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September 2021 |
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PAST ISSUES |
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Advisor News Insight
AFRs |
FACTS |
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REQUIREMENTS |
BEST CE
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INDUSTRY NEWS
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IRA Planning
IRA Trustees Wipe Out an Inherited IRA — Their Own
By
Ed Slott, President of
Ed Slott and Company LLC.
A lifetime of accumulation and growth goes up in smoke because the
beneficiaries don’t know the IRA trust tax rules. Advisers can help
their clients avoid such colossal blunders.
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Retirement Planning
Guaranteed Income: A License to Spend
By
David Blanchett,
Head of Retirement Research, DC Solutions at
QMA LLC. and
Michael S. Finke, Professor and Frank M.
Engel Chair of Economic Security at
The American College.
This study explores how the composition of retirement assets is related to retirement spending and find that retirees who hold a higher percentage of their wealth in guaranteed income spend
more than retirees whose wealth consists primarily of non-annuitized assets. Marginal estimates suggest that investment assets generate about half of the amount of additional spending as an equal
amount of wealth held in guaranteed income.
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Making Sense of the 401(k) Multiple Plan Limits
By
Ed Slott, President of
Ed Slott and Company LLC.
There are actually two different contribution limits –
the “deferral limit” and the “overall
limit.” This makes things very confusing, especially
if you’re in multiple plans at the same time or you change
jobs in the middle of the year.
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Present Law and Background Relating to Retirement Plans
The Joint Committee on Taxation has released its publication,
“Present Law and Background Relating to Retirement Plans,” on
July 26, 2021.
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Social Security Planning
Social Security: The Windfall Elimination Provision (WEP)
This Congressional Research Service (CRS) Report explains how the
windfall elimination provision works, who it affects, and describes
legislative proposals to eliminate or modify it. Updated July 26, 2021.
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Tax Planning
COVID-19 Tax Relief Added to Increasing Share of Households Paying No Income Tax
By
Garrett Watson, Senior Policy Analyst at
Tax Foundation.
The Tax Policy Center (TPC) released estimates on the portion of households with
no federal income tax liability, finding that in 2020, about 60.6 percent of households
did not pay income tax, up from 43.6 percent of households in 2019. Much of the 2020
increase was due to pandemic-related factors.
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FACT SHEET: The Build Back Better Agenda Will Provide Greater Tax Fairness for Small Businesses
A White House fact sheet outlines President Biden’s tax proposals which include raising the corporate
income tax rate, implementing a minimum tax on corporate book income, and permanently extending the expanded
child tax credit, among other measures.
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Substantially Equal Periodic Payments
IRS updates FAQs for substantial Equal Periodic Payments. This page from the
IRS website answers questions about the exception to tax under Code section 72(t).
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Practice Management
Representative Barred from FINRA for Cheating on CE
By
Jacqueline Sergeant,
Communications and Multimedia Professional at
Financial Advisor.
According to a recent FINRA disciplinary actions notice, a registered representative from
Montpelier Virginia was barred from any FINRA member in all capacities for using an “imposter”
to take his continuing education courses for him. While leniency was requested, FINRA confirmed
that the “standard sanction for using an impostor in the Regulatory Element is a bar.”
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Three Must-Have Components to a Sustainable Referral Process
By
Michelle R. Donovan, Referral Coach and Business Consultant at
Productivity Uncorked.
How long have you been searching for the silver
bullet of referrals? You’re not alone. Financial
advisors have been searching for decades. I’ve been
coaching on the topic of referrals for nearly 20 years.
Everyone has an opinion on everything, including referrals.
Unsurprisingly, there is no silver bullet, and you will discover
some methods are ineffective.
What I’ve realized is that advisors want a referral process that
works and is comfortable, sustainable and repeatable. Facing off with
clients at the end of a review meeting with a referral request makes
everyone squirm.
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Young Financial Advisors Need a Niche
By
Kristen Luke, Founder of
Kaleido Creative Studio.
Niche marketing is the path to success for younger advisors,
who can naturally develop marketing strategies based on sharing
their expertise. Firm owners should coach their younger advisors
and, in the process, groom the next generation of leaders.
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ASSUMED FEDERAL RATES (AFRs)
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§7520 Rate for September is: 1.0%
Break down:
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FINANCIAL FACTS OF THE MONTH
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Are You Wealthy?
Source: Charles Schwab Corporation. Charles Schwab 2021 Modern Wealth Survey.
The average response from 1,000 Americans surveyed in the first half of
2021 is that it takes a net worth of $1.9 million in order to be considered
“wealthy” in the United States today.
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Death
Source: NBC News, Meet the Press: First Read
The first American death from the COVID-19 pandemic occurred on 2/06/20.
As of 9am ET on 8/06/21, i.e., 18 months later, 619,158 Americans had died
from the pandemic, an average of 7,938 deaths per week. 3,273 Americans died
of COVID-19 in the last week.
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Happened Earlier than Expected
Source: Schwartz Center for Economic Policy Analysis
Between March 2020 (i.e., the beginning of the global pandemic) and
June 2021, 1.7 million more Americans retired from the workforce than
would have normally retired if historical trends had continued.
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Largest Drop Since World War II
Source: Centers for Disease Control and Prevention (CDC)
The combination of hundreds of thousands of deaths due to the spread of COVID-19, opioid overdoses and a surge in
murders in the US in 2020 saw the country’s average life expectancy drop 1.5 years to 77.3 years in 2020, the largest
such drop since World War II.
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Living Long
Source: CDC
US life expectancy at birth was 60.8 years in 1921. US life expectancy at
birth was 77.8 years in 2021. Thus, life expectancy has increased by a year
every 6 years over the last century.
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Not Just Kids
Source: Federal Reserve Bank of New York
19% of Americans that have outstanding student loan debt from
college are over age 50, i.e., 8.7 million borrowers out of 44.7
million total borrowers.
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Only Once
Source: US Department of Labor
Inflation, using the “Consumer Price Index” (CPI) as the measurement, was up +5.4% on a
trailing 1-year basis as of 6/30/21. In the last 30 years, there was only 1 month when trailing
1-year inflation was greater than +5.4%. Inflation was up +5.6% for the 1-year ending 7/31/08.
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Stocks and Politics
Source: BTN Research
In the last 60 years (1961-2020), the S&P 500 has been up +17.5% per year (total return) under a
Democratic President and a Republican-led Congress, nearly 4 times the +4.5% annual return achieved
under a Republican President and a Congress controlled by the Democrats. The stock index gained +11.8%
per year when the White House and Congress were controlled by the same political party, as is the present
situation in Washington in 2021. When the House and the Senate were controlled by different parties (regardless
of which party is in the White House), the S&P 500 has been up +11.3% per year.
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That Would Be Nice
Source: Mary Johnson, The Senior Citizens League
Social Security retirement benefits are projected to increase +5.3% in 2022,
a “cost of living adjustment” (COLA) that would be its largest since 2009. The
actual COLA bump will be announced in October 2021 by the Social Security
Administration.
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Taxing and Spending
Source: Congressional Budget Office (CBO)
The Congressional Budget Office (CBO) forecasted on 7/01/21 that during fiscal year 2021, i.e., the 12 months ending 9/30/21,
the US government will receive $3.8 trillion of tax revenue, spend $6.8 trillion, resulting in a $3.0 trillion fiscal year deficit.
During the next 10 fiscal years, i.e., fiscal year 2022 through and including fiscal year 2031, the US government is projected to
receive $51.3 trillion of tax revenue, spend $63.4 trillion, resulting in a $12.1 trillion deficit over the next decade.
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The High Cost of Care
Source: Center for Retirement Research at Boston College
12% of US retirees, i.e., 1 out of 8, will spend at least 4 years in a nursing home.
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ADVISOR TOOLS
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2021 Federal Income Tax Guide
Our Tax Guide contains tax information such as:
- Individual income tax rates
- Estates and trusts tax rates
- Roth IRA contribution limits and much more...
Download the Tax Guide below:
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2021 Social Security & Medicare Reference Guide
Our Reference Guide contains information such as:
- Social Security income limits
- Medicare Parts A-D deductibles and premiums
- Medicare surtaxes and much more...
Download the Reference Guide below:
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Financial / Insurance Calculators & Websites
An extensive list of online calculators and informational websites.
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REQUIREMENT UPDATES
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View updates by state, CE requirements and more by clicking on the link below.
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BEST CE PROGRAMS
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Online CE Courses
At BEST we provide you with a lot of CE credit. Courses are
cost-effective, updated annually and nationally approved for
state insurance and professional designation credits
(CFP, CIMA, CPWA and RMA). Our CE courses are specifically
designed for quick completion and include:
- Self-paced courses
- Unlimited retakes of review questions and final
examinations
- Instant grading
- Course material accessible for up to six (6) months
from date of purchase
- Excellent customer support team
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CFP/CIMA/CPWA/RMA Ethics CE 2-Hour Live Webinar
“Ethics CE: CFP Board’s Revised Code and Standards:
Ethics for CFP Professionals”
(CFP Course#: 277681 | CIMA/CPWA/RMA
Course#: 21BEST011)
Earn two (2) credit hours of CFP and/or CIMA, CPWA and RMA Ethics CE with NO EXAM!
(“Investments & Wealth
Institute® has accepted this CFP Ethics webinar for
2 hours of CE credit towards the CIMA®, CPWA® and
RMA® certifications.”)
WEBINAR DOES
NOT INCLUDE STATE INSURANCE CREDIT!
*PAYMENT OPTIONS:
- CFP ONLY license: $49.00
- CIMA, CPWA AND RMA ONLY license: $49.00
- CFP WITH CIMA, CPWA AND RMA licenses: $49.00 plus an
additional fee of $25.00
NOTE: Attendees MUST participate in all exercises and polling questions during the webinar.
Credit received for attendee time logged and participation, NO EXAM at end of webinar.
(A $10.00 cancellation fee will apply for all refunds requested.)
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Self-Study CE Course List
As a top-notch continuing education provider we:
- Deliver CE to financial and insurance
advisors
- Offer up‑to‑date and industry pertinent CE
courses that maximize credits
- Provide ClearCert certified long-term care
and annuity training CE courses
- Supply CE courses that are approved in all
50 states and the District of Columbia
Order
CE courses toll free at: 1-800-345-5669 OR send an
email to
self_study@brokered.net.
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DISCLAIMER
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INFORMATION
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