Onward into the 20’s…

We are happy to tie a ribbon around our double digit returns for 2019. By February, we erased the small losses incurred in 2018 and, except for a few hiccups along the way, have not looked back! Since 1984, Cantlon Financial Planning has generated over $82 million in gains for our clients. Not too bad considering Mike started with Client One in his home office, known to other Cantlon family members as the basement. We are consistently exceeding a rate of return which should help you to achieve (or continue) a comfortable retirement.

At the end of December, Congress actually got something done and passed the SECURE Act which President Trump signed into law. This legislation changes retirement accounts and how wealth will be transferred to the next generation. The good part of the SECURE Act raised the age that you need to start taking Required Minimum Distributions (RMDs) from your retirement accounts from 70 ½ to 72 years old. If you were not required to take an RMD in 2019, you will not need to start taking RMDs until the year that you turn 72. This will give your retirement accounts additional time to grow before you are required to start taking distributions.

The biggest negative in the SECURE Act is the change for non-spouse beneficiaries of retirement accounts (IRA, 401k, etc). The SECURE Act requires non-spouse beneficiaries to completely distribute (and therefore pay the taxes on) an inherited retirement account within 10 years of the date of death of the contributor. Prior to the SECURE Act, beneficiaries were allowed to stretch the distributions over their own lifetimes. This was very tax efficient since the required distribution was based on the beneficiary’s age. The SECURE Act changes that and could dramatically increase the annual income for beneficiaries. We recommend that everyone review their IRA beneficiary information and talk to us about how to best minimize how your IRA will be taxed. Each situation is different, so please give us a call.

Moving from one year to another allows us to reflect on how things have changed and how they have stayed the same. We are very thankful to you, our client. We (Mike, Tom and Rob) wake up every day looking forward to doing our best to serve your financial needs. If there is anything that has been on your mind that you want to ask about, follow up on or check into, do not hesitate to contact us.

Yours truly,

Michael F. Cantlon
Thomas E. Guyett
Robert T. Gephart