Gilbert Wealth Articles

Understanding Per Stirpes: A Guide with Examples

Estate planning is a critical process that ensures your assets are distributed according to your wishes after you pass away. One important concept in estate planning is "per stirpes." This legal term, derived from Latin, means "by branch" and plays a significant role in how your estate may be divided among your heirs. This article will explain the concept of per stirpes, provide examples to illustrate its application, and discuss how and where per stirpes can be included in your estate planning documents. Additionally, we will explore the implications of minors inheriting under a per stirpes distribution.What is Per Stirpes?Per stirpes…
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Understanding AGI, Taxable Income, MAGI, and Provisional Income

In the realm of personal finance and taxation, several key terms frequently arise that are crucial to understanding how your income is calculated and taxed. Four of these terms are Adjusted Gross Income (AGI), Taxable Income, Modified Adjusted Gross Income (MAGI), and Provisional Income. Each plays a distinct role in determining your tax obligations and eligibility for various credits and deductions. This primer aims to provide a comprehensive overview of these concepts.Adjusted Gross Income (AGI)Adjusted Gross Income (AGI) is a critical figure in your tax calculations. While you are not taxed on AGI, serves as the starting point for determining…
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Pre-Tax Net Wealth versus After-Tax Net Wealth

comprehending the distinctions between pre-tax net wealth and after-tax net wealth is crucial for accurate financial planning and decision-making. Both metrics are pivotal in understanding one’s true financial position, but they differ significantly due to the impact of taxation.  Consider two households: one had $1,000,000 in traditional IRAs and the other has $1,000,000 in Roth IRA's. While their pre-tax net wealth is the same, they have very different after-tax net wealth. Pre-Tax Net Wealth Pre-tax net wealth refers to the total value of an individual’s assets before any taxes have been deducted. This includes savings in retirement accounts like 401(k)s…
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Understanding the Taxation of 529 Plans for Non-Qualified Expenses or Closure

A 529 plan is a tax-advantaged savings plan designed to encourage saving for future education costs. Named after Section 529 of the Internal Revenue Code, these plans are sponsored by states, state agencies, or educational institutions and offer tax benefits when used for qualified education expenses.But what happens if you have to withdraw money for reasons other than qualified education expenses? Or what happens if you no longer want or need the 529 plan and want to close it?Using 529 funds for non-qualified expenses can result in tax consequences. This article will delve into the taxation aspects, including the 10%…
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The Original 4% Rule Explained

When it comes to planning for retirement income, you do not have to look very far in financial blogs and forums to find the 4% Rule and for good reason. The 4% Rule ushered in a new era of modeling techniques for financial planners to help people navigate what their retirement might look like in the future and how they can safely spend their accumulated resources over a long and uncertain timeframe.The 4% rule was developed by financial planner William Bengen in the early 1990s. Bengen's work, first published in 1994 in the Journal of Financial Planning, was a response…
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The Basic Types of Annuities

Annuities are contracts with an insurance company that provide certain benefits. There are many types of annuities out there and the terminology and usage can be confusing. This article provides and overview of the basic types of annuities and their variations. Quick Annuity Primer Base Contract: Every annuity starts with a base contract. The base contract has certain guarantees embedded it such as minimum interest rates, annuitization factors, fees, surrender charges, how the cash value can be invested. Riders: Some annuities have the option to add riders. Riders are additional features that can be added to the base contract to provide additional…
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10 Ways a 529 Can Be Used

A 529 plan is a tax-advantaged savings plan designed to encourage saving for future education costs. These plans are sponsored by states, state agencies, or educational institutions and offer flexibility and a range of benefits to families aiming to secure their children's educational future. This guide explores not only the domestic uses of a 529 plan but also its applicability to international educational pursuits.1. Tuition and FeesThe primary use of a 529 plan is to cover tuition and fees at eligible educational institutions. This includes:Colleges and Universities: Both in-state and out-of-state, public and private institutions.Community College: Community college schools are eligible.Graduate…
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6 Biblical Principles of Work

Work is a central theme in the Bible, underscored from the very beginning of the scriptural narrative. The biblical principles of work are deeply intertwined with the theological understanding of human purpose, dignity, and relationship with God. This article explores these principles, examining how work is viewed through the lens of biblical teaching. The Lord God took man and placed him in the garden to... The concept of work started from the very beginning of the world. God did not finish all of the creation and then tell mankind that they should sit back and enjoy the views."The Lord God took…
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The Sunset of the Tax Cuts and Jobs Act: What You Need to Know

NOTE - This article is no longer applicable due to the passing of the One Big Beautiful Bill in 2025. It is posted only for reference and historical context. I did say tax laws are written in pencil right?!As the saying goes, “tax laws are written in pencil”. Indeed, the landscape of taxation is in constant flux, necessitating an ongoing awareness and adaptability to change. As we approach the expiration date, I wanted to describe in more detail the changes that are being made. This is not a comprehensive list but does cover the changes that are most impactful.Authors Opinion: Before…
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Common Features of Traditional Long-Term Care Policies

Long-term care (LTC) policies are financial tools designed to cover expenses associated with long-term care services. These services are often necessary for individuals who are unable to perform basic activities of daily living (ADLs) due to chronic illness, disability, or cognitive impairment. Traditional long-term care insurance policies have several common features that are essential for potential policyholders to understand. This article provides an overview of features commonly found with Traditional Long-Term Care Policies. This list is not exhaustive and policies issued by companies may deviate from the descriptions provided. It is important to review your own policies for complete descriptions and…
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