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Medicare open enrollment is here, running from October 15th to December 7th, and it's especially important for those who rely on Medicare. Plans change each year—and so may your needs. Not reviewing your Medicare coverage could leave you exposed to unexpected costs or disrupt your access to preferred doctors and medications. On this week's show, I explore five key steps to help ensure you get the right coverage for 2027.   You will want to hear this episode if you are interested in... [01:40] Reviewing Medicare coverage for 2027 [02:49] How to check provider status: annual notice of change, contacting providers  [03:27] Medicare Advantage and drug coverage options [08:03] Medicare Advantage vs Medigap Plans [11:01] Eight life events that may permit an IRMAA appeal  [11:20] Appealing your Medicare premiums   Reconfirm Your Doctors Are In-Network   One of the most important aspects of Medicare coverage is access to your preferred doctors and hospitals. If you are on traditional Medicare, this is less of a concern since nearly all healthcare providers accept it. Those enrolled in Medicare Advantage plans need to be careful; these plans have specific networks, and providers can leave them at any time. Recently, there's been a trend of hospitals and doctors dropping out of certain Medicare Advantage networks due to disagreements over pay rates and terms.   If your doctor is leaving your network, call their office to find out which plans they'll participate in for 2027. If your preferred doctors aren't part of any Medicare Advantage plan, consider a private fee-for-service (PFFS) plan or a Medicare Advantage plan with a preferred provider organization (PPO), which may allow limited out-of-network coverage. Alternatively, switching to a Medigap plan with traditional Medicare could provide broader access to providers.   Verify Prescription Drug Coverage   No Medicare plan covers every prescription, and the list of covered medications, known as a formulary, is updated each year. These changes could mean vital prescriptions become uncovered or move to a higher-cost tier, increasing your out-of-pocket costs. Many Part D plans are shifting from flat copayments to a model where your cost is a percentage of the drug's price—a significant change for those relying on costly specialty medications.   Check your annual notice of change or log into your Medicare.gov account to confirm which prescriptions will be covered in 2027 and whether their costs have changed.    Understand Your Out-of-Pocket Maximum   Don't overlook out-of-pocket maximums. Traditional Medicare has no maximum, leaving you potentially responsible for 20% of costs indefinitely, but a supplemental Medigap policy can limit your exposure. For Medigap Plan G, once you meet the annual Part B deductible, it covers the full cost of approved services.   To find your plan's specific limit, log in to your Medicare.gov profile and go to your health or drug plan information. Understanding these limits helps prevent devastating financial surprises if you face serious medical needs in 2027.   Consider Switching Plans   Life changes or network shifts may prompt you to consider switching between Medicare Advantage and Medigap. For example, if your doctor drops your Medicare Advantage plan, you split time between multiple states, want to avoid prior authorizations, or need out-of-network coverage, Medigap could be a better fit—even if it carries higher monthly premiums. Most states require medical underwriting for this switch outside your initial six-month window.   Check Your Premiums    If your income has changed considerably, you may be eligible to appeal a higher Medicare Part B or D premium due to IRMAA (Income-Related Monthly Adjustment Amount). The calculation uses data from your tax return two years prior, so 2027 premiums are based on your 2025 income. Valid reasons for appeal include retirement, marriage, divorce, widowhood, and loss of income-producing property, among others.  Resources Mentioned   Retirement Readiness Review Subscribe to the Retire with Ryan YouTube Channel Download my entire book for FREE  ​​Medicare Medicare Income-Related Monthly Adjustment Amount - Life-Changing Event Annual Reports | Kaiser Permanente      Connect With Morrissey Wealth Management  www.MorrisseyWealthManagement.com/contact Subscribe to Retire With Ryan

For those actively planning for a secure retirement, smart tax planning is essential—especially as 2026 comes to a close. Tax laws and contribution limits keep evolving, and timely adjustments can help you keep more of your hard-earned money. On the show this week, I share seven critical tax strategies that can boost your retirement savings while minimizing your tax liability. Here's a deeper look at each move and how to integrate it into your financial plan.   You will want to hear this episode if you are interested in... [01:41] Maxing out pre-tax retirement plans [04:32] Making after-tax contributions to retirement plans [06:05] In-plan Roth conversion and in-service distribution [09:54] Bunching charitable contributions using a donor-advised fund [10:40] Contributing to 529 plans for state tax deductions [12:24] Setting up a flexible spending account [13:16] Maximizing health savings account contributions [14:50] Year-end deadlines for tax strategies    1. Max Out Pre-Tax Retirement Contributions   One of the most effective ways to reduce your taxable income is to contribute the maximum allowable amount to pre-tax retirement accounts like 401(k), 457, 403(b), or SIMPLE IRA plans. Contribution limits are different based on age and plan type—for example, individuals over 50 can contribute up to $32,500 to certain plans in 2026, while those under 50 are capped at $24,500. If you're between 60 and 63, look for special catch-up provisions that allow even higher contributions, up to $35,750 in some cases. Keep in mind that if your income exceeds $150,000 in 2025, portions of your catch-up contributions may have to be made as Roth contributions, meaning they won't reduce your taxable income but instead provide tax-free growth.   2. Consider After-Tax Contributions for Even Greater Savings   Many employer-sponsored plans now allow for after-tax contributions beyond the standard limits. The combined contribution ceiling (including employer matches and profit sharing) can reach as high as $80,000 for those over 50. These after-tax contributions aren't deductible in the year you make them, but they set the stage for powerful strategies like the "mega backdoor Roth IRA," which can let you move larger sums into a Roth account for tax-free compounding growth.   3. Use Roth Conversions—Both In-Plan and Beyond   If your plan allows it, consider converting after-tax contributions to Roth dollars through an in-plan Roth conversion. This lets future growth happen in the Roth portion, making withdrawals tax-free later. Under certain conditions (like reaching age 59½), you might also have the option to roll out your after-tax funds for a more favorable tax outcome 08:11. Doing the math on current and future tax brackets can help determine if a broader Roth conversion is advantageous—particularly in a year where your income is temporarily lower.   4. Leverage Donor-Advised Funds for Charitable Giving   If you make regular charitable contributions yet rarely itemize deductions, a donor-advised fund can be a game changer. By "bunching" multiple years of giving into a single tax year through one of these funds, you may cross the threshold to itemize and get a larger tax deduction. You retain the flexibility to distribute to charities at your own pace in subsequent years.   5. Tap the Power of 529 Savings Plans for Education Expenses   For those with college-bound children, contributions to a 529 plan can lead to valuable state tax deductions or credits. While some states limit deductions to their own plans, nine states allow contributions to any 529 plan to qualify. For example, in Connecticut, individuals can deduct up to $5,000 and couples up to $10,000 from their state income taxes when contributing. This can add up to hundreds of dollars in annual savings, especially when those funds were already earmarked for tuition.   6. Take Advantage of Flexible Spending Accounts (FSAs)   If you're not enrolled in a high-deductible health plan but still incur significant out-of-pocket health costs, check if your employer offers a Flexible Spending Account. With a $3,400 per-person limit, couples can shield up to $6,800 of medical expenses from taxes each year. Be mindful of the "use-or-lose" rule—funds must be spent within a short time frame or risk forfeiture.   7. Max Out Health Savings Accounts (HSAs) with High-Deductible Plans   For those on high-deductible health plans, HSAs offer triple tax advantages: contributions are tax-deductible, growth is tax-free, and qualified withdrawals are untaxed. Unused balances roll over indefinitely and can eventually be used for non-medical expenses in retirement with standard tax treatment, effectively functioning as another retirement account.   Get a Head Start for Year-End Deadlines   Many of these strategies require action before the end of the calendar year. By incorporating the appropriate tax moves, you can take control of your retirement planning and optimize your financial well-being for years to come.   Resources Mentioned Retirement Readiness Review Subscribe to the Retire with Ryan YouTube Channel Download my entire book for FREE    Connect With Morrissey Wealth Management  www.MorrisseyWealthManagement.com/contact Subscribe to Retire With Ryan

I break down the upcoming Social Security cost-of-living adjustment (COLA) for 2027, share my predictions on the new numbers, and explain what you should do to prepare. With inflation still affecting retirees, I explain how the COLA is calculated, what it means for your benefits, and the factors that could affect your retirement income next year. This episode has essential tips to help you make the most of the upcoming increases and manage your retirement finances confidently.   You will want to hear this episode if you are interested in... [01:10] projected 2027 COLA estimates  [03:15] Average COLA increases over recent periods [04:20] How COLA is applied to current and future beneficiaries' benefits [06:24] Expected increase in IRMAA (Income-Related Medicare Monthly Adjustment Amount), its brackets, and projected changes to income thresholds  [08:30] Impact for high earners once the wage base is exceeded [09:29] Changes to the earnings test amounts for those reaching full retirement age    What is the Projected 2027 Social Security Cost of Living Adjustment?   Next week, the Social Security Administration will release the official 2027 COLA. Early estimates put this increase between 3.5% and 3.7%. If the actual figure lands at 3.3% or higher, it will mark the largest single-year raise since 2003. For perspective, the COLA was 2.8% in 2026 and 2.5% in 2025. Over the past five years, retirees have seen a cumulative benefit increase of about 23%, largely spurred by post-pandemic inflation. Why is this important? Because rising prices on essentials, groceries, gas, heating oil, property taxes, and homeowners insurance continue to challenge retirees' budgets. The COLA helps Social Security benefits keep pace with these increases, though it's not always a perfect match.   How Social Security Calculates COLA   Since 1972, Social Security COLAs have been determined using the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), focusing on the average CPI-W during July, August, and September, compared from one year to the next. Before this system, Congress had to approve benefit increases—a process fraught with political uncertainty. Inflation's ebb and flow have shaped COLA history. While the "3% rule" from the 1970s required at least a 3% CPI-W increase, Congress removed that threshold in 1986. Now, even a 0.1% change will trigger a benefit adjustment. Standout years include 1980 and 1981, with double-digit increases amid soaring inflation.   What Retirees (and Future Retirees) Should Do   The good news for most is that no action is needed to receive the new COLA. Social Security beneficiaries will be notified by mail in early December with their exact increase or can check their Social Security account online for quicker updates. The adjustment applies to gross benefit amounts—before tax withholding and Medicare premium reductions. For those not yet claiming Social Security (age 62 and under), the COLA is still factored into your eventual benefit. When you do start collecting, your "primary insurance amount" will reflect these cumulative annual increases, thanks to Social Security's method of indexing past wages into current dollars.   Medicare Premiums and IRMAA   A higher COLA is generally good news but is often offset by rising Medicare Part B premiums. For 2026, the base premium is $202.90 per month, with estimates suggesting a climb to $209.50 in 2027—a 3.4% increase. If your Social Security grows more than your Medicare premium rises, you'll see a net gain, but not always by much. Those with higher incomes may also face the Income-Related Monthly Adjustment Amount (IRMAA), which can tack on an additional $81.10 to $487 per month, depending on your reported income. These surcharges are based on tax returns from two years prior, making proactive tax planning essential.   Wage Base and Earnings Limits   The Social Security wage base—the maximum income subject to payroll tax—will likely rise to about $190,200 in 2027. Once you surpass this amount in earnings, you no longer pay Social Security tax for the year, which could be a small silver lining for high earners. For those considering early Social Security, remember the earnings test limit: if you collect benefits before full retirement age and your work income exceeds $24,280 (projected to rise by around 3%), your benefits will be reduced. However, after reaching full retirement age (typically 67), these limits disappear. Resources Mentioned Retirement Readiness Review Subscribe to the Retire with Ryan YouTube Channel Download my entire book for FREE  Social Security Administration    Connect With Morrissey Wealth Management  www.MorrisseyWealthManagement.com/contact Subscribe to Retire With Ryan

What should you do if the stock market crashes right after you retire? In this episode, I discuss what happens if you experience a major market decline in your early retirement years, explain the concept of sequence of return risk, and share a few strategies to safeguard your hard-earned nest egg and maintain peace of mind.   You will want to hear this episode if you are interested in... [01:20] What to do if the stock market crashes right after retiring [04:09] Sequence of return risk explained [07:14] Preparing for market declines in retirement [13:43] Tax strategies during market decline [15:24] Roth conversions and retirement planning [16:54] Market declines are recurring and necessary for capturing market returns  Risks Retirees Face Retiring at a market peak brings risks. When still working, a market downturn lets you buy investments at lower prices. You have time on your side—and a regular paycheck. In retirement, however, your portfolio often becomes your primary income source. After years of building a $1.5 million nest egg, imagine seeing it drop by 25%, to $1.125 million, just months after retiring—without paychecks to replenish it. Your portfolio potentially shrinks, and you're withdrawing money from a diminished resource, hampering its ability to recover as markets eventually rebound.   Understanding Sequence of Return Risk A key concept is sequence of return risk, which refers to the danger that poor investment returns strike early in retirement. Two retirees may earn the same average annual return, but if one encounters downturns at the start of retirement while the other faces them later, their financial outcomes can be drastically different. Early losses, combined with withdrawals, can irreparably harm a portfolio, making recovery much harder—even if average returns are the same.   Five Steps to Safeguard Your Retirement Portfolio How can you prepare for, and withstand, a major market correction right after retiring? Here are my five key steps:   1. Hold Short-Term Reserves Every retiree should allocate a portion of their portfolio to short-term bonds, cash, or money market funds. This "bucket" provides a buffer, covering your withdrawals during market downturns so you don't have to sell stocks at a loss. Depending on your risk profile, aim to set aside 5 to 10 years' worth of expected withdrawals in these safer assets.   2. Regularly Review Your Asset Allocation As you approach retirement, your investment mix should grow more conservative. Adjusting your asset allocation—perhaps settling on a portfolio of 60% stocks and 40% bonds or cash—can help limit losses. Ask yourself: How much of a decline can you stomach? Even diversified portfolios can lose 25% in significant downturns, which, on a $2 million portfolio, means a $500,000 drop.    3. Stay Flexible with Retirement Spending Categorize your expenses into essentials (housing, food, insurance) and wants (travel, memberships). If markets fall and portfolio withdrawals become a high percentage of your assets, consider temporarily reducing want-based spending. This flexibility buys time for markets to recover and helps your assets last longer.   4. Tax-Smart Withdrawal Strategies If you hold both taxable and tax-advantaged accounts, be strategic. In a downturn, withdrawing from taxable accounts—especially if they contain holdings at a loss or long-term capital gains taxed at lower rates—may minimize your tax burden compared to pulling from traditional IRAs or 401(k)s.   5. Consider Roth Conversions in Down Markets A market drop can be an opportunity: converting pre-tax IRA assets to Roth IRAs at lower prices means a lower tax bill and the chance for future tax-free growth as values recover.   Should You Delay Retirement During a Market Crash? Ensure your financial plan, reviewed with a professional, can weather market shocks before taking the leap 16:25. Stock market declines are inevitable but have historically been followed by recovery and growth—especially for those who avoid panic and keep a steady course. A stock market crash immediately after retirement is daunting, but it doesn't have to ruin your plans. By building robust short-term reserves, adjusting your asset allocation, retaining spending flexibility, employing smart withdrawal strategies, and seizing opportunities like Roth conversions, you can navigate downturns with confidence. Remember: market declines are normal, and with a well-constructed plan, your retirement can weather any storm.   Resources Mentioned Retirement Readiness Review Subscribe to the Retire with Ryan YouTube Channel Download my entire book for FREE    Connect With Morrissey Wealth Management  www.MorrisseyWealthManagement.com/contact Subscribe to Retire With Ryan

How much have you thought about Health Savings Accounts (HSAs) and what happens to them once you enroll in Medicare? Whether you're nearing age 65, wondering if you can keep contributing to your HSA, or curious about how you can use your HSA funds in retirement, this episode covers it all. I explain the rules around HSA contributions after enrolling in Medicare, the types of medical expenses you can pay for tax-free, and what happens to your HSA if there's still money in it after you pass away.    You will want to hear this episode if you are interested in... [01:51] Ineligibility to contribute to HSAs after enrolling in any part of Medicare  [03:02] When to stop HSA contributions [05:46] Automatic Medicare enrollment when collecting Social Security or some retirement benefits  [08:00] Contrast between using IRA vs HSA to pay medical expenses  [09:39] Using HSA for family expenses [14:27] Using the HSA post-65 for medical or other expenses    What Changes With Medicare?   One of the most important things to keep in mind is that once you enroll in any part of Medicare, you are no longer eligible to make HSA contributions. Continuing to contribute after enrolling in Medicare results in excess contributions, which are subject to a 6% excise tax each year the excess remains in the account. This penalty also applies to any income generated by those excess contributions, so immediate corrective action is necessary if you find yourself in this situation. Importantly, Medicare Part A coverage can be retroactive for up to six months if you delay enrollment. Because of this, it's recommended to stop contributing to your HSA at least six months before signing up for Medicare to avoid accidental over-contributions. Letting your employer know and possibly switching away from a high-deductible health plan before enrolling in Medicare can help prevent mistakes.   Can You Still Contribute If You're Working Past 65?   Some individuals continue working beyond age 65 and may wonder if they can keep adding to their HSA. The answer depends on two main factors: your (or your spouse's) participation in a qualified employer-sponsored health plan, and whether you are receiving Social Security or railroad retirement benefits. If you're still working and covered by a group plan with at least 20 employees, you can delay Medicare enrollment and keep contributing to your HSA. However, as soon as you start receiving Social Security or railroad benefits, you're automatically enrolled in Medicare Part A, meaning you must halt HSA contributions—even if you're still working. Carefully timing your Social Security enrollment can help maximize your HSA benefits. Making Tax-Free Withdrawals: Qualified Expenses After 65   Once you turn 65, your HSA is yours for life, even though contributions must stop. Withdrawals for qualified medical expenses remain tax-free—these include doctor's visits, prescription drugs, dental and vision care, hospital stays, Medicare Part B, Part D, and Medicare Advantage premiums, but not Medigap premiums. For example, if you and your spouse spend $500 monthly on Medicare premiums, you could take $6,000 out of your HSA tax-free each year. Long-term care costs, including insurance premiums and care expenses, can also be paid with HSA funds within certain annual limits based on your age. These limits increase with age, reaching $6,200 per year for those 71 and older as of 2026. What Happens to Your HSA After You Die?   Upon death, if your spouse is the named beneficiary of your HSA, the account simply becomes theirs—with all tax advantages preserved. For any other named beneficiary, the HSA must be cashed in and its balance treated as ordinary income, losing its tax-preferred status. If no beneficiary is named, the HSA passes to your estate, triggering potentially higher taxes and delays in distribution.  Resources Mentioned Retirement Readiness Review Subscribe to the Retire with Ryan YouTube Channel Download my entire book for FREE    Connect With Morrissey Wealth Management  www.MorrisseyWealthManagement.com/contact   Subscribe to Retire With Ryan

As you transition into retirement, tax planning might not be at the top of your to-do list—but overlooking it can lead to costly mistakes. This week, I break down the five biggest tax pitfalls new retirees face, from unexpected taxes on Social Security benefits to costly Medicare premium surcharges and missed Roth conversion opportunities. I'm also sharing a few of my favorite strategies to avoid unnecessary state taxes and manage your retirement distributions with confidence.    You will want to hear this episode if you are interested in... [01:45] Without planning, your risk of unnecessary taxes and penalties increases [04:25] Managing taxes on Social Security benefits [08:32] Understanding Medicare Part B premiums [10:25] Understanding and strategizing state-specific tax breaks for retirees [13:15] Roth conversions and required distributions [14:09] Planning retirement account distributions   Smart Tax Planning Can Save You Money  Without proactive tax management, retirees can encounter unexpected tax bills, costly penalties, and unnecessarily complex financial situations. These are the five biggest tax mistakes that people make in the initial phase of retirement—find out how you can avoid them to enjoy your golden years with peace of mind.   1. Failing to Withhold Taxes on Social Security Benefits Many retirees are surprised to discover that Social Security benefits can be taxable. In fact, most will owe some federal tax on these benefits. The IRS calculates the taxable portion based on your combined income—that's your adjusted gross income, non-taxable interest, plus half of your Social Security benefit. Depending on your filing status and total income, between 50% and 85% of your Social Security can be taxable.   2. Accidentally Triggering IRMAA Premiums If you're on Medicare, your income affects your monthly premiums for Part B and Part D. Exceeding certain income limits results in an "Income-Related Monthly Adjustment Amount" (IRMAA)—an unwelcome increase in premium costs. For singles, the first threshold is $109,000, and for joint filers, it's $218,000. Exceeding these levels can raise your premiums by hundreds of dollars per month. One pitfall is making large IRA withdrawals or cashing out retirement accounts in a single year, inadvertently pushing your income above an IRMAA threshold. By spreading withdrawals over several years or strategically withdrawing from different account types (pre-tax, Roth, or brokerage accounts), you may be able to avoid higher premiums.    3. Paying Unnecessary State Income Taxes Where you live has a significant impact on your tax liability in retirement. Some states, like Florida, Texas, and Nevada, have no state income tax. Others offer exemptions for certain types of retirement income, such as pensions or Social Security. However, states without income tax may offset this advantage with higher property or sales taxes. Research the tax landscape of your home state and potential destinations if you're considering relocating. Even if you aren't moving, understanding thresholds for tax exemptions or reduced rates based on income can help you plan withdrawals to minimize your state tax exposure.   4. Waiting Too Long to Make Roth Conversions Roth IRAs provide the benefit of tax-free withdrawals in retirement, making them a powerful planning tool. If you have significant pre-tax IRA balances, converting some of this money to a Roth during your retirement's early years—especially before claiming Social Security—can make sense. Those years often bring lower income, keeping your conversion tax rate modest. Unfortunately, many retirees delay Roth conversions until it's too late. Once required minimum distributions (RMDs) kick in during your 70s, Roth conversions become less practical and may push you into higher tax brackets.    5. Mismanaging Retirement Account Distributions Without a distribution plan, retirees risk withholding too little or too much tax from IRA and 401(k) withdrawals. Setting proper withholding ensures compliance with the IRS "safe harbor" rules—generally, withholding 90% of current-year liability or 100–110% of last year's taxes, depending on your income. You can meet this requirement with quarterly estimated payments or through withholdings on distributions, even waiting until year-end if needed. Careful tax planning with a financial advisor or CPA will help you project your taxable income and avoid penalties. And, when doing Roth conversions, it's always preferable to pay taxes from outside funds, maximizing the amount that becomes tax-free. Resources Mentioned Retirement Readiness Review Subscribe to the Retire with Ryan YouTube Channel Download my entire book for FREE  Social Security Administration  Form W-4V (Rev. January 2026) Request to lower an Income-Related Monthly Adjustment Amount (IRMAA) | SSA     Connect With Morrissey Wealth Management  www.MorrisseyWealthManagement.com/contact Subscribe to Retire With Ryan

Roth IRAs are a powerful retirement tool, much loved for their promise of tax-free growth and withdrawals. But embedded in the rules for Roth IRAs are two little-understood 5-year rules. Misunderstanding these can trip up even savvy savers, potentially exposing your hard-earned gains to taxes and early withdrawal penalties. This week I'm giving you an expert breakdown to clarify how the rule works and bust some common misconceptions.   You will want to hear this episode if you are interested in... [01:13] Tax-deferred growth and conditions for tax-free distributions  [05:39] Taxes on stock gains withdrawal [07:05] New individual 5-year clock for each conversion based on year of conversion  [08:24] Roth IRA conversion rules explained [10:48] Example of an IRA with breakdown of sources, including contributions, conversions, and growth [11:15] Understanding Roth IRA withdrawal rules   Roth IRA Basics Roth IRAs allow you to contribute after-tax money, grow investments tax-deferred, and take distributions tax-free if you follow the rules. The key requirements to keep withdrawals tax- and penalty-free are: You must be age 59½ or older, and Your Roth IRA must have been open for at least 5 years If you don't follow these rules, your distributions could be subject to taxes and a 10% penalty. Missing one of these crucial steps can create an unnecessary tax bill, undermining the Roth's greatest benefit.   Exceptions to the 10% Early Withdrawal Penalty There are a few exceptions to the 10% penalty for taking early Roth IRA distributions before 59½, including: Up to $10,000 for a first-time home purchase Qualified higher education expenses $5,000 for birth or adoption within a year If the account owner dies or becomes disabled Unreimbursed medical expenses above 7.5% of AGI Health insurance premiums while unemployed Certain federal disaster relief, IRS levies, or military service   These exceptions only waive the penalty, not the income tax that might apply if you withdraw earnings instead of contributions.   Understanding the Two 5-Year Rules   The 5-Year Rule for Contributions Think of the first 5-year rule as a clock that starts with your initial Roth IRA contribution. No matter how many subsequent contributions you make, or which custodian holds your account, this clock never resets. If you make your first contribution for 2025—even if you do so in April 2026—your 5-year period begins on January 1, 2025. Once you hit five years and have reached age 59½, you can withdraw earnings tax- and penalty-free. Without those two factors in place, withdrawing earnings could mean income taxes or penalties—no matter your age. For example, someone who opens a Roth at age 58 and is 59½ a year later must still wait until their account has been open for five years before gains are tax-free.   The 5-Year Rule for Roth Conversions Each Roth conversion also triggers its own 5-year clock, but with different consequences if violated. This rule exists because conversions move money from tax-deferred accounts (like a traditional IRA) into a Roth, and the IRS waives the usual 10% penalty on early withdrawals for the converted funds. To prevent people from converting and immediately withdrawing, you must let converted amounts "season" for five years, or else withdrawals before then will be penalized if you're under age 59½. Each conversion starts its own separate 5-year clock. If you convert $200,000 at age 50, you can withdraw that amount at 55 without penalty—but earnings on that conversion are still taxable and possibly penalized unless you're at least 59½.   The Backdoor Roth: Another Clock to Watch Backdoor Roth contributions, a strategy typically used by high earners, are technically a form of Roth conversion and start their own 5-year clocks for withdrawals. Every backdoor contribution, even if done yearly, has its own timeline before the money is fully eligible for tax-free, penalty-free withdrawal. The main 5-year clocks, one for contributions, one for each conversion, are crucial to maximizing the Roth IRA's benefits. Once you're 59½, your account has been open five years, and any conversions are past their five-year marks, you can safely access your Roth savings tax- and penalty-free.    Resources Mentioned Retirement Readiness Review Subscribe to the Retire with Ryan YouTube Channel Download my entire book for FREE    Connect With Morrissey Wealth Management  www.MorrisseyWealthManagement.com/contact Subscribe to Retire With Ryan

Long-term care coverage is an essential, yet often misunderstood, aspect of retirement planning in the United States. Although many people will require some form of long-term care as they age, most are unprepared for the high costs and limited coverage options available. On the show this week, I'm debunking common myths like the notion that Medicare will fully cover all long-term care costs and taking a deep dive into the four main ways retirees can pay for these expenses.    You will want to hear this episode if you are interested in... 00:00 Understanding the options for long-term care help 03:10 The difference between Medicare and Medicaid 05:07 Spouse asset protection options 09:15 Understanding hybrid policy benefits 13:24 Hybrid vs. traditional long-term care 19:25 Long-term care insurance application process   Understanding Medicare's Limitations There is often a misconception that Medicare covers long-term care. In reality, it's split into two primary parts: Part A, which covers some costs for hospital stays, and Part B, which addresses preventative care such as doctor visits and certain procedures. While Medicare may pay for medically necessary hospital stays—such as those following an injury like a broken hip—it stops covering the costs when ongoing care is no longer deemed medically necessary. Extended or custodial care, where you need help with daily living activities but do not require intensive medical treatment, is not included under standard Medicare coverage. This leaves retirees exposed to significant out-of-pocket expenses once hospital-based care ends.   The Four Main Options for Long-Term Care Coverage There are four primary payment strategies for long-term care. Each option has its benefits and limitations, and selecting the right one depends heavily on individual circumstances.   1. Medicaid Medicaid is a needs-based program designed for individuals with low income and limited assets. To qualify, applicants must pass specific income and asset thresholds, which, for single individuals, often means owning less than $2,000 in assets. Married couples have more leeway—the "community spouse" can usually retain a higher amount of assets and income. Medicaid planning may involve establishing a qualified income trust or transferring assets into an irrevocable trust. It is important to note that most states enforce a five-year look-back period for asset transfers, meaning that gifts or transfers must occur at least five years before the Medicaid application to be effective.   2. Self-Insuring Self-insuring is also an option, which involves setting aside personal assets, such as retirement savings or home equity, to pay for potential care needs. This method offers autonomy but carries risk, especially given the high and regionally variable costs of care. Depending on where you live, full-time nursing care can average over $15,000 per month, and home care or assisted living can still cost tens of thousands of dollars per year. Planning ahead is critical, particularly for couples, to ensure one spouse's care does not financially imperil the other.   3. Hybrid Long-Term Care Policies Hybrid long-term care insurance policies have emerged that combine life insurance with long-term care coverage. These products provide either long-term care benefits or a death benefit to your estate, ensuring that money paid into the policy is not "lost" if long-term care is never needed. Hybrid policies tend to offer flexible payout options and the potential for locked-in premiums, but they may provide less coverage per premium dollar when compared to traditional policies.   4. Traditional Long-Term Care Insurance Traditional long-term care insurance remains an option for those prioritizing higher benefit payouts. While these policies can stretch benefit pools further, they don't usually offer death benefits, and their premiums are not guaranteed—they can increase over time and may eventually become unaffordable. Underwriting is also stringent: many applicants over 70 are denied coverage, and certain medical conditions result in automatic disqualification. Making the Right Choice for You and Your Family You need to balance protecting personal assets, securing a spouse's future, and managing premium costs. Retirees should honestly assess their health, financial circumstances, and family situation. Consulting a financial advisor or insurance professional can help tailor a long-term care strategy that minimizes risk while supporting a comfortable and dignified retirement. Planning now, rather than later, ensures you are prepared for whatever the future may bring—and that you and your loved ones have peace of mind.   Resources Mentioned Retirement Readiness Review Subscribe to the Retire with Ryan YouTube Channel Download my entire book for FREE    Connect With Morrissey Wealth Management  www.MorrisseyWealthManagement.com/contact Subscribe to Retire With Ryan

On the show this week, I'm helping you understand why bond prices have been dropping, what actions investors should take, and whether bonds still have a place in a retirement portfolio. I discuss the different types of bonds and how interest rates impact bond prices. I also dig into the importance of maintaining a diversified portfolio and the role bonds can play in reducing overall volatility during retirement.    You will want to hear this episode if you are interested in... [02:03] Types of Bonds and issuers [03:21] Risks of investing in junk bonds [04:39] Why have bond prices declined this year?  [09:52] Deciding on bond investments [11:10] Investing in bonds for retirees [12:47] Bonds as a source of income and volatility reduction  Why Bond Prices Are Down and What Actions to Consider   There are several fundamental types of bonds—government, corporate, agency, and municipal—and they all have different levels of risk. Bonds are also classified based on their credit ratings, ranging from top-rated "investment grade" (BBB or higher) to "junk" or high-yield bonds (below BBB). I share more about the increased risk and potential reward of high-yield bonds, and why defaults can lead to stressful and lengthy processes for investors. Why Have Bonds Declined in 2026?   Why have bond prices declined even though the economy is not in recession? There is an inverse relationship between bond prices and interest rates. When interest rates rise, as has been the case in 2026, bond prices fall. Even a seemingly small increase is sufficient to push bond prices down and reduce the total return for many bond funds. Rising rates mean many bond funds have seen negligible or negative total returns this year.   The Broader Factors Influencing Interest Rates   There are several drivers behind the upward movement in interest rates. First, expectations that the Federal Reserve will hike rates to curb inflation have affected investor behavior. Second, growing government deficits and the issuance of more national debt lead investors to demand higher yields as compensation for greater risk. Third, technology companies, especially those investing heavily in AI, have issued substantial new debt, pushing rates even higher as they compete with Treasuries for investor capital. Much like the stock market, the bond market is subject to various economic forces and investor sentiment, making timing extremely difficult.   The Case for Keeping Bonds in Your Retirement Plan   Despite the recent decline in prices, bonds remain an important part of a retirement portfolio. Historically, bonds have exhibited significantly less risk and volatility than stocks, especially during market downturns. Keeping some portion of assets in bonds provides stability, reduces overall portfolio fluctuations, is a reliable source of income when the stock market underperforms. By maintaining a portion in bonds, retirees create a safety net and source of funds for income needs without being forced to sell equities during downturns.   Resources Mentioned Retirement Readiness Review Subscribe to the Retire with Ryan YouTube Channel Download my entire book for FREE  Morningstar.com  S&P Global Ratings Moody's Vanguard Total Bond Market ETF State Street SPDR Long-Term Treasury ETF Long-Term Treasury ETF  Short-term Treasury bond funds     Connect With Morrissey Wealth Management  www.MorrisseyWealthManagement.com/contact Subscribe to Retire With Ryan

Retirement is often imagined as the reward after decades of hard work—a time for travel, relaxation, and quality time with loved ones. But for many Americans, the anxiety of running out of money casts a long shadow over these golden years. Studies reveal that concerns about outliving savings are more prevalent than fears of dying prematurely. This week we're discussing the five key reasons retirees run out of money and sharing practical steps you can take to secure your financial future.   You will want to hear this episode if you are interested in... [02:16] Even high-income retirees are at risk of running out of cash [03:43] Three phases of retirement spending: go-go, slow-go, and no-go years  [04:31] Planning an intentional withdrawal strategy in retirement [07:40] Rules of lending or gifting money to family [12:46] Managing long-term care costs [14:59] Retirement fund inflation risks [16:21] Maintaining significant portfolio exposure to stocks (at least 60%)    The Hidden Risk to Longevity   One of the most common pitfalls is overspending, especially in the early years of retirement. The excitement of newfound freedom often encourages retirees to start ticking off bucket-list items such as home renovations, travel, and hobbies without a clear plan. Retirement can last 30 years or longer, and spending too aggressively early on can have dire long-term consequences. There are three phases of retirement: the "go-go" years marked by active spending, the "slow-go" years when travel and activities slow down, and the "no-go" years when health and mobility may limit expenses. Adopting a dynamic withdrawal strategy, such as the Guyton-Klinger guardrail approach, allows you to adjust spending based on portfolio performance and inflation, reducing the probability of running out of money. Helping Family at Your Own Expense   Of course you'll want to help out your kid or the wider family support is natural, but extending excessive financial help can jeopardize your own stability. Gifting or lending money to grown children or other relatives requires careful consideration. Ask yourself if you can really afford to part with the funds, and whether the risk to the relationship is worth the potential fallout if the money isn't repaid. If you cannot comfortably give the money, it's wise to set boundaries. Remember, if your retirement funds run dry, returning to the workforce may not be an option.   Underestimating Healthcare and Long-Term Care Costs   Unexpected medical expenses can wipe out retirement funds quickly, especially for those retiring before age 65, when Medicare coverage begins. Private health insurance can cost as much as $1,000 per month for an individual and double for a couple.  Long-term care is another important consideration. Home care may run $40,000 to $80,000 annually, while nursing facility care can reach $190,000 per year, with average stays of 2.5 years. Protect yourself by exploring options like long-term care insurance or irrevocable trusts to shield assets if extended care is required.   Inflation Causes Hidden Erosion   Even low annual inflation compounds over decades, silently shrinking your purchasing power. Social Security, especially with its cost-of-living adjustment, can help offset this, but many pensions and fixed investments cannot. Keeping at least 60% of your portfolio in stocks gives the best chance of growth that outpaces inflation, ensuring your income maintains its real value. The prospect of running out of money in retirement is daunting, but it's not inevitable. By balancing spending, setting boundaries around family assistance, preparing for health-related costs, and protecting against inflation, you can stack the odds in your favor. Resources Mentioned   Retirement Readiness Review Subscribe to the Retire with Ryan YouTube Channel Download my entire book for FREE  Allianz Life's 2026 Annual Retirement Study  Retirement Security Research Center  Guyton-Klinger Guardrail Withdrawal Strategy  Connect With Morrissey Wealth Management  www.MorrisseyWealthManagement.com/contact Subscribe to Retire With Ryan

When you're moving into retirement, you're most likely to be starting to ask yourself which investment accounts you should start drawing from first. There's really no universal answer—retirement withdrawal strategies are deeply personal and situation-dependent. But understanding the implications of each account type and the factors that influence withdrawal order can have a massive impact on your tax burden and the longevity of your assets.    You will want to hear this episode if you are interested in... [00:00] Retirement withdrawal strategy options [06:37] Roth IRA and taxable accounts [07:47] Tax implications for investment gains [14:12] Roth IRA conversion strategy [16:17] Real-life retirement income strategies [19:36] Importance of a withdrawal strategy   Understanding the Account Types and Their Tax Impact   The foundation of your strategic withdrawal plan begins with understanding how each investment account is taxed:   1. Pre-tax Retirement Accounts These include traditional IRAs and 401(k)s, SEP IRAs, and similar plans. Contributions offer a tax deduction, and growth is tax-deferred, but withdrawals are taxed as ordinary income. These accounts are eventually subject to required minimum distributions (RMDs), currently beginning at age 73 or 75, depending on your birth year. Withdrawals here not only increase your reported income but can also impact Medicare premiums and Social Security taxation.   2. Roth Accounts Roth IRAs and Roth 401(k)s are funded with after-tax contributions. Qualified withdrawals are tax-free and—if the original contributor owns the account, not subject to RMDs in your lifetime. This makes Roth accounts especially valuable for flexible, later-stage withdrawals.   3. Taxable Brokerage Accounts These are standard investment accounts not designated for retirement. Withdrawals of principal do not create taxable events; only realized capital gains, dividends, and interest are reported for taxes. One major benefit: capital gains rates can be lower than ordinary income rates and may even reach 0% for some filers. Withdrawals can be easy to manage for opportunistic or requirement-driven needs.   Questions to Consider with Personalized Withdrawal Planning Several personal factors play into the best withdrawal order: Are you retiring before 65 and in need of Affordable Care Act (ACA) health insurance? Do you want to minimize future RMDs or leave assets to heirs? When will you begin Social Security or receive pension income? What is your preferred tax bracket and desired lifestyle flexibility?   These questions should be revisited regularly, as changes in tax law, health, or legacy wishes can affect your strategy.   Real-World Withdrawal Scenarios Coordinating Withdrawals for ACA Subsidies Jonathan retires at 57, pre-Medicare, and must carefully manage his modified adjusted gross income (MAGI) to retain ACA health insurance subsidies. My suggested plan is to combine modest 401(k) withdrawals, reportable dividends, and money market interest to stay below the MAGI threshold. Additional cash needs are met from accounts, like the money market, which don't affect taxable income. This keeps his subsidy and aligns with income limits, demonstrating the need for multi-account coordination.   Reducing Future RMDs and Leaving a Legacy Walter and Amy, 62, want to avoid burdening their heirs with high-tax inheritance on pre-tax accounts. Instead of focusing solely on paying the least tax today, they prioritize Roth conversions while Social Security is delayed, taking advantage of lower brackets now to transfer wealth into tax-free vehicles. Over several years, they could convert hundreds of thousands into Roth IRAs, significantly reducing future RMDs while maximizing wealth transfer.   Minimizing Tax on Social Security Christian, 68, blends Social Security with distributions from non-taxable sources like his money market to avoid triggering federal taxes on his Social Security. Careful planning allows him to either keep Social Security tax-free or, with limited IRA withdrawals, incur only minimal tax.   The Importance of Ongoing Review and Professional Advice Your withdrawal strategy is not a "set-and-forget" plan. Tax laws, account balances, and individual goals will change over time. I suggest annual reviews and, ideally, working with a specialized financial advisor to continually adjust the plan for optimal tax efficiency and income sustainability. A thoughtful approach, tailored to your personal circumstances and updated regularly, will help you balance tax efficiency, income needs, and legacy goals.    Resources Mentioned Retirement Readiness Review Subscribe to the Retire with Ryan YouTube Channel Download my entire book for FREE    Connect With Morrissey Wealth Management  www.MorrisseyWealthManagement.com/contact Subscribe to Retire With Ryan

On the show this week, I answer a listener question about restricted stock units, or RSUs—what they are, how they're taxed, and the best strategies for managing them as they vest. I'll take an in-depth look at different types of vesting schedules, tax implications, and the practical choices you have when your RSUs become available. This episode is all about giving you clear guidance to help you make informed decisions about RSUs and making sure your retirement strategy is on the right financial track.   You will want to hear this episode if you are interested in... 00:00 Explanation of Restricted Stock Units (RSUs) 04:19 How stock vesting works 05:14 RSUs are treated as ordinary income when they vest  06:52 Understanding RSU Tax Withholding 11:36 Investing in Index Funds 12:58 Matching investment decisions to risk tolerance and goals    Restricted Stock Units (RSUs) RSUs represent a promise from your employer to deliver company stock or a cash equivalent in the future once certain conditions, called vesting requirements, are met. These conditions are designed to incentivize and retain employees, ensuring that you benefit as the company grows and performs well.   RSUs usually vest in one of three ways:   Time-Based Vesting: The most common approach, where shares vest gradually over a specified period. For instance, a 4-year vesting schedule for 1,000 RSUs would typically see 250 shares vest each year. At ESPN and Disney, a 3-year vesting schedule is standard, with shares vesting twice annually—in the summer and fall.   Performance-Based Vesting: Shares vest only if certain targets are met, such as revenue goals or profit margins. Some grants only vest if multiple targets are reached.   Liquidity Event-Based Vesting: Common in private companies, where shares vest after events like an IPO or a company merger. If you leave your employer before shares vest, you lose any unvested RSUs—a strong incentive to stay.   How Are RSUs Taxed? When RSUs vest, the value of the vested shares is treated as ordinary income, just like your regular salary. This income is reported on your W-2 and is subject to federal, state, and payroll (FICA) taxes. Social Security taxes apply up to a certain annual earnings cap ($184,500 in 2026), but Medicare taxes continue regardless of income. To cover your tax liability, employers usually sell enough shares on your behalf (a "sell-to-cover" transaction). For example, if 100 shares vest and 20 need to be sold to cover taxes, you'd end up with 80 shares. Employers typically withhold taxes at a 22% rate; if your annual compensation exceeds $1 million, the withholding rises to 37%. Many employees find themselves under-withheld, especially if they move into higher tax brackets, and may need to adjust their W-4 or set aside additional funds to avoid owing at tax time. What Are Your Options When RSUs Vest? Once RSUs vest, you have several paths forward:   1. Hold the Shares Some employees hold their RSU shares, believing in the long-term prospects of their company. This approach can create significant wealth if the stock outperforms, but it also concentrates risk—especially if your job and sizable net worth are tied to the same company.   2. Sell Immediately Selling your shares right away locks in your gains, minimizes risk, and frees up cash to fund other goals, like buying a house or paying for college. Just be cautious about spending it all; ensure you're saving enough for long-term needs.   3. Sell and Reinvest Sell your RSU shares and reinvest the proceeds in diversified assets, such as index funds (e.g., S&P 500 or total market funds), or bonds if you have a lower risk tolerance. This strategy provides broader market exposure and can reduce the risk inherent in holding too much of a single company's stock. Resources Mentioned Retirement Readiness Review Subscribe to the Retire with Ryan YouTube Channel Download my entire book for FREE  State Street S&P 500 Index Fund (SPYM) State Street Aggregate Bond Fund (SPAB)   Connect With Morrissey Wealth Management  www.MorrisseyWealthManagement.com/contact Subscribe to Retire With Ryan

For many Americans, the idea of retiring before age 59 and a half often seems out of reach, particularly when the bulk of their savings sits in an employer-sponsored 401(k) or 403(b) plan. Traditionally, the tax code penalizes early withdrawals from these accounts. However, the Rule of 55 could open the door to a more flexible, penalty-free early retirement. On this episode, I'll share more about this IRS provision, who qualifies, how to use it wisely, and potential hazards to avoid.   You will want to hear this episode if you are interested in... [00:00] Overview of the Rule of 55 and its relevance to retirement savers [02:20] IRS provision allowing penalty-free withdrawals before age 59½ [05:03] Withdrawing from employer 401k early [07:19] Understanding the Rule of 55 [10:06] Common scenarios where Rule of 55 is useful [12:11] Does not apply if funds are rolled into an IRA    A Deep Dive Into the Rule of 55 The IRS usually limits penalty-free withdrawals from retirement plans until you are 59½. Withdrawals before then typically face a 10% early withdrawal penalty on top of regular income taxes. The Rule of 55 is an exception, allowing people who leave their jobs in or after the calendar year they turn 55 to access funds from their employer's plan without being penalized.   There are several conditions to qualify: You must have left (voluntarily or involuntarily) your employer on or after reaching age 55 within the same calendar year. The funds must remain in the retirement plan of your most recent employer; this rule does not apply to old 401(k)s or IRAs.   Who Qualifies for the Rule of 55? To benefit from the Rule of 55, you must separate from your employer (by retiring, being laid off, or quitting) in the year you turn 55 or later. Importantly, the provision only applies to the plan at your most recent employer. If you have funds in 401(k)s from previous jobs, they are not eligible—unless you move those funds into your current employer's plan before you separate. This rule does not apply to IRAs of any kind.   Strategic Considerations Before Using the Rule Accessing your retirement funds early can provide flexibility, but there may also be drawbacks. Consider the following aspects before making withdrawals:   1. Plan-Specific Rules Not every employer allows post-separation distributions that leverage the Rule of 55. Check your plan document or HR department to confirm eligibility. Some plans may even restrict withdrawals to lump-sum distributions—a move that could trigger a significant tax event.   2. Tax Implications The Rule of 55 lets you avoid the 10% early withdrawal penalty, but income taxes still apply to distributions from pre-tax 401(k)s. If you're withdrawing from a Roth 401(k), only qualified distributions escape taxation, earnings could still be taxed if the account isn't at least five years old or you haven't reached 59½.   3. Returning to Work You can still take penalty-free withdrawals from your old plan and work elsewhere, you just can't return to the same employer and continue penalty-free distributions from that plan.   4. Preserving Your Nest Egg Large or ill-timed withdrawals can erode your investments and disrupt your long-term retirement security. It's crucial to view withdrawals in the context of a potential 25- to 35-year retirement span.   Common Scenarios and Use Cases   Unexpected Job Loss: After an unexpected layoff at age 57, you can supplement your income using penalty-free 401(k) withdrawals until age 59½. Bridging Pension Gaps: If your pension doesn't kick in until 60 but you retire at 56, the Rule of 55 can provide necessary cash flow for those interim years. Semi-Retirement Transitions: Those shifting to part-time work or consulting may use partial withdrawals to cover living expenses while ramping up new income streams.   Using the Rule of 55 requires careful planning and a clear understanding of your plan's rules and your long-term income needs. Before making any moves, consult with a financial advisor to develop a sustainable retirement withdrawal strategy. Resources Mentioned Retirement Readiness Review Subscribe to the Retire with Ryan YouTube Channel Download my entire book for FREE  Topic no. 558, Additional tax on early distributions from retirement plans other than IRAs   Connect With Morrissey Wealth Management  www.MorrisseyWealthManagement.com/contact Subscribe to Retire With Ryan

For many retirees, their home isn't just a place of comfort, it's one of the largest assets on their balance sheet. However, beyond the emotional value and the years of accumulated equity, there's an often-overlooked reality: selling your primary residence can bring an unexpected tax bill. If you're contemplating a sale or want to ensure you're planning wisely, understanding the IRS's primary residence capital gains exclusion is essential. On the show this week, I break down what this exclusion means, who qualifies, how to maximize its benefits, and the critical planning steps to avoid a nasty tax surprise.   You will want to hear this episode if you are interested in... [00:00] Understanding capital gains exclusion [03:52] Capital gains exclusion requirements [07:40] Reducing taxes on home sale [11:31] Calculating capital gains tax [14:57] Impact of capital gains on IRMAA   The Primary Residence Capital Gains Exclusion Thanks to the IRS, many homeowners can exclude a substantial portion of the capital gains realized from the sale of their primary residence. Single tax filers can exclude up to $250,000 of gains while married couples filing jointly enjoy up to a $500,000 exclusion. In practical terms, this means if your gain from selling your home stays within these thresholds, you may owe no federal tax on that profit.   Who Qualifies for the Exclusion?  Before assuming you'll benefit from this significant tax break, it's important to meet all IRS requirements:   1. The Ownership and Use Test: You must have lived in the home as your primary residence for at least two of the five years preceding the sale. These years don't need to be consecutive, but they must total at least 24 months within the five-year window.   2. Exclusion Frequency: You cannot have claimed the exclusion on another home sale within the past two years.   3. Acquisition History: The property generally cannot have been acquired through a 1031 like-kind exchange in the previous five years.   Special Rule for Widows and Widowers: If you've recently lost your spouse, you may still qualify for the full $500,000 exclusion if you sell within 24 months of your spouse's passing, don't remarry during this period, and have satisfied the other ownership and use requirements.   Why More Homeowners Now Face Capital Gains Taxes Home values have seen record appreciation over the last three decades, but the exclusion thresholds haven't changed since 1997. A homeowner who bought in their 20s or 30s might now find that decades of appreciation have pushed them well beyond the exclusion limits—and into taxable territory. If your gains surpass the exclusion, any additional gains are taxed either as short-term (if you've owned the home for a year or less) or, more commonly for longtime owners, as long-term capital gains (taxed at 0%, 15%, or 20% depending on your income).   Maximize Your Savings: Track and Increase Your Cost Basis One of the most effective strategies to reduce your taxable gain is to properly track and boost your home's cost basis. Your cost basis starts with your original purchase price and is increased by certain acquisition costs (settlement fees, title insurance, legal fees, etc.). Most importantly, capital improvements—such as room additions, roof replacement, major kitchen or bath remodels, or HVAC system upgrades—can be added. Routine maintenance and minor repairs generally don't increase your basis, so keeping thorough records of major projects and associated costs is crucial. Medicare Premiums and Tax Strategy Selling your home and realizing a large capital gain may bump you into a higher Medicare premium bracket, known as IRMAA, which can affect your Part B and Part D premiums a couple of years after the sale. This makes it essential to coordinate a home sale with your overall income strategy and consult both a financial advisor and CPA before listing your home. Resources Mentioned Retirement Readiness Review Subscribe to the Retire with Ryan YouTube Channel Download my entire book for FREE  National Association of REALTORS® Avoid These 7 Scenarios to Keep Your Medicare Premiums Lower In Retirement #313 2026 Medicare Part B Premium Surprises, #282  7 Ways to Lower Your Income and Avoid the IRMAA Medicare Surcharge, #142      Connect With Morrissey Wealth Management  www.MorrisseyWealthManagement.com/contact Subscribe to Retire With Ryan

On July 4, 2026, a groundbreaking opportunity opened for parents and guardians aiming to give their children a head start on their financial journey: Trump Accounts. Created as part of the OBBA Tax Act ("One Big Beautiful Bill" Tax Act) of 2025, these tax-advantaged investment vehicles provide a unique way to grow wealth for minors. In this episode, I break down what Trump Accounts are, who's eligible for generous bonuses, how to get started, and how they compare to other common savings options like 529 plans.   You will want to hear this episode if you are interested in... [00:00] Understanding Trump accounts for children [04:22] What are the baby bonus qualifications? [09:04] Opening a Trump investment account [11:37] Comparing Trump accounts to 529 plans [16:07] Converting IRA for tax-free growth [17:15] Benefits of Trump accounts    Unlocking the Potential of Trump Accounts Trump Accounts are designed for children under 18 who have a valid Social Security number. Funded with after-tax dollars, these accounts work similarly to retirement accounts, with investments inside the account compounding tax-deferred. That means any dividends, interest, or capital gains grow without being taxed until withdrawal—effectively turbocharging your child's investment returns. Once the child turns 18, the account automatically converts to an IRA in their name. Withdrawals are then subject to traditional IRA distribution rules: generally, penalty-free access begins at 59½, although exceptions exist, such as those for first-time homebuyers or qualified education expenses.   Who's Eligible for Bonuses? One of the biggest draws of Trump Accounts is the potential for substantial bonus contributions.   $1,000 Federal Bonus: Children born between January 1, 2025, and December 31, 2028, automatically qualify for a $1,000 government deposit. This eligibility is irrespective of parental or child income, provided the child is a US citizen with a valid Social Security number.   $250 Dell Foundation Grant: For children born before 2025 who are under 10 years old, the Michael and Susan Dell Foundation offers a $250 grant. Eligibility extends to those living in zip codes where the median household income falls below $150,000.  Trump Accounts vs. 529 College Savings Plans Given the array of college savings vehicles available, how do Trump Accounts stack up to the well-established 529 plan? Here's a quick comparison: 529 Plans: Designed specifically for education expenses, 529 plans offer tax-deferred growth and tax-free withdrawals for qualified expenses. They also allow conversion of up to $35,000 to a Roth IRA under certain conditions if the funds are unused for education costs. Trump Accounts: More flexible since, after age 18, the funds move to an IRA in the beneficiary's name. While distributions for education from a Trump Account IRA are taxed as ordinary income (with penalties waived for qualifying expenses), the account's chief power is in supercharging long-term retirement savings for the child. Should You Open a Trump Account? If your child or grandchild qualifies for the $1,000 or $250 bonuses, opening an account is almost a no-brainer. For others, the decision will come down to your savings goals. Trump Accounts offer unmatched momentum for retirement savings, while 529s are still preferred for pure college saving. The earlier you start, the greater the rewards of compounding.    Resources Mentioned   Retirement Readiness Review Subscribe to the Retire with Ryan YouTube Channel Download my entire book for FREE  Michael & Susan Dell Foundation Trump Accounts App   About Form 4547, Trump Account Election(s)   Connect With Morrissey Wealth Management  www.MorrisseyWealthManagement.com/contact Subscribe to Retire With Ryan