Here’s what gets you business:
- Knowing things other advisors don’t know
- Providing solutions other advisors don’t provide
- Coming up with ideas that other advisors could never come up with
- Being the only advisor that can put the client in a better position
So what are you doing to accomplish those things? Here’s a quiz right out of the Journal of Financial Service Professionals, on ROTH IRA Distributions. How many of these True/False questions can you answer correctly? (Answers below article)
- A distribution of earnings from a Roth IRA can be taxable to the participant after age 59 ½.
- A distribution of earnings from a Roth IRA paid to a spouse due to the death of the participant, which the spouse then claimed as his/her own Roth IRA, qualifies as an exception and therefore is not subject to taxes or the 10% penalty.
- When a contribution to a Roth IRA is distributed back to the participant, it can never be subject to taxes or the 10% penalty.
- In January 2006, Jane, age 51, made a $5,000 contribution to her Roth IRA for the calendar year 2006. When also made a $5,000 conversion to the same account in 2007, 2008, and 2009. These were all the deposits she made to her Roth IRA. In March of 2012, Jane’s account was worth $23,000, and Jane received a distribution of $20,000 from her Roth IRA to purchase a new car. $10,000 of the distribution would be subject to the 10% penalty but the entire $20,000 would not be subject to income taxes.
- Each contribution to a Roth IRA must remain segregated from an accounting standpoint due t the five-year waiting period.
So what can you do to use your knowledge of Roth IRA distributions? Use it in your elevator speech. Use it in the referral spiel you give your clients to talk about you with. Use it in your newsletters. Use it in your marketing. Set yourself apart from your competition.
1) True 2) True 3) True 4) True 5) False
Source: Journal of Financial Service Professionals, January 2012, “Roth IRA Distributions: HOF Accounting and the Three Layer Gravy, by Jordan P. Gates, MSFS, CFP, ChFC, CFS