February 2020 Living Debt Free and Wealthy Newsletter

Secure Act & You
The Setting Every Community Up for Retirement Enhancement (SECURE) Act was signed into law on December 20, 2019 and has been effective since January 1, 2020. This act has made some very significant changes to 401(k), 529 plans (college funding), RMD’s and the rules regarding inherited Regulated plans.

RMD’s (Good news)

The first change they made is the delay of Required Minimum Distributions (RMD’s). Previously, RMD’s started when an individual reached age 70.5; under the new law (for people born after July 1,1949) they won’t have to take a distribution until they reach age 72. Note: those who have already started must continue to take those distributions.

Regulated Plan Changes (Good news)

One positive change they made to regulated plans is they now allow and encourage annuities as a safe money vehicle available for use in 401k’s. There were also several changes increasing the benefit for employers to start 401ks for their employees. 401k’s also allow for a penalty-free withdrawal of $5,000 to help cover the costs of adopting/having a child. Additionally, up to $10,000 annually of your 529 plan can be used for qualified student loan repayment.

Inherited IRA = TAX BOMB (Bad news)

With the new changes, the Stretch IRA is no more, but what does this exactly mean for you? It means Inherited IRA’s have one of the worst vehicles to pass on to a non-spousal heir. Basically, instead of being able to take payments throughout the heir’s lifetime (spreading out the taxes), they now have to take out all the money by the end of 10 years. Now, because this money is taxed when it is distributed instead of when it is deposited, (Regulated plans are tax-deferred), they now have a massive tax bomb that they can’t really plan for. (Note there are some exceptions to this. Visit the IRS’s website for the full list.)

What do all these changes mean to you?

Planning for retirement and legacy is now more important than ever if you don’t want to leave a financial mess to your heirs. There are so many options out there (such as the ROTH IRA, and others without income limits) that you can use to adjust to these changes. Additionally, we now have more options when accumulating for retirement income. I highly recommend, you talk to an advisor to review your situation and make sure you are still on the right track to meet your goals.
"What you get by achieving your goals is not as important as what you become by achieving your goals"  

-Zig Ziglar

Interesting Facts:

-It is believed that Napoleon made his battle plans in a sandbox

-The bullseye on a dartboard must be 5 feet 8 inches off the ground.

-Minus 40 degrees Celsius is the same as minus 40 degrees Fahrenheit

-The correct response to the Irish greeting, "Top of the morning to you," is "and the rest of the day to yourself."

-The term, ‘Cop’, comes from Constable on Patrol, which is a term used in England.

-Iceland consumes more Coca-Cola per capita than any other nation.
Love Your Heart

February is American Heart Month. Its purpose is to spread awareness to prevent heart attacks and maintain healthy hearts. Here are some tips to make your ticker keep on ticking.

-Let the music move you. It is no secret that being active is healthy for your heart. Dancing raises your heart rate, burns calories, and makes for a great heart-healthy workout. Plus it's fun!

-Watch your blood pressure. People with high blood pressure are 4x more likely to suffer a heart attack or other heart disease. Talk to your doctor to check yours and ask for their assistance in lowering it if necessary.

-Go Nuts. Almonds, walnuts, pecans and other tree nuts go a long way in maintaining a healthy heart. The fats they contain help lower bad cholesterol?

-Walk it off. Next time you feel overwhelmed and stressed. Take a short walk. It will do wonders for clearing your head and lower your stress.

For more information about maintaining a healthy heart contact your doctor or visit the American Heart Association’s website
3 Tips to Help You Sleep at Night
There has probably been a time in your life where no matter how tired you became; you still were not able to fall asleep. This may have been going on for several nights sporadically, over a week period, special occasions, or has been continually going on for much longer. Hopefully, these tips I'm about to share will help you sleep better at night. DISCLAIMER: The advice I am giving is from my personal experiences or those that I talk to. It should not be used to replace a licensed physician's advice.

Before we begin, let me address an elephant. The first step of getting a good night sleep is good mental health. If you suffer from depression, sleep apnea, or other condition that is causing you to regularly not sleep at night, please do not feel embarrassed to go to a licensed professional. It is not taboo; it is a serious condition that may require extra help to treat. This does not make you weak.

First thing we will talk about is breathing and meditation. One cause of lack of sleep is not being able to relax at the end of the day. With all the stresses of everyday life, it can be hard to turn your mind off when it is time to sleep. A good way to help this is to meditate. You can find strategies all over the internet. Another way is to control your breathing. Purposefully take slow, deep breaths (If it helps count them). It will slow your heart rate and give you something else to think about than your stresses helping you fall asleep.

The next thing to help you sleep is stability and consistency. Your body has an internal clock, it is referred to as the circadian rhythm or circadian clock. this clock regulates the periods of sleepiness and wakefulness. Jet lag occurs because "real time" changes from the internal clock. To help your circadian cycle, avoid eating within 2 hours before bed, bright lights before bed, heavy exercise, (as these are all natural resets throwing off the time your body thinks it is) and try to go to bed at the same time each night. If you struggle with this, consider setting an alarm and stick to it.

Finally, make sure you are comfortable. Researchers believe it is best to sleep in a dark, cool room with light ambient noise and a warm bed. If you suffer with cold feet/hands, consider wearing socks/gloves to sleep. Also, be sure to regularly maintain your mattress and pillows. (Average life span of a bed is 5-10 years). Finally, if you and your partner's bedding style varies, consider making the bed with two twin sets so as to make sure no one steals covers and both can achieve their ideal setting. (If it looks tacky you can cover it with your regular sized comforter.)

Sleep is a very important part of maintaining a healthy lifestyle. Hopefully, the tips in here will help you to fall asleep quicker and sleep more soundly. You will appreciate the difference!