Blog | CB Investment Management

Consider QLACs for strengthening your retirement plan

Retirees with substantial tax deferred liabilities can run into a sudden surge in taxable income and related IRMAA costs when the time comes for Required Minimum Distributions.  

Without a plan in place retirees can find themselves in a much higher taxable income level, and in addition a higher medicare  IRMAA threshold that will increase their medicare premium costs.


This double whammy can materially damage your after tax spending power. As it will suddenly hit in your late 70s, there will be very little that you can do about it. 


This is why a retirement plan is so important. This problem should be visible  well in advance and in time to review several options for a much higher after tax income. Make sure you have an effective plan years in advance. You will need a credible software like maxifi and also help from an IRMAA certified planner.


There are many options to consider in your retirement plan as you seek to balance out Investment risk, Longevity risk, Tax risk and, most likely, higher IRMAA liabilities.

QLACs can play a part in all these issues at least as a way to balance all these elements. 

So, What is a QLAC?

Here is a good summary of a qualified longevity annuity contract. It’s a type of annuity that can be bought with money from qualified retirement accounts. And it provides a way to delay required minimum distributions and their associated taxes from the portion of the money used to buy this type of annuity. Yet at the same time, it helps build a plan for the possibility of living a very long life.

Make sure you have an retirement plan once you reach 60 years of age at the latest. Otherwise, although you may not realize it your flexibility and choices may already have started to decline.


Best Practice is a matter of your Best Interest.

Education and a Commitment to Informed Consent is an Obligation.

Chris Belchamber is an IRMAA Certified Planner

Medicare’s IRMAA impacts every retirement plan. Learning how to mitigate it is available via IRMAA Certified Planners designation.

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