Retirement Planning - Accumulation &

Taxation G E R A L D H E N D R I K A N D D R E W

P O E

Introduction

-My name is Drew Poe

-Over 16 years with Deloitte which I left in 1992.

-Started my Tax Office in 1992 -3 Beautiful Kids -

More than 45 Years of experience in total

-Lives in Fort Worth

2

Introduction-My name is Gerald Hendrik

-My wife Melanie and I own Rockwall Wealth Advisors

-Over a decade of experience with Series 66, Series

65, Series 7, CDFA, and SEI Credentials/Licenses

-3 Beautiful Kids (Twins Boys and Daughter)

-From Texas (Just east of Dallas)

3

Stats-64% of Americans Aren’t Prepared For Retirement — and 48% Don’t Care (Go Banking Rates-2019)

-1 in 3 Americans Has $0 Saved for Retirement (2016-PRNewswire)

-42% of Americans Will Retire Broke (GoBanking Rates-2018)

-50% of Tax Payers feel they pay to much (GallupNews.com)

4

Agenda6 Steps to Retirement Planning in 2021

Topic 1: Have a Plan and a Solid Foundation

Topic 2: The Hierarchy of Savings and Taxation

Topic 3: Know your Investment Options

Topic 4: Assess your Risk Profile

Topic 5: Diversify, Diversify, Diversify

Topic 6: Review, Renew, and Rebalance

5

Topic 1:H A V E A P L A N A N D S O L I D

F O U N D A T I O N

Have a Plan (Where are you today)

Sam

ple footer text

Knowing where you are today will give you the best chance of reaching your destination financially.

And then……

Once you have a plan, have a backup plan.

20XX 7

Have a Plan (Where are you today)

8

Have a Plan Video: Have a plan and a backup plan. Sometimes you might have to pivot.

What does Pivot Mean?

A pivot means fundamentally changing the direction of an original plan when you realize the current plan is not working.

Remember having a plan is not enough. Sometimes you have to pivot.

Have a Plan (Where are you today)

• Determine What Age You Want To Retire (Will You Work Part Time)

• Roughly Calculate Your Expenses

• Know Your Balance Sheet (Assets/Liabilities)

• Pay Down Debt

• Determine How Much You Should Save

• How Much Income Do You Expect In Retirement (Social Security, Annuity, IRA Accounts)

• Understand current taxes and potential future changes around taxes

9

10

0

1

2

3

4

5

6

Category 1 Category 2 Category 3 Category 4

Chart Title

Series 1 Series 2 Series 3

Topic 2: Know the Hierarchy of Saving

Hierarchy of Savings

• How Much Do You Specifically Need for Emergency/Job

Security

• Always get the Free Money

• Strategize on How to Pay Down Debt

• Roth and Traditional IRA’s (Limit 6k or if 50+ 7k)

• Max Out Company 401k (2021 Limit is $19,500 or if 50+

Can add additional $6,500)

• Investment Accounts (Brokerage)

12

Uncle Sam

13

Taxation of Retirement Distributions

NORMAL • ORDINARY INCOME• TAX RATE• ROLLOVER TO ANOTHER RETIREMENT ACCOUNT LIMITED TO ONE

EVERY 12 MONTHS• QUALIFIED DOMESTIC RELATIONS ORDER(QDRO)

EARLY BEFORE 59 ½• PENALTY 10%• EXCEPTIONS

• MEDICAL PREMIUMS OF UNEMPLOYED & RECEIVING UNEMPLOYMENT PAYMENTS.

• EDUCATION EXPENSES• MEDICAL EXPENSES IN EXCESS OF LIMITATION• FIRST TIME HOME PURCHASE LIMIT $10000 LIFETIME• BIRTH OR ADOPTION EXPENSES $ 5000• DISABILITY• DEATH• MILITARY EXCEPTIONS• OWE THE IRS• ROLLOVER TO ANOTHER RETIREMENT ACCOUNT• SUBSTAINTIALLY EQUAL PERIODIC PAYMENTS• QDRO

REQUIRED MINIMUM DISTRIBUTIONS

14

Advanced Hierarchy of Savings

15

Topic 3: Investment Options and Strategies16

17

Topic 4: Assess Your Risk Profile 18

19

Goals: The purpose of financial planning isn’t to accumulate the biggest pile of money possible. It’s to decide what you want out of life, calculate how much money you need to reach those goals, and then choose an investment strategy that will deliver the appropriate returns.Timeline: Generally, you can take more risk if you have a lot of time to ride out the bumps. “If you’re going to need money in five or 10 years, that’s much different than if you have 15 years or moreAge and life stage: “If you’re in your 80s, that tolerance can’t be as high as it would be for someone in their 30s. At 30, you’ve got time not only to ride out volatility but to make more money working.Portfolio size: Someone starting retirement with a $5 million portfolio may be able to take more risk than someone with $500,000. The person with the larger portfolio has more cushion if values drop.Personal comfort level: Some people are naturally more comfortable with taking risk than

Example:

Topic 5: Diversify, Diversify, Diversify

Diversification is the practice of spreading your investments around so that your exposure to any one type of asset is limited. This practice is designed to help reduce

the volatility of your portfolio over time.

22

Example:

Topic 6R E V I E W , R E N E W , A N D R E B A L A N C E

Review often

-Can you afford to increase your Investment Budget?

- What has changed since your last tax return? (kids, new job,

real estate, income, etc.)

-Is your allocation still appropriate?

-Is your allocation still balanced?

-What other circumstances changed?

24

Summary

The burden of retirement planning and Tax Planning is falling on individuals now more than ever. Few employees can count on an employer-provided defined-benefit pension, especially in the private sector. The switch to defined-contribution plans, such as 401(k)s, also means that managing the investments becomes your responsibility, not your employer’s.

One of the most challenging aspects of creating a comprehensive retirement and tax plan is striking a balance between realistic return expectations, managing taxes, and a desired standard of living. The best solution is to focus on creating a flexible portfolio and tax strategy that can be updated regularly to reflect changing market conditions and retirement objectives.

25

Thank you

Gerald Hendrik CDFA®

Gerald@RockwallWealthAdvisors.com

www.RockwallWealthAdvisors.com

&

Drew Poe CPA®

26

Sources Used

• Go Banking Rates-2019

• 2016-PRNewswire

• GoBanking Rates-2018

• https://news.gallup.com/poll/1714/taxes.as

px

27