Show.
1 hr 31 min
October 21 Little-Known IRA Rules, Part 1: EDU #2642
If you would prefer to skip Jim and Chris’s banter about Jim’s garden greens and his trip to Nashville, Indiana you can skip to (12:00).
Chris’s Summary
Jim and I discuss little-known IRA rules that trace back to the IRS final regulations released in July 2024. The rules covered include how an older eligible designated beneficiary may calculate RMDs, a spousal RMD that is both hypothetical and retroactive, and the documentation requirement for see-through trusts. Some of these changes simplify the rules, while one adds complexity.
Jim’s “Pithy” Summary
Chris and I start into a list of little-known IRA rules that I put together from my old Ed Slott notes, and the three we cover all trace back to what the IRS did in July of 2024. Most of them involve beneficiaries, because that is where IRAs stop being basic and start getting confusing. Remember, when you hear the words designated beneficiary, throw them out of your brain and put in the word human. We start with an eligible human who inherits from someone younger, and I put Chris on the spot with a true or false. He gets partial credit, and that IRS decision explains why.
That same release also created the hypothetical retroactive spousal RMD. Hypothetical. It’s not real. It never happened, yet it may still land on a surviving spouse who moves an inherited IRA to their own. That name is a mouthful, so I walk through examples, including what changes when the spouses are different ages and what the IRS means by “first applicable year.” It’s easy to forget, yet forgetting it can cause real trouble.
We also get into see-through trusts. Trusts are pieces of paper, and trusts don’t die, so the IRS set parameters a trust has to follow before it will treat one like a human. I go through them, and on the beneficiaries my advice is name names. Then there is a documentation rule the IRS made simpler in that same release, but not for every type of account. Why that is, I still can’t tell you. If you have an explanation, I’m all ears.
The post Little-Known IRA Rules, Part 1: EDU #2642 appeared first on The Retirement and IRA Show.
1 hr 16 min
October 17 COBRA, Social Security, Pension Deferral, Annuities: Q&A #2642
Jim and Chris are joined by Tom Stivers for a couple questions on COBRA coverage for a younger spouse and Social Security survivor benefits and the RIB-LIM rule. Jim and Chris continue on without “Grasshopper” for a listener PSA following up on the Chip and Dale/Chippendale banter from a previous episode and questions on pension deferral past RMD age, insurer service after inheriting a 403(b), single premium deferred annuities (SPDAs), and the timing of annuity purchases as financial understanding declines with age.
(16:15) George follows up on a recent episode’s COBRA discussion, noting that a non-Medicare spouse is limited to 18 months of coverage when the qualifying event is retirement at 64.5.
(26:45) A listener asks for an explanation of the Retirement Insurance Benefit Limit (RIB-LIM) and wonders whether, after both spouses claimed at 62, a surviving spouse would receive the higher earner’s monthly benefit or something more.
(40:30) The guys receive a PSA following up on the Chip and Dale/Chippendale banter from a previous episode, explaining the history of the names and which came first.
(44:45) A pension recipient wonders whether a pension office is correct that the deferred portion of a pension held in a 401(a) can stay deferred past age 73 while RMDs begin, as a way to remain in the 24% tax bracket.
(57:45) Jim and Chris revisit an earlier question about a delayed 403(b) inheritance, as the follow-up asks why anyone would buy an annuity from an insurer that struggled to process a simple inheritance.
(1:13:30) Georgette wants to know whether a five-year, 4.4% single premium deferred annuity (SPDA) purchased with funds from an IRA was a good move and what to consider when it matures.
(1:26:15) A longtime DIYer asks whether waiting until a Minimum Dignity Floor shortage arrives to buy an annuity conflicts with the goal of the younger self protecting the older self.
The post COBRA, Social Security, Pension Deferral, Annuities: Q&A #2642 appeared first on The Retirement and IRA Show.
1 hr 42 min
October 14 Stretch IRA Eligibility: EDU #2641
If you would prefer to skip Jim and Chris chatting about fall weather in Colorado and Ohio, Jim’s upcoming trip to Nashville, and country music, you can skip to (11:30).
Chris’s Summary
Jim and I look at stretch IRA eligibility after the SECURE Act and who now qualifies as an eligible designated beneficiary. We start with why naming a beneficiary matters, then trace how the stretch was assembled from the Keogh Act, TEFRA, and IRS regulations before SECURE curtailed it. From there, we define the five categories still allowed to stretch, how the date of death determines eligibility, and how IRAs and employer plans treat disability and chronic illness certification differently.
Jim’s “Pithy” Summary
Chris and I take a deeper dive into eligible designated beneficiaries, something that seems benign but isn’t as straightforward as it sounds. What a lot of people don’t realize is that Congress never created the stretch IRA. It was stitched together like Frankenstein from two different acts and separate IRS regulations, and it got so ingrained that it took a specific act of Congress to greatly curtail it. Under the old rules, if a 1-year-old inherited an IRA, it could stay open for 80-plus years. But Congress wanted to get money out of IRAs sooner rather than later for the tax revenue so the rules changed.
Think of the Black Knight from Monty Python, gravely injured but still doing its best to carry on. Congress wounded the stretch IRA, but they didn’t kill it. What survived is the eligible designated beneficiary, or eligible humans, and there are 5 categories still allowed to stretch. Some we go through wicked quick. Others send us down little rabbit holes.
We dig into stretch IRA eligibility questions like does the IRS accept common-law marriage? Do stepchildren and foster children count as a minor child? And why can one day before an 18th birthday change how disability is defined? Then there’s the question of how a beneficiary proves they’re disabled or chronically ill. The IRS waived some of the certification requirements, but it didn’t treat IRAs and employer plans the same way. I don’t get why that is, but I share Ed Slott’s theory on it.
The post Stretch IRA Eligibility: EDU #2641 appeared first on The Retirement and IRA Show.
1 hr 14 min
October 10 Social Security, Milestone Ages, HSAs, Roth Withdrawals, Annuity Providers: Q&A #2641
Jim and Chris discuss listener emails on Social Security first check timing at age 70 and child-in-care spousal benefits, additional milestone ages and HSA contribution PSAs, Roth withdrawals under the Rule of 55, and finding annuity providers with good customer service.
(11:30) A listener asks whether Social Security benefits started in the month of a 70th birthday should arrive the following month, or only after the first full month at age 70, as the Social Security Administration explained.
(19:45) The guys field a question on whether a spouse can collect a child-in-care spousal benefit for caring for a stepson who became disabled at 21 and receives Supplemental Security Income.
(27:30) Jim and Chris share a PSA that 120 is a milestone age worth noting, since that is when the life expectancy factor used for most RMDs stops decreasing each year.
(34:30) Georgette notes that each spouse’s $1,000 HSA catch-up contribution must go into their own HSA and wonders whether Roth withdrawals of growth qualify under the Rule of 55 or must wait until 59½.
(43:15) The guys share another PSA pointing out that Rule 72(t), which allows penalty-free IRA withdrawals before 59½, is another milestone worth adding to the recent Retirement Milestone Ages episode.
(49:15) A fellow CFP® clarifies that Medicare enrollment, not age, ends HSA contribution eligibility, so someone working past 65 without Medicare can keep contributing, including the $1,000. catch-up.
(58:15) Jim and Chris address whether any annuity providers offer solid customer service.
The post Social Security, Milestone Ages, HSAs, Roth Withdrawals, Annuity Providers: Q&A #2641 appeared first on The Retirement and IRA Show.
1 hr 34 min
October 07 Single Life Pension Tradeoffs: EDU #2640
Chris’s Summary:
With Jim traveling, I’m joined by the newest member of the Jim Saulnier & Associates team, Tom Stivers, to review an email from a listener couple who both chose a single life pension, with term life insurance on the higher earner. Their situation raises concerns about Social Security claiming ages, their Minimum Dignity Floor catching up to income if their pensions lack a cost-of-living adjustment, health insurance before Medicare, Roth conversions, and a potential need for a long-term care plan.
Jim’s “Pithy” Summary:
While I’m traveling, Chris brings in Tom Stivers, a newer member of our team, to work through a longer listener email that doesn’t fit a Q&A show. George and Georgette both took their state education pensions without a survivor benefit. George has the bigger pension, so he bought a term life policy to age 78 to help replace his income if he dies first. Chris admits the hair went up on the back of his neck the moment he saw a single life pension, and it went up again at the word “term”. Tom zeroes in on that word too, because almost none of us know the date we’re going to die. But the rest of the email does change the picture.
They believe they might be unicorns, and with $191,000 of secure income once George claims Social Security at 70, against $110,000 of spending, you can see why. Chris pictures it as a race: income starts way out ahead, but spending keeps slowly catching up, and their pensions likely have no automatic cost of living adjustment. Tom also spots a sneaky line about Georgette’s health insurance before Medicare. George thinks Roth conversions matter for taxes and IRMAA. Georgette isn’t worried and doesn’t want to pay the taxes now. And when Chris asks whether conversions should stop once Social Security starts, Tom answers with a question: what’s your 2-1-0 Tax Ordering Number?
And then there’s what the email never mentions: a long-term care plan. Chris explains why their savings may not stretch as far as it sounds if one of them needs care, and why secure income that continues for the survivor can matter. He points out people can obsess over decisions that barely move the needle while missing the ones that do.
The post Single Life Pension Tradeoffs: EDU #2640 appeared first on The Retirement and IRA Show.
1 hr 16 min
October 03 HSA Catch-up PSA, Social Security, IRMAA, Roth Conversion, Annuity Timing: QA #2640
Jim and Chris discuss listener emails, beginning with a listener PSA on HSA catch-up contributions at age 55, then cover Social Security spousal benefits when claiming before full retirement age, paying IRMAA with HSA funds and the SSA-44 form for IRMAA appeals, whether a Roth conversion counts as a 60-day rollover, and annuity timing as interest rates fall.
(6:45) A listener shares a PSA noting that HSA holders age 55 and older can contribute an extra $1,000 per year until they reach Medicare age, and a spouse can do the same in their own HSA.
(22:00) The guys get a question on whether claiming Social Security at 65 still allows a spousal benefit of half their spouse’s higher benefit, or whether that requires waiting until full retirement age.
(27:15) Georgette asks whether IRMAA surcharges can be paid with HSA funds, following a prior episode’s mention that Medicare Part B and D premiums qualify.
(32:30) A listener seeking IRMAA relief after a spouse’s retirement payout wants to know which year belongs in section 2 of the SSA-44 form.
(45:00) Jim and Chris are asked whether a Roth conversion is treated as a 60-day rollover subject to the once-per-365-days limit.
(1:05:45) A listener who has attended several annuity sales presentations wonders why Jim doesn’t buy his planned annuity now and turn on the income later if payout rates are likely to keep dropping.
The post HSA Catch-up PSA, Social Security, IRMAA, Roth Conversion, Annuity Timing: QA #2640 appeared first on The Retirement and IRA Show.
1 hr 32 min
September 30 Retirement Milestone Ages: EDU #2639
If you would prefer not to learn about Jim’s upcoming drive to Ohio and the family change of plans also sending him to Massachusetts, you can skip to (10:00).
Chris’s Summary
Jim and I walk through retirement milestone ages, from age 21, when a minor child beneficiary’s stretch gives way to the 10-year rule, through catch-up contributions, penalty-free withdrawal ages, Social Security survivor and retirement claiming ages, the IRMAA lookback at 63, Medicare at 65, QCDs at 70½, and RMDs at 73 or 75. We also cover an obscure age 75 RMD rule for pre-1987 403(b) contributions and the age 85 limit for starting a QLAC.
Jim’s “Pithy” Summary
Chris and I work through a list of retirement milestone ages I’ve been holding onto for a while, and the first stop, age 21, is a deep one. Folks, the stretch IRA is the Black Knight from Monty Python and the Holy Grail. It’s gravely wounded, but it’s not gone. A minor child of the deceased IRA owner, an eligible designated beneficiary, or as I call it, an eligible human, can still stretch until 21. Then the 10-year rule applies, and Chris and I guessed wrong on what happens next. I checked with the Ed Slott Group, and the answer comes down to one phrase: at least as rapidly.
Then we hit catch-up contributions at 50, including a new Roth rule this year that some listeners call a loophole. I don’t. We cover the carve-out that lets public safety employees skip the 10% early withdrawal penalty at 50, and the rule of 55, including a strategy the IRS has implicitly blessed. And then there’s the super catch-up. Folks, I have no idea what Congress was thinking. An extra $3,250 a year in your 60s is not going to fix anybody’s retirement. Let people in their 20s and 30s put more in, where it can compound. Chris brings in the Social Security and IRMAA ages, including a disabled surviving spouse rule that taught both of us something new.
At 70½, QCDs can help at the margins when a big RMD threatens an IRMAA tier. I make Chris guess an obscure age 75 rule tied to 403s, and he earns a B+. Then he pulls out one I totally missed at 85: QLACs. I give Treasury credit here, not Congress, and I explain why we’re a little softer on QLACs than on other deferred income annuities.
The post Retirement Milestone Ages: EDU #2639 appeared first on The Retirement and IRA Show.
1 hr 41 min

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What do you get when you combine two knowledgeable CFP® PROFESSIONALS (one also a well-informed COLLEGE FINANCE INSTRUCTOR)? If you mix in relevant financial information and a healthy dose of humor…