Campbell Wealth Management - March 2021

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We All Benefit From Tax Planning F or most people in retirement, taxes are one of their biggest recurring bills — up there with health care costs and a

Long-term tax planning doesn’t come without its challenges. The tax rules are constantly changing and will continue to change. The last president, for instance, had a different thought process on taxation than the current president. That’s always going to be the case, regardless of who’s president. Even if President Biden keeps things exactly the way they were under the Trump administration, things would still change. The Trump tax cuts end in 2025. They would have ended no matter what happened. Another thing to consider is U.S. national debt. Right now, it’s about $27.9 trillion. But that’s just one number of many on the government balance sheet. What people tend to miss is the federal government’s obligation to pay things like Social Security benefits (about $1.1 trillion), Medicare ($1.2 trillion), and defense ($721 billion). You can look at for more information, but this gives you a picture of where the U.S. is currently. If it feels to you like taxes are going up, you’re probably right, especially when you look at everything that needs to be paid for. However, as taxpayers, we have a remarkable amount of control. Take Roth conversions for example, which allow you to shield some of your income and investments from higher taxes. If you convert your traditional IRA into a Roth right now,

mortgage payment (if they have one). But one thing many people don’t realize is that taxes are one cost that you have some control over. If you have a mortgage, there isn’t really much you can do about making that payment unless you downsize. Otherwise, it’s there until you pay it off. Health care is similar. Medicare, for example, comes with certain costs that cannot be avoided. Taxes are where things change. While you can’t avoid taxes altogether, you can reduce your tax burden — if you are willing to plan ahead. There are a number of strategies available that pretty much anyone can use. This includes Roth conversions, charitable giving, 1031 exchanges, and tax-efficient income strategies, along with tax-deferred investment programs. But you have to plan. People have a habit of meeting with their tax planner or CPA once a year around tax time and calling that “tax planning.” But this is just doing your taxes, and it’s the bare minimum. You’re not really going to see much benefit if this is the extent of your tax planning. The key to successfully gaining control over your taxes is planning well in advance. I’m not just talking months, but years or more. You have to think long term if you really want to see any benefits from a tax planning perspective.

you pay today’s tax rate on the money you’re converting. Then, in retirement, all the money in your Roth IRA can be withdrawn tax-free — including the gains. On a slightly different note, we’ve had a lot of questions about IRAs and what to do with the 2020 required minimum distributions (RMDs) that were returned to their IRAs. We went to one of our CPAs and this is what they told us: “...The latest guidance is to treat returned RMD money as a rollover. This is logical — custodians are going to issue 1099-R forms for money distributed whether it was returned or not, and it’s so important to match gross distribution amounts to 1099-R forms when preparing tax returns to avoid notices."

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Laugh More, Age Less Why Laughter Is Good for You As we age, we’re told to wear sunscreen, eat more vegetables, take vitamins, and even walk more — all in hope that our internal clocks will slow down and we will age better. But something as simple as laughter could actually be one of the easiest ways to slow the ticking clock of aging. relief response from your brain by releasing dopamine. Just one chuckle may even improve your breathing and heart function! In fact, laughing can work wonders for the heart. One study showed that laughter therapy helped reduce the blood pressure and cholesterol levels understanding. When there are language barriers,

laughing together can create camaraderie and a tighter bond between people of different cultures. The dopamine release that comes with laughter aids in stress relief and creates powerful memories that can improve your mood and strengthen friendships. Of course, laughter has its downfalls, too. Laughing at someone else’s expense is detrimental to their health and can harm your relationships. So, stick to light jokes and actively seek shows, cartoons, or people who make you laugh. You’ll feel good, and your body will be pretty happy, too.

of its participants. Their blood circulation improved, too. Studies have also found that regular laughter can help strengthen your immune system, and it has long-term benefits for those with respiratory conditions. In addition to your body, laughter is also good for your social life. (And we don’t mean that people will want to spend time with you if you have all the good jokes!) Throughout history, laughter has been an evolutionary sign of

Scientists have long known that laughter can be therapeutic and help us live longer. It has been shown to reduce wear and tear on our bodies and improve our relationships. A Norwegian study found that those who prioritized humor were more likely to live past 70 than those who didn’t laugh often.

At a biological level, laughter can reduce tension in your muscles and activate a powerful stress-

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R ick is a wealth manager and has over 10 years of experience working with a diverse clientele including retirees and business professionals. More recently, he served as a private client advisor for a large Fortune 500 company, advising clients with complex financial and investment planning needs. Rick earned his Certified Financial Planner™ designation in 2012 and is currently scheduled to write for Level III of the coveted Chartered Financial Analyst (CFA) program, the highest distinction in the investment management profession. He also earned his Chartered Life Underwriter EMPLOYEE SPOTLIGHT: RICK BARAY

For example, for a client who took $100,000 and returned $90,000, I would report $10,000 as a taxable distribution and $90,000 as a nontaxable rollover distribution. We have no plans to delay and attach Forms 5498 at this time, but that may change if we start getting notices for clients. Keep in mind this is not tax advice. We are not accountants nor attorneys and do not give legal or tax advice. However, we can definitely help you decide what to do and even talk to your accountant or recommend one. I just thought this might be helpful for your 2020 tax return preparation. There is a lot more that can be said on tax planning, and I encourage you to check out our tax classes to learn more. The bottom line is that when you make an effort to plan for your tax situation in the long term, you’ll be in more control of your taxes year after year. With that, we wish you a happy end to winter as we welcome spring. And here’s hoping we’ll be seeing more of you face-to-face sooner rather than later! Kelly Campbell

business owners. Rick recently spent two years living in Spain, where he completed his MBA and Master of Finance degrees. He is a Southern California native and graduated from San Diego State University with a bachelor’s degree in Personal Financial Planning. Rick currently resides in northeast Washington with his two French bulldogs, Don Juan and Pablo. Rick is fluent in Spanish and has conversational skills in American Sign Language.

designation in 2015, specializing in insurance planning for families and

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Money Scams Are Skyrocketing Here Are 3Ways to Protect Yourself Right Now

For the past year, scammers have been working full time to fleece people. As a result of COVID-19, federal financial relief efforts, and state-level relief efforts, scammers have found a new way to get into their victims’ pockets. Now, they’re using COVID-19 again, this time with the “vaccine scam.” Through this scam, they’ll sign you up for the COVID-19 vaccine in exchange for a fee. They are also using variations of the grandparent scam, in which scammers pretend to be a family member in trouble (this time, they have COVID-19 or have lost their job) and they need money. Scammers make phone calls, send text messages, and craft phishing emails, hoping you’ll take the bait.

government or a government agency, it’s a scammer. No one from any federal agency will ever call you out of the blue. Anyone claiming to have a cure or pretending to be in desperate need of money is also trying to scam you. Never say a word back to them. Cut them off and go about your day. 2. Sign up for Informed Delivery by USPS. This free service is a great way to monitor your incoming mail. Every morning, USPS sends you an email with scanned images of the day’s mail (this doesn’t usually include larger parcels). When you pick up your mail later in the day, you can verify if anything is missing. Scammers may prefer phone calls, but mail thieves are still very much on the prowl. 3. Sign up for an identity protection and fraud detection service. You never know who might end up with your personal information, but you can take steps to keep it safe. There are several services, like LifeLock, Identity Guard, and Intelius Identity Project, that offer comprehensive identify protection. They monitor credit cards, addresses, phone numbers, bank accounts, and more with the purpose of scoping out unusual or fraudulent behavior. Many services can be customized to fit your specific needs.

How can you protect yourself from these financial scams and more? Try these three different ways!

1. Shut them down. If you get a call from a scammer, hang up immediately (better yet, don’t answer unknown callers at all). At the same time, delete scam texts or emails the second you see them. If you get a call, text, or email from someone claiming to be with the

Would you like to be a Campbell Wealth Management Ambassador? Would you like access to exclusive events?

Estate & Legacy Planning Tuesday, March 9 at 3 p.m. Topic TBD Tuesday, April 13 at 3 p.m. Wellness & Wisdom Webinar Series

All you have to do is refer a friend. Do you know someone who: • Wants to be better prepared for retirement?

• Is looking for a second opinion regarding their portfolio? • Has gone through a major life event (death of a spouse, retirement, etc.)? Call us at ( 571) 800-6371 and let’s set up an introduction! If they are important to you, they are important to us.

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700 S. Washington St. Suite 220 Alexandria, Virginia 22314 (703) 535-5300

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Everyone Needs a Tax Strategy

The Easiest Anti-Aging Tactic? Laughter

Introducing Rick Baray


Protect Yourself From COVID-19 Scams!

Become a Campbell Wealth Ambassador!

Upcoming Events


3 Irish Travel Destinations for Your Bucket List

Securities offered only by duly registered individuals through Madison Avenue Securities, LLC (MAS), member FINRA/SIPC. Advisory services offered only by duly registered individuals through Campbell Wealth Management, LLC (CWM), a Registered Investment Advisor. MAS and CWM are not affiliated entities.

3 Irish Travel Destinations for Your Bucket List Don’t Miss These Historic Spots!

Ireland's Spookiest Castle – Coolderry, County Offlaly

Traveling to Ireland might not be an option for you right now, but like a leprechaun hoarding gold, you can still fill up your bucket list with all of the pubs, rolling hills, and lucky sites you’d love to see. This month when you’re planning your trip to Dublin, Galway, or Cork, add these spots to your itinerary. The Oldest Bar in the World – Athlone, County Westmeath When Sean’s Bar closed because of the COVID-19 pandemic, the entire country of Ireland groaned. The pub is famous for its Irish whiskey, music, and history, which stretches back to 900 A.D., far enough to earn it the title of “Oldest Bar in the World.” As of this writing, Sean’s is slated to reopen when it’s safe again, and considering it has already survived the bubonic plague and the Spanish flu, odds are good that it will make

it through this, too! Soon, you’ll be able to raise a glass in the same rooms where the noblemen of nearby Athlone Castle shared drinks in the 12th century. Find more historical tidbits at Ireland’s Spookiest Castle – Coolderry, County Offaly If you’re a fan of thrillers and true crime podcasts, you won’t want to leave Ireland without visiting Leap Castle. This 16th- century haunt was built by the fierce O’Bannon clan, who famously ordered two brothers to throw themselves off a rocky cliff as a test of strength. The survivor was named clan chief, and later Leap Castle was built on that very site — beginning its long and bloody history. Read more about its haunted priest’s house, murder hole room, and bloody chapel at and meet the many ghosts that haunt its halls.

A Famous Smugglers’ Shortcut – Newcastle, County Down Get ready to tie up your hiking boots! This roughly 2-mile hike, called Hare’s Gap, is one of the most famous and beautiful routes in Ireland. When you climb through this pass in the Mourne Mountains, you’ll be rewarded with views of glacial cliffs, boulder fields, and ancient-looking stone walls. Legend has it that the pass was part of the Brandy Pad smuggling route, used to ferry goods like soap, leather, spices, and coffee.

Safe travels, and ádh mór (good luck)!

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