The document discusses strategies for end-of-year retirement planning in 2006 based on new laws. It summarizes opportunities for contributing to IRAs until 2010 and converting traditional IRAs to Roth IRAs. It also discusses finding forgotten pension benefits from former employers by searching the Pension Benefit Guaranty Corporation or contacting the Social Security Administration.

1. Vol. 2 20064thQuarter
IRA Strategies
Gift-Tax Exclusions
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Talking to Mom and Dad
Great News for Section
529 College savings plans
In case of Emergency
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Do Not Call Registry
…….…………………..….3
Finding old & sometimes
forgotten pension plans
Roth IRAs ……………1
EnduringValues
It is with great pleasure that we introduce our newly redesigned quar-
terly newsletter which contains some last minutes planning ideas and
strategies for 2006. New laws provide potential payoffs as well as pit-
falls for year end planning.
Many of us baby boomers who are
nearing retirement age have also
worked for several employers. Quite
often this has left us with multiple
pension benefits. "Defined benefit"
pension plans ("DBP") are traditional
pension plans which promise to pay
a specific monthly amount to partici-
pants and/or their spouses when they
retire. Benefits accumulated in pen-
sion plans from former employers,
also known as deferred vested pen-
sion benefits, can significantly impact
your overall retirement saving needs.
Customarily, when an employee
meets the vesting requirements of an
employer, then leaves that employer
before reaching retirement age, the
employee is entitled to a deferred
vested pension benefit (if the em-
ployer had a non frozen plan during
the employment). This benefit is typi-
cally based on the employer’s plan
provisions as of the date of separa-
tion. The employee should obtain a
copy of the plan document for their
records. This vested benefit is the
considered a "frozen asset". The asset
remains frozen until the employee
(Continued on page 2)
Roth IRAsRoth IRAsRoth IRAsRoth IRAs
You can defer the deadlines for creating as well as for contributing to a traditional and Roth IRA
for 2006 until April 16 of 2007. However, converting to a Roth IRA should be done this year to
take advantage of turning the "clock" to Jan. 1st
, 2006. As long as you are 59 ½ years old and
(Continued on page 4)
HELPING TO SECURE THE FUTURE IN A WORLD OF RISK ™
Finding old and sometimes forgottenFinding old and sometimes forgottenFinding old and sometimes forgottenFinding old and sometimes forgotten
"defined benefit" pensions plans"defined benefit" pensions plans"defined benefit" pensions plans"defined benefit" pensions plans
S P EC T R UM F I NA N C I A L S OL UT I ONS (631) 595 1700

2. elects to begin receiving benefits when the employee at-
tains the age of retirement. The “age for retirement” is
also determined by the employer and stated in the pension
plan document.
The plan administrator must report to the employee and to
the IRS if an employee leaves his/her employment and
whether he/she has a vested pension benefit. In turn, the
IRS notifies the Social Security Administration ("SSA") about
the pension benefit.
If you can't remember the company you worked for from
age 19 to 25 you can contact the SSA via www.SSA.gov
or by calling (800) 772-1213. Social Security earnings
records will provide your former employer's federal tax ID
number. This will helps you to track down the pension
plan.
An important place to search for lost pensions is the Pen-
sion Benefit Guaranty Corp. ("PBGC"). The PBGC does
not insure federal pension plans. You can start the process
by visiting the agency's web site at www.PBGC.gov or call
(800) 400-7242. Your plan benefit should be available,
or at least in part. If the former employer has "frozen" the
plan or since filed for bankruptcy, the PBGC may have
taken over the plan.
Former employers are not currently obligated to notify you
of when you will become eligible to receive benefits before
normal retirement or tell you which options may make the
most sense for you.
You should keep plan administrators informed of any ad-
dress changes and make sure they have your spouse's in-
formation on file as well.
(Continued from page 1)
GiftGiftGiftGift----Tax ExclusionsTax ExclusionsTax ExclusionsTax Exclusions
The annual gift-tax exclusion (currently $12,000 per recipient) has been an estate-tax reduction tool, but can also help in
income tax planning. TIPRA changed some of the strategies such as extending the 0% tax on long-term capital gains
through 2010 for low-bracket taxpayers. Children ages 18 and older will be able to have taxable income of $30,000
plus and owe no tax on realized gains until 2010. The gifting of securities to your children is worth considering if you
plan to sell appreciated securities at the time your children are age 18 in order to pay for college or any other worth-
while expense.
Note that children ages 14 through 17 who have unearned income in excess of $1,700 in 2006 will be taxed at their
parents’ top rate. This is part of TIPRA and retroactive to January 1st
of this year.
IRA StrategiesIRA StrategiesIRA StrategiesIRA Strategies
This year’s Tax Increase Prevention and Reconciliation Act ("TIPRA") eliminated the
income and filing restrictions on converting an IRA to a tax-free Roth IRA, starting in
2010.
You should take advantage of this opportunity by contributing the maximum to your
traditional, SEP and SIMPLE IRAs until 2010. Additionally, keep in mind that many
employers have amended their 401k plans which now may enable you to contrib-
ute your salary deferral to a Roth 401k.
The Pension Protection Act ("PPA") of 2006 enables an individual, age 70, to give as much as $100,000 annually to
charity straight from their IRA without a need to pay tax on the distribution. However, no deduction is allowed for the
donation. These withdrawals, known as qualified charitable distributions can count toward the individual required mini-
mum distribution ("RMD") and can be applied for 2006 and 2007. Only a limited number of 501 (c) tax exempt organi-
zations can receive the money and the rules must as always be followed. This was never possible before.
The authors are representatives of Jefferson Pilot Securities Corporation, member NASD, SIPC, Branch office: 5 Pheasant Run
Lane, Dix Hills, NY 11746-8143 (631) 595 1700 which offers mutual funds and other securities products. JPSC and its represen-
tatives do not offer tax or legal advice. As with all matters of a tax or legal nature, you should consult your own tax and/or legal
counsel for advice regarding your individual circumstances. The information cannot be used or relied upon for the purpose of
avoiding IRS penalties. This material is not intended to provide tax, accounting or legal advice.

3. Great News for Section 529Great News for Section 529Great News for Section 529Great News for Section 529
College savings plansCollege savings plansCollege savings plansCollege savings plans
The PPA makes distributions from qualified higher education
expenses from 529 plans permanently federal income tax-
free. Qualified expenses include tuition, fees, room and
board, books and other supplies needed to attend an insti-
tution of higher education. A 10% federally mandated pen-
alty or additional tax continues to apply on any earnings
you withdraw for non-qualified expenses. Each plan descrip-
tion should be consulted for specific rules. Prior to the PPA
of 2006, the tax-free treatment of 529 plan withdrawals
under the Economic Growth and Tax Relief Reconciliation
Act of 2001 ("EGTRRA") was scheduled to expire on Decem-
ber 31st
, 2010.
Talking to Mom andTalking to Mom andTalking to Mom andTalking to Mom and
DadDadDadDad
During the holiday season we spend to-
getherness with our families and have a
great opportunity to make sure that our
elderly parents are in good physical as
well as financial health. Talking with ag-
ing parents about their finances can be
one of the hardest things to can do. It is a
vital part of putting your own financial
house in order, especially in light of the
fact that you or your spouse may be the
potential caregiver. Here are the ques-
tions to ask them and yourself:
Do you have upDo you have upDo you have upDo you have up----totototo----date informationdate informationdate informationdate information
about their advisors?about their advisors?about their advisors?about their advisors? This includes
names, phone and fax numbers, e- and
snail mail addresses of your parents fi-
nancial planners, brokers, accountants,
attorneys and doctors.
Do they have wills?Do they have wills?Do they have wills?Do they have wills? Where are the legal
documents located? Who has a copy?
Who are the executors of their will and
who are the trustees of existing or to be
created trust? When have these docu-
ments been last updated?
Do they have a living will and a healthDo they have a living will and a healthDo they have a living will and a healthDo they have a living will and a health
care proxy?care proxy?care proxy?care proxy?
Who is legally allowed to make health-
care decisions for them if they can't and
how do they feel about life support? This
information should be known to all sib-
lings and the document must be easily
located.
What legacy would you like to leave?What legacy would you like to leave?What legacy would you like to leave?What legacy would you like to leave?
It is an open-ended question that goes to
the core of who we really are including
our belief system.
Do they have durable powers of attor-Do they have durable powers of attor-Do they have durable powers of attor-Do they have durable powers of attor-
ney?ney?ney?ney?
This tool empowers others to act for your
parents on financial matters if they suffer
a period of mental incapacity. Each fi-
nancial institution may want its own pre-
approved form completed so be sure to
check with them in advance.
Are their beneficiary designations up toAre their beneficiary designations up toAre their beneficiary designations up toAre their beneficiary designations up to
date?date?date?date?
Have your parent double-check their re-
tirement plans, annuities, life insurance,
charitable trusts, and other investments.
Are contingent beneficiaries named and if
yes, is it a trust?
Beneficiary designation is one of the most
overlooked planning mistakes and can
save your parents and their heirs a lot of
aggravations and money.
Do they have longDo they have longDo they have longDo they have long----term care insur-term care insur-term care insur-term care insur-
ance?ance?ance?ance?
This often overlooked coverage can pay
for nursing-home, hospice, home- and
community-based care, as well as care in
assisted-living facilities.
Do your parents know the nursingDo your parents know the nursingDo your parents know the nursingDo your parents know the nursing
home they would like to stay in just inhome they would like to stay in just inhome they would like to stay in just inhome they would like to stay in just in
case they ever need it?case they ever need it?case they ever need it?case they ever need it?
Going to nursing home is seldom a
planned event and often follows a hospi-
tal stay. Your parents may already know
older friends who are in nursing homes.
It's a weekend trip you may not feel com-
fortable to do with your parent, but we
are sure that they will appreciate it in
years to come if the need arises.
Have they made final arrangements?Have they made final arrangements?Have they made final arrangements?Have they made final arrangements?
This may be hardest conversation and of
all, but planning can save a lot of heart-
ache with family members. Ask your par-
(Continued on page 4)
In case of Emergency ("ICE")In case of Emergency ("ICE")In case of Emergency ("ICE")In case of Emergency ("ICE")
Why not use the cell phone to tell others whom to contact in case
of emergency since most of us, including some of our children,
have cell phones with us at all times?
The idea was thought up by a paramedic who found that when
they went to the scenes of accidents, there were always mobile
phones with the patients, but they didn't know which numbers to
call. He therefore thought that it would be a good idea if there
was a nationally recognized name to file the "next of kin" under.
The idea is that you store the word "ICE" in your mobile phone
address book and with it enter the number of the person you
want to be contacted. Fore more than one contact name simply
enter ICE1, ICE2, ICE3, etc. or simply prefix a name already in
your mobile phonebook.
Federal Communications Commission ("FCC")Federal Communications Commission ("FCC")Federal Communications Commission ("FCC")Federal Communications Commission ("FCC") ---- Do Not Call RegistryDo Not Call RegistryDo Not Call RegistryDo Not Call Registry
Want to reduce the number of unwanted phone calls to your home or cell phone? The FCC established a national Do-Not-Call Reg-
istry. Commercial telemarketers may not call you if your number is on the registry.
You may register your residential telephone numbers, including wireless numbers, on the national Do-Not-Call registry at
www.donotcall.gov or by calling 1-888-382-1222.

4. The highest compliment you can pay us is
to recommend our services to your friends
and associates.
ent to write down instruc-
tions or ask them if you can
tape the conversation and
write their wishes down for
them. Their funeral prefer-
ences should be kept sepa-
rate from the will. Have they
already chosen their burial
plots and is there space for
you or other family mem-
bers? Make sure that all of
this information is in a safe
place.
LastlyLastlyLastlyLastly ---- We recommend
starting to answer these im-
portant questions. It may be
better to attempt to have
these discussions while you
are outside walking with
them. Proceed slowly - it will
take time. Respect your par-
ents' right to privacy when
possible. Recommend to
them that they advisors like
us who will give them a
"safety check". You may
want to offer to pay for fi-
nancial planning services
for them. This may help
them to go forward with the
planning. Always keep their
wishes paramount when
practical. Make sure your
siblings are informed and
everything is written down.
(Continued from page 3)
As the year ends,
we pause and
think about all
we are grateful
for.
Our relationship withOur relationship withOur relationship withOur relationship with
you is one thing weyou is one thing weyou is one thing weyou is one thing we
treasure.treasure.treasure.treasure.
Thank you for theThank you for theThank you for theThank you for the
opportunity to serveopportunity to serveopportunity to serveopportunity to serve
you.you.you.you.
We wish you andWe wish you andWe wish you andWe wish you and
yours every happi-yours every happi-yours every happi-yours every happi-
ness this holiday sea-ness this holiday sea-ness this holiday sea-ness this holiday sea-
son and throughoutson and throughoutson and throughoutson and throughout
the coming year.the coming year.the coming year.the coming year.
Spectrum Financial Solutions
5 Pheasant Run Lane
Dix Hills, NY 11746 U.S.A.
have held the account for 5
years, you can make tax-free
withdrawals from your Roth
IRA which would mean Jan.
1st
, 2011. Such a conversion
is only an option if your in-
come is not greater than
$100,000.
(Continued from page 1)