IMPACT Day 1 featured two main sessions addressing issues of importance for Financial Advisors.
Jeffrey Levine addressed advanced Roth planning, and offered tactical strategies.
The keynote featured a discussion on the outlook for markets.
Welcome to Seeking Alpha’s coverage of the 2019 IMPACT Conference! This is the first article that will highlight the broad themes discussed at this event relevant to our readers.
What is IMPACT?
The IMPACT Conference is an annual event catering to financial advisors and their pursuit of better service for their clients. The draws of the event are the breakout sessions and seminars designed to strengthen advisors’ skill sets and improve their understanding of the recent changes affecting the industry. Our role here will be mainly to distill insights for our readers based on the breakout sessions and conversations with fellow attendees.
Advanced Roth Planning: How To Squeeze More Tax Juice Out Of The Lemon
The first session was hosted by Jeffrey Levine, CPA/PFS, CFP®, CWS®, MSA, Director Of Advisor Education at Kitces.com (the leading website for financial planner and investment advisor education) and Director of Financial Planning for BluePrint Wealth Alliance. In this session, Levine discussed how advisors can leverage the Roth IRA to save their clients money over time.
The overall theme of this session is how advisors can use Roth IRAs as a tool for efficient tax planning. Levine even considered Roth IRAs as a sort of “insurance” against future tax rate increases. An often overlooked fact is that assets held in a Roth IRA and a Traditional IRA are not equal in value (given that the distributions from the former are tax-free).
However, high income-earning individuals are not privy to contribute to a Roth IRA due to income restrictions, but can convert most other qualified retirement plans to take advantage of the Roth IRA’s tax-friendly characteristics.
Levine provided several actionable strategies that high income-earning individuals could use to take advantage of the Roth IRA’s structure. He also discussed situations when these conversions would be ideal (e.g. clients with certain years of lower gross income than usual and clients moving to states with higher taxes). Levine touched on how clients can use Roth conversions to avoid estate tax transfers and gave his opinion on whether Roth accounts would exist in the future (a concern for many clients). He directed those looking for more information on the topic to this paper.
The Markets, the World and Your Clients
For the final event of the short kickoff day, Jeffrey Kleintop and Liz Ann Sonders gave their outlook for 2020. Kleintop focused on the broader economy, while Sonders focused on the US. Their view was ‘cautiously optimistic.’
Kleintop believes that the influence of central bankers will be less impactful than consumer spending and manufacturing. His main concern is that a decline in business investment (which is currently happening) would eventually lead to workers losing their jobs (which isn’t currently happening). Job loss, in his view, would send us into a recession. Sonders supported Kleintop’s argument and showed the audience a few economic indicators flashing warning signals. She discussed more about her outlook in this podcast.
We’ll be back tomorrow with highlights from Day 2!