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Robert A. Imparato, Jr CFP®
CERTIFIED FINANCIAL PLANNER™ professional
Craig A. Hyldahl CFP®
CERTIFIED FINANCIAL PLANNER™ professional
R.I.C.H. Planning Group, LLC
105 Fieldcrest Avenue, Suite #507
Edison, NJ 08837
Robert: 732-326-5240
Craig: 732-326-5240
Fax: 732-326-5331
Robert: robert@richplanninggroup.com
Craig: craig@richplanninggroup.com
Website: www.richplanninggroup.com
January/February 2024
High Earners: Pay Attention to Your Financial Well-being
Everyone should closely monitor their finances, but higher-income individuals may need to take extra measures to keep more of their money. While goals should always be the driving force behind financial decisions, knowing your options for preserving income can be a valuable resource.
Tax-advantaged Accounts
Maximizing contributions to taxadvantaged accounts lowers your tax bill by reducing your annual taxable income. Consider contributing the maximum allowable amounts to 401(k) or other workplace plans, traditional or self-employed IRAs, and health savings accounts. Additionally, you can make catch-up contributions to retirement accounts starting at age 50 and to health savings accounts beginning at age 55.Roth Conversions
High earners may not be eligible to make contributions to a Roth individual retirement account. However, they can convert assets in a traditional IRA to a Roth IRA and pay taxes on the conversion. Your savings will have the potential to accumulate tax-free. Qualified withdrawals from your Roth IRA will also be tax-free, and you’ll avoid having to take required distributions.Asset Allocation Adjustments
Where you hold investments can have a big impact on earnings. Consider keeping tax-efficient mutual funds and exchange-traded funds in taxable accounts. Funds that generate higher taxes should be reserved for your 401(k) or IRA, where they’ll remain tax deferred until withdrawal.Charitable Contributions
Contributing to charity may help you save on taxes. You could donate appreciated assets, such as stocks, to a charity and avoid paying capital gains tax; establish a charitable trust and take a tax deduction when the trust is created; or set up a donor-advised fund to manage your charitable donations and deduct your contribution on your income taxes.Deferred Annuities
A deferred annuity is a contract with a life insurance company that is set to pay you a regular income or a lump sum of money at a future date. You won’t pay taxes on the money used to purchase the annuity until you begin making withdrawals, thereby reducing your current taxable income. Annuities are complex products, so consult your financial professional before investing.** Annuity products are not FDIC-insured, and their guarantees are backed solely by the claims-paying ability of the issuing life insurance company. Distributions from annuities are taxed as ordinary income and, if taken prior to reaching age 59 1/2, may be subject to a 10% additional tax.
GE 5994912.1 (10/23) (10/25)
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Securities offered through Equitable Advisors, LLC (NY,NY (212) 314-4600), member FINRA,SIPC (Equitable Financial Advisors in MI & TN). Investment advisory products and services offered through Equitable Advisors, LLC, an SEC-registered investment advisor. Annuity and insurance products offered through Equitable Network, LLC, which conducts business in California as Equitable Network Insurance Agency of California, LLC; in Utah as Equitable Network Insurance Agency of Utah, LLC; and in PR as Equitable Network of Puerto Rico, Inc. Equitable Advisors and Equitable Network are affiliated companies and do not provide tax or legal advice.
R.I.C.H. Planning Group, LLC is not owned or operated by Equitable Advisors or Equitable Network. Equitable Advisors and Equitable Network are brand names for Equitable Advisors, LLC and Equitable Network, LLC, respectively.
GE-4833845.1 (7/22)(Exp. 7/24)
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