Taxes are on Sale – Ep. 101

Our business is growing! We’ve grown each year of our existence and we are on track to continue that pattern this year. Thank you to those of you who have entrusted us to help you you’re your retirement planning.

We are growth minded, client focused, and desire to continue to serve new clients. Like most businesses, we were required to innovate during the COVID pandemic and fortunately, we came out of that situation stronger than we were.

In January, we leased additional office space at our current location. This was long overdue, as the extra space was much needed. In addition to the new office space, we recently hired a full-time administrative assistant named Doug Yates.

Doug is eager to learn the business and has already proved to be a big help with our office administration. You’ll likely hear from Doug in the future when scheduling meetings and with communication from our office. Additionally, he’ll help with client onboarding, office organization, and other day-to-day tasks.

Doug is a University of South Carolina Upstate graduate where he majored in Theatre Performance. We’re always in for a show with him! Doug spends his free time working around his house, designing board games, and attending the occasional theatre show at local stages around the Upstate. Pictured below Doug was playing Kilroy in the play “Don’t Drink the Water.”

We release a weekly podcast on Wednesday in conjunction with this newsletter. In future weeks, we plan to have Doug on the podcast along with myself to talk about questions people often have when it comes to retirement planning.

I’ve recorded a hundred podcast episodes over the last two years. I think you’ll find this resource helpful, as I’ve talked through many of the aspects of our business. To find our podcast on your smartphone, go to your podcast app and type in the search bar “Excel in Retirement.” Our show will pop up, or you can always go to ClientExcel.com/podcasts/ to listen. Amelia, our 4-year-old CEO, is pictured below checking our new office space out. 🙂

Here’s Our Tip for the Week

Taxes are on sale right now. We may have talked with you previously about how it may be a good idea to convert your tax-deferred accounts to tax-free Roth accounts. If you believe taxes will be higher in the future than they are today, then this may be a good idea. We are thirty trillion dollars in debt as a country and our unfunded obligations are fatiguing to consider. The writing seems to be on the wall that taxes will have to be much higher than they are today to continue funding our government.

We’ve been able to skirt this issue in the last decade because America has been able to print more money to buy bonds and equities. But we can’t even do that now, or at least not right now.

We printed too much money during the pandemic and it’s what’s causing our inflation issue. In order to tame inflation, the government is now increasing interest rates. Meaning, the government won’t be able to print more money to keep the wheels of industry turning or to make up its gap in funding. This means taxes are at an even higher likelihood of increasing than they otherwise were. Doug performing at USC Upstate below.

Now you may be scratching your head thinking “but why are taxes on sale?”

As of last Friday, the S&P 500 was down 18.14% for the year. If you have $500,000 in your 401k and it’s down 18.14% you now have $409,300.

When the market is down there is less to pay taxes on to convert to tax-free. At times, we may be able to create a situation for select clients where they will receive a bonus to enable them to make up some of their losses.

If you’d like to discover more about this, click here to schedule a 15-minute call with me.

Until next week,

David C. Treece,

Financial Advisor

864.641.7955
All investments are subject to risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values. Our firm is not affiliated with the U.S. government or any governmental agency. This content is provided for informational purposes only and is not intended to serve as the basis for financial decisions. Clients Excel is an independent financial services firm that utilizes a variety of investment and insurance products. Investment advisory services offered only by duly registered individuals through AE Wealth Management, LLC (AEWM). AEWM and Clients Excel are not affiliated companies. 01326488 05/22

Please remember that converting an employer plan account to a Roth IRA is a taxable event. Increased taxable income from the Roth IRA conversion may have several consequences including (but not limited to) a need for additional tax withholding or estimated tax payments, the loss of certain tax deductions and credits, and higher taxes on Social Security benefits and higher Medicare premiums. Be sure to consult with a qualified tax advisor before making any decisions regarding your IRA.