by Elizabeth4TC | Jun 21, 2019 | Comments Off on Truth Tip, State Taxes in Asset Flow
When state tax is entered into Asset Flow, the calculator assesses a tax on Social Security. This tax is based on the benefit amount that is subjected to tax on the Federal Side. If you don’t want this to occur, leave out the state tax rate. Currently, the calculator adds the state tax to anything that is also taxed federally (after those federal deductions). Then there is an offset for the tax paid. This offset is taken off of the Federal Income Tax Basis, up to the SALT limits ($10,000).
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by Elizabeth4TC | Jun 21, 2019 | Comments Off on Truth Tip, Calculating for COLA in Asset Flow
When using the Asset Flow calculator, it is important to calculate for COLA (cost of living adjustment) when determining Social Security income. The Future Value calculator is a handy tool in this case. To set this up properly, fill in the fields as such: Present Value; the annual payment (multiply the monthly payment by 12). Rate; the annual interest rate. Time Frame; the difference between current age and distribution age. If you use the resulting number in Asset Flow as the benefit for Normal Retirement Age, the value will
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by Elizabeth4TC | May 31, 2019 | Comments Off on Truth Tip, Order of Taxation in Asset Flow
In Asset Flow, we chose to treat each individual asset viewed as the last dollar added or withdrawn in the tax bracket (at the margin). This is because any changes made will impact the overall taxation in that regard. However, when you view all the assets in the summary page, the taxes are equally distributed among all of the assets causing the tax. This can cause some discrepancies when viewing an individual asset against the summary of all assets. In Asset Flow, this means it is possible for an individual
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by Elizabeth4TC | May 31, 2019 | Comments Off on Truth Tip, Social Security Taxes
Do you know how much of your Social Security can be taxed? Up to 85% of Social Security Benefits can be subject to income tax, though it can be confusing to understand exactly how to calculate. First, your Modified Adjusted Gross Income (MAGI) must be calculated, which determines the amount of income affecting tax on Social Security income. The calculations for your MAGI do not get to use personal or Standard Deductions to reduce the amount, nor does the Standard Deduction work against Social Security income. In conclusion, the SS
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by Elizabeth4TC | May 17, 2019 | Comments Off on Prosperity Proof #5: The Truth About Qualified Plans
In this final prosperity proof, we’re going to cover one of the most misunderstood financial vehicles: qualified plans. Job seekers today are taught to look for companies that offer qualified plans with an employer match–“It’s free money!” Plenty of financial advisors advocate for qualified plans, and plenty of clients funnel as much money as they can into said plans. While qualified plans are not bad, they cannot be considered a savings vehicle, or even the most viable retirement plan, when you consider the facts. When you look at the facts,
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by Elizabeth4TC | May 3, 2019 | Comments Off on Prosperity Proof #4: Permanent Life Insurance Primer
Universal Life Insurance or Whole Life Insurance? Both are permanent life insurance, but they are not equal. In our fourth Prosperity Proof, we’ll let the differences speak for themselves A PROSPEROUS lifestyle is made possible by having a vehicle to store and save cash that is ALSO accessible and liquid. And that’s where permanent life insurance comes in! But just because you’ve identified that your client is ready for life insurance, doesn’t mean there aren’t some misconceptions left to tackle. Universal Life Insurance is the route that typical financial planning
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by Elizabeth4TC | Apr 19, 2019 | Comments Off on Truth Tip, Asset Flow
In the Asset Flow calculator, you can roll a tax-advantaged account into a new account (like a spouse’s account) at death. It must be done manually, as the calculator is designed to show what happens at liquidating. In Asset Flow, show the principal amount distributed at death going into another IRA (or similar) account the next year with the “Tax Deductible Contributions” box checked. The tax deduction in the new account will offset the taxes paid in the old account for a net “0” tax. You will, however, have to
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by Elizabeth4TC | Apr 19, 2019 | Comments Off on Prosperity Proof #3: What is Prosperity Economics?
Last week we compared home mortgages, and this week we’re going to turn to something more conceptual again. We’ve talked about the Principles for Prosperity, so how do we break down what really sets the movement apart? What is Prosperity Economics? Prosperity Economics is a paradigm shift, totally different from the mindset that typical financial planning builds from. Typical Financial Planning…meets needs and goals only. It’s based on limited ideas of “what you can afford.” It keeps you where you are. Prosperity Economics…pursues wants and dreams. It’s based on unlimited
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by Elizabeth4TC | Apr 5, 2019 | Comments Off on Prosperity Proof #2: Choosing the Right Mortgage
When choosing a mortgage loan, it’s essential to look at all of the facts. Buying a home is a huge financial decision. Being equipped with the right knowledge will ensure you and your clients have the right strategy. A 15-year mortgage has the appeal of a quick payoff, but is it better than a 30-year mortgage? Some people would say yes. We’ll show you how to figure it out. In this installment of Prosperity Proofs, we’ll compare a “typical financial planning mortgage” to a mortgage in line with the Prosperity
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by Elizabeth4TC | Mar 22, 2019 | Comments Off on Prosperity Proof #1: Seven Principles for Prosperity
Join us for the first installment of a series of blog posts: Seven Proofs for Prosperity. Over the course of the series, we’re going to cover what it means to meet financial challenges with a prosperity mindset, and how that can help you and your clients. It all begins with our Seven Principles for Prosperity, from the Prosperity Economics Movement. Here at Truth Concepts, we look at the Truth in financial matters. Part of that Truth comes from applying principles that promote a prosperity mindset—flipping the script from scarcity and
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by Elizabeth4TC | Mar 8, 2019 | Comments Off on Life Insurance Values Tool, Importing Lafayette Life Data
Though the calculators are the meat of the Truth Concepts software, the tools included are an invaluable time-saving resource. In calculators such as Funding, Borrowing, Diversification, Accumulation, Distribution, and Asset Flow, the Life Insurance Values tool cuts the workload significantly. Rather than continually copying & pasting life insurance values, you can import life insurance illustrations directly into your calculator from previously stored data. So where does that data come from? Fortunately, there’s no initial copying & pasting at all. Instead, you can import the information straight from an insurance illustration
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by Elizabeth4TC | Feb 21, 2019 | Comments Off on Collateral: Alternatives to Borrowing from the Life Insurance Company
Those advisors that are “whole-life friendly” know the many advantages of a whole life insurance policy to its policyholders, and the options that are available with a little creativity and a prosperity mindset. One of the primary advantages of a policy is the ability to borrow against the policy’s cash value and secure a loan straight from the insurance company—without the long approval process of a bank loan. While beneficial for a number of reasons, borrowing against the policy is not always the best strategy depending on your client’s desires.
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by Elizabeth4TC | Jan 8, 2019 | Comments Off on 7 Blind Spots of Financial Advisors
Even a seasoned financial advisor can be vulnerable to certain blind spots within the field, what matters is recognizing and learning from these blind spots. Here we have gathered a list of the seven major areas in which advisors can falter, to save you from the same oversights. 1. Forgetting Time Value of Money As an advisor, the time value of money must be applied to every calculation, and any calculation that does not take this into account is not accurate. Every dollar has a value that increases over time,
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by Todd Langford | Dec 4, 2018 | Comments Off on How To Show Your Clients the True Cost of College
The Education Calculator is a tool that illustrates the true cost of college to your clients and creates the basis of a savings model. The numbers may seem straightforward, but the calculator allows you to factor in the yearly rate of increase in tuition and interest on student loans. It is simple to toggle between student information or parent information, which illustrates the base cost and the amount needed to be saved by the parents. The calculator can accommodate the information of up to ten children, making the total cost
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by Todd Langford | Aug 27, 2018 | Comments Off on 7 Ways To Use The Death Benefit
In this recent presentation, Truth Concepts™ did for The National Network of Estate Planning Attorneys we demonstrate how to determine the rate of return on the cash value of a policy as well as take you through the 7 ways to use the death benefit. This is also a good tutorial on the use of the Funding, Diversification and Distribution calculators.
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by Todd Langford | Jun 12, 2018 | Comments Off on Borrowing Against Whole Life Insurance at a Bank
This post originally appeared as an article on Kim Butler’s Partners for Prosperity website at www.partners4prosperity.com/collateral We thought this to be valuable information to also share with the Truth Concepts community. We get many questions on using life insurance policies with cash value as collateral for bank loans. First, you can ONLY borrow against a policy with cash value, such as whole life insurance. You cannot use this strategy at all with a term insurance policy. Often, local (as opposed to large/national) banks and credit unions will lend against the cash
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by Jason4TC | May 11, 2018 | Comments Off on Should I Borrow Against My Life Insurance Policy?
“Should I borrow against my life insurance policy?” Are you ever asked that question? I bet you are. Recently we conducted an annual review with a client. This client is a transfer client. They moved to our town about 8 years ago. About the same time, their other advisor retired so we were lucky. The conversation was very informative and because of the Truth Concepts calculators, the whole truth was easily demonstrated. Let’s join the conversation partly through the review….. “I am going to purchase a new car this summer,”
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by Jason4TC | Apr 6, 2018 | Comments Off on Am I Too Old To Buy Whole Life Insurance?
“I wish I would have known the whole truth about whole life insurance 40 years ago so I could have taken advantage of all the benefits you have described to me,” a brand new prospective client said to me. “I love what you are saying and it makes so much sense, but I am just too old to implement what you are talking about. At my age, it will just be too expensive. But it scares me to death thinking about running out of money.” “Many of our clients say
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by Jason4TC | Feb 26, 2018 | Comments Off on Have I Saved Enough Money?
Andrew Walberg and I had been friends since first meeting in Mr. Carlson’s government class when we were juniors in high school. He was so much fun to be around, always positive and upbeat. I had not heard from him in a while so I was surprised to hear his voice on the other end of the telephone. “Hey, this is Andy. How have you been? I’ve known you’re in the financial services business, but I have never taken the time to talk to you,” he started. “I want to
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by Jason4TC | Jan 31, 2018 | Comments Off on Is It Better to Rent A Home Or Buy?
In this article, I am going to tell you something you already know or may think you fully understand. It starts with this question—is it better to rent a home or buy? The overwhelming response to that question seems to be that it is better to purchase a house instead of renting one. Although I’m sure you answered that it is better to purchase a home, I am going to use Truth Concepts calculators to prove it to you. Don’t stop reading because you think you know it all. Stick
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by Jason4TC | Nov 15, 2017 | Comments Off on The Staggering Impact of Taxes On Investment Returns
The purpose of this post is not to make any kind of political statement. We are not trying to say one side is right or one side is wrong. The purpose of this post is to simply show mathematically something that politicians should understand. More importantly, you as a financial professional should understand this because the impact of taxation on our wealth is significant – significant enough that positioning our money in a tax-advantaged situation is one of the most competitive advantages possessed by whole life insurance. To illustrate the
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by Jason4TC | Oct 29, 2017 | 0 Comment
Time has a way of flying by. John and Jane were now 71 years old. This meeting was going to be one of the most important meetings I would ever have with them. This meeting was certain to prove to them that following my advice all these years was going to pay off. As a result, I did a little extra preparation for the meeting by gathering information about the current cash values of their policies and their other assets. Their 401(k)’s had about $470,000 combined. The cash value of
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by Jason4TC | Oct 6, 2017 | 0 Comment
“I am ready to retire,” John was quick to state at the beginning of our annual meeting. There were several things I wanted to talk to John and Jane Jones about this year since they would be soon turning 60. But when I heard John say this, my plans for the meeting took a back seat. “Are you serious?” I asked John. “Do you think you are ready to retire?” “I have no idea,” John answered. “I am making nearly $185,000 a year, which is a lot more than what
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by Jason4TC | Sep 27, 2017 | 0 Comment
John and Jane met with me regularly, mostly to touch base about their progress as they improved their financial position, or to discuss potential investments. But when their oldest son, Todd, turned 16, we met to discuss a major item that impacted their entire family. Both John and Jane were now 48 years old. During my telephone call to set a time and date for our meeting, John made a comment about how frustrated they were because of their boy. Todd was not a very serious student and his grades
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by Jason4TC | Sep 18, 2017 | 0 Comment
“Hello, this is John Jones. I know we have called a number of times with ‘opportunities’ but this time I think we really have one,” John said excitedly as I answered the telephone early Monday morning before my first appointment. “That is good news,” I said. “Do you want to tell me about it over the telephone or come in for a sit-down meeting?” I asked. “How about tomorrow?” John asked. “We can come anytime you are available.” “I am fairly booked up, but this sounds like an important issue
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