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Author: support@seostats.com

Mindset Shifts That Can Speed Up Your Path to Financial Independence

Written by support@seostats.com on . Posted in Behavioral Finance, Financial Planning.

Have you ever wondered why some people achieve financial freedom with relative ease while others struggle to make progress, no matter how much they earn? It can sometimes seem like a real mystery. You might assume your neighbors, coworkers, or college friends must be getting lucky: a big inheritance, a winning lottery ticket, or maybe a side hustle you don’t know about. Sure, that’s possible. But there’s also a good chance that they’re following a solid plan. 

For many mid-career professionals, income isn’t the biggest problem; discipline is. If you’re advancing in your career but still feel behind with money, it may be time to apply the same intentional focus you bring to your job performance to your personal financial life. 

The right mindset can make a big difference. Below are a few shifts that can help you avoid lifestyle creep, build better habits, and move more confidently toward financial independence.

Aim for Progress, Not Perfection

Financial independence doesn’t occur suddenly at a single finish line; it develops from a series of steps that build momentum over time. Many people get stuck in the “all-or-nothing” trap, thinking they need to max out every savings account or pay off every debt before they’re allowed to feel progress. That thinking can lead to burnout and frustration.

Behavioral finance research shows that people tend to overestimate what they can accomplish in a given day but underestimate what they can achieve in a decade. Small, consistent wins, like automating savings, tracking progress quarterly, or trimming one expense category, add up faster than you think.  

One simple way to start: set up an automatic transfer to your savings account on payday. If you already do this, try bumping up the amount. Celebrate your wins along the way, such as hitting your first $100,000 or paying off a credit card, rather than waiting to pat yourself on the back only when you’ve “made it.”

Understanding behavioral finance can help you reframe your expectations because it acknowledges that human decision-making often deviates from rational models. We’re all subject to emotional biases that can lead to choices that hold us back financially, such as fearing losses more than valuing gains or following the herd when markets fluctuate. 

Recognizing that these biases exist empowers you to challenge them; you don’t have to let them dictate your actions. By embracing progress over perfection, you can avoid the paralysis that comes from trying to “time” everything perfectly and instead focus on consistent, long-term steps that build wealth.

When you value progress over perfection, you sidestep the paralysis of trying to get everything exactly right. This is what will ultimately lead to more effective and sustainable financial habits.

Break the Cycle of Lifestyle Inflation

As your income grows, it’s natural to want to enjoy more comfort—maybe a nicer car, bigger house, or better vacations. There’s nothing wrong with that, but letting lifestyle expenses rise in lockstep with your income can stall your journey toward financial independence. Unfortunately, as you adjust to a higher standard of living, the happiness boost from new purchases fades. Before long, what once felt like a treat becomes your new baseline, and you’re left craving even more.

Then there’s the social pressure. “Keeping up with the Joneses” is more real than we like to admit—and it’s amplified by social media. It’s fueled by a desire for social status and a sense of belonging. Seeing others’ curated highlights can create the urge to spend just to feel like we’re doing as well as everyone else. The constant quest for higher status through material possessions can be an insatiable cycle, leaving even high earners feeling dissatisfied.

In modern, consumer-driven societies, people often define themselves by what they own, rather than by their experiences or contributions. This leads to conspicuous consumption, where spending is driven more by the desire to impress others and dispel inadequacy than by personal fulfillment. When you start making financial decisions based on appearances rather than purpose, you divert energy and resources away from what truly matters—your family’s future, memorable experiences, and long-term security. 

To break this pattern, start by identifying what matters most to you. Write down your top three financial goals and revisit them monthly. Maybe it’s taking time off with your family, supporting your children’s education, or reaching work-optional status sooner.

Then, when a big spending decision comes up, ask yourself: Is this moving me closer to my goals—or is it just keeping up appearances?

Keeping your values front and center helps you resist the pull of short-term gratification and stay aligned with a life that’s both financially free and deeply meaningful.

Rely on Automation Instead of Willpower

Willpower is a limited resource. That’s why systems and automation are the real heroes of building financial independence. When savings, investments, and even bill payments happen automatically, you remove friction and reduce the risk of falling off track. This approach helps overcome a common psychological challenge known as present bias, the tendency to favor immediate rewards over long-term benefits.

We’ve all been there: choosing online shopping over saving or skipping the gym in favor of the couch. Present bias makes us focus on what feels good right now, even if it means paying more in the long run. It’s why so many people struggle to stick to savings plans, despite knowing the power of compounding. Present bias makes us reactive. Automation makes us proactive.

Take the guesswork out of it by setting up automatic transfers from your checking account to savings or investments right after payday. Use a “pay yourself first” approach, treating savings like a non-negotiable bill. This way, you see that your long-term goals are funded before your lifestyle expenses take over.

Automating promotes steady progress, even when life gets busy or unpredictable. Over time, these small, consistent steps will build a solid foundation of wealth without requiring constant willpower.

Big Financial Wins Start with Small, Consistent Changes

Financial independence is as much about mindset as it is about math. By embracing progress over perfection, keeping lifestyle inflation in check, aligning your spending with your values, and automating good habits, you can build wealth faster.

If you’d like help creating a plan that aligns with your goals and values, we’d be happy to talk it through with you. At Lake Road Advisors, we partner with professionals and families to make thoughtful, smart money decisions so you can focus more on what matters most.

Sources:

  1. https://www.investopedia.com/articles/02/112502.asp
  2. https://www.verywellmind.com/hedonic-adaptation-4156926
  3. https://www.chicagobooth.edu/review/why-keeping-up-with-joneses-is-problematic
  4. https://www.ebsco.com/research-starters/political-science/veblens-theory-conspicuous-consumption
  5. https://insidebe.com/articles/present-bias/

 

Lake Road Advisors, a Fee-Only, independent financial planning firm with offices in Corning, NY, Ithaca, NY, and Portland, OR, works with clients virtually all across the country. Paul Sydlansky, the founder of Lake Road Advisors LLC, has worked in the financial services industry for 20+ years. Prior to founding Lake Road Advisors, Paul worked at Morgan Stanley in Manhattan for 13 years. While at Morgan Stanley, Paul was a senior-level manager within the Institutional Equities Department. In 2018, he was named to Investopedia’s Top 100 Financial Advisors list. Paul received a Bachelor’s degree in Economics from Marist College and holds an MBA from New York University Leonard N. Stern School of Business. Paul is a CERTIFIED FINANCIAL PLANNER® and a member of the National Association of Personal Financial Advisors (NAPFA) and the XY Planning Network. They can be reached by phone at the Corning, NY office at (607) 438-2914, Ithaca, NY office at (607) 463-8400, or Portland, OR office at (607) 292-2172 or at the firm’s website at https://lakeroadadvisors.com/ 

This material has been prepared in collaboration with Crystal Marketing Solutions, LLC, and has been edited with the assistance of artificial intelligence tools. The information presented is based on sources believed to be reliable and accurate at the time of publication. This material is for educational purposes only and does not necessarily reflect the views of the author, presenter, or affiliated organizations. It should not be construed as investment, tax, legal, or other professional advice. Always consult a qualified professional regarding your specific situation before making any decisions.

SEP IRA vs. Solo 401(k): What’s Best for Self-Employed Retirement?

Written by support@seostats.com on . Posted in Business Owners, Retirement, Video.

If you’re self-employed or earning side income, you’ve got great options for retirement savings. This video compares SEP IRAs and Solo 401(k)s so you can see which one fits your situation best. Whether you want simplicity or flexibility, understanding your choices is key.

Topics Discussed:

  • SEP IRA basics and benefits
  • Solo 401(k) basics and benefits
  • Key differences in flexibility
  • Choosing based on income level

Transcript:

Hi everyone. It’s Paul Sydlansky, and welcome to Unlocking Hidden Value. If you’re running your own business, have a side hustle, or doing some consulting, today we’re going to talk about the best retirement vehicle for you.

The two vehicles we’re going to cover are the SEP IRA and the Solo 401(k). The SEP IRA is low-cost, very simple to set up, and allows you to contribute up to 25% of your net earnings to a maximum of about $70,000 per year. There is no Roth option, and there is no age 50 catch-up. A Solo 401(k) allows you to contribute up to about the same $70,000 per year amount, but you have a lot more flexibility because you only need to earn that $70,000 to be able to contribute that amount, while the Solo 401(k) might cost a little bit more, again, you have much more flexibility when it comes to how you’re going to contribute and when. So if you want simplicity and have a relatively high income, a SEP might be the right choice. If you want to maximize financial flexibility and have lower levels of income, a Solo 401(k) might be best for you. If you need help deciding, please reach out. We’re happy to help.

Lake Road Advisors, a Fee-Only, independent financial planning firm with offices in Corning, NY, Ithaca, NY, and Vancouver, WA, works with clients virtually all across the country. Paul Sydlansky, the founder of Lake Road Advisors LLC, has worked in the financial services industry for 20+ years. Prior to founding Lake Road Advisors, Paul worked at Morgan Stanley in Manhattan for 13 years. While at Morgan Stanley, Paul was a senior-level manager within the Institutional Equities Department. In 2018 he was named to Investopedia’s Top 100 Financial Advisors list. Paul received a Bachelor’s degree in Economics from Marist College and holds an MBA from New York University Leonard N. Stern School of Business. Paul is a CERTIFIED FINANCIAL PLANNER™ and a member of the National Association of Personal Financial Advisors (NAPFA) and the XY Planning Network. They can be reached by phone at the Corning, NY office at (607) 438-2914, Ithaca, NY office at (607) 463-8400, or Vancouver, WA office at (607) 292-2172 or at the firm’s website at https://lakeroadadvisors.com/

The information provided is for educational and informational purposes only and does not constitute investment advice and it should not be relied on as such. It should not be considered a solicitation to buy or an offer to sell a security. It does not take into account any investor’s particular investment objectives, strategies, tax status or investment horizon. You should consult your attorney or tax advisor.

College Bound? What Parents Need to Know About Student Privacy & Health Care

Written by support@seostats.com on . Posted in Education, Kids.

As summer unfolds and high school graduation becomes a freshly minted memory, families across the country are shifting their focus to college prep. From dorm checklists to course registration, there’s a lot to organize. One important step that often gets missed is preparing for your child’s healthcare needs and legal rights as they enter adulthood.

It might not be on your radar yet, but once your child turns 18 or begins college, you no longer have automatic access to their health information. Even if they’re still on your insurance plan and financially dependent on you, federal laws like FERPA (Family Educational Rights and Privacy Act) and HIPAA (Health Insurance Portability and Accountability Act) may limit your ability to access information or step in during a medical emergency unless the right forms are in place.

That shift can be surprising, especially in a moment when you want to be most helpful. The good news is, a little preparation can make all the difference.

In this article, I’ll cover what parents need to know about health insurance options for college students, how FERPA affects access to medical and academic records, and the key legal documents to have on file before your student heads to campus. It’s a practical and meaningful part of college prep that helps support both your peace of mind and your child’s independence.

Health Insurance Options for College Students

Before your child starts their college journey, it’s important to ensure they have reliable health coverage. There are several options available, each with its own benefits and considerations. Taking time now to compare them can help prevent unexpected bills later and ensure your student has access to care when they need it.

Health insurance might not be the most exciting part of college prep, but helping your child understand their options now can give both of you greater confidence and peace of mind.

Option 1: Staying on a Parent’s Plan

Thanks to the Affordable Care Act (ACA), students can remain on a parent’s health insurance plan until the age of 26. This applies regardless of marital status, whether they’re enrolled in school, or where they live. It’s often the simplest choice, keeping everything consistent and avoiding new enrollment processes.

However, it’s important to check the provider network. If the student is going to school out of state, nearby services might be considered out-of-network, which can lead to higher costs. Reviewing the provider directory and plan details in advance is key. Enrollment typically happens during your employer’s Open Enrollment Period or after a qualifying event, like a loss of other coverage.

Option 2: University-Sponsored Student Health Plans

In New York, university-sponsored plans are common and can be very cost-effective. Many institutions partner with private insurers to offer comprehensive coverage tailored to student needs, including primary care, specialists, mental health services, and prescription drugs. These ACA-compliant plans often include access to free or low-cost services at on-campus health centers.

Enrollment is often automatic unless the student opts out by showing proof of other coverage. Each university has its own requirements, which is why it’s a must that you consult the school’s health services or admissions office for plan details, deadlines, and the waiver process.

Option 3: ACA Marketplace Plans

If your child isn’t on your plan or a university plan, another option is a health plan through the ACA Marketplace. These plans are purchased individually, and subsidy eligibility depends on income, household size, and whether the student is claimed as a tax dependent. If listed as a dependent, the parent’s income affects subsidy eligibility, even if the student applies independently. If your student is attending college in a different state, be sure to double-check the plan’s network to ensure local coverage

Option 4: Public Health Programs

While Medicaid isn’t typically available to dependents in higher-income households, it may be an option in some unique situations. Students with disabilities, those in blended families supported by a lower-income parent, or those who aren’t tax dependents may qualify based on their own income and state rules.

What FERPA Means for Parents of College Students

Health insurance is just one part of the transition. Once your child begins college, your access to their academic, medical, and disciplinary records shifts in ways that can be unexpected. Many parents assume they’ll be kept in the loop, only to discover that federal privacy protections may prevent schools from sharing information. 

Let’s say your daughter is halfway through her first semester when you hear from a roommate, not the school, that she’s been hospitalized after a party. You call the health center and are told they can’t share anything. Or maybe your son suddenly stops responding, and you suspect something’s wrong, but the registrar’s office won’t even confirm whether he’s attending classes.

These situations, while difficult, are not uncommon. They highlight how FERPA works and why it’s important to plan ahead.

Understanding FERPA

The Family Educational Rights and Privacy Act (FERPA) is a federal law designed to protect the privacy of student education records. It gives students control over their personal information once they turn 18 or begin college. Even if you’re paying the tuition, providing insurance, or claiming your child on your taxes, you won’t automatically have access to their records unless they provide written consent.

FERPA covers a wide range of records maintained by the institution, including academic performance, financial aid, and in many cases, health information. Health records maintained by a college health clinic or counseling center are generally considered educational records, protected by FERPA, not HIPAA, the federal law that covers most medical records. That means if your child is hospitalized after a medical or mental health crisis, you could be left out of the loop unless your child has granted you access to those records.

Are There Any Exceptions?

There is a narrow exception to FERPA’s consent requirement that some parents may be able to use, but it’s not guaranteed. If your college student is under 21 and violates a law or campus policy related to alcohol or controlled substances, the school is permitted (but not required) to notify you.

Additionally, FERPA allows schools to disclose information from education records to a parent if the student is a financial dependent, as defined by the IRS. This means that if you claim your child on your tax return, the college may choose to share certain information with you, even without your child’s written consent. However, institutions are not obligated to do so, and many still prioritize student privacy unless a health or safety emergency arises. In practice, schools often encourage students to communicate directly with parents rather than rely on this provision.

The most effective way to stay involved is to talk to your student about completing a FERPA waiver. These forms are often available during orientation or through the registrar’s office. It’s a simple step that can make it easier to support your child when they need it most.

Essential Legal Documents to Prepare Before Move-In Day

Even if your child is doing great, having the right legal documents in place ensures you can step in if needed. These four are especially helpful:

  • HIPAA Authorization Form
    This allows you or another trusted adult to speak with healthcare providers and access medical records. Without it, hospitals may not be able to share any information, even in an emergency.
  • Healthcare Proxy / Medical Power of Attorney
    This gives your student a chance to name someone who can make medical decisions on their behalf if they can’t do so themselves.
  • Durable Power of Attorney
    This lets you help with legal or financial matters, like dealing with a landlord or bank, if your student is unable to manage them.
  • FERPA Waiver
    This form allows the college to share educational and select health-related information with you. It’s usually available through the school’s registrar.

Where to Get These Documents

An estate planning attorney can prepare these forms, or families can use reputable services like Mama Bear Legal Forms when a child turns 18. It’s a great idea to review everything together before the start of the school year.

Setting the Stage for a Smooth Transition

College is an exciting time filled with new experiences and growing independence. As a parent, your role shifts, but it’s still incredibly important. By choosing the right health coverage, understanding privacy rules like FERPA, and preparing essential documents, you’re helping your student thrive while making sure support is there if it’s needed.

If you’d like help with these decisions or have questions, I’m always happy to talk through options that make sense for your family.

 

This material has been prepared in collaboration with Crystal Marketing Solutions, LLC, and has been edited with the assistance of artificial intelligence tools. The information presented is based on sources believed to be reliable and accurate at the time of publication. This material is for educational purposes only and does not necessarily reflect the views of the author, presenter, or affiliated organizations. It should not be construed as investment, tax, legal, or other professional advice. Always consult a qualified professional regarding your specific situation before making any decisions.

Lake Road Advisors, a Fee-Only, independent financial planning firm with offices in Corning, NY, Ithaca, NY, and Vancouver, WA, works with clients virtually all across the country. Paul Sydlansky, the founder of Lake Road Advisors LLC, has worked in the financial services industry for 20+ years. Prior to founding Lake Road Advisors, Paul worked at Morgan Stanley in Manhattan for 13 years. While at Morgan Stanley, Paul was a senior-level manager within the Institutional Equities Department. In 2018 he was named to Investopedia’s Top 100 Financial Advisors list. Paul received a Bachelor’s degree in Economics from Marist College and holds an MBA from New York University Leonard N. Stern School of Business. Paul is a CERTIFIED FINANCIAL PLANNER™ and a member of the National Association of Personal Financial Advisors (NAPFA) and the XY Planning Network. They can be reached by phone at the Corning, NY office at (607) 438-2914, Ithaca, NY office at (607) 463-8400, or Vancouver, WA office at (607) 292-2172 or at the firm’s website at https://lakeroadadvisors.com/

Lump Sum vs Pension: Make the Right Choice for Your Family’s Future

Written by support@seostats.com on . Posted in Financial Planning.

In this episode of Unlocking Hidden Value, we explore the critical decision between taking a lump sum or opting for a pension in retirement. We’ll guide you through key considerations—returns, taxes, and legacy—to help you make an informed choice that aligns with your family’s goals.

Topics Discussed:

  • Fixed returns vs. market growth potential
  • Tax planning and flexibility
  • Legacy considerations for families
  • Aligning financial choices with personal values and goals

Transcript:

Lump sum versus pension. How do you decide? Like most good questions, it depends. In today’s Unlocking Hidden Value, we’re going to give you some criteria to think about when you make this decision. The lump sum versus pension decision is something that faces a lot of our clients. As in your retirement. When thinking about it, there’s a lot of things to factor in. The first is with a lump sum pension, you are locking in a fixed return for your life in perpetuity. However, if you are rolling it over into an IRA account, you are giving yourself the ability to outperform or gain more. So the first question is really on a return perspective, do you want to lock in a fixed rate or do you want to have the ability to grow those funds and maybe outperform you’re providing yourself more upside with, you’re providing yourself more upside by rolling it over. However, there’s more uncertainty.

The second area to consider is your flexibility and specifically around taxes. Locking in a pension gives you a steady monthly payment, but that also means that you have to pay taxes on that. Where a rollover, you decide when you take the money out and when you pay the taxes on it. This can give you a lot more flexibility when it comes to tax planning in retirement. The third thing to consider is legacy planning. If something were to happen to you and your spouse, the third thing to consider is legacy planning. If something were to happen to you or your spouse, that pension could disappear. Now with a lump sum, you have the ability to pass that on to future beneficiaries, thus preserving that value. In conclusion, the right decision is really what matters to you most. Is it flexibility? Is it taxes? Is it legacy? Or maybe it’s a combination of all of ’em. If you’re thinking about this decision and need help, feel free to reach out. If you’re thinking about this decision and need some assistance, feel free to reach out. We’re happy to help.

Lake Road Advisors, a Fee-Only, independent financial planning firm with offices in Corning, NY, Ithaca, NY and Portland, OR works with clients virtually all across the country. Paul Sydlansky, the founder of Lake Road Advisors LLC, has worked in the financial services industry for 20+ years. Prior to founding Lake Road Advisors, Paul worked at Morgan Stanley in Manhattan for 13 years. While at Morgan Stanley, Paul was a senior-level manager within the Institutional Equities Department. In 2018 he was named to Investopedia’s Top 100 Financial Advisors list. Paul received a Bachelor’s degree in Economics from Marist College and holds an MBA from New York University Leonard N. Stern School of Business. Paul is a CERTIFIED FINANCIAL PLANNER® and a member of the National Association of Personal Financial Advisors (NAPFA) and the XY Planning Network. They can be reached by phone at the Corning, NY office at (607) 438-2914, Ithaca, NY office at (607) 463-8400, or Portland, OR office at (607) 292-2172 or at the firm’s website at https://lakeroadadvisors.com/

 

Inherited a Traditional IRA? Key Steps to Manage Distributions and Avoid Mistakes

Written by support@seostats.com on . Posted in Financial Planning.

Over the next 25 years, an unprecedented wave of wealth—trillions of dollars—is expected to move from one generation to the next. Often referred to as “The Great Wealth Transfer,” this shift is already underway, with about $2.5 trillion passed down each year. By 2030, that number is projected to reach $3 trillion annually—and by 2046, $5 trillion a year. Generation X alone is positioned to inherit more than $14 trillion over the next decade, with Millennials and Gen Z close behind.  

Whether you’ve started receiving your portion of this or expect to be a beneficiary in the coming years, it’s important to know that receiving a legacy isn’t as simple as an executor handing over a pile of cash. It can be complicated—and if you’re not careful, costly.

Take a Traditional IRA, for example. If you’ve recently inherited one, you already know it’s not a typical windfall. It comes with distribution rules that are often misunderstood.

Why does this matter? Because misunderstanding the rules around inherited IRAs can result in unnecessary penalties or taxes paid. 

The good news? With the right guidance and practical tools, like our “How Must I Take Distributions From the Traditional IRA I Inherited?“ cheat sheet, you can navigate this process with clarity and confidence.

In this article, we’ll walk through the basics, explore key considerations, unpack common scenarios, and help you take your next steps with ease.

The Basics of Inheriting a Traditional IRA

Inheriting a Traditional IRA introduces a complex set of distribution rules that depend on your relationship to the original account owner. Every situation is unique, but one of the first and most important steps is determining whether you’re classified as an Eligible Designated Beneficiary (EDB) or a Non-Eligible Designated Beneficiary (NEDB).  

Since the passage of the SECURE Act in 2019, most non-spouse beneficiaries must follow the 10-Year Rule, which requires the entire account to be withdrawn within 10 years of the original owner’s death. However, certain beneficiaries, such as spouses, minor children, disabled individuals, and those less than 10 years younger than the deceased, may qualify for more flexible options, like stretching distributions over their own life expectancy.  

Even with these rules in place, how heirs handle inherited IRAs can vary widely. Some beneficiaries use the funds to meet immediate needs or pursue lifestyle goals, while others integrate the inheritance into a long-term financial strategy. The key is understanding your options from the outset—whether you’re transferring the account, selecting a distribution method, or planning for taxes.

Key Factors to Consider

Navigating the rules around inherited IRAs can feel overwhelming, especially during an already difficult time. To make things easier, we’ve provided a simple flowchart that walks you through the essential factors to consider. You can access it here. Here are a few key highlights: 

1. Determine Your Beneficiary Status

The first step is identifying whether you’re considered an Eligible Designated Beneficiary (EDB) or a Non-Eligible Designated Beneficiary (NEDB). This classification determines what distribution options are available to you.

For example, if you’re the spouse or minor child of the deceased account owner, you’re likely considered an EDB. Other examples include individuals who are disabled, chronically ill, or not more than 10 years younger than the account owner. On the other hand, if you’re an adult child, sibling, or another relative who doesn’t meet those criteria, you’re generally classified as a NEDB.

2. When Did the Owner Pass Away?

Next, determine the timing of the original owner’s death, specifically whether it occurred before or after their Required Beginning Date (RBD). The RBD is typically April 1 of the year following the year the owner turned 73. This date affects your distribution path.

If the owner passed away before their RBD, you may be able to follow the 10-Year Rule without taking annual Required Minimum Distributions (RMDs). If the owner passed away after their RBD, annual RMDs are generally required alongside depleting the account within 10 years.

3. Understanding the 10-Year Rule

Due to the SECURE Act, the 10-Year Rule now applies to most non-spouse beneficiaries. Under this rule, the account must be fully withdrawn by the end of the 10th year following the original owner’s death.

It’s important to think carefully about your withdrawal strategy. While the 10-Year Rule doesn’t require annual distributions, waiting until the final year can trigger a large lump-sum withdrawal—and a bigger tax bill.  Spreading distributions over several years can help balance your income more evenly and potentially minimize your overall tax burden. Planning your timeline thoughtfully can make a meaningful difference.

4. Required Minimum Distributions (RMDs)

If you’re an Eligible Designated Beneficiary, you may have the option to take annual RMDs based on your life expectancy instead of following the 10-Year Rule. This approach spreads distributions over a longer period, often resulting in lower yearly tax obligations.

For example, if you’re a 50-year-old spouse who inherits a Traditional IRA, you could calculate your RMDs using the IRS Single Life Expectancy Table, allowing for smaller annual withdrawals and greater flexibility over time.

By walking through these steps, you can better understand your responsibilities and options. Be sure to download the Inherited IRA Flowchart to help you visualize your decision points and stay on track.

Common Scenarios for Inherited IRAs

Inherited IRA rules can seem complex at first, but seeing how they apply in real-life situations can help bring clarity. Here are a few common scenarios:  

  • Surviving spouses generally have the most flexibility. You may choose to treat the IRA as your own, roll it into your existing IRA, or remain a beneficiary and delay taking distributions until the original owner would have turned 73. The best option often depends on factors like your age, income needs, and long-term retirement goals.
  • Adult children and other non-spouse beneficiaries will typically fall under the 10-Year Rule. That means the entire account must be distributed by the end of the 10th year following the owner’s death. While annual withdrawals aren’t required, waiting to take distributions could lead to a larger tax bill down the road.
  • If the account owner died prior to their Required Beginning Date (RBD), you may have additional flexibility, especially if you qualify as an Eligible Designated Beneficiary (EDB). In some cases, you might be able to stretch distributions over your own life expectancy instead of following the 10-Year Rule.

Each situation is different, and your options will depend on several factors, including your relationship to the deceased, your age, and the timing of their passing. Understanding these factors is essential for making informed, confident decisions.

Handle Your Inheritance with Clarity and Confidence

Managing an inherited IRA can feel overwhelming—but it doesn’t have to be. Our “How Must I Take Distributions From the Traditional IRA I Inherited?” cheat sheet is designed to walk you through each key decision, helping you understand your options and move forward with confidence.

Whether you’re determining your beneficiary status, figuring out if RMDs apply, or navigating the 10-Year Rule, this simple flowchart makes it easier to find clear, practical answers.

At Lake Road Advisors, we believe financial planning should be approachable, organized, and tailored to support your life—not add to its complexity. 

While an inheritance often comes with emotional and financial complexities, it also represents an opportunity to strengthen your financial future and honor a loved one’s legacy with thoughtful planning.

If you’d like help navigating your options or building a tax-smart plan for your inherited IRA, we’re here to support you.

Download our cheat sheet and schedule a conversation with Lake Road Advisors today.

Sources: 

  1. https://www.cnbc.com/2024/12/13/over-100-trillion-in-wealth-set-to-be-inherited.html
  2. https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-topics-beneficiary
  3. https://www.morningstar.com/personal-finance/inherited-iras-what-know-about-taxes-rmds-more

 

Lake Road Advisors, a Fee-Only, independent financial planning firm with offices in Corning, NY, Ithaca, NY and Portland, OR works with clients virtually all across the country. Paul Sydlansky, the founder of Lake Road Advisors LLC, has worked in the financial services industry for 20+ years. Prior to founding Lake Road Advisors, Paul worked at Morgan Stanley in Manhattan for 13 years. While at Morgan Stanley, Paul was a senior-level manager within the Institutional Equities Department. In 2018 he was named to Investopedia’s Top 100 Financial Advisors list. Paul received a Bachelor’s degree in Economics from Marist College and holds an MBA from New York University Leonard N. Stern School of Business. Paul is a CERTIFIED FINANCIAL PLANNER® and a member of the National Association of Personal Financial Advisors (NAPFA) and the XY Planning Network. They can be reached by phone at the Corning, NY office at (607) 438-2914, Ithaca, NY office at (607) 463-8400, or Vancouver, WA office at (607) 292-2172 or at the firm’s website at https://lakeroadadvisors.com/ 

The information presented is based on sources believed to be reliable and accurate at the time of publication. This material is for educational purposes only and does not necessarily reflect the views of the author, presenter, or affiliated organizations. It should not be construed as investment, tax, legal, or other professional advice. Always consult a qualified professional regarding your specific situation before making any decisions.

Help Your Child Build Wealth—Starting with Their Summer Job

Written by support@seostats.com on . Posted in Kids.

Mowing lawns, babysitting, or scooping ice cream—if your child has a paycheck, you can invest it for their future. This video breaks down how a Roth IRA works for minors and why early contributions matter. Paul shares a real-world example to show the power of compounding over decades. It’s a simple but effective way to start your child building wealth while they are young.

Topics covered:

  • Power of compounding
  • Roth IRAs for kids
  • Summer job earned income
  • Long-term tax-free growth

Transcript:

Hi everybody. I’m Paul Sydlansky and welcome to Unlocking Hidden Value. Today we’re going to talk about the power of compounding, and particularly how compounding can help your kids grow their wealth at a young age.

So as we get closer here to summer and kids start thinking about summer jobs, it’s important that you think about opening up a Roth IRA for your child. Remember, you can contribute into a Roth IRA up to $7,000 per year for your child as long as they have earned income up to that amount. So if your child were to be a babysitter or cut grass this summer and they made $5,000, you could put up to $5,000.

Now, here is where compounding comes in. If theoretically, you were able to invest $7,000 a year in this Roth IRA for 42 years up until your child is age 60, a $7,000 investment that grows at just 8%, which is in line with market historical returns, would amass to over $2 million in tax-free money that they would be able to have in their retirement. Again, a $7,000 investment per year for 42 years, you’re looking at over $2 million in tax-free money. Extremely powerful and really one of the best ways to help your child build wealth for tomorrow.

Lake Road Advisors, a Fee-Only, independent financial planning firm with offices in Corning, NY, Ithaca, NY and Portland, OR works with clients virtually all across the country. Paul Sydlansky, the founder of Lake Road Advisors LLC, has worked in the financial services industry for 20+ years. Prior to founding Lake Road Advisors, Paul worked at Morgan Stanley in Manhattan for 13 years. While at Morgan Stanley, Paul was a senior-level manager within the Institutional Equities Department. In 2018 he was named to Investopedia’s Top 100 Financial Advisors list. Paul received a Bachelor’s degree in Economics from Marist College and holds an MBA from New York University Leonard N. Stern School of Business. Paul is a CERTIFIED FINANCIAL PLANNER® and a member of the National Association of Personal Financial Advisors (NAPFA) and the XY Planning Network. They can be reached by phone at the Corning, NY office at (607) 438-2914, Ithaca, NY office at (607) 463-8400, or Portland, OR office at (607) 292-2172 or at the firm’s website at https://lakeroadadvisors.com/