Government Shutdowns, 401(k) Catch-Up Changes, and When Trusts Actually Make Sense

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Long Story Short

Burney Wealth Management

21 episodes

1 week ago

Long Story Short is a weekly financial planning and investing podcast from Burney Wealth Management. Each week, your hosts Andy Pratt, CFA, CAIA and Adam Newman, CFA, CFP®, discuss the biggest questions they’re hearing from clients. They’ll occasionally bring in team members and interesting guests to discuss specialized topics like estate planning, business succession, and retirement income strategies. Founded in 1974, The Burney Company is a fee-only investment advisory firm that manages $3 billion in assets. Learn more about comprehensive financial planning at burneywealth.com.

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Government Shutdowns, 401(k) Catch-Up Changes, and When Trusts Actually Make Sense

Long Story Short

39 minutes 11 seconds

1 month ago

Government Shutdowns, 401(k) Catch-Up Changes, and When Trusts Actually Make Sense

Andy lives right outside DC, where government shutdowns actually matter. For the rest of the country? Not so much.

Markets barely react to these political theatrics anymore. Seven out of ten shutdowns since 1980 saw positive stock returns. The worst decline was 2% back in 1990.

But there's a tax change coming in 2026 that does matter: if you make over $145,000 and contribute catch-up dollars to your 401(k), those contributions will now have to be made through a Roth account, rather than a 401(k). No more deferring taxes on that extra $7,500.

Adam and Andy discuss what this means, why it's confusing, and whether it might actually be good for you long-term. Plus, they tackle the perennial question: do I need a trust?

We cover:

Why government shutdowns don't move markets (even 35-day ones)
Markets expecting dysfunction as the new normal
The 2026 catch-up contribution rule change explained
Income thresholds, look-back periods, and per-employer limits
Why forced Roth contributions might help you despite the tax hit
Revocable vs. irrevocable trusts
When trusts make sense beyond estate tax planning
The probate problem nobody thinks about
How wills and trusts work together (not against each other)

⏱️ Timestamps:

(00:32) Living in the DC shutdown zone
(01:55) Government shutdown history and market returns
(03:51) Debt ceiling vs. shutdown drama
(06:46) Markets pricing in permanent dysfunction
(09:22) The 2026 401(k) catch-up contribution change
(11:48) Those oddly specific age brackets (60-63)
(13:38) Roth catch-up requirements starting 2026
(16:41) Per-employer loopholes
(18:49) Silver lining: forced tax diversification
(22:39) Trust fundamentals: revocable vs. irrevocable
(26:13) Control beyond the grave
(29:25) The probate nightmare
(33:25) Wills complement trusts, don't replace them
(38:01) Podcast disclosures

Resources:

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#RetirementPlanning #401k #EstatePlanning #Trusts #TaxPlanning #WealthManagement

The Burney Company is an SEC-registered investment adviser. Burney Wealth Management is a division of the Burney Company. Registration with the SEC or any state securities authority does not imply that Burney Company or any of its principals or employees possesses a particular level of skill or training in the investment advisory business or any other business. This content is for informational and educational purposes only. It is not intended as personalized investment advice or a recommendation.