Moving Business Shares Out of an IRA: Retirement Scan

Our daily roundup of retirement news your clients may be thinking about.

Moving business shares out of an IRA
A couple who bought a franchise business using money from their self-directed IRA was advised to pull the business out of the account as the rising value of the business means the couple will face a big tax bill in the future, according to this article on The Wall Street Journal. Mitch Reiner, an expert with Atlanta-based Capital Investment Advisors, advised the couple to buy the shares back from their IRA and change the company's ownership from a C-Corporation into an individual S-Corporation. “Because the upside of the equity value was so great, we wanted to get it outside the qualified plan so that the gains of the business would be taxed eventually at capital gains rates.”   --The Wall Street Journal

What to do when your financial adviser retires
As more financial advisers approach retirement, a transition plan is necessary to help clients adjust easily to younger advisers who will assume the job when the older advisers retire, according to this article on The New York Times. The transition may start two years before the advisers' retirement date, and clients are advised to ask the hard questions, particularly about the transition plan that their advisers have prepared for them. By doing so, clients are assured that their best interest will be protected during the transition process.  --The New York Times

A breakdown of how your Social Security tax dollars are spent
Although Social Security provides financial protection to lower-income retirees and their families, the program is designed to replace only about 40%, not 100% of their pre-retirement income, according to an article on Motley Fool. Here's the breakdown of how the Social Security Administration spends its revenue from payroll tax: 74% in retired worker benefits, 10% in survivor benefits, 16% in disability benefits, and less than 1% in administrative expenses. The figures show that the workers’ benefits account for 99% of Social Security tax revenue spending.  --Motley Fool

6 simple projects to make your home more retirement-friendly
People may consider modifying their homes that will make the structures more suitable for retirement living especially if they intend to make a major renovation and do not intend to move to another place, according to this article on Time Money. Removing walls between dining and living rooms, having curb-free showers, and redoing kitchen counters at standard height are among the things people can do to make their homes more retirement-friendly. The home will also be suitable for retirees if there are wide doorways, lever-style doorknobs, and high outlets.  --Time Money

Why workers undervalue traditional pension plans
Sixty-one percent of workers polled by Wells Fargo and Gallup Investor considered an employer-sponsored retirement plan to be the most important benefit next to healthcare, with 52% of the respondents preferring a 401(k) plan to a traditional plan. The plan is accessible to 70% of respondents, with 96% making regular contributions, according to survey results. Also, 86% of the respondents have plans that offer an employer match contribution, while 81% claim that the match is a big help in retirement saving, the survey finds.  --Time Money

Read More:

 
 

For reprint and licensing requests for this article, click here.
Practice management Financial planning Small business Client strategies
MORE FROM FINANCIAL PLANNING