Highlights of changes for 2020

The contribution limit for employees who participate in 401(k), 403(b), most 457 plans, and the federal government’s Thrift Savings Plan has increased from $19,000 to $19,500.

The catch-up contribution limit for employees aged 50 and over who participate in these plans has increased from $6,000 to $6,500.
The contribution limitation regarding SIMPLE retirement accounts for 2020 has increased to $13,500, up from $13,000 for 2019.

The income ranges for determining eligibility to make deductible contributions to traditional Individual Retirement Accounts (IRAs), to contribute to Roth IRAs and to claim the Saver’s Credit all increased for 2020.

Taxpayers can deduct contributions to a traditional IRA if they meet certain conditions. If during the year either the taxpayer or his or her spouse was covered by a retirement plan at work, the deduction may be reduced, or phased out, until it is eliminated, depending on filing status and income. (If neither the taxpayer nor his or her spouse is covered by a retirement plan at work, the phase-outs of the deduction do not apply.)

Here are the phase-out ranges for 2020:

• For single taxpayers covered by a workplace retirement plan, the phase-out range is $65,000 to $75,000, up from $64,000 to $74,000.

• For married couples filing jointly, where the spouse making the IRA contribution is covered by a workplace retirement plan, the phase-out range is $104,000 to $124,000, up from $103,000 to $123,000.

• For an IRA contributor who is not covered by a workplace retirement plan and is married to someone who is covered, the deduction is phased out if the couple’s income is between $196,000 and $206,000, up from $193,000 and $203,000.

• For a married individual filing a separate return who is covered by a workplace retirement plan, the phase-out range is not subject to an annual cost-of-living adjustment and remains $0 to $10,000.

The income phase-out range for taxpayers making contributions to a Roth IRA is $124,000 to $139,000 for singles and heads of household, up from $122,000 to $137,000. For married couples filing jointly, the income phase-out range is $196,000 to $206,000, up from $193,000 to $203,000. The phase-out range for a married individual filing a separate return who makes contributions to a Roth IRA is not subject to an annual cost-of-living adjustment and remains $0 to $10,000.

Key limit remains unchanged

The limit on annual contributions to an IRA (Traditional or Roth) remains unchanged at $6,000. The additional catch-up contribution limit for individuals aged 50 and over is not subject to an annual cost-of-living adjustment and remains at $1,000.

Details on these and other retirement-related cost-of-living adjustments for 2020 are in Notice 2019-59, available on IRS.gov.

Group photo
Back row (left to right): Ruth Trautwein, Beth Peabody, Hannah English, Karen Hubert, John Evers, Leslie Shockley.
Front row (left to right): Doug Peabody, Brandon Dant, Tracey Trosper, Abby Powell (winner of our contest!), Missy Vella.

The SIA Team celebrated the holidays this year at Pinot’s Pallet in St. Matthews, where the slogan is “Paint. Drink. Have Fun.” Although most of our painting skills leave much to be desired, we had a blast! We hope you experience the same laughter and joy during this Holiday Season and throughout the New Year.

Douglas D. Stegner

To read Doug’s Business First interview, click here.

For a list of charities that Doug Stegner has helped over the past 30+ years, click here.

Please join SIA in Congratulating Our Co-Founder!

Please join us in welcoming Hannah English to SIA’s team as a Portfolio Management Associate. Ms. English, a Louisville native, brings with her a diverse background focused on wealth management and investment management. She serves as a member of SIA’s Portfolio Management Team, helping manage existing client relationships and meeting with prospective clients.

Ms. English’s extensive experience includes serving most recently as a Business Development Associate at Ramsey Quantitative Systems, Inc. (RQSI) in Louisville, where she handled investor relations and new business development. Prior to returning to Louisville, she held the role of Investment Associate for the Kelly Group at J.P. Morgan Securities in New York City. In this role, she provided wealth management, financial planning and client service support for high net worth individuals and families.

Hannah English, CFA®

Ms. English began her career in New York City and Tanzania as the Development Manager for Touch Foundation, a healthcare and educational network in Tanzania where she helped manage institutional partnerships and individual development, fundraising and grant writing.

Ms. English earned her Chartered Financial Analyst® (CFA®) designation in 2019. She received her Bachelor of Arts in Economics from Davidson College in North Carolina, where she was a 4-year starter for their Division I Women’s Field Hockey team and co-captain during her senior year. Taking advantage of Davidson’s study abroad program, Ms. English completed an internship at the International Center for Trade and Sustainable Development in Geneva, Switzerland, and attended the London School of Economics’ intensive study in “Money & Banking”. During her time abroad, she also completed an internship at ALIZEE Bank AG in Vienna, Austria.
We are proud and excited to add her to our team!

Dear Melissa:

Stegner Investment Associates, Inc. (SIA) is a Registered Investment Advisor (RIA) with the Securities and Exchange Committee (SEC) under the Investment Advisory Act of 1940. We have served as fiduciaries since our inception in 1994 and are required by law to act always in our clients’ best interest. 

However, many investors work with professionals who, in the past, have not been held to the same level of fiduciary duty. For these investors, the good news was announced on Wednesday, as the Securities & Exchange Commission (SEC) issued an investment advice reform package ruling called “Regulation Best Interest.”

This new rule will require brokers to give investors more information about their commissions and other practices that can influence the broker’s advice. Now, brokers will have to provide clients with a disclosure document that lists key facts about the broker-client relationship, including potential conflicts of interest, and they must also disclose when they pick investments from a limited range of offerings – i.e.: their firm’s own products. 

It is important to note that SIA’s independent business model has allowed us to select from an unlimited range of offerings and that we have also offered clients full fee disclosure for more than 25 years. SEC Chairman Jay Clayton said, “This action is long overdue.” These regulations are still not as stringent as the fiduciary rule that our firm must follow, but as Clayton continued, “this regulation is a significant step toward increasing investor protection while also preserving investors’ access to a range of products and services at a reasonable cost.”

Before this ruling, brokers and financial advisors who were not registered with the SEC could recommend investments that were “roughly suitable” for their clients, rather than proving that they acted in the clients’ “best interest.” Although the SEC is making some long overdue changes to benefit investors, they must be aware that this new rule does not require brokers to recommend the lowest-cost options. In addition, once the regulation goes into effect one year from now, brokers will no longer be able to compete in sales contests for incentives and they will no longer be allowed to use the term “adviser” as part of their name or title when dealing with an investor.

While “Regulation Best Interest” is an improvement, SEC Commissioner Rob Jackson remarked that “investors should seek out true fiduciary advice from financial professionals who have chosen to hold themselves to a higher standard.” As an RIA, SIA has held ourselves to the ultimate standard, serving as fiduciary throughout the history of our firm.

Dear Melissa:

Stegner Investment Associates is pleased to announce that Douglas D. Peabody has joined our management team in the role of President and Chief Operating Officer. Doug brings extensive leadership, management and consulting experience to SIA.

In this role, Doug will lead SIA’s non-investment management activities.

During his diverse 30-year career, Doug specialized in both the investment management and real estate industries, most recently serving ten years as President of Louisville, KY based Horizon Commercial Realty and Chief Operating officer for commercial developer Hollenbach-Oakley.

Douglas Peabody

Prior to joining HCR, Doug spent eight years as the Managing Director of Marketing/Sales and Distribution at Convergent Capital Management. This $24 billion money management holding company was comprised of ten individual operating companies which included investment management and financial service companies.

Doug served as a consultant for Louisville-based Eager & Associates for seven years. In this role he provided advice and counsel to investment managers throughout the U.S. and internationally.

After graduating from Babson College with a Bachelor of Science in Investments, Quantitative Methods and Economics, Doug began his career trading bonds for the former American Security Bank in Washington, D.C.

Please join us in welcoming Doug to SIA!

Frauds perpetrated against senior citizens are estimated to cost victims $2.9 billion each year. The Senate Committee on Aging, which operates a hotline for reporting such frauds, recently published a report showing the types of senior frauds that were reported most frequently in 2018, when more than 1,500 people called the hotline. Authorities estimate that they uncover 1 out of every 24 cases of senior fraud. 

Although these scams are aimed at seniors, we all need to be aware and vigilant. 

Click here for a list of the Top 10 Scams Targeting Seniors.

Anyone with information about suspected fraud can call the toll-free fraud hotline at 1-855-303-9470, or contact the Committee through its website located at http://www.aging.senate.gov/fraud-hotline.