Things Are About To Change

Jan 19, 2021 | Estate Planning, Financial Planning, Retirement, Tax

A new administration is going to mean some big changes for your finances. Karl Eggerss joined Trey Ware to discuss what some of the changes will be.

Trey Ware:                         Roofing Newsmaker Hotline from CreatingRicherLives.com. Karl Eggerss joins us, even on a holiday he gets up and makes things happen. I guess the market’s closed today, right?

Karl Eggerss:                      It is closed. I was thinking, Trey, you should have the Karl Eggerss Tweet of the Day for 2021. You could do that.

Trey Ware:                         Okay. All right. What I’ll do is, I will run that through the people who actually control my life, and I’ll see what they tell me.

Karl Eggerss:                      Does your wife make those decisions?

Trey Ware:                         Well, some of them, she does make some of them, but not concerning the show. But anyway, happy Monday to you, man. It’s a very slow day, easy-going kind of day because it’s the MLK day holiday. Everybody’s going to be off, the market’s going to be closed. But I hear wind, that there is a change coming on Wednesday. Do you know anything about this?

Karl Eggerss:                      I do. And it’s making our lives challenging because people are looking at all these events going on, they’re looking at the markets. But there’s going to be a lot of planning that needs to take place this year for all of our listeners, and it doesn’t just affect people quote unquote, the wealthy, making over $400,000 a year. This is going to affect everybody. We don’t know what the rules of the game are going to be yet. And so once we have a clearer picture, it’s going to be a lot of planning.

You’re talking about potential capital gains tax changes. You’re talking about changes that could affect real estate investors. They’re talking about doing away with what’s called the 1031 exchange, which is something where you can basically sell an appreciated property, put it into another one, and you defer taxes, if you follow some simple steps. They may eliminate that, so you could see a lot of changes in real estate and it’s really going to affect investments, and it’s going to affect financial planning, estate planning. There’s a lot of things coming up. And so, this year is going to be financial planners, CPAs are going to be very busy, and the state planners are going to be very busy this year.

Trey Ware:                         What you’re saying is, the Biden administration has committed to spending a ton of money, a lot of money. And there’s only one way to get it. And that’s to come to the American citizens, to working American citizens, producing American citizens, which tend to be middle to upper class, and take more from them.

Karl Eggerss:                      Well, it’s not only that, because if you say, “Well, the wealthy should be paying for this.” If that’s your view, just realize that most businesses in the United States, as we know, are small businesses. And so if your employer’s one of those people, do you think you’re going to get a raise, or you’re going to see more matching on your 401k? And so it trickles down when you have these corporate tax rates go up, when you have taxes, go up on wealthier individuals, it trickles down. And so everybody’s going to be affected by this. And there’s a lot of stuff to pay for, and you’re right. It looks like it’s coming for most of us in the form of taxes, for sure.

Trey Ware:                         Yeah, yeah. Tell you what, let’s do over the coming weeks, let’s go ahead on our Monday time, let’s about what average Americans need to be doing to protect themselves from the increase that’s coming. And when I mean that, I mean the increase that they’re going to get out of their pocket, the decrease that you’re going to be bringing home in order to fund all these things that they want to. In a socialist country, there’s only one place to get it. And that’s from the people who are working to produce it. And that’s the plan under the Biden administration, as you lay it all out.

Thank you, Karl. That’s CreatingRicherLives.com, that’s Karl Eggerss. He’s here every Monday at this time and beginning next week, we will do that. We will start to break that down for you, what you need to be doing and thinking about, in order to protect your nest egg and protect your money.

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