Big Plans for 2023
February 2, 2023
Welcome to The Retirement Tax Podcast, where hosts Steven Jarvis, CPA, and Benjamin Brandt, CFP, work together to bridge the gap between tax professionals, financial advisors, and their mutual clients to help reduce most people’s largest expense in retirement: taxes. Each week, they will dive into conversations around taxes, focusing on what you can truly control (instead of what you cannot) and how to set yourself up financially for your future.
Moving into a new year feels like a fresh start for many reasons, and it’s always a good time to reflect, assess, and plan. As 2022 transitions into 2023, Ben and Steven have been working on business planning and will share some of that in this episode. They’ll dive into the “why” that brought them together, how they plan to help their audience with the execution of tax planning in the future, and the vision they have for the coming year.
Listen in to hear where they personally plan to create a bigger impact and how they set up the planning for that impact. You’ll learn the shifts they are making and how they plan to provide new, improved resources in the coming year, as well as where you can get the help you need—from webinars with real-time examples and access to tax planning strategy and more.
What You’ll Learn In Today’s Episode:
Read The Transcript Below:
Benjamin Brandt: Welcome back to the Retirement Tax Podcast. I’m your humble co-host, as always, Benjamin Brandt. And sharing the stage with me here as our other co-host, Steven Jarvis. Welcome.
Steven Jarvis: Ben, it’s so great to be here with you. I’m really excited to be recording this podcast. It’s actually a little bit weird to be talking to you virtually. We got to spend some time in person recently, and that was always a lot of fun.
Benjamin Brandt: Well, I could never squander the opportunity to use a dad joke, so I feel like I haven’t seen you since last year.
Steven Jarvis: Yes. Well, you and I are kindred spirits on that then, because my kids are already sick of the number of jokes that I have made about, “Oh geez, we haven’t done that all year.”
Benjamin Brandt: Yes, yes, absolutely. So, we got to spend some time in Las Vegas for a mastermind group as well as some business planning, and we got to do some peak experiences.
One fun thing about business planning is you also have to do some peak experiences together, because that’s great for team bonding and team building and things like that.
So, some of the fun things that we got to do was there is a racing experience in Las Vegas. We’re on a track where you can race exotic cars. So, we got to race Lamborghinis, which was a lot of fun. Something I never thought that I would do.
I’d love to see the insurance contract that I didn’t read but signed, what would happen if I did wreck that car. Would be really interesting explaining that to my wife.
And then we also had to do indoor skydiving. So, that’s as close as skydiving as I’ll ever get. Is sort of face down over a windscreen, over a wind turbine. But very fun.
If you’re ever in Las Vegas, I would check out both of those things. I can’t wait to try them again with my kids.
So, but in between peak experiences, we got to talk with some really interesting things that we’re going to bring to our audience in 2023. So, let’s maybe dig into that Now, we can’t share everything right away. Some of it’s still top secret, but let’s share what we can.
Steven Jarvis: Yeah, definitely really excited about this year for all sorts of reasons. As we record this, a book I wrote actually just published, Don’t Get Killed on Taxes, it was written for taxpayers.
And the reason I highlight that, even though it’s separate from the podcast that you and I do together, it really reinforces why you and I are here together at all. We’re here together because it’s this shared mission, this drive to help individual people to have an impact for people who are planning for the future, planning for retirement.
Specifically, you and I get together and talk a lot about taxes, but at the end of the day, we’re trying to give people through the podcast information and through some of these other things we’re going to talk about, resources and opportunities to really do something that helps them not get killed in taxes, helps them pay just what they owe and not leave the IRS a tip so they can accomplish their other goals.
And so, that’s a shared passion that you and I have that really brought us together.
Benjamin Brandt: Right. And I’ve had some pretty significant changes with how I thought I would make my impact on my career and on my profession. And just quote Steve Jobs, “Make my dent on the universe.”
So, I’m making some changes in my life in 2023. And one of those is going to be expanding how I can help people. Some of that we can’t fully talk about right now, but I made the career goal to help a million people retire. How can I have a meaningful impact on the retirement of 1 million people, a million retirements?
And of course, I don’t mean working with a million clients. I mean, that would limit my impact because there’s only so many hours in a day. So, I want to record more podcasts, reach a wider audience.
And there’s some books that we’re going to write Steven and I together, and then myself individually, as well as online courses and things like that, training financial advisors. And then some other top-secret things that we will hopefully discuss later this year.
One of the ways that we can expand our impact, there’s just some topics that are better discussed over video. And of course, we’re limited technology-wise with the podcast.
So, one of the things that we’re going to do in 2023, and we’ve borrowed this from, or we got this idea from our listener survey, also visiting with some listeners one-on-one, is that listeners want to go deeper on some of these topics.
So, rather than doing the standalone episode for 20 minutes and then a different standalone episode the next time, and different the next time, we want to do episode arcs.
So, what that would look like in our minds is like a three-episode arc. The first two episodes, episodes A and B would be in traditional podcast format, and then episode C would be a webinar, where we would be able to demonstrate these things.
So, especially with tax things where we’re maybe showing you a form or maybe showing you a chart where the friendly parts of the marginal income tax brackets are and things like that — or even just sketching out what it might look like to double up our charitable giving one year and not do anything the next year.
And then there might be even a top-secret fourth step that we’ll talk about at some point in the future.
So, again, what we can do to make our show better is just listen to the listeners and give to you what you’re asking for. So, one of those things in 2023 is to do multiple episode arcs, to deliver even more value around tax planning and retirement planning.
Steven Jarvis: Yeah, Ben, and that’s definitely a big part of the reason I’m excited for this year. I mean, we’ve been doing this together for almost a year and a half.
We started in the fall of 2021 and I mean, thousands of people listened to every episode of the show, which is great. It’s exciting. We’re getting to share a lot of information. But really, that next step is empowering people to take action.
And hearing from our listeners, we know that there are people out there who are very, very fervent DIYers and we love hearing the people are able to take the information we share and they’re able to do something about it.
But we also know that there are people who want that extra, that step. They want that guide to walk along with them to say, “Here’s how you implement this.” Especially as tax laws keep changing, they keep getting more challenging to deal with.
I mean, as we record this, just a couple weeks ago, Congress passed their most recent bill that has tax law implications. And definitely tune into our next episode where we’ll dive into that a little bit deeper.
But personally, I’m not very optimistic that taxes ever just suddenly get simple at some point in the future. And so, it’s not just how do you and I keep getting together and chatting about these things and sharing our thoughts (which we are absolutely going to do), it’s how do we take that to that next level.
And later this spring, getting towards summer, we’re going to have our first opportunity to do that, to really engage with people and add that visual element to it.
Benjamin Brandt: Absolutely. Well, maybe this would be the right time to share our vision of what the top-secret part would be. What do you think, Steven?
Steven Jarvis: Yeah, you know what, Ben, let’s go for it. Happy New Year to everyone. Let’s just let them in on kind of what we’ve got planned.
Benjamin Brandt: Okay. Well, one of the dreams has always been as we deliver tax value through podcasting, we have already identified financial advisors that deliver this value.
So, we have a lot of listeners that listen to this show, and we have a lot of financial advisors that Steven and myself, to a much smaller extent, are educating on how to be tax-wise retirement guides.
So, we said, “What a wonderful opportunity for us to connect these two people, the financial advisors that we coach and mentor, and the listeners that are clamoring for this hybrid retirement planning and tax advice.”
So, that’s one of the things that we’ll be rolling out later in 2023, is an opportunity to connect those two dots, connect these highly motivated, highly skilled advisors with taxpayers that really want some top-shelf advice.
So, whether that be hourly planning, whether that be a fee for a plan, whether that be ongoing planning. Whatever level you want to work with an advisor, we know rockstar advisors that have capacity in their firms to take on new clients and are very, very excited to work with our listeners.
So, we’re going to be making those connections in 2023.
Steven Jarvis: And maybe to shed a little bit more light on kind of where that came from. Ben and I didn’t just go out and start knocking on doors looking for advisors who might be up for the challenge.
Through Retirement Tax Services, which is a firm that I created in 2021 alongside some other financial advisors to really take tax planning, take tax preparation in a different direction than what most firms are doing.
And what we said is that there’s so much value when professionals collaborate together. One, if we created a tax firm where great advisors like Ben as an example have somebody they can collaborate directly with so that their financial planning goes in lockstep with the tax preparation, the tax planning.
And so, what Retirement Tax Services does, which is what I do in all of my time that I’m not podcasting with Ben, is spends time not just working with taxpayers and helping them improve their tax plan, their tax preparation, but to, Ben, as you mentioned, we spend all of this time, all this energy and resources on helping advisors deliver more value through tax planning.
And so, when we talk about the potential of partnering a listener of our show who is interested in having someone walk alongside them with a financial advisor who’s going to be able to do that for them, these are advisors that through Retirement Tax Services, we have already partnered with.
We’ve worked directly together on some of their existing clients. We can see the work that the advisor is doing, and we know they take tax planning very seriously and are incorporating that into what they do.
And even though I’m the tax guy, I know that taxes aren’t the only thing that counts. But one of the reasons, Ben, and you bring this up quite often, I think very eloquently — that one of the reasons we focus so much on taxes is for most people, this is going to be one of their biggest, if not their single biggest expense sometimes during their career definitely in retirement.
So, we put such huge emphasis on this because if it’s done right, it can certainly have a big impact on the overall outcome of someone’s ability to accomplish their bigger goals.
Benjamin Brandt: Right. Yeah. Most retirees, if you’ve saved up half a million or a million dollars, and that’s going to be where you collect your retirement income over the course of your life (and that’s one of the things that kicked off this podcast), you’re going to pay a high six or a low seven figure lifetime tax bill.
So, we’re really excited to start to introduce some of the advisors that can help you shave the rough edges off, sand the rough edges off that biggest bill that you’re going to pay, so.
Steven Jarvis: Yeah, another example I’d love to share of where the power of this comes from, there’s so much out there, so many headlines, so many podcasts, so many articles around tax planning topics.
But it’s really hard to at times translate those headlines into, “Okay, what do I need to do today to implement this strategy? What do I need to do each year for the next 5, 10, 15 years? How do I make sure this is successful?”
And while we do the best job we can to articulate those things on this podcast, there are limits to how far we can take that even for us.
And so, a recent example of this as I was working with one of these advisors who partners with Retirement Tax Services, we were working with a client on the idea of funding a donor-advised fund. This is one of those ways that we can really maximize the tax benefit of giving to charity.
Now, we’ve done whole episodes on this, we’ll talk about it again in the future. There’s definitely some really important nuance we need to keep in mind to decide if this is an effective strategy.
But a lot of times what happens is people hear the idea and they think, “Yep, that’s for me, let’s go do it.” Or they think, “I have no idea what the next step is.”
But being able to sit down with this advisor and walk through, not just whether this idea was a fit for the client, but, “Okay, here’s when the donor-advised fund needs to get funded. Here’s the amount that makes sense this year. And since we’re funding this donor-advised fund in 2022, here’s what charitable giving in 2023 and 2024 and 2025 need to look like.”
And so, we have the action steps that need to happen right away, and we have a plan for what’s going to happen over the next few years to make sure this is successful each and every year.
And you’re never going to get all of that detail out of a one or two or three-page article. Really for your specific situation, you’re not going to get all of that out of a single podcast episode either.
Again, for some of our real fervent DIYers out there, you might have this question and we’re so happy to keep sharing that information so that you can keep doing that.
But what we’ve found from the feedback we get, is that there are a lot of people who are looking for who’s going to help me actually on the execution.
Benjamin Brandt: Right. Yeah. And just so our audience knows that as a firm, we put our money where our mouth is. Steven, do you remember who your first RTS client was?
Steven Jarvis: Oh, Ben, I’ll never forget. It was definitely your firm and all of our friends there in North Dakota and throughout the country that you serve.
Benjamin Brandt: That’s right. So, just, we eat our own cooking in North Dakota. So, I was thrilled to be working with Steven on RTS. And now, I’m thrilled to connect even more people through the podcast, so I couldn’t be more excited.
Well, so, I think maybe that’s a good opportunity since we’re talking about connecting financial advisors with taxpayers, to pivot into a listener question.
So, a listener writes in, “I’m unhappy with my financial advisor, but I’m concerned about changing to a new unknown financial advisor and the tax implications that it will have on my non-tax deferred accounts. What do you recommend?” Writes the listener.
So, what I think the listener’s asking is, I’ve got money that’s not in an IRA, it’s got a deferred gain, I want to switch advisors, but I don’t necessarily want to realize all that gain. What are my options? So, what are your first thoughts, Steven?
Steven Jarvis: Yeah. This is such a great question and just one example of the types of questions we’re getting that really push us in this direction of what we’re going to be doing in 2023.
To me, the first thing that I love about this question is the listener clearly knows that there’s a tax implication or there’s potentially a tax implication of just about any money decision we make.
And I love it when people ask these questions up front instead of telling me after the fact, “Here’s what I already did. Now, what are our options?” Because this is definitely an example of where having a plan front can make a huge difference on the outcome, because this is going to be very situational.
And Ben, you’re going to be able to speak more to the logistics of this because I’ve never been a financial advisor. I’ve seen how this works, but I’ve never moved the paperwork myself. Because you don’t just have your financial advisor, you have the custodian or the company that holds your investments.
And so, there are ways to change advisors without having to necessarily directly have tax implications. That’s one potential outcome of this, of a potential transition between financial advisors.
Now, there certainly are situations where you might even want to recognize taxable events as you change advisors or that your new advisor might have recommendations that are going to cause that to happen.
But anytime we’re looking at changing professionals, whether it’s financial advisor, tax preparer, or other service professional in your life, what I always start with is make sure that you have a list of questions that you’re going in with to make sure that you are vetting whether or not this person is someone who’s going to think about all the things that you care about.
And so, this is certainly a question that, Ben, I mean, I would just love to hear your answer. If you had a potential client coming to you and saying, “Hey, Ben, I’ve listened to your podcast. I’m so excited about what you do, but here’s one of my concerns. What’s this going to mean from a tax standpoint if I come and work with you?”
Benjamin Brandt: Right. So, if a client is transferring money from a custodian to a custodian, let’s say it’s Charles Schwab to Fidelity, or Vanguard to Ameriprise, or something like that, most of the time …
So, if we’re talking about IRAs, Roth IRAs, things like that, even if selling needs to take place before the transfer and then rebuying needs to take place, that’s not going to be a taxable event because we’re doing what’s called a rollover. We’re moving money from an IRA to an IRA at a different custodian.
So, that part is not a concern. And I think the listener recognizes that because they talk about their non-tax deferred accounts. So, they’re talking likely about a brokerage account.
So, let’s just say you own 500 shares of XYZ Mutual Fund. Now, if that is a widely traded mutual fund, meaning I can buy it on Vanguard’s platform and Fidelity and Schwab’s platform, well, then those shares can simply transfer in-kind.
So, your 500 shares at Charles Schwab becomes 500 shares of the exact same mutual fund at Fidelity. That’s not going to be a taxable event, that’s transferring in-kind.
You might ask about an ACAT, A-C-A-T transfer. Now, where we sometimes run into trouble is with proprietary funds. So, if I have at Jim Bob’s Mutual Funds Incorporated, his proprietary shares, I can’t transfer those to Fidelity because they’re not widely traded on whatever exchange that’s proprietary Jim Bob’s mutual fund warehouse. So, that would be a taxable event.
If I want to take that then to a different custodian, Charles Schwab, I would’ve to sell those, turn it into cash taxable event, transfer the cash, and then rebuy whatever my new long-term positions are going to be.
So, like Steven said, you want to figure that out ahead of time. Once we do that and then we find our new advisor at Charles Schwab and say, “What do we do now?” You can’t really put that cat back in the bag.
You’ve already sold that. You’ve already realized those taxes, maybe there’s something you can do, find charitable things in the future or something, or we can maybe offset some of that. But once it’s done, it’s done.
It’s sort of like the calendar flipping over. Once the calendar flips over, a lot of those things have kind of gotten away from us and are kind of sealed in that year. Same thing with tax stuff. Once we sell our security, we realize that gain or loss.
So, you want to look at transfer in-kind, you want to make sure that you pick a custodian that can receive all of your investment. That goes for mutual funds, ETFs, it goes for single stock securities, individual stocks, things like that. Most of those things, if they’re widely known, can just transfer in-kind.
So, hopefully, this problem won’t even become a problem. We just have to measure it twice and cut once and visit with that new advisor before we make the transfers and all those sorts of things. So, measure twice, cut once, be prudent, and ask a lot of questions.
Steven Jarvis: Yeah. So, I think the takeaway for our general listeners here is that, like so many other things, taxes shouldn’t be the only consideration. And thankfully in this case, taxes don’t have to be the barrier to making this decision.
We want to understand the situation, we want to understand the specifics of what’s going on in a particular client’s life before they make this move. But taxes are just going to be one of the considerations.
And like you described, Ben, there’s potential outcomes here where there are no tax implications of necessarily changing financial advisors.
Benjamin Brandt: Yep. Read all the fine print, check on the fees, run your advisor’s broker check and do your due diligence. Of course, if you decide to choose one of our tax-wise retirement guides that we’ll talk about in the future, we’ll be doing some of that due diligence on your behalf. But we recommend you do it as well.
But thanks for writing in and that’s a fantastic question and very timely for our other topics we discussed today.
So, Steven, as always, it’s a pleasure co-hosting the show with you. I think we delivered some great value today.
And until next time, don’t let the tax man hit you where the good Lord split you.
Hi, everyone. Quick reminder before you go. While Ben and I feel very strongly about the information we’re sharing on this podcast, it is for educational purposes only and should not be taken as specific tax, investment, or legal advice. You need to make sure that you are working with a professional to evaluate how these concepts apply to your specific situation before you take action.
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